Data Center & Utility Modernization

Second Regular Session Seventy-fifth General Assembly STATE OF COLORADO INTRODUCED HOUSE BILL 26-1030 LLS NO. 26-0134.03 Rebecca Bayetti x4348 HOUSE SPONSORSHIP Valdez and Duran, SENATE SPONSORSHIP Mullica, House Committees Senate Committees Energy & Environment A BILL FOR AN ACT CONCERNING FACILITATION OF DATA CENTER DEVELOPMENT WHILE SUPPORTING UTILITY RESOURCES, AND, IN CONNECTION THEREWITH, CREATING THE WORKFORCE, CLEAN ENERGY, GRID MODERNIZATION, AND CONSUMER AND ENVIRONMENTAL PROTECTION ACT".

"COLORADO DATA CENTER Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.) The bill creates the data center development and incentive program (program) operated by the Colorado data center development authority Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.

Capital letters or bold & italic numbers indicate new material to be added to existing law. Dashes through the words or numbers indicate deletions from existing law.

(authority), which is newly created in the Colorado office of economic development (office) (section 1 of the bill). The authority consists of 9 members, as follows: ! 2 members appointed by the governor with the consent of the senate; ! The director of the Colorado energy office or the director's designee; ! One member who has experience in water projects or water resource management, appointed by the president of the senate; ! One member who has experience in clean and renewable energy, appointed by the speaker of the house of representatives; ! 2 members who have experience in data center development, with one member appointed by the speaker of the house of representatives and one member appointed by the president of the senate; ! One member representing a statewide organization that represents workers in trade crafts who construct data centers, appointed by the speaker of the house of representatives; and ! One member representing a statewide organization that represents contractors who construct data centers, appointed by the president of the senate. To incentivize efficient data center development, the program allows a 100% state sales and use tax exemption on qualified purchases to the operator of a certified data center. To be eligible for certification, the operator of the data center, or a data center operator collectively with participating data center tenants, must: ! Have initiated a preliminary consultation with the utility that will provide electricity for the data center project regarding interconnection feasibility, capacity, and infrastructure requirements; ! Commit to making a $250 million minimum investment in data center infrastructure within 5 years; ! Commit to creating new full-time jobs, including employees and long-term service and maintenance positions, that satisfy specified criteria and breaking ground on the data center project within 2 years of obtaining certification; ! Commit to complying, and ensure that the utility that provides electricity to the data center also complies, with craft labor requirements, apprenticeship utilization requirements, and prevailing wage requirements; and ! Commit to obtaining certification under one of several energy efficiency standards, implementing water stewardship strategies that optimize operational water management, ensuring that all backup power generation associated with the data center project meets specified requirements, and consulting with the department of natural resources. To obtain certification, a data center operator must apply to the authority in a form and manner to be determined by the authority. The authority is required to review a data center operator's application for certification and may award certification to a data center operator that has demonstrated that it will satisfy the certification criteria (section 1). A data center operator that obtains certification for a data center project is eligible for a 100% state sales and use tax exemption on the purchase and use of qualified data center infrastructure and systems for 20 years from the date that the data center project was certified, so long as the data center satisfies ongoing post-certification requirements and submits annual compliance reports to the authority. As long as the data center meets post-certification requirements as demonstrated in the annual compliance reports, a data center operator of a certified data center may apply to the authority for an extension of the sales and use tax exemption for an additional 10 years. If the authority determines that a data center operator is not fulfilling its obligations and commitments to retain certification, the authority may revoke the certification and the data center operator is required to repay the state for the sales and use tax benefits that it received (sections 1 and 5). The exemption for a certified data center does not apply to local sales and use taxes unless the exemption is expressly included at the time of adoption or amendment of the local sales tax ordinance or resolution (section 4). The bill allows a utility regulated by the public utilities commission (commission) to submit a targeted resource acquisition application to the commission to propose methods of meeting emerging large-load customer needs. The bill also specifies how a utility may finance resource and infrastructure needs in connection with emerging large-load customers (section 3).

Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, add part 8 to article 48.5 of title 24 as follows:

PART 8 DATA CENTER DEVELOPMENT AND INCENTIVES 24-48.5-801. Short title.

THE SHORT TITLE OF THIS PART 8 IS THE "COLORADO DATA CENTER WORKFORCE, CLEAN ENERGY, GRID MODERNIZATION, AND CONSUMER AND ENVIRONMENTAL PROTECTION ACT".

24-48.5-802. Legislative declaration.

(1) THE GENERAL ASSEMBLY FINDS, DETERMINES, AND DECLARES THAT:

(a) DATA CENTERS ARE ESSENTIAL CRITICAL INFRASTRUCTURE POWERING THE MODERN DIGITAL ECONOMY;

(b) DATA CENTERS WILL DRIVE COMMUNITY ACCESS TO SOLAR AND BATTERY STORAGE;

(c) COLORADO FACES INTERRELATED CHALLENGES IN:

(I) REDUCTION GOALS WHILE MAINTAINING GRID RELIABILITY;

(II) MODERNIZING GRID INFRASTRUCTURE FOR ELECTRIFICATION AND PROJECTED LOAD GROWTH;

ACHIEVING ITS CLEAN ENERGY AND GREENHOUSE GAS (III) ENSURING EQUITABLE DEVELOPMENT ACROSS URBAN, SUBURBAN, AND RURAL COMMUNITIES; AND

(IV) CREATING COMMUNITY BENEFITS THROUGH EXPANDING SOLAR AND BATTERY STORAGE PROGRAMS, ENSURING ALL COLORADANS HAVE ACCESS TO CLEAN ENERGY GENERATION AND STORAGE;

(d) THE COLORADO ELECTRIC TRANSMISSION AUTHORITY HAS IDENTIFIED TRANSMISSION NEEDS REQUIRING AN INVESTMENT OF APPROXIMATELY FOUR BILLION FIVE HUNDRED MILLION DOLLARS BY 2045 TO MODERNIZE, ENHANCE RELIABILITY, AND INTEGRATE CLEAN ENERGY;

AND

(e) DATA CENTERS REPRESENT A TRANSFORMATIVE OPPORTUNITY TO:

(I) INCLUDING:

(A) CYBERSECURITY, ADMINISTRATION;

HIGH-WAGE EMPLOYMENT ACROSS SECTORS, CREATE TECHNOLOGY FOCUSED N E T WO R K ROLES OPERATIONS, IN E NGINE E RING , AND SYSTEMS

(B) CONSTRUCTION AND SKILLED TRADES OPPORTUNITIES TO MEET THE FAST-GROWING DEMAND FOR DATA CENTER BUILDS; AND (C) ENERGY CAREERS IN GENERATION, TRANSMISSION, RENEWABLE ENERGY, AND GRID PROJECTS;

(II) ACCELERATE GRID MODERNIZATION THROUGH:

(A) STRATEGIC PRIVATE INVESTMENT IN TRANSMISSION AND DISTRIBUTION THAT BENEFITS ALL RATEPAYERS;

(B) THE DEVELOPMENT OF NEW GENERATION, BATTERY STORAGE, AND FLEXIBILITY TECHNOLOGY TO HELP BALANCE SUPPLY AND DEMAND;

(C) INCREASED HARDENING AGAINST EXTREME WEATHER, CYBER THREATS, AND DISRUPTIONS; AND (D) FINANCING MECHANISMS THAT SPEED INFRASTRUCTURE DEPLOYMENT;

(III) EMPHASIZE SOLAR ENERGY AND BATTERY STORAGE SOLUTIONS, WHICH BENEFIT THE COMMUNITY BY:

(A) ADDING DISPATCHABLE CAPACITY WITH STORAGE, WHICH IMPROVES PEAK FLEXIBILITY AND RELIABILITY;

(B) OFFERING FAST, LOW-COST, AND CLEAN ENERGY, WHICH IS CRITICAL TO MEET RISING ELECTRICITY DEMAND;

(C) BOOSTING RESILIENCY, PROVIDING BACKUP POWER, LOWERING PEAK ENERGY COSTS, AND INCREASING THE VALUE OF WIND AND SOLAR ENERGY TECHNOLOGY;

(D) REDUCING FUTURE TRANSMISSION COSTS AND REDUCING RELIANCE ON NEW GAS INFRASTRUCTURE; AND (E) REDUCING HOUSEHOLD ELECTRICITY BILLS BY APPROXIMATELY FIFTEEN PERCENT WITH COMBINED SOLAR AND BATTERY SYSTEMS;

(IV) ENCOURAGE A TRANSITION TO CLEAN AND RENEWABLE ENERGY THROUGH:

(A) ANCHORING NEW DISPATCHABLE RENEWABLE AND CLEAN ENERGY RESOURCES;

(B) ACCELERATING THE DEPLOYMENT OF ADVANCED CLEAN ENERGY TECHNOLOGY;

(C) FOLLOWING STRICT INTERNATIONAL BUILDING ENERGY EFFICIENCY STANDARDS;

(D) RELYING ON INNOVATIVE, CLEAN, NON-CARBON BACKUP POWER GENERATION SOURCES; AND (E) IMPLEMENTING STATE-OF-THE-ART, WATER-EFFICIENT, CLOSED-LOOP COOLING SYSTEMS; AND

(V) STRENGTHEN LOCAL AND COMMUNITY TAX BASES THROUGH:

(A) STABLE PROPERTY TAX FUNDING FOR SCHOOLS, LOCAL SERVICES, AND INFRASTRUCTURE;

(B) EXPENDITURES;

(C) EQUIPMENT; AND (D) SALES TAX FROM ELECTRICITY USE AND OPERATIONAL SUBSTANTIAL CAPITAL INVESTMENT IN PROPERTY AND ECONOMIC MULTIPLIERS FROM CONSTRUCTION, SUPPLY CHAINS, AND OPERATIONS.

