OAR Chapter 123 — Oregon Business Development Department

Division 1 PROCEDURAL RULES

Or. Admin. R. 123-001-0050 Definitions

For purposes of this division of administrative rules, and generally throughout this chapter of administrative rules, unless the context demands otherwise:

(1) Authority means the Infrastructure Finance Authority within the Oregon Business Development Department.

(2) Board means the Oregon Infrastructure Finance Authority Board.

(3) Brownfield means real property where expansion or redevelopment is complicated by actual or perceived environmental contamination as defined in ORS 285A.185(1).

(4) Collateral means property subject to a security interest or agriculture lien, as well as proceeds to which security interests attaches, and those defined in ORS 79.1050.

(5) Commission means the State of Oregon Business Development Commission appointed under ORS 285A.040.

(6) Department means the State of Oregon Business Development Department as established under ORS 285A.070.

(7) Director means the director of the Oregon Business Development Department as appointed under ORS 285A.070.

(8) Distressed Area means a geographic area within the state of Oregon that meets the criteria set forth under OAR 123-024-0031.

(9) Finance Committee means the financial committee formed by the Oregon Business Development Commission as defined in OAR 123-001-0520.

(10) Financial Institution means a financial institution as defined in ORS 706.008.

(11) First Source Hiring Agreements means the hiring agreements as described in OAR 123-070.

(12) Grant means an award of monies to an approved recipient for eligible purposes.

(13) Governor means the sitting Governor of the State of Oregon, pursuant to Article V of the Constitution of Oregon.

(14) Loan means department financing provided to an approved recipient for eligible purposes.

(15) Port means a municipal corporation organized under ORS chapter 777 or 778, which may be known as a "port authority" or "port district."

(16) Rural Area means an area located entirely outside of the acknowledged Portland Metropolitan Area Regional Urban Growth Boundary and the acknowledged urban growth boundaries of the cities with populations of 30,000 or more according to the most recent population estimates developed by the Portland State University, Population Research Center.

(17) Small Business means a business having 100 or fewer employees in accordance with ORS 285A.010(9)

(18) State Revenue Bonds means bonds issued by the State of Oregon that are payable from specific revenue sources and are not a pledge of the full faith and credit of the State of Oregon.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075, ORS 77.0102(L), ORS 777 & ORS 778
OBDD 16-2026, amend filed 08/14/2026, effective 08/14/2026
OBDD 2-2020, amend filed 02/07/2020, effective 02/07/2020
EDD 8-2009, f. & cert. ef. 10-1-09
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0100 Notice of Rulemaking (Proposed Permanent Rulemaking)

In proposing to amend, repeal or adopt permanent administrative rules for this chapter, pursuant to ORS 183.335(1)(a) and 183.341(4):

(1) The Department shall at a minimum do the following with respect to those listed in section (2) of this rule:

(a) Furnish a copy of the notice of proposed rulemaking, as published or to be published in the Oregon Bulletin consistent with ORS 183.335(1)(b); and

(b) Make available a copy of the proposed rule language to be amended or adopted.

(2) All of the following are included for purposes of section (1) of this rule:

(a) The current list of persons and organizations that have requested notification, in accordance with ORS 183.335(1)(c) and (8);

(b) Certain legislators, as prescribed in ORS 183.335(1)(d) and (15);

(c) Department of Land Conservation and Development, consistent with the time frame for subsection (b) of this section, for rules governing any program or activity affecting land use (see Division 008 of this chapter of administrative rules);

(d) The following organizations and media sources, consistent with the time frame for subsection (a) or (b) of this section:

(A) Associated Press;

(B) Association of Oregon Counties;

(D) League of Oregon Cities; and

(E) Oregon Department of Administrative Services, Director’s Office, for any substantial program change not arising directly from legislation; and

(e) Any other media source, person or party interested in or significantly affected by the proposed rulemaking, as determined by the Department, depending on the particular nature and subject of the rules, which might include but is not limited to Economic Development Districts, Port Districts, Public Ports Association, Special Districts Association, Associated Oregon Industries, industry or contractor associations, nonprofit or labor organizations, local newspapers, business publications, local units of government, or state and federal agencies. This subsection may be carried out consistent with the time frame for subsection (a) or (b) of this section.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075, ORS 183.335 & ORS 183.341
OBDD 2-2020, amend filed 02/07/2020, effective 02/07/2020
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0200 Model Rules of Procedure

(1) Division 001 and any statutorily mandated element in the other divisions of the State of Oregon Attorney General’s Uniform and Model Rules (OAR chapter 137), pursuant to the Administrative Procedures Act (ORS Chapter 183), are hereby incorporated into and adopted as part of this division of administrative rules, by reference. These and other relevant documents are published in the Attorney General’s "Administrative Law Manual," which may be obtained from the Oregon Department of Justice, Publications Section, Justice Building Room 16, 1162 Court Street NE, Salem, OR 97301-4096.

(2) No internal guidance materials of the Department for purposes of administrative rules are incorporated into or adopted as part of this division of administrative rules, in any way, and such materials are not binding on the rulemaking procedures of the Department except insofar as they coincide with requirements pursuant to section (1) of this rule.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 183.335, 183.341, 183.355, 285A & 285B
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0300 Waivers of Provisions Provided by Rule in This Chapter

The Director or the Director's designee may formally waive requirements otherwise prescribed by this chapter of administrative rules, if such a waiver serves to further the goals and objectives of ORS Chapters 285A, 285B and 285C and results in sound economic development or job creation in the state, such that:

(1) The requirement must be an invention of the administrative rule itself, and not arise from policies established by the Commission or from any state or federal law, including cases where state law might in some way be ambiguous, but the administrative rule is considered to correctly and optimally clarify or interpret that law;

(2) This rule applies whether or not the division of administrative rule similarly provides for waiver by the Director; and

(3) This rule does not interfere with other ways to make exceptions or to provide flexibility, as described elsewhere for certain administrative rules, and it is not meant to substitute for the timely amendment of administrative rules.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A & 285B
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0500 Commission Committees

For purposes of advisory and technical committees for the Commission:

(1) These committees are different from, and this rule does not apply to, statutory boards or commissions affiliated with the Department, but whose appointment, authority, duties and relationship to the Commission, if any, are prescribed (such as the Oregon Arts Commission under ORS 359.010 to 359.137) by the Legislative Assembly.

(2) The committees under this rule, which are part of the Department and are public bodies as subsidiaries to the Commission, consist of Ad Hoc Committees established solely by authority of the Commission and operating at its discretion under ORS 285A.060.

(3) An Ad Hoc Committee (“it” for purposes of this section), as defined in subsection (2) of this rule, is subject to the following parameters:

(a) The Commission must create it by a formal and public action for a certain definite period, or otherwise it may exist and operate until the Commission terminates or suspends it;

(b) The chair of the Commission is primarily responsible for appointing each of its members, which serve at the chair’s pleasure (the Director or designee is always an ex officio member), and for determining its makeup and similarly fundamental attributes;

(c) Its membership shall broadly reflect the different geographic regions of this state, and at least one of its members shall reside east of the Cascade Range;

(d) It shall provide advice and recommendations to the Commission or the Department, although it may exercise, on a day-to-day basis, such duties or powers as the Commission delegates to it;

(e) It is subject to the Commission’s review and to reporting its decisions, actions and agenda for future meetings, which any member of the Commission may attend;

(f) It may adopt standards and procedures for its activities, with or without direction from the Commission; and

(g) Regardless of anything described in this chapter of administrative rules, the Commission reserves the discretion to change any delegation and directive related to its future functions, at any time.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.060
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0520 Finance Committee for the Commission

The Finance Committee is an Ad Hoc Committee that has been formed and empowered by the Commission in accordance with ORS 285A.060 such that:

(1) The Commission charges the Finance Committee (pursuant to divisions of this chapter of administrative rules) with the following:

(a) Immediate oversight and the approval of projects and proposals under the following business finance programs:

(A) Economic Development Revenue Bonds (division 011);

(B) Oregon Business Development Fund (division 017); and,

(b) Consideration on appeal of administrative denials of business loans under the following programs:

(A) Entrepreneurial Development Loan Fund (division 019); and

(B) Credit Enhancement Fund (division 021);

(D) Small Business Expansion Loan Fund aka Oregon Royalty Fund (division 092)

(2) The Finance Committee’s members:

(a) Are appointed by the chair of the Commission to include representation from among this state’s banking and financial community, as well as at least one member possessing general experience with a traded-sector industry or industry association; and

(b) Serve indefinite terms at the pleasure of the Commission’s chair, such that a newly appointed Commission chair assumes the makeup and organization of the current Finance Committee until the Commission chair initiates changes.

(3) The Commission’s chair shall select a chairperson for the Finance Committee, such that:

(a) The chairperson shall call meetings and set agendas for the Finance Committee with the assistance of Department staff; and

(b) A member chosen by the chairperson (or otherwise, the longest-serving member present) shall preside over a Finance Committee meeting at which the chairperson is absent.

(4) The supervisor of the Department’s business finance programs shall administer the operations of the Finance Committee, officially carry out its decisions, prepare business for its consideration with the chairperson’s consent, and serve as an ex officio member on behalf of the Director.

(5) Nothing in this rule, or elsewhere in this chapter of administrative rules, interferes with the Commission’s authority to dissolve the Finance Committee or to redirect its future procedures and purposes.

History

Statutory/Other Authority: ORS 285A.075, 285B.056, 285B.206(3) & 285B.743(2)
Statutes/Other Implemented: ORS 285A.060, 285A.666 - 285A.732, 285B.050 - 285B.098, 285B.200 - 285B.285B.218, 285B.320 - 285B.371 & 285B.740 - 285B.758
OBDD 2-2020, amend filed 02/07/2020, effective 02/07/2020
EDD 8-2009, f. & cert. ef. 10-1-09
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 4-2003, f. & cert. ef. 3-26-03

Or. Admin. R. 123-001-0700 Contested Case Proceedings

(1) OAR 123-001-0700 to 123-001-0750 establish procedural steps and options for handling appeals, in the manner of a contested case under ORS 183.310 to 183.550, when the Department denies:

(a) An application for either preliminary certification or annual certification to exempt the taxable income of a facility under ORS 316.778 or 317.391 (see OAR 123-635), other than when denial results from objection to preliminary certification by the city, county or port; or

(b) Any other application or request for which state law provides for appeal by contested case.

(2) Except as otherwise provided under state law or elsewhere in this chapter of administrative rules, this rule and contested case provisions do not pertain to any other proceeding, hearing, determination or decision by the Department, Director, Commission or any subsidiary body.

(3) OAR 123-001-0700 to 123-001-0750 are intended only to supplement mandatory elements of contested case proceedings under the Administrative Procedures Act for matters specific to the Department. Therefore, relevant parts of OAR 137-003 are hereby incorporated into and adopted as part of this division of administrative rules by reference.

(4) For purposes of OAR 123-001-0700 to 123-001-0750, unless the context demands otherwise:

(a) “Applicant” means the person (including but not limited to a business firm) that sought approval under section (1) of this rule, as identified in the application form or other submitted materials. This person is thus the affected party or appellant for purposes of the contested case, and the submitted address given in the form is assumed correct for mailing the Notice.

(b) “Notice” means the formal written statement on Department letterhead that the Department initially sends to the Applicant, in accordance with OAR 123-001-0725.

History

Statutory/Other Authority: ORS 183.341(2), 183.417(2), 183.464(2) & 285A.075
Statutes/Other Implemented: ORS 183.413 - 183.470 & 285C.500 - 285C.506
OBDD 18-2019, minor correction filed 12/16/2019, effective 12/16/2019
OBDD 40-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 12-2004, f. & cert. ef. 7-27-04

Or. Admin. R. 123-001-0725 Steps and Reservations of the Department

(1) As described in OAR 123-001-0700, the Department shall send notice to the applicant, such that:

(a) The Department sends notice by registered or certified mail;

(b) If a copy is sent also by regular, first-class mail, it must be so mailed at least five days prior to the notice as described in subsection (a) of this section; and

(2) The notice, on Department letterhead, shall include but is not limited to the following:

(a) The date and other pertinent facts of the Department’s receipt of the application;

(b) Brief explanation of why the Department is unable to approve it;

(c) Reference to the specifically relevant statutory subsection(s) or administrative rule section(s), and further explanation, as warranted, regarding how these references support the Department’s conclusion(s);

(d) Statement of the applicant’s right to a contested case hearing on the matter before an administrative law judge and to be represented by legal counsel;

(e) Designation of the Department’s current file on the application as the record for purposes of proving a prima facie case upon default; and

(f) Instruction on how the applicant must file a written request in order to receive the hearing, such that the request is received by the Department on or before a specified date not less than 30 calendar days after the Notice.

(3) The Department reserves the option (at its sole discretion) to withdraw the proposed denial and grant certification to the applicant for any reason, prior to a final order, including but not limited to the re-submission of a new application or the consideration of evidence that alters the Department’s prior conclusion(s), as otherwise allowed under the applicable laws.

(4) Upon default by the applicant, including but not limited to failure to timely file a request for a hearing with the Department, the Department shall promptly issue a final order denying certification, furnishing a copy to the Department of Revenue/county assessor as relevant.

(5) If the applicant files a timely request for a contested case hearing, the case shall be referred to the Office of Administrative Hearings and a copy of the referral furnished to the applicant, General Counsel and the Department of Revenue/county assessor as relevant.

(6) The administrative law judge will issue a proposed order, pursuant to applicable proceedings of the contested case hearing, and except as set forth in subsection (7)(a) or (b) of this rule, that proposed order shall become final by order of the administrative law judge not less than 45 calendar days after the issuance of the proposed order.

(7) A proposed order in section (6) of this rule shall not become final if:

(a) The Department gives timely written notification to the parties and the administrative law judge of its intent to alter the findings or effect of the order, subsequent to which it shall issue an amended proposed order and/or final order, as warranted.

(b) Within 30 calendar days from issuance of the proposed order, a party files written exceptions with both the Department and the administrative law judge that concisely present the party’s entire argument against the proposed order, and the Department subsequently requests in writing that the administrative law judge undertake further steps. Such steps include, but are not limited to, an official response to the exceptions or the hearing of new or additional evidence.

History

Statutory/Other Authority: ORS 183.341(2), 183.417(2), 183.464(2) & 285A.075
Statutes/Other Implemented: ORS 183.413 - 183.470 & 285C.500 - 285C.506
OBDD 40-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 8-2009, f. & cert. ef. 10-1-09
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 12-2004, f. & cert. ef. 7-27-04

Or. Admin. R. 123-001-0750 Representations by Agency Representative

For purposes of any contested case hearing before an administrative law judge:

(1) Subject to the approval of the office of Attorney General of the State of Oregon under ORS chapter 180, the Director may authorize an officer or employee of the Department to appear on behalf of the Department.

(2) Such a Department representative may not present legal argument on behalf of state government.

(3) The Department retains its full prerogative, with or without intervention by the administrative law judge, to consult with or otherwise involve the office of Attorney General. Such prerogative includes but not necessarily limited to the sole purpose of having the office of Attorney General present legal argument at the hearing or to file written legal argument within a reasonable time after conclusion of the hearing.

(4)(a) “Legal argument” includes arguments on:

(A) The jurisdiction to hear the contested case;

(B) The constitutionality of a statute or rule or the application of a constitutional requirement to the Department; and

(b) “Legal argument” does not include presentation of motions, evidence, examination and cross-examination of witnesses or the presentation of factual arguments or arguments on:

(A) The application of the statutes or rules to the facts in the contested case;

(B) Comparison of prior actions of the agency in handling similar situations;

(D) The admissibility of evidence; and

(E) The correctness of procedures followed in the contested case hearing.

History

Statutory/Other Authority: ORS 183.452(2)(b) & 285A.075
Statutes/Other Implemented: ORS 183.411 & 183.452
OBDD 40-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 15-2008, f. & cert. ef. 6-4-08
EDD 11-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 1-2008, f. & cert. ef. 1-2-08
EDD 12-2004, f. & cert. ef. 7-27-04

Division 5 ACCESS TO PUBLIC RECORDS, FEES FOR RECORD SEARCH AND COPIES OF PUBLIC RECORDS/PUBLICATIONS

Or. Admin. R. 123-005-0000 Applicability of Rules and Definitions

This division of administrative rules applies to all public records for which the Department is custodian of. For the purposes of these rules definitions may be found in Procedural Rules, OAR 123-001.

History

Statutory/Other Authority: ORS 285A.075(A)
Statutes/Other Implemented: ORS 192.410 - 192.505, 285A & 285B
EDD 9-2009, f. & cert. ef. 10-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1993, f. & cert. ef. 12-2-93

Or. Admin. R. 123-005-0010 Access to Records

In carrying out responsibilities under ORS 192.410 to 192.505, the Department shall:

(1) Make restrictions and take precautions necessary to protect the integrity of the records and prevent interference with the regular discharge of the Department’s duties;

(2) Maintain the confidential nature of records as provided under ORS 192.502(16), 285A.090(5), 285B.701(4) and other applicable state or federal laws, including but not limited to protecting the attorney-client privilege, as well as related provisions in OAR 123-017-0040 or other administrative rules.

(3) Allow that public records of the Department to be inspected or examined, subject to prior request, approval and arrangements, during the normal working days and hours of the offices of the Department at which the records are kept. The inspection or examination shall take place at the main office, a field office, or any other reasonable location designated by the Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 192.410 - 192.505, 285A & 285B
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1993, f. & cert. ef. 12-2-93

Or. Admin. R. 123-005-0020 Requests to Inspect or Obtain Copies of Public Records

(1) A request to inspect or obtain copies of a public record or information from public records shall be made in writing (Attention: Public Information Staff, Oregon Business Development Department, State Lands Building Suite 200, 775 Summer Street NE, Salem, OR 97301-1280), and shall include:

(a) The name, address and telephone number of the requester;

(b) Identification of the needed public record, or of the type and format of needed public record information, if known to the requester;

(c) Time period records were produced and officials involved in producing records or other relevant information, if known to the requester; and

(d) The number of copies for each item requested of the record, if copies are requested.

(2) The Director may waive the requirement under section (1) of this rule for a request to be made in writing, if it is determined that the waiver contributes to effective administration.

History

Statutory/Other Authority: ORS 285A.075(A)
Statutes/Other Implemented: ORS 192.410 - 192.505, 285A & 285B
EDD 9-2009, f. & cert. ef. 10-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1993, f. & cert. ef. 12-2-93

Or. Admin. R. 123-005-0030 Payment for Inspection and Copies of Public Records

(1) Except as waived in section (2) of this rule, a person who is receiving a copy of a public record or information from a public record shall pay the Department’s actual cost for:

(a) Staff time necessary to identify, locate, summarize or compile the record as requested;

(b) Attorney fees, staff time and so forth associated with the screening of materials or blocking out of text that is exempt from disclosure;

(d) Customary fee per page for reproduction, handling and assembling of copies to be provided; and

(e) Postage or similar expenses and special supplies or services necessary to furnish the copy or information.

(2) The Director may reduce or waive the payment or charges in section (1) of this rule, if the Director determines that the reduction or waiver will aid in the effective administration of Department operations or is in the public interest because making the record available substantially benefits the general public.

(3) The Department shall as necessary establish a schedule of costs and charges for purposes of this division of administrative rules, which shall apply to all concurrent public records requests.

(4) The requester shall pay all fees for access to a public record in advance, based on estimates by the Department, unless the Director approves late payment.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 192.410 - 192.505, 285A & 285B
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1993, f. & cert. ef. 12-2-93

Division 6 PROCEDURES FOR CONTRACTS ENTERED INTO WITH THE BUSINESS DEVELOPMENT DEPARTMENT

Or. Admin. R. 123-006-0005 Purpose

Pursuant to ORS 285A.075(3), the department may enter into contracts as necessary or appropriate to carry out its authorized mission. This rule sets forth the Department's procurement and contracting procedures. This rule does not apply to financing contracts, grants, interagency or intergovernmental agreements, office leases, or contracts specifically directed by statute.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279A.070
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05
EDD 21-2004, f. & cert. ef. 8-5-04
EDD 11-2004(Temp), f. & cert. ef. 6-15-04 thru 8-5-04
EDD 11-2003(Temp), f. & cert. ef. 12-23-03 thru 6-15-04
EDD 4-1991, f. & cert. ef. 5-20-91

Or. Admin. R. 123-006-0020 Standard Procedures and Exceptions

The Department will comply with the Oregon Department of Justice Model Public Contract Rules, OAR chapter 137, divisions 046, and 047, as applicable, for all its procurement and contracting activity, with the following exceptions:

(1) For Architectural, Engineering, and Land Surveying contracts, a special class of personal services contracts, the Department will comply with OAR chapter 137, division 048. Services defined as Related Services are subject to 123, division 6.

(2) For contracts relating to the Department's foreign trade offices operating outside the state, the provisions of OAR 137-047-0700 through 137-047-0760 (regarding legal remedies) shall not apply to public contracts under this division.

(3) For contracts, other than those identified in (1) or (2) of this rule, that are best implemented as multiple work order contracts under an Agreement for Goods or Services, the Department will comply with OAR 123-006-0025.

(4) The provisions of OAR 137-047-0800, 137-047-0265(2) and 137-047-0270(3) (regarding contract amendments) do not apply to contracts by the Department.

(5) The provisions of OAR 137-047-0670 (regarding cancelled offers) do not apply to contracts by the Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279A.070
OBDD 37-2010, f. 10-29-10, cert. ef. 11-1-10
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05
EDD 21-2004, f. & cert. ef. 8-5-04
EDD 11-2004(Temp), f. & cert. ef. 6-15-04 thru 8-5-04
EDD 4-1991, f. & cert. ef. 5-20-91

Or. Admin. R. 123-006-0025 Use of Work Order Contracts

(1) Contracts may be implemented as multiple Work Order Contracts under an Agreement for Goods or Services instead of a single contract if that implementation will provide substantial savings in time or cost, or both.

(2) The Department and the selected contractor will sign a non-binding Agreement for Goods or Services, in which the Contractor acknowledges its readiness to enter into separate work order contracts with the Department that will describe, among other things, the specific goods or services to be performed, the timeline for delivery, and the compensation. Each Work Order Contract subsequently executed with the Contractor pursuant to the non-binding Agreement for Goods or Services must be within the scope of the solicitation, if any, and will constitute a separate legally binding contract between the Department and the Contractor.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279.070
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05
EDD 21-2004, f. & cert. ef. 8-5-04
EDD 11-2004(Temp), f. & cert. ef. 6-15-04 thru 8-5-04
EDD 4-1991, f. & cert. ef. 5-20-91

Or. Admin. R. 123-006-0030 Electronic Public Notice

For all required public notices or advertisements related to source selection methods, the Department may publish the notice or advertisement on the Department of Administrative Services Electronic Procurement System instead of publishing notice in a newspaper of general circulation as described in ORS 279B.055(4)(b).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279A.070
OBDD 10-2019, minor correction filed 08/12/2019, effective 08/12/2019
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05

Or. Admin. R. 123-006-0035 Contract Amendments

(1) General Rule. The Department may amend any contract without additional competition, including reinstatements and cost overruns, but only when the Department has determined:

(a) The amended Contract is within the Scope of the Solicitation Document, or if no Solicitation Document, the Contract; or in the instance of a Special Procurement, the approval of Special Procurement;

(b) The amended Contract does not adversely affect the competitive conditions for the original contract; and

(c) If the Contract was selected according to the Small Procurement method, the total compensation does not exceed $10,000, or, if selected according to the Intermediate Procurement method, the total compensation does not exceed $150,000.

(2) Anticipated Amendments.

(a) "Anticipated Amendment" means the Department has text in any Solicitation Document and the Contract that explains:

(A) The possibility of one or more Amendments;

(B) A general description of circumstances that might require an Amendment to be issued under the Contract and any changes to the requirements of the Contract that may be anticipated or even planned for, but not necessarily quantified at the time of Contract execution. These changes may be described in any Solicitation and Contract as, for example: Extra Work or Goods; Additional Work; Work to be done if certain situations are encountered; or Changes in terms, conditions, price, or type of Work; etc.; and

(C) The provisions of the Contract that are subject to negotiation in order to finalize the details and costs of such an Amendment.

(b) Anticipated Amendments do not include cost overruns or reinstatements.

(c) The Department may make one or more Anticipated Amendments to a Contract without any additional competitive process and for an unlimited amount, subject to section (1) of this rule.

(3) Unanticipated Amendments.

(a) "Unanticipated Amendment" means any Amendment that does not meet the requirements of an Anticipated Amendment. Unanticipated Amendments do not include cost overruns or reinstatements.

(b) Limited Amount. The Department may make one or more Unanticipated Amendments to a Contract without any additional competitive process, provided the cumulative amounts of all Unanticipated Amendments do not exceed 100% of the Original Contract amount and subject to section (1) of this rule.

(c) Unlimited Amount. The Department may make one or more Unanticipated Amendments to a Contract without any additional competitive process and for an unlimited amount, subject to section (1) of this rule, and provided the Department's Designated Procurement Officer gives written approval of the Unanticipated Amendment as meeting the following requirements:

(A) The Unanticipated Amendment is due to circumstances that were unforeseen at the time the original Contract was established;

(B) The Unanticipated Amendment does not represent any important general change that alters the essential identity or main purpose of the original Contract, nor is of such importance that it should be a new undertaking; and

(C) The Unanticipated Amendment serves the public interest, including specific reasoning to support that conclusion. Reasons may include, but are not limited to: To address emergencies arising in the course of the Contract that require prompt action to protect the Work already completed or Goods delivered; to comply with official or judicial commands or directives issued during contract performance; or to ensure that the purpose of the Contract will be realized.

(4) Cost Overruns.

(a) Unless the Contract provides that the maximum total compensation is based on an estimate and is subject to amendment, if Contractor expends all authorized compensation but the required Goods, Work or Services are not complete or are not satisfactory, Contractor is responsible to complete the Goods, Work or Services to Department's satisfaction without further compensation.

(b) Notwithstanding the general rule in subsection (4)(a) above, Department may, by Amendment to the Contract, agree to increases in the maximum total compensation, subject to section (1) of this rule, and provided the Department's Designated Procurement Officer gives written approval of the Cost Overrun Amendment as meeting the following requirements:

(A) The cost overrun arose out of circumstances or conditions encountered in the course of contract performance that were unavoidable and not reasonably anticipated at the time of the original Contract, or the most recent Amendment, if any;

(B) The cost overrun was incurred in good faith, results from the good faith performance by the Contractor, and is no greater than the prescribed hourly rate or the reasonable value of the additional Goods, Work or Services rendered; and

(C) The Cost Overrun Amendment serves the public interest, including specific reasoning to support that conclusion. Reasons may include, but are not limited to: To address emergencies arising in the course of the Contract that require prompt action to protect the Work already completed; to comply with official or judicial commands or directives issued during contract performance; or to ensure that the purpose of the Contract will be realized.

(5) Reinstatements.

(a) "Reinstatement" of an expired Contract means an amendment to restore the full action of the Contract as though the expiration had not occurred, and extend the Contract to a new expiration. A reinstatement may be combined with any other amendment allowed by this rule.

(b) The Department's Designated Procurement Officer may give written approval to reinstate an expired Contract if the following requirements are met:

(A) The failure to extend or renew the Contract in a timely manner was due to unforeseen or unavoidable conditions, or if due to administrative mistake, the reason for the mistake and the steps taken to prevent similar mistakes;

(B) The expiration occurred in good faith on the part of both the Department and the Contractor;

(C) The reinstatement furthers the public interest, compared to a separate procurement process, including specific reasoning to support that conclusion; and

(c) When a Contract is reinstated pursuant to this section, the Department may compensate the Contractor only at the rate or terms of compensation established in the original Contract, for Goods, Work or Services performed in the interim between the expiration of the original Contract and the execution of the Reinstatement Amendment.

(6) Amendments of Contracts for Architectural, Engineering and Land Surveying Services. This rule does not apply to amendments of Contracts for Architectural, Engineering and Land Surveying Services. The Department will comply with the Oregon Department of Justice Model Public Contract Rules, OAR chapter 137, division 048 for amendments to such contracts.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279.070
OBDD 15-2019, amend filed 10/04/2019, effective 10/04/2019
OBDD 1-2014, f. 2-28-14, cert. ef. 3-3-14
OBDD 14-2013(Temp), f. & cert. ef. 12-30-13 thru 6-27-14
OBDD 2-2012, f. 3-30-12, cert. ef. 4-2-12
OBDD 37-2010, f. 10-29-10, cert. ef. 11-1-10
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05

Or. Admin. R. 123-006-0040 Contracts Must be Authorized Prior to Performance

All Contracts, including any amendments, must be in writing and fully executed before any Work or Services may be performed or payment made. Contractors are not entitled to payment for any Work or Services performed prior to such execution.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 279.070
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 11-2005, f. 11-30-05, cert. ef. 12-1-05

Or. Admin. R. 123-006-0045 Sole Source Procurements, by Rule.

The Department may procure goods or services for the following subjects without competition:

(1) Advertising and Promotion. This covers all types of advertising placement, including booth space at trade shows and exhibitions. This does not include development of advertising or trade show services.

(2) Bond Counsel. The Department will follow the procedures and requirements of ORS 286A.130 and any applicable Oregon Administrative Rules.

(3) Event Speakers. This covers those contracts for event speakers such as a keynote address. This does not cover those contracts for services such as training instructors or facilitators of meetings.

(4) Conferences, Meetings, Events. This covers facilities for housing or conducting meetings or events, as well as hotels or other lodging accommodations for those attending such meetings or events.

(5) Organizational Memberships. This covers dues, registrations, and membership fees in organizations the Department chooses to associate with. This does not cover memberships for individuals.

(6) Foreign Trade Missions. This covers procurement expenditures necessary during the duration of a foreign trade mission. This does not include foreign trade shows. This does not include employee travel reimbursements.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075, 279A.070 & 279B.075
OBDD 15-2019, amend filed 10/04/2019, effective 10/04/2019
OBDD 37-2010, f. 10-29-10, cert. ef. 11-1-10
EDD 26-2008, f. 8-28-08, cert. ef. 9-1-08

Division 8 QUALITY DEVELOPMENT AND LAND USE COORDINATION

Or. Admin. R. 123-008-0005 Purpose and Scope

The Oregon Business Development Commission through the Oregon Business Development Department in accordance with this division of administrative rules has established policies and procedures for mandatory compatibility with Oregon's Planning Goals and associated land use plans and standards.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0010 Policy

It is the policy of the Oregon Business Development Department that prior to approving or undertaking projects or actions under an Applicable Program, as defined in OAR 123-008-0015, the Department shall take steps or have program procedures for accomplishing compliance and compatibility with Planning Goals, principally through the applicable acknowledged comprehensive plans and the land use regulations of local governments, in accordance with OAR chapter 660, division 030.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0015 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) Applicable Programs mean those funds, incentives and other activities, powers and resources of the Department and the Commission that directly influence physical development on or to the landand will generally not include educational, marketing, technical assistance, funds for technical analysis or other similar programs.

(2) Planning Goals mean the mandatory statewide planning standards for land use as adopted by the Oregon Land Conservation and Development Commission under ORS Chapters 195, 196 and 197, and are available and may be obtained from the Oregon Department of Land Conservation and Development, 635 Capitol Street, NE, Suite 150, Salem, Oregon 97301-2540.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0020 Compliance with Planning Goals

(1) The Department shall achieve Planning Goal compliance whenever possible by taking actions that are compatible with the applicable acknowledged comprehensive plan of a county or city government and land use regulations of this state and local zone ordinances.

(2) However, if a situation arises that necessitates direct goal findings, because of potential or actual incompatibility under a local comprehensive plan or other reasons, as described in OAR 660-030-0065(3), the Department shall adhere to the following procedures, as formally as appropriate:

(a) Confirm that a situation exists requiring the Department to adopt direct goal findings of compliance with one or more of Planning Goals;

(b) Identify which Planning Goals or Goal requirements the Department must address;

(d) Request interpretative guidance as needed from the Department of Land Conservation and Development or the Department of Justice;

(e) Rely on any relevant goal interpretations for state agencies adopted in accordance with OAR chapter 660, whenever applicable; and

(f) Adopt any necessary findings to ensure compliance with the Planning Goals.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0025 Compatibility with Acknowledged Comprehensive Plans and Land Use Regulations

For purposes of this division of administrative rules, and to act compatibly with acknowledged comprehensive plans and land use regulations, except when the Department makes direct findings for compliance with Planning Goals consistent with OAR 123-008-0020(2), a project applicant for resources under an Applicable Program shall effectively verify to the project's compliance with the applicable city or county comprehensive plan, public facility plan and land use regulations, through mechanisms such as the following:

(1) Receipt of a copy of the local land use permit or equivalent documentation from the city or county planning agency or the local governing body that the project has received land use approval;

(2) Receipt of a letter from the local planning agency or governing body stating that the project is permitted under the jurisdiction's comprehensive plan and land use regulations but does not require specific land use approval;

(3) Copies of official land use maps or other local documents that demonstrate necessary compliance; or

(4) Other equivalent documentation from the affected city or county.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0030 Dispute Resolution

(1) When a land use dispute related to a proposal or application for financial assistance under an Applicable Program arises, the proposal sponsor/applicant is expected to resolve the dispute directly with the government of the city or county where the proposed project is to be located. The Department will not provide funding for such a project until the dispute is resolved, as indicated by documentation pursuant to OAR 123-008-0025.

(2) In other cases, the Department may attempt to resolve disputes regarding land use issues by direct contact with the applicable local governing body. Whenever possible, Department efforts to resolve land use disputes shall be pursued prior to and through local government land use proceedings.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.075
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 21-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0035 Compliance and Compatibility of New or Amended Programs

The Department of Land Conservation and Development is expressively listed in the Department’s Notice Rule, OAR 123-001-0100, and the Department shall follow the same notice procedures whenever amending the "Land Use Coordination Program."

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.110(1)
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Or. Admin. R. 123-008-0040 Consistency with Local Economic Development Plans

Applicable adopted local economic development plans under ORS 285A.055(5) include, but are not limited to, relevant parts of the comprehensive (land use) plans of cities and counties, such as those related to Planning Goal 9.

History

Statutory/Other Authority: ORS 285B.075(5) & 285A.110(1)
Statutes/Other Implemented: ORS 197.180, 285A & 285B
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 9-1990, f. & cert. ef. 5-23-90

Division 9 OREGON BUSINESS, INNOVATION AND TRADE FUND

Or. Admin. R. 123-009-0050 Purpose

The Oregon Business, Innovation and Trade Fund is established by ORS 285A.227 as a means to provide the Oregon Business Development Department with flexibility in funding and decision-making to respond to economic development needs on a statewide and regional basis.

History

Statutory/Other Authority: ORS 285A.075 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
EDD 11-2009, f. & cert. ef. 10-1-09
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Or. Admin. R. 123-009-0060 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context requires otherwise the following definitions apply:

(1) Fund means the Oregon Business, Innovation and Trade Fund established in ORS 285A.227, which includes lottery funding for grant and loan programs and contracted services and all interest earnings that accrue to the Fund.

(2) "Allocation Plan" means the distribution plan of the legislatively authorized Fund biennial budget.

History

Statutory/Other Authority: ORS 285A.075 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
OBDD 1-2013, f. & cert. ef. 1-2-13
EDD 11-2009, f. & cert. ef. 10-1-09
EDD 16-2008, f. & cert. ef. 6-4-08
EDD 12-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 2-2008, f. & cert. ef. 1-2-08
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Or. Admin. R. 123-009-0070 Commission Allocations

(1) The Commission shall distribute resources in the Fund within the policies and priorities set by the Legislature and pursuant to ORS 285A.020, 285A.045 and 285A.055.

(2) In the event of a shortfall of lottery funds, reductions will occur as prescribed by the Legislature and based on recommendations of the Commission.

History

Statutory/Other Authority: ORS 285A.075(5), 285A.110 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Or. Admin. R. 123-009-0080 Commission Responsibilities

(1) The Commission shall review and approve a biennial Allocation Plan for the Fund.

(2) The Commission shall be responsible for making allocations from the Fund and may adjust these allocations based on need. In the event of lottery revenue shortfalls, the Commission may adjust allocations in accordance with any Legislative direction and recommendations of the Commission.

History

Statutory/Other Authority: ORS 285A.075 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
EDD 16-2008, f. & cert. ef. 6-4-08
EDD 12-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 2-2008, f. & cert. ef. 1-2-08
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Or. Admin. R. 123-009-0090 Criteria for Allocations

The Commission shall make biennial allocations from the Fund based on the following criteria:

(1) Funding shall be based on the principles established in ORS 285A.020, 285A.045 and 285A.055 to further business and economic development.

(2) Funds may be reserved and allocated to address opportunity-driven investments, projects and unanticipated needs.

(3) Consideration may be given to eliminating or combining funding for programs in allocations.

History

Statutory/Other Authority: ORS 285A.075 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
OBDD 1-2013, f. & cert. ef. 1-2-13
EDD 16-2008, f. & cert. ef. 6-4-08
EDD 12-2008(Temp), f. & cert. ef. 3-28-08 thru 9-23-08
EDD 2-2008, f. & cert. ef. 1-2-08
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Or. Admin. R. 123-009-0100 Director’s Review and Approval of Awards Under Allocation Plan

Once allocations from the Fund have been made by the Commission, the Director shall have final project funding approval unless otherwise delegated. All project funding shall be consistent with Commission allocations.

History

Statutory/Other Authority: ORS 285A.075(5), 285A.110 & 285A.227(2)
Statutes/Other Implemented: ORS 285A.227
EDDS 5-2000, f. & cert. ef. 2-7-00
Reverted to EDD 3-1998, f. & cert. ef. 2-26-98
EDD 4-1999(Temp), f. & cert. ef. 8-5-99 thru 2-1-00
EDD 3-1998, f. & cert. ef. 2-26-98

Division 11 OREGON ECONOMIC DEVELOPMENT REVENUE BONDS

Or. Admin. R. 123-011-0020 Purpose

The purpose of these rules is to provide procedures, standards and criteria for operation of the Oregon Economic Development Revenue Bond program authorized by ORS 285B.320 to 285B.371.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B.320 - 285B.371
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988 (Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 3-1985, f. & ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, ef. 1-1-85

Or. Admin. R. 123-011-0021 Commission Powers

For the purposes of these rules, the Business Development Commission (the “Commission”) shall retain and possess, in addition to all authority reserved to it under OAR 123-011-0027, all rights and powers delegated to the Finance Committee. Upon written notice to the Finance Committee, the Commission may elect to exercise directly, either in a specific instance or generally, any right or power delegated to the Finance Committee under these rules and the Finance Committee shall not have the authority to exercise the right or power identified in the notice under the circumstances described in the notice.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
Reverted to EDD 36-1988, f. & cert. ef. 12-15-88
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 36-1988, f. & cert. ef. 12-15-88

Or. Admin. R. 123-011-0025 Definitions

For the purposes of these rules, the following terms shall have the following meaning, unless the context clearly indicates otherwise:

(1) "Applicant" means any person, firm or public or private corporation or federal or state governmental subdivision or agency which submits an application for Oregon Economic Development Revenue Bonds.

(2) "Bonds" means Oregon Economic Development Revenue Bonds issued by the State of Oregon under ORS 285B.320 to 285B.371.

(3) “Capital Asset” means real or personal property that the Commission expects to be:

(a) Used in connection with a revenue-producing enterprise, an exempt, or a non-profit entity; and

(b) Located in Oregon.

(4) “Economic Development Project” means a Capital Asset and may also include one or more the following:

(a) Research and development conducted in Oregon; or

(b) Estimated operating expenses associated with a Capital Asset.

(5) “Eligible Project” means the portion of an Economic Development Project that the Commission:

(a) Has found in compliance with applicable standards of the Commission;

(b) Has found will produce benefits substantially in Oregon; and

(6) “Exempt Facility” means any facility described in section 142(a) of the Internal Revenue Code of 1986, as amended and in effect as of July 1, 2011.

(7) "Finance Committee" means the Finance Committee for the Business Development Commission as allowed in ORS 285A.060.

(8) "Financial Institution" means any commercial bank, mutual savings bank, savings and loan association, insurance company, investment bank or NASD securities underwriter licensed or authorized to do business in the State of Oregon.

(9) "In-state Plant Relocation" means the relocation of an Applicant's plant from one labor market area, as defined by the Oregon Employment Department, in Oregon to a different labor market area in Oregon.

(10) “Nonprofit Entity” means and institution, organization, or other entity exempt from taxation under section 501(c)(3) of the Internal Revenue Code of 1986, as amended and in effect as of July 1, 2011.

(11) "Oregon Express Bond Program" means a department program that involves a method of sale for a single client purchase that includes, but is not limited to, direct placement of bonds with a bank. Such a purchase does not require the use of placement agents, underwriters, marketing agents or letters of credit. To utilize this program, use of a standardized departmental bond process is required.

(12) "Treasurer" means the Treasurer of the State of Oregon or the Treasurer's designee.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 4-1995, f. 4-28-95, cert. ef. 5-3-95
EDD 14-1994(Temp), f. & cert. ef. 11-10-94
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988 (Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 3-1985, f. & cert. ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, cert. ef. 1-1-85

Or. Admin. R. 123-011-0027 Delegation

(1) Authority for the day-to-day operation of the Economic Development Revenue Bond Program, including determination of eligibility, authorization of the issuance of bonds, adoption of inducement and bond resolutions and amendments thereto, is delegated to the Finance Committee.

(2) The Finance Committee may adopt standards and procedures for the operation of the bond program. Such standards and procedures shall not be inconsistent with any part of this division.

(3) The Department may send to each member of the Commission a summary of each project to be considered by the Finance Committee. If so, Commissioners shall receive such summaries in sufficient time to comment on the projects and to attend each Finance Committee meeting, as each individual commissioner may in his or her sole discretion determine.

(4) The Commission shall review and evaluate the operation of the bond program as it may from time to time determine and may order any changes that it considers necessary or desirable.

(5) The Commission shall retain final authority over policies and administrative procedures governing the operation of the bond program.

(6) If at any time the Commission decides to take any action or make any decision, it may do so at any regular or special meeting or through any telephone conference call as the Commission in its sole discretion may determine.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
Reverted to EDD 36-1988, f. & cert. ef. 12-15-88
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 9-1988(Temp), f. & cert. ef. 3-18-88

Or. Admin. R. 123-011-0030 Application

(1) An Applicant desiring issuance of Economic Development Revenue Bonds must submit a complete application to the Department in a form approved by the Department.

(2) The application shall be received by the Department at least 21 days prior to the Finance Committee meeting at which the application will be considered. The Department may waive this requirement at its sole discretion.

(3) A non-refundable application fee shall be paid by an Applicant seeking Economic Development Revenue Bond financing with the Application submission, as specified in OAR 123-011-0045.

(4) Application materials may be obtained from the Oregon Business Development Department, 775 Summer Street N.E., Suite 200 Salem, OR 97301-1280.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 10-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 9-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
EDD 9-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 13-1990, f. & cert. ef. 6-7-90
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988 (Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 3-1985, f. & cert. ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, cert. ef. 1-1-85

Or. Admin. R. 123-011-0035 Determination of Eligibility

(1) The Department shall review the application.

(2) The Department shall make a recommendation to the Finance Committee to either approve or deny the application for eligibility for Economic Development Revenue Bonds. The review of the application will be based upon the standards set forth in this rule:

(a) The following Economic Development Projects are eligible for Economic Development Revenue Bonds, unless otherwise prohibited under this section:

(A) Manufacturing or other industrial production;

(B) Agricultural development or food processing;

(D) Development or improved utilization of natural resources;

(E) Research and development;

(F) Destination facilities other than retail or food service businesses;

(G) Convention and trade centers;

(H) Construction of buildings for corporate headquarters;

(I) Product distribution facilities;

(J) Transportation or freight facilities;

(K) Scientific testing including, but not limited to, medical, clinical or engineering testing services;

(L) Sports facilities not otherwise prohibited under paragraph (2)(b)(D) of this rule;

(M) Nonprofit entities organized under Section 501(c)(3) of the U.S. Internal Revenue Code ;

(N) Utilities, as allowed by ORS 285B.323(2);

(O) Management of waste;

(P) Other activities which represent a new technology or type of economic enterprise that the Finance Committee determines are needed to diversify the economic base of an area, or any other activities allowed by Federal law.

(b) Activities or projects that will not be considered for the issuance of Oregon Economic Development Revenue Bonds include:

(A) Retail businesses and shopping centers;

(B) Food service not part of a convention center or destination resort;

(D) Athletic, racquetball, handball clubs, amusement parks, or similar endeavors;

(E) Commercial office buildings except for corporate headquarters, unless the office building supports the eligible economic activities listed in (2)(a) of this section;

(F) Activities that maintain private memberships; are not open to the general public; or do not serve a broad cross section of the general public;

(c) The following serve as an elaboration and clarification of activities which qualify as Eligible Projects for Economic Development Revenue Bonds:

(A) "Destination Facility" means a project which has a significant impact on the regional tourism economy and has the capacity to be marketed to national or international markets. Incidental food service facilities may be included. Sleeping accommodations without unique attraction capabilities are not eligible;

(B) "Convention and Trade Centers" may include sleeping accommodations, but the majority of the total bond issue must be used for convention meeting facilities. Such facilities must have the capacity to seat a minimum of 300 people. However, the Finance Committee may approve financing for projects, as convention centers, consisting solely or primarily of sleeping accommodations, if the Applicant sufficiently demonstrates existing sleeping accommodations are inadequate for existing meeting facility space;

(C) "Corporate Headquarters" may qualify if a minimum of 75 percent of the floor space is allocated to the corporate headquarter function. Corporate headquarters do not include professional corporations for medicine, law, dentistry, or finance or office space to be leased to others;

(D) "Transportation" is not intended to include rolling stock or other highly moveable equipment operated by a carrier for hire;

(E) In deciding whether or not to approve economic development revenue bonding for a utility project, the Finance Committee may consider all relevant factors including but not limited to the utility company's published tariff schedules and construction and extension procedures as filed with the Oregon Public Utility Commission;

(F) "Pollution Control" equipment may qualify as part of projects that otherwise qualifies under this rule. Where pollution control equipment costs are incidental to the total capital investment of the project, the Finance Committee may qualify such equipment, provided the Oregon Department of Environmental Quality concurs;

(G) "In-State Plant Relocations" not accompanied by an expansion of the Applicant's business or employment, may be considered when the Applicant is able to demonstrate that:

(i) The relocation is caused by reasons beyond its control; or

(ii) The relocation will not cause a resulting loss of employment at the former site of the business; or

(iii) The relocation is necessary for the continued operation of the business.

(H) "Nonprofit entities" do not include religious or fraternal organizations;

(I) "Developer Project" may qualify. The Finance Committee shall have right of approval for each tenant occupying 25 percent or more of the leasable space. No more than 25 percent of the leasable space shall be leased to tenants relocating from another Oregon location, unless such relocation is accompanied by an expansion of the tenants' labor force. These conditions shall be incorporated into bond documents, shall survive closing and shall be enforceable for the term of the bond.

(d) The following serves as an elaboration and clarification of the qualifications of an Eligible Project for which Economic Development Revenue Bond proceeds can be used:

(A) The Applicant shall provide detailed information on the proposed uses of Bond proceeds for research and development costs. Research and development costs shall not represent a significant portion of the total amount of the Bonds, at the discretion of the Finance Committee.

(B) The Applicant shall provide detailed information on how Bond proceeds will be used for operating expenses. Operating expenses shall not represent a significant portion of the total amount of the Bonds, at the discretion of the Finance Committee.

(C) Unless the Finance Committee determines otherwise, Bond proceeds shall not be used to refinance outstanding financing, but may be used to reimburse approved Applicants for short-term financing for costs of Capital Assets.

(D) Unless the Finance Committee determines otherwise, Bond proceeds may only be used for capitalized interest that accrued prior to completion of an Eligible Project and that is directly related to the financing of a Capital Asset.

(e) Public Purpose. The Applicant must demonstrate that a public purpose is served by the proposed Economic Development Project through economic diversification, creation of new jobs including construction activity, construction occurring before it otherwise could or would, economic activity occurring during economic slumps, tax dollars remaining in the state, increased productivity, or other public health benefit as determined by the Finance Committee. The Applicant is encouraged to demonstrate as many public purposes for the proposed project as can be prudently shown.; The Finance Committee shall consider these public purposes in determining whether a proposed project will produce benefits substantially in Oregon, pursuant to OAR 123-011-0025(5)(b).

(f) Prior to determining that an Economic Development Project is an Eligible Project, the Finance Committee shall:

(A) Determine that the action is cost effective, considering both major public expenses and major public benefits, unless the Economic Development Project involves an Exempt Facility;

(B) Find that the project involved is consistent with the Department's comprehensive policy and programs;

(C) Find that the project will produce goods or services which are sold in markets for which national or international competition exists, unless the Economic Development Project involves an Exempt Facility;

(D) Determine that, if the project is to be constructed and operated by a Non-profit Entity, the project will not compete significantly with local for-profit businesses;

(E) Determine that the action is the best use of the moneys involved, considering other pending applications for those moneys; and

(F) Provide for public notice of, and public comment on, the action. The public hearing is not a contested case hearing. Members of the public are invited to present written or oral testimony. Only Finance Committee members and department staff will ask questions.

(G) Notify a senior official (such as mayor or city manager) of the city or county (if in unincorporated county property) in which the project will be located about the project and the potential use of Economic Development Revenue Bonds.

(g) The Finance Committee may deny an application if the Applicant does not demonstrate, to the satisfaction of the Finance Committee, that the project is financially feasible. When bond proceeds for an Economic Development Project are to be used for research and development costs or operating expenses, the determination of financial feasibility may include one or more of the following criterion:

(A) The adequacy of long-term equity investment in the project;

(B) Collateral value of assets as supported by appraisals; or

(h) The Finance Committee may deny an application if the Applicant (or any of the principals in the Applicant) is subject to any existing, pending or threatened litigation or unasserted claim, unless such litigation or claim is fully disclosed to the Finance Committee and the arrangements for the settlement thereof are acceptable to the Finance Committee. In any case where such litigation or claim is unknown to the Finance Committee at the time project eligibility is granted or if such litigation or claim arises subsequent to a grant of project eligibility, the Finance Committee may rescind the project eligibility;

(i) The Finance Committee may make any reasonable requirement of the Applicant related to the administration of the Oregon Economic Development Revenue Bond Program, including requirements that would survive closing and be enforceable for the term of the Bond.

(j) If Bond proceeds for an Economic Development Project are to be used for research and development costs or operating expenses, the Finance Committee may require, regardless of the method of sale, that the proposed Bond issuance receive an investment grade rating from a nationally recognized rating agency (Moody’s Investors Service, Fitch Ratings or Stand and Poor’s Corporation) or receive an equivalent rating through the use of credit enhancement. However, the investment grade rating requirement may be waived for Applicants who are listed on the New York Stock Exchange (NYSE) or the National Association of Securities Dealers Exchange (NASDAQ).

(k) If Bond proceeds for an Economic Development Project are to be used for research and development costs or operating expenses and research and development costs and operating expenses total more than 5% of the total amount of the Bonds, the Finance Committee shall approve the investment bankers, remarketing agents, and other finance team professionals, in addition to the approvals from Oregon State Treasury.

(l) If Bond proceeds for an Economic Development Project are to be used for research and development costs or operating expenses, the Finance Committee may impose requirements on the resale of the Bonds.

(3) The Finance Committee shall issue a Resolution for Project Eligibility for each economic development project determined to be an eligible project. The term of eligibility shall last 12 months unless extended by the department or the Finance Committee.

(4) Administrative rules in effect at the time the Finance Committee determines a project to be eligible shall continue to govern the project until the bonds have been redeemed, notwithstanding any contrary provision in any subsequently adopted administrative rule.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 8-2024, amend filed 05/06/2024, effective 05/06/2024
OBDD 4-2024, temporary amend filed 03/11/2024, effective 03/11/2024 through 09/06/2024
OBDD 8-2018, minor correction filed 02/16/2018, effective 02/16/2018
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 7-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 9-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 4-2005, f. & cert. ef. 5-5-05
EDD 9-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
Reverted to EDD 4-1995, f. 4-28-95, cert. ef. 5-3-95
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 4-1995, f. 4-28-95, cert. ef. 5-3-95
EDD 14-1994(Temp), f. & cert. ef. 11-10-94
EDD 13-1990, f. & cert. ef. 6-7-90
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988(Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 1-1986, f. 1-28-86, ef. 2-1-86
EDD 6-1985(Temp), f. & ef. 10-22-85
EDD 5-1985(Temp), f. & ef. 10-4-85
EDD 3-1985, f. & ef. 6-28-85
EDD 1-1985(Temp), f. & ef. 2-26-85
EDD 8-1984(Temp), f. 12-31-84, ef. 1-1-85

Or. Admin. R. 123-011-0037 Approval of Bond Closing Resolution

Prior to the approval of bond financing for an eligible project, as evidenced by the Commission’s approval of a bond closing resolution, the Commission shall:

(1) Determine that the project satisfies the applicable requirements of OAR chapter 123, division 8 (compliance with local land use planning requirements), as evidenced by documentation to be provided by the city or county (if in unincorporated county property) in which the project is located.

(2) Determine that the project involved is consistent with applicable adopted local economic development plans, as evidenced by documentation from the city or county.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 – 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 9-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08

Or. Admin. R. 123-011-0040 Extension

(1) The Department may extend the eligibility granted by the Finance Committee for up to six months if the Department determines that the project still constitutes an eligible activity and that there is a reasonable prospect of the Bonds being issued within the six-month extension period. The Applicant must provide updated financial information, and a project status report to the Department, in a form approved by the Department, at least 14 calendar days before eligibility expires. The Department may waive the 14 calendar day requirement at its sole discretion.

(2) The Finance Committee may extend eligibility if the Department denies extended eligibility or if the initial extension granted by the Department under section (1) of this rule has expired. The Finance Committee must determine that the project still constitutes an eligible activity, and that there is a reasonable prospect of the Bonds being issued within the extension period. The Applicant must provide updated financial information and a project status report, as well as a request for extension, in a form approved by the Department, at least one month prior to the expiration date of the original or extended eligibility period. The Finance Committee may waive this time period at its sole discretion.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 11-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 9-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 4-2005, f. & cert. ef. 5-5-05
EDD 9-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988(Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 1-1986, f. 1-28-86, ef. 2-1-86
EDD 3-1985, f. & ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, ef. 1-1-85

Or. Admin. R. 123-011-0045 Fees

Applicants shall pay the Department and the Commission’s bond counsel the following fees and expenses:

(1) For a new money Bond which is not a refunding, modification, restructuring, or reissuance:

(a) Applicant shall pay to the Department a non-refundable application fee of $500 that shall accompany the application, unless the project is an Exempt Facility solid waste disposal waste-to-energy project. If the project is an Exempt Facility solid waste disposal waste-to-energy project, the Applicant shall pay to the Department a non-refundable application fee of $2,500 that shall accompany the application. If an Exempt Facility solid waste disposal waste-to-energy Bond closes, $2,000 shall be credited towards the total closing fee due at closing.

(b) For Bonds to be issued for Exempt Facility solid waste disposal waste-to-energy projects, the Applicant shall pay to the Department a fee of up to the greater of $10,000 or 1/10 of one percent (0.1%) of the total Bonds proposed to be issued for the project up to a maximum amount of $50,000. The fee shall accompany the request for approval of a Resolution for Project Eligibility or the request for approval of an extension of a Resolution for Project Eligibility; provided, however, that if the request is for an extension of a Resolution for Project Eligibility, the fee shall be calculated based only on the increase, if any, from the amount of the Bonds approved in the pending Resolution to the amount of the Bonds sought in the request for the Resolution’s extension. If the Resolution for Project Eligibility is not approved, this fee, in whole or part, may be refunded at the Department’s sole discretion. If the Resolution for Project Eligibility is approved, this fee will not be refunded but if the Bond closes, it shall be credited towards the total bond closing fee due at closing.

(c) If the Department brings a request for current year or carry forward allocation to the Private Activity Bond Committee (PABC), the Applicant benefiting from the allocation request shall pay the Department a fee of 1/10 of one percent (0.1%) of the PABC allocation requested, up to a maximum amount of $10,000, for each such request. If the Applicant’s request to PABC is denied, in whole or part, the Department may refund this fee, in whole or part, at its sole discretion. If the Bonds close, this fee shall be credited towards the total closing fee due at closing. This fee is in addition to any fees charged directly by PABC.

(d) For Bond issues which are not issued under the Oregon Express Bond Program, the Applicant shall pay to the Department at the time of initial Bond closing a closing fee which equals ½ of one percent (0.5%) of the total amount of bond proceeds (par plus premium or minus discount) from Bonds issued for the project for the first $10,000,000 in bond proceeds plus ¼ of one percent (0.25%) of proceeds in excess of $10,000,000. When bonds are issued in more than one series for an eligible project, this bond closing fee shall be applied to the total amount of bond proceeds from all series.

(e) For the Oregon Express Bond Program, the Applicant shall pay to the Department at the time of initial Bond closing a closing fee of ¼ of one percent (0.25%) of the total Bond issuance for the project, regardless of the total amount of Bonds. When bonds are issued in more than one series for an eligible project, this bond closing fee shall be applied to the total amount of Bonds from all series.

(f) The total closing fee due at closing shall be adjusted by the credits described in OAR 123-011-0045(1) (a) – (c).

(g) The fees imposed by OAR 123-011-0045(1)(a)–(e) shall apply to both tax-exempt and taxable bonds.

(h) Before the Finance Committee or Department acts on a Declaration of Intent or Resolution for Project Eligibility and before the Department or Finance Committee acts on a request for new money Bonds, an Applicant shall agree in writing to pay all fees described in this Rule.

(2) For a current refunding of an outstanding Bond:

(a) The Applicant shall pay to the Department a non-refundable processing fee of $500 that shall accompany the request for the refunding.

(b) The Department may charge the Applicant a closing fee of up to 1/10 of one percent (0.1%) of the amount of the total bond proceeds from the refunding or bond proceeds for any additional Bonds issued under a single project eligibility. This closing fee may be waived for any refunding Bond issued within 18 months of the closing date of the Bond issue to be refunded.

(c) Before the Department or Finance Committee acts on a request for a refunding of existing Bonds, an Applicant shall agree in writing to pay all fees described in this Rule.

(3) For the modification, restructuring, or reissuance of existing Bonds:

(a) The Applicant shall pay to the Department a non-refundable processing fee of $1,000 that shall accompany the request for approval of the modification, restructuring, or reissuance.

(b) The Department may charge the Applicant a closing fee of up to 1/10 of one percent (0.1%) of the total bond proceeds from the modified, restructured, or reissued Bonds.

(c) Before the Department or Finance Committee acts on a request for a modification, restructuring, or reissuance of existing Bonds, an Applicant shall agree in writing to pay all fees described in this Rule.

(4) The Department may charge any out-of-pocket expenses, including but not limited to legal expenses, incurred by the Department for processing any Bond request. The Department may charge an estimation of these expenses in advance of the scheduled Bond closing. Any overpayments for estimated out-of-pocket expenses will be credited to the applicant at Bond closing. Applicants shall agree in writing, before Finance Committee acts on a Declaration of Intent or a Resolution for Project Eligibility, to pay any out-of-pocket expenses incurred by the Department for processing any Bond request whether or not the Bonds close.

(5) The Commission may collect the above fees and expense reimbursements from an Applicant that seeks to have an Economic Development Project declared eligible for financing before the project is determined to be eligible for financing.

(6) Applicants or beneficiaries of Bond financing shall pay directly, and remain current with their payment obligations, for legal fees or expenses payable to the Commission’s bond counsel related to issuance, refunding, modifications, restructuring or reissuance of Bonds through the Commission.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.326
OBDD 14-2019, amend filed 10/04/2019, effective 10/04/2019
OBDD 10-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 5-2012, f. & cert. ef. 6-1-12
OBDD 7-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 20-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 9-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
EDD 9-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 4-2005, f. & cert. ef. 5-5-05
Administrative correction 11-29-02
EDD 10-2001(Temp), f. & cert. ef. 12-13-01 thru 6-1-02
Administrative correction 6-14-01
EDD 14-2000(Temp), f. & cert. ef. 12-14-00 thru 6-12-01
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 10-1996(Temp), f. & cert. ef. 12-4-96
EDD 15-1994, f. & cert. ef. 11-10-94
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988 (Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 3-1985, f. & cert. ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, cert. ef. 1-1-85

Or. Admin. R. 123-011-0050 Confidential Records

(1) Upon written request and within a reasonable time, the Director or his designee shall provide program records, for inspection in accordance with ORS Chapter 192.

(2) The person requesting records will be charged for preparing and mailing such records. Costs may include but not be limited to costs incurred in locating records, separating exempt and nonexempt records, having a custodian present during the inspection, preparing lists of data, making photocopies and telefaxing materials. Fees to be collected shall be set forth in the Department's schedule of fees and may be amended from time to time as the Department may determine.

(3) Except as otherwise provided in ORS 192.410-192.595, records exempt from disclosure include but are not limited to:

(a) Reports and analyses of reports which bear on the Applicant's character, finances, management ability and reliability, and which were obtained in confidence from persons or firms not required by law to submit them and the Department has obliged itself in good faith not to disclose the information;

(b) Financial statements, tax returns, business records, employment history and other personal data submitted by or for Applicants, or analysis of such data;

(d) Formulas, plans, designs and related information that constitute trade secrets under ORS Chapter 192;

(e) Personal financial statement;

(f) Financial statements of Applicants;

(g) Customer lists;

(h) Information of an Applicant pertaining to litigation to which the Applicant is a party if the complaint has been filed, or if the complaint has not been filed, if the Applicant shows that such litigation is reasonably likely to occur. This exemption does not apply to concluded litigation and nothing in this section shall limit any right or opportunity granted by law to a party involved in litigation;

(i) Production, sales or cost data; and

(j) Marketing strategy information that relates to an Applicant's plan to address specific markets and Applicant's strategy regarding specific competitors.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B.320 - 285B.371
OBDD 5-2012, f. & cert. ef. 6-1-12
EDD 4-2005, f. & cert. ef. 5-5-05
EDD 10-1999, f. & cert. ef. 10-11-99
EDD 2-1999(Temp), f. & cert. ef. 3-18-99 thru 9-14-99
EDD 36-1988, f. & cert. ef. 12-15-88
EDD 15-1988, f. & cert. ef. 5-24-88
EDD 9-1988 (Temp), f. & cert. ef. 3-18-88
EDD 6-1988(Temp), f. & cert. ef. 2-29-88
EDD 4-1988, f. & cert. ef. 2-10-88
EDD 3-1985, f. & cert. ef. 6-28-85
EDD 8-1984(Temp), f. 12-31-84, cert. ef. 1-1-85

Or. Admin. R. 123-011-0055 Policies and Procedures for Identification of State’s Bond Counsel for Economic Development Revenue Bonds

(1) Pursuant to ORS 286A.130(1): “The State Treasurer or a related agency may enter into one or more agreements for bond counsel services for a period of not less than one year during any biennium in which there are bonds outstanding that were issued for the state agency or during any biennium in which the state agency expects the State Treasurer to issue bonds for an agency program. A state agency may not enter into an agreement for bond counsel services unless the State Treasurer and the Attorney General have reviewed and approved the terms and conditions of the agreement.”

(2) In addition, pursuant to ORS 286A.130(4), the Department or the Treasurer may appoint bond counsel “by letter, certificate or otherwise” to provide bond counsel services “for an individual conduit revenue bond sale.”

The Oregon State Treasurer has adopted an administrative rule to address the appointment of bond counsel for the Department’s Economic Development Revenue Bonds.

While the law and rule allows for the Department to select an alternate bond counsel, the Department shall give preference to the contracted bond counsel selected through the public solicitation process, unless alternate bond counsel is accepted by the Department as outlined below. In order for the Department to consider alternate counsel, the following conditions must be satisfied:

(a) Prior to submitting the application, the borrower must notify the Department in writing of the desire to use alternate counsel.

(b) The alternate counsel must meet all of the conditions outlined in OAR 170-061-0100. These conditions include, but are not limited to, the alternate counsel agreeing and representing to Treasury and the Department that it has been engaged as counsel to the State of Oregon, who is its client, and that the firm will represent solely the interests of the State of Oregon in connection with the Economic Development Revenue Bond issuance.

(c) The Department must consent to the change in counsel and obtain the approval of the Oregon State Treasurer and the Attorney General for the State of Oregon.

(d) If there are any potential conflicts of interest, a no conflict waiver must be approved to the satisfaction of the Department, Treasurer and Attorney General.

(e) After approval by the Department and receiving written approval from Treasurer and Attorney General, the Department shall send a Letter of Appointment to the alternate counsel and alternate counsel must mutually agree in writing to the terms and conditions of representation.

(3) Final selection of bond counsel is made at the sole discretion of the Department and any requests submitted after receipt of an application for bond financing may or may not be considered by the Department at its sole discretion.

(4) For the Oregon Express Bond Program, the Department will use and base any negotiations about documents on the current Express Bond documents approved and being used by the Department.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B320 - 285B.371
OBDD 10-2018, adopt filed 04/17/2018, effective 04/17/2018

Division 15 INNOVATION INFRASTRUCTURE

Or. Admin. R. 123-015-0100 Purpose

The following rules are for the purpose of assisting technology-based, start-up businesses in Oregon whose primary purpose is to commercialize university-based or university-assisted research with the University of Oregon, Oregon State University and the Oregon Solutions Network to increase the number of, and ensure the retention of, such businesses within Lane, Linn and Benton counties.

History

Statutory/Other Authority: OL 2013 & ch. 762
Statutes/Other Implemented: OL 2013 & ch. 762
OBDD 4-2014, f. & cert. ef. 4-1-14

Or. Admin. R. 123-015-0200 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. The following terms shall have the following definitions, unless the context clearly indicates otherwise:

(1) “Grantee” means University of Oregon, Oregon State University and the Oregon Solutions Network within Lane, Linn and Benton counties.

(2) “Oregon Solutions Network” means the Oregon Solutions Network established pursuant to Executive Order 11-12 dated December 16, 2011.

History

Statutory/Other Authority: OL 2013 & ch. 762
Statutes/Other Implemented: OL 2013 & ch. 762
OBDD 4-2014, f. & cert. ef. 4-1-14

Or. Admin. R. 123-015-0300 Performance Based Contracts

(1) The department shall enter into performance based contracts and agreements with the University of Oregon, Oregon State University and the Oregon Solutions Network in Lane, Linn and Benton counties.

(2) Performance based contracts and agreements implement and accomplish the following:

(a) Providing financial assistance to programs, entities and providers of technical business development and creation assistance and providing support to technology-based start-up businesses whose primary purpose is to commercialize university-based or university-assisted research;

(b) Identifying and recruiting entrepreneurial talent, qualified investors and other sources of capital;

(c) Acquiring, procuring, furnishing or improving facilities in or near Lane, Linn or Benton counties, as identified by the University of Oregon, Oregon State university and the Oregon Solutions Network, for the operation or support of businesses, receiving assistance under this section, signature research centers and other businesses, programs and entities involved in the commercialization of university-based or university-assisted research;

(d) Establishing, connecting or expanding support programs, directly or indirectly, that provide assistance to technology-based, start-up businesses whose primary purpose is to commercialize university-based or university-assisted research within and outside the region.

History

Statutory/Other Authority: OL 2013 & ch. 762
Statutes/Other Implemented: OL 2013 & ch. 762
OBDD 4-2014, f. & cert. ef. 4-1-14

Or. Admin. R. 123-015-0400 Administration

The department is responsible for disbursement of funds to entities per legislative designation consistent with OL 2013, ch. 762 and that funds are utilized for the purposes intended by the Legislature. The department will carry out those responsibilities with performance-based contracts that tie timed payments to successful completion of contractual tasks and an agreed-upon timeline.

History

Statutory/Other Authority: OL 2013 & ch. 762
Statutes/Other Implemented: OL 2013 & ch. 762
OBDD 4-2014, f. & cert. ef. 4-1-14

Or. Admin. R. 123-015-0500 Reporting

Grantees are required to report to the department on a quarterly basis on progress made in meeting all obligations set forth in the performance based contracts and agreements.

History

Statutory/Other Authority: OL 2013 & ch. 762
Statutes/Other Implemented: OL 2013 & ch. 762
OBDD 4-2014, f. & cert. ef. 4-1-14

Division 16 BUSINESS RETENTION FUND

Or. Admin. R. 123-016-0000 Purpose

The purpose of these rules is to provide procedures, standards and criteria for the making of Oregon Business Development Commission expenditures for feasibility studies, technical assistance and management consulting services from the Business Retention Fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
OBDD 12-2010, f. 4-30-10, cert. ef. 5-1-10
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87
EDD 10-1985(Temp), f. 11-7-85, ef. 10-22-85

Or. Admin. R. 123-016-0010 Definitions

(1) Business retention services means technical assistance provided by experts, as qualified by the department, focused on retaining the viable operation of an existing business in Oregon. The services include, but are not limited to the following types of assistance:

(a) Assessment — initial evaluation to determine the extent of issues experienced by the business and the likelihood of the business’s viability.

(b) Management consulting — identifying and solving problems including, but not limited to, management improvements, marketing problems, financial problems, equipment needs, productivity improvements, production control, cost and pricing systems, and/or ownership.

(c) Feasibility study — a study conducted to analyze the feasibility of reopening, keeping open, or converting a business firm or a facility to another product, identify ownership possibilities, including employee ownership, and conduct an appraisal of the facility's assets to be purchased.

(d) Conversion plan — a plan to convert a facility to a new product or enter a new market or convert a company's ownership structure, including an employee buy-out.

(e) Transition plan — strategic and business plans to grow or alter a business operation, including, but not limited to, mergers and transitions to local owners.

(f) Restructuring plan — plan for the acquisition of new equipment, technologies, management practices, sourcing solutions, and growth options focused on retaining the viable operation of an existing business in Oregon.

(g) Any other type of technical assistance necessary to retain a business in Oregon, maintain Oregon employees, or assist an Oregon business to manage growth that will lead to the creation of new jobs in Oregon.

(2) “Fund” means the Business Retention Fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
OBDD 12-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1998(Temp), f. & cert. ef. 3-6-98 thru 7-24-98
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87
EDD 10-1985(Temp), f. 11-7-85, ef. 10-22-85

Or. Admin. R. 123-016-0020 Eligibility

(1) Except as set forth in 123-016-0020(2), the following are eligible recipients of business retention services:

(a) A for-profit business firm, whose Oregon facility is:

(A) Engaged in:

(i) Technology manufacturing;

(ii) Wood and forest products processing;

(iii) Clean technologies;

(iv) Outdoor gear or active wear production;

(v) Agriculture or aquaculture development;

(vi) Food or seafood processing;

(vii) Other advanced manufacturing; or

(viii) producing goods or services and competing in markets for which regional, national or international competition exists; and

(B) Experiencing at least one of the following issues: Declining employment, declining sales, declining profits, or an erosion of working capital, that is likely to lead to major employee layoffs or closure of the business, or an emerging industry or part of an industry cluster with high potential for market growth, job retention and job creation.

(b) A public or non-profit, private entity which:

(A) has as one of its primary purposes, as stated in its articles of incorporation, charter or bylaws, the promotion of economic development in Oregon; and

(B) Is requesting business retention services for an industrial facility in Oregon which is actually closed or houses a business which has announced its closure.

(2) Business retention services shall not be used to relocate a business from one labor market in Oregon to another.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
OBDD 12-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87

Or. Admin. R. 123-016-0030 Awards of Grants and Loans; Match Requirements

(1) A business firm described in OAR 123-016-0020(1)(a) is eligible for a maximum award of $25,000 from the Fund for business retention services.

(2) A public or non-profit, private entity described in OAR 123-016-0020(1)(b) is eligible for a maximum grant of $30,000 from the Fund for business retention services. A public or non-profit, private entity recipient will be required to contribute a minimum of 25 percent of cost of the business retention services in cash.

(3) As provided in OAR 123-016-0050, an award from the Fund may be required to be repaid, in whole or in part, if certain conditions are met.

(4) In most instances, the department will first approve an award from the Fund to conduct an assessment to determine what, if any, additional business retention services are likely to result in retaining the viable operation of an existing business in Oregon.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
OBDD 5-2025, amend filed 06/02/2025, effective 06/02/2025
OBDD 12-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87
EDD 10-1985(Temp), f. 11-7-85, ef. 10-22-85

Or. Admin. R. 123-016-0040 Application and Award Approval

(1) An eligible recipient, as listed in 123-016-0020(1), shall make application for business retention services to the department on a form prescribed and provided by the department.

(2) All applications shall be reviewed by the department. The department may also designate an advisory committee to review applications and make recommendations to the department.

(3) The department may request any additional information, such as an assessment or an appraisal, or may recommend a modification to the application in order to make a final determination on an award for business retention services from the Fund.

(4) Prior to making an award from the Fund for a for-profit business firm described in OAR 123-016-0020, the department will make a determination that business retention services are likely to result in retaining a viable operation.

(5) Prior to making an award from the Fund for a closed facility or for a facility that houses a business which has announced its closure, the department must determine:

(a) There is a reasonable probability of restarting or converting the facility; and

(b) The business retention services will include consideration of reemploying or continuing the employment of that facility's former or existing labor force.

(6) In making a determination on an award from the Fund, the department shall give preference to businesses, facilities that are closed, or facilities housing businesses which have announced their closure which are located in a distressed area as designated under OAR 123-024.

(7) The department shall either approve or deny an application.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87
EDD 10-1985(Temp), f. 11-7-85, ef. 10-22-85

Or. Admin. R. 123-016-0050 Contracts for Awards

(1) Upon approval of an award from the Fund, the department will enter into a contract with the recipient If the recipient is a for-profit business, the contract will require, among other items, repayment of the grant if the department has determined the business has the ability to repay the grant without jeopardizing the viability of the business. The department will make this determination based, in part, on a recommendation from the contracted expert.

(2) Upon approval of an award from the Fund, the department will determine the optimal method of delivering the business retention services to the recipient. In most instances, the department will identify an expert in the subject area in which the business is experiencing problems or an expert in the industry in which the business is engaged and enter into a contract with the expert for the provision of the business retention services.

(3) The department must ensure that costs for contractors are consistent with usual and customary rates and that contractors are certified, licensed, or otherwise experienced and qualified in their field.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87
EDD 10-1985(Temp), f. 11-7-85, ef. 10-22-85

Or. Admin. R. 123-016-0060 Confidential Records

For applicants and recipients of business retention services, ORS 192.502(17) lists certain types of business information that are exempted from public records requests.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.224 & 192.502(17)
OBDD 32-2010, f. & cert. ef. 10-1-10
EDD 12-2009, f. & cert. ef. 10-1-09
Reverted to EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 19-2008(Temp), f. 6-9-08 cert. ef. 6-10-08 thru 11-15-08
EDD 13-1988, f. 5-24-88 (and corrected 5-27-88), cert. ef. 5-27-88
EDD 4-1987(Temp), f. & ef. 10-1-87

Division 17 OPERATION OF OREGON BUSINESS DEVELOPMENT FUND

Or. Admin. R. 123-017-0005 Purpose

The purpose of these rules is to provide procedures, standards and criteria for the making of loans from the Oregon Business Development Fund.

History

Statutory/Other Authority: ORS 285A.110
Statutes/Other Implemented: ORS 285B.050 - 285B.098
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 1-1984, f. & ef. 1-5-84
EDD 2-1983(Temp), f. & ef. 5-25-83

Or. Admin. R. 123-017-0007 Policy and Set Asides

(1) It is the policy of the Business Development Commission, the Finance Committee and the Business Development Department to make loans from the Oregon Business Development Fund to qualified applicants without regard to race, color, creed, sex, age or national origin.

(2) Fifteen percent of the available money in the Fund shall be set aside for loans to emerging small enterprises that are located in or draw their work forces from within distressed areas.

(3) The Oregon Targeted Development Account is hereby established within the Oregon Business Development Fund to make loans in distressed areas. The Commission authorizes the Department to transfer from time to time up to $10 million into or out of the Oregon Targeted Development Account.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.050 - 285B.098
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & ef. 1-5-84

Or. Admin. R. 123-017-0008 Delegation

(1) Authority for the day-to-day operation of the fund, including approval of loans and projects, and amendments thereto, is delegated to the Finance Committee.

(2) The Commission shall review and evaluate the operation of the fund with such frequency as it may from time to time determine, and may order any changes that it considers necessary or desirable.

(3) The Commission shall retain final authority over policies and administrative procedures governing the operation of the fund.

(4) The Director or designee is authorized to execute any document reasonably necessary or convenient to close any loan approved by the Finance Committee or, in the case of loans of $250,000 or less, by the Director.

(5) When applicable, the references to the Finance Committee shall include the Director, acting in regard to loans for business development projects of $250,000 or less pursuant to ORS 285B.080(3).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.050 - 285B.098
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 6-2001, f. & cert. ef. 10-9-01
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88

Or. Admin. R. 123-017-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) "Applicant" means any county, municipality, person or any combination of counties, municipalities or persons applying for a loan from the Oregon Business Development Fund under ORS 285B.050 to 285B.098.

(2)(a) "Business development project" means the acquisition, engineering, improvement, rehabilitation, construction, operation or maintenance of any property, real or personal, including working capital, that is used or is suitable for use by an economic enterprise and that will result in or will aid, promote or facilitate, the development of traded sector activities:

(b) Business development project" includes, but is not limited to, convention facilities, destination facilities, and office buildings, including corporate headquarters, and is a project that:

(A) Is in the traded sector, or supports traded sector activities, and is located in Oregon; or

(B) Is engaged in by a non-profit organization, will not compete with local for-profit businesses, and is located in Oregon. Projects engaged in by a non-profit organization need not be in the traded sector nor support traded sector activities.

(c) "Business development project" does not include shopping centers, food service facilities, or activities that are engaged in by retail and serve businesses that are not in the traded sector unless otherwise allowed under ORS 285B.059(5).

(3) "Fund" or "OBDF" means the Oregon Business Development Fund as defined and set forth in ORS 285B.050 – 285B.098.

(4) "Local Development Group" means any public or private corporation that has as one of its primary purposes, as stated in its articles of incorporation, charter or bylaws, the promotion of economic development in any part of the State of Oregon.

(5) "Municipality" means any city, municipal corporation or quasi-municipal corporation.

(6) "Person" means any individual, association of individuals, joint venture, partnership, limited liability company or corporation.

(7) "Emerging Small Business" means any business as defined in OAR 123-200-1600(3).

(8) "Convention center" means a facility for the holding of meetings, conferences, conventions, trade shows or similar gatherings. Sleeping accommodations may be included but at least one-third of the OBDF proceeds must be used for public meeting facilities. Such facilities must have the capacity to seat a minimum of 300 people. However, the Finance Committee, in its sole discretion, may approve financing for projects consisting solely or primarily of sleeping accommodations if the applicant sufficiently demonstrates that existing sleeping accommodations are inadequate for existing facility meeting space.

(9) "Destination facility" means a project which has a significant impact on the regional tourism economy and has the capacity to be marketed to national or international markets. Incidental food service facilities may be included. Sleeping accommodations without unique attraction capabilities are not eligible.

(10) “County” means any county or federally recognized Oregon Indian tribe.

(11) "Traded sector" has the meaning given that term in ORS 285B.280.

(12) "Traded sector activities" means activities that produce goods or services for the traded sector.

History

Statutory/Other Authority: ORS 285A.110
Statutes/Other Implemented: ORS 285B.050 & ORS 285B.092
OBDD 1-2022, minor correction filed 02/07/2022, effective 02/07/2022
OBDD 4-2019, minor correction filed 02/14/2019, effective 02/14/2019
OBDD 2-2018, amend filed 01/18/2018, effective 01/18/2018
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 4-1997, f. & cert. ef. 3-25-97
EDD 8-1996(Temp), f. & cert. ef. 8-13-96
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. 3-18-88
EDD 1-1984, f. & cert. ef. 1-5-84
EDD 2-1983(Temp), f. & cert. ef. 5-25-83

Or. Admin. R. 123-017-0015 Eligibility

(1) Eligible projects are business development projects as defined in OAR 123-017-0010(2). If the Department is unable to obtain a sufficient number of approvable applications to meet the requirements of ORS 285B.059(5), it may, notwithstanding the limitations imposed by 285B.050(2), make loans to service and retail businesses that qualify as Emerging Small Businesses which are located in or draw their workforces from within rural or distressed areas as determined by the Department, when such projects provide compelling economic development benefits. Under this section, service and retail businesses that qualify as Emerging Small Businesses need not be engaged in traded sector activities. The amount of loans the Department may make to service and retail businesses under (1) of this section shall be limited to the amount calculated under the method described in 285B.059(5).

(2) Eligible purposes are the financing of land, buildings, fixture, equipment and machinery, research and development, and the provision of working capital.

(3) Eligible applicants are defined in OAR 123-017-0010(1).

(4) The relocation of a facility from one labor market area to another, if not accompanied by an expansion of the applicant's business or employment, is an eligible activity if:

(a) The relocation is caused by forces beyond the control of the applicant; or

(b) The relocation is necessary for the continued operation of the business; or

(5) Relending of funds shall not be an eligible activity, except that the funds may be used for the local injection share of an SBA 503 or 504 Certified Development Company transaction.

(6) In cases where an otherwise eligible company or project has an insignificant (less than 25 percent) ineligible portion, the entire project may be determined eligible for a loan from the fund.

(7) Other than as specified in section (6) and (10) of this rule, Fund financing will be limited to 40 percent of the amount of the eligible costs, except that Fund financing may equal up to 50 percent of eligible costs when the application is submitted through or referral for financing is made to the Department by a Financial Institution.

(8) Tourist facilities shall not be eligible unless:

(a) The project can be qualified as a convention center; or

(b) The project can be qualified as a destination attraction with significant regional economic impact.

(9) Refinancing of existing debt, including existing trade payables and delinquent taxes, shall not be eligible unless the applicant demonstrates to the satisfaction of the Finance Committee that:

(a) The applicant contributes significantly to a target population or to a geographical area targeted by the Oregon Business Development Fund;

(b) The applicant requires refinancing to remain viable. Assessment of viability will be made at the sole discretion of the Finance Committee;

(c) Lenders agree to extend due dates, provide additional financing or provide other favorable terms to the applicant; and

(d) The applicant meets all other requirements set forth in statute and administrative rule, including demonstrating to the satisfaction of the Finance Committee that the project is feasible and a reasonable risk, has a reasonable prospect of repayment and can provide good and sufficient collateral.

(10) Except for the Oregon Targeted Development Account, Fund financing may exceed 50 percent of the amount of the eligible project costs and/or may be approved without a commitment from a commercial or private lender, or a local development group, to participate in the financing of the project, if

(a) Two or more Financial Institutions have denied a financing request for the project by the borrower. Such denied financing request must:

(A) Be for a loan for an eligible Fund loan purpose; and

(B) Be evidenced by a written denial from the Financial Institution specifying the reason(s) for the denial. Denial for reasons such as an incomplete application, failure to provide requested information, or the requested loan is for a purpose for which or on terms under which the Financial Institution does not make loans is not acceptable as a denial of financing; and

(b) The applicant certifies that there is no other available financing for the project with documentation as required by the Finance Committee.

(11) Fund financing may be approved without a commitment from a commercial or private lender or a local development group to participate in the financing of the project if the applicant is a county or municipality, or if there are required forms of payments other than scheduled principal and interest.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.059, 285B.080(3) & 285B.092
OBDD 2-2022, minor correction filed 02/07/2022, effective 02/07/2022
OBDD 2-2018, amend filed 01/18/2018, effective 01/18/2018
OBDD 6-2013, f. & cert. ef. 7-1-13
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 9-1997(Temp), f. & cert. ef. 10-7-97
EDD 8-1998, f. & cert. ef. 5-22-98
EDD 4-1997, f. & cert. ef. 3-25-97
EDD 8-1996(Temp), f. & cert. ef. 8-13-96
EDD 6-1991(Temp), f. & cert. ef. 6-18-91
EDD 29-1990, f. & cert. ef. 12-12-90
EDD 25-1990 (Temp), f. & cert. ef. 9-13-90
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & cert. ef. 1-5-84
EDD 2-1983(Temp), f. & cert. ef. 5-25-83

Or. Admin. R. 123-017-0020 Preference

(1) Except in the case of a loan made from the Oregon Targeted Development Account, the Finance Committee shall give preference to loan applications for projects that demonstrate an overall community benefit and that have one or more of the following characteristics:

(a) Have a ratio of at least one projected job created or saved per $30,000 sought to be borrowed from the Oregon Business Development Fund.

(b) Are operated by businesses with 100 or fewer employees;

(d) Are located in Enterprise Zones designated under ORS 285C.050 – 285C.250;

(e) Employ displaced workers in the area;

(f) Assist in the economic diversification of the area;

(g) Contain a significant amount of owner equity capital. At least ten percent of the project costs for established companies (three years old or more) and 30 percent of project costs for start-ups (firms less than three years old, or firms making the transition from research and development to production) should come from equity or subordinated loans from the owners;

(h) Maximize participation by financial institutions and local development groups;

(i) Produce goods or services for the export market;

(j) Encourage the flow of capital from outside the local area; and

(k) Do not cause severe adverse competitive disadvantages to existing businesses.

(2) The Finance Committee shall be the sole judge of the relative importance of each of the above factors for each individual loan application under consideration. Factors will not necessarily be assigned the same weights under all circumstances.

(3) In the case of a loan made from the Oregon Targeted Development Account, the Finance Committee will strive to fund projects that will create or save at least one job for every $20,000 of Oregon Business Development Fund investment.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.059 & 285B.092
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 2-1998(Temp), f. & cert. ef. 5-25-83
Reverted to EDD 5-1990, f. & cert. ef. 3-5-90
EDD 6-1991(Temp), f. & cert. ef. 6-18-91
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & cert. ef. 1-5-84

Or. Admin. R. 123-017-0025 Application Procedure

(1) It is the policy of the Finance Committee to strive for and encourage, throughout the application process:

(a) Maximum participation by financial institutions and local development groups; and

(b) A minimum administrative burden on the applicant and on the local government.

(2) Any applicant may submit an application to the Department on a form approved by the Department, together with an application fee.

(3) If the amount of the loan being sought from the Fund is $250,000 or less, the Director may in the Director's sole discretion approve or deny the loan request or forward it to the Finance Committee for the Committee's consideration.

(4) If the amount of the loan being sought from the fund exceeds $250,000 the Department shall make a recommendation to the Finance Committee, which may in its sole discretion approve or deny the loan request.

(5) If a loan request is approved, the Department shall prepare the documents necessary to close the loan transaction. Such documents shall reflect all terms and conditions upon which the Finance Committee or the Director may have conditioned approval of the loan. Any material modifications of those terms and conditions must be approved by the Chair of the Finance Committee or his/her designee, or the Director for loans of $250,000 or less.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.053 & 285B.092
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 37-1988, f. & cert. ef. 12-15-87
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & ef. 1-5-84
EDD 2-1983(Temp), f. & ef. 5-25-83

Or. Admin. R. 123-017-0030 Loan Conditions

(1) The Director (for loan requests of $250,000 or less) or the Finance Committee may approve a loan request if it finds that:

(a) Fund participation in any financing shall not exceed 40 percent of the total amount of the eligible project costs, except that Fund financing may be up to 50 percent when an application is submitted through a Financial institution or Fund financing may exceed 40 percent when two or more Financial Institutions have denied financing as outlined in OAR 123-017-0015(10).

(b) The proposed business development project is feasible and a reasonable risk from practical and economic standpoints, and the loan has reasonable prospect of repayment.

(c) The applicant can provide good and sufficient collateral for the loan, as determined by the Commission. The Commission's security interest may be subordinated to the security interest of other lenders participating in the project. The security interest of loans from the Oregon Targeted Development Account will not be subordinated to the security interest of other lenders, unless the Finance Committee or the Director finds there is an abundance of collateral and/or company or guarantor financial strength. The Business Development Commission may make loans in distressed areas, as defined by the Department, without regard to the requirements for security and collateral under ORS 285B.059 and 285B.062 that are otherwise applicable. Collateral value of out-of-state real property will be significantly discounted from nominal assessed or appraised value.

(d) Monies in the Oregon Business Development Fund are or will be available for the proposed business development project.

(e) There is a need for the proposed business development project.

(f) The applicant's financial resources are adequate to ensure success of the project.

(g) The applicant has not received or entered into a contract or contracts exceeding $2,000,000 with the Commission, under authority of ORS 285B.050–285B.098, for the previous 365 days.

(2) The Finance Committee may, in its sole discretion, permit the assumption of an outstanding Oregon Business Development Fund Loan, if the assuming obligor satisfies the Finance Committee or the Director as to its willingness and ability to perform all obligations of the original borrower related to the loan, including but not limited to the obligation to repay the loan in accordance with its terms, and if the State's collateral position is not diminished. Oregon Business Development Fund loans are not, however, necessarily or automatically assumable. A complete application, application fee and supporting documentation are required to initiate review of the request.

(3) The applicant and applicant’s project are, and will remain, compliant with all local, state and federal laws and regulations.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.059 & 285B.092
OBDD 5-2022, amend filed 05/05/2022, effective 05/05/2022
OBDD 1-2020, amend filed 02/07/2020, effective 02/07/2020
OBDD 6-2013, f. & cert. ef. 7-1-13
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 8-1998, f. & cert. ef. 5-22-98
Reverted to EDD 4-1997, f. & cert. ef. 3-25-97
EDD 9-1997(Temp), f. & cert. ef. 10-7-97
EDD 4-1997, f. & cert. ef. 3-25-97
Reverted to EDD 5-1990, f. & cert. ef. 3-5-90
EDD 8-1996(Temp), f. & cert. ef. 8-13-96
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & ef. 1-5-84
EDD 2-1983(Temp), f. & ef. 5-25-83

Or. Admin. R. 123-017-0035 Loan Agreement

If the Finance Committee approves the business development project, the Finance Committee or the Director, on behalf of the state, and the borrower may enter into a loan contract of not more than $2,000,000, secured by good and sufficient collateral (except as noted in OAR 123-017-0030(1)(c)), as determined by the Finance Committee, that shall set forth, among other matters:

(1) A plan for repayment by the borrower to the Oregon Business Development Fund moneys borrowed from the Fund used for the business development project with interest charged on those moneys at the fixed rate of one percentage point more than the prevailing interest rate on United States Treasury bills, notes or bonds of a comparable maturity. Loans made from the Oregon Targeted Development Account shall be made at a fixed interest rate of four percentage points less than the prevailing prime rate. Loans made under the conditions of OAR 123-0017-0015(10) shall be made at a fixed interest rate of not less than five percentage points over the prevailing prime rate. The rate on any loan shall not be less than four percent. For the purposes of this section, the prevailing interest rate shall be the last published daily interest rate as set forth in the most recent Federal Reserve Statistical Release H.15(519) that the Department has received at the time the loan is approved. The repayment plan, among other matters:

(a) Shall provide for commencement of repayment by the applicant of moneys used for the business development project and interest thereon no later than one year after the date of the loan contract or at such other time as the Finance Committee may provide;

(b) May provide for reasonable extension of the time for making any repayment in emergency or hardship circumstances if approved by the Finance Committee or the Director;

(c) Shall provide for such evidence of debt assurance of, and security for, repayment of the loan as is considered necessary by the Finance Committee;

(d) Shall set forth a schedule of payments and the period of loan which shall not exceed the usable life of the contracted project or 25 years from the date of the contract, whichever is less. The payment schedule shall include repayment of interest that accrues during any period of delay in repayment authorized by subsection (a) of this section, and the payment schedule may require payments of varying amounts for collection of accrued interest. The term of the Fund loan will normally be matched to, and not exceed twice that of, the commercial or private lender participating in the project, if applicable. Loans from the Oregon Targeted Development Account shall be for a maximum term of 5 years, with a maximum amortization of 15 years. Loans made under the terms of OAR 123-017-0015(10) shall be for a maximum term of 5 years, with a maximum amortization of 20 years.

(e) A request to renew any loan from the Fund that has reached its scheduled maturity and has not been repaid in full may be approved by the Finance Committee (or Director if the principal balance does not exceed $250,000), with any additional terms and conditions, including interest rate, that it may determine. A new application, including an application fee and supporting documentation, are required to initiate review of the request.

(f) Shall set forth a procedure for formal declaration of delinquency or default of payment by the Department. Loans shall be declared delinquent when any payment is more than ten days late. Borrower shall be notified in writing of declaration of delinquency, and shall have 31 days from the original payment date to bring the loan current. If the loan is not brought current, or arrangements satisfactory to the Department for bringing the loan current have not been made, the Department may declare the loan in default, declare the entire outstanding indebtedness to be forthwith due and payable and assign the loan to the Attorney General for collection; The Finance Committee or the Director or their designee is authorized to approve any modification of terms on a loan that is delinquent or in default as deemed necessary or prudent to most likely effect repayment of the loan to the Fund.

(2) Provisions satisfactory to the Department for field engineering and inspection, the Department to be the final judge of completion of the contract.

(3) That the liability of the state under the contract is contingent upon the availability of moneys in the Oregon Business Development Fund for use in the business development project.

(4) Such further provisions as the Finance Committee considers necessary to ensure expenditure of the funds for the purposes set forth in the approved application.

(5) That the borrower is responsible for payment of:

(a) All of the expenses of the operation and maintenance of the project, including adequate insurance;

(b) All taxes and special assessments levied with respect to the leased premises and payable during the term of the lease;

(c) Insurance premiums and providing insurance in amount and coverage acceptable to the Finance Committee. Such insurance shall include but shall not be limited to: fire and hazard insurance, liability insurance and flood insurance (if applicable); and

(d) Out-of-pocket costs associated with the loan closing which may include but are not limited to filing and recording fees, title insurance and appraisals, and attorney fees.

(6) That the borrower will provide to the Department on an annual basis, within 120 days of the end of its fiscal year, the same type of financial statements as required by the participating bank. The Finance Committee or the Department may require additional financial information.

(7) The Finance Committee, or Director for loans under $250,000, may require an assignment of life insurance on active principals in borrower.

(8) The Department, at its sole discretion, may require the execution of a Commitment Letter and receipt of a non-refundable Commitment Fee to secure resources necessary to fund the loan. The Commitment Fee will be applied at closing to the loan fee. If the loan does not close, the Commitment Fee will not be refunded.

(9) In the case of loans of more than $100,000 that are funded by proceeds from the Oregon Lottery, that the borrower shall make a good faith effort to hire and retain low-income individuals who have received job training assistance from publicly funded job training providers and enter into a first-source hiring agreement with a publicly funded job training provider.

