Governor’s Signature Represents Huge Win for Heavy-Duty Natural Gas Vehicles

Indiana Gov. Mike Pence has signed into law H.B.1324, a bill that creates a tax credit for the deployment of heavy-duty natural gas vehicles (NGVs) that exceed 33,000 lbs. GVWR, among other measures.

The legislation was passed in the state House and Senate earlier this year – unanimously upon its first vote, in the case of the House – having drawn strong bipartisan support in both chambers.

The tax covers up to 50% of the incremental cost of a heavy-duty NGV that runs on either compressed natural gas (CNG) or liquefied natural gas (LNG). The credit is capped at $15,000, and fleet operators and individuals can access up to $150,000 in credits per taxable year, from 2014 to 2016.

The bill created provisions for the collection of a state gross retail tax and motor carrier fuel tax on alternative fuels used in transportation applications, but some alt-fuel vehicles are now excluded from the alternative fuel decal law, and there is now a refundable road tax credit to carriers that use CNG in large trucks.

The legislation has also implemented an increase in the threshold at which state fleets are mandated to buy NGVs, propane autogas vehicles and other alt-fuel vehicles.

Previously, if an alt-fuel vehicle's price was less than 10% higher than the cost of a comparable vehicle, fleets were required to buy the alt-fuel vehicle. That threshold has been raised to 20%, which expands the potential for more alt-fuel vehicles to make their way into government fleets.

More information about the new law is available HERE.

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