I 

109TH CONGRESS 

2D SESSION H. R. 5027 

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

tax proportional to the number of million British thermal units of natural 

gas produced by a high Btu fuel facility. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 28, 2006 

Mr. JINDAL 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 against tax proportional to the number of million 

British thermal units of natural gas produced by a high 

Btu fuel facility. 

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 ‘‘Landfill Gas Act of 

5 2006’’. 

6 SEC. 2. CREDIT FOR PRODUCTION OF NATURAL GAS. 

7 (a) ALLOWANCE OF CREDIT.—Subpart D of part IV 

8 of subchapter A of chapter 1 of the Internal Revenue Code 


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•HR 5027 IH 

1 of 1986 (relating to business related credits) is amended 

2 by inserting after section 45M the following new section: 

3 ‘‘SEC. 45N. CREDIT FOR PRODUCTION OF NATURAL GAS. 

4 ‘‘(a) IN GENERAL.—For purposes of section 38, in 

5 the case of a taxpayer, the amount of the natural gas pro6 duction credit determined under this section for a taxable 

7 year is equal to the product of— 

8 ‘‘(1) $2, multiplied by 

9 ‘‘(2) the million British thermal units of nat10 ural gas produced by the taxpayer at a high Btu fuel 

11 facility during the taxable year. 

12 ‘‘(b) REDUCTION IN CREDIT AMOUNT AS NATURAL

13 GAS PRICES INCREASE.—For purposes of this section, on 

14 the first day of the production month following the date 

15 on which the spot price of natural gas delivered at Henry 

16 Hub, Louisiana, on average, exceeds $6 per million British 

17 thermal units for 30 consecutive trading days, the $2 

18 amount under subsection (a) shall be reduced (but not 

19 below zero) by an amount which is equal to the amount 

20 by which such spot price exceeds $6 per million British 

21 thermal units. 

22 ‘‘(c) HIGH BTU FUEL FACILITY.—For purposes of 

23 this section— 


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•HR 5027 IH 

1 ‘‘(1) IN GENERAL.—The term ‘high Btu fuel fa2 cility’ means a facility that produces high Btu bio3 mass fuel. 

4 ‘‘(2) HIGH BTU BIOMASS FUEL.—The term 

5 ‘high Btu biomass fuel’ means fuel produced from 

6 biomass (as defined in section 45K(c)(3)) that— 

7 ‘‘(A) contains no more than 7 pounds of 

8 water per million standard cubic feet, 

9 ‘‘(B) contains not less than 95 percent 

10 methane per volume, and 

11 ‘‘(C) has a Btu content of at least 950 per 

12 square cubic feet. 

13 ‘‘(d) OTHER RULES TO APPLY.—Rules similar to the 

14 rules of paragraphs (1), (3), (4), and (5) of section 45(e) 

15 shall apply for purposes of this section.’’. 

16 (b) CREDIT TO BE PART OF GENERAL BUSINESS

17 CREDIT.—Subsection (b) of section 38 of such Code (re18 lating to general business credit) is amended by striking 

19 ‘‘and’’ at the end of paragraph (29), by striking the period 

20 at the end of paragraph (30) and inserting ‘‘, and’’, and 

21 by adding at the end the following new paragraph: 

22 ‘‘(31) the natural gas production credit deter23 mined under section 45N(a).’’. 

24 (c) CONFORMING AMENDMENT.—The table of sec25 tions for subpart D of part IV of subchapter A of chapter 


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•HR 5027 IH 

1 1 of such Code is amended by inserting after the item 

2 relating to section 45M the following new item: 

‘‘Sec. 45N. Credit for production of natural gas.’’. 

3 (d) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to the production of natural gas 

5 in taxable years beginning after December 31, 2006. 

Æ 


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