AB 302 — Relating to: a sales and use tax exemption for data center equipment or software. (FE)

- 2024 LEGISLATURE LRBs0085/1LRB-0422/1 JK&MPG:amn&cjsJK&MPG:wlj/amn/skw ASSEMBLY SUBSTITUTEBILL AMENDMENT302 June 1, TO2023 ASSEMBLY- BILLIntroduced 302by JuneRepresentatives 21,Z 2023IMMERMAN -, OfferedW ITTK, A LLEN, ARMSTRONG , BINSFELD, REEN , RUG , MURPHY, NEDWESKI, OCONNOR , PETRYK, PRONSCHINSKE and R ETTINGER, cosponsored by RepresentativIMMERMANSenators QUINN , BRADLEY, COWLES , EYEN , NASSand W ANGGAARD .

AReferred Nto ACommittee CTon toWays renumber and amendMeans. 238.08;

toA amendN 71.78A (4)CT (m)to create 77.54 (70) and 71.78238.40 (5);of the statutes;

and to create 77.54 (70), 238.08 (2) and 238.40 of the statutes;

a sales and use tax exemption for data center equipment andor materialssoftware. and information sharing between the Department of Revenue and the Wisconsin Economic Development Corporation.

Analysis by the Legislative Reference Bureau This bill creates a sales and use tax exemption for equipment or software used at a qualified data center, as certified by the Wisconsin Economic Development Corporation, for the processing, storage, retrieval, or communication of data.

Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

SECTIONS ECTION 1.

71.78 (4) (m) of the statutes is amended to read:

71.78 (4) (m) The chief executive officer of the Wisconsin Economic Development Corporation and employees of the corporation to the extent necessary to administer the development zone program tax benefit programs under subch.

II of ch.

238, including review of tax credit applications, compliance with tax credit certifications, and confirming the amount of tax credits used for purposes of revoking tax credits.

LRBs0085/1 - 2024 Legislature - 2 - JK&MPG:amn&cjs SECTION 2 SECTION 2.

71.78 (5) of the statutes is amended to read:

71.78 (5) GREEMENT WITH DEPARTMENT.

Copies of returns and claims specified in sub.

(1) and related schedules, exhibits, writings or audit reports shall not be furnished to the persons listed under sub.

(4), except persons under sub.

(4) (e), (k), (m), (n), (o) and (q) or under an agreement between the department of revenue and another agency of government.

SECTION 3.

77.54 (70) (a) The sales price from the sale of and the storage, use, or other consumption of tangibleequipment personalor property,software regardlessused ofat whethera thequalified propertydata iscenter affixedcertified to or incorporated into real property, and property under s.

77.52238.40 (1) (c), used exclusively for the development,processing, construction,storage, renovation,retrieval, expansion, replacement, repair, or operationcommunication of adata, qualifiedincluding datathe center,following: as defined in s.

238.40- (1)2024 (b),Legislature - 2 - LRB-0422/1 JK&MPG:wlj/amn/skw ASSEMBLY BILL 302 SECTION 1 (a) Servers, routers, connections, monitoring and security systems, and other enabling machinery, equipment, and hardware, including computerreplacements, serverupgrades, equipmentcomponent parts, and installations, regardless of whether the chassisproperty foris suchaffixed equipment;to or incorporated into real property.

networking(b) equipment;Equipment used in the operation of computer equipment or software or for the benefit of the qualified data center, including component parts, installations, replacements, and upgrades, regardless of whether the property is affixed to or incorporated into real property.

switches;(c) All equipment used for the transformation, distribution, or management of electricity that is used to operate computer server equipment, including substations, uninterruptible energy equipment, supplies, conduit, fuel piping and storage, cabling, duct banks, switches, switchboards, batteries, testing equipment, and backup generation equipment.

racks;(d) All equipment necessary to cool and maintain a controlled environment for the operation of computer servers and other components of the qualified data center, including chillers, mechanical equipment, refrigerant piping, fuel piping and storage, adiabatic and free cooling systems, cooling towers, water softeners, air handling units, indoor direct exchange units, fans, ducting, and filters.

fiber-optic(e) cabling,All copperwater cabling,conservation andsystems, otherincluding cabling,facilities includingor cablingmechanisms usedthat toare connectdesigned oneto orcollect, moreconserve, qualifiedand datareuse centers;water.

trays;(f) All computer server equipment, including the chassis, networking equipment, switches, racks, fiber-optic and copper cabling, trays, and conduit.

conduit;(g) All conduit, ducting, and fiber-optic and copper cabling that may be located outside the qualified data center, directly related to connecting one or more qualified data center locations.

substations;LRB-0422/1 - 2024 Legislature - 3 - JK&MPG:wlj/amn/skw SECTION 1 ASSEMBLY BILL 302 (h) All monitoring equipment and security systems.

uninterruptible(i) energyModular equipment;data centers and preassembled components of any item described in this subsection, including components used in the manufacturing of modular data centers.

supplies;(j) All software.

fuel(k) pipingOther tangible and storage;intangible personal property that is essential, as determined by the Wisconsin Economic Development Corporation, to the operations of the qualified data center, excluding property used in the administration of the qualified data center.

duct(L) banks;All electricity used at a qualified data center.

switches;S ECTION 2.

switchboards;

batteries;

testing equipment;

backup generation equipment;