This bill amends Washington tax law to support development of low-to-zero carbon alternative jet fuel by changing business and occupation tax treatment and by creating refundable/transferable tax credits and related procedures. It amends RCW 82.04.287 to set a 0.275 percent B&O tax rate for manufacturers of alternative jet fuel (tax base: value of product manufactured), processors for hire of alternative jet fuel (tax base: gross income), and retail or wholesale sellers of manufactured alternative jet fuel (tax base: gross proceeds of sales). The lower tax rate becomes available on the earlier of (a) the first day of the first calendar quarter after the Department of Ecology notifies that Washington in-state facilities have cumulative capacity of at least 20,000,000 gallons per year, or (b) July 1, 2031; qualifying businesses may report under that rate for defined 10-year windows tied to when facilities are “operationally complete.” The amended RCW 82.04.287 section expires July 1, 2051. The bill also amends RCW 82.04.436 to create a per-gallon tax credit for manufacturers/producers of alternative jet fuel and amends RCW 82.16.187 (and creates/changes provisions under RCW 82.04.4361) to provide a per-gallon tax credit for purchasers/users of alternative jet fuel for flights departing in the state. The basic credit is $1.00 per gallon for fuel with at least 50 percent fewer carbon dioxide equivalent emissions than conventional jet fuel, with an increase of $0.02 per gallon for each additional 1 percent reduction beyond 50 percent, up to a $2.00 per gallon maximum. Credits apply only to the portion of fuel that qualifies as “alternative jet fuel,” require a carbon intensity score/certification from the Department of Ecology, are not claimable until the Department of Ecology verifies the 20,000,000 gallon cumulative in-state capacity or until July 1, 2031, and may be claimed for no more than 10 calendar years after the year in which a claimant first claimed a credit. Credits may be used against the relevant chapter tax, may be carried forward only one calendar year, and no refunds are allowed. These credit provisions also expire July 1, 2051. The bill defines “alternative jet fuel” to mean a fuel that can be blended and used with conventional petroleum jet fuel without modifying engines or distribution infrastructure, that has lower lifecycle greenhouse gas emissions than the petroleum fuel it replaces, and that is certified by the Department of Ecology under chapter 70A.535 RCW; it specifically includes jet fuel derived from coprocessed feedstocks at a conventional petroleum refinery as so certified. The Department of Ecology is given verification and notification roles, including carbon intensity certification and notification to trigger tax and credit availability; applicants must file applications and reports electronically, and the administering “department” must approve or deny final applications within 60 days or deny for missing required information. The Department of Archaeology and Historic Preservation is consulted for screening regarding historic cemeteries or tribal burial grounds, with a 60-day deemed verification rule if no determination is made. Some details are incomplete in the provided text. The identity of the repeatedly referenced “the department” that administers tax applications and notifications is not specified here. The amendment text for RCW 82.04.4361 is incomplete in the extracted material, the promised new section is not shown, and the amendment for RCW 82.16.187 appears in part but may not be fully captured. These missing portions could affect eligibility, calculation, or implementation details not visible in the extracted facts.

If enacted, the bill would make in-state production and use of certified low‑carbon alternative jet fuel financially more attractive by cutting the business & occupation tax rate to 0.275% for manufacturers, processors for hire, and sellers of that fuel and by providing per‑gallon tax credits (starting at $1/gal for fuels with ≥50% lifecycle GHG reductions and scaling up to $2/gal for deeper reductions). Those tax benefits only become available once the Department of Ecology verifies at least 20 million gallons/year of in‑state production capacity or by July 1, 2031, and each producer or purchaser can claim credits for only a limited window (generally up to 10 years after first claim), with credits nonrefundable and carryable only one year; the provisions expire July 1, 2051. The businesses most affected are alternative jet fuel producers, processors, blenders, wholesalers/retailers, and purchasers such as airlines flying from Washington: they would likely see improved project economics and lower tax burdens for qualifying fuel but would need to obtain Ecology carbon intensity scores, file electronic applications, meet verification and historic‑land screening requirements, and reflect credit amounts in contract pricing. The state would likely see reduced tax revenue tied to the credits and lower B&O receipts while administration depends on agencies named in the bill; the text does not specify which agency administers the tax/credit filings and some amendment details are missing, so timing, exact application procedures, and certain eligibility rules remain uncertain.