(10) If the loan will result in the construction, expansion, rehabilitation or remodeling of a facility to which the public has access, adequate access for handicapped persons must be provided. This provision applies only to firms that deal directly with the general public in the normal and usual course of their business, and to facilities in which business is customarily transacted by and with members of the general public.

(11) If a project involves building construction, expansion, rehabilitation or modification, a loan from the fund shall be permanent and not interim financing.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.062 & 285B.092
OBDD 5-2022, amend filed 05/05/2022, effective 05/05/2022
OBDD 1-2020, amend filed 02/07/2020, effective 02/07/2020
OBDD 6-2013, f. & cert. ef. 7-1-13
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
OBDD 9-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 8-1998, f. & cert. ef. 5-22-98
EDD 9-1997(Temp), f. & cert. ef. 10-7-97
EDD 4-1997, f. & cert. ef. 3-25-97
EDD 8-1996(Temp), f. & cert. ef. 8-13-96
EDD 29-1990, f. & cert. ef. 12-12-90
EDD 25-1990(Temp), f. & cert. ef. 9-13-90
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 9-1989(Temp), f. & cert. ef. 11-3-89
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88
EDD 1-1984, f. & cert. ef. 1-5-84
EDD 2-1983(Temp), f. & cert. ef. 5-25-83

Or. Admin. R. 123-017-0037 Appeals, Servicing, Amendments, Assumptions and Modifications

(1) If the Director denies a loan request, the applicant may appeal the Director's decision to the Finance Committee. The Finance Committee may:

(a) Affirm the Director's denial; or

(b) Decide to consider the loan request itself.

(2) If the Finance Committee denies a loan request, the applicant has the right to appeal to the Finance Committee for a rehearing of its application.

(3) An applicant has the right to appear in person at the appeal hearing, and to introduce whatever books, documents and data it regards as necessary to support the appeal.

(4) An applicant whose appeal of the Director's or the Finance Committee's decision has been denied by the Finance Committee must submit a new application, including a new application fee, to be eligible for further consideration of a new loan request.

(5) All loans shall be monitored by, and all loan repayments shall be made to, the Department.

(6) It is the responsibility of the Borrower to ensure that the Department receives its payment by the due date.

(7) Any request for modification or amendment to any loan condition shall be made in writing to the Department and approved by the Finance Committee or Director. However, in those cases where a requested amendment or modification will not have a serious adverse effect on the State's security position, the Chairperson or his/her designee from the Finance Committee or the Director may approve such requested amendment or modification.

(8) If the Director, the Finance Committee, its Chairperson or designee, consents to any requested modification, assumption or amendment, the Borrower shall be responsible for all costs, including filing fees, of modifying or amending of any loan documents, filings, recordings or financing statements.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.059, 285B.062 & 285B.092
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 5-2005, f. & cert. ef. 5-11-05
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-18-88

Or. Admin. R. 123-017-0055 Fees and Charges

(1) The Department shall charge and collect a loan fee of $200 at the time the application is filed.

(2) In addition, the applicant, immediately upon receiving the loan proceeds, shall pay to the Department one and one-half percent of the principal amount of the loan.

(3) The Department may charge and collect a Commitment Fee, payable to the Department, in an amount up to three quarters of one percent of the principal amount of the loan to be applied to the fee specified in section (2) of this rule at closing of the loan. If the loan does not close, the Commitment Fee will not be refunded.

(4) The Department may charge and collect an Assumption Fee, payable to the Department, in an amount up to one half of one percent of the remaining principal balance of the loan. The individual or entity assuming the obligation will also be responsible for closing costs associated with the transfer of debt including but not limited to document preparation, review of documentation for legal sufficiency, title, escrow, recording or filing fees.

(5) The Department may charge and collect a Loan Modification Fee, payable to the Department, of $50 at the time of the modification request. A loan modification may include, but, is not limited to, modification to terms of repayment, subordination requests or collateral swaps. The individual or entity requesting the modification will also be responsible for costs associated with the modification including, but, not limited to, document preparation, review of documentation for legal sufficiency, title, escrow, recording or filing fees.

(6) Monies referred to in (1), (2), (3), (4) and (5) of this section shall be paid into the Fund.

(7) The Department may, in its sole discretion, use some or all of the money collected under section (2) of this rule, plus a maximum of an additional one and one-half percent, as payment to a contracted local development group for referring projects for financing, packaging the loans, processing applications, investigating proposed business development projects and servicing outstanding loans. In no case shall the Department make any payment of more than $15,000 for any one project. In no case shall the Department make any payment to any third party until the loan has been closed and the Department has collected the fee specified in section (2) of this rule.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.056, 285B.068 & 285B.092
OBDD 15-2024, amend filed 07/01/2024, effective 07/01/2024
OBDD 10-2024, temporary amend filed 05/16/2024, effective 05/16/2024 through 11/11/2024
OBDD 6-2013, f. & cert. ef. 7-1-13
OBDD 33-2010, f. & cert. ef. 10-1-10
OBDD 20-2010(Temp), f. & cert. ef. 5-28-10 thru 10-9-10
EDD 22-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 21-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 3-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 6-2001, f. & cert. ef. 10-9-01
EDD 6-2007(Temp), f & cert. ef. 8-29-07 thru 2-23-08
EDD 6-2001, f. & cert. ef. 10-9-01
EDD 11-1999, f. & cert. ef. 10-11-99
EDD 5-1990, f. & cert. ef. 3-5-90
EDD 37-1988, f. & cert. ef. 12-15-88
EDD 10-1988, f. & cert. ef. 3-13-88
EDD 1-1984, f. & ef. 1-5-84
EDD 2-1983(Temp), f. & ef. 5-25-83

Division 18 CAPITAL ACCESS PROGRAM

Or. Admin. R. 123-018-0000 Purpose and Scope

(1) The purpose of this division of administrative rules is to provide definitions, procedures, standards and criteria, to establish eligibility, and to stipulate rights and obligations for operation of the Capital Access Program.

(2) The Capital Access Program assists small businesses needing financial capital to grow and to undertake economic activity in this state by subsidizing loss reserves so that conventional lending institutions have greater capacity to satisfy this need.

History

Statutory/Other Authority: ORS 183.310 - 183.540 & ORS 285B.109-285B119
Statutes/Other Implemented: ORS 285B.109-285B119
OBDD 19-2019, minor correction filed 12/16/2019, effective 12/16/2019
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001 as used in this division of administrative rules, the following definitions apply, unless the context requires otherwise:

(1) "Agreement" means a contract between a Financial Institution and the Department authorizing the Financial Institution to participate in the Program as required under ORS 285B.113.

(2) "Borrower" means a Qualified Business, including but not limited to a corporation, partnership, limited liability company, joint venture, sole proprietorship, cooperative, or non-profit corporation, that has received a Qualified Loan from a Participating Financial Institution. The borrower, or any principal of the borrower, may not be an executive officer, director, or principal shareholder of the financial institution lender; a member of the immediate family of such executive officer, director or principal shareholder; or a related interest to any of the above. The terms “executive officer”, “director”, “principal shareholder”, “immediate family”, and “related interest” are described in 12 C.F.R. part 215.

(3) "Brownfield" means any real property where expansion or redevelopment is complicated by actual or perceived environmental contamination.

(4) "Department" means the State of Oregon Business Development Department under ORS Chapter 285A.

(5) "Distressed Area" means a geographic area so designated as described in division 024 of these administrative rules.

(6) "Enrolled Loan" means a Qualified Loan enrolled in the Program as described in OAR 123-018-0080, including but not limited to a term loan or line of credit.

(7) "Environmental action” on a brownfield(s) means activities undertaken to:

(a) Determine if a release has occurred, or may occur, if the release or potential release poses a significant threat to human health or the environment, or if additional remedial actions may be required at the site;

(b) Conduct a remedial investigation and a feasibility study;

(d) Conduct a remedial action or removal action at a site.

(8) "Fund" means the Capital Access Fund in the State Treasury under ORS 285B.109.

(9) "Loss" means any principal amount due and not paid, accrued interest due and not paid, and actual and necessary, documented out-of-pocket collection expenses at the time the Participating Financial Institution determines, in a manner consistent with its standard lending and loan loss criteria and normal method for making such determinations, that an Enrolled Loan is uncollectible and is to be charged off as a loss. The amount of principal and interest included in the Loss shall not exceed the principal amount of the Enrolled Loan, plus accrued and unpaid interest on covered principal amount from the date the Qualified Loan is made.

(10) "Loss Reserve Account" means an account in the State Treasury or any Financial Institution that is established and maintained by the Department for the benefit of a Financial Institution participating in Program.

(11) "Participating Financial Institution" means a Financial Institution that has executed an Agreement with the Department to participate in the Program, has enrolled one or more qualified loans, and has adequate capacity, as determined by the Department, to underwrite and monitor business-purpose loans.

(12) "Primary Economic Effect" means the majority of economic benefit resulting from a business activity. A business's Primary Economic Effect is in a particular geographic location if either at least 51 percent of the business's total revenues are generated, or at least 51 percent of the business's total jobs are created or retained, in that location.

(13) “Principal” in regards to a Borrower is defined as:

(a) If a sole proprietorship, the proprietor;

(b) If a partnership, each managing partner and each partner who is a natural person and holds a twenty percent (20%) or more ownership interest in the partnership; and

(c) If a corporation, limited liability company, association or a development company, each director, each of the five most highly compensated executives or officers of the entity, and each natural person who is a direct or indirect holder of twenty percent (20%) or more of the ownership stock or stock equivalent of the entity.

(14) “Principal” in regards to a Lender is defined as:

(a) If a sole proprietorship, the proprietor;

(b) If a partnership, each partner; and

(c) If a corporation, limited liability company, association or a development company, each director, each of the five most highly compensated executives, officers or employees of the entity, and each direct or indirect holder of twenty percent (20%) or more of the ownership stock or stock equivalent of the entity.

(15) "Program" means the Capital Access Program authorized by ORS 285B.109 to 285B.119.

(16) "Qualified Business" means any person, conducting business for profit or not for profit, which is authorized to conduct business in the State of Oregon.

(17) "Qualified Loan" means a loan or portion of a loan made by a Participating Financial Institution to a Qualified Business for any business activity that has its Primary Economic Effect in Oregon. The term does not include a loan or portion of a loan used for any of the following purposes:

(a) The purchase of owner-occupied residential housing or for the construction, improvement, or purchase of residential housing that is owned or to be owned by the Borrower;

(b) The purchase of real property that is intended for resale or not used for the business operations of the Borrower;

(c) Refinance of the balance of an existing loan that is not an Enrolled Loan. Any portion of the loan used for a qualified purpose (i.e., that is in excess of the balance of an existing loan that is not an Enrolled Loan) may be eligible to be enrolled.

(d) The purchase of securities;

(e) Lobbying activities;

(f) Repayment of delinquent federal or state income taxes unless the Borrower has a payment plan in place with the relevant taxing authority;

(g) Repayment of taxes held in trust or escrow;

(h) Reimbursement of funds owed to any owner, including any equity injection or injection of capital for the business’ continuance;

(i) Purchase of any portion of the ownership interest of any owner of the business; or

(j) Refinance of any portion of a loan enrolled in another state or federal credit enhancement or credit insurance program.

(k) The term also does not include a loan where any Principal of the Borrower has been convicted of a sex offense against a minor as such terms are defined in section 111 of the Sex Offender Registration and Notification Act (42 U.S.C. 16911).

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075, 285B.115(3) & 285B.117(4)
Statutes/Other Implemented: ORS 285B.109 - 285B.119
OBDD 6-2012, f. & cert. ef. 6-1-12
OBDD 9-2011(Temp), f. & cert. ef. 12-19-11 thru 6-15-12
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 9-1998, f. & cert. ef. 5-22-98
Reverted to EDD 9-1994, f. 5-27-94, cert. ef. 6-1-94
EDD 10-1997(Temp), f. & cert. ef. 10-7-97
EDD 9-1994, f. 5-27-94, cert. ef. 6-1-94
EDD 1-1994(Temp), f. & cert. ef. 1-11-94
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0020 Authority to Implement Program

The manager of the Department's Business Finance programs, or his/her designee, may execute any document reasonably necessary or convenient to implement the Program.

History

Statutory/Other Authority: ORS 285A.075 & 285B.113(3)
Statutes/Other Implemented: ORS 285B.109 - 285B.119
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0030 Program Registration Procedure

(1) A Financial Institution wishing to participate in the Program must submit a completed program registration application using a form prescribed by the Department.

(2) The Department shall determine the Financial Institution’s eligibility to participate in the Program, based on the submitted application and other information the Department may deem necessary or appropriate.

(3) A Financial Institution that the Department determines is eligible to participate in the Program may enter into an Agreement with the Department as described in OAR 123-018-0040.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.109 & 285B.119
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0040 Agreement

All Agreements entered into between a Participating Financial Institution and the Department shall provide:

(1) For the creation of a Loss Reserve Account by the Department, owned by the Department for the benefit of the Participating Financial Institution in accordance with ORS 285B.115;

(2) That the liability of the State of Oregon and the Department to the Participating Financial Institution under the Agreement is limited to the outstanding balance in the Loss Reserve Account for that Participating Financial Institution, less the portion of the interest that is available for withdrawal by the Department for administrative costs as described in OAR 123-018-0060;

(3) That the terms and conditions of Qualified Loans are to be determined solely by the Participating Financial Institution and Borrower;

(4) The method for enrolling Qualified Loans in the Program;

(5) That the Borrowers, the Participating Financial Institution, and (subject to the availability of money in the Fund) the Department will deposit moneys into the Participating Financial Institution's Loss Reserve Account when the Participating Financial Institution makes a Qualified Loan to a Borrower;

(6) A claims process for reimbursement of Losses that have been incurred from defaults on Enrolled Loans;

(7) For payment by the Department from the Loss Reserve Account to the Participating Financial Institution to reimburse it for such Losses, up to the total amount of the then current balance available in the Loss Reserve Account, less the portion of the earned interest that belongs to the department for administrative costs.

(8) For disposition of any recoveries from a Borrower made by the Participating Financial Institution subsequent to being reimbursed for any Loss by the Department;

(9) Conditions for subrogation of the Department, at the Department's request, to the rights of the Participating Financial Institution in collateral, personal guarantees or other forms of security for the Qualified Loan;

(10) Conditions for withdrawal by the Department of excess balances or of certain interest earnings (see OAR 123-018-0150) in the Loss Reserve Account;

(11) Conditions for termination by the Department of the obligation to enroll Qualified Loans under the Program;

(12) Conditions for termination of the Agreement, and disposition by the Department of any remaining balance in the Loss Reserve Account;

(13) For withdrawal by the Participating Financial Institution from the Program and disposition by the Department of any remaining balance in the Loss Reserve Account;

(14) For the Participating Financial Institution to periodically report to the Department any information the Department requires, including financial information that is identifiable with, or identifiable from, the financial records of a Borrower;

(15) For inspection by the Department of the Participating Financial Institution's pertinent files relating to Enrolled Loans;

(16) That the Department may require from the Participating Financial Institution information relating to the Participating Financial Institution's status and performance, as developed by or for applicable state or federal regulatory bodies, and relevant to the Participating Financial Institution's participation in the Program or the financial health of institution, or that the Department may obtain public information from state or federal regulatory bodies such as the Oregon State Department of Consumer and Business Services, Division of Finance and Corporate Securities; and

(17) For other terms and conditions as the Department may require.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.113, 285B.115, 285B.117 & 285B.118
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0050 Establishing a Loss Reserve Account

After executing an Agreement with a Participating Financial Institution, the Department shall establish a Loss Reserve Account to receive the fees described in OAR 123-018-0070 from the Borrower and the Participating Financial Institution, as well as the Department’s matching contribution from the Fund as described in OAR 123-018-0080 and 123-018-0085. Except as determined by the Department to be otherwise necessary or desirable, the Loss Reserve Account shall be domiciled with the Participating Financial Institution in the form of an insured, interest-earning demand deposit account.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.117
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0060 Ownership, Control, Investment of Loss Reserve Account

(1) All moneys in a Loss Reserve Account are the exclusive property of the State of Oregon, acting by and through the Department, and are controlled solely by the Department. The Department may withdraw funds from a Loss Reserve Account only as described in this division of administrative rules or as contained in provisions of the applicable Agreement.

(2) The Department may withdraw and transfer into the Capital Access Fund up to 50% of the interest earned on moneys in Loss Reserve Accounts to pay for administrative expenses incurred by the Department.

(3) Any earnings on the balance in a Loss Reserve Account are part of the Loss Reserve Account, except as described in this section and in OAR 123-018-0150.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.119
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0065 Loan Eligibility

A Participating Financial Institution may determine that a Qualified Loan is eligible for the Department to enroll in the Program if the Participating Financial Institution determines the Qualified Loan meets the following conditions:

(1) The Qualified Loan is not for a business enterprise in which a person described in section (2) of this section has a shared ownership, investment or other significant pecuniary interest; and

(2) The Qualified Loan is provided to a Borrower, who is not an executive officer, director or principal shareholder of the Participating Financial Institution, or person with comparable official capacity with or significant ownership in the Participating Financial Institution, or a member of the immediate family of such a person.

(3) The Borrower may not be:

(a) A business engaged in speculative activities that develop profits from fluctuations in price rather than through normal course of trade unless those activities are incidental to the regular activities of the business and part of a legitimate risk management strategy to guard against price fluctuations related to the regular activities of the business; or

(b) A business that earn more than half of its annual net revenue from lending activities; or

(c) A business engaged in pyramid sales, where a participant’s primary incentive is based on the sales made by an ever-increasing number of participants; or

(d) A business engaged in activities that are prohibited by federal law or applicable law in the jurisdiction where the business is located or conducted; or

(E) A business engaged in gambling enterprises, unless the business earns less than 33% of its annual net revenue from lottery sales.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.119
OBDD 6-2012, f. & cert. ef. 6-1-12
OBDD 9-2011(Temp), f. & cert. ef. 12-19-11 thru 6-15-12
EDD 8-2005, f. & cert. ef. 10-24-05

Or. Admin. R. 123-018-0070 Fees

(1) When making a Qualified Loan for which enrollment under the Program will be sought, the Participating Financial Institution shall charge the Borrower a fee that is at least 1.5 percent but not more than 3.5 percent of the principal amount of the Qualified Loan.

(2) The Participating Financial Institution shall pay a fee equal to the fee paid by the Borrower pursuant to section (1) of this rule. The Participating Financial Institution may charge the Borrower a fee to recover its contribution.

(3) These fees are non-refundable once the Qualified Loan is enrolled.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.117
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0080 Procedure for Enrollment of a Qualified Loan

(1) A Participating Financial Institution may enroll a Qualified Loan in the Program by taking the following actions:

(a) Notifying the Department in writing of the Qualified Loan to be enrolled, using a form prescribed by the Department, within 30 days after the date the Participating Financial Institution disburses proceeds of the Qualified Loan to the Borrower or the date the loan documents are fully executed and the Participating Financial Institution is obligated to disburse proceeds, whichever occurs sooner; and

(b) Transmitting to the Department the fees required by OAR 123-018-0070. If the Loss Reserve Account is domiciled with the Participating Financial Institution, the deposit of fees by the Participating Financial Institution into the Loss Reserve Account satisfies the requirements of this section if the Participating Financial Institution provides the Department with proof of deposit or written notification confirming the deposit.

(2) The Department shall, upon receipt of documentation and fees satisfying the requirements in section (1) of this rule, enroll the Qualified Loan if:

(a) The Department is satisfied that the Qualified Loan is eligible under OAR 123-018-0065; and

(b) Sufficient moneys are or can be made available from the Fund to meet the Department's minimum contribution obligation described in OAR 123-018-0085.

(3) The Department shall notify the Participating Financial Institution of enrollment within 10 business days from receipt of the required documentation and fees.

(4) After notifying the Participating Financial Institution that the Qualified Loan is enrolled, the Department shall transfer from the Fund to the Loss Reserve Account of the Participating Financial Institution a contribution amount as described in OAR 123-018-0085.

(5) Before making a Qualified Loan, a Participating Financial Institution may request a commitment from the Department that sufficient funds are available to meet the Department's contribution as described in OAR 123-018-0085 and are available to be transferred to the Loss Reserve Account when the Qualified Loan is enrolled. If the Department provides the commitment, it will be binding on the Department for 30 days after the date of the commitment if the Participating Financial Institution has complied with section (1) of this rule and the Qualified Loan is eligible under OAR 123-018-0065.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.117
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 9-1994, f. 5-27-94, cert. ef. 6-1-94
EDD 1-1994(Temp), f. & cert. ef. 1-11-94
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0085 State Contributions to Loss Reserve Accounts

The Department shall determine the amount of money it transfers from the Fund to a Loss Reserve Account as follows:

(1) For each Enrolled Loan, the Department shall deposit an amount equal to or greater than the total fees transmitted as described in OAR 123-018-0080(1)(b) and as required in 123-018-0070, subject to further limitations in this rule.

(2) If one or both of the following conditions exist, the Department shall deposit an amount equal to 200 percent of the minimum allowed by section (1) of this rule, except as otherwise restricted in section (4) of this rule:

(a) The Borrower's business operations that benefit from the Enrolled Loan are entirely located in a Distressed Area at the time that the Qualified Loan is made consistent with OAR 123-018-0080(1)(a); or

(b) The Enrolled Loan provides the Borrower with funding for use in an environmental action on a brownfield(s).

(3) For any Participating Financial Institution, the Department may deposit 200 percent of the minimum allowed by section (1) of this rule if the Loss Reserve Account currently contains less than $100,000 according to the most recent information provided to the Department at the time of loan enrollment.

(4) The Department may not transfer:

(a) An amount greater than $35,000 per Enrolled Loan and associated, concurrent transactions with related business interests; or

(b) More than a total of $150,000 from the Fund to a Loss Reserve Account for a single Qualified Business and related business interests.

(5) Unless otherwise provided in this rule, the Department may transfer up to 200 percent of the minimum described in section (1) of this rule, if the Department finds the Qualified Loan advances economic development or job creation in this state by small business.

History

Statutory/Other Authority: ORS 285A.075, 285B.115(3) & 285B.117(4)
Statutes/Other Implemented: ORS 285B.115 & 285B.117
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05

Or. Admin. R. 123-018-0090 Procedure for Making Claim for Reimbursement of Loss

(1) If a Participating Financial Institution charges off all or part of an Enrolled Loan as a result of a default by the Borrower, the Participating Financial Institution may claim reimbursement for all or part of the Loss incurred by notifying the Department of the claim in writing on a form prescribed by the Department within three calendar months of the date the Enrolled Loan was charged off.

(2) Subject to OAR 123-018-0110 to 123-018-0130, a Participating Financial Institution may make a claim for reimbursement of a Loss prior to the liquidation of collateral, or to realization on personal or other financial guarantees or from other sources.

(3) The Participating Financial Institution shall retain documentation in its files substantiating all claims for a term commensurate with standard banking records retention practices but not less than five years after the date that the Enrolled Loan is terminated.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.141
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0100 Payment of Claims by Department

(1) The Department shall reimburse a Participating Financial Institution for Losses claimed as described in OAR 123-018-0090. The Department may reject a claim only if the Department determines the representations and warranties provided by the Participating Financial Institution at the time of enrolling the Qualified Loan were false.

(2) All interest earnings shall be available to pay Loss claims, except for:

(a) Earnings available for withdrawal by the Department from the Loss Reserve Account, as described in OAR123-018-0060, and

(b) As provided for in OAR 123-018-0150.

(3) When there are insufficient funds in the Loss Reserve Account to cover the total amount of a Loss claim, the Department shall pay an amount equal to the balance of the Loss Reserve Account, less the Department’s share of any accumulated interest earnings on the account. This payment will fully satisfy the claim and the Participating Financial Institution will have no further right to receive any other amount with respect to such claim.

(4) The Department shall reimburse Loss claims in the order it receives them. If a Participating Financial Institution files two or more Loss claims simultaneously and there are insufficient funds in the Loss Reserve Account to pay them, the Participating Financial Institution may designate the order the Loss claims are to be paid by the Department.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115, 285B.1178 & 285B.118
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0110 Recoveries on Loans Subsequent to Payment of Claim

(1) If, subsequent to the payment of a Loss claim by the Department, the Participating Financial Institution recovers from the Borrower, through liquidation of collateral or from any other source, amounts for which Participating Financial Institution was reimbursed from the Loss Reserve Account, the Participating Financial Institution shall promptly repay into the Loss Reserve Account the amount received up to the amount of the reimbursement.

(2) If the Loss Reserve Account is domiciled with the Participating Financial Institution, the deposit to the Loss Reserve Account of the amount recovered from the Borrower by the Participating Financial Institution (with written notification by the Participating Financial Institution to the Department confirming such deposit) is deemed payment to the Department of the amount recovered from the Borrower by the Participating Financial Institution and shall satisfy the requirements of this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115, 285B.117 & 285B.118
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0120 Available Collateral, Guarantees and Other Security Not Realized

(1) After the Department has received a request to pay a Loss claim to the Participating Financial Institution from the Loss Reserve Account, as described in OAR 123-018-0100, and if requested by the Department, the Participating Financial Institution shall promptly provide the Department with all available information, including but not limited to, copies of documents related to all pledges or security against the Enrolled Loan, or payment of principle or interest thereon. Such pledges or security include, but are not limited to:

(a) Collateral, such as real estate, bonds and personal property assets;

(b) Duly recorded and perfected liens, certificates of title, deeds, UCC information and other documents representing security related to the collateral or other sources of payment; and

(c) Guarantees (personal or otherwise), warranties, insurance, letters of credit and other instruments from the Borrower, or a third party, supporting the Qualified Loan.

(2) When a Participating Financial Institution furnishes information pursuant to section (1), it shall identify:

(a) Whether the pledges or security remain outstanding or available for potential collection;

(b) If the pledges or security has been liquidated or realized to recover some or all of the Loss;

(d) The extent to which the lender has attempted to exercise its right to recover its Loss through that source.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.118
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0130 Subrogation

(1) The Department may request to be subrogated to the rights of a Participating Financial Institution to the pledges and security, pursuant to OAR 123-018-0120.

(2) The Department may make such a request if the Department believes that it would be able to take effective and proper action to more completely realize a return on the remaining available collateral or other sources of security, compared to the Lender, regardless of whether:

(a) The Lender has indicated its inability or unwillingness to take such action;

(b) Full or partial recovery of the Lender’s loss has occurred through reimbursement of the Loss claim by the Department or by combination of such reimbursement and by liquidation or realization of pledges and security.

(3) In response to such a request, the Lender shall promptly subrogate its rights to the Department, providing the Department with originals of all applicable documents, accompanied by enforceable assignments and conveyances to the Department.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.118
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0140 Reporting

(1) When a Loss Reserve Account is domiciled with the Participating Financial Institution, the Participating Financial Institution shall provide the Department with a monthly statement providing details of the balance and the payments and receipts activity in the Loss Reserve Account for the prior month.

(2) On or before January 15, April 15, July 15, and October 15 of each year, a Participating Financial Institution must file a quarterly report with the Department providing a complete list of Enrolled Loans and indicating the outstanding balance of each of its Enrolled Loans.

(3) When a Participating Financial Institution computes the aggregate outstanding balance of all its Enrolled Loans, it may only consider the balance of the portion of a loan enrolled in the Program.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115
OBDD 6-2012, f. & cert. ef. 6-1-12
OBDD 9-2011(Temp), f. & cert. ef. 12-19-11 thru 6-15-12
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0150 Withdrawal of Excess Deposits in Loss Reserve Accounts

Upon and after a formal determination or order by the Director of the Department:

(1) The following shall apply to all interest earnings on moneys transferred by the Department to match transmitted fees, as described in OAR 123-018-0085, for any loan enrolled after the date of Director's order:

(a) All Participating Financial Institutions shall continually remove such interest earnings from the Loss Reserve Account, paying the amount of such interest to the Department or sequestering them in a separate account;

(b) Such interest earnings shall not be available to cover any Loss, regardless of when they are effectively sequestered or transferred as described in this rule; and

(c) Such interest earnings shall be paid or transferred to the Department consistent with policies and directions of the Department, pursuant to the Director's determination; and

(2) Interest earnings arising from prior match funds or from any fee assessed on or paid by a Borrower or Lender shall remain in the Loss Reserve Account and available to cover Losses.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.119
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0160 Termination of and Withdrawal from Program

(1) The Department may terminate enrollment of Qualified Loans under the Program for a Participating Financial Institution on the date specified in the Department's notice of termination to the Participating Financial Institution, or for all Participating Financial Institutions under the Program upon 90 days notice, or such earlier date should the balance in the Fund reach zero, or should the Department anticipate that the balance in the Fund will reach zero. Termination shall not apply to any Qualified Loans made before the date of termination.

(2) Should a Loss Reserve Account have a zero balance, the Department may terminate the Agreement at its sole discretion.

(3) A Participating Financial Institution may withdraw from the Program after giving written notice to the Department. After receipt of this notice, the Department shall determine when to withdraw any remaining balance in the Participating Financial Institution's Loss Reserve Account.

(4) If a Participating Financial Institution is closed or taken over by the Federal Deposit Insurance Corporation (FDIC), with or without an Order to Cease and Desist issued by the FDIC and the Oregon Division of Finance and Corporate Securities, the Department shall terminate the failed Participating Financial Institution’s membership in the Program and all funds in the Loss Reserve Account shall be transferred to the Department. This provision shall apply whether or not a new financial institution purchases some or all of the loans of the failed Participating Financial Institution.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.119
OBDD 13-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 22-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 6-2008(Temp), f. & cert. ef. 3-4-08 thru 8-1-08
Reverted to EDD 8-2005, f. & cert. ef. 10-24-05
EDD 8-2007(Temp), f. & cert. ef. 9-4-07 thru 2-29-08
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0170 Disposition of Funds Withdrawals from Loss Reserve Accounts

The Department shall deposit moneys withdrawn by the Department from Loss Reserve Accounts as described in OAR 123-018-0040, 123-018-0150 and 123-018-0160 into the Fund.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.118
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0180 Inspection of Files

The Department may inspect a Participating Financial Institution’s files relating to Enrolled Loans at any time during normal business hours. The Department is not required to provide a Participating Financial Institution with prior notice of an inspection.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.113 & 285B.115
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0190 Reports of Regulatory Agencies

The Department may require from the Participating Financial Institution information relating to the Participating Financial Institution’s status and performance, as developed by or for applicable state or federal regulatory bodies, and relevant to the Participating Financial Institution’s participation in the Program or the financial health of institution, or the Department may obtain public information from state or federal regulatory bodies such as the Oregon State Department of Consumer and Business Services, Division of Finance and Corporate Securities. The Department shall not disclose any confidential information obtained as described in thus rule, to the extent permitted by law.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.113
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Or. Admin. R. 123-018-0200 Administrative Costs of Program

The Department may charge actual and necessary administrative expenses in operating the Program to the Fund.

History

Statutory/Other Authority: ORS 285A.075 & 285B.115(3)
Statutes/Other Implemented: ORS 285B.115 & 285B.119
EDD 8-2005, f. & cert. ef. 10-24-05
EDD 11-1992, f. & cert. ef. 8-18-92
Reverted to EDD 3-1991, f. & cert. ef. 4-17-91
EDD 15-1991(Temp), f. & cert. ef. 10-31-91
EDD 3-1991, f. & cert. ef. 4-17-91
EDD 27-1990(Temp), f. & cert. ef. 10-16-90

Division 19 OPERATION OF OREGON ENTREPRENEURIAL DEVELOPMENT LOAN FUND

Or. Admin. R. 123-019-0000 Purpose

The intent of the Entrepreneurial Development Loan Fund is to provide direct loans to help start-ups, micro-enterprises and small businesses expand, become established, and/or retain operations in Oregon. The Fund is intended to fill niches not provided by banks or credit unions through traditional lending programs. Loans made from the Fund are intended to bridge early-stage funding gaps that exist due to lack of operating history, limited availability of business and personal assets necessary to adequately secure the loan, limited liquidity, sub-standard credit quality and other credit risks. To the extent possible, Certified Entities will assist Applicants in developing application materials necessary to qualify for financing and the Department will structure loans to prepare Applicants to qualify for loans from traditional lenders. This Fund is intended to compliment, not compete with, private capital.

History

Statutory/Other Authority: ORS 285A.075, 285B.740-285B.758, Ch. 765 & OL 1993
Statutes/Other Implemented: ORS 285B.740 - 285B.758, Ch. 765 & OL 1993
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 3-1994, f. 2-4-94, cert. ef. 2-7-94
EDD 7-1993(Temp), f. & cert. ef. 9-17-93
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) "Applicant" means any individual, association of individuals, joint venture, partnership or corporation, person or any combination of persons applying for a loan from the Oregon Entrepreneurial Development Loan Fund.

(2) “Business plan” means a plan:

(a) For start-up entities, including but not limited to businesses with less than 24 months of operations, using the standard format set forth in Your Business Plan by Dennis J. Sargent or other such format as may be acceptable to the Certified Entity and the Department, or,

(b) For businesses with 24 or more months of operations an executive summary of business operations including projections and supporting narrative as may be acceptable to the Certified Entity or the Department.

(3) "Certified Entity" means any entity certified by the Finance Manager of the Oregon Business Development Department under OAR 123-019-0100 including Small Business Development Centers (SBDCs).

(4) "Collateral coverage ratio” means the number of times that the collateral could repay the loan principal. The ratio is usually expressed as “X:1” (or “X to 1”), where “X” is the collateral liquidation value (the net funds expected to be received from the sale of collateral, after expenses) divided by the amount of the loan.

(5) “Department” means the Oregon Business Development Department as established under ORS 285A.070.

(6) "Equity" means cash and real and personal property that is owned or controlled by an Applicant and committed to use in the project for which a loan from the Fund is being sought. Property other than cash will be conservatively valued by the Department.

(7) “Finance Manager” means the individual delegated authority by the Director of the Oregon Business Development Department to administer the Fund and make credit decisions on behalf of the Department.

(8) "Fund" or "EDLF" means the Oregon Entrepreneurial Development Loan Fund as defined and set forth in Section 13, Chapter 688, Oregon Laws 1991.

(9) "Loan Committee" means the Finance Committee of the Business Oregon Commission.

(10) “Loan to value” or “LTV” means the amount of the loan, expressed as a percentage of the value of the collateral. The formula is the loan amount divided by the value of the subject collateral.

(11) “Local Lender” means a non-depository small business lender that has a physical location in Oregon and that:

(a) Is certified as a community development financial institution by the Community Development Financial Institutions Fund at the United States Department of the Treasury;

(b) Is a nonprofit corporation as defined in ORS 307.130;

(c) Is an economic development district in Oregon designated by the Economic Development Administration of the United States Department of Commerce;

(d) Is affiliated with a local government as defined in ORS 174.116; or,

(e) Is affiliated with a tribal government as defined by ORS 294.805.

(12) “Principal” in regard to an Applicant is defined as:

(a) If a sole proprietorship, the proprietor;

(b) If a partnership, each managing partner and each partner who is a natural person and holds a 20% or more ownership interest in the partnership;

(c) If a corporation, limited liability company, association, cooperative or a development company, each director, each of the executives or officers of the entity, and each natural person who is a direct or indirect holder of 20% or more ownership stock or stock equivalent of the entity

(13) "Project" means the acquisition, improvement, rehabilitation, construction, operation or maintenance of any property, real or personal, that is or will be used or is suitable for use by an economic enterprise, but not including:

(a) A loan for the purchase or construction of residential housing;

(b) A loan for the purchase of property that will not be used for the business operation of the Applicant, or is a passive real property investment not used to house the operations of a related company;

(c) A loan for the sole purpose of refinancing of an existing loan unless the following criteria, at the sole discretion of the Department, are satisfied:

(A) Such existing loan was exclusively for a business purpose;

(B) The refinance is necessary to retain jobs or support continuance of the business operation; and,

(C) Can demonstrate to the Department that the Applicant has been denied credit twice for the same purpose as the Project by Local Lenders or Financial Institutions, as defined in ORS 706.008.

(14) "Severely Disabled" means:

(a) An individual or individuals certified as severely disabled by the Vocational Rehabilitation Division of the Department of Human Resources or the Commission for the Blind; or,

(b) A veteran who has a United States Department of Veterans Affairs total disability rating of at least 70 percent as a result of an injury or illness that the veteran incurred, or that was aggravated, during active military service and received a discharge or release under other than dishonorable conditions.

(15) "Small Business Development Center" or "SBDC" means any small business development center described in the Small Business Training Assistance Act of 1983.

(16) "Small Business Management Program" means any of the following:

(a) A going into business class;

(b) A Small Business Management Program offered by an Oregon SBDC; or,

(c) Any series of classes/seminars/workshops/counseling sessions offered by a Certified Entity that meet the approval of the Finance Manager.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.758
Statutes/Other Implemented: Ch. 765, OL 1993, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 53-2024, temporary amend filed 12/03/2024, effective 12/03/2024 through 05/31/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 35-2010, f. 10-14-10, cert. ef. 10-15-10
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 23-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 8-1995, f. & cert. ef. 10-26-95
EDD 3-1994, f. 2-4-94, cert. ef. 2-7-94
EDD 7-1993(Temp), f. & cert. ef. 9-17-93
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0020 Eligibility

(1) To be eligible for a loan from the Fund, each Applicant must meet one or more of the criteria in this section:

(a) The Applicant must have had total revenues of $1,500,000 or less in the 12 calendar months immediately preceding the date application is made to the Fund for a loan;

(b) The Applicant must have 25 or fewer full-time equivalent employees at the time of application; or,

(c) At least 50 percent of the Applicant’s business or proposed business must be owned by an individual or individuals classified as Severely Disabled.

(2) The Applicant may not be effectively owned or controlled by another business entity or other person, or own or control another business entity that, either by itself or when combined with the Applicant, is not eligible for a loan under this rule. Ownership of 50 percent or more of the Applicant would constitute, or a subsidiary which sells a majority of its goods or services to the parent may constitute, effective ownership or control. The Finance Manager may, however, make this determination based on the facts of an individual case.

(3) The Principal of the Applicant must be active in the day-to-day operations of the business, otherwise the business is considered to be a passive investment and is not eligible for a loan from this Fund.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.758
Statutes/Other Implemented: OL 2020 2nd SS Ch 10 Sec 26-27, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 23-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 4-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 10-1998, f. & cert. ef. 5-22-98
EDD 5-2007(Temp), f & cert. ef. 8-28-07 thru 2-22-08
EDD 10-1998, f. & cert. ef. 5-22-98
Reverted to EDD 3-1994, f. 2-4-94, cert. ef. 2-7-94
EDD 11-1997(Temp), f. & cert. ef. 10-7-97
EDD 3-1994, f. 2-4-94, cert. ef. 2-7-94
EDD 7-1993(Temp), f. & cert. ef. 9-17-93
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0030 Application Procedure

(1) Each Applicant shall certify to the Certified Entity and the Department that it is an eligible Applicant for the Fund under OAR 123-019-0020(1) and shall specify which of the criteria outlined in 123-019-0020(1) it meets.

(2) The Certified Entity may enroll the Applicant in an appropriate Small Business Management Program. Each Applicant shall:

(a) Have completed a Small Business Management Program;

(b) Be enrolled in a Small Business Management Program prior to Department action on such Applicant's loan request;

(c) Satisfactorily document to the Certified Entity and Department, a business plan that adequately demonstrates the ability of the Applicant to repay the proposed loan; or,

(d) If the business has been in operations for 24 months or more, the Department may accept Applicant-prepared projections with supporting assumptions, and an executive summary of the business operations and plan in lieu of satisfying the requirements of OAR 123-019-0030(2)(a)-(c). The Department may, at its sole discretion, require the review and assistance of a Certified Entity if the documentation provided is not considered adequate.

(3) Each Applicant shall certify to the Department that the applicant is enrolled in or has completed a Small Business Management Program as applicable or has prepared a business plan that has been reviewed by the Certified Entity unless the Applicant qualifies under OAR 123-019-0030(2)(d).

(4) Prior to applying for a loan from the Fund, each Applicant will provide to the Department a business plan or executive summary as applicable under OAR 123-019-0030(2).

(5) Unless otherwise waived in writing by the Finance Manager, the business plan must be reviewed by the counseling staff of the Certified Entity where the Applicant is enrolled in a Small Business Management Program or where the Applicant is receiving assistance with the preparation of the business plan. Review of the business plan by the Certified Entity does not imply any judgment by the Certified Entity as to the accuracy or validity of the plan.

(6) Upon completion and review of the business plan as provided in sections (4) and (5) of this rule, the business plan, together with a credit application on the form provided by the Department, along with all supporting financial documents, shall be forwarded to the Department for consideration. The credit application shall contain a detailed list of the proposed uses of the proceeds of the loan being sought from the Fund.

(7) The Department may require such additional information from an Applicant as the Department in its sole discretion determines is necessary for a thorough review and analysis of the application.

(8) Upon completion of its review, Department staff shall forward the application to the Finance Manager, with a recommendation for action. The Finance Manager may:

(a) Approve the application; or

(b) Deny the application; or

(9) If a loan request is approved, the Department shall prepare such documents as are necessary to close the loan transaction. Such documents shall reflect all terms and conditions upon which the Finance Manager may have conditioned their approval of the loan.

(10) An Applicant may apply for, and the Finance Manager may approve, subsequent loans from the Fund. No Applicant may receive more than an aggregate lifetime amount of $1,000,000 in loan proceeds from the Fund. Applicants for subsequent loans must meet the eligibility requirements outlined in 123-019-0020.

(a) For any loans that exceed $300,000, the Department shall extend a Local Lender with an opportunity to participate in funding a qualified project to assist the Local Lender to deploy their capital to qualified Applicants.

(b) If the Local Lender agrees to participate, the Department will take the lead role in underwriting and structuring the transaction.

(c) A Local Lender is not obligated to participate but is being invited into the project to maintain a productive, collaborative relationships between the Department and the Local Lender. Such participation will foster new relationships with local businesses and the Local Lender will serve as a point of contact for future technical and lending assistance needs after the loan is approved and funded.

(d) In the event that multiple lenders are operating in the area or region of the Applicant, the Department is only obligated to extend the partnership opportunity to one lender.

(11) The Department may notify the Certified Entity if any Applicant with which the Certified Entity has worked becomes delinquent in its payment or otherwise acts in such a manner as to jeopardize the repayment of the loan.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075, OL 2020 2nd SS Ch 10 Sec 26-27 & ORS 285B.758
Statutes/Other Implemented: Ch. 688, OL 1991, Ch. 765, OL 1993, OL 2020 2nd SS Ch 10 Sec 26-27, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 35-2010, f. 10-14-10, cert. ef. 10-15-10
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 10-1998, f. & cert. ef. 5-22-98
Reverted to EDD 8-1995, f. & cert. ef. 10-26-95
EDD 11-1997(Temp), f. & cert. ef. 10-7-97
EDD 8-1995, f. & cert. ef. 10-26-95
EDD 3-1994, f. 2-4-94, cert. ef. 2-7-94
EDD 7-1993(Temp), f. & cert. ef. 9-17-93
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0040 Loan Conditions

The Finance Manager may approve a loan request if the Finance Manager finds that:

(1) The Applicant and the project are eligible for a loan from the Fund according to the criteria set forth in OAR 123-019-0020 and 123-019-0030.

(2) The Applicant has available, and has irrevocably committed to the project, Equity funds in the form of cash or property in an amount equal to or greater than:

(a) Fifteen percent of the amount of the project proceeds used for working capital and equipment; or

(b) Ten percent of the amount of the project proceeds used to acquire real property.

(3) The proposed project is feasible and a reasonable risk from practical and economic standpoints, and the loan has a reasonable prospect of repayment from cash flow and collateral.

(4) The Applicant will provide good and sufficient collateral for the loan. The department reserves the right to require liens on all business assets and personal assets necessary to secure the loan at a “loan to value” ratio (“LTV”) of no greater than the advance rate applicable to the underlying asset or provide for a collateral coverage ratio of 1:1. In the event of a collateral shortfall, the LTV of the proposed loan may be no more than two times the advance rate applicable to the underlying asset or provide for a collateral coverage ratio of at least 0.5:1 applying the following advance rates:

(a) Real property will generally be valued for collateral purposes at 80 percent of the County Assessor’s tax assessed or real market value, or 90 percent of appraised value or acceptable broker opinion of value. Special-use or limited-use property may be further discounted at the sole discretion of the Department;

(b) New construction will generally be valued for collateral purposes at no more than 90 percent of cost or 90 percent of the as-completed value, whichever is less, and may be further discounted for special-use or limited-use property;

(d) Newly acquired equipment will generally be valued for collateral purposes at 60 percent of acquisition cost for new equipment and 75% of acquisition cost for used equipment.

(5) The Department may, in its sole discretion, assign a value of more or less than the above percentages. Applicants should be aware that the collateral value of property located or housed out-of-state will be significantly discounted from nominal assessed or appraised value.

(6) Monies in the Fund are or will be available for the proposed project.

(7) The Applicant's financial resources and management capability appear adequate to assure success of the project and repayment of the loan.

(8) The lifetime amount borrowed from the Fund by any Applicant in combination with any related entities does not exceed $1,000,000.

(9) The Applicant agrees to abide by all local, state and federal laws and regulations and will obtain all applicable federal, state and local permits and licenses before the disbursement of any proceeds from the Fund.

(10) The Applicant must be current on its local, state and federal tax obligations or has entered into and is current on its repayment agreement with the applicable taxing authority or authorities.

History

Statutory/Other Authority: ORS 285A.075, OL 2020 2nd SS Ch 10 Sec 26-27 & ORS 285B.758
Statutes/Other Implemented: OL 2020 2nd SS Ch 10 Sec 26-27, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 35-2010, f. 10-14-10, cert. ef. 10-15-10
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 23-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 4-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 10-1998, f. & cert. ef. 5-22-98
EDD 5-2007(Temp), f & cert. ef. 8-28-07 thru 2-22-08
EDD 10-1998, f. & cert. ef. 5-22-98
Reverted to EDD 12-1992, f. & cert. ef. 8-26-92
EDD 11-1997(Temp), f. & cert. ef. 10-7-97
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0050 Loan Agreement

If the Finance Manager approves the loan, the Finance Manager, on behalf of the state, and the Applicant may enter into a loan contract of not more than $1,000,000, secured by Collateral, which shall set forth, among other matters:

(1) A plan for repayment by the Applicant to the Fund of monies borrowed from the Fund used for the Project, with interest charged on those monies at a fixed rate of at least two percentage points (2%) more than the prevailing bank prime interest rate. For the purposes of this section, the prevailing bank prime interest rate shall be the rate set forth in the most recent Federal Reserve Statistical Release H.15(519) which the Department has received at the time the loan is approved. Loans secured by collateral with a collateral coverage ratio of less than 1:1, may be subject to a higher interest rate established at the sole discretion of the Department, based on the final collateral value established by the Department. The loan’s interest rate may be increased by no more than 1% between each 10% collateral deficiency threshold. Notwithstanding the foregoing, the interest shall not exceed 18 percent per annum. The repayment plan, among other matters:

(a) Shall provide for commencement of repayment by the Applicant of monies used for the Project and interest thereon no later than six months after the date of the loan contract or at such other time as the Finance Manager may provide;

(b) May provide for reasonable extension of the time for making any repayment, not to exceed six months, in emergency or hardship circumstances if approved by the Finance Manager;

(c) Shall provide for such evidence of debt, assurance of and security for, repayment of the loan as is considered necessary by the Finance Manager;

(d) Shall set forth a schedule of payments which shall not exceed the usable life of the assets financed and the term of the loan shall not exceed ten years from the date of the contract, whichever is less. The payment schedule shall include payment of interest which accrues during any period of delay in repayment authorized by subsection (b) of this section, and the payment schedule may require payments of varying amounts for collection of accrued interest;

(e) Shall set forth a procedure for formal declaration of delinquency or default of payment by the Department. Loans shall be declared delinquent when any payment is more than ten days late. Applicant shall be notified in writing of declaration of delinquency and shall have 31 days from the original payment date to bring the loan current. If the loan is not brought current, or arrangements satisfactory to the Department for bringing the loan current have not been made, the Department may declare the loan in default, may declare the entire outstanding indebtedness to be forthwith due and payable and may assign the loan to the Attorney General for collection. The Department shall inform the Applicant of each default and action taken in connection therewith. The Finance Manager may in their sole discretion waive or delay such assignment.

(2) Provisions satisfactory to the Department for field engineering and inspection, the Department to be the final judge of completion of the Project;

(3) That the liability of the state under the contract is contingent upon the availability of monies in the Fund for use in the Project;

(4) Such further provisions as the Finance Manager considers necessary to ensure expenditure of the funds for the purposes set forth in the approved application;

(5) That the Department may institute appropriate action or suit to prevent use of the facilities of a Project financed by the Fund if the Applicant is delinquent in the repayment of any monies due the State of Oregon;

(6) That the Applicant is responsible for payment of:

(a) All of the expenses of the operation and maintenance of the Project, including adequate insurance;

(b) All taxes and special assessments levied with respect to the business or the Project;

(c) Insurance premiums and providing insurance in amount and coverage acceptable to the Department. Such insurance shall include, but shall not be limited to, fire and hazard insurance, liability insurance, and flood insurance if applicable at the sole discretion of the Department; and

(d) All out-of-pocket costs associated with the loan closing including but not limited to filing and recording fees, title insurance and appraisals.

(7) The Department may, in its sole discretion, require that the Applicant provide to the Department on an annual basis, within 120 days of the end of each fiscal year, financial statements prepared in accordance with generally accepted accounting principles. In addition, copies of federal tax returns may be required to be submitted annually. The Department may require additional financial information or more frequent financial statements;

(8) In the case of a loan made to an association, corporation or partnership, each Principal of the corporation or association will provide a personal guaranty for the payment of all interest, repayment of the principal amount of the loan, and any other amount to come due under the loan agreement. The Department, at its sole discretion, reserves the right to require any Principal or owner of less than 20 percent of the company to provide a personal guarantee for the payment of all interest, repayment of the principal amount of the loan, and payment of any other amount to come due under the loan agreement;

(9) The Department may, in its sole discretion, disburse the proceeds of an approved loan in such amounts and at such times as the Department feels necessary to ensure that loan proceeds are used for the stated purposes and to preserve the integrity of the Fund. If the Department in its sole discretion determines that the financial condition of the Applicant has deteriorated since the eligibility and application process was commenced, the Department shall be under no obligation to disburse any loan funds.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS285A.075, OL 2020 2nd SS Ch 10 Sec 26-27 & ORS 285B.758
Statutes/Other Implemented: OL 2020 2nd SS Ch 10 Sec 26-27, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 35-2010, f. 10-14-10, cert. ef. 10-15-10
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 10-1998, f. & cert. ef. 5-22-98
Reverted to EDD 12-1992, f. & cert. ef. 8-26-92
EDD 11-1997(Temp), f. & cert. ef. 10-7-97
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0060 Appeals, Monitoring, Amendments and Modifications

(1) If the Finance Manager denies a loan request and if requested in writing by the Applicant within 30 days of the denial, the Department shall inform the Applicant in writing of the reasons for such denial.

(2) A denied Applicant has the right to appeal the denial in writing within 30 days of the Finance Manager's denial. Within 30 days of the appeal, the Applicant may submit whatever books, documents and data necessary to support the appeal. After reviewing the additional documentation, the Department shall schedule an appeal review by the Finance Manager, or the Loan Committee, as the Department may decide. If the Department elects to have the appeal reviewed by the Loan Committee, the Applicant may appear at the Loan Committee meeting to provide additional context to the information provided to support the appeal.

(3) An Applicant whose appeal has been denied must submit a new credit application to be eligible for consideration of a new loan request. This requirement may be waived by the Finance Manager, in their sole discretion.

(4) All loans shall be monitored by, and all loan repayments shall be made to, the Department or its assignee.

(5) It is the responsibility of the Applicant to ensure that its payment arrives in the Department by the due date.

(6) Any request for modification or amendment to any loan condition shall be made in writing to the Department and approved by the Finance Manager. The Finance Manager may refer a request for modification or amendment to the Loan Committee for recommendation.

(7) If the Finance Manager consents to any requested modification or amendment, the Applicant shall be responsible for all costs of modifying or amending any loan documents, filings, recordings or financing statements.

History

Statutory/Other Authority: ORS 285A.075, OL 2020 2nd SS Ch 10 Sec 26-27 & ORS 285B.758
Statutes/Other Implemented: ORS 285A.075, Ch. 765, OL 1993, OL 2020 2nd SS Ch 10 Sec 26-27, ORS 285B.740, ORS 285B.743, ORS 285B.746, ORS 285B.749 & ORS 285B.758
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 7-2021, amend filed 07/02/2021, effective 07/02/2021
OBDD 2-2021, temporary amend filed 01/19/2021, effective 01/19/2021 through 07/09/2021
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0070 Confidential Records

(1) Upon written request and within a reasonable time, the Department shall provide nonexempt loan program records for inspection in accordance with ORS Chapter 192.

(2) The person requesting inspection of the records may be charged in advance the Department's cost for locating, compiling, copying, and mailing the records. Such costs shall include but not be limited to costs incurred in locating records, separating exempt and nonexempt records, having a custodian present during the inspection, preparing lists of data, making photocopies, and telefaxing materials. Fees to be collected shall be set forth in the Department's schedule of fees and may be amended from time to time as the Department in its sole discretion may determine.

(3) Except as otherwise provided in ORS Chapter 192, records exempt from disclosure include but are not limited to:

(a) Reports and analyses of reports obtained in confidence from creditors, employers, customers, suppliers, and others which bear on the Applicant's character, finances, management ability, and reliability and which were obtained from persons or firms not required by law to submit them;

(b) Financial statements, tax returns, business records, employment history and other personal data submitted by or for Applicants, or analysis of such data;

(d) Formulas, plans, designs and related information which constitute trade secrets under ORS Chapter 192;

(e) Personal financial statements;

(f) Financial statements of Applicants;

(g) Customer lists;

(h) Information of an Applicant pertaining to litigation to which the Applicant is a party if the complaint has been filed, or if the complaint has not been filed, if the Applicant shows that such litigation is reasonably likely to occur. This exemption does not apply to litigation which has been concluded and nothing in this section shall limit any right or opportunity granted by discovery or deposition statutes to a party to litigation or potential litigation;

(i) Production, sales or cost data; and

(j) Marketing strategy information that relates to an Applicant's plan to address specific markets and Applicant's strategy regarding specific competitors.

History

Statutory/Other Authority: ORS.192.410-192.505 & ORS 285A.075
Statutes/Other Implemented: ORS.192.410 -192.505, 285A.075, Ch.765 & OL 1993
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0080 Restrictions

(1) If the loan will result in the construction, expansion, rehabilitation or remodeling of a facility to which the public has access, access for handicapped persons must be provided in accordance with ORS 447.210 to 447.280. This provision applies only to firms which deal directly with the general public in the normal and usual course of their business, and to facilities in which business is customarily transacted by and with members of the general public.

(2) Applicants receiving assistance from the EDLF are required to make a good faith effort to hire low income people who are trained by publicly-funded job training providers. Applicants may also be required to enter into a First Source Hiring Agreement as defined in OAR 123-070-0300 through 123-070-0370.

History

Statutory/Other Authority: ORS.285A.075 & ORS 285B.758
Statutes/Other Implemented: ORS 447.210-447.280 & Ch.765, OL 1993
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0090 Payment of Monies for Project

(1) The Finance Manager shall be the sole judge of the suitability and eligibility of a Project for financing from the Fund, and approval of such financing shall be in the sole discretion of the Finance Manager.

(2) If the Finance Manager approves a loan for a Project, the Department shall pay monies for the Project from the Fund, in accordance with the terms of the loan contract as prescribed by the Finance Manager.

(3) If the Finance Manager determines that a loan should be made, the Finance Manager shall also determine the amount of the loan and authorize the disbursement of the funds. The Finance Manager may authorize the Department to disburse the funds and execute such documents as may be necessary to conclude the transaction.

History

Statutory/Other Authority: ORS.285A.075
Statutes/Other Implemented: ORS 285A.075, .285B.740 - 285B.758, Ch. 765 & OL 1993
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 12-1992, f. & cert. ef. 8-26-92
EDD 16-1991(Temp), f. & cert. ef. 11-8-91

Or. Admin. R. 123-019-0100 Certification of Entities for Business Plan Review

(1) In addition to SBDCs, the Finance Manager may certify an entity for the review of business plans and for providing a Small Business Management Program if the Finance Manager finds in their sole discretion that the entity demonstrates in its proposal to become a certified entity that the management team and counseling staff of the certified entity adequately possess:

(a) Sufficient experience in providing financial counseling to businesses;

(b) Sufficient experience in providing a Small Business Management Program;

(d) Sufficient experience in assisting businesses with successfully accessing capital.

(2) The Finance Manager may establish time periods for certification and review in their sole discretion.

(3) The SBDCs and certified entities will continue to provide small business management services and counseling to the Applicant after the loan has been provided to the Applicant.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.740 -758
Statutes/Other Implemented: ORS 285B.740 -758, Ch. 688, OL 1991 & Ch. 765. OL 1993
OBDD 4-2025, amend filed 05/19/2025, effective 05/19/2025
OBDD 1-2023, amend filed 01/18/2023, effective 01/18/2023
OBDD 4-2022, temporary amend filed 03/09/2022, effective 03/09/2022 through 09/02/2022
OBDD 12-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 35-2010, f. 10-14-10, cert. ef. 10-15-10
OBDD 34-2010, f. & cert. ef. 10-1-10
OBDD 10-2010(Temp), f. & cert. ef. 4-12-10 thru 10-9-10
EDD 8-1995, f. & cert. ef. 10-26-95

Division 20 FORMATION OF PORTS

Or. Admin. R. 123-020-0100 Purpose and Scope

This division of administrative rules describes the steps and necessary elements for the Commission to approve the formation of a Port, as required under ORS 285A.627(2).

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
EDD 14-2004, f. & cert. ef. 8-2-04

Or. Admin. R. 123-020-0105 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context requires otherwise:

(1) "Applicant" means an entity that may legitimately seek and propose the formation of a new Port, and that submits a request for the Commission's approval.

(2) "Port" means a municipal corporation organized under ORS Chapter 777 or 778, which may be known as a "port authority" or "port district."

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0005, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0110 Application

An Applicant for the formation of a port must:

(1) Send the following, prior to any official filing with the appropriate county, to Attn: Port Formation Application, Oregon Business Development Department, State Lands Building Suite 200, 775 Summer Street NE, Salem, OR 97301-1280:

(a) A sample of the petition or order to be used for purposes of ORS 198.705 to 198.955, as applicable;

(b) A letter formally requesting formation of the proposed Port;

(2) Materials requested in OAR 123-020-0015 to 123-020-0035.

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0010, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0115 Criteria

In carrying out its function as statewide coordinating, planning, and research agency for all Ports in the State of Oregon, and to insure the most orderly, efficient, and economical development of the state port system, the Authority will take into consideration and may request information from the Applicant regarding the following:

(1) The need for port services in the territory to be included within the proposed Port;

(2) The adequacy of funding for the proposed Port; and

(3) The orderly development of the proposed Port and its effects upon the development of a state port system.

History

Statutory/Other Authority: ORS 285.075(5) & 285A.110(1)
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0015, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0120 Need for Port Services

In evaluating the need for port services, the Authority will take the following into consideration:

(1) That reasonable alternatives to the formation of a Port have been considered;

(2) That significant adverse effects on other public or private agencies offering similar services within the proposed service area have been considered;

(3) That economic benefits and opportunities such as increased employment, income, and cost savings have been considered; and

(4) That proposed Port boundaries are reasonable in terms of tax assessment and property ownership.

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0020, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0125 Viability of Formation

In reviewing the viability and merits of a proposed Port, the Authority will consider the following, in addition to the latest draft copy of the economic feasibility statement for district formation, if applicable, under ORS 198.749:

(1) A proposed budget of the proposed Port showing, among other things, capital improvements, staffing, and other sums and expenses required to implement and operate the proposed Port for a reasonable period;

(2) Adequacy of the existing tax base and proposed tax rate and the source and amounts of any other revenues estimated to be required; and

(3) Other financial information requested.

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0025, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0130 Orderly Development of Port and State Port System

The Authority encourages and seeks public views on the following issues as they relate to the formation of a specific port district:

(1) Relationship of the proposed Port activities to locally approved land use plans and the provision of other local public services or utilities;

(2) Coordination with affected environmental, economic, and social agencies, including the impact on affected taxing jurisdictions; and

(3) Effects of the proposed activities on transportation facilities and services.

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0030, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Or. Admin. R. 123-020-0140 Review and Commission Approval or Denial

(1) An applicant will not seek, nor will any agency of a county government do either of the following, until such time as the Authority approves the formation of the port:

(a) Conduct a deciding vote on port formation by the governing body of the county; or

(b) Place the question of the port's formation on the ballot of a special or general election.

(2) Upon receipt of a request under OAR 123-020-0010, the Authority will review the submitted materials and may request additional information.

(3) Following its review and receipt of any additional information, the Authority will assemble materials and information along with a summary of the proposed port's advantages and disadvantages relative to OAR 123-020-0015 to 123-020-0030 that may include a recommendation of action.

(4) The Authority will submit a proposal summary and recommendation to the board.

(5) The Authority shall schedule a meeting to consider final approval of the requested port formation. The agenda for this meeting must be publicly available and be sent to the applicant and other interested parties at least 21 days prior to such meeting. The meeting must afford an opportunity for public commentary.

(6) At the meeting described in this rule or a subsequent meeting, the board will formally approve or deny the proposed port's formation, as it deems appropriate.

(7) If the Authority denies a port formation request, it will indicate in writing the reasons and the remedies, if any, that would allow the applicant to be reconsidered.

(8) If formation of the port is approved by the authority.

(a) The Authority will issue a formal declaration of its approval that the Authority will provide to the applicant and to the Chair of the Board of County Commissioners for the respective county or counties; and

(b) The applicant will proceed with and abide by all applicable procedures and requirements under ORS Chapters 198 and 777.

History

Statutory/Other Authority: ORS 285.075
Statutes/Other Implemented: ORS 285A.627
EDD 13-2009, f. & cert. ef. 10-1-09
Renumbered from 123-020-0040, EDD 14-2004, f. & cert. ef. 8-2-04
EDD 3-2004(Temp), f. 2-3-04, cert. ef. 2-21-04 thru 8-1-04
EDD 7-2003(Temp), f. 8-28-03, cert. ef. 8-30-03 thru 2-20-04
EDD 2-2003(Temp), f. & cert. ef. 3-4-03 thru 8-29-03
EDD 6, f. & ef. 4-30-76

Division 21 OPERATION OF OREGON CREDIT ENHANCEMENT FUND

Or. Admin. R. 123-021-2100 Purpose

The purpose of these rules is to provide procedures, standards, and criteria for providing loan insurance from the Oregon Credit Enhancement Fund.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 27-2023, renumbered from 123-021-0000, filed 10/06/2023, effective 10/06/2023
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2200 Delegation

With the exception of appeals, the Department may authorize and approve loan insurance authorizations and require execution of any document necessary or convenient to make effective such insurance.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 27-2023, renumbered from 123-021-0130, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary suspend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2300 Definitions

For the purposes of these rules, additional definitions may be found in OAR chapter 123, division 1. The following terms shall have the following definitions, unless the context clearly indicates otherwise:

(1) "Authorized loan amount" means the amount of a loan authorized by the Department to be under the CEF Program pursuant to a loan insurance authorization issued by the Department to the financial institution making the loan.

(2) "CEF Program" means the Credit Enhancement Fund Insurance Program established under ORS 285B.200 to 285B.218.

(3) The "Deficiency" of a loan means the amount of principal outstanding upon default, accrued interest and the financial institution's reasonable costs of collection, exclusive of costs attributable to environmental problems, remaining unpaid after liquidation of collateral and collection of guarantees.

(4) "Financial institution" has the meaning set forth in ORS 706.008.

(5) "Fund" means the Credit Enhancement Fund created by ORS 285B.215.

(6) "Loan Insurance Authorization" means a letter from the director or deputy director or designee to a financial institution agreeing to insure a loan to a borrower on the terms and conditions and subject to the requirements stated therein.

(7) "Lender Agreement" means the agreement between the financial institution and the Department required by OAR 123-021-3500.

(8) “Material Adverse Change” or “MAC” means the deterioration of the Borrower’s credit quality resulting in the violation of a covenant or condition as defined in the Financial Institution’s loan agreement or binding commitment letter with the Borrower.

(9) "Principal" in regards to a borrower is defined as:

(a) If a sole proprietorship, the proprietor;

(b) If a partnership, each managing partner and each partner who is a natural person and holds a twenty percent (20%) or more ownership interest in the partnership; and,

(10) “Qualified Business” or “Borrower” means and must be:

(a) An existing or proposed business with operations in Oregon, which is engaged, directly or through an affiliated business, in the economic production of goods or services;

(b) Current with its federal, state and local tax obligations or have, and be current with, a repayment plan with the respective taxing authority and/or authorities;

(d) If the Qualified Business is a real estate holding company, all tenants of the Qualified Business must be and remain compliant with all local, state and federal laws and regulations.

(11) “Soft Cost” means an architecture, design, permitting, insurance, project management, tax or other intangible cost of construction that is not a direct or “hard” cost of construction such as land acquisition, labor or materials.

(12) “Substantial Benefit” may include, but is not limited to:

(a) Job creation or retention.

(b) Increased sales or profits.

(d) Diversification of the local or regional economy.

(e) Revitalization of a neighborhood or community.

(13) “SSBCI Program” means the State Small Business Credit Initiative Program administered by the United States Department of the Treasury. Links to the SSBCI Capital Program Policy Guidelines and Frequently Asked Questions are published by the United States Department of the Treasury.

(14) "Working Capital Loan" means any loan, the proceeds of which are to be used for operating, maintenance and costs and expenses unrelated to acquiring real property, production equipment, or other capital assets.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0200, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 2-2023, renumbered from 123-021-0010, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
OBDD 5-2015, f. & cert. ef. 8-3-15
Reverted to OBDD 3-2013, f. & cert. ef. 5-23-13
OBDD 1-2015(Temp), f. & cert. ef. 1-26-15 thru 7-24-15
OBDD 3-2013, f. & cert. ef. 5-23-13
Reverted to OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 18-2012(Temp), f. & cert. ef. 11-20-12 thru 5-17-13
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 5-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 8-1999, f. & cert. ef. 10-1-99
EDD 4-2007(Temp), f & cert. ef. 8-28-07 thru 2-22-08
EDD 8-1999, f. & cert. ef. 10-1-99
EDD 11-1998, f. & cert. ef. 5-22-98
Reverted to EDD 11-1994, f. & cert. ef. 7-29-94
EDD 12-1997(Temp), f. & cert. ef. 10-7-97
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2400 Eligibility

(1) Only Qualified Businesses are eligible to be Borrowers under the CEF Program. Further, in order for a loan to a Qualified Business to be eligible for insurance, the project must be expected to result in a Substantial Benefit that is realized primarily in Oregon and the project must meet one or more of the following purposes:

(a) The acquisition, improvement, or rehabilitation of real or personal property; or

(b) Working capital for operations, export transactions, maintenance and other business costs and expenses which are used for purposes other than acquiring real or personal property.

(2) Eligible project purposes do not include:

(a) Any personal, family, or household expenses of the Qualified Business or any Principal or guarantor;

(b) Purchase or construction of residential housing, including mixed-use properties with residential housing;

(c) A loan made primarily to pay off or refinance an existing debt to a creditor whose loan is inadequately secured or who is in danger of sustaining a loss;

(d) A loan made primarily to pay off or refinance an existing term debt to the Financial Institution applying for insurance on the proposed loan;

(e) Repayment of delinquent federal or state income taxes;

(f) Repayment of taxes held in trust or escrow;

(g) Acquiring, constructing, or holding passive investments such as commercial real estate for future use or the purchase of securities;

(h) Reimbursement or payment of funds to any owner or Borrower, including any equity injection or injection of business capital for the business' continuance, or the purchase of assets from any owner except as allowed under 123-021-2400(6); or

(i) Any other activities prohibited under the requirements of the SSBCI Program.

(3) The Department will consider applications to insure loans the proceeds of which are used to pay down or pay off an existing debt to a lender that is an unrelated entity of the Financial Institution applying for insurance. In evaluating such an application, the Department will consider the financial benefits to the Qualified Business, the prospects for success, the expected resulting public benefit, the extent to which the Financial Institution agrees to extend terms or provide other favorable financing to the Qualified Business, and the extent to which collateral securing the insured loan is improved real property. The Department's maximum liability for any loss resulting from an insured loan used to refinance debt will be limited to $6,000,000 and will be subject to the refinancing conditions of the SSBCI Program. The Department may require that some or all of the business and personal assets securing a refinancing be appraised to determine liquidation values.

(4) The Department reserves the right to set the enrollment terms at the time of approval for loan insurance, including, but not limited to, the Department's maximum liability or the insured percentage. When setting its maximum liability or the insured percentage or both, the Department will consider whether a loan is less than fully secured, as determined by the estimated liquidation value of the collateral.

(5) The Department will consider applications to insure loans where loan proceeds are limited to the purchase of the assets of a Qualified Business alone or in addition to the other eligible purposes identified in section (1) of this rule. Economic benefits including, but not limited to, the impacts of the proposed Qualified Business acquisition on retention or creation of jobs in Oregon shall be a major consideration in the Department’s review of such applications.

(6) For any Qualified Business and its affiliates, the aggregate maximum exposure for all loans insured through the Program shall not exceed $6 million.

(7) Any loans insured by federal funds received by the Department under the SSBCI Program must meet applicable U.S. Treasury requirements, including, but not limited to:

(a) No Principal of the Borrower or the Financial Institution has been convicted of a sex offense against a minor as such terms are defined in section 111 of the Sex Offender Registration and Notification Act (34 U.S.C. 20911).

(b) Neither the Borrower nor or any Principal of the Borrower is:

(A) An executive officer, director, or principal shareholder of the Financial Institution;

(B) A member of the immediate family of an executive officer, director or principal shareholder of the Financial Institution; or

(C) A related interest of an executive officer, director, principal shareholder of the Financial Institution or of a member of the immediate family of such executive officer, director or principal shareholder.

(D) For the purposes of OAR 123-021-2400(7)(c)(A) through (C), the terms "executive officer", "director", "principal shareholder", "immediate family", and "related interest" have the definitions ascribed in 12 C.F.R. Part 215.2 (2020), whether or not the Financial Institution is a member bank of the Federal Reserve System.

(c) The activities of the Borrower are not activities otherwise prohibited under SSBCI Program requirements, which activities include, but are not limited to:

(A) The Borrower is a business engaged in speculative activities that develop profits from fluctuations in price rather than through normal course of trade unless those activities are incidental to the regular activities of the business and are part of a legitimate risk management strategy to guard against price fluctuations related to the regular activities of the business;

(B) The Borrower is a business that earns more than half of its annual net revenue from lending activities unless the business is a non-bank or non-bank holding company community development financial institution;

(C) The Borrower is a business engaged in pyramid sales, or engaged in activities that are prohibited by federal law or applicable law in the jurisdiction where the business is located or conducted; or

(D) The Borrower is a business engaged in gambling enterprises unless the business earns less than 33% of its annual net revenue from lottery sales and gambling activities.

(d) The Financial Institution is in compliance with the requirements of the Bank Secrecy Act, 31 USC 5311, et seq. , and its implementing regulations.

(e) At the time of approval, the Borrower does not employ more than 750 employees in the United States.

(f) Total project costs are $20,000,000 or less.

(g) No Principal of the Borrower is a current member or delegate to the United States Congress or resident U.S. Commissioner.

(8) Loans funded by federal sources may be subject to additional eligibility requirements. The Department has sole discretion to determine whether a loan is funded by state or federal funding sources.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0300, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0020, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
OBDD 14-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 8-1999, f. & cert. ef. 10-1-99
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2500 Application Contents

(1) Required Contents. Unless waived by the Department, the Financial Institution shall submit to the Department an application containing the following:

(a) A completed General Information Sheet provided by the Department.

(b) A written narrative by the Financial Institution analyzing the Borrower's application (i.e., credit analysis and presentation), including an identification of the proposed amount of the loan; the requested percentage of insurance; Department insurance program under which the insurance is requested; the purpose, terms and conditions of the loan; a description of the collateral and basis for its valuation; a summary of the Borrower's credit standing; and a description of other sources of financing.

(d) Historical business financial statements for the prior three years, including income statements and balance sheets (income tax returns may also be required), as applicable, if an existing Borrower. Income tax returns may be sufficient if accountant-prepared statements are unavailable. Interim financial statements must also be included if the most recent statements are more than 90 days old as of the application’s filing date.

(e) Signed current personal financial statement(s) of owners with a minimum 20% ownership interest in the Borrower. Federal tax returns may be required. This information may also be required of guarantors.

(f) Pro forma balance sheet and income statement with supporting assumptions. In some instances, monthly cash flow statements may also be required. Cash flow statements are required in cases where loan repayment is dependent on projections and for Borrowers seeking working capital financing.

(g) For loans secured in whole or part by real property and for other insured loans, if requested by the Department, completion of the Department's environmental questionnaire or a comparable questionnaire provided by the Financial Institution and accepted by the Department.

(h) Such other information as the Department may require including, but not limited to, projected jobs to be created and/or retained by a Borrower and voluntarily reported demographic data.

(2) Supplemental Information. The Department may require, at its discretion:

(a) Appraisals of collateral or the Financial Institution's basis for determining collateral value;

(b) A business or marketing plan, including an analysis of competition;

(c) Certificates from the Oregon Department of Environmental Quality or any other governmental or regulatory agencies with jurisdiction, if applicable;

(d) Copies of leases or purchase agreements, as applicable;

(e) Any other information or certifications from the Borrower or the Financial Institution deemed by the Department to be necessary or desirable in connection with an insured loan application.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0400, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0040, filed 01/18/2023, effective 01/18/2023
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2600 Application Procedure

(1) A Financial Institution seeking loan insurance under the Program is responsible for submitting a complete application to the Department. The Department will not consider an application unless the Department determines that the application is complete and that information sufficient to make an informed decision on the application has been received.

(2) The Department will approve an application only in an insurance amount, insured percentage of loan principal, and insurance term that are necessary and prudent to complete the financing.

(3) No application will be approved unless the Department makes the following determinations:

(a) There is a reasonable prospect that the Borrower will repay a loan according to its terms;

(b) The insured loan will be serviced by the Financial Institution that applies for the insurance; and

(4) In reviewing applications, the Department will consider the following, as applicable:

(a) The extent to which the Borrower demonstrates a need for an insured loan;

(b) The economic feasibility of the project as evidenced by the Borrower's past and present financial circumstances, business experience and the commercial reasonableness of the business proposal and financial projections;

(d) Whether the Borrower has sufficient capital and other resources to conduct the business as planned;

(e) The amount and source of equity contributed by the Borrower;

(f) The adequacy of the collateral offered for the loan;

(g) The extent to which the risk of financial loss is shared by the Borrower, Financial Institution and the Fund;

(h) The viability of the industry of which the Borrower is a part and the contribution of the Borrower to that industry; and

(i) The extent to which the Borrower and project contribute to the local economy, industry diversification within the region, and local employment opportunities.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0500, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0050, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 5-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
Reverted to EDD 11-1998, f. & cert. ef. 5-22-98
EDD 4-2007(Temp), f & cert. ef. 8-28-07 thru 2-22-08
EDD 11-1998, f. & cert. ef. 5-22-98
Reverted to EDD 11-1994, f. & cert. ef. 7-29-94
EDD 12-1997(Temp), f. & cert. ef. 10-7-97
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2700 Application Decision

(1) The director or director’s designee will either approve or decline an application. Upon approval of an application, the Department will issue a Loan Insurance Authorization setting forth the terms and conditions upon which the loan will be insured.

(2) No Loan Insurance Authorization shall become effective until the Financial Institution has paid the initial loan insurance premium required by OAR 123-021-3600 and the Department and Financial Institution have entered into a Lender Agreement.

(3) If the director or the director’s designee declines an application, upon written request, the Department will provide the Financial Institution a notice that includes the reasons for declining the application. The notice shall include a notice of the Financial Institution’s opportunity to appeal the director’s or their designees’ decision to the Oregon Business Development Commission’s Finance Committee.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0600, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0060, filed 01/18/2023, effective 01/18/2023
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2800 Appeal to the Oregon Business Development Commission’s Finance Committee

A Financial Institution may appeal the decision of the Department declining the Financial Institution’s application. The appeal will be considered by the Oregon Business Development Commission’s Finance Committee. The Financial Institution must file a notice of appeal in writing to the Department within thirty days of the date of the Department’s notice declining the application. The notice of appeal must include a copy of the Department’s notice, a statement of why the decision should be reconsidered and any relevant supporting documentation. The Department will inform an appealing applicant of the time and location of the public meeting to consider the appeal, and the Financial Institution may be present to support the appeal through public comment.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0700, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0070, filed 01/18/2023, effective 01/18/2023
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1998, f. & cert. ef. 5-22-98
Reverted to EDD 11-1994, f. & cert. ef. 7-29-94
EDD 12-1997(Temp), f. & cert. ef. 10-7-97
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-2900 Loan and Insurance Terms and Conditions

(1) Interest rate. The rate of interest on the insured loan and the term of the loan shall be agreed between the Financial Institution and a Borrower. The maximum interest rate may not exceed the rate allowed by SSBCI Program guidelines.

(2) Collateral. Repayment of an insured loan shall be secured by such collateral as the Department deems prudent. With the exception of the Collateral Support Insurance, all other loans and lines of credit must be fully secured as determined by the Department.

(a) Loans eligible for Collateral Support Insurance are those secured by collateral for which the liquidation value is less than the principal amount of the loan. The Department will issue Collateral Support Insurance only if it determines that the Borrower, its Principals, and the guarantors, if any, exhibit strong credit histories and the ability to service the proposed and existing debt;

(b) Where real estate or machinery or equipment affixed to real estate constitute a significant portion of collateral for an insured loan, the real estate or affixed machinery and equipment must be located within Oregon. Moveable machinery or equipment, including rolling stock and vessels, constituting a significant portion of collateral for repayment of an insured loan shall be registered with and taxed by Oregon or municipal authorities within Oregon, if Oregon or municipal authorities register or tax machinery or equipment of a type similar to the collateral, and shall be stored or berthed in Oregon when not in use.

(c) The Department may, at its sole discretion, require an independent collateral valuation, appraisal or environmental assessment of the real property or other assets securing the loan.

(3) Covenants. The covenants and requirements of the loan shall be established by the Financial Institution in accordance with prudent lending practices and SSBCI Program requirements. The Department may condition application approval upon such additional covenants and requirements as may be necessary, prudent or desirable.

(4) The maximum Fund liability for any one Qualified Business, including any affiliates, is $6 million in the aggregate, regardless of the number of Loan Insurance Authorizations entered into with the associated Financial Institution(s) or the single-transaction limits established in this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0800, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0080, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
OBDD 3-2013, f. & cert. ef. 5-23-13
Reverted to OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 18-2012(Temp), f. & cert. ef. 11-20-12 thru 5-17-13
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-3000 Conventional Insurance Program

Under Conventional Insurance, the Department insures:

(1) Up to 80 percent of the original principal amount of a loan in an amount not to exceed the lesser of $6,000,000 or the product of the Authorized Loan Amount multiplied by the insured percentage.

(2) A maximum term that is the lesser of:

(a) The useful life of the assets being financed;

(b) The useful life of the assets used to secure the loan, if different than those financed by the loan; or

(3) Unless otherwise specified by rule, Conventional Insurance is available for all types of non-revolving loans with regular periodic payments of principal and interest, no less than annually, including Working Capital Loans that are secured by fixed assets or other collateral determined to be sufficient by the Department. Unless otherwise approved in writing by the Department, regular periodic payments of principal and interest must commence within 180 days of the loan closing date.

(4) At the discretion of the Department, Conventional Insurance may be provided to a term loan made to refinance existing revolving debt held by the Financial Institution applying for insurance on the proposed loan.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 4-2026, amend filed 02/20/2026, effective 02/20/2026
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-0900, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0090, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
OBDD 5-2015, f. & cert. ef. 8-3-15
Reverted to OBDD 3-2013, f. & cert. ef. 5-23-13
OBDD 1-2015(Temp), f. & cert. ef. 1-26-15 thru 7-24-15
OBDD 3-2013, f. & cert. ef. 5-23-13
Reverted to OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 18-2012(Temp), f. & cert. ef. 11-20-12 thru 5-17-13
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 5-2008(Temp), f. & cert. ef. 2-26-08 thru 8-1-08
EDD 1-2006, f. & cert. ef. 2-10-06
Reverted to EDD 11-1994, f. & cert. ef. 7-29-94
EDD 6-2005(Temp), f. & cert. ef. 8-5-05 thru 1-31-06
Reverted to EDD 11-1994, f. & cert. ef. 7-29-94
EDD 13-2002(Temp), f. & cert. ef. 6-18-02 thru 12-13-02
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-3100 Collateral Support Insurance Program

(1) Collateral Support Insurance is only intended to mitigate a collateral shortfall at the maturity of an existing loan secured by real estate and is not available to mitigate other or additional credit deficiencies. Collateral Support Insurance will only be provided to the extent necessary to facilitate the loan’s qualification under the Financial Institution’s lending guidelines. Loans covered by Collateral Support Insurance must satisfy a participating Financial Institution’s credit underwriting criteria with the sole exception of collateral adequacy. Insured loans must be amortized during the term of the Collateral Support Insurance to adequately reduce the principal balance of the insured loan in order to comply with the Financial Institution’s current advance rate policy based upon the collateral’s appraised value at the time of loan approval at or before the maturity of the Collateral Support Insurance.

(2) Loan proceeds may be used to pay off an existing loan only when the collateral value is no longer adequate to secure the loan due to a decline in the collateral’s value and the Borrower does not qualify for a loan that is less than fully secured at origination.

(3) Under Collateral Support Insurance, the Department’s maximum liability, up to a maximum of 100 percent of the Deficiency of a loan, shall be the lesser of:

(a) $1,500,000;

(b) 20% of the insured loan; or,

(4) Collateral Support Insurance may not exceed a term of 5 years.

(5) Borrowers with loans covered by Collateral Support Insurance must:

(a) Demonstrate significant current and historical cash flow coverage;

(b) Demonstrate strong credit history;

(d) Provide personal guarantees of Principals of the Borrower;

(e) May not have already had, or currently have, a loan covered by Collateral Support Insurance; and

(f) Meet such other criteria as determined by the Department.

(6) Unless otherwise specified by rule, Collateral Support Insurance is available for all types of non-revolving loans with regular periodic payments of principal and interest no less than annually for eligible purposes. To be eligible, regular periodic payments of principal and interest must commence within 60 days of the loan closing date.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.200 - ORS 285B.218
Statutes/Other Implemented: ORS 285B.200 - ORS 285B.218
OBDD 2-2024, adopt filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary adopt filed 10/13/2023, effective 10/13/2023 through 04/05/2024

Or. Admin. R. 123-021-3200 Evergreen Insurance Program

(1) Under Evergreen Insurance, the Department may insure up to 80 percent of the maximum principal amount of a line of credit in an amount not to exceed the lesser of $1,600,000 or the product of the Authorized Loan Amount multiplied by the insured percentage.

(2) To qualify for the Evergreen Insurance Program, the Qualified Business must be an existing or proposed business with operations in Oregon that:

(a) Lacks an existing revolving line of credit; or

(b) Seeks a new revolving line of credit to replace an existing line of credit that is within 120 days of cancellation or expiration by a lender other than the Financial Institution filing the application for Evergreen Insurance; or

(3) The maximum term of Evergreen Insurance is one year.

(4) To issue Evergreen Insurance, the Department must determine that the Financial Institution is sufficiently experienced and capable of operating such a lending program effectively. At the minimum, a Financial Institution must:

(a) Have the capacity to service the loan effectively, including monitoring compliance with any audit, advance and control procedures and limits prescribed by the Department or comparable procedures of the Financial Institution approved by the Department;

(b) Have in place and operate a lending program specializing in line of credit loans secured by, or with, advances based upon eligible accounts receivable and inventory or other assets; and

(c) Monitor the line of credit to ensure compliance with eligible advance rates and use of proceeds in accordance with the Financial Institution’s approved credit display and the Loan Insurance Authorization.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.200 - ORS 285B.218
Statutes/Other Implemented: ORS 285B.200 - ORS 285B.218
OBDD 4-2026, amend filed 02/20/2026, effective 02/20/2026
OBDD 2-2024, adopt filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary adopt filed 10/13/2023, effective 10/13/2023 through 04/05/2024

Or. Admin. R. 123-021-3300 Construction Loan Insurance Program

(1) Under Construction Loan Insurance, the Department may insure:

(a) Up to 80 percent of the original principal amount of a construction loan, provided that the Department's maximum liability for any Deficiency due to a Material Adverse Change under the Construction Loan Insurance is the lesser of $6,000,000 or the product of the Authorized Loan Amount multiplied by the insured percentage.

(b) A term of one year unless otherwise approved by the Department. Terms greater than one year may be granted at the sole discretion of the Department. Terms that exceed one year shall be subject to an additional premium based upon the maximum construction loan insurance exposure for each additional year approved. Terms of the Construction Loan Insurance shall be approved based upon the proposed construction schedule accepted by the Financial Institution which may be for less than a full year, provided that the Construction Loan Insurance premium shall not be pro-rated for a portion of a year.

(c) Owner-occupied commercial projects as determined by a minimum of 60 percent occupancy by the Borrower or affiliate of the Borrower.

(2) A maximum loan to value of 90 percent shall be allowed for commercial or industrial-use properties based upon the lesser of the actual project cost or as-complete appraised value. For single and limited-use properties, or if significant site development is required, a lower advance rate may apply as determined at the sole discretion of the Department.

(3) The following projects and activities are ineligible for Construction Loan Insurance:

(a) Single-family, multi-family, mixed-use and all other forms of non-commercial or non-industrial real estate;

(b) Speculative commercial or industrial real estate developments; and

(4) To issue Construction Loan Insurance, the Department must determine that the Financial Institution is sufficiently experienced and capable of monitoring the construction loan process effectively. To be considered for approval, in addition to requirements for Conventional Insurance, a complete construction loan application and the Financial Institution’s approved credit display must include or demonstrate, as applicable, the following:

(a) A signed copy of the fixed price construction contract and budget. Loans financing time and materials contracts are ineligible for insurance;

(b) An arm’s length relationship between the Borrower and general contractor;

(c) Construction to be performed by a general contractor that is licensed, adequately bonded and in good standing with the Oregon Construction Contractor’s Board. For general contractors with less than three years of comparable commercial or industrial contracting experience, a payment and performance bond shall be required;

(d) At least five percent retainage to be withheld from the general contractor out of each draw until completion;

(e) Soft costs that are incurred by the Borrower more than one year before the Financial Institution’s credit approval date are excluded from the total construction project amount;

(f) A minimum construction contingency commensurate with the type of project, and acceptable to the Department;

(g) Borrower’s equity in the project prior to origination of the construction loan;

(h) If land is acquired as part of the loan, that construction will commence within 9 months of acquisition; and

(i) An executed, binding loan commitment for permanent financing, as a separate credit facility, from the Financial Institution seeking Construction Loan Insurance.

(5) In addition to requirements for loans insured with Conventional Insurance, loans insured with Construction Loan Insurance will be subject to periodic reporting on the construction project and interim financial statements for the Borrower(s) and guarantors.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.200 - ORS 285B.218
Statutes/Other Implemented: ORS 285B.200 - ORS 285B.218
OBDD 2-2024, adopt filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary adopt filed 10/13/2023, effective 10/13/2023 through 04/05/2024

Or. Admin. R. 123-021-3400 Loan Defaults, Liquidation Plans and Payment of Insurance Claims

(1) A Financial Institution shall notify the Department within 30 days of a Borrower’s default on an insured loan.

(2) If the Borrower fails to cure the default and the Financial Institution anticipates writing off all or a portion of the loan’s outstanding principal balance, the Financial Institution must submit a liquidation plan for Department review and approval prior to the Borrower or the Financial Institution liquidating any assets pledged to secure the loan. The liquidation plan for the defaulted insured loan shall be in a form prescribed by the Department and shall include, but may not be limited to:

(a) A copy of the lender’s credit approval memo and supporting documentation of the loan;

(b) Personal financial statement(s) for the Borrower’s Principal(s);

(c) Itemization of all business and personal assets including, but not limited to, real estate, equipment and other chattel, accounts receivable, inventory, and intellectual property securing the loan. The inventory of assets shall include information on the status of the lender’s liens, current priority of lien positions on personal and business assets, current retail valuations of the assets, and anticipated discount of the assets for liquidation.

(d) Identification of any security that is unavailable to satisfy the loan and description of the reason(s) why the security is unavailable, for example, foreclosure by another lender;

(e) A written explanation describing the extent to which the lender plans to exercise its right to recover its loss by foreclosing on or otherwise liquidating collateral securing the loan; and

(3) Unless waived by the Department, all post-default recoveries and payments received by the Financial Institution shall be applied first to the Deficiency and then, if the Deficiency is repaid in full, the Financial Institution’s unpaid principal balance, collection costs, legal costs, environmental remediation expenses and other collection-related expenses available to it under the Lender Agreement.

(4) Upon the Borrower’s failure to cure its default under an insured loan, the Financial Institution shall collect on the loan in accordance with the approved liquidation plan. After making all commercially reasonable efforts to collect the Deficiency pursuant to the liquidation plan, the Financial Institution shall submit its claim for any Deficiency balance in a form prescribed by, or acceptable to, the Department. The Department will thereafter review the claim and any supporting documentation the Department may require in its sole discretion. Upon approving the claim, the Department will pay the claim in a single-lump sum payment. The balance of any loss not covered by Program insurance is absorbed by the Financial Institution.

(5) For Conventional Insurance, Evergreen Insurance, and Construction Loan Insurance, the maximum amount of a claim shall be the insured percentage times the unrecoverable Deficiency of the insured loan after applying proceeds from liquidation of the collateral, post-default payments by the Borrower or guarantors, right of intercept on account receivables, proceeds recovered from guarantors and any other sources of repayment identified in the Financial Institution’s loan approval and the Loan Insurance Authorization.

(a) To be eligible to make a claim on Construction Loan Insurance, unless otherwise waived by the Department, the Financial Institution must complete project construction sufficient to conduct an orderly liquidation of the project assets, which may include obtaining an occupancy permit and any other permitting necessary to maximize the liquidation value of the project assets.

(b) Within 30 business days of obtaining any loan recovery after the Department’s payment of the claim on a Deficiency, the Financial Institution shall remit to the Department a pro rata share of the recovery equal to the loan’s insured percentage. For example, for a loan covered by Construction Loan Insurance that insured 80% of the principal balance of the loan, the Financial Institution shall remit 80% of the post-claim recovery. Should the Financial Institution fail to timely repay recovered proceeds to the Department, the Financial Institution shall be in default of its Lender Agreement and shall be excluded from participation in the Program until the default is cured to the satisfaction of the Department.

(6) For Collateral Support Insurance:

(a) The maximum amount of a claim shall be the insured portion of the loan remaining after applying the proceeds from liquidation of the collateral, post-default payments by the Borrower or guarantors, right of intercept on account receivables, proceeds recovered from guarantors and any other sources of repayment identified in the Financial Institutions loan approval or the Loan Insurance Authorization. Recovered proceeds are applied first to the uninsured Deficiency and then to the insured Deficiency.

(b) Should any additional recoveries occur after payment of the claim on a Deficiency, the recovered proceeds shall be applied first to the uninsured Deficiency, then to the insured Deficiency.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.200 - ORS 285B.218
Statutes/Other Implemented: ORS 285B.200 - ORS 285B.218
OBDD 2-2024, adopt filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary adopt filed 10/13/2023, effective 10/13/2023 through 04/05/2024

Or. Admin. R. 123-021-3500 Lender Agreement

No Loan Insurance Authorization shall be effective unless the Financial Institution and the Department have executed a Lender Agreement in a form acceptable to the Department setting forth the relative rights and responsibilities of the Financial Institution and the Department for all insured loans. The Lender Agreement shall include the following:

(1) Provisions incorporating the requirements of this division of the rules and ORS 285.466 to 285.481.

(2) Provisions setting forth the responsibilities of the Financial Institution to prudently underwrite and service insured loans in such a manner as would be the normal and customary practice of a prudent lender making or servicing a loan without relying on loan insurance.

(3) A requirement that the Financial Institution notify the Department in writing within 5 business days after a Borrower's payment is 30 business days late and within 30 business days of any other default or other event or condition indicating that the loan may not be repaid in full. Upon default, the Financial Institution shall provide the Department a liquidation plan detailing such action as may be prudent, including without limitation foreclosing on and liquidating collateral. After obtaining the Department’s approval of the liquidation plan, the Financial Institution shall take such action to foreclose on and liquidation the assets and pursue remedies against the guarantees securing the loan.

(4) A description of the Department’s insurance Programs and the method for paying insurance claims.

(5) The Department shall be entitled at its discretion to cancel or reduce its insurance obligation if the Financial Institution breaches its responsibilities under the Lender Agreement or the Department-approved liquidation plan.

(6) Such other terms and conditions as the Department deems appropriate.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-1400, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0100, filed 01/18/2023, effective 01/18/2023
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-3600 Insurance Premiums

(1) The Department shall charge a one-time, up-front, insurance premium for each loan insured under a Lender Agreement pursuant to a Loan Insurance Authorization. The premium is due within 30 days of the date that the Department and the Financial Institution execute a Loan Insurance Authorization under the applicable Lender Agreement. The Department's insurance is not effective until the premium is paid. Premiums, expressed as a percentage of the Department’s maximum liability, shall be charged in accordance with the schedule made available by the Department.

(2) Insurance premiums for each insurance program, including examples of how those premiums are calculated, are as follows:

(a) The premium for Conventional Insurance, with a maximum term of 10 years, shall be 2.0% of the insured portion of the loan. As an example, the premium due on a $1,000,000, ten-year loan with 80% Conventional Insurance is $16,000 ($1,000,000 x 0.80 x 0.02).

(b) The premium for Collateral Support Insurance, with a maximum term of 5 years, shall be 5.0% of the insured portion of the loan. As an example, the premium for a $1,000,000 five-year loan with 20% Collateral Support Insurance is $10,000 ($1,000,000 x 0.20 x 0.05).

