HB 514

Enrolled Copy  H.B. 514
1Utah Energy Council Amendments
                                       2026 GENERAL SESSION
                                             STATE OF UTAH
                                    Chief Sponsor: R. Neil Walter
                                      Senate Sponsor: Ann Millner
2
3  LONG TITLE
4  General Description:
5      This bill creates the Utah Energy Infrastructure Service District and modifies provisions
6  relating to the Utah Energy Council.
7  Highlighted Provisions:
8      This bill:
9      ▸ defines terms;
10      ▸ expands the Utah Energy Council (council) membership from five to seven members;
11      ▸ establishes a co-chair structure for council leadership;
12      ▸ designates the council as a state energy financing institution;
13      ▸ creates the Utah Energy Infrastructure Service District (district) as a political subdivision
14  of the state;
15      ▸ provides that council members serve concurrently as the board of trustees of the district;
16      ▸ authorizes the district to acquire, own, and operate energy infrastructure facilities within a
17  designated service area;
18      ▸ authorizes the district to issue revenue bonds payable solely from district revenues and
19  not subject to the state constitutional debt limitation;
20      ▸ requires the State Finance Review Commission to review and approve district revenue
21  bonds before issuance;
22      ▸ creates the Energy Infrastructure Enterprise Fund;
23      ▸ authorizes the district to enter into operating contracts with private operators for
24  district-owned facilities;
25      ▸ exempts district property from taxation and subjects operators to the privilege tax;
26      ▸ provides for dissolution of the district by the board or by an act of the Legislature; and
27      ▸ makes technical and conforming changes.
H.B. 514  Enrolled Copy
28   Money Appropriated in this Bill:
29None
30   Other Special Clauses:
31None
32   Utah Code Sections Affected:
33   AMENDS:
3479-6-1101, as enacted by Laws of Utah 2025, Chapter 120
3579-6-1102, as enacted by Laws of Utah 2025, Chapter 120
3679-6-1103, as enacted by Laws of Utah 2025, Chapter 375
3779-6-1104, as enacted by Laws of Utah 2025, Chapter 375
38   ENACTS:
3917B-2a-1401, Utah Code Annotated 1953
4017B-2a-1402, Utah Code Annotated 1953
4117B-2a-1403, Utah Code Annotated 1953
4217B-2a-1404, Utah Code Annotated 1953
4317B-2a-1405, Utah Code Annotated 1953
4417B-2a-1406, Utah Code Annotated 1953
4517B-2a-1407, Utah Code Annotated 1953
4617B-2a-1408, Utah Code Annotated 1953
4717B-2a-1409, Utah Code Annotated 1953
4817B-2a-1410, Utah Code Annotated 1953
4917B-2a-1411, Utah Code Annotated 1953
50
51   Be it enacted by the Legislature of the state of Utah:
52Section 1. Section 17B-2a-1401 is enacted to read:
53Part 14. Utah Energy Infrastructure Service District
5417B-2a-1401 . Definitions.
55   (1) "Board" means the board of trustees of the Utah Energy Infrastructure Service District.
56   (2) "Commission" means the State Finance Review Commission created in Section
5763C-25-201.
58   (3) "Council" means the Utah Energy Council created under Section 79-6-1101.
59   (4) "District" means the Utah Energy Infrastructure Service District created under Section
6017B-2a-1403.
61   (5) "Electrical Energy Development Investment Fund" means the fund created under
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62      Section 79-6-1105.
63  (6) "Electrical energy development zone" means the same as that term is defined in Section
64      79-6-102.
65  (7) "Energy infrastructure facility" means any real or personal property, including land,
66      structures, equipment, water rights, transmission lines, generation assets, storage
67      facilities, and associated improvements, used or useful for the generation, transmission,
68      storage, or delivery of energy, including electricity and natural gas.
69  (8) "Enterprise fund" means the Energy Infrastructure Enterprise Fund created under
70      Section 17B-2a-1408.
71  (9) "Operating contract" means a contract between the district and an operator for the
72      management, operation, and maintenance of an energy infrastructure facility owned by
73      the district.
74  (10) "Operator" means an entity that enters into an operating contract with the district.
75  (11) "Power purchase agreement" means a contract for the sale of electricity or other energy
76      produced by or transmitted through an energy infrastructure facility controlled or owned
77      by the district.
