Bill Text: OR HB2894 | 2013 | Regular Session | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to energy incentive programs; prescribing an effective date.

Spectrum: Committee Bill

Status: (Failed) 2013-07-08 - In committee upon adjournment. [HB2894 Detail]

Download: Oregon-2013-HB2894-Engrossed.html

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     77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 3211

                           A-Engrossed

                         House Bill 2894
                  Ordered by the House April 2
            Including House Amendments dated April 2

Sponsored by COMMITTEE ON ENERGY AND ENVIRONMENT

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.

  For purposes of tax credits for energy conservation projects,
increases amount of eligible cost for which credit may be claimed
using informational filing system in place of certification and
for which entire credit may be claimed in first allowable tax
year.
  Allows entire tax credit for transportation project to be
claimed in first allowable tax year.
    { - Directs State Treasurer to establish terms for transfer
of tax credits. Allows State Treasurer to consider discount rates
of other transferable tax credits in establishing terms for
transfers. - }
   { +  For purposes of tax credits for facilities using or
producing renewable energy resources having certified cost in
excess of $10 million, exempts research, development and
demonstration facilities from provision that credit may first be
claimed in tax year following final certification. + }
  Applies to tax years beginning on or after January 1, 2014.
  Includes   { - replacement  - }   { + acquisition + } of
alternative fuel vehicle fleet in definition of transportation
project for which tax credit may be claimed. Applies to tax years
beginning on or after January 1, 2015.
  Takes effect on 91st day following adjournment sine die.