(2) THE GENERAL ASSEMBLY FURTHER FINDS AND DECLARES THAT THE PURPOSE OF THE COLORADO DATA CENTER WORKFORCE, CLEAN ENERGY, GRID MODERNIZATION, AND CONSUMER AND ENVIRONMENTAL PROTECTION ACT IS TO:

(a) DRIVE THE EXPANSION OF COMMUNITY ACCESS TO SOLAR GENERATION AND BATTERY STORAGE STATEWIDE;

(b) IMPROVE COMPETITIVENESS WITH TAX INCENTIVES TO ATTRACT DATA CENTER INVESTMENT;

(c) ACCELERATE GRID MODERNIZATION AND INFRASTRUCTURE THROUGH PRIVATE CONTRIBUTIONS;

(d) CREATE HIGH-WAGE TECHNOLOGY AND CONSTRUCTION JOBS TO STRENGTHEN THE WORKFORCE;

(e) ENSURE RESPONSIBLE DEVELOPMENT WITH LOCAL EMPLOYMENT AND COMMUNITY BENEFITS;

(f) STRENGTHEN LOCAL ECONOMIES, ESPECIALLY IN RURAL COMMUNITIES AND COMMUNITIES IN TRANSITION;

(g) ADVANCE STATE POLICY GOALS WHILE MAINTAINING RESOURCE RELIABILITY AND PROTECTING RATEPAYERS; AND

(h) ENHANCE LEADERSHIP IN TECHNOLOGICAL INNOVATION, CLEAN AND RENEWABLE ENERGY, AND SUSTAINABLE GROWTH.

24-48.5-803. Definitions.

AS USED IN THIS PART 8, UNLESS THE CONTEXT OTHERWISE REQUIRES:

(1) "CERTIFICATION" MEANS RECOGNITION GRANTED TO A DATA CENTER BY THE AUTHORITY PURSUANT TO SECTION 24-48.5-807, UPON A DETERMINATION THAT THE DATA CENTER MEETS THE REQUIREMENTS SPECIFIED IN SECTION 24-48.5-806.

(2) "CERTIFIED DATA CENTER" MEANS A DATA CENTER THAT HAS RECEIVED CERTIFICATION.

(3) "COLORADO DATA CENTER DEVELOPMENT AUTHORITY" OR "AUTHORITY" MEANS THE COLORADO DATA CENTER DEVELOPMENT AUTHORITY CREATED IN SECTION 24-28.5-804.

(4) "COMMISSION" MEANS THE PUBLIC UTILITIES COMMISSION OF THE STATE OF COLORADO CREATED IN SECTION 40-2-101.

(5) "DATA CENTER" MEANS A FACILITY WITH ONE OR MORE BUILDINGS, INCLUDING CORRESPONDING ELECTRICAL INFRASTRUCTURE, THAT:

(a) HOUSES INFORMATION TECHNOLOGY EQUIPMENT USED FOR DATA PROCESSING, DATA STORAGE, OR TELECOMMUNICATIONS; AND

(b) HAS A PRIMARY FUNCTION OF DELIVERING INFORMATION TECHNOLOGY SERVICES, INCLUDING:

(I) PROVIDING DATA STORAGE, PROCESSING, AND TRANSPORT SERVICES;

(II) SUPPORTING THE DELIVERY OF CLOUD COMPUTING SERVICES;

(III) PROVIDING NETWORK CONNECTIVITY SERVICES; AND

(IV) SUPPORTING ARTIFICIAL INTELLIGENCE, MACHINE LEARNING, OR SIMILAR COMPUTATIONAL SERVICES.

(6) "DATA CENTER OPERATOR" MEANS A PERSON THAT OWNS OR OPERATES A DATA CENTER IN THE STATE.

(7) "DATA CENTER TENANT" MEANS A CLIENT OR COLOCATION TENANT OR LICENSEE OF A DATA CENTER, INCLUDING AN ENTITY THAT LEASES, RENTS, OR OTHERWISE ENTERS INTO A CONTRACTUAL AGREEMENT FOR THE USE OF DATA CENTER SPACE OR SERVICES, OR OTHERWISE COLOCATES INFORMATION TECHNOLOGY EQUIPMENT WITHIN A DATA CENTER.

(8) "DEPARTMENT" MEANS THE DEPARTMENT OF REVENUE.

(9) "OFFICE" MEANS THE OFFICE OF ECONOMIC DEVELOPMENT CREATED IN SECTION 24-48.5-101.

(10) "PROGRAM" MEANS THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CREATED IN THIS PART 8.

(11) "QUALIFIED PURCHASE" MEANS THE PURCHASE, ON OR AFTER JANUARY 1, 2027, OF:

(a) INFORMATION TECHNOLOGY INFRASTRUCTURE, INCLUDING:

(I) COMPUTER EQUIPMENT OR SOFTWARE USED IN THE OPERATION OF OR FOR THE BENEFIT OF A CERTIFIED DATA CENTER;

(II) SOFTWARE SERVERS, ROUTERS, CONNECTIONS, MONITORING AND SECURITY SYSTEMS, AND OTHER ENABLING MACHINERY, EQUIPMENT, SOFTWARE, AND HARDWARE, REGARDLESS OF WHETHER THE PROPERTY IS AFFIXED TO OR INCORPORATED INTO REAL PROPERTY;

(III) DATA STORAGE SYSTEMS; AND

(IV) NETWORK INFRASTRUCTURE; OR

(b) DATA CENTER INFRASTRUCTURE AND TRANSMISSION AND GENERATION SYSTEM ASSETS, INCLUDING:

(I) ENVIRONMENTAL CONTROL SYSTEMS;

(II) ON-SITE ENERGY STORAGE SYSTEMS; AND

(III) ON-SITE RENEWABLE AND CLEAN ENERGY SYSTEMS.

(12) "RENEWABLE AND CLEAN ENERGY" MEANS ELECTRICITY GENERATED FROM:

(a) SOURCES MEETING THE DEFINITION OF CLEAN ENERGY, AS DEFINED IN SECTION 30-20-1202 (2); OR (b) SOURCES QUALIFYING AS ELIGIBLE ENERGY RESOURCES PURSUANT TO SECTION 40-2-124.

24-48.5-804. Colorado data center development authority - office of economic development - creation - membership - powers and duties - report.

(1) THE COLORADO DATA CENTER DEVELOPMENT AUTHORITY IS CREATED IN THE OFFICE.

(2) (a) THE AUTHORITY CONSISTS OF NINE MEMBERS AS FOLLOWS:

(I) TWO MEMBERS APPOINTED BY THE GOVERNOR WITH THE CONSENT OF THE SENATE;

(II) THE DIRECTOR OF THE COLORADO ENERGY OFFICE CREATED IN SECTION 24-38.5-101 OR THE DIRECTOR'S DESIGNEE;

(III) ONE MEMBER WHO HAS EXPERIENCE IN WATER PROJECTS OR WATER RESOURCE MANAGEMENT, APPOINTED BY THE PRESIDENT OF THE SENATE;

(IV) ONE MEMBER WHO HAS EXPERIENCE IN CLEAN AND RENEWABLE ENERGY, APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES;

(V) TWO MEMBERS WHO HAVE EXPERIENCE IN DATA CENTER DEVELOPMENT, WITH ONE MEMBER APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES AND ONE MEMBER APPOINTED BY THE PRESIDENT OF THE SENATE;

(VI) ONE MEMBER REPRESENTING A STATEWIDE ORGANIZATION THAT REPRESENTS WORKERS IN TRADE CRAFTS WHO CONSTRUCT DATA CENTERS , REPRESENTATIVES; AND APPOINTED BY THE SPEAKER OF THE HOUSE OF

(VII) ONE MEMBER REPRESENTING A STATEWIDE ORGANIZATION THAT REPRESENTS CONTRACTORS WHO CONSTRUCT DATA CENTERS, APPOINTED BY THE PRESIDENT OF THE SENATE.

(b) (I) EXCEPT AS PROVIDED IN SUBSECTION (2)(b)(II) OF THIS SECTION FOR THE INITIAL TERMS OF THE INITIALLY APPOINTED MEMBERS, ALL APPOINTED MEMBERS OF THE AUTHORITY SERVE FOUR-YEAR TERMS.

MEMBERS OF THE AUTHORITY ARE ELIGIBLE FOR REAPPOINTMENT FOR CONSECUTIVE TERMS.

(II) (A) ONE OF THE MEMBERS INITIALLY APPOINTED BY THE GOVERNOR AND TWO OF THE MEMBERS INITIALLY APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES SERVE INITIAL TERMS OF THREE YEARS. ONE OF THE MEMBERS INITIALLY APPOINTED BY THE GOVERNOR AND TWO OF THE MEMBERS INITIALLY APPOINTED BY THE PRESIDENT OF THE SENATE SERVE INITIAL TERMS OF TWO YEARS. THE REMAINDER OF THE INITIALLY APPOINTED MEMBERS SERVE INITIAL TERMS OF FOUR YEARS. THE APPOINTING AUTHORITY SHALL DESIGNATE THE INITIAL TERM LENGTH OF THE INITIALLY APPOINTED MEMBER.

(B) THE APPOINTING AUTHORITIES SHALL MAKE THEIR INITIAL APPOINTMENTS AS SOON AS PRACTICABLE FOLLOWING THE EFFECTIVE DATE OF THIS SECTION. APPOINTMENTS MADE WHILE THE SENATE IS NOT IN SESSION ARE TEMPORARY APPOINTMENTS AND SUCH APPOINTEES SERVE ON A TEMPORARY BASIS UNTIL THE SENATE IS IN SESSION AND IS ABLE TO CONFIRM THE APPOINTMENTS.

(III) A VACANCY IN THE MEMBERSHIP OF THE AUTHORITY MUST BE FILLED IN THE SAME MANNER AS THE ORIGINAL APPOINTMENT FOR THE REMAINDER OF THE EXPIRED TERM.