78  (12) "Project entity" means the same as that term is defined in Section 11-13-103.
79  (13) "Project entity asset" means the same as that term is defined in Section 11-13-318.
80  (14) "Retired project entity asset" means a project entity asset that has been removed from
81      active service before May 6, 2026, by a project entity that the project entity has no intent
82      to return to service.
83  (15) "Retired project entity asset area" means the land upon which a retired project entity
84      asset is located, together with adjacent land necessary for the operation of that asset.
85  (16) "Service area" means a geographic area designated by the board under Section
86      17B-2a-1405 within which the district owns or proposes to facilitate the acquisition or
87      construction of an energy infrastructure facility.
88Section 2. Section 17B-2a-1402 is enacted to read:
8917B-2a-1402 . Applicability and conflict.
90  (1) The district is governed by and has the powers stated in:
91      (a) this part; and
92      (b) Chapter 1, Provisions Applicable to All Special Districts, except as otherwise
93provided in this part.
94  (2) This part applies only to the district.
95  (3) The district is not subject to the provisions of any other part of this chapter.
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96   (4) If there is a conflict between a provision in Chapter 1, Provisions Applicable to All
97Special Districts, and a provision in this part, the provisions in this part govern.
98   (5) If there is a conflict between a provision of this part and a provision of Title 10, Utah
99Municipal Code, or Title 54, Public Utilities, Title 10, Utah Municipal Code, or Title 54,
100Public Utilities, as applicable, shall govern.
101Section 3. Section 17B-2a-1403 is enacted to read:
10217B-2a-1403 . Creation and status.
103   (1) The council may create the Utah Energy Infrastructure Service District by adopting a
104resolution that:
105(a) declares the council's intent to create the district;
106(b) describes the service area, including the geographic boundaries of the area within
107which the district will operate; and
108(c) identifies the type of energy infrastructure facility proposed or located within the
109service area.
110   (2) No later than 30 days after adopting a resolution under Subsection (1), the council shall
111file with the lieutenant governor:
112(a) a copy of a notice of an impending boundary action, as defined in Section 67-1a-6.5,
113that meets the requirements of Section 67-1a-6.5; and
114(b) a copy of an approved final local entity plat, as defined in Section 67-1a-6.5,
115depicting the service area boundary.
116   (3) The district is created and exists as a legal entity upon the lieutenant governor's issuance
117of a certificate of incorporation under Section 67-1a-6.5.
118   (4) Upon creation, the district:
119(a) is a body politic and corporate with perpetual succession;
120(b) is a political subdivision of the state;
121(c) is separate and distinct from the state and from any other political subdivision of the
122state; and
123(d) may sue and be sued.
124   (5) The debts, obligations, and liabilities of the district:
125(a) are the debts, obligations, and liabilities of the district alone; and
126(b) are not the debts, obligations, or liabilities of the state or any other political
127subdivision of the state.
128   (6) Notwithstanding Chapter 1, Part 2, Creation of a Special District, the district:
129(a) may only be created as provided in this section; and
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130      (b) is not subject to the petition and creation requirements of Sections 17B-1-203
131through 17B-1-214.
132  (7) Following the issuance of a certificate of incorporation under Subsection (3), the board
133      shall annually register the district with the lieutenant governor in accordance with
134      Section 67-1a-15.
135Section 4. Section 17B-2a-1404 is enacted to read:
13617B-2a-1404 . Board of trustees.
137  (1) Notwithstanding Chapter 1, Part 3, Board of Trustees, the board of trustees of the
138      district consists of the members of the council appointed under Section 79-6-1102.
139  (2)(a) A person serves as a member of the board by virtue of that person's appointment
140      to the council.
141      (b) Service on the board is concurrent with and coterminous with service on the council.
142  (3) The co-chairs of the council serve as co-chairs of the board.
143  (4) A vacancy on the board is filled in the same manner as a vacancy on the council under
144      Section 79-6-1102.
145  (5) The board shall adopt bylaws governing the conduct of board meetings, quorum
146      requirements, and other procedural matters consistent with this part and Chapter 1,
147      Provisions Applicable to All Special Districts.
148  (6)(a) When acting in the capacity of a board member, a council member's fiduciary
149      obligation runs to the district.
