Wisconsin Legislature: Text

4. Detailed Explanation of Statutory Authority for the Rule (Including the Statutory Citation and Language)

Section 227.11 (2) (a), Stats. reads:

Each agency may promulgate rules interpreting the provisions of any statute enforced or administered by the agency, if the agency considers it necessary to effectuate the purpose of the statute . . .

Section 73.03 (1), Stats. reads:

[It shall be the duty of the department of revenue, and it shall have power and authority:] To have and exercise general supervision over the administration of the assessment and tax laws of the state, over assessors, boards of review, supervisors of equalization, and assessors of incomes, and over the county boards in the performance of their duties in making the taxation district assessment, to the end that all assessments of property be made relatively just and equal at full value and that all assessments of income may be legally and accurately made in substantial compliance with law.

Section 70.111 (18), Stats., as amended by 2013 Wisconsin Act 20, reads:

ENERGY SYSTEMS. Biogas or synthetic gas energy systems, solar energy systems, and wind energy systems. In this subsection, “biogas or synthetic gas energy system" means equipment which directly converts biomass, as defined under section 45K (c) (3) of the Internal Revenue Code, as interpreted by the Internal Revenue Service, into biogas or synthetic gas, equipment which generates electricity, heat, or compressed natural gas exclusively from biogas or synthetic gas, equipment which is used exclusively for the direct transfer or storage of biomass, biogas, or synthetic gas, and any structure used exclusively to shelter or operate such equipment, or the portion of any structure used in part to shelter or operate such equipment that is allocable to such use, if all such equipment, and any such structure, is located at the same site, and includes manure, substrate, and other feedstock collection and delivery systems, pumping and processing equipment, gasifiers and digester tanks, biogas and synthetic gas cleaning and compression equipment, fiber separation and drying equipment, and heat recovery equipment, but does not include equipment or components that are present as part of a conventional energy system. In this subsection, “synthetic gas" is a gas that qualifies as a renewable resource under s. 196.378 (1) (h) 1. h. In this subsection, “solar energy system" means equipment which directly converts and then transfers or stores solar energy into usable forms of thermal or electrical energy, but does not include equipment or components that would be present as part of a conventional energy system or a system that operates without mechanical means. In this subsection, “wind energy system" means equipment which converts and then transfers or stores energy from the wind into usable forms of energy, but does not include equipment or components that would be present as part of a conventional energy system.

The department is clearly tasked with administering the tax laws of the state, including personal property tax exemptions in Wis. Stat. s. 70.111 (18). The department finds that chapter Tax 12.50 is necessary to effectuate the purpose of Wis. Stat. s. 70.111 (18).

Section 73.03 (66), Stats. read:

[It shall be the duty of the department of revenue, and it shall have power and authority:] To promulgate rules to ensure that the payments under s. 79.10 (4) made from the appropriation account under s. 20.835 (3) (qb) are used exclusively for school levy tax credits granted to state residents.

2013 Wisconsin Act 20 repealed s. 73.03 (66), Stats. Therefore, the department no longer has the statutory authority for ss. Tax 20.01 to 20.03.

5. Estimate of Amount of Time that State Employees Will Spend Developing the Rule and of Other Resources Necessary to Develop the Rule

The department estimates it will take approximately 50 hours to develop the rule.

6. List with Description of all Entities that may be Affected by the Proposed Rule

Property owners, owners of biogas or synthetic gas energy systems.

7. Summary and Preliminary Comparison of any Existing or Proposed Federal Regulation that is Intended to Address the Activities to be Regulated by the Proposed Rule

Wis. Stat. s. 70.111 (18), as amended by 2013 Wisconsin Act 20, relies on the federal definition of biomass found in section 45K (c) (3) of the Internal Revenue Code, which reads:

The term “biomass" means any organic material other than—

(A) oil and natural gas (or any product thereof), and

(B) coal (including lignite) or any product thereof.

26 USC § 45K provides a federal income tax credit for producing fuel from a nonconventional source, including gas produced from biomass. Additionally, H.R. 860, Biogas Investment Tax Credit Act of 2013, was introduced by U.S. Rep. Kind this year. This bill would include biogas property for an energy credit towards federal taxes for any taxable year equal to ten percent of the amount of investment in each energy property placed in service during such taxable year.

Biogas and synthetic gas digesters are also regulated by federal air, solid waste, and water regulations, but these federal regulations have little impact on the department's application of state tax laws.

There are no federal regulations addressing the school levy tax credit or the activities for which the credit is available.