(c) The premium for Evergreen Insurance, with a maximum term of 1 year, shall be 1.5% of the insured portion of the line of credit. The premium is calculated as the product of the Department’s maximum liability multiplied by the maximum principal amount available to the Borrower under the subject line of credit, regardless of whether or not the line of credit is fully drawn down. As an example, the premium for a $1,000,000 loan with 80% Evergreen Insurance is $12,000 ($1,000,000 x 0.80 x 0.015); this amount would be due every year thereafter for up to four additional years, assuming that the loan is renewed each year for the maximum term permitted under the Evergreen Entrants Program (5 years).

(d) The premium for Construction Loan Insurance, with a minimum term of one year, shall be 1.0% of the insured portion of the loan. For each additional one year of Construction Loan Insurance approved by the Department the additional non-prorated premium shall be of 0.50% of the insured portion of the construction loan. A one-time, additional twelve-month extension may be granted for 1.0% of the insured portion of the loan.

(A) Example 1: The premium for a $1,000,000 12-month loan with 80% Construction Loan Insurance is $8,000 ($1,000,000 x 0.80 x 0.01).

(B) Example 2: The premium for a $1,000,000 30-month loan with 80% Construction Loan Insurance is $16,000 ($1,000,000 x 0.80 x 0.02).

(C) Example 3: The premium for a $1,000,000 9-month loan extension with 80% Construction Loan Insurance is $8,000 ($1,000,000 x 0.80 x 0.01).

(3) In its sole discretion, the Department may charge an additional fee for changes to an insured loan that requires modifying an existing Loan Insurance Authorization. This fee may be up to one half of the amount of the insurance premium charged at loan origination.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
OBDD 4-2026, amend filed 02/20/2026, effective 02/20/2026
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-1500, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0110, filed 01/18/2023, effective 01/18/2023
OBDD 7-2016, f. & cert. ef. 6-3-16
OBDD 6-2016(Temp), f. & cert. ef. 4-11-16 thru 10-7-16
OBDD 5-2015, f. & cert. ef. 8-3-15
Reverted to OBDD 3-2013, f. & cert. ef. 5-23-13
OBDD 1-2015(Temp), f. & cert. ef. 1-26-15 thru 7-24-15
OBDD 3-2013, f. & cert. ef. 5-23-13
Reverted to OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 18-2012(Temp), f. & cert. ef. 11-20-12 thru 5-17-13
OBDD 7-2012, f. & cert. ef. 6-1-12
OBDD 8-2011(Temp), f. & cert. ef. 12-8-11 thru 6-5-12
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-3700 Administrative Costs of the Program

The Department may charge the fund actual and necessary administrative expenses in operating the Fund and its programs.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285.476(2), (5) & 285.471(1)(b)
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-1600, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0120, filed 01/18/2023, effective 01/18/2023
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Or. Admin. R. 123-021-3800 Confidential Records

(1) The director or the director’s designee shall provide nonexempt Program records for inspection in accordance with ORS Chapter 192.

(2) The person requesting inspection of the records may be charged in advance the Department's cost for locating, compiling, copying, and mailing the records. Such costs shall include but not be limited to costs incurred in locating records, separating exempt and nonexempt records, having a custodian present during the inspection, preparing lists of data, making photocopies, and delivering materials. Fees to be collected shall be set forth in the Department's schedule of fees and may be amended from time to time as the Department in its sole discretion may determine.

(3) Except as otherwise provided in ORS Chapter 192, records exempt from disclosure include, but are not limited to:

(a) Reports and analyses of reports obtained in confidence from creditors, employers, customers, suppliers, and others which bear on the Borrower's character, finances, management ability, and reliability and which were obtained from persons or firms not required by law to submit them;

(b) Tax returns, business records, employment history and other personal data submitted by or for Borrowers, or analysis of such data;

(d) Formulas, plans, designs and related information which constitute trade secrets under ORS Chapter 192;

(e) Financial statements of Borrowers, Principals, guarantors or affiliates of those parties relating to an insured loan;

(f) Customer lists;

(g) Information of a Borrower pertaining to litigation to which the Borrower is a party if the complaint has been filed, or if the complaint has not been filed, if the Borrower shows that such litigation is reasonably likely to occur. This exemption does not apply to litigation which has been concluded and nothing is this section shall limit any right or opportunity granted by discovery or deposition statutes to a party to litigation or potential litigation;

(h) Production, sales and cost data; and

(i) Marketing strategy information that relates to a Borrower's plan to address specific markets and Borrower's strategy regarding specific competitors.

History

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 192.430 & 285.035(5)
OBDD 2-2024, amend filed 03/06/2024, effective 03/08/2024
OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 04/05/2024
OBDD 27-2023, renumbered from 123-021-1700, filed 10/06/2023, effective 10/06/2023
OBDD 4-2023, temporary amend filed 01/25/2023, effective 01/25/2023 through 07/23/2023
OBDD 3-2023, renumbered from 123-021-0140, filed 01/18/2023, effective 01/18/2023
EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 11-1994, f. & cert. ef. 7-29-94
EDD 5-1994(Temp), f. & cert. ef. 3-3-94

Division 22 SMALL BUSINESS DEVELOPMENT CENTERS

Or. Admin. R. 123-022-0060 Purpose

The purpose of these rules is to provide procedures, standards, and criteria for making grants under ORS 285B.168 and 285A.340 to 285A.349 to community colleges, community college service districts, and other allowed entities to assist in the improvement and formation of small business development centers.

History

Statutory/Other Authority: 285B.165 - 285B.180 & ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 6-1998, f. & cert. ef. 4-22-98

Or. Admin. R. 123-022-0070 Definitions

For the purposes of these rules definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context requires otherwise the following definitions apply:

(1) "Small Business Development Center" means a community college-based and state university-based center which helps small businesses develop and improve skill in such areas as marketing management and capital formation.

(2) "Oregon Small Business Development Center Network" means the statewide network of small business development centers.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.075 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 23-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 6-1998, f. & cert. ef. 4-22-98

Or. Admin. R. 123-022-0080 Eligibility Criteria

To be eligible for a grant, an entitle must be:

(1) a community college district, or a community college service district; or

(2) a public university listed in ORS 352.002; or

(3) a service provider offering small business development services in a specific geographic area that is not covered by entities described in (1) or (2).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 23-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 6-1998, f. & cert. ef. 4-22-98

Or. Admin. R. 123-022-0090 Application and Award Procedures

(1) Each applicant for a small business development center grant shall submit a work plan to the Oregon Small Business Development Center Network office. The annual work plan shall include:

(a) Evidence of the potential demand for assistance;

(b) Plans for involving other training resources and expert resource people from the business community;

(d) A budget for the year(s) for which a grant is requested, which includes in-kind contributions or combination of funds and contributions that the Small Business Development Center will be providing that may include federal, state, college or university, and client funds.

(e) A plan to participate in evaluations conducted by the Oregon Small Business Development Center Network office.

(f) A plan for alignment with Department’s job creation and retention definitions, policy and reporting methodology;

(g) A plan for alignment with Department strategic goals and focus on key industries

(2) The Oregon Small Business Development Center Network office shall review and approve the work plans submitted by applicants prior to disbursement of grant funds to the Small Business Development Center program recipients.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 23-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 6-1998, f. & cert. ef. 4-22-98

Or. Admin. R. 123-022-0100 Standards and Criteria

The Oregon Small Business Development Center Network office shall use the following criteria to evaluate applicants work plans:

(1) The number of small business clients to be served through one-to-one counseling and training programs as set out in the work plans;

(2) Special needs based upon geographic location or special populations to be served.

(3) The quality and the extent to which the work plan meets the needs of small business clients in the service area.

(4) Alignment with the Department’s job creation and retention definitions, policy and reporting methodology;

(5) Alignment with Department strategic goals and focus on key industries

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 23-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 6-1998, f. & cert. ef. 4-22-98

Or. Admin. R. 123-022-0110 Project Administration

The Department shall designate one of the small business development centers to coordinate the activities of all small business development centers. The desginee shall review the applications and work plans, disburse the grant funds, and manage the Oregon Small Business Development Center Network office. In making the designation, the Department shall consider the recommendations of others providing substantial financial support to the Oregon Small Business Development Center Network.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.340 - 285A.349 & 285B.165 - 285B.180
OBDD 1-2018, amend filed 01/18/2018, effective 01/18/2018
EDD 23-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 6-1998, f. & cert. ef. 4-22-98

Division 24 DISTRESSED AREAS

Or. Admin. R. 123-024-0001 Scope and Purpose

In accordance with ORS 285A.020(5), the department shall give priority when providing funding for a project, a program or activity, to counties, cities, communities or other geographic areas that are designated as distressed by the department. The designation of distressed areas must be based on indicators of economic distress, including but not limited to unemployment, poverty and job loss.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.020, 285A.075, 285B.062 & 285B.065
OBDD 2-2013, f. 3-29-13, cert. ef. 4-1-13
EDD 27-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 10-2008(Temp), f. & cert. ef. 3-20-08 thru 9-15-08
EDD 12-2007(Temp), f. & cert. ef. 9-21-07 thru 3-18-08
EDD 12-1998, f. & cert. ef 8-14-98

Or. Admin. R. 123-024-0011 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001 The following terms shall have the following definitions, unless the context clearly indicates otherwise: "City" means the area within the corporate limits of any incorporated city in Oregon.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.020, 285A.075, 285B.062 & 285B.065
OBDD 5-2019, amend filed 03/01/2019, effective 03/01/2019
OBDD 3-2014, f. 2-28-14, cert. ef. 3-3-14
OBDD 3-2013, f. 3-29-13, cert. ef. 4-1-13
EDD 24-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 27-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 10-2008(Temp), f. & cert. ef. 3-20-08 thru 9-15-08
EDD 12-2007(Temp), f. & cert. ef. 9-21-07 thru 3-18-08
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1998, f. & cert. ef. 8-14-98

Or. Admin. R. 123-024-0021 Distressed Area List

At least once per biennium, the department will review the economic conditions in Oregon and prepare a list of distressed areas. The distressed area list on file with the department's Director's Office is adopted as part of these rules by reference. The department will make the distressed area list available to all interested parties. A copy of the distressed area list, as well as further information related to the methodology described in OAR 123-024-0031 and so forth, may be obtained from the Director's Office, Oregon Business Development Department, State Lands Building Suite 200, 775 Summer Street NE, Salem, Oregon 97301-1280.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.095, 285B.062 & 285B
OBDD 2-2013, f. 3-29-13, cert. ef. 4-1-13
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 12-1998, f. & cert. ef. 8-14-98

Or. Admin. R. 123-024-0031 Methodology for Determining Distressed Areas

The department will consider a county, City, or other geographic area to be a distressed area under one of the following methods:

(1) Using the most recent data available on the date of calculation, a county is considered distressed when, an index is calculated as the product of the values calculated using four composite factors. It is distressed if its index is less than 1.0. If the index is more than 1.0 the county is considered non-distressed. The following are the four factors used to determine a distressed county:

(a) The state's unemployment rate divided by the county's unemployment rate;

(b) The county's per capita personal income divided by the state's per capita personal income;

(d) The sum of the change in the county’s employment over a two year period; or

(2) A city outside of a county identified as a distressed area under subsection (1) of this section may be designated as distressed when its variable values are below the designated threshold value as determined by at least three of the four indicators listed below. The threshold values for each of the four indicators shall be determined by using reliable data from each of the distressed counties based on a demonstrated methodology, as approved by the director of the department. Threshold values are calculated using the most recent 5 year American Community Survey data from the U.S. Census Bureau.

(a) Percentage of city population 25 years old and over with a bachelor’s degree or higher. The threshold value for variable A is the percentage of Oregon population 25 years old and over with a bachelor’s degree or higher. If the percentage of city population 25 years old and over with a bachelor’s degree or higher is higher than the percentage of Oregon population 25 years old and over with a bachelor’s degree or higher, this value is above the threshold and not distressed.

(b) The city’s unemployment rate. The threshold value for variable B is Oregon’s unemployment rate. If the city’s unemployment rate is lower than Oregon’s unemployment rate, this value is below the threshold and not distressed.

(c) Percentage of the city population 3 years of age and over, excluding those enrolled in college undergraduate and graduate or professional school, below the poverty level. The threshold value for variable C is the percentage of Oregon population 3 years of age and over, excluding those enrolled in college undergraduate and graduate or professional school, below the poverty level. If the percentage of the city’s population 3 years of age and over, excluding those enrolled in college undergraduate and graduate or professional school, below the poverty level is lower than the percentage of Oregon population below the poverty level, this value is below the threshold and not distressed.

(d) The city’s per capita personal income. The threshold value for variable D is Oregon’s per capita personal income. If the city’s per capita personal income is higher than Oregon per capita personal income, this value is higher than the threshold and not distressed.

(3) A county, City, or other geographic area that has demonstrated in writing, through a Temporary Distressed Petition, to the satisfaction of the director of the department, that it is suffering or is likely to suffer economic distress equal to or greater than those counties and cities qualifying as distressed areas under subsections (1) and (2) of this section. The director shall have the authority to declare counties, cities, and other geographic areas distressed as allowed under the Temporary Methodology for Determining Distressed Areas, OAR 123-024-0046.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.020, 285A.075, 285B.062 & 285B.065
OBDD 5-2019, amend filed 03/01/2019, effective 03/01/2019
OBDD 3-2014, f. 2-28-14, cert. ef. 3-3-14
OBDD 2-2013, f. 3-29-13, cert. ef. 4-1-13
EDD 24-2009, f. 11-30-09, cert. ef. 12-1-09
Reverted to EDD 27-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 4-2009(Temp), f. & cert. ef. 5-7-09 thru 11-2-09
EDD 27-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 10-2008(Temp), f. & cert. ef. 3-20-08 thru 9-15-08
EDD 12-2007(Temp), f. & cert. ef. 9-21-07 thru 3-18-08
Reverted to EDD 12-1998, f. & cert. ef. 8-14-98
EDD 10-2005(Temp), f. & cert. ef. 11-4-05 thru 12-21-05
EDD 7-2005(Temp), f. & cert. ef. 10-24-05 thru 12-21-05
Reverted to EDD 12-1998, f. & cert. ef. 8-14-98
EDD 3-2005(Temp), f. & cert. ef. 4-21-05 thru 10-15-05
EDD 12-1998, f. & cert. ef. 8-14-98

Or. Admin. R. 123-024-0046 Temporary Methodology for Determining Distressed Areas

The following methodology will be used to determine temporarily distressed areas when economic distress is abundant throughout the state of Oregon.

(1) State Temporary Distressed Test: In a given month, if Oregon’s unemployment rate exceeds 8.0%, the County Temporary Distressed Methodology will be used.

(2) County Temporary Distressed Test: In a given month, if Oregon’s unemployment rate exceeds 8.0% and if the county’s unemployment rate exceeds 8.0%, the county is considered temporarily distressed.

(a) When a temporarily distressed county’s unemployment falls below 8.0%, it will remain distressed for 180 days or until the regular distressed communities list is published, whichever is less.

(b) All places and cities within a temporarily distressed county are considered distressed.

(3) Any county that is unable to pass the County Temporary Distressed Test is not considered to be temporarily distressed. All cities or places within a county that is unable to pass the County Temporary Distressed Test may seek temporary distressed status by filing a temporary distressed petition defined in OAR 123-024-0031(3).

(4) Temporary Distressed Petition: Any city or place not considered distressed may submit a formal petition asking for temporary distressed status in accordance with OAR 123-500-0031(3)

(a) Temporary distressed petitions will describe in narrative form local conditions that warrant temporary distressed status.

(b) Local conditions may include, but are not limited to, first-source anecdotal discussions of changes in employment, temporary lay-offs, furloughs, firm closures, firm idlings, reduced sales revenue, home foreclosure rates, welfare assistance, and unemployment assistance.

(c) The temporary distressed status granted under the petitions will last no longer than 180 days or until the normal distressed communities list is published.

(5) If Oregon fails to pass the State Temporary Distressed Test, the regular distressed communities’ methodology will be used in December of the same year. The distressed communities list will be published at this time. All counties, cities, and places will maintain their temporary distressed status until the distressed communities list is published.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.020, 285A.075, 285B.062 & 285B.065
OBDD 2-2013, f. 3-29-13, cert. ef. 4-1-13
EDD 24-2009, f. 11-30-09, cert. ef. 12-1-09

Division 25 PORT PLANNING AND MARKETING FUND

Or. Admin. R. 123-025-0005 Purpose

The purpose of these rules is to provide procedures, standards and criteria for operation of the Port Planning and Marketing Fund program authorized by ORS 285A.654 through 285A.660.

History

Statutory/Other Authority: ORS 285A.075(5)
Statutes/Other Implemented: ORS 285A.654 - 285A.660
Reverted to EDD 1-2002, f. & cert. ef. 1-30-02
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02
Reverted to EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-2001(Temp), f. & cert. ef. 7-13-01 thru 1-9-02
EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-1987, f. & ef. 10-9-87
EDD 8-1985(Temp), f. 10-22-85, ef. 11-1-85

Or. Admin. R. 123-025-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. The following terms will have the following definitions, unless the context clearly indicates otherwise:

(1) "Fund" means Port Planning and Marketing Fund.

(2) "Peer Review Committee" means a committee of Oregon port representatives, as determined by the authority. The Peer Review Committee shall:

(a) Recommend standards and priorities for typical Port Planning and Marketing Fund projects;

(b) Review and evaluate Port Planning and Marketing Fund proposals submitted to the authority for possible funding; and

(3) "Project" means any activity that is eligible for assistance from the Port Planning and Marketing Fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02
Reverted to EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-2001(Temp), f. & cert. ef. 7-13-01 thru 1-9-02
EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-1987, f. & ef. 10-9-87
EDD 8-1985(Temp), f. 10-22-85, ef. 11-1-85

Or. Admin. R. 123-025-0012 Annual Funding of Program

The authority will transfer up to 5.00% of the assets of the Port Revolving Fund, not to exceed the annual accrued net income from the Port Revolving Fund into the Port Planning and Marketing Fund annually as calculated on receipt of the Fund Audit each year.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04

Or. Admin. R. 123-025-0015 Project Eligibility and Criteria

A planning or marketing project that meets the following criteria is eligible for assistance from the fund:

(1) The project is necessary for improving a port’s capability to carry out its authorized functions and activities relating to trade and commerce;

(2) The project is feasible and will produce measurable results;

(3) The project will promote the long-term economic self-sufficiency of the port and will encourage cost-effective investments guided by prudent financial consideration and review;

(4) The project has a single focus and does not attempt to accomplish multiple disjointed or unrelated outcomes or tasks;

(5) The applicant has met the strategic planning requirements in 123-025-0016; and

(6) The project meets the standards and criteria as set by the authority and Peer Review Committee in this division of administrative rules.

History

Statutory/Other Authority: ORS 285A.075(5)
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
Suspended by EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02
Reverted to EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-2001(Temp), f. & cert. ef. 7-13-01 thru 1-9-02
EDD 6-1997, f. & cert. ef. 4-25-97
EDD 5-1987, f. & ef. 10-9-87
EDD 8-1985(Temp), f. 10-22-85, ef. 11-1-85

Or. Admin. R. 123-025-0016 Strategic Business Plan Requirements

(1) Ports formed under ORS 777 shall develop and maintain strategic business plans before obtaining authority funding for other projects. This requirement will be phased in over several years. Ports must have a formally adopted strategic business plan that meets the standards and requirements of the authority identified in the Statewide Ports Strategic Business Plan.

(2) The Ports Statewide Strategic Business Plan was adopted by the Oregon Business Development Commission on January 29, 2010. Ports must have their plan in place within three years after the adoption of the Statewide Ports Strategic Business Plan in order to obtain financial assistance from the authority. The strategic business plans required under this rule shall be updated at least every ten years.

(3) Exceptions may be made by the Board for funding to Ports without a strategic business plan if:

(a) A concerted effort is made by the port to begin drafting a strategic business plan based on the department’s template that meets the requirements of the Statewide Ports Strategic Plan for adoption by the Board;

(b) During the phase in period of a project if the project complies with the recommendations of the Statewide Ports Strategic Plan;

(c) An extension of the three year deadline may be granted by the Board if a port is actively working to develop a department approved plan.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11

Or. Admin. R. 123-025-0017 Application Submittal, Review and Approval

(1) An eligible port may submit an application after consulting with the authority on a preliminary determination of eligibility and otherwise follow the authority’s s procedures for submitting applications. The application must be in the form provided by the Authority and must contain or be accompanied by such information as the authority may require. The authority will process only completed applications.

(2) Upon receipt of a signed application the authority will within 14 days notify the port as to the status of the application and advise the port of any missing materials or incomplete application detail.

(3) Upon receipt of a completed application the authority will apply the following criteria to determine the project’s eligibility:

(a) The project is cited in or conforms to a port’s adopted strategic business plan required under OAR 123-025-0016 and approved by the authority and the Peer Review Committee.

(b) The project is not an unnecessary duplication of marketing efforts among ports. However, it is recognized that regional or cooperative projects may require ports to simultaneously perform similar tasks;

(d) The project will not require or rely upon continuing subsidies from the authority or department;

(e) Financial need may be a consideration when reviewing a project proposal for funding; and,

(f) The requirements set out in OAR 123-025 are met. Should cite where these requirements are.

(4) Once an application is considered complete the authority will, within 60 days approve or reject the application.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02

Or. Admin. R. 123-025-0021 Project Funding Priorities

(1) At the beginning of each state fiscal year the authority and the Ports will make reasonable efforts to identify and initiate high priority projects. Funding of up to 50% of that year's transfer of funds will be reserved exclusively for high priority projects for the first four months of the state fiscal year, after which it will become available for any eligible project.

(2) Projects to develop or update the strategic business plans as required under OAR 123-025-0016, or port marketing or financial plans, undertaken before the provisions of ORS 123-025-0016, will be given the highest priority.

(3) Other high priority projects are:

(a) Regional or cooperative projects that benefit more than one port;

(b) Projects that leverage other marketing and development efforts by the state or other government units;

(c) Projects leading to economic diversification, development of a new or emerging industry or redevelopment of existing public facilities.

(d) Priority will be given for immediate job or revenue creation projects. Other opportunities not cited in a port’s adopted strategic business plan may be given priority, provided that the port consults with the authority and the Peer Review Committee and, if required to do so by the authority, the ruling body of the port acts to amend its strategic business plan.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02

Or. Admin. R. 123-025-0023 Grant Awards and Match

(1) The maximum grant is $50,000 or 75% of the total project cost, whichever is less.

(2) Grants will be awarded only when there are sufficient funds available in the fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 2-2026, temporary amend filed 01/02/2026, effective 01/02/2026 through 06/30/2026
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 15-2004, f. & cert. ef. 8-2-04
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02

Or. Admin. R. 123-025-0025 Project Administration

(1) The authority and the port must execute a grant contract prior to disbursal of grant funds.

(2) Documentation of project costs incurred by a port must be submitted to the authority prior to disbursal of funds.

(3) Disbursal of grant funds to a port will not exceed one disbursal per month. The final disbursement request will be withheld until the Peer Review Committee reviews and recommends approval of the appropriate grant contract deliverables of the project.

(4) Upon request the port must provide the authority with a copy of documents, studies, reports, and materials developed during the project, including written report on activities or results of the project, or any other information that may reasonably be requested by the authority.

(5) Prior to final disbursement, the Peer Review Committee will review all documents produced as a result of the project. The committee will evaluate and make recommendations to the authority on value of resulting document(s) and how closely the project delivered the outcome anticipated in the application.

(6) Any monies disbursed but not used for an approved project, must be returned to the authority.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
OBDD 2-2014, f. 2-28-14, cert. ef. 3-3-14
OBDD 5-2011, f. 10-31-11, cert. ef. 11-1-11
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 5-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 5-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02
Reverted to EDD 5-1987, f. & ef. 10-9-87
EDD 5-2001(Temp), f. & cert. ef. 7-13-01 thru 1-9-02
EDD 5-1987, f. & ef. 10-9-87
EDD 8-1985(Temp), f. 10-22-85, ef. 11-1-85

Or. Admin. R. 123-025-0030 Remedies

The authority may seek legal remedies against ports that fail to comply with the requirements governing the fund. Remedies will not be imposed by the authority until the port has been notified in writing of deficiencies and has been given a reasonable time to respond and correct the deficiencies noted.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.654 - 285A.660
EDD 18-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 17-2008, f. & cert. ef. 6-4-08
Reverted to EDD 5-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 13-2007(Temp), f. & cert. ef. 12-7-07 thru 6-1-08
EDD 5-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 15-2004, f. & cert. ef. 8-2-04
EDD 4-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 1-2002, f. & cert. ef. 1-30-02

Or. Admin. R. 123-027-0035 Purpose

The purpose of these rules is to provide procedures, standards and criteria for operation of the Marine Navigation Improvement Fund authorized by ORS 777.262 to 777.267.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 777.262 - 777.267
Reverted to EDD 5-1993, f. & cert. ef. 4-19-93
EDD 7-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 5-1993, f. & cert. ef. 4-19-93

Or. Admin. R. 123-027-0040 Definitions

For the purposes of these rules, the following terms will have the following definitions, unless the text clearly indicates otherwise:

(1) "Federally authorized project" means a project that has been authorized or qualifies for federal funding from the United States Army Corps of Engineers.

(2) "Non-federal project" means a navigation project that is eligible under these rules but does not qualify for federal funding from the United States Army Corps of Engineers.

(3) "Fund" means the Marine Navigation Improvement Fund.

(4) "Project" means studies, necessary permits, dredging, acquisition, modification and maintenance of dredge disposal sites and construction of a new navigation improvement project that is sponsored by a port and is eligible for assistance from the Fund. A project can be either a federally authorized project or a non-federally authorized project.

(5) "Non-Federal Share" means that portion of a project cost not paid for by the United States Army Corps of Engineers.

(6) "New Navigation Improvement Project" means, for the purpose of ORS 777.267(1)(b) a water project that directly supports, or provides access to, a federally authorized navigation improvement project or a federally authorized navigation channel. To be characterized as 'new', the dredging activity must go beyond previously maintained improvements such as deeper channel depths or wider breadth of area being served. However, "New Navigational Improvement project" does not include dredging deeper than the depths of the federally authorized navigation improvement project.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 24-2004, f 10-25-04, cert. ef. 11-8-04
EDD 22-2004, f. & cert. ef. 8-19-04
Reverted to EDD 14-2002, f. & cert. ef. 6-21-02
EDD 7-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 14-2002, f. & cert. ef. 6-21-02
EDD 5-1993, f. & cert. ef. 4-19-93

Or. Admin. R. 123-027-0050 Project Eligibility, Priority and Funding

(1) To be eligible for funding, Federally Authorized Projects must meet the following criteria:

(a) The project is federally authorized;

(b) The project is listed in the Port's business or strategic plan; and

(c) The project has confirmed positive benefit/cost ratios as required by the National Economic Development Plan and has completed all federally required studies.

(2) First priority for assistance from the Fund shall be given to eligible Federally Authorized Projects.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 22-2004, f. & cert. ef. 8-19-04
Reverted to EDD 14-2002, f. & cert. ef. 6-21-02
EDD 7-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 14-2002, f. & cert. ef. 6-21-02
EDD 5-1993, f. & cert. ef. 4-19-93

Or. Admin. R. 123-027-0056 Federally Authorized Project Application Requirements

The Port shall notify the Authority of a potential federally authorized project at the time it initiates the project with the United States Army Corps of Engineers and it shall submit written documentation to the Authority evidencing its participation with the United States Army Corps of Engineers. The written documentation must:

(1) Describe the nature and purpose of the project, including: proposed project scheduling; project term; estimated project cost; the Port's estimated non-federal share of the total project cost; and, the required schedule for payment of the Port's non-federal share of the total project cost;

(2) Contain federal documents that authorize the project, including Reconnaissance/Feasibility Studies; and

(3) Contain a copy of the Port's proposed Local Cost Share Agreement with the United States Army Corps of Engineers for undertaking and carrying out the project.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 22-2004, f. & cert. ef. 8-19-04

Or. Admin. R. 123-027-0060 Federally Authorized Project Application Review and Approval

Based upon a review of the information described in OAR 123-027-0056, the Authority will determine whether the project is eligible for assistance from the Fund. If the documentation is not adequate to determine eligibility, the Authority will require the Port to submit additional information as may be necessary.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 22-2004, f. & cert. ef. 8-19-04
Reverted to EDD 14-2002, f. & cert. ef. 6-21-02
EDD 7-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 14-2002, f. & cert. ef. 6-21-02
EDD 5-1993, f. & cert. ef. 4-19-93

Or. Admin. R. 123-027-0070 Federally Authorized Project Award and Funding

(1) The Authority and the Port shall execute a contract prior to disbursal of moneys from the Fund. The contract shall be in a form and content as provided by the Authority.

(2) Payments from the Fund shall be disbursed in accordance with the executed contract.

(3) The Port must provide the Authority with a written report, records, and a detailed accounting of costs in the format required by the Authority :

(a) Within 30 days following the close of each federal fiscal year; and

(b) Within 90 days following final completion of a project.

(4) Any amount disbursed from the Fund and not used for a project must be returned to the Authority.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 24-2004, f 10-25-04, cert. ef. 11-8-04
EDD 22-2004, f. & cert. ef. 8-19-04
Reverted to EDD 14-2002, f. & cert. ef. 6-21-02
EDD 7-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 14-2002, f. & cert. ef. 6-21-02
EDD 5-1993, f. & cert. ef. 4-19-93

Or. Admin. R. 123-027-0106 Non-Federal Project Eligibility

Non-federally authorized projects that meet the following criteria are also eligible for assistance from the Fund:

(1) The project is listed in a Port's business or strategic plan;

(2) The project is ready to begin in the biennium for which funding is requested;

(3) The project is a new navigation improvement project; and

(4) The project meets the criteria of a freight project, or a commercial/recreation project, as follows:

(a) A freight project facilitates transportation for at least 5,000 tons of freight or cargo annually;

(b) A commercial/recreation project supports at least 1,000 use days annually as evidenced by information from the State Marine Board, the Ports Reporting System, the U.S. Coast Guard, or other similar source of reliable data, or it is to support the operation of at least one tour boat.

(5) Navigation improvement projects that can't meet the criteria listed in subsection (4) may still qualify for funding if:

(a) The proposed improvement project is designed to facilitate usage to a level that exceeds the criteria in subsection (4); and

(b) Usage of the proposed improvement project is reasonably forecasted to meet the criteria in subsection (4) within the first two years of operation and exceed the minimum criteria thereafter.

History

Statutory/Other Authority: ORS 285.075(5) & 285A.110
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 24-2004, f 10-25-04, cert. ef. 11-8-04
Renumbered from 123-027-0100 by EDD 22-2004, f. & cert. ef. 8-19-04
EDD 14-2002, f. & cert. ef. 6-21-02

Or. Admin. R. 123-027-0156 Non-Federal Project Application Requirements

(1) A Port may submit an application after consulting with Authority staff on a preliminary determination of eligibility and otherwise following the Authority's procedures for submitting applications.

(2) The application must be in the form provided by the Authority and must contain or be accompanied by such information as the Authority may require. The Authority will process only completed applications.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 22-2004, f. & cert. ef. 8-19-04

Or. Admin. R. 123-027-0161 Non-Federal Project Application Review and Approval

To approve an application for assistance from the fund, the Authority must make the determinations as follows:

(1) The project is an eligible project. If the Authority determines that the project is not eligible, it may reject an application or require further documentation from the Port;

(2) The requisite need for the project has been demonstrated to the Authority in the application or the local planning process;

(3) If application is for a loan, the loan security includes the pledge of revenues and/or other funds, and is sufficient, when considered with other security, to assure repayment;

(4) The Port is willing and able to enter into a contract with the Authority; and

(5) Moneys in the fund are or will be available for the project.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 22-2004, f. & cert. ef. 8-19-04

Or. Admin. R. 123-027-0166 Non-Federal Project Award and Funding

(1) The Authority and the Port will execute a contract prior to disbursal of moneys from the Fund. The contract will be in a form and content as provided by the Authority.

(a) Payments from the fund will be disbursed in accordance with the executed contract.

(b) The Port must provide the Authority with written reports, records, and an accounting of detailed costs for a project as described in the contract.

(2) All eligible projects may be awarded loan funding of up to 100% of the total project cost, or for the required local match, under the following terms:

(a) Interest rates will be determined by Authority at time of award, according to Authority policy; and

(b) The loan term will not exceed 25 years.

(3) If the Authority determines 100% loan funding is not feasible due to the financial hardship of the port, grants may be awarded if Authority determines at least one of the following circumstances exists:

(a) Job creation and/or retention will be a direct result of the project;

(b) There is an urgent need for environmental remediation and the Authority's financial analysis determines that the Port's borrowing capacity is insufficient to finance the project;

(c) The project deals with critical public safety issues and the Authority's financial analysis determines that the Port's borrowing capacity is insufficient to finance the project; or

(d) There is imminent threat that the Port will lose any applicable permits and the Authority's financial analysis determines that the Port's borrowing capacity is insufficient to finance the project.

(e) The Authority's financial analysis determines that the project cannot proceed without a grant.

(4) Projects eligible due to the provisions of subsection 0106 may be awarded grant funding up to 75 percent of the project cost. A 25 percent local match is required. In-kind services from the Port may be no more than 10 percent of the total project cost.

(5) The Port must secure, and be able to provide upon request, a land use compatibility statement from the appropriate jurisdiction(s) for the project.

(6) Any amount disbursed from the Fund and not used for a project must be returned to the Authority.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 4-2006, f. 9-28-06, cert. ef. 10-1-06
EDD 2-2006, f. & cert. ef. 2-10-06
EDD 24-2004, f 10-25-04, cert. ef. 11-8-04
EDD 22-2004, f. & cert. ef. 8-19-04

Or. Admin. R. 123-027-0211 Federal and Non-Federal Project Appeals and Exceptions

(1) Appeals of local government decisions regarding a Project must be made at the local level.

(2) The Director will consider appeals of the Authority's funding decisions. Only the Port may appeal. Appeals must be submitted in writing to the Director within 30 days of the event or action that is being appealed. The Director's decision is final.

(3) The Director may waive non-statutory requirements of this program if it is demonstrated such a waiver would serve to further the goals and objectives of the program.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 777.262 - 777.267
EDD 19-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 2-2006, f. & cert. ef. 2-10-06
Renumbered from 123-027-0110, EDD 22-2004, f. & cert. ef. 8-19-04
EDD 14-2002, f. & cert. ef. 6-21-02

Division 30 PORT REVOLVING FUND

Or. Admin. R. 123-030-0000 Purpose

The purpose of these rules is to provide procedures, standards and criteria for operation of the Port Revolving Fund program authorized by ORS 285A.669 through 285A.732.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 8-2002, f. & cert. ef. 5-1-02

Or. Admin. R. 123-030-0004 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. The following terms have the following definitions unless the context clearly indicates otherwise: "Fund" means the Oregon Port Revolving Fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 6-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02

Or. Admin. R. 123-030-0010 Need for the Port Revolving Fund Project

(1) Applications must include sufficient information that will demonstrate the need for the project. The information must include, but not be limited to, the following:

(a) Whether economic benefits and opportunities such as increased employment, increased personal income, and cost savings are evident;

(b) Whether the applicant has a prospective user or other near-term use of the proposed project; and

(2) In the event the loan is primarily for a proposed project to facilitate the location or expansion of an industry pursuant to ORS 285A.666–285A.732, the industry expansion to be induced by the loan must include activities consistent with the infrastructure target industries or Ports adopted Strategic Business Plan.

(3) Need for the project will be established for the purpose of these rules for in-state plant relocation if:

(a) The firm engaging in in-state plant relocation has demonstrated that the relocation is necessary for reasons beyond its control;

(b) The relocation will provide a substantial increase or prevent a substantial direct reduction in total Oregon employment.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02
EDD 17-1990, f. & cert. ef. 6-28-90
EDD 9, f. & ef. 10-14-77

Or. Admin. R. 123-030-0020 Application Requirements

An eligible port district may submit an application after consulting with Authority staff on a preliminary determination of eligibility and otherwise following the Authority procedures for submitting applications.

(1) The application must be in the form provided by the Authority and must contain or be accompanied by such information as the Authority may require. The Authority will process only completed applications.

(2) All applications for loans from the Oregon Port Revolving Fund must indicate the proposed collateral to secure the loan and must include the following information:

(a) If the port's taxing authority is proposed to be pledged as collateral, a statement certified by the county assessor's office that sets forth the current millage rate, the projected new millage rate, if required to pay off the loan, the port's maximum current limitation, and a statement indicating whether the proposed pledge is within the port's current maximum mill[MB2] age limitation;

(b) If any of the port's personal or real property is proposed to be pledged as collateral, the Authority may require a formal appraisal, certified by an appropriate licensed authority, attesting to the value of all collateral proposed to be held as security.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
OBDD 12-2024, amend filed 05/31/2024, effective 05/31/2024
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 6-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02

Or. Admin. R. 123-030-0030 Application Review and Approval

(1) To approve an application for assistance from the fund, the Authority must make the determinations as follows:

(a) The project is consistent with the requirements governing assistance from the fund. If the Authority determines that the applicant and/or the proposed project do not meet the requirements of this section, the Authority may reject an application or require further documentation from the applicant;

(b) The requisite need for the project has been demonstrated in the application or the local planning process;

(d) The loan security includes the pledge of revenues and/or other funds are sufficient, when considered with other security, to assure repayment;

(e) The applicant is willing and able to enter into a contract with the Authority for repayment of the loan;

(f) The project is ready to proceed including all necessary permits required by federal, state and local agencies;

(g) The project activities constitute an eligible project;

(h) Moneys in the fund are or will be available for the project;

(i) The requirements under ORS 285A.055 for approval have been satisfied;

(2) The Authority may provide preliminary approval of a loan application at any time and identify all necessary requirements for final approval.

(3) If the application is denied, the matter will be set aside unless the applicant requests further action under ORS Chapter 183.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
OBDD 12-2024, amend filed 05/31/2024, effective 05/31/2024
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 6-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02

Or. Admin. R. 123-030-0040 Loan Contract Terms and Conditions

(1) The interest rate on a loan will be based on market conditions for similar debt, and will be set at the time of the award.

(2) The term of the loan will not exceed the useful life of the contracted project or 30 years from the year of project completion, whichever is less.

(3) For a flexible manufacturing space project, the loan contract may provide that no interest accrue until the building is 25 percent occupied, or until three years after the date of the loan contract, whichever is earlier.

(4) The loan contract will:

(a) Be in a form as provided by the Authority, and

(b) Provide that the Authority may institute appropriate action to prevent use of project facilities financed by the fund if the port is delinquent in its repayments.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732
OBDD 12-2024, amend filed 05/31/2024, effective 05/31/2024
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 6-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02

Or. Admin. R. 123-030-0050 Sanctions, Exceptions and Appeals

The Department may seek legal remedies against ports that fail to comply with the requirements governing the fund. The Department will not impose remedies until the port has been notified in writing of deficiencies and has been given a reasonable time to respond and correct the deficiencies noted.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.669 - 285A.732 & 285A.690
OBDD 15-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 20-2009, f. 10-30-09, cert. ef. 11-1-09
EDD 6-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 16-2004, f. & cert. ef. 8-2-04
EDD 1-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 8-2002, f. & cert. ef. 5-1-02

Division 39 AQUIFER RECHARGE TESTING FORGIVABLE LOAN PROGRAM

Or. Admin. R. 123-039-0000 Purpose and Objectives

These rules establish procedures for the administration of the Aquifer Recharge Testing Forgivable Loan Program (“Program”) established under Oregon Laws 2023, chapter 606, Sections 30 and 31 (Enrolled House Bill 2010), under which the Infrastructure Finance Authority within the Oregon Business Development Department will make forgivable loans to eligible applicants to perform Aquifer Recharge testing activities.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, the following terms shall have the following meaning, unless the context clearly indicates otherwise:

(1) “Aquifer Recharge” means the use of Artificial Groundwater Recharge or Aquifer Storage and Recovery methods to intentionally add water diverted from another source to a groundwater reservoir.

(2) “Artificial Groundwater Recharge” (AR) means the intentional addition of water diverted from another source to a groundwater reservoir.

(3) “Aquifer Storage and Recovery” (ASR) means the storage of water from a separate source that meets drinking water standards in a suitable aquifer for later recovery and not having as one of its primary purposes the restoration of the aquifer.

(4) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(5) “Department” means the Oregon Business Development Department.

(6) “DEQ” means the State of Oregon Department of Environmental Quality.

(7) “Fund” means the Aquifer Recharge Fund.

(8) “Municipal Subdivision” means an Oregon city or county, a county service district organized under ORS chapter 451.

(9) “OWRD” means the Oregon Water Resources Department.

(10) “Program” means the Aquifer Recharge Testing Forgivable Loan Program.

(11) “USGS” means the United States Geological Survey.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0020 Eligible Applicants

The following entities are eligible to apply for a Program forgivable loan:

(1) A Municipal Subdivision;

(2) A port organized under ORS chapter 777 or 778;

(3) A district as defined in ORS 198.010;

(4) An Oregon Indian tribe as defined in ORS 294.805; and

(5) A county in this state.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0030 Eligible Project Costs and Activities

(1) Eligible project costs include the necessary and reasonable costs, as determined by the Authority, for eligible project activities.

(2) Eligible project activities include, but are not limited to:

(a) Energy costs;

(b) Operation and maintenance costs associated with the treatment and delivery of source water for the purposes of testing Aquifer Recharge or aquifer storage and recovery; and

(c) Monitoring and reporting costs required by the monitoring plan of a permit or limited license issued by OWRD under ORS 537.143 and 537.144 or 537.505 to 537.534, OAR 690-350-0120, or OAR 690-350-0030.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 48-2024, minor correction filed 11/05/2024, effective 11/05/2024
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0040 Ineligible Project Costs

The following costs are ineligible for reimbursement under the Program:

(1) Cost of purchase of general purpose motor vehicles and other equipment not directly related to the project; and

(2) Indirect costs incurred by the applicant or a contractor.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0050 Application Requirements

In order to receive a Program forgivable loan, an eligible applicant must submit an application to the Department that:

(1) Adequately describes the project’s scope and feasibility;

(2) Is in the form provided by the Department;

(3) Is accompanied by documentation that the following items have been completed or are available for inspection:

(a) The Applicant has obtained a valid permit or limited license, issued by OWRD under ORS 537.143 and 537.144 or 537.505 to 537.534, or OAR 690-350-0120 or OAR 690- 350-0030, to conduct AR or ASR testing at the site to which the application relates; and

(b) Documentation showing that all or a portion of the basin or aquifer to which the application relates has been:

(A) Restrictively classified under ORS 536.340;

(B) Withdrawn by the OWRD from further groundwater appropriation under ORS 536.410; or

(c) Documentation that demonstrates, in the Department’s sole discretion, that all landowners who own property on which injection, infiltration, recovery, or monitoring activities will take place are aware of, and agree to, the work to be completed under the proposal.

(4) Satisfies any additional requirements the Department may impose.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 49-2024, minor correction filed 11/05/2024, effective 11/05/2024
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0060 Application Review and Approval

(1) The Department will review all submitted applications to determine if they are complete and are accompanied by all necessary supporting documentation.

(2) Once the Department has determined that an application is complete, the Department shall review the applications for the following:

(a) Project feasibility;

(b) Whether the applicant has any active Program projects. The Department may limit the number of open projects an applicant may have at any one time;

(d) Whether the applicant’s financial resources and borrowing capacity, are sufficient to finance the project; and

(e) Any other criteria set forth in the request for applications or other notices of funding availability issued by the Department.

(3) Once the review is complete, the Department shall approve or reject the application. The Department may make forgivable loan decisions in a manner that maximizes the use of available resources applying prudent fiscal management of the Fund in order to manage limited funding resources and considers geographic diversity in award recipients.

(a) If an application is approved the Department shall issue the applicant a notice of intent to award which will detail the amount of the award, the interest rate, and any other information the Department considers necessary.

(A) The principal amount of a forgivable loan award will not exceed the total cost of the project.

(B) Forgivable loan awards will not exceed five years.

(C) After issuing a notice of intent to award, the Authority will begin negotiating the forgivable loan agreement with the selected applicants.

(D) If the parties have not executed a forgivable loan agreement within 90 days after negotiations begin, the Authority may rescind its notice of intent to award and reallocate Program funds.

(b) If the Department rejects an application, it will issue the applicant a letter of explanation. Rejection of an application does not preclude the applicant from reapplying at any time with respect to the same or another basin or aquifer.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0070 Application Prioritization

The Department may set forth prioritization or tie breaking considerations in the request for applications or other notices of funding availability.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0080 Loan Requirements and Disbursement of Funds

(1) Prior to the disbursement of any loan funds, the applicant must enter into a loan agreement with the Authority.

(2) The loan agreement shall be in a form provided by the Authority, and must include:

(a) A provision that disbursements will be according to the terms of the loan agreement;

(b) A provision that the liability of the Authority under the loan agreement is contingent upon the availability of moneys in the Fund for use in the project;

(c) A provision that requires the borrower to submit documentation consistent with OAR 123-039-0100(3) to the Authority in a form and schedule set forth by the Authority;

(d) The Department, in its sole discretion, may require that forgivable loans issued for Aquifer Recharge testing projects include a provision that the borrower install totalizing flow meters or equivalent measurement devices to recharge and recovery wells subject to Aquifer Recharge testing as needed to ensure adequate documentation required under OAR 123-039-0100(3); and

(e) Any other provision that the Authority considers necessary or appropriate to implement the Program.

(3) If the forgivable loan amount is for less than the total amount needed to complete the applicant’s project, the following additional requirements apply:

(a) The applicant must demonstrate to the Authority that it has binding commitments for additional funds in an amount sufficient to complete the project prior to executing the forgivable loan agreement; and

(b) The forgivable loan agreement shall require that prior to disbursement of any monies from the Fund, the forgivable loan recipient must demonstrate that the project is fully funded.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0090 Loan Forgiveness

(1) If the Department is satisfied with the documentation provided under OAR 123-039-0100(3), 100 percent of the amount of the loan shall be forgiven.

(2) If the Department determines that water was used impermissibly within the terms of OAR 123-039-0100(3), the Department may require repayment of the loan in an amount proportional to the percentage of the water that was used impermissibly, with interest at a rate not to exceed five percent.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0100 Recipient Responsibilities

(1) The recipient must comply with all applicable state laws, regulations and requirements, such as Oregon prevailing wage rates, procurement regulations, and the regulations and requirements of OWRD and DEQ permitting processes.

(2) The recipient shall maintain accounts and records for all activities associated with the project and shall provide the Department reasonable access to such records upon request.

(3) The recipient shall submit periodic reports on the project in the form and frequency set by the Department detailing, among other things, water use, the use of the funding and the results of the recharge testing.

(4) Upon completion of the project activities set forth in the forgivable loan agreement, the forgivable loan recipient must submit documentation satisfactory to the Department that 100 percent of the water placed into the recharge went into the waters of this state and was not recovered under a secondary use limited license or secondary use permit obtained under ORS 537.534.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-039-0110 Waivers and Appeals

(1) The Department’s funding decisions are final and may not be appealed.

(2) In its sole discretion, the Director or designee of the Department may waive non-statutory requirements of the Program if it is demonstrated that such a waiver would serve to further the goals or objectives of the Program.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 22-2024, adopt filed 10/08/2024, effective 10/08/2024

Division 41 AQUIFER RECHARGE DUE DILIGENCE GRANT PROGRAM

Or. Admin. R. 123-041-0000 Purpose and Objective

These rules establish procedures for the administration of the Aquifer Recharge Due Diligence Grant Program (“Program”), established under Oregon Laws 2023, chapter 606, Sections 28 and 29 (Enrolled House Bill 2010), under which the Infrastructure Finance Authority within Oregon Business Development Department will award grants to eligible applicants to perform due diligence activities related to Aquifer Recharge and aquifer storage and recovery.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0010 Definitions

(1) “Aquifer Recharge” means the use of Artificial Groundwater Recharge or Aquifer Storage and Recovery methods to intentionally add water diverted from another source to a groundwater reservoir.

(2) “Artificial Groundwater Recharge” (AR) means the intentional addition of water diverted from another source to a groundwater reservoir.

(4) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(5) “Department” means the Oregon Business Development Department.

(6) “DEQ” means the State of Oregon Department of Environmental Quality.

(7) “Fund” means the Aquifer Recharge Fund.

(8) “Municipal Subdivision” means an Oregon city or county, or a county service district organized under ORS chapter 451.

(9) “OWRD” means the Oregon Water Resources Department.

(10) “Program” means the Aquifer Recharge Due Diligence Grant Program.

(11) “USGS” means the United States Geological Survey.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0020 Eligible Applicants

The following entities are eligible to apply for a Program grant:

(1) A Municipal Subdivision;

(2) A port organized under ORS chapter 777 or 778;

(3) A district as defined in ORS 198.010;

(4) An Oregon Indian tribe as defined in ORS 294.805; and

(5) A county in this state.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0030 Eligible Project Costs and Activities

(1) Eligible project costs include the necessary and reasonable costs, as determined by the Authority, for eligible project activities.

(2) Eligible project activities include, but are not limited to:

(a) Test pit construction;

(b) Borings and soil samplings necessary to design recharge basin or aquifer storage and recovery well size and location;

(c) If required by OWRD, aquifer modeling necessary to meet the standards for a request to OWRD for a limited license under ORS 537.143 and 537.144, or to test Aquifer Storage and Recovery (ASR) in accordance with testing criteria under ORS 537.505 to 537.534;

(d) Design and engineering necessary to reach the final 50 percent of design and engineering to result in a biddable project for Aquifer Recharge basins, aquifer storage and recovery wells and works, aquifer storage and recovery treatment systems and conveyance works from water source to recharge site;

(e) Sampling required by DEQ to establish parameters for monitoring and sampling source water quality and aquifer water quality;

(f) Monitoring and sampling plan development associated with permit or limited license requirements of OWRD and DEQ; and

(g) Applying to the OWRD for a limited license under OAR 690-350-120 and associated public coordination.

(h) For AR projects, applying to the OWRD for a Recharge Permit under OAR 690-350-0120 and OAR 690- 310-0040, and associated public coordination.

(i) For ASR projects, applying to the OWRD for an ASR Permit under OAR 690-350-0030, and associated public coordination.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 50-2024, minor correction filed 11/05/2024, effective 11/05/2024
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0040 Ineligible Project Costs

The following costs are ineligible for reimbursement under the Program:

(1) Cost of purchase of general-purpose motor vehicles and other equipment not directly related to the project; and

(2) Indirect costs incurred by the grant recipient or its contractors.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0050 Application Requirements

In order to receive a Program grant, an eligible applicant must submit an application to the Department that:

(1) Adequately describes the project’s scope and feasibility;

(2) Is in the form provided by the Department;

(3) Includes:

(a) Documentation establishing one of the following:

(A) A USGS ground water characterization model for the targeted aquifer establishing a baseline of aquifer properties;

(B) A peer-reviewed academic model for the targeted aquifer establishing a baseline of aquifer properties or documentation of agency-developed; or

(C) Publicly-developed reports determining that the targeted aquifer is a potential candidate for recharge testing in order to prove that baseline data exists to warrant additional due diligence for recharging the aquifer.

(b) Documentation establishing that source water is available to conduct Aquifer Recharge testing at the targeted volume and rate of the test;

(c) Documentation establishing that ground water use in the targeted aquifer has been monitored and metered for at least five years immediately prior to the date on which the application is submitted;

(d) Documentation demonstrating that all or a portion of the basin or aquifer to which the application relates has been:

(A) Restrictively classified under ORS 536.340;

(B) Withdrawn by the OWRD from further groundwater appropriation under ORS 536.410; or

(e) Documentation that demonstrates, in the Department’s sole discretion, that all landowners who own property on which injection, infiltration, recovery, or monitoring activities will take place are aware of, and agree to, the work to be completed under the proposal.

(4) Satisfies any additional requirements the Department may impose.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0060 Application Review and Approval

(1) The Department will review all submitted applications to determine if they are complete and are accompanied by all necessary supporting documentation.

(2) Once the Department has determined that an application is complete, the Department shall review the applications for the following:

(a) Project feasibility;

(b) Whether the applicant has any active Program projects. The Department may limit the number of open projects an applicant may have at any one time;

(d) Technical merit of the proposal, including the viability of target aquifer as determined by USGS aquifer characterization and the outcome of the evaluation by OWRD during the ASR or AR application process; and

(e) Any other criteria set forth in the request for grant applications or other notice of funding availability issued by the Department.

(3) Once the review is complete, the Department shall approve or reject the application. The Department will make grant award decisions in a manner that maximizes the use of available resources, including consideration of geographic diversity in award recipients. The level of grant funding will be determined by the Department on a case-by-case basis. It may offer a lower amount of assistance than requested. The amount of the award may be the minimum amount that the Department determines is necessary to enable the project to proceed, and the Department may investigate and recommend other sources of funds for all or part of a proposed project. Projects that the Department determines are not financially feasible will not be funded.

(a) If an application is approved, the Authority shall issue the applicant a notice of intent to award which will detail the amount of the award and any other information the Authority considers necessary.

(A) Grant awards will not exceed the total project cost.

(B) If the parties have not executed a grant within 90 days after negotiations begin, the Authority may rescind its notice of intent to award and reallocate Program funds.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0070 Application Prioritization

The Department may set forth prioritization or tie breaking considerations in the request for grant applications or other notices of funding availability.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0080 Grant Requirements and Disbursement of Funds

(1) Prior to the disbursement of any grant funds, the applicant must enter into a grant agreement with the Authority.

(2) The grant agreement shall be in a form provided by the Authority, and must include:

(a) A provision that disbursement will be according to the terms of the grant agreement;

(b) A provision that the liability of the Authority under the grant agreement is contingent upon the availability of moneys in the Fund for use in the project; and

(3) If the grant amount is for less than the total amount needed to complete the applicant’s project, the following additional requirements apply:

(a) The applicant must demonstrate to the Authority that it has binding commitments for additional funds in an amount sufficient to complete the project prior to executing the grant agreement; and

(b) The grant agreement shall require that prior to disbursement of any monies from the Fund, the grant recipient must demonstrate that the project is fully funded.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0090 Grant Recipient Responsibilities

(1) Grant recipients must comply with all applicable state laws, regulations and requirements, such as Oregon prevailing wage rates, procurement regulations, and the regulations and requirements of OWRD and DEQ permitting processes.

(2) Grant recipients shall maintain accounts and records for all activities associated with the project and shall provide the Department reasonable access to such records upon request.

(3) The recipient shall submit periodic reports on the project in the form and frequency set by the Department detailing, among other things, water use, the use of the funding, and the results of any testing funded.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Or. Admin. R. 123-041-0100 Waivers and Appeals

(1) The Department’s funding decisions are final and may not be appealed.

(2) In its sole discretion, the Director or designee Department may waive non-statutory requirements of the Program if it is demonstrated that such a waiver would serve to further the goals or objectives of the Program.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023, Chapter 606
OBDD 21-2024, adopt filed 10/08/2024, effective 10/08/2024

Division 42 SPECIAL PUBLIC WORKS FUND PROGRAM

Or. Admin. R. 123-042-0010 Purpose and Objectives

The purpose of these rules is to implement the Special Public Works Fund Program (“Program”), established to support the improvement, expansion, and construction of public infrastructure systems necessary to sustain and enhance economic development throughout Oregon. The Program offers financial assistance primarily through loans, with grants available in specific cases as detailed in these rules. These rules are adopted pursuant to the authority of ORS 285B.419(1) and 285A.075 to carry out the provisions of ORS 285B.410 to 285B.482.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
Reverted to EDD 4-2002, f. & cert. ef. 2-26-02
EDD 5-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 4-2002, f. & cert. ef. 2-26-02
ED 12-2000, f. 8-9-00, cert. ef. 8-14-00
EDD 9-1992, f. & cert. ef. 4-29-92
Reverted to EDD 26-1990, f. & cert. ef. 10-11-90
EDD 14-1991(Temp), f. & cert. ef. 10-17-91
EDD 26-1990, f. & cert. ef. 10-11-90
EDD 5-1988, f. & cert. ef. 2-17-88, Renumbered from 120-050-0010
EDD 3-1987(Temp), f. 8-17-87, ef. 8-20-87
IRD 9-1986, f. 6-30-86, ef. 7-1-86
IRD 1-1986(Temp), f. & ef. 1-14-86

Or. Admin. R. 123-042-0020 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001-0050. As used in this division of administrative rules the following terms have the following meanings, unless the context clearly indicates otherwise.

(1) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(2) “Award” means the selection of an application for Program funding.

(3) “Development Project” means a Project for the acquisition, improvement, construction, demolition, or redevelopment of municipally owned utilities, buildings, land, transportation facilities or other facilities that assist the economic and community development of a Municipality, including Planning Project activities that are necessary or useful as determined by the Authority.

(4) “Direct Project Management Costs” means expenses directly related to a Project that are incurred by solely to support or manage a Project. Direct Project Management Costs do not include a Municipality’s routine or ongoing expenses.

(5) “Eligible Commercial Jobs” means jobs that are created or retained by businesses selling goods or services into markets for which national or international competition exists.

(6) “Emergency Project” means a Development Project resulting from an emergency as defined in ORS 401.025, to which Federal Disaster Relief has been committed.

(7) "Federal Disaster Relief" means financial assistance provided by the federal government to support a Project as a direct result federally declared disaster or emergency. Projects include the repair, restoration, or replacement of damaged public infrastructure.

(8) “Firm Business Commitment Project” means a Project in response to a specific business development, expansion or retention proposal where assistance is necessary to enable the proposal to proceed and where permanent, full-time equivalent jobs will be created or retained. The Project must support industrial development or Eligible Commercial Jobs and be consistent with local comprehensive plans and implementing ordinances.

(9) “Fund” means the Special Public Works Fund created by ORS 285B.455.

(10) “Marine Facility” has the meaning provided in ORS 285B.410:

(11) “Municipality” means an Oregon city or county, the Port of Portland created by ORS 778.010, a county service district organized under ORS Chapter 451, a district as defined in 198.010, a drainage district organized under ORS chapter 547, a tribal council of a federally recognized Indian tribe in this state, or an airport district organized under ORS 838, but does not include an ORS 190 entity.

(12) “Natural or Green Infrastructure” means an area or system that is either naturally occurring or naturalized and intentionally managed to provide multiple benefits for the environment and human well-being, and that substitutes for, or compliments, traditional built infrastructure.

(13) “Planning Project” means a Project related to preliminary, final, or construction engineering; a survey, site investigation, or environmental action; a financial, technical or other feasibility report, study or plan; or any activity that the Authority determines to be necessary or useful in planning for a potential Development Project.

(14) “Project” means a Development, Planning, Levee or Emergency Project.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 8-2021, amend filed 12/17/2021, effective 12/17/2021
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 31-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 13-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 10-2006, f. & cert. ef. 11-1-06
EDD 18-2004, f. & cert. ef. 8-2-04
EDD 5-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 4-2002, f. & cert. ef. 2-26-02
EDD 7-2001(Temp), f. & cert. ef. 11-6-01 thru 3-29-02
ED 12-2000, f. 8-9-00, cert. ef. 8-14-00

Or. Admin. R. 123-042-0026 Loan Information

(1) The Authority will not Award loans that exceed $10,000,000 plus applicable fees.

(2) Development Projects that receive a loan are subject to the following requirements:

(a) The initial loan term may not exceed the usable life of the Project or 30 years from Project completion, whichever is less. The term of a renegotiated loan may not exceed the remaining usable life of the Project or 30 years, whichever is less.

(b) The loan must be secured the Municipality’s pledge of its full faith and credit and taxing power within the limitations of Article XI, sections 11 and 11 b, of the Oregon Constitution to pay the amounts due under the loan. The Authority will also require the Municipality to secure the loan with any other pledge of revenue or other collateral that the Authority determines is necessary and reasonable to secure the loan.

(3) Emergency Project Loans;

(a) An Emergency Project with committed Federal Disaster Relief assistance funds may receive a principal-only, zero percent (0%) interest rate loan of up to $1,000,000 or 50 percent (50%) of the total Project amount, whichever is less; and

(b) The maximum Award amount for an Emergency Project cannot exceed the required local match for the Federal Disaster Relief assistance committed to the Project.

(4) Planning Loans;

(a) The interest rate for a Planning Project loan will be half percent of the 10 year rate set by the Authority for direct loans in effect at the time of the Award and not lower than one percent; and

(b) The loan term shall not exceed ten years.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 3-2024, minor correction filed 03/06/2024, effective 03/06/2024
OBDD 8-2021, amend filed 12/17/2021, effective 12/17/2021
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 10-2011, f. 12-30-11, cert. ef. 1-1-12
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 31-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 13-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0032 Grant Information

(1) The Authority will only Award grants when a loan is not feasible due to the financial need of the Municipality or special circumstances of a Project.

(2) Notwithstanding any other provision of these rules, no grant issued from the Fund may exceed $1,000,000 or 85 percent of the allowable Project costs, whichever is less.

(3) Grants that fund the acquisition or improvement of real property, may not exceed the fair market value of the real property after the improvements have been made or the value placed on the real property and improvements on the assessment rolls, whichever is less.

(4) Job Creation grants are allowable under the following circumstances and subject to the following requirements:

(a) The grant funds a Development Project that qualifies as a Firm Business Commitment Project.

(b) The grant may not exceed $500,000 per Project or 85% of allowable Project costs, whichever is less. In-kind materials and services cannot be included in allowable Project costs.

(c) The grant amount will be based primarily on the number of Eligible Commercial Jobs proposed to be created or retained for four consecutive quarters within two years succeeding the completion of the Project. Each job created or retained may be valued up to a maximum of $5,000; and

(d) The Municipality will be required to enter into a First Source Hiring Agreement in accordance with OAR Chapter 123 Division 70. The Authority will not disburse more than 50% of the Grant funds until the Municipality has provided the Authority with a copy of the appropriate First Source Hiring Agreement.

(5) Industrial Land Planning grants are allowable under the following circumstances and subject to the following requirements:

(a) The grant amount may not exceed $60,000 or 85% of the allowable Project cost, whichever is less.

(b) The Project must:

(i) Involve land that is zoned as “industrial”;

(ii) Meet marketability standards as determined by the department using its adopted policy; and

(iii) The land involved in the Project must remain zoned as industrial and not be converted to another use for at least 5 years after completion of the Project.

(6) Emergency Project grants are allowable under the following circumstances and subject to the following requirements:

(a) The Project must have Federal Disaster Relief assistance funds committed; and

(b) The grant cannot exceed $500,000 per Project, or the amount of the federally required local match, whichever is less.

History

Statutory/Other Authority: ORS 285B.413 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-042-0036 Project Priorities and Funding

The Authority may consider the following Project priorities and preferences when the Authority anticipates a shortfall in funding:

(1) Projects which are essential for the improvement, expansion and new construction of the state’s infrastructure systems and provide the basic framework for continuing and expanding economic activity in this state, thereby improving the quality of life and economic opportunity for the people of Oregon;

(2) Projects which are essential to maintain usable and developable industrial and commercial lands in Oregon;

(3) Projects located in rural or distressed areas of Oregon;

(4) Projects that have secured funding from additional sources;

(5) Projects that demonstrate readiness, community support, and local commitment;

(6) Projects which provide financial or other assistance to enable Municipalities to construct, improve and repair those facilities that are essential for supporting continuing and expanded economic activity;

(7) Projects for which a Municipality has documented how the benefits of the Project will be preserved over the Project life;

(8) Projects that help create or retain permanent jobs;

(9) Projects that stimulate industrial growth and commercial enterprise and to promote employment opportunities in Oregon; and

(10) Emergency Projects.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 8-2021, amend filed 12/17/2021, effective 12/17/2021
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 31-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 13-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0038 Criteria for Special Project Funding

The following Development Projects must meet the following requirements: If the Project consists

(1) Solely of the acquisition of land by the Municipality, the land must be identified in the applicable land use or capital plan as necessary for a potential Development Project or be zoned solely for commercial or industrial use. A loan for such a Project must be immediately repaid if the land that is acquired through the proceeds of the loan is rezoned so as to be no longer zoned for industrial or commercial use.

(2) Of a privately owned railroad, the railroad must be designated by the owner and operator as subject to abandonment within three years, pursuant to federal law governing abandonment of common carrier railroad lines.

(3) Of a telecommunications system, the governing body of the Municipality shall adopt a resolution, after a public hearing, finding that the proposed telecommunications system Project is necessary and would not otherwise be provided by a for-profit entity within a reasonable time and for a reasonable cost.

(4) Of an energy system, the Municipality and the serving utility must execute an ownership and operating agreement for the proposed energy system Project. This requirement does not apply when the energy system Project will be located within the recognized service territory of the Municipality.

(5) Of a Marine Facility Project funded under ORS 777.267, assistance from the Fund can only be a loan that may not exceed the amount of the required local match.

(6) Of a Project for a utility system that is functionally connected to, or anticipates connecting to, another Municipality’s utility system, an intergovernmental cooperation agreement that describes the duties and obligations of each entity in regard to the Project and utility system is required. A certified copy of the fully executed intergovernmental agreement must be provided before the Authority will disburse funds.

(7) Of a Natural or Green Infrastructure Projects, the Municipality must identify and document the anticipated benefits of the Project, which may include, but are not limited to, contributions to community climate resilience, protection of drinking water sources, improvements in water quality, or floodwater retention.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075 & 285B.410 - 285B.460
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 31-2008, f. 10-2-08, cert. ef. 10-3-08

Or. Admin. R. 123-042-0042 Allowable Project Costs

Allowable Project costs include:

(1) Financing costs, including capitalized interest;

(2) Direct Project Management Costs;

(3) Costs of consultant services and expenses;

(4) Construction costs and expenses;

(5) Costs of property acquisition, including any easement, or right of way directly related to and necessary for the Project;

(6) Costs of acquiring off-site property for purposes directly related to the Project, such as wetland mitigation; and

(7) Other costs that the Authority determines to be necessary or useful.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 7-2026, renumbered from 123-042-0065, filed 04/15/2026, effective 04/15/2026
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0052 Ineligible Projects and Project Costs

Expenses and costs expressly allowed under OAR 123-042-0035 are eligible for reimbursement from the Fund. All other costs are not eligible for reimbursement, including but not limited to:

(1) Assistance to facilities that are or will be privately owned;

(2) Purchase of general-purpose motor vehicles and equipment;

(3) Assistance to Projects primarily intended to relocate business or economic activity from one part of the state to another, unless the relocation is necessary to retain the activity in Oregon;

(4) Project operating or maintenance costs;

(5) Costs that are already paid for through other Project financing, whether from the Authority, another State of Oregon agency, or a third party.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 7-2026, renumbered from 123-042-0076, filed 04/15/2026, effective 04/15/2026
OBDD 8-2021, amend filed 12/17/2021, effective 12/17/2021
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0062 Application Process and Requirements

(1) In order to receive an Award, a Municipality must consult with Business Oregon and complete the preapplication process as prescribed by Business Oregon.

(2) Once the preapplication process is complete, and Business Oregon has confirmed the Project’s eligibility, Business Oregon will provide the Municipality with all necessary information to complete an application, which will include information that allows the Authority to;

(a) Analyze the Municipality’s capacity to repay and secure the loan; and

(b) Analyze the Project’s readiness to proceed and feasibility, including review of the following:

(i) Project description;

(ii) Detailed Project budget;

(iii) Project location;

(iv) Project timeline;

(v) A certified engineering report; and

(vi) Identification of other funds needed to complete the Project.

(3) The application must be signed by the Municipality’s highest elected official or by a duly authorized person.

(4) The Authority will only process completed applications.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 7-2026, renumbered from 123-042-0122, filed 04/15/2026, effective 04/15/2026
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0072 Application Review and Award Selection

(1) The Authority will review all submitted applications to determine if they are complete, accompanied by all required supporting documentation, and satisfy all Program requirements.

(2) Once the evaluation is complete, the Authority will approve or reject the application. The Authority will make Award decisions in a manner that maximizes the use of available resources applying prudent fiscal management of the Fund.

(3) If an application is approved, the Authority will issue the Municipality a notice of intent to award which will detail the amount of the Award and any other information the Authority considers necessary, including any special conditions.

(4) The Authority may offer an alternate mix or lower amount of assistance than requested, and recommend other sources of funds for all or part of a proposed Project.

(5) After issuing a notice of intent to award, the Authority will begin negotiating a contract with the Municipality.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 7-2026, renumbered from 123-042-0132, filed 04/15/2026, effective 04/15/2026
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 9-2015(Temp), f. & cert. ef. 10-1-15 thru 3-27-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 10-2006, f. & cert. ef. 11-1-06

Or. Admin. R. 123-042-0082 Contracts and Disbursements of Funds

(1) The Authority shall disburse monies on reimbursement or cost incurred basis from the Fund only after entering into a binding contract with the Municipality.

(2) The contract will be in form and substance as provided by the Authority, and must include:

(a) A provision requiring continued use and ownership of the for either the life of the loan, or for not less than 10 years following the Project Closeout Deadline, whichever is longer.

(b) If any portion of the assistance is in the form of a loan or the purchase of a bond of a Municipality, a provision granting the Authority a lien on, or a security interest in, the collateral as determined by the Authority to be necessary to secure repayment of the loan or bond;

(c) A provision that for a period of up to six (6) years after Project completion, the Authority may request that the Municipality, at its own expense, submit data on the economic development benefits of the Project, including but not limited to, information on new or retained jobs resulting from the Project, and other information necessary to evaluate the success and economic impact of the Project;

(d) A provision that provides that no Program funds will be disbursed to the Municipality until all other funds necessary to complete the Project are available to the Municipality for completion of the Project;

(e) A requirement that the Municipality must maintain all accounts and records for the Project activities and shall provide the Authority, and its representatives, reasonable access to such records upon request;

(f) A requirement that the Municipality shall submit periodic reports on the Project as requested by the Authority;

(g) A certification that:

(i) any service provider retained for their professional expertise shall be certified, licensed, or registered, as appropriate, in the State of Oregon for their specialty; and

(ii) The Municipality shall follow standard construction practices, such as bonding of engineers and contractors, requiring errors and omissions insurance, performing testing and inspections during construction, and obtaining as-built drawings; and

(h) For a construction Project, a requirement that the Municipality shall have a financing plan for the ongoing operation, maintenance and repairs that will preserve the Project benefits over its useful life.

(3) The contract must be authorized by an ordinance, order, or resolution adopted by the governing body of the Municipality in accordance with the Municipality’s requirements for public notice and authorizing debt.

History

Statutory/Other Authority: ORS 285B.419 & 285A.075
Statutes/Other Implemented: ORS 285B.410 - 285B.482
OBDD 11-2026, amend filed 06/18/2026, effective 06/18/2026
OBDD 7-2026, renumbered from 123-042-0155, filed 04/15/2026, effective 04/15/2026
OBDD 4-2016, f. & cert. ef. 2-29-16
OBDD 41-2010, f. 11-30-10, cert. ef. 12-1-10
EDD 10-2006, f. & cert. ef. 11-1-06

Division 43 WATER/WASTEWATER FINANCING PROGRAM

Or. Admin. R. 123-043-0000 Purpose and Objectives

Pursuant to ORS 285B.563, the Oregon Business Development Department is required to adopt rules that provide procedures, standards and criteria for the Water/Wastewater Financing Program.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 7-2002, f. & cert. ef. 4-26-02
EDD 7-1994, f. & cert. ef. 4-7-94
EDD 10-1993(Temp), f. & cert. ef. 10-4-93

Or. Admin. R. 123-043-0010 Definitions

(1) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(2) "DEQ" means the State of Oregon Department of Environmental Quality.

(3) "Fund" means the water fund created by ORS 285B.563.

(4) “Municipality” means an Oregon city or county, the Port of Portland created by ORS 778.010, a county service district organized under ORS chapter 451, a district as defined in ORS 198.010, a drainage district organized under ORS chapter 547, a tribal council of a federally recognized Indian tribe in this state or an airport district organized under ORS chapter 838.

(5) “Safe drinking water project” means a project for constructing or improving a drinking water system or a water development project, as defined in ORS 541.700 (6)(a), (b) and (d) to (f), that is owned and operated by a municipality.

(6) "Technical assistance" means preliminary engineering or planning; legal, financial, and economic investigations, reports and studies to determine the feasibility of a water project. Technical assistance also means Water Master Plans or Wastewater Facilities Plans.

(7) “Wastewater system improvement project” means a project for constructing or improving a system for wastewater collection or treatment, including storm drainage systems.

(8) “Water project” means a safe drinking water project or a wastewater system improvement project.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 3-2012, f. 3-30-12, cert. ef. 4-2-12
OBDD 6-2011(Temp), f. & cert. ef. 11-3-11 thru 4-30-12
Reverted to EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 32-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 14-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02
EDD 7-1994, f. & cert. ef. 4-7-94
EDD 10-1993(Temp), f. & cert. ef. 10-4-93

Or. Admin. R. 123-043-0015 Eligible Project Costs and Activities- Water Projects

Eligible costs include the reasonable costs as determined by the Authority for eligible water projects owned and operated either by the municipality or under a management contract or an operating agreement with the municipality and may include:

(1) Water project development costs including but not limited to costs associated with design and engineering, architectural and planning work, permitting, environmental review, regulatory processes, public outreach, community engagement, technical assistance and support activities necessary to support a project;

(2) Construction, improvement or expansion of drinking water projects including all facilities necessary for source, supply, filtration, treatment, storage, transmission, and metering;

(3) Construction, improvement or expansion of wastewater system improvement projects including all facilities necessary for collecting, conveying, pumping, treating and disposing of sanitary sewage, including correction of infiltration and inflow through replacement of lines, sliplining, or other corrective processes;

(4) Construction, improvement or expansion of storm drainage systems including all facilities necessary for controlling, collecting, conveying, treating and discharging of stormwater;

(5) The acquisition of real property directly related to or necessary for the proposed water project;

(6) Construction contingencies for the water project;

(7) Financing costs associated with the department's financing including capitalized interest, issuance and debt service reserve costs, when such costs are incurred in funding a project;

(8) Costs incurred by the municipality prior to a water project award if such costs are allowable under the department’s adopted policy for reimbursement of pre-award costs; and

(9) Direct project management costs as defined in ORS 285B.560(1).

History

Statutory/Other Authority: ORS 285B.563
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0025 Ineligible Project Costs

Expenses and costs expressly allowed by OAR 123-043-0015 are eligible for reimbursement from the fund. All other costs, including but not limited to those listed below, are ineligible for reimbursement:

(1) Costs incurred for facilities that are or will be privately owned;

(2) Cost of purchase of general purpose motor vehicles and other equipment not directly related to the project;

(3) Cost of purchase of off-site property for uses not directly related to the project; and

(4) Project operating or maintenance expenses.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 8-2019, minor correction filed 07/03/2019, effective 07/03/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 3-2012, f. 3-30-12, cert. ef. 4-2-12
OBDD 6-2011(Temp), f. & cert. ef. 11-3-11 thru 4-30-12
OBDD 42-2010, f. 11-30-10, cert. ef. 12-1-10
Reverted to EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0035 Criteria and Limitations for Funding — Water Projects

Eligibility of projects funded with the fund is determined by the Authority using the criteria below:

(1) A municipal drinking water system, wastewater system, or storm drainage system has received a notice of non-compliance with:

(a) Drinking water quality standards administered by the Oregon Health Authority Drinking Water Services; or

(b) Water quality statutes, rules, orders, or permits administered by DEQ or the Environmental Quality Commission.

(2) If a municipal drinking water system, wastewater system, or storm drainage system has not been issued a notice of non-compliance as identified in OAR 123-043-0035(1), the Authority may determine that a proposed project is eligible for assistance upon a finding that one of the following has been met:

(a) Documentation has been issued by the appropriate regulatory authority, such as the Oregon Health Authority Drinking Water Services, DEQ, or a contracted agent of those agencies, which indicates a high probability that the system will soon be notified of non-compliance, or the project will assist with achieving or maintaining compliance with:

(A) Drinking water quality standards administered by the Oregon Health Authority Drinking Water Services; or

(B) Water quality statutes, rules, orders, or permits administered by DEQ or the Environmental Quality Commission.

(b) If a municipal drinking water system, wastewater system, or storm drainage system does not have documentation as identified in OAR 123-043-0035(1) or (2), the Authority may determine that a proposed project is eligible for assistance upon a finding that a project would address an urgent need including:

(A) Projects intended to address a community drinking water health risk;

(B) Projects intended to address a community drinking water supply concern;

(D) Stormwater projects intended to reduce community vulnerability to flooding.

(3) The project must be consistent with the acknowledged local comprehensive plan.

(4) When the Authority determines funds are limited, it will apply the following prioritization criteria when selecting water projects to receive funding:

(a) A preference for projects located within rural economically distressed areas as defined by the Oregon Business Development Department;

(b) A preference for projects that support a municipality’s efforts to achieve or maintain compliance with:

(A) Drinking water quality standards administered by the Oregon Health Authority Drinking Water Services; or

(B) Water quality statutes, rules, orders, or permits administered by DEQ or the Environmental Quality Commission.

(d) A preference for partnerships and collaborative projects.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 32-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 14-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 9-2004, f. & cert. ef. 3-22-04
EDD 8-2003(Temp), f. & cert. ef. 9-24-03 thru 3-22-04
Reverted to EDD 7-2002, f. & cert. ef. 4-26-02
EDD 1-2003(Temp), f. 2-20-03, cert. ef. 2-24-03 thru 6-30-03
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0041 Criteria and Limitations for Funding — Technical Assistance Projects

(1) Technical assistance awards are available to municipalities with populations of 15,000 or less.

(2) The Authority may make technical assistance awards for:

(a) Water Master Plans or Wastewater Facility Plans;

(b) Preliminary engineering or planning; legal, financial, and economic investigations, reports and studies to determine the feasibility of a project, if the Authority determines there is adequate documentation from a regulatory authority recognized by the Authority as having responsibility for the protection of water quality or the supply of clean drinking water that shows the technical assistance project is needed; or

(3) Pre-award expenses are not eligible for reimbursement.

(4) When the Authority determines funds are limited, it will apply the following criteria when selecting technical assistance project to receive funding:

(a) A preference for technical assistance projects located within rural economically distressed areas as defined by the Oregon Business Development Department;

(b) A preference for technical assistance projects to address documented non-compliance;

(d) A preference for partnerships and collaborative technical assistance projects.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 10-2014, f. 5-30-14, cert. ef. 6-1-14
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-043-0055 Loan and Grant Information

(1) The Authority may award financing in a manner that maximizes the use of available resources and maintains the desired credit standards of the fund. The Authority shall determine the amount, type, interest rate and terms of any financing awarded. It may offer an alternate mix or lower amount of assistance than requested. The amount of the award may be the minimum amount that the department determines is necessary to enable the project to proceed, and the Authority may investigate and recommend other sources of funds for all or part of a proposed project. Projects that the Authority determines are not financially feasible will not be funded.

(2) Loans for water projects:

(a) The term of a loan is limited to the usable life of the contracted project, or 30 years from the year of project completion, whichever is less.

(b) The interest rate on a loan is based on market conditions for similar debt. In addition to, or in lieu of a grant, the Authority may offer a subsidized interest rate if the community meets the criteria identified in (3)(b) and (3)(c) below.

(c) The interest rate on a bond funded loan is equal to the coupon rates on the state revenue bonds funding the loan. Until the state revenue bonds funding the loan are sold, the municipality will pay interest at a rate established by the Authority on loan funds disbursed to the municipality.

(d) The maximum amount for a loan for a project will be determined by the Authority on the basis of the department's financial analysis of the municipality's capacity for repaying the debt, the availability of moneys in the fund and prudent fund management, but will not exceed $10,000,000.

(e) A loan must be secured by a full faith and credit obligation that is payable from any taxes which the municipality may levy within the limitations of Article XI of the Oregon Constitution and all legally available revenues and other funds of the municipality. A pledge of specific revenues of the municipality may be required by the Authority to be pledged in addition to the foregoing.

(3) Grants for water projects: When making a determination to award a grant, the Authority will apply prudent fiscal management of the fund in order to manage limited funding resources. The Authority shall determine if the project meets the criteria of a grant and make a determination on the amount of the grant based on financial need or other special circumstances. In making its determination, the Authority shall apply the following criteria:

(a) The Authority's financial analysis determines that the municipality's financial resources, including its borrowing capacity, are insufficient to finance the project;

(b) The projected annual residential utility rate for the system is at least equivalent to a minimum rate as determined by the Authority's policy. The Authority's policy may include such factors as the most recent U.S. Census data on median household income and annual adjustments for inflation since the most recent census;

(d) Grants may be awarded up to $750,000 based on the department’s policy, but not more than 50 percent of the financial award from the fund.

(4) Loans for technical assistance projects:

(a) A loan may be awarded for a technical assistance project. Loan interest shall be 1 percent. The loan term shall not exceed ten years.

(b) A loan must be secured by a full faith and credit obligation that is payable from any taxes which the municipality may levy within the limitations of Article XI of the Oregon Constitution and all legally available revenues and other funds of the municipality. A pledge of specific revenues of the municipality may be pledged in addition to the foregoing.

(5) Grants for technical assistance projects:

(a) A grant of up to $50,000 per drinking water, wastewater, and storm drainage system may be awarded once every three (3) years for a project.

(b) The Authority may limit the number of open technical assistance grants a municipality may have at any one time.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 32-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 14-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 9-2004, f. & cert. ef. 3-22-04
EDD 8-2003(Temp), f. & cert. ef. 9-24-03 thru 3-22-04
EDD 1-2003(Temp), f. 2-20-03, cert. ef. 2-24-03 thru 6-30-03
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0065 Application Requirements

(1) A municipality may submit an application to the Authority at any time after the Authority has made a preliminary determination of eligibility and shall comply with the Authority's procedures for submitting applications.

(2) For a project that is part of a system that is, or will be, functionally connected to, another municipality's system, an intergovernmental cooperation agreement that describes the duties and obligations of each entity is required. The fully executed intergovernmental agreement must be provided before the financing contract will be executed by the Authority.

(3) The application shall be in the form provided by the Authority and shall contain or be accompanied by such information and documentation as the Authority may require. The Authority will process only completed applications.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0075 Application Review and Approval

(1) For a water project, the Authority must make the following determinations:

(a) Project feasibility as demonstrated by certification from a professional engineer registered in the State of Oregon in an engineering report, such as a Master Plan, that the proposed project is feasible and is the most cost effective solution, or other feasibility documentation approved by the Authority.

(b) The loan is secured by the pledge of utility revenues or other revenues or payments from owners of specially benefited properties, and these revenues or payments are sufficient, when considered with other security, to assure repayment of the loan and the municipality has certified to the Authority that there will be adequate funds available to repay the loans made to the municipality from the fund.

(d) The applicant is an eligible municipality and is willing and able to enter into a contract with the Authority.

(e) The project is consistent with the requirements governing assistance from the fund. If the Authority determines that the municipality or the proposed project does not meet the requirements of this OAR 123-043-0075, the Authority may reject an application or require further documentation from the municipality.

(f) The project is ready to begin and the municipality has committed in writing that, if awarded the assistance it shall proceed immediately.

(2) To award assistance from the fund for a technical assistance project, the Authority must determine that the municipality has, or has demonstrated the ability to secure, the administrative capacity to undertake and complete the project.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 32-2008, f. 10-2-08, cert. ef. 10-3-08
EDD 14-2008(Temp), f. & cert. ef. 4-9-08 thru 10-5-08
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 9-2004, f. & cert. ef. 3-22-04
EDD 8-2003(Temp), f. & cert. ef. 9-24-03 thru 3-22-04
EDD 1-2003(Temp), f. 2-20-03, cert. ef. 2-24-03 thru 6-30-03
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0085 Contract Requirements and Disbursement of Funds

(1) The Authority shall disburse monies from the fund for water projects or technical assistance projects only after entering into a binding contract with the municipality.

(2) The contract shall be in a form provided by the Authority.

(3) If any portion of the assistance is in the form of a loan or the purchase of a bond of a municipality, a provision granting the Authority a lien on or a security interest in the collateral as determined by the Authority to be necessary to secure repayment of the loan or bond shall be included in the contract.

(4) Drinking water projects are subject to the following contract provisions:

(a) A provision requiring the municipality to install meters on all new active service connections from any distribution lines that may be included in the project; and

(b) For a drinking water project with existing, active unmetered service connections, a provision requiring the municipality to install meters on such service connections no later than two years after the completion of the project;

(5) Other funds that may be needed to complete the project must be available or the municipality must have a binding commitment for such funds at the time the contract is executed. If a portion of the other funds needed to complete the project is committed but not yet available at the time an award is made or the contract executed, the contract shall require that no disbursement of funds for construction activities may occur until all project funds are available.

(6) The contract for a loan shall be authorized by an ordinance, order or resolution adopted by the governing body of the municipality in accordance with the municipality's requirements for public notice and authorizing debt.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 20-2024, amend filed 09/12/2024, effective 09/12/2024
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0095 Recipient Responsibilities

(1) The municipality must comply with all applicable state laws, regulations and requirements, such as Oregon prevailing wage rates, municipal audit law, and procurement regulations.

(2) The municipality shall certify that a registered professional engineer will be responsible for the design and construction of the project and it shall follow standard construction practices, such as bonding of engineers and contractors, requiring errors and omissions insurance, performing testing and inspections during construction, and obtaining as-built drawings.

(3) For a project funded with state lottery proceeds, the municipality shall comply with ORS 280.518 for public display of information on lottery funding of the project. At a minimum the municipality shall:

(a) Include the following statement, prominently placed, on all plans, reports, bid documents and advertisements relating to the Project: "This project was funded in part with a financial award from the Water Fund, funded by the Oregon State Lottery and administered by the State of Oregon, Business Development Department." and

(b) For a construction project, post a sign, provided by the Authority, at the project site or, if more than one site is included in the project, at a site visible to the general public stating that the project is being funded by lottery proceeds.

(4) For a construction project the municipality shall have a plan for ongoing operation, maintenance, and replacement that will preserve the project's benefits over its useful life.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
Reverted to EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Or. Admin. R. 123-043-0102 Eligibility Criteria for State Revenue Bond Loans

The Authority shall apply the following standards for determining the eligibility of projects for state revenue bond financing:

(1) Loan repayment must be secured by a full faith and credit pledge of the municipality;

(2) The loan must be of sufficient size as determined by the Authority;

(3) The loan must be fully amortized over its term with fixed annual principal and interest payments, and the term of the loan must not exceed the usable life of the contracted project or 30 years from the year of project completion, whichever is less;

(4) The loan must conform to the requirements of the bond indenture for the state revenue bonds; and

(5) The loan and the municipality must meet the minimum underwriting criteria for state revenue bond financing as established by Department policies.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 30-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06

Or. Admin. R. 123-043-0115 Appeals and Exceptions

The director or the director’s designee will consider appeals of the Authority's funding decisions. Only the municipality may appeal. Appeals must be submitted in writing to the director within 30 days of the event or action that is being appealed. A project that would have been funded but for a technical error in the Authority's review of the application, as determined by the director, will be funded as soon as sufficient moneys become available in the fund, provided the project is still viable. The director or the director’s designee decision is final.

History

Statutory/Other Authority: ORS 285B.563 & 285A.075
Statutes/Other Implemented: ORS 285B.560 - 285B.599
OBDD 11-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 12-2013, f. 12-30-13, cert. ef. 1-1-14
OBDD 3-2012, f. 3-30-12, cert. ef. 4-2-12
OBDD 6-2011(Temp), f. & cert. ef. 11-3-11 thru 4-30-12
Reverted to EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
OBDD 2-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10
EDD 25-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 11-2006, f. & cert. ef. 11-3-06
EDD 7-2002, f. & cert. ef. 4-26-02

Division 46 TIDE GATE GRANT AND LOAN PROGRAM

Or. Admin. R. 123-046-0000 Purpose and Objectives

These rules establish procedures for the Oregon Business Development Department in accepting applications and considering proposals for funding under the Tide Gate Grant and Loan Program established under section 21, House Bill 4304, 2020 2nd Special Session, which, among other things, includes funding for the planning and construction of tide gates and associated culverts and drainage infrastructure.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0010 Definitions

(1) “Department” means the Oregon Business Development Department.

(2) “Fund” means the Tide Gate Grant and Loan Fund.

(3) “Municipality” means an Oregon city or county, a Port organized under ORS chapter 777 or 778, a county service district organized under ORS chapter 451, a district as defined in ORS chapter 198, a tribal council of a federally recognized Indian tribe in this state or an airport district organized under ORS chapter 838.

(4) “Non-Profit Organization” means an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends.

(5) “Persons” means Individuals, corporations, associations, firms, partnerships, or joint stock companies.

(6) "Tide gate construction project" means improvements to a tide gate drainage system intended to ensure land drainage and flood protection including repair or replacement of tide gates, culverts, or other barriers to proper drainage of lands and flood protection.

(7) “Tide gate drainage system” means interconnected tide gates and associated culverts and infrastructure needed to drain tidelands and ensure flood protection.

(8) "Tide gate planning project" means design and engineering, legal costs, permitting, environmental review, regulatory processes, landowner coordination, and support activities needed to develop a tide gate project ready for construction.

(9) “Tide gate project” means either a tide gate construction project or a tide gate planning project.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0020 Eligible Project Costs and Activities

Eligible costs include the reasonable costs and necessary, as determined by the Department, for eligible tide gate projects and may include:

(1) Tide gate project development costs including, but not limited to: direct costs associated with design and engineering, legal costs, permitting, environmental review, regulatory processes, landowner coordination, and support activities necessary to develop a tide gate construction project;

(2) Funding award administration costs not to exceed $10,000;

(3) Construction, repair or replacement of tide gates, culverts, or other barriers to land drainage and flood protection associated with a tide gate drainage system;

(4) Support activities necessary to construct a tide gate project;

(5) Activities intended to stabilize drainage channels;

(6) Construction contingencies for a tide gate construction project; and

(7) Financing costs associated with the Department's financing including capitalized interest, issuance and debt service reserve costs, when such costs are incurred in funding a project.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0030 Ineligible Project Costs

Tide gate project expenses and costs expressly allowed by OAR 123-046-0020 are eligible for reimbursement from the fund. All other project costs, including but not limited to those listed below, are ineligible for reimbursement:

(1) Cost of purchase of general purpose motor vehicles and other equipment not directly related to the project;

(2) Indirect costs incurred by the applicant or a contractor; and

(3) Project operating or maintenance expenses.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0040 Loan and Grant Applicant Eligibility

(1) Parties eligible for a loan or grant under these rules include municipalities, Persons, and non-profit organizations.

(2) The Department may limit the number of open projects an applicant may have at any one time.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0050 Tide Gate Construction Projects

(1) Each application for construction funding shall address a single tide gate drainage system. A tide gate drainage system may include multiple tide gates and associated drainage infrastructure but may not include unrelated tide gate systems in the same or another watershed for which operation does not impact the drainage of the subject system as determined by the Department.

(2) Tide gate construction project applications shall be in the form provided by the Department and shall contain or be accompanied by such information and documentation as the Department may require. The Department will process only completed applications.

(3) A tide gate construction project application may include a grant funding request of up to $500,000.

(4) Grant funding requests of $100,000 or less for tide gate construction projects shall be subject to the following procedures:

(a) The Department may process applications and make funding awards in the order they are received and deemed complete;

(b) The Department may annually allocate available funds for those tide gate construction projects requesting a grant of $100,000 or less.

(5) Grant funding requests of over $100,000, and less than or equal to $500,000 shall be subject to the following procedures:

(a) The Department will determine available funds for a given funding cycle and may conduct a competitive application solicitation cycle one or more times annually; and

(b) Proposed projects will be prioritized based on watershed and community/economic benefit as described in OAR 123-046-0090(2).

(6) Grant funding requests shall demonstrate matching funds in the amount of 10% of the total project cost. The following activities are eligible to be considered as match:

(a) Cash match for eligible project costs and activities described in OAR 123-046-0020;

(b) A loan from the fund; and

(c) In-Kind match from the funding recipient or other entity, if the in-kind match is approved by the Department prior to funding award.

(7) A tide gate construction project application may include a loan funding request of up to $500,000.

(8) The total funding request for a single tide gate construction project application shall not exceed $1 million.

(9) The Department may coordinate with other state and federal agencies, organizations, or contracted services to assist the Department in determining tide gate construction project eligibility, developing prioritization category criteria, or prioritizing tide gate construction project assistance requests.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0060 Tide Gate Construction Project Application Eligibility Criteria

The Department will determine tide gate construction project application eligibility using criteria including but not limited to the following:

(1) The application must demonstrate shovel readiness including:

(a) Completion of all technical and engineering design work;

(b) Completion of all permitting and regulatory processes unless progress at time of application is adequate to proceed to construction as determined by the Department; and

(c) Evidence that all landowners on whose land tide gate drainage infrastructure will be constructed are aware of, and agree to, the proposal.

(2) Unless otherwise approved under OAR 123-046-0120(1)(a), the application must include feasibility documentation stamped and signed by an engineer licensed in the State of Oregon. Unless otherwise approved by the Department, feasibility documentation must include the following elements:

(a) Analyses of project feasibility including but not limited to engineering, regulatory, and legal feasibility;

(b) Analyses of project alternatives and the recommended option;

(d) Construction timeline; and

(e) Operational feasibility analysis including identification of a plan for operation and maintenance of the tide gate drainage system.

(3) Application must demonstrate that authorized access exists for all properties on which construction activities will occur or equipment will be mobilized.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0070 Tide Gate Planning Projects

(1) Tide gate planning project applications shall be in the form provided by the Department and shall contain or be accompanied by such information and documentation as the Department may require. The Department will process only completed applications.

(2) The Department will determine available funds for a given funding cycle and may conduct a competitive application solicitation cycle one or more times annually.

(3) A tide gate planning project application may include a grant funding request of up to $100,000.

(4) A tide gate planning project application may include a loan funding request of up to $100,000.

(5) The total funding request for a single tide gate planning project application shall not exceed $200,000.

(6) The Department may coordinate with other state and federal agencies, organizations, or contracted services to assist the Department in determining tide gate planning project eligibility, developing prioritization category criteria, or prioritizing tide gate planning project assistance requests.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0080 Tide Gate Planning Project Application Eligibility Criteria

The Department will determine tide gate planning project application eligibility using criteria including but not limited to the following:

(1) The application must demonstrate that the study scope will include all elements needed to develop a shovel ready tide gate project consistent with OAR 123-046-0060(1).

(2) All required permits and regulatory authorizations must be addressed through the study scope.

(3) The study scope must result in feasibility documentation consistent with OAR 123-046-0060(2).

(4) The study scope must include a plan to communicate with all impacted landowners throughout the course of the planning project.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0090 Tide Gate Project Application Prioritization Criteria

(1) The Department may prioritize tide gate project applications using considerations including but not limited to the following:

(a) The technical merit of the proposal including the extent to which the approach would address the project need;

(b) Cost effectiveness including how the costs are aligned with the work necessary to accomplish objectives; and

(2) Funding applications under OAR 123-046-0050(5) will be prioritized using criteria including but not limited to:

(a) The watershed benefit associated with the project.

