S 3650 ISCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

2d SessionCommentsClose CommentsPermalink

S. 3650CommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to facilitate water leasing and water transfers to promote conservation and efficiency.CommentsClose CommentsPermalink

IN THE SENATE OF THE UNITED STATESCommentsClose CommentsPermalink

November 29, 2012CommentsClose CommentsPermalink

Mr. UDALL of Colorado (for himself, Mr. CRAPO, Mr. BENNET, and Mr. BARRASSO) introduced the following bill; which was read twice and referred to the Committee on FinanceCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to facilitate water leasing and water transfers to promote conservation and efficiency.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Ditch and Irrigation Company Tax Reform Act’.CommentsClose CommentsPermalink

SEC. 2. FACILITATE WATER LEASING AND WATER TRANSFERS TO PROMOTE CONSERVATION AND EFFICIENCY.

(a) In General- Paragraph (12) of section 501(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:CommentsClose CommentsPermalink





‘(I) TREATMENT OF MUTUAL DITCH OR IRRIGATION COMPANIES-CommentsClose CommentsPermalink





‘(i) IN GENERAL- In the case of a mutual ditch or irrigation company or like organization, subparagraph (A) shall be applied without taking into account any income received or accrued--CommentsClose CommentsPermalink





‘(I) from the sale, lease, or exchange of fee or other interests in real property, including interests in water,CommentsClose CommentsPermalink





‘(II) from the sale or exchange of stock in a mutual ditch or irrigation company or like organization or contract rights for the delivery or use of water, orCommentsClose CommentsPermalink





‘(III) from the investment of proceeds from sales, leases, or exchanges under subclauses (I) and (II),CommentsClose CommentsPermalink





except that any income received under subclause (I), (II), or (III) which is distributed or expended for expenses other than operations and maintenance of the mutual ditch or irrigation company or like organization shall be treated as non-member income in the year in which it is distributed or expended. For purposes of the preceding sentence, expenses other than operations and maintenance include expenses for the construction of conveyances designed to deliver water outside of the mutual ditch or irrigation company or like organization system.CommentsClose CommentsPermalink





‘(ii) TREATMENT OF ORGANIZATIONAL GOVERNANCE- In the case of a mutual ditch or irrigation company or like organization, where State law provides that such a company or organization may be organized in a manner that permits voting on a basis which is pro-rata to share ownership on corporate governance matters, subparagraph (A) shall be applied without taking into account whether its member shareholders have one vote on corporate governance matters per share held in the corporation. Nothing in this clause shall be construed to create any inference about the requirements of this subsection for companies or organizations not included in this clause.’.CommentsClose CommentsPermalink





(b) Effective Date- The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.CommentsClose CommentsPermalink