wa-law.org > bill > 2025-26 > HB 2716 > Original Bill
Subject to the limitations in this section, a light and power business or a gas distribution business may take a credit each fiscal year against the tax imposed under this chapter.
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A credit may be taken for qualifying contributions if the dollar amount of qualifying contributions for the fiscal year in which the tax credit is taken is greater than 125 percent of the dollar amount of qualifying contributions given in fiscal year 2000.
If no qualifying contributions were given in fiscal year 2000, a credit is allowed for the first fiscal year that qualifying contributions are given. Thereafter, credit is allowed if the qualifying contributions given exceed 125 percent of qualifying contributions given in the first fiscal year.
The amount of credit is 50 percent of the dollar amount of qualifying contributions given in the fiscal year in which the tax credit is taken.
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A credit may be taken for billing discounts if the dollar amount of billing discounts for the fiscal year in which the tax credit is taken is greater than 125 percent of the dollar amount of billing discounts given in fiscal year 2000.
If no billing discounts were given in fiscal year 2000, a credit is allowed in the first fiscal year that billing discounts are given. Thereafter, credit is allowed if the dollar amount of billing discounts given exceeds 125 percent of billing discounts given in the first fiscal year.
The amount of credit is 50 percent of the dollar amount of the billing discounts given in the fiscal year in which the tax credit is taken.
The total amount of credit that may be taken for qualifying contributions and billing discounts in a fiscal year is limited to the base credit for the same fiscal year.
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The total amount of credit, statewide, that may be taken in any fiscal year may not exceed $2,500,000.
By May 1st of each year, the department of commerce shall notify the department in writing of the grants received in the current fiscal year by each light and power business and gas distribution business.
Within two weeks of May 8, 2027, the department of commerce shall notify the department in writing of the grants received in fiscal year 2027 by each light and power business and gas distribution business. Within four weeks of May 8, 2027, the department shall publish the base credit for each light and power business and gas distribution business for fiscal year 2027. Within eight weeks of May 8, 2027, application to the department must be made showing the information required in subsection (4)(b) of this section. Within 12 weeks of May 8, 2027, the department shall notify each applicant of the amount of credit that may be taken in fiscal year 2028.
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Not later than June 1st of each year beginning in 2028, the department shall publish the base credit for each light and power business and gas distribution business for the next fiscal year.
Not later than July 1st of each year beginning in 2028, application for credit must be made to the department including but not limited to the following information: Billing discounts given by the applicant in fiscal year 2000; qualifying contributions given by the applicant in the prior fiscal year; the amount of money received in the prior fiscal year from customers for the purpose of assisting other customers; the base credit for the next fiscal year for the applicant; the qualifying contributions anticipated to be given in the next fiscal year; and billing discounts anticipated to be given in the next fiscal year. No credit under this section is allowed to a light and power business or gas distribution business that does not file the application by July 1st.
Not later than August 1st of each year beginning in 2028, the department shall notify each applicant of the amount of credit that may be taken in that fiscal year.
The balance of base credits not used by other light and power businesses and gas distribution businesses must be ratably distributed to applicants under the formula in subsection (6)(a) of this section. The total amount of credit that may be taken by an applicant is the base credit plus any ratable portion of unused base credit.
The credit taken under this section is limited to the amount of tax imposed under this chapter for the fiscal year. The credit must be claimed in the fiscal year in which the billing reduction is made. Any unused credit expires. Refunds may not be given in place of credits.
The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
"Base credit" means the maximum amount of credit against the tax imposed by this chapter that each light and power business or gas distribution business may take each fiscal year as calculated by the department. The base credit is equal to the proportionate share that the total grants received by each light and power business or gas distribution business in the prior fiscal year bears to the total grants received by all light and power businesses and gas distribution businesses in the prior fiscal year multiplied by $2,500,000.
"Billing discount" means a reduction in the amount charged for providing service to qualifying persons in Washington made by a light and power business or a gas distribution business. "Billing discount" does not include grants received by the light and power business or a gas distribution business.
"Grant" means funds provided to a light and power business or gas distribution business by the department of commerce or by a qualifying organization.
"Low-income home energy assistance" means energy assistance programs for low-income households as defined on December 31, 2000, in the low-income home energy assistance act of 1981 as amended August 1, 1999, 42 U.S.C. Sec. 8623 et seq.
"Qualifying contribution" means money given by a light and power business or a gas distribution business to a qualifying organization, exclusive of money received in the prior fiscal year from its customers for the purpose of assisting other customers.
"Qualifying person" means a Washington resident who applies for assistance and qualifies for a grant regardless of whether that person receives a grant.
"Qualifying organization" means an entity that has a contractual agreement with the department of commerce to administer in a specified service area low-income home energy assistance funds received from the federal government and such other funds that may be received by the entity.
This section is the tax preference performance statement for the tax preference contained in section 1, chapter . . ., Laws of 2026 (section 1 of this act). This performance statement is only intended to be used for subsequent evaluation of the tax preference. It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.
The legislature categorizes the tax preference created under this act as intended to induce certain designated behavior by taxpayers as indicated in RCW 82.32.808(2)(a).
It is the legislature's specific public policy objective to:
Induce participating utilities to enhance offerings of energy assistance to customers who have exhausted other forms of energy assistance; and
To support the progress of making energy assistance funds available to low-income households consistent with RCW 19.405.120.
As part of its 2030 tax preference reviews, the joint legislative audit and review committee must review the tax preference in section 1 of this act and formerly RCW 82.16.0497. The legislature intends for the legislative auditor to determine that the incentive has achieved its desired outcomes if the following objectives are achieved:
Energy assistance is provided in an amount greater than amounts otherwise provided under other state, federal, and utility funded programs; or
Proceeds from the tax credit provided under section 1 of this act and formerly RCW 82.16.0497 are used to demonstrate progress toward making energy assistance funds available to low-income customers consistent the policies identified in RCW 19.405.120.
All recipients of tax credits or incentive payments awarded under section 1 of this act must provide data necessary to evaluate the tax preference performance objectives in this section as requested by the joint legislative audit and review committee. Failure to comply may result in the loss of a tax credit award or incentive payment in the following fiscal year. The joint legislative audit and review committee must notify the department of revenue by June 30th of each year if a light and power business credit, as established in section 1 of this act, is suspended due to failure to comply with providing data as required in this subsection.
RCW 82.32.805 does not apply to this act.
This act takes effect July 1, 2026.