(b) The community and economic benefit associated with the project.

(3) The Department may consider geographic diversity in the prioritization and selection of applications for funding.

(4) The Department may prioritize the funding of any tide gate project intended to protect a community or key infrastructure from flooding.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0100 Tide Gate Coordinator and Technical Studies

(1) The Department may contract with one or more tide gate coordinators for purposes including but not limited to:

(a) Providing technical assistance and program information to tide gate owners;

(b) Providing interagency liaison services to direct tide gate projects through the permitting and funding processes; and

(c) To assist the Department in determining project feasibility, eligibility, or to gather watershed or economic information for Department prioritization efforts.

(2) The Department may contract for technical studies that have a statewide benefit for tide gate project development.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0110 Loan and Grant Information

(1) The Department may award financing in a manner that maximizes the use of available resources and maintains the desired credit standards of the fund. The Department shall determine the amount, type, interest rate and terms of any financing awarded. It may offer an alternate mix or lower amount of assistance than requested. The amount of the award may be the minimum amount that the DTepartment determines is necessary to enable the project to proceed, and the Department may investigate and recommend other sources of funds for all or part of a proposed project. Projects that the Department determines are not financially feasible will not be funded.

(2) Loans for tide gate projects:

(a) The term of a loan for a tide gate construction project is limited to the usable life of the contracted project, or 30 years from the year of project completion, whichever is less;

(b) The term of a loan for a tide gate planning project shall not exceed 7 years from the year of project completion;

(d) Security pledges shall be required for all approved financing with the form and amount of security determined by the Department consistent with the nature of the project and the creditworthiness of the borrower.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0120 Application Review and Approval

(1) For a tide gate project, the Department must make the following determinations:

(a) That a tide gate construction project is feasible as demonstrated by certification from a professional engineer registered in the State of Oregon in a feasibility study, such as a feasibility study consistent with 123-046-0060(2), or other feasibility documentation approved by the Department.

(b) Any loan is secured by the pledge of utility revenues or other revenues or payments from owners of specially benefited properties, and these revenues or payments are sufficient, when considered with other security, to assure repayment of the loan and the borrower has certified to the Department that there will be adequate funds available to repay the loans made to the municipality from the fund.

(d) The applicant is willing and able to enter into a contract with the Department.

(e) The project is consistent with the requirements governing assistance from the fund. If the Department determines that the applicant or the proposed project does not meet the requirements of this OAR 123-046-0120, the Department may reject an application or require further documentation from the applicant.

(2) To award assistance from the fund for a tide gate project, the Department must determine that the applicant has, or has demonstrated the ability to secure, the administrative capacity to undertake and complete the project.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0130 Contract Requirements and Disbursement of Funds

(1) The Department’s obligation to fund tide gate projects occurs only after entering into a binding contract with the recipient.

(2) The contract shall be in a form provided by the Department.

(3) If any portion of the assistance is in the form of a loan, a provision granting the Department a lien on or a security interest in the collateral as determined by the Department to be necessary to secure repayment of the loan or bond shall be included in the contract.

(4) Other funds that may be needed to complete the project must be available or the funding recipient must have a binding commitment for such funds at the time the contract is executed. If a portion of the other funds needed to complete the project is committed but not available at the time an award is made or the contract executed, the contract shall require that the project be fully funded prior to any disbursement from the fund.

(5) By contract, recipient will be required to follow state procurement laws in ORS 279A, ORS 279B and ORS 279C.

(6) If the borrower is an entity, rather than an individual, the contract for a loan shall be authorized by an ordinance, order or resolution adopted by the governing body or partners of the entity, and in accordance with any applicable requirements for notice and authorizing debt.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Or. Admin. R. 123-046-0140 Recipient Responsibilities

(1) The recipient must comply with all applicable state and federal laws, regulations and requirements.

(2) The funding recipient shall follow standard construction practices, such as bonding of engineers and contractors, requiring errors and omissions insurance, performing testing and inspections during construction, and obtaining as-built drawings.

(3) Project materials must include a notation indicating that Business Oregon funding from the Oregon Lottery was used for the project.

(4) For a tide gate construction project the funding recipient shall have a plan for ongoing operation and maintenance that will preserve the project's benefits over its useful life.

History

Statutory/Other Authority: ORS 285A.075 & Ch 10, OL 2020
Statutes/Other Implemented: Ch 10, OL 2020
OBDD 4-2021, adopt filed 03/15/2021, effective 03/15/2021
OBDD 21-2020, temporary adopt filed 10/05/2020, effective 10/05/2020 through 04/01/2021

Division 47 BROADBAND PROGRAMS

Or. Admin. R. 123-047-0010 Purpose

(1) The rules of OAR Chapter 123, division 47 are established pursuant to:

(a) the Oregon Business Development Department’s (“Department”) rulemaking authority under ORS 285A.075(1)(a) to adopt rules necessary to carry out the duties, function and powers vested by law in the Department; and

(b) Oregon Laws 2023, chapter 338 (Regular Session), requiring both that the Department establish by rule one or more programs for providing financial assistance in the form of loans or grants for the purpose of supporting broadband access, affordability and adoption and that the Department establish by rule a program for providing grants or loans funded by moneys transferred to the Broadband Fund pursuant to ORS 759.425 for the purposes described in the amended Oregon Laws 2020, chapter 17, section 5 (First Special Session).

(2) This division of rules describes the Department’s financial assistance through various grant and loan programs funded by the Broadband Fund, describes the requirements for managing and providing program award funds allocated to the Department, and describes how the Department will carry out the duties, functions, and powers of the Broadband Office for broadband projects pursuant to ORS 285A.166.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17 & Section 5(2) (First Special Session) (SB 1603)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0020 Definitions

Some terms used in OAR Chapter 123, division 47 are defined in Procedural Rules, OAR Chapter 123, division 1 and herein. In addition, as used in this division of administrative rules, unless the context requires otherwise, the following definitions apply:

(1) “Broadband Program” means a financial assistance program that supports broadband access, affordability, or broadband adoption projects in the form of loans or grants.

(2) “Broadband Service Infrastructure Programs” means a Broadband Program type that permits financial assistance to be used for the costs of physical broadband infrastructure.

(3) “Financing contract” is a binding agreement between the Department and an award recipient to receive a financial assistance award through a grant and/or loan.

(4) “Physical broadband infrastructure” means networks of deployed telecommunications equipment and technologies necessary to provide broadband services and includes cable, fiber optics, wiring, or other permanent infrastructure, including wireless infrastructure that is capable of providing internet connections to serve individual locations.

(5) “Program Handbook” is a regularly updated and publicly posted document that provides up-to-date information on a Broadband Program’s characteristics, including but not limited to application instructions, criteria for applications and for determining the eligibility of applicants and proposed projects for a loan or grant, criteria for the department to evaluate competitive applications and for awarding a loan or grant, performance requirements, financial assistance disbursement processes, reporting requirements, applicable federal requirements, and other program information. If a Broadband Program has a Program Handbook, the handbook will be published and adopted by the Department as a rule.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0030 Funding Sources

(1) Each Broadband Program operated by the Department may vary depending on the source(s) of funding for the Broadband Program and the respective requirements of the funding source(s).

(2) Broadband Fund. Funds in the Broadband Fund, established by Section 4, chapter 17, Oregon Laws 2020 (first special session), as amended, shall be used by the Broadband Office for the purposes provided therein, including providing funds for programs providing financial assistance in the form of loans or grants for the purpose of supporting broadband access, affordability and adoption in this state and to support the Broadband Office in carrying out the duties of the office listed under ORS 285A.166.

(3) Universal Service Fund. Funds in the Broadband Fund that were transferred to the Broadband Fund pursuant to ORS 759.425 from the Universal Service Fund are dedicated for a Universal Service Fund Broadband Program. The Universal Service Fund Broadband Program shall provide grants and loans for projects as described in Section 5, chapter 17, Oregon Laws 2020 (first special session), as amended.

(4) Coronavirus Capital Projects Fund. Funds provided to the Department from the federal Coronavirus Capital Projects Fund (42 U.S.C. 804) that will be used to provide loans or grants towards the costs of physical broadband infrastructure (“ARPA Capital Projects Fund Broadband Deployment Program"), are subject to the requirements of section 1a(1), chapter 338, Oregon Laws 2023.

(5) Broadband, Equity Access, and Deployment Program. Funds from the federal Broadband, Equity Access, and Deployment Program (47 U.S.C. 1702) used by the Department to provide loans or grants towards the costs of physical broadband infrastructure, are subject to the requirements of section 1a(2), chapter 338, Oregon Laws 2023.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0040 Application Process

(1) Application Cycle and Process; Funding Notice. Each Broadband Program providing grant or loan financial assistance will be subject to an application cycle and process determined by the Department. However, Broadband Service Infrastructure Programs shall each include a funding notice, a process for providing public notice of pending applications, a public process for interested persons to submit comments on pending applications, and a process for challenging an application. Application cycle and process details will be described in specific funding notices. Each Broadband Program application cycle will conclude with notices of award(s) and ultimately financing contract(s) with recipient(s). A notice of award shall be a final order in an other than contested case proceeding and reviewable pursuant to ORS 183.480 with jurisdiction for judicial review conferred by ORS 183.484.

(2) Geospatial Data. To comply with Oregon Laws 2022, Chapter 60, Section 4, upon the Department’s request, Broadband Program applicants must provide geospatial data, including data that is reported to the Federal Communications Commission, and other data as necessary from the Internet service providers and entities with broadband infrastructure in the state for the purpose of complying with federal funding requirements and for determining eligibility for grants and loans issued by the Department. The collected data is subject to the following:

(a) The collected information must be in a form that can be viewed, edited, and mapped by the Department.

(b) The Department may require the data be submitted in a specific, templated format.

(c) The Department may collect proprietary information subject to a nondisclosure agreement. Proprietary information subject to a nondisclosure agreement that is collected by the office under this section (2) is exempt from public disclosure under ORS 192.355.

(3) Notice of Pending Applications and Notice of Awards. For Broadband Service Infrastructure Programs, the Department may use its Map Service described in OAR 123-047-0087 and the Department’s website to:

(a) Publish notice of award recipients for projects providing for the development of Broadband Service Infrastructure.

(b) Provide public notice of pending applications.

(4) Applications Generally are Public Records. Subject to Oregon Public Records Law exceptions, the Department may publish Broadband Program applications in part or in whole on the Oregon Broadband Office webpage.

(5) Public Comment. The Department will solicit public comments based on the contents of pending Broadband Service Infrastructure Programs applications.

(a) Public comments received in response to an application may be considered as part of the evaluation of the application at the Department’s sole discretion.

(b) Public comments opposing an application are separate and distinct from formal challenges, which are addressed in section (6) of this rule.

(6) Challenge Process. Except as provided in Section (6)(a) of this Rule below, the Department will establish a challenge process for each Broadband Service Infrastructure Program. The process, including the period of time for challenging applications submitted for a Broadband Service Infrastructure Program, will be specified in the funding notice or Program Handbook.

(a) If a Broadband Service Infrastructure Program is funded with federal funds and such federal funds or associated federal program provides for a challenge process, the Department may elect not to establish an independent challenge process, instead relying solely on the applicable federal challenge process to provide a process for challenging an application.

(b) Applications for loans or grants funded from the federal Coronavirus Capital Projects Fund (42 U.S.C. 804) that are for broadband service infrastructure projects will be subject to challenge by a broadband service provider as provided by Section 1a(1)(c), chapter 338, Oregon Laws 2023.

(c) The Department elects not to establish an independent challenge process, but instead to rely on the available federal challenge process for applications for loans or grants for broadband service infrastructure projects funded from the federal Broadband Equity, Access, and Deployment (BEAD) Program established under 47 U.S.C. 1702.

(d) Challenge submissions of Broadband Service Infrastructure Program applications based on requisite broadband service speeds may only be made by broadband service providers that would be directly impacted by the project described in an application for the development of broadband service infrastructure. A successful challenge requires an entity making a formal challenge submission to effectively demonstrate at least one of the following to the Department’s satisfaction:

(A) The broadband service provider provides broadband service at the requisite speeds to the location; or

(B) The broadband service provider has an enforceable commitment to provide broadband service at the requisite speeds to the location; and the commitment to provide broadband services at the requisite speeds to the location is by a date that is earlier than the date the proposed broadband service infrastructure will begin to provide broadband services, as described in the application.

(e) Any individual or entity may make a challenge submission where:

(A) A challenge involves a credible allegation of a material misrepresentation made within a submitted application; or

(B) Another reason(s) is authorized and detailed in an accompanying funding notice or Program Handbook.

(f) The burden for proving a challenge claim is on the challenger individual or entity, whose responsibility it will be to provide enough evidence to fully support their claim to the Department’s satisfaction.

(g) Unless specified otherwise in the funding notice or Program Handbook, challenges submitted in response to an application will remain attached to and be considered alongside an application for as long as the application remains in consideration for funding.

(h) The Department may reject or otherwise dismiss a challenge. The Department will notify a challenger in the event their submission is rejected or otherwise dismissed.

(i) If a challenger proves a challenge claim to the Department’s satisfaction, including but not limited to effectively demonstrating service availability at or above the speeds required for eligibility, the Department will uphold the challenge and reject the application or request the applicant modify the application.

(j) Abuse and disqualification. The Department may dismiss a challenge if the Department determines, in its sole discretion, that the individual or entity’s challenge is an abuse of the challenge process. Reasons for such a determination may include but are not limited to the following:

(A) History of meritless challenges;

(B) Intentional repeated challenges of a single project;

(D) Harassment of Department staff, applicants, or subject community members.

(k) For entities and individuals found to have abused the challenge process, the Department may deny their eligibility to participate in, apply for, challenge, or appeal any current or future Broadband Program.

(l) Dismissed challenges will not be considered in the scoring or evaluation of applications.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), Oregon Laws 2021, chapter 524, 2022 Oregon Laws, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), Oregon Laws 2021, chapter 524, 2022 Oregon Laws, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0045 Eligible Applicants, Eligible Projects and Eligible Activities

(1) Unless specified otherwise in Oregon statute or rule, eligible applicants for Broadband Programs include the following: municipalities as defined in ORS 285B.410(9), federally recognized Indian tribes in Oregon listed under ORS 285C.306(1), intergovernmental organizations formed under ORS Chapter 190, and nonprofit organizations as defined by ORS 65.001(33). For profit entities may also be eligible applicants for a Broadband Program if specifically authorized by applicable state statute or rule.

(2) The Department reserves the right to withhold or revoke eligibility from an applicant at its sole discretion for reasons including:

(a) nonperformance under a prior contract with the Department or other State entity;

(b) delinquency of tax or fees owed to the State or to a local government;

(d) pending legal action involving the applicant (if the outcome would impact the applicant’s ability to perform under a contract or agreement);

(e) abuse of grant or loan process (such as submitting meritless challenges against other applicants);

(f) willful misrepresentations made within an application submitted to the Department; or correspondence with; or made publicly about the Department; or

(g) lacking the legal authority or ability to execute a financing contract with the Department.

(3) Eligible projects for Broadband Program financial assistance shall be defined in the respective program’s funding notice, rules, or Program Handbook. Eligible projects may be limited to those meeting applicable broadband services speed criteria, including meeting any applicable underserved location or unserved location criteria.

(4) Eligible uses/activities for Broadband Program funds shall be defined in the applicable funding notice, financing contract, rules or Program Handbook.

(5) Ineligible Uses/Activities. Ineligible uses/activities will be defined in the applicable funding notice, financing contract, rules or Program Handbook. In addition, unless otherwise authorized, Broadband Program financial assistance may not be used to:

(a) Pay for materials bought to resell to a broadband project at a profit.

(b) Pay for costs incurred prior to a Broadband Program grant or loan financial assistance award date.

price, the grant or loan funds must be pro-rated for actual use only.

(d) Pay for personal expenses not directly related to the broadband project construction.

(e) Fund indirect or operational costs (i.e., anything that is not a direct project cost).

(f) Pay for expenses related to the provision of over-the-top services such as telephone or video services which are not necessary for the delivery of broadband service (except for customer-premise battery backup devices).

(g) Pay for fundraising activities.

(h) Pay for political endorsements, donations, or advertisements.

(i) Pay for computers or office equipment.

(j) Pay for the purchase or lease of a “vehicle” as defined in ORS 801.590.

(k) Pay for permitting, planning, or development of broadband infrastructure outside of State boundaries not directly necessary to serve in-State locations listed in an awarded proposal.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0047 Evaluation Criteria

(1) Evaluation criteria for Broadband Program applications and for awarding financial assistance shall include:

(a) Whether the applicant has capacity or will have capacity to deliver the proposed project;

(b) Whether the submitted application is complete, clearly defines the proposed project, and effectively demonstrates a need for financial assistance; and

(c) Other criteria provided for in the funding notice, rule, and Handbook as applicable for the respective Broadband Program.

(2) Evaluation criteria for the Broadband Service Infrastructure Programs shall also include:

(a) Whether the proposed project will directly address factors contributing to the Digital Divide, including lack of access to broadband, lack of affordability of broadband service, and adoption of broadband by end-users; and

(b) The quantity of eligible locations to be served by a proposed project and their service levels at the time of the proposal’s submission.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0060 Financial Assistance Disbursements

(1) Unless stated otherwise in the funding notice, financing contract, or Program Handbook, financial assistance issued through a Broadband Program will be disbursed to an award recipient on an expense reimbursement or costs-incurred basis. The recipient must submit a disbursement request on a Department-provided or Department-approved disbursement request form for the actual, documented expenses incurred while conducting eligible activities of the Broadband Program.

(2) Notwithstanding section (1), the Department may, in its discretion, provide advance payment of funds upon a recipient’s request. Recipients seeking an advance payment must specifically indicate which portions of the proposed project justify payment in advance.

(3) All financial assistance disbursements will be subject to the Department’s determination, in its sole discretion, that the recipient meets the conditions precedent to disbursement provided for in the financing contract, including requiring no events of default at the time of disbursement. In addition, the Department may reject any application upon finding that to accept the application may impair the integrity of the solicitation process or that rejecting the application is in the best interest of the Department.

(4) The Department reserves the right to amend or cancel a solicitation for financial assistance through a Broadband Program, without liability if it is in the best interests of the Department.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0080 Records and Data Confidentiality

(1) Applications and financing contracts will be public records that are subject to disclosure except for material that qualifies under a public records exemption or is otherwise subject to confidentiality protections provided by law. The Department will redact material that is exempt from disclosure under the Oregon Public Records Law.

(2) When submitting materials to the Department, it is the applicant’s responsibility to mark material believed exempt from disclosure under Oregon Public Records Law. To designate a portion of an application as exempt from disclosure under the Oregon Public Records Law, the applicant shall: (a) Clearly identify in the body of the application or financing contract only the limited material that is believed to be a trade secret or would otherwise be exempt under public records law; (b) Identity the public records law exemption(s) that is believed to apply; and (c) Provide a justification for how each portion designated as exempt meets the criteria under the public records law.

(3) The Department shall determine whether any information is exempt from disclosure.

(4) Applicants are advised to consult with legal counsel regarding disclosure issues. Applicants may wish to limit the amount of trade secret information submitted, providing only what is necessary to submit a complete and competitive application.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0085 Reporting Requirements

(1) Every recipient of financial assistance from a Broadband Program must comply with reporting requirements provided in the financing contract and these rules.

(2) Broadband Program financial assistance recipients shall report the following at the frequency provided in the financing contract:

(a) Status regarding the completion of the project;

(b) Reporting, tracking, and documentation of incurred costs and expenses. Recipients receiving financial assistance on a reimbursement basis shall submit individual receipts and documentation when requesting reimbursement from the Department. Recipients receiving financial assistance in a lump sum or advance payment shall submit expenditure reports with individual receipts and documentation for Department review.

(c) If applicable, the contents, progress, and outcomes of any requests for proposals published by a recipient in search of professional assistance in performing tasks necessary to satisfy the terms of a financing contract.

(d) Upon request, recipients shall produce or make available for inspection by the Department, any other reports or records necessary for the Department to ensure responsible use of funds.

(3) Broadband Service Infrastructure Program financial assistance recipients shall report the geographic area and the locations that are proposed to be served by the project as a condition to disbursement of financial assistance. Broadband Service Infrastructure Program financial assistance recipients shall report the geographic area and the locations served at the completion of the project and at other times as may be required by the financing contract.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), 2022 Oregon Laws, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), 2022 Oregon Laws, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0087 Registry of Telecommunication Providers and Statewide Broadband Map

(1) The Department will develop and maintain a registry of telecommunications providers (as that term is defined in ORS 184.911) in the state that includes broadband service providers. Any telecommunications provider wanting to receive notifications of Broadband Service Infrastructure Program applications must register with the Department.

(2) The Department will publish and maintain a Statewide Broadband Map (“Map”). The Map will be used to identify locations that would be benefited by a Broadband Service Infrastructure Program project when required for compliance.

(3) The Map may be used to illustrate broadband speed availability and depict areas eligible for Broadband Service Infrastructure Program financial assistance.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), Oregon Laws 2021, chapter 524, Oregon Laws 2022, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), Oregon Laws 2021, chapter 524, Oregon Laws 2022, chapter 60 & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0090 Broadband Technical Assistance Program (BTAP)—Purposes and Objectives

The Broadband Technical Assistance Program will provide Technical Assistance grants and loans utilizing Universal Service Fee funds transferred by the Public Utility Commission to the Broadband Fund. The objective of the program is to support and promote local and regional broadband planning efforts as they develop broadband investment and deployment strategies for unserved and underserved areas.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603), Oregon Laws 2023, chapter 338 (HB 3201) & ORS 184.925
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0095 Broadband Technical Assistance Program (BTAP)—Handbook

The Broadband Technical Assistance Program Handbook, with the requirements and standards therein, is incorporated into and adopted as part of this division of administrative rules by reference and has application to the solicitation, review of applications, award and documentation of Broadband Technical Assistance Program grants and loans once the handbook is completed and effective as a rule. The handbook may be accessed online on the Department’s website when the handbook is effective.

[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, ORS 184.925, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 7-2024, amend filed 04/26/2024, effective 04/26/2024
OBDD 31-2023, temporary amend filed 11/20/2023, effective 11/20/2023 through 05/17/2024
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0100 Broadband Equity, Access, and Deployment (BEAD) Program—Purposes and Objectives

The federal Broadband Equity, Access, and Deployment (BEAD) Program, established under 47 U.S.C. 1702, will provide funding to Oregon. The Department will use a portion of the funds to establish a state broadband deployment program that provides grants towards the costs of physical broadband infrastructure.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0105 Broadband Equity, Access, and Deployment (BEAD) Program—Handbook

(1) The Department will not publish and adopt as a rule a separate Program Handbook for the BEAD Program.

(2) Applicants for the Broadband Equity, Access, and Deployment (BEAD) Program shall comply with the following requirements (collectively, “BEAD Program Requirements”):

(a) 47 U.S.C. 1702 (2021);

(b) the Broadband Equity, Access, and Deployment Program Notice of Funding Opportunity (NOFO) requirements issued by the National Telecommunications and Information Administration (“NTIA”) in May 2022;

(d) the State of Oregon’s BEAD Program Initial Proposal (Volume 2) as approved by the NTIA (required by the NOFO); and

(e) the State of Oregon’s BEAD Program Final Proposal when approved by NTIA (required by the NOFO).

(3) The BEAD Program Requirements and standards therein, are incorporated into and adopted as part of this division of administrative rules by reference and have application to the solicitation, review of applications, award and documentation of BEAD Program grants and loans. The BEAD Program Requirements may be accessed online on the Department’s website.

(4) In addition to the eligible applicants provided for in OAR 123-047-0045 (1), eligible applicants for the BEAD Program include those authorized by 47 U.S.C. 1702, including cooperatives, public-private partnerships, private companies, public or private utilities, local governments (including any unit, subdivision, authority, or consortium of local governments) and public utility districts.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, ORS 184.925, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 19-2024, amend filed 07/30/2024, effective 07/30/2024
OBDD 6-2024, temporary amend filed 04/10/2024, effective 04/11/2024 through 10/07/2024
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0110 ARPA Capital Projects Fund Broadband Deployment Program—Purposes and Objectives

The Coronavirus Capital Projects Fund (42 U.S.C. 804) will be used to fund a broadband deployment program that provides grants towards the costs of physical broadband infrastructure (“ARPA Capital Projects Fund Broadband Deployment Program”).

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, ORS 184.925, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 3-2026, temporary amend filed 02/04/2026, effective 02/04/2026 through 07/31/2026
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Or. Admin. R. 123-047-0115 ARPA Capital Projects Fund Broadband Deployment Program – Handbook

The ARPA Capital Projects Fund Broadband Deployment Program Handbook, dated April 2025, with the requirements and standards therein, is incorporated into and adopted as part of this division of administrative rules by reference and applies to the solicitation, review of applications, award and documentation of ARPA Capital Projects Fund Broadband Deployment Program grants. The handbook may be accessed online on the Department’s website when the handbook is effective.

[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.166, ORS 184.925, Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
Statutes/Other Implemented: Oregon Laws 2020, chapter 17, Section 5(2) (First Special Session) (SB 1603) & Oregon Laws 2023, chapter 338 (HB 3201)
OBDD 3-2025, amend filed 04/30/2025, effective 04/30/2025
OBDD 52-2024, temporary amend filed 11/27/2024, effective 11/27/2024 through 05/23/2025
OBDD 19-2024, amend filed 07/30/2024, effective 07/30/2024
OBDD 5-2024, temporary amend filed 03/15/2024, effective 03/15/2024 through 09/10/2024
OBDD 1-2024, amend filed 03/04/2024, effective 03/04/2024
OBDD 30-2023, adopt filed 11/14/2023, effective 11/14/2023

Division 49 SAFE DRINKING WATER REVOLVING LOAN FUND PROGRAM

Or. Admin. R. 123-049-0005 Purpose, Scope and Incorporated Documents

(1) This division of administrative rules implements a federally funded state revolving fund to provide financing to community and nonprofit non-community drinking water systems for planning, design, construction or improvement of drinking water facilities or systems needed to maintain or achieve compliance with drinking water standards and to further public health protection goals of the federal Safe Drinking Water Act Amendments of 1996 P.L. 104-182 and this state's Drinking Water Quality Act.

(2) In accordance with ORS 285A.213, this division of administrative rules governs the administration of the moneys awarded through this Safe Drinking Water Revolving Loan Fund by the Oregon Business Development Department through its Infrastructure Finance Authority in cooperation with the State of Oregon Health Authority through its Drinking Water Services, but not activities of Oregon Health Authority itself.

(3) The most current version adopted by the Authority of the "SAFE DRINKING WATER IN OREGON: Program Guidelines and Applicant's Handbook for the Federally Funded Safe Drinking Water Revolving Loan Fund and Drinking Water Protection Fund" including but not limited to its appendices, is:

(a) The principal source of information on this program, as prepared by the Authority;

(b) Available by contacting any of the Authority’s regionally assigned staff; and

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 1-2001, f. 1-11-01, cert. ef. 1-12-01
EDD 11-2000(Temp), f. 7-20-00, cert. ef. 7-20-00 thru 1-16-01
EDD 6-1999, f. & cert. ef. 8-26-99

Or. Admin. R. 123-049-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context clearly indicates otherwise:

(1) "Act" means the Safe Drinking Water Act at 42 U.S.C. 300f et seq., including amendments of 1996 (Public Law 104-182), and any subsequent amendments

(2) "Applicant" means a community or nonprofit non-community water system that is applying for a loan from the Fund.

(3) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(4) "Community water system" means a public water system, other than one owned by an agency of the federal government, that:

(a) Has 15 or more service connections used by year-round residents; or

(b) Regularly serves 25 or more year-round residents.

(5) "Contract" means a legally binding agreement between the department and recipient that sets out the terms and conditions for award of project funds.

(6) "Fund" means the Safe Drinking Water Revolving Loan Fund and the Drinking Water Protection Fund, which are the financing programs managed by the Authority under this division of administrative rules to pay for infrastructure improvements to eligible public water systems, and which includes moneys originating directly from federal capitalization grants (apart from set-asides), this state's match of such grants, program loan repayments, interest earnings and any additional funds provided by this state.

(7) "Intended Use Plan" the description of how the state intends to use moneys awarded and loaned from the fund to meet the objectives of the Act, as annually prepared by Oregon Health Authority pursuant to USEPA guidelines.

(8) "Nonprofit non-community water system" means a public water system that:

(a) Is not a community water system;

(b) Regularly serves at least 25 people, even if they are not year-around residents; and

(9) "Project" means facility design construction activities or related/preceding tasks identified in the contract and loan agreement for which the recipient may expend, obligate or commit funds to address a drinking water problem or a documented health hazard.

(10) "Project priority list" means the comprehensive priority list of potential, eligible activities, as developed under the Intended Use Plan in response to letters of interest from community and nonprofit non-community water systems.

(11) A "public water system" means a system or infrastructure for the provision to the public of water for human consumption through pipe or other constructed conveyances, regardless of ownership, including but not limited to facilities for source of supply, filtration, treatment, storage, transmission or metering of that water.

(12) "Recipient" means a community or nonprofit non-community water system that has been awarded financing from the fund for a project.

(13) "USEPA" means the Environmental Protection Agency of the United States federal government.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 6-1999, f. & cert. ef. 8-26-99

Or. Admin. R. 123-049-0020 Eligible Applicants and Activities

(1) All community water systems and nonprofit non-community water systems are eligible to apply for financing except those determined to be ineligible by the department because of prior nonperformance.

(2) Eligible and ineligible activities are defined in the Act and in USEPA’s Drinking Water State Revolving Fund Program Guidelines, EPA 816-R-97-005 (February 1997), as well as subsequent revisions or editions of such guidelines.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 6-1999, f. & cert. ef. 8-26-99

Or. Admin. R. 123-049-0025 Funding Award Information

(1) The Authority may award financing in a manner that maximizes the use of available resources and maintains the desired credit standards of the Fund. The Authority shall determine the amount, type, interest rate and terms of any financing awarded. It may offer an alternative mix or lower amount of assistance than requested. The amount of the award may be the minimum amount that the Authority determines is necessary to enable the project to proceed, and the Authority may investigate and recommend other sources of funds for all or part of a proposed project. Projects that the Authority determines are not financially feasible will not be funded.

(2) The term of a loan is limited to the usable life of the contracted project, or 30 years from the year of project completion, whichever is less.

(3) The term of a loan for a planning or design only project shall not exceed 10 years.

(4) For municipal entities a loan must be secured by a full faith and credit obligation that is payable from any taxes which the municipality may levy within the limitations of Article XI of the Oregon Constitution and all legally available revenues and other funds of the municipality. A pledge of specific revenues of the municipality may be required by the Authority to be pledged in addition to the foregoing.

(5) For privately owned water system a loan must be secured at minimum by a pledge of a specifically identified revenue source such as the pledge of accounts receivable and proceeds therefrom. Additional loan security may be required based on the Authority’s assessment of borrower risk.

(6) The maximum amount for a loan for a project will be determined by the Authority on the basis of financial analysis of the borrower’s capacity for repaying the debt, the availability of moneys in the fund and prudent fund management. The Authority may limit the maximum amount an entity can borrow based on fund availability, program demand and Oregon Health Authority prioritization of projects.

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS285A.213
OBDD 8-2023, adopt filed 06/05/2023, effective 06/05/2023

Or. Admin. R. 123-049-0026 Application Review and Approval

(1) After Oregon Health Authority eligibility determination and rating and ranking of a preliminary letter of interest form, an eligible water system may submit a funding application upon invitation from the Authority. The water system shall comply with the Authority’s procedures for submitting applications.

(2) The application shall be in the form provided by the Authority and shall contain or be accompanied by such information and documentation as the Authority may require. The Authority will process only completed applications.

(3) For a project that is part of a water system that is, or will be, functionally connected to another water system, a cooperation agreement that describes the duties and obligation of each entity is required. The fully executed agreement must be provided before funds for construction activities may be disbursed.

(4) In order to approve a funding application, the Authority must make the following determinations:

(a) Project feasibility as demonstrated by certification from a professional engineer registered in the State of Oregon in an engineering report, such as a Master Plan, that the proposed project is feasible or other feasibility documentation approved by the Authority.

(b) The loan is secured by the pledge of utility revenues or other revenues or payments from owners of specially benefitted properties, and these revenues or payments are sufficient, when considered with other security, to assure repayment of the loan and the Applicant has certified to the Authority that there will be adequate funds available to repay the loans made to the Applicant from the Fund.

(d) The Applicant is willing and able to enter into a contract with the Authority.

(e) The project is consistent with the requirements governing assistance from the Fund. If the Authority determines that the water system or the proposed project does not meet the requirements of OAR 123-049-0026, the Authority may reject an application or require further documentation from the Applicant.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285.213(4)
Statutes/Other Implemented: ORS 285.213
OBDD 8-2023, adopt filed 06/05/2023, effective 06/05/2023

Or. Admin. R. 123-049-0027 Contract Requirements and Disbursement of Funds

(1) The Authority shall disburse monies from the Fund only after entering into a binding contract with the Recipient.

(2) The contract shall be in a form provided by the Authority.

(3) Other funds that may be needed to complete the project must be available or the Recipient must have a binding commitment for such funds at the time the contract is executed. If a portion of the other funds needed to complete the project is committed but not yet available at the time an award is made or the contract executed, the contract shall require that no disbursement of funds for construction activities may occur until the project is fully funded.

(4) Contracts for privately owned water systems receiving subsidy award shall be conditioned to adhere to OAR 123-049-0050.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285.213(4)
Statutes/Other Implemented: ORS285A.213
OBDD 8-2023, adopt filed 06/05/2023, effective 06/05/2023

Or. Admin. R. 123-049-0030 Program Information

(1) The Authority shall prepare program guidelines, application forms and other supplementary program information to help Applicants seek financing and prepare financing applications for the Fund.

(2) Program guidelines as prepared under section (1) of this rule shall include an explanation of project eligibility, the project priority list, the Intended Use Plan, disadvantaged communities, types of financial assistance, loan rates and terms, borrowing limits, public notification process, contract administration, federal crosscutting requirements and environmental review process.

(3) In addition to this division of administrative rules, the Authority shall administer the Fund in compliance with the requirements of the Act, as amended, and the Act's applicable rules, guidelines and requirements from USEPA.

(4) For purposes of land use coordination, any project activity paid for with financing from the Fund shall comply with the applicable requirements of division 8 of this chapter of administrative rules and OAR chapter 660.

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 6-1999, f. & cert. ef. 8-26-99

Or. Admin. R. 123-049-0035 Loan Fee

(1) The Authority may charge a loan fee on all funding awards, unless eligible for any exceptions established in this rule. The loan fee amount will be set by the IFA Board and may be periodically revised by that Board.

(2) The fee may be included as part of the loan principal. A funding recipient shall pay the loan fee as part of the first disbursement of project funds.

(3) Fee revenue shall be used for eligible Fund administrative costs incurred by the Authority.

(4) A fee may only be charged to awards for public water systems determined to be non-disadvantaged as a part of Oregon Health Authority rating and ranking of preliminary letter of interest.

(5) The loan interest rate plus assessed borrowing fees shall not exceed current market rate as determined by the Authority.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.200 & ORS.285A.213
Statutes/Other Implemented: ORS 285A.200 & ORS.285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 6-2021, adopt filed 04/13/2021, effective 04/13/2021
OBDD 3-2021, temporary adopt filed 01/28/2021, effective 01/28/2021 through 07/26/2021

Or. Admin. R. 123-049-0040 Program Rights and Remedies

(1) The Department may exercise certain rights and remedies in the event the recipient fails to comply with contract provisions and the recipient fails to correct the deficiencies within a reasonable time after the recipient is notified of the deficiencies. The circumstances that may warrant the department exercise of rights or remedies include, but are not limited to one or more of the following:

(a) None of the project activities have begun within six months after award;

(b) Any third party agreement relating to the project is not legally binding within six months of the award;

(d) There is a significant deviation from the contract;

(e) The department finds that significant corrective actions are necessary to protect the integrity of the project funds, and those corrective actions are not, or will not, be made within a reasonable time; or

(f) A recipient defaults on loan payments, which may otherwise be made from any source of revenue at the recipient's disposal, including but not limited to General Fund revenue.

(2) One or more of the following rights and remedies may be exercised by the Department if the recipient fails to comply with contract provisions and the recipient fails to correct the deficiencies within a reasonable time after recipient is notified of the deficiencies:

(a) Bar a recipient from applying for future department or Authority assistance;

(b) Revoke an existing Department or Authority award;

(d) Require immediate return of unexpended Department or Authority funds;

(e) Require repayment of expended Department or Authority funds;

(f) Withhold other state funds otherwise due to the recipient, such as state-shared revenues; or

(g) Other remedies that may be incorporated into the contract.

(3) The remedies set forth in this rule are cumulative, are not exclusive, and are in addition to any other rights and remedies provided by law or under the contract.

(4) The recipient shall be responsible for ensuring that any subcontractor complies with the applicable terms and conditions of the contract. Nothing in this rule shall restrict the Department’s right to enforce independently the terms of any contract or to recover any sums that may become due as the result of a breach of such contract.

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 6-1999, f. & cert. ef. 8-26-99

Or. Admin. R. 123-049-0050 Private Ownership and Regulation of Subsidies for Public Benefit

(1) For a privately owned water system awarded subsidy by the Fund, the amount of subsidy shall not be treated as equity, but rather in all cases as a contingent liability on the balance sheet of the public water system receiving the financing and on the balance sheet of any entity that acquires that system or the assets financed by the Fund.

(2) If a privately owned water system is sold that was awarded subsidy by the Fund, the value of the subsidy shall be effectively excluded from the purchase price, consistent with section (1) of this rule, such that the benefit of the principal forgiveness continues to accrue to the ratepayers or users of the system rather than to the seller. (This section also applies to the sale or lease of system assets financed by the loan, and it pertains but is not limited to the privatization of a publicly owned system)

(3) If section (1) or (2) of this rule is violated, then the water system shall repay the full amount of the subsidy into the Fund. The Authority shall determine the schedule of such repayment, as it deems appropriate under the circumstances.

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 2-2009(Temp), f. & cert. ef. 3-6-09 thru 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04
EDD 1-2001, f. 1-11-01, cert. ef. 1-12-01
EDD 11-2000(Temp), f. 7-20-00, cert. ef. 7-20-00 thru 1-16-01

Or. Admin. R. 123-049-0060 Drinking Water Protection Fund

(1) For purposes of implementing section 1452(k)(1) of the Act, the Authority shall administer loans and grants to public water systems for protecting surface and underground sources of drinking water, in order to solve or prevent health problems before the water is collected or treated by the system.

(2) The moneys for these loans and grants are derived from the "local assistance" set-aside of the federal capitalization grant, such that unused amounts will be transferred to the Fund, and repayments shall be either added to the Fund or placed in a dedicated account for further lending under this rule.

(3) The loans under this rule are distinct from the Fund. Relevant provisions of this division of administrative rules, however, shall apply to the administration of such loans and grants.

(4) For purposes of this rule, administration includes underwriting assessments, loan awards, grant awards contract execution, disbursements, loan repayments and so forth.

(5) Oregon Health Authority through its Drinking Water Services and the Oregon Department of Environmental Quality shall handle determinations of eligibility, prioritization of loan grant recipients and related duties.

(6) More specific guidelines for the loans grant under this rule are available and included in the document incorporated by reference in OAR 123-049-0005(3).

History

Statutory/Other Authority: ORS 285A.075 & 285A.213(4)
Statutes/Other Implemented: ORS 285A.213
OBDD 8-2023, amend filed 06/05/2023, effective 06/05/2023
OBDD 4-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 7-2009, f. 8-31-09 cert. ef. 9-1-09
EDD 28-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2004, f. & cert. ef. 2-3-04

Division 51 OREGON SEISMIC REHABILITATION GRANTS PROGRAM

Or. Admin. R. 123-051-0100 Purpose

(1) The Infrastructure Finance Authority, pursuant to Oregon Revised Statutes ORS 401.910, shall develop and administer grant programs for the seismic rehabilitation of critical public buildings.

(2) The funds for the seismic rehabilitation of critical public buildings under the grant program are provided from the issuance of bonds pursuant to the authority provided in Articles XI-M and XI-N of the Oregon Constitution.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 286A.760 – 286A.772, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.098, 286A.760 – 286A.772, 401.910 & 2013 OL Ch. 782
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0200 Definitions

(1) “Acute inpatient care facility” means a licensed hospital with an organized medical staff, with permanent facilities that include inpatient beds, with comprehensive medical services, including physician services and continuous nursing services under the supervision of registered nurses, to provide diagnosis and medical or surgical treatment primarily for, but not limited to acutely ill patients and accident victims. “Acute inpatient care facility” includes the Oregon Health and Science University.

(2) “Applicant” means a school district, community college, education service district, police, sheriff, fire, hospital which is applying for a grant from the Seismic Rehabilitation program.

(3) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(4) “Collapse Prevention” means a building at this performance level is capable of maintaining gravity loads though structural damage is severe and risk of falling hazard is high as set forth in the American Society of Civil Engineers Standard for Seismic Rehabilitation of Existing Buildings newest edition.

(5) “Critical Public Buildings” includes hospital buildings with acute inpatient care facilities, fire stations, police stations, sheriffs’ offices, other facilities used by state, county, district, or municipal law enforcement agencies and buildings with a capacity of 250 or more persons that are routinely used for student activities by kindergarten through grade 12 public schools, community colleges and education service districts.

(6) “Distressed or Impoverished” means all Oregon cities and counties designated by Oregon Business Development Department as distressed or impoverished by established methodology.

(7) “Education Service District (ESD)” means a district created under ORS 334.010 that provides regional educational services to component school districts.

(8) “Grant Program” means The Seismic Rehabilitation Grant Program (SRGP).

(9) “Grant Selection Committee” means the committee that is charged with evaluating grant applications for the purpose of determining which projects receive funding. The grant selection committee membership shall include representatives of Oregon Department of Education, The Department of Human Services, The Office of Emergency Management/Oregon Military Department, The State Department of Geology and Mineral Industries, Oregon Seismic Safety Policy Advisory Commission, The Oregon Department of Administrative Services, The Oregon Fire Chiefs’ Association, The Oregon Association of Chiefs of Police, Community Colleges and Workforce Development, The Oregon Association of Hospitals and Health Systems, The Confederation of Oregon School Administrators and others who possess expertise in construction, construction grants and structural design as determined by the Authority.

(10) “Grantee” means applicant awarded grant funds for seismic rehabilitation project.

(11) “Holistic Project” means a project emphasizing the whole building instead of the separation of its parts.

(12) “Immediate Occupancy” means a building at this performance level is expected of being sufficiently functional for occupancy as set forth in the American Society of Civil Engineers Standard for Seismic Rehabilitation of Existing Buildings newest edition.

(13) “Life Safety” means a building at this performance level is expected to present low risk of life threatening injury to building inhabitants as set forth in the American Society of Civil Engineers Standard for Seismic Evaluation of Existing Buildings newest edition.

(14) “Match” is any contribution to a project that is non-seismic grant funds. Match may include:

(a) Cash on hand or cash that is pledged to be on hand prior to commencement of the project; and,

(b) Secured funding commitments from other sources.

(15) “Project” means seismic rehabilitation activity (or activities) to be performed on a building that is eligible for assistance from the Seismic Rehabilitation Grant Program.

(16) “Seismic Rehabilitation” means construction of structural improvements to a building that results in the increased capability of the building to resist earthquake forces and that is based on standards adopted by the State of Oregon or by local governments.

(17) “Structural” means components of a building that support or resist loads. Parts of a building that bear weight.

(18) “Tsunami Inundation Zone” means for purposes of the SRGP, the area depicted as the tsunami inundation zone in Oregon Department of Geology and Mineral Industries Open-File Reports O-95-09 through O-95-38, O-95-43 through O-95-66 and O-97-31 through O-97-32.

(19) “Useful Life” means the length of time that the building or structure is expected to be used, or 30 years, whichever is greater.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0300 Eligible Applicants

The following are eligible to apply for a Seismic Rehabilitation Grant, except those determined to be ineligible by the Authority because of nonperformance under a prior Seismic Rehabilitation Grant contract:

(1) All hospital buildings with acute inpatient care facilities, fire stations, police stations, sheriffs’ offices, other facilities used by state, county, district or municipal law enforcement agencies.

(2) Kindergarten through grade 12 public schools, community colleges and education service district buildings with a capacity of 250 or more persons that are routinely used for student activities and are owned by a school district, an education service district, a community college district or a community college service district.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0400 Program Information

(1) The Authority shall prepare a Grant Application Package. The application package may contain a guidance document, application forms, and other supplementary information that may help eligible applicants prepare grant applications.

(2) The guidance document will include a description of eligibility criteria, and ranking factors used to evaluate and select applications for funding.

(3) The Grant Application Package on file with the Authority is incorporated as part of these rules by reference.

(4) The Authority will provide to Seismic Rehabilitation grantee a Grant Contract which specifies legal requirements for grant management, reporting, and record keeping, and the Authority's monitoring and grant closeout procedures.

(5) The Authority shall administer Seismic Rehabilitation Grants in compliance with the requirements of applicable statutes, rules, and the Grant Guidance Document.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0500 Program Sanctions

The grantee shall be responsible for taking all actions necessary to enforce the terms of the grant contract against any private or public participant who fails to comply with applicable provisions of the grant contract, and to recover on behalf of the state any liabilities that may arise as the result of the breach of the grant contract by any participant. Nothing in this paragraph shall restrict the state's rights to enforce independently the terms of any grant contract or to recover any sums that may become due as the result of a breach of such a contract.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0600 Project Eligible Activities

Projects must meet the following criteria to be eligible for this program:

(1) Education building gymnasiums, cafeterias and multipurpose rooms that are feasible to be used as emergency shelters in disasters must be rehabilitated to meet the Immediate Occupancy seismic safety performance level as defined in OAR 123-051-0200(12)

(a) Applicants may request a waiver for education building gymnasiums, cafeterias and multipurpose rooms that will not be used as emergency shelters in disasters, upon showing that there are other buildings in the community that may be used as emergency shelters in disasters instead of the education building. Any projects approved under this subsection must be rehabilitated to meet the life safety seismic performance level as defined in OAR 123-051-0200(13).

(b) Applicants may request approval for other types of education building rooms that are feasible to be used as emergency shelters upon showing that there are no gymnasiums, cafeterias and multipurpose rooms that are feasible to be used as emergency shelters. Any approved projects under this subsection must be rehabilitated to meet the immediate occupancy seismic safety performance level defined in OAR 123-051-0200(12).

(2) Other education buildings that will not be used as emergency shelters in disasters, must be rehabilitated to meet the life safety seismic safety performance level defined in OAR 123-051-0200(13).

(3) Emergency services building rehabilitation to immediate occupancy seismic safety performance level as defined in OAR 123-051-0200(12).

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0700 Project Ineligible Activities

Project ineligible activities include, but are not limited to:

(1) The demolition and rebuild of an existing critical public building.

(2) Partial rehabilitation of a building that does not holistically address all known seismic deficiencies, as defined in OAR 123-051-0200(11).

(3) Reimbursement for already budgeted staff and routine or ongoing expenses of the recipient.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 12-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0750 Special Conditions

(1) If the building is located in an identified tsunami inundation zone the applicant shall consult with the State Department of Geology and Mineral Industries for assistance in determining the impact of possible tsunamis on the proposed project and for assistance in preparing methods to mitigate risk at the site of a potential tsunami. Consultation shall take place prior to submittal of the grant application. Proof of the consultation must be included with the application packet submitted for the project.

(2) If the building is located in the 100 year flood zone, additional engineering review may be required.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & OL Ch. 782 2013
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 12-2019, adopt filed 09/04/2019, effective 09/04/2019

Or. Admin. R. 123-051-0800 Application Submittal, Review and Approval

(1) The Authority shall announce deadlines for submitting applications, how to obtain an application form, and required supplemental documents.

(2) An eligible critical public building may submit an application after consulting with the Authority on a preliminary determination of eligibility and otherwise follow the Authority’s procedures for submitting applications. The application must be in the form provided by the Authority and must contain or be accompanied by such information as the Authority may require. The Authority will process only completed applications.

(3) Upon receipt of a completed application, the Authority will evaluate the application using ranking factors and point values and will provide recommendations to the Grant Selection Committee to determine the project’s prioritization ranking during a public meeting.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 12-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-0900 Project Administration

(1) The Authority and the Applicant must execute a grant contract prior to disbursal of grant funds.

(2) Documentation of project costs incurred by entity must be submitted to the Authority prior to disbursal of funds.

(3) Disbursal of grant funds to entity will be made on the schedule determined by the Authority.

(4) Prior to final disbursement, the Authority will review and evaluate all documents produced as a result of the project, and determine how closely the project delivered the outcome anticipated in the application.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-1000 Grant Awards and Match

(1) Grants will be awarded only when there are sufficient funds available in the Seismic Rehabilitation Grants program.

(2) Grant funds shall be distributed to public education facilities and emergency services facilities as allocated by the Legislative Assembly.

(3) The maximum grant award is $2.5 million.

(4) There is no required match for this program.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 2-2017, f. & cert. ef. 8-8-17
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-1100 Grant Agreement Conditions

(1) The Authority will only enter into new agreements or amendments to existing agreements, with prior Grantees, if all reporting obligations under earlier agreements have been met.

(2) If the grant agreement has not been fully executed by all the parties within 60 days of grantee receiving contract document, funding shall be terminated. The money allocated to the grant shall be available for reallocation by the grant committee.

(3) The Authority or designee shall establish grant agreement conditions. Grantees shall comply with all grant agreement conditions.

(4) The Grantee shall comply with all federal, state and local laws and ordinances applicable to the work to be done under the agreement.

(5) Upon notice to the Grantee in writing, the Authority may terminate funding for projects not completed in the prescribed time and manner. The money allocated to the project but not used will be available for reallocation by the grant committee.

(6) The Grantee will account for funds distributed by the grant committee, using project expense forms provided by the Authority.

(7) The Grantee will obtain the necessary permits and licenses from local, state or federal agencies or governing bodies.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Or. Admin. R. 123-051-1200 Waivers, Exceptions and Appeals

(1) The Authority may waive non-statutory requirements of the grant program if it is demonstrated such a waiver would serve to further the goals or objectives of the program.

(2) The Authority may consider appeals of the grant committee’s funding decisions. Only the applicant may appeal. Appeals must be submitted in writing to the Authority within 30 days of the event or action that is being appealed. The Authority’s decision is final.

History

Statutory/Other Authority: ORS 285A.093, 285A.098, 401.910 & 2013 OL Ch. 782
Statutes/Other Implemented: ORS 285A.093, 285A.098 & 401.910
OBDD 13-2013, f. 12-30-13, cert. ef. 1-1-14

Division 52 BEGINNING AND EXPANDING FARMER LOAN PROGRAM (“AGGIE BONDS”)

Or. Admin. R. 123-052-1000 Purpose

(1) The purpose of these rules is to assist Applicants in applying for the benefits available under the Beginning and Expanding Farmer Loan Program (aka “Aggie Bonds Program”) authorized by ORS 285A.420 to 285A.435 and to describe the procedures to be used by the Oregon Business Development Department in administering that Program.

(2) The Program lowers the interest cost on loans made by private parties to Beginning Farmers for the acquisition of Agricultural Land and Agricultural Improvements and Depreciable Agricultural Property. This is accomplished by Beginning Farmers arranging loans through Eligible Lenders in compliance with the rules in this Division, so that the Eligible Lender may exclude interest from gross income under Section 147(c)(2) of the United States Internal Revenue Code and may exempt interest from Oregon personal income taxes.

(3) Section 147(c)(2) of the United States Internal Revenue Code, its regulations and ORS 285A.420 to 285A.435 impose very substantial restrictions on the Program; the administrative rules in this Division outline those restrictions to assist Applicants in determining whether they may qualify for the Program.

(4) The Program does not provide any state or federal money to repay Beginning and Expanding Farmer loans, to guarantee these loans, or to repay any Aggie Bonds that are issued under the Program. Those loans and the related Aggie Bonds are secured only by the resources that eligible Beginning Farmers provide to lenders.

(5) A lender under the Aggie Bonds Program may become a “Participating Lender.” A Participating Lender will be familiar with the Aggie Bonds Program and will have executed a master financing agreement for Aggie Bonds with the Department. The Department will maintain a list of Participating Lenders and make that list available to people considering Aggie Bond financing.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1100 Definitions

For the purposes of these rules, the following terms shall have the following meanings, unless the context clearly indicates otherwise:

(1) “Aggie Bonds” means conduit revenue bonds issued by the State of Oregon pursuant to ORS 285A.420 to 285A.435 and these rules.

(2) “Agricultural Improvements” means any improvements, buildings, structures or fixtures suitable for use in farming that are located on Agricultural Land. “Agricultural Improvements” do not include personal residences.

(3) “Agricultural Land” means land located in the State of Oregon that is:

(a) Suitable for use in farming and that is or will be operated as a farm; and

(b) That will be acquired by a Beginning Farmer.

(4) “Applicant" means any person who submits an Application for Aggie Bond financing.

(5) “Application” means an Application for Aggie Bonds that is submitted to the Department on a form provided by the Department.

(6) “Beginning Farmer” means an individual who meets the requirements of OAR 123-052-1300 and is therefore eligible to be a Borrower under the Program.

(7) “Bond Counsel” means the bond counsel firm(s) under contract with Oregon Business Development Department to represent the State of Oregon as issuer of Aggie Bonds.

(8) “Borrower” means a Beginning Farmer who has received Aggie Bond financing under the Program.

(9) “Code” means the United States Internal Revenue Code of 1986, as amended, and all rules, regulations, and notices and releases issued under it.

(10) “Department” means the Oregon Business Development Department, or its designee.

(11) “Depreciable Agricultural Property" means property of a character subject to the allowance for depreciation in computing federal income tax under the Code, that is to be used in trade or business of farming. “Depreciable Agricultural Property” includes but is not limited to farm machinery and trucks, but does not include feeder livestock, seed, feed, fertilizer and other types of inventory or supplies.

(12) “Eligible Lender” means a lender who meets the requirements of OAR 123-052-1500.

(13) “Eligible Revenue” means the revenue or assets that are provided as security for a loan to a Beginning Farmer participating in the Program.

(14) “Federal Maximum” means the maximum amount of a loan that federal law allows to be financed under the Program. For calendar year 2016 the Federal Maximum is $520,000. This amount may be adjusted for inflation in future calendar years as provided for in Section 147(c)(2)(H) of the Code.

(15) “Financed Property” means property described in OAR 123-052-1400(1)(a) which is financed through the Program.

(16) “Financing Agreement” means an agreement between the Department and the Eligible Lender, in substantially the form and with the substance acceptable to the Department, which describes the requirements for an Aggie Bond to be issued to an Eligible Lender.

(17) “Lender Documents” means the Financing Agreement and the Loan Agreement and related documents between an Eligible Lender and a Beginning Farmer, including but not limited to any related security documents such as mortgages, deeds of trust and security agreements.

(18) “Participating Lender” means an Eligible Lender with substantial experience making agricultural loans, that has familiarized itself with these administrative rules and Oregon’s Aggie Bond Program, and has entered into, or will enter into prior to bond closing, a master financing agreement with the Department.

(19) “Permitted Costs” means any costs of property described in OAR 123-052-1400(1)(a).

(20) “Program” means the Beginning and Expanding Farmer Loan Program authorized by ORS 285A.420 to 285A.435 and described in these rules.

(21) “Related Person” means a person other than the Borrower if:

(a) The relationship between the Borrower and that person would result in a disallowance of losses under section 267 or 707(b) of the Code, or

(b) The Borrower and that person are members of the same controlled group of corporations (as defined in section 1563(a), except that “more than 50 percent” shall be substituted for “at least 80 percent” each place it appears therein). For example, a Related Person includes a grandparent, parent, sibling (whether whole or half-blood), child, grandchild, or spouse, as well as certain corporations and partnerships.

(22) “State” means the State of Oregon, any department, agency, or political subdivision of the State of Oregon, or any designee thereof.

(23) “Standard Lender” means an Eligible Lender that is not a Participating Lender.

(24) “Substantial Farmland” means any parcel of land unless the parcel is smaller than 30 percent of the median size of a farm in the county where the agricultural project is located. However, Substantial Farmland does not include farmland which was previously owned by the individual seeking to qualify as a Beginning Farmer if the farmland was disposed of while the individual was insolvent and Code section 108 applied to indebtedness with respect to that farmland.

(25) “Tax-exempt” means excludable from gross income under the Code, and exempt from Oregon personal income taxation.

(26) “State Treasurer" means the Treasurer of the State of Oregon or the Treasurer's designee.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2016(Temp), f. & cert. ef. 2-9-16 thru 8-5-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1150 Aggie Bonds Purchased By Participating Lenders

(1) An applicant seeking Aggie Bond financing through a Participating Lender must apply to the Program on a form provided by the Department. That Application must be accompanied by a non-refundable application fee of $250.

(2) Once the Department receives an Application and any other information required by the Department, if the Department determines that the Applicant and the assets the Applicant wishes to finance appear to qualify for Aggie Bond financing, the Department shall prepare and sign a reimbursement declaration for the Application and notify the Applicant and the Participating Lender. After the Department notifies the Applicant and the Participating Lender:

(a) The Department and the Participating Lender shall prepare a schedule for the proposed financing, and shall modify that schedule as circumstances require.

(b) The Department shall schedule the “TEFRA” hearing and provide the Application and any required information to bond counsel as provided in the schedule.

(c) The Participating Lender shall prepare and circulate a draft loan agreement and other documents that the Participating Lender prepares as provided in the schedule. The loan agreement shall be in a form acceptable to the Department.

(d) Bond counsel shall review the application, circulate drafts of documents to be prepared by bond counsel, and conduct tax due diligence. When the tax due diligence is complete and bond counsel is prepared to issue its approving opinion, bond counsel shall notify the Department and the Participating Lender.

(3) After bond counsel notifies the Department and the Participating Lender that bond counsel is prepared to issue its approving opinion, the Department shall request that the State Treasurer approve issuance of the bonds, and shall work with the Applicant, the Participating Lender and bond counsel to close the Aggie Bonds for the Applicant.

(4) The Department may impose additional requirements in connection with Aggie Bonds that are purchased by Participating Lenders.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16

Or. Admin. R. 123-052-1300 Requirements for Beginning Farmers

(1) As required by federal law, a Beginning Farmer must:

(a) Be a “first-time farmer” within the meaning of Section 147(c)(2) of the Code. That section of the Code generally provides that a first-time farmer is an individual who has not at any time had any direct or indirect ownership interest in Substantial Farmland in the operation of which the individual has materially participated. However, in certain cases land that was disposed of while the individual was insolvent may be disregarded for this purpose. Dispositions of land while the individual was insolvent should be listed in the Application for Program financing.

(b) Be a principal user of the Financed Property.

(d) Not have received tax-exempt financing under Section 147(c)(2) of the Code in an aggregate amount that, when added to the amount financed through the Program, exceeds the Federal Maximum.

(2) A Beginning Farmer must be a resident of the State of Oregon.

(3) Any property owned by an individual’s spouse or minor children will be treated as owned by the individual. Any material participation in the operation of a farm by an individual’s spouse or minor children will be treated as operation of that farm by the individual. Any receipt of Tax-exempt financing by an individual’s spouse or minor children will be treated as receipt by the individual.

(4) A Beginning Farmer and Applicant’s spouse must have total combined personal net worth of no more than $750,000, as evidenced by a signed, dated personal financial statement on a form satisfactory to the Department.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1400 Requirements for Property Financed through the Program

(1) Federal law requires that:

(a) Property financed through the Program consist only of:

(A) Agricultural Land as defined in OAR 123-052-1100(3).

(B) Agricultural Improvements as defined in OAR 123-052-1100(2).

(C) Depreciable Agricultural Property, as defined in OAR 123-052-1100(11), that is used for farming on Agricultural Land.

(i) The total amount of used Depreciable Agricultural Property that is financed through the Program may not exceed the maximum amount permitted by federal law. The Applicant must provide the Department with an appraisal or other method of determining the value of any used Depreciable Agricultural Property that will be financed through the Program. The appraisal or other method of determining the value of any used Depreciable Agricultural Property must be satisfactory to the Department. On the date these rules are adopted, the maximum amount permitted by federal law for this purpose is $62,500; this amount may change periodically.

(ii) The total amount of new and used Depreciable Agricultural Property that is financed through the Program may not exceed the maximum amount permitted by federal law. On the date these rules are adopted, the maximum amount permitted by federal law for this purpose is $250,000; this amount may change periodically

(iii) The limits of subsections (i) and (ii) of this subsection (C) apply to all Depreciable Agricultural Property with respect to which the principal user is or will be the same person or 2 or more Related Persons.

(b) No more than two percent of the borrowed funds are used to pay costs related to obtaining the loan or participating in the Program.

(c) The Code limits the use of Aggie Bond proceeds to acquire property from a Related Person (as defined in OAR 123-052-1100(21)). Property may be acquired from a Related Person only if:

(A) The acquisition price is the fair market value of the property, as shown in an independent, professional appraisal that is performed to qualify the property for financing with the Program and is acceptable to the Department; and

(B) The Related Person will not have a financial interest in the farming operation in which the Financed Property is used.

(2) The Financed Property is located, or will be used, in the State of Oregon.

(3) The Financed Property will only be used for farming by the Beginning Farmer or by the Beginning Farmer and the Beginning Farmer’s family.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1500 Requirements for Standard Lenders

(1) A Standard Lender must either be:

(a) An insured institution, as defined by ORS 706.008, that is authorized to do business in Oregon and that makes loans to persons engaging in farming or similar operations;

(b) An "Accredited Investor" (AI) as defined under Section 3(a)(2) of the Securities Act of 1933;

(d) A "Sophisticated Investor" (SI) as defined in Rule 501 of Regulation D under the Securities Act of 1933 and as further described in 17 CFR 230.506(b)(2)(ii) as one who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment.; or

(e) An institution organized and existing under the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.)

(2) The Standard Lender must represent in writing that it is an insured institution, AI, QIB, SI, or an institution organized and existing under the Farm Credit Act of 1971, pursuant to 123-052-1500(1), that the aggie bonds are being acquired for investment, and that the lender intends to hold the aggie bonds for the lender’s own account and not with a view to, or for resale.

(3) Under no circumstances can a Standard Lender be a substantial user of the Financed Property or related to a substantial user of that property. For this purpose “related” means a Related Person within the meaning of OAR 123-052-1100(21) but shall also include a partnership and any of its partners (and their spouses and minor children), and an S corporation and each of its shareholders (and their spouses and minor children).

(4) The Standard Lender must execute a Financing Agreement in substantially the form and with the substance of the form of Financing Agreement provided by the Department, or must use a form that is specifically approved in advance and in writing by the Department. The Standard Lender must make loans under Loan Agreements that are substantially in the form and with the substance of the form of Loan Agreement provided by the Department, or must use a form that is specifically approved in advance and in writing by the Department.

(5) Seller financing is allowed, subject to the provisions of the Code, State Treasurer, OAR 123-052, including the Securities Act of 1933.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 7-2015, f. & cert. ef. 9-1-15
OBDD 4-2015(Temp), f. & cert. ef. 7-13-15 thru 1-8-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1600 Additional Requirements for Aggie Bonds

(1) The expenditures financed under the Program cannot exceed the Federal Maximum, reduced by the total amount of Tax-exempt financing under Section 147(c)(2) of the Code that the Borrower, the Borrower’s spouse or minor children have received.

(2) The Department must obtain an allocation of private activity bond volume cap for each Aggie Bond from the Department’s legislative allocation or the private activity bond committee. If an adequate allocation is not available for any reason, the Aggie Bond will not be issued until such allocation is made to the Program.

(3) The Department must hold a “TEFRA hearing” and the State Treasurer must approve the issuance of each Aggie Bond.

(4) The Lender Documents must not secure the loan with any stock, other equity securities, any debt securities or any other “investment property” (within the meaning of Treasury Regulation section 1.148 1(b), or require that the Borrower maintain continuing balances of specified amounts in accounts in financial institutions.

(5) To obtain the approving opinion of the Program’s Bond Counsel for a bond purchased by a Standard Lender:

(a) The Borrower must complete a tax and arbitrage certificate, in form and substance satisfactory to the Department and the Program’s bond counsel, certifying the accuracy of facts that are necessary for Program Bond Counsel to issue its approving opinion and stating that the Borrower shall be solely responsible for compliance with Federal arbitrage restrictions.

(b) The lender must represent that it complies with sections (2) and (3) of OAR 123-052-1500.

(c) The State, the Borrower and the lender must execute any other documents required by the Program’s Bond Counsel in order to deliver its approving tax and legal opinions.

(6) At closing, the Borrower shall execute a post-issuance tax compliance agreement satisfactory to the Program’s Bond Counsel.

(7) The Borrower and lender shall be responsible for reviewing disbursement requests to confirm eligible uses of bond proceeds.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1610 Application When Aggie Bonds are Purchased by a Standard Lender

(1) An Applicant must apply for qualification to the Program on a form provided by the Department.

(2) Each Application shall:

(a) Contain a representation that the Application is an individual who has reviewed the Program rules and determined that the Applicant qualifies as a Beginning Farmer as described in OAR 123-052-1300.

(b) Contain a description of the costs to be financed through the Program, together with a representation that those costs are Permitted Costs that comply with the requirements of these administrative rules.

(c) Be accompanied by a commitment, letter of interest or similar document satisfactory to the Department, from the proposed Standard Lender that:

(A) Outlines the terms of the proposed loan;

(B) Expresses the lender’s interest in making the loan through the Program;

(C) States that the lender is qualified to make an Aggie Bond loan under OAR 123-052-1500, and provides facts supporting this statement.

(D) States whether the Lender will require that the Applicant receive training in farm management.

(E) States that the Lender has reviewed, and is willing to execute, a Financing Agreement in substantially the form provided by the Department, and is willing to make the proposed loan under a Loan Agreement substantially in the form and with the substance of the form of Loan Agreement provided by the Department.

(d) States that the Applicant has reviewed the form of Loan Agreement provided by the Department and is willing and able to make the certifications and promises, including the federal tax certifications, provided in that form.

(e) Be accompanied by an application fee of $250. This fee is not refundable.

(f) Unless the Financed Property will consist exclusively of new Depreciable Agricultural Property, be accompanied by an appraisal that is satisfactory to the Department. The Lender should contact the Department to determine the Department’s requirements for appraisals before the Lender orders an appraisal.

(g) Contain any other information or documents specified in the Application form provided by the Department.

(3) The Department shall review each completed Application and notify the Applicant within thirty days indicating whether the Applicant, the proposed project and the proposed lender appear eligible for the Program.

(4) Expenditures made by the Borrower more than sixty days before the Aggie Bonds are issued generally are not eligible for financing with Aggie Bonds unless the Department has signed a Reimbursement Declaration. If the Department signs a reimbursement declaration, expenditures made more than sixty days before the Reimbursement Declaration is signed are generally not eligible for financing with Aggie Bonds. If the Department determines that the Applicant, the proposed project and the proposed lender appear eligible for the Program, the Department shall sign a Reimbursement Declaration that complies with the requirements of Section 1.150-2 of the Code. Execution of the Reimbursement Declaration by the Department permits the Borrower to use the Program to finance certain expenditures made no earlier than sixty days before such Reimbursement Declaration is signed, but does not assure the Applicant that any Aggie Bond will be issued. The Department shall notify the Applicant promptly upon execution of the Reimbursement Declaration.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16

Or. Admin. R. 123-052-1700 Procedure after Preliminary Eligibility Determination for Aggie Bonds to be Purchased by Standard Lenders

(1) If the Department notifies the Applicant that the Applicant, the proposed project and the proposed lender appear eligible for the Program, the Borrower may file a request for a final eligibility determination with the Department. The request for final eligibility determination shall be filed on a form provided by the Department, and shall contain:

(a) A detailed description of the costs to be financed;

(b) A statement, signed by the Borrower and in substantially the form provided by the Department that the Borrower is a Beginning Farmer who meets the requirements of OAR 123-052-1300, and that the Aggie Bond proceeds will be spent in compliance with these administrative rules.

(A) Attaching drafts of the Financing Agreement and other Lender Documents, in substantially final form;

(B) Describing the principal amount of the requested Aggie Bonds, whether lender’s loan is a line of credit, and the interest rate and other material loan terms , including but not limited to all fees and points being charged by the lender (if not stated in the Lender Documents).

(C) That the lender is eligible to purchase Aggie Bonds under OAR 123-052-1500, and providing facts supporting this statement.

(D) That the lender has completed its credit review and is prepared to make the loan under the Lenders Documents provided to the Department, and that no significant contingencies remain.

(d) A signed, completed final tax questionnaire on a form provided by the Department.

(e) Any other information specified in the form of request for final eligibility determination provided by the Department.

(2) The Department shall review the request for final eligibility determination when the completed request has been filed with the Department and make a final eligibility determination. The final eligibility determination may be favorable or unfavorable.

(a) The Department shall notify the Applicant of a favorable final eligibility determination no later than five business days after Program Bond Counsel notifies the Department that it expects to be able to issue an approving opinion. The notice of a favorable final eligibility determination shall state that that financing described in the Application and request for final eligibility determination is eligible for Aggie Bond financing, and that the Applicant is authorized to proceed to closing, subject to any conditions imposed by the Department in the final eligibility determination.

(b) The Department shall notify the Applicant of an unfavorable final eligibility determination no later than five business days after either one of the following occurs first:

(A) The Department determines that the financing does not qualify under Oregon law or these rules for Aggie Bond financing; or

(B) Program Bond Counsel notifies the Department that it does not expect to be able to issue an approving opinion.

(c) The notice of an unfavorable final eligibility determination shall state that that financing described in the Application and request for final eligibility determination is not eligible for Aggie Bond financing. Unless appealed, an unfavorable final eligibility determination shall become final on the eleventh day after the Department notifies the Applicant of that determination.

(d) The Applicant is entitled to appeal the unfavorable final eligibility determination to the Finance Committee of the Oregon Business Development Commission by filing a notice of appeal with the Department no later than ten business days after the Department notifies the Applicant of the unfavorable final eligibility determination. Any decision by the Finance Committee of the Oregon Business Development Commission on an appeal is final when it is made.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-1900 Bond Counsel Opinion for Aggie Bonds Purchased by Standard Lenders

(1) The state requires the Applicant and the Standard Lender obtain a traditional approving opinion from the Program’s Bond Counsel concluding that the Aggie Bond issued for the Applicant is a valid and binding obligation of the State, and that interest on the Aggie Bond is Tax-exempt.

(2) If the Department determines that the financing described in the Application and request for final eligibility determination, filed by the Applicant pursuant to OAR 123-052-1700, is eligible for participation in the Program, the Department shall forward the request for final eligibility determination to the Program’s Bond Counsel. Program Bond Counsel shall:

(a) Conduct tax due diligence, determine whether it will be able to issue approving opinions on the proposed Aggie Bonds, and notify the Department of that determination.

(b) Assuming Bond Counsel determines it will be able to issue approving opinions on the proposed Aggie Bonds:

(A) Review the draft Financing Agreement and Loan Agreement provided by the lender and send required changes to the Borrower and lender for review;

(B) Provide forms of tax and arbitrage certificates, and other necessary documents, for the Borrower and lender to execute

(3) If Bond Counsel determines it will be able to issue an approving opinion on a proposed Aggie Bond, the Department will forward the Aggie Bond documents to the Treasurer with a request that the Treasurer approve the issuance of the Aggie Bond. The Treasurer, an independent, elected official of the State of Oregon, has no legal obligation to approve any Aggie Bond issue. If the Treasurer approves issuance of an Aggie Bond, the Department will coordinate the closing with the Borrower, the lender, the State Treasurer, and Bond Counsel.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-2000 Fees and Costs

(1) The Applicant shall pay the Department the nonrefundable $250 application fee.

(2) At closing, the Department may require the Borrower to pay the following costs or fees:

(a) A bond closing fee of 1.5% of the total Aggie bonds issued for the project, with a minimum of $1,500, payable to the Department.

(b) Out of pocket costs or fees of the State, including but not limited to any indirect costs charged to the Department or Treasurer by Oregon Department of Justice for complex transactions.

(c) State Treasurer’s costs or fees related to the review, approval and processing of each Aggie Bond issuance request and issuance.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 8-2016, f. & cert. ef. 8-3-16
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-2100 Security for Aggie Bonds

(1) Each Aggie Bond will be a special, limited obligation of the State of Oregon that is payable solely from the Eligible Revenue paid to the lender as provided in the Lender Documents

(2) As required by ORS 285A.420 to 285A.435, the Aggie Bonds are not:

(a) Secured by, payable from or chargeable to moneys other than the Eligible Revenue that is committed to pay the Aggie Bonds;

(b) A liability of the State of Oregon. No lender or other owner of an Aggie Bond may: compel an exercise of the taxing power of the State of Oregon to pay any Aggie Bonds or the interest on any Aggie Bonds or enforce payment of any Aggie Bonds against any property of the State of Oregon except the Eligible Revenue that is committed to pay the Aggie Bond.

(c) A charge lien or encumbrance, legal or equitable, upon any property of the State of Oregon, except the Eligible Revenue that is committed to pay an Aggie Bond.

(3) No Aggie Bond shall be a general obligation of the Department, the State of Oregon, or any department, agency, or political subdivision of the State of Oregon.

(4) The full faith and credit of the Department or the State of Oregon or any department, agency, or political subdivision of the State of Oregon shall not be pledged for the payment of any Aggie Bond.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-2200 Waiver

The Department may, in its discretion, waive any of the requirements of these administrative rules to the extent such requirements are not otherwise imposed by law.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-2300 Authority to Manage the Program

The Program shall be managed by the Department or its designee, and is not a Program of the Business Development Commission.

History

Statutory/Other Authority: ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 3-2015, f. & cert. ef. 2-24-15

Or. Admin. R. 123-052-2400 Confidential Records

(1) Upon written request and within a reasonable time, the Department shall provide program records for inspection in accordance with ORS Chapter 192.

(3) Except as otherwise provided in ORS 192.410-192.595, records exempt from disclosure include but are not limited to:

(b) Financial statements, tax returns, business records, employment history and other personal data submitted by or for Applicants, or analysis of such data;

(d) Formulas, plans, designs and related information that constitute trade secrets under ORS 192;

(e) Personal financial statement;

(f) Financial statements of Applicants;

(g) Customer lists;

(h) Information of an Applicant pertaining to litigation to which the Applicant is a party if the complaint has been filed, or if the complaint has not been filed, if the Applicant shows that such litigation is reasonably likely to occur. This exemption does not apply to conclude litigation and nothing in this section shall limit any right or opportunity granted by law to a party involved in litigation;

(i) Production, sales or cost data; and

(j) Marketing strategy information that relates to an Applicant's plan to address specific markets and Applicant's strategy regarding specific competitors.

History

Statutory/Other Authority: ORS 192.410 – 192.595, ORS 285A.420 - 285A.435 & ch. 742 OL 2013
Statutes/Other Implemented: ORS 192.410 -192.595, ORS 285A.420.420 - 285A.435 & ch. 742 OL 2013
OBDD 3-2015, f. & cert. ef. 2-24-15

Division 53 HOUSING INFRASTRUCTURE FINANCE PROGRAM

Or. Admin. R. 123-053-0011 Purpose and Objectives

These rules provide for the Oregon Infrastructure Finance Authority’s administration and implementation of the Housing Infrastructure Finance Program (referred to as “Program” for this Chapter 123, Division 53 of Oregon Administrative Rules) established in Oregon Laws 2025, Chapter 497 for the purpose of providing grants, loans and forgivable loans to Eligible Applicants for Projects that will primarily support the water, wastewater, stormwater and transportation infrastructure for a Specified Proposed Housing Development.

History

Statutory/Other Authority: Oregon Law 2025, Chapter 497
Statutes/Other Implemented: Oregon Law 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0021 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR Chapter 123 Division 001. The following terms have the meanings set forth below, unless the context clearly indicates otherwise.

(1) “Affordable Housing Covenant” has the meaning provided in ORS 456.270.

(2) “Area Median Income” means the median income for the metropolitan statistical area in which the proposed affordable housing is located, as determined by the Oregon Housing and Community Services Department, adjusted for household size.

(3) “Award” means financial assistance from the Fund that may take the form of a Program grant, loan, forgivable loan or combination of such financial assistance.

(4) “Authority” means the Oregon Infrastructure Finance Authority (IFA) within the Oregon Business Development Department and established by ORS 285A.096.

(5) “Board” means the Oregon Infrastructure Finance Authority Board created by ORS 285A.091.

(6) “Covenant Holder” means:

(a) A public body, as defined in ORS 174.109;

(b) An agency of the United States government;

(c) A public benefit corporation or religious corporation, as those terms are defined in ORS 65.001, one purpose of which is to provide affordable housing for low or moderate income households;

(d) A consumer housing cooperative, as defined in ORS 456.548;

(e) A manufactured dwelling park nonprofit cooperative corporation; or

(f) A federally recognized Indian tribe.

(7) “Eligible Applicant” means a city, county, a county service district organized under ORS chapter 451, a district as defined in ORS 198.010, an intergovernmental entity formed under ORS chapter 190, or a tribal council of a federally recognized Indian tribe in Oregon.

(8) “Fund” means the Housing Infrastructure Financing Program Fund established by Oregon Laws 2025, Chapter 497, section 3.

(9) “Housing Development” means the collection of residential houses or apartments on a specific tract of land that may include detached single-family housing, Middle Housing, or multifamily housing that is owned or rented.

(10) “Housing Developer” means a (a) person or business that owns or buys land or existing buildings, adds value through new construction or refurbishment, and then sells or rents out the completed residential properties to make a profit; or (b) nonprofit entity that own or buys land or existing buildings, adds value through new construction or refurbishment, and then sells or rents out the completed properties, focusing on serving vulnerable populations, including but not limited to providing housing for low income individuals and families, seniors, and individuals with special needs.

(11) “Middle Housing” means the housing described in ORS 197A.420, and includes duplexes, triplexes, quadplexes, cottage clusters, and townhouses.

(12) “Net Residential Acre” mean an acre of buildable land, not including rights of way for streets, roads, or utilities or areas not designated for development due to natural resource protections or environmental constraints, that is zoned for residential use.

(13) “Project” means (a) the development or improvement of transportation, water, wastewater or stormwater infrastructure, including improvements to system capacity; or (b) site development, including the development of privately owned sites, necessary for the improvement of transportation, water, wastewater or stormwater infrastructure; and (c) the proposed development in (a) or (b) will primarily support a Specified Proposed Housing Development.

(14) “Review Committee” means a committee that will review and score Program applications according to the terms set forth in any solicitation for Program Awards. Committee members will be appointed by the Oregon Infrastructure Finance Authority Administrator or designee and generally will serve for one Program application cycle. Eligible Review Committee members are individuals from State agency staff from the Oregon Business Development Department and other state agencies as determined by the Authority and may include the Housing Accountability and Production Office (established and administered by the Department of Land Conservation and Development and the Department of Consumer and Business Services), and Oregon Housing and Community Services.

(15) “Specified Proposed Housing Development” means a Housing Development that has moved beyond a conceptual phase and is a planned, detailed real estate project that outlines the construction of residential units on a specific tract of land that includes design, project scope, and funding needs.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0031 Loan, Grant and Forgivable Loan Information

(1) The Authority may provide Awards in a manner that maximizes the use of available resources and maintains the desired credit standards of the Fund. The Authority shall determine the amount, type, interest rate and other terms of any Awards. The Authority may offer an Award of a lower amount or a different type of financial assistance than requested by the Eligible Applicant. The amount of the Award may be the minimum amount that the Authority determines is necessary to enable the Project to proceed.

(2) To be eligible for an Award, the Project’s Specified Proposed Housing Development must be located within an urban growth boundary, on a reservation of a federally recognized Indian tribe, or on tribal trust land.

(3) Grants and Forgivable Loans:

(a) To be eligible for a Program grant or forgivable loan, the housing to be developed within the Specified Proposed Housing Development supported by the Project must be subject to an Affordable Housing Covenant under which:

(A) The Award recipient shall serve as, or designate, the Covenant Holder; and

(B) The housing will be made affordable to households with low income (which may include very low income) or moderate income, as those terms are defined in ORS 458.610, i.e. households with income less than or equal to 120 percent of the Area Median Income:

(i) For a period of no less than 10 years from the date on which the housing is first available for occupancy as rental housing; or

(ii) For a period of no less than 5 years from the date on which the housing is first sold as owner-occupied housing.

(b) If less than all of the housing supported by the Project (i.e. the infrastructure) to be developed within the Specified Proposed Housing Development will be subject to an Affordable Housing Covenant that meets the requirements of (4)(a) of this rule, the grant or forgivable loan amount will be subject to a not-to-exceed amount that is calculated based on the following formula: number of housing units subject to Affordable Housing Covenants within the Specified Proposed Housing Development divided by the total number of housing units within the Specified Proposed Housing Development multiplied by the total Project costs. For example, if a water infrastructure Project will cost $1 million, and half of the Specified Proposed Housing Units will be market rate and half will be subject to an Affordable Housing Covenant, the maximum grant or forgivable loan amount is $500,000.

(4) Loans:

(a) Maximum loan amounts for a Project will be based on the Authority’s financial and credit analysis of the Eligible Applicant’s capacity to repay the loan, the availability of moneys in the Fund, and prudent Fund management. Projects that are not financially feasible, or Loans that cannot be adequately secured, as determined by the Authority, will not be funded.

(b) A Project may receive a Program loan subject to the following conditions:

(A) The term of a loan is limited to the usable life of the contracted project, or 29 years from the year of project completion whichever is less;

(B) The interest rate on a loan will be determined by the Authority and will be set at the time of the Program Award; and

(C) The repayment terms of a loan may include deferred repayment of principal and/or interest for a specified term of the loan to address special circumstances and financial feasibility of a Project as determined by the Authority.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0041 Application Prioritization

(1) When making grant or forgivable loan Program Award decisions, the Authority will prioritize Projects with rental housing that will be made affordable to households with low income (which may include very low income) or moderate income through an Affordable Housing Covenant, for a period of at least 30 years from the date on which the housing is first available for occupancy as rental housing, over other Projects with rental housing that will be made affordable through an Affordable Housing Covenant that is for a term less than 30 years (but still must be at least 10 years to be eligible for a grant or forgivable loan).

(2) When making grant, forgivable loan, and loan Program Award decisions, the Authority will prioritize Projects that will result in a Housing Development with a minimum density of:

(a) For Projects within the Metro urban growth boundary, priority will be given to Projects with a minimum density of seventeen dwelling units per Net Residential Acre.

(b) For Projects within an urban growth boundary other than the Metro urban growth boundary:

(A) Ten units per Net Residential Acre if sited in a city, including territory to be annexed by the city upon completion of the Project, with a population of 25,000 or greater; or

(B) Six units per Net Residential Acre if sited in a city, including territory to be annexed by the city upon completion of the Project, with a population of at least 2,500 but less than 25,000; or

(C) Five units per Net Residential Acre if sited in a city, including territory to be annexed by the city upon completion of the Project, with a population of less than 2,500.

(c) For Projects within an Urban Growth Boundary but outside of city limits, priority will be given to Projects with a minimum density requirement of the closest city.

(d) For Projects located on tribal trust land or land of a federally recognized tribe, priority will be given to Projects with a minimum density requirements of five units per Net Residential Acre.

(3) When making Program Award decisions, the Authority may prioritize Projects based on:

(a) Project readiness to proceed with minimal delay;

(b) having a clear connection with addressing urgent housing need and supporting near-term housing production;

(d) the Award leveraging other funding or bridging gaps in funding;

(e) meaningfully impact to quality of life and economic opportunity for the persons in the Project location;

(f) geographic location of the Project so as to result in the distribution of Fund resources statewide;

(g) the Project supporting other state and local goals and priorities; and

(h) any other factors or considerations that the Authority includes in any Program solicitation.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0051 Allowable Project Costs

Allowable Project costs include:

(1) Financing costs, including capitalized interest;

(2) Direct Project management costs;

(3) Costs of consultant services and expenses;

(4) Construction costs and expenses;

(5) Costs of property acquisition, including any easement, or right of way directly related to and necessary for the Project; and

(6) Other costs that the Authority determines to be necessary.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0061 Ineligible Projects and Ineligible Project Costs

(1) Projects that the Authority determines are not financially feasible are ineligible Projects. This includes but is not limited to Projects that do not have sufficient capital to complete the Project and those that do not have adequate funds to cover ongoing costs over the long term.

(2) Expenses and costs expressly allowed under this division of rules are eligible for reimbursement from the Fund. All other costs are ineligible for reimbursement including but not limited to:

(a) Purchase of general purpose motor vehicles and equipment not essential to or for the Project;

(b) Project operating or maintenance costs, except as allowed by statute;

(c) Costs not permitted to be paid for with bond proceeds funding the contract as provided under the terms of the contract; and

(d) Costs not related to the development or improvement of transportation, water, wastewater or stormwater infrastructure to support the Specified Proposed Housing Development as determined by the Authority.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0071 Application Requirements

(1) An application for a Program Award must be submitted to the Authority in the form provided by the Authority and must contain or be accompanied by such information and documentation as the Authority requires in its solicitation for applications, generally called a request for applications (“RFA”).

(2) A Program application must be submitted by an Eligible Applicant.

(3) Notwithstanding (2) of this rule, a housing authority as defined in ORS 456.005 or a Housing Developer (each respectively referred to as “Partner”) may apply with an Eligible Applicant. The Authority will make Award disbursements only to a successful Eligible Applicant (i.e. Award recipient) and not a Partner. However, a successful Eligible Applicant with a Partner may enter into a sub-agreement with a Partner to complete the Project and the Partner may receive Award funding from the Eligible Applicant for the Project. In addition, a Partner may be required to sign the binding contract described in OAR 123-053-0080, along with the Award recipient depending on the financing details of the Project. The contract will provide terms providing for the Partner’s obligations with respect to the Project, including financial obligations.

(4) The Authority may require a copy of any sub-agreement between a successful Eligible Applicant and a Partner that enumerates the Partners’ responsibilities, including financial responsibilities, appropriate allocations of moneys and responsibility for loan repayment or grant performance.

(5) The Authority may assist applicants in understanding Program requirements and in completing applications. The Authority will process only completed applications.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0081 Contracts and Disbursements of Funds

(1) The Authority shall make disbursements to an Award recipient only after entering into a binding contract with the Award recipient.

(2) The contract will be in a form provided by the Authority, and must include:

(a) Terms for Award disbursements, which shall be conditional payments made on an expense reimbursement or cost-incurred basis for eligible Project costs;

(b) A provision that the Authority’s obligation to disburse the Award is contingent upon the availability of moneys in the Fund;

(c) A Project description defining the location and the infrastructure comprising the Project and eligible use of the Award with a Project budget;

(d) The Project performance standards expected of the Award recipient, including a deadline for Project completion;

(e) Project reporting requirements to document Project progress and evaluate the Program (reporting requirements may be ongoing and may include such information and data on the Housing Development’s benefits, data on number of new dwelling units built by type, and occupancy rates);

(f) The terms for loan repayment if the Award includes a loan;

(g) For an Award that includes a grant, the terms for repayment if the contract obligations of the Award recipient are not met during the period of the contract;

(h) For an Award that includes a forgivable loan, the conditions of forgiveness and the terms of loan repayment if the conditions are not met;

(i) Affordable Housing Covenant obligations for the Award as applicable, which may include number of housing units in the Housing Development subject to an Affordable Housing Covenant, required duration (term of years) of the Affordable Housing Covenant, restrictions on use of real property to occupancy by low or moderate income households in rental or owner-occupied housing, restrictions on the rental rate or sale price of real property to ensure affordability by future low and moderate income households; right of first refusal before sale or an option to purchase by the Covenant Holder; and any other term permitted under ORS 456.280 and ORS 456.285;

(j) For an Award that includes an Affordable Housing Covenant obligation, a provision designating the Project’s Covenant Holder (Award recipient or recipient’s eligible designate) and requirements to ensure compliance with ORS 456.270 to 456.295, including enforcing the covenants for the appliable terms of years. At the Authority’s discretion and to avoid redundancy and financing complexities, the contract may permit non-Program restrictive covenants on the Specified Proposed Housing Development Project to meet the requirements of the Program if they meet or exceed the Affordable Housing Covenant requirements of the Program. For example, if the Oregon Housing and Community Services Department has or will have a restrictive covenant on the Specified Proposed Housing Development Project for a LIFT award that provides for low income housing requirements for a term of 30 years, that restrictive covenant may suffice and be referenced in the contract;

(k) Bond funding restrictions, including tax-exempt requirements, on the Award, as applicable; and

(l) Other provisions that the Authority considers necessary or appropriate to implement the Program.

(3) If an event of a default occurs under a contract for an Award, any recovered funds will be returned to the Fund and may be awarded to another Project.

(4) The contract must be authorized by an ordinance, order or resolution adopted by the governing body of the Award recipient in accordance with the Award recipient’s requirements for public notice and authorizing debt.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0091 Remedies

The Authority may invoke remedies for an “event of default” as described in the contract with the Award recipient, including but not limited to the following:

(1) Withholding of amounts otherwise due to the Award recipient;

(2) Barring the Award recipient from applying for future awards;

(3) Demanding return of any Award disbursed and any interest earned on the disbursed Award; and

(4) Any other remedies available at law or in equity.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0101 Grant Evaluation, Review and Approval

(1) The Authority will announce deadlines for submitting Program applications and provide the final evaluation criteria in the solicitation document.

(2) Complete applications submitted by Eligible Applicants will be evaluated by the Review Committee. The Review Committee will utilize the Program evaluation criteria to review and score applications. The Review Committee will also utilize the prioritization criteria provide in OAR 123-53-0040 in its scoring or ranking. The Review Committee will provide its Award recommendation to the Board which will make final decisions and approve any Award(s). The Board shall consider the Review Committee recommendations when approving Awards.

(3) Notwithstanding OAR 123-053-0100(2), Awards and contract execution may be contingent upon review and approval by the Oregon Legislative Assembly.

(4) Meeting the eligibility requirements and submitting a complete application does not guarantee a Program Award.

(5) The Review Committee may request additional information before making its Award recommendations.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Or. Admin. R. 123-053-0111 Appeals and Exceptions

(1) The Authority’s Award decisions are final and may not be appealed.

(2) In its sole discretion, the Authority or its designee may waive non-statutory requirements of the Program if it is demonstrated that such a waiver would serve to further the goals or objectives of the Program.

History

Statutory/Other Authority: Oregon Laws 2025, Chapter 497
Statutes/Other Implemented: Oregon Laws 2025, Chapter 497
OBDD 8-2026, adopt filed 04/24/2026, effective 04/24/2026

Division 56 LOCAL ECONOMIC OPPORTUNITY FUND

Or. Admin. R. 123-056-0010 Purpose

As provided in Oregon Revised Statutes (ORS) 285B.260, the Oregon Business Development Department shall administer the Local Economic Opportunity Fund to provide grants for projects that support economic development priorities as identified in approved local economic development strategies.

History

Statutory/Other Authority: ORS 285B.230 - 285B.266
Statutes/Other Implemented: ORS 285B.230 - 285B.266
OBDD 10-2013, f. 10-31-13, cert. ef. 11-1-13
OBDD 5-2013(Temp), f. & cert. ef. 6-3-13 thru 11-30-13

Or. Admin. R. 123-056-0020 Definitions

(1) “Department” means the Oregon Business Development Department.

(2) “Fund” means the Local Economic Opportunity Fund created by ORS 295B.260.

(3) "Approved Strategic Plan" means a strategic plan determined by the Department to meet the requirements set forth in OAR 123-056-0030.

History

Statutory/Other Authority: ORS 285B.230 - 285B.266
Statutes/Other Implemented: ORS 285B.230 - 285B.266
OBDD 10-2013, f. 10-31-13, cert. ef. 11-1-13
OBDD 5-2013(Temp), f. & cert. ef. 6-3-13 thru 11-30-13

Or. Admin. R. 123-056-0030 Strategic Plans

In order to be an Approved Strategic Plan, a strategic plan must:

(1) Identify, address and coordinate the economic development priorities of a community or geographic region in the state of Oregon

(2) Result in economic benefit to the state of Oregon, such as:

(a) Promotes favorable investment climate to strengthen businesses, create jobs, and raise real wages;

(b) Contributes in a manner that improves the national and global competitiveness of Oregon companies;

(d) Promotes, fosters and sustains economic development in the state, emphasizing rural and distressed areas; or

(e) Implements economic strategies that reinforce Oregon’s long-term prosperity and livability.

(3) Sets forth, in measurable terms, the extent to which the strategic plan will accomplish the economic development priorities of the community or geographic region of the state of Oregon;

(4) Sets forth, in measurable terms, the extent to which the strategic plan will accomplish the Department’s performance standards as adopted by the Oregon Business Development Commission; and

(5) Be formally adopted by a municipality, a special district, a port, or other governmental entity.

History

Statutory/Other Authority: ORS 285B.230 - 285B.266
Statutes/Other Implemented: ORS 285B.230 - 285B.266
OBDD 10-2013, f. 10-31-13, cert. ef. 11-1-13
OBDD 5-2013(Temp), f. & cert. ef. 6-3-13 thru 11-30-13

Or. Admin. R. 123-056-0035 Distribution of Funds

The Department, in its sole discretion, shall determine grants awarded from the Fund. The grant must support implementation of a project included in an Approved Strategic Plan.

History

Statutory/Other Authority: ORS 285B.230 - 285B.266
Statutes/Other Implemented: ORS 285B.230 - 285B.266
OBDD 10-2013, f. 10-31-13, cert. ef. 11-1-13
OBDD 5-2013(Temp), f. & cert. ef. 6-3-13 thru 11-30-13

Or. Admin. R. 123-056-0040 Waiver of Non-Statutory Requirements

The Director or the Director’s designee may waive non-statutory requirements of this division of administrative rules, if demonstrated that such a waiver serves to further the goals and objectives of ORS 285B.230 to 285B.266, and that it contributes to sound economic or community development.

History

Statutory/Other Authority: ORS 285B.230 - 285B.266
Statutes/Other Implemented: ORS 285B.230 - 285B.266
OBDD 10-2013, f. 10-31-13, cert. ef. 11-1-13
OBDD 5-2013(Temp), f. & cert. ef. 6-3-13 thru 11-30-13

Division 57 REGIONALLY BASED FUNDS

Or. Admin. R. 123-057-0510 Allocation

In each biennium: In accordance with ORS 285B.263 and 285B.266(3), the department may allocate a specific portion of the Strategic Reserve Fund to be used as the Strategic Regional Investment Opportunity Fund.

