Bill Text: OR SB246 | 2013 | Regular Session | Enrolled
Bill Title: Relating to the Oregon Industrial Site Readiness Program; appropriating money; and prescribing an effective date.
Spectrum: Committee Bill
Status: (Passed) 2013-08-21 - Effective date, October 7, 2013. [SB246 Detail]
Download: Oregon-2013-SB246-Enrolled.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
Enrolled
Senate Bill 246
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Senate Interim Committee on
Business, Transportation and Economic Development)
CHAPTER ................
AN ACT
Relating to the Oregon Industrial Site Readiness Program;
creating new provisions; amending ORS 285C.635 and 316.502;
appropriating money; limiting expenditures; and prescribing an
effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + The Legislative Assembly finds that:
(1) Traded sector industries are the foundation of state and
regional economic development strategies for long-term prosperity
and job creation.
(2) Industrial development that provides new traded sector jobs
reinforces the economies of local and regional communities and
contributes to the economic recovery of the State of Oregon.
(3) There is a shortage of market-ready regional industrial
sites in this state. Project sponsors have limited financial
tools to facilitate development of significant and complex
industrial sites that are appropriate for traded sector
industrial use.
(4) Public assistance is necessary to overcome
development-related constraints and to incentivize industrial
site development in this state.
(5) The State of Oregon has a significant interest in the
success of regional economic development strategies and is the
primary beneficiary from increased income tax revenues generated
by such economic development. These revenues should be shared and
invested in facilitating significant site development for traded
sector industrial use in this state. + }
SECTION 2. { + As used in sections 1 to 5 of this 2013 Act:
(1) 'Compensation' has the meaning given that term pursuant to
rules adopted by the Oregon Business Development Department.
(2) 'Eligible employer' means an employer that:
(a) Has entered into a contract with a project sponsor to
conduct a business in the traded sector industry on a regionally
significant industrial site; and
(b) Has hired full-time employees who are residents of this
state and whose compensation averages at least 150 percent of the
county or state average wage, whichever is less.
(3) 'Estimated incremental income tax revenues' means the
Oregon personal income tax revenues that are estimated pursuant
Enrolled Senate Bill 246 (SB 246-B) Page 1
to section 4 of this 2013 Act to be substantially equivalent to
the amount of tax that employees of an eligible employer who are
hired after the eligible employer enters into a contract with a
qualified project sponsor to conduct a traded sector business on
a certified regionally significant industrial site will be
required to pay under ORS chapter 316 as a result of compensation
paid to the employees by the eligible employer in the tax years
beginning with the tax year following the fifth tax year in which
a project sponsor was qualified under section 3 of this 2013 Act.
(4) 'Industrial use' means employment activities, including but
not limited to manufacturing, assembly, fabrication, processing,
storage, logistics, warehousing, importation, distribution,
transshipment and research and development, that generate income
from the production, handling or distribution of goods or
services, including goods or services in the traded sector.
(5) 'Project sponsor' means:
(a) A public owner of a regionally significant industrial site
that is investing in preparation of the site for industrial use
by a third party; or
(b) A public entity that has entered into a development or
other agreement with the private owner of a regionally
significant industrial site to prepare the site for industrial
use.
(6) 'Regionally significant industrial site' means an area
planned and zoned for industrial use that:
(a)(A) Contains a site or sites, including brownfields, that
are suitable for the location of new industrial uses or the
expansion of existing industrial uses and that can provide
significant additional employment in the region;
(B) Has site characteristics that give the area significant
competitive advantages that are difficult or impossible to
replicate in the region; and
(C) Has superior access to transportation and freight
infrastructure, including but not limited to rail, port, airport,
multimodal freight or transshipment facilities and other major
transportation facilities or routes; or
(b) Is land designated by Metro, as defined in ORS 197.015, as
a regionally significant industrial area.
(7) 'Traded sector' has the meaning given that term in ORS
285A.010.
(8) 'Wage' has the meaning given that term pursuant to rules
adopted by the Oregon Business Development Department. + }
SECTION 3. { + (1) In consultation with the Department of
Revenue, the Oregon Business Development Department shall
establish and administer the Oregon Industrial Site Readiness
Program. The purpose of the program is to:
(a) Enter into tax reimbursement arrangements with qualified
project sponsors pursuant to subsection (5) of this section; or
(b) Provide loans, including forgivable loans, to qualified
project sponsors pursuant to subsection (5) of this section.
(2)(a) Subject to standards and procedures that the Oregon
Business Development Department shall establish by rule, the
department shall certify regionally significant industrial sites
for inclusion in the program.
(b) A regionally significant industrial site certified under
this section must be an industrial site that is planned and zoned
for industrial use.
(3) A project sponsor may apply to participate in the program
by submitting an application and development plan in writing in a
form prescribed by the department by rule.
