This bill modifies Idaho's tax exemptions for data center operations, extending a sales tax exemption for data center equipment and revising property tax rules for capital investments. It requires businesses to invest at least $250 million in data center facilities and create 30 new full-time jobs within specific timeframes to qualify for the exemptions. The legislation also introduces new requirements for companies starting construction on or after April 1, 2026, including electricity rate agreements and water consumption planning with local providers. Businesses that fail to meet these investment and job creation requirements must pay the taxes that would have otherwise been owed.
This bill allocates $46.1 million to Idaho's Office of Species, Minerals, and Energy Coordination for fiscal year 2027 while simultaneously reducing funding and staffing for two related offices. It sets a maximum of 23 full-time positions for the main office, cuts 11 positions from the Office of Energy and Mineral Resources, and reduces 16 positions from the Office of Species Conservation. The legislation also lowers operating budgets for the energy and minerals office and the species conservation office, while maintaining or increasing funding for the main coordination office from various state and federal sources.
H 734 revises how Idaho allocates tax revenue from renewable energy producers (wind, solar, and geothermal). It requires these producers to file annual earnings statements with the State Tax Commission, which then calculates each county's share based on the proportion of the producer's property cost located within that county. The Commission further apportions the tax among local taxing units (like school districts) using a weighted formula based on property value and prior year tax rates. This bill directly affects renewable energy companies and local governments receiving tax funds, with retroactive application starting January 1, 2026.
H 676 amends Idaho water law to explicitly allow municipalities to secure rights for geothermal water used in heating and cooling systems. It requires municipal applicants to provide detailed documentation on where and how low-temperature geothermal water will be injected back into the ground after use. This update revises application rules and definitions to accommodate geothermal projects while ensuring environmental compliance. The bill passed the Idaho House of Representatives in February 2026 with strong bipartisan support.