(c) THE AUTHORITY SHALL SELECT A CHAIR AND A VICE CHAIR FROM AMONG ITS MEMBERS.

(d) A TWO-THIRDS MAJORITY OF THE MEMBERS OF THE AUTHORITY MAY REMOVE A MEMBER OF THE AUTHORITY FOR CAUSE.

(e) FIVE MEMBERS OF THE AUTHORITY CONSTITUTE A QUORUM.

(f) MEMBERS OF THE AUTHORITY SERVE WITHOUT COMPENSATION BUT ARE ENTITLED TO REIMBURSEMENT FOR ACTUAL AND NECESSARY EXPENSES INCURRED IN THE PERFORMANCE OF THEIR DUTIES.

(3) THE AUTHORITY HAS THE FOLLOWING POWERS AND DUTIES:

(a) TO ADMINISTER THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CREATED IN THIS PART 8, INCLUDING CREATING AND MODIFYING POLICIES, PROCEDURES, AND GUIDELINES AS NECESSARY TO IMPLEMENT THE PROGRAM AND THE TAX BENEFITS THAT MAY BE CLAIMED PURSUANT TO THIS PART 8. THE AUTHORITY MAY MODIFY THE PROGRAM REQUIREMENTS AS NECESSARY TO ACCOMPLISH THE PROGRAM'S GOALS, PROVIDED THAT ALL PROGRAM REQUIREMENT MODIFICATIONS ARE PROSPECTIVE APPLICATION FOR CERTIFICATION.

AND NO MODIFICATION IMPAIRS AN IN-PROGRESS

(b) TO ADOPT AN ANNUAL BUDGET;

(c) TO CONTRACT FOR THOSE SERVICES, INCLUDING PERSONNEL SERVICES, AND MATERIALS REQUIRED BY THE ACTIVITIES OF THE AUTHORITY;

(d) TO COLLECT THE FEES AUTHORIZED IN SECTION 24-48.5-805 (3);

(e) TO ADMINISTER THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND CREATED IN SECTION 24-48.5-805 (4);

AND

(f) TO EXERCISE ANY OTHER POWERS OR PERFORM ANY OTHER DUTIES THAT ARE CONSISTENT WITH THE PURPOSES FOR WHICH THE AUTHORITY WAS CREATED AND THAT ARE REASONABLY NECESSARY FOR THE FULFILLMENT OF THE AUTHORITY'S RESPONSIBILITIES.

(4) (a) ON OR BEFORE JANUARY 31, 2027, AND ON OR BEFORE EACH JANUARY 31 THEREAFTER, THE AUTHORITY SHALL REPORT ON THE PROGRAM TO A JOINT SESSION OF THE HOUSE OF REPRESENTATIVES ENERGY TRANSPORTATION AND ENERGY COMMITTEE, OR THEIR SUCCESSOR COMMITTEES. THE AUTHORITY SHALL MAKE EACH ANNUAL REPORT PUBLICLY AVAILABLE.

AND ENVIRONMENT COMMITTEE AND THE SENATE

(b) NOTWITHSTANDING THE REQUIREMENT IN SECTION 24-1-136 (11)(a)(I), THE REQUIREMENT TO SUBMIT THE REPORT REQUIRED IN THIS SUBSECTION (4) CONTINUES INDEFINITELY.

(5) THE OFFICE SHALL, WITHIN EXISTING RESOURCES, PROVIDE STAFFING, ADMINISTRATIVE, AND OPERATIONAL SUPPORT TO THE AUTHORITY IN PERFORMING ITS DUTIES.

24-48.5-805. Data center development and incentive program - data center development and incentive program cash fund - fees - guidelines.

(1) THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM IS CREATED TO FACILITATE EFFICIENT DATA CENTER DEVELOPMENT BY ALLOWING TAX RELIEF TO A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER, AS PROVIDED IN THIS PART 8.

(2) (a) THE AUTHORITY SHALL ADMINISTER THE PROGRAM.

(b) THE AUTHORITY MAY CREATE AND MODIFY POLICIES, PROCEDURES, AND GUIDELINES AS NECESSARY TO IMPLEMENT THE PROGRAM AND TAX BENEFITS THAT MAY BE CLAIMED PURSUANT TO THIS PART 8.

(3) (a) (I) TO RECOVER THE DIRECT COSTS OF ESTABLISHING AND IMPLEMENTING THE PROGRAM, THE AUTHORITY MAY:

(A) ESTABLISH AND COLLECT A NONREFUNDABLE APPLICATION FEE NOT TO EXCEED THIRTY THOUSAND DOLLARS FOR EACH APPLICATION FOR CERTIFICATION SUBMITTED PURSUANT TO THIS PART 8; AND

(B) ESTABLISH AND COLLECT A NONREFUNDABLE CERTIFICATION FEE NOT TO EXCEED TWENTY THOUSAND DOLLARS FOR EACH CERTIFICATION AWARDED PURSUANT TO THIS PART 8.

(II) THE AUTHORITY SHALL DEPOSIT ALL FEES COLLECTED PURSUANT TO SUBSECTION (3)(a)(I) OF THIS SECTION INTO THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND CREATED IN SUBSECTION (4) OF THIS SECTION.

(b) THE AUTHORITY SHALL:

(I) SET THE AMOUNT OF ANY FEES ESTABLISHED PURSUANT TO THIS SUBSECTION (3) AT THE MINIMUM AMOUNT NECESSARY TO OFFSET THE AUTHORITY'S DIRECT COSTS OF IMPLEMENTING ITS RESPONSIBILITIES UNDER THIS PART 8; AND

(II) ANNUALLY REVIEW THE FEES AND ADJUST THE AMOUNTS AS NECESSARY TO ENSURE THAT THE FEES DO NOT EXCEED THE DIRECT COSTS OF IMPLEMENTING THIS PART 8.

(4) (a) THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND IS CREATED IN THE STATE TREASURY. THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND CONSISTS OF MONEY FROM FEES COLLECTED AND CREDITED TO THE FUND PURSUANT THIS SECTION AND ANY OTHER MONEY THAT THE GENERAL ASSEMBLY MAY APPROPRIATE, TRANSFER, OR REQUIRE BY LAW TO BE CREDITED TO THE FUND.

(b) THE STATE TREASURER SHALL CREDIT ALL INTEREST AND INCOME DERIVED FROM THE DEPOSIT AND INVESTMENT OF MONEY IN THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND TO THE FUND.

(c) MONEY IN THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND IS CONTINUOUSLY APPROPRIATED TO THE AUTHORITY FOR THE PURPOSE OF ADMINISTERING THE PROGRAM.

(d) THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND IS EXCLUDED FROM THE LIMITATIONS SPECIFIED IN SECTION 24-48.5-806. Certification - application process - data center operators - minimum commitments.

(1) Minimum certification commitments. TO QUALIFY FOR CERTIFICATION PURSUANT TO THIS PART 8, A DATA CENTER OPERATOR, OR A DATA CENTER OPERATOR COLLECTIVELY WITH ITS PARTICIPATING DATA CENTER TENANTS, SHALL COMMIT TO:

(a) MAKING A MINIMUM INVESTMENT OF TWO HUNDRED FIFTY MILLION DOLLARS IN DATA CENTER QUALIFIED PURCHASES WITHIN SIXTY MONTHS OF OBTAINING CERTIFICATION;

(b) CREATING, WITHIN SIXTY MONTHS OF THE DATA CENTER'S RECEIPT OF A FINAL CERTIFICATE OF OCCUPANCY, AND MAINTAINING NEW FULL-TIME EQUIVALENT JOBS, INCLUDING EMPLOYEES AND LONG-TERM SERVICE COMPENSATION OF AT LEAST ONE HUNDRED TEN PERCENT OF THE AVERAGE WAGE IN THE COUNTY IN WHICH THE DATA CENTER WILL BE LOCATED;

AND MAINTENANCE POSITIONS , WITH AN AVERAGE

(c) HIRING CONTRACTORS TO BUILD AND SERVICE THE DATA CENTER;

(d) WORKING TO ENSURE THAT THE DATA CENTER WILL NOT CAUSE UNREASONABLE COST IMPACTS TO OTHER UTILITY RATEPAYERS;

(e) O PT IMIZ E IMPLEMENTATION OF CLOSED-LOOP COOLING SYSTEMS OR COOLING SYSTEM TECHNOLOGY THAT DOES NOT USE WATER, AND THE OPTIONAL DEPLOYMENT OF ADDITIONAL WATER-EFFICIENT TECHNOLOGY;

IMPLEMENTING WATER STEWARDSHIP MEASURES THAT O P E R A T IO N A L WA T E R MANAGEMENT THROUGH

(f) OBTAINING CERTIFICATION UNDER ONE OF THE FOLLOWING STANDARDS WITHIN TWENTY-FOUR MONTHS OF THE DATA CENTER'S RECEIPT OF A FINAL CERTIFICATE OF OCCUPANCY:

(I) LEED FOR DATA CENTERS AT GOLD LEVEL OR HIGHER;

(II) ENERGY STAR CERTIFICATION;

(III) GREEN GLOBES CERTIFICATION;

(IV) ISO 50001 ENERGY MANAGEMENT CERTIFICATION;

(V) ISO 14001 STANDARD FOR ENVIRONMENTAL MANAGEMENT SYSTEMS; OR (VI) AUTHORITY;

OTHER EQUIVALENT STANDARDS APPROVED BY THE

(g) CONSULTING WITH THE DEPARTMENT OF NATURAL RESOURCES REGARDING WILDLIFE AREAS, WILDFIRE AND URBAN INTERFACE, AND WATER;

(h) ENSURING THAT ALL BACKUP POWER GENERATION ASSOCIATED WITH THE DATA CENTER MEETS ONE OR MORE OF THE REQUIREMENTS LISTED IN SUBSECTIONS (1)(h)(I) TO (1)(h)(IV) OF THIS SECTION; EXCEPT THAT THE AUTHORITY MAY GRANT ADDITIONAL TIME FOR COMPLIANCE WITH THIS SUBSECTION (1)(h) IF A DATA CENTER OPERATOR DEMONSTRATES REASONABLE EFFORTS TO COMPLY BUT REQUIRES ADDITIONAL TIME DUE TO EQUIPMENT AVAILABILITY OR SUPPLY CHAIN CONSTRAINTS DUE TO FACTORS OUTSIDE THE CONTROL OF THE DATA CENTER OPERATOR.

