Short title; table of contents

(a)

Short title

This Act may be cited as the Climate Change Rebate Act of 2008. (b)

Table of contents

The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Rebate financing.

Sec. 3. Climate change tax credit for working families and senior citizens.

Sec. 4. Climate change rebates for low-income households.

Sec. 5. LIHEAP and weatherization.

Rebate financing

If Federal legislation is enacted that would limit the emission of greenhouse gasses, 35 percent of the total value of emissions allowances created by such legislation shall be auctioned each year and the receipts from that auction deposited in the Treasury, for the purpose of carrying out the purposes of this Act.

Climate change tax credit for working families and senior citizens

(a)

In general

Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by redesignating section 37 as section 38 and by inserting after section 36 the following new section:

37.

Climate change tax credit

(a)

In general

In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to the energy cost increase attributable to carbon regulation. (b)

Energy cost increase attributable to carbon regulation

For purposes of this section— (1)

In general

The energy cost increase attributable to carbon regulation for any taxable year shall be an amount equal to the applicable percentage of the base projected energy cost increase. (2)

Applicable percentage

The applicable percentage shall be determined in accordance with the following table: In the case of:With:The applicable percentage is: An eligible individual making a joint returnNo qualifying children155 1 qualifying child180 2 or more qualifying children200 An eligible individual not making a joint returnNo qualifying children100 1 qualifying child155 2 qualifying children180

(3)

Base projected energy cost increase

The term base projected energy cost increase means the base projected cost increase in effect under the Climate Change Rebate Program (section 4 of the Climate Change Rebate Act of 2008) for the calendar in which the taxable year of the taxpayer begins. (c)

Limitations

(1)

Phase-in

In the case of a taxpayer with earned income for the taxable year of less than $8,000 ($13,500 in the case of a joint return or head of household), the amount allowed as a credit under subsection (a) shall not exceed the amount which bears the same ratio to the amount which would be so allowed as— (A)the earned income of the taxpayer for the taxable year, bears to (B)$8,000 ($13,500 in the case of a joint return or head of household). (2)

Phase-out

(A)

In general

The amount which would (but for this paragraph) be allowed as a credit under subsection (a) shall be reduced (but not below zero) by the amount determined under subparagraph (B). (B)

Amount of reduction

The amount determined under this subparagraph is the amount which bears the same ratio to the amount which would be so allowed as— (i)the excess of— (I)the taxpayer’s adjusted gross income (or, if greater, earned income) for the taxable year, over (II)the applicable amount, bears to (ii)the applicable denominator. (C)

Applicable amount; applicable denominator

The applicable amount and applicable denominator shall be determined in accordance with the following table: In the case of:The applicable amount is:The applicable denominator is: An eligible individual making a joint return$40,000$40,000 An eligible individual with one or more qualifying children and not making a joint return$30,000$30,000 Any other eligible individual$20,000$20,000

(d)

Definitions and special rules

(1)

Eligible individual

For purposes of this section— (A)

In general

The term eligible individual means, with respect to a taxable year, any individual who— (i)has earned income for such taxable year, and (ii)is not a dependent for whom a deduction is allowable under section 151 to another taxpayer for any taxable year beginning in the same calendar year as such taxable year. (B)

Certain eligible individual rules made applicable

Rules similar to the rules of subparagraphs (B) through (F) of section 32(c)(1) shall apply. (2)

Earned income qualifying child

For purposes of this section, the term earned income shall have the meaning given such term by section 32(c). (3)

Qualifying child

For purposes of this section, the term qualifying child shall have the meaning given such term by section 24. (4)

Married individuals

In the case of an individual who is married (within the meaning of section 7703), this section shall apply only if a joint return is filed for the taxable year under section 6103. (5)

Coordination with Climate Change Rebate Program

(A)

In general

The amount which would be allowed as a credit to a taxpayer under subsection (a) shall, before the application of subsection (c), be reduced (but not below zero) by the amounts received by the taxpayer under the Climate Change Rebate Program under section 4 of the Climate Change Rebate Act of 2008 for months beginning in the taxable year. (B)

Allocation of climate change rebates

For purposes of this subparagraph, in the case of 2 or more eligible individuals who are members of the same household (as defined for purposes of the Climate Change Rebate Program) with respect to which an amount is received under such program for any month, for each such month beginning in the taxable year such an individual shall be treated as receiving an amount equal to— (i)the amount received with respect to such household for such month, divided by (ii)the number of eligible individuals who are members of such household at the beginning of such month. (e)

Senior climate change credit

(1)

In general

In the case of an individual with qualifying retirement income for the taxable year, the taxpayer may elect to apply subsections (c) and (d)(1) by substituting qualifying retirement income for earned income. (2)

Limitation

If the taxpayer makes the election described in paragraph (1) for the taxable year, the amount allowed as a credit under subsection (a) for such taxable year shall not exceed an amount equal to 50 percent of the amount which would (but for this paragraph) be so allowed. (3)

