2017 ORS 315.331¹
Energy conservation projects

(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 (Definitions for ORS 315.331 and 469B.270 to 469B.306) to 469B.306 (Policies and procedures). The credit is allowed as follows:

(a) Except as provided in ORS 469B.298 (Recertification of eligibility) and 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, 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 (Definitions for ORS 315.331 and 469B.270 to 469B.306) to 469B.306 (Policies and procedures).

(c) If the project is a research and development project, it must receive, prior to certification under ORS 469B.288 (Submissions for preliminary certification), 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 (Reach Code).

(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 (Final certification). The new lessee or owner must meet the requirements of ORS 469B.270 (Definitions for ORS 315.331 and 469B.270 to 469B.306) to 469B.306 (Policies and procedures) 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 (Final certification) 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 (Application for preliminary certification).

(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 (Definitions for ORS 315.331 and 469B.270 to 469B.306) apply to this section. [2011 c.730 §35; 2015 c.545 §3]

Note: Section 9, chapter 545, Oregon Laws 2015, provides:

Sec. 9. Section 2 of this 2015 Act [469B.298 (Recertification of eligibility)] and the amendments to ORS 315.331 (Energy conservation projects), 469B.276 (Transferability of project tax credit), 469B.291 (Final certification), 469B.294 (Fees for certification or recertification), 469B.297 (Certificate required for tax credits) and 469B.300 (Revocation of certificate) by sections 3 to 8 of this 2015 Act apply to applications for final certification under ORS 469B.291 (Final certification) submitted on or after September 1, 2015, and to tax years beginning on or after January 1, 2015. [2015 c.545 §9]

Note: Sections 36 and 51, chapter 730, Oregon Laws 2011, provide:

Sec. 36. (1) A taxpayer may not be allowed a credit under section 35 of this 2011 Act [315.331 (Energy conservation projects)] if the first tax year for which the credit would otherwise be allowed, with respect to an energy conservation project certified under section 45 of this 2011 Act [469B.291 (Final certification)], begins on or after January 1, 2018.

(2) A taxpayer may not be allowed a credit for an energy conservation project that is a cogeneration facility as that term is defined in ORS 758.505 (Definitions for ORS 758.505 to 758.555) for a tax year that begins before January 1, 2013. [2011 c.730 §36]

Sec. 51. Sections 35 [315.331 (Energy conservation projects)], 36 and 38 to 50 [469B.270 (Definitions for ORS 315.331 and 469B.270 to 469B.306) to 469B.306 (Policies and procedures)] of this 2011 Act apply to applications for preliminary certification submitted under section 43 of this 2011 Act [469B.285 (Application for preliminary certification)] after July 1, 2011, and to tax years beginning on or after January 1, 2011. [2011 c.730 §51]

Chapter 315

Notes of Decisions

State could not recalculate tax for tax year closed to review in order to prevent elective carry forward of tax credit to tax year subject to review. Smurfit Newsprint Corp. v. Dept. of Revenue, 329 Or 591, 997 P2d 185 (2000)

1 Legislative Counsel Committee, CHAPTER 315—Personal and Corporate Income or Excise Tax Credits, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors315.­html (2017) (last ac­cessed Mar. 30, 2018).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 315, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano315.­html (2017) (last ac­cessed Mar. 30, 2018).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.