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Indicates Matter Stricken
Indicates New Matter
April 29, 2008
Introduced by Reps. Haley, Loftis, Cato, Walker, Merrill, Huggins, Hutson, Harrell, E.H. Pitts, Hodges, Spires, Bowen, Ballentine, Funderburk, Knight, Cobb-Hunter, Jefferson, Ott, Owens, Sandifer, J.R. Smith, Chalk, Hardwick, Brady, Whipper, R. Brown and Mitchell
S. Printed 4/29/08--H.
Read the first time March 26, 2008.
EXPLANATION OF IMPACT:
Department of Revenue
The department indicates enactment will have a minimal impact on expenditures that can be absorbed at the current level of funding.
State Budget and Control Board (Board)
A review of this bill by the board indicates there will be no impact on the General Fund of the State or on federal and/or other funds.
Office of State Budget
REVENUE IMPACT 1/
This bill is expected to reduce general fund income tax revenue by an estimated $500,000 in FY2008-09.
This bill would add Section 12-6-3640 to allow a residential homebuilder or developer who constructs a "high-performance" residence that is designed, constructed, and certified as receiving the National Green Build Program certified rating, the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) certified rating, or the EarthCraft certified rating, whichever is applicable, a nonrefundable state income tax credit of $1,000 per qualified residence. A "high-performance" structure is one that minimizes its impact on the environment through an integrated system of design. The credit must be claimed in the year that the residence receives certification. The nonrefundable income tax credit applies only to high-performance residences certified between July 1, 2008 and July 1, 2016. The South Carolina Energy Office may petition the General Assembly to allow a residential building project to be certified and receive the tax credit by standards that are in addition to or instead of the certified standards allowed above. According to representatives with Southface Energy Institute, administrator of the EarthCraft House Program, by the end of calendar year 2008 an estimated 158 homes will have been constructed to Earthcraft standards in South Carolina. Based on sales forecasts, EarthCraft advises us that another 470 homes will be built in South Carolina in FY2008-09. Also, according to the U.S. Green Building Council, administrators of the LEED program, two homes have been built in South Carolina, with more planned as the program moves forward from its pilot phase of the program. Multiplying an estimated 500 homes by a $1,000 nonrefundable tax credit yields a reduction of general fund income tax revenue of an estimated $500,000 in FY2008-09. This bill would also amend Section 12-6-3587 to add an appropriately-numbered subsection to reinforce that a local government or homeowners association may not prohibit the installation of a solar energy heating or cooling system in a residential home. This would allow homeowners to install solar panels to provide heating and cooling systems to their homes in lieu of homeowners association's restrictive covenants and architectural standards monitored by local government subdivision review boards.
William C. Gillespie
Board of Economic Advisors
1/ This statement meets the requirement of Section 2-7-71 for a state revenue impact by the BEA, or Section 2-7-76 for a local revenue impact or Section 6-1-85(B) for an estimate of the shift in local property tax incidence by the Office of Economic Research.
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-6-3640 SO AS TO CREATE THE "ENERGY INDEPENDENCE AND SUSTAINABLE HOMES ACT"; TO AMEND SECTION 12-6-3587, AS AMENDED, RELATING TO THE PURCHASE AND INSTALLATION OF CERTAIN SOLAR ENERGY HEATING OR COOLING SYSTEMS, SO AS TO PROVIDE A LOCAL GOVERNMENT OR HOMEOWNERS ASSOCIATION MAY NOT PROHIBIT THE INSTALLATION OF A SOLAR ENERGY HEATING OR COOLING SYSTEM IN A RESIDENTIAL HOME.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. This act may be cited as the "Energy Independence and Sustainable Homes Act".
SECTION 2. A. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3640. (A) As used in this section:
(1) 'EarthCraft House' means the residential green building program created by the Greater Atlanta Home Builders Association in partnership with Southface Energy Institute.
(2) 'EarthCraft certified' means the minimum certification standard as set forth by the EarthCraft House for New Construction rating system.
(3) 'High-performance residence' means a residence designed to achieve integrated systems design and construction so as to significantly reduce or eliminate the impact of the residence on the environment.
(4) 'LEED' means the U.S. Green Building Council's Leadership in Energy and Environmental Design rating system.