(I) FOR DIESEL GENERATORS, THE GENERATOR MUST:

(A) MEET OR EXCEED THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY'S TIER 4 FINAL EMISSIONS STANDARDS; OR

(B) MEET OR EXCEED THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY'S TIER 2 EMISSIONS STANDARDS AND BE EQUIPPED WITH A SELECTIVE CATALYTIC REDUCTION SYSTEM OR EQUIVALENT AFTER-TREATMENT TECHNOLOGY.

(II) THE BACKUP POWER GENERATION MUST BE A BATTERY ELECTRIC STORAGE SYSTEM.

(III) THE BACKUP POWER GENERATION MUST BE FROM ONE OR MORE OF THE FOLLOWING SOURCES:

(A) HYDROTREATED VEGETABLE OIL, ETHICAL BIOFUEL OIL, OR ONE HUNDRED PERCENT BIODIESEL;

(B) FUEL-CELL OR HYDROGEN FUEL;

(C) NATURAL GAS; OR

(D) AMMONIA.

(IV) THE BACKUP POWER GENERATION MUST BE FROM OTHER CLEAN OR LOW-EMISSION BACKUP POWER TECHNOLOGIES APPROVED BY THE AUTHORITY.

(i) BREAKING GROUND ON THE DATA CENTER WITHIN TWENTY-FOUR MONTHS OF OBTAINING CERTIFICATION;

(j) COMPLYING WITH, AND ENSURING THAT THE UTILITY THAT WILL PROVIDE ELECTRICITY TO THE DATA CENTER COMPLIES WITH, FOR THE ENTIRETY OF THE CONSTRUCTION PHASE OF THE DATA CENTER AND FOR ANY SUBSEQUENT SERVICE AND MAINTENANCE WORK, THE CRAFT LABOR REQUIREMENTS IN PART 3 OF ARTICLE 92 OF THIS TITLE 24 AND THE APPRENTICESHIP UTILIZATION REQUIREMENTS IN SECTION 24-92-115 (7), IF THE PROJECT FOR THE DATA CENTER, THE ELECTRIC UTILITY INFRASTRUCTURE ATTACHED TO THE DATA CENTER, OR THE ELECTRICAL POWER GENERATION TECHNOLOGY ATTACHED TO THE DATA CENTER MEETS THE DEFINITION OF AN ENERGY SECTOR PUBLIC WORKS PROJECT AS DEFINED IN SECTION 24-92-303 (5);

(k) COMPLYING WITH THE PREVAILING WAGE REQUIREMENTS IN PART 2 OF ARTICLE 92 OF THIS TITLE 24, AS IF THE PROJECT FOR THE DATA CENTER SATISFIED THE CRITERIA FOR A PUBLIC PROJECT AS DESCRIBED IN

SECTION 24-92-203 (1);

(l) AGREEING TO FILE, AND ENSURING THAT ALL CONTRACTORS ASSOCIATED WITH CONSTRUCTION OF THE DATA CENTER FILE AS PART OF THE BID PROCESS, WORKER SAFETY PLANS THAT INCLUDE PROVISIONS FOR COMPLIANCE WITH ALL FEDERAL OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION STANDARDS AND APPLICABLE STATE AND FEDERAL WORKPLACE SAFETY LAWS; AND

(m) COMMITTING TO SATISFYING THE POST-CERTIFICATION DATA CENTER REQUIREMENTS SPECIFIED IN SECTION 24-48.5-809.

(2) Preliminary electric utility consultation.

(a) BEFORE SUBMITTING AN APPLICATION FOR CERTIFICATION, A DATA CENTER OPERATOR SHALL INITIATE A PRELIMINARY CONSULTATION WITH THE UTILITY THAT WILL PROVIDE ELECTRICITY FOR THE DATA CENTER REGARDING INTERCONNECTION FEASIBILITY, CAPACITY, AND INFRASTRUCTURE REQUIREMENTS.

(b) A DATA CENTER OPERATOR IS RESPONSIBLE FOR PAYING ALL COSTS THAT AN ELECTRIC UTILITY WILL INCUR FOR THE PLANNING TO PROVIDE ELECTRICITY TO A NEW DATA CENTER.

(3) Application for certification. A DATA CENTER OPERATOR SEEKING CERTIFICATION MUST SUBMIT AN APPLICATION TO THE AUTHORITY, IN A FORM AND MANNER DETERMINED BY THE AUTHORITY, THAT INCLUDES THE FOLLOWING:

(a) INFORMATION ABOUT THE DATA CENTER FOR WHICH THE DATA CENTER OPERATOR IS SEEKING CERTIFICATION, INCLUDING:

(I) THE IDENTITY AND QUALIFICATIONS OF THE DATA CENTER OPERATOR;

(II) EVIDENCE OF SITE CONTROL OR A PATHWAY TO SITE CONTROL;

(III) A PROPOSED DEVELOPMENT TIMELINE AND PHASING;

(IV) AN ESTIMATED TIMELINE FOR QUALIFIED PURCHASES REACHING A MINIMUM OF TWO HUNDRED FIFTY MILLION DOLLARS WITHIN THIRTY-SIX MONTHS OF THE DATA CENTER BEING PLACED IN SERVICE OR RECEIPT OF A FINAL CERTIFICATE OF OCCUPANCY, WHICHEVER IS EARLIER;

(V) AN ESTIMATED JOB CREATION PLAN BY THE DATA CENTER OPERATOR, OR BY THE DATA CENTER OPERATOR COLLECTIVELY WITH ITS PARTICIPATING DATA CENTER TENANTS, SHOWING THE ANTICIPATED NUMBER OF NEW FULL-TIME EQUIVALENT JOBS THAT WILL BE CREATED WITHIN SIXTY MONTHS AFTER THE DATA CENTER'S RECEIPT OF A FINAL CERTIFICATE OF OCCUPANCY, INCLUDING EMPLOYEES AND LONG-TERM SERVICE AND MAINTENANCE POSITIONS, WITH COMPENSATION OF AT LEAST ONE HUNDRED TEN PERCENT OF THE AVERAGE WAGE FOR THE COUNTY IN WHICH THE DATA CENTER WILL BE LOCATED; AND

(VI) AN ENVIRONMENTAL SUSTAINABILITY PLAN FOR THE DATA CENTER THAT INCLUDES:

(A) A FACILITY CERTIFICATION COMMITMENT, INCLUDING LEED, ENERGY STAR, GREEN GLOBES, ISO 50001, ISO 14001, OR AN EQUIVALENT STANDARD; AND

(B) CONSULTATION WITH DEPARTMENT OF NATURAL RESOURCES;

(b) THE IDENTITY OF THE UTILITY THAT WILL PROVIDE ELECTRICITY FOR THE DATA CENTER AND EXPECTED PEAK ELECTRICITY DEMAND FOR THE DATA CENTER;

(c) DOCUMENTATION OF THE PRELIMINARY CONSULTATION WITH THE UTILITY THAT WILL PROVIDE ELECTRICITY TO THE DATA CENTER AS REQUIRED BY SUBSECTION (2)(a) OF THIS SECTION;

(d) INFORMATION ABOUT WHETHER THE DATA CENTER WILL USE WATER AS PART OF ITS COOLING SYSTEM AND, IF WATER WILL BE USED, THE IDENTITY OF THE UTILITY THAT WILL PROVIDE WATER FOR THE DATA CENTER; AND

(e) LOCAL GOVERNMENT DOCUMENTATION IN CONNECTION WITH THE DATA CENTER, INCLUDING:

(I) DOCUMENTATION OF THE STATUS OF THE LAND USE APPLICATION FROM THE LOCAL GOVERNMENTAL ENTITY THAT WILL PROVIDE THE PERMIT FOR THE DATA CENTER, IF AVAILABLE;

(II) A DESCRIPTION OF ANY APPLICABLE LOCAL INCENTIVES;

(III) A DESCRIPTION OF THE NEGOTIATED COMMUNITY BENEFITS;

AND

(IV) THE STATUS OF LOCAL PERMITS AND APPROVALS.

(4) Review and effect of certification. UPON RECEIPT OF AN APPLICATION FOR CERTIFICATION FROM A DATA CENTER OPERATOR, THE AUTHORITY SHALL REVIEW THE APPLICATION PURSUANT TO SECTION 24-48.5-807. IF THE AUTHORITY APPROVES THE DATA CENTER FOR CERTIFICATION, THE DATA CENTER OPERATOR BECOMES ELIGIBLE, AS OF THE DATE OF CERTIFICATION, FOR THE TAX BENEFITS SPECIFIED IN SECTION 24-48.5-807. Application review and certification process Colorado data center development authority.

(1) (a) THE AUTHORITY SHALL REVIEW ALL APPLICATIONS FOR CERTIFICATION SUBMITTED BY A DATA CENTER OPERATOR PURSUANT TO

SECTION 24-48.5-806. THE AUTHORITY SHALL DETERMINE WHETHER AN APPLICATION IS COMPLETE WITHIN THIRTY DAYS AFTER THE AUTHORITY'S RECEIPT OF THE APPLICATION. WITHIN NINETY DAYS OF DETERMINING THAT AN APPLICATION IS COMPLETE, THE AUTHORITY SHALL CONDUCT A FULL APPLICATION REVIEW PURSUANT TO THIS SECTION.