150      (b) Nothing in this section limits a council member's obligations to the council when
151acting in the capacity of a council member.
152Section 5. Section 17B-2a-1405 is enacted to read:
15317B-2a-1405 . Single service area authorized.
154  (1) The district's service area consists of:
155      (a) the service area established under Section 17B-2a-1403; and
156      (b) a retired project entity asset area.
157  (2) The district may own and operate energy infrastructure facilities only within a
158      designated service area.
159  (3) Once the service area is established, the district may not:
160      (a) annex any new land into the service area; or
161      (b) establish a new service area.
162Section 6. Section 17B-2a-1406 is enacted to read:
16317B-2a-1406 . Powers of the district.
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164   (1) Notwithstanding Subsection 17B-1-103(4) and Section 17B-1-202, and in addition to
165the powers conferred on a special district under Section 17B-1-103, the district may:
166(a) acquire by purchase, construction, gift, or any combination of these methods, and
167own, operate, maintain, improve, and dispose of energy infrastructure facilities
168within a designated service area;
169(b) enter into operating contracts with operators for the management, operation, and
170maintenance of district-owned energy infrastructure facilities in accordance with
171Section 17B-2a-1409;
172(c) enter into power purchase agreements for the sale of electricity or other energy
173produced by or transmitted through district-owned facilities;
174(d) issue revenue bonds in accordance with Section 17B-2a-1407 and Chapter 1, Part 11,
175Special District Bonds;
176(e) enter into contracts, agreements, and other instruments necessary or convenient to
177carry out the purposes of the district;
178(f) acquire water rights, air rights, and other real and personal property rights necessary
179or convenient to the ownership or operation of energy infrastructure facilities within
180the service area;
181(g) accept grants, gifts, loans, and other financial assistance from federal, state, and local
182governmental entities;
183(h) employ staff and engage financial advisors, engineers, and other professional
184services necessary to carry out the purposes of the district;
185(i) impose fees and charges for services provided by the district in accordance with
186Chapter 1, Part 9, Collection of Service Fees and Charges;
187(j) impose penalties on an operator for non-compliance with the terms of an operating
188contract, as specified in the operating contract; and
189(k) do all other things necessary or convenient to carry out the purposes of this part.
190   (2) Before constructing or operating an energy infrastructure facility within the boundaries
191of a city or town, the district shall obtain the consent of the local authorities who have
192control of any street or highway proposed to be occupied by the facility, in accordance
193with Utah Constitution, Article XI, Section 9.
194   (3)(a) The district is not an electric service provider and may not sell, distribute, or
195deliver electricity directly to retail customers.
196(b) Neither the district nor the board may provide electric service within the certificated
197service territory of any entity that has been authorized to provide retail electric
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198service in that territory pursuant to:
199(i) a certificate of public convenience and necessity issued by the Public Service
200Commission under Title 54, Public Utilities;
201(ii) a franchise, ordinance, or other authorization granted under Title 10, Utah
202Municipal Code; or
203(iii) any other provision of state law authorizing an entity to provide retail electric
204service within a defined geographic area.
205      (c) Nothing in this part shall be construed to limit, diminish, or otherwise affect the
206certificated service territory of an entity that has been authorized to provide retail
207electric service in the state.
208Section 7. Section 17B-2a-1407 is enacted to read:
20917B-2a-1407 . Revenue bonds -- Commission review and approval.
210  (1) The district may issue revenue bonds to finance the acquisition, construction,
211      improvement, or equipping of energy infrastructure facilities within a designated service
212      area.
213  (2)(a) Revenue bonds issued under this section:
214(i) are limited obligations of the district payable solely from revenues deposited into
215the enterprise fund described in Section 17B-2a-1408;
216(ii) do not constitute a general obligation or liability of, or a charge against the
217general credit or taxing power of, the state or any political subdivision of the state;
218(iii) are not subject to the debt limitations of Utah Constitution, Article XIV; and
219(iv) shall state on the face of each bond the limitation described in Subsection
220(2)(a)(ii).
221      (b) Notwithstanding the requirements in Subsection (2)(a)(iv), the failure to state on the
222face on the bond the limitation described in (2)(a)(ii) does not have any impact on the
223limited obligation described in this section.