History

Statutory/Other Authority: ORS 285A.075, 285B.236(1) & 285B.263(2)
Statutes/Other Implemented: ORS 285B.263
EDD 30-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2008(Temp), f. & cert. ef. 3-4-08 thru 8-31-08
Reverted to EDD 20-2004, f. & cert. ef. 8-2-04
EDD 11-2007(Temp), f. & cert. ef. 9-5-07 thru 2-29-08
EDD 20-2004, f. & cert. ef. 8-2-04
EDD 6-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 6-2000, f. & cert. ef. 4-3-00

Or. Admin. R. 123-057-0530 Use and Criteria of Strategic Regional Investment Opportunity Project Moneys

In each biennium, the commission may allocate funds from the Strategic Reserve Fund to create a Strategic Regional Investment Opportunity Fund. The department shall allocate a portion of the fund to each Regional Investment Board based upon consultation with Association of Oregon Counties, League of Oregon Cities, and Oregon Public Ports Association. This allocation shall:

(1) Ensure that each Strategic Regional Investment Opportunity Fund Project actualizes one or more of the following:

(a) The project is developed and brought forward to the department by a regional partnership or board, Business Development Officers or business partners;

(b) The project can demonstrate a significant private business investment, short or long term job creation or other long-term economic development impacts that results in job creation;

(c) Greater competitiveness and productivity by the regions' traded-sector industries resulting in short term job creation or retention;

(d) The investment of these funds will close a critical gap in funding for eligible activities;

(e) Significant improvement in the variety, wage level and quality of jobs in the participating regions;

(f) Collaboration with one or more industries or institutions that are important to the regions' future:

(A) Eliminate barriers that impede competitiveness of existing businesses;

(B) Foster new or expanded businesses emerging in the regions;

(D)(i) Diversify the regional economies;

(ii) Similar goals consistent with or conducive to statewide efforts and priorities for economic and community development.

(2) Insist that Strategic Regional Investment Opportunity Projects adhere to funding standards, as follows:

(a) By satisfying sound investment/underwriting principles;

(b) By combining with funds from private, local, regional, state or federal sources; and

(c) By ensuring that the project is ready to proceed in terms of delivering planned outcomes in a reasonable time, including but not limited to a thorough scope of work in the project application, contract and reporting requirements as described in this rule, clear commitment of other resources and the absence of barriers to the project's timely commencement.

(3) Forbid Strategic Regional Investment Opportunity Fund Projects that amount to the following:

(a) A subsidy for ongoing capacity of an organization or for ongoing operation and maintenance of a facility;

(b) Open-ended efforts that lack a demonstrable and realistic plan for effectively concluding the project, generating future resources or ensuring the usefulness of any deliverables/capacity in the future; or

(4) The department shall fund projects in accordance with the following:

(a) The department shall facilitate the identification and undertaking of Strategic Regional Investment Opportunity Fund Projects, through communications and assistance to regional boards and fiscal entities through the department's Business Development Officers. Regions seeking to access their allocated portion of the funds shall do so through their regionally assigned Business Development Officer.

(b) Strategic Regional Investment Opportunity Fund projects addressing projects that meet the criteria as described in this rule may be advanced for approval upon joint recommendation of a regional partnership or regional boards response committee and a Business Development Officer. If the project is recommended, the Business Development Officer will draft a staff recommendation for signature.

(c) Following approval of project funding, projects are assigned to the most appropriate Division within the department to negotiate final project conditions if any, performance measures and to develop and execute contract documents. The contract will specify the process and timing of disbursements of funds, conditions for reporting results, terms for repayment of funds where appropriate and the process for project closeout.

History

Statutory/Other Authority: ORS 285A.075, 285B.236(1) & 285B.263(2)
Statutes/Other Implemented: ORS 285B.263
EDD 30-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2008(Temp), f. & cert. ef. 3-4-08 thru 8-31-08
Reverted to EDD 20-2004, f. & cert. ef. 8-2-04
EDD 11-2007(Temp), f. & cert. ef. 9-5-07 thru 2-29-08
EDD 20-2004, f. & cert. ef. 8-2-04
EDD 6-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 6-2000, f. & cert. ef. 4-3-00

Or. Admin. R. 123-057-0710 General Guidance

For purposes of ORS 285B.263(6), each region shall prepare and submit a biennial report to the Governor, Commission and Legislative Assembly:

(1) This biennial report shall be prepared and submitted in conformance with the following:

(a) Format and procedures that the department may prescribe; and

(b) The region's periodic performance reports and regional performance measures and distribution criteria including goals pursuant to OAR 123-055-0620 and ORS 285B.239.

(2) The final biennial report shall be due at a time determined by the department in relation to each general session of the legislature, and shall include information from prior biennia not covered in the previous biennial report, as well as the most currently available information for the ongoing biennium.

(3) The biennial report shall describe all expenditures of regionally controlled funds and, where multiple state funds are invested in a job creation or retention projects such as Strategic Regional Investment Opportunity Fund projects, the department will:

(a) In some manner, differentiate and proportion between the funding sources when reporting these job creation projects to the legislature.

(4) The biennial report shall indicate the success of projects and programs as funded or completed, not only in terms of the project or program itself, but also in terms of how each one contributes to:

(a) Carrying out the investment strategy as whole;

(b) Carrying out the rural action plan specifically;

(d) Achieving identified priorities for regional economic priorities, as both defined in statute and by the regional board itself in the investment strategy.

(5) The biennial report may (in addition to information about expenditures of regionally controlled funds and about funded projects) address the regional board and the investment strategy's general progress and impact, especially in coordination with other resources and entities.

(6) The biennial report shall indicate the success of projects and activities as funded in accordance with the regionally adopted, six-year Commission approved investment strategy and project funding criteria that has been established by the adoption of the strategy and goals as described in ORS 285B.239 thru 285B.263. The regions will be evaluated by department staff in accordance with ORS 285B.239(1)(h)(A), (B), (C) and 285B.239(1)(i), (j). If the department determines the region has funded projects not complying with the approved investment strategy, the department shall reduce future allocations from the Regional Fund in a like percent of the funds spent on the projects not meeting the adopted criteria established by the investment strategy.

History

Statutory/Other Authority: ORS 285A.075 & 285B.236(1)
Statutes/Other Implemented: ORS 285B.260 & 285B.263
EDD 30-2008, f. 8-28-08, cert. ef. 9-1-08
EDD 8-2008(Temp), f. & cert. ef. 3-4-08 thru 8-31-08
Reverted to EDD 20-2004, f. & cert. ef. 8-2-04
EDD 11-2007(Temp), f. & cert. ef. 9-5-07 thru 2-29-08
EDD 20-2004, f. & cert. ef. 8-2-04
EDD 6-2004(Temp), f. & cert. ef. 2-3-04 thru 8-1-04
EDD 6-2000, f. & cert. ef. 4-3-00

Or. Admin. R. 123-057-0910 Waiver of Nonstatutory Requirements

The Director or the Director’s designee may waive non-statutory requirements of this division of administrative rules, if demonstrated that such a waiver serves to further the goals and objectives of ORS 285B.230 to 285B.269, and that it contributes to sound economic or community development. The burden of proof in justifying such a waiver shall be on the Region seeking the waiver.

History

Statutory/Other Authority: ORS 285A.075(5), 285A.110, 285B.236(1), 285B.254(3) & 285B.263(2)
Statutes/Other Implemented: ORS 285B.230 - 285B.269
EDD 6-2000, f. & cert. ef. 4-3-00

Division 61 REGIONAL INFRASTRUCTURE FUND

Or. Admin. R. 123-061-0010 Temporary rule language in effect until 01/08/2027. Purpose

These rules establish the criteria and process for selecting Projects to be funded by the Regional Infrastructure Fund. The Oregon Business Development Department administers the Regional Infrastructure Fund for the purpose of providing Grants and Loans to Local Governments and Tribes for infrastructure Projects including long-range planning, research and design.

History

Statutory/Other Authority: ORS 285A.075 & OL 2013 c.786 §3
Statutes/Other Implemented: ORS 285B.551 & OL 2013 c.786 §3
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16
OBDD 7-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-061-0020 Temporary rule language in effect until 01/08/2027. Definitions

The following terms have the following definitions, unless the context clearly indicates otherwise:

(1) “Department” means the Oregon Business Development Department established by ORS 285A.070.

(2) “Fund” means the Regional Infrastructure Fund.

(3) "Grant" means funds for an awarded Project that are not required to be repaid, if contract conditions are met.

(4) “Grant and Loan Review Committee” means a committee designated by the Department to review and score Grant and Loan applications.

(5) “Project” means any one or more of the following capital projects and supporting activities: (a) Construction, modification, replacement, repair, remodel, renovation or acquisition of a structure/material asset with a useful life of one year or longer; (b) include land acquisition or legal interest necessary for such physical improvements; (c) Incorporate installation of machinery, equipment, furnishings, or materials integral to the structure; (d) Encompass associated long-range planning, feasibility research, design, permitting, land-use and environmental studies, and financing activities directly tied to the project; or (e) Include utility systems, buildings, roads, broadband networks, levees, docks, trails, industrial, and community facilities.

(6) “Loan” means a non-revolving loan for an awarded Project. Loan funds are required to be repaid after Project completion.

(7) “Local government” means a city, county, district, other public corporation, commission, and authority or entity organized under state statute or city /county charter.

(8) “Region” and “Regional” means an economic development district in Oregon, created by the Economic Development Administration of the United States Department of Commerce, for which the Governor has appointed a Regional Solutions Advisory Committee.

(9) “Regional Priorities” means the priorities for economic and community development established by a Regionally-Based Planning Committee.

(10) “Regionally -Based Planning Committee” means a Regional Solutions Advisory Committees appointed by the Governor as described in Chapter 82 Oregon Laws 2014.

(11) “Request for Applications” means a document that provides information on the program; the schedule for the program’s funding cycle; funding allocation(s); eligibility of applicants or Projects; application information and requirements; the evaluation and selection process; and a sample contract.

(12) “Tribe” means a federally recognized Indian tribe in Oregon as defined by ORS 182.162.

History

Statutory/Other Authority: ORS 285A.075 & OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3, OL 2014 c.82 §2, OL 2014 c.82 §3 & OL 2014 c.82 §5
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16
OBDD 7-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-061-0030 Temporary rule language in effect until 01/08/2027. Project Applications

(1) The Department will develop an application to apply for Project funding and develop procedures for review and award. Applications will be received by the Department.

(2) The Department will issue a Request for Applications when it has available Program funds.

(3) Eligible applicants are Local Governments or Tribes.

(4) The Request for Applications will identify the following:

(a) The types of funds available and the eligible uses;

(b) Evaluation criteria;

(d) Funding terms and conditions.

(5) If a Project or applicant is deemed ineligible, the applicant will be notified by the Department. The Department’s eligibility decisions are final and may not be appealed.

History

Statutory/Other Authority: OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3, OL 2014 c.82 §2, OL 2014 c.82 §3 & OL 2014 c.82 §5
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16
OBDD 7-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-061-0031 Temporary rule language in effect until 01/08/2027. Project Criteria

Projects shall be evaluated on the following criteria:

(1) Whether the proposed Project addresses one or more Regional Priorities established by the Regionally-Based Planning Committees appointed to the Region where the proposed Project is sited.

(2) The extent to which the proposed Project meets the sustainable community objectives as noted in ORS 184.423(2).

(3) the extent to which the proposed Project is ready for implementation.

History

Statutory/Other Authority: OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3, OL 2014 c.82 §2, OL 2014 c.82 §3 & OL 2014 c.82 §5
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16

Or. Admin. R. 123-061-0032 Temporary rule language in effect until 01/08/2027. Public Involvement

(1) Applications that are timely submitted and complete, will be forwarded to the applicable Regionally-Based Planning Committee for review and recommendation of Projects from that respective Region.

(2) Regionally-Based Planning Committees will follow public meeting requirements specified within ORS 192.610-192.690.

History

Statutory/Other Authority: OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3, OL 2014 c.82 §2, OL 2014 c.82 §3 & OL 2014 c.82 §5
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16

Or. Admin. R. 123-061-0033 Temporary rule language in effect until 01/08/2027. Project Recommendations and Awards

(1) Regionally-Based Planning Committees will recommend Projects from their Region to the Grant and Loan Review Committee.

(2) The Department will establish a Grant and Loan Review Committee, which will review Project recommendations, and make Project award decisions.

(3) The Department will issue notices of intent to award.

History

Statutory/Other Authority: OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3, OL 2014 c.82 §2, OL 2014 c.82 §3 & OL 2014 c.82 §5
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16

Or. Admin. R. 123-061-0035 Temporary rule language in effect until 01/08/2027. Contracts

(1) Upon approval of an award from the Fund, the Department will enter into a binding contract with the Local Government or Tribe.

(2) The contract for a Grant and/or Loan shall be in a form provided by the Department and will include at a minimum:

(a) A provision that disbursements from the Fund will be according to the terms of the contract;

(b) The eligible use of funds;

(d) The repayment obligation of the Local Government or Tribe for breach of the contract.

(e) Other provisions that the Department considers necessary or appropriate to implement the Program.

(3) In the event of a contract default, any recovered funds will be returned to the Fund and may be awarded to another Project.

(4) A contract for a Loan must be authorized by an ordinance, order or resolution adopted by the governing body of the Local Government or Tribe in accordance with the Local Government’s or Tribe’s requirements for public notice and authorizing debt.

History

Statutory/Other Authority: ORS 285A.075 & OL 2013 c.786 §3
Statutes/Other Implemented: OL 2013 c.786 §3
OBDD 14-2026, temporary amend filed 07/14/2026, effective 07/14/2026 through 01/08/2027
OBDD 15-2016, f. & cert. ef. 12-22-16
OBDD 7-2014, f. 4-30-14, cert. ef. 5-1-14

Division 70 FIRST-SOURCE HIRING AGREEMENTS

Or. Admin. R. 123-070-1000 Purpose and Scope

(1) The purpose of this division of administrative rules is to implement ORS 461.740, under which business firms are required to enter into a First Source Agreement if benefiting from funds derived from the Oregon State Lottery through certain economic or community development programs, as determined by the Oregon Business Development Department.

(2) Provisions of this division of administrative rules also apply to businesses benefiting under the following tax incentive programs, as provided by the relevant statutes:

(a) The “Strategic Investment Program” under ORS 285C.600 to 285C.626 and 307.123, as specified in OAR 123-623; and

(b) The standard exemption in “enterprise zones” under ORS 285C.050 to 285C.250, as specified in OAR 123-674.

(3) Requiring Benefited Businesses to enter into a First Source Agreement is intended to help individuals, who are already receiving job training and assistance supported by public funds, by linking these individuals with private sector employment opportunities of businesses that:

(a) Will be hiring in association with the receipt of public benefits; and

(b) Should make a good faith effort to hire and retain such individuals, who are presumed to have low incomes or otherwise face disadvantages in finding employment.

(4) First Source Agreements and this division of administrative rules are not intended to do the following:

(a) Guarantee employment for any such individual;

(b) Dictate the actual hiring by a Benefited Business; or

(5) As used in ORS 461.740(1), “good faith effort to hire and retain as employees low-income individuals who have received job training assistance from publicly funded job training providers” means the Benefited Business will reasonably honor the terms of the First Source Agreement entered into with the Contact Agency for local Providers.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1), 285C.215(3) & 285C.615(7)
Statutes/Other Implemented: ORS 285C.060, 285C.175, 285C.215, 285C.606 & 461.740
OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2009, f. 2-23-09, cert. ef. 2-24-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0300
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Or. Admin. R. 123-070-1100 Definitions

For purposes of this division of administrative rules, in addition to definitions in OAR 123-001 (Procedural Rules), unless the context demands otherwise:

(1) Contact Agency means the entity that represents publicly funded job training providers. It shall designate a Contact Person charged with interacting with Benefited Businesses and other entities and with representing the Contact Agency on matters related to First Source Agreements.

(2) First Source Agreement means the contract between a Benefited Business and Providers, as executed by a Contact Agency, consistent with this division of administrative rules, and it has the same meaning as “first-source hiring agreement” under ORS 285C.050, 285C.606 and 461.740. It covers and is applicable to all of the Benefited Business’s hiring or job openings, except for those persons or positions that are:

(a) Hired solely to construct, renovate or install property;

(b) Excluded by a waiver in accordance with OAR 123-070-1500; or

(3) Interagency Agreement is the agreement entered into among Providers as specified in OAR 123-070-1200.

(4) Provider has the same meaning as “publicly funded job training provider,” as used in ORS 285C.050, 285C.606 and 461.740 and means one of the following:

(a) A local office of the Oregon Department of Human Services that delivers training or employment services for low-income parents, seniors, persons with disabilities and so forth;

(b) An administrative agent for programs under the federal Workforce Innovation and Opportunity Act ( WIOA ; Public Law 113–128; 29 U.S.C. 3101 et seq .) or amendments thereto;

(d) A government or government-supported entity, similar to those in subsections (a) to (c) of this section, that is directly or indirectly engaged in training or assisting people to perform or succeed in the workplace or in a particular occupation; or

(e) Any other entity that is a party to the Interagency Agreement as described in OAR 123-070-1200, but such inclusion is effective only insofar as the entity, including but not limited to a local office of this state’s Employment Department or Worksource Oregon, remains such a party or serves as the Contact Agency.

(5) Qualified Applicants means individuals who have received job training assistance and who meet the Benefited Business’s minimum requirements for education, experience, reliability and skills, or who are able to meet these requirements within a reasonable time period (as negotiated with the Benefited Business) with training provided either by the Benefited Business or by a Provider.

(6) As used in section (5) of this rule and OAR 123-070-1000, “received job training assistance” means the individual has received intake or other services from a Provider.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1), 285C.215(3) & 285C.615(7)
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.215, 285C.606 & 461.740
OBDD 14-2017, amend filed 11/30/2017, effective 11/30/2017
OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2009, f. 2-23-09, cert. ef. 2-24-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0310
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Or. Admin. R. 123-070-1150 Affected Businesses

For purposes of this division of administrative rules:

(1) A Benefited Business means any for-profit business firm (regardless of its form of ownership or organization) that benefits directly or substantially from a state lottery-funded program, as indicated below in this section:

(a) Any of the following programs, throughout this state, except as set forth in section (3) of this rule:

(A) Oregon Business Development Fund (ORS 285B.050 to 285B.098);

(B) Strategic Reserve Fund (ORS 285B.266); or

(b) Any program financed by state lottery funds and administered by the Department, as so determined by the Director, including but not limited to industry development activities under ORS 285B.280 to 285B.286.

(2) A Benefited Business also means either of the following, regardless if section (1) of this rule applies too:

(a) An “authorized business firm” as defined under ORS 285C.050(2) for an enterprise zone exemption on qualified property from ad valorem taxation under 285C.175; or

(b) A business firm approved to receive or receiving the partial exemption of property from ad valorem taxation as an eligible project of the Strategic Investment Program under ORS 285C.600 to 285C.626.

(3) Regardless of association with a program in subsection (1)(a) or (b) of this rule, a business firm is not a “Benefited Business” solely because it receives any of the following from the Department, a grantee or any other entity:

(a) A purchase order or contract to provide services;

(b) Funds strictly for marketing or research activities; or

(4) Benefits substantially from any program by way of loan or grant financed by state lottery funds” as used in ORS 461.740(4)(a) and section (1) of this rule means that the business firm:

(a) Receives benefits through infrastructure or facility improvements financed by an entity that is receiving state lottery-funded loan or grant assistance to immediately make such improvements; and

(b) Was given prior notice from the Department or the entity that the First Source Agreement was a condition for the facility or infrastructure improvements or modifications arising from lottery funds.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.615(7)
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.175, 285C.215, 285C.606 & 461.740
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2009, f. 2-23-09, cert. ef. 2-24-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Or. Admin. R. 123-070-1300 Administration for Lottery-Funded Projects

(1) For the lottery-funded programs listed in OAR 123-070-1150(1)(a), the Department shall take anticipatory actions that are necessary and appropriate to implement the requirement of the First Source Agreement in accordance with ORS 461.740, which may include but are not limited to requiring a Benefited Business to submit a copy of the First Source Agreement, or otherwise ensuring that one has been entered into, before the grant or loan is ultimately awarded.

(2) The responsibilities consistent with section (1) of this rule may be delegated by the Department to a grantee that is the direct recipient of lottery-derived funds and that provides the grant, loan or substantial benefits to the Benefited Business.

History

Statutory/Other Authority: ORS 285A.075 & 285A.110(1)
Statutes/Other Implemented: ORS 461.740
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0320
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Or. Admin. R. 123-070-1500 Waivers and Geographic Coverage of First Source Agreements

(1) Except in the case of the Strategic Investment Program, the Director may issue a waiver that does the following:

(a) Relieves a Benefited Business of the requirement of entering into the First Source Agreement, entirely; or

(b) Excludes professional, managerial, technical, highly skilled or seasonal positions of a Benefited Business from the First Source Agreement.

(2) The Director shall make the final decision to grant the waiver, upon written recommendation by staff that explains why:

(a) The Benefited Business’s small size or the technical, professional or unusual nature of its needs with respect to employees means that it will be unable to fill positions with persons referred by the Providers, either in general or for the excluded positions, and will thus receive little or no meaningful service through the First Source Agreement; or

(b) The waiver will further the goals or purposes of applicable and specified state policies, whether or not such policies are directly associated with the program.

(3) A Benefited Business may request a waiver by the Department under this rule at the time of application for the grant or loan assistance, or before execution of the contract for such assistance, in the case of lottery-funded programs, or at any time prior to qualifying for an enterprise zone exemption.

(4) Department staff will notify the Benefited Business and the Contact Agency for the geographic area in which the Benefited Business is located of the Director’s decision and send a copy of any approved waiver. Such notice and distribution shall also include other entities as described in OAR 123-674, as applicable for an enterprise zone exemption.

(5) Except for an enterprise zone exemption, the First Source Agreement entered into by a Benefited Business shall apply only to the Benefited Business’s operations at the site receiving the benefit, unless other locations are:

(a) Designated by the Department; or

(b) Specifically agreed to by the Benefited Business and the Contact Agency.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.215(3)
Statutes/Other Implemented: ORS 285C.060, 285C.215 & 461.740
OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0330
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
EDD 9-1991, f. 9-6-91, cert. ef. 9-9-91
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Or. Admin. R. 123-070-1600 Duration of First Source Agreements

For purposes of a First Source Agreement:

(1) The term of agreement shall begin on or before the first date of any new hiring activity associated with employees for the benefited investment of the Benefited Business.

(2) The term of agreement shall end, as follows:

(a) Under state lottery-funded programs listed in OAR 123-070-1150(1), no less than 18 months from the date that the Benefited Business begins to request referrals under the First Source Agreement, unless a longer period is specified in the body of the First Source Agreement.

(b) Under tax incentive programs listed in OAR 123-070-1150(2), when the property tax exemption period concludes, which shall occur:

(A) On December 31 of the final year of exemption; or

(B) Sooner, in cases where an enterprise zone authorization application or exemption claim is formally withdrawn, or the exemption is disqualified or terminated by the county assessor, and the Benefited Business either does not exercise or has exhausted its right to appeal the refusal, denial, disqualification or termination.

(3) Nothing shall hinder or prevent a Benefited Business and a Contact Agency from mutually continuing to function under the arrangements of a First Source Agreement, even though the agreement is no longer in force, as stipulated by this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.215, 285C.606 & 461.740
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Or. Admin. R. 123-070-1800 Local/Case-Specific Modifications to the First Source Agreement

For purposes of OAR 123-070-1700, the First Source Agreement may be modified or amended as follows, as long as such modification or amendment does not alter or nullify the clear expression or the intent of any provision in OAR 123-070-1700(1):

(1) The Contact Agency or the Providers under the Interagency Agreement covering the geographic area in which the Benefited Business is located may add other substantive provisions or components to the First Source Agreement, but only through and pursuant to mutual consent by the Benefited Business, unless otherwise allowed in sections (2) or (3) of this rule or for data reporting as described in OAR 123-070-1900(4) and (5).

(2) As initiated or agreed to by the Contact Agency and Providers, a locally developed model First Source Agreement may include provisions that are conditions for receiving local administered incentives that are in addition to state lottery or property tax benefits. Such conditions do not, however, affect the benefits of programs listed in OAR 123-070-1150(1) or (2).

(3) With the consent and approval of the sponsor of an urban enterprise zone, the Contact Agency may add local conditions that are derived directly from the policy adopted by the sponsor under ORS 285C.150 to the regular format of the First Source Agreement that is used for the Benefited Businesses in that zone, and such additional provisions of the First Source Agreement shall be conditions for the enterprise zone property tax exemption consistent with the standards in the zone sponsor's policy.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.105, 285C.215, 285C.606 & 461.740
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Or. Admin. R. 123-070-1900 Data Collection

(1) For purposes of OAR 123-070-1200(3)(e) and 123-070-1700(1)(e), the Contact Agency may collect and compile data by Benefited Business and by referring agency (Provider), and may specify in the First Source Agreement a schedule and method by which a Benefited Business submits or confirms data, for the following items:

(a) The Benefited Business's name, address and State Business Identification Number (BIN/unemployment insurance account number);

(b) The number and names of all persons referred to each Benefited Business through a First Source Agreement with the Contact Agency;

(d) The total number of individuals hired by each Benefited Business; or

(e) A consolidated list of applicable job openings, whether filled or unfilled, even if vacated or refilled.

(2) Any data collection under this rule shall be performed no more frequently than as follows, and then only for data specific to the intervening period in question and not previously collected:

(a) For Benefited Businesses as described in OAR 123-070-1150(1) (lottery-funded programs), the data may be collected for the following quarters: January 1 through March 31, April 1 through June 30, July 1 through September 30 and October 1 through December 31.

(b) For Benefited Businesses as described in OAR 123-070-1150(2) (tax incentive programs), the data may be collected on an annual basis, subject to modification under section (3) of this rule, for each calendar year until the end of the property tax exemption period.

(3) If a Benefited Business is receiving benefits under a program pursuant to both subsections (2)(a) and (b) of this rule, the data for the Benefited Business may be collected in the manner specified in subsection (2)(a) of this rule during the period in which the First Source Agreement is in effect for the lottery-funded benefits, with an annual compilation for every December 31. After such period, data collection may take place only as indicated in subsection (2)(b) of this rule.

(4) For Benefited Businesses as described in OAR 123-070-1150(2), the county under ORS 285C.609 or the enterprise zone sponsor may seek the Contact Agency's assistance as described in subsection (5) of this rule for the following:

(a) A Strategic Investment Program agreement under ORS 285C.609;

(b) An urban enterprise zone in which the sponsor has adopted a policy under ORS 285C.150 (irrespective of a regularly formatted First Source Agreement as provided in OAR 123-070-1800);

(d) A written agreement for an extended period of enterprise zone abatement up to five years under ORS 285C.160.

(5) For the purposes of section (4) of this rule and this section, the zone sponsor or the county:

(a) Shall take appropriate and necessary actions to compensate the Contact Agency or Providers for any expenses that arise, and to safeguard the confidentiality of data submitted or compiled with respect to legal constraints affecting the Contact Agency or any Provider;

(b) May make the Benefited Business's submission of data specified in paragraph (c)(A) of this section a condition for the tax incentive benefit, if so provided in the policy or agreements under section (4) of this rule; and

(A) That the First Source Agreement specify particular types and formats of data that the Benefited Business must provide, either to demonstrate compliance with requirements under ORS 285C.150, 285C.155, 285C.160, 285C.205 or 285C.609(5) or to satisfy other information needs of the sponsor or the county related to the Benefited Business's hiring, employment, training, compensation and so forth, insofar as it is practical, and as such data or information reasonably relates to the First Source Agreement; and

(B) To have such data transmitted through the Contact Agency. (No such data is to come from any other information source to which a Provider has access, including but not limited to unemployment insurance data.)

(6) For Benefited Businesses under the state lottery-funded programs listed in OAR 123-070-1150(1), the Contact Agency may provide appropriate compilations of data collected under this rule to the Department, as requested by the Director.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.105, 285C.150, 285C.155, 285C.160, 285C.606, 285C.609 & 461.740
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0360
EDD 9-1996, f. 10-8-96, cert. ef. 10-11-96
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
Reverted to EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 3-1992(Temp), f. 3-12-92, cert. ef. 3-13-92
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Division 76 Rural Opportunity Initiative Grant Program

Or. Admin. R. 123-076-0000 Purpose and Objectives

The Oregon Business Development Department (“Department”) administers the Rural Opportunity Initiative Grant Program (“Program”) under authority provided by ORS 285A.227. Under the Program, and consistent with these rules, the Department will award grants to support entrepreneurs and small business growth in Rural Areas through development of their Entrepreneurial Ecosystems (“Projects”).

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0010 Definitions

For the purposes of these rules, additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, the following terms shall have the following meaning, unless the context clearly indicates otherwise:

(1) “Economic Development District” has the meaning given that term in ORS 285B.636.

(2) “Eligible Projects” are projects that work to support one or more of the components listed in 123-076-0010(3)(a)-(h) .

(3) “Entrepreneurial Ecosystem” means a collaborative network of people, organizations and institutions who interact to convene, connect, and deploy resources within a given geography. The strength of the entrepreneurial ecosystem correlates with the degree to which its components are interconnected and support business growth. Commonly recognized components of an Entrepreneurial Ecosystem include:

(a) Financial capital (the capital and lending options available to business);

(b) Business support (the individuals, institutions and organization that help businesses start and grow);

(d) Markets (the consumers interested in a defined set of products and services);

(e) Human capital (skilled workforce);

(f) Infrastructure (physical spaces, institutions and online resources that help entrepreneurs connect with each other);

(g) Research and Development; and

(h) Culture (a thriving entrepreneurial ecosystem culture is characterized by inclusivity, trust and collaboration that allows entrepreneurs to quickly find what they need at each stage of growth).

(4) “Lead Applicant” means an entity that submits an application for a Program award to complete a Project. Lead Applicants must satisfy the requirements set forth in OAR 123-076-0050. After receiving a Program award, Lead Applicants will be referred to as a “Recipient.”

(5) “Rural Area” has the meaning given that term in OAR 123-001-0050.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0020 Request for Applications

The Department will issue a Request for Grant Applications (“RFGA”) prior to awarding any grants under the Program. In compliance with these rules, the RFGA will set out the process for Lead Applicants to submit an application for Program grants and the process the Department will use to evaluate applications and make funding decisions.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0030 Application Requirements

(1) In order to receive a Program grant, a Lead Applicant must submit an application that:

(a) Is in the form required by the Department;

(b) Contains or is accompanied by such information and documentation as the Department requires in the RFGA;

(c) Contains a workplan that identifies the scope of work to be completed with Program funds and Project goals and metrics to be used to evaluate the Project’s success;

(d) Demonstrates that the proposed Project activities will improve the Entrepreneurial Ecosystem for the Rural Area in Oregon which the Lead Applicant resides; and

(e) Contains a Project budget.

(2) Applications that do not include all required elements shall be determined to be nonresponsive and will be ineligible for a Program grant.

(3) Satisfaction of the above requirements does not guarantee that an application will receive a Program award.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0040 Application Review

(1) Applications will be evaluated by a grant review committee consisting of Department staff. The committee may also include community partners or other outside advisors invited by the Department. The committee will provide the Department with funding recommendations based on criteria set forth in these rules and the RFGA. The Department retains all funding award authority.

(2) The committee will evaluate applications using an award rubric that results in a numeric rating for each of the following categories and any additional categories set out in the RFGA:

(a) Reasonableness of budget and justification and alignment of budget with proposed activities;

(b) Quality of Project goals and metrics to evaluate the Project’s success;

(c) Experience and capacity of Lead Applicant and key individuals involved in the proposed Project to facilitate Entrepreneurial Ecosystem building; and

(d) Evidence of stakeholder support.

(3) After the committee completes the evaluation process, applications may be prioritized based on the committee’s scoring and any other factors set forth in the RFGA to make award recommendations.

(4) The committee will make its recommendations to the Program manager for final award decisions.

(5) The Department will provide a notice of intent to award to Lead Applicants that are selected for an award.

(6) The notice of intent to award shall contain an offer of an amount for a grant and may contain conditions that the Recipient must satisfy prior to receiving a contract or grant funds. The Department may make an offer that is less than what was requested by the Lead Applicant.

(7) If a contract has not been fully executed by all parties with 30 days of Recipient receiving contract documents, the Department may rescind its notice of intent to award and reallocate Program funds.

(8) The Department will notify unsuccessful Lead Applicants.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0050 Eligible Lead Applicants

(1) Lead Applicants must apply on behalf of three or more entities (including the Lead Applicant) that will serve as partners in completing the proposed Project.

(2) Lead Applicants must be located in a Rural Area and be one of the following types of entities:

(a) Federally recognized Indian tribe in Oregon;

(b) Nonprofit entity organized under Section 501(c)(3) or 501(c)(6) of the U.S. Internal Revenue Code, that are registered with the Oregon Secretary of State;

(3) Educational institutions, as defined in ORS 702.005, may not serve as a Lead Applicant but may serve as an entity participating in the Project.

(4) Lead Applicants will be responsible for receiving, managing, and reporting on Project activities and expenditures.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0060 Eligible Projects and Project Costs

(1) Eligible Projects are Projects that are designed to improve the Entrepreneurial Ecosystem to support rural entrepreneurs and small businesses.

(2) Eligible Project costs include the necessary and reasonable costs, as determined by the Department, to carry out the Project.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0070 Grant Contracts and Disbursement of Funds

(1) The Department shall not disburse grant funds until the Department has executed a legally binding contract with the Recipient.

(2) The contract will be in a form provided by the Department and shall contain terms and conditions the Department considers beneficial for the prudent and efficient administration of the Program, including compliance with all applicable laws and regulations.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Or. Admin. R. 123-076-0080 Recipient Responsibilities

Program Recipients will be responsible for the prudent administration and completion of the Project, shall comply with all terms set forth in the contract, and shall maintain accounts and records for all activities associated with their respective Project for a period of no less than six years after Project completion and shall provide the Department reasonable access to such records upon request. Recipients shall submit periodic reports on the Project as requested by the Department or specified in the RFGA or contract.

History

Statutory/Other Authority: ORS 285A.227
Statutes/Other Implemented: ORS 285A.227
OBDD 6-2025, adopt filed 06/25/2025, effective 06/25/2025

Division 80 OREGON COMMUNITY DEVELOPMENT BLOCK GRANT (OCDBG) PROGRAM

Or. Admin. R. 123-080-0000 Purpose

The Oregon Business Development Department (Department) through its Infrastructure Finance Authortiy (Authority) shall administer the state's participation in the federal Community Development Block Grant funding program authorized by 42 United States Code 5301 et. seq.

(2) Oregon Community Development Block Grants (OCDBG) are funded by annual allocations to the state from the U.S. Department of Housing and Urban Development (HUD) and program income generated by the grants. The primary objective of the federal community development block grant program is "...the development of viable urban communities, by providing decent housing and a suitable living environment and expanding economic opportunities, principally for persons of low and moderate income..." (Title I, Sec. 101(c), Housing and Community Development Act of 1974, as amended (42 United States Code 5301 et seq.)). The primary objective of Oregon's Community Development Block Grant program is to enhance the quality of life in Oregon communities.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075
EDD 27-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 3-2001, f. & cert. ef. 4-10-01
EDD 12-1999, f. & cert. ef. 10-11-99
EDD 2-1994, f. & cert. ef. 2-3-94
EDD 5-1991, f. & cert. ef. 5-24-91
IRD 8-1986, f. 6-30-86, ef. 7-1-86, Renumbered from 120-021-0000
IRD 2-1986(Temp), f. & ef. 1-14-86

Or. Admin. R. 123-080-0010 Definitions

(1) "Act": The Housing and Community Development Act of 1974, as amended.

(2) "Applicant": A city or county which is applying for a grant from the OCDBG program.

(3) "Entitlement jurisdictions": Metropolitan cities and urban counties, as defined in 42 United States Code 5302.

(4) "Non-entitlement Area": All Oregon cities and counties, not including Indian Tribes, except those designated as entitlement jurisdictions by HUD.

(5) "Recipient": A city or county which has been awarded a Community Development Block Grant.

(6) "Slums and Blight": As defined in ORS 457.010 and 24 Code of Federal Regulations (CFR) 24 CFR 570.483(c).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075
EDD 27-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 12-1999, f. & cert. ef. 10-11-99
ED 1-1995, f. 1-31-95, cert. ef. 2-1-95
EDD 2-1994, f. & cert. ef. 2-3-94
EDD 3-1993, f. & cert. ef. 3-30-93
EDD 5-1991, f. & cert. ef. 5-24-91
IRD 8-1986, f. 6-30-86, ef. 7-1-86, Renumbered from 120-021-0002
IRD 2-1986(Temp), f. & ef. 1-14-86

Or. Admin. R. 123-080-0020 Eligible Applicants and Activities

(1) All cities and counties in non-entitlement areas of Oregon are eligible to apply for Community Development Block Grants except those determined to be ineligible by the Department because of nonperformance under a prior Community Development Block Grant contract.

(2) Eligible activities are listed in section 105(a) of title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.) and further defined in 24 CFR Part 570.482.

History

Statutory/Other Authority: ORS 285A.075 & 285A.110
Statutes/Other Implemented: ORS 285A.075
EDD 3-2001, f. & cert. ef. 4-10-01
EDD 12-1999, f. & cert. ef. 10-11-99
EDD 5-1991, f. & cert. ef. 5-24-91
IRD 8-1986, f. 6-30-86, ef. 7-1-86, Renumbered from 120-021-0005
IRD 2-1986(Temp), f. & ef. 1-14-86

Or. Admin. R. 123-080-0030 Program Information

(1) The Authority shall prepare an Application Package each year. The Application Package shall contain the method of distribution, application forms, and other supplementary information that may help eligible applicants prepare grant applications.

(2) The method of distribution shall include a description of all criteria used to select applications from local governments for funding, including the relative importance of the criteria (if developed), a description of how all Community Development Block Grant resources will be allocated among all funding categories and the threshold factors and grant size limits that will be applied. The method of distribution shall be adopted each year after public review and comment of the Annual Update to the State of Oregon Consolidated Plan for Housing and Community Development.

(3) The adopted method of distribution section of the Annual Update to the State of Oregon Consolidated Plan for Housing and Community Development on file with the Department is incorporated as part of these rules by reference.

(4) The Authority shall prepare and provide to Community Development Block Grant recipients a Grant Management Handbook which specifies requirements for local grant management, reporting, and record keeping, and the Authority’s monitoring and grant closeout procedures.

(5) The Authority shall administer Community Development Block Grants in compliance with the requirements of the Act, as amended, applicable rules, the method of distribution, and the Grant Management Handbook.

(6) Land Use Coordination: Any project activity paid for with Community Development Block Grant funds that affects land use shall comply with the applicable requirements of OAR chapter 123, division 8.

(7) Procurement by Recipients: When procuring property or services to be paid for in whole or in part with Community Development Block Grant funds, the recipient shall comply with Chapters 244 and 279 of the Oregon Revised Statutes, as applicable.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.075
EDD 27-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 3-2002, f. & cert. ef. 2-22-02
EDD 3-2001, f. & cert. ef. 4-10-01
EDD 12-1999, f. & cert. ef. 10-11-99
EDD 13-1998, f. & cert. ef. 8-14-98
EDD 3-1997, f. & cert. ef. 3-17-97
EDD 4-1996, f. & cert. ef. 5-28-96
EDD 1-1995, f. 1-31-95, cert. ef. 2-1-95
EDD 12-1994, f. & cert. ef. 9-8-94
EDD 2-1994, f. & cert. ef. 2-3-94
EDD 8-1993, f. & cert. ef. 9-21-93
EDD 3-1993, f. & cert. ef. 3-30-93
EDD 8-1992, f. & cert. ef. 4-24-92
EDD 5-1991, f. & cert. ef. 5-24-91
IRD 8-1986, f. 6-30-86, ef. 7-1-86, Renumbered from 120-021-0010
IRD 2-1986(Temp), f. & ef. 1-14-86

Or. Admin. R. 123-080-0040 Program Remedies

The recipient shall be responsible for taking all action necessary to enforce the terms of the grant contract against any private or public participant who fails to comply with applicable provisions of the grant contract, and to recover on behalf of the state any financial liabilities that may arise as the result of the breach of the grant contract by any participant. Nothing in this paragraph shall restrict the state's rights to enforce independently the terms of any grant contract or to recover any sums that may become due as the result of a breach of such a contract.

History

Statutory/Other Authority: ORS 184.125(3) & 190
Statutes/Other Implemented: ORS 285A.300 - 285A.312
EDD 27-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 5-1991, f. & cert. ef. 5-24-91
IRD 8-1986, f. 6-30-86, ef. 7-1-86, Renumbered from 120-021-0015
IRD 2-1986(Temp), f. & ef. 1-14-86

Division 84 OUTDOOR GEAR AND APPAREL MATCHING GRANTS

Or. Admin. R. 123-084-0010 Purpose

The Oregon Business Development Department (“Department” or “Business Oregon”), pursuant to Oregon Laws 2023, chapter 546, section 5, shall develop and administer an Outdoor Gear and Apparel Matching Grant Program (“Program”) to provide financial assistance to one or more Membership Organizations and Business Accelerators that support emerging outdoor gear and apparel companies with capacity building and technical assistance in the outdoor gear and apparel industry.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0020 Definitions

(1) “Business Accelerator” means a company:

(a) Operating principally in this state;

(b) With demonstrated success in operating educational programs in which outdoor gear and apparel industry veterans mentor cohorts of founders of emerging outdoor gear and apparel industry companies located in this state; and

(2) “Cash Match” means moneys expended by the Program applicant, not covered by Grant funding, that are reasonable, necessary and directly related to the Program Project.

(3) “In-kind Match” means the value of time, services, equipment or any other portion of the Project costs not covered by Program Grant funding or Cash Match provisions that are reasonable, necessary, and directly related to the Program Project. In-kind Match includes the value of volunteer work provided.

(4) “Lead Organization” means the entity that is the applicant for one or more businesses, nonprofit organizations, Membership Organizations, or Business Accelerators.

(5) “Membership Organization” means a nonprofit organization:

(a) Operating principally in this state;

(b) Consisting of member businesses from the outdoor gear and apparel industry whose principal place of business is in this state; and

(6) “Outdoor gear and apparel industry” means all traded sector businesses that manufacture gear and apparel for use in outdoor recreation.

(7) “Outdoor Recreation” means activities undertaken for pleasure outdoors in natural environments.

(8) “Traded sector” has the meaning given that term in ORS 285B.280.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-5
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0030 Matching Grant Fund Requirements

(1) To be eligible for an Outdoor Gear and Apparel Matching Grant Program award, all applying Membership Organizations and Business Accelerators will be required to contribute a minimum of 10 percent of the costs of a proposed eligible project (“Match”). The Match must be provided after the Grant Award decision.

(2) The 10 percent Match requirement must be fulfilled by a Cash Match. Any other portion of the Match may be a combination of Cash Match or In-kind Match. A Cash Match or an In-kind Match may be provided by the Applicant or other individual(s) or organization(s) but may not be provided by the State.

(3) In evaluating Program applications, the Department will give a preference to Applications that propose to contribute a 100 percent match (1:1 match).

(4) Full details regarding Match requirements will be contained in the Program request for grant applications (RFGA).

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0040 Eligibility and Application Submittal Process

(1) The following are eligible to apply for an Outdoor Gear and Apparel Matching Grant Program award: all Membership Organizations and Business Accelerators. If more than one eligible entity apply together, the application shall designate a Lead Organization.

(2) Grant Application Process: The Outdoor Gear and Apparel Matching Grant Program Funds will be subject to a competitive application process determined by the Department and detailed in an RFGA. The Department shall develop an RFGA for each grant cycle, which will be offered only as funding is available.

(3) Program RFGAs may supplement these Program rules, including providing additional submission requirements, deadlines, evaluation criteria, and selection and award process details.

(4) Grant applicants shall submit the following:

(a) A signed and completed application form provided by the Department;

(b) A Project description with activities described;

(d) Narrative describing demonstrated need and anticipated Project outcomes;

(e) Project implementation plan with timeline;

(f) A line-item budget with an accompanying narrative justifying the basis for each line-item (the budget should clearly link to activities described in the Project description);

(g) Resumes of key individuals overseeing and leading the Project;

(h) Letters of commitment (not letters of support) for any key collaborators that details their anticipated Project involvement, to include matching dollars support or program/service delivery, etc.;

(i) Additional miscellaneous supporting documentation as needed; and

(j) Additional requirements described in the RFGA.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: OR Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0050 Grant Evaluation, Review and Approval

(1) Business Oregon will announce deadlines for submitting Program applications and provide the detailed evaluation criteria in the RFGA.

(2) The grant applications will be evaluated based on the following general criteria:

(a) Completeness of the application;

(b) Quality of the Project Description;

(c) Reasonableness of the Project budget and justifications and alignment of the budget with proposed Project activities;

(d) Quality of metrics and targets for the Project;

(e) Experience and capacity of Lead Organization and key individuals to facilitate capacity building and technical assistance in the outdoor gear and apparel industry;

(f) Experience of partners and level of partner commitments to the Project; and

(g) Any other criteria to be detailed in the request for grant applications.

(3) Upon receipt of a completed application, Business Oregon will review the application for completeness and eligibility.

(4) Complete applications submitted by eligible applicants will be evaluated by a grant review committee consisting of Business Oregon staff and community partners. The committee may include outside advisors selected by Business Oregon staff to assist with making recommendations. The committee will utilize the Program evaluation criteria to review and score applications to recommend those that best meet the Program’s objectives. The committee will provide its recommendation to the Department who will make final decisions and approve any award(s). Meeting the eligibility requirements and submitting a complete application does not guarantee a Program grant award.

(5) Business Oregon may request additional information before making an award.

(6) Successful applicants will receive a Notice of Intent to Award from the Department.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0060 Notice of Intent to Award

(1) After review and evaluation of applications, Business Oregon will select awardee(s) and issue a Notice of Intent to Award that will include the amount of the conditional award to recipient organization(s).

(2) Awards will be contingent upon the development and execution of a grant agreement that includes a mutually agreeable scope of work, budget, and performance metrics and targets tailored to the Project.

(3) Business Oregon reserves the right to make funding awards for less than the amount requested by an applicant.

(4) Business Oregon also reserves the right to adjust the amount of funding noticed and negotiate modifications to the applicant’s proposed project and budget prior to the execution of a grant agreement and related legal documents for the award.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0065 Grant Agreement

(1) After approval of an application for a Program grant and Notice of Intent to Award, the Department will begin preparation of a binding Grant Agreement between the Department and the applicant or applicable Lead Organization for the application.

(2) Agreements for Program Grants:

(a) Shall have a required completion date and a deadline to request and disburse Program funds.

(b) Shall incorporate the Grant award amount.

(c) Shall provide that Grant funds may be used to pay only Project costs for the purposes of capacity building and technical assistance in the outdoor gear and apparel industry, as further detailed in the Grant Agreement.

(d) Shall set forth the process that will be used to disburse Grant funds to the Grant Recipient as an advanced payment of 30% of the Program award amount followed by two equal disbursements of 35% of the award amount. The Department will make the second and third disbursements only after the recipient provides adequate documentation (in a format satisfactory to the Department) both that they’ve made appropriate progress on Project metrics and expenditures of at least 80% of the first and second Program disbursements respectively.

(e) Shall provide a Project description with activities described, a schedule for key milestones and activities, and other goals to be met by the Recipient.

(f) Shall incorporate a Project Budget, detailing both Grant funds and Match budgets. Pre-award costs are not eligible for Grant funding or Match contribution calculation unless expressly authorized by Business Oregon in the Grant Agreement, in its sole discretion.

(g) Shall incorporate Project programmatic and financial reporting requirements (see OAR 123-086-0070) and other documentation that the Grant Agreement Recipient shall submit throughout the term of the Grant Agreement.

(h) Shall require compliance with applicable local, state and federal laws.

(i) Shall provide for remedies in the event of a breach or default of the Grant Agreement.

(j) Shall contain such other terms and conditions as the Department requires.

(3) Grant Agreements may be subject to review and approval by the Oregon Department of Justice for legal sufficiency as required by ORS 291.047. Applicants will not receive Grant funds until all required documents have been submitted and deemed satisfactory by Business Oregon and a Grant Agreement is fully executed.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0070 Reporting Requirements

(1) Every Grant Recipient that enters into a Grant Agreement with the Department shall be required to report on Project activities, Project expenditures, Project milestones completed, overall outcomes and any other information required by the Department, on forms or in a format prescribed by the Department. The time periods to be covered in each report and the deadlines for report submission shall be determined by the Department on a case-by-case basis depending upon the nature of the Project activities.

(2) The reporting obligations provided in section (1) cease on the earlier of the date the Agreement expires, the date the Agreement is terminated, or the date the Department has determined that the Grant Recipient has met their contractual obligations.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Or. Admin. R. 123-084-0080 Records and Data Confidentiality

(1) Data or information regarding an entity or Project in Grant Agreements, applications, reports, or related materials or communications provided to the Department will be public records subject to disclosure, except for information that qualifies as a public records exemption under ORS 192.311 to 192.478 (Oregon Public Records Law).

(2) When submitting materials to the Department, it is the applicable company or organization’s responsibility to mark material believed exempt from disclosure under Oregon Public Records Law. To designate a portion of materials as exempt from disclosure under the Oregon Public Records Law, the company or organization shall: (a) Clearly identify in the body of the submission only the limited material that is believed to be a trade secret or would otherwise be exempt under public records law; (b) Identity the public records law exemption(s) that is believed to apply; and (c) Provide a justification for how each portion designated as exempt meets the criteria under the public records law.

(3) Upon an applicable Public Records Law request, the Department shall determine whether any materials are exempt from disclosure and will redact from disclosure only that data or information.

(4) Companies and organizations are advised to consult with their legal counsel regarding disclosure issues. They may wish to limit the amount of trade secret information or other data or information submitted, providing only what is necessary to submit a complete and competitive application or comply with legal requirements.

History

Statutory/Other Authority: ORS 285A.075 & 2023 Or. Laws, chapter 546, section 5(3)(c)
Statutes/Other Implemented: Or. Laws 2023, Ch.546, Sections 3-6
OBDD 17-2024, adopt filed 07/15/2024, effective 07/15/2024
OBDD 9-2024, temporary adopt filed 05/06/2024, effective 05/06/2024 through 11/01/2024

Division 87 PRIVATE SECTOR CONTRIBUTIONS AND INVOLVEMENT

Or. Admin. R. 123-087-0000 Purpose

This division of administrative rules sets forth guidelines for soliciting, accepting and reporting contributions to the Department projects, programs and purposes that are received from private, non-governmental sources, as permissible under state law, including but not limited to ORS 285B.200(1). These guidelines are based on the premise that building a stronger economy and vital communities in Oregon may necessitate and may sometimes be best accomplished by close collaboration among the public, nonprofit and private sectors.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.200
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 35-1988, f. 11-30-88, cert. ef. 12-1-88

Or. Admin. R. 123-087-0010 Definitions

(1) For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division of administrative rules, unless the context requires otherwise the following definitions apply:

(2) Private Sector Support means financial contributions and/or in-kind goods and services, such as those listed in OAR 123-087-0020(1), that are received by the Department. Such donations may be received from individuals, partnerships, or corporations, or any other private entity, including but not limited to nonprofit organizations.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.200
EDD 28-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 35-1988, f. 11-30-88, cert. ef. 12-1-88

Or. Admin. R. 123-087-0020 Solicitation and Use of Private Support

(1) The Department may solicit, receive and use Private Sector Support in the following contexts:

(a) Special projects for public information, publicity or promotional activities related to economic and community enhancement in this state;

(b) Employees who are hired by the state government but whose compensation is entirely or partially attributable to donations received by the Department or by the state government on the Department’s behalf from one or more private entities;

(c) Personnel employed by the contributing entity who are loaned to the Department for performing certain purposes, and who receive no compensation from the Department except for reimbursement of expenses;

(d) Activities related to the expansion, retention or recruitment of businesses, employment or commerce in and for this state;

(e) Efforts to organize, educate or increase institutional or human capacity for and among persons engaged in local economic and community development;

(f) Free or discounted provision of or access to public speakers, expertise, printing, advertisement, transportation, accommodations and so forth; or

(g) Similar reasons and circumstances.

(2) Solicitation of Private Sector Support by the Department shall be approved by the Director.

(3) Contributors to the Department shall not receive any special benefit, service, consideration, publicity or information as a result of their contribution to the Department, other than, for example, satisfaction with the mutual outcomes accomplished as a result of collaboration with the Department.

(4) Any Private Sector Support received in the form of money shall be paid into and disbursed from an appropriate account or fund and its origins recorded.

(5) Private Sector Support shall be used only for the purposes for which it was contributed or returned to the contributor when appropriate.

(6) Private Sector Support involving loaned personnel, privately supported compensation of state employees or similar arrangements shall be:

(a) Used only for temporary, limited duration or specially dedicated roles or for unusual circumstances, and not to fill a regular, permanent position of the state government or to displace or replace any existing employee;

(b) Approved directly by the Director;

(c) Reported to appropriate state agencies, in addition to OAR 123-087-0040, within 30 days of the commencement of such a person’s work or service for the state, if the period of that work or service is expected to be at least that long;

(d) For no more than an overall period of two years and not repeated;

(e) Preceded by any affected person’s orientation with the Department, including but not limited to facilitation and instruction by the Department for the person to read and understand the laws and guidelines described in subsection (f) of this section; and

(f) Done in accordance with all applicable laws and guidelines of the State of Oregon and of the Department relating to personnel, compensation, volunteers, state liability, ethics, and the identification and prevention of conflicts of interest, including but not limited to ORS 171.725 to 171.785, ORS Chapters 179 and 244, and OAR 123-087-0030.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.200
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 35-1988, f. 11-30-88, cert. ef. 12-1-88

Or. Admin. R. 123-087-0030 Avoiding Conflicts of Interest

(1) The Department shall solicit and receive Private Sector Support only for the purpose of assisting the Department to undertake or implement the programs, functions or laws that it is charged with administering.

(2) Private Sector Support may not be received or used in any way that:

(a) Provides for the personal benefit of any state employee;

(b) Directly benefits any entity responsible for the support; or

(c) Pertains significantly to Department actions, decisions or resources with the potential to have a pecuniary advantage or detriment to such an entity.

(3) If, in the judgment of the Director, an entity is offering or providing support in order to potentially receive special consideration, services or information from the state, or the support is otherwise improper, the Director shall refuse or return the support offered. The Director may consult with the Governor's Office, Department of Administrative Services, Secretary of State, Attorney General, the Oregon Government Ethics Commissionor other state agencies in order to determine whether receipt of such support is appropriate.

(4) The Department shall, as needed, develop special operational guidelines for purposes of this division of administrative rules (including but not limited to the treatment of confidential or privileged information), signed statements acknowledging such guidelines, and so forth.

(5) The elements and intent of this rule may be applied in situations that might arise with respect to contributions, in-kind goods or services or other forms of support offered to or received by the Department from local governments or municipal corporations that are eligible to receive funding from the Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.200
EDD 28-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 4-2003, f. & cert. ef. 3-26-03
EDD 35-1988, f. 11-30-88, cert. ef. 12-1-88

Division 88 UNIVERSITY INNOVATION RESEARCH FUND

Or. Admin. R. 123-088-0010 Purpose

The University Innovation Research Fund was established by the Oregon Legislature in 2019 through HB 2377. The purpose of this division of rules is to document the process and criteria by which this fund will be used to support innovation and commercialization of technology that has a direct or potential connection to economic development from Oregon’s public universities and Oregon Health & Science University (OHSU).

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0020 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) “Council” means the Oregon Innovation Council.

(2) “Department” means the Oregon Business Development Department

(3) “Fund” means the University Innovation Research Fund.

(4) “Review Committee” is the group that does the initial evaluation of requests for matching commitments from the University Innovation Research Fund. The Review Committee shall consist of the sitting members of the Senior Research Officers Council (SROC) or their designees and one representative from the Council or their designee who does not represent an educational institution.

(5) “SRO” means the Senior Research Officer.

(6) “SROC” means the Senior Research Officer Council, which consists of the SRO from each public university in Oregon (Oregon State University, University of Oregon, Portland State University, Oregon Institute of Technology, Southern Oregon University Western Oregon University and Eastern Oregon University) and OHSU.

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 8-2025, amend filed 11/21/2025, effective 11/21/2025
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0030 Qualifying Universities

All public universities in Oregon as established in ORS 352.002 and OHSU are eligible to request access to the fund. That is, Eastern Oregon University, Portland State University, Oregon State University, Oregon Institute of Technology, Southern Oregon University, University of Oregon, Western Oregon University and OHSU are eligible. Hereafter, all of these institutions are collectively referred to as the universities.

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019, HB 2377 (2019) & ORS 352.002
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0040 Eligible and Ineligible Uses of the Fund

(1) As determined by the Department, match funding may be used to support projects proposed under a federal proposal that will support innovation or commercialization of technology at the applicant university that has a direct or potential connection to economic development. The Fund may be accessed to provide matching funds for federal proposals submitted by a qualifying university that have a required or non-required financial match although required match is preferred. If match funding is not required under a federal proposal, applicants requesting Fund monies shall substantiate that the requested funding provides a strategic competitive advantage for the proposal. Applicants will be required to indicate if non-federal cash match or cost-share is required or, if match is not required, how applicant contributions are described in the federal funding opportunity. Exceptions will be made for non-required match proposals, under the guidance of the Review Committee, who will evaluate the timing of the proposal, the potential economic development impact and the remaining balance of the UIRF fund at the time that the proposal is made.

(2) Requests for match funding are expected to be for no less than $250,000 in UIRF funds with total federal budgets of no less than $2M. When possible, universities are encouraged to pursue collaborative, multi-university proposals will be given a higher priority in the review process.

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 8-2025, amend filed 11/21/2025, effective 11/21/2025
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0050 Review Committee

(1) The Review Committee shall consist of (seven) members of the Senior Research Officers Council (SROC) or their designees and (one) representative from the Council or their designee who does not represent an educational institution. The representative from the Council or their designee will serve as Chair of the Review Committee and is designated to relay UIRF status and funding decisions to the Council during quarterly meetings. A Department representative shall provide staff support to the Review Committee but will not participate in Review Committee decision making and is not part of the committee quorum.

(2) The Review Committee may have a standing meeting each month to review requests submitted by universities. If no requests for UIRF match has been submitted, the monthly meeting may be canceled. No committee meetings shall occur without a quorum.

(3) A quorum shall consist of at least three committee members or their designees. The Committee may recommend to the Department potential revisions to the UIRF submission template and evaluation and recommendation processes.

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 8-2025, amend filed 11/21/2025, effective 11/21/2025
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0060 Application Process

(1) To request match funding a university SRO must submit a letter of interest to the Department at least 30 days in advance of the federal proposal deadline if at all possible. If a 30-day notice is not possible, a letter of interest should be submitted as early in the process as possible. Exceptions may be made by the Department to allow an application to be submitted less than 30 days before the federal deadline.

(2) The letter of interest will

(a) Be in the form required by the Department and submitted by the lead institution’s Senior Research SRO;

(b) Specify the federal program, project title, estimate of the total project budget and estimated amount of UIRF match requested from the Fund;

(c) Provide brief summaries of the project, project leaders/principal investigators, and any public and/or other collaborators;

(d) Provide a description of the project’s connection to economic development.

(3) Within 7 working days of receiving the letter of interest, the Department will notify the SRO if the department requires additional project details to facilitate evaluation by the Review Committee. Department will seek additional proposal information about the UIRF request. The lead university will have 14 days to submit additional materials requested by the Department. The Department will also attempt to schedule a Review Committee meeting as soon as reasonable given the additional information requested and the federal application deadline.

(4) If the Department determines a proposed project does not meet or is unlikely to meet program funding criteria, the Review Committee shall notify the project SRO that the proposed project will not be considered for program match funding unless revised and resubmitted.

(5) A request to provide additional information does not guarantee that a proposed project will receive UIRF match funding.

History

Statutory/Other Authority: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch. 643 OL 2019 & HB 2377 (2019)
OBDD 8-2025, amend filed 11/21/2025, effective 11/21/2025
OBDD 17-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-088-0070 Review and Decision-Making Processes With Evaluation Criteria

(1) The Review Committee shall evaluate project proposals in the order they are received based on the following criteria:

(a) Likelihood that proposal will have economic development benefits for Oregon;

(b) Likelihood that the proposal will enhance research and innovation capacity in Oregon including opportunities for student engagement;

(d) Amount of federal dollars leveraged per dollar of State UIRF match.

(2) Within the Review Committee, every SRO or designee gets one vote and the vote must pass by majority for those present, after a quorum is met. SROs representing proposals under review will not need to recuse themselves from voting.

(3) In the event that the Fund has insufficient monies to meet the requested match amount, the applicant must demonstrate to the satisfaction of the Review Committee that either the required additional match funds or non URIF funding agreements for the required additional match funds are in place.

(4) The Review Committee may review a project application and place it in a funding queue for future recommendation if current money in the Fund is insufficient to meet the requested match amount and an alternative source for the match funding cannot be demonstrated.

(5) When there is a funding queue and if additional match funding becomes available, the Committee shall make recommendations on project proposals in the funding queue in the order of the date of federal award as designated by the federal agency.

(6) A qualifying university may withdraw a proposal that has received Department approval for UIRF match funds at any time prior to entering into a grant agreement with the Department in order to make program funds available for another proposal.

(7) If the Review Committee approves UIRF match funding for a proposal and the Director of the Department agrees, the Director shall send a letter to the respective SRO and/or relevant federal agency committing UIRF match to the project contingent upon the conditions under OAR 123-088-080.

(8) If the Review Committee does not approve UIRF match funding for a proposal, the Review Committee chair shall notify the SRO for the applying university unless that university’s representative was present for the Review Committee’s vote.

(9) If the Department does not approve UIRF match funding for a proposal, Department staff shall send the SRO for the applying university a letter explaining why the UIRFmatch is not being committed.

(10) If the Review Committee vote is a tie, the Review Committee shall prepare a list of pro’s and con’s for providing UIRF match funding for a proposal and submit that to the Department for final determination.

(11) The Department shall take the Review Committee’s recommendation under advisement but has ultimate authority on funding decisions. The Department shall commit UIRF match funding to approved project proposals on a first-come-first-served basis, based on the date of the federal award notice.

(12) In cases of oversubscription, the university(ies) may, upon award, make appeals to the Oregon Innovation Council, another state agency or the Governor’s office; however, there is no guarantee of additional UIRF funds.

History

Statutory/Other Authority: Sec 21, Ch 643 OL 2019 & HB 2377 (2019)
Statutes/Other Implemented: Sec 21, Ch 643 OL 2019 & HB 2377 (2019)
OBDD 8-2025, adopt filed 11/21/2025, effective 11/21/2025

Division 89 OREGON INNOVATION FUND

Or. Admin. R. 123-089-0010 Purpose

The purpose of these rules is to describe objectives, programs, processes and criteria for funding projects from the Oregon Innovation Fund.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 6-2019, temporary amend filed 05/22/2019, effective 05/22/2019 through 11/15/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0020 Definitions

For the purposes of this division of administrative rules, additional definitions are found in OAR 123-001 (Procedural Rules). As used in this OAR 123 division 89, the following terms have the meanings set forth below, unless the context clearly indicates otherwise.

(1) “Fund” means the Oregon Innovation Fund established in ORS 284.720.

(2) “Innovation-based companies” are those that have high-growth potential that develop novel products, services, processes or business models that can be sold to national and international markets.

(3) “Oregon InC” means the Oregon Innovation Council as established and described in ORS 284.701 to 284.749.

(4) “Traded sector” is defined in Oregon statute as “industries in which member firms sell their goods or services into markets for which national or international competition exists.”

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0030 Objectives, Priorities and Programs

(1) The objectives of the Fund are to support early-stage, traded-sector companies diversify Oregon's economy, bring federal and private dollars into the state, increase revenues and create new jobs. Oregon InC is a public-private partnership that advises the Department on how best to design programs and provide funding to accomplish the Fund’s objectives. Oregon InC will identify certain industry sectors as priorities for the programs and funding. Moneys in the Fund are deployed via programs that are described in subsequent sections.

(2) The Department and Oregon InC will dedicate the Fund to one or more programs that support the Fund’s objectives. These programs may provide funding as grants, loans or investments. All programs will be designed and administered in accordance with applicable statutes and these rules and are primarily intended to support implementation of the agency’s innovation plan.

(3) Oregon InC will periodically evaluate industry focus areas to determine if the list remains appropriate or needs adjustment based on current conditions. Similarly, Oregon InC will periodically evaluate programs supported by the Fund to determine if they continue to meet the Fund’s objectives or require changes to, additions of or cancellation of programs to achieve those objectives. Subsequent sections describe the major Oregon InC programs.

History

Statutory/Other Authority: ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.706, ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 6-2019, temporary amend filed 05/22/2019, effective 05/22/2019 through 11/15/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0040 Eligibility and Criteria for Funding

(1) To be eligible for funding, projects must involve an innovation-based company in a traded-sector industry. Traded sector is defined in Oregon statute as industries in which member firms sell their goods or services into markets for which national or international competition exists.

(2) To be eligible for funding, organizations must be Oregon-based, which is defined as having more than 50% of the organization’s employees based in Oregon. Exceptions can be made on a case-by-case basis and require approval by the Innovation and Entrepreneurship Manager (I&E Manager). Any exception will be documented in the project files with a description of the reason for the exception.

(3) Other, program-specific eligibility requirements will be developed by the Department and/or Oregon InC that will be included in each program’s guidelines and requests for funding applications or proposals.

(4) The Department and/or Oregon InC will establish criteria for each funding program and opportunity. Examples of the criteria that could be used to evaluate projects include, but are not limited to:

(a) Leverage – This includes funding and other resources from the private sector, project collaborators or other sources. It also includes the use of non-financial leverage, such as supporting university research, other economic development activities and/or legislative initiatives. Financial and in-kind leverage must be specified.

(b) Uniquely attributable links to Oregon – This includes geographic advantages or other attributes unique to Oregon, as well as any link to one of Oregon InC’s focus areas or Business Oregon’s target industries.

(c) Level of impact derived from Oregon InC’s investment – The potential for the use of a relatively small amount of Oregon InC funding to have significant returns for the project and the State.

(d) Ability to scale into significant jobs and/or revenue – The potential for a project to have job and/or revenue impacts in the medium- to long-term.

(e) Broad impacts – This includes the project’s geographic scope, impacts on multiple income levels and other impacts.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 6-2019, temporary amend filed 05/22/2019, effective 05/22/2019 through 11/15/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0050 Application and Proposal Review and Evaluation Approval

(1) The Department will issue calls for grant applications or proposals for programs deploying moneys from the Fund. For requests for grant applications or proposals, the Department will issue a formal request with timelines, proposal requirements, criteria, eligible uses of funds and any other information necessary for an organization to submit a responsive application or proposal.

(2) The Department will review grant applications and proposals to determine whether they are complete and the proposer and the project are eligible for program funds.

(3) If an individual applicant or organization submitting an application or proposal is determined to be ineligible, the Department will notify the applicant or proposer that the application or proposal is ineligible.

(4) The Department may deem an application or proposal ineligible if the:

(a) Applicant, proposer or project fails to meet program eligibility requirements,

(b) Applicant or proposer fails to provide requested information by the date required by the Department; or

(5) The I&E Manager will consider protests of the eligibility determination. Only the affected applicant or proposer may protest. Protests must be submitted in writing to the I&E Manager within 30 days of the date the applicant or proposer was notified of being ineligible. The I&E Manager’s decision is final.

(6) The Department will coordinate with Oregon InC to evaluate applications and proposals using the criteria listed in section 123-089-0040 and any other relevant information. The Department and Oregon InC may utilize review committees comprised of Oregon InC members, Department staff and/or other external experts to review eligible applications or proposals and provide feedback on the quality of applications or proposals.

(7) Department staff will use the review committee’s feedback to develop a recommendation of what projects should receive awards. Staff will review the recommendation with Department management and Oregon InC. Department staff may schedule a special meeting of Oregon InC to consider grant recommendations if regular meetings will not occur for too long after evaluation processes are complete.

(8) Oregon InC may delegate its role in the grant review and award process to a review committee as described in (6) via a delegation of authority resolution. If so, this delegated group will work with Department staff to evaluate proposals and advance the funding recommendation to the Department. Staff will provide a report to Oregon InC at its next meeting on the group’s activities and any funding recommendations or rejections.

(9) The Director approves grant awards based on Oregon InC’s and staff’s recommendations. The Director’s funding decisions are final.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 6-2019, temporary amend filed 05/22/2019, effective 05/22/2019 through 11/15/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0060 Agreements and Disbursement of Funds

(1) The Department will negotiate grant agreements with those organizations chosen for funding.

(2) The Department shall disburse monies from the Fund only after entering into a binding agreement with the organization.

(3) The agreement will be in form and substance as provided by the Department. The agreement will contain provisions that the Department considers necessary or appropriate to ensure legal sufficiency and proper project oversight. The agreement will include a provision that the obligation of the Department under the agreement is contingent upon the availability of moneys in the Fund.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 16-2019, amend filed 11/12/2019, effective 11/12/2019
OBDD 6-2019, temporary amend filed 05/22/2019, effective 05/22/2019 through 11/15/2019
OBDD 3-2018, adopt filed 02/12/2018, effective 02/12/2018

Or. Admin. R. 123-089-0070 Audit Committee

Oregon InC has established an Audit and Accountability Committee (Audit Committee) that shall monitor the performance of larger projects from the Fund. The Audit Committee will typically provide oversight of any projects that receive funding of over $250,000 although oversight can be modified by the Council as needed. If an organization managing a project does not achieve its goals, the Department and Audit Committee will work with the organization to determine the cause(s) and identify action(s) to be taken to address the cause(s). If the action(s) are insufficient or unsuccessful, the Audit Committee can recommend to Oregon InC to reduce or eliminate funding or require funding be repurposed for a different activity. Oregon InC will evaluate the Audit Committee’s recommendation and either approve the recommendation and forward it to the Department or work with the Audit Committee and the Department to revise the recommendation. The Director will decide about any repurposing, reduction or elimination of funding. The Director’s decision is final.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, adopt filed 11/12/2019, effective 11/12/2019

Or. Admin. R. 123-089-0080 Programs

(1) Centers of Innovation Excellence (CIEs): The Department and Oregon InC may dedicate a portion of the Fund to support the operations of one or more Centers of Innovation Excellence (CIEs). CIEs incentivize collaboration and foster innovation within Oregon’s existing and emerging traded sectors by catalyzing the commercialization and deployment of new products, services and processes. CIEs represent the evolution of the former Signature Research Center (SRC) model and are statewide, sector-specific, public-private partnerships that develop the funding, talent and support services in sectors where Oregon has a competitive advantage. Each CIE will be designed and operated in a way that meets the needs of the specific sector and the existing assets in that sector. In accordance with these rules, the Department will conduct a process to request and evaluate applications for CIEs with defined criteria, expectations, eligible uses of funds and periods of submission. The Audit Committee will review and approve performance metrics and goals for the CIEs and perform regular evaluation of their performance.

(2) Regional Innovation Hubs (Hubs) Program: The Department and Oregon InC may dedicate a portion of the Fund to issue grants to designate and support one or more Regional Innovation Hubs (“Hubs”). Hubs are regionally focused, sector-agnostic partnerships that implement programs, strategies and connections that meet the needs of innovation-based entrepreneurs in high-growth, traded-sector industries. Hubs build and advance a regional innovation ecosystem, as well as provide access to technical assistance, capital, networking, mentorship and talent development for innovators in these industries. In accordance with these rules, the Department will conduct a process to request and evaluate applications for Hub designation with defined criteria, expectations, eligible uses of funds and periods of submission.

(3) High Impact Opportunity Projects (HIOPs) Program: The Department and Oregon InC may dedicate a portion of the Fund to issue grants that support the growth of emerging, potentially high-value industry sectors. The funding will support discrete projects, called High Impact Opportunity Projects (HIOPs), that will build or unite target industries around new or emerging technology, remove barriers to growth or increase capacity of Oregon InC’s target industries. HIOP funding is not intended to support the development or commercialization of an individual company’s technology or intellectual property. In accordance with these rules, the Department will conduct a process to request and evaluate proposals for HIOP grants with defined criteria, expectations, eligible uses of funds and periods of submission.

(4) Commercialization Gap Fund Program: The Department and Oregon InC may dedicate a portion of the Fund to issue grants and/or investments that support commercialization of technologies by early-stage companies often in conjunction with university partners and CIEs. The Commercialization Gap Fund is focused on bridging early-stage capital gaps so that these companies can develop to the point of being attractive to private capital to continue their growth and development. In accordance with these rules, the Department will conduct a process to request and evaluate applications for the management of the Commercialization Gap Fund program with defined criteria, expectations, eligible uses of funds and periods of submission.

(5) Small Business Innovation Research (SBIR) Support Program: The Department and Oregon InC may dedicate a portion of the Fund to the Small Business Innovation Research (SBIR) Support Program. The SBIR Support Program is intended to help Oregon companies access federal commercialization funding and help those companies that do receive funding fill gaps in how the federal funding can be used. The SBIR Support Program applies specifically to the federal commercialization programs called the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, which are designed to stimulate technological innovation and provide opportunities for small businesses to conduct research and development with commercialization potential. Hereafter, these rules refer to both the SBIR and STTR programs as SBIR. The federal SBIR program usually provides grants in two phases: Phase I grants help very early-stage companies do proof of concept/feasibility studies on new technologies, while Phase II grants build on Phase I work to help companies develop commercially ready prototypes to test with customers. The Department’s SBIR Support Program has two components: application assistance grants (called Phase 0 or Phase 00 Grants) and Matching Grants. Phase 0 or 00 Grants are awarded via an application process. As long as a company meets the eligibility requirements and funds are available, the grant is awarded. Matching Grants are awarded via a competitive, request for grant applications process. In accordance with these rules, the Department will institute a process to award Phase 0 and 00 Grants as well as a separate process to award Matching Grants. The processes will include eligibility requirements, eligible uses of funds and expectations among other things.

(6) Other Programs or Activities: The Department and Oregon InC may dedicate a portion of the Fund to support other programs or activities that help achieve Oregon InC’s objectives. Any additional programs will be developed in accordance with these rules. If a new program will provide funding via a competitive process, the Department will issue one or more requests for applications or proposals with defined eligibility requirements, eligible uses of funds, criteria and periods of submission. If the funding is used for other activities, including sponsorships, the Department will develop the justification for why the funding is necessary and appropriate and what the funding will achieve. The Department will report on any other activities supported by the Fund at the Oregon InC meeting following the funding award.

History

Statutory/Other Authority: ORS 284.706, ORS 284.720 & ORS 284.742
Statutes/Other Implemented: ORS 284.720 & ORS 284.742
OBDD 17-2026, amend filed 08/19/2026, effective 08/19/2026
OBDD 9-2025, temporary amend filed 12/01/2025, effective 12/01/2025 through 05/29/2026
OBDD 16-2019, adopt filed 11/12/2019, effective 11/12/2019

Division 90 STRATEGIC RESERVE FUND

Or. Admin. R. 123-090-0000 Purpose

The Strategic Reserve Fund was established by the Oregon Legislative Assembly to support economic and community development in Oregon. Particular emphasis shall be placed on investments that assist communities, businesses or industries with cost effective projects that assist the creation, expansion, and preservation of traded sector industries of Oregon, and that encourage diversification and preservation of regional economies.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.266
EDD 29-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2000, f. & cert. ef. 4-11-00
EDD 29-1988, f. & cert. ef. 8-30-88
EDD 26-1988(Temp), f. & cert. ef. 7-13-88

Or. Admin. R. 123-090-0010 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) "Administrative Expenses" mean any agency expenditures included under the classifications of expenditures, except categories of debt service and special payments, which are prepared and prescribed for purposes of agency budget-making and accounting.

(2) "Community" means an area or a locality in which the body of inhabitants has common economic or employment interests. The term is not limited to a city, county or other political subdivision and need not, but may be, limited by political boundaries.

(3) "Fund" means the Strategic Reserve Fund established by ORS 285B.266.

(4) "Debt Retirement" means payment in full of the balance owed on the principal of a loan.

(5) "Debt Service" means the interest and charges currently payable on a debt, including principal payments.

(6) "Rural Area" means an area located entirely outside of the acknowledged Portland Metropolitan Area Regional Urban Growth Boundary and the acknowledged urban growth boundaries of the cities of 30,000 or more in population, including Albany, Bend, Corvallis, Eugene, Springfield, Salem, Keizer or Medford.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.266
EDD 29-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2000, f. & cert. ef. 4-11-00
EDD 23-1990, f. & cert. ef. 8-17-90
EDD 20-1990(Temp), f. & cert. ef. 6-28-90
EDD 6-1990(Temp), f. & cert. ef. 3-15-90
EDD 29-1988, f. & cert. ef. 8-30-88
EDD 26-1988(Temp), f. & cert. ef. 7-13-88

Or. Admin. R. 123-090-0020 Funding Eligibility

The Strategic Reserve Fund may be used to finance economic and community development projects that:

(1) Are reasonably expected to result in new jobs, job retention, or higher incomes for Oregonians;

(2) Provide assistance to businesses that are considering starting in, expanding in, or relocating to Oregon. Assistance will be reserved for projects that result in a significant long-term economic benefit for residents of the county in which the project will be located; or

(3) Serve as a catalyst for additional economic and community development benefits, or that will result in improved utilization of existing Oregon resources.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B.266
EDD 7-2000, f. & cert. ef. 4-11-00
EDD 29-1988, f. & cert. ef. 8-30-88
EDD 26-1988(Temp), f. & cert. ef. 7-13-88

Or. Admin. R. 123-090-0030 Ineligible Expenditures

Strategic Reserve Funds will not be used to assist:

(1) Relocation of a business from one part of the state to another, except for businesses that would otherwise relocate outside Oregon. This restriction may be waived if the Director finds there is good and sufficient reason.

(2) The retirement or service of debt for any public or private entity; or

(3) The Department with any administrative expenses without legislative authorization.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.266
EDD 29-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2000, f. & cert. ef. 4-11-00
EDD 23-1990, f. & cert. ef. 8-17-90
EDD 20-1990(Temp), f. & cert. ef. 6-28-90
EDD 6-1990(Temp), f. & cert. ef. 3-15-90
EDD 29-1988, f. & cert. ef. 8-30-88
EDD 26-1988(Temp), f. & cert. ef. 7-13-88

Or. Admin. R. 123-090-0040 Director’s Review

(1) Projects shall not be funded by the Fund unless the Director finds that:

(a) The Project is or will be supported by the maximum feasible amount of local and private financial participation;

(b) The Project will produce significant long-term, regional or statewide economic impacts;

(d) The Project does not supplant private investment or duplicate or undermine similar efforts; and,

(e) The Project meets, or can be reasonably expected to meet, at least one of the following criteria:

(A) The Project uses existing human and natural resources to harness Oregon's economic comparative advantage;

(B) The Project promotes economic and community recovery in Rural or Distressed areas, or among populations suffering economic hardship;

(D) The Project promotes the development of new national and international markets for goods and services produced in Oregon; or,

(2) If the Project affects land use, it must satisfy the applicable requirements of OAR chapter 123, division 8 of this Department.

(3) Funding decisions shall be made by either the Governor or the Director.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.266
EDD 29-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2000, f. & cert. ef. 4-11-00
EDD 23-1990, f. & cert. ef. 8-17-90
EDD 20-1990(Temp), f. & cert. ef. 6-28-90
EDD 29-1988, f. & cert. ef. 8-30-88
EDD 26-1988(Temp), f. & cert. ef. 7-13-88

Or. Admin. R. 123-090-0050 First Source Hiring

Any firm receiving an award of more than $100,000 through the Strategic Reserve Fund shall enter into a first source agreement in accordance with division 70 of this chapter of administrative rules.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.266
OBDD 3-2011, f. 6-30-11, cert. ef. 7-1-11
EDD 7-2007, f. & cert. ef. 8-30-07
EDD 7-2000, f. & cert. ef. 4-11-00

Or. Admin. R. 123-090-0060 Waivers

The Director may waive non-statutory requirements of this division of administrative rules if the project demonstrates a contribution to state job strategies consistent with the purpose of the Strategic Reserve Fund. Projects that improve the economic condition of a Rural or Distressed Area, or further global competitiveness of Oregon firms may receive special consideration by the Director.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B.266
EDD 29-2009, f. 12-31-09, cert. ef. 1-1-10
EDD 7-2000, f. & cert. ef. 4-11-00

Division 91 OREGON BUSINESS RETENTION AND EXPANSION PROGRAM

Or. Admin. R. 123-091-0001 Purpose

This division of administrative rules clarifies, specifies and establishes procedures, standards and criteria for operation of and making loans to businesses from the Oregon Business Retention and Expansion Program (OBEP).

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Or. Admin. R. 123-091-0010 Definitions

For the purpose of this rule, the following terms shall have the following meanings:

(1) “Business” means any individual, association of individuals, joint venture, partnership, limited liability company or corporation which is validly existing and authorized to conduct business in Oregon.

(2) “Calendar year” means an individual’s tax year of January 1–December 31.

(3) “Department” means the Oregon Business Development Department as established under ORS 285A.070.

(4) “Director” means the director of the Department as appointed under ORS 285A.070.

(5) “Eligible Employee” means a new employee of the Business:

(a) Who will have an annual wage that is at least 150% of the most recently available average pay for the county in which the new job will be created or the most recently available average pay for the state, both as determined by the Oregon Employment Department in the Covered Employment and Wages Summary Report, whichever is less;

(b) Who will be hired by the Business at its Oregon facility before the end of the two calendar years following the year of OBEP loan approval;

(c) For whom FICA and state and federal income taxes are deducted from his/her gross wages, which are then forwarded to the appropriate agencies by the Business on behalf of the person;

(d) For whom the Business pays state and federal unemployment insurance; and

(e) For whom the Business contributes to FICA.

(6) “Full-time Job” one Full-time Job equals 1,820 Hours Worked in a one-year period.

(7) “Hours Worked” means all hours that the employee worked, if the employee is paid for those hours. “Hours worked” does not include holiday, vacation time, sick leave or any other paid time where no work is performed.

(8) “OBEP Fund” means the Oregon Business Retention and Expansion Fund.

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Or. Admin. R. 123-091-0015 Criteria for OBEP Fund Loan

In order to be eligible for a loan from the OBEP Fund, the Department must first find:

(1) That, at the time a loan from the OBEP Fund is considered for approval, the Business:

(a) Has at least 150 employees as demonstrated by documentation determined to be acceptable by the Department;

(b) Is a traded sector business, as defined in ORS 285A.010;

(d) Plans to hire at least 50 full-time Eligible Employees before the end of the two calendar years following the year in which the OBEP loan is approved;

(e) Has stated to the Department that a loan from the OBEP was an integral factor in the Business’s decision to hire at least 50 full-time Eligible Employees; and

(f) Has provided all information to the Department as requested and as required by the Oregon Business Retention and Expansion Program;

(2) That the Business’s proposed expansion will result in significant, long-term economic benefit in the region and will serve as a catalyst for additional economic development benefits in the state.

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Or. Admin. R. 123-091-0020 Approval and Amount of OBEP Fund Loan

(1) The Director, or his designee, in his sole discretion, shall determine whether to approve a loan to a Business from the OBEP Fund and the amount of the loan.

(2) A loan from the OBEP Fund shall not exceed the lesser of:

(a)(A) The amount of estimated Oregon personal income taxes to be paid in the two calendar years following the year of OBEP loan approval by Eligible Employees, using the result of the following formula:

(B) Average wage of all Eligible Employees multiplied by the applicable Tax as a Percent of Taxable Income from Table B: Average Income and Tax (Dollars) in the Oregon Department of Revenue’s most recently published Oregon Personal Income Tax Statistics, All Returns and Full-Year Resident Returns (by AGI) multiplied by 2.

(b) The amount currently available in the OBEP Fund.

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Or. Admin. R. 123-091-0025 Loan Agreement

After approval of a loan from the OBEP Fund, the Department will enter into a loan agreement with the Business. Among other items, the loan agreement will contain the following provisions:

(1) The Business must enter into a First Source Agreement in accordance with OAR 123-070;

(2) The Business, to the extent practicable, must consult with vendors in Oregon before entering into contracts for goods and services;

(3) The Business must duly execute and deliver the following to the Department within 90 days from the date the loan was approved:

(a) Loan agreement;

(b) Promissory note;

(d) Any other certificates, opinions and documents as the Department may reasonably require regarding the authorization of the loan agreement, the promissory note and any related documents.

(4) Loan funds must be disbursed to the Business no later than 120 days after the loan was approved, provided that the Department, in the reasonable exercise of its administrative discretion, has made a determination that there are sufficient funds in the OBEP Fund to make the disbursement;

(5) The terms for forgiveness of the loan, which will, among other items, require that the personal income tax estimated to be generated by the new Full-time Jobs in no more than two consecutive calendar years is equal to or exceeds the amount of the loan and that the actual number of new Full-time Jobs is equal to or exceeds the number of Full-time Jobs proposed at the time the loan was approved. The Department intends to obtain information to calculate the personal income tax estimated to be generated by the new Full-time Jobs and the actual number of new Full-time Jobs from the Oregon Employment Department. If the Department is not able to obtain information from the Oregon Employment Department to make these calculations, the Business will be required to provide comparable information, as the Department may reasonably request, to the Department.

(6) If the personal income tax estimated to be generated by the new Full-time Jobs (“Total PIT”) is less than the amount of the loan, the Business must immediately repay to the Department an amount equal to: (the loan amount multiplied by .5) multiplied by (1 – (Total PIT / the loan amount)). If the actual number of new Full-time Jobs is less than the number of new Full-time Jobs proposed at the time the loan was approved, the Business must immediately repay to the Department an amount equal to: (the loan amount multiplied by .5) multiplied by (1 – (the actual number of new Full-time Jobs / the required number of new Full-time Jobs); and

(7) The Business must submit a report to the Department which lists categories of new positions created in the time period used to calculate the personal income tax, as described in paragraph e. above, the average hourly wage of the new positions, and the number of persons hired to fill those positions.

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Or. Admin. R. 123-091-0030 Waivers

The Director, or his designee, may waive non-statutory requirements of this division of administrative rule if such a waiver will serve to further the goals of the Oregon Business Retention and Expansion Program.

History

Statutory/Other Authority: ORS 285A.075, 285B & OL Ch. 549, Sec. 1-8 & 10-11
Statutes/Other Implemented: ORS 285B, OL Ch. 549, Sec. 1-8 & 10-11
OBDD 4-2012, f. 3-30-12, cert. ef. 4-2-12

Division 92 SMALL BUSINESS EXPANSION LOAN FUND (OREGON ROYALTY FUND)

Or. Admin. R. 123-092-0010 Purpose

The purpose of these rules is to provide procedures, standards and criteria for the making of loans from the Small Business Expansion Loan Fund, also referred to as the Oregon Royalty Fund (ORF).

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092 & OL Ch 71 2018
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0020 Definitions

For the purpose of these rules additional definitions may be found in Procedural Rules, OAR 123-001-0050. For purposes of this division of administrative rules, unless the context requires otherwise:

(1) "Applicant" means any person or any combination of persons applying for a loan from the Oregon Royalty Fund through the Oregon Royalty Loan Program or the Oregon Angel Loan Program.

(2)(a) "Business Development Project" means the use of working capital or the acquisition, engineering, improvement, rehabilitation, construction, operation or maintenance of any property, whether real or personal, by an Oregon Growth Business to support its growth.

(b) Specifically excluded from the definition of Business Development Project is any use of funds for:

(A) relending; or

(B) expenditure for personal purposes, including the refinancing of personal debt or debt not otherwise incurred for business purposes.

(3) “Exit” refers to any liquidity event, including a merger, acquisition, buyout, additional outside debt financing or any type of change in management control.

(4) "Exit Fee” means an amount that is typically between 2 to 2.5 times the amount of the loan that is to be paid to the Oregon Business Development Department at the time of an “Exit”. The amount is based on the due diligence performed on the company, project and the associated risk. Due diligence will include factors including, but not limited to, the current recurring sales, proformas and assumptions, amount of equity commitments, qualifications of the management team, term of the loan, value of collateral available and pledged as security, the availability and strength of personal guarantees.

(5) "Finance Committee” means the Finance Committee whose members are appointed by the Chair of the Oregon Business Development Commission as outlined in OAR 123-001-0520. Regarding the approval, setup, documentation, or issuance of a new loan from the ORF in a principal amount of $250,000 or less, “Finance Committee” means the Director of the Oregon Business Development Department or the Director’s designee. The Department shall submit to the Finance Committee all loans greater than $250,000, or otherwise referred to the Finance Committee at the sole discretion of the Department, for a credit decision.

(6) “Liquidity Event” includes a merger, acquisition, buyout, additional outside debt financing, prepayment or any type of change in management control or ownership

(7) "Local Development Group" as used in OAR 123-092-0090, means any contracted group based in Oregon that is either a:

(a) public or private corporation that has as one of its primary purposes, as stated in its articles of incorporation, charter or bylaws, the promotion of economic development in any part of the State of Oregon; or

(b) an angel or venture fund/ investor; or

(c) a local or regional business incubator or accelerator that, in the sole discretion of the Department, targets early stage, high-growth oriented, Traded Sector companies.

(8) “Oregon Growth Business” means an Oregon business with 50 or fewer full-time-equivalent employees that is in the traded sector or that primarily supports traded sector industries.

(9) “Oregon Royalty Fund” or “Fund" or "ORF" means the Small Business Expansion Loan Fund established in 2018 c.71.

(10) “Oregon Angel Loan Program” or "OAL" means a loan made subject to the terms and conditions of the Oregon Angel Loan Program in OAR 123-092-0065.

(11) “Oregon Royalty Loan Program” or “ORL” means a loan made subject to the terms and conditions of the Oregon Royalty Loan Program in OAR 123-092-0060.

(12) "Person" means any individual, association of individuals, joint venture, partnership, limited liability company or corporation.

(13) “Royalty” means payments calculated as a percentage of the borrower’s sales or revenue as a means of effecting an adequate rate of return typically up to 2X on the monies loaned, as determined at the sole discretion of the Department.

(14) "SSBCI Funds” means U.S. Treasury funds allocated to the Department through the State Small Business Credit Initiative Program (SSBCI Program) administered by the United States Department of the Treasury. Links to the SSBCI Capital Program Policy Guidelines and Frequently Asked Questions may be found under Program Rules and Materials at the following hyperlink: https://home.treasury.gov/policy-issues/small-business-programs/state-small-business-credit-initiative-ssbci. The Department, at its sole discretion, will determine the source of funding and all loans approved utilizing SSBCI Funds shall be subject to additional terms, conditions and requirements of the SSBCI Program.

(15) “Total Repayment” means repayment of all outstanding principal, interest, Exit Fee and/or Royalty payments.

(16) "Traded sector" has the meaning given that term in ORS 285A.010.

(17) "Traded sector activities" means activities that produce goods or services for the traded sector.

History

Statutory/Other Authority: ORS 285B.092 & ORS 285B.130 & ORS 285B.133
Statutes/Other Implemented: ORS 285B.092 & ORS 285B.130 & ORS 285B.133
OBDD 25-2023, amend filed 10/04/2023, effective 10/04/2023
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 13-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0030 Eligibility

(1) Eligible projects are business development projects as defined in OAR 123-092-0020(2).

(2) To be eligible, an applicant must operate an Oregon Growth Business.

(3) The primary focus of ORF is to provide net, new money financing for Oregon Growth Businesses. However, applications to refinance an Oregon Growth Business’s existing debt or equity financing may be considered on a limited basis at the sole discretion of the Department.

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092 & OL Ch 71 2018
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 13-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0040 Reserved Loans

The Department may reserve up to 20 percent of all moneys available for lending in the ORF on July 1 of each fiscal year for loans during the fiscal year that begins on that day to applicants who are individuals or for which a majority of whose owners are individuals considered to have low to moderate household income and low to moderate personal net worth, as defined by the Department, and who operate businesses:

(1) Controlled and with at least 51 percent ownership interest by minorities (as defined by the Department), women, or honorably discharged veterans; or

(2) That are located outside of the Portland, Oregon, Metropolitan Statistical Area.

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092 & OL Ch 71 2018
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 13-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0050 Application Procedure

(1) An applicant may submit an application to the Department on a form or in a format approved by the Department, together with an Application Fee.

(2) If the amount of the loan being sought from the Fund is $250,000 or less, the Director may in the Director's sole discretion approve or deny the loan request or make a recommendation to the Finance Committee for the Committee's consideration.

(3) For loan requests that exceed $250,000, the Department may deny the loan requested or make a recommendation to the Finance Committee, which may then in its sole discretion approve or deny the loan request.

(4) If a loan request is approved, the Department shall prepare the documents necessary to close the loan transaction. Such documents shall reflect all terms and conditions upon which the Finance Committee conditioned approval of the loan. Any material modifications of those terms and conditions must be approved by the Chair of the Finance Committee or his/her designee, or the Director for loans of $250,000 or less.

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092 & OL Ch 71 2018
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0060 Loan Conditions of the Oregon Royalty Loan Program

The Department may approve a loan request if it finds that:

(1) The proposed Business Development Project is feasible and a reasonable risk from practical and economic standpoints, the Applicant demonstrates readiness for market, and the loan has a reasonable prospect of repayment.

(2) The applicant can provide good and sufficient collateral for the loan and personal and/or corporate guarantees, or a combination of the preceding items, that are adequate relative to the risks and potential returns, and the applicant's financial resources are adequate to ensure success of the project, all as determined by the Department at its sole discretion. Collateral value will be determined at the sole discretion of the Department. A lack of sufficient collateral or a lack of guarantor support may result in a higher return requirement to offset the higher risk associated with either not having sufficient collateral and or guarantor support.

(3) The Applicant demonstrates to the Department’s satisfaction a reasonable potential for strong gross profit margin and rapid sales growth that may support economic diversification in the state or the region in which the business is conducted, increase employment opportunities or retain existing jobs in the state or region, or increase the competitiveness of the Applicant’s business in the Traded Sector.

(4) While an ORL may fund up to 100% of the Business Development Project, preference may be given to Business Development Projects that include funding sources other than the ORL.