(b) IF THE AUTHORITY DETERMINES THAT AN APPLICATION IS DEFICIENT, THE AUTHORITY SHALL PROVIDE WRITTEN NOTIFICATION TO THE APPLICANT THAT IDENTIFIES THE SPECIFIC DEFICIENCIES.

AUTHORITY SHALL ALLOW THIRTY DAYS FOR THE APPLICANT TO CURE ANY DEFICIENCIES IN THE APPLICATION, AND THE AUTHORITY SHALL COMPLETE A REVIEW OF THE REVISED APPLICATION WITHIN THIRTY DAYS AFTER RECEIPT.

(c) THE WITHIN FOURTEEN DAYS OF RECEIVING A COMPLETE APPLICATION FOR CERTIFICATION FROM A DATA CENTER OPERATOR, THE AUTHORITY SHALL NOTIFY THE UTILITY THAT WILL PROVIDE ELECTRICITY FOR THE DATA CENTER, AS IDENTIFIED IN THE APPLICATION, OF THE APPLICATION. WITHIN SIXTY DAYS OF THE DATE THAT THE AUTHORITY NOTIFIES THE UTILITY, THE UTILITY SHALL:

(I) PURSUE ONE OF THE FOLLOWING METHODS TO VERIFY THAT THE DATA CENTER WILL NOT CAUSE UNREASONABLE COST IMPACTS TO OTHER UTILITY RATEPAYERS:

(A) SUBMITTING A TARGETED RESOURCE ACQUISITION APPLICATION TO THE COMMISSION PURSUANT TO SECTION 40-2-140 AND PROVIDING PROOF OF THE APPLICATION SUBMISSION TO THE AUTHORITY;

(B) PROVIDING A TECHNICAL REPORT TO THE AUTHORITY ATTESTING THAT THE UTILITY INFRASTRUCTURE COSTS ASSOCIATED WITH THE DATA CENTER ARE REASONABLY ALLOCATED AND ARE NOT EXPECTED TO CAUSE UNJUSTIFIED RATE INCREASES FOR OTHER CUSTOMERS; OR (C) PROPOSED AGREEMENT, OR SIMILAR AGREEMENT THAT IDENTIFIES REQUIRED UTILITY INFRASTRUCTURE UPGRADES AND CONFIRMS THAT THE DATA CENTER OPERATOR HAS AGREED OR WILL AGREE TO COVER ITS FAIR SHARE OF COSTS IN ACCORDANCE WITH THE UTILITY'S POLICY; AND (II) PROVIDING DOCUMENTATION TO THE AUTHORITY OF A INTERCONNECTION AGREEMENT , ELECTRIC SERVICE PROVIDE A WRITTEN FEASIBILITY ASSESSMENT TO THE AUTHORITY THAT INCLUDES A TIMELINE OF SERVICE.

(d) WITHIN FOURTEEN DAYS OF RECEIVING A COMPLETE APPLICATION FOR CERTIFICATION FROM A DATA CENTER OPERATOR THAT IDENTIFIES THAT THE DATA CENTER WILL USE WATER AS PART OF ITS COOLING SYSTEM, THE AUTHORITY SHALL NOTIFY THE UTILITY THAT WILL PROVIDE WATER FOR THE DATA CENTER, AS IDENTIFIED IN THE APPLICATION, OF THE APPLICATION. WITHIN SIXTY DAYS OF THE DATE THAT THE AUTHORITY NOTIFIES THE UTILITY, THE UTILITY SHALL PROVIDE DOCUMENTATION TO THE AUTHORITY ATTESTING THAT THE WATER MANAGEMENT PLAN FOR THE DATA CENTER IS SUFFICIENT AND WILL NOT NEGATIVELY IMPACT EXISTING CUSTOMERS EITHER THROUGH RATE INCREASES OR WATER AVAILABILITY.

(e) (I) IF A UTILITY FAILS TO PROVIDE THE AUTHORITY WITH ANY DOCUMENTATION, REPORT, ASSESSMENT, OR APPLICATION REQUIRED BY SUBSECTION (1)(c) OR (1)(d) OF THIS SECTION WITHIN THE REQUIRED TIME FRAME, THE AUTHORITY MAY PROCEED TO REVIEW AND APPROVE AN APPLICATION DOCUMENTATION, DOCUMENTATION, REPORT, ASSESSMENT, OR APPLICATION MUST BE ADDED TO THE APPLICATION FOR CERTIFICATION UPON THE AUTHORITY'S RECEIPT OF THE DOCUMENTATION, REPORT, ASSESSMENT, OR APPLICATION.

FOR CERTIFICATION REPORT, WITHOUT ASSESSMENT, OR THE REQUIRED APPLICATION.

THE

(II) IF AN ELECTRIC UTILITY FAILS TO PROVIDE THE AUTHORITY WITH A WRITTEN FEASIBILITY ASSESSMENT REQUIRED BY SUBSECTION (1)(c)(II) OF THIS SECTION WITHIN THE SIXTY-DAY TIME FRAME, THE AUTHORITY SHALL NOTIFY THE APPLICANT DATA CENTER OPERATOR AND THE COMMISSION OF THE ELECTRIC UTILITY'S FAILURE TO RESPOND.

THE AUTHORITY MAY APPROVE AN APPLICATION FOR CERTIFICATION IF THE APPLICATION MEETS ALL OF THE APPLICATION CRITERIA SPECIFIED IN SECTION 24-48.5-806.

(3) THE AUTHORITY MAY REJECT AN APPLICATION IF:

(a) THE AUTHORITY FINDS THAT THE DATA CENTER OPERATOR MATERIALLY MISREPRESENTED FACTS IN THE APPLICATION;

(b) THE AUTHORITY FINDS THAT THE DATA CENTER OPERATOR FAILED TO PROVIDE REQUIRED DOCUMENTATION AFTER THE AUTHORITY PROVIDED AN OPPORTUNITY TO CURE AN APPLICATION DEFICIENCY PURSUANT TO SUBSECTION (1)(b) OF THIS SECTION;

(c) THE AUTHORITY DETERMINES THAT THE DATA CENTER OPERATOR DOES NOT MEET MINIMUM CERTIFICATION REQUIREMENTS UNDER SECTION 24-48.5-806; OR

(d) THE PROGRAM IS CANCELED OR REPEALED PRIOR TO THE AUTHORITY'S REVIEW AND APPROVAL OF THE APPLICATION.

BEFORE REJECTING ANY APPLICATION THAT MEETS THE MINIMUM INVESTMENT AND JOB CREATION CRITERIA SET FORTH IN

SECTION 24-48.5-806, THE AUTHORITY SHALL:

(a) PROVIDE THE DATA CENTER OPERATOR AN OPPORTUNITY TO ADDRESS THE AUTHORITY'S CONCERNS; AND (b) EXPLORE ALTERNATIVE PATHS TO APPROVAL WITH CONDITIONS, IF POSSIBLE.

(5) IN IMPLEMENTING THE PROGRAM, THE AUTHORITY SHALL FACILITATE EFFICIENT DATA CENTER DEVELOPMENT BY ESTABLISHING CLEAR QUALIFICATION CRITERIA AND CONSISTENTLY ADMINISTERING A PREDICTABLE APPLICATION, REVIEW, AND APPROVAL PROCESS FOR DATA CENTER CERTIFICATION PURSUANT TO THIS PART 8.

(6) (a) THE AUTHORITY SHALL BEGIN PROCESSING AND REVIEWING APPLICATIONS FOR CERTIFICATION WITHIN ONE HUNDRED EIGHTY DAYS AFTER THE EFFECTIVE DATE OF THIS PART 8.

(b) THIS SUBSECTION (6) IS REPEALED, EFFECTIVE JULY 1, 2028.

24-48.5-808. Certification benefits - state sales and use tax exemption - compliance reports.

(1) State sales and use tax exemption.

(a) SUBJECT TO THE PROVISIONS OF SUBSECTION (1)(b) OF THIS SECTION, A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER IS ELIGIBLE FOR A ONE HUNDRED PERCENT STATE SALES AND USE TAX EXEMPTION ON QUALIFIED PURCHASES PURSUANT TO SECTION 39-26-735.

(b) UNLESS AN ELIGIBILITY PERIOD IS EXTENDED AS PROVIDED IN

SECTION 24-48.5-810, A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER IS ELIGIBLE FOR THE STATE SALES AND USE TAX EXEMPTION FOR TWENTY YEARS FROM THE DATE THAT THE DATA CENTER RECEIVED CERTIFICATION, SO LONG AS THE DATA CENTER OPERATOR:

(I) MAINTAINS THE QUALIFYING EMPLOYMENT AND COMPENSATION COMMITMENT SPECIFIED IN SECTION 24-48.5-806 (1)(b);

AND

(II) SUBMITS ANNUAL COMPLIANCE REPORTS TO THE AUTHORITY AS REQUIRED IN SUBSECTION (3) OF THIS SECTION.

(2) Exemption certificate. THE AUTHORITY SHALL ISSUE A STATE SALES AND USE TAX EXEMPTION CERTIFICATE TO THE DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER AS EVIDENCE THAT THE DATA CENTER OPERATOR IS ELIGIBLE FOR THE STATE SALES AND USE TAX EXEMPTION FOR QUALIFIED PURCHASES PURSUANT TO THIS SECTION AND SECTION CERTIFICATE MUST SPECIFY THAT THE DATA CENTER OPERATOR IS ENTITLED TO THE STATE SALES AND USE TAX EXEMPTION FOR TWENTY YEARS, BEGINNING ON THE DATE OF CERTIFICATION. A STATE SALES AND USE TAX EXEMPTION CERTIFICATE IS NONTRANSFERABLE. THE AUTHORITY SHALL CERTIFY TO THE DEPARTMENT THE NAME OF EACH DATA CENTER OPERATOR THAT RECEIVES A STATE SALES AND USE TAX EXEMPTION CERTIFICATE AND OTHER RELEVANT INFORMATION RELATING TO THE EXEMPTION.

