Incentives for mineral exploration-2.

WORKING DRAFT
2005
STATE OF WYOMING
05LSO-0703.E1

HOUSE BILL
NO.
HB0345

Incentives for mineral exploration-2.

Sponsored by:
Representative(s) Miller, Buchanan, Cohee and Simpson

A BILL

for

AN ACT relating to taxation and revenue; providing for a severance tax credit for certain mineral exploration as specified; providing procedures; providing for a report; providing for rules and regulations; providing a repeal date; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.
W.S. 39
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105 by creating a new subsection (e), 39
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205 by creating a new subsection (m), 39
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305, 39
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14
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405, 39
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14
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505 by creating a new subsection (c), 39
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14
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605 and 39
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14
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705 are amended to read:

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105.

Exemptions.

(e)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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104(a)(ii) or (b)(ii). In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
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104(a)(ii) or (b)(ii) for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

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205.

Exemptions.

(m)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after any amounts of oil and gas have been produced which must be reported to the Wyoming oil and gas conservation commission;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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204(a)(ii). In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
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14
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204(a)(ii) for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

39
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305.

Exemptions.

(a)

Except as provided in subsection (b) of this section, t
here are no specific applicable provisions for exemptions for this chapter.

(b)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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304(a)(ii). In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
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304(a)(ii) for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

39
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405.

Exemptions.

(a)

Except as provided in subsection (b) of this section, t
here are no specific applicable provisions for exemptions for this chapter.

(b)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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404. In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
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14
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404 for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

39
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505.

Exemptions.

(c)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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504(a)(ii). In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
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14
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504(a)(ii) for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

39
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605.

Exemptions.

(a)

Except as provide in subsection (b) of this section, t
here are no specific applicable provisions for exemptions for this chapter.

(b)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
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14
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604. In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
‑
14
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604 for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

39
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14
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705.

Exemptions
.

(a)

Except as provided in subsection (b) of this section, t
here are no specific applicable provisions for exemptions for this article.

(b)

The following shall apply to the mineral exploration tax credit:

(i)

Any person conducting or funding certain mineral exploration activities which are performed on or for the benefit of land in this state for the purpose of determining the existence, location, quantity or quality of a locatable or leasable mineral deposit on private or public land may be eligible for a tax credit as provided by this subsection. The credit shall only be available for any mineral which is currently not being produced in the county in which the exploration activities occur. The mineral exploration activities eligible for the credit shall include:

(A)

Surveying by geophysical or geochemical methods;

(B)

Drilling an exploration hole;

(C)

Surface trenching and bulk sampling; or

(D)

Performing other exploratory work, including aerial photographs, geological and geophysical logging, sample analysis and metallurgical testing.

(ii)

An exploration incentive exemption may not be granted under paragraph (i) of this subsection for exploration activity described in that paragraph which occurs after a mining permit is issued for that mine by the Wyoming department of environmental quality;

(iii)

Any person wishing to obtain the credit authorized by this subsection shall submit data and information to the Wyoming geological survey office on a form and in such manner approved by the office. The application shall:

(A)

Include a list of expenditures qualifying for the credit authorized under this subsection in a manner approved by the office;

(B)

Describe the work accomplished during the year covered by the request, the number of employees, and the names and number of consultants;

(C)

Provide a detailed list or ledger of expenditures of the accomplishments described in subparagraph (B) of this paragraph and a list of exploration activity data to be provided to the office;

(D)

Provide a statement by a certified public accountant that expenditures are supported by receipts for all activities eligible for the credit under paragraph (i) of this subsection for each calendar year that these expenditures for a single exploration project equal or exceed forty thousand dollars ($40,000.00);

(E)

Include all exploration data generated tied to the Wyoming state plane coordinate system. Accuracy shall reflect the type of data collected and be consistent with industry standards as required by the office;

(F)

Such other items as the office by rule and regulation may reasonably require.

(iv)

Not more than ninety (90) days following completion and collection of the data and not later than December 31, all factual and interpretive data as required by this subsection shall be submitted to the office. The following shall apply:

(A)

All information shall be examined by the appropriate specialist in the office and a letter transmitted to the department of revenue either approving or denying the request for a tax credit. Any incomplete submission of data shall subject the application to denial;

(B)

Any submitted materials shall become the property of the state;

(C)

Any material submitted shall remain confidential until December 31 of the year following the year of the submission.

(v)

If the application for the tax credit is granted, the person obtaining the credit may apply the credit against the tax due under W.S. 39
‑
14
‑
704. In no event shall the credit taken against the severance tax due exceed the lesser of:

(A)

Fifty percent (50%) of the person's total tax liability under W.S. 39
‑
14
‑
704 for the calendar year; or

(B)

One hundred thousand dollars ($100,000.00) for any one (1) calendar year of production.

(vi)

The department of revenue shall promulgate reasonable rules and regulations for the implementation of this subsection;

(vii)

The department of revenue and the Wyoming geological survey office shall report jointly on the results of the credit authorized by this subsection annually on or before November 1 to the governor and the legislature.

Section 2.
Effective July 1, 2010, W.S. 39
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105(e), 39
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205(m), 39
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305(b), 39
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405(b), 39
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505(c), 39
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605(b) and 39
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705(b) are repealed.

Section 3.
This act is effective July 1, 2006.

(END)

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HB0345