224  (3)(a) The commission shall review and may approve a bond before the district may
225      issue a bond.
226      (b) The commission may not approve issuance of a bond described in Subsection (3)(a)
227unless the execution and terms of the bond comply with state law.
228      (c) If, after review, the commission approves a bond described in Subsection (3)(a), the
229district:
230(i) may not change before issuing the bond the terms of the bond that were reviewed
231by the commission if the change is outside the approved parameters and intended
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232purposes; and
233(ii) is under no obligation to issue the bond.
234(d) A member of the commission who approves a bond under Subsection (3)(a) is not
235personally liable on the bond.
236(e) The approval of a bond under Subsection (3)(a):
237(i) is not an obligation of the state; and
238(ii) is not an act that:
239(A) lends the state's credit; or
240(B) constitutes indebtedness within the meaning of any constitutional or statutory
241debt limitation.
242   (4) The district may pledge to the payment of revenue bonds any legally available revenues
243of the district.
244   (5) The district may establish reserve funds, debt service funds, and other funds as required
245by bond indentures or trust agreements securing revenue bonds issued under this section.
246   (6) The district may issue refunding bonds to refund outstanding revenue bonds issued
247under this section.
248   (7) Notwithstanding Chapter 1, Part 11, Special District Bonds, the district may not issue
249general obligation bonds.
250Section 8. Section 17B-2a-1408 is enacted to read:
25117B-2a-1408 . Energy Infrastructure Enterprise Fund.
252   (1) In addition to the requirements of Chapter 1, Part 6, Fiscal Procedures for Special
253Districts, the board shall establish and maintain an enterprise fund known as the Energy
254Infrastructure Enterprise Fund.
255   (2) The following shall be deposited into the enterprise fund:
256(a) proceeds of revenue bonds issued under Section 17B-2a-1407, pending application to
257authorized purposes including a bond project fund to ensure the appropriate use of
258such proceeds;
259(b) payments received by the district under operating contracts;
260(c) payments received by the district under power purchase agreements; and
261(d) any other revenues received by or pledged to the district.
262   (3) Revenues in the enterprise fund shall be used solely for the purposes of the district and
263applied in the order prescribed by the district and in compliance with any bond contract
264approved by the district.
265Section 9. Section 17B-2a-1409 is enacted to read:
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26617B-2a-1409 . Operating contracts.
267  (1) The district may enter into operating contracts with operators for the management,
268      operation, and maintenance of district-owned energy infrastructure facilities within the
269      service area described in Section 17B-2a-1405.
270  (2) An operating contract shall:
271      (a) require the operator to manage, operate, and maintain the facility in accordance with
272applicable law and prudent industry standards;
273      (b) specify the payments the operator shall make to the district, which shall be structured
274to cover, at minimum, the district's debt service obligations and operating costs
275attributable to the facility;
276      (c) specify the term of the contract, which may not exceed 40 years;
277      (d) provide that upon expiration or termination of the contract full operational control of
278the facility returns to the district free of any claim of the operator; and
279      (e) specify the conditions under which the contract may be terminated or renewed.
280  (3) An operating contract entered into under this section:
281      (a) is a service agreement; and
282      (b) does not convey a leasehold interest, ownership interest, or any other property
283interest in the facility to the operator.
284  (4) The district shall require each operator to maintain:
285      (a) adequate insurance coverage as determined by the board; and
286      (b) where appropriate, performance bonds or other financial security acceptable to the
287board to protect the district's interests under the operating contract.
288  (5) The board shall structure each operating contract to ensure that each operating contract
289      complies with applicable federal tax law governing qualified management contracts as
290      may be required by a federally tax-exempt revenue bond.
291Section 10. Section 17B-2a-1410 is enacted to read:
29217B-2a-1410 . Property taxes and privilege tax.
293  (1) All property and assets of the district are exempt from taxation as provided in Section
294      17B-1-116.
295  (2) An operator using district-owned facilities is subject to the privilege tax imposed under
296      Title 59, Chapter 4, Privilege Tax.
297  (3) The district may levy a privilege tax within the service area for district operations and
298      maintenance expenses at a rate not to exceed 0.0023.
299  (4) Notwithstanding this section, nothing prohibits the district from agreeing to a payment
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300in lieu of taxes in the board's sole discretion.
