Short title

This Act may be cited as the

Recycling Investment Saves Energy

or the

RISE Act

Findings

The Congress finds the following: (1)Recycling means business in the United States, with more than 56,000 reuse and recycling establishments that employ over 1,100,000 people, generating an annual payroll of nearly $37,000,000,000, and grossing over $236,000,000,000 in annual revenues. In 2005, recycling scrap materials accounted for $15,700,000,000 in exports for the United States. On a per-ton basis, sorting and processing recyclables alone sustain 10 times more jobs than landfilling or incineration. (2)By reducing the need to extract and process virgin raw materials into manufacturing feedstock, reuse and recycling helps achieve significant energy savings. For example: (A)Taken together, the amount of energy wasted from not recycling aluminum and steel cans, paper, printed materials, glass, and plastic equals the annual output of 15 medium sized power plants. (B)The reuse of 500 steel drums per week yields 6 trillion Btu’s per year, which is enough energy savings to power a city the size of Colorado Springs, Colorado, for 1 year. (3)Unfortunately, the United States recycling rate of many consumer commodities, including aluminum, glass, and plastic, are stagnant or declining, and businesses that rely on recycled feedstock are finding it difficult to obtain the quantity and quality of recycled materials needed. Increasingly, United States manufacturing facilities that rely on recycled feedstock are closing or forced to re-tool to use virgin materials. (4)The environmental impacts from reuse and recycling are significant. Increased reuse and recycling would produce significant environmental benefits, such as cleaner air, safer water, and reduced production costs. For example: (A)Between 2 and 5 percent of the waste stream is reusable. Reuse prevents waste creation and adverse impacts from disposal. (B)On a per-ton basis, recycling of: office paper prevents 60 pounds of air pollutants from being released, saves 7,000 gallons of water, and 3.3 cubic yards of landfill space; aluminum saves 10 cubic yards of landfill space; plastic saves 30 cubic yards of landfill space; glass prevents 7.5 pounds of air pollutants from being released and saves 2 cubic yards of landfill space; and steel saves 4 cubic yards of landfill space. (C)The manufacture of 100 percent recycled paperboard products uses significantly less fossil fuel than comparable products and is therefore a net reducer of greenhouse gases. And, for every 100 tons of recycled paperboard produced, 105 tons of material is prevented from going to the landfill, thus reducing landfill gases. (5)A national investment in the reuse and recycling industries is needed to preserve and expand America’s reuse and recycling infrastructure.

Special depreciation allowance for certain reuse and recycling property

(a)

In general

Section 168 of the Internal Revenue Code of 1986 (relating to accelerated cost recovery system) is amended by adding at the end the following new subsection:

(l)

Special allowance for certain reuse and recycling property

(1)

In general

In the case of any qualified reuse and recycling property— (A)the depreciation deduction provided by section 167(a) for the taxable year in which such property is placed in service shall include an allowance equal to 50 percent of the adjusted basis of the qualified reuse and recycling property, and (B)the adjusted basis of the qualified reuse and recycling property shall be reduced by the amount of such deduction before computing the amount otherwise allowable as a depreciation deduction under this chapter for such taxable year and any subsequent taxable year. (2)

Qualified reuse and recycling property

For purposes of this subsection— (A)

In general

The term qualified reuse and recycling property means any reuse and recycling property— (i)to which this section applies, (ii)which has a useful life of at least 5 years, (iii)the original use of which commences with the taxpayer after December 31, 2006, and (iv)which is— (I)acquired by purchase (as defined in section 179(d)(2)) by the taxpayer after December 31, 2006, but only if no written binding contract for the acquisition was in effect before January 1, 2007, or (II)acquired by the taxpayer pursuant to a written binding contract which was entered into after December 31, 2006. (B)

Exceptions

(i)

Alternative depreciation property

The term qualified reuse and recycling property shall not include any property to which the alternative depreciation system under subsection (g) applies, determined without regard to paragraph (7) of subsection (g) (relating to election to have system apply). (ii)

Election out

If a taxpayer makes an election under this clause with respect to any class of property for any taxable year, this subsection shall not apply to all property in such class placed in service during such taxable year. (C)

Special rule for self-constructed property

In the case of a taxpayer manufacturing, constructing, or producing property for the taxpayer's own use, the requirements of clause (iv) of subparagraph (A) shall be treated as met if the taxpayer begins manufacturing, constructing, or producing the property after December 31, 2006. (D)

Deduction allowed in computing minimum tax

For purposes of determining alternative minimum taxable income under section 55, the deduction under subsection (a) for qualified reuse and recycling property shall be determined under this section without regard to any adjustment under section 56. (3)

Definitions

For purposes of this subsection— (A)

Reuse and recycling property

(i)

In general

The term reuse and recycling property means any machinery and equipment (not including buildings or real estate), along with all appurtenances thereto, including software necessary to operate such equipment, which is used exclusively to collect, distribute, or recycle qualified reuse and recyclable materials. (ii)

Exclusion

Such term does not include— (I)rolling stock or other equipment used to transport reuse and recyclable materials, and (II)equipment used to produce new products or commodities from recycled products. (B)

Qualified reuse and recyclable materials

(i)

In general

The term qualified reuse and recyclable materials means scrap plastic, scrap glass, scrap textiles, scrap rubber, scrap packaging, recovered fiber, scrap ferrous and nonferrous metals, or electronic scrap generated by an individual or business. (ii)

Electronic scrap

For purposes of clause (i), the term electronic scrap means— (I)any cathode ray tube, flat panel screen, or similar video display device with a screen size greater than 4 inches measured diagonally, or (II)any central processing unit.

(b)

Effective date

The amendment made by this section shall apply to property placed in service after December 31, 2006.