Extra Credit

By Bob Decker
January 12, 2009

On Friday, January 9, Sen. Christine Kaufmann (D-Helena) presented a bill to change the state income tax credit for energy conservation investments in a building. Sen. Kaufmann introduced the bill on behalf of the Environmental Quality Council, a bipartisan committee that meets between regular legislative sessions and of which Sen. Kaufmann is a member.

Under current law, taxpayers are allowed a state tax credit of 25 percent of the cost of projects to conserve energy in buildings. Someone who spends $1,000 on an insulation project may receive a $250 credit in paying state taxes. The maximum credit allowed is $500, so energy investments over $2,000 are limited to a credit of $500.

Sen. Kaufmann’s bill seeks to:

• increase the maximum credit from $500 per taxpayer to $800 per taxpayer;


• allow partnerships and S corporations to claim the credit for energy investments in rental buildings;


• expands the credit to include refrigeration and lighting conservation in rental buildings;


• make the credit refundable for low-income taxpayers (i.e., if a conservation credit due is greater than the total tax due of the filer, the state would refund the difference to the filer).

Linda Gryczan, working as a lobbyist for the National Center for Appropriate Technology, did a fine job of organizing proponents for the bill. Representatives of a handful of environmental organizations (Montana Audubon, Alternative Energy Resources Organization, Montana Conservation Voters, and Northern Plains Resource Council) spoke in favor of the bill, as did a local contractor.

Dale Horton, representing the National Center for Appropriate Technology, addressed the potential energy saving impacts of the bill, as well as probable economic benefits from local investments made in building contractor firms and material suppliers (doors, windows, insulation, and other building products).

Chris Dorsi, a partner in Saturn Energy, a Helena-based firm specializing in construction training, conservation consulting, and the publication of technical manuals, offered an articulate statement on how sizable savings of both energy and money can be realized through the execution of relatively simple building improvements.

David Scrimm, a Helena attorney, made a strong case for the economic benefits of conservation measures, then offered some amendments to the bill that would increase the credit from $800 (in Sen. Kaufmann's bill) to $1,000, allow year-to-year carryover of the credit, and include the purchase of energy-efficient appliances to be claimed for credit.

There were no opponents to the bill.

Sen. Jeff Essmann (R-Billings), the committee's chairman, made reference to the daunting budget situation faced by the Legislature and suggested that the bill would probably not see committee action in the near future.