KRS 154.27-060: Severance tax incentives.

(1) (a) Notwithstanding any other provision of KRS 134.580 or KRS Chapter 143, an

approved company that purchases or severs coal that:

1. Is subject to the tax imposed under KRS 143.020; and

2. Is used by the approved company exclusively as feedstock for an

alternative fuel facility, energy -efficient alternative fuel facility, or a

gasification facility;

may be eligible for an incentive in an amount up to eighty percent (80%) of

the taxes paid pursuant to KRS 143.020 on coal purchased or severed by the

approved company that is above the base amount.

(b) Notwithstanding any other provision of KRS 134.580 or KRS Chapter 143A,

an approved company that purchases or severs natural gas or natural gas

liquids on or after August 1, 2010, that:

1. Is subject to the tax imposed under KRS 143A.020; and

2. Is used by the approved company exclusively as feedstock for an

alternative fuel facility described in KRS 154.27-020(4)(d);

may be eligible for an incentive in an amount up to eighty percent (80%) of

the taxes paid pursuant to KRS 143A.020 on natural gas or natural gas liquids

purchased or severed by the approved company that is above the base amount.

(2) An approved company that has purchased or severed coal subject to the tax imposed

under KRS 143.020 or purchased or sever ed natural gas or natural gas liquids

subject to the tax imposed under KRS 143A.020 prior to the execution of a tax

incentive agreement shall not create an affiliate, subsidiary, corporation, or other

related entity that would result in a base amount of zero (0).

(3) The incentive may be requested beginning in the first calendar year after the

construction of a new facility or the upgrade or retrofit of an existing facility is

completed.

(4) Upon completion of the construction of a new alternative fuel faci lity, energy -

efficient alternative fuel facility, or gasification facility or the retrofit or upgrade of

an existing facility, an approved company shall notify the authority and the

department.

(5) The approved company may obtain the incentive on an annual basis by filing a

request for the incentive with the department as provided in KRS 143.024.

(6) The department shall notify the authority of the incentives requested and the

incentives distributed, upon request of the authority.