301Section 11. Section 17B-2a-1411 is enacted to read:
30217B-2a-1411 . Dissolution.
303   (1) The board may adopt a dissolution resolution if:
304(a) the district has ceased operations in the service area; and
305(b) the district has no outstanding debt or other obligations.
306   (2) The Legislature may dissolve the district by joint resolution.
307   (3) Upon dissolution of the district:
308(a) all outstanding revenue bonds shall be defeased or retired in accordance with their
309terms before dissolution is effective; and
310(b) all remaining assets of the district shall be transferred to the state.
311Section 12. Section 79-6-1101 is amended to read:
31279-6-1101 . Utah Energy Council -- Creation and purpose.
313   (1) As used in this part:
314(a) "Council" means the Utah Energy Council created in Section 79-6-1101.
315(b) "Decommissioned asset" means a project entity asset that:
316(i) has been removed from active service by a project entity;
317(ii) has been transferred to the council, including:
318(A) transfer of legal title; and
319(B) transfer of operational responsibility; and
320(iii) will be operated and managed under the direction of the council.
321(c) "District" means the Utah Energy Infrastructure Service District created under
322Section 17B-2a-1403.
323[(c)] (d) "Operator" means an entity that:
324(i) manages and maintains the daily operations of an electrical generation facility;
325(ii) employs the workforce necessary to run the facility;
326(iii) procures fuel and other necessary supplies;
327(iv) ensures compliance with all applicable regulations; and
328(v) maintains the reliability of power generation.
329[(d)] (e) "Project entity" means the same as that term is defined in Section 11-13-103.
330[(e)] (f) "Project entity asset" means the same as that term is defined in Section 11-13-318.
331(g) "State energy financing institution" means the same as that term is defined in 10
332C.F.R. 609.2.
333   (2) There is created within the office the Utah Energy Council.
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334  (3) The purpose of the council is to facilitate the development of electrical energy
335      generation and transmission projects within the state, including:
336      (a) power plants;
337      (b) transmission lines;
338      (c) energy storage facilities; and
339      (d) related infrastructure.
340  (4) The council is a state energy financing institution for purposes of accessing federal
341      programs available to state energy financing institutions, including programs under 10
342      C.F.R. Part 609.
343Section 13. Section 79-6-1102 is amended to read:
34479-6-1102 . Council composition -- Appointment -- Terms -- Staffing.
345  (1) The council shall be composed of:
346      (a) the director or the director's designee[, who shall serve as chair of the council];
347      (b) two individuals appointed by the governor;
348      (c) one individual appointed by the president of the Senate; [and]
349      (d) one individual appointed by the speaker of the House of Representatives[.] ;
350      (e) two individuals appointed by the members described in Subsections (1)(a) through (d),
351each of whom have experience in one or more of the following:
352(i) economic development, including support for existing or new industries that are
353critical to the state;
354(ii) public utilities, including utility operations, management, regulation, or policy;
355(iii) bonding or public financing, including municipal bond issuance, project finance,
356or public-private partnerships; or
357(iv) relevant legal matters, including energy law, public finance law, utility
358regulation, or securities law.
359  (2)(a) Except as provided in Subsection (2)(b), a council member appointed under
360      Subsection (1):
361(i) shall serve a four-year term;
362(ii) may be removed by the appointing authority;
363(iii) may be reappointed; and
364(iv) continues to serve until the member's successor is appointed and qualified.
365      (b) Initial terms for the appointed council members shall be staggered as follows:
366(i) one member appointed by the governor under Subsection (1)(b) shall serve a
367two-year term;
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368(ii) one member appointed by the governor under Subsection (1)(b) shall serve a
369three-year term;
370(iii) the member appointed by the president of the Senate under Subsection (1)(c)
371shall serve a four-year term; and
372(iv) the member appointed by the speaker of the House of Representatives under
373Subsection (1)(d) shall serve a two-year term.
374(c) A member appointed under Subsection (1)(e) may be removed by majority vote of
375the council members appointed under Subsections (1)(a) through (1)(d).
376   (3) When a vacancy occurs in the membership for any reason, the replacement shall be
377appointed by the relevant appointing authority for the unexpired term.
378   (4)(a) Until July 1, 2026, the director, or the director's designee, shall serve as chair of
379the council.
