Methane Gas Conversion Property Tax Exemption

Note: This exemption is only available to facilities operated in connection or conjunction with a publicly-owned sanitary landfill. The exemption was available to other entities only for systems placed in service by December 31, 2012. Systems in place before this date are eligible to receive the property tax exemption for 10 years.

Under Iowa's methane gas conversion property tax exemption, real and personal property used to decompose waste and convert the waste to gas, collect the methane or other gases, convert the gas to energy, or to collect waste for these purposes is exempt from property tax. This section was formerly written to only apply to facilities operated in connection with or in conjunction with a publicly-owned sanitary landfill. However, in 2009 the law was revised by S.F. 478 (retroactively effective to January 1, 2008) to apply to other technologies that use waste materials to generate methane (e.g., anaerobic digesters). This revision expired after December 31, 2012; for facilities that are not located at publicly-owned sanitary landfills, the exemption may only be claimed if the facility is placed in service between January 1, 2008 and December 31, 2012. Such projects may only claim the exemption for 10 years, a restriction that is not placed on facilities at a publicly-owned sanitary landfill. If other fuels in addition to methane are burned, the exemption is equal to the ratio of methane in the overall fuel mix. The claimant must file an application (Form 54-065) annually with the local assessor by February 1 of each year in order to claim the exemption.