The Internal Revenue Service Wednesday announced it is accepting applications from nonprofit electric cooperatives for $190.8 million of new clean renewable energy bonds that have not yet been allocated.
Electric coops generally were allocated $800 million of the $2.4 billion in new CREB authority under the American Recovery and Reinvestment Act, with the remaining $1.6 billion being split between governments and public power providers.
However, the IRS said Wednesday it received just 31 applications from electric coops requesting allocations totaling $609.2 million. As a result, it is taking a second round of requests to allocate the remaining amount. Any electric coops interested in applying have to submit an application by Nov. 1.
Interested parties must follow the same rules and requirements as were used in the original allocation process, and submit the same application, which is available on the IRS’ website, www.irs.gov. The agency is only considering applications from electric coops at this time.
The application requests the following information: the issuer; a project description; the owner of the facility; a demonstration that the project is a “qualified renewable energy facility;” an independent certification from an engineer that the project meets this definition and is technically viable and will produce the electricity; the project’s location; a financing plan; and the amount of CREBs requested.
Applicants also should mention if they have previously received CREB allocations for any related projects.
CREB allocations from the IRS are valid for three years, after which any unused authority will revert back to the agency and be reallocated to other projects.
New CREBs were originally authorized as tax-credit bonds, but they and three other tax-credit bond programs were allowed to be issued as direct-pay bonds, similar to Build America Bonds, under the Hiring Incentives to Restore Employment Act that was signed into law in March.
Issuers of direct-pay CREBs receive direct payments from the federal government roughly equal to 70% of interest costs.