Public utility operating property

From the 2024 DOR Tax Exemption Study

82.08.0256; 82.12.0257 - Public utility operating property Description The sale of operating property used in conducting a utility operation to the state or a local government entity is exempt from sales and use taxes. The exemption includes properties such as water systems and electrical substations of a public utility. Exemption requirements include: - The utility property must be operating as utility property before the sale, and the new owner must continue to operate the property as a utility. - The purchaser of the operating utility property must be a state agency or political subdivision. Purpose This exemption addresses intergovernmental transfers of utility operations resulting from annexations or incorporations. These transfers do not result in financial gain but merely reflect a transfer of assets among jurisdictions. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes Indeterminate Indeterminate Indeterminate Indeterminate Local Taxes Indeterminate Indeterminate Indeterminate Indeterminate Repeal of Repealing this exemption would increase revenues. exemption Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repea