Qualifying income

For purposes of this section, the term qualifying retirement income means— (A)a distribution (other than a rollover) from— (i)a plan described in section 401(a) which includes a trust exempt from tax under section 501(a), (ii)an annuity plan described in section 403(a), (iii)an annuity contract described in section 403(b), (iv)an individual retirement account described in section 408(a), (v)an individual retirement annuity described in section 408(b), (vi)a Roth IRA (as defined in 408A(b)), (vii)an eligible deferred compensation plan (as defined in section 457), (viii)a governmental plan (as defined in section 414(d)), (ix)a trust described in section 501(c)(18), or (x)any other plan, contract, account, annuity, or trust which, at any time, has been determined by the Secretary to be such a plan, contract, account, annuity, or trust, (B)social security benefits (within the meaning of section 86(d)), (C)any compensation or pension received under chapter 11, chapter 13, or chapter 15 of title 38, United States Code, and (D)any other amount received which is in the nature of a retirement benefit payment.

(b)

Conforming amendments

(1)Section 1324(b)(2) of title 31, United States Code, is amended by inserting 37, after 36,. (2)Subparagraph (A) of section 6211(b)(4) of the Internal Revenue Code of 1986 is amended by inserting 37, after 36,. (c)

Clerical amendment

The table of sections for subpart C of part IV of subchapter A of chapter 1 of such Code is amended by striking the item relating to section 37 and inserting the following new items:

Sec. 37. Climate change tax credit.

Sec. 38. Overpayments of tax.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2009.

Climate change rebates for low-income households

(a)

Definitions

For purposes of this section: (1)

Administrator

The term Administrator means the Administrator of the Environmental Protection Agency or, if the President designates an alternative agency under subsection (b)(1), the head of such agency. (2)

Base projected cost increase

The term base projected cost increase means an amount equal to the projected average annual reduction in purchasing power for a 1-person household in the second lowest quintile of the income scale, that results from the regulation of greenhouse gas emissions under any Federal legislation is enacted on or after the date of the enactment of this Act that would limit the emission of greenhouse gasses in connection with the sale of emission allowances, provided that each quintile shall— (A)be based on income adjusted for household size; and (B)have an equal aggregate number of individuals. (3)

Elderly or disabled member

The term elderly or disabled member has the meaning given such term in section 3 of the Food and Nutrition Act of 2008 (7 U.S.C. 2012). (4)

Electronic benefit transfer card

The term electronic benefit transfer card means a card that makes a rebate provided under the Program accessible to a household through an Electronic Benefits Transfer System. (5)

Electronic benefit transfer system

The term Electronic Benefit Transfer System means a system by which rebates provided under the Program are issued from and stored in a central databank by means of electronic benefit transfer cards. (6)

Household

(A)Subject to subparagraph (B), the term household means— (i)an individual who lives alone; or (ii)a group of individuals who live together. (B)For purposes of subparagraph (A)— (i)an individual or a group of individuals who are a household under the Food and Nutrition Act of 2008 (7 U.S.C. 2012) shall be considered a household; (ii)a single individual or married couple who receive benefits under Section 1860D–14 of the Social Security Act (42 U.S.C 1395w–114) shall be considered a household; (iii)notwithstanding Section 4(d)(2) of this Act, the Administrator shall establish rules for providing the Climate Change Rebate in an equitable and administratively simple manner to mixed households where the group of individuals who live together includes a combination of members described in clause (i) and clause (ii), or includes additional members not described in clause (i) or clause (ii). (7)

State

The term State means any of the several States, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, the United States Virgin Islands, Guam, or the Commonwealth of the Northern Mariana Islands. (8)

State agency

The term State agency means— (A)an agency of a State (including the local offices of such agency) that has the responsibility for the administration of federally aided public assistance programs in such State; or (B)in a State in which such programs are operated on a decentralized basis, the corresponding local agencies that administer such programs. (9)

Poverty line

The term poverty line has the meaning given such term in section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)), including any revision required by such section. (b)

Climate change rebate program

(1)

Formulation and administration of program

The Administrator of the Environmental Protection Agency, or the head of such other Executive agency (as defined in section 105 of title 5 of the United States Code) as the President may designate, shall formulate and administer in accordance with this section a program to be known as the Climate Change Rebate Program (in this section referred to as the Program). (2)

State participation in the Program

At the request of a State, eligible households in such State shall be provided an opportunity to receive compensation through the issuance of a rebate in accordance with this section for the reduction in purchasing power resulting from the regulation of greenhouse gas emissions under any Federal legislation described in subsection (a)(2). (c)