(5) Any loans approved by the Department utilizing SSBCI Funds must demonstrate a minimum 1:1 match of private equity raised as a result of the ORL for the project. Utilization of SSBCI Funds in a project to fund a loan are made at the sole discretion of the Department and all loans greater than $250,000 will be required to use SSBCI Funds unless otherwise waived by the Department.

(6) Monies in the Fund are or will be available for the proposed business development project.

(7) The applicant and Qualified Business must be in compliance with, and remain compliant with all local, state and federal laws and regulations.

(8) The applicant, borrower, guarantors and principal owners are current on all obligations to the State of Oregon.

(9) The applicant can show the ability to repay an amount typically up to 2X of the loan amount over a three (3) to five (5) year period.

(10) The applicant can demonstrate existing reoccurring sales to repay the loan.

History

Statutory/Other Authority: ORS 285B.092, ORS 285A.060, ORS 285A.070 & ORS 285B.130 & ORS 285B.133
Statutes/Other Implemented: ORS 285B.092, ORS 285A.060, ORS 285A.070 & ORS 285B.130 & ORS 285B.133
OBDD 25-2023, amend filed 10/04/2023, effective 10/04/2023
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 13-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0065 Loan Conditions of the Oregon Angel Loan Program

The Department may approve a loan request if it finds that:

(1) The proposed business development project is feasible and a reasonable risk from practical and economic standpoints, the applicant demonstrates readiness for market, and the loan has reasonable prospect of repayment.

(2) The applicant can provide sufficient collateral for the loan and personal and/or corporate guarantees, or a combination of the preceding items, that are adequate relative to the risks and potential returns, and the applicant's financial resources are adequate to ensure success of the project, all as determined by the Department at its sole discretion. Collateral value will be determined at the sole discretion of the Department. A lack of sufficient collateral or a lack of guarantor support may result in a higher return requirement to offset the higher risk associated with either not having sufficient collateral and or guarantor support.

(3) The applicant demonstrates to the satisfaction of the Department a reasonable potential for strong gross profit margin and sales growth that may support economic diversification in the state or the region in which the business is conducted, increase employment opportunities or retain existing jobs in the state or region, or increase the competitiveness of the applicant business in the traded sector.

(4) While an OAL may fund up to 100% of the business development project, preference may be given to business development projects that include funding sources other than the OAL.

(5) Any loans approved by the Department utilizing SSBCI Funds must demonstrate a minimum 1:1 match of private equity raised as a result of the OAL for the project. The Department may require additional private match as a condition of approval at its sole discretion. Utilization of SSBCI Funds in a project to fund a loan are made at the sole discretion of the Department and all loans greater than $250,000 will be required to use SSBCI Funds unless otherwise waived by the Department.

(6) Monies in the Fund are or will be available for the proposed business development project.

(7) The applicant and Qualified Business must be in compliance with, and remain compliant with, all local, state and federal laws and regulations.

(8) The applicant, borrower, guarantors and principal owners are current on all obligations to the State of Oregon.

(9) The applicant can demonstrate existing reoccurring sales to repay the loan.

History

Statutory/Other Authority: ORS 285B.092, ORS 285A.060, ORSA.070 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092, ORS 285A.060, ORSA.070 & OL Ch 71 2018
OBDD 25-2023, adopt filed 10/04/2023, effective 10/04/2023
OBDD 6-2023, temporary adopt filed 04/12/2023, effective 04/12/2023 through 10/08/2023

Or. Admin. R. 123-092-0070 Loan Agreement for an Oregon Royalty Loan

(1) If the Finance Committee approves a loan, the Department and the borrower may enter into a loan contract that, among other matters:

(a) shall set forth a plan for repayment by the borrower to the Oregon Royalty Fund moneys borrowed through the Oregon Royalty Loan Program, along with royalties calculated as a percentage of the borrower’s sales or revenue as a means of effecting an adequate rate of return typically up to 2X on the monies loaned, as determined at the sole discretion of the Finance Committee, and:

(A) based on loan pricing and total repayment costs, ORL financing for the project does not directly compete with traditional commercial lending sources,

(B) is commensurate with the level of risk taken when making the loan and are anticipated to cover operational expenses and losses incurred by the ORF.

(b) Shall set forth a schedule of or conditions triggering payments and the period of the loan, which shall not exceed 61 months from the date of the loan contract.

(c) Shall provide that the liability of the State under the contract is contingent upon the availability of moneys in the Oregon Royalty Fund for use in the business development project.

(d) Shall require that the borrower is responsible for payment of, separate and above any other amounts owed on the loan:

(A) Insurance premiums as needed to maintain in full force life insurance and other types of insurance in an amount and coverage that is acceptable to the Finance Committee.

(B) Out-of-pocket costs associated with the loan closing which may include but are not limited to filing fees, recording fees, title insurance, appraisals, and attorney fees.

(e) That the borrower will provide to the Department on a periodic basis, such financial statements as the Department may require.

(f) Shall provide that the applicant, borrower, guarantors, and principal owners are in compliance with and agrees to abide by all federal, state, and local laws and regulations.

(g) Shall specify any additional payment from the borrower as the Finance Committee may require for other circumstances, such as if the borrower elects to repay the loan before the originally approved term, if the borrower is acquired or experiences a significant change in ownership, or to achieve a specified repayment amount or rate of return.

(h) At a Liquidity Event, the full repayment amount as agreed upon will be due in full.

(2) The Department, at its sole discretion, may require the execution of a Commitment Letter and receipt of a non-refundable Commitment Fee to secure resources necessary to fund the loan. The Commitment Fee will be applied at closing to the Loan Fee. If the loan does not close, the Commitment Fee will not be refunded.

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: ORS 285B.092 & OL Ch 71 2018
OBDD 25-2023, amend filed 10/04/2023, effective 10/04/2023
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 13-2019, adopt filed 09/04/2019, effective 09/04/2019

Or. Admin. R. 123-092-0075 Loan Agreement for an Oregon Angel Loan

(1) If the Department approves a loan, commitments are good for 12 months and conditioned upon the borrower raising between 1 to 10X of the amount of the Oregon Angel Loan Fund Award (e.g., $250,000 Angel Loan Award at 4X would require no less than $1,000,000 of new closed private equity/debt financing). The Department and the borrower may enter into a loan contract that, among other matters, shall set forth a plan for repayment by the borrower to the Oregon Royalty Fund moneys borrowed from the Fund through the Oregon Angel Loan Program and shall include terms that include:

(a) Total Repayment means repayment of all outstanding principal, interest and the Exit Fee.

(A) The Exit Fee will be held in perpetuity and is due upon a merger, acquisition, buyout, additional outside debt financing or any type of change in management control or ownership. If there is not an arms-length merger, acquisition or buyout determining the value of the business, the Exit Fee will be based upon an independent valuation of the business. The Department, at its sole discretion may make demand for payment in full for the Exit Fee at maturity. Any terms and conditions extended to repay the Exit Fee through periodic payment of principal and interest are made at the sole discretion of the Department and may require, but shall not be limited to, personal guarantees, pledges of business and/or personal assets or any other collateral and security the Department deems prudent to adequately secure the outstanding obligation.

(B) Amount of the Exit Fee is based on the due diligence performed on the company and project. Due diligence will include factors including, but not limited to, the current recurring sales, proformas and assumptions, amount of equity commitments, qualifications of the management team, term of the loan, value of collateral available and pledged as security, current and anticipated future valuation of the company, and the availability and strength of personal guarantees. A typical Exit Fee is between 5-10% of the business valuation at the time of the Exit.

(C) The pledge to achieve Total Repayment, security and guarantees for the Oregon Angel Loan will remain in effect until the loan is paid in full.

(D) Total Repayment will be required at a Liquidity Event.

(b) Repayment will be interest only for up to five (5) years. Interest only payments are based on the Federal Applicable Finance Rate (AFR) on the outstanding principal balance.

(d) Based on loan pricing and total repayment costs:

(A) OAL financing for the project does not directly compete with traditional commercial lending sources,

(B) is commensurate with the level of risk taken when making the loan, and

(e) Shall set forth a schedule of or conditions triggering payments and the period of the loan, which shall not exceed 61 months from the date of the loan contract.

(f) Shall provide that the liability of the State under the contract is contingent upon the availability of moneys in the Fund for use in the business development project.

(g) Shall require that the borrower is responsible for payment of, separate and above any other amounts owed on the loan:

(A) Insurance premiums as needed to maintain in full force life insurance and other types of insurance in an amount and coverage that is acceptable to the Department.

(B) Out-of-pocket costs associated with the loan closing which may include but are not limited to filing fees, recording fees, title insurance, appraisals, and attorney fees.

(h) That the borrower will provide to the Department on a periodic basis, such financial statements as the Department may require.

(i) Shall provide that the applicant, borrower, guarantors, and principal owners are in compliance with and agrees to abide by all federal, state, and local laws and regulations.

(j) Shall specify any additional payment from the borrower as the Department may require for other circumstances, such as if the borrower elects to repay the loan before the originally approved term, if the borrower is acquired or experiences a significant change in ownership, or to achieve a specified repayment amount or rate of return.

History

Statutory/Other Authority: ORS 285B.092 & ORS 285B.130 & ORS 285B.133
Statutes/Other Implemented: ORS 285B.092 & ORS 285B.130 & ORS 285B.133
OBDD 25-2023, adopt filed 10/04/2023, effective 10/04/2023
OBDD 6-2023, temporary adopt filed 04/12/2023, effective 04/12/2023 through 10/08/2023

Or. Admin. R. 123-092-0080 Servicing, Amendments and Modifications

(1) All loans shall be monitored by, and all loan repayments shall be made to, the Department.

(2) It is the responsibility of the borrower to ensure that the Department receives its payment by the due date.

(3) Any request for modification or amendment to any loan condition including extension of payments shall be made in writing to the Department and approved or declined by the Chair of the Finance Committee, or the Director for loans with a principal balance of $250,000 or less.

History

Statutory/Other Authority: ORS 285B.092 & OL Ch 71 2018
Statutes/Other Implemented: OL Ch 71 2018
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 9-2019, minor correction filed 07/10/2019, effective 07/10/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Or. Admin. R. 123-092-0090 Fees and Charges

(1) The Department shall charge and collect a non-refundable Application Fee of $500 at the time the application is submitted. If the loan is declined or does not close, the Application Fee will not be refunded.

(2) The Department may charge and collect a Commitment Fee in an amount up to one percent (1%) of the approved principal amount of the loan. The Commitment Fee will be applied at closing of the loan to the Loan Fee specified in section (3) of this rule. If the loan does not close, the Commitment Fee will not be refunded.

(3) The applicant, immediately upon the loan closing, shall pay to the Department a Loan Fee of one and one-half percent (1.5%) of the approved amount of the loan. The amount collected by the Department will be reduced by the amount of the Commitment Fee collected as provided for in section (2) of this rule. If the full amount of the loan is not disbursed, the Loan Fee will not be refunded.

(4) The Department may charge and collect a non-refundable Modification Fee of up to $500 at the time that it receives a loan modification request. A loan modification may include, but, is not limited to, modification to terms of repayment, subordination requests, or changes to the collateral or the guarantees. In addition the borrower will be responsible for payment of, separate and above any other amounts owed on the loan, closing costs associated with the modification including, but not limited to, document preparation, review of documentation for legal sufficiency, title, and escrow, recording or filing fees.

(5) Monies referred to in (1), (2), (3) and (4) of this rule, not including closing costs, shall be paid into the Fund.

(6) The Department may, in its sole discretion, use some or all of the money collected under section (3) of this rule, as payment to a contracted Local Development Group for referring projects for financing, packaging the loans, processing applications, investigating proposed business development projects and servicing outstanding loans. In no case shall the Department make any payment of more than one percent (1%) of the loan principal amount for any one project. In no case shall the Department make any payment under this section until the loan has been closed and the Department has collected in full the fee specified in section (3) of this rule.

History

Statutory/Other Authority: ORS 285B.092, ORS 285A.075, OL Ch 71 2018 & ORS 285A.200(3)
Statutes/Other Implemented: ORS 285A.075, OL Ch 71 2018 & ORS 285A.200(3)
OBDD 6-2023, temporary amend filed 04/12/2023, effective 04/12/2023 through 10/08/2023
OBDD 4-2020, amend filed 04/03/2020, effective 04/03/2020
OBDD 13-2019, amend filed 09/04/2019, effective 09/04/2019
OBDD 2-2019, adopt filed 01/07/2019, effective 01/07/2019

Division 95 INDUSTRY COMPETITIVENESS FUND

Or. Admin. R. 123-095-0000 Purpose and Objectives

The purpose of this division of administrative rules is to govern the use of funds in the Industry Competitiveness Fund established by ORS 285B.290.

History

Statutory/Other Authority: ORS 285A.075(5) & 285A.110
Statutes/Other Implemented: ORS 285B.286 & 285B.290
OBDD 11-2013, f. 11-26-13, cert. ef. 12-1-13
OBDD 8-2013(Temp), f. & cert. ef. 10-4-13 thru 4-2-14
EDD 1-2000, f. & cert. ef. 1-13-00
EDD 1-1993, f. & cert. ef. 1-15-93
EDD 4-1992(Temp), f. & cert. ef. 3-18-92

Or. Admin. R. 123-095-0010 Definitions

For the purposes of these rules, additional definitions may be found in Procedural Rules OAR 123-001. The following terms shall have the following meaning, unless the context clearly indicates  otherwise:

(1) "Project" means an activity that contributes to the stability, growth, development, or competitiveness of a Traded Sector Industry, or group of Traded Sector Industries.

(2) "Traded Sector Industry" means an Oregon industry whose members sell their goods or services into markets for which national or international competition exists.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.286
OBDD 11-2013, f. 11-26-13, cert. ef. 12-1-13
OBDD 8-2013(Temp), f. & cert. ef. 10-4-13 thru 4-2-14
EDD 1-2000, f. & cert. ef. 1-13-00
EDD 1-1993, f. & cert. ef. 1-15-93
EDD 4-1992(Temp), f. & cert. ef. 3-18-92

Or. Admin. R. 123-095-0030 Eligible and Non-Eligible Activities

(1) Funds in the Industry Competitiveness Fund may be used by Department to:

(a) provide grants for Projects. Examples of a Project include, but are not limited to, the following activities:

(A) Assisting a Traded Sector Industry(ies) in establishing research and development consortia;

(B) Introducing new products into an existing market or developing new markets for a Traded Sector Industry(ies) or businesses within a Traded Sector Industry;

(D) Increasing the skills of workers to meet the needs of a Traded Sector Industry(ies);

(E) Enhancing the capacity of a Traded Sector Industry(ies) to take advantage of electronic communications and information technologies; and

(F) Increasing the global competitiveness of a Traded Sector Industry(ies);

(G) Activities that are prerequisite to and will lead to the implementation of any of the above (such as preparing an application for federal grant funds for one or more of the above activities); and

(H) Assisting in organizing focus groups or other meetings and conducting research to identify issues and needs of a Traded Sector Industry(ies) and developing strategies to address those needs and issues; and

(b) Directly purchase goods and services which contribute to the stability, growth, development or competitiveness of a Traded Sector Industry(ies).

(2) Funds in the Industry Competitiveness Fund may not be used for:

(a) Any activity that requires continuing subsidies from the State of Oregon; or

(b) Ongoing administrative expenses.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.286 & 285B.290
OBDD 6-2015, f. & cert. ef. 8-4-15
OBDD 11-2013, f. 11-26-13, cert. ef. 12-1-13
OBDD 8-2013(Temp), f. & cert. ef. 10-4-13 thru 4-2-14
EDD 1-2000, f. & cert. ef. 1-13-00
EDD 1-1993, f. & cert. ef. 1-15-93
EDD 4-1992(Temp), f. & cert. ef. 3-18-92

Or. Admin. R. 123-095-0035 Award Requirements

A Project which is financed through an Industry Competitiveness Fund grant must meet the following criteria:

(1) Individual businesses in the Traded Sector Industry(ies) must be involved in planning the Project or Department must determine that the nature of the Project results in this involvement being unfeasible or in some other manner not applicable;

(2) The grant from the Industry Competitiveness Fund must not represent more than 50% of the total cash cost of the Project;

(3) Private sector funds used to cover cash expenses for the Project must be at least equal to the amount of the grant from the Industry Competitiveness Fund;

(4) Compliance with this division of administrative rule and ORS 285B.286 and 285B.290 does not entitle a Project to a grant from the Industry Competitiveness Fund.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.286 & 285B.290
OBDD 6-2015, f. & cert. ef. 8-4-15
OBDD 11-2013, f. 11-26-13, cert. ef. 12-1-13
OBDD 8-2013(Temp), f. & cert. ef. 10-4-13 thru 4-2-14

Or. Admin. R. 123-095-0040 Administration of Awards

(1) Upon approval of a grant for a Project, Department will enter into an agreement with the entity responsible for completing the Project. The agreement will, as applicable, include, but is not limited to, the following:

(a) A description of the Project;

(b) Procedures and conditions for disbursing the grant moneys from the Industry Competitiveness Fund;

(c) A requirement that private sector funds used to cover cash expenses for the Project must be at least equal to the amount of the grant from the Industry Competitiveness Fund;

(d) A requirement that the grant from the Industry Competitiveness Fund may not exceed 50% of the total cash cost of the Project;

(e) A requirement that a sign be conspicuously displayed at the site of the Project or a statement included on written documents produced as a result of the Project which indicates the Project is being funded with Oregon State Lottery Funds, administered by Department;

(f) Reporting requirement(s); and

(g) Other provisions deemed necessary by Department.

(2) Upon approval of using Industry Competitiveness Fund moneys in accordance with 123-095-0020(1)(b), Department will procure the goods and services in accordance with OAR 123 division 6, Procedures for Contracts Entered with the Business Development Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285B.286 & 285B.290
OBDD 6-2015, f. & cert. ef. 8-4-15
OBDD 11-2013, f. 11-26-13, cert. ef. 12-1-13
OBDD 8-2013(Temp), f. & cert. ef. 10-4-13 thru 4-2-14
EDD 1-2000, f. & cert. ef. 1-13-00
EDD 1-1993, f. & cert. ef. 1-15-93
EDD 4-1992(Temp), f. & cert. ef. 3-18-92

Division 97 INDUSTRIAL SITE READINESS

Or. Admin. R. 123-097-0100 Purpose

This division of administrative rules establishes procedures and standards for the designation of regionally significant industrial sites and the qualification of sponsors, which become the basis of tax reimbursement arrangements to assist public entities to develop such sites.

History

Statutory/Other Authority: 285B.626(1) & (9), 285B.627 (2), (3), (10), 285B.630(7) & ORS 285A.075
Statutes/Other Implemented: ORS 285B.625 - 285B.632
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary amend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-0200 Definitions

ORS 285B.626 and OAR 123-001 (Procedural Rules) contain definitions used in this division of administrative rules. In addition, unless the context requires otherwise:

(1) “Development Agreement” means a contract whereby a public entity invests public money to prepare a privately owned RSIS for industrial use.

(2) “Eligible Employer” means an employer that is conducting a traded-sector business on a regionally significant industrial site; and

(a) With respect to a rural site, has hired at least 25 full-time employees whose wages average at least 150 percent of the county or state average wage, whichever is less; or

(b) With respect to an urban site, has hired at least 50 full-time employees whose wages average at least 150 percent of the county or state average wage, whichever is less.

(3) “Employee” means a person employed by an eligible employer to perform work located on the RSIS.

(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 traded-sector goods or services.

(5) “Public owner” and “public entity” mean all local governments as that term is defined in ORS 174.116, and federally recognized Indian Tribes in Oregon.

(6) “RSIS” means a regionally significant industrial site designated under 123-097-0500.

(7) “Rural site” means a RSIS located outside the acknowledged Portland Metropolitan Area Regional Urban Growth Boundary and the acknowledged urban growth boundaries of cities with populations of 30,000 or more.

(8) “Sponsor” (“project sponsor” under ORS 285B.625-.632) means a public owner of a RSIS that is investing in preparation of the site for industrial use by a third party, or a public entity that has entered into a Development Agreement to prepare a privately owned site for industrial use.

(9) “Tax year,” as used in ORS 285B.626, 285B.627 and 285B.630, means the calendar year over which an eligible employer pays taxable income to its employees working on the RSIS.

(10) “Tax Reimbursement Agreement” means a binding contract between the Department and a Sponsor, under which the Sponsor may receive reimbursement for RSIS preparation costs from estimated incremental income tax revenues generated by employees working on the RSIS.

(11) “Traded-Sector Business” has the meaning given that term in ORS 285A.010.

(12) “Urban site” means a RSIS located within the acknowledged Portland Metropolitan Area Regional Urban Growth Boundary and the acknowledged urban growth boundaries of cities with populations of 30,000 or more.

(13) “Wages” mean payments made to an individual for personal services and the cash value of all compensation to that individual in any medium other than cash, as reported by employers on the Oregon Quarterly Tax Report required by law.

History

Statutory/Other Authority: ORS 285A.075, 285B.627 (2), (3), (7), (10), 285B.630(7) & 285B.626(1) & (9)
Statutes/Other Implemented: ORS 285B.625 - 285B.632
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-0500 Regionally Significant Industrial Site Designation

(1) For an industrial site to be designated as a RSIS, the Department must find that the proposed site is one of the following:

(a) Land, which may comprise one or more tax lots or sites, entirely within a “regionally significant industrial area” established under Metro Code Chapter 3.07.420 by Metro, the metropolitan service district for the Portland region established under ORS chapter 268.

(b) Land not within a Metro-designated regionally significant industrial area, which may comprise one or more tax lots or sites, that:

(A) Is 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 provide significant competitive advantages that are difficult or impossible to replicate in the region; and

(C) Has, or will have with site preparation, 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, adequate to support the Sponsor’s economic development strategy for the site.

(2) The documentation for a proposed RSIS, in the application required by 123-097-1500, must:

(a) fully identify the site, including maps, legal property description and tax lots;

(b) describe how the site is inside the applicant’s jurisdiction, territory or urban growth boundary;

(d) verify the current ownership and title to the land with a preliminary title report or the equivalent;

(e) list all real property encumbrances, easements, liens and restrictions, and describe their potential to interfere with development for industrial use;

(f) list all applicable laws or permits affecting development for industrial use;

(g) describe existing site conditions and practical constraints on development for industrial use; and

(h) confirm that the site is zoned for industrial use.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627(2)(a) & (10)
Statutes/Other Implemented: ORS 285B.625, 285B.626 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-1000 Sponsor Qualification

(1) Criteria the Department will consider when determining Sponsor qualification are:

(a) Whether the applicant has or will have the financial, material, equipment, facility and personnel resources and expertise, or has the ability to obtain the resources and expertise, necessary to implement its proposed economic development strategy for the site.

(b) The applicant’s record of performance on similar site preparation and economic development strategies for such sites, considering the extent that performance remained within the applicant’s control.

(c) The record of integrity for an applicant’s executive staff and governing body, regarding matters related to the entity’s operations.

(d) The economic development strategy for the RSIS.

(2) An applicant to become a Sponsor must submit materials to the Department according to 123-097-1500, that:

(a) Includes the Sponsor’s economic development strategy for the site.

(b) Lists all parties involved in site preparation activities, including underwriters, and other private or public investors.

(c) Describe planned or completed site preparation improvements, an estimated timeframe for the improvements from start to completion, and the actual or budgeted costs for such improvements.

(d) Provide estimated employment at the proposed RSIS once the site is developed to its planned full capacity.

(e) Outline local workforce characteristics and workforce development programs existing or planned to support the site’s development.

(f) Include any of the following materials that exist: drafts or final versions of a site preparation assessment, site master plans, wetland mitigation or avoidance plans, archeological surveys, transportation improvement plans, environmental assessments and remediation plans, any pre-permits or permits needed or obtained, any resolutions and ordinances passed by local governments, and any other related documentation of the site’s preparation and development.

(g) If the proposed RSIS has a private owner who owns all or portions of the property comprising the site or rights critical to its re/development, the application must also include an executed Development Agreement between the Sponsor and the private owner or the owner’s developer, demonstrating:

(A) The responsibilities of the respective parties for performing and paying for site preparation, construction, and infrastructure requirements for the proposed RSIS; and satisfying land use requirements; and

(B) The Sponsor’s and private owner or developer’s plan to operate as a traded-sector industrial use employer, or a commitment to make the proposed RSIS available for purchase, lease or exchange to an employer for traded-sector industrial use.

(h) Supplemental information as requested by the Department.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627 (3), (4) & 10)
Statutes/Other Implemented: ORS 285B.625, 285B.626 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-1500 Application and Approval Process

(1) Applications for designation as a Regionally Significant Industrial Site and for qualification as a Sponsor are combined, and must be submitted on a form prescribed by the Department and according to any instructions provided by the Department.

(2) In its review, the Department may:

(a) Consult with the Governor’s Regional Solutions Team and other state agency staff as appropriate; and

(b) Seek to resolve deficiencies or questions in writing with the Sponsor to ensure application completeness.

(3) After receiving an application and such other information as the Department determines necessary to constitute a complete application, the Department will submit a memorandum to its Director for RSIS designation and Sponsor qualification, or denial. The Department may restrict or make its approval subject to specific conditions. The Director’s decision will be final.

(4) If denied, the Department will provide a letter to the applicant detailing reasons for the denial. The applicant may resubmit a revised application once any deficiencies are cured.

(5) Following approval, a Sponsor may, at any time, request a tax reimbursement agreement under 123-097-3000.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627 (3), (4) &10)
Statutes/Other Implemented: ORS 285B.625, 285B.626 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-2000 Eligible and Ineligible Site Preparation Costs

(1) As an overall requirement, all RSIS preparation activities and costs must be incurred in compliance with all applicable laws and regulations, including but not limited to prevailing wage rates, public procurement laws, land use laws, local development regulations, and municipal audit and budgeting procedures; as well as applicable contracts and regulatory agreements, for example, a brownfields remediation plan.

(2) The Department will transfer funds under a tax reimbursement agreement for costs incurred by and billed to the Sponsor and as reimbursement for costs already paid. All reporting of RSIS preparation activities and costs to the Department must be accompanied by written evidence of materials and labor furnished or work performed, itemized receipts or invoices for payment, and releases, satisfactions or other signed statements or forms as the Department may require.

(3) ELIGIBLE COSTS. The costs of goods, materials, services including planning and engineering services, construction, permits and fees, and use rights for all following activities necessary and reasonably related to preparing a RSIS are eligible costs:

Assembly and consolidation of parcels comprising the RSIS, including real property activities such as surveying, real estate, legal, title, insurance, lot adjustment acquisition or sale of parcels, easements, or rights of way.

(b) Making the ground suitable for new construction or reconstruction including but not limited to the demolition and removal of existing buildings and structures, clearing brush, disposal of materials, geotechnical testing, pilings, drainage, drilling, blasting, fill, or grading.

(c) Electricity, natural gas or telecommunications services that are located on or near and directly serve the RSIS and are necessary and reasonable for operations on the site, and to the extent they can be allocated to the site.

(d) Water, sanitary sewer or storm sewer services that directly serve the RSIS.

(e) Transportation improvements of all kinds that directly serve the RSIS.

(f) Development fees imposed by another government, such as systems development charges.

(g) Environmental activities to remediate, remove, protect, preserve or mitigate: natural resources, archaeological and cultural resources, or environmental concerns or hazards; including purchase of off-site wetland mitigation credits.

(h) Financing costs, including interest, fees and associated expenses.

(i) Other activities and costs determined by the Department to be necessary and reasonably related to preparing a RSIS, and to the extent they can be allocated to the site.

(4) INELIGIBLE COSTS. Notwithstanding section (3) of this rule, the following activities and costs are not eligible costs:

(a) Costs already paid or under agreement to be paid from a source other than the Sponsor’s funds.

(b) Costs of vehicles or equipment or labor not directly related to the RSIS.

(d) Penalties or fines.

(e) Costs related to site preparation activities for an employer that arise after that employer begins operations.

(f) Costs related to any pre-existing employers operating on the site prior to site designation and Sponsor certification.

(g) Environmental remediation activities at a RSIS listed or proposed to be listed under CERCLA (42 U.S.C. 9605) if any of the Sponsor, private owner, or eligible employer are liable under CERCLA for that RSIS.

(h) Construction, repair, remediation or improvements to buildings, fixtures and furnishings.

(i) Administration and management costs of the Sponsor or private owners.

(j) Costs not described in an approved Sponsor application; see 123-097-1000 (2)(c).

History

Statutory/Other Authority: ORS 285A.075 & 285B.627(7) & (10)
Statutes/Other Implemented: ORS 285B.625, 285B.626 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-2200 Sponsor Responsibilities

(1) The Sponsor shall:

(a) Maintain accounts and records for all activities and expenditures associated with preparation of a RSIS, giving the Department and its representatives reasonable access to such records.

(b) Ensure that service providers retained for their professional expertise are certified, licensed, or registered, as appropriate or necessary in the State of Oregon for their specialty.

(c) Follow standard construction practices, such as requiring bonding, applicable insurance, inspections, use of as-built drawings, and comply with applicable Oregon labor standards and prevailing wage laws.

(d) Comply with the Oregon Public Contracting Code (ORS chapters 279A, B, C).

(c) Follow standard construction practices, such as requiring bonding, applicable insurance, inspections, use of as-built drawings, and so forth on the Project.

(d) Devise plans as necessary for the ongoing operation, maintenance and upgrade of infrastructure and remediation work that will preserve their benefits over their normally useful life.

(e) Guarantee that the RSIS will remain zoned for industrial use for not less than 20 years from when the Loan Agreement or TRA is executed.

(f) Actively participate with eligible employers in timely submitting annual reports as required in OAR 123-097-2600.

(2) For purposes of requisite signage posted at the RSIS and visible to the generally public, which the department may furnish, as well as all plans, bids, advertisement and other documents for the Project:

(a) The sponsor shall see that they prominently bear the statement, “Project supported through the Oregon Industrial Site Readiness Program Fund, administered by the State of Oregon Business Development Department.”

(b) In the event that a Loan Agreement is in effect funded with state lottery proceeds used to capitalize the Oregon Industrial Site Readiness Program Fund under ORS 285B.632, the sponsor shall also comply with ORS 280.518 requiring public display of information on lottery funding, including that the statement in subsection (a) of this section also says, “..., and funded by Oregon State Lottery proceeds.”

(3) Responsibilities contained in this rule may affect the sponsor’s receipt of Program loan award, loan forgiveness or tax reimbursements whether or not confirmed in the TRA or Loan Agreement, which may specify additional responsibilities.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627(4) & (10)
Statutes/Other Implemented: ORS 285B.625 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-2500 Determination of eligible costs and estimated incremental income tax revenues

(1) Once a RSIS has been designated and a Sponsor has been certified and a tax reimbursement agreement is established, the Sponsor must submit the following information to the Department by Jan 1 of each year, starting the tax year after an employer hires employees:

(a) A complete list of any employers, including their business identification numbers, conducting traded-sector business on the designated RSIS during the previous year.

(b) A complete list and description of any site preparation costs incurred during the previous year; see 123-097-1000 (2)(c).

(2) The Department will determine:

(a) Which employers are conducting a traded sector business according to ORS 285A.010.

(b) Which employers have met the ORS 285B.626(1)(b) threshold requirements by examining the 50 (urban site) or 25 (rural site) highest-paid employees, averaging the wages of those individuals, then comparing that figure to the threshold of 150 percent of the state or county wage average wage, whichever is less.

(3) For each tax year, the Department will calculate the estimated incremental income tax revenues at the RSIS based on the following:

(a) Wages and hours data received from the Oregon Employment Department as reported by employers on the Oregon Quarterly Tax Report required by law. Missing information for a tax year will be included in the following tax year.

(b) Individual employees will be placed into assumed tax brackets, based on actual hours worked and wages paid.

(c) Assumed tax rates times actual wages paid will be calculated for individual employees, then summed for each employer.

(4) For each tax year, the Department shall notify Sponsor of the amount to be transferred to the Sponsor under a tax reimbursement agreement, and the balance of site preparation costs to be carried over to subsequent tax years.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627(10)
Statutes/Other Implemented: ORS 285B.625, 285B.626, 285B.627 & 285B.630
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-097-3000 Tax Reimbursement Arrangements

For purposes of a tax reimbursement agreement under ORS 285B.627(5)(a):

(1) After a request from a qualified Sponsor, the Department may establish a tax reimbursement agreement to reimburse the Sponsor’s eligible RSIS preparation costs. The tax reimbursement agreement will remain in effect until the Sponsor’s total eligible costs covered by the agreement have been reimbursed, or otherwise terminated according to the terms of the agreement.

(2) In its request for the tax reimbursement agreement the Sponsor must specify its planned site preparation costs, all sources of funds for those costs, and a schedule for expenditures. The agreement will specify the types and amounts of costs authorized, which may not be exceeded except by amendment to the agreement.

(3) Reimbursements to the Sponsor in any tax year are subject to:

(a) The reasonable judgment of the Department that it has sufficient moneys in the Oregon Industrial Site Readiness Program Fund and has sufficient appropriations, limitations, allotments and other expenditure authority to make the disbursement.

(b) The limitation in ORS 285B.627(8) whereby the Department may not exceed $10 million in reimbursements to all Sponsors in one year. Any amounts otherwise due but for this limitation will be deferred and remain eligible in future years. If the limitation becomes applicable, the Department will provide a proportionate share to each sponsor based on the estimated incremental income tax revenues for each RSIS for that year.

(4) The tax reimbursement agreement will contain provisions the Department determines necessary or appropriate.

History

Statutory/Other Authority: ORS 285A.075 & 285B.627(10)
Statutes/Other Implemented: ORS 285B.625 & 285B.627
OBDD 11-2018, amend filed 04/17/2018, effective 04/17/2018
OBDD 4-2017, temporary suspend filed 11/28/2017, effective 11/28/2017 through 05/25/2018
OBDD 9-2014, f. 4-30-14, cert. ef. 5-1-14

Division 98 INDUSTRIAL SITE READINESS ASSESSMENT PROGRAM

Or. Admin. R. 123-098-0010 Purpose

This division of administrative rules establishes standards and criteria for the approval of grants related to the Industrial Site Readiness Assessment Program (“Program”) to evaluate regional industrial land inventories.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0020 Definitions

ORS 285B.636 and OAR 123-001 (Procedural Rules) contain definitions used in this division of administrative rules. In addition, unless the context requires otherwise:

(1) “Private owner,” as used in ORS 285B.626(5)(b), means one or more persons, businesses or nongovernmental organizations that hold clear and lawful title to RSIS property, even if not owning it outright, and subject to the department’s acceptance, it may mean a private developer with total and direct legal authority for the improvement and disposition of the property from the actual private owner.

(2) “Public entity” as used in ORS 285B.626(5)(b), means a government or agency of a:

(a) Local service district under ORS 174.116(2) that has a general and abiding interest in the re/development of land within its territory for industrial use and employment, such as a port, airport or county service district; or

(b) City, county or federally recognized Indian Tribe in Oregon, but excluding organizations under ORS chapter 190.

(3) “Public owner,” as used in ORS 285B.626(5)(a), means any Tribe, local government or local service district in Oregon that owns all of the Regionally Significant Industrial Site (RSIS).

(4) “Development agreement” means an agreement between the private owner and the public entity, defining the project(s), requirements, and responsibilities to develop the project to “market ready”.

(5) “Due diligence assessment” means an assessment of the actions, costs and time frames involved in bringing regionally significant industrial sites to market-ready status.

(6) “RSIA” means a Regionally Significant Industrial Area designated as such by:

(a) The Economic Recovery Review Council under ORS 197.723, as described in or proposed for OAR 966; or

(b) The Metro Council for regulation under Title 4 of Metro’s Urban Growth Management Functional Plan, Metro Code Chapter 3.07.

(7) “Regionally Significant Industrial Site” (RSIS) means a site as defined under ORS 285B.626(6), that has been certified per OAR 123-097-0500, and for which all or portions of the property belong to the sponsor as a public owner or to one or more private owners, with whom the sponsor has entered into agreement.

(8) “Regional Solutions Team” means interagency teams established by the Governor for defined regions within the state comprised of representative from each of the Department of Environmental Quality (DEQ), the Department of Land Conservation and Development (DLCD), the Department of Transportation (ODOT), the Department of Housing and Community Services (OHCS), and the Business Development Department (OBDD). The teams are led by a Regional Coordinator who represents the Governor as a catalyst for action in each region.

(9) “Regional industrial land inventory” means an inventory of regionally significant industrial sites in a region that identifies development-related constraints and opportunities to develop the regionally significant industrial sites and that rates the sites based on market readiness.

(10) “Willing Property Owner” means a public or private property owner that is committed to bringing a RSIS to market-readiness and pursuing development of the site for industrial use.

(11) “Market-ready” means that a RSIS has been issued all appropriate and necessary development permits.

History

Statutory/Other Authority: ORS 285A.075, 285B.626 & 285B.635 — 285B.642
Statutes/Other Implemented: ORS 285B.636
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0030 Eligible Economic Development Districts

“Economic development district” means one of the following:

(1) The Affiliated Tribes of Northwest Indians Economic Development Corporation, serving tribal members of the Burns-Paiute Tribe, the Confederated Tribes of Coos, Lower Umpqua and Siuslaw Indians, the Confederated Tribes of Grand Ronde, the Confederated Tribes of Siletz Indians, the Confederated Tribes of the Umatilla Indian Reservation, the Confederated Tribes of the Warm Springs Reservation of Oregon, the Coquille Indian Tribe, the Cow Creek Band of Umpqua Tribe of Indians and the Klamath Tribes.

(2) The Cascades West Economic Development District, serving Benton, Lane, Lincoln and Linn

(3) The Columbia-Pacific Economic Development District, serving Clatsop, Columbia and Tillamook Counties and western Washington County.

(4) The CCD Business Development Corporation, serving Coos, Curry and Douglas Counties.

(5) The Greater Eastern Oregon Development Corporation, serving Gilliam, Grant, Morrow, Umatilla, Wheeler, Harney and Malheur Counties.

(6) The Central Oregon Intergovernmental Council, serving Crook, Deschutes and Jefferson Counties.

(7) The Mid-Columbia Economic Development District, serving Hood River, Wasco and Sherman Counties.

(8) The Mid-Willamette Valley Council of Governments, serving Marion, Polk and Yamhill Counties.

(9) The South Central Oregon Economic Development District, serving Lake and Klamath Counties.

(10) The Northeast Oregon Economic Development District serving Baker, Union and Wallowa Counties.

(11) Southern Oregon Regional Economic Development, Inc., serving Jackson and Josephine Counties.

(12) Greater Portland, Inc., Portland-Vancouver Economic Development District, serving Multnomah, Clackamas and Washington Counties.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0040 Site Assessment and Development Plan Grants

(1) As funds are available, the Department will provide grants on a competitive basis to: Public owners of RSIS or public entities that have entered into development agreements or other agreements with private owners with respect to RSIS, to perform due diligence assessments, define development-related constraints and create detailed development plans to move the site(s) toward a state of market-readiness.

(2) Regionally significant industrial sites (RSIS) include;

(a) Sites identified within designated Regional Significant Industrial Areas (RSIA); or

(b) Sites considered and designated by the Department from nominations by Public Entity. Nominations may be submitted at any time, considered in order received, within the following criteria and requirements:

(A) Contains site or sites, including brownfields and “Decision Ready” sites, that are suitable for the location of new industrial uses or the expansion of existing industrial uses and 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;

(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;

(D) Public Entity has entered into Development Agreement with the property owner (public or private);

(E) Property is available for sale or lease, and listed on Oregon’s site selection service;

(F) Specifically identified in the Regional Solutions Team project list or priorities; and

(G) The nomination request will be considered by Department staff and Regional Solutions Team, who will complete a staff report and respond to Public Entity with written decision within 45 days of receipt of the nomination.

(3) Grant awards will based on the following factors:

(a) Availability of appropriated funds;

(b) Total program not to exceed 80 percent of annual allocation;

(c) Public Entity grant not to exceed the lesser of $100,000 per site or amount established in annual program guidelines;

(d) Assessments and development plans that contribute towards “Certified Industrial Site” designation;

(e) Receipt of complete application form provided by Department that includes at a minimum: Public Entity applicant information, copy of property listing, map of proposed RSIS, sponsor agreements, scope of work and budget estimate, consultation with Regional Solution Team(s), and contact information; and

(f) Department reserves the right to prioritize sites and assessments proposed in the application to meet fund limitations and State or Regional priorities.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0050 Regional Inventory/Assessment, and Regional Planning Grants

(1) As funds are available, the Department will provide grants to conduct regional industrial land inventories, assess site development costs, prioritize regionally significant industrial sites, and evaluate market-ready status of industrial sites, to: Economic Development Districts as defined in 123-098-0030 that are committed and have the ability to perform regional industrial land inventories for a specific region and/or prioritize regionally significant industrial sites in a region for due diligence assessment and site preparation costs.

(2) Grant awards will be based on the following factors:

(a) Availability of appropriated funds;

(b) Total not to exceed 20 percent of annual program allocation;

(c) Individual Economic Development District grant not to exceed the lesser of $50,000 or amount established in annual program guidelines;

(d) Receipt of complete application form provided by Department that includes at a minimum: Public Entity applicant information, list of existing relevant studies, scope of work and budget estimate, participating Public Entities, cooperating agreements, budget and in-kind match, public involvement and support, consultation with Regional Solution Team(s), and contact information; and

(e) Department reserves the right to modify scope and assessments proposed in the application to meet fund limitations and State or Regional priorities.

(3) Matching fund requirement to be set by the Department in annual application guidelines.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0060 Uncommitted Annual Program Allocation

Uncommitted funds from annual allocations will be added to the following annual allocation and made available in procedures defined within these rules.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Or. Admin. R. 123-098-0070 Reporting

(1) Copies of final reports to be submitted to the Department within 30 days of receipt by Public Entity; and

(2) Annual progress report from Public Entity of all activities conducted or completed by program funding, and current budget to be submitted to Department within 60 days following the end of the Fiscal Year.

History

Statutory/Other Authority: ORS 285A.075 & 285B.635-285B.642
Statutes/Other Implemented: ORS 285B.635-285B.642
OBDD 8-2014, f. 4-30-14, cert. ef. 5-1-14

Division 99 INDUSTRIAL LANDS LOAN FUND

Or. Admin. R. 123-099-0010 Purpose

The purpose of these rules is to establish the Industrial Lands Loan Fund required by the 82nd Oregon Legislative Assembly, 2023 Regular Session, passed chapter 25, sections 14 to 23, Oregon Laws 2023 (Enrolled Senate Bill 4). The scope of these rules includes requirements to administer and implement the Semiconductor Industrial Lands Loan Program (“Program”) developed by the Department for the state to make financial assistance awards in the form of a repayable or forgivable loan to fund development projects, including planning projects. These rules are designed to support private and public investment in industrial lands development projects associated with new or expanded semiconductor industry uses.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25, § 15.
Statutes/Other Implemented: OR Laws 2023 ch. 25, § 15. & OR Laws 2023 ch. 25 §§14-23
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0020 Definitions

(1) “Act” means Chapter 25, sections 14 to 23, Oregon Laws 2023.

(2) “Agreement” means a program repayable or forgivable loan contract between the Department and a Project Sponsor for an approved application that provides for the award amount from the Industrial Lands Loan Fund and the terms of the contract.

(3) “Application” means the Department-prescribed form that an applicant submits to propose a project and to request a Program repayable or forgivable loan.

(4) “Brownfield” has the meaning given that term in ORS 285A.185.

(5) “Department” means the Oregon Business Development Department.

(6) “Development project” has the meaning given that term in chapter 25, section 14(3), Oregon Laws 2023.

(7) “Eligible project” means a development project or a planning project.

(8) “Financial assistance” means a repayable loan or a forgivable loan.

(9) “Environmental action” has the meaning given that term in ORS 285A.188.

(10) “Industrial land” has the meaning given that term in chapter 25, section 14(6), Oregon Laws 2023.

(11) “Industrial land development project” means a project for the acquisition, improvement, construction, demolition or redevelopment of publicly or privately owned utilities, buildings, land, transportation facilities or other facilities that assist the economic and community development of a municipality on land planned and zoned for industrial use.

(12) “Planning project” has the meaning given that term in chapter 25, section 14(7), Oregon Laws 2023.

(13) “Program” means the Semiconductor Industrial Lands Loan Program created by the Act that is authorized to provide certain repayable and forgivable loans.

(14) “Private owner” has the meaning given that term in chapter 25, section 14(8), Oregon Laws 2023.

(15) “Project sponsor” has the meaning given that term in chapter 25, section 14(9), Oregon Laws 2023.

(16) “Semiconductor industry use” has the meaning given that term in chapter 25, section 14(11), Oregon Laws 2023.

(17) “Public entity” has the meaning given that term in chapter 25, section 14(10), Oregon Laws 2023.

(18) “Utilities” means broadband, electric power, natural gas, water service, sewer service, and any renewable energy source.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25, § 15
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §§14-23
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0030 Project and Applicant Eligibility

(1) An applicant seeking a forgivable loan for a planning project under Section 16, chapter 25, 2023 Oregon Laws, must demonstrate in the Program application that the proposed planning project, as that term is defined, is an eligible project under the Act.

(2) An applicant seeking financial assistance for a development project under Section 15, chapter 25, 2023 Oregon Laws, must demonstrate in the Program application that the proposed project is an industrial land development project as that term is defined in OAR 123-099-0020(11) and is an eligible project under the Act.

(3) To comply with this rule, an applicant must demonstrate in the application to the Department’s satisfaction that the proposed project is suitable for new semiconductor industry uses, or the expansion of existing semiconductor industry uses that could reasonably provide significant additional employment in Oregon. When reviewing and evaluating Program applications for compliance with this requirement, the Department shall give preferences to projects that can demonstrate a reasonable likeliness to:

(a) Aid in the addition of at least 100 additional semiconductor industry jobs in Oregon; or

(b) Aid in the addition of at least 1 additional semiconductor industry job in Oregon per $45,000 of Program financial assistance provided.

(4) To comply with this rule, an applicant must demonstrate in the application the proposed project has:

(a) Land characteristics that provide significant competitive advantages that are difficult or impossible to replicate;

(b) 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;

(c) Land zoned for industrial use that is located within 50 miles from present semiconductor industry clusters in Oregon (i.e. Corvallis, Eugene, Gresham, Hillsboro, Medford and Redmond). The Department presumes that such locations provide significant competitive advantages that are difficult or impossible to replicate and have access to the requisite transportation and freight infrastructure.

(5) Applicant eligibility

(a) An applicant must demonstrate eligibility by detailing how the public entity or private owner meets the requirements of a Project Sponsor.

(b) For the Department to confirm eligibility, a private owner applicant must provide within or attached to its application either:

(A) evidence to the Department’s satisfaction of the private entity’s investment in the preparation of the industrial land for a development project by a third party; or

(B) a copy of the agreement entered into with a public entity for the development of public infrastructure to serve their privately owned site.

(c) For the Department to confirm eligibility, a public entity applicant must provide within or attached to its application either:

(A) evidence to the Department’s satisfaction of the public entity’s ownership of industrial land that the public entity is investing in for a development project by a third party; or

(B) the public entity’s development or other agreement with a private owner of industrial land to prepare the land for a development project.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25, § 15
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0040 Application Review and Approval

The Department shall review all timely and complete applications for Program financial assistance. The Department’s review shall include:

(a) Review of proposed projects for determination of compliance with eligible uses of program funds and loan proceeds as provided by sections 14 to 23, chapter 25, Oregon Laws 2023, and as further defined by this division of rules;

(b) Review of application for determination of applicant’s eligibility as a Project Sponsor as that term is defined;

(c) Review for completion of the application, including satisfaction of requirements provided under section 19, chapter 25, Oregon Laws 2023 and requirements provided by this division of rules;

(d) Consideration of the reasonableness of the Project Sponsor’s estimated costs to prepare the land for industrial use, including, but not limited to, allowable costs for land preparation;

(e) Consideration of the potential economic impacts for the proposed project;

(f) Consideration of each application and the requested amount based on program guidelines and program priorities as determined by the Department. While forgivable loans do not require match, the Department shall give preferences for projects that are not solely funded from the Department’s financial assistance;

(g) Applying the preferences provided by this division of rules; and

(h) Applying any other criteria set forth in the applicable Request for Applications (“RFA”).

(2) Within 30 days of the applicable RFA close date, the Department shall approve or reject program applications.

(3) Approved applicants shall receive a notice of intent to award, and unsuccessful applicants shall receive a letter of explanation from the Department.

(4) As applicable, the notice of intent to award provided to approved applicants shall contain an offer of an amount for a program repayable or forgivable loan for a development project; and/or an offer of an amount for a program forgivable loan for a planning project. The Department may make an offer that is less than what was requested by the applicant. For development projects, the Department shall condition loan awards on satisfactory collateral or other security such as requiring a co-signer or guarantor or other conditions to secure repayment of a loan made. Generally, public entity awards shall be conditioned on a pledge of the entity’s full faith and credit and taxing power within Article XI, sections 11 and 11b of the Oregon Constitution and a pledge of appliable net revenues from the public infrastructure system that is the subject of the public entity’s development project.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25, § 19
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §19
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0050 Forgivable Loan Agreement Conditions

(1) If a Project Sponsor completes a planning project funded by a program forgivable loan by the project completion deadline in accordance with the terms of the Agreement, and provided that no event of default has occurred, the Department shall, 90 days after the project completion date, forgive repayment of the forgivable loan amount and any interest accrued thereon and cancel the forgivable loan.

(2) If a Project Sponsor completes a development project funded by a program forgivable loan by the project completion deadline in accordance with the terms of the Agreement, and fulfills requirements related to the ownership and operation of the project, as determined by the Department, and provided that no event of default has occurred, the Department shall forgive repayment of the forgivable loan amount and any interest accrued thereon and cancel the forgivable loan.

(3) If a Project Sponsor fails to meet the Agreement’s covenant of a term of years for the completed project (not including planning projects) to be directly owned or operated by the Project Sponsor or the subject of a management contract or an operating agreement to which the Project Sponsor is a party, the forgivable loan amount disbursed shall be due and payable in full by the Project Sponsor within 30 days of the appliable change in ownership, operation, management contract or operating agreement by the Project Sponsor.

(4) Noncompliance with performance, including failure to complete the project by the project completion deadline or other conditions set forth in the Agreement shall trigger a forgivable condition default requiring a forgivable loan to be repaid.

(5) The Department may in its discretion allow Project Sponsors to cure noncompliance with performance or other conditions set forth in the Agreement.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §§15, 16
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0060 Agreements

(1) After approval of an application for a program loan award for a Project and conditional notice, the Department shall promptly begin preparation and negotiation of an Agreement with the Project Sponsor. The Department conducts a financial review on approved applications in accordance with prudent lending practices, including ability to service debt if a forgivable condition default requires a forgivable loan to be repaid.

(2) Agreements for program loans:

(a) Shall set the maximum amount of financial assistance (loan amount);

(b) Include a provision that the obligation of the state under the Agreement is contingent on the availability of moneys in the Industrial Lands Loan Fund for the amount of financial assistance;

(c) Shall include a provision that grants the Department a lien on, or a security interest in, collateral to secure repayment of a loan made to the Project Sponsor, in a form and amount determined by the Department;

(d) Shall provide the terms for forgiveness if the program loan is a forgivable loan;

(e) Shall provide terms for loan repayment by the Project Sponsor, including a schedule of payments of principal and interest and the manner for determining when loan payments are delinquent. If the Department determines a Forgivable Loan fails to meet its conditions for forgiveness, loan repayment shall start on December 1 following such determination;

(f) Shall provide terms for repayment of a forgivable loan if the terms and conditions for forgiveness are not met during the term of the loan. Repayment terms may include full repayment and partial repayment obligations, including repayment obligations that are prorated. If a repayment is required, interest shall be imposed on the loan proceeds;

(g) Shall provide for a maturity date for the loan. Forgivable loans for project planning may be made for a term not to exceed 3 years after the Agreement execution date. Forgivable loans for development projects may be made for a term of years not to exceed the useful life of the contracted project or up to 10 years after the Agreement execution date, as agreed to by the Department. Repayable loans for development projects may be made for a term of years not to exceed the useful life of the contracted project or 30 years from the date of project completion, whichever is less;

(h) Shall set an interest rate and start date for interest accrual on the loan that is determined by the Department at the time of award, based on market conditions for similar debt. The Department shall forgive repayment of accrued interest if the terms of forgiveness for a program forgivable loan are met;

(i) May provide for a reasonable extension of the maturity dates provided in the Agreement for making any repayment in emergency or hardship circumstances, if approved by the Department;

(j) Shall include an approved budget for allowable costs of Program funds;

(k) Shall provide terms for loan proceeds disbursements, which shall be made in compliance with the approved budget, and which may be in a single payment or in multiple, conditional payments. The Project Sponsor must submit each disbursement request for the loan on a Department-provided or Department-approved disbursement request form for Department review and approval. Loan proceeds shall be disbursed to approved Project Sponsors:

(A) on an expense reimbursement or costs-incurred basis; or

(B) upon Project Sponsor’s request and approval from the Department, loan proceeds may be disbursed as an advanced payment for approved budgeted costs to be incurred. Advanced payments may be for partial or full amounts of budgeted costs. Expenditure reports and invoices shall be required to verify that any advance payments were used for approved allowable costs;

(l) Shall provide prevailing rate of wage requirements;

(m) Shall provide for a covenant of a term of years for the completed project (not including planning projects) to be directly owned or operated by the Project Sponsor or the subject of a management contract or an operating agreement to which the Project Sponsor is a party;

(n) Shall provide for terms of breach and default of the Agreement and remedies for breach or default, including the right to withhold any amounts otherwise due to the Project Sponsor; and

(o) Shall contain such other terms and conditions as the Department requires.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch. 25
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0070 Records and Data Confidentiality

(1) Data or information regarding a Program applicant, proposed Project, Project Sponsor or Program Project in an application, application attachment, Agreement, semiannual report or related materials or communications provided to the Department shall be public records subject to disclosure, except for data or information that qualifies as a public records exemption under ORS 192.311 to 192.478 (Oregon Public Records Law).

(2) Section (1) of this rule applies notwithstanding a nondisclosure agreement, but such an agreement may nevertheless spell out data or information anticipated to be exempt under the Oregon Public Records Law, including but not limited to trade secrets or confidential information under ORS 192.355(4), as may facilitate obligations under section (3) of this rule.

(3) When providing items referenced in subsection (1) of this rule, it is the applicant or Project Sponsor’s, its agent’s or its representatives’ responsibility to mark data and information that legitimately and specifically qualify for an exemption from disclosure. To designate an item or portion of one as exempt from disclosure, the applicant or Project Sponsor shall:

(a) Clearly identify in the body of the application, application attachment, Agreement, report and other materials only the limited data or information exempt;

(b) Stipulate the Oregon Public Records Law exemption(s) believed to apply; and

(4) The Department shall determine whether data or any information is actually exempt from disclosure and shall redact from disclosure only that data or information.

(5) Applicants and Project Sponsors are advised to consult with their legal counsel regarding disclosure issues. Applicants and Project Sponsors may wish to limit the amount of truly trade secret or other data or information provided only to what is necessary.

History

Statutory/Other Authority: ORS 285A.075
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Or. Admin. R. 123-099-0080 Reporting Requirements

(1) Every Project Sponsor that enters into an Agreement with the Department shall be required to report on project activities, project expenditures, project milestones completed, overall outcomes any other information required by the Department, on forms or in a format prescribed by the Department. The time periods to be covered in each report, and the deadlines for submission shall be determined by the Department on a case by case basis depending upon the nature of the project activities and their schedule, and prescribed in the Agreement. Project activity reports shall be provided every six months from the date of the Agreement is executed until the Agreement is closed reporting on project activity, project expenditures, project milestones completed and overall outcomes unless otherwise modified and agreed to by the Department.

(2) The reporting obligations provided in section (1) cease on the earlier of the date the Agreement expires, the date the Agreement is terminated, or the date the Department has determined that the Project Sponsor has met their contractual obligations to have the loan forgiven or the Project Sponsor has repaid the loan in full.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch. 25 §4
OBDD 33-2023, adopt filed 12/20/2023, effective 12/20/2023

Division 100 INDUSTRIAL SITE LOAN FUND PROGRAM

Or. Admin. R. 123-100-0000 Temporary rule language in effect until 12/18/2026. Purpose and Objectives

The purpose of these rules is to implement the Industrial Site Loan Fund Program (“Program”), established to provide patient capital loans or forgivable loans to eligible Project Sponsors to support Industrial Land development in Oregon. These rules are adopted pursuant to ORS 285B.034 to carry out the provisions of ORS 285B.032 through 285B.046.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0010 Temporary rule language in effect until 12/18/2026. Definitions

(1) “Brownfields” has the meaning given that term in ORS 285A.185.

(2) “Department” means the Oregon Business Development Department.

(3) “Development Project" means a project for the acquisition, improvement, construction, demolition or redevelopment of publicly or privately owned utilities, buildings, land, transportation facilities or other facilities that assist the economic and community development of a municipality including Planning Project activities that are necessary or useful to a Development Project as determined by the Department.

(4) “Fund” means the Industrial Site Loan Fund established by ORS 285B.046.

(5) “Industrial Land” means land planned and zoned for Industrial Use that:

(a) Is suitable for new industrial uses, or the expansion of existing industrial uses, that can provide significant additional employment in Oregon;

(b) Has land characteristics that provide significant competitive advantages that are difficult or impossible to replicate; and

(c) Has 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.

(6) “Industrial Use” means a use that generates income from the production, handling or distribution of goods or services, including goods or services in the traded sector including but not limited to manufacturing, assembly, fabrication, processing, storage, logistics, warehousing, importation, distribution, transshipment and research and development.

(7) “Interest-Carrying Costs” means costs incurred by a project sponsor for amounts borrowed to develop Industrial Land and financing costs, including capitalized interest.

(8) “Planning Project" means:

(a) A Project related to a potential Development Project for preliminary and final land use planning and engineering;

(b) A survey, land investigation or environmental action;

(d) Any activity that the department determines to be necessary or useful in planning for a potential Development Project.

(9) “Private Owner” means a private business entity or property owner that has entered into an agreement with a local jurisdiction for the development of public infrastructure to serve a private site.

(10) “Project” means a Development Project or Planning Project.

(11) “Project Sponsor” means:

(a) A public entity or private owner of Industrial Land that is investing in the preparation of that land 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 Industrial Land to prepare that land for industrial use.

(12) “Public Entity” means:

(a) A city or county in Oregon

(b) A port formed under ORS 777.005 to 777.725

(d) The tribal council of a federally recognized Indian Tribe in this state, or

(e) An airport district established under ORS Chapter 838.

(13) “Retirement of Debt” means debt incurred that is unrelated to the scope of the Project financed with a program award.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0020 Temporary rule language in effect until 12/18/2026. Eligible Project Sponsors

Only Project Sponsors are eligible to receive financial assistance from the Program.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0030 Temporary rule language in effect until 12/18/2026. Eligible Projects and Project Costs

(1) Only Development Projects and Planning Projects are eligible to receive financial assistance under the Program.

(2) To be eligible for financial assistance under the Program, Development Projects must (1) be directly owned and operated by the Project Sponsor or subject to a management contract or an operating agreement to which the Project Sponsor is a party and (2) must occur upon, or directly serve, land zoned for industrial use.

(3) Eligible Development Project costs include:

(a) Property acquisition and assembly costs associated with creating large development parcels, including any easement or right of way directly related to and necessary for a Development Project;

(b) Transportation improvements such as access roads, rail spurs and sidings, marine facility access, airport facilities necessary to provide Industrial Land access, intersections, turning lanes, signals, sidewalks, curbs, transit stops and storm drains;

(d) Natural resource mitigation;

(e) Land grading activities;

(f) Environmental remediation and mitigation activities to remediate Brownfields properties, in accordance with state and federally approved remediation plans;

(g) Direct Project management costs to third party contractors;

(h) Costs of consultant services and expenses;

(i) Construction costs and expenses;

(j) Costs of acquiring off-site property for purposes directly related to a Development Project, including, but not limited to, wetland mitigation, and

(k) Other costs the Department determines to be necessary or useful for the Project.

(l) Pre-award Project costs incurred within 180 days of the Notice of Award.

(m) Interest-Carrying Costs.

(4) A Development Project that consists solely of the purchase or acquisition of land, is only eligible if the land is:

(a) Identified in an applicable land use or capital plan as necessary for a potential Industrial Land Development Project; or

(b) Zoned solely for industrial use.

(5) Eligible Planning Project costs include necessary planning, engineering, legal and other professional services associated with:

(a) The preparation of applications for local, state and federal permits and related administrative costs (e.g. printing, mailing, notary fees). Administrative costs do not include wages for Project Sponsor employees performing Project related job duties.

(b) Carrying out the Project and related administrative costs, (e.g. printing, mailing, notary fees). Administrative costs do not include wages for Project Sponsor employees performing Project related job duties.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0040 Temporary rule language in effect until 12/18/2026. Ineligible Project Costs

Expenses and costs expressly allowed under OAR 123-100-0030 are eligible for reimbursement from the Fund. All other costs are not eligible for reimbursement, including but not limited to:

(1) The payment of penalties or fines;

(2) Environmental remediation activities conducted at an Industrial Land 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 USC 1601 through 9675), for which the Project Sponsor, or any party to the Program financial assistance to which the Project Sponsor is a party, is liable under 42 USC 9607;

(3) Costs for Projects that primarily focus on relocating business or economic activity from one part of this state to another, except in cases where the business or economic activity would otherwise be located outside Oregon;

(4) Retirement of debt;

(5) Ongoing operations or maintenance expenses of any Project awarded or any Project Sponsor; and

(6) Indirect costs.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0050 Temporary rule language in effect until 12/18/2026. Application Process and Requirements

(1) The Department will issue a Request for Applications (“RFA”) prior to accepting applications for Program funding. The Department will only accept applications during the application period identified in the RFA.

(2) In order to receive financial assistance under the Program, an applicant must submit an application that:

(a) Is in the form required by the Department;

(b) Contains or is accompanied by such information and documentation as the Department may require;

(d) Demonstrates that the Project is eligible for Program funding under the Program statutes and rules;

(e) Contains a description of the proposed Project to be funded;

(f) Contains a description and summary of the eligible costs to be incurred for the proposed Project;

(g) Demonstrates the financial and operational ability to meet the terms and conditions of a loan agreement including repayment of the loan.

(h) If the applicant is seeking a loan, the application must contain financial information requested by the Department to determine the applicant’s ability to repay the loan including but not limited to:

(A) Three most current years of tax returns or Annual Comprehensive Financial Reports;

(B) Current and prior fiscal year profit and loss statements or statements of net income;

(D) Debt schedules for any relevant liabilities.

(i) Contain documentation demonstrating that the Project is fully funded.

(3) Applicants may submit an application for a single site or multiple sites.

(4) An application for Project funding across multiple sites must demonstrate that the scope of the Project relates to all sites. For example, multiple sites needing the same infrastructure or an opportunity analysis of a multi-site parcel of land.

(5) The Department will only evaluate completed applications.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0060 Temporary rule language in effect until 12/18/2026. Application Review and Scoring Criteria

(1) Applications will be reviewed and scored by an evaluation committee. Only complete applications will be submitted to the evaluation committee.

(2) Development Projects: Applications for Development Projects will be scored based on, at a minimum, the following criteria: the extent to which the Project is ready to proceed, the extent to which the applicant has capacity to timely repay the loan, the extent to which the Project will directly result in site readiness, business investment, or creation of new industrial lands for traded sector uses, including but not limited to, manufacturing, food processing, clean tech, semiconductor manufacturing or supply chain uses; and the extent to which the Project is funded with non-Program funds.

(3) Planning Projects: Applications for Planning Projects will be scored based on, at a minimum, the following criteria; the extent to which the application demonstrates there is a particular need for planning, engineering, legal or professional services related to industrial site development prepared by a qualified professional consultant with expertise in the subject matter; the extent to which the application demonstrates the need for preparation of applications for local, state, and federal permits prepared by a qualified consultant with expertise in the subject matter.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0070 Temporary rule language in effect until 12/18/2026. Loan Information

(1) The Department may make a loan to a Project Sponsor for eligible Project costs of a Development Project from the Fund. The loan amount awarded will be based on a reasonable and prudent expectation of the ability of the applicant to repay the loan and prudent fund management.

(2) The Department may make a forgivable loan to a Project Sponsor for eligible Project costs of a Planning Project from the Fund.

(3) The Department will determine the loan amount or forgivable loan amount based on criteria as detailed in the RFA.

(a) The minimum loan amount per Project is $25,000.

(b) The maximum loan amount per Project is $4,000,000.

(4) Interest will accrue on disbursed funds based on the latest published Infrastructure Finance Authority loan interest rates. The exact loan interest rate will be established at the time of e contract execution.

(5) Regular loan payments of principal and interest will become due and begin 6 years after the financing agreement execution date and will be structured to fully amortize the loan over the term of the loan not to exceed the maturity date described in subsection (7) below.

(6) The maturity date for any loan may not exceed the lesser of 30 years from Project Completion or the useful life of the Project.

(7) Loans may be repaid with revenue from any source. The Department will determine if sources of proposed loan repayment are sufficient to support the requested funding. The Department may require security such as a real property lien to secure the loan.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Or. Admin. R. 123-100-0080 Temporary rule language in effect until 12/18/2026. Forgivable Loan Information

(1) The Department may provide forgivable loans for Planning Project up to a maximum of 1% of the amount in the Fund.

(2) Forgivable Loans for a Planning Project shall be forgiven upon Project Sponsor providing documentation that the terms and conditions of the financing contract have been met, which may include special conditions such as listing the Project property on Oregon Prospector.

History

Statutory/Other Authority: ORS 285B.034
Statutes/Other Implemented: ORS 285B.032 - 285B.046
OBDD 13-2026, temporary adopt filed 06/22/2026, effective 06/22/2026 through 12/18/2026

Division 110 OREGON GROWTH BOARD

Or. Admin. R. 123-110-0001 Purpose and Statutory Authority

These rules implement ORS 284.885(8) and 284.887(3) and govern the activities of the Oregon Growth Board in overseeing the Oregon Growth Account and the Oregon Growth Fund. The Board operates under the authority of ORS 284.881 to 284.890.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Or. Admin. R. 123-110-0002 Definitions

For purposes of this division, the following terms have the meanings set forth below, unless the context clearly indicates otherwise. Additional definitions may be found in OAR 123-001-0050.

(1) “Account” means the Oregon Growth Account, established by ORS 348.702 and managed in accordance with ORS 284.881 to 284.890.

(2) “Fund” means the Oregon Growth Fund, established by ORS 284.890 and managed in accordance with ORS 284.881 to 284.890.

(3) “Board” means the Oregon Growth Board established by ORS 284.883.

(4) “Investment Policy Statement” means a statement describing the policies and procedures for investments from the Account and Fund, authorized by ORS 284.885 and ORS 284.887(2), and adopted by the Board with such title.

(5) “Investment Vehicle” means a partnership, limited liability company, fund, or similar pooled investment structure, typically managed by a general partner, investment manager, or other fiduciary.

(6) "Leverage" means third-party capital or other financial resources raised, committed, or deployed in connection with investments made by the Board with funds from the Account or the Fund. Leverage may include limited partner commitments, matching funds, co-investments, or other sources of capital associated with the same Investment Vehicle or strategy. Leverage does not refer to debt financing undertaken by the Board.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Or. Admin. R. 123-110-0003 Permissible Investments, Activities, and Services

(1) The Board may invest moneys from the Account or the Fund into Investment Vehicles to encourage investment in and availability of capital to businesses in this state and to increase resources available to local governments and state agencies that create, facilitate, maintain and promote financial services and support, consistent with ORS 284.881 to 284.890.

(2) Investments shall be made primarily through third-party fund managers with demonstrated expertise in relevant investment strategies. The Board shall not make direct investments in individual companies, except as may occur through such Investment Vehicles.

(3) The Board may fund loans, credit enhancements, or other financial commitments that support economic development and access to capital in Oregon from the Fund. The Board may fund grants from the Fund only when such awards are consistent with the Investment Policy Statement.

(4) In administering the Account and the Fund, the Board may engage in activities necessary to fulfill its responsibilities, including but not limited to establishing an Investment Policy Statement to be adopted by the Board; updating a strategic plan; approving capital commitments; contracting with management companies; reviewing and evaluating investment performance; and reporting activities and outcomes to Oregon Legislature.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Or. Admin. R. 123-110-0004 Use of Leverage and Financial Tools

(1) As authorized by ORS 284.885(8)(b), the Board may use or encourage the use of Leverage, guarantees, or other financial tools to maximize the impact of investments made through the Account and the Fund consistent with the Investment Policy Statement.

(2) For investments from the Account, the Board will prioritize commitments to fund managers or Investment Vehicles that raise at least three dollars of third-party capital for every one dollar of capital committed by the Board. Notwithstanding this prioritization, the Board will also consider the following when making awards: market conditions, opportunity, quality, and any other relevant factors the Board deems relevant.

(3) No specific Leverage ratio is required for investments from the Fund. The Board may consider the use of Leverage or other financial tools when making awards from the Fund, based on the economic development potential of the investment and the capacity of the recipient to raise matching capital. Examples of financial tools that the Board may consider include loan guarantees, subordinated capital, loan loss reserves, participation agreements, or other mechanisms designed to enhance capital formation or mitigate investment risk.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Or. Admin. R. 123-110-0005 Evaluation of Investments and Impact

(1) The Board shall maintain methods for evaluating the performance and impact of investments made through the Account and the Fund, including tracking and reviewing, at least annually, quantitative and qualitative indicators of performance, which may include but are not limited to:

(a) Financial returns to the Account and the Fund, including internal rate of return (IRR), distributions received, and unrealized value;

(b) The general characteristics of businesses assisted by fund managers, such as sector, location, and stage of development;

(d) Aggregate employment statistics for Oregon-based companies within the portfolios, including but not limited to, total payroll, average wages, and estimated state tax revenue generated;

(e) Other indicators relevant to assessing economic development, capital access, or entrepreneurial ecosystem health in Oregon.

(2) The Board shall require fund managers or recipients of capital to provide periodic reports sufficient to support this evaluation. Recipients must provide reports at least annually, however the Board may increase reporting requirements and frequency depending on the nature and scale of the investment and the capabilities of the manager.

(3) The Board may require different reporting methods and metrics for the Account and the Fund, reflecting differences in program objectives, fund structure, and data availability.

(4) The Board will evaluate the data collected from the reports. Evaluation findings may be used to inform future investment decisions and included in annual reporting to the Legislature or other stakeholders, as appropriate.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Or. Admin. R. 123-110-0006 Other Requirements

Pursuant to ORS 284.887(3), the Board may require either in the Investment Policy Statement or as part of an individual Investment Vehicle approval that a management company or state agency invest in Oregon an amount that is at least equal to the principal provided from the Account or the Fund and may consider investment strategy, fiduciary duty, market conditions, or other factors in making that determination.

History

Statutory/Other Authority: ORS 284.883 & ORS 284.890
Statutes/Other Implemented: ORS 284.883 & ORS 284.890
OBDD 5-2026, adopt filed 04/01/2026, effective 04/01/2026

Division 130 BROWNFIELDS PROPERTIES REVITALIZATION FUND

Or. Admin. R. 123-130-0000 Purpose

The purpose of these rules is to implement the Brownfields Properties Revitalization Fund created in 2021 through Chapter 529 Oregon Laws 2021. The purpose of the Brownfields Properties Revitalization Fund is to enhance the availability of resources through forgivable loans for the purpose of reimbursing private owners or operators for the eligible costs incurred in the completion of removal or remedial actions on properties that are brownfields.

History

Statutory/Other Authority: ORS 285A.075, ORS 285A.193 - 285A.198 & ORS 285A.185
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0010 Policy

It is the policy of the Oregon Business Development Department to promote sustainability and assist rural or distressed communities with local development priorities. Facilitating environmental cleanup consistent with a polluter-pays principle and the redevelopment of brownfields furthers this policy. The benefits of redeveloping brownfields include promoting economic development; enabling efficient land use; minimizing the construction of new service infrastructure; facilitating the resolution of environmental justice issues; and protecting environmental and human health.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0020 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division, the following terms mean:

(1) "Collateral" means property, real or personal, whether now owned or existing or hereafter acquired or arising, which is subject to a lien, security interest, pledge, or assignment in favor of the Department.

(2) "Contribution" means cash, a reduction in land sale price, a donation of real property or personal services of value; or some other like act that offsets the benefit of receiving sums from the Fund that are conveyed on a recipient or site owner who is a potentially responsible party for a release of a hazardous substance or is potentially liable for the cost of cleanup at the site according to ORS 465.255.

(3) “Distressed area” has the meaning given in 285A.010(9).

(4) “Environmental Action” means any of the following activities undertaken to:

(a) Determine if a release has occurred, if the release, or potential release, poses a significant threat to human health or the environment, or if additional remedial actions may be required at the site.

(b) Conduct a remedial investigation and a feasibility study.

(d) Removal or remediation of heating oil or nonresidential underground storage tanks.

(e) Any action described under ORS 285A.193(3)(A) or (B).

(f) Conduct a remedial action or removal action at a site.

(5) "Environmental Justice" means community-based issues, concerns, or problems resulting from the disparate effects caused by the placement and/or proximity of facilities that negatively impact minority or low-income populations.

(6) "Environmental Service Professional" means an entity that has the necessary education, training, experience, capacity, expertise, or is otherwise licensed or certified to conduct environmental actions.

(7) "Facility" means any building, structure, installation, equipment, pipe or pipeline including any pipe into a sewer or publicly owned treatment works, well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, above ground tank, underground storage tank, motor vehicle, rolling stock, aircraft, or any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located and where a release has occurred or where there is a threat of a release, but does not include any consumer product in consumer use or any vessel. Facility has the meaning given in ORS 465.200.

(8) "Fund" means the Brownfields Properties Revitalization Fund.

(9) “Geologist or Professional Engineer” means an environmental service professional licensed or otherwise certified in the State of Oregon to perform remedial action as described in ORS 285A.193(A).

(10) “Government Agency” means the applicable regulatory enforcement authority for compliance orders for owners or operators of brownfields to take action.

(11) "Hazardous Substance" has the meaning given in ORS 465.200.

(12) “Hospital Buildings or Community Health Care Facilities” has the meaning given to Hospitals in ORS 442.015(15) and the meaning given to Health Care Facility in ORS 442.0015(12).

(13) "Institutional Controls" has the meaning given in ORS 465.315 and OAR 340-122-0115(32).

(14) “Median Income” means the median household income from the most recent U.S. Census data and any adjustments since the most recent census from the American Community Survey and other data sources acceptable to the Department.

(15) “Natural Areas” means a unit of land or water or both that has substantially retained its natural character, or, if altered in character or in the process of being restored, shall in addition to its natural heritage resource values, be valuable as habitat for plant and animal species or for the study and appreciation of natural features.

(16) "Non-Profit" means an organization certified under sections 501(c)(2) through (4) and (6) through (8) and (10) of the Internal Revenue Code.

(17) “Operator” means the person or entity with rights to possess and use a site for a business purpose through a legally binding agreement or legal relationship with a site owner.

(18) “Owner” means the person with legal ownership of a site according to the records of the county recorder.

(19) "Person" means any individual, association of individuals, company, joint venture, partnership, non-profit or for-profit corporation.

(20) “Private” means any person as defined.

(21) "Project" and "Project Description" means the resulting combination of the site, the proposed activities to be performed, the proposed or likely redevelopment use, and any other information stated in the Fund application.

(22) "Prospective Purchaser Program" refers to ORS 465.327 and associated administrative rules.

(23) “Public Parks” means any park, natural area, wayside, corridor, scenic area, monument, historic structure or area, trail, or recreation area owned by a state or local government agency.

(24) “Release” has the meaning given in ORS 465.200.

(25) “Rural area” has the meaning given in ORS 285A.010(14).

(26) "Scope of Work" means a detailed plan to perform in part or in whole an environmental action.

(27) "Site" means the parcel or parcels of real property on which the environmental actions or other activities for which eligible costs are sought will be performed.

(28) "Site Characterization" means investigation or assessment to Site characterization may include delineating the nature and extent of contamination in soil, groundwater, soil vapor, and surface water. This review provides a level of detail comparable to a "preliminary assessment" (PA) as described in OAR 340-122-0072 and may be comparable to a "Phase II Environmental Site Assessment" under ASTM Standard E 1903.

(29) "Site Investigation" means a historic use investigation of the site involving, but not limited to, the analysis of aerial photos, public and private records, personal interviews, and other documents and data sources to determine the likelihood of a release of a hazardous substance at the site or facility. This review provides a level of detail comparable to a "Phase I" review under ASTM Standards E1527 and 1528 and is often a desktop review without any sampling.

(30) "Site Sampling" means systematically obtaining and analyzing representative samples from the site of relevant media such as soil and water to determine the presence of and/or the concentration of the contamination and/or identify the specific substances or compounds comprising the contamination. Sampling is a critical component of the "preliminary assessment" (PA) conducted under OAR 340-122-0072 or the ASTM "Phase II" under E-1903.

(31) “Wildfire” means an event as described in an Executive Order in accordance with ORS 476.510 to 476.610.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0030 Applicant Eligibility

(1) Any private person not currently liable under ORS 465.255 for an existing release of hazardous substances at a site is eligible to make application to the Department for assistance from the Fund.

(2) Eligibility under OAR 123-130-0030 shall also be determined based on the status of compliance with enforcement actions against the applicant by a government agency. If the applicant is not the owner and the site is owned by a person that is liable under ORS 465.255, the application will not be accepted unless the applicant provides documentation adequately demonstrating how the funded activities will facilitate a transfer in ownership of the site to a person not liable under ORS 465.255 or will be managed by an eligible operator.

(3) An applicant that makes false or willful misrepresentations regarding applicant eligibility on a Fund application may be subject to the remedies described in OAR 123-130-0080.

(4) Applicant must have the authority and ability to execute a financing contract with the Department.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 465.255 & ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0040 Project Eligibility

(1) Reimbursable eligible costs include project activities and environmental actions performed in accordance with ORS 285A.193(3)(a) but do not include costs excluded by ORS 285A.193(3)(b).

(2) Projects on sites that contain or are proposed to contain only privately owned single family residential dwelling(s) or privately owned multi-family dwelling(s) are not eligible for Fund assistance unless constructed or redeveloped in accordance with ORS 285A.194(3)(b).

(3) Projects on sites that contain or are proposed to contain mixed-use development, such as a structure or structures that contain combined commercial and residential uses, are eligible if:

(a) A written statement of zoning compliance for the project from the applicable local jurisdiction is included with the application; and

(b) The project will be constructed or redeveloped in accordance with ORS 285A.194(3)(b).

(4) The Department will determine if a project is eligible for loan enhancement in accordance with 285A.194.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0050 Application Requirements

(1) Applications that include site characterization must discuss in the project description how the environmental actions will contribute or lead to cleanup and/or redevelopment of the site.

(2) Applications must discuss in the project description how the environmental actions will contribute or lead to a remediation plan, certification of completion, or a No Further Action Determination by a government agency.

(3) Applications must identify the proposed redevelopment use in the project description and must provide documentation that demonstrates how the proposed redevelopment use is attainable.

(4) Applications must include discuss how the environmental actions will comply with state cleanup law and will contribute to the proposed redevelopment. The Department may ask the applicant to provide documentation that demonstrates how compliance, or how progress towards the proposed redevelopment, will be achieved.

(5) The funding requested must be objectively consistent with the scope and scale of work described in the application compared with similarly-situated projects. If the amount requested is objectively inconsistent with the scope and scale of work in the project description, the Department may work with the applicant to adjust the amount of the award or the scope and scale of work in the project description.

(6) If an applicant is liable under ORS 465.255 for an existing release of hazardous substances at a site, the application must include the information identifying a non-liable operator or a site transfer to an owner not liable under ORS 465.255. The Department may condition funding a project on confirmation by the applicant that a operator has been identified and is contractually bound to complete the activities and environmental actions described in the application, or that the site has been transferred to an owner not liable under ORS 465.255.

(7) Applications must also include the information required in accordance with ORS 285A.195(1) to be considered complete.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 465.255 & ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0060 Application Considerations and Processing

(1) The Department shall process completed Fund applications only. Applications will be considered complete when all relevant requirements of this Division are met.

(2) The Department can waive application requirements to make an application completion determination if such a waiver would serve to further the goals and objectives of the Fund and would not violate any statutory requirements.

(3) Sites or projects that have undertaken previous environmental actions, or that are subject to voluntary agreements, Consent Judgments, or other orders with a governmental agency, shall be eligible for consideration for loan Funds.

(4) The Department may request additional information about the project that is not listed in this Division if necessary to facilitate application processing.

(5) When evaluating an application, the Department shall consider the following:

(a) The extent to which real or perceived contamination complicates expansion or redevelopment of the site.

(b) The degree to which redevelopment of the site provides opportunity for achieving protection of human health or the environment by mitigating, reducing or eliminating contamination at the site or for contributing to the economic health and diversity of the area.

(c) The probability of the success of the intended use, or the degree to which redevelopment of the site advances the policy objectives in this Division.

(6) Department approval of an application may contain conditions which will become part of the financing contract.

(7) The Department will conduct a financial review on complete applications in accordance with prudent lending practices, including ability to service debt in the event of a forgivable condition default that would require a forgivable loan to be repaid. The Department may require that conditions of a loan award include collateral or other security such as requiring a co-signer or guarantor or other conditions to mitigate credit deficiencies.

(8) An Applicant may apply for a forgivable loan enhancement for public electric vehicle charging stations in accordance with ORS 285A.194(3)(a).

(a) The application must demonstrate that:

(A) The project will result in new publicly accessible charging stations for electric vehicles placed into operation immediately after completion.

(B) The brownfield is in a city, county, or census tract as determined by the Department and identified as having a need for additional charging stations in the Transportation Electrification Infrastructure Needs Analysis (TEINA) conducted by the Oregon Department of Transportation.

(b) For purposes of loan forgiveness, The Department will accept for forgiveness documentation that the new charging station has been reported to the U.S. Department of Energy for inclusion in the Alternative Fuels Data Center.

(9) The Applicant may apply for a forgivable loan enhancement for affordable housing in accordance with ORS 285A.194(3)(b).

(a) The applicant must show the following:

(A) The project will result in new affordable housing units.

(B) The number of new affordable housing units resulting from the project totals 4 or 20% of all dwelling units constructed, whichever is greater.

(b) For purposes of loan forgiveness, The Department will accept for forgiveness documentation that the site owner has recorded an enforceable deed restriction in favor of the local jurisdiction limiting use to ensure affordable housing units remain in use for at least 30 consecutive years after completion.

(10) The applicant may apply for a forgivable loan enhancement in rural, distressed, or high poverty areas in accordance with ORS 285A.194(3)(c). The applicant must show one of the following:

(a) The project is in a census tract with 20% or more residents below the federal poverty line as determined under 42 U.S.C. 9902, in effect on December 31, 2020, or as amended from time to time; or

(b) The brownfield is located in a rural area; or

(11) An applicant may apply for a forgivable loan enhancement for natural areas or public parks in accordance with ORS 285A.194(3)(d). The applicant must show that the project will result in at least 50% of the brownfield being permanently dedicated for use as a natural area; or public park. The Department will accept for forgiveness documentation that the site owner has recorded an enforceable deed restriction in favor of the state or local jurisdiction limiting use to ensure the natural area or public park remains in use in perpetuity.

(12) The applicant may apply for a forgivable loan enhancement for unmet health care needs in accordance with ORS 285A.194(3)(e). The applicant must show that:

(a) The project will result in a hospital or community health care facilities; and

(b) The brownfield is located in an area designated as having unmet health care need as documented in the most recent unmet need designation report by the Office of Rural Health.

(13) The applicant may apply for a forgivable loan enhancement for wildfire in accordance with ORS 285A.194(3)(f). The applicant must show that the brownfield became a brownfield as a direct result of wildfire.

(14) The Department may request additional information from the applicant to facilitate a funding decision

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198 & 42 U.S.C. 9902
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0070 Forgivable Loan Agreement Conditions

(1) Forgivable loans do not require match. Applicants will be responsible for closing costs associated with the loan including but not limited to document preparation, title, escrow, recording or filing fees.

(2) The Department shall set at time of award the interest rate and term for forgivable loans that must be repaid in accordance with ORS 285A.196(2).

(3) The Department will include interest accrual, repayment and disbursement schedules, timing of repayment determination, and other necessary conditions in the loan agreement.

(4) If the project includes other funding in the form of loan(s) obtained from a financial institution, the Department may subordinate the Fund loan to the financial institution loan(s) if appropriate, in the Department’s sole discretion.

(5) Notwithstanding applicant and project eligibility, the amount of a forgivable loan award shall be based on the availability of forgivable loan funds at the time of the award. The Department has the discretion to make forgivable loan awards less than the amount requested in the application if it is necessary to ensure forgivable loan capacity until further allocation to the Fund may be received.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0080 Remedies

(1) If, at any time, it is discovered that the applicant or the project violates the applicant eligibility exclusions in OAR 123-130-0030 or the project eligibility exclusions in OAR 123-130-0040, the Department may seek legal remedies against applicants that fail to comply with the requirements governing the fund. Remedies will not be imposed by the Department until the applicant has been notified in writing of deficiencies and has been given a reasonable time to respond and correct the deficiencies noted.

(2) One or more of the following remedies may be imposed by the Department:

(a) Bar a recipient from applying for future Fund assistance;

(b) Revoke an existing Fund award;

(d) Demand immediate repayment of expended funds; and

(e) Withhold other state funds.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Or. Admin. R. 123-130-0090 Consultation with Government Agency

(1) The Department will consult with the government agency prior to its funding decision and will provide the government agency with information about the applicant, site, project description, environmental service professional, and funding amount requested.

(2) Any recommendations or relevant comments from the government agency that are submitted to the Department within a reasonable period will be considered during the application review process.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285A.193 - 285A.198
Statutes/Other Implemented: ORS 285A.193 - 285A.198
OBDD 5-2023, adopt filed 01/26/2023, effective 01/26/2023
OBDD 7-2022, temporary adopt filed 11/03/2022, effective 11/03/2022 through 05/01/2023

Division 135 BROWNFIELDS REDEVELOPMENT LOAN FUND

Or. Admin. R. 123-135-0000 Purpose

The purpose of these rules is to implement the Brownfields Redevelopment Fund created in 1997 through Chapter 738 Oregon Laws 1997 and amended by Chapter 96 Oregon Laws 2001. The purpose of the Brownfields Redevelopment Fund is to enhance the availability of resources through program development, grant proposals and other appropriate methods necessary to determine and facilitate the funding of environmental actions on properties that are brownfields.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0010 Policy

It is the policy of the Oregon Business Development Department to promote sustainability and assist rural or distressed communities with local development priorities. Facilitating environmental cleanup consistent with a polluter-pays principle and the redevelopment of brownfields furthers this policy. The benefits of redeveloping brownfields include: promoting economic development; enabling efficient land use; minimizing the construction of new service infrastructure; facilitating the resolution of environmental justice issues; and protecting environmental and human health.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0020 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. As used in this division, the following terms shall have the following meaning unless otherwise indicated:

(1) "Bridge Loan" means a loan that will be repaid in full at the end of a short-term, twelve (12) to twenty four (24) months in length as determined at time of award or upon request within one year of award, following loan closing;

(2) "Brownfield" means real property where expansion or redevelopment is complicated by actual or perceived environmental contamination as defined in ORS 285A.185(1);

(3) "Capacity Building" involves conducting necessary studies that support the evaluation of a site or sites and incorporates cleanup activities for a site or sites with or without an identified redevelopment use but within zoning parameters to meet the buildable lands needs of a municipality;

(4) "Collateral" means property subject to a security interest or security agreement as defined in ORS 79.1050;

(5) "Contribution" means cash, a reduction in land sale price, a donation of real property or personal services of value; or some other like act that offsets the benefit of receiving sums from the Fund that are conveyed on a recipient or site owner who is a potentially responsible party for a release of a hazardous substance or is potentially liable for the cost of cleanup at the site according to ORS 465.255;

(6) "Environmental Action" means activities undertaken to:

(b) Conduct a remedial investigation and a feasibility study;

(d) Conduct a remedial action or removal action at a site.

(7) "Environmental Insurance" means a specific form of casualty insurance based on industry custom standards. Policies such as, but not limited to, cleanup cost caps, secured creditor on impaired property, or pollution legal liability are examples of environmental insurance;

(8) "Environmental Justice" means community based issues, concerns, or problems resulting from the disparate effects caused by the placement and/or proximity of facilities that negatively impact minority or low-income populations;

(9) "Environmental Service Professional" means an entity that has the necessary experience, capacity, expertise, or is otherwise certified to conduct environmental actions;

(10) "Facility" means any building, structure, installation, equipment, pipe or pipeline including any pipe into a sewer or publicly owned treatment works, well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, above ground tank, underground storage tank, motor vehicle, rolling stock, aircraft, or any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located and where a release has occurred or where there is a threat of a release, but does not include any consumer product in consumer use or any vessel. Facility has the meaning given in ORS 465.200;

(11) "Fund" means the Brownfields Redevelopment Fund;

(12) "Hazardous Substance" has the meaning given in ORS 465.200;

(13) "Institutional Controls" has the meaning given in ORS 465.315 and OAR 340-122-0115(32);

(14) "Municipality" means an Oregon city, county, the Port of Portland created by ORS 778.010, a county service district organized under ORS Chapter 451, a district as defined in 198.010, a tribal council of a federally recognized Indian tribe in Oregon, an airport district organized under ORS 838, or any other municipal corporation or quasi-municipal corporation.

(15) "Non-Profit" means an organization certified under sections 501(c)(2) through (4) and (6) through (8) and (10) of the Internal Revenue Code;

(16) "Person" means any individual, association of individuals, company, joint venture, partnership, or corporation;

(17) "Project" and "Project Description" means the resulting combination of the site, the proposed activities to be performed, the proposed or likely redevelopment use, and any other information stated in the Fund application;

(18) "Prospective Purchaser Program" refers to ORS 465.327 and associated administrative rules;

(19) "Release" (as in release of a hazardous substance) has the meaning given in ORS 465.200;

(20) "Scope of Work" means a detailed plan to perform in part or in whole an environmental action. Scopes of work shall be drafted by an environmental service professional;

(21) "Site" means the parcel or parcels of real property on which the funded activities will be performed;

(22) "Site Characterization" means determining and delineating the boundaries of the plume(s) of contamination and/or determining the status of the contamination such as whether it is migrating or crossing from one media to another, such as from soil to water, at the site. This review provides a level of detail comparable to a "preliminary assessment" (PA) as described in OAR 340-122-0072 and may be comparable to a "Phase II Environmental Site Assessment" under ASTM Standard E 1903;

(23) "Site Investigation" means a historic use investigation of the site involving, but not limited to, the analysis of aerial photos, public and private records, personal interviews, and other documents and data sources to determine the likelihood of a release of a hazardous substance at the site or facility. This review provides a level of detail comparable to a "Phase I" review under ASTM Standards E1527 and 1528 and is often a desktop review without any sampling;

(24) "Site Sampling" means systematically obtaining and analyzing representative samples from the site of relevant media such as soil and water to determine the presence of and/or the concentration of the contamination and/or identify the specific substances or compounds comprising the contamination. Sampling is a critical component of the "preliminary assessment" (PA) conducted under OAR 340-122-0072 or the ASTM "Phase II" under E-1903;

(25) "Term Loan" means a loan to be paid over a period of years, usually ten (10) to fifteen (15), with a rate of interest;

(26) "Voluntary Cleanup Program" relates to ORS 465.325 and associated administrative rules.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2008, f. & cert. ef. 6-4-08
Reverted to EDD 18-2002, f. & cert. ef. 12-10-02
EDD 3-2007(Temp), f. & cert. ef. 8-10-07 thru 2-5-08
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0030 Applicant Eligibility

(1) Any person, non-profit, or municipality is eligible to make application to the Department for assistance from the Fund as long as they are not subject to exclusion by ORS 285A.188(3)(a).

(2) Eligibility under OAR 123-135-0030 shall also be determined based on the status of compliance with enforcement actions against the applicant by the Oregon Department of Environmental Quality.

(3) If the applicant is not the land owner and the site is owned by a person that is excluded by OAR 123-135-0030(1), the application will not be accepted unless the applicant provides documentation adequately demonstrating how the funded activities will facilitate a transfer in ownership of the site to a person not subject to the exclusion.

(4) An applicant who is a responsible party for a release of a hazardous substance or is liable for the cost of cleanup at the project site according to ORS 465.255, must provide some form of contribution to the project to be eligible.

(5) An applicant that makes willful misrepresentations regarding applicant eligibility on a Fund application may be subject to the remedies described in OAR 123-135-0090.

(6) Applicant must have the authority and ability to enter into a contract with the Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0040 Project Eligibility

(1) Projects may contain non-residential underground storage tanks. Superfund sites on the National Priorities List are not eligible. Reimbursable project activities include, but are not limited to:

(a) Site investigation;

(b) Site sampling;

(d) Review, compilation and analysis of study data into a report;

(e) Feasibility studies;

(f) Plans for remedial action or removal;

(g) Conducting of a remedial action or removal at a site; or

(h) Regulatory oversight fees.

(3) Projects on sites that contain or are proposed to contain mixed use development such as a structure or structures that contain combined commercial and residential uses are eligible if:

(a) A written endorsement for the project from the local jurisdiction is included with the application;

(b) The project will provide a substantial public benefit; or

(4) The Department will determine if a project will have substantial public benefit.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 8-2006, f. 10-30-06, cert. ef. 10-31-06
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0050 Application Requirements

(1) Applications that include capacity building, site sampling and/or site characterization must discuss in their project description how the funded activities will contribute or lead to cleanup and/or redevelopment of the site.

(2) Applications that include a site characterization must discuss in the project description how the funded activities will contribute or lead to a remediation plan or a No Further Action Determination by the Oregon Department of Environmental Quality.

(3) Applications that include a remedial or removal action or plan must identify the proposed redevelopment use in the project description and must provide documentation that demonstrates how the proposed redevelopment use is attainable.

(4) Applications that include a remedial or removal action or plan must discuss in the application how the plan or action will comply with state cleanup law and will contribute to the proposed redevelopment. The Department may ask the applicant to provide documentation that demonstrates how compliance or how progress towards the proposed redevelopment will be achieved.

(5) Applications that include a remedial or removal action but do not identify a redevelopment use as described in OAR 123-135-0050(4) are eligible if the project is for capacity building. Written endorsement for the capacity building project must be obtained from the local jurisdiction and be included in the application if the applicant is not a municipality.