380(b) Beginning on July 1, 2026:
381(i) the director, or the director's designee, shall serve as a co-chair of the council; and
382(ii) the president of the Senate and the speaker of the House of Representatives shall
383jointly designate one member of the council described in Subsections (1)(b)
384through (1)(e) to serve as a co-chair of the council.
385(c) The co-chair designated under Subsection (4)(b)(ii) may be removed as co-chair and
386replaced by joint designation of the president of the Senate and the speaker of the
387House of Representatives.
388   [(4)] (5)(a) A majority of council members constitutes a quorum for conducting council
389business.
390(b) A majority vote of the quorum present is required for any action taken by the council.
391   [(5)] (6) The council shall meet:
392(a) at least quarterly; and
393(b) at the call of [the chair] a co-chair or a majority of the council members.
394   [(6)] (7)(a) A council member who is not a legislator may not receive compensation or
395benefits for the member's service but may receive per diem and travel expenses in
396accordance with:
397(i) Section 63A-3-106;
398(ii) Section 63A-3-107; and
399(iii) rules made by the Division of Finance under Sections 63A-3-106 and 63A-3-107.
400(b) Compensation and expenses of a council member who is a legislator are governed by
401Section 36-2-2 and Legislative Joint Rules, Title 5, Legislative Compensation and
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402Expenses.
403  [(7)] (8) The office shall provide staff support to the council.
404  (9)(a) Each member of the council serves concurrently as a member of the board of
405      trustees of the district by virtue of the member's appointment to the council.
406      (b) Service on the board is concurrent with and coterminous with service on the council
407and does not constitute a separate appointment or give rise to additional
408compensation.
409Section 14. Section 79-6-1103 is amended to read:
41079-6-1103 . Council powers and duties.
411  (1) The council shall:
412      (a) coordinate and facilitate electrical energy project development, including:
413(i) site identification and permitting;
414(ii) early site preparation work;
415(iii) infrastructure improvements;
416(iv) project financing assistance; and
417(v) stakeholder coordination;
418      (b) assess and facilitate electrical energy infrastructure development by:
419(i) evaluating infrastructure needs and opportunities;
420(ii) coordinating with transmission and pipeline developers;
421(iii) supporting utility planning efforts; and
422(iv) coordinating with federal agencies;
423      (c) establish and implement:
424(i) strategic plans for energy development;
425(ii) frameworks for stakeholder engagement;
426(iii) processes for designating electrical energy development zones; and
427(iv) criteria for evaluating proposed electrical energy development zones;
428      (d) review and approve:
429(i) research project proposals from the board; and
430(ii) funding allocations recommended by the board;
431      (e) consult with state land use authorities regarding:
432(i) identification of state lands suitable for electrical energy development;
433(ii) designation of electrical energy development zones; and
434(iii) opportunities for coordinated development of electrical energy projects on state
435lands;
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436      (f) administer the Electrical Energy Development Investment Fund created in Section
43779-6-1105;
438      (g) make recommendations regarding electrical energy policy to state and local
439governments;
440      (h) identify and recommend solutions to barriers affecting electrical energy development;
441      (i) assess and address potential public health impacts of electrical energy development
442zones;
443      (j) enter into contracts necessary to fulfill the council's duties;
444      (k) report annually by October 31 to the Public Utilities, Energy, and Technology
445Interim Committee and the Natural Resources, Agriculture, and Environment Interim
446Committee regarding:
447(i) the council's activities;
448(ii) energy development opportunities;
449(iii) infrastructure needs;
450(iv) the status of designated electrical energy development zones;
451(v) recommendations for how the property tax differential revenue collected under
452Section 79-6-1104 should be divided and distributed between the state, counties,
453and municipalities;
454(vi) investment decisions made by the council; and
455(vii) recommended policy changes;
456      (l) create and implement a strategic plan for a decommissioned asset, taking into
457consideration:
458(i) the state energy policy, as provided in Section 79-6-301;
459(ii) reliability of electrical generation; and
460(iii) economic viability;
461      (m) establish policies and procedures for the management of a decommissioned asset;
462      (n) administer contracts for the management and operations of a decommissioned asset;
463      (o) enter into contracts necessary for the operation and management of a
464decommissioned asset;
465      (p) acquire, hold, and dispose of property related to a decommissioned asset;
466      (q) select an operator for a decommissioned asset as provided in Section 79-6-1107; [and]
467      (r) report annually to the Legislative Management Committee regarding:
468(i) the status and progress of the asset transfer;
469(ii) operational and financial status of the asset under council control;
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470(iii) status of the operator contract;
471(iv) environmental compliance status; and
472(v) recommendations for legislation[.] ; and
473      (s) designate a service area for the district as provided in Section 17B-2a-1405.
