The following information is presented to satisfy the reporting requirements of House Bill 2825, passed into law during the 2011 Legislative Session. House Bill 2825 relates to public access to economic development tax expenditure information.
Strategic Investment Program
The Strategic Investment Program (SIP) exempts a portion of large capital investments from property taxes. The program is available statewide for projects developed by "traded-sector" businesses, most often used for manufacturing firms. "Traded sector" is defined in Oregon law as "industries in which member firms sell their goods or services into markets for which national or international competition exists."
Depending on the investment size, the Strategic Investment Program can offer exceptional benefits in terms of net present value.
Oregon Investment Advantage
This income tax exemption program helps businesses start or locate in most Oregon counties with a multi-year income tax holiday.
Companies setting up operations in an eligible county can be certified at least eight times to annually deduct or subtract taxable income related to those operations, potentially eliminating any state business income tax liability for that period, which begins at least 24 months after the commencement of new operations.
General company eligibility requirements include:
- the creation of at least five new full-time, year-round jobs that receive minimum level of compensation;
- facility operations need to be the first of their kind in Oregon for that company; and
- facility operations cannot compete within the local economy.
Having five or more facility employees is a requirement with each application for annual certification. The uniqueness of operations to the company and other requirements generally pertain only to the time of application for preliminary certification.
Business Energy Tax Credit
(Renewable Resource Equipment Manufacturing (Mfg BETC))
Business owners of facilities used to manufacture equipment, machinery or other products that will be used exclusively for renewable energy resource generation/harvesting may be eligible for a state tax credit. The tax credit is 50% of eligible facility costs. If issued, the tax credit is claimed over five years (10 percent per year) and can be rolled over according to Oregon Revised Statute 315.341(5).
The maximum total cost eligible to receive a preliminary certification from the Director of Business Oregon for tax credits in any calendar year may not exceed:
- $2.5 million in the case of a facility used to manufacture electric vehicles or component parts of electric vehicles ("Component parts of electric vehicles" does not include parts that may be used in both electric and conventional vehicles; or batteries.)
- $40 million, in the case of any other facility.
Application for the tax credit is subject to a detailed technical and financial review of the financial model and plan by a third party. Before the Director will approve a final certification, the department will require the applicant's commitment to performance measures for the facility including job creation and retention requirements and other economic benchmarks through execution of a performance agreement or other similar agreement for the facility. Failure to comply with the terms of the performance agreement or other similar agreement may be the basis for denial or revocation of the final certification. The credit also is subject to clawbacks should performance measures not be met.
The Oregon Governor's Office of Film & Television
Attached is the detailed information required to remain in compliance with House Bill 2825. The following is provided as a brief addendum for a more detailed description of the information.
The Greenlight Oregon Labor Rebate (Greenlight) is designed to recruit film, television and television commercial production to Oregon. In calendar year 2011 the Oregon Film & Video Office recruited over $110,000,000 of film and television production spending in the state as well as an additional $22,000,000 of television commercial spending. Greenlight is an essential tool along with the Oregon Production Investment Fund in recruiting film and TV production and it is also a valuable tool in expanding the TV commercial sector. In order for a producer to qualify for Greenlight, they must meet a set of criteria including:
· Film and TV producers must spend at least $1,000,000 in Oregon on a project.
· TV Commercial producers must spend at least $1,000,000 in Oregon over one calendar year.
· Submit detailed report of Oregon expenses subject to an audit.
Greenlight provides a 6.2% rebate on qualified Oregon labor expenditures. This is currently defined as labor expenditures subject to Oregon withholding taxes.
Business Energy Tax Credit Program
Every effort has been made to ensure the data are complete, but these records reflect information reported to this agency by others. The Oregon Department of Energy is not responsible for data that is misinterpreted or altered in any way.
If errors are discovered after publication of the records, the data are corrected in the electronic files. It is estimated that there is a margin of error of less than one percent.
Notes: This data reports tax credits issued and may differ slightly from the tax credits allowed due to rounding. The tax credit rate depends on the system type and the project completion date. Tax credits for Homebuilder Projects (classified as renewable energy projects) are determined on a case-by-case basis. Other renewable energy projects and High-Efficiency CHP projects completed after 12/31/2006 qualify for a 50% tax credit. Some projects have split types and tax credits. All other projects qualify for a 35% tax credit.
ODOE does not track energy savings/production for all projects including many RD&D, Recycling, Renewable Energy Manufacturing, LEED for "Commercial Interior", and Transportation projects. RD&D projects, in some cases, are subcategories included in other project types.
Agency certification for each taxpayer is based on a number of documents including the Application for Preliminary Certification, technical energy calculations, Application for Final Certification, and Inspection Data Collection. Other information provided by applicants may include maps, business plans, and blueprints. None of these documents are captured in the BETC database.
Additionally, documents provided to the agency for certification determination such as financial statements, customer lists, production, sales and cost data, and marketing information are subject to protection under the Oregon Public Records Law.
For questions regarding the Business Energy Tax Credit Program, please contact: Diana Enright, Oregon Department of Energy.