(6) The sum of funding requested in the Fund application must be consistent with the scope and scale of work in the project description compared with an industry custom standard. If the amount requested is inconsistent with the scope and scale of work in the project description, the Department may work with the Applicant and Oregon Department of Environmental Quality to adjust the amount of the award or the scope and scale of work in the project description.

(7) If OAR 123-135-0030(4) or (5) applies, the necessary information regarding property transfer and/or contribution must also be included in the application.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0065 Application Considerations and Processing

(1) Applications may be submitted to the Department at any time. The Department shall not process an incomplete Fund application. Applications are complete when all relevant requirements of this Division are met.

(2) The Department can waive application requirements in order to make an application completion determination if it is demonstrated that such a waiver would serve to further the goals and objectives of the Fund and would not violate any statutory requirements.

(3) The Department may request additional information about the project that is not listed in this division if necessary to facilitate application processing.

(4) When evaluating an application, the Department shall consider the following:

(a) The extent to which real or perceived contamination prevents the property from being fully utilized;

(b) The need for providing public assistance, after considering the difficulty of obtaining financing from other sources or of obtaining financing at reasonable rates and terms;

(c) The degree to which redevelopment of the property provides opportunity for achieving protection of human health or the environment by reducing or eliminating the contamination of the property and for contributing to the economic health and diversity of the area;

(d) The probability of the success of the intended use or the degree to which redevelopment of the property provides a public purpose following remediation of the property;

(e) Compliance with the land use plan of the local government with jurisdiction over the property;

(f) Endorsement from the local government with jurisdiction over the property.

(5) In the event of a shortage of funds, priority will be given to projects that provide significant economic benefit such as the creation of manufacturing or traded sector jobs and the Department may, at its discretion, consider other factors that demonstrate substantial public benefit.

(6) No more than sixty percent (60%) of the total amount of the Fund in any biennium shall be awarded to persons who are liable with respect to the site under ORS 465.255. The sixty percent (60%) limitation will be calculated at the beginning of each biennium and will be applied to the total, non-obligated, funds available in the Fund. Only awards to recipients that caused or contributed to the contamination at a site shall be included in the sixty percent (60%) calculation.

(7) Department approval of an application may contain conditions which will become part of the funding agreement.

(8) The Department will conduct a financial review on complete applications in accordance with prudent lending practices. Conditions of an loan award such as requiring collateral or other security; requiring a co-signer or guarantor; or obtaining an environmental insurance policy may be required in order to provide additional securities to mitigate credit deficiencies.

(9) The Department may request additional information from the applicant to facilitate a funding decision.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10

Or. Admin. R. 123-135-0080 Loan Agreement Conditions

(1) Loans do not require match. Applicants may be responsible for closing costs associated with the loan including but not limited to document preparation, review of documentation for legal sufficiency, title, escrow, recording or filing fees.

(2) The Department shall set the interest rate for municipal and non-municipal loan recipients at the time of award based on subsidy need, credit risk, and other appropriate considerations.

(3) Interest accrual, repayment and disbursement schedules, and other necessary conditions shall be stated in the loan agreement.

(4) Bridge loans shall have a maximum term of one (1) year from the beginning of loan disbursement unless the loan recipient requests an extension.

(a) Upon receipt of a request for extension, the maximum term of the extension shall not exceed one (1) additional year. If a bridge loan is not repaid within the approved period, a rate of interest may be applied from the date of first disbursement.

(b) A bridge loan recipient may be converted to a term loan. If a loan is converted, a rate of interest shall be applied from the date of first disbursement.

(5) The Department will set terms of repayment with consideration to the applicant’s ability to repay, credit worthiness, economic benefit of the project, and use of proceeds as defined in the project. The maximum term of a loan shall not exceed 20 years from the date of loan closing.

(6) A term loan may convert to a bridge loan with the approval of the Department as long as the maximum bridge loan term of two (2) years has not passed from the date of loan closing.

(7) If the project includes other funding in the form of loan(s) obtained from a financial institution, the Department may subordinate the Fund loan to the financial institution loan(s) if appropriate.

(8) The Department has the discretion to establish loan terms that differ from those enumerated in OAR chapter 123, division 135 as long as it furthers the goals and objectives of the program.

(9) For loan funded projects, the total loan amount shall not exceed the final total project cost.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 8-2001(Temp), f. & cert. ef. 11-15-01 thru 5-14-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0087 Grant Contract Conditions

(1) Municipal and eligible non-profit organization applicants may be eligible for grants. Determination of grant eligibility will be made by the Department at the time of award and may be based on subsidy need, credit risk, economic benefit, and other appropriate considerations. The Department has the discretion to impose conditions on the grant. Conditions shall be part of the grant contract, and if appropriate, the Department may require the recipient to demonstrate or document how the conditions have or will be met before funds are disbursed in whole or in part.

(2) All grant awards require some level of match. The level of match required will be determined based upon the liability considerations associated with the applicant and may have some portion waived if the applicant acquired the property according to ORS 465.327.

(3) For municipal and qualifying non-profit organization grant recipients, acceptable grant match includes cash, in-kind services, or other contributions of measurable value.

(4) For municipal and qualifying non-profit organization grant recipients that are not potentially liable for having caused or contributed to the release of contamination at the site and for which the project is located in or benefits a designated economically distressed community, the grant match is ten percent (10%) of the total award.

(5) For municipal and qualifying non-profit organization grant recipients that are not potentially liable for having caused or contributed to the release of contamination at the site and for which the project is not located in or does not benefit a designated economically distressed community, the grant match is twenty percent (20%) of the total award.

(6) Municipal and qualifying non-profit organization applicants that are potentially liable because the applicant’s conduct lead to or contributed to the release of contamination at the site receiving the environmental action are subject to a one to one (1:1) or 100% of award match requirement. Match must be in cash.

(7) Grant awards cannot exceed the final total project cost less the required match with a maximum award of $60,000. For grant funded projects with a match ratio of one to one (1:1), the final grant award shall not exceed fifty percent (50%) of the total final project cost or a maximum award of $60,000.

(8) If the environmental action at the site was funded with a condition requiring repayment of the grant the grant award must be repaid with any net profits generated from the resale of the site if that sale occurs within five (5) years after the completion of the environmental action. The repayment amount is the lesser of either the net profits or the amount of the grant award. Net profits equal the resale price less the sum of the purchase price and the required match for the project. In the case of properties resold by a county after property tax foreclosure, net profits equal the sum of the outstanding property tax, required match, and eligible expenses incurred by the County prior to award that are related to conducting environmental actions on the property.

(9) The Department shall make available technical assistance grants to municipalities for capacity building. Technical assistance grants may not exceed $25,000 per municipality. Technical assistance grants shall not be subject to financial review. Technical assistance grants shall require a 10% match which may include case, in-kind services or other contributions of measurable value.

(10) Notwithstanding applicant and project eligibility, the amount of a grant award shall be based on the availability of grant funds at the time of the award. The grant capacity of the Fund is determined by the Department based on a percentage of biennial allocations. The Department has the discretion to make grant awards less than the amount requested in the application if it is necessary to ensure grant capacity until the next allocation to the Fund by the Commission.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02

Or. Admin. R. 123-135-0090 Remedies

(1) If, at any time, it is discovered that the applicant or the project violates the applicant eligibility exclusions in OAR 123-135-0030 or the project eligibility exclusions in 123-135-0040. The Department may seek legal remedies against applicants that fail to comply with the requirements governing the fund. Remedies will not be imposed by the Department until the applicant has been notified in writing of deficiencies and has been given a reasonable time to respond and correct the deficiencies noted.

(2) One or more of the following remedies may be imposed by the Department:

(a) Bar a recipient from applying for future Fund assistance;

(b) Revoke an existing Fund award;

(d) Require return of unexpended funds;

(e) Demand immediate repayment of expended funds at a market based rate of interest; or

(f) Withhold other state funds.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0100 Subsidies and Waivers

(1) The Department has the discretion to waive interest charges or provide interest rate subsidies in the form of rate reductions and may grant any other form of waiver or subsidy within its authority. The Department shall utilize its discretion to make available interest charge waivers or provide interest rate subsidies following financial evaluation of the complete application taking into consideration the relationship between the project and the needs of the local community; the availability and or leveraging of other sources of funding in the project; and after determining whether the incentive will result in a substantial public benefit.

(2) The department shall waive interest for all bridge loans. The department shall set an interest rate for a bridge loan at the time of application approval in the event the bridge loan becomes a term loan or is not repaid within the allowed time period.

(3) Applicants may request consideration for incentives in the Fund application. The Department shall rule on all incentive requests made in the Fund application at the time of application approval.

(4) Determination of whether or not a project will result in a substantial public benefit will be made on a case-by-case basis by the Department.

(5) The Department may waive non-statutory requirements of this program if it is demonstrated such a waiver would serve to further the goals and objectives of the program.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 2-2001, f. & cert. ef. 2-1-01

Or. Admin. R. 123-135-0110 Consultation with Department of Environmental Quality

(1) In accordance with ORS 285A.188(4), the Department shall consult with the Department of Environmental Quality prior to the decision to approve an application. The Department shall provide the Department of Environmental Quality with information about the applicant, property, project description, environmental service professional, and funding amount requested.

(2) The Department of Environmental Quality shall verify within a reasonable period of time whether the applicant is ineligible for funding assistance in accordance with ORS 285A.188(3)(a).

(3) Any recommendations or relevant comments from the Department of Environmental Quality that are submitted to the Department within a reasonable period of time shall be included as part of the application for consideration.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285A.185 & 285A.188
OBDD 7-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 18-2002, f. & cert. ef. 12-10-02
Reverted to EDD 2-2001, f. & cert. ef. 2-1-01
EDD 10-2002(Temp), f. & cert. ef. 5-15-02 thru 11-11-02
EDD 2-2001, f. & cert. ef. 2-1-01

Division 140 OREGON COALITION BROWNFIELDS CLEANUP FUND

Or. Admin. R. 123-140-0010 Purpose, Scope, and Incorporated Documents

(1) As provided in Oregon Revised Statutes (ORS) 285A.190, the Oregon Business Development Department shall administer the federally funded revolving fund to provide cleanup financing to eligible publicly and privately owned brownfields as authorized by the Comprehensive Environmental Response, Compensation, and Liability Act, as amended, by the Small Business Liability Relief and Brownfields Revitalization Act of 2001 (P.L 107-118).

(2) Oregon Coalition Brownfields Cleanup Fund Program is funded through a cooperative agreement (BF-97080301, and as amended from time to time) between the U.S. Environmental Protection Agency and Department and includes any program income generated as a result of Department loans to Recipients as provided for in ORS 285A.192. The primary objectives of the Program are to:

(a) Remove or abate environmental health risks at sites not yet addressed by the private market;

(b) Provide resource assistance to rural, distressed, or affected communities allowing them to build quality, livable communities and neighborhoods; and

History

Statutory/Other Authority: ORS 285A.190, 285A.192 & 285A.075
Statutes/Other Implemented: ORS 285A.190
OBDD 39-2010, f. 10-29-10, cert. ef. 11-1-10
OBDD 19-2010(Temp), f. & cert. ef. 5-21-10 thru 11-17-10
OBDD 8-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 9-2006, f. 10-30-06, cert. ef. 10-31-06

Or. Admin. R. 123-140-0020 Definitions

For the purposes of these rules additional definitions may be found in Procedural Rules, OAR 123-001. For purposes of this division of administrative rules, unless the context demands otherwise:

(1) "Applicant" means any public or private entity that is eligible under OAR 123, division 140 to receive an OBCF loan or grant and that has control over or access to a brownfields site, except those entities that may potentially be liable under CERCLA, or are currently suspended or debarred from receiving federal funding, or are otherwise declared ineligible.

(2) "Brownfields" means real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.

(3) "CERCLA" means the Comprehensive Environmental Response, Compensation and Liability Act (42 United States Code 9601) as amended by the Small Business Liability Relief and Brownfields Revitalization Act (P.L. 107-118), and any subsequent amendments.

(4) "Fund" means the Oregon Coalition Brownfields Cleanup Fund.

(5) "Non-profit Organization" means as defined at Section 4(6) of the Federal Financial Assistance Management Improvement Act of 1999 except those non-profit organizations described in Section 501(c)(4) of the Internal Revenue Code that engage in lobbying activities as defined in Section 3 of the Lobbying Disclosure Act of 1995.

(6) "Program" means the Oregon Coalition Brownfields Cleanup Fund Program

(7) "Project" means under this division those remedial ad/or removal action activities identified in the Contract for which the Recipient may expend, obligate or commit funds to address cleanup of a brownfields.

(8) "Recipient" means an Applicant that has been awarded an OBCF grant or loan for a Project.

(9) "Remedial and/or Removal Actions" means those eligible cost activities listed in the Program Guidelines and Application Handbook.

(10) "Site" means the parcel or parcels of real property on which the funded activities will be performed;

(11) "USEPA" means the Environmental Protection Agency of the United States federal government.

History

Statutory/Other Authority: ORS 285A.190 & 285A.192 & 285A.075
Statutes/Other Implemented: ORS 285A.190
OBDD 39-2010, f. 10-29-10, cert. ef. 11-1-10
OBDD 19-2010(Temp), f. & cert. ef. 5-21-10 thru 11-17-10
OBDD 8-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 9-2006, f. 10-30-06, cert. ef. 10-31-06

Or. Admin. R. 123-140-0030 Eligible Applicants and Activities

(1) Eligible loan applicants are any public, private, or Non-Profit organization with control over or access to a brownfields site, except those entities which are potentially liable under CERCLA, or which are currently suspended, debarred from receiving federal funding, or are otherwise declared ineligible.

(2) Eligible grant applicants are any public or Non-Profit organization that owns a brownfields at the time the grant is awarded, except those entities which are potentially liable under CERCLA, which are currently suspended, debarred from receiving federal funding, or are otherwise declared ineligible.

(3) Eligible and ineligible activities are defined in CERCLA and in USEPA's Revolving Loan Fund Administrative Manual (October 2004), as well as subsequent revisions or editions of such guidelines.

History

Statutory/Other Authority: ORS 285A.190 & 285A.192 & 285A.075
Statutes/Other Implemented: ORS 285A.190
OBDD 39-2010, f. 10-29-10, cert. ef. 11-1-10
OBDD 19-2010(Temp), f. & cert. ef. 5-21-10 thru 11-17-10
OBDD 8-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 9-2006, f. 10-30-06, cert. ef. 10-31-06

Or. Admin. R. 123-140-0040 Program Information

(1) The Department shall prepare program guidelines, application forms and other supplemental program information to help eligible Applicants seek financing and prepare loan and/or grant applications for the Fund.

(2) Program guidelines as prepared under section (1) of this rule shall include, but not be limited to, an explanation of project eligibility, applicant eligibility, types of financial assistance, loan rates and terms, borrowing guidelines, public notification process, procurement requirements, contract administration, federal crosscutting requirements and environmental review process.

(3) In addition to this division of administrative rules, the Department shall administer the Fund in compliance with the requirements of CERCLA, as amended, and CERCLA’s applicable rules, guidelines and requirements from USEPA.

(4) For purposes of land use coordination, any Project activity paid for with Program funds that affects land use shall comply with the applicable requirements of OAR chapter 123, division 8 and OAR chapter 660.

History

Statutory/Other Authority: ORS 285A.190 & 285A.192 & Other 285A.075
Statutes/Other Implemented: ORS 285A.190
EDD 9-2006, f. 10-30-06, cert. ef. 10-31-06

Or. Admin. R. 123-140-0050 Program Rights and Remedies

(1) The Department may exercise certain rights and remedies in the event the Recipient fails to comply with Contract provisions and, if allowed under the Contract, the Recipient fails to correct the deficiency within a reasonable time after the Recipient is notified of the deficiency. The circumstances that may warrant the Department's exercise of rights or remedies include, but are not limited to the following:

(a) None of the Project activities have begun within nine months after an OBCF award;

(b) Any third party agreement relating to the Project is not legally binding within six months of the OBCF award;

(d) There is a significant deviation from the Contract;

(e) The Department finds that significant corrective actions are necessary to protect the integrity of the Project funds and those corrective actions are not, or will not, be made within a reasonable time; or

(f) A Recipient defaults on loan payments, which may otherwise be made from any source of revenue at the Recipient's disposal, including but not limited to General Fund revenues if the Recipient is a public entity borrower.

(2) The Department may exercise one or more of the following rights and remedies if the Recipient fails to comply with Contract provisions and the Recipient fails to correct the deficiency within a reasonable time after Recipient is notified of the deficiency:

(a) Bar a Recipient from applying for or receiving future Department assistance;

(b) Revoke an existing Department award;

(d) Require immediate return of unexpended Department funds;

(e) Require repayment of expended Department funds;

(f) Withhold other state funds otherwise due to the Recipient, such as state-shared revenues; or,

(g) Other remedies that may be incorporated into the Contract.

(3) The remedies set forth in this rule are cumulative, are not exclusive, and are in addition to any other rights and remedies provided by law or under the Contract.

(4) The Recipient shall be responsible for ensuring that any subcontractor complies with the applicable terms and conditions of the Contract. Nothing in this rule shall restrict the Department's right to enforce independently the terms of any contract or to recover any sums that may become due as a result of a breach of such Contract.

History

Statutory/Other Authority: ORS 285A.190, 285A.192 & 285A.075
Statutes/Other Implemented: ORS 285A.190
OBDD 8-2010, f. 3-30-10, cert. ef. 4-1-10
EDD 9-2006, f. 10-30-06, cert. ef. 10-31-06

Division 142 LEVEE PROJECT GRANT FUND

Or. Admin. R. 123-142-0000 Purpose and Objective

These rules establish procedures for the administration of the Levee Grant Program (“Program”). The Program is funded by the Levee Project Grant Fund. The Program provides financial assistance in the form of grants for the financing of Levee Projects across Oregon. Awards from the Special Public Works Fund Levee Project Subaccount established by ORS 285B.456 are governed by OAR Chapter 123, Division 042.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0005 Definitions

For the purposes of these rules, additional definitions may be found in Procedural Rules, OAR 123-001-0050. As used in this division of administrative rules, the following terms shall have the following meanings, unless the context clearly indicates otherwise:

(1) “Applicant” means an entity or individual that submits an application for a Program Award.

(2) “Authority” means the Infrastructure Finance Authority within the Oregon Business Development Department.

(3) “Award” means the selection of an application for Program funding.

(4) “Board” means the Oregon Infrastructure Finance Authority Board.

(5) “Direct Project Management Costs” means expenses directly related to a Levee Project that are incurred by an Award recipient solely to support or manage an eligible Levee Project. Direct Project Management Costs do not include an Award recipient’s routine or ongoing expenses.

(6) “Fund” means the Levee Project Grant Fund created by ORS 285B.421.

(7) “Levee” means a human-made structure, usually an earthen embankment or concrete floodwall, designed and constructed in accordance with sound engineering practices to contain, control, or divert the flow of water so as to provide reasonable assurance of excluding temporary flooding from the leveed area.

(8) “Levee Project” or “Project” means a planning project, development project, or other project that is directly related to and necessary for the construction, capital improvement, required inspections, Levee certification, accreditation or repairs of Levees, flood control embankments or flood control facilities.

(9) “Municipality” means an Oregon city or county, the Port of Portland created by ORS 778.010, a county service district organized under ORS Chapter 451, a district as defined in 198.010, a drainage district organized under ORS chapter 547, a tribal council of a federally recognized Indian tribe in this state, or an airport district organized under ORS 838, but does not include an ORS 190 entity.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0010 Eligible Applicants

The following entities are eligible to receive a Program grant:

(1) A Municipality;

(2) Corporations or companies for drainage or flood control organized under ORS Chapter 554; and

(3) For-profit or nonprofit entities and individuals engaged in the ownership, construction, inspection, accreditation, certification or repair of Levees.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0015 Eligible Projects, Costs, and Activities

(1) In order to be eligible for an Award, the Project must:

(a) Substantially contribute to the improvement, expansion or repair of the state’s or a Municipality’s infrastructure system; and

(b) Be essential for the continued use or development of farm, industrial, or commercial land in Oregon.

(2) For development projects, allowable Project costs include the necessary and reasonable costs, as determined by the Authority, for eligible Project activities. Eligible Project activities include, but are not limited to:

(a) Direct Project Management Costs;

(b) Consultant services;

(d) Property acquisition, including easements and rights of way that are directly related to and necessary for the Project;

(e) Costs incurred by the Applicant prior to the Award if such costs are allowable under the Authority’s adopted policy for reimbursement of pre-Award costs; and

(f) Other costs that the Authority determines to be necessary and reasonable.

(3) For planning Projects, allowable Project costs include the necessary and reasonable costs, as determined by the Authority, for eligible Project activities. Eligible Project activities include but are not limited to:

(a) Preliminary and final engineering activities related to a potential development project;

(b) Surveys, site investigations, or environmental actions related to a potential development project;

(d) Activities that the Authority determines to be necessary and reasonable in planning for a potential Levee Project.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0020 Ineligible Project Costs

The following costs are ineligible for funding under the Program:

(1) Purchase of general-purpose motor vehicles and equipment;

(2) Operation or maintenance costs; and

(3) Costs paid for by other financing for the Project, whether from the Authority or from another State of Oregon agency or any third party.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0025 Application Process

(1) In order to apply for an Award, Applicants must consult with Business Oregon and complete the preapplication process as prescribed by the agency.

(2) Once eligibility has been determined, the Agency will provide the Applicant with all necessary information to complete an application, which may include, but is not limited to the following:

(a) A brief description of the Project's purpose, highlighting the problem or opportunity that necessitates it;

(b) A detailed Project description that clearly describes the Project scope;

(d) A Project work plan, listing the significant Project activity milestones by estimated start and completion dates;

(e) A detailed map showing the location of the Project, including tax lots/parcels, zoning designations, road widths, etc.;

(f) Any study(s) conducted to determine the feasibility of the Project, or any preliminary architectural/engineering/planning work that has been completed for the Project;

(g) Documentation from the city or county planning agency that indicates the Project is consistent with the acknowledged local comprehensive plan and land use regulations; and

(h) Proof of levee ownership, operators agreement, or federal sponsorship agreement.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0030 Award Requirements and Limitations

(1) The Authority shall Award a minimum of 60 percent (60%) of the dollar value of grants awarded from the Fund in any biennium to Levee Projects in rural areas or distressed areas as those terms are defined in ORS 285A.010.

(2) For Projects that plan for or provide flood protection to cities with a population not greater than 5,000, applicants are required to provide matching funds of not greater than:

(a) Three percent of the amount of a grant Award of $100,000 or less.

(b) Five percent of the amount of a grant Award greater than $100,000.

(3) For Projects that plan for or provide flood protection to cities with a population greater than 5,000 but not greater than 7,500, applicants are required to provide matching funds of not greater than seven percent of the amount of the grant Award.

(4) For Projects that plan for or provide flood protection to cities with a population greater than 7,500 but not greater than 10,000, applicants are required to provide matching funds of not greater than nine percent of the amount of the grant Award.

(5) For Projects that plan for or provide flood protection to cities with a population greater than 10,000 but not greater than 20,000, applicants are required to provide matching funds of not greater than 12 percent of the amount of the grant Award.

(6) Population shall be determined according to the most recent federal decennial census.

(7) For all other Projects, Applicants must pledge matching funds to the Project of at least 20 percent (20%) of the Award amount.

(8) For planning grants, the Authority will not Award more than $2,000,000 to any Applicant per biennium.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420, ORS 285B.421 & Chapter 134, Oregon Laws 2026
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0035 Application Review and Approval

(1) The Authority will review all submitted applications to determine if they are complete and accompanied by all required supporting documentation.

(2) In order to approve a funding application, the Authority must determination that:

(a) The Project is feasible;

(b) The Project is ready to proceed;

(d) The Project is consistent with the requirements governing assistance from the Fund.

(e) Moneys in the appropriate accounts of the Fund are or will be available for the Project; and

(f) Any other criteria set forth in any applicable notices of funding availability issued by the Authority are satisfied.

(3) Once the evaluation is complete, the Authority will approve or reject the application. The Authority will make Award decisions in a manner that maximizes the use of available resources by applying prudent fiscal management of the Fund.

(4) If an application is approved, the Authority will issue the Applicant a notice of intent to award which will detail the amount of the Award and any other information the Authority considers necessary to make the Award, including a request for additional documentation.

(5) After issuing a notice of intent to award, the Authority will begin negotiating a contract with the selected Applicant.

(6) If the Authority determines that the Applicant or the Project does not meet the requirements of OAR chapter 123, division 142, the Authority may reject an application or require further documentation from the Applicant in order to verify eligibility. If the Authority rejects an application, it will issue the Applicant a letter of explanation. Rejection of an application does not preclude the Applicant from applying for future Program awards.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Or. Admin. R. 123-142-0040 Disbursement of Funds

The Authority shall disburse monies on a reimbursement or cost incurred basis from the fund only after entering a contract with the Applicant. The contract will be in form and substance as provided by the Authority, and must include:

(1) A provision that disbursements from the Fund will be according to the terms of the contract;

(2) A provision that the liability of the Authority under the contract is contingent upon the availability of moneys in the Fund for use in the Project;

(3) A provision that no Program funds will be disbursed until the Applicant has provided the Authority with sufficient documentation to demonstrate that the Applicant has all necessary funds, including matching funds, to complete the Project; and

(4) Other provisions that the Authority considers necessary or appropriate to implement the assistance.

History

Statutory/Other Authority: ORS 285B.413
Statutes/Other Implemented: ORS 285B.420 & ORS 285B.421
OBDD 12-2026, adopt filed 06/18/2026, effective 06/18/2026

Division 165 RECOVERY ZONE BONDS

Or. Admin. R. 123-165-0010 Purpose and Objectives

The Oregon Business Development Department allocates, reallocates and otherwise manages Oregon’s Recovery Zone Economic Development Bonding authority and Recovery Zone Facility Bonding authority. These rules are promulgated under authority granted by enacted 2009 Legislative Session HB 3199, Section 12 (4) and Section 12 (7)(a)–(c).

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 286A.630(4) & 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-165-0020 Definitions

(1) "Allocation" means an original allocation or reallocation of recovery zone bond volume cap.

(2) "ARRA" means the American Recovery and Reinvestment Act of 2009, H.R. 1, as amended.

(3) "Code" means the Internal Revenue Code of 1986, as amended.

(4) "Notice" means Notice 2009-50, published by the U.S. Treasury Department on June 12, 2009.

(5) "Notice of Intent" means a notice of intent to issue Recovery Zone Bonds on a form provided by the Department, which shall include the following:

(a) Name of Recipient receiving Allocation;

(b) Name of unit of local government that will issue the Recovery Zone Bonds;

(d) Description of area designated as Recovery Zone;

(e) Description of project to be financed;

(f) Dollar amount of the bond issue and amount of Allocation to be used and amount of Allocation (if any) remaining after such issuance;

(g) Any Reallocation requested by the Recipient for the project;

(h) If applicable, that the Recipient does not intend to use some or all of its Allocation, and is waiving such Allocation (or if less than all, the portion of Allocation being waived). In connection with any such waiver, the Recipient may designate a project being undertaken by another unit of local government within the jurisdiction using Recovery Zone Bonds, and request that the waived Allocation be reallocated to such unit of local government in connection with such project.

(i) Such other information as may be prescribed by the Department.

(6) “Original allocation” means the initial authorization for units of local government to issue Recovery Zone Facility Bonds or Recovery Zone Economic Development Bonds pursuant to ARRA. Oregon received $155,175,000 in Allocation for Recovery Zone Facility Bonds and $103,450,000 in Allocation for Recovery Zone Economic Development Bonds for 2009 and 2010; the original allocations awarded to counties and municipalities in the State are found in the Notice.

(7) “Originally awarded locality” means a city or county that received an original allocation of recovery zone economic development bond or recovery zone facility bond authority.

(8) "Reallocation" or “Reallocate” means an action by the department to allocate waived Recovery Zone Facility or Recovery Zone Economic Development Bonds volume cap to an eligible unit of local government.

(9) "Recipient" means any unit of local government that received an original allocation or reallocation.

(10) "Recovery Zone" means any area within the jurisdiction of the Recipient, designated as a "recovery zone" in accordance with Code Section 1400U-1(b) by the Internal Revenue Service or local determination in compliance with the Code.

(11) "Recovery Zone Bonds" means Recovery Zone Economic Development Bonds and Recovery Zone Facility Bond. authorized under Section 1401 of Title I of Subtitle B of the American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat. 115 (2009), that may be issued by states, counties, certain municipalities and other qualified issuers within each state before January 1, 2011.

(12) "Recovery Zone Economic Development Bonds" means Recovery Zone Economic Development Bonds issued pursuant to Code Section 1400U-2, which in general are governmental bonds issued by a qualified issuer for economic development purposes (as defined in Code Section 1400U-2) that provide for a refundable tax credit paid to the issuer of the bonds in an amount equal to 45% of the taxable interest payable to investors in such bonds.

(13) "Recovery Zone Facility Bonds" means Recovery Zone Facility Bonds issued pursuant to Code Section 1400U-3, which in general are a type of private activity, exempt facility bond that permit financing of recovery zone property (as defined in Code Section 1400U-3) for use in any trade or business other than certain prohibited businesses enumerated in Section 1400U-3(c)(2).

(14) "Volume cap" or “Cap” means the recovery zone bond volume limitation allocated to each state and to counties and municipalities within each state in accordance with Code Section 1400U-1.

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 286A.630(4) & 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-165-0030 Use of Original Allocation and Reallocation

(1) For the purposes of recovery zone economic development bond and recovery zone facility bond allocations, a recipient of an original allocation may use its allocation or designate other issuing localities within the jurisdiction of the originally awarded locality to use all or a portion of its original allocation by any procedure mutually acceptable to both parties subject to federal requirements.

(2) An originally awarded locality that intends to use its original allocation or intends to designate another issuer within the jurisdiction of the originally awarded locality to use the original allocation must file a Notice of Intent form by March 1, 2010 with supporting documentation.

(3) An originally awarded locality that has used the Notice of Intent form to express its intent to use or designate another issuer within the jurisdiction to use its original allocation may amend the Notice of Intent at a later time if it is determined that the locality is unable to use its original allocation in the manner previously stated or has decided to waive all or part of the original allocation for reallocation by the state pursuant to subsection (6) below.

(4) An originally awarded locality intending to use its original allocation and has filed a Notice of Intent pursuant to subsection (2) above must provide the department with project information and supporting documents by April 16, 2010 that shows substantial progress. Supporting documents include bond counsel and underwriter statement of intent documents and a certified copy of a resolution of the governing body of the recipient designating a recovery zone and stating its intent to use its original allocation. A recipient may request a time extension if filed by April 16, 2010.

(5) If an originally awarded locality is not able to or chooses not to use all or a portion of its original allocation or does not offer all or a portion of the original allocation to another issuer within the jurisdiction of the originally awarded locality, the original allocation may be waived. In cases where original allocation is not used, federal code provisions and U.S. Department of Treasury guidance in IRS Notice 2009-50 allow original allocations to be waived by the recipient and then used by the state or reallocated by the state to other issuing localities. The department, as authorized in statute, has accepted the reallocation role on behalf of the state. Waived recovery zone economic development bond or recovery zone facility bond authority may be used by the state or reallocated by the department to other issuing localities.

(6) Any recipient of original allocation or reallocation may affirmatively waive all or a portion of its allocation to the state pursuant to the following procedure:

(a) Submitting an appropriately completed Notice of Intent form; and

(b) The form must be signed by the official(s) of the recipient authorized to execute the form pursuant to a resolution waiving the allocation adopted by the recipient’s governing body.

(7) If a recipient of original allocation or reallocation has not provided the department with the Notice of Intent to subsection (2) above or supporting documentation pursuant to subsection (4) above or subsection (12) below the department may issue a Notice of Intent to Reallocate, informing the recipient of the department’s intent to deem the allocation to have been waived to the state and to make such allocation available to reallocate to another locality or use by the state.

(8) A recipient will have fifteen calendar days from receipt of a Notice of Intent to Reallocate to respond to the department with the required documentation or to ask the department to reconsider its waiver determination.

(9) The department will respond to the request to reconsider its waiver determination within ten business days with a decision by the department director or the director’s designee to grant an extended time in which the issuing jurisdiction must demonstrate substantial progress toward a recovery zone economic development bond or recovery zone facility bond issuance, or a decision to go forward with the waiver of the allocation. The length of the time of the extension shall be determined at the discretion of the department.

(10) Any local government issuer may request a reallocation of recovery zone facility bonds and/or recovery zone economic development bonds authority by submitting a department supplied Recovery Zone Bonds Request for Reallocation form to the department. The department will acknowledge the request within five business days and provide a determination on the reallocation of cap within fifteen business days of the acknowledgement.

(11) The department will notify a recipient of its determination to award reallocation of volume cap in writing in a Reallocation Award Letter.

(12) A recipient of reallocated cap must provide the department with project information and supporting documents within 45 days of the date of the Reallocation Award Letter, or sooner if required by the department, that shows substantial progress. Supporting documents include bond counsel and underwriter statement of intent documents and a certified copy of a resolution of the governing body of the recipient designating a recovery zone and stating its intent to use its allocation.

(13) The department will carry out continual review of the use of recovery zone facility bonds and/or recovery zone economic development bonds authority to determine if original allocations as well as reallocations were used or are likely to be used before year end. To the extent recovery zone bond authority is identified to not be used, a final reallocation will occur late in 2010 for any bonding projects in the state meeting the code qualifications.

(14) Following the issuance of any recovery zone bond, the issuer of such bond shall promptly deliver a copy of the report required to be filed with the Internal Revenue Service (e.g. the Form 8038 for recovery zone facility bonds and the Form 8038G for recovery zone economic development bonds) to the department. The department will maintain a list of all recovery zone bonds issued and all allocations used, waived, and available for full or partial reallocation.

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 286A.630(4) & 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-165-0040 Criteria for Reallocation Award of Recovery Zone Economic Development Bonds Cap

In accordance with the intent of the code and state priorities, the following criteria will be used to prioritize reallocation requests by the department:

(1) The relative level of economic distress in the local community.

(2) The number of citizens benefiting from the project.

(3) The estimated positive economic, health, or environmental impact of the project on the local community, region, and state.

(4) The number of jobs created or retained by the project as can be best estimated.

(5) Whether the availability of the reallocation is a crucial part of attracting a new company or keeping an existing company in place;

(6) Whether the requested reallocation will benefit a project for which a recipient or other unit of local government is issuing recovery zone bonds;

(7) Whether the requested reallocation will benefit a project that was designated by a recipient in connection with a previous waiver of its allocation.

(8) The readiness of the project to proceed including consideration for the likelihood that the issuer will use the allocation within the timelines.

(9) The amount of other public and private funding leveraged by the recovery zone economic development bond allocation.

(10) The amount of local community support for the project, other agency support, and the degree the project supports efficient use of resources.

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 286A.6304 & 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-165-0045 Criteria for Reallocation Award of Recovery Zone Facility Bonds Cap

In accordance with the intent of the code and state priorities, the following criteria will be used to prioritize reallocation requests by the department:

(1) The relative level of economic distress in the local community.

(2) The number of citizens benefiting from the project.

(3) The estimated positive economic impact of the project on the local community, region and state.

(4) The number of jobs created or retained by the project as can be best estimated.

(5) Whether the availability of the reallocation is a crucial part of attracting a new company or keeping an existing company in place;

(6) Whether the requested reallocation will benefit a project for which a recipient or other unit of local government is issuing recovery zone bonds;

(7) Whether the requested reallocation will benefit a project that was designated by a recipient in connection with a previous waiver of its allocation.

(8) The readiness of the project to proceed including consideration for the likelihood that the issuer will use the allocation within the timelines.

(9) The amount of other public and private funding leveraged by the recovery zone facility bond allocation.

(10) The amount of local community support for the project, other agency support, and the degree the project supports efficient use of resources.

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 286A.6304 & 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Or. Admin. R. 123-165-0050 Rule Waiver

The director may waive any non-statutory requirements of OAR chapter 123, division 165 if it is demonstrated such a waiver will further the goals and objectives of the program.

History

Statutory/Other Authority: ORS 286A.630 & 285A.075
Statutes/Other Implemented: ORS 285A.075
OBDD 16-2010, f. 4-30-10, cert. ef. 5-1-10
OBDD 3-2010(Temp), f. & cert. ef. 1-14-10 thru 7-13-10

Division 200 CERTIFICATION PROCEDURES

Or. Admin. R. 123-200-1000 Purpose

(1) The purpose of OAR 123-200-1000 to 123-200-2200 is to adopt a standard application form and procedure designed to provide complete documentation for certification of businesses as minority, woman, veteran owned businesses or an Emerging Small Business or the Oregon Small Business Enterprise and to adopt a procedure for handling complaints, investigations, and issuing sanctions.

(2) The Certification Office for Business Inclusion and Diversity (COBID) is the sole certification agency for the State of Oregon and all political subdivisions. To the extent there is any reference to the Office of Minority, Women, and Emerging Small Business from the implementation of these rules forward, all references defer to the agency’s new name, COBID.

(3) The COBID shall certify Minority Business Enterprises (MBE), Woman Business Enterprises (WBE), Veteran Business Enterprise (VBE), Emerging Small Businesses (ESB), and Oregon Small Business Enterprise (OSBE) under the State of Oregon certification program based on ORS 200.005 to ORS 200.075. Any public contracting agency shall consider an enterprise certified by the COBID as eligible to participate in the certification programs pursuant to these rules in the State of Oregon as defined in ORS 279.011(5).

(4) Certified firms are eligible to participate on state funded projects to meet commitment requirements. Any certified firm is eligible to participate in private or non-state funded projects.

(5) These rules also cover publication of a directory, ineligibility complaints, and representation of the COBID in contested case hearings.

(6) Determinations for MBE, WBE, VBE, OSBE and ESB certification will be based solely on the rules contained in OAR 123-200-1000 to OAR 123-200-2300.

History

Statutory/Other Authority: ORS 285A.070, ORS 285A.075(1)(a) & ORS 200.025(2)
Statutes/Other Implemented: ORS 200.055, ORS 200.170, ORS 279.011 & Oregon Laws 2023, Chapter 497
OBDD 6-2026, amend filed 04/02/2026, effective 04/02/2026
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 4-2018, minor correction filed 02/16/2018, effective 02/16/2018
OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0005, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Or. Admin. R. 123-200-1100 Definitions

As used in these rules, the following terms shall have the following definitions, unless the context requires otherwise:

(1) “Agency” means the Oregon Business Development Department.

(2) “COBID” means the Certification Office for Business Inclusion and Diversity in the Oregon Business Development Department.

(3) “Commercially Useful Function” or “CUF” means function the firm performs when it is responsible for execution of the work of the contract and carries out its responsibilities by actually performing, managing, and supervising the work involved. The firm must also be responsible, with respect to materials and supplies used on the contract, for negotiating price, determining quality and quantity, ordering the material, and installing (where applicable) and paying for the material itself.

(4) “Contribution” means a real and substantial contribution of money, tangible personal assets, and expertise to acquire ownership interest in the firm. A contribution is not a promise to contribute, an unsecured note payable to the firm or an owner who is not a disadvantaged individual, or mere participation in a firm’s activities as an employee.

(5) “Control” or “controlled” means that operational and managerial control of all aspects of the business is true, real, and exercised by one or more qualifying individual(s).

(6) “Disadvantaged Business Enterprise” or “DBE” means a business that meets the eligibility standards for participation in United States Department of Transportation (USDOT) federally funded projects as described in 49 CFR parts 23 and 26 (2013 Edition).

(7) “Emerging Small Business” or “ESB” means an independent business or firm that meets the requirements described in OAR 123-200-1600.

(8) “Independence” or “Independent” means the business is not dependent upon any non-qualifying individual or firm.

(9) “Management Control” or “Management” means that the applicant has responsibility for the critical areas of business operations and has the demonstrated ability to make independent and unilateral business decisions needed to guide the future of the business.

(10) “Minority” means a person who is a citizen or lawful permanent resident of the United States and who is one of the persons described in (a) through (f) below.

(a) Black American includes persons having origins in any of the Black racial groups of Africa;

(b) Hispanic American includes persons of Mexican, Puerto Rican, Cuban, Central or South American or other Spanish or Portuguese culture or origin, regardless of race;

(d) Asian-Pacific American includes persons whose origin is from Japan, China, Taiwan, Korea, Vietnam, Laos, Cambodia, Thailand, Malaysia, Indonesia, the Philippines, Brunei, Samoa, Guam, the United States Trust Territories of the Pacific Islands, the Commonwealth of the Northern Marianas Islands, Macao, Fiji, Tonga, Kiribati, Tuvalu, Nauru, Federated States of Micronesia, or Hong Kong;

(e) Subcontinent Asian Americans includes persons whose origins are from India, Pakistan, Bangladesh, Bhutan, the Maldives Islands, Nepal, or Sri Lanka;

(f) Any additional groups whose members are designated as socially disadvantaged by the Small Business Administration and/or as designated under 49 CFR Part 26 (2013 Edition).

(g) Other minority group membership as established by the applicant. Membership is based on evidence provided by the applicant to support the applicant’s claim he or she is a member of a minority group, and the particular minority community recognizes the individual to be a member of the community. It is in COBID’s discretion to determine if the applicant’s claim is valid. If the minority community does not exist in Oregon, the burden of proof shifts to the applicant to prove he or she is a socially and economically disadvantaged individual.

(11) “Minority Business Enterprise” or “MBE” means a business owned and operated by a minority who meets the eligibility standards set out in OAR 123-200-1210 through 123-200- 1240. For the purposes of the certification programs, the rules recognize women as a separate group and not as a “minority” group.

(12) “Ownership” or “Owned” has the meaning set out in OAR 123-200-1220.

(13) “Public agency” or “agency” means every government officer, board, commission, department, institution, branch or agency of the government, whose costs are paid wholly or in part from funds held in the federal, state, county, or city treasury.

(14) “Principal place of business” means the place where the firm directs, controls, and coordinates its primary, high-level business activities; the address the firm uses to file Federal income taxes. If the firm uses a P.O. Box, the COBID may request additional documentation to verify location.

(15) “Qualifying Individual” means a person who COBID has determined meets the eligibility requirements in these rules for the type of certification being sought by such person. For example, a qualifying individual who is seeking certification as a VBE is a person who COBID determines meets all the qualifications of being a “veteran” as defined in these rules.

(16) Small Business” means a small business as defined in 13 CFR part 121 (e-CFR 2015 Edition). A small business shall not include any concern or group of concerns controlled by the same qualifying individual or individuals that have average annual gross receipts over the previous three fiscal years (including its affiliates) that exceed the cap as established yearly by the U.S. Small Business Administration (SBA).

(a) Firms seeking certification must also meet the business and North American Industry Classification System (NAICS) size standards set yearly by the SBA.

(b) The COBID will utilize federal tax information, submitted by the applicant along with new applications, No Change Statements, and certification review applications, to determine annual gross receipts for the business.

(17) “Socially Disadvantaged Individuals” means individuals who are minorities, women, or any other individuals found to be disadvantaged by the SBA pursuant to Section 8(a)(5) of the Small Business Act and has the meaning set out in 49 CFR § 26.67 (e-CFR 2015 Edition).

(18) “Timely notice” as used in ORS 200.035, shall mean at the time the state agency publicly releases the contract and bid request solicitations.

(19) “Veteran Business Enterprise (VBE)” means a business owned by a Veteran who meets at least one of the following criteria:

(a) Served on active duty with the Armed Forces of the United States:

(A) For a period of more than 90 consecutive days beginning on or before January 31, 1955, and was discharged or released under honorable conditions;

(B) For a period of more than 178 consecutive days beginning after January 31, 1955, and was discharged or released from active duty under honorable conditions;

(C) For 178 days or less and was discharged or released from active duty under honorable conditions because of a service-connected disability;

(D) For 178 days or less and was discharged or released from active duty under honorable conditions and has a disability rating from the United States Department of Veterans Affairs; or

(E) For at least one day in a combat zone and was discharged or released from active duty under honorable conditions;

(b) Received a combat or campaign ribbon or an expeditionary medal for service in the Armed Forces of the United States and was discharged or released from active duty under honorable conditions;

(d) Is a disabled veteran, as defined in ORS 408.225; or

(e) Has been a reserve officer or member of a National Guard unit for at least five years before the individual seeks a certification under ORS 200.055.

(f) As used in paragraph (a) of this subsection, “active duty” does not include attendance at a school under military orders, except schooling incident to an active enlistment or a regular tour of duty, or normal military training as a reserve officer or member of an organized reserve or a National Guard unit.

(20) “Woman Business Enterprise” or “WBE” means a business owned and operated by a woman who meets the eligibility standards set out in OAR 123-200-1210 through 123-200-1240.

(21) "Oregon Small Business Enterprise” or “OSBE” means an independent business or firm that meets the requirements described in OAR 123-200.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 285A.070, ORS 285A.075(1)(a) & ORS 200.025(2)
Statutes/Other Implemented: ORS 200.005 & Oregon Laws 2023, chapter 497
OBDD 6-2026, amend filed 04/02/2026, effective 04/02/2026
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 5-2018, minor correction filed 02/16/2018, effective 02/16/2018
OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0010, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Or. Admin. R. 123-200-1210 Minorities and Women Business Enterprise Certification — Determination of Socially and Economically Disadvantaged

(1) It is a rebuttable presumption that minorities and women are socially and economically disadvantaged.

(2) The COBID may also determine on a case-by-case basis other individuals who are socially and economically disadvantaged. These individuals claiming disadvantaged status are required to submit a socially and economically Disadvantaged Questionnaire administered by COBID.

(3) Socially disadvantaged individuals are people subject to racial or ethnic prejudice or cultural bias because of their identity as members of a group without regard to individual qualities.

(a) The social disadvantage must stem from the individual’s color, national origin, gender, physical handicap, long-term residence in an environment isolated from the mainstream of American society, or other similar cause beyond the individual’s control.

(b) The minority and women applicants must demonstrate:

(A) He or she personally suffered the social and economic disadvantage because of discriminatory treatment in the United States; and

(B) The social and economic disadvantage was chronic, long-standing, and substantial, and was not fleeting or insignificant.

(4) Social disadvantage does not include factors common to small business.

History

Statutory/Other Authority: ORS 285A.070, ORS 285A.075(1)(a) & ORS 200.025(2)
Statutes/Other Implemented: ORS 200.005, ORS 200.055 & Oregon Laws 2023, chapter 497
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 6-2018, minor correction filed 02/16/2018, effective 02/16/2018
OBDD 1-2016, f. & cert. ef. 1-5-16

Or. Admin. R. 123-200-1220 Determination of Ownership

(1) In determining whether the qualifying individual owns the firm, the COBID must consider all the facts in record viewed as a whole.

(2) One or more qualifying individuals must own at least 51% of the business. COBID will apply the standard criteria for ownership as set out:

(a) In the case of a corporation, such individual(s) must own at least 51 percent of each class of voting stock outstanding and 51 percent of the aggregate of all stock outstanding.

(b) In the case of a partnership, the qualifying individual(s) must own 51 percent of each class of partnership interest. The ownership must also reflect in the firm’s partnership agreement.

(3) In the case of a limited liability company, the qualifying individual(s) must own at least 51 percent of each class of member interest.

(4) If a firm is owned by a combination of qualifying individuals, the COBID will determine whether a firm is certified as a MBE, WBE, or VBE based on which individual possesses overall management and control of the firm. Evidence in support of management and control may include one or more of the following:

(a) Professional licensing as generally required by the industry (e.g., engineer, architect, plumber, electrician, landscape architect, etc.);

(b) Control of day-to-day operations of the firm;

(d) Ability to hire and fire staff.

(5) The business must be controlled by one or more qualifying individual(s) as described in OAR 123-200-1240.

(6) One or more of the qualifying individual(s) must have made a substantial contribution of capital to the business, which is commensurate with his or her ownership interest.

(a) The COBID may consider differences in compensation between the potentially certified owner(s) and other participants in the firm to determine whether to certify a firm. Such consideration shall encompass the duties of the persons involved, normal industry practices, the firm’s policy, and practice concerning reinvestment of income, and any other explanations for the differences proffered by the firm.

(b) A contribution is not a promise to contribute capital, an unsecured note payable to the firm or to an owner who is not a qualifying person or mere participation in a firm’s activities as an employee. Debt instruments from financial institutions or other organizations that lend funds in the normal course of their business do not render a firm ineligible, even if the debtor’s ownership interest is security for the loan.

(7) The qualifying individual’s ownership in the firm must be real, substantial, and continuing, going beyond pro forma ownership and reflected as such in all business documents. The qualifying individual(s) must enjoy the customary incidents of ownership and share the risks and profits commensurate with their ownership interest, as demonstrated by the substance, not merely the form, or arrangements.

(8) The qualifying individual(s) must directly hold all securities that constitute ownership of a firm.

(a) Except as provided in this paragraph, the COBID does not consider securities or assets held in trust, or by any guardian for a minor, as owned or held by the qualifying individual(s) in determining the ownership of a firm.

(b) The COBID does recognize securities or assets held in trust by a qualifying individual for purposes of determining ownership of the firm, if:

(A) The beneficial owner of securities or assets held in trust and the trustee are both qualifying individuals; or

(B) The beneficial owner of a trust is a qualifying individual who, rather than the trustee, exercises effective control over the management, policymaking, and daily operational activities of the firm. The applicant may count assets held in a revocable living trust only in the situation where he or she is the sole grantor, beneficiary, and trustee.

(9) If the applicant is relying on his or her expertise for certification, he or she must have a significant financial investment in the firm.

(10) The COBID will consider the following requirements as they apply to situations in which the applicant relies on his or her expertise as a contribution to acquire ownership. The owner’s expertise must be:

(a) In a specialized field;

(b) Of outstanding quality;

(d) Indispensable to the firm’s potential success;

(e) Specific to the type of work the firm performs; and

(f) The records of the firm must reflect the applicant’s expertise. These records must clearly show the contribution of expertise and its value to the firm. The applicant may quantify his or her expertise in years of experience, education, and accomplishments related to the types of services the firm offers.

(11) When an applicant receives majority stock ownership or control of a firm from a non-qualifying applicant within two years prior to submitting an application and the non-qualifying applicant remains involved in the firm as a stockholder, officer, director, or key employee, the COBID will presume that the applicant does not control the firm. The applicant may rebut this presumption by showing that he or she has independent management experience necessary to control the operation of the firm and indeed is participating in the management of the firm.

(12) Assets held by a qualifying individual as result of a final property settlement; court order in a divorce or, legal separation from a non-qualifying individual or through inheritance are assets of the qualifying individual. The terms and conditions of legal documentation governing that transaction (i.e., divorce settlement, legal will, etc.) support the transfer of ownership to the qualifying individual.

(13) The COBID will not consider as evidence of ownership interests or assets in a firm obtained by a qualifying individual through gift or transfer from a non-qualifying individual unless there is evidence to support the transfer of interests and assets occurred for reasons other than obtaining certification.

(14) To overcome this presumption and permit the COBID to count interests or assets, the qualifying individual must demonstrate by clear and convincing evidence that:

(a) The gift or transfer was made for reasons other than obtaining certification; and

(b) The qualifying individual actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-qualifying individual who provided the gift or transfer.

(15) The COBID will closely scrutinize such transfers when the qualifying individual and non-qualifying individual are:

(a) Directly affiliated and involved in the same firm for which the qualifying individual is seeking certification;

(b) Involved in the same or a similar line of business; or

(c) Engaged in an ongoing business relationship related to the types of services in which the qualifying individual is seeking certification.

(16) In situations in which marital assets form a basis for ownership of a firm, the COBID considers the following:

(a) When marital assets (other than the assets of the business in question), held jointly or as community property by both spouses, are used to acquire the ownership interest asserted by one spouse, the COBID must deem the ownership interest in the firm to have been acquired by that spouse with his or her own individual resources. In doing so, the other spouse must irrevocably renounce and transfer all rights in the ownership interest of the applicant in the manner sanctioned by the laws of the state in which either spouse or the firm is domiciled. The COBID does not count a greater portion of joint or community property assets toward ownership than state law would recognize as belonging to the qualifying owner of the applicant firm.

(b) The COBID will require a fully executed Non-participation Statement renouncing the non-qualifying spouse or domestic partner’s rights in the jointly owned or community asset used to acquire an ownership interest in the firm.

(17) The COBID must not regard a contribution of capital as failing to be real and substantial, or find a firm ineligible, solely because:

(a) A qualifying individual acquired his or her ownership interest as the result of a gift or transfer without adequate consideration, other than the types set forth in paragraph (12) of this section;

(b) There is a provision for the co-signature of a spouse who is a non-qualifying individual on financing agreements, contracts for the purchase or sale of real or personal property, bank signature cards, or other documents; or

(c) An applicant receives ownership of the firm in question or its assets for adequate consideration from a spouse who is a non-qualifying individual.

History

Statutory/Other Authority: ORS 285A.070, ORS 285A.075(1)(a) & ORS 200.025(2)
Statutes/Other Implemented: ORS 200.005, ORS 200.055 & Oregon Laws 2023, Chapter 497
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 7-2018, minor correction filed 02/16/2018, effective 02/16/2018
OBDD 1-2016, f. & cert. ef. 1-5-16

Or. Admin. R. 123-200-1230 Determination of Independence

(1) The business must be a “for profit,” independent, properly licensed, and registered with the Secretary of State in the State of Oregon.

(2) In determining whether a certified firm is an independent business, the COBID must scrutinize relationships with non-certified firms in such areas as personnel, facilities, equipment, financial and/or bonding support, and other resources.

(3) The COBID may consider whether present or recent employer/employee relationships between the owner(s) of the applicant firm and non-certified firms, or persons associated with non-certified firms, compromise the independence of the applicant firm.

(a) The COBID may examine the applicant firm’s relationships with prime contractors to determine whether a pattern of exclusive or primary dealings with a prime contractor compromises the independence of the applicant firm.

(b) While reviewing factors related to the independence of an applicant firm, the COBID must consider the consistency of relationships between the firm and non-certified firms with normal industry practice.

(4) The COBID will consider whether the owner(s) of the applicant firm owns or leases equipment and resources necessary to perform the services provided. If the business leases equipment, leasing must follow normal industry practice and the lease must not involve a relationship with a prime contractor or non-qualifying individual that compromises the control and independence of the applicant firm.

(5) The COBID may certify a business operating under a franchise or license agreement if it meets the standards in this subpart and the franchiser or licenser does not have an affiliation with the franchisee or licensee. The franchisor or license issuer must not have the ability to control employees, location, or prevent the certified owners from making any business decision for the firm without the cooperation or vote of any non-qualifying individual.

History

Statutory/Other Authority: ORS 200.005 & 200.055
Statutes/Other Implemented: ORS 200.005, 200.055 & Oregon Laws 2023, chapter 497
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 1-2016, f. & cert. ef. 1-5-16

Or. Admin. R. 123-200-1240 Determination of Management Control

(1) All legal documents and financial statements must clearly document that the qualifying individual has management and control of the firm.

(2) The qualifying individual(s) must hold the highest officer position in the company (e.g. chief executive officer or president).

(a) In a corporation, the qualifying individual(s) must control the Board of Directors.

(b) In a partnership, one or more qualifying owner(s) must serve as general partners, with control over all partnership decisions.

(c) In order for a qualifying individual to control a partnership, any non-qualifying partners must not have the power, without the specific written concurrence of the qualifying partner(s), to contractually bind the partnership or subject the partnership to contract or tort liability.

(d) Qualifying individuals and/or firms must not be subject to any formal or informal restrictions, which limit the customary discretion of the qualifying owner(s). There can be no restrictions (i.e., through corporate charter provisions, by-laws, contracts, or any other formal or informal devices) preventing the qualifying owners from making any business decisions for the firm without the cooperation or vote of any non-certified individual.

(3) The qualifying individual must possess sufficient knowledge, managerial and technical competence, experience, and have an overall understanding directly related to the type of business in which the firm seeks certification. The qualifying individual(s) must also be able to maintain day-to-day control over all operational aspects of the business.

(a) The COBID will evaluate the training and experience of the qualifying individual based on a variety of factors. In determining whether qualifying individual controls the applicant firm, COBID will consider all the facts in the record, viewed as a whole. The qualifying individual must be able to demonstrate clearly that he or she meets the following factors. The list is not exclusive and COBID may take additional training and experience into consideration when making a determination regarding the qualifying applicant’s qualifications. Factors include:

(A) A college degree in the field of expertise;

(B) Essential license in Oregon in the field in which the firm operates (e.g. electrician, plumber, engineer, or landscape architect, etc.) that is current and up-to-date;

(D) Experience in project management in the primary field of expertise;

(E) Individual’s presence and activity on work site and ability to determine if work is proceeding in accordance with plans and to supervise field operations, resolve problems, and answer technical questions for subordinates;

(F) Individual’s demonstration of knowledge in area of expertise during the certification interview process;

(G) Letters of reference from individuals providing same or similar types of work;

(H) Contracts, proposals, or other related documents; and

(I) Additional training and experience related specifically to construction firms.

(i) Has ability to read and interpret blueprints and specifications.

(ii) Has independently done take offs and can prepare estimates and bids.

(iii) Can operate necessary equipment (e.g. excavator, backhoe, dump truck, etc.)

(b) Quality of work performed does not determine an applicant’s eligibility for certification.

(c) In order to determine that the qualifying individual(s) has the technical expertise and competence to maintain operational control, he or she may be required to submit proof of expertise to include:

(A) A copy of his or her essential license(s).

(B) His or her resume.

(4) The qualifying individual(s) must have responsibility for the critical areas of business operations and demonstrate the ability to make independent and unilateral business decisions needed to guide the future of the business.

(5) The qualifying individual(s) must possess the power to direct or cause the direction of the management and policies of the firm and to make day-to-day as well as long-term decisions on matters of management, policy, and operations.

(6) The qualifying individual is not required to have hands-on, direct control or expertise in every aspect of the business’ affairs so long as the qualifying individual is able to intelligently use discretion, critically evaluate, and determine appropriate course of action based on information presented by employees.

(7) In order to substantiate management and control of a firm, a qualifying individual(s) cannot engage in outside employment or other business interests that conflict with the management of the firm or prevent the applicant from devoting sufficient time and attention to the affairs of the firm to control its activities.

(8) A qualifying individual may control a firm even though one or more of the individual’s immediate family members (who themselves are not qualifying individuals) participate in the firm as a manager, employee, owner, or in another capacity.

(9) When a qualifying individual obtains ownership or control of a firm and the previous owner or individual in control is a non-qualifying individual but remains active in some role at the firm, the qualifying individual must demonstrate to the COBID, by clear and convincing evidence, that:

(a) The transfer of ownership or control to the applicant was made for reasons other than obtaining certification; and

(b) The applicant actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-qualifying individual who formerly owned or controlled the firm.

(10) In considering an MBE, WBE, or VBE certification where a non-qualifying individual was formerly controlling the firm, the COBID may consider the difference between the compensation of the non-qualifying individual and the qualifying individual as a factor in determining control.

(11) If the COBID is unable to determine that the qualifying individual controls the firm, as distinct from the other individuals, then the qualifying individual has failed to carry his or her burden of proof concerning control even though they may participate significantly in the firm’s activities.

(12) Non-qualifying individuals may be involved in an MBE, WBE, and/or VBE firm as owners, managers, employers, stockholders, officers, and/or directors. Such individuals must not, however, possess or exercise the power to control the firm or be disproportionately responsible for the operation of the firm.

(13) The qualifying individual may delegate various areas of management, policymaking, or daily operations of the firm to other participants in the firm, regardless of whether these participants are qualifying individuals. Such delegation of authority must be revocable, and the certified owner(s) must retain the power to hire and fire any person to whom they delegate such authority. The managerial role of the certified owner(s) in the firm’s overall affairs must be such that the COBID can reasonably conclude that the certified owner(s) actually exercises control over the firm’s operations, management, and policy.

(14) The qualifying individual controlling a firm may use an employee leasing company. The use of such a company does not preclude the certified individual(s) from controlling the firm if he or she continues to maintain an employer-employee relationship with the leased employees.

(15) When a firm contracts out the actual management of the business to individuals other than the owner or delegates the management to employees, those persons who have the power to hire and fire these managers exercise management control.

(16) In determining whether qualifying individual controls a firm, the COBID may consider whether the firm owns equipment necessary to perform its work. The business must own or lease sufficient machinery, equipment, and employees to operate. In making this determination, the COBID shall compare the operations of the certified firm to a non-certified firm in the same or similar business. If leasing, it must be a normal industry practice and the lease must not involve a relationship with a prime contractor or non-qualifying individual that compromises the control or independence of the firm as referenced under OAR 123-200-1100(5).

(17) The COBID may grant certification to a firm only for specific types of work in which the qualifying individual has the ability to control the firm. To gain certification in an additional type of work, the qualifying individual needs to demonstrate to the COBID that only its certified owner(s) controls the firm with respect to that type of work.

(a) The North American Industry Classification System (NAICS) codes assigned to the firm must describe the types of work the qualifying individual can control and manage and must directly relate to the services provided by the firm.

(b) The applicant bears the burden of providing the necessary, detailed company information to COBID for it to make an appropriate NAICS code designation and is primarily responsible to ensure the codes remain current to reflect services provided.

(c) In order for certified individuals to control a partnership, any non-certified partners must not have the power, without the specific written concurrence of the certified partner(s), to contractually bind the partnership or subject the partnership to contract or tort liability.

History

Statutory/Other Authority: ORS 285A.070, 285A.075(1)(a) & ORS 200.025(2)
Statutes/Other Implemented: ORS 200.005, 200.055 & Oregon Laws 2023, Chapter 497
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 7-2019, amend filed 06/05/2019, effective 06/05/2019
OBDD 1-2019, temporary amend filed 01/07/2019, effective 01/07/2019 through 07/05/2019
OBDD 9-2018, temporary amend filed 02/20/2018, effective 02/20/2018 through 08/17/2018
OBDD 1-2016, f. & cert. ef. 1-5-16

Or. Admin. R. 123-200-1300 Certification: Application and Procedure

(1) Businesses seeking certification must complete the Certification Application provided by the COBID.

(2) Applicants seeking certification as an Airport Concession Disadvantage Business Enterprise (ACDBE) or Disadvantage Business Enterprise (DBE) through COBID must meet the eligibility criteria set out in 49 CFR parts 23 and 26 and any written directives, administrative guidelines, and written decisions of the U.S. Department of Transportation.

(3) Applicants seeking certification as a MBE, WBE, VBE or ESB must meet the eligibility criteria set out in ORS Chapter 200 and OAR 123-200-1000 to OAR 123-200-2300.

(4) A completed application, together with all required supporting documentation, shall be submitted through the e-application process, by mail or in person to the Certification Office for Business Inclusion and Diversity, 775 Summer St. NE, Suite 200, Salem OR 97301. The COBID will not process incomplete applications.

(5) The COBID will take action on completed applications as promptly as its resources permit. The order of priority for processing applications shall be the date the COBID receives the complete application including all supporting documentation.

(6) The COBID may conduct a phone interview or on-site investigation at the applicant’s place of business and/or jobsite if applicable. The purpose of the interview and/or site visit is to verify material submitted with the application and to substantiate eligibility.

(7) As part of its investigation, the COBID may require applicants to provide information in addition to that requested on the application. The applicant has the burden of proving that he or she is eligible for certification.

(8) The applicant must cooperate fully with the investigation and make available any additional information requested by the COBID.

(9) The COBID shall notify applicants promptly by mail after making a decision. When the COBID denies an application, the letter shall set forth the specific reasons for the denial.

(10) In making certification determinations under this section, the COBID does not consider whether the business has previously performed or would be able to perform a commercially useful function. Repeated failure by a business to perform a commercially useful function may indicate, however, that the business is not independent, owned, or controlled by a qualifying individual.

[Publications: Publications referenced are available from the agency.]

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0040, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Or. Admin. R. 123-200-1400 Certification Review

(1) All certifications are valid for three years.

(2) The COBID will send an annual “no change” statement to firms, approximately 30 days prior to the one-year and two-year anniversaries of the certification date. The applicant must complete the statement, provide federal tax information for the previous year, and provide documentation supporting any changes prior to the anniversary date, or the COBID will decertify the firm.

(3) The COBID will send a certification review notice to certified firms approximately two months prior to the firm’s anniversary date. The applicant shall promptly return the application along with any requested documentation (e.g., by-law amendments, evidence of changes in ownership, etc.). The COBID will review the signed application to determine continued eligibility and may conduct an on-site investigation to verify information submitted.

(4) The qualifying individual must demonstrate that his or her business currently meets the qualifications for the requested certification. It is the responsibility of the qualifying individual to provide the information deemed necessary by the COBID to ascertain eligibility. Failure to return the certification review form or provide supporting documentation may lead to decertification.

History

Statutory/Other Authority: ORS 200.005
Statutes/Other Implemented: ORS 200.006
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-1500 Denial and Decertification of MBE, WBE, and VBE Firms

(1) The COBID may deny or decertify a firm at any time it determines that the firm does not or no longer meets the eligibility standards set out in OAR 123-200-1000 through 123-200-2300 and ORS 200.005. The procedure is as follows:

(a) In the case of denial of initial certification, the COBID will notify the applicant in writing of the denial and provide a detailed explanation supporting the reasons for denial.

(b) In the case of decertification, the COBID shall issue a Notice of Intent to Decertify the firm 21 days prior to the date of decertification and provide a detailed explanation to support the reasons for the determination.

(c) In the event of a denial or decertification, the applicant or certified firm has 21 calendar days from the date of notice in which to submit a written appeal to the manager of the COBID. Following the review of the applicant’s written appeal, the manager of the COBID will issue a decision.

(d) If the applicant or certified firm does not agree with the manager’s decision, he or she may request a contested case hearing. The COBID will conduct a contested case hearing in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the manager of the COBID for issuance of a final order.

(e) If the applicant or certified firm files an appeal in writing or requests a contested case hearing, the COBID will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the COBID within the 21-day period, the denial or decertification shall be final.

(2) The COBID may decertify a firm if the qualifying individual leaves the business or dies.

(3) An individual may withdraw his or her application or certification if he or she no longer wishes to participate in the program. The applicant must complete a notarized withdrawal form provided by the COBID.

(4) Any business denied initial certification is ineligible to reapply for a period of 12 months.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.005
OBDD 13-2024, amend filed 06/04/2024, effective 06/04/2024
OBDD 34-2023, temporary amend filed 12/28/2023, effective 01/01/2024 through 06/28/2024
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-1600 Emerging Small Business (ESB) Certification Procedures — Eligibility Standards

(1) The ESB program is race and gender neutral and is based on the size of the business, not the individual applicant.

(2) A firm’s certification as an ESB may only last for a maximum of 12 consecutive years from the original certificate date and qualify as a tier one or tier two firm.

(a) A certified firm may only remain in each tier for a period of six years.

(b) If the firm graduates to a tier two status, due to size, before exhausting six years of certification under tier one, the firm’s certification in tier two must not exceed a period of six years, regardless of the firm’s certification period as tier one.

(c) If an applicant provides compelling information to show, to the satisfaction of the COBID, that he or she has not received an opportunity to bid on ESB projects during the 12 years of eligibility, the COBID will extend the certification of the firm for one additional year. A firm may receive the extension only once. The firm must provide a written request for an extension to the COBID, including any supporting documentation.

(3) To be eligible for certification as an ESB, a firm must meet the following criteria:

(a) Be in existence, operational, and in business for a profit.

(b) The principal place of business must be located in the State of Oregon as determined by the address used to file federal income taxes. If the business uses a P.O. Box, the COBID may require additional documentation to verify location.

(c) Be properly licensed and legally registered with the Secretary of State in the State of Oregon (i.e. registered as a domestic corporation, limited liability corporation, partnership, or assumed business name, etc.).

(d) Must not be a subsidiary or parent company belonging to a group of firms that are owned or controlled by the same individuals if, taken together, the group of firms do not qualify.

(e) Have average, annual gross receipts over the last three years that do not exceed monetary limitations determined by OBDD/COBID annually based on the Consumer Price Index.

(f) If state or local law requires a person to have a particular license or other credential in order to own and/or control a certain type of firm, then the certified applicant(s) who owns and controls an ESB must possess the required license or credential.

(g) The owner(s) must work a minimum of 20 hours per week for the business.

(h) The business must have 19 or fewer full-time employees to qualify for tier one or have 29 or fewer full-time employees to qualify to tier two. The COBID calculates a full-time employee as follows:

(A) Hours worked by all employees (part-time, seasonal, or full-time) shall be converted into equivalent hours; dividing the total hours worked by 2080.

(B) The COBID does not consider owners of the business in the calculation of the equivalent employees.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-1610 Oregon Small Business Enterprise (OSBE) - Eligibility Standards

(1) The OSBE program is for Oregon-based businesses only, is race and gender neutral and based on the size of the business.

(2) To be eligible for certification as an OSBE, a firm must meet the following criteria:

(a) Be in existence, operational, and in business for a profit in Oregon. To meet this requirement a firm must:

(A) Be physically located in the State of Oregon as determined by the address used to file federal income taxes. If the principal place of business uses a P.O. Box, COBID will require additional documentation to verify location.

(B) Be legally registered as a Domestic corporation, limited liability corporation, partnership, or assumed business name with the Secretary of State in the State of Oregon.

(D) Not be a subsidiary or parent company belonging to a group of firms that are owned or controlled by the same individuals if, taken together, the group of firms do not qualify. Independence will be determined by the following:

(i) Control of day-to-day operations of the firm is maintained by the owners of the firm.

(ii) Affiliated businesses being evaluated for independence and gross receipts combined with the certified firm.

(iii) The applicant firm cannot be owned or controlled by another firm, conglomerate, ESOP, nonprofit, trust, or franchisor.

(b) Average annual gross receipts over the last three years do not exceed monetary limitations determined by COBID based on the firm’s primary NAICS codes.

(c) Have an annual average of 50 or fewer full-time, part-time, or seasonal employees to qualify. COBID calculates a full-time employee as follows:

(A) Hours worked by all employees (part-time, seasonal, or full-time) shall be converted into equivalent hours; dividing the total hours worked by 2080.

(B) COBID does not consider owners of the business in the calculation of the equivalent employees.

(d) If state or local law requires a firm to have a particular license or other credential to own and/or control a certain type of firm (i.e. CCB, LCB, etc.) then the certified applicant(s) who owns and controls an OSBE must possess the required license or credential.

(e) If individual professional licensing, as generally required by industry (i.e., engineer, architect, plumber, electrician, landscape architect, CDL, arborist, lawyer, medical, etc.), is required to perform the firm’s primary scope of work, the licensing must be current and held by the owner or a W-2 employee of the firm.

(3) An OSBE may only be certified for specific types of work in which the firm has the ability to perform. COBID will make this determination as follows:

(a) The North American Industry Classification System (NAICS) codes assigned to the firm must directly relate to the primary services provided by the firm.

History

Statutory/Other Authority: ORS 200.055 & HB 2337 (2025)
Statutes/Other Implemented: HB 2337 (2025) & ORS 200.005
OBDD 6-2026, adopt filed 04/02/2026, effective 04/02/2026

Or. Admin. R. 123-200-1620 Certification Review of OSBE Firms

(1) COBID will send an annual “no-change” statement to firms approximately 30 days prior to the one-year anniversary of the certification date. The applicant must submit a completed statement, along with federal tax information for the previous year and documentation of any changes, prior to the anniversary date or the firm will be decertified. Continued certification is not automatic. The applicant must demonstrate that his or her business still meets the criteria set out in OAR 123-200-1610.

(2) The OSBE firm shall notify COBID within 30 days of any changes which may affect its continued eligibility in the program.

(3) COBID staff shall review the signed application to determine the firm has continued eligibility. COBID may also request additional information to verify the firm has continued eligibility.

(4) Failure to return the completed review application by the anniversary date shall result in decertification.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.005
OBDD 6-2026, adopt filed 04/02/2026, effective 04/02/2026

Or. Admin. R. 123-200-1630 Denial and Decertification of OSBE Firms

(1) This rule applies only to the denial and decertification of a firm’s OSBE status under Oregon law. COBID may deny certification or decertify a firm at any time if the agency determines that the firm no longer meets eligibility standards set out in OAR 123-200-1610. The procedure is as follows:

(a) COBID will issue a Notice of Intent to Deny Certification in the case of denial of initial certification and indicate the specific reasons for the decision.

(b) In the case of decertification, COBID shall issue a Notice of Intent to Decertify the firm 21 days prior to the date of decertification and indicate the specific reasons for the decision.

(c) In the event of a denial or decertification, the applicant or firm representative has 21 calendar days from the date of notice in which to submit a written appeal to the program manager of COBID. Following the review of the applicant’s written appeal, the program manager will issue a decision.

(d) If the applicant or firm representative does not agree with the manager’s decision, he or she may request a contested case hearing. COBID will conduct a contested case hearing in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to COBID. The program manager of COBID will issue a final order.

(e) If the applicant or firm representative files an appeal in writing or requests a contested case hearing, COBID will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to COBID within the 21-day period, the denial or decertification shall be final.

(2) An applicant or firm representative may withdraw an application or certification if there is no longer a desire to participate in the program or if eligibility is unable to be met at the time of review.

(3) Any business denied initial certification would be ineligible to reapply for a period of up to 12 months.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.005
OBDD 6-2026, adopt filed 04/02/2026, effective 04/02/2026

Or. Admin. R. 123-200-1700 ESB Certification: Application Form and Procedure

(1) The COBID will utilize ORS 200.170 to review a business’ eligibility for certification as an ESB.

(2) A firm wishing to apply for certification in the ESB program shall complete the application provided by the COBID.

(3) The completed application, together with all required supporting documentation, shall be submitted to the Certification Office for Business Inclusion and Diversity at 775 Summer Street NE, Suite 200, Salem, OR 97301. The COBID will not process incomplete applications.

(4) The COBID will conduct a review and take action on completed applications as promptly as resources permit. The order of priority for processing applications shall be the date the COBID receives the completed application with all supporting documentation.

(5) The COBID shall make a determination based on the eligibility standards included in these rules and the applicable laws of the State of Oregon. As part of its investigation, the COBID may require the applicant firm to provide information in addition to that requested on the application. The applicant(s) has the burden of proving the firm is eligible for certification and meets all the requirements of the program. If the COBID certifies the firm, the agency will send a confirmation letter.

(6) The applicable emerging small business size standard for each applicant set out in ORS 123-200-1600 shall be determined by the business’ primary service offered.

(7) Registration of the business with the Construction Contractors Board and/or Landscape Contractors Board will establish a firm as a construction firm. For the purposes of this program, the COBID will consider a construction-related trucking business as a construction firm. The COBID does not consider Engineering and Architecture firms as construction firms.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055 & 200.170
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-1800 Certification Review

(1) Certification as an ESB is valid for three years from the date of certification.

(2) The COBID will send an annual “no-change” statement to firms approximately 30 days prior to the one-year and two-year anniversaries of the certification date. The applicant must submit a completed statement, along with federal tax information for the previous year and documentation of any changes, prior to the anniversary date or the firm will be decertified.

(3) The ESB shall notify the COBID within 30 days of any changes, which may affect its continued eligibility in the program. Failure to notify the COBID may result in denial or decertification.

(4) The COBID will send a certification review notice and application to certified firms 60 days prior to expiration of current certification. The applicant shall promptly return the completed application along with any requested documentation (i.e. evidence of change in ownership, federal tax returns for the last year, etc.). Continued certification is not automatic. The applicant must demonstrate that his or her business still meets the criteria set out in OAR 123-200-1600 through 123-200-1700.

(5) The COBID staff shall review the signed application to determine the firm has continued eligibility. The COBID may also request additional information to verify the firm has continued eligibility.

(6) Failure to return the completed review application by the expiration date shall result in decertification.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-1900 Denial and Decertification of ESB Firms

(1) This rule applies only to the denial and decertification of a firm’s ESB status under Oregon law. The COBID may deny certification or decertify a firm at any time if the agency determines that the firm no longer meets eligibility standards set out in OAR 123-200-1600. The procedure is as follows:

(a) The COBID will issue a Notice of Intent to Deny Certification in the case of denial of initial certification and the reasons therefore.

(b) In the case of decertification, the COBID shall issue a Notice of Intent to Decertify the firm 21 days prior to the date of decertification, and indicate the specific reasons for the decision.

(c) In the event of a denial or decertification, the applicant or firm representative has 21 calendar days from the date of notice in which to submit a written appeal to the manager of the COBID. Following the review of the applicant’s written appeal, the manager of COBID will issue a decision.

(d) If the applicant or firm representative does not agree with the manager’s decision, he or she may request a contested case hearing. The COBID will conduct a contested case hearing in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the COBID. The manager of the COBID will issue a final order.

(e) If the applicant or firm representative files an appeal in writing or requests a contested case hearing, the COBID will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the COBID within the 21-day period, the denial or decertification shall be final.

(2) An applicant or firm representative may withdraw an application or certification if there is no longer a desire to participate in the program. The applicant or firm representative must complete a withdrawal form provided by the COBID.

(3) Any business denied initial certification would be ineligible to reapply for a period of 12 months.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055 & 183.310 - 183.550
OBDD 1-2016, f. & cert. ef. 1-5-16
OBDD 7-2013, f. & cert. ef. 9-3-13

Or. Admin. R. 123-200-2000 Complaints of Ineligibility for All Programs

(1) A complainant must submit a Complaint of Ineligibility regarding certification of an individual or firm to the COBID. The COBID will process complaints according to the following procedure:

(a) Any individual or agency who believes that an individual or certified firm does not qualify under the standards of eligibility for certification may file a complaint of ineligibility. The complainant(s) must fill out a formal complaint form provided by the COBID. The purpose of the complaint process is to maintain the transparency of all programs.

(b) The complainant must use the form provided and submit the document to the COBID setting forth facts, which indicate that the applicant or certified firm is not eligible. The complaint must include copies of any supporting documents the complainant(s) may possess. The complainant(s) shall describe the facts in as much detail as possible.

(c) The COBID will only investigate complaints based on firsthand knowledge and those that contain allegations supported by evidence. The COBID will not investigate anonymous or third party complaints. Complaints based on hearsay (i.e. third person account, general assumption, word-of-mouth, and/or speculation) will not be investigated. The COBID does not accept general allegations. The COBID will not investigate unsupported complaints and will return the document to the complainant.

(2) The COBID will notify the complainant(s) in writing when it refuses to investigate a complaint. The notification may include:

(a) The initial complaint filed by the complainant(s);

(b) Explanation of why the complaint is not being investigated; and

(3) The complainant(s) may submit a revised complaint addressing the COBID’s concerns.

(4) The complainant(s) must sign the complaint and provide a physical mailing and email address, and telephone number where the COBID may reach the individual during the investigation.

(5) While responding to requests for information concerning any aspect of the programs, the COBID complies with provisions of the Federal Freedom of Information and Privacy Acts. The COBID may make available to the public any information concerning the programs not prohibited by federal or state law. Information submitted to the COBID is subject to public record law, ORS 192.410, 192.501, 192.502, and 192.505. The public may inspect certain information in the agency’s possession. The information may include names of the complainant. Certain other records the COBID may keep confidential, under certain circumstances. These may include, but are not limited to: reports from creditors, employers, customers, suppliers, financial statements, tax returns, business records, employment history and other personal data submitted by the applicant, customer lists, bids, proposals, and contracting information, production, sales or cost data, and marketing strategy information. Although the agency will attempt to keep the information submitted confidential, it cannot guarantee confidentiality in all cases.

(6) The COBID may keep the identity of the complainant(s) confidential, at the complainant(s) election, throughout the course of the investigation. A complainant(s) may waive this privilege of confidentiality at any time. If such confidentiality will hinder the investigation, proceeding, hearing, or result in a denial of appropriate administrative due process to other parties, the COBID will advise the complainant(s) that, in some circumstances, failure to waive the privilege of confidentiality may result in the closure of the investigation or dismissal of the proceeding or hearing.

(7) The COBID will investigate each complaint as promptly as resources allow. If preliminary investigative results show good cause for in-depth investigation, the COBID will notify the applicant or certified firm identified in the complaint by certified mail. The notice will summarize the grounds for the challenge and will require the applicant or certified firm to provide to the COBID, within a reasonable period of time, information sufficient to permit the agency to evaluate the complaint and the application or certified firm’s qualifications for the programs. The applicant, certified firm, and complainant(s) shall cooperate fully in the COBID's investigation.

(8) After the investigation is complete, the COBID will issue a written decision in the form of a rejection of the complaint, Notice of Intent to Deny, or Notice of Intent to Decertify. The decision will address each issue raised in the complaint and throughout the investigation and the reasoning for the decision. The COBID will mail the written decision to the applicant or certified firm and to the complainant(s). The COBID will not deny or decertify a firm based on a complaint without first giving the firm an opportunity to respond.

(9) The applicant or certified firm has 21 calendar days from the date of Notice of Intent to Deny or Notice of Intent to Decertify in which to submit a written appeal to the manager of the COBID. Following the review of the applicant’s written appeal, the manager of COBID will issue a decision.

(10) If the applicant or certified firm does not agree with the manager’s decision, he or she may request a contested case hearing. The COBID will conduct a contested case hearing in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the manager of the COBID for issuance of a final order.

(11) If the applicant or certified firm files an appeal in writing or requests a contested case hearing, the COBID will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the COBID within the 21-day period, the denial or decertification shall be final.

(12) The COBID will not consider opposing information received about an applicant prior to the initial certification as a complaint, but will consider the information in the investigation of the application for certification.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055
OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0090, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Or. Admin. R. 123-200-2200 Representation of the COBID by Officer or Employee in Contested Case Hearings

(1) An officer or employee of the COBID may appear on behalf of the COBID in contested case hearings, subject to the approval and authorization of the Attorney General.

(2) The COBID representative may not make legal argument on behalf of the COBID.

(a) "Legal argument" includes arguments on:

(A) The jurisdiction of the COBID to hear the contested case;

(B) The constitutionality of a statute, rule, or the application of a constitutional requirement to the COBID; and

(b) "Legal argument" does not include presentation of evidence, examination and cross-examination of witnesses, presentation of factual arguments, or arguments on:

(A) The application of the facts to the statutes or rules directly applicable to the issues in the contested case;

(B) Comparison of prior actions of the COBID in handling similar situations;

(D) The admissibility of evidence of the correctness of procedures followed.

(3) When an officer or employee of the COBID represents the agency, the presiding officer shall advise the representative of the manner in which to make objections and which matters to preserve for appeal. Such advice is of a procedural nature and does not change applicable law on waiver of the duty to make timely objection. Where such objections involve legal argument, the presiding officer shall provide reasonable opportunity for the agency officer or employee to consult legal counsel and permit such legal counsel to file written legal argument within a reasonable time after conclusion of the hearing.

History

Statutory/Other Authority: ORS 183.450(7) & 183.450(8)
Statutes/Other Implemented: ORS 183.450(7)(b)
OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0190, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Or. Admin. R. 123-200-2210 Contracting Agency Responsibilities

(1) It is the public agency’s sole responsibility to perform commercially useful function (CUF) reviews.

(2) The COBID may consider and review the CUF reviews completed by the public contracting agency or any other relevant factors when determining whether the certified firm has exhibited a pattern of failing to perform CUFs.

(3) Notwithstanding any other part of this section, the COBID and a public contracting agency may enter into an agreement to share and protect information and otherwise cooperate in order to facilitate the enforcement of ORS 200.065 and ORS 200.075, as permitted by ORS 192.410 to 192.505.

(a) The COBID, for purposes of an investigation regarding certification, will consider CUF reviews under the following circumstances:

(i) During the course of a project

(ii) When multiple reviews occur over an extended period suggesting reoccurring violations

(iii) Within three years of the discovery of an alleged CUF failure.

(4) CUF reviews and investigations shall consider the following:

(a) Whether the certified firm is responsible for execution of the work outlined in the public contract and carries out its responsibilities by actually performing, managing, and supervising the work involved. The public agency may evaluate the amount of work contracted and standard industry practices.

(b) Whether a certified firm is responsible, with respect to materials and supplies used on the contract, for negotiating price; determining quality and quantity; ordering the material and installing (where applicable); and paying for the material.

(c) Whether a certified firm has a role that is limited to that of an extra participant in a transaction, contract, or project through which participants pass funds in order to obtain the appearance of involvement by the certified firm. In determining whether a certified firm is such an extra participant and thus not performing a CUF, the public agency may examine similar transactions, particularly those in which non-certified firms participate.

(d) Whether a certified firm performs or exercises responsibility for at least 30 percent of the total cost of its contract with its own work force or subcontract with another firm certified by the State of Oregon. If it does not, the public agency may presume the certified firm is not performing a CUF. The firm must not subcontract a greater portion of the work of a contract to a non-certified firm than would be expected based on normal industry practice for the type of work involved.

(5) If a public agency determines that a certified firm is not performing a CUF as provided in paragraph (4) (b), (c), and (d) of this section, the certified firm may present evidence to rebut this presumption. The public agency may determine that the firm is performing a CUF given the type of work involved and normal industry practices.

(6) A public agency shall notify the COBID if the agency investigates a certified firm.

(7) The COBID may not decertify a firm based solely on a public agency’s investigation.

(8) COBID, at its discretion, may perform its own investigation of a certified firm if it receives a complaint or notification that alleges a certified firm has failed to perform a CUF. As part of its investigation, COBID may request information from the complainant or author of the notification unless such requirements violate an agreement entered into by the public contracting agency and COBID under (3) of this section. If COBID does not receive sufficient information to conduct an investigation, COBID may in its discretion close the investigation without taking further action. Requested information may include:

(a) All documentation gathered by the public contracting agency during the CUF review and any additional documentation related to the complaint or investigation.

(b) Disclosure of all participants in a complaint or investigation.

(c) Confirmation that the public contracting agency notified the firm in question that it failed a CUF review and provided the firm an opportunity to present evidence to rebut the claim.

(d) List of current, open contracts let to the firm in question by the public contracting agency.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055 & 200.065 and ORS.075
OBDD 1-2016, f. & cert. ef. 1-5-16

Or. Admin. R. 123-200-2300 Directory

The COBID shall maintain a statewide-unified directory of certified firms as follows:

(1) Certified firms shall use the current business name as registered with the Secretary of State, Corporation Division. Businesses operating under the owner’s individual name shall use the name listed on the business license. The firm may not use other names when contracting business. A firm may use an Assumed Business Name for contracting purposes, but only if the name is in conjunction with the registered business name.

(2) The directory will be maintained in an electronic format and available on-line. The directory shall indicate the certification status of each firm for all programs. The directory shall also include the firm’s telephone numbers, fax number, and mailing address and list the firm's capabilities.

(3) The COBID shall update the directory on a daily basis including changes in business and email addresses and phone number(s).

(4) It is the responsibility of the applicant and certified business to notify the COBID within 30 days of any changes in its ownership or management, which may affect eligibility. Failure to notify the COBID may result in denial or decertification.

History

Statutory/Other Authority: ORS 200.055
Statutes/Other Implemented: ORS 200.055
Renumbered from 123-200-2100, OBDD 1-2016, f. & cert. ef. 1-5-16
Renumbered from 123-200-0180, OBDD 7-2013, f. & cert. ef. 9-3-13
OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10

Division 300 COMMUNITY LENDER LOAN LOSS ACCOUNT PROGRAM

Or. Admin. R. 123-300-0001 Purpose and Scope

(1) The purpose of this division of administrative rules is to carry out the provisions of the Act as they pertain to the administration of the Community Lenders’ Loan Loss Account Program. These rules provide definitions, program procedures, lender eligibility requirements, account and contract requirements for Program lenders, and Borrower loan eligibility requirements for operation of the Program.

(2) The intent of the Community Lenders’ Loan Loss Account Program is to make awards to eligible lenders, that are unable to access existing Department programs, to fund Loan Loss Reserve Accounts for the purpose of increasing their lending to business owners and entrepreneurs who lack access to capital to start or grow their businesses due to factors including, but not limited to:

(a) Limited net worth of the Borrower and its Principal(s) guaranteeing the loan;

(b) Lack of adequate business and/or personal assets available to pledge as collateral;

(d) Limited time in business and/or credit history; and,

(e) Lack of financial training and capacity to prepare and compile business plans, financial statements, and projections necessary to support a business loan request.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0101 Definitions

Terms used throughout this OAR Chapter 123, Division 300, are as defined in the Act, as provided in the Department’s Procedural Rules in OAR Chapter 123, Division 001, and herein. As used in this division of administrative rules, the following definitions apply, unless the context requires otherwise:

(1) “Act” means ORS 285B.780 to ORS 285B.799.

(2) “Agreement” means a contract between a lender and the Department authorizing the lender to participate in the Program and providing for the deposit of moneys awarded by the Department out of which the lender may be reimbursed for Principal Losses incurred due to defaults on Enrolled Loans.

(3) “Bank Short-Term Rate” means the interest rate set by the market and which is published by the Wall Street Journal.

(4) “Business” or “Borrower” means a corporation, partnership, limited liability company, joint venture, sole proprietorship, cooperative, or non-profit corporation.

(5) “Claim” means a lender’s written request to the Department to authorize the withdrawal of funds from the lender’s Loan Loss Reserve Account to offset a Principal Loss resulting from the default of an Enrolled Loan.

(6) “Community Development Financial Institution” or “CDFI” means a lender certified as such by the Community Development Financial Institutions Fund at the United States Department of the Treasury, that is not a financial institution as defined by ORS 706.008 and that maintains an office in this state.

(7) “Community Lender” means a Qualified Lender that is not eligible to participate in the Department’s Capital Access Program established by ORS 285B.109 to 285B.119 or Credit Enhancement Fund program established by ORS 285B.200 to ORS 285B.218 because the lender is not a financial institution as that term is defined by ORS 706.008.

(8) “Department” means the Oregon Business Development Department as established by ORS 285A.070.

(9) “Director”, “executive officer”, “immediate family”, “principal shareholder” and “related interest” have the meanings given those terms in 12 C.F.R part 215.2 (2021).

(10) “Enrolled Loan” means a Qualified Loan accepted by the Department for enrollment in the Program.

(11) “Fund” means funds appropriated to the Department for making Program awards to eligible lenders.

(12) “Loan Loss Reserve Account” means an account established by a lender and the Department, in accordance with department policy for the benefit of the lender, for the deposit of moneys awarded from the Fund for use as provided by the Program requirements.

(13) “Prime Rate” has the meaning given that term in ORS 285B.784(2).

(14) “Principal”, when used in regard to a Business seeking funding from a Community Lender, is defined as:

(a) The proprietor if the Business is a sole proprietorship.

(b) Each managing partner and each partner who is a natural person and holds a 20% or more ownership interest in the partnership if the Business is a partnership.

(c) Each director, each of the five most highly compensated executives or officers of the entity, and each natural person who is a direct or indirect holder of 20% or more ownership stock or stock equivalent of the entity, if the Business is a corporation, limited liability company, association, cooperative or a development company.

(15) “Principal Loss,” “Loss,” and “Losses” means the principal amount due under an Enrolled Loan, and not paid by a Borrower in default as described in OAR 123-300-1001. Principal Loss does not include unpaid accrued interest, fees, legal expenses, costs incurred in the liquidation of assets, costs incurred in realization of personal or other financial guarantees, or other costs incurred by the lender related to the defaulted Enrolled Loan.

(16) “Program” means the Community Lenders’ Loan Loss Account Program established by the Act and as implemented by the rules herein.

(17) “Qualified Business” or “Qualified Borrower” means a person that operates a business in Oregon, or attests to a qualified lender that the person will use proceeds from a qualified loan to establish a business in Oregon.

(18) “Qualified lender” means a lender that has an established physical presence in Oregon and at least five years of lending experience to Oregon based businesses and that is one or more of the following:

(a) A CDFI; or

(b) A nonprofit corporation as defined in ORS 307.130; or

(c) An economic development district in Oregon designated by the Economic Development Administration of the United States Department of Commerce; or

(d) Affiliated with a local government as defined in ORS 174.116.

(19) “Qualified Loan” means a loan made, or an operating line of credit extended, by a lender to a qualified business for which the Principal Losses are reimbursable from moneys in the lender’s Loan Loss Reserve Account if the loan is enrolled by the Department in the Program.

(20) “RFP” means a request for proposal.

(21) “Socially and Economically Disadvantaged Individual” or “SEDI” means an individual who has had their access to credit on reasonable terms diminished as compared to others in comparable economic circumstances, due to their:

(a) membership of a group that has been subjected to racial or ethnic prejudice or cultural bias within American society;

(b) gender;

(d) limited English proficiency;

(e) physical handicap;

(f) long-term residence in an environment isolated from the mainstream of American society;

(g) membership of a federally or state-recognized Indian Tribe;

(h) long-term residence in a rural community;

(i) residence in a U.S. territory;

(j) residence in a community undergoing economic transitions (including communities impacted by the shift towards a net-zero economy or deindustrialization); or

(k) membership of another “underserved community” as defined in Executive Order 13985.

(22) “SEDI-owned business” means being a Business that is:

(a) Owned and controlled by Socially and Economically Disadvantaged Individuals;

(b) Owned and controlled by individuals whose residences are in a CDFI Investment Area as defined in 12 C.F.R. part 1805.201(b)(3)(ii);

(d) Located in a CDFI Investment Area as defined in 12 C.F.R. part 1805.201(b)(3)(ii).

(23) “Underserved” under the Act means a SEDI or a SEDI-owned business.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0201 Authority to Implement the Program

The manager of the Department’s Business Finance programs, or their designee, may execute documents reasonably necessary or convenient to implement and administer the Program.

History

Statutory/Other Authority: ORS 285A.075
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0301 Lender Eligibility and Award Procedure

(1) Program awards to lenders will be made through a competitive RFP process administered by the Department, of which no more than 10% of the available funds may be awarded to any single lender as a result of any RFP process.

(2) The Department shall determine a lender’s eligibility to participate in the Program, based on the submitted proposal and other information the Department may deem necessary. An eligible Program lender is one that is both:

(a) A Qualified Lender; and,

(b) Meets the criteria of a Community Lender.

