I
106TH CONGRESS
2D SESSION
H. R. 5531
To amend the Internal Revenue Code of 1986 to impose a windfall profit
tax on electricity, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 24, 2000
Mr. KUCINICH (for himself and Mr. FILNER) introduced the following bill;
which was referred to the Committee on Ways and Means, and in addi-
tion to the Committee on Commerce, for a period to be subsequently de-
termined by the Speaker, in each case for consideration of such provisions
as fall within the jurisdiction of the committee concerned
A BILL
To amend the Internal Revenue Code of 1986 to impose
a windfall profit tax on electricity, 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 ‘‘Electricity Price Spike
Act of 2000’’.
SEC. 2. WINDFALL PROFITS TAX.
(a) IN GENERAL.—Subtitle E of the Internal Rev-
enue Code of 1986 (relating to alcohol, tobacco, and cer-
tain other excise taxes) is amended by adding at the end
thereof the following new chapter:
‘‘CHAPTER 55—WINDFALL PROFIT ON
ELECTRICITY
‘‘Sec. 5886. Imposition of tax.
‘‘SEC. 5886. IMPOSITION OF TAX.
‘‘(a) IN GENERAL.—In addition to any other tax im-
posed under this title, there is hereby imposed an excise
tax on the sale in the United States of any electricity equal
to the applicable percentage of the windfall profit on such
sale.
‘‘(b) DEFINITIONS.—For purposes of this section—
‘‘(1) WINDFALL PROFIT.—The term ‘windfall
profit’ means, with respect to any sale, so much of
the profit on such sale as exceeds a reasonable prof-
it.
‘‘(2) APPLICABLE
PERCENTAGE.—The term
‘applicable percentage’ means—
‘‘(A) 50 percent to the extent that the
profit on the sale exceeds 100 percent of the
reasonable profit on the sale but does not ex-
ceed 102 percent of the reasonable profit on the
sale,
‘‘(B) 75 percent to the extent that the
profit on the sale exceeds 102 percent of the
reasonable profit on the sale but does not ex-
ceed 105 percent of the reasonable profit on the
sale, and
‘‘(C) 100 percent to the extent that the
profit on the sale exceeds 105 percent of the
reasonable profit on the sale.
‘‘(4) REASONABLE PROFIT.—The term ‘reason-
able profit’ means the amount determined by the
Reasonable Profits Board to be a reasonable profit
on the sale.
‘‘(c) LIABILITY FOR PAYMENT OF TAX.—The taxes
imposed by subsection (a) shall be paid by the seller.’’
(b) CLERICAL AMENDMENT.—The table of chapters
for subtitle E of such Code is amended by adding at the
end the following new item:
‘‘Chapter 55. Windfall profit on electricity.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on the date of the enactment
of this Act.
SEC. 3. CREDIT FOR ENERGY EFFICIENCY IMPROVEMENTS
TO EXISTING HOMES.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to nonrefundable personal credits) is
amended by inserting after section 25A the following new
section:
‘‘SEC. 25B. ENERGY EFFICIENCY IMPROVEMENTS TO EXIST-
ING HOMES.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount
equal to 20 percent of the amount paid or incurred by
the taxpayer for qualified energy efficiency improvements
installed during such taxable year.
‘‘(b) LIMITATIONS.—
‘‘(1) MAXIMUM CREDIT.—The credit allowed by
this section with respect to a dwelling shall not ex-
ceed $2,000.
‘‘(2) PRIOR CREDIT AMOUNTS FOR TAXPAYER
ON SAME DWELLING TAKEN INTO ACCOUNT.—If a
credit was allowed to the taxpayer under subsection
(a) with respect to a dwelling in 1 or more prior tax-
able years, the amount of the credit otherwise allow-
able for the taxable year with respect to that dwell-
ing shall not exceed the amount of $2,000 reduced
by the sum of the credits allowed under subsection
(a) to the taxpayer with respect to the dwelling for
all prior taxable years.
‘‘(c) CARRYFORWARD OF UNUSED CREDIT.—If the
credit allowable under subsection (a) exceeds the limita-
tion imposed by section 26(a) for such taxable year re-
duced by the sum of the credits allowable under subpart
A of part IV of subchapter A (other than this section),
such excess shall be carried to the succeeding taxable year
and added to the credit allowable under subsection (a) for
such taxable year.
