Montana Code Annotated 2023



Part 1. Classification

Class Eighteen Property -- Description -- Taxable Percentage

15-6-163. Class eighteen property -- description -- taxable percentage. (1) (a) Subject to subsection (1)(b), class eighteen property includes the land, improvements, furniture, fixtures, equipment, tools that are not exempt under 15-6-219, and supplies, except those included in class five property under 15-6-135 of a green hydrogen facility, green hydrogen pipeline, or green hydrogen storage system.

(b) Power generation primary fuel sources must be at least 25% by volume derived from green hydrogen to qualify under this section.

(2) During construction, property not meeting the definitions in subsection (6) must be classified as class eighteen property if, prior to March 1 of the first tax year for which the classification will be applied, the taxpayer certifies to the department that the facility under construction will meet the definitions in subsection (6) within 2 years of the date of the certification.

(3) The taxable property of a green hydrogen facility, a green hydrogen pipeline, and a green hydrogen storage system must be locally assessed.

(4) Class eighteen property does not include a green hydrogen facility, pipeline, or storage system for which, during construction, the standard prevailing wages for heavy construction, as provided in 18-2-401(13), were not paid during the construction phase.

(5) (a) Except as provided in subsections (5)(b) and (5)(c), class eighteen property is taxed at 3% of its market value.

(b) Class eighteen property defined in subsection (1) or meeting the requirements of subsection (2) is taxed at 1.5% of its market value for the first 15 years from the time construction commences.

(c) Class eighteen property defined in subsection (1) for which the owners have made an additional investment of $25 million or more is taxed at 1.5% of market value for the first 15 years from the time construction commences on the additional investment.

(6) As used in this section, the following definitions apply:

(a) "Green hydrogen" means hydrogen that is produced from nonfossil fuel feedstock sources and does not produce incremental greenhouse gas emissions during its production. The term does not include hydrogen produced using steam reforming or any other conversion technology that produces hydrogen from fossil fuel feedstock.

(b) "Green hydrogen facility" means the land, improvements, and personal property of a facility designed or modified:

(i) to produce green hydrogen through electrolysis technology;

(ii) to store or transport green hydrogen; or

(iii) to convert green hydrogen back to electricity through a hydrogen-capable power generation source with construction commencing after July 1, 2021.

(c) "Green hydrogen pipeline" means a pipeline used for the transport or storage of green hydrogen, with construction commencing after July 1, 2021.

(d) "Green hydrogen storage system" means the temporary storage of green hydrogen in a vessel, pipeline, or geologic formation.

History: En. Sec. 1, Ch. 291, L. 2021.