(5) 'LEED certified' means the minimum certification standard as set forth by the LEED for Homes rating system.
(6) 'NAHB National Green Build Program' means the residential green building program created by the National Home Builders Association to promote energy conservation.
(7) 'National Green Build Program certified' means the minimum certification standard set forth by the National Green Build Program rating system.
(8) 'Residential building project' means the design and construction of any inhabited physical structure used for residential purposes and its associated project building site.
(9) 'Residential builder' means a licensed residential builder as defined in Section 40-59-20.
(10) 'USGBC' means the United States Green Building Council.
(B) The purpose of this section is to promote effective energy and environmental standards for the construction of homes in this State, and to improve the state's capacity to design, build, and operate high-performance residences and consequently create new jobs and increase economic growth and the state's energy independence. To accomplish these objectives, the State shall promote policies and procedures that:
(1) optimize the energy performance of homes throughout this State;
(2) increase the demand for environmentally-preferable building materials, finishes, and energy efficient appliances;
(3) improve environmental quality in this State by increasing the energy efficiency of homes and reducing waste produced in their manufacture;
(4) create public awareness of new technologies that can improve the health of citizens by meeting advanced criteria for indoor air quality;
(5) reduce the state's dependence upon imported sources of energy through homes that conserve energy and utilize local and renewable energy sources;
(6) protect and restore this state's natural resources by insuring the wise use of these resources in the construction of homes;
(7) increase the ability of municipal water and water treatment providers to serve additional customers by reducing the amount of potable water consumption per house;
(8) reduce waste generation and manage waste through recycling and diversion from landfill disposal;
(9) ensure homes in this State have building systems that are designed, installed, and tested to perform according to the building's design intent and its operational needs through third-party, post-construction review and verification;
(10) promote the voluntary construction of affordable, energy efficient, and environmentally-sound homes;
(11) increase the quantity and quality of energy efficient and sustainable homes for homeowners of all income levels;
(12) support the use of green building materials and methods to the extent they are shown to be available, practical and cost efficient, yield ascertainable energy efficiency and other environmental benefits, and respect market conditions that preserve consumer housing options; and
(13) increase the number of new homes and subdivisions built to environmentally-sustainable standards by providing incentives to residential builders that can accelerate widespread acceptance of sustainable homes.
(C)(1) A residential builder who constructs a high-performance residence in this State that is designed, constructed, and certified as receiving the National Green Build Program certified rating, LEED certified rating, or receiving the EarthCraft certified rating is allowed a nonrefundable credit against state income taxes equal to one thousand dollars.
(2) A residential builder must claim the credit in the taxable year in which the high-performance residence receives certification. An unused portion of the credit may be carried forward for up to three consecutive tax years.
(3) To claim the credit allowed by this section, the residential builder must attach to the return a copy of the qualifying certification verifying that the high-performance residence has been certified in accordance with this section, along with all information that the Department of Revenue determines is necessary.
(4) The Department of Revenue annually shall submit a report regarding certified high-performance residences to the General Assembly that includes:
(a) the number of homes reported to the department as certified;
(b) the amount of credit claimed in the previous taxable year; and
(c) a conflict or barrier that hinders the effectiveness of this section.
(D) The South Carolina Energy Office may petition the General Assembly to allow a residential building project be certified to a high-performance residence rating system standard in addition to or instead of the systems provided in this section in order to receive the credit. However, an alternate rating system adopted by the General Assembly must be no less stringent than the rating systems provided in this section.
(E) The National Green Build Program, USGBC, or the EarthCraft House, whichever is applicable, shall have the sole discretion in determining whether a high-performance residence receives certification. The provisions of this section do not create a new cause of action against the State of South Carolina."
B. This section takes effect upon approval by the Governor and applies only to high-performance residences certified between July 1, 2008, and July 1, 2016.
SECTION 3. Section 12-6-3587 of the 1976 Code, as last amended by Act 116 of 2007, is further amended to read:
"(___) A local government or homeowners association may not impose a greater requirement on a person wishing to install a solar energy heating or cooling system in a residential home than it otherwise would impose on a person wishing to install another heating, cooling, or similar mechanical system."
SECTION 4. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.
SECTION 5. This act takes effect upon approval by the Governor.
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