The
Stimulus Bill aka
The "American Recovery and Reinvestment Act of 2009"
(ARRA)
ARRA
Signed into law on February 17, 2009.
407 pages (Pub. L. No. 111-5)
Stimulus funds applicable to biofuel projects disbursed through federal and
state agencies, especially US Dept of Energy.
ARRA
DOE Secretary Steven Chu has promised to Disperse 70% of the investment from
the ARRA plan by the end of 2010 (DOE Feb 19, 2009 Press Release.)
Three types of aid applicable to biofuel projects:
Tax Credits/Incentives
Loan Guarantees
Grants
Tax Credits/Incentives
ARRA extends Production Tax Credit (PTC)
To qualifying facilities placed in service through 2013. Includes "closed-loop"
and "open-loop" biomass
(as defined by Internal Revenue Code § 45(c)(1)(C),(c)(2)).
Can claim approx 2¢ per kilowatt hour of energy produced in first 10yrs
(Aaron
Ball, Looper Reed & McGraw, PC).
Credit must be claimed over first 10 year operating period.
ARRA creates option to claim Investment Tax Credit (ITC) instead of PTC.
Can claim ITC instead of PTC if placed in service between Jan 1, 2009 and Dec
31, 2013.
ITC allows credit to be claimed for the year placed in service.
ITC allows effectively 85% of facility cost to be depreciated (Aaron Ball, Looper
Reed & McGraw, PC).
Tax Credits/Incentives
(cont.)
Allows US Treasury Dept to issue grants in lieu of PTC and ITC.
Up to 30% of facility cost if placed in service or construction begins
before end of 2010.
Amount of grant generally equal to amount of ITC claimed.
Fed, state, local govt’s and tax-exempt entities not eligible.
Tax Credits/Incentives
(cont.)
Temp Business Credit Increase for Alternative Fuel Vehicle Refueling Property.
Increases tax credit for qualifying property cost from 30% to 50% (includes
biodiesel) if placed in service by 2010.
Cap on depreciable property increased from $30,000 to $50,000.
Cap on non-depreciable property increased from $1,000 to $2,000 if placed
in service by 2010.
Applies to taxable years beginning Jan. 1, 2009.
Tax Credits/Incentives
(cont.)
New 30% credit for a "qualifying advanced energy project."
Must be certified by Treasury Dept. and DOE. Cap
on depreciable property increased from $30,000 to $50,000.
Included are properties designed to produce energy from renewables, capture
carbon, refine blend fuel, or reduce greenhouse gases.
Up to $2.3 billion of credits can be certified.
Tax Credits/Incentives
(cont.)
Bonds - may be issued by state, local, or tribal govt's
for qualifying renewable energy projects (trickle down funds through AZ
state agencies?)
Clean Renewable Energy Bonds (CREBs)
Created under the Energy Policy Act of 2005.
ARRA authorizes additional $1.6 billion in new CREBs.
Qualified Energy Conservation Bonds (QECBs)
Created under Energy Improvement Act of 2008.
ARRA authorizes additional $2.4 billion in new QECBs to finance govt
greenhouse gas reduction programs (including allowing issuance
of loans and grants for "green
community programs").
Loan Guarantees
ARRA adds $500 million to DOE's Loan Guarantee Program established
by § 1705, Energy Policy Act of 2005.
For "(a)(3) Leading edge biofuel projects that will use technologies
performing at the pilot or demonstration scale that the Secretary determines
are likely to become commercial technologies and will produce transportation
fuels that substantially reduce life-cycle greenhouse gas emissions compared
to other transportation fuels."
Loan Guarantees
(cont.)
Projects must "commence construction not later than September 30,
2011."
Wages paid on qualifying projects cannot be less than "those prevailing
on similar work in the locality as determined by the" Davis-Bacon Act.
DOE may guarantee up to 100% of project's debt, capped at 80% of
project cost.
Loan Guarantees
(cont.)
Given time constraints of ARRA funding, DOE may not be able to create new
rules in time. Will probably rely on 2005 Energy Policy Act regulations.
As of March 1, 2009, DOE still hadn't issued a single loan guarantee
from 2005 EPA but Secretary Chu has promised to streamline the process
and begin offering guarantees by early May. (DOE Feb 19, 2009 Press Release.)