39-26-735. THE STATE SALES AND USE TAX EXEMPTION Compliance reports. A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER SHALL SUBMIT AN ANNUAL COMPLIANCE REPORT TO THE AUTHORITY, IN A FORM AND MANNER TO BE DETERMINED BY THE AUTHORITY, TO VERIFY THAT THE DATA CENTER OPERATOR IS MAKING TIMELY PROGRESS IN SATISFYING THE REQUIREMENTS OF SECTION 24-48.5-806 AND IS ON TRACK TO SATISFY THE REQUIREMENTS WITHIN THE PERIODS SPECIFIED IN THAT SECTION. A DATA CENTER OPERATOR SHALL SUBMIT THE REPORT REQUIRED IN THIS SUBSECTION (3) TO MAINTAIN CERTIFICATION. THE DATA CENTER OPERATOR SHALL INCLUDE IN THE REPORT THE TOTAL AMOUNT OF THE STATE SALES AND USE TAX EXEMPTION CLAIMED EACH YEAR AND ANY OTHER INFORMATION REQUESTED BY THE AUTHORITY.

(4) Payment of tax upon revocation of certification. IF THE AUTHORITY REVOKES A DATA CENTER'S CERTIFICATION PURSUANT TO

SECTION 24-48.5-809 (2), THE DATA CENTER OPERATOR SHALL PAY THE ENTIRE AMOUNT OF THE STATE SALES AND USE TAX ON ANY QUALIFIED PURCHASE FOR WHICH THE STATE SALES AND USE TAX EXEMPTION WAS CLAIMED PURSUANT TO THIS PART 8 AND SECTION 39-26-735.

24-48.5-809. Post-certification data center requirements revocation.

(1) A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER SHALL:

(a) MAINTAIN ALL COMMITMENTS AND REQUIREMENTS SET FORTH IN SECTION 24-48.5-806 THROUGHOUT ITS TWENTY-YEAR BENEFIT PERIOD;

AND

(b) SUBMIT THE ANNUAL COMPLIANCE REPORTS REQUIRED BY SECTION 24-48.5-808 (3).

(2) (a) EXCEPT AS PROVIDED IN SUBSECTION (4) OF THIS SECTION, THE AUTHORITY MAY REVOKE A CERTIFICATION THAT IT HAS AWARDED IF THE AUTHORITY DETERMINES THAT THE DATA CENTER OPERATOR HAS:

(I) FAILED TO MAKE SUBSTANTIAL PROGRESS TOWARD SATISFYING THE TWENTY-FOUR MONTHS OF THE DATA CENTER BEING PLACED IN SERVICE OR RECEIPT OF A FINAL CERTIFICATE OF OCCUPANCY;

REQUIREMENTS SECTION WITHIN WOULD HAVE DISQUALIFIED IT FROM CERTIFICATION; OR

(III) FAILED TO MAINTAIN COMPLIANCE WITH THE CRITERIA THAT FORMED THE BASIS OF APPROVAL AND CERTIFICATION.

(b) BEFORE REVOKING A CERTIFICATION THAT IT HAS AWARDED, THE AUTHORITY SHALL PROVIDE THE DATA CENTER OPERATOR WITH:

(I) WRITTEN NOTICE SPECIFYING THE GROUNDS FOR POTENTIAL REVOCATION;

(II) AT LEAST ONE HUNDRED TWENTY DAYS TO REMEDY THE GROUNDS COMPLIANCE; AND IN

(II) MATERIALLY CHANGED THE DATA CENTER IN A WAY THAT SPECIFIED FOR POTENTIAL REVOCATION AND TO DEMONSTRATE

(III) AN OPPORTUNITY TO PRESENT EVIDENCE AND ARGUMENTS TO THE AUTHORITY.

(3) THE AUTHORITY SHALL USE THE REPORTS THAT A DATA CENTER OPERATOR IS REQUIRED TO SUBMIT TO THE AUTHORITY PURSUANT TO

SECTION 24-48.5-808 (3) TO ENSURE THAT A CERTIFIED DATA CENTER REMAINS IN COMPLIANCE WITH PROGRAM REQUIREMENTS.

(4) THE AUTHORITY SHALL NOT REVOKE CERTIFICATION BASED ON:

(a) CHANGES TO ELECTRIC UTILITY RATES, COST ALLOCATIONS, OR RESOURCE COMMISSION;

PLANS MADE THROUGH PROCEEDINGS BEFORE THE

(b) CHANGES TO WATER UTILITY RATES OR SERVICE TERMS MADE BY A WATER UTILITY, UNLESS SUCH CHANGES ARE CAUSED BY WATER SCARCITY OR FORCE MAJEURE; OR

(c) CHANGES TO FEDERAL, STATE, OR LOCAL ENVIRONMENTAL LAWS OR REGULATIONS THAT OCCUR AFTER A DATA CENTER'S CERTIFICATION, DEMONSTRATES GOOD FAITH EFFORTS TO ACHIEVE COMPLIANCE WITH THE CHANGED LAWS OR REGULATIONS WITHIN A REASONABLE TIME.

PROVIDED THAT THE DATA CENTER OPERATOR Certification benefits extension - duration - extension eligibility - extension terms.

(1) A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER MAY APPLY TO THE AUTHORITY, IN A FORM AND MANNER DETERMINED BY THE AUTHORITY AND NO EARLIER THAN TEN YEARS AFTER OBTAINING ITS INITIAL CERTIFICATION, FOR AN EXTENSION OF ITS CERTIFICATION BENEFITS. TO BE ELIGIBLE FOR AN EXTENSION OF ITS CERTIFICATION BENEFITS, A DATA CENTER OPERATOR MUST DEMONSTRATE THAT:

(a) DURING THE INITIAL TWENTY-YEAR BENEFIT PERIOD, THE DATA CENTER OPERATOR, OR THE DATA CENTER OPERATOR COLLECTIVELY WITH ITS PARTICIPATING DATA CENTER TENANTS, HAS MADE INVESTMENTS IN DATA CENTER QUALIFIED PURCHASES IN A TOTAL AMOUNT OF AT LEAST FIVE MILLION DOLLARS IN ADDITION TO THE MINIMUM INVESTMENT THAT THE DATA CENTER OPERATOR WAS REQUIRED TO MAKE PURSUANT TO

SECTION 24-48.5-806;

(b) DURING THE INITIAL TWENTY-YEAR BENEFIT PERIOD, THE DATA CENTER OPERATOR, OR THE DATA CENTER OPERATOR COLLECTIVELY WITH ITS PARTICIPATING DATA CENTER TENANTS, HAS CREATED AT LEAST TEN NEW QUALIFYING JOBS IN ADDITION TO THE JOBS THAT THE DATA CENTER OPERATOR CREATED TO SATISFY THE REQUIREMENTS OF SECTION 24-48.5-806; AND

(c) THE CERTIFIED DATA CENTER CONTINUES TO COMPLY WITH ENVIRONMENTAL REQUIREMENTS.

(2) A DATA CENTER OPERATOR OF A CERTIFIED DATA CENTER THAT IS APPROVED FOR AN EXTENSION OF ITS CERTIFICATION BENEFITS BY THE AUTHORITY PURSUANT TO THIS SECTION IS ELIGIBLE:

(a) FOR AN ADDITIONAL TEN YEARS OF ELIGIBILITY TO CLAIM THE STATE SALES AND USE TAX EXEMPTION ALLOWED PURSUANT TO THIS PART 8 AND SECTION 39-26-735; AND

(b) TO MAINTAIN ITS CERTIFICATION, PROVIDED THAT THE DATA CENTER REQUIREMENTS IMPOSED BY THIS PART 8.

CONTINUES TO MEET ALL APPLICABLE CERTIFICATION 24-48.5-811. No restriction on local government authority and coordination.

THIS PART 8 DOES NOT LIMIT A LOCAL GOVERNMENT'S AUTHORITY REGARDING THE REGULATION OF DATA CENTERS, INCLUDING TAXATION, INCENTIVES, LAND USE, PERMITTING, AND NUISANCE. THIS PART 8 DOES NOT LIMIT ANY LOCAL ENVIRONMENTAL REGULATION. IN ADDITION, THIS PART 8 DOES NOT RESTRICT LOCAL INCENTIVES, INCLUDING UTILITY INCENTIVES IN THE CASE OF A MUNICIPALLY OWNED UTILITY. THIS PART 8 DOES NOT REQUIRE LOCAL GOVERNMENTS TO PARTICIPATE IN THE PROGRAM.

SECTION 2. In Colorado Revised Statutes, 24-75-402, amend (5)(mmm) and (5)(nnn); and add (5)(ooo) as follows: 24-75-402. Cash funds - limit on uncommitted reserves reduction in the amount of fees - exclusions - definitions.

(5) Notwithstanding any provision of this section to the contrary, the following cash funds are excluded from the limitations specified in this section:

(mmm) The reentry services for justice-involved individuals reinvestment cash fund created in section 25.5-4-505.7; and (nnn) The health-related social needs reinvestment cash fund created in section 25.5-5-340; AND (ooo) THE DATA CENTER DEVELOPMENT AND INCENTIVE PROGRAM CASH FUND CREATED IN SECTION 24-48.5-805 (4).

