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H. B. No. 534 As IntroducedAs Introduced
129th General Assembly | Regular Session | 2011-2012 |
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Cosponsors:
Representatives Henne, Stebelton, Fende, Sprague, Kozlowski, Hagan, C., Yuko
A BILL
To amend sections 184.19 and 5727.81 and to enact
section 184.05 of the Revised Code to authorize
the Third Frontier Commission to award grants
related to the establishment and operation of data
centers and the development of a high speed fiber
optic network in the state, and to authorize a
kilowatt-hour excise tax reduction for electric
distribution companies supplying such centers at a
discounted rate.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 184.19 and 5727.81 be amended and
section 184.05 of the Revised Code be enacted to read as follows:
Sec. 184.05. (A) As used in this section:
(1) "Data center" means a facility that is primarily used to
house tangible personal property that is or will be used in
providing data center services.
(2) "Data center services" means electronic information
services as defined in section 5739.01 of the Revised Code or any
similar services, as may be further determined by the third
frontier commission. "Data center services" does not include
electronic publishing as defined in section 5739.01 of the Revised
Code.
(3) "Eligible partnership" means a partnership between a
for-profit business entity and a state institution of higher
education.
(4) "State institution of higher education" has the same
meaning as in section 3345.011 of the Revised Code.
(B) The data center development grant program is hereby
created to promote the establishment of data centers in the state.
The third frontier commission shall award grants on a competitive
basis to eligible partnerships for the establishment and operation
of data centers. The amount awarded to a single eligible
partnership shall not exceed five million dollars. The total
amount of grants awarded under the program shall not exceed fifty
million dollars. Grants shall be made from the third frontier
research and development fund created under section 184.19 of the
Revised Code.
(C) The data center high speed fiber optic network grant
program is hereby created to promote the development of a high
speed fiber optic network in the state and to assist in the
provision of high speed fiber optics to data centers. The third
frontier commission shall award grants to persons that provide
high speed fiber optics to a data center that has been or will be
established in this state with the assistance of a grant awarded
under division (B) of this section. The total amount of grants
awarded under the program shall not exceed twenty-five million
dollars. Grants shall be made from the third frontier research and
development fund created under section 184.19 of the Revised Code.
(D) The third frontier commission shall adopt rules under
Chapter 119. of the Revised Code that are necessary for the
administration of the data center development grant program and
the data center high speed fiber optic network grant program. The
rules shall establish all of the following:
(1) Specific eligibility criteria for grant applicants;
(2) A definition of what constitutes "high speed fiber
optics" for purposes of the data center high speed fiber optic
network grant program;
(3) Forms and procedures by which eligible applicants may
apply for grants under this section;
(4) Criteria for reviewing, evaluating, and ranking
applications, and for approving applications from eligible
applicants that best serve the goals of the data center
development grant program and the data center high speed fiber
optic network grant program;
(5) Reporting requirements and monitoring procedures;
(6) Any other rules necessary to implement and administer the
grant programs.
(E) An eligible applicant that receives a grant under the
data center development grant program or the data center high
speed fiber optic network grant program is not precluded from
being considered for or participating in other financial
assistance programs offered by the department of development.
Sec. 184.19. The third frontier research and development
fund is hereby created in the state treasury. The fund shall
consist of the net proceeds of the obligations issued and sold by
the issuing authority pursuant to sections 151.01 and 151.10 of
the Revised Code. Investment earnings of the fund shall be
credited to the fund. Moneys in the fund shall be used in
accordance with sections 184.05, 184.10 to 184.18, and 184.20 of
the Revised Code and for associated administrative expenses.
Sec. 5727.81. (A) For the purpose of raising revenue for
public education and state and local government operations, an
excise tax is hereby levied and imposed on an electric
distribution company for all electricity distributed by such
company at the following rates per kilowatt hour of electricity
distributed in a thirty-day period by the company through a meter
of an end user in this state:
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KILOWATT HOURS DISTRIBUTED |
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RATE PER |
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TO AN END USER |
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KILOWATT HOUR |
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For the first 2,000 |
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$.00465 |
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For the next 2,001 to 15,000 |
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$.00419 |
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For 15,001 and above |
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$.00363 |
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If no meter is used to measure the kilowatt hours of
electricity distributed by the company, the rates shall apply to
the estimated kilowatt hours of electricity distributed to an
unmetered location in this state.
The electric distribution company shall base the monthly tax
on the kilowatt hours of electricity distributed to an end user
through the meter of the end user that is not measured for a
thirty-day period by dividing the days in the measurement period
into the total kilowatt hours measured during the measurement
period to obtain a daily average usage. The Except as provided in
division (E) of this section, the tax shall be determined by
obtaining the sum of divisions (A)(1), (2), and (3) of this
section and multiplying that amount by the number of days in the
measurement period:
(1) Multiplying $0.00465 per kilowatt hour for the first
sixty-seven kilowatt hours distributed using a daily average;
(2) Multiplying $0.00419 for the next sixty-eight to five
hundred kilowatt hours distributed using a daily average;
(3) Multiplying $0.00363 for the remaining kilowatt hours
distributed using a daily average.