                        A BILL FOR AN ACT
Relating to energy incentive programs; creating new provisions;
  amending ORS 315.331, 315.336, 469B.167, 469B.285, 469B.320 and
  469B.344; and prescribing an effective date.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 315.331 is amended to read:
  315.331. (1) A credit is allowed against the taxes otherwise
due under ORS chapter 316 or, if the taxpayer is a corporation,
under ORS chapter 317 or 318, for an energy conservation project
that is certified under ORS 469B.270 to 469B.306. The credit is
allowed as follows:
  (a) Except as provided in paragraph (b) of this subsection, the
credit allowed in each of the first two tax years in which the
credit is claimed shall be 10 percent of the certified cost of
the facility, but may not exceed the tax liability of the
taxpayer.  The credit allowed in each of the succeeding three
years shall be five percent of the certified cost, but may not
exceed the tax liability of the taxpayer.
  (b) If the certified cost of the facility does not exceed
  { - $20,000 - }   { + $50,000 + }, the total amount of the
credit allowable under subsection (3) of this section may be
claimed in the first tax year for which the credit may be
claimed, but may not exceed the tax liability of the taxpayer.
  (2) In order for a tax credit to be allowable under this
section:
  (a) The project must be located in Oregon.
  (b) The project must have received final certification from the
Director of the State Department of Energy under ORS 469B.270 to
469B.306.
  (c) If the project is a research and development project, it
must receive, prior to certification under ORS 469B.288, a
recommendation from a qualified third party selected by the
director.
  (d) If the project is new construction or a total building
retrofit, then the project must achieve, at a minimum, the energy
efficiency standards required for:
  (A) LEED Platinum certification;
  (B) A four globes rating from the Green Globes program;
  (C) A nationally or regionally recognized and appropriate
sustainable building program whose performance standards are
equivalent to the standards required for LEED Platinum
certification or a four globes rating from the Green Globes
program, as determined by the department; or
  (D) Verification that the construction conformed to the
standards of the Reach Code adopted pursuant to ORS 455.500.
  (3) The total amount of credit allowable to an eligible
taxpayer under this section may not exceed 35 percent of the
certified cost of the project.
  (4)(a) Upon any sale, termination of the lease or contract,
exchange or other disposition of the project, notice thereof
shall be given to the director, who shall revoke the certificate
covering the project as of the date of such disposition.
  (b) A new owner, or, upon re-leasing of the project, a new
lessee, may apply for a new certificate under ORS 469B.291. The
new lessee or owner must meet the requirements of ORS 469B.270 to
469B.306 and may claim a tax credit under this section only if
all moneys owed by the new owner or lessee to the State of Oregon
have been paid, if the project continues to operate and if all
conditions in the final certification are met. The tax credit
available to the new owner shall be limited to the amount of
credit not claimed by the former owner or, for a new lessee, the
amount of credit not claimed by the lessee under all previous
leases. The State Department of Energy may waive the requirement
that a new owner or lessee apply for a new certificate under ORS
469B.291 if the remaining credit is less than $20,000.
  (c) The department may not revoke the certificate covering a
project under paragraph (a) of this subsection if the tax credit
associated with the project has been transferred to a taxpayer
who is an eligible applicant under ORS 469B.285.
  (5) The tax credit allowed under this section for any one tax
year may not exceed the tax liability of the taxpayer.
  (6) Any tax credit otherwise allowable under this section that
is not used by the taxpayer in a particular year may be carried
forward and offset against the taxpayer's tax liability for the
next succeeding tax year. Any credit remaining unused in that
next succeeding tax year may be carried forward and used in the
second succeeding tax year, and likewise, any credit not used in
that second succeeding tax year may be carried forward and used
in the third succeeding tax year, and likewise, any credit not
used in that third succeeding tax year may be carried forward and
used in the fourth succeeding tax year, and likewise, any credit
not used in that fourth succeeding tax year may be carried
forward and used in the fifth succeeding tax year, but may not be
carried forward for any tax year thereafter. Credits may be
carried forward to and used in a tax year beyond the years
specified in subsection (1) of this section only as provided in
this subsection.
  (7) The credit allowed under this section is not in lieu of any
depreciation or amortization deduction for the project to which
the taxpayer otherwise may be entitled for purposes of ORS
chapter 316, 317 or 318 for such year.
  (8) The taxpayer's adjusted basis for determining gain or loss
may not be decreased by any tax credits allowed under this
section.
  (9) The definitions in ORS 469B.270 apply to this section.
  SECTION 2. ORS 469B.285, as amended by section 21, chapter 45,
Oregon Laws 2012, is amended to read:
  469B.285. (1) Prior to the installation or construction of an
energy conservation project, any person may apply to the State
Department of Energy for preliminary certification under ORS
469B.288 if:
  (a) The project complies with the standards adopted by the
Director of the State Department of Energy; and
  (b) The applicant will be the owner, contract purchaser or
lessee of the project at the time of installation or construction
of the project.
  (2) An application for preliminary certification shall be made
in writing on a form prepared by the department and shall
contain:
  (a) A statement that the applicant plans to acquire, construct
or install a project that substantially reduces the consumption
of purchased energy or uses energy more efficiently.
  (b) A detailed description of the project and its operation and
information showing that the project will operate as represented
in the application and remain in operation for at least five
years, unless the director by rule specifies another period of
operation.
  (c) Information on the amount by which consumption of purchased
energy by the applicant will be reduced, and, if applicable,
information about the expected level of sustainable building
practices project performance.
  (d) The anticipated total project cost.
  (e) Information on the number and type of jobs, directly
connected to the allowance of the credit, that will be:
  (A) Created by the project; and
  (B) Sustained throughout the construction, installation and
operation of the project.
  (f) Information demonstrating that the project will comply with
applicable state and local laws and regulations and obtain
required licenses and permits.
  (g) Information relating to the standards described in ORS
469B.279.
  (h) A recommendation for a research and development project as
demonstrative of innovation that has been made by a qualified
third party selected by the director.
  (i) Any other information the director considers necessary to
determine whether the project is in accordance with the
provisions of ORS 469B.270 to 469B.306, and any applicable rules
or standards adopted by the director.
  (3) An application for preliminary certification shall be
accompanied by a fee established under ORS 469B.294. The director
may refund all or a portion of the fee if the application for
certification is rejected.
  (4) The director may allow an applicant to file the application
for preliminary certification after the start of installation or
construction of the project if the director finds that:

  (a) Filing the application before the start of installation or
construction is inappropriate because special circumstances
render filing earlier unreasonable; and
  (b) The project would otherwise qualify for certification under
ORS 469B.270 to 469B.306.
  (5) The director may, by rule, waive preliminary certification
under ORS 469B.288, or may establish an informational filing
system in place of preliminary certification, for projects that:
  (a) Have eligible costs of less than   { - $20,000 - }
 { + $50,000 + };
  (b) Consist of measures that the director determines to be
eligible for waiver of preliminary certification; and
  (c) Comply with any other requirements established by the
director.
  (6) A preliminary certification shall remain valid for a period
of three calendar years after the date on which the preliminary
certification is issued by the director, after which the
certification becomes invalid even if:
  (a) The applicant is awaiting identification of a pass-through
partner; or
  (b) The preliminary certification has been amended.
  SECTION 3. ORS 315.336, as amended by section 6, chapter 45,
Oregon Laws 2012, is amended to read:
  315.336. (1) A credit is allowed against the taxes otherwise
due under ORS chapter 316 or, if the taxpayer is a corporation,
under ORS chapter 317 or 318, for a transportation project, based
upon the certified cost of the project during the period for
which the project is certified under ORS 469B.320 to 469B.347.
  (2) The credit allowed for a project other than an alternative
fuel vehicle   { - infrastructure - }  project shall be as
follows:
  (a) For tax years beginning on or after January 1, 2011, and
before January 1, 2012, the maximum allowed credit shall be:
  (A) 35 percent of certified cost, if a preliminary
certification is issued under ORS 469B.329 prior to July 1, 2011;
or
  (B) 25 percent of certified cost, if a preliminary
certification is issued under ORS 469B.329 on or after July 1,
2011, and before January 1, 2012.
  (b) For tax years beginning on or after January 1, 2012, and
before January 1, 2013, the maximum allowed credit shall be 25
percent of certified cost.
  (c) For tax years beginning on or after January 1, 2013, and
before January 1, 2014, the maximum allowed credit shall be 20
percent of certified cost.
  (d) For tax years beginning on or after January 1, 2014, and
before January 1, 2015, the maximum allowed credit shall be 15
percent of certified cost.
  (e) For tax years beginning on or after January 1, 2015, and
before January 1, 2016, the maximum allowed credit shall be 10
percent of certified cost.
  (3) The total amount of the credit allowable for an alternative
fuel vehicle   { - infrastructure - }  project under this section
may not exceed 35 percent of the certified cost of the project.
  (4)  { - (a) Except as provided in paragraph (b) of this
subsection, the credit allowed in each of the first two tax years
in which the credit is claimed shall be 10 percent of the
certified cost of the project, but may not exceed the tax
liability of the taxpayer. The credit allowed in each of the
succeeding three years shall be five percent of the certified
cost, but may not exceed the tax liability of the taxpayer. - }
    { - (b) If the amount of the credit allowed under this
section is less than 35 percent of the certified cost of the
project, the credit allowed in any tax year may not exceed five
percent of the certified cost of the project, and - }   { + The
total amount of the credit allowable under this section may be
claimed in the first tax year for which the credit may be
claimed, but + } may not exceed the tax liability of the
taxpayer.
  (5) In order for a tax credit to be allowable under this
section:
  (a) The project must be located in Oregon.
  (b) The project must have received final certification from the
Director of the State Department of Energy under ORS 469B.320 to
469B.347.
  (6) Any tax credit otherwise allowable under this section that
is not used by the taxpayer in a particular year may be carried
forward and offset against the taxpayer's tax liability for the
next succeeding tax year. Any credit remaining unused in that
next succeeding tax year may be carried forward and used in the
second succeeding tax year, and likewise, any credit not used in
that second succeeding tax year may be carried forward and used
in the third succeeding tax year, and likewise, any credit not
used in that third succeeding tax year may be carried forward and
used in the fourth succeeding tax year, and likewise, any credit
not used in that fourth succeeding tax year may be carried
forward and used in the fifth succeeding tax year, but may not be
carried forward for any tax year thereafter. Credits may be
carried forward to and used in a tax year beyond the years
specified in subsection (2) of this section only as provided in
this subsection.
  (7) The credit allowed under this section is not in lieu of any
depreciation or amortization deduction for the transportation
project to which the taxpayer otherwise may be entitled for
purposes of ORS chapter 316, 317 or 318 for such year.
  (8) The taxpayer's adjusted basis for determining gain or loss
may not be decreased by any tax credits allowed under this
section.
  (9) The definitions in ORS 469B.320 apply to this section.
  SECTION 4. ORS 469B.167 is amended to read:
  469B.167. (1)(a) A certificate issued under ORS 469B.161 is
required for purposes of obtaining tax credits in accordance with
ORS 315.354. Such certification shall be granted for a period not
to exceed five years. The five-year period shall begin with the