‘‘(d) QUALIFIED ENERGY EFFICIENCY IMPROVE-
MENTS.—For purposes of this section, the term ‘qualified
energy efficiency improvements’ means any energy effi-
cient building envelope component, and any energy effi-
cient heating, cooling, or water heating appliance, the in-
stallation of which, by itself or in combination with other
such components or appliances, is certified to improve the
annual energy performance of the existing home by at
least 30 percent, if—
‘‘(1) such component or appliance is installed in
or on a dwelling—
‘‘(A) located in the United States, and
‘‘(B) owned and used by the taxpayer as
the taxpayer’s principal residence (within the
meaning of section 121),
‘‘(2) the original use of such component or ap-
pliance commences with the taxpayer, and
‘‘(3) such component or appliance reasonably
can be expected to remain in use for at least 5
years.
Such certification shall be made by the contractor who in-
stalled such improvements, a local building regulatory au-
thority, or a qualified energy consultant (such as a utility
or an accredited home energy rating system provider).
‘‘(e) SPECIAL RULES.—
‘‘(1) TENANT-STOCKHOLDER IN COOPERATIVE
HOUSING CORPORATION.—In the case of an indi-
vidual who is a tenant-stockholder (as defined in sec-
tion 216) in a cooperative housing corporation (as
defined in such section), such individual shall be
treated as having paid his tenant-stockholder’s pro-
portionate share (as defined in section 216(b)(3)) of
the cost of qualified energy efficiency improvements
made by such corporation.
‘‘(2) CONDOMINIUMS.—
‘‘(A) IN GENERAL.—In the case of an indi-
vidual who is a member of a condominium man-
agement association with respect to a condo-
minium which he owns, such individual shall be
treated as having paid his proportionate share
of the cost of qualified energy efficiency im-
provements made by such association.
‘‘(B) CONDOMINIUM
MANAGEMENT
ASSO-
CIATION.—For purposes of this paragraph, the
term ‘condominium management association’
means an organization which meets the require-
ments of paragraph (1) of section 528(c) (other
than subparagraph (E) thereof) with respect to
a condominium project substantially all of the
units of which are used as residences.
‘‘(f) BASIS ADJUSTMENT.—For purposes of this sub-
title, if a credit is allowed under this section for any ex-
penditure with respect to any property, the increase in the
basis of such property which would (but for this sub-
section) result from such expenditure shall be reduced by
the amount of the credit so allowed.
‘‘(g) TERMINATION.—Subsection (a) shall apply to
qualified energy efficiency improvements installed during
the period beginning on January 1, 1999, and ending on
December 31, 2003.’’.
(b) CONFORMING AMENDMENTS.—
(1) Subsection (c) of section 23 of such Code
is amended by inserting ‘‘, section 25B, and section
1400C’’ after ‘‘other than this section’’.
(2) Subparagraph (C) of section 25(e)(1) of
such Code is amended by striking ‘‘section 23’’ and
inserting ‘‘sections 23, 25B, and 1400C’’.
(3) Subsection (d) of section 1400C of such
Code is amended by inserting ‘‘and section 25B’’
after ‘‘other than this section’’.
(4) Subsection (a) of section 1016 of such Code
is amended by striking ‘‘and’’ at the end of para-
graph (26), by striking the period at the end of
paragraph (27) and inserting ‘‘; and’’, and by add-
ing at the end the following new paragraph:
‘‘(28) to the extent provided in section 25B(f),
in the case of amounts with respect to which a credit
has been allowed under section 25B.’’.
(5) The table of sections for subpart A of part
IV of subchapter A of chapter 1 of such Code is
amended by inserting after the item relating to sec-
tion 25A the following new item:
‘‘Sec. 25B. Energy efficiency improvements to existing homes.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after De-
cember 31, 1998.
SEC. 4. CITIZENS’ UTILITY BOARDS.
(a) ESTABLISHMENT.—Unless already in existence,
each State shall create a not-for-profit membership cor-
poration to be known as the ‘‘Citizens’ Utility Board,
Inc.’’ herein referred to as the State CUB. An existing
not-for-profit membership corporation located in a State
may become the State CUB provided it meets all the re-
quirements of this section.