Eligibility

Subject to subsection (d), a household shall be eligible to participate in the Program if the State agency designated by the chief executive officer of such State to carry out the Program in such State determines that— (1)such household contains 1 or more individuals who participate in the supplemental nutrition assistance program under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.); (2)such household, without regard to whether such household includes an elderly or disabled member, meets— (A)the gross income standard described in section 5(c)(2) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(c)(2)); and (B)the financial resources limit in effect for the State in which such household is located under section 5(g) the Food and Nutrition Act of 2008 (7 U.S.C. 2014(g)); (3)such household consists of 1 or more individuals who are subsidy eligible individuals (as defined in section 1860D–14 of the Social Security Act (42 U.S.C. 1395w–114)); or (4)such household consists of 1 or more individual who are eligible for benefits under title XVIII of the Social Security Act and who meet the income requirements described in paragraph (1) or (2) of section 1860D–14(a) of such Act and the resource requirements described in subparagraphs (D) and (E) of section 1860D–14(a)(3). (d)

Limitations

The Administrator shall establish procedures to ensure that households do not receive more than 1 rebate per month. (e)

Rebate calculation

(1)

Base projected cost increase

Not later than October 1 of 2009, and of each subsequent calendar year, the Administrator of the Energy Information Administration shall calculate and publish the base projected cost increase for the following year. (2)

Maximum rebate amount

The maximum rebate amount for each month of a calendar year shall be— (A)set by the Administrator; and (B)equal to 1/12 of— (i)100 percent of the base projected cost increase for a household containing 1 individual; (ii)155 percent of the base projected cost increase for a household containing 2 individuals; (iii)180 percent of the base projected cost increase for a household containing 3 individuals; and (iv)200 percent of the base projected cost increase for a household containing 4 or more individuals. (3)

Monthly rebate amounts

Eligible households shall receive a monthly rebate calculated in the following manner: (A)A household with gross income, as determined in the manner provided in section 5 of the Food and Nutrition Act of 2008 (7 U.S.C. 2014), that is not more than 50 percent of the poverty line shall receive the maximum rebate amount for a household of equal size. (B)A household with gross income, as determined in the manner provided in section 5 of the Food and Nutrition Act of 2008 (7 U.S.C. 2014), that is greater than 50 percent of the poverty line and not more than 130 percent of the poverty line shall receive a rebate in an amount determined in accordance with a schedule of phase-down rates based on household size, established by the Administrator and specifying the amount by which the otherwise applicable maximum rebate amount shall be reduced for each dollar by which such gross income exceeds 50 percent of the poverty line. The phase-down rate shall be— (i)for household sizes of 4 or fewer individuals, equal to the maximum rebate amount divided by 80 percent of the poverty line applicable to the particular household size involved; and (ii)for household sizes of 5 or more individuals, equal to a rate determined in accordance with a methodology established by the Administrator. (C)Households with gross income exceeding 130 percent of the poverty line shall not be eligible to receive a rebate under the Program. (4)

Special rule for household with elderly or disabled member

Notwithstanding paragraph (3), households with 1 or more members who are elderly or disabled shall receive the maximum monthly rebate amount for a household of equal size. (f)

Schedule and standards for implementation of program

The Administrator shall establish by rule a schedule and standards to implement the Program. Such standards shall— (1)specify the required level of household protection regarding privacy, ease of rebate use, and access to the rebates under the Program; (2)prohibit the imposition of any fee on a household for the withdrawal or expenditure of any part of such rebates; (3)require States participating in the Program to provide such rebates to recipient households through an Electronic Benefit Transfer System or by direct deposits into accounts established by household members at financial institutions; and (4)provide for the interoperability of the Program among States and among law enforcement authorities that monitor compliance with the Program. (g)

State administration of program

A participating State, and the State agency designated under subsection (b), shall be responsible for— (1)certifying the eligibility of households to receive rebates under the Program; and (2)issuance and control of rebates, and accountability therefor. (h)

Reimbursement of state administrative costs

Subject to standards established by the Administrator, the Administrator shall reimburse each participating State as follows for administrative costs incurred by the designated State agency to carry out the Program: (1)For 3 years such costs shall be reimbursed at the rate of— (A)90 percent of any automated data processing improvement, and Electronic Benefit Transfer contract amendment, necessary to provide rebates under the Program; and (B)75 percent of such costs remaining. (2)For subsequent years such costs shall be reimbursed at the rate of 50 percent. (i)

Treatment of rebates

The amount of any rebate received under the Program shall not be considered to be income or resources for any purpose under any Federal, State, or local law, including any law relating to taxation (including income tax) or public assistance (including programs that provide health care, cash aid, child care, nutrition assistance, and housing assistance). No participating State (or political subdivision thereof) shall decrease any assistance otherwise provided to an individual or a household based on the fact that a household applied for or received a rebate under the Program.

LIHEAP and weatherization

(a)

Deposit of auction receipts

If Federal legislation is enacted that would limit the emission of greenhouse gases in the United States, 1 percent of the total value of emission allowances created by such legislation shall be auctioned each year, and the receipts from that auction shall be deposited in the Treasury for use under subsection (b). (b)

Use of receipts

Of the receipts deposited in the Treasury under subsection (a), 50 percent shall be for the Low-Income Home Energy Assistance Program, and 50 percent shall be for the Weatherization Assistance Program under part A of title IV the Energy Conservation and Production Act (42 U.S.C. 6861 et seq.), to the extent provided in appropriations Acts, to remain available until expended.