Grants
$3.2 Billion for the Energy Efficiency and Conservation Block Grant Program
Assists local govt's implementing energy efficiency and conservation
programs authorized by the Energy Independence and Security Act of
2007.
$2.8 billion awarded based on formula in Title V, subtitle E of the act (42 U.S.C.
17151 et seq.).
$400 million remaining awarded on a "competitive basis."
Arizona's portion is currently $63,817,400 (DOE website @ http://www.energy.gov/arizona.htm).
Grants
(cont.)
$3.1 Billion for the State Energy Program
Provides grants to state energy offices for efficiency and renewable programs
authorized under the Energy Policy and Conservation Act (42 U.S.C. 6321).
Conditioned on state Governors' assurances re regulatory policies,
building code requirements, prioritizing existing state programs.
Arizona's portion is currently $55,447,000 (DOE website @ http://www.energy.gov/arizona.htm).
Grants
(cont.)
$3.4 Billion for "Fossil Energy Research and Development."
Includes:
$1.52 billion for "industrial carbon capture and energy
efficiency improvement projects, including a small allocation for
innovative concepts for beneficial CO2 reuse." (Joint Explanatory
Statement of the Committee of Conference for the ARRA).
Grants
(cont.)
$1.6 Billion "for an additional amount for 'Science.'"
$1.2 Billion already allocated to DOE Office of Science (DOE March 23,
2009 Press Release
Approved projects include:
"$277 million for Energy Frontier Research Centers to be awarded
on a competitive basis to universities
" (including biofuels).
Grants
(cont.)
$400 Million for Advanced Research Projects Agency-Energy (ARPA-E)
To be used under § 5012 of the American Competes Act.
Grants
(cont.)
$500 Million for Green Jobs
Used for research, labor exchange, and job training projects to prepare
workers for energy efficiency and renewable industries.
To be used under § 171(e)(1)(B)(ii) of the Workforce Investment Act.
Up
to $37.5 million for Job Corps Centers which may include training in energy
efficiency careers.
Federal Grants Process
Registering Your Organization
6 Step Process
Step 1: Obtain DUNS Number
Step 2: Register with CCR
Step 3: Username and Password
Step 4: Register with Grants.gov
Step 5: AOR Authorization
Step 6: Track AOR Status
Step 1: Obtain Data Universal Number System
(DUNS) Number
Go to Dun and Bradstreet at http://fedgov.dnb.com/webform
Turn around = same day
Step 2: Register w/ Central
Contractor Registry (CCR)
Labor intensive requiring a lot of info
Apply by phone (1-888-227-2423) or on line (http://www.ccr.gov)
Designate E-Business Point of Contact (E-Biz POC) and create "M-PIN"
Turn around = 1-3 days for organization to gather needed info for application
+ at least 5 business days if organization has Employment identification Number
(EIN) or Taxpayer Identification Number (TIN). If no TIN or EIN then add additional
2 weeks to obtain info from IRS
IMPORTANT: CCR Needs to be Renewed Annually
Step 3: Username and Password
Wait one day after registration with CCR (Step 2) before creating username
and password
Username and password = electronic signature
To complete this step AOR registers with the Operational Research Consultants
(ORC) at http://apply07.grants.gov/apply/OrcRegister
Turnaround = same day (not including one day wait after Step 2)
Step 4: AOR Registers
with Grants.gov
AOR* registers at https://apply07.grants.gov/apply/GrantsgovRegister
Enter CCR username and password from Step 3
AOR registration triggers Step 5
Turn around = same day
*AOR (Authorized Organization Rep) is the person(s) authorized to submit
grant applications through Grants.gov on behalf of your organization
Step 5: AOR Authorization
E-Biz POC receives email notification that AOR has registered with Grants.gov
(Step 4)
Using DUNS number (Step 1) and MPIN (Step 2) E-Biz POC approves AOR to submit
grant applications on behalf of organization
Turnaround = same day
Step 6: Track AOR Status
AOR logs in to check status
Turnaround = depends on E-Biz POC in Step 5
Total time to complete registration process: 3 to 5 business
days or 1 to 3 weeks depending on your organization
ARRA Specific DOE Webpage
http://www.energy.gov/recovery/
Click on "Funding Opportunities" on left hand side.
The "American Recovery
and Reinvestment Act of 2009"
(ARRA)
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