(b) MEMBERSHIP.—The membership of the State
CUB shall consist of all residential consumers of elec-
tricity 16 years of age or older who have contributed to
the State CUB an annual membership fee, provided, that
any person may resign from membership.
(c) DUTIES, RIGHTS, AND POWERS OF THE STATE
CUB.—
(1) DUTIES.—The State CUB shall—
(A) represent and promote the interests of
a State’s residential consumers of electricity,
and all actions by the State CUB under this
section shall be directed toward such duty;
(B) inform, insofar as possible, all residen-
tial consumers of electricity about the State
CUB, including the procedure for obtaining
membership in the State CUB;
(C) establish an annual membership fee
which shall be set at a level that provides suffi-
cient funding for the State CUB to effectively
perform its powers and duties, and is affordable
for as many electricity consumers as is possible,
but nevertheless is not less than $5; and
(D) have all rights and powers accorded
generally to, and be subject to all duties im-
posed generally upon, not-for-profit membership
corporations under the laws of a State.
(2) RIGHTS
AND
POWERS.—In addition, the
State CUB shall have the following rights and pow-
ers:
(A) To solicit and accept gifts, loans,
grants or other aid in order to support activities
concerning the interests of residential con-
sumers of electricity, except that the State
CUB may not accept gifts, loans or other aid
from any person or company that generates,
transmits, distributes, or supplies electricity, or
from any director, employee or agent or mem-
ber of the immediate family of a director, em-
ployee or agent of any company that generates,
transmits, distributes, or supplies electricity.
(B) To seek tax-exempt status under State
and Federal law.
(C) To conduct, support, and assist re-
search, surveys, investigations, planning activi-
ties, conferences, demonstration projects, and
public information activities concerning the in-
terests of residential consumers of electricity.
The State CUB may accept grants, contribu-
tions, and legislative appropriations for such ac-
tivities.
(D) To contract for services which cannot
reasonably be performed by its employees.
(E) To represent the interests of residen-
tial consumers of electricity before regulatory
agencies, legislative bodies and other public
bodies.
(F) To initiate, to intervene as a party, to
maintain, or to otherwise participate on behalf
of residential consumers of electricity in any
proceeding that affects the interests of residen-
tial consumers of electricity.
(G) To support or oppose ballot propo-
sitions concerning matters that it determines
may affect the interests of residential con-
sumers of electricity.
(3) The State CUB shall have, in addition to
the rights and powers enumerated in this section,
such other incidental rights and powers as are rea-
sonably necessary for the effective representation
and protection of the interests of residential con-
sumers of electricity.
(4) NONPOLITICAL.—The State CUB shall not
sponsor, endorse, or otherwise support, nor shall it
oppose, any political party or the candidacy of any
person for public office.
(d) STATE-ASSISTED FUNDRAISING BY THE STATE
CUB.—
(1) IN GENERAL.—(1) The State CUB shall
have the authority to prepare and furnish to any
State agency an enclosure that the State agency
shall include within any mailing designated by the
State CUB. The State CUB shall provide the agency
with any such enclosure at a time reasonably in ad-
vance of the mailing. The State CUB may not re-
quire any State agency to mail an enclosure more
than four times in any calendar year.
(2) LIMITATION.—Enclosures furnished by the
State CUB under this section shall be limited to so-
liciting information and money from consumers and
explaining—
(A) the purpose, history, nature, activities,
and achievements of the State CUB;
(B) that the State CUB is open to mem-
bership by residential consumers;
(C) that the State CUB is not connected
to any utility company or governmental agency;
(D) that the State CUB is a not-for-profit
corporation directed by its consumer members;
(E) the procedure for contributing to or
becoming a member of the State CUB; and
(F) the yearly membership fee.
(3) APPROVAL OF CONTENT OF ENCLOSURE.—
Prior to furnishing an enclosure to a State agency
for mailing, the State CUB shall seek and obtain the
approval of the appropriate State authority of the
content of the enclosure. The State authority shall
approve the enclosure if it determines that the
enclosure—
(A) is not false or misleading, and
(B) contains and is limited to the informa-
tion permitted by this section.
