Propane-powered cars could get tax credit

Propane-powered cars would be added to the list of alternative-fuel vehicles eligible for a special tax credit under a bill that won approval in a House committee Monday.

Freshman Rep. Paul Brown said adding propane to that list not only would help keep the air clean, but also promote sales of the gas at a time when Western Slope drilling companies need it the most.

“It’s a clean-burning fuel,” the Ignacio Republican said. “It is economical. If we have more propane use, it will decrease the demand for gasoline and diesel, and should help bring prices down for those fuels.”

Brown said that unlike natural gas, which as a fuel for vehicles is available at a limited number of pumps around the state, propane is readily available everywhere.

The House Agriculture, Livestock and Natural Resources Committee agreed, approving Brown’s bill on a 12–1 vote.

Others on the panel from both sides of the political aisle said propane should have been included in a 2009 law that created the tax credit in the first place. That credit is available over the next five years, but it steadily decreases over that time.

The credit it based on the amount motorists pay to have their vehicles converted to burn it, which can cost $4,000 to $12,000, depending on the vehicle.

This year, motorists who do the conversion can get 75 percent of that cost back through the credit, but that rate decreases to 55 percent next year, 35 percent in 2013 and 25 percent in 2014 and 2015.

Marshal Younglund, governmental affairs chairman for the Colorado Propane Gas Association, said the bill only corrects an oversight in the 2009 law that should have included propane as a vehicle fuel.

“Propane’s been around for a long time,” Younglund told the committee.

“Those of you who’ve been around a long time remember we used to have propane tractors, and some of them are still out there. Propane used to run most of the school buses for Denver public schools.”

The measure heads to the House Finance Committee, where it could face a tough time because of the $1 billion revenue shortfall. The measure, HB1281, would cost the state about $2.2 million in lost revenues over the next five years.


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