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Finance staff pursuing direct-pay tax credit reimbursements under Inflation Reduction Act for EVs and solar
Summary
Finance staff said the city is preparing to file for direct-pay reimbursements available under the Inflation Reduction Act for certain sustainable assets; staff identified eight electric vehicles and the Redmond Senior and Community Center solar arrays as eligible and said consultants are assisting with filings.
A Finance Department analyst told the committee on April 22 that the city is preparing to apply for direct-pay reimbursements under the Inflation Reduction Act for certain eligible green assets.
Ryan Edbertson (Finance) said municipalities cannot claim tax credits in the traditional way because they do not file federal income taxes, but the IRS program created by the Inflation Reduction Act allows a direct payment in lieu of tax credits through a ten-year program. Edbertson said the program’s administrative requirements are simpler than many grants but that eligible asset categories are narrow; solar panels, electric vehicles and charging stations are the most straightforward candidates for reimbursement. He said the city found eight electric vehicles and the solar array on the Redmond Senior and Community Center as potential claim items and that outside consultants and legal support (a state program named SETT CAP and consultants noted in the transcript) are assisting the city’s filings.
Edbertson said staff were collecting supporting documentation and hoped to file by the fifteenth of the month; if needed staff would request an extension. Councilmembers asked about the risks of the program being reduced in future federal actions; Edbertson said consultants anticipated funds would be available through the end of 2025 but cautioned that the program’s longevity could change.
Ending: Finance will assemble invoices and supporting documentation with consultant assistance and aim to file the direct-pay reimbursement application; staff will notify council when filings are submitted and if extensions are required.
