I 

108TH CONGRESS 

1ST SESSION H. R. 2838

To amend the Internal Revenue Code of 1986 to provide a credit for 

qualifying clean technology engines. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 23, 2003

Mr. RADANOVICH (for himself, Mr. NUNES, Mr. CARDOZA, Mr. OSE, and Mr. 

DOOLEY of California) introduced the following bill; which was referred 

to the Committee on Ways and Means 

A BILL

To amend the Internal Revenue Code of 1986 to provide 

a credit for qualifying clean technology engines.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Clean Engine Tech5 nology Act of 2003’’. 

6 SEC. 2. CREDIT FOR QUALIFYING CLEAN TECHNOLOGY EN7 GINES. 

8 (a) IN GENERAL.—Subpart B of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 
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1 1986 (relating to foreign tax credit, etc.) is amended by 

2 adding at the end the following new section: 

3 ‘‘SEC. 30B. CREDIT FOR QUALIFYING CLEAN TECHNOLOGY 

4 ENGINES. 

5 ‘‘(a) CREDIT ALLOWED.—There shall be allowed as 

6 a credit against the tax imposed by this chapter for the 

7 taxable year an amount equal to 25 percent of the cost 

8 of each qualifying clean technology engine placed in serv9 ice during the taxable year by any taxpayer in connection 

10 with such taxpayer’s trade or business. 

11 ‘‘(b) LIMITATION.—

12 ‘‘(1) IN GENERAL.—The credit allowed under 

13 subsection (a) shall not exceed $15,000 for any tax14 payer for any taxable year. 

15 ‘‘(2) MAXIMUM CREDIT PER TON.—The credit 

16 allowed under subsection (a) shall not exceed 

17 $13,600 for each ton of emissions eliminated, as de18 termined by regulations promulgated by the Sec19 retary. 

20 ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur21 poses of this section—

22 ‘‘(1) QUALIFYING CLEAN TECHNOLOGY EN23 GINE.—

24 ‘‘(A) IN GENERAL.—The term ‘qualifying 

25 clean technology engine’ means an engine—
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1 ‘‘(i) which replaces a diesel engine 

2 (which is not a qualifying clean technology 

3 engine) used by the taxpayer immediately 

4 before such engine is placed in service, 

5 ‘‘(ii) which is used—

6 ‘‘(I) in a heavy duty truck or a 

7 bus, or 

8 ‘‘(II) for off-highway use, 

9 ‘‘(iii) 75 percent of emissions from 

10 which are in an area designated as a se11 vere or extreme 1 hour ozone nonattain12 ment area (as determined by the Adminis13 trator of the Environmental Protection 

14 Agency) as of the date of the enactment of 

15 this section, 

16 ‘‘(iv) which—

17 ‘‘(I) emits at least 30 percent 

18 fewer ozone forming pollutants than 

19 the engine which it replaces, and 

20 ‘‘(II) meets any Federal and 

21 State pollution control requirements 

22 applicable to the year in which such 

23 engine is placed in service, and 
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1 ‘‘(v) which is certified as meeting the 

2 requirements of this section by the local air 

3 pollution control authority in such area. 

4 ‘‘(B) ENGINES IN NEW MOTOR VEHICLES

5 INCLUDED.—

6 ‘‘(i) IN GENERAL.—Such term in7 cludes an engine that otherwise meets the 

8 requirements of subparagraph (A) and is 

9 in a new motor vehicle purchased by the 

10 taxpayer which replaces a motor vehicle 

11 with a diesel engine (which is not a quali12 fying clean technology engine) used by the 

13 taxpayer immediately before such new 

14 motor vehicle is placed in service. 

15 ‘‘(ii) ENGINE IN NEW VEHICLE RE16 PLACES ENGINE IN OLD VEHICLE.—For 

17 purposes of this section, a qualifying clean 

18 technology engine in a new motor vehicle 

19 shall be considered to have replaced the en20 gine in the vehicle used by the taxpayer 

21 immediately before the new motor vehicle 

22 is placed in service. 

23 ‘‘(2) OLD ENGINE MUST BE DESTROYED.—No 

24 credit shall be allowed under subsection (a) unless 

25 the taxpayer destroys or otherwise retires the engine 
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1 which is replaced by the qualifying clean technology 

2 engine. 

3 ‘‘(d) APPLICATION WITH OTHER CREDITS.—The 

4 credit allowed under subsection (a) for any taxable year 

5 shall not exceed the excess (if any) of—

6 ‘‘(1) the regular tax for the taxable year re7 duced by the sum of the credits allowable under sub8 part A and sections 27, 29, and 30, over 

9 ‘‘(2) the tentative minimum tax for the taxable 

10 year. 

11 ‘‘(e) BASIS REDUCTION.—For purposes of this title, 

12 the basis of any property shall be reduced by the portion 

13 of the cost of such property taken into account under sub14 section (a). 

15 ‘‘(f) NO DOUBLE BENEFIT.—The amount of any de16 duction or other credit allowable under this chapter for 

17 any cost taken into account in computing the amount of 

18 the credit determined under subsection (a) shall be re19 duced by the amount of such credit attributable to such 

20 cost. 

21 ‘‘(g) CARRYBACK AND CARRYFORWARD ALLOWED.—

22 ‘‘(1) IN GENERAL.—If the credit allowable 

23 under subsection (a) for a taxable year exceeds the 

24 amount of the limitation under subsection (d) for 

25 such taxable year (in this paragraph referred to as 
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1 the ‘unused credit year’), such excess shall be a 

2 credit carryback to each of the 3 taxable years pre3 ceding the unused credit year and a credit 

4 carryforward to each of the 20 taxable years fol5 lowing unused credit year, except that no excess may 

6 be carried to a taxable year beginning before the 

7 date of the enactment of this paragraph. 

8 ‘‘(2) RULES.—Rules similar to the rules of sec9 tion 39 shall apply with respect to the credit 

10 carryback and credit carryforward under paragraph 

11 (1). 

12 ‘‘(h) OTHER SPECIAL RULES.—Rules similar to the 

13 rules of paragraphs (4) and (5) of section 179A(e) shall 

14 apply. 

15 ‘‘(i) REGULATIONS.—The Secretary shall, after con16 sulting with the Administrator of the Environmental Pro17 tection Agency and the California Air Resources Board, 

18 prescribe such regulations as necessary to carry out the 

19 provisions of this section. 

20 ‘‘(j) TERMINATION.—This section shall not apply to 

21 any property placed in service after December 31, 2009.’’. 

22 (b) CONFORMING AMENDMENTS.—

23 (1) Section 1016(a) of such Code is amended 

24 by striking ‘‘and’’ at the end of paragraph (27), by 

25 striking the period at the end of paragraph (28) and 
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1 inserting ‘‘, and’’, and by adding at the end the fol2 lowing new paragraph: 

3 ‘‘(29) to the extent provided in section 

4 30B(e).’’. 

5 (2) Section 55(c)(2) of such Code is amended 

6 by inserting ‘‘30B(d),’’ after ‘‘30(b)(3),’’. 

7 (3) The table of sections for subpart B of part 

8 IV of subchapter A of chapter 1 of such Code is 

9 amended by inserting after the item relating to sec10 tion 30A the following new item:

‘‘30B. Credit for qualifying clean technology engines.’’.

11 (c) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to property placed in service after 

13 the date of the enactment of this Act, in taxable years 

14 ending after such date.

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