Iowa: Methane Gas Conversion Property Tax Exemption

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) in such a way that it now appears to apply to other technologies that use waste materials to generate methane (e.g., anaerobic digesters).

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. In addition, 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 1st of each year in order to claim the exemption.