I
106TH CONGRESS
2D SESSION
H. R. 5226
To amend the Internal Revenue Code of 1986 to provide a credit for elec-
tricity produced by certain waste management facilities in United States
possessions, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 20, 2000
Mrs. CHRISTENSEN (for herself, Mr. RANGEL, and Mr. JEFFERSON) intro-
duced 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 electricity produced by certain waste manage-
ment facilities in United States possessions, and for
other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Possessions Waste
Management Improvement Act of 2000’’.
SEC. 2. ELECTRICITY PRODUCED FROM CERTAIN WASTE
MANAGEMENT FACILITIES IN A POSSESSION.
(a) AMOUNT OF CREDIT.—Subsection (b) of section
38 of the Internal Revenue Code of 1986 (defining current
year business credit) is amended by striking ‘‘plus’’ at the
end of paragraph (11), by striking the period at the end
of paragraph (12) and inserting ‘‘, plus’’, and by adding
at the end the following new paragraph:
‘‘(13) the possessions waste management elec-
tricity production credit determined under section
45D(a).’’.
(b) POSSESSIONS
WASTE
MANAGEMENT
ELEC-
TRICITY PRODUCTION CREDIT.—Subpart D of part IV of
chapter 1 of subtitle A of the Internal Revenue Code of
1986 (relating to business related credits) is amended by
adding at the end the following new section:
‘‘SEC. 
45D. 
ELECTRICITY 
PRODUCED 
FROM 
CERTAIN
WASTE MANAGEMENT FACILITIES IN A POS-
SESSION.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the possessions waste management electricity production
credit for any taxable year is an amount equal to the prod-
uct of—
‘‘(1) 7.5 cents, multiplied by
‘‘(2) the kilowatt hours of electricity produced
by the taxpayer at a qualified facility during the tax-
able year.
‘‘(b) LIMITATIONS AND ADJUSTMENTS.—
‘‘(1) CREDIT ADJUSTMENT BASED ON INFLA-
TION.—
‘‘(A) IN GENERAL.—The 7.5 cent amount
in subsection (a) shall be adjusted by multi-
plying such amount by the inflation adjustment
factor for the calendar year in which the pro-
duction occurs. If any amount as increased
under the preceding sentence is not a multiple
of 0.1 cent, such amount shall be rounded to
the nearest multiple of 0.1 cent.
‘‘(B) COMPUTATION
OF
INFLATION
AD-
JUSTMENT FACTOR.—For purposes of this sec-
tion, the inflation adjustment factor shall be the
same as that defined in section 45(d)(2).
‘‘(2) RELATED PERSONS AND CONSUMPTION BY
QUALIFIED FACILITY.—The amount of credit deter-
mined under subsection (a) shall not be reduced by
the amount of electricity either sold or provided to
related persons or expended by the qualified facility
itself.
‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
‘‘(1) QUALIFIED FACILITY.—The term ‘quali-
fied facility’ means any facility—
‘‘(A) which is located in a possession of the
United States,
‘‘(B) the purpose of which is to provide
waste management services for residents (in-
cluding both individuals and business entities)
of the possession without requiring the use of a
landfill, and
‘‘(C) which is put in service after October
1, 2002, pursuant to a procurement request—
‘‘(i) issued after January 1, 2000, by
a governmental entity of the possession (or
its agent), and
‘‘(ii) the response to which was due
before June 30, 2000.
‘‘(2) POSSESSION.—The term ‘possession of the
United States’ means Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands,
and the United States Virgin Islands.
‘‘(d) COORDINATION WITH OTHER PROVISIONS.—
‘‘(1) PASSIVE
ACTIVITY
LIMITATION.—Section
469 shall not apply to any credit amount determined
under this section.
‘‘(2) AT RISK LIMITATION.—Section 465 shall
not apply to any qualified facility.’’.
(c) CREDIT ALLOWED AGAINST REGULAR AND MIN-
IMUM TAX.—
(1) IN GENERAL.—Subsection (c) of section 38
of such Code (relating to limitation based on amount
of tax) is amended by redesignating paragraph (3)
as paragraph (4) and by inserting after paragraph
(2) the following new paragraph:
‘‘(3) SPECIAL RULES FOR POSSESSIONS WASTE
MANAGEMENT ELECTRICITY PRODUCTION CREDIT.—
‘‘(A) IN GENERAL.—In the case of the pos-
sessions waste management electricity produc-
tion credit—
‘‘(i) this section and section 39 shall
be applied separately with respect to the
credit, and
‘‘(ii) in applying paragraph (1) to the
credit—
‘‘(I) subparagraphs (A) and (B)
thereof shall not apply, and