Oregon last year authorized $336 million in “pre-certified” tax giveaways under the state’s Business Energy Tax Credit (BETC) program. Rep. Matt Wingard (R-Wilsonville) said the Legislature should examine why the tax credits were allowed to spiral out of control, and he called on his colleagues to once again pass a bill to contain the program’s escalating costs.
“The BETC program is an example of poor government planning, and one of the major reasons why politicians are asking for more money out of cash-strapped Oregon businesses and individuals,” said Rep. Wingard, who supported 2009 legislation to reduce the tax credit. “Oregonians should be outraged the Governor low-balled the program’s costs, vetoed legislation to reduce the tax credit, and then signed $733 million in income and corporate tax increases.”
The 2007 Legislature increased the tax credit for renewable energy systems installed by businesses from 35 percent to 50 percent and increased the project cost limit from $10 million to $20 million– leading to an ever increasing amount of applications filed to receive the generous tax credit. Investigative reporting found that the Governor’s office deliberately underestimated the program’s costs to win legislative approval of the expansion. Millions in tax credits have since been awarded for “˜green’ projects that may never be completed.
“Despite the controversy, there has not been much discussion on the amount of applications in 2009 that were pre-certified to receive a tax credit,” Rep. Wingard said. “The data on 2009 pre-certified tax credits demonstrates the volatile growth of the program and the potential impact on the General Fund. It also stands as a glaring example of Salem’s chronic fiscal irresponsibility.”
Rep. Wingard said that the BETC program has diverted hundreds of millions of dollars away from essential General Fund-supported programs such as education, public safety and health care. The Legislature’s simultaneous passage of $733 million in permanent, job-killing taxes is further proof that state government is failing to spend tax dollars wisely.
“It’s hard to claim the state is desperate for money to fund schools at the same time it is giving away hundreds of millions of dollars to promote “˜green’ projects,” Rep. Wingard said. “The BETC tax credit data shows that many in Salem would rather raise taxes during a recession than prioritize spending and put our school kids first.”