474  (2) The council may create the Utah Energy Infrastructure Service District as provided in
475      Section 17B-2a-1403.
476  (3) The council shall negotiate with the applicable county or municipality regarding the
477      distribution of property tax differential revenue collected under Section 79-6-1104.
478  [(3)] (4) Any portion of the property tax differential that is not distributed to the council
479      shall be distributed to the applicable county or municipality for impact mitigation and
480      affordable housing.
481  [(4)] (5)(a) The portion of the property tax differential that is distributed to the
482      municipality shall be used for:
483(i) at least 10% of the total distribution shall be used for affordable housing
484programs; and
485(ii) the remaining portion shall be used to mitigate impacts within the municipality
486resulting from electrical energy development.
487      (b) The portion of the property tax differential that is distributed to the county shall be
488used for:
489(i) at least 10% of the total distribution shall be placed in a registered non-profit
490established to administer housing programs on behalf of an association
491representing 10 or more counties in the state; and
492(ii) the remaining portion shall be used to mitigate impacts within the county
493resulting from electrical energy development.
494  [(5)] (6) If the council acquires a project entity asset under Section 11-13-318, the council
495      shall enter into an agreement with the project entity that:
496      (a) provides for the transfer, disposition, and future operation of the asset; and
497      (b) ensures the transfer, disposition, and future operation does not interfere with the
498project entity's ownership or operation of electrical generation facilities powered by
499natural gas, hydrogen, or a combination of natural gas and hydrogen.
500Section 15. Section 79-6-1104 is amended to read:
50179-6-1104 . Electrical energy development zones -- Property tax differential.
502  (1) As used in this section:
503      (a) "Base taxable value" means the value of property within an electrical energy
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504development zone, as shown on the assessment roll last equalized before the creation
505of the electrical energy development zone.
506(b) "Community reinvestment agency" means the same as that term is defined in Section
50717C-1-102.
508(c) "Community reinvestment project area" means the same as that term is defined in
509Section 17C-1-102.
510(d) "Municipal power project" means an electrical energy project that:
511(i) is operated by or on behalf of a municipality; and
512(ii) exclusively serves customers within that municipality's jurisdictional boundaries.
513(e) "Property tax differential" means the difference between:
514(i) the amount of property tax revenues generated each tax year by all taxing entities
515from an electrical energy development zone, using the current assessed value of
516the property; and
517(ii) the amount of property tax revenues that would be generated from that same area
518using the base taxable value of the property.
519(f) "State land use authority" means:
520(i) the Utah Inland Port Authority created in Section 11-58-201;
521(ii) the Military Installation Development Authority created in Section 63H-1-201;
522(iii) the School and Institutional Trust Lands Administration created in Section
52353C-1-201; or
524(iv) any other land use authority created by the state that has jurisdiction over state
525lands.
526   (2)(a) Except as provided in Subsection (2)(b), a county or municipality may not offer
527financial incentives for a baseload electrical energy project that is not located within
528a designated electrical energy development zone.
529(b) Subsection (2)(a) does not apply to:
530(i) financial incentives offered for:
531(A) a municipal power project; or
532(B) an electrical energy project that exclusively utilizes intermittent resources; or
533(ii) an electrical energy project for which a project area plan has been approved
534before July 1, 2026.
