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103D CONGRESS

1ST SESSION H. R. 2456

To amend the Internal Revenue Code of 1986 in order to provide an incentive

for business to invest in pollution abatement property and related assets.

IN THE HOUSE OF REPRESENTATIVES

JUNE 17, 1993

Mr. PAYNE of New Jersey introduced the following bill; which was referred

to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 in order to

provide an incentive for business to invest in pollution

abatement property and related assets.

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

3 SECTION 1. AMENDMENT OF DEPRECIATION RULES RELAT4 ING TO CERTAIN ENVIRONMENTAL PROP5 ERTY.

6 (a) GENERAL RULE.—Section 168(e)(3)(B) of the

7 Internal Revenue Code of 1986 is amended by striking

8 ‘‘and’’ at the end of clause (v), by striking the period at

9 the end of clause (vi) and inserting ‘‘, and’’, and by adding

10 after clause (vi) the following new clause:
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1 ‘‘(vii) any environmental property.’’

2 (b) ENVIRONMENTAL PROPERTY.—Section 168(i) of

3 such Code is amended by adding at the end thereof the

4 following new paragraph:

5 ‘‘(14) ENVIRONMENTAL PROPERTY.—The term

6 ‘environmental property’ means any identifiable item

7 of property—

8 ‘‘(A) which is used in connection with a

9 plant or other property in operation before Jan10 uary 1, 1994, to prevent, abate or control water

11 or atmospheric pollution or contamination by

12 removing, altering, disposing, storing or pre13 venting the creation or emission of pollutants

14 (including dust), contaminants, wastes, or heat,

15 and property which monitors the creation or

16 emission of pollutants (including dust), con17 taminants, wastes, or heat,

18 ‘‘(B) which does not significantly—

19 ‘‘(i) increase the output or capacity,

20 extend the useful life, or reduce the total

21 operating costs of such plant or other

22 property (or any unit thereof), or

23 ‘‘(ii) alter the nature of the manufac24 turing or production process or facility,

25 and
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1 ‘‘(C) which is not a building or its struc2 tural components, other than a building which

3 is exclusively a facility described in subpara4 graph (A).’’

5 (c) ALTERNATIVE DEPRECIATION SYSTEM.—Para6 graph (3) of section 168(g) of such Code is amended by

7 adding at the end thereof the following new subparagraph:

8 ‘‘(F) ENVIRONMENTAL PROPERTY.—In the

9 case of environmental property (other than

10 property described in subparagraph (A) or (D)

11 of paragraph (1)), the recovery period used for

12 purposes of paragraph (2) shall be—

13 ‘‘(i) 5 years if the average annual

14 gross receipts of the taxpayer for the 3

15 taxable years preceding the taxable year in

16 which the property is placed in service ex17 ceeds $250,000,000,

18 ‘‘(ii) 3 years if such average annual

19 gross receipts exceeds $100,000,000 but

20 does not exceed $250,000,000, and

21 ‘‘(iii) 1 year if such average annual

22 gross receipts does not exceed

23 $100,000,000.
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1 For purposes of the preceding sentence, rules

2 similar to the rules of paragraphs (2) and (3)

3 of section 448(c) shall apply.’’

4 (d) ALTERNATIVE MINIMUM TAX.—

5 (1) Paragraph (1)(B) of section 56(a) of such

6 Code is amended by inserting before the period ‘‘or

7 in paragraph (14) of section 168(i)’’.

8 (2) Paragraph (4)(A)(v) of section 56(g) of

9 such Code is amended by inserting ‘‘or in paragraph

10 (14) of section 168(i)’’ after ‘‘section 168(f)’’.

11 (e) REPEAL OF SECTION 169.—

12 (1) Section 169 of such Code is hereby re13 pealed.

14 (2) The table of sections for part VI of sub15 chapter B of chapter 1 of such Code is amended by

16 striking the item relating to section 169.

17 (f) EFFECTIVE DATE.—The amendments made by

18 this section shall apply to property placed in service after

19 December 31, 1993, in taxable years ending after such

20 date.

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