Enrolled Senate Bill 246 (SB 246-B) Page 2
(4) The department shall establish by rule criteria and
standards for the qualification of project sponsors to
participate in the program.
(5) Upon qualification of a project sponsor under this section,
and before July 1, 2023, the department may:
(a) Enter into a tax reimbursement arrangement with the project
sponsor pursuant to which the project sponsor shall receive an
amount equal to 50 percent of the estimated incremental income
tax revenues generated by an eligible employer per tax year,
beginning with the tax year following the fifth tax year in which
a project sponsor is qualified under this section, until the
total investment of the qualified project sponsor in the eligible
site preparation costs, including interest, established under
subsection (7) of this section has been recovered, at which time
the tax reimbursement arrangement shall end; or
(b) Enter into a loan agreement with the project sponsor under
terms and conditions specified and required by the department. In
making a determination to enter into a loan agreement with the
project sponsor, the department shall consider the reasonableness
of the project sponsor's estimated costs to prepare the site for
industrial use, including but not limited to eligible site
preparation costs established by the department pursuant to
subsection (7) of this section. The agreement may specify that a
portion of the loan may be forgiven if the project sponsor enters
into a contract with an eligible employer to conduct a business
in the traded sector industry on a regionally significant
industrial site within seven years after the project sponsor was
qualified under this section.
(6)(a) The total amount of the loan that may be forgiven under
subsection (5) of this section is the lesser of:
(A) Fifty percent of the total cost of eligible site
preparation costs; or
(B) Fifty percent of the amount of the estimated incremental
income tax revenues for the eligible employer for the term of the
loan.
(b) Loan forgiveness may not be allowed under subsection (5) of
this section if any portion of the loan that would not be
forgiven would be repaid by the project sponsor with state funds
received from any source.
(7) The department shall establish, by rule, eligible site
preparation costs including, but not limited to, some or all of
the following:
(a) Acquisition and assembly costs associated with creating
large development parcels.
(b) Transportation improvements such as access roads,
intersections, turning lanes, signals, sidewalks, curbs, transit
stops and storm drains.
(c) Water and sewer infrastructure.
(d) Natural resource mitigation.
(e) Site grading activities.
(f) Environmental remediation and mitigation activities to
address brownfields issues in accordance with state and federally
approved remediation plans.
(g) Planning, engineering and administrative costs associated
with applying for necessary local, state and federal permits.
(h) Interest-carrying costs incurred by a project sponsor for
amounts borrowed to develop a regionally significant industrial
site, not to exceed 20 percent of the total amount forgiven, if
any, under subsection (5) of this section.
Enrolled Senate Bill 246 (SB 246-B) Page 3
(8) The total amount of tax reimbursement arrangements and loan
amounts authorized under this section may not exceed $10 million
per year.
(9) Funds received pursuant to a tax reimbursement arrangement
or a loan agreement under subsection (5) of this section may not
be used for the payment of:
(a) A penalty or fine; or
(b) Environmental remediation activities conducted at a
regionally significant industrial site that is listed or proposed
to be listed as a national priority pursuant to the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980
(42 U.S.C. 9605) for which the project sponsor, eligible employer
or any party to the tax reimbursement arrangement or loan
agreement is liable under 42 U.S.C. 9607 at that regionally
significant industrial site.
(10) The department shall adopt rules to administer and
implement the provisions of this section including, but not
limited to, the development of performance measures for eligible
employers regarding job creation and compensation under section 2
(2)(b) of this 2013 Act. + }
SECTION 4. { + (1) Beginning with the tax year following the
fifth tax year in which a project sponsor was qualified under
section 3 of this 2013 Act, on or before April 1 following each
tax year in which employees of an eligible employer will be
required to pay personal income taxes under ORS chapter 316, the
eligible employer and the project sponsor with which the eligible
employer has entered into a contract under sections 1 to 5 of
this 2013 Act shall submit a report to the Oregon Business
Development Department, in addition to any other reporting or
filing requirement, that contains the annual amount of taxable
income and total compensation paid to employees of the eligible
employer and any other information that may be required by the
Oregon Business Development Department and the Oregon Department
of Administrative Services under this section.
(2) Upon receipt of information compiled under subsection (1)
of this section, the Oregon Department of Administrative Services
shall determine the annual amount of estimated incremental income
tax revenues generated by an eligible employer per tax year,
beginning with the tax year following the fifth tax year in which
a project sponsor was qualified under section 3 of this 2013 Act.
(3) In determining the amount of estimated incremental income
tax revenues generated by an eligible employer under this
section, the Oregon Department of Administrative Services may
rely on reasonable techniques of estimation, if appropriate.
(4) Not later than May 15 of each fiscal year, the Oregon
Department of Administrative Services shall certify the amounts
determined under subsection (2) of this section to the Department
of Revenue, the Legislative Revenue Officer and the Legislative
Fiscal Officer.