535   (3) A county or municipality may:
536(a) pass a resolution declaring an intent to establish within the county or municipality
537boundaries an energy development zone;
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538      (b) enter into an interlocal agreement with the council outlining each parties'
539responsibilities relating to an energy development zone; and
540      (c) apply to the council for the designation of an electrical energy development zone by
541submitting:
542(i) a description of the proposed boundaries of the electrical energy development
543zone;
544(ii) an assessment of existing electrical energy infrastructure within and proximate to
545the proposed electrical energy development zone;
546(iii) a development plan that includes:
547(A) proposed electrical energy development projects;
548(B) anticipated infrastructure improvements;
549(C) projected economic benefits to the county; and
550(D) evidence of local support including any interlocal agreement entered into
551between the county or municipality and the council, as applicable;
552(iv) if the applicant is a municipality, evidence of coordination with the county in
553which the proposed electrical energy development zone is located, including any
554interlocal agreement entered into between the county or municipality and the
555council, as applicable;
556(v) if the applicant is a county and any portion of the proposed electrical energy
557development zone is within the boundaries of a municipality, evidence of an
558agreement with the municipality regarding the establishment of the electrical
559energy development zone; and
560(vi) any other information required by the council.
561  (4) A state land use authority may:
562      (a) propose an electrical energy development zone within lands under its jurisdiction; and
563      (b) apply to the council for the designation of an electrical energy development zone by
564submitting:
565(i) a description of the proposed boundaries of the electrical energy development
566zone;
567(ii) an assessment of existing electrical energy infrastructure within and proximate to
568the proposed electrical energy development zone;
569(iii) a development plan that includes:
570(A) proposed electrical energy development projects;
571(B) anticipated infrastructure improvements; and
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572(C) projected economic benefits;
573(iv) evidence that the proposed zone is consistent with applicable land use plans and
574regulations; and
575(v) any other information required by the council.
576   (5) The council shall:
577(a) approve an application for electrical energy development zone designation if the
578application demonstrates:
579(i) the proposed electrical energy development zone includes land suitable for
580electrical energy development based on:
581(A) access to electrical energy resources;
582(B) proximity to existing or planned transmission infrastructure;
583(C) adequate transportation access; and
584(D) sufficient land area for proposed development; and
585(ii) the development plan:
586(A) aligns with state energy policy under Section 79-6-301;
587(B) includes realistic timelines and milestones;
588(C) identifies specific infrastructure improvements; and
589(D) quantifies projected economic benefits;
590(b) make a determination on an application within 60 days of submission;
591(c) provide written notice to the county or municipality explaining the basis for approval
592or denial;
593(d) if an electrical energy development zone overlaps with an area designated by a
594community reinvestment agency as a community reinvestment project area as of May
5957, 2025, enter into an agreement with the community reinvestment agency to
596determine the percentage division of the property tax differential between:
597(i) the Electrical Energy Development Investment Fund; and
598(ii) the community reinvestment agency; and
599(e) if an electrical energy development zone overlaps with an inland port project, enter
600into an agreement with the Utah Inland Port Authority to determine the percentage
601division of the property tax differential between:
602(i) the Electrical Energy Development Investment Fund; and
603(ii) the Utah Inland Port Authority created in Section 11-58-201.
604   (6) Within 30 days after the council designates an electrical energy development zone:
605(a) the county auditor shall certify to the council the base taxable value of property
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606within the electrical energy development zone; and
607      (b) the county shall transmit to the council copies of the property tax assessment rolls for
608all property within the electrical energy development zone.
609  (7)(a) Each year, the county auditor shall:
610(i) determine the amount of the property tax differential for the electrical energy
611development zone by comparing:
612(A) the current assessed value of property within the electrical energy
613development zone; and
614(B) the base taxable value of property within the electrical energy development
615zone;
616(ii) inform the county treasurer of the property tax differential amount; and
617(iii) provide notice to the council of the amount calculated under this Subsection
618(7)(a).
619      (b) The county treasurer shall transfer the property tax differential to the council for
620deposit into the Electrical Energy Development Investment Fund created in Section
62179-6-1105, subject to any agreements entered into under Subsections (5)(d) and (5)(e).
622      (c) The county treasurer shall make distributions required under this section:
623(i) at the same time as regular annual property tax distributions; and
624(ii) using the same method as other property tax distributions.
625  (8) For property tax differential not subject to Subsection (5)(d) the council may enter into
626      agreements with taxing entities regarding the allocation of the property tax differential.
627  (9) If an electrical energy development zone designated under this section overlaps with an
628      existing or proposed service area of the district, the council shall note the overlap in the
629      zone designation resolution.
630Section 16. Effective Date.
631  This bill takes effect on May 6, 2026.
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