tax year of the applicant during which the completed application
for final certification of the facility under ORS 469B.161 is
received by the State Department of Energy.
  (b) For a transferee holding a credit that has been transferred
under ORS 469B.148 or 469B.154, the five-year period shall begin
with the tax year in which the transferee pays for the credit.
  (2) Notwithstanding subsection (1) of this section, for a
facility using or producing renewable energy resources { + ,
other than a research, development or demonstration facility, + }
with a certified cost that exceeds $10 million and that receives
final certification under ORS 469B.161 after January 1, 2010:
  (a) The five-year period prescribed in subsection (1)(a) of
this section shall begin with the tax year immediately following
the tax year during which the completed application for final
certification of the facility under ORS 469B.161 is received by
the department.
  (b) If claimed by a transferee, the first of five tax years in
which the transferee may claim the credit is the tax year in
which the transferee paid for the credit or the tax year
prescribed in paragraph (a) of this subsection, whichever is
later.
  (c) An application shall be considered complete without the
identification of a transferee for purposes of ORS 469B.148 or
469B.154.
  (3) If the original owner of the certificate uses any portion
of the credit, the certificate becomes nontransferable.
  SECTION 5. ORS 469B.344, as amended by section 10, chapter 45,
Oregon Laws 2012, is amended to read:
  469B.344. (1)(a) The total amount of potential tax credits for
all transportation projects in this state may not, at the time of
preliminary certification under ORS 469B.329, exceed $20 million
for any biennium.
  (b) For each tax year, the Director of the State Department of
Energy may allocate a percentage of the amount allowed in
paragraph (a) of this subsection to alternative fuel vehicle
  { - infrastructure - }  projects and a percentage to transit
services.
  (2) Notwithstanding ORS 315.336, in the event that the director
receives applications for preliminary certification with a total
amount of potential tax credits in excess of the limits set by
the director pursuant to subsection (1)(b) of this section, the
director shall allocate the issuance of preliminary
certifications among applicants as follows:
  (a) If an excess of applications for credits for transit
services is received, the director shall allocate the issuance of
preliminary certifications among applicants for credits for
transit services and proportionately reduce the amount of allowed
credit, with no applicant receiving more than 20 percent of the
amount established under subsection (1)(b) of this section for
transit services.
  (b) The director may allocate the issuance of preliminary
certifications among applicants for credits for alternative fuel
vehicle   { - infrastructure - }  projects and may award credits
for less than the amount otherwise allowed applicants.
  (c) If, after making any reductions required under paragraph
(a) of this subsection, an unallocated amount remains, the
director shall allocate this additional amount among applicants
affected by the percentage restriction in paragraph (a) of this
subsection.
  SECTION 6. ORS 469B.320, as amended by section 7, chapter 45,
Oregon Laws 2012, is amended to read:
  469B.320. As used in ORS 315.336 and 469B.320 to 469B.347:
   { +  (1) 'Acquisition of an alternative fuel vehicle fleet '
includes the replacement of two or more vehicles that are not
used primarily for personal, family or household purposes, that
are modified or acquired directly from the factory and that:
  (a) Use an alternative fuel, including electricity, biofuel,
gasohol with at least 20 percent denatured alcohol content,
hydrogen, Hythane, methane, methanol, natural gas, propane or any
other fuel approved by the Director of the State Department of
Energy as an alternative fuel; and
  (b) Produce lower exhaust emissions, or are more energy
efficient, than equivalent vehicles fueled by gasoline or
diesel. + }
    { - (1) - }   { + (2) + } 'Alternative fuel vehicle
infrastructure project ' includes a facility for mixing, storing,
compressing or dispensing fuels for alternative fuel vehicles,
and any other necessary and reasonable equipment.
   { +  (3) 'Alternative fuel vehicle project' means:
  (a) The acquisition of an alternative fuel vehicle fleet; or
  (b) An alternative fuel vehicle infrastructure project. + }
    { - (2) - }   { + (4) + } 'Cost' includes capital
expenditures and core expenses such as vehicle repair, fuel,
personnel and administrative expenses.
    { - (3) - }   { + (5) + } 'Transportation project' means:
  (a) Transit services provided to members of the public by a
public or nonprofit entity that receives state or federal funding
for those services, or is the direct recipient of funding from an
entity that receives state or federal funding for the services;
or
  (b) An alternative fuel vehicle   { - infrastructure - }
project.

  SECTION 7.  { + (1) The amendments to ORS 315.331, 315.336,
469B.167, 469B.285 and 469B.344 by sections 1 to 5 of this 2013
Act apply to tax years beginning on or after January 1, 2014.
  (2) The amendments to ORS 469B.320 by section 6 of this 2013
Act apply to tax years beginning on or after January 1, 2015. + }
  SECTION 8.  { + This 2013 Act takes effect on the 91st day
after the date on which the 2013 regular session of the
Seventy-seventh Legislative Assembly adjourns sine die. + }
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