(3) The Department shall evaluate Program proposals submitted in response to an RFP from eligible lenders according to the following criteria:

(a) The number of loans closed, the value of loans closed, and the value of the total project costs annually for the 5-year period preceding the submission of the lender’s proposal that were made to Oregon based businesses;

(b) Historical performance of loans made by the lender;

(c) The projected loan production and portfolio performance, including assumptions for the projections, over the 10-year compliance period of the award;

(d) How the lender proposes to increase the accessibility of capital for SEDIs and SEDI-owned businesses through its outreach, application process, underwriting criteria and lending terms that are designed to reduce historic barriers to capital;

(e) How the lender proposes to provide, or collaborate with providers of, technical assistance and financial literacy services to SEDIs and SEDI-owned businesses;

(f) How the lender’s service area and loans made under the program will support regionally diverse and rural areas of this state;

(g) The underwriting standards, loan loss provisions, loan terms and conditions the lender proposes to use when evaluating and establishing a reasonable determination of the Borrower’s ability to service the debt and repay the loan obligation in;

(h) The lender’s proposed standard documentation requirements for Enrolled Loans, including information on default provisions;

(i) How the lender’s assistance will create a path for Borrowers to graduate to traditional, low-cost forms of private capital through partnerships with, and utilization of, programs administered by Business Oregon, federal agencies and private financial institutions as defined by ORS 706.008;

(j) The lender’s plans and strategies to maintain a self-sustaining loan loss reserve account necessary to continue to increase the accessibility of capital for Oregon businesses, including SEDIs and SEDI-owned businesses, through small business loans; and

(k) The lender’s overall financial health. including the viability of the lender and the lender’s business lending portfolio(s).

(4) After reviewing and evaluating proposals, the Department shall reject or accept proposals and determine the award amount for each accepted proposal from eligible lenders.

(5) The Department may make a conditional award to an eligible lender, subject to modifications to the lender’s proposal and the Departments’ acceptance of the amended proposal for the lender to meet the evaluation criteria.

(6) As soon as practicable after the awards are finalized, the Department shall notify the lenders that submitted proposals for the RFP of the results and offer the awards to the lenders whose Program proposals are accepted.

(7) A lender shall accept a Program award offer by timely entering into an Agreement for a Program award with the Department as described in OAR 123-300-0401 within 90 days of the award. After 90 days, an award will be rescinded and may be reallocated, at the Department’s sole discretion, to other Qualified Lenders from the RFP.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 279B
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0401 Agreement

An Agreement for a Program award that the Department enters into with a lender shall provide:

(1) That the lender’s sole remedy against the State of Oregon and the Department under the Agreement is limited to the Program award amount provided under the Agreement, less any payments made under the Loan Loss Reserve Account and less any claims the Department has against lender;

(2) That the terms and conditions of Enrolled Loans are to be determined solely by the lender and Borrower which shall be in compliance with the Act, this divisions of the administrative rules, and the Program proposal from the lender as accepted by the Department;

(3) A required process and form for enrolling Qualified Loans in the Program;

(4) A required collection practice and minimum standards that the lender must utilize for Enrolled Loans;

(5) A Claim process and form for reimbursement of Losses that have been incurred from defaults on Enrolled Loans;

(6) For the creation of a segregated Program Loan Loss Reserve Account by the lender in compliance with the Act and the rules herein during the term of the Agreement;

(7) For payment from the Loan Loss Reserve Account to the lender to reimburse eligible Losses, up to the total amount of the then current balance available in the Loan Loss Reserve Account;

(8) Conditions for Agreement termination by the Department including termination of enrollment of new Qualified Loans under the Program;

(9) For the Department’s remedies for lender’s termination, withdrawal or default of the Agreement, including recovery of any remaining balance in the Loan Loss Reserve Account and repayment of any amount lender inappropriately expended from the Loan Loss Reserve Account;

(10) For withdrawal by the lender from the Program;

(11) Lender annual reporting requirements to the Department in accordance with ORS 285B.794;

(12) For required record maintenance and the Department and Secretary of State’s access to records, reports, files, etc. pertaining to the administration, receipt and use of Program funds and necessary to facilitate reviews and audits of the lender’s pertinent files related to Enrolled Loans;

(13) For lender to warrant and covenant its ability to implement the Program and execute Qualified Loans as part of its business lending portfolio(s);

(14) Criteria and requirements necessary to release lender from obligations under the Agreement and use remaining balance of the Loan Loss Reserve Account to the lender as detailed in OAR 123-300-1901 and ORS 285B.797;

(15) Incorporation of the terms of the lender’s Program proposal accepted by the Department in response to an RFP; and,

(16) For other terms and conditions as the Department may require.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 279B
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0501 Establishing a Loan Loss Reserve Account; State Transfer of Award funds to Account

(1) Within 30 days after the Department and lender execute an Agreement, lender and Department shall establish a Loan Loss Reserve Account in accordance with the Department’s policies for the benefit of (“FBO”) the lender to receive the Program Award. The Loan Loss Reserve Account shall be a segregated account established and maintained with a financial institution, as defined in ORS 706.008. The Department requires use of an interest-earning demand deposit account and only Program Award funds and earnings on the Award may be held in the account unless otherwise agreed to by the lender and the Department.

(2) Lender shall confirm in writing to the Department the establishment of the Loan Loss Reserve Account as required in section (1) of this rule and provide information necessary to facilitate the transfer of award funds to the Account within 30 days after the Department and lender execute an Agreement.

(3) The Department shall transfer from the Fund to the Loan Loss Reserve Account of a lender the amount the Department awards to the lender for the Program and that lender accepts. Such transfer shall occur within 15 days after the lender provided notice as required in section (2) of this rule.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0601 Ownership, Control, Investment of Loan Loss Reserve Account

(1) Ownership of the Loan Loss Reserve Account shall be attributed to the lender’s EIN (tax ID).

(2) The Department and the Department only shall control the Loan Loss Reserve Account and have oversight over the Account during the term of the Agreement. The Department may authorize the lender’s withdrawal and use of a specified amount of funds from a Loan Loss Reserve Account only as provided in this division of administrative rules and the Agreement, namely for approved Enrolled Loan Loss, or upon release of a lender from an Agreement.

(3) Until such time that a lender achieves all the requirements specified in the Agreement for the 10-year maintenance period and is released from their obligations under the Agreement, the balance of all moneys in the lender’s Loan Loss Reserve Account are subject to return and repayment to the State of Oregon, acting by and through the Department.

(4) Any earnings on the balance in a Loan Loss Reserve Account are subject to the same restrictions as provided in section (3) above.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0701 Loan Eligibility

(1) A lender may apply to the Department to enroll a Qualified Loan in the Program. The Department, at its sole discretion will determine whether a Loan is eligible and meets all the requirements for enrollment.

(2) A Qualified Loan does not mean a loan:

(a) With a variable interest rate;

(b) With an origination fee that exceeds 1.5%, and with an annual interest rate that exceeds the lesser of 18% or the Prime Rate plus 7%;

(d) With an annual interest rate that exceeds the lesser of 18% or the Bank Short-Term Rate plus 7%;

(e) That results in more than $250,000 being enrolled into the Program for any Business, or any affiliates or subsidiaries of a Business;

(f) For working capital with a term exceeding seven years;

(g) For working capital with an amortization exceeding seven years;

(h) For capital assets with a term exceeding the useful life of the assets;

(i) For capital assets with amortization exceeding the useful life of the assets;

(j) For the purchase of real property that is not used for the business operations of the Borrower;

(k) For the purchase of owner-occupied residential housing;

(l) For the construction, improvement or purchase of residential housing that is owned, or to be owned, by the Principal or their immediate family members.

(m) For the purchase of securities;

(n) For the purpose of lobbying activities;

(o) For the purpose of repayment of delinquent federal, state, county or other local government taxes; and,

(p) That includes, in whole or part:

(A) The refinancing of an existing loan made by the lender to the Borrower;

(B) The refinancing of an existing loan enrolled in another state or federal credit enhancement or credit insurance program;

(D) Reimbursement of funds owed to any owner, including funds to repay any equity injection or injection of capital for the business’ continuance;

(3) The Principals of a Qualified Loan may not be:

(a) An executive officer, director, or principal shareholder of the lender;

(b) A member of the immediate family of an executive officer, director or principal shareholder of the lender;

(d) Delinquent on federal, state or local taxes. A Business that has entered into, and is current on, a repayment agreement with the applicable taxing authority is not considered to be delinquent.

(4) The Business and the activities of the Business must be compliant with all federal, state or local laws.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-0801 Procedure for Enrollment of a Qualified Loan

(1) A lender may enroll a Qualified Loan in the Program by notifying the Department of the Qualified Loan to be enrolled, in a form prescribed by the Department, no less than five (5) business days prior to the lender disbursing funds to the Borrower or the date the loan documents are to be fully executed and the lender is obligated to disburse proceeds, whichever occurs sooner.

(2) The Department, upon receipt of documentation satisfying section (1) of this rule may authorize the enrollment of the Qualified Loan in writing if the Department is satisfied that the loan:

(a) Is a Qualified Loan;

(b) The loan is with a Qualified Borrower or a Qualified Business; and

(3) The Department shall, to the extent possible, notify the lender of its enrollment decision within 5 business days from receipt of all documentation required by the Department. Failure of the Department to provide written approval of the Enrolled Loan does not constitute an approval of, or enrollment of, a loan into the Program.

(4) A lender may approve and fund a loan to a Borrower in advance of the Department’s enrollment of a Qualified Loan in the Program, but such approval and funding is made at the sole risk of the lender as the Department may or may not ultimately enroll the loan in the Program.

(5) Notwithstanding section (4), the Department shall not enroll a loan more than 15 days after a lender funds such loan.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1001 Procedure for Making Claim for Reimbursement of Loss & Prioritization of Recovered Proceeds

(1) A lender shall notify the Department within 30 days of a default on an Enrolled Loan.

(2) If the Borrower is unable to cure the default and the lender anticipates writing off all or a portion of the outstanding loan balance at the time of default, the lender must submit a liquidation plan for Department review and approval prior to the Borrower or the lender liquidating any assets unless otherwise authorized in writing by the Department. The liquidation plan for the defaulted Enrolled Loan shall be in a form prescribed by the Department which shall include, but may not be limited to:

(a) A copy of the lender’s credit approval memo and supporting documentation of the loan;

(b) Personal financial statement(s) for the Borrower’s Principal(s);

(d) A written explanation describing reason(s) the pledges or security is otherwise forfeit, worthless or undiscoverable; and,

(e) A written explanation describing the extent to which the lender has attempted to exercise its right to recover its Loss with each respective pledge or security.

(3) The lender shall execute the approved liquidation plan for an Enrolled Loan in default and liquidate the Borrower’s and the Principal’s assets as applicable and provided as collateral in the lender’s loan approval. As required by the Agreement, should a Borrower fail to cooperate in the liquidation of assets, the lender shall exhaust all other lawful remedies against the Borrower and its Principal(s) to recover and liquidate assets pledged as security, including but not limited to realization of claims on their personal or other financial guarantees or from other applicable sources.

(4) If a lender anticipates writing off all or part of an Enrolled Loan as a result of a Borrower’s default, after meeting the requirements of section (3) of this rule, the lender may make a Claim for all or part of the Loss incurred by the Enrolled Loan in default by submitting a Claim in a form prescribed by the Department for the Department’s review and approval.

(5) All proceeds recovered by the lender as part of liquidation process for a loan in default shall first be applied to the outstanding principal balance of the loan. After full repayment of the principal balance, the lender may apply recovered proceeds to interest, late fees and legal costs at the lender’s sole discretion.

(6) The Department shall review a Claim for a Loss on an Enrolled Loan submitted under section (4) to determine if the lender has met the requirements of the Agreement and these rules. The Department may reduce or deny a Claim, in whole or in part, at its sole discretion, if the Department determines in its review of the lender’s administration of the Enrolled Loan that the lender failed to take action, consistent with these rules, the Agreement, the approved liquidation plan, and prudent business lending practices, to:

(a) Appropriately secure personal or business assets during the maintenance period of the loan; or,

(b) Work with the Borrower to liquidate the assets pledged as security for the Enrolled Loan in a reasonable and orderly manner.

(7) Only upon the Department’s approval of a Claim, may the lender recover the outstanding principal balance of the loan from the lender’s Loan Loss Reserve Account or other amount as reduced by the Department in its approval of the Claim. Upon approval of a Claim, the Department shall prepare a written authorization for the financial institution maintaining the Loan Loss Reserve Account to disburse the approved Claim amount to the lender.

(8) Notwithstanding the requirements of Section above, upon request of a lender, the Department may waive the lender’s collection obligation to pursue its rights against the personal or other financial guarantees of the Principals(s) and exhaust all lawful remedies if the Agreement conditions have otherwise been met and the following conditions have been met to the satisfaction of the Department:

(a) The original amount of the Enrolled Loan was $25,000 or less; and

(b) The Borrower and all Principals of the Borrower, including but not limited to all individually and jointly held assets, had a personal net worth not greater than $75,000 at both the time of application and the time of default.

(9) A lender that does not comply with ORS 285B.791(2)(d), ORS 285B.791(3)(a), or section (3) and (8) of this rule with respect to the process and requirements of making a Claim against the Loan Loss Reserve Account, shall be considered to have breached the Agreement. The Department, at its sole discretion, may take assignment of the defaulted Enrolled Loan from the lender and pursue collection efforts for the benefit of the lender as provided in OAR 123-300-1301.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1101 Reimbursement of Claims from Loan Loss Reserve Account

(1) The Department shall approve a lender’s Claim to reimburse the lender for Loss on an Enrolled Loan in default pursuant to the process and requirements described in OAR 123-300-1001.

(2) The Department shall reject a Claim if the Department determines that the:

(a) Lender has not completed required liquidation of the Borrower’s assets, realization of claims against the personal or financial guarantees on the Enrolled Loan, or realization of other sources as applicable; or

(b) Representations and warranties provided by the lender at the time of enrollment of the Qualified Loan, in the liquidation plan, or at the time of a claim for reimbursement were false.

(3) The liability of the State of Oregon and the Department under the Agreement is limited to the amount of moneys awarded and credited to the lender’s Loan Loss Reserve Account. All moneys awarded and credited to the lender’s Loan Loss Reserve Account, including all interest earnings shall be available to pay approved Loss Claims.

(4) When there are insufficient funds in the Loan Loss Reserve Account to cover the total amount of an approved Loss Claim, the Department shall authorize payment of an amount equal to the balance of the Loan Loss Reserve Account. Such payment of the balance shall fully satisfy the Claim and the lender will have no further rights to receive any other amount with respect to the Claim.

(5) The Department shall review Loss Claims in the order it receives them. If a lender files two or more Loss Claims simultaneously and there are insufficient funds in the Loan Loss Reserve Account to pay them, then the lender may designate the order the Loss Claims are to be processed by the Department.

(6) Loan Loss Reserve Accounts without a balance shall be closed and the lender shall be required to continue reporting in compliance with its Agreement and OAR 123-300-1301.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1201 Recovery on Loan Subsequent to Payment of Claims

(1) If, subsequent to the Department’s approval of the payment of a Claim from the Loan Loss Reserve Account, the lender recovers from the Borrower, or its Principal(s), through liquidation of collateral or from any other source, amounts for which the lender was reimbursed from the Loan Loss Reserve Account, the lender shall provide written notice to the Department within 10 business days of the recovery and shall promptly repay into the lender’s Loan Loss Reserve Account the amount received up to the amount of the reimbursement.

(2) The lender must provide the Department documentation of the repayment and deposit into the Loan Loss Reserve Account within 30 days of the recovery.

(3) Failure of the lender to provide notice as required by section (1) above or to repay the Loan Loss Reserve Account as required by section (2) above shall be a breach of the Agreement.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1301 Assignment of Enrolled Loan to Department

(1) As provided in OAR 123-300-1001(9), the Department, at its sole discretion, may take assignment of a defaulted Enrolled Loan and pursue collection efforts.

(2) Lender shall assign the Enrolled Loan to the Department upon the Department’s request. The Department shall not approve a Claim and the lender shall not recover any amount from the Loan Loss Reserve Account for the Loss while the Department is engaged in such collection efforts.

(3) The Department may take assignment if the Department believes that it would be able to take effective and proper action to more completely realize a return on the remaining available collateral or other sources of security for the defaulted Enrolled Loan, compared to the lender, regardless of whether the lender has indicated its inability or unwillingness to take such action.

(4) In response an assignment request, the Lender shall promptly assign its rights to the Department, providing the Department with originals of all applicable documents, accompanied by enforceable assignments and conveyances to the Department.

(5) All recoveries of the Department will be applied in the following order, until all expenses and the corresponding Loss are satisfied, to:

(a) Department’s legal and administrative costs associated with the enforcement of remedies to recover Losses, including costs incurred in the liquidation of assets, costs incurred in realization of personal or other financial guarantees, or other costs incurred related to the defaulted Enrolled Loan;

(b) The lender’s Loss not to exceed the principal balance of the Enrolled Loan; then,

(c) The lender’s unpaid accrued interest, fees, legal expenses, costs incurred in the liquidation of assets, costs incurred in realization of personal or other financial guarantees, or other costs incurred by the lender related to the defaulted Enrolled Loan.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1401 Reporting

(1) No later than July 31 of each year, a lender shall, during the term of an Agreement, provide an annual report to, and in a form prescribed by the Department, for the period beginning July 1 of the immediate proceeding year and ending on June 30 of the current year.

(2) The annual report shall include, but is not limited to, the following information in a form or format prescribed by the Department:

(a) The annual and cumulative number and principal amount of all Enrolled Loans made by the lender.

(b) The current principal balance of each Qualified Loan enrolled in the Program.

(A) The amount of the project;

(B) The term and amortization of the loan;

(D) The source and amount of other capital in the project.

(d) The number of loans that were declined, the amounts of the declined loans and the primary reasons for the declines.

(e) The number and amount of non-performing Enrolled Loans.

(f) Any other information required in the reporting form by the Department.

(3) With respect to Qualified Borrowers or Qualified Businesses, the annual report shall include, but may not be limited to:

(a) The NAICS code of the operating entity.

(b) The primary city and county in which the operating entity conducts business.

(d) Annual income of the Business.

(e) Voluntarily reported demographic data as prescribed by the Department, including, but not limited to, whether a Qualified Business is owned by a woman, a minority individual, a veteran of any branch of the Armed Forces of the United States, the National Guard or other reserve component, a low-income person or a person operating the business in a rural area of this state.

(f) The Business Identification Number provided by the Oregon Employment Department and the corresponding:

(A) Number of individuals employed by the Qualified Borrower or the Qualified Business at the time of application; and,

(B) The number of fulltime jobs projected by the Qualified Borrower or Qualified Business to be created and/or retained as a result of the Enrolled Loan.

(g) The principal balance of each Enrolled Loan that was delinquent during the reporting period.

(h) The principal balance of each Enrolled Loan that is/was in default during the reporting period.

(i) The number and amount of Claims submitted.

(j) The number and amount of Claims approved by the Department.

(k) The amount of recoveries received subsequent to payment of a Claim from the Loan Loss Reserve Account.

(4) With respect to the lender, the annual report shall include, but may not be limited to:

(a) An annual financial report of the lender.

(b) A copy of the last fiscal year audit of the lender.

(d) A summary of all referrals made to other federal, state, regional or local capital and/or technical assistance providers.

(e) A summary of all projects co-funded with other federal, state, regional or local capital and/or technical assistance providers.

(f) A summary of business lending activity within Oregon not enrolled in the Program including aggregately reported demographic data voluntarily provided by the recipients.

(5) A final report is due to the Department the earlier of 45 days after the termination of the Agreement, the Agreement maturity date, the lender’s notice of withdrawal from the Program or July 31, 2033. The final report shall be submitted in a form acceptable to the Department and shall include, but may not be limited to:

(a) The total number and total dollar amount of Enrolled Loans;

(b) The average interest rate, term and amount of Enrolled Loans;

(d) The total number and total dollar amount of approved Claims;

(e) The aggregate performance of Enrolled Loans; and

(f) The aggregate demographic data for Enrolled Loans.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1501 Termination of Continued Loan Enrollment, Repayment of Balance, and Withdrawal from the Program

(1) Should a Loan Loss Reserve Account balance reach zero or be expected to reach zero with the payment of a Claim, the Agreement shall be terminated subject to a final report being provided to the Department which shall be due within 45 days of the earlier of the Loan Loss Reserve Account reaching zero or the termination date of the Agreement.

(2) At such time the Loan Loss Reserve Account reaches zero or the Agreement is terminated, the Loan Loss Reserve Account shall be closed and any outstanding fees or balance due shall be paid in full by the lender.

(3) The Department may terminate enrollment of new Qualified Loans under the Program for a lender or terminate the lender’s Agreement altogether upon a 30-day notice of termination to the lender or such earlier date if the Department determines:

(a) The lender has failed to prudently underwrite, document and/or collect on the Loan Loss Reserve Account portfolio consistent with the terms and conditions of these rules or the Agreement.

(b) The lender has not enrolled a Qualified Loan for 24 consecutive months;

(c) The Loan Loss Reserve Account or Enrolled Loan portfolio of the lender has been in whole or in part, sold, transferred, assigned or subrogated;

(d) The lender has become insolvent or has ceased lending operations in Oregon. This provision shall apply whether or not a new financial institution, lender, or loan servicer purchases some or all of the loans of the lender;

(e) The lender fails to provide the required reporting as provided by OAR 123-300-1401;

(f) The lender fails to perform in any material way under the Agreement, the Act or under these administrative rules; or

(g) The lender makes a material misrepresentation in the submission to the Department of any of the following: the proposal to the RFP, Enrolled Loan documentation, Claims documentation, or reports required by the Program.

(4) The balance of funds in a lender’s Loan Loss Reserve Account shall be repaid to the State for deposit in the General as directed by the Department if the Department terminates the lender’s Agreement after determining that the circumstances under (3) above were met.

(5) A lender may withdraw from the Program after giving written notice to the Department. After receipt of this notice, the Department shall calculate the amount the lender shall be required to repay to the department based on the amount of moneys awarded to the lender under the Program, the amount of moneys remaining in the Loan Loss Reserve Account, and the aggregate amount of approved Claims as of the date of the withdrawal notice.

(6) A lender that withdraws from the program before maturity of the Agreement or a lender whose Agreement is terminated under section (3) of this rule shall have no rights to any portion of the Loan Loss Reserve Account award or any remaining balance thereof. Upon withdrawal or such termination, the Loan Loss Reserve Account shall be closed and any outstanding fees or balance due shall be paid in full by the lender.

(7) Termination of an Agreement does not waive other remedies the Department may exercise under the Agreement in the event of a lender’s default, nor does Termination absolve a lender of any contractual obligations owed to a Borrower under an Enrolled Loan agreement with the lender.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1601 Disposition of Funds Withdrawn from Loan Loss Reserve Accounts

All funds returned to the Department from lenders, or not disbursed as Program Awards by the Department by June 30, 2023, will be remitted to the State General Fund.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1701 Inspection of Files and Record Retention

(1) Program lenders shall permit the Department and any party designated by the Department, including the Secretary of State at any reasonable time, to inspect and make copies of any accounts, books and records, including, without limitation, Program lender’s files relating to Enrolled Loans. The lender shall supply such materials and information as the Department may reasonably require in person or in an electronic format reasonably prescribed by the Department.

(2) Program lenders shall retain and keep accessible for a minimum of 5 years from repayment of an Enrolled Loan in full, or payment of a Claim against the Loan Loss Reserve Account, the following:

(a) All documentation provided by the Borrower when making its application;

(b) Materials created by the lender when underwriting the loan including, but not limited to, the credit approval memo, collateral examinations, appraisals, and credit analysis documentation;

(c) Enrolled Loan documentation including, but not limited to, loan agreements, personal and business guarantees, deeds of trust, UCC filings, subordination agreements, and other common commercial lending documentation;

(d) All documentation provided by the Borrower at or near the time of default prior to the liquidation of assets;

(e) The lender’s liquidation plan; and

(f) All documentation related to the liquidation of assets and realization from personal and business guarantees.

(g) All other documentation related to the Agreement.

(3) If there are unresolved issues or disputes at the end of the records retention period required by section (2) above, a lender shall retain the books, documents, papers and records until the issues are resolved.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 706.008 & ORS 285B.780 - ORS 285B.799
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Or. Admin. R. 123-300-1901 Release of Lender from Agreement and Use of Balance in Account

(1) A lender shall be released from any obligation under an Agreement and may use for any purpose the remaining balance in the lender’s Loan Loss Reserve Account, including accrued interest, if the lender has:

(a) Performed under the terms and conditions of an Agreement entered into with the Department for a period of 10 years;

(b) Attained during the 10-year period of the Agreement, a ratio of four-to-one (4 : 1) of total principal amount of Enrolled Loans made by the lender to the amount of moneys awarded to the lender under the Program; and,

(2) Upon receipt of the lender’s final report, required annual reports and request for release, the Department shall calculate the ratio of total principal amount of Enrolled Loans made by the lender to the amount of moneys awarded to the lender under the Program to determine if lender has met the requirement of (1)(b) of this section.

(3) Failure of the lender to meet the requirement in (1)(b) of this section, shall require the lender to return a portion of the balance of the lender’s Loan Loss Reserve Account to the Department in an amount necessary to achieve the leverage ratio requirement of the provision.

(4) Any balance due under section (3) shall be remitted to the Department in full prior to release of the lender’s obligations or termination of the Agreement.

(5) A release under this section does not absolve a lender of any contractual obligations owed to a Borrower under a loan agreement.

(6) Upon release of lender from an Agreement, the Loan Loss Reserve Account shall be closed and any outstanding fees or balance due shall be paid in full by the lender.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799
Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008
OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023

Division 400 OREGON CHIPS PROGRAM

Or. Admin. R. 123-400-0000 Purpose and Scope

(1) The 82nd Oregon Legislative Assembly, 2023 Regular Session, passed chapter 25, Oregon Laws 2023 (Enrolled Senate Bill 4) which established the Oregon CHIPS Fund (“Fund”) and a new program to support private investment in the semiconductor and advanced manufacturing industry through financial awards of grants and loans to businesses that are covered entities (“Oregon CHIPS”). The awards are intended to serve as covered incentives and thereby assist businesses for purposes of federal semiconductor financial assistance from the U.S. Department of Commerce, pursuant to the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act of 2022 (Pub. L. 117–167), Chapter 72A, Title 15, United States Code (U.S.C.). The Fund received legislative appropriations and the Department received expenditure authority for the appropriations from sections 8 and 8b, chapter 25, Oregon Laws 2023 and sections 245 to 247, chapter 114, Oregon Laws 2024. In addition to usage for Oregon CHIPS, pursuant to chapter 81, Oregon Laws 2024, money in the Fund may be transferred to the CHIPS Child Care Fund for the purposes of providing financial support and child care subsidies for construction workforce. Pursuant to Chapter 89, Oregon Laws 2024, moneys in the Fund may also be used for National Semiconductor Technology Center projects under the federal program established pursuant to 15 U.S.C. 4656(c).

(2) These administrative rules specify elements of the program developed by the Department pursuant to sections 1 to 6, chapter 25, Oregon Laws 2023 (Enrolled Senate Bill 4), in order for the state to make financial awards of grants and loans from the Fund. The permanent administrative rules for the program are effective November 29, 2023 and the amended permanent rules shall apply to all program applicants and awardee businesses.

(3) In administering this program, the Governor and the Department will emphasize investments that assist communities, businesses or industries in promoting the creation, expansion, and preservation of semiconductor and advanced manufacturing in Oregon, and that encourage diversification and preservation of regional economies.

History

Statutory/Other Authority: ORS 285A.075, OR Laws 2023 ch. 25 §§1–8 & OR Laws 2023 ch. 25 §8b
Statutes/Other Implemented: OR Laws 2023 ch. 25 §§1–8 & OR Laws 2023 ch. 25 §8b
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0010 Federal Terms

(1) For purposes of this division administrative rules, the following terms are defined based on the federal CHIPS for America Act with the applicable federal statute cited with each term:

(a) The term "covered entity" means a nonprofit entity, a private entity, a consortium of private entities, or a consortium of nonprofit, public, and private entities with a demonstrated ability to substantially finance, construct, expand, or modernize a facility. (15 U.S.C. 4651(2)).

(b) The term "covered incentive":

(A) means an incentive offered by a governmental entity to a covered entity for the purposes of constructing a facility within the jurisdiction of the governmental entity, or expanding or modernizing an existing facility within that jurisdiction; and

(B) a workforce-related incentive (including a grant agreement relating to workforce training or vocational education), any concession with respect to real property, funding for research and development with respect to semiconductors, and any other incentive determined appropriate by the U.S. Secretary of Commerce, in consultation with the U.S. Secretary of State. (15 U.S.C. 4651(3)).

(c) The term “Facility” means a facility relating to fabrication, assembly, testing, advanced packaging, production, or research and development of semiconductors; facility relating to materials used to manufacture semiconductors; or facility relating to semiconductor manufacturing equipment. (15 U.S.C. 4651(2)).

(2) Both existing state incentives and programs and new incentives and programs from Oregon CHIPS Act are intended to qualify as covered incentives for the purposes of the federal CHIPS for America Act. Additional incentives and programs are pending with 82nd Oregon Legislative Assembly. The following are intended to qualify as covered incentives for purposes of the federal CHIPS for America Act:

(a) State financial awards of grants and loans to covered entities, pursuant to sections 1 to 6, chapter 25, Oregon Laws 2023 and as further defined by this division of rules;

(b) Lands designated by an executive order and brought within an existing urban growth boundary for the purposes of making designated lands available for industrial use as a site for facility by one or more covered entities pursuant to section 10, chapter 25, Oregon Laws 2023 are intended to serve as concessions with respect to real property, and therefore qualify;

(c) Enterprise zone (standard, long-term rural, tribal, and electronic commerce enterprise zone) property tax abatements provided to covered entities; and

(d) Strategic Investment Program (SIP) property tax exemptions to covered entities.

(e) Semiconductor Industrial Lands Loans Program awards.

History

Statutory/Other Authority: ORS 285A.075, OR Laws 2023 Ch. 25 §1 & OR Laws 2023 Ch. 25 §10
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §1 & OR Laws 2023 Ch. 25 §10
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0020 Definitions

For the purposes of this division of administrative rules, in addition to definitions found in OAR Chapter 123, Division 1 (Procedural Rules) and OAR 123-400-0010, the following terms have the meanings set forth below:

(1) “Agreement” means a program grant or loan contract between the Department and a business for an approved application that provides for the award amount from the fund and the terms of the contract. The term agreement does not include a contract for an application assistance grant.

(2) “Application” means the Department-prescribed form which includes contents including but not limited to those prescribed by section 2(1), chapter 25, Oregon Laws 2023, that an applicant must submit to propose a project and to request a program grant or loan, and also includes the supplemental attachments and exhibits that the applicant completes or furnishes to the Department.

(3) “Application assistance grant” means a grant to a business pursuant to section 1(4)(g), chapter 25, Oregon Laws 2023, and as described in OAR 123-400-0050, to defray costs of preparing an application to the U.S. Government for federal semiconductor financial assistance.

(4) “Average median income” as used in section 1(4)(f)(B), chapter 25, Oregon Laws 2023, means an average of the median household income, from the most recently available 5-year American Community Survey of the U.S. Census Bureau, for all counties constituting the Department’s regional service area in which the project is located, as described at https://www.oregon.gov/biz/, and weighted respective to the corresponding number of households in each county.

(5) “Business” means a person operating or conducting one or more trades or businesses as a private entity or consortium of such entities, whether for profit or not, that is a covered entity, notwithstanding other types of covered entities that would not be a business.

(6) “Fund” means the Oregon CHIPS Fund established under section 6, chapter 25, Oregon Laws 2023.

(7) “Grant and loan proceeds” means all payments or disbursements made to the business from the Fund, less the amount of any repayment, deduction or fee, and not including any application assistance grant.

(8) “Permanent, full-time positions” as used in section 1(4)(f)(A), chapter 25, Oregon Laws 2023, means jobs, in which the employee is hired to work year-round and is paid for more than 32 hours of the workweek on average during the course of a year, and excludes any job that is temporary, seasonal, part-time (except for job-share), or only for constructing or installing property.

(9) “Project” means the investments and operations of a business that will or have used program grant and loan proceeds from the Fund according to an agreement

(10) “State and local revenue” as used in section 1(4)(e), chapter 25, Oregon Laws 2023, means public revenue from taxes, fees or other sources, whether paid by the business or not, that:

(a) Arise from direct or indirect economic and fiscal impacts of the investment and operations of a project; and

(b) Can be accounted for with records or estimated by the Department’s modeling as accumulating to the government of this state or of any local jurisdiction containing the project during the period in which the agreement is in effect.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 Ch. 25 §§1–6
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §§1–6
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0030 Application Review and Approval

(1) In coordination and consultation with the Governor, the Department shall review all timely and complete applications for program grants and loans. The review shall include:

(a) Review of proposed projects for determination of compliance with eligible uses of program grant and loan proceeds as provided by section 1(3)(a), chapter 25, Oregon Laws 2023, and as further defined by this division of rules;

(b) Review for completion of the application, including satisfaction of requirements provided under section 2(1)(b), chapter 25, Oregon Laws 2023;

(d) Applying other criteria set forth with the Request for Applications.

(2) When the Governor intends to approve program grant or loan amounts that exceed $50 million in total for a single business, the Governor with the Department’s assistance, shall provide formal notice of the amount of the program grant or loan the Governor intends to approve to the Speaker of the Oregon House of Representatives, State Senate President, and the co-chairs of committees involved in the passage of Senate Bill 4 (2023).

(3) Within 90 days of receiving an application (but not less than 30 days after any notice in section (2) of this rule), the Department in consultation with the Governor shall approve or reject:

(a) The requested program grant or loan in the application; and

(b) Any accompanying request for an application assistance grant.

(A) Successful applicants will receive a notice of intent to award, and unsuccessful applicants will receive a letter of explanation.

(B) The notice of intent to award letter provided for approved applications shall contain an offer of an amount for the program grant or loan, an amount for an application assistance grant or both, including but not limited to an offer that is less than what was requested by the business applicant.

(4) Any Business approved for a program grant or loan shall provide the Department evidence of federal CHIPS for America Act application acceptance by the U.S. government.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 Ch. 25 §§1-3
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §§1-3
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0040 Project Requirements

(1) To be approved and funded, an application must propose a project that includes permitted program grant and loan uses of Funds as provided by Section 1(3)(a), chapter 25, Oregon Laws 2023. That is, a proposed project must request program grant or loan proceeds to be used solely for:

(a) Research and development with respect to semiconductors or advanced manufacturing; or

(b) Partnering with institutions of higher education, local workforce boards, groups and other programs, consistent with examples under section 1(3)(a)(B)(iii), chapter 25, Oregon Laws 2023, for the purpose of workforce development and the creation of training, registered apprenticeship and internship opportunities, with respect to semiconductors or advanced manufacturing; or

(c) Development of a site for a facility or development of site for other advanced manufacturing, which may include but is not limited to:

(A) Acquisition and aggregation of land of a site, whether improved or not;

(B) Expansion, improvement, construction, modernization, demolition or redevelopment of buildings, structures or utilities;

(D) Training or other workforce development specific to facility operations or operations of an advanced manufacturing site, which may also include subsection (b) of this section.

(2) While other advanced manufacturing projects are eligible as provided in section (1) above, the Department and the Governor will give preference to projects directly related to the federal semiconductor financial assistance program.

(3) Proposed projects in an application to be funded by program grant or loan proceeds must provide for new investments, rather than existing investments or property. Determinations of whether a proposed project is a new investment or is an ineligible existing project will be determined by the Department, in its sole discretion. In addition, grant or loan proceeds may not be used for costs incurred prior to April 13, 2023.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25 §§3
Statutes/Other Implemented: OR Laws 2023 ch. 25 §§3
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0050 Application Assistance Grants

(1) As part of an application that requests a program grant or loan for a proposed project, a business may request an application assistance grant in an amount not to exceed $50,000.

(2) The Department may award and disburse an application assistance grant based principally on the business’s demonstration of need for assistance.

(3) The Department may award an application assistance grant only to a business that the Department has also approved an application for a program grant or loan.

(4) Notwithstanding section (3) of this rule, a contract specific to the application assistance grant may be executed prior to execution of an agreement for a program grant or loan.

(5) A business awarded an application assistance grant shall use the grant funds solely for the costs of preparing and submitting the business’s application for federal semiconductor financial assistance, and an application assistance grant contract shall require the business to complete and submit an application for federal semiconductor financial assistance.

(6) Repayment and penalties under section 5, chapter 25, Oregon Laws 2023, attach to any application assistance grant.

(7) Comparable funding, as may be provided to covered entities seeking federal semiconductor financial assistance, through a separate program of the Governor or the Department, is not subject to this administrative rule or to sections 1 to 6, chapter 25, Oregon Laws 2023.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 Ch. 25 §§1, 2, 3 & 5
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §§1, 2, 3 & 5
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0060 Agreements

(1) After approval of an application for a program grant or loan for a Project, the Department in coordination with the Governor shall promptly:

(a) Provide official documentation of the program grant or loan for the business to present as evidence of a covered incentive, which may include a notice of intent to award letter, conditional award letter or a binding commitment letter; and

(b) Begin preparation of an agreement with the business.

(2) Agreements for program loans:

(a) May be made for a term not to exceed 10 years, not including any necessary closeout period to conduct agreement verifications. Recipient businesses shall use loan proceeds only for costs incurred during the term of the agreement, and recipient businesses shall complete revenue /jobs generation obligations during the term of the agreement;

(b) Shall be made at a zero rate of interest, unless a penalty is imposed under Section 5(3), chapter 25, Oregon Laws 2023;

(c) Shall require that for every $1 million in program loan proceeds received, the recipient business must, over the period of the loan agreement, generate at least:

(A) If the term of the agreement is not more than five years, $1.25 million in state and local revenue; or

(B) If the term of the agreement is more than five years, $1.5 million in state and local revenue.

(d) In lieu of the requirement under section (2)(c) of this rule, shall require that a recipient business instead commit to the creation of new jobs in Oregon:

(A) For every $45,000 in program loan proceeds received, the recipient business must commit to generate at least one new job;

(B) At least 65 percent of the required new jobs must be permanent, full-time positions (to constitute permanent positions, such jobs must be retained by the recipient business for the requisite term of years provided for in the loan agreement), starting no sooner than April 13, 2023; and

(C) That pay on average at least the average median income for the region of this state in which the services will be performed.

(e) Shall provide terms for loan proceeds disbursements, which may be in a single payment or in multiple, conditional payments.

(f) Shall provide terms for loan repayment.

(g) Shall contain terms imposing liability for immediate repayment, including but not limited to those provided in Section 5, chapter 25, Oregon Laws 2023.

(h) Shall provide prevailing rate of wage requirements.

(i) Shall contain such other terms and conditions as the Department requires.

(3) Agreements for program grants:

(a) May be made for a term not to exceed 10 years not including any necessary closeout period to conduct agreement verifications. Recipient businesses shall use grant proceeds only for costs incurred during the term of the agreement, and recipient businesses shall complete revenue /jobs generation obligations during the term of the agreement.

(b) Shall provide terms for repayment of the grant if the obligations in sections (3)(c) or (3)(d) of this rule, as applicable, are not met during the period of the grant agreement. Repayment terms may include full repayment and partial repayment obligations, including repayment obligations that are prorated. If a repayment is required at the termination of the agreement, no interest shall be imposed on the grant proceeds; however, a penalty may be imposed under Section 5(3), chapter 25, Oregon Laws 2023.

(c) Shall require that for every $1 million in program grant proceeds received, the recipient business must, over the period of the grant agreement, generate at least:

(A) If the term of the agreement is not more than five years, $1.25 million in state and local revenue; or

(B) If the term of the agreement is more than five years, $1.5 million in state and local revenue.

(d) In lieu of the requirement under paragraph (3)(c), shall require that a recipient business instead commit to the creation of new jobs in Oregon:

(A) For every $45,000 in program grant proceeds received, the recipient business must commit to generate at least one new job;

(B) At least 65 percent of the required new jobs must be permanent, full-time positions (to constitute permanent positions, such jobs must be retained by the recipient business for the requisite term of years provided for in the grant agreement), starting no sooner than April 13, 2023; and

(C) That pay on average at least the average median income for the region of this state in which the services will be performed.

(e) Shall provide terms for grant proceeds disbursements, which may be in a single payment or in multiple, conditional payments.

(f) Shall contain terms imposing liability for immediate repayment, including but not limited to those provided in Section 5, chapter 25, Oregon Laws 2023.

(g) Shall provide prevailing rate of wage requirements.

(h) Shall contain such other terms and conditions as the Department requires.

(4) If a Business changes ownership or substantially reorganizes while its agreement is in effect:

(a) The Department in consultation with the Governor may execute an amended and restated agreement or a new agreement with the business pursuant to section 3(4), chapter 25, Oregon Laws 2023 that commits the business to continue the approved project.

(b) The business remains liable for the terms of the original agreement, including remaining subject to section 5, chapter 25, Oregon Laws 2023 if an amended and restated or new agreement is not executed.

(c) In the amended and restated or new agreement, the department may agree to minor changes in the terms of the original agreement that the department and the Governor considers reasonable in the circumstances and faithful to the purpose for which the business’s application was approved.

(5) Program grant or loan proceeds from the Fund may be used to pay only project costs in accordance with section 1(3)(a), chapter 25, Oregon Laws 2022, and as authorized by the Department at its sole discretion under the terms of a loan or grant agreement. The Department may require a project budget of authorized costs be incorporated into the agreement.

(6) Notwithstanding the definition of state and local revenue, the Department and the recipient business may specify in the agreement for a program loan or grant what the term state and local revenue includes. The Department, in its sole discretion, may impose restrictions in an agreement that specify or limit the state and local revenue generated that will be included in the calculation of the state and local revenue generated.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 Ch. 25 §3
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §3
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0070 Reporting Economic and Fiscal Information

(1) Following the date on which a business enters into an agreement with the Department, the business must submit a report to the Department on the status of its Project as provided by section 4(1), chapter 25, Oregon Laws 2023, no later than May 15 and November 15 each year. These reports shall cover the immediately preceding six-month period (January 1 – June 30 and July 1 – December 31).

(2) The reporting obligations provided in section (1) cease on the earlier of the date the agreement expires, the date the agreement is terminated, or the date the department has determined that the business has met their contractual obligations, if applicable, for generating state and local revenue as provided by section 1(e)(A) and specified in the program grant or loan agreement.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25 §§4
Statutes/Other Implemented: OR Laws 2023 ch. 25 §§4
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0080 Verification of Obligations

(1) A business shall submit a report and documentation to the department each year by November 15, verifying, as applicable to their agreement, their project’s annual:

(a) State and local revenue generated in accordance with section 1(4)(e), chapter 25, Oregon Laws 2023, setting forth the kinds, amounts and timing of the revenue generated; or

(b) New jobs created in accordance with section 1(4)(f), chapter 25, Oregon Laws 2023.

(2) If applicable, based on the negotiated agreement, a company may report both state and local revenue generated as provided in (1)(a) of this section and new jobs created as provided in (1)(b) of this section. The obligation will be considered satisfied with whichever metric (revenue or jobs) is met first.

(3) Only state and local revenue generated, or new jobs created that can be verified by the department will count towards meeting the business’s applicable agreement obligations. A business at its discretion may omit revenues or jobs from the calculation.

(4) Businesses obligated to generate state and local revenue in accordance with section 1(4)(e), chapter 25, Oregon Laws 2023 and the agreement shall:

(a) Provide payroll data for the project for purposes of estimating personal income taxes if a business desires to include personal income taxes generated by their project in the calculation of the state and local revenue generated.

(b) Provide tax returns, invoices, statements, and the like as applicable to document the state and local revenue generated if a business desires to include payroll taxes, corporate activity taxes, system development charges, property taxes, community service fees, or other taxes, fees or payments to state and local governments in the calculation of the state and local revenue generated.

(c) Provide applicable and sufficient documentation to allow the department to verify the state and local revenue generated if a business seeks to utilize taxes, fees, or other payments collected by the state or a local government from other businesses that are vendors, suppliers or contractors to the project to meet their agreement obligations.

(d) Provide sufficient documentation to allow the department to verify the expenditures made on project, for those costs the business seeks to utilize in the calculation for meeting their agreement obligation.

(e) Comply with any limitations, exclusions, or requirements included in the agreement.

(5) The agreement may provide for adjustment in specified types of state and local revenues that are included to meet the obligations described in (1)(a) of this rule, depending on the quality of data that is otherwise available relative to verification expectations, including but not limited to information the business effectively does provide or report.

(6) Businesses obligated to create new jobs in accordance with section 1(4)(f), chapter 25, Oregon Laws 2023 and the agreement shall:

(a) Provide documentation of the business’ jobs and payroll to be included in the calculation for each quarter during the term of the agreement for the project. The documentation must be consistent with quarterly payroll data submitted to the Oregon Employment Department.

(b) Provide documentation regarding the number of existing jobs and of new hirings for permanent, full-time positions each quarter, associated with the project to be included in the calculation to meet the business’s obligations. Documentation shall include annual average wages, job descriptions, weekly hours, pay scale and locations of the job. Only in-state jobs may be utilized to meet the new jobs created obligations.

(c) Provide documentation for other jobs associated with the project, including those in research and development, those partnering with institutions of higher education, and other jobs that are permanent, full-time positions that are associated with the project but are not jobs within the business, that are to be included in the calculation to meet the business’s obligations.

(7) Businesses are required to cooperate with the Department, providing the Department with authorizations and access to applicable state and local government records to conduct verification activities for obligations described in section (1) of this rule, including but not limited to those records held by the Oregon Department of Revenue and the Oregon Employment Department.

(8) A business shall submit a report and documentation to the department at least each year by November 15, verifying, as applicable to their agreement, their use of the program grant or loan proceeds for the project. Such an expenditure report shall detail project costs in accordance with section 1 (3)(a), chapter 25, Oregon Laws 2022, and as authorized by the Department under the terms of the agreement. The expenditure report shall:

(a) Detail all capital expenses associated with the project paid for with program grant or loan proceeds, and include the submission of documentation, including itemized receipts for purchases and contractor billings as required by the department. This may include costs of new construction, tenant improvements, equipment, tools, and machinery, and other facility improvements, modifications, installations or enhancements; and

(b) Details other soft costs (design, engineering, legal fees, etc.) of the project paid for with program grant or loan proceeds.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 Ch. 25 §4
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §4
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0090 Revenue and Employment Requirements

(1) The agreement shall specify whether fulfilment of program requirements to avoid repayment of program grant or loan proceeds will be primarily determined by satisfaction of section 1(4)(e) or 1(4)(f), chapter 25, Oregon Laws 2023, namely:

(a) by fulfilling the required return on investment (“ROI”) in terms of state and local revenue associated with the project and respective to the amount of program grant or loan proceeds received by the business; or

(b) by fulfilling the creation of qualifying new jobs in Oregon associated with the project.

(2) The agreement may allow for amendment and subsequent reassignment of the selection of paragraph (1)(a) or (b) of this rule under limited circumstances.

(3) For the ROI measure provided in paragraph (1)(a) of this rule, a business must meet the obligations as provided in the agreement, which shall equal or exceed the obligations of section 1(4)(e), chapter 25, Oregon Laws 2023.

(4) For the job creation measure provide in paragraph (1)(b) of this rule, a business must meet the obligations in the agreement, which shall equal or exceed the obligations of section 1(4)(f), chapter 25, Oregon Laws 2023.

(5) Notwithstanding section (1) above, the agreement may provide that the business’ ROI obligation may be satisfied by either section 1(4)(e) or 1(4)(f), chapter 25, Oregon Laws 2023, i.e. whichever obligation is satisfied first (state and local revenue or job creation).

History

Statutory/Other Authority: ORS 285A.075, OR Laws 2023 ch. 25 §§1-2 & OR Laws 2023 ch. 25 §5
Statutes/Other Implemented: OR Laws 2023 ch. 25 §§1-2 & OR Laws 2023 ch. 25 §5
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0100 Oregon CHIPS Fund

In addition to the disbursement of program grants and loan proceeds or other purposes allowable under sections 1 to 6, chapter 25, Oregon Laws 2023, moneys from the Fund may be used, as determined by the Governor or the Department, to pay for:

(1) Administrative costs including but not limited to:

(a) Issuing application materials, as well as education about the process;

(b) Processing and reviewing applications;

(d) Implementing reporting and compliance procedures, including but not limited to accounting for and estimating State and Local Revenue;

(e) Managing grant or loan awards from initiation to closing;

(f) Conducting enforcement activities for Program noncompliance, including repayment collection activities; and

(g) Procuring consulting, legal or other services for conducting the activities described in this section.

(2) Administrative and other costs of the Governor in carrying out section 10, chapter 25, Oregon Laws 2023.

(3) Paying the actual costs incurred by the Department to develop, administer, and carry out sections 1 to 4, chapter 81, Oregon Laws 2024, including administering the CHIPS Child Care Fund and a program to provide financial support and childcare subsidies.

(4) Financial assistance for National Semiconductor Technology Center (“NSTC”) projects established pursuant to the federal program provided by 15 U.S.C. 4656(c). Financial assistance for NSTC projects are exempt from the return on investment requirements (state and local revenue or job creation) described in these administrative rules.

History

Statutory/Other Authority: ORS 285A.075, OR Laws 2023 Ch. 25 §1, OR Laws 2023 Ch. 25 §6, OR Laws 2023 Ch. 25 §8 & OR Laws 2023 Ch. 25 §8b
Statutes/Other Implemented: OR Laws 2023 Ch. 25 §1, OR Laws 2023 Ch. 25 §6, OR Laws 2023 Ch. 25 §8 & OR Laws 2023 Ch. 25 §8b
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Or. Admin. R. 123-400-0110 Records and Data Confidentiality

(1) Data or information regarding a Business or Project in Agreements, applications, semiannual reports, or related materials or communications provided to the Department or Governor will be public records subject to disclosure, except for information that qualifies as a public records exemption under ORS 192.311 to 192.478 (Oregon Public Records Law).

(3) When providing items referenced in subsection (1) of this rule, it is the Business’s, its agent’ or its representatives’ responsibility to mark data and information that legitimately and specifically qualify for an exemption from disclosure. To designate an item or portion of one as exempt from disclosure, the Business shall clearly identify with words such as “CONFIDENTIAL – DO NOT DISCLOSE” or other words to the same effect in the body of the Agreement, application, report and other materials only the limited data or information exempt, including but not limited to before and after January 1, 2027, for trade secrets under ORS 646.461(4) and section 2(3), chapter 25, Oregon Laws 2023;

(4) Notwithstanding section (3) of this rule, a Business’s failure to mark a submission or portion of a submission, shall not be conclusive evidence as to whether a submission was submitted in confidence or is subject to disclosure.

(5) The Department shall determine whether a submission, data or any information is actually exempt from disclosure and will redact from disclosure only that data or information.

(6) Businesses are advised to consult with legal counsel regarding disclosure issues. Businesses may wish to limit the amount of truly trade secret or other data or information provided only to what is necessary.

(7) If the Department is subject to a disclosure order or receives from a third party any public records requests for the disclosure of submissions or portions of a submission, the Department shall notify the Business of the request or disclosure order. The Department will not disclose submissions or portions of a submission for 10 days after the notice. The Department will make reasonable efforts to provide the Business the proposed response.

History

Statutory/Other Authority: ORS 285A.075 & OR Laws 2023 ch. 25 §§1–6
Statutes/Other Implemented: OR Laws 2023 ch. 25 §§1–6
OBDD 1-2025, amend filed 01/16/2025, effective 01/16/2025
OBDD 11-2024, temporary amend filed 05/30/2024, effective 05/30/2024 through 11/25/2024
OBDD 32-2023, adopt filed 11/27/2023, effective 11/29/2023

Division 401 RESEARCH AND DEVELOPMENT TAX CREDIT FOR SEMICONDCUTORS

Or. Admin. R. 123-401-0100 Purpose and Scope

(1) The 2023 Oregon Legislature passed chapter 298, Oregon Laws 2023 (Enrolled House Bill 2009), which establishes the Research and Development Tax Credit for Semiconductors. This is a new program to both recognize and further the important contributions of this industry to regional and national economies.

(2) These administrative rules specify elements of and provide guidance for the program developed by the Oregon Business Development Department pursuant to ORS 315.518 to 315.522 and sections 1, 5 to 8, and 12, chapter 289, Oregon Laws 2023 to administer the Research and Development Tax Credit for Semiconductors. To be eligible to claim this tax credit for tax year 2024, taxpayers had to submit a one-time registration form by December 1, 2023, and then apply for and obtain certification from the department. The same certification process is required annually for taxpayers seeking to claim the tax credit for subsequent tax years, but registration is not required.

(3) In administering this program and the certification process, the department will communicate and coordinate across state government as required or permitted by law, including sharing of information with the Oregon Department of Revenue.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 through 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Or. Admin. R. 123-401-0200 Definitions

For the purposes of this division of administrative rules, in addition to definitions found in ORS 315.518 to 315.522, the following terms have the meanings set forth below:

(1) “Act” means Oregon Laws 2023, chapter 298, sections 1 through 12 (Enrolled House Bill 2009)

(2) “Application” means the form prescribed by the Oregon Business Development Department that a qualified semiconductor company must submit to the department to request certification.

(3) “Authorized representative” means a Company’s Chief Executive Officer, Chief Financial Officer, Controller, or another senior level financial officer of a company.

(4) “Certification” means the written determination of eligibility by the department necessary for the taxpayer to claim the Research and Development Tax Credit for Semiconductors.

(5) “Qualified semiconductor company” has the meaning given to that term in ORS 315.518(1).

(6) “Research and Development Tax Credit for Semiconductors” means the tax credit allowed under ORS 315.518 to 315.522 and applicable administrative rules.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 - 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Or. Admin. R. 123-401-0300 Taxpayer Eligibility

To be eligible for certification required to claim the Research and Development Tax Credit for Semiconductors, a taxpayer must meet all of the following requirements as well as any additional requirements specified in statute or applicable administrative rules:

(1) Be a qualified semiconductor company;

(2) Incur qualified research expenses or basic research payments in Oregon, in the tax year for which the certification is being requested; and

(3) Be subject to personal income taxes under ORS chapter 316 or corporate excise taxes under ORS chapter 317.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 - 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Or. Admin. R. 123-401-0400 Certification Process

(1) For the 2024 tax year, a taxpayer that submitted a valid registration form to the Oregon Business Development Department by December 1, 2023, and seeks to claim a Research and Development Tax Credit for Semiconductors for tax year 2024 must file a written application for certification with the department no later than October 15, 2024. For tax years 2025 through 2029, a taxpayer that seeks to claim the credit must file a written application for certification with the department no later than October 15 each calendar year for the tax year that begins or is deemed to begin in that calendar year. If the deadline falls on a Saturday or a legal holiday (per ORS 187.010), the deadline is the next business day.

(2) All eligible taxpayers, whether they file based on a calendar year, fiscal year or otherwise, must submit their application for certification to Business Oregon by the specified deadline each calendar year. An eligible taxpayer with a 52-53-week tax year that has two tax years beginning in the same calendar year should submit the application for the later tax year by the deadline in the following calendar year. (Example: An eligible taxpayer with a 52-53-week tax year has taxable years beginning Jan 1, 2025, and Dec 31, 2025. The certification application for the tax year beginning Dec 31, 2025, should be submitted by the 2026 calendar year deadline).

(3) The department provides a certification application form to taxpayers via its website. Certification application materials that the applicant must submit include the application form, along with supporting documentation, and the applicable fee.

(4) To be complete, the certification application must include, but is not limited to, the following:

(a) A description of how the taxpayer meets the definition of a qualified semiconductor company, as defined in the Act;

(b) A description of how proposed research and development activities for which the taxpayer seeks a tax credit under the Act will support the taxpayer in conducting a business or trade directly related to semiconductors;

(c) An attestation that the proposed research and development activities for which the taxpayer seeks the credit will support the taxpayer in conducting trade or business directly related to semiconductors;

(d) An attestation of the taxpayer’s expected qualified research expenses and basic research payments in Oregon, each as documented in the taxpayer’s documented internal financial projections, for the tax year;

(e) A report of the taxpayer’s qualified research expenses and basic research payments from the three (3) preceding tax years;

(f) The amount of the potential tax credit for which the taxpayer is seeking certification;

(g) Payment of the fee required under OAR 123-401-0500; and

(h) Any other information required by the department.

(5) Certification application forms must be signed by the taxpayer or an authorized representative of the taxpayer.

(6) As part of its review of submitted materials, the department may require the taxpayer or the taxpayer’s authorized representative to provide additional information.

(7) The department shall review all completed certification applications and determine the taxpayer’s eligibility for certification for the Research and Development Tax Credit for Semiconductors.

(8) The department shall issue certifications to eligible taxpayers on or before November 15th of the calendar year in which the certification application is submitted.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 - 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Or. Admin. R. 123-401-0500 Certification Fee

(1) The Oregon Business Development Department is authorized to establish a fee for filing a written application for certification under ORS 315.522(4) adequate to recover the costs incurred by the department in reviewing the applications.

(2) The fee for companies applying for certification is $3,000.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 - 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Or. Admin. R. 123-401-0600 Calculation of Tax Credit Certified Amount

(1) Pursuant to the Act, the Oregon Business Development Department may not certify a total amount of potential tax credits for all qualified semiconductor companies in excess of the limits in Oregon Laws 2023, chapter 298, section 8.

(2) In order to ensure availability of the Research and Development Tax Credit for Semiconductors for qualified semiconductor companies seeking Certification, the Oregon Business Development Department establishes annual caps for each tax year as follows:

(a) $35 million for tax year 2024;

(b) $38.25 million for tax year 2025;

(d) $44 million for tax year 2027;

(e) $46 million for tax year 2028;

(f) $50 million for tax year 2029.

(3) If the total amount of certified tax credits is less than the annual cap for a particular tax year in the first year of a biennium, the amount of the difference will be added to the cap amount for the second tax year of that same biennium. The maximum amount of credit that may be certified or claimed by any taxpayer is $4,000,000 for the tax year.

(4) If the total amount of potential tax credits sought across all applications exceeds the total annual credit cap for a particular tax year, the department will reduce the certified credit amounts that exceed $200,000 by a ratio necessary to keep the total certified amounts within the limits.

(5) Taxpayers may not claim a tax credit in excess of their certified credit amount.

(6) Certification of eligibility for a particular amount of tax credit by the department does not necessarily entitle a taxpayer to claim that amount of credit. The actual amount of credit a taxpayer is eligible to claim depends on the actual qualified research expenses and basic research payments incurred by the taxpayer in Oregon during the tax year, but in no event may the taxpayer claim more credit than the amount certified by the department.

(7) All tax credits claimed remain subject to audit by the Oregon Department of Revenue, as allowed by law.

(8) The Oregon Business Development Department may order the suspension or revocation of a credit as allowed under ORS 315.061.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 315.518 - 315.522 & Oregon Laws 2023, chapter 298, section 5
OBDD 10-2025, temporary amend filed 12/10/2025, effective 12/10/2025 through 06/05/2026
OBDD 16-2024, adopt filed 07/01/2024, effective 07/01/2024

Division 450 OREGON ARTS PROGRAM GRANTS

Or. Admin. R. 123-450-0000 Definitions

(1) “Commission” means the Oregon Arts Commission.

(2) “Executive Director” means the administrator of the Arts Program of the Oregon Business Development Department.

History

Statutory/Other Authority: ORS 359
Statutes/Other Implemented: ORS 359
OBDD 2-2011, f. & cert. ef. 1-3-11

Or. Admin. R. 123-450-0010 Grants

(1) Receipt of Funds. The Commission may receive from state, federal, or local governments or from the community at large, funds for use by the Commission for its own programs or disbursements deemed worthy by the Commission within the restrictions provided by law.

(2) Purposes and Goals. With funds available to the Commission for such purposes, the Commission may from time to time, on application, approve and disburse grants to encourage and support artistic endeavor in all disciplines and to insure as feasible that the cultural resources of the state are made available to all. In the grant process, the Commission should consider the following goals:

(a) To support and promote excellence in the arts in Oregon;

(b) To make artistic activities of high quality available to all;

(c) To disseminate information about arts and cultural activities in the state, and about resources for the arts that are available, both regionally and nationally;

(d) To assist Oregon artists who contribute to its economic and cultural development;

(e) To encourage and aid the development of regional and local councils and organizations that promote cultural development and provide arts related services to the community.

(3) Eligibility. Grants to organizations shall be made only to those groups or organizations which are nonprofit and tax exempt pursuant to the then existing laws, with the exception of organization types granted a waiver, including regional differences, in accordance with stated Commission guidelines. Nonprofit organizations that do not meet eligibility and provide ongoing arts programming and services in regions without arts organizations may apply for an exception waiver. Grants may be made to individual Oregon artists through certain programs, as determined by the Commission; Grants may be matched by a grantee recipient at the discretion of the Commission.

(4) Reporting. The applicant must submit financial information satisfactory to the Commission at the time of application and prior to action by the Commission. In the event a grant is made, the grantee must comply with the budget outlines submitted with the application and make records available from time to time for periodic audit by the Commission.

(5) Action on Grants. All applications submitted to the Commission must be acted upon by the Commission in public meetings; provided, however, the Commission may delegate to the Executive Director authority to authorize grants minimal in nature, subject to ratification by the Commission.

(6) Guidelines. With the approval of the Commission, guidelines shall be written and published that provides the public and applicants with information regarding the grants process and procedures. Appropriate forms and materials designed in accordance with such guidelines shall be made available.

History

Statutory/Other Authority: ORS 359
Statutes/Other Implemented: ORS 359
OBDD 3-2019, amend filed 02/04/2019, effective 02/04/2019
Renumbered from 190-010-0035, OBDD 2-2011, f. & cert. ef. 1-3-11
AC 2, f. & ef. 6-2-77

Division 475 1% FOR ART IN PUBLIC BUILDINGS

Or. Admin. R. 123-475-0000 Purpose

The purpose of these rules is to:

(1) Establish procedures for acquisition of works of art in an amount of 1% of direct construction costs of any project for the construction or alteration of any State Building in an amount of $100,000 or more.

(2) Promote placement of visual art of the highest quality where it can be easily viewed by the general public.

(3) Utilize the talent of artists and craftspeople.

(4) Preserve, encourage, and promote public awareness and understanding of the arts.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
Renumbered from 190-020-0000, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0005 Definitions

The words and phrases used in these rules have the same meaning given them in ORS 276.073. In addition, as used in these rules, unless the context requires otherwise:

(1) "Architect" means the person or firm (architect, landscape architect, interior designer, or other design professional) designing the project to which the 1% provision applies.

(2) "Artist" means a practitioner in the visual arts, generally recognized by critics and peers as a professional of serious intent, who produces Works of Art and who is not the Project Architect.

(3) “Capitol Area” means the area defined in ORS 276.028.

(4) "Contracting Agency" means the state agency authorized by law to enter into public contracts.

(4) “Deaccession” means removal of a work of art from the public collection as described in OAR 190-020-0080.

(5) “Designated Agencies” means the Oregon Arts Commission, Department of Administrative Services and, for project located outside of the Capitol Area, the Contracting Agency.

(6) “Program” means the 1% for art program described in ORS 276.073 to 276.090.

(7) “Project” means the construction or alteration of a State Building that costs $100,000 or more.

(8) "Resident Agency means the state agency or agencies that will occupy or otherwise use State Building. The Resident Agency may be the Contracting Agency.

(9) "State Building" means any structure built or remodeled by the State of Oregon using legislatively appropriated monies except those excluded in the definition of state building in ORS 276.073. “State Building” does not include a building leased by a state agency, unless under a lease-purchase agreement or under any other agreement whereby ultimate state ownership is contemplated or expected.

(10) "Works of Art" means all forms of original creations of visual art, including and not limited to:

(a) Painting: all media, including both portable and permanently-affixed works such as murals.

(b) Sculpture: in the round, bas-relief, high relief, mobile, fountain, kinetic, electronic, and site specific works placed on public lands in any material or combination of materials.

(c) Visual art comprising other two- and three- dimensional media including but not limited to prints, clay, drawings, stained glass, mosaics, photography, fiber and textiles, wood, metal, plastics and other materials or combination of materials, calligraphy, mixed media, film, video, or any combination of forms of media and documented time-based works or installations.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
Renumbered from 190-020-0005, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0010 Overview of Program

(1) The Oregon Arts Commission coordinates the Program. All Oregon State agencies, upon legislative approval of construction budgets, must notify the Oregon Arts Commission in writing of construction budgets or appropriations approved by the Legislative Assembly for any State Building. Upon written authorization by the Oregon Arts Commission, Oregon Arts Commission staff will meet with the Contracting Agency to plan the art selection process.

(2) Each Project will have its own Selection Committee. The Selection Committee is appointed in accordance with, and carries out the functions described in OAR 190-020-0015.

(3) Title for all Works of Art acquired pursuant to ORS 276.073 to 276.090 shall be in the name of the state on behalf of the Contracting Agency or Resident Agency, as determined by the Department of Administrative Services and the Contracting Agency, if the Contracting Agency is an agency other than the Department of Administrative Services.

(4) Works of Art in the state collection are insured by the State Insurance Fund, through the Department of Administrative Services Risk Management Division.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
Renumbered from 190-020-0010, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0012 Public Art Advisory Committee

The Oregon Arts Commission may establish a Public Art Advisory Committee consisting of two Oregon Arts Commissioners and up to seven arts professionals designated by the Oregon Arts Commission. The Oregon Arts Commission may use the Public Art Advisory Committee to make recommendations regarding general policies of the Program. The Public Art Advisory Committee will serve as a review panel for creation of a Roster of Prequalified Artists, may nominate and review artists for consideration by individual Art Selection Committees, and will serve as a review panel for Relocation or Deaccession requests. The Public Art Advisory Committee will not make selections for individual Program projects.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
OBDD 11-2011, f. 12-30-11, cert. ef. 1-1-12
Renumbered from 190-020-0012, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10

Or. Admin. R. 123-475-0013 Prequalified Artist Roster

Experienced and talented artists may be prequalified by the Oregon Arts Commission for Program projects. The Oregon Arts Commission publishes a prospectus inviting applications. The Public Art Advisory Committee serves as the review panel and makes recommendations to the Oregon Arts Commission for inclusion on the Prequalified Artists Roster. Applications may be filed at any time. All artists must reapply at the end of each three-year cycle. The Roster is available to serve as a resource for other public art programs, architecture firms and others seeking artists for projects.

History

Statutory/Other Authority: ORS 359.025; 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
Renumbered from 190-020-0013, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10

Or. Admin. R. 123-475-0015 Selection Committee

(1)(a) A Selection Committee shall be established for each Program Project. The Selection Committee, on behalf of the Designated Agencies, shall determine the scope, direction, and particular needs of the Project. Except as provided in subsection (b) of this rule, the Selection Committee is solely responsible for artist selection, review of design, execution, placement and acceptance of Works of Art, and shall communicate such progress to the Designated Agencies.

(b) Exception to sole responsibility for review: The Oregon Arts Commission and the Contracting Agency shall identify other review bodies whose oversight may be required by law or agency policy including, without limitation, state or local historic preservation committees, city design review committees and formalized campus design committees. In such cases, the Selection Committee’s recommendation will be submitted for review and approval by these bodies prior to execution of any contracts for Works of Art.

(c) Informal committees established by any of the Designated Agencies, such as user groups of a Project, shall be kept informed of Selection Committee progress, but have no role in approval of the Selection Committee’s recommendations. The Designated Agency that establishes an informal committee is responsible for notifying the Selection Committee of the establishment of the informal committee.

(2) The Selection Committee shall consist of up to nine members designated by the Oregon Arts Commission as follows:

(a) The Project Architect;

(b) The Director of the Oregon Arts Commission or designee thereof;

(c) Up to three visual artists or other design professionals appointed by the Oregon Arts Commission (the selection of the design professionals will be made after consultation with the resident agency). The Arts Commission shall strive to appoint Selection Committee members with varied perspectives, including multicultural representation;

(d) The Director of the contracting agency, or designee thereof, most appropriately the planning/construction project manager;

(e) The Chair of the Capitol Planning Advisory Board, or the Chair’s designee, if the project is in Marion or Polk County area (ORS 276 .028);

(f) Up to one representative of each resident agency, or in the case of a University, each program, college or school with significant use of the facility;

(g) Such other people who qualify and are approved by the Designated Agencies.

(3) Up to 5 Non-Voting Advisors may be appointed by the Contracting Agency and Resident Agency of the facility to serve on the screening committee and may include: students, museum director, curator, educator, art historian, collector, and concerned members of the community, or other qualified individuals

(4) Chairman of the Selection Committee: The Public Arts Coordinator of the Oregon Arts Commission shall serve as non-voting chairman.

(5) Voting: Each member of the Selection Committee designated pursuant to Section (2) of this rule will have one vote. A majority vote of members present shall determine the selection recommendations to be made to the Designated Agencies. At least one-half of the members of the Selection Committee must be present to have a vote.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
OBDD 10-2012, f. 6-29-12, cert. ef. 7-1-12
Renumbered from 190-020-0015, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0025 Selection Committee Procedure

(1) The Selection Committee shall meet to consider the particular needs of the Project including budget, suitable art forms, appropriate locations, and method of artist/artwork selection.

(2) The Selection Committee may use any of the following methods for selection of Works of Art for a Project:

(a) Open Competition: A prospectus will be prepared by the Oregon Arts Commission with the approval of the Selection Committee and will be made broadly available to artists. Artists will be asked to submit images or other materials to the Commission. The Selection Committee may commission new work and also may purchase available work.

(b) Two-stage competition. An open competition may occur in two stages whereby a limited number of finalists selected from the first stage of competition will be asked to submit more detailed proposals. Each of the finalists may enter into a contract with the Contracting Agency that provides for payment of a professional fee for preparation of a detailed proposal or consultation interview. The Oregon Arts Commission or Selection Committee may recommend the amount of the professional fee.

(c) Prequalified Artist Roster: The Selection Committee may interview or commission proposals from one or more artists on the Prequalified Artist Roster, or may make direction selection(s) from the Roster.

(d) Nominated Pool: The Selection Committee may designate an informal panel of arts professionals to nominate artists appropriate for consideration for the Project. The resulting pool will be reviewed by the Selection Committee.

(e) The Public Art Advisory Committee may designate an informal panel of arts professionals to nominate artists appropriate for consideration to the State of Oregon Art Collection. The resulting pool(s) may be reviewed by individual Selection Committees.

(f) Limited Competition: In cases when, in the judgment of the Oregon Arts Commission, it is not feasible to conduct an open competition for a specific Work of Art, the Oregon Arts Commission will initiate a Limited Competition by inviting several artists to submit materials to the Selection Committee. If detailed proposals or consultation interviews are requested, each artist will be paid a professional fee for preparation of the detailed proposal or consultation interview. The Oregon Arts Commission or Selection Committee may recommend the amount of the professional fee.

(g) Direct Selection: When budget constraints or construction schedules are such that the Selection Committee determines that an open competition cannot be held, Direct Selection of the artist(s) or completed work will be made by the Selection Committee.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073-276.090
OBDD 11-2011, f. 12-30-11, cert. ef. 1-1-12
Renumbered from 190-020-0025, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0030 Criteria for Selecting Works of Art

(1) Style and Nature: Works of Art of any aesthetic persuasion that are compatible in scale, material, form and content with their surroundings may be considered.

(2) Diversity of the Collection: The Oregon Arts Commission seeks to encourage and maintain a diverse collection for the state, including site-specific works developed with collaboration between an artist and design team, existing works of art created by an artist and purchased for permanent installation, and, when appropriate, documented time-based works or installations.

(3) Quality: The inherent quality of the work itself will be the highest priority for selection.

(4) Media: All forms of Works of Art may be considered. Works of Art may be either portable or permanently affixed or integral to the building or structure, or part of a temporary exhibition.

(5) Permanence: Due consideration will be given to structural and surface soundness and to permanence in terms of relative protection against theft, vandalism, weathering, or excessive maintenance or repair costs.

(6) Method of Acquisition: Either existing works or those commissioned for specific Projects may be acquired.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276.073 – 276.090
OBDD 11-2011, f. 12-30-11, cert. ef. 1-1-12
Renumbered from 190-020-0030, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0035 Inclusions

Appropriations under ORS 276.080 for the Program may be spent for:

(1) The Work of Art itself which may include but is not limited to:

(a) Artist's professional fee;

(b) Labor of assistants;

(d) Professional services such as engineering and fabrication necessary to create or install the Work of Art;

(e) Artist’s studio and operating costs of the artist, including rent, utilities, insurance, and other direct and indirect costs;

(f) Travel costs for the Artist for site visitation and research;

(g) Transportation of the Work of Art to the site;

(h) Installation of the completed Work of Art;

(i) Documentation of the work in progress or completed Work of Art;

(j) Contractual services for professionals engaged to install, maintain or clean Works of Art, and for conservation, restoration, project management or photography.

(2) Identification plaques, labels, and other such educational materials that promote and accurately credit the Artist(s) or project.

(3) Waterworks and electrical and mechanical devices, equipment and site work which are integral parts of the Work of Art.

(4) Frames, mats or pedestals necessary for the security of the Work of Art.

(5) Anchorages, containments and devices necessary for the security of the Work of Art.

(6) Works of Art which may be an integral part of the building.

(7) Expenses described in OAR 190-020-0055(3).

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0035, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0040 Exclusions

Appropriations for the Program may not be spent for:

(1) Reproductions, by mechanical or other means, of original Works of Art.

(2) Decorative, ornamental, or functional elements that are designed by the Architect or consultants engaged by the Architect, as opposed to an Artist commissioned for this purpose.

(3) "Art objects" which are mass produced of standard design.

(4) Directional or other functional elements such as supergraphics, signage, color coding, maps, or other similar elements, except where an Artist is employed to produce them and has primary creative control over the Final Art.

(5) Those items which are required to fulfill the basic purpose of the Resident Agency. Examples would be works of art in the collection of a state museum, or Works of Art fulfilling an interpretive or educational role in a state park, the state library, or a college or university art museum or gallery.

(6) Preparation of the site necessary to receive the Work of Art, including, but not limited to, structural reinforcement, landscaping and utility service to the site, except to the extent the Work of Art is integrated into the structure or site and costs related to construction budget. Any such inclusion of costs for the Work of Art in the construction budget or costs of site preparation included in the art budget must be negotiated among the Designated Agencies and approved by the Oregon Arts Commission.

(7) Energy and water costs for operation of electrical and mechanical systems.

(8) Architect services to comply with OAR 123-475-0050(3)(d).

History

Statutory/Other Authority: ORS 359.025 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0040, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0050 Responsibilities

(1) The Oregon Arts Commission shall:

(a) In consultation with the Designated Agencies, be responsible for selection, reviewing of design, execution, placement and acceptance of Works of Art", acquired under the Program;

(b) Appoint the members of the Selection Committee to carry out the functions described in OAR 123-475-0015;

(d) In consultation with the Resident Agency and Contracting Agency, may transfer Works of Art between public buildings as provided in OAR 123-475-0080;

(e) With the help of professionals, install portable Works of Art and re-hang or relocate Works of Art when it determines such actions are necessary;

(f) In partnership with the Resident Agency, advise regarding necessary maintenance procedures in accordance with the Oregon Arts Commission’s Collection Management System.

(g) Maintain complete records and documentation of the collection with the assistance of the Contracting Agency;

(h) Coordinate public information aspects of the project.

(2) The Contracting Agency shall:

(a) Assist the Oregon Arts Commission with identifying new Projects subject to ORS 276 .073 - 276.090, and shall notify the Oregon Arts Commission when construction budgets are approved and funds are available.

(b) Contract with the Architect for administrative or design services, or both, to be rendered in connection with the commissioning of Works of Art, notify the Architect of the state law requiring a non-deductible allocation for Works of Art and that the Architect will be a member of and must work closely with the Selection Committee for the Project and with the Artist, and include in its contract with the Architect clauses providing for the Architect’s compliance with these rules, including without limitation as provided in section (3) of this rule;

(d) Consult with the Oregon Arts Commission and Screening Committee on the determination of budget and selection procedures;

(e) See that payment is made for all costs, professional fees, purchases and commissions in accordance with all applicable law;

(f) Communicate with the Oregon Arts Commission on Project coordination to assure timeliness of completion of the project;

(g) Contract with the Artist for procurement of Works of Art, including without limitation providing for title to the Works of Art to best in the Contracting Agency or Resident Agency in the name of the state no later than upon completion of installation of the Works of Art.

(h) Together with the Resident Agency, be responsible for security and general maintenance of the Works of Art, including without limitation observing if the Work of Art is in good condition, hanging straight, needs dusting, if labels are missing, or if other measures for security or maintenance are necessary or advisable;

(i) Assist the Oregon Arts Commission with public information aspects of the Project;

(j) Review and authorize all changes proposed involving cost, time, or scope before any changes are made to the Work(s) or Art for the Project;

(k) Assist the Oregon Arts Commission with maintaining an Art Inventory and immediately notify the Oregon Arts Commission if a work needs repair or is missing.

(3) The Architect shall:

(a) Recommend to the Arts Commission and the Contracting Agency specific sites for Works of Art and the scale and type of work thought to be most appropriate;

(b) Act as a member of the Selection Committee;

(c) Work closely with the Artist where required, provide engineering information as it pertains to the building structure and technical assistance to the Artist if requested, and shall supervise the delivery and installation of the Work of Art under contract with the Contracting Agency;

(d) Ensure that all service requirements for the Work of Art are met in the design documents and that the Work of Art may be installed with relative ease.

(4) The Artist shall:

(a) When commissioned by the Contracting Agency to create a Work of Art, execute and complete the Work of Art in a timely and professional manner.

(b) Maintain close contact with the Contracting Agency to assist with Project coordination before and during installation;

(d) Deal personally with the other parties in all phases of the negotiations. However, the Artists may designate dealers or other agents to represent them in negotiations;

(e) Maintain a close working relationship with the Architect on commissioned pieces;

(f) Submit all plans drawings, detailed proposals and other required materials related to a proposed Work of Art to the Oregon Arts Commission. All preparatory work remains the property of the Oregon Arts Commission until the final Work of Art is installed, at which time ownership of the preparatory materials reverts to the artist;

(g) Copyright: The artist retains those rights specified in ORS 359.355 unless contract indicates otherwise.

History

Statutory/Other Authority: ORS 359.025; 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0050, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0055 Scope and Nature of Expenditures

(1) While no more than 1% of the amount from capital construction appropriations may be dedicated to the Program, a dollar total greater than 1% can be expended for art in a Project if the additional funds are generated from other sources. The 1% figure is a minimum.

(2) If 1% of total state funds appropriated for direct construction costs for a particular building is not required for the Program on that Project, such unrequired amounts can be utilized for either or both of the following as determined by the Oregon Arts Commission in consultation with the Contracting Agency:

(a) Acquiring Works of Art for existing state buildings;

(b) Acquiring Works of Art by transferring the funds to another construction project.

(3) Administrative costs for the Works of Art on any particular Project, up to ten percent of the amounts billed by the Oregon Arts Commission to the Contracting Agency, may be funded through the 1% appropriation areas Administrative Costs may include only:

(a) Supplies and services connected with public information and education;

(b) Artists' prospectuses for specific projects;

(d) Salaries of Oregon Arts Commission staff;

(e) Other costs directly related to Program management.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0055, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0060 General Principles and Procedures

(1) Freedom of Expression: Because of the bold attempt to meld the imaginations and talents of so many individuals and groups, freedom to reach creative solutions must always be maintained. Artists must be sensitive to the unique qualities of public art and the guidelines and parameters which, of necessity, may be required.

(2) Integration of Art and Architecture: So that Artists and Architects can gain from each others’ design insights, all parties should strive for engagement of the Artist as soon as possible after the approval of the Architect’s schematic design phase.

(3) Exhibitions and Educational Outreach: Contracting Agencies should consider undertaking the following exhibition and educational outreach opportunities. The Oregon Arts Commission is available to provide consultative assistance, but these activities muse be funded with monies other than Program funds, unless they are a integral part of the Final Art:

(a) Exhibition of sketches and maquettes created in limited or open competitions;

(b) Involvement of students and art instructors in workshops with Artists creating Works of Art;

(d) Use of state educational and other facilities by the Artist in developing concepts and creating the Work of Art, so that state employees and students can better understand the creative process. Such facilities might include studio space, foundries, machine, welding, and woodworking shops, printing and photographic facilities;

(e) Filming or videotaping the creation and installation of the Work of Art.

(4) Accessibility of Information: All parties will strive to publicize widely all aspects of the Program. All meetings of Selection Committees are open to the public.

(5) Community Support and Advice: While firmly committed to the principle of selection of Artists by authorities in the design professions — The Oregon Arts Commission, Department of Administrative Services, and Contracting Agencies welcome participation and advice from the interested public and employees of the Resident Agency.

(6) Conflict of Interest: All procedures will be conducted and all decisions will be made free of any conflict of interest in accordance with ORS chapter 244.

(7) Dedication: If a dedication or "unveiling" of a Work of Art is desired, arrangements shall be the responsibility of the Contracting Agency.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0060, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0065 Documentation and Evaluation

(1) Documentation:

(a) Identification: The Contracting Agency shall assist the Oregon Arts Commission with identification of the Work of Art which may include, without limitation, that plaques or labels identifying the Work of Art, are securely affixed, unobtrusive, and well designed. Plaques, labels or other identifying media shall included the name of the Artist; title of the Work of Art, if any, medium, and year completed;

(b) Registration: The Oregon Arts Commission shall maintain inventory records. The Oregon Arts Commission provides copies of each Contracting Agency’s inventory records upon request by the Contracting Agency;

(c) Publications: Contracting Agencies are encouraged to publish informative folders and booklets on the Works of Art, such as those in the State Library and the Department of Administrative Services. The Oregon Arts Commission is available to assist with editorial and technical assistance.

(2) Evaluation: The Oregon Arts Commission shall annually make a public report on the projects of the previous year and shall conduct periodic evaluations of the Program.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0065, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10
AC 1-1991, f. 3-22-91, cert. ef. 3-21-91
AC 1-1979, f. & ef. 7-23-79

Or. Admin. R. 123-475-0074 Relocation and Deaccession

(1) Each Relocation and Deaccession action shall be determined on a case-by-case basis. Standards applied to Deaccession shall be at least as stringent as those applied to the acquisition process.

(2) Changes in fashion, taste, administration or the immediate pressures of public controversy are insufficient to support a Relocation or Deaccession action.

(3) Relocation or Deaccession will not be considered until at least five years have elapsed from the date of completion identified under OAR 123-475-0065(1)(a) of permanent Works of Art and acceptance in the case of portable Works of Art, unless special circumstances exist. Special circumstances include, without limitation, when a Work of Art has been damaged beyond repair.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0074, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10

Or. Admin. R. 123-475-0080 Criteria for Relocation or Deaccession

The Oregon Arts Commission may approve a request to consider Relocation or Deaccession of a Work of Art for one or more of the following reasons:

(1) The artwork requires unforeseen excessive maintenance or repair, contains failing materials, faults of design or workmanship, or repairing or securing the Work of Art is or becomes impractical or unfeasible;

(2) It would benefit the collection re replace the Work of Art with another more significant Work of Art by the same Artist;

(3) The Work of Art has been the source of significant, documented adverse public reaction over at least five years, and a broad range of people who come into regular contact with the Work of Art support its removal;

(4) The condition or security of the Work of Art cannot reasonably be guaranteed;

(5) The Work of Art has become significantly less appropriate over time, given changes in the function or character of the collection, setting or the community;

(6) The site is going to be demolished or adapted, and it is not possible to successfully incorporate the Work of Art into redevelopment of the site;

(7) The site is not longer publicly accessible;

(8) There is not suitable new site available for the Work of Art in the same facility;

(9) The Work of Art endangers public safety.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0080, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10

Or. Admin. R. 123-475-0085 Procedure for Relocation or Deaccession

(1) The Public Art Advisory Committee will undertake periodic reviews of the collection and review all Relocation and Deaccession requests submitted to the committee by Oregon Arts Commission staff on behalf of the Arts Commission, a Resident Agency, or the public.

(2) The Public Art Advisory Committee shall make recommendations to the Oregon Arts Commission on all Relocation and Deaccession requests.

(3) Sequence of Action.

(a) Upon receipt of a request for Relocation or Deaccession by a Resident Agency, citizen(s), or the Oregon Arts Commission or its staff, Oregon Arts Commission staff shall prepare a report to the Public Arts Advisory Committee that shall include the condition of the Work of Art, recent photographs, estimated value, reasons for considering Relocation or Deaccession and addressing the criteria contained in OAR 123-475-0080, options for relocating or repairing the Work of Art when applicable, opinion of the head of the Resident Agency, and any other supporting or relevant information.

(b) The Public Art Advisory Committee shall review the report and may direct Oregon Arts Commission staff to seek additional information about the Work of Art from the community where it is installed, the Artist, art galleries, curators, conservators, appraisers or other arts professionals.

(c) The Public Art Advisory Committee shall recommend to the Oregon Arts Commission whether the request for Relocation or Deaccession should be denied or granted in whole or in part. The Public Arts Advisory Committee may recommend modifying, relocating, selling, donating, disposing of or storing the Work of Art. The recommendation must address the following:

(A) Criteria contained in OAR 123-475-0075, if any, that have been met;

(B) Most appropriate action and method of action;

(C) Specific recommendation if the Work of Art is to be traded or sold for the purpose of purchasing another Work of Art by the same Artist;

(d) The Oregon Arts Commission staff shall prepare a report for consideration by the Oregon Arts Commission at a regularly scheduled meeting that includes at least the following:

(A) The Public Art Advisory Committee’s recommendations;

(B) The opinion of the head of the Resident Agency;

(C) To the extent required by any contract between the Contracting Agency and the Artist, the opinion of the Artist, if living, if the Artist has provided an opinion.

(e) If the Oregon Arts Commission determines that a Relocation or Deaccession request may be granted, the Oregon Arts Commission will notify the Contracting Agency of its approval.

(4) Method for Relocation: On rare occasions, a Work of Art in the State of Oregon Public Art Collection may be removed from its original location in a State Building. Works of Art will be removed only with the approval of the head of the Resident Agency (or designee), and the Oregon Arts Commission. When considering new locations, the following criteria apply:

(a) The new location must be a State Building;

(b) If the new location is a different facility, the new Resident Agency must be willing to accept the Work of Art on long-term loan, for a period of at least five years.

(c) If the new location is a different facility, the new Resident Agency must be willing to provide for security and maintenance of the Work of Art.

(d) The new location must be viewed by a broad range of citizens.

(5) Methods of Deaccession: Works of Art will be deaccessed only with the approval of the Head of the Resident Agency (or designee) and the Oregon Arts Commission. Deaccession shall be accomplished in one of the following manners as determined by the Oregon Arts Commission to be in the best interests of the citizens of Oregon, the State of Oregon Public Art Collection, and the public trust invested in the Oregon Arts Commission as the steward of the collection:

(a) Sale or Trade.

(A) If the Work of Art has not been appraised in the past five years, a certified appraisal will be conducted.

(B) If stated in the approved recommendation, the Artist will be given first option to purchase or trade the Work of Art.

(C) Sale may be by auction, gallery resale or direct bidding by individuals, in compliance with state law and policies governing surplus property.

(D) Trade may be through the Artist or gallery, museum or other institution for one or more Works of Art of comparable value by the same Artist.

(E) No Works of Art may be sold or traded to members or staff of the Arts Commission or Public Art Advisory Committee or their immediate families.

(F) Proceeds from the sale of a Work of Art shall be used to purchase artwork in keeping with the definitions and limitations of the Program and in accordance with the Oregon Arts Commission’s decision to approve Deaccession. Funds may be expended with the oversight of the Public Art Advisory Committee. Any preexisting contractual agreements between the Artist and the state regarding resale shall apply.

(b) Destruction of a Work of Art that is deteriorated or damaged beyond repair, or beyond value of the Work of Art, and therefore deemed to be of negligible value. Alternatively, the Work of Art may be returned, in present condition, to the Artist, if living, to the state or representative of the Artist, or to an art conservation research or training facility as a disposable Work of Art.

(c) If the Oregon Arts Commission is unable to dispose of the Work of Art in a manner described in this section, the Work of Art may be donated to a non-profit organization or otherwise disposed of as the Oregon Arts Commission determines reasonable.

(6) Costs for Relocation or Deaccession. Unless otherwise requested by a person or agency requesting Relocation or Deaccession and approved by the Public Art Advisory Committee, costs for appraising, cleaning or minor repairs to a Work of Art as needed to be suitable for display should be charged to the original Resident Agency. Transportation to storage or a new location should be charged to the original Resident Agency. Installation or any major conservation, reframing, or similar activity should be charged to the new Resident Agency. Costs may be negotiated in the best interests of each entity.

(7) Compliance with Applicable Policies and Regulations. Decaccession of Works of Art shall be done in a manner that complies with all other applicable state and federal law. For example, Decaccession must comply with applicable procedures and laws relating to the disposition of State property and with laws protecting Artists’ rights.

History

Statutory/Other Authority: ORS 359.025 & 359.142
Statutes/Other Implemented: ORS 276 .073 - 276 .090
Renumbered from 190-020-0085, OBDD 36-2010, f. 10-14-10, cert. ef. 11-1-10
OAC 1-2010, f. 6-30-10, cert. ef. 7-1-10

Division 500 CULTURAL PARTICIPATION GRANTS

Or. Admin. R. 123-500-0000 Purpose

The Arts Program, under the direction of the Cultural Trust Board, awards grants for the Oregon Cultural Trust through three grant programs: Cultural Development Grants to cultural organizations, Community Cultural Participation Grants to county and tribal cultural coalitions and Cultural Partner Grants to statewide cultural partner entities.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0005 Definitions

(1) “Cultural Organization” means an organization defined in ORS 359.400.

(2) “Cultural Trust Board” means the board established by ORS 359.410.

(3) “Cultural Coalition” is a group organized in an Oregon county or within a federally recognized Indian Tribe, in Oregon to identify priorities and specific strategies for building public participation in culture. Each coalition will include representation from the arts, heritage, humanities and other organizations relevant to community cultural participation, including without limitation, educational institutions, libraries, media or businesses, and reflect the diversity of the County or Tribe. The primary purpose of the coalition is to develop a cultural plan for the area served and to award and monitor grant funds awarded to address cultural goals.

(4) “Cultural Plan” means a local plan that identifies priorities and specific strategies to build public participation in cultural disciplines and organizations within the local area. Plans will include benchmarks to measure progress against stated goals.

(5) “Core Partner Agencies” means the agencies described in ORS 359.400(2).

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0010 Purpose

(1) The purpose of the Cultural Trust’s Cultural Development Grant program is to provide state recognition and support to cultural organizations undertaking significant cultural programs and projects, preserving and enhancing Oregon’s diverse arts, heritage and humanities efforts. “Cultural Development Grant Program” means the program created by ORS 359.431.

(2) Cultural Development Grants are awarded annually on a competitive basis pursuant to a process that is initiated when the Cultural Trust Board issues a request for proposals (RFP). The RFP will request proposals that address one or more of the following themes:

(a) Access: Making culture broadly available to Oregonians;

(b) Preservation: Investing in Oregon’s cultural heritage by recovering and preserving historic assets and achievements;

(c) Creativity: The making or presentation of artistic or scholarly work, and the development of artists, cultural experts and scholars;

(d) Capacity: The strengthening of cultural organizations to build stability and generate public confidence.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0015 Applications and Eligibility

(1) Applications must be submitted in the form required, and by a deadline set, in the RFP.

(2) Applicants for Cultural Development Grants must be an Oregon cultural organization.

(3) Proposals submitted by institutions of higher learning must be for programs and activities that focus on, benefit, and are open to the general public, and the general public must form the majority of the total audience.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0035 Evaluation Criteria

Cultural Development Grant applications are evaluated according to how they address the themes described in OAR 123-500-0010(1). Additional evaluation criteria include:

(1) Significance of the activity or the project, including the quality of the organization(s), structures, works of art, or services that will be involved;

(2) The potential to broaden or deepen public knowledge, understanding, appreciation of, and access to culture;

(3) The appropriateness of the budget, the quality and clarity of the project goals and design, the resources involved, and the qualifications of the project's personnel;

(4) Evidence of sound fiscal management;

(5) Evidence of public or private matching funds or in-kind services;

(6) The process by which the project will be evaluated and plans in place to sustain or maintain the activity or project, if appropriate, following the period of the grant.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0045 Use of Grant Funds

(1) Cultural Development Grant funds must be used:

(a) To address significant opportunities to advance, preserve or stabilize cultural resources;

(b) To invest in the development of new resources;

(d) To support proposals from applicants with culture as a priority within the mission of the organization.

(2) Cultural Development Grant funds may not be used for:

(a) Indirect costs;

(b) Tuition assistance or scholarships for college, university, or other formal courses of study;

(d) Grants to offset previous project deficits; and

(e) Events whose primary focus is to raise funds for a non-cultural cause.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0055 Grant Award Process; Administration of Grants

(1) Applications submitted to the Oregon Cultural Trust pursuant to its RFP will be reviewed by staff to determine whether the applicant is eligible to receive a Cultural Development Grant. Ineligible applications will be returned to applicants with an explanation.

(2) Applications from applicants eligible to receive a Cultural Development Grant will be reviewed by a panel of cultural professionals designated by the Cultural Trust Board who will make funding recommendations to the Cultural Trust Board.

(3) The Cultural Trust Board evaluates qualified proposals and determines final grant awards. Announcement of grants are made as provided in the RFP.

(4) Grants are administered by the Arts Program of the Oregon Business Development Department.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0070 Deadline

Cultural Participation Grant contact information must be submitted to the Oregon Cultural Trust by a postmark deadline that will be established annually.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 359.400 - 359.444
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0075 Grant Contract; Final Reports

Grant recipients are required to enter into a contract with the Arts Program of the Oregon Business Development Department. Pursuant to that contract, each grant recipient must complete a final expense and narrative report. Final financial reports must reflect the application budget as originally submitted unless the budget is revised with the approval of the Cultural Trust Board or its designee. Grant reports must be submitted within thirty (30) days of the end date of the grant period.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0080 Purpose

The purpose of the Cultural Trust’s Community Cultural Participation Grant program is to provide funds to counties and federally recognized Indian Tribes to support local cultural activities involving the arts, heritage and humanities.

(1) This program is intended to increase public participation in culture to actively support and enjoy the cultural resources in their communities and foster the development of a unique cultural identity for counties and tribes.

(2) The program's focus is on local cultural planning, with each county, and each federally-recognized Indian Tribe, building participation in, gaining access to, and shaping priorities of local culture.

(3) The program encourages inter-organization and inter-disciplinary collaboration, along with support for excellence.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0090 Eligibility

(1) Each Oregon county, and each federally-recognized Indian Tribe, may establish a Cultural Coalition responsible for developing, implementing and monitoring a local cultural plan.

(2) The Cultural Trust will award Cultural Participation Grant funds annually to each cultural coalition working within a cultural plan that has been approved by the Cultural Trust Board.

(3) In accordance with its plan, the Cultural Coalition may decide how these funds are allocated locally.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
Renumbered from 123-500-0020