8. Anticipated Economic Impact of Implementing the Rule (Note if the Rule is Likely to Have a Significant Economic Impact on Small Businesses)

The proposed rule will have minimal or no economic impact.

The rule will have no economic impact on small business.

9. Contact Person

Nate Ristow, (608) 266-6466 or Dale Kleven, (608) 266-8253.

Revenue

117-13-old SS 117-13

This statement of scope was approved by the governor on August 21, 2013.

Rule No.

Amends sections Tax 61.02 (10) and 61.04 (1) (e) and creates section Tax 62.30.

Relating to

Lottery provisions.

1. Finding/Nature of the Emergency (Emergency Rule Only)

N/A.

2. Detailed Description of the Objective of the Proposed Rule

The proposed rule will amend ss. Tax 61.02 (10) and 61.04 (1) (e) to reflect changes made to Wis. Stat. s. 15.05 (3) (a) in 2013 Wisconsin Act 20.

The proposed rule will create s. Tax 62.30 to establish procedures under Wis. Stat. s. 565.30 (1) (d), as created by 2013 Wisconsin Act 20.

3. Description of Existing Policies Relevant to the Rule, New Policies Proposed to be Included in the Rule, and an Analysis of Policy Alternatives

Currently, ss. Tax 61.02 (10) and 61.04 (1) (e) refer to the “Executive Assistant" of the Department of Revenue. These references were made obsolete by 2013 Wisconsin Act 20 and will be replaced with the appropriate title pursuant to Wis. Stat. s. 15.05 (3) (a), as recreated by 2013 Wisconsin Act 20. The proposed rule will simply reflect legislative policy decisions.

The alternative is to leave the rules with an outdated reference.

2013 Wisconsin Act 20 amended Wis. Stat. s. 565.30 (1), creating the option for a deceased prize winner's estate to receive a lump sum payment of the prize winnings in lieu of continuing annuity payments. The statute directs the lottery administrator to establish procedures for persons to submit petitions to receive the lump sum payment. The proposed rule will create s. Tax 62.30 to establish clear procedures for estate representatives and beneficiaries seeking to convert lottery prize annuity payments to a lump sum. The proposed rule will not establish new policy, but merely facilitate the legislative policy decision to allow a prize winner's estate the option of converting annuity payments to a lump sum payment.

The policy alternatives are to provide a detailed explanation of the petition procedure, to provide a simple directive to a form provided by the administrator, or not to promulgate a rule, which is an alternative that may not adhere to Wis. Stat. s. 227.10 (1).

4. Detailed Explanation of Statutory Authority for the Rule (Including the Statutory Citation and Language)

Section 565.02 (4), Stats. reads:

The department may promulgate all of the following rules:

(a) Implementing the provisions of this chapter.

Section 565.05 (1), Stats., as revised by 2013 Wisconsin Act 20, reads:

No employee in the lottery division of the department or the secretary, deputy secretary, or assistant deputy secretary of revenue may do any of the following:

(a) Have a direct or indirect interest in, or be employed by, any vendor while serving as an employee in the lottery division of the department or as secretary, deputy secretary, or assistant deputy secretary of revenue or for 2 years following the person's termination of service.

(b) Have a direct or indirect interest in or be employed by a business which has entered into a retailer contract under s. 565.10.

(d) Accept or agree to accept money or any other thing of value from any vendor, retailer or person who has submitted a bid, proposal or application to be a vendor or retailer.

Section 15.05 (3) (a), Stats., as revised by 2013 Wisconsin Act 20, reads:

Each secretary may appoint an assistant deputy secretary to serve at his or her pleasure outside the classified service. The assistant deputy secretary shall perform duties as the secretary prescribes.

Tax 61.02 (10) and 61.04 (1) (e) implement the provisions of ch. 565, Stats. 2013 Wisconsin Act 20 changes to the titles in Wis. Stat. ss. 565.05 (1) and 15.05 (3) (a) need to be reflected in the department's rules.

Section 565.30 (1) (d), as created by 2013 Wisconsin Act 20, reads:

The administrator shall establish a procedure for submitting petitions under pars. (b) and (c).

Section 227.10 (1) reads:

Each agency shall promulgate as a rule each statement of general policy and each interpretation of a statute which it specifically adopts to govern its enforcement or administration of that statute.

The procedures to be established in s. Tax 62.30, pursuant to 565.30 (1) (d), Stats., will be generally applicable and are, therefore, properly promulgated as a rule under 227.10 (1), Stats. Additional statutory authority may be found in Wis. Stat. s. 565.02 (4), as the procedures will implement provisions of ch. 565, Stats.