(5) Not later than June 15 of each fiscal year, after receiving
the certification under subsection (4) of this section, the
Department of Revenue shall transfer to the Oregon Industrial
Site Readiness Program Fund established in section 5 of this 2013
Act an amount equal to 50 percent of the amount of estimated
incremental income tax revenues certified under subsection (4) of
this section.
(6) The Department of Revenue shall retain unreceipted revenue
from the tax imposed under ORS chapter 316 in an amount necessary
to make the transfers required under subsection (5) of this
section. The department shall make the transfers out of the
Enrolled Senate Bill 246 (SB 246-B) Page 4
unreceipted revenue in lieu of paying the revenue over to the
State Treasurer for deposit in the General Fund.
(7) The Oregon Business Development Department and the Oregon
Department of Administrative Services shall adopt rules necessary
to administer this section. The Department of Revenue may adopt
rules necessary to administer this section. + }
SECTION 5. { + The Oregon Industrial Site Readiness Program
Fund is established in the State Treasury, separate and distinct
from the General Fund. The Oregon Industrial Site Readiness
Program Fund consists of amounts deposited in the fund and other
moneys transferred to the fund, including but not limited to
moneys transferred by the Department of Revenue to the fund under
section 4 of this 2013 Act. Amounts in the fund are continuously
appropriated to the Oregon Business Development Department for
the purposes of entering into tax reimbursement arrangements and
making loans under section 3 of this 2013 Act and paying the
costs and expenses of the Oregon Business Development Department
in connection with the implementation and administration of
sections 1 to 5 of this 2013 Act. + }
SECTION 6. ORS 285C.635 is amended to read:
285C.635. (1) Upon receipt of information compiled under ORS
285C.615, the Oregon Department of Administrative Services shall
determine the annual amount of personal income tax revenue
attributable to each eligible project for which an eligible
business firm received a property tax exemption under ORS
307.123. { + The amount of personal income tax revenue
attributable to each eligible project under this subsection may
not include personal income tax revenue attributable to the
estimated incremental income tax revenues generated by an
eligible employer in connection with a tax reimbursement
arrangement or loan agreement that has been entered into under
the Oregon Industrial Site Readiness Program established by
section 3 of this 2013 Act. + }
(2) In determining the amount of personal income tax revenue
attributable to each eligible project, the department may rely on
reasonable techniques of estimation, if appropriate.
(3) In each fiscal year, the department shall transfer 50
percent of the cumulative amount for all eligible projects
determined under subsection (1) of this section to the Shared
Services Fund established in ORS 285C.639.
(4) The department shall adopt rules necessary to administer
this section.
SECTION 7. ORS 316.502 is amended to read:
316.502. (1) The net revenue from the tax imposed by this
chapter, after deducting refunds { + and amounts described in
section 4 of this 2013 Act + }, shall be paid over to the State
Treasurer and held in the General Fund as miscellaneous receipts
available generally to meet any expense or obligation of the
State of Oregon lawfully incurred.
(2) A working balance of unreceipted revenue from the tax
imposed by this chapter may be retained for the payment of
refunds, but such working balance shall not at the close of any
fiscal year exceed the sum of $1 million.
(3) Moneys are continuously appropriated to the Department of
Revenue to make:
(a) The refunds authorized under subsection (2) of this
section; and
(b) The refund payments in excess of tax liability authorized
under ORS 315.262 and 315.266 and section 17, chapter 906, Oregon
Laws 2007.
Enrolled Senate Bill 246 (SB 246-B) Page 5
SECTION 8. { + Notwithstanding any other law limiting
expenditures, the limitation on expenditures established by
section 3 (1), chapter ___, Oregon Laws 2013 (Enrolled House Bill
5028), for the biennium beginning July 1, 2013, as the maximum
limit for payment of expenses from lottery moneys allocated from
the Administrative Services Economic Development Fund to the
Oregon Business Development Department, is increased by $179,254
for the Oregon Industrial Site Readiness Program. + }
SECTION 9. { + The Oregon Business Development Department
shall report on the Oregon Industrial Site Readiness Program to
the committees of the Seventy-eighth Legislative Assembly with
authority over the subject area of economic development during
the 2015 regular session. + }
SECTION 10. { + 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. + }
----------
Passed by Senate July 3, 2013
.............................................................
Robert Taylor, Secretary of Senate
.............................................................
Peter Courtney, President of Senate
Passed by House July 6, 2013
.............................................................
Tina Kotek, Speaker of House
Enrolled Senate Bill 246 (SB 246-B) Page 6
Received by Governor:
......M.,............., 2013
Approved:
......M.,............., 2013
.............................................................
John Kitzhaber, Governor
Filed in Office of Secretary of State:
......M.,............., 2013
.............................................................
Kate Brown, Secretary of State
Enrolled Senate Bill 246 (SB 246-B) Page 7