The State authority shall be deemed to have ap-
proved the enclosure unless it disapproves the enclo-
sure within 14 days of receipt.
(4) REIMBURSEMENT OF COSTS INCURRED.—
The State CUB shall reimburse each State agency
for all reasonable incremental costs incurred by the
State agency in complying with this section above
the agency’s normal mailing and handling costs, pro-
vided that—
(A) the State agency shall first furnish the
State CUB with an itemized accounting of such
additional costs; and
(B) the State CUB shall not be required to
reimburse the State agency for postage costs if
the weight of the State CUB’s enclosure does
not increase the cost of the State agency mail-
ing.
If the State CUB’s enclosure increases the cost of
the State agency mailing, then it will be required to
reimburse the State agency for postage cost over
and above what the agency’s postage cost would
have been without the State CUB’s enclosure.
SEC. 5. REASONABLE PROFITS BOARD.
(a) ESTABLISHMENT.—There is established an inde-
pendent board to be known as the ‘‘Reasonable Profits
Board’’ (hereafter in this section referred to as the
‘‘Board’’).
(b) DUTIES.—The Board shall make reasonable prof-
it determinations for purposes of applying section 5886
of the Internal Revenue Code of 1986 (relating to windfall
profit on electricity).
(c) ADVISORY COMMITTEE.—The Board shall be con-
sidered an advisory committee within the meaning of the
Federal Advisory Committee Act (5 U.S.C. App.).
(d) APPOINTMENT.—
(1) MEMBERS.—The Board shall be composed
of 3 members appointed by the President of the
United States.
(2) TERM.—Members of the Board shall be ap-
pointed for a term of 3 years.
(3) BACKGROUND.—The members shall have no
financial interests in any of the businesses for which
reasonable profits are determined by the Board.
(e) PAY AND TRAVEL EXPENSES.—
(1) PAY.—Notwithstanding section 7 of the
Federal Advisory Committee Act (5 U.S.C. App.),
members of the Board shall be paid at a rate equal
to the daily equivalent of the minimum annual rate
of basic pay for level IV of the Executive Schedule
under section 5315 of title 5, United States Code,
for each day (including travel time) during which the
member is engaged in the actual performance of du-
ties vested in the Board.
(2) TRAVEL EXPENSES.—Members shall receive
travel expenses, including per diem in lieu of subsist-
ence, in accordance with section 5702 and 5703 of
title 5, United States Code.
(f) DIRECTOR OF STAFF.—
(1) QUALIFICATIONS.—The Board shall appoint
a Director who has no financial interests in any of
the businesses for which reasonable profits are de-
termined by the Board.
(2) PAY.—Notwithstanding section 7 of the
Federal Advisory Committee Act (5 U.S.C. App.),
the Director shall be paid at the rate of basic pay
payable for level IV of the Executive Schedule under
section 5315 of title 5, United States Code.
(g) STAFF.—
(1) ADDITIONAL
PERSONNEL.—The Director,
with the approval of the Board, may appoint and fix
the pay of additional personnel.
(2) APPOINTMENTS.—The Director may make
such appointments without regard to the provisions
of title 5, United States Code, governing appoint-
ments in the competitive service, and any personnel
so appointed may be paid without regard to the pro-
visions of chapter 51 and subchapter III of chapter
53 of that title relating to classification and General
Schedule pay rates.
(3) DETAILEES.—Upon the request of the Di-
rector, the head of any Federal department or agen-
cy may detail any of the personnel of that depart-
ment or agency to the Board to assist the Board in
accordance with an agreement entered into with the
Board.
(4) ASSISTANCE.—The Comptroller General of
the United States may provide assistance, including
the detailing of employees, to the Board in accord-
ance with an agreement entered into with the Board.
(h) OTHER AUTHORITY.—
(1) EXPERTS AND CONSULTANTS.—The Board
may procure by contract, to the extent funds are
available, the temporary or intermittent services of
experts or consultants pursuant to section 3109 of
title 5, United States Code.
(2) LEASING.—The Board may lease space and
acquire personal property to the extent that funds
are available.
(i) FUNDING.—There are authorized to be appro-
priated such funds as are necessary to carry out this sec-
tion.
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