Except as provided in division (C) of this section, the
electric distribution company shall pay the tax to the tax
commissioner in accordance with section 5727.82 of the Revised
Code, unless required to remit each tax payment by electronic
funds transfer to the treasurer of state in accordance with
section 5727.83 of the Revised Code.
Only the distribution of electricity through a meter of an
end user in this state shall be used by the electric distribution
company to compute the amount or estimated amount of tax due. In
the event a meter is not actually read for a measurement period,
the estimated kilowatt hours distributed by an electric
distribution company to bill for its distribution charges shall be
used.
(B) Except as provided in division (C) of this section, each
electric distribution company shall pay the tax imposed by this
section in all of the following circumstances:
(1) The electricity is distributed by the company through a
meter of an end user in this state;
(2) The company is distributing electricity through a meter
located in another state, but the electricity is consumed in this
state in the manner prescribed by the tax commissioner;
(3) The company is distributing electricity in this state
without the use of a meter, but the electricity is consumed in
this state as estimated and in the manner prescribed by the tax
commissioner.
(C)(1) As used in division (C) of this section:
(a) "Total price of electricity" means the aggregate value in
money of anything paid or transferred, or promised to be paid or
transferred, to obtain electricity or electric service, including
but not limited to the value paid or promised to be paid for the
transmission or distribution of electricity and for transition
costs as described in Chapter 4928. of the Revised Code.
(b) "Package" means the provision or the acquisition, at a
combined price, of electricity with other services or products, or
any combination thereof, such as natural gas or other fuels;
energy management products, software, and services; machinery and
equipment acquisition; and financing agreements.
(c) "Single location" means a facility located on contiguous
property separated only by a roadway, railway, or waterway.
(2) Division (C) of this section applies to any commercial or
industrial purchaser's receipt of electricity through a meter of
an end user in this state or through more than one meter at a
single location in this state in a quantity that exceeds
forty-five million kilowatt hours of electricity over the course
of the preceding calendar year, or any commercial or industrial
purchaser that will consume more than forty-five million kilowatt
hours of electricity over the course of the succeeding twelve
months as estimated by the tax commissioner. The tax commissioner
shall make such an estimate upon the written request by an
applicant for registration as a self-assessing purchaser under
this division. For the meter reading period including July 1,
2008, through the meter reading period including December 31,
2010, such a purchaser may elect to self-assess the excise tax
imposed by this section at the rate of $.00075 per kilowatt hour
on the first five hundred four million kilowatt hours distributed
to that meter or location during the registration year, and a
percentage of the total price of all electricity distributed to
that meter or location equal to three and one-half per cent. For
the meter reading period including January 1, 2011, and
thereafter, such a purchaser may elect to self-assess the excise
tax imposed by this section at the rate of $.00257 per kilowatt
hour for the first five hundred million kilowatt hours, and
$.001832 per kilowatt hour for each kilowatt hour in excess of
five hundred million kilowatt hours, distributed to that meter or
location during the registration year.
A qualified end user that receives electricity through a
meter of an end user in this state or through more than one meter
at a single location in this state and that consumes, over the
course of the previous calendar year, more than forty-five million
kilowatt hours in other than its qualifying manufacturing process,
may elect to self-assess the tax as allowed by this division with
respect to the electricity used in other than its qualifying
manufacturing process.
Payment of the tax shall be made directly to the tax
commissioner in accordance with divisions (A)(4) and (5) of
section 5727.82 of the Revised Code, or the treasurer of state in
accordance with section 5727.83 of the Revised Code. If the
electric distribution company serving the self-assessing purchaser
is a municipal electric utility and the purchaser is within the
municipal corporation's corporate limits, payment shall be made to
such municipal corporation's general fund and reports shall be
filed in accordance with divisions (A)(4) and (5) of section
5727.82 of the Revised Code, except that "municipal corporation"
shall be substituted for "treasurer of state" and "tax
commissioner." A self-assessing purchaser that pays the excise tax
as provided in this division shall not be required to pay the tax
to the electric distribution company from which its electricity is
distributed. If a self-assessing purchaser's receipt of
electricity is not subject to the tax as measured under this
division, the tax on the receipt of such electricity shall be
measured and paid as provided in division (A) of this section.
(3) In the case of the acquisition of a package, unless the
elements of the package are separately stated isolating the total
price of electricity from the price of the remaining elements of
the package, the tax imposed under this section applies to the
entire price of the package. If the elements of the package are
separately stated, the tax imposed under this section applies to
the total price of the electricity.
(4) Any electric supplier that sells electricity as part of a
package shall separately state to the purchaser the total price of
the electricity and, upon request by the tax commissioner, the
total price of each of the other elements of the package.
(5) The tax commissioner may adopt rules relating to the
computation of the total price of electricity with respect to
self-assessing purchasers, which may include rules to establish
the total price of electricity purchased as part of a package.
