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for a specified period of years. The contracts required the
taxpayer to build “a new conventional steam plant” with a
capability of “approximately 560 megawatts”, and the taxpayer was
required to “operate and maintain” the plant “in an economical
and efficient manner and in accordance with good utility practice
and all applicable law”. Id. at 12. In 1990 and 1991, the
taxpayer made several repairs and improvements to the plant and
sought the investment tax credit under the transition rules for
supply and service contracts provided for in section 204(a)(3) of
TRA 1986. The Court of Appeals for the First Circuit stated that
the conference report was helpful because “the requirement that
the specifications and amount of the property be readily
ascertainable indicates that the inquiry need be specific,
although not exact.” Id. at 16. The Court of Appeals held that
the taxpayer was not entitled to the investment tax credit under
the transition rules for the cost of repairs and improvements
made to its plant because the contracts did not contain the
amount or specifications of potential replacement parts, and
there was no contractual obligation for the taxpayer to replace
parts on a specific schedule. Id.
We conclude that the operating license and amendments
thereto in this case are not related documents to the power
contracts. Here, the operating license and amendments and
appendices thereto were not incorporated by reference into the
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