SECTION 3. In Colorado Revised Statutes, add 40-2-140 as follows: 40-2-140. Targeted resource acquisition - emerging large-load customers - process - funding - definitions. (1) Definitions. AS USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE REQUIRES:

(a) "ADVANCED CARBON-FREE TECHNOLOGY" MEANS ELECTRIC GENERATION TECHNOLOGY OR RESOURCES, INCLUDING LONG-DURATION ENERGY STORAGE, THAT CAN BE TURNED ON OR OFF, OR OTHERWISE HAVE THEIR POWER OUTPUT ADJUSTED, BASED ON DEMAND SO AS TO ENABLE OPERATION OF A CARBON-FREE ELECTRIC SYSTEM.

(b) "EMERGING LARGE-LOAD CUSTOMER" MEANS A CUSTOMER OF A UTILITY WITH PROJECTED LOAD REQUIREMENTS OF AT LEAST ONE HUNDRED MEGAWATTS, EITHER INDIVIDUALLY OR IN THE AGGREGATE THROUGH COLOCATED CUSTOMERS.

(c) "NAMEPLATE CAPACITY" MEANS THE MAXIMUM RATED OUTPUT OF AN ELECTRIC GENERATOR, OR OTHER ELECTRIC POWER PRODUCTION EQUIPMENT, MANUFACTURER.

(d) UNDER SPECIFIC CONDITIONS DESIGNATED BY THE "UTILITY" MEANS A UTILITY REGULATED UNDER THE COMMISSION'S RESOURCE PLANNING AUTHORITY.

(2) Eligibility for targeted resource acquisition. A UTILITY MAY SUBMIT TO THE COMMISSION A TARGETED RESOURCE ACQUISITION APPLICATION DESCRIBING HOW THE UTILITY INTENDS TO MEET ENERGY AND CAPACITY NEEDS CREATED BY ONE OR MORE EMERGING LARGE-LOAD CUSTOMERS. FOR A UTILITY TO BE ELIGIBLE TO SUBMIT A TARGETED RESOURCE ACQUISITION APPLICATION TO THE COMMISSION, EMERGING LARGE-LOAD CUSTOMERS OF THE UTILITY MUST:

(a) ENTER INTO A CONTRACTUAL AGREEMENT WITH THE UTILITY, WHICH AGREEMENT INCLUDES:

(I) MINIMUM DEMAND, DURATION, AND BILLING COMMITMENTS; OR

(II) PARTICIPATION IN ANY APPLICABLE LARGE-LOAD TARIFF INTENDED TO BALANCE LOAD FACTOR;

(b) AGREE TO EXIT FEE PROVISIONS THAT ADDRESS EARLY DEPARTURE OR REDUCED DEMAND, INCLUDING BUT NOT LIMITED TO A THREE-YEAR EXIT FEE STRUCTURE TO ENSURE REVENUE STABILITY;

(c) PROVIDE APPROPRIATE CREDIT SECURITIZATION; AND (d) DEMONSTRATE SITE CONTROL AND SUBMIT SIGNED DEVELOPMENT AGREEMENTS TO THE UTILITY.

(3) Resource acquisition process.

(a) PRIOR TO FILING A TARGETED RESOURCE ACQUISITION APPLICATION UNDER THIS SECTION, A UTILITY MAY ISSUE A COMPETITIVE SOLICITATION TO IDENTIFY POTENTIAL RESOURCES TO SERVE AN EMERGING LARGE-LOAD CUSTOMER.

(b) AS PART OF THE TARGETED RESOURCE ACQUISITION APPLICATION, THE UTILITY MAY PROPOSE SYSTEM ASSETS FUNDED IN WHOLE OR IN PART BY THE EMERGING LARGE-LOAD CUSTOMER. ALL SUCH ASSETS MUST OPERATE AS SYSTEM ASSETS FOR THE BENEFIT OF ALL CUSTOMERS.

(c) FOR TARGETED RESOURCE ACQUISITION APPLICATIONS SUBMITTED ON OR BEFORE DECEMBER 31, 2039:

(I) STANDALONE RESOURCE PORTFOLIOS PROPOSED IN THE TARGETED RESOURCE ACQUISITION APPLICATION MUST TARGET A THREE-TO-ONE RATIO ON A NAMEPLATE CAPACITY BASIS BETWEEN CARBON DIOXIDE NONEMITTING AND EMITTING RESOURCES.

(II) STANDALONE STORAGE DISTRIBUTED ENERGY RESOURCES DEVELOPED FOR THE EMERGING LARGE-LOAD CUSTOMER, OR PROCURED BY THE EMERGING LARGE-LOAD CUSTOMER VIA UTILITY PROGRAMS, RECEIVE A TWO-TIMES MULTIPLIER BONUS ON THE NAMEPLATE CAPACITY VALUE IN A RATIO CALCULATION. GRID-CONNECTED SOLAR DISTRIBUTED EN ERGY ONE-AND-ONE-QUARTER-TIMES MULTIPLIER BONUS ON THE NAMEPLATE CAPACITY VALUE IN A RATIO CALCULATION; EXCEPT THAT THE MULTIPLIER BONUS ONLY APPLIES TO THE SOLAR RESOURCES IF THE STORAGE COMPONENT OF THE HYBRID PROJECT EXCEEDS THE SOLAR PORTION.

RESOURCES PAIRED WITH STORAGE RECEIVE A

(III) (A) IF THE STANDALONE RESOURCE PORTFOLIO, INCLUDING ANY DISTRIBUTED ENERGY RESOURCE MULTIPLIER BONUS, DOES NOT MEET THE ACQUISITION APPLICATION MUST INCLUDE A PROPOSAL FOR THE EMERGING LARGE-LOAD CUSTOMER TO FUND ADVANCED CARBON-FREE TECHNOLOGY VIA UTILITY-ADMINISTRATED FUNDING PROGRAMS FOR SUCH TECHNOLOGY.

(B) AS THE RATIO OF THE PROPOSED STANDALONE RESOURCE PORTFOLIO FALLS BELOW THE THREE-TO-ONE TARGET RATIO, THE THREE-TO-ONE EITHER A TARGET CLEAN RATIO, THE TRANSITION TARGETED TARIFF OR RESOURCE THROUGH PROPOSED FUNDING FROM THE EMERGING LARGE-LOAD CUSTOMER MUST INCREASE ON A COMMENSURATE BASIS.

REQUIRED WILL BE CALCULATED USING THE DIFFERENCE BETWEEN THE PROPOSED RATIO AND THE THREE-TO-ONE TARGET RATIO, WITH THE EXPECTED OPERATION OF THE INCREMENTAL EMITTING GENERATION MULTIPLIED BY A VALUE DETERMINED BY THE COMMISSION AS REQUIRED TO SET THE AMOUNT OF FUNDING THAT NEEDS TO BE PROVIDED BY THE EMERGING LARGE-LOAD CUSTOMER TO FUND ADVANCED CARBON-FREE TECHNOLOGY.

(d) THE INCREASED FUNDING FOR TARGETED RESOURCE ACQUISITION APPLICATIONS SUBMITTED ON OR AFTER JANUARY 1, 2040, ALL PROPOSED RESOURCES MUST BE RENEWABLE AND CLEAN ENERGY RESOURCES AS DESCRIBED IN

SECTION 24-48.5-803 (12).

(e) ANY RESOURCES PROPOSED IN THE TARGETED RESOURCE ACQUISITION ACCREDITED CAPACITY, AS DETERMINED BY THE UTILITY, TO MEET THE NEEDS OF THE EMERGING LARGE-LOAD CUSTOMER WITHIN THE REQUIRED INTERCONNECTION TIME FRAME, WHICH TIME FRAME MAY BE PHASED AS THE LOAD SCALES.

APPLICATION MUST HAVE SUFFICIENT CUMULATIVE

(f) AS PART OF A TARGETED RESOURCE ACQUISITION APPLICATION, THE UTILITY SHALL ENSURE THAT AT LEAST THIRTY PERCENT OF THE RESOURCES AND INFRASTRUCTURE PROPOSED IN THE APPLICATION SUPPORT CONSUMER-FACING PROGRAMS FOR SOLAR ENERGY SYSTEMS, BATTERY TECHNOLOGY.

ENERGY STORAGE SYSTEMS, AND LOAD REDUCTION

(g) IN CONNECTION WITH A TARGETED RESOURCE ACQUISITION APPLICATION, THE UTILITY MUST:

(I) USE THE REQUEST FOR PROPOSAL DOCUMENTS MOST RECENTLY APPROVED BY THE COMMISSION, WITH CUSTOMIZATION ALLOWED TO REFLECT THE SPECIFIC SOLICITATION AND AVOID COST SHIFTS TO OTHER CUSTOMERS; AND

(II) BE PERMITTED TO BRING FORWARD RECENT BIDS RECEIVED WITHIN THE PREVIOUS TWO YEARS IF THE BID PRICES REMAIN GENERALLY CONSISTENT WITH THE PREVIOUSLY SUBMITTED TERMS.

(h) THE UTILITY MUST INCLUDE IN A TARGETED RESOURCE ACQUISITION APPLICATION AN UPDATED EMISSIONS WORKBOOK THAT REFLECTS:

(I) TOTAL MEGAWATT-HOURS AND ASSOCIATED EMISSIONS ATTRIBUTABLE TO THE EMERGING LARGE-LOAD CUSTOMER; AND (II) SEPARATE REPORTING FOR EACH DISCRETE EMERGING LARGE-LOAD CUSTOMER IN THE CASE OF COLOCATED ARRANGEMENTS, TO THE EXTENT PRACTICABLE.

(i) APPROVAL OF A TARGETED RESOURCE ACQUISITION APPLICATION UNDER THIS SECTION CREATES A PRESUMPTION OF PRUDENCE FOR ALL INFRASTRUCTURE OR RESOURCE INVESTMENTS NECESSARY TO SERVE THE EMERGING LARGE-LOAD CUSTOMER.

(j) THE STANDARD OF REVIEW FOR THE TARGETED RESOURCE ACQUISITION APPLICATION IS WHETHER THE PROPOSED ACQUISITION AND ASSOCIATED INFRASTRUCTURE ARE IN THE PUBLIC INTEREST.

(k) THE UTILITY NEED NOT OBTAIN A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY PURSUANT TO SECTION 40-5-102 FOR SPECIFIC RESOURCES AND INFRASTRUCTURE IDENTIFIED IN AND APPROVED THROUGH THE APPLICATION.

(l) THE COMMISSION SHALL ACT ON THE APPLICATION WITHIN ONE HUNDRED TWENTY DAYS AFTER THE FILING OF THE APPLICATION. THE PERIOD FOR OTHER PERSONS TO INTERVENE IN THE MATTER IS WITHIN TEN DAYS AFTER THE FILING OF THE APPLICATION.

(4) Funding and cost recovery.

(a) A UTILITY MAY INCLUDE IN THE UTILITY'S TARGETED RESOURCE ACQUISITION APPLICATION PRE-FUNDING COMMITMENTS FROM THE EMERGING LARGE-LOAD CUSTOMER FOR PRE-DEVELOPMENT AND EARLY CONSTRUCTION COSTS OF RESOURCES OR INFRASTRUCTURE, INCLUDING TRANSMISSION AND DISTRIBUTION.

(b) THE EMERGING LARGE-LOAD CUSTOMER MAY ENTIRELY BEAR THE COSTS ASSOCIATED WITH THE EMERGING LARGE LOAD, BUT THE UTILITY APPROPRIATE PORTION OF THESE COSTS THROUGH AN EXISTING COST-RECOVERY MECHANISM.

MAY (c) ALSO PROPOSE PARTIAL REIMBURSEMENT OF AN THE UTILITY MAY RECOVER COSTS ASSOCIATED WITH RESOURCES AND INFRASTRUCTURE DEVELOPED PURSUANT TO AN APPROVED APPLICATION THROUGH AN ADJUSTMENT CLAUSE UNTIL INCLUDED IN THE RATE BASE IN A FUTURE RATE CASE. THE UTILITY MAY RECOVER TRANSMISSION COSTS THROUGH A TRANSMISSION ADJUSTMENT CLAUSE AND DISTRIBUTION COSTS THROUGH A GRID MODERNIZATION ADJUSTMENT CLAUSE.

(d) THE COMMISSION SHALL APPROVE THE REIMBURSEMENT RECOVERY IF THE ACQUIRED RESOURCES OR INFRASTRUCTURE PROVIDE SYSTEM-WIDE BENEFITS.

(5) Advanced carbon-free technology fund.

(a) A UTILITY MAY PROPOSE THE CREATION OF AN ADVANCED CARBON-FREE TECHNOLOGY FUND, TO WHICH EMERGING LARGE-LOAD CUSTOMERS MAY CONTRIBUTE VOLUNTARILY.

(b) A UTILITY MAY USE THE FUND TO:

(I) COVER PRE-DEVELOPMENT AND EARLY CONSTRUCTION COSTS FOR SYSTEM RESOURCES AND INFRASTRUCTURE;

(II) SUPPORT UTILITY EXPLORATION OR DEPLOYMENT OF ADVANCED CARBON-FREE TECHNOLOGY;

(III) ALLOW EMERGING LARGE-LOAD CUSTOMERS TO BENEFIT FROM CLEAN FIRM DISPATCHABLE TECHNOLOGY LOCATED NEAR THEIR OPERATIONS IN EXCHANGE FOR THEIR CONTRIBUTIONS; AND

(IV) MITIGATE OR ALLOCATE TECHNOLOGY PERFORMANCE RISK ASSOCIATED WITH ADVANCED CARBON-FREE TECHNOLOGY, SUBJECT TO THE COMMISSION'S REVIEW AND APPROVAL.

(c) IF A UTILITY IS NOT ABLE TO USE MONEY THAT IS CONTRIBUTED TO THE FUND FOR THE PURPOSES SPECIFIED IN SUBSECTION (5)(b) OF THIS SECTION BECAUSE AN EMERGING LARGE-LOAD PROJECT DOES NOT MATERIALIZE, THE UTILITY MAY USE MONEY THAT IS CONTRIBUTED TO THE FUND TO OFFSET INFRASTRUCTURE AND RESOURCE COSTS FOR THE BENEFIT OF OTHER CUSTOMERS.

SECTION 4. In Colorado Revised Statutes, 29-2-105, amend (1)(d)(I)(T) and (1)(d)(I)(U); and add (1)(d)(I)(V) as follows:

29-2-105. Contents of sales tax ordinances and proposals.

(1) The sales tax ordinance or proposal of any incorporated town, city, or county adopted pursuant to this article 2 shall be imposed on the sale of tangible personal property at retail or the furnishing of services, as provided in subsection (1)(d) of this section. Any countywide or incorporated town or city sales tax ordinance or proposal shall include the following provisions:

(d) (I) A provision that the sale of tangible personal property and services taxable pursuant to this article 2 is the same as the sale of tangible personal property and services taxable pursuant to section 39-26-104, except as otherwise provided in this subsection (1)(d). The sale of tangible personal property and services taxable pursuant to this article 2 is subject to the same sales tax exemptions as those specified in part 7 of article 26 of title 39; except that the sale of the following may be exempted from a town, city, or county sales tax only by the express inclusion of the exemption either at the time of adoption of the initial sales tax ordinance or resolution or by amendment thereto:

(T) The exemption for sales of heat pump systems and heat pump water heaters set forth in section 39-26-732; and (U) The exemption for sales of energy storage systems set forth in section 39-26-733; AND

(V) THE EXEMPTION SET FORTH IN SECTION 39-26-735 FOR SALES OF INFORMATION TECHNOLOGY INFRASTRUCTURE AND DATA CENTER INFRASTRUCTURE AND TRANSMISSION AND GENERATION SYSTEM ASSETS.

SECTION 5. In Colorado Revised Statutes, add 39-26-735 as follows:

39-26-735. Certified data centers - qualified purchases - information technology infrastructure - data center infrastructure - tax preference performance statement - legislative declaration - definitions.

(1) (a) IN ACCORDANCE WITH SECTION 39-21-304, WHICH REQUIRES EACH BILL THAT CREATES A NEW TAX EXPENDITURE TO INCLUDE A TAX PREFERENCE PERFORMANCE STATEMENT AS PART OF A STATUTORY LEGISLATIVE DECLARATION, THE GENERAL ASSEMBLY FINDS AND DECLARES THAT THE PURPOSES OF THE TAX EXPENDITURE CREATED IN SUBSECTION (3) OF THIS SECTION ARE TO:

(I) IMPROVE INDUSTRY COMPETITIVENESS, SPECIFICALLY IN DATA CENTER DEVELOPMENT; AND

(II) PROVIDE TAX RELIEF TO CERTAIN BUSINESSES, SPECIFICALLY DATA CENTER OPERATORS THAT OWN OR OPERATE A CERTIFIED DATA CENTER IN THE STATE.

(b) THE GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL MEASURE THE EFFECTIVENESS OF THE TAX EXPENDITURE IN ACHIEVING THE PURPOSES SPECIFIED IN SUBSECTION (1)(a) OF THIS SECTION BASED ON THE NUMBER OF CERTIFIED DATA CENTERS THAT ARE CONSTRUCTED AND PLACED IN SERVICE IN THE STATE AND THE NUMBER AND VALUE OF THE EXEMPTIONS CLAIMED PURSUANT TO THIS SECTION. THE AUTHORITY SHALL PROVIDE THE STATE AUDITOR WITH ANY AVAILABLE INFORMATION THAT WOULD ASSIST IN THE STATE AUDITOR'S ANALYSIS.

(2) AS USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE REQUIRES:

(a) "CERTIFIED DATA CENTER" MEANS A DATA CENTER THAT HAS OBTAINED CERTIFICATION FROM THE AUTHORITY PURSUANT TO PART 8 OF ARTICLE 48.5 OF TITLE 24.

(b) "COLORADO DATA CENTER DEVELOPMENT AUTHORITY" OR "AUTHORITY" MEANS THE COLORADO DATA CENTER DEVELOPMENT AUTHORITY CREATED IN SECTION 24-48.5-804.

(c) "QUALIFIED DATA CENTER INFRASTRUCTURE AND SYSTEMS" MEANS INFORMATION TECHNOLOGY INFRASTRUCTURE AND DATA CENTER INFRASTRUCTURE AND TRANSMISSION AND GENERATION SYSTEM ASSETS, AS DESCRIBED IN SECTION 24-48.5-803 (11).

(d) "STATE SALES AND USE TAX EXEMPTION CERTIFICATE" MEANS A STATE SALES AND USE TAX EXEMPTION CERTIFICATE ISSUED BY THE AUTHORITY TO A CERTIFIED DATA CENTER PURSUANT TO PART 8 OF ARTICLE 48.5 OF TITLE 24.

BEGINNING JANUARY 1, 2027, ALL SALES AND USE OF QUALIFIED DATA CENTER INFRASTRUCTURE AND SYSTEMS THAT WILL BE PURCHASED AND USED IN CONNECTION WITH A CERTIFIED DATA CENTER FOR WHICH A DATA CENTER OPERATOR HAS A STATE SALES AND USE TAX EXEMPTION CERTIFICATE IS EXEMPT FROM TAXATION UNDER PARTS 1 AND 2 OF THIS ARTICLE 26.

(4) NOTWITHSTANDING SECTION 39-21-304 (4), THE EXEMPTION ALLOWED PURSUANT TO THIS SECTION CONTINUES INDEFINITELY.

SECTION 6. Applicability. This act applies to data centers for which the building or the purchase of equipment or regulated resource acquisitions commence on or after the effective date of this act.

SECTION 7.

Safety clause. The general assembly finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, or safety or for appropriations for the support and maintenance of the departments of the state and state institutions.