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Session of 2026
SENATE BILL No. 534
By Committee on Assessment and Taxation
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AN ACT concerning taxation; relating to excise taxes; imposing a
nameplate capacity tax and a production tax upon certain wind farms
and solar facilities; crediting the nameplate capacity tax and production
tax revenue to the property tax relief fund; relating to property tax;
creating the property tax relief fund; transferring moneys from the
property tax relief fund to the state school district finance fund;
decreasing the statewide property tax levy for schools; amending
K.S.A. 2025 Supp. 72-5142 and repealing the existing section.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. As used in sections 1 through 3, and amendments
thereto:
(a) "Collector system" means all property used or constructed to
interconnect individual wind turbines or solar panels within a renewable
energy facility into a common project, including inverters, step-up
transformers, electrical collection equipment, collector substation
transformers and communication systems.
(b) "Company" means any natural person, firm, partnership,
corporation, limited liability company, association, company, political
subdivision, cooperative corporation, rural electric cooperative, any entity
or any group or combination acting as a unit.
(c) "Director" means the director of taxation.
(d) "Nameplate capacity" means the number of kilowatts a renewable
energy facility can produce, as assigned to the power units in the
renewable energy facility by the manufacturer and determined by the
secretary.
(e) "Renewable energy facility" means any wind farm or solar
facility.
(f) "Secretary" means the secretary of revenue.
(g) "Solar facility" means all real or personal property used or
constructed for the purpose of producing electricity for commercial
purposes utilizing solar radiation as an energy source and with a nameplate
capacity of at least 5,000 kilowatts. "Solar facility" includes the collector
system.
(h) "Wind farm" means all real or personal property used or
constructed for the purpose of producing electricity for commercial
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purposes utilizing the wind as an energy source and with a nameplate
capacity of at least 5,000 kilowatts. "Wind farm" includes the collector
system.
New Sec. 2. (a) There is hereby imposed an excise tax for the
privilege of constructing and operating a renewable energy facility for
commercial purposes in this state. Any company owning, controlling,
managing or leasing any real or personal property used or intended for use
as a wind farm or a solar facility shall pay an annual tax equal to $4 per
kilowatt multiplied by the nameplate capacity of the renewable energy
facility.
(b) (1) The tax imposed by this section shall be due and payable on or
before February 1 of the following year. The tax shall be imposed
beginning the first calendar year that the renewable energy facility
generates gross receipts. The tax for the first calendar year shall be
prorated based upon the percentage of the calendar year remaining after
the renewable energy facility generates gross receipts. For any renewable
energy facility first generating gross receipts prior to January 1, 2027, the
company shall first be subject to the tax for the taxable year commencing
on January 1, 2027. If a renewable energy facility is decommissioned, the
tax shall be prorated for the calendar year that the renewable energy
facility is decommissioned based upon the percentage of the calendar year
that the renewable energy facility was not decommissioned.
(2) Tax payments shall be made to the director and accompanied by a
return upon forms prescribed and furnished by the director. The return
shall contain all information that may be required by the director to
determine the amount of tax due.
(c) The provisions of K.S.A. 79-3226, 79-3228, 79-3228a, 79-3229,
79-3230, 79-3233, 79-3233a, 79-3233b, 79-3233g, 79-3233h, 79-3233i,
79-3234, 79-3235 and 79-3236, and amendments thereto, relating to the
administration, enforcement and collection of income tax shall apply to
this section insofar as practicable. The secretary may adopt such rules and
regulations as necessary for the efficient and effective administration,
enforcement and collection of the tax imposed by this section.
(d) The director shall remit all moneys collected from the tax
imposed by this section to the state treasurer in accordance with the
provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury to the credit of the property tax relief fund.
(e) The provisions of this section shall apply to all taxable years
commencing after December 31, 2026.
New Sec. 3. (a) There is hereby imposed an excise tax upon the
production of electricity in this state using a renewable energy facility. Any
company owning, controlling, managing or leasing any real or personal
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property used or intended for use as a wind farm or a solar facility shall
pay an annual tax equal to $0.001 per kilowatt hour of electricity produced
by the renewable energy facility during the calendar year.
(b) The tax imposed by this section shall be due and payable on or
before February 1 of the following year. Tax payments shall be made to the
director and accompanied by a return upon forms prescribed and furnished
by the director. The return shall include the amount of electricity in
kilowatt hours that was produced by the renewable energy facility during
the taxable year and contain all information that may be required by the
director to determine the amount of tax due.
(c) The provisions of K.S.A. 79-3226, 79-3228, 79-3228a, 79-3229,
79-3230, 79-3233, 79-3233a, 79-3233b, 79-3233g, 79-3233h, 79-3233i,
79-3234, 79-3235 and 79-3236, and amendments thereto, relating to the
administration, enforcement and collection of income tax shall apply to
this section insofar as practicable. The secretary may adopt such rules and
regulations as necessary for the efficient and effective administration,
enforcement and collection of the tax imposed by this section.
(d) The director shall remit all moneys collected from the tax
imposed by this section to the state treasurer in accordance with the
provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury to the credit of the property tax relief fund.
(e) The provisions of this section shall apply to all taxable years
commencing after December 31, 2026.
New Sec. 4. (a) There is hereby established in the state treasury the
property tax relief fund. The property tax relief fund shall be administered
by the state treasurer. All expenditures from the property tax relief fund
shall be for the purposes of the state school district finance fund
established by K.S.A. 72-5133, and amendments thereto, and reductions of
the property tax levied by school districts pursuant to K.S.A. 72-5142, and
amendments thereto. All expenditures from such fund shall be made in
accordance with appropriations acts upon warrants of the director of
accounts and reports issued pursuant to vouchers approved by the state
treasurer or the state treasurer's designee.
(b) Moneys in the property tax relief fund shall be used for the
purposes of the state school district finance fund established by K.S.A. 72-
5133, and amendments thereto. The director of accounts and reports shall
transfer all moneys in the property tax relief fund to the state school
district finance fund on or before the 15th day of each month.
Sec. 5. K.S.A. 2025 Supp. 72-5142 is hereby amended to read as
follows: 72-5142. (a) The board of education of each school district shall
levy an ad valorem tax upon the taxable tangible property of the school
district in the school years specified in subsection (b) for the purpose of:
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(1) Financing that portion of the school district's general fund budget
that is not financed from any other source provided by law;
(2) paying a portion of the costs of operating and maintaining public
schools in partial fulfillment of the constitutional obligation of the
legislature to finance the educational interests of the state; and
(3) with respect to any redevelopment school district established prior
to July 1, 1997, pursuant to K.S.A. 12-1771, and amendments thereto,
paying a portion of the principal and interest on bonds issued by cities
under authority of K.S.A. 12-1774, and amendments thereto, for the
financing of redevelopment projects upon property located within the
school district.
(b) The tax required under subsection (a) shall be levied at a rate of
20 mills in the school years 2025-2026 and 2026-2027 and at a rate of
19.5 mills in the school years 2027-2028 and 2028-2029.
(c) The proceeds from the tax levied by a district under authority of
this section, except the proceeds of such tax levied for the purpose
described in subsection (a)(3), shall be remitted to the state treasurer in
accordance with the provisions of K.S.A. 75-4215, and amendments
thereto. Upon receipt of each such remittance, the state treasurer shall
deposit the entire amount in the state treasury to the credit of the state
school district finance fund.
(d) No school district shall proceed under K.S.A. 79-1964, 79-1964a
or 79-1964b, and amendments thereto.
Sec. 6. K.S.A. 2025 Supp. 72-5142 is hereby repealed.
Sec. 7. This act shall take effect and be in force from and after its
publication in the statute book.
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