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Committee backs drafting a bill to let large projects amortize state sales and use taxes
Summary
Lawmakers asked staff to prepare an updated draft of a 2021 proposal (SF 61) allowing amortization of certain sales-and-use taxes for large projects, limiting amortization to state shares and requiring lien/surety protections; committee discussed whether local governments should be able to opt in.
The Minerals, Business & Economic Development Committee asked staff to prepare a revised draft of a sales‑and‑use tax amortization bill previously considered in 2021, a proposal intended to help very large projects spread upfront sales and use tax obligations over time.
Staff member Brian Grenbick reviewed the prior concept: qualifying projects would have expenditures exceeding $5 million in the first two years and could apply to the Department of Revenue for a negotiated amortization schedule covering the portion of sales tax distributed to state accounts (not local shares). A lien or first‑priority security interest would protect the state's interest during the amortization term.
Cochair Burkhart and other senators said the proposal is not a tax cut but a cash‑flow tool for billion‑dollar projects, noting examples where projects must find hundreds of millions for initial taxes. Senator Rothfuss urged a working group and stakeholder outreach to resolve concerns raised during the bill's previous consideration, including local governments' interest in opting into amortization for their share of revenue.
The committee approved a staff request to draft language that includes staff comments and agency suggestions and signaled willingness to convene a working group to resolve outstanding issues, including how local opt‑in mechanics and lien/surety provisions would work.
What to watch: staff will prepare a draft derived from SF 61 for the July meeting; committee members asked for early stakeholder engagement so drafting can be completed with time for public posting.