(6) An annual application for registration as a
self-assessing purchaser shall be made for each qualifying meter
or location on a form prescribed by the tax commissioner. The
registration year begins on the first day of May and ends on the
following thirtieth day of April. Persons may apply after the
first day of May for the remainder of the registration year. In
the case of an applicant applying on the basis of an estimated
consumption of forty-five million kilowatt hours over the course
of the succeeding twelve months, the applicant shall provide such
information as the tax commissioner considers to be necessary to
estimate such consumption. At the time of making the application
and by the first day of May of each year, a self-assessing
purchaser shall pay a fee of five hundred dollars to the tax
commissioner, or to the treasurer of state as provided in section
5727.83 of the Revised Code, for each qualifying meter or
location. The tax commissioner shall immediately pay to the
treasurer of state all amounts that the tax commissioner receives
under this section. The treasurer of state shall deposit such
amounts into the kilowatt hour excise tax administration fund,
which is hereby created in the state treasury. Money in the fund
shall be used to defray the tax commissioner's cost in
administering the tax owed under section 5727.81 of the Revised
Code by self-assessing purchasers. After the application is
approved by the tax commissioner, the registration shall remain in
effect for the current registration year, or until canceled by the
registrant upon written notification to the commissioner of the
election to pay the tax in accordance with division (A) of this
section, or until canceled by the tax commissioner for not paying
the tax or fee under division (C) of this section or for not
meeting the qualifications in division (C)(2) of this section. The
tax commissioner shall give written notice to the electric
distribution company from which electricity is delivered to a
self-assessing purchaser of the purchaser's self-assessing status,
and the electric distribution company is relieved of the
obligation to pay the tax imposed by division (A) of this section
for electricity distributed to that self-assessing purchaser until
it is notified by the tax commissioner that the self-assessing
purchaser's registration is canceled. Within fifteen days of
notification of the canceled registration, the electric
distribution company shall be responsible for payment of the tax
imposed by division (A) of this section on electricity distributed
to a purchaser that is no longer registered as a self-assessing
purchaser. A self-assessing purchaser with a canceled registration
must file a report and remit the tax imposed by division (A) of
this section on all electricity it receives for any measurement
period prior to the tax being reported and paid by the electric
distribution company. A self-assessing purchaser whose
registration is canceled by the tax commissioner is not eligible
to register as a self-assessing purchaser for two years after the
registration is canceled.
(7) If the tax commissioner cancels the self-assessing
registration of a purchaser registered on the basis of its
estimated consumption because the purchaser does not consume at
least forty-five million kilowatt hours of electricity over the
course of the twelve-month period for which the estimate was made,
the tax commissioner shall assess and collect from the purchaser
the difference between (a) the amount of tax that would have been
payable under division (A) of this section on the electricity
distributed to the purchaser during that period and (b) the amount
of tax paid by the purchaser on such electricity pursuant to
division (C)(2) of this section. The assessment shall be paid
within sixty days after the tax commissioner issues it, regardless
of whether the purchaser files a petition for reassessment under
section 5727.89 of the Revised Code covering that period. If the
purchaser does not pay the assessment within the time prescribed,
the amount assessed is subject to the additional charge and the
interest prescribed by divisions (B) and (C) of section 5727.82 of
the Revised Code, and is subject to assessment under section
5727.89 of the Revised Code. If the purchaser is a qualified end
user, division (C)(7) of this section applies only to electricity
it consumes in other than its qualifying manufacturing process.
(D) The tax imposed by this section does not apply to the
distribution of any kilowatt hours of electricity to the federal
government, to an end user located at a federal facility that uses
electricity for the enrichment of uranium, to a qualified
regeneration meter, or to an end user for any day the end user is
a qualified end user. The exemption under this division for a
qualified end user only applies to the manufacturing location
where the qualified end user uses more than three million kilowatt
hours per day in a qualifying manufacturing process.
(E)(1) As used in this division:
(a) "Qualified data center" means a data center established
with the assistance of a grant awarded under the data center
development grant program authorized by section 184.05 of the
Revised Code.
(b) "Discounted rate" means a rate charged to a qualified
data center for retail electric service, as defined in section
4928.01 of the Revised Code, pursuant to a reasonable arrangement
between the electric distribution company and the qualified data
center under section 4905.31 of the Revised Code that is less than
the unvaried rate.
(c) "Unvaried rate" means the rate that would be charged a
qualified data center for retail electric service in the absence
of a reasonable arrangement.
(d) "Discount ratio" means the amount obtained by dividing
the discounted rate by the unvaried rate.
(2) The monthly tax on the kilowatt hours of electricity
distributed at a discounted rate to a qualified data center shall
be determined by obtaining the sum of divisions (A)(1), (2), and
(3) of this section and multiplying that sum by the discount ratio
and by the number of days in the measurement period.
On request of the tax commissioner, an electric distribution
company that charges a discounted rate to a qualified data center
shall provide any information that, in the tax commissioner's
opinion, is necessary to establish the discount ratio or the
amount of tax due under this division.
Section 2. That existing sections 184.19 and 5727.81 of the
Revised Code are hereby repealed.
Section 3. The amendment by this act of section 5727.81 of
the Revised Code applies to measurement periods beginning on or
after the effective date of this act.
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