Solar Bill Passes Louisiana State Senate but …

State Capital w tree

SB 231 by Martiny and HB 705 by Ponti were introduced in this year’s legislative session on behalf of some in the solar industry in Louisiana as an attempt to head off complete elimination of tax rebates for installation of residential solar energy systems. The attempt was pro-active in offering a phase out of solar tax credits in exchange for their extension at least until Dec 31, 2017. Solar industry reps worked with the legislative fiscal office and the governor’s office ahead of the session in order to come up with a bill that would be acceptable. Since its introduction the legislation has assumed the identity of a ball in play as it changed form numerous times.

At the start and giving weight to the old saying that no good deed goes unpunished the legislation faced hostile amendments from Sen Robert Adley a fiscal hawk who wanted to limit eligibility for tax rebate to one time/one residence for each tax payer, and to eliminate leased systems entirely. Turns out that while sales to homeowners have been relatively even, leasing of systems has grown to the point of taking ¾ of the state’s solar tax rebate pie. A rebate program that originally was thought to make maybe $1 M impact to the state general fund turned out to be more than a $100 M hit. Some legislators wanted to kill the whole program. Others, recognizing that the Louisiana solar industry employs over 1000 persons, just wanted to contain the impact to the state budget.

That containment started with Sen Adley’s proposals to limit eligibility for the tax rebate to one project per homeowner, at 50% of $25,000 with phase-out by end of 2017. He backed off his threat to eliminate leasing after he realized that leasing helps low income people to get solar and leasing companies employ a lot of people doing installations. But he pushed to limit leased systems to 50% of $22,500, also with phase-out by end of 2017. His latest wrinkle is to put in the legislation a requirement that equipment eligible for tax rebates must comply with the American Reinvestment and Recovery Act, meaning American made or purchased from any of a list of approved countries which does not include China.

HB 705 passed the Senate today, June 3, after extensive debate and four sets of amendments. It now goes back to the House. The House can vote to approve the Senate approved bill or throw it into conference committee because the bill differs significantly from what passed the House. No telling what could happen in conference committee but House and Senate would both have to approve a conference committee report before 6:00 pm on June 6 and it would have to be signed by the governor for the bill to become law. If all that happens we might get a bill that continues to support solar for a while but then phases out tax rebates. If all that does not happen then we get no bill at all and we end up back where we were, at least for another year, which was pretty good for solar. That would be a little worse on the state budget but not much in comparison to the billions in tax breaks annually doled out to oil and gas and numerous other industries. Stay tuned for further developments.

You can see the current bill and amendments at: http://www.legis.la.gov/Legis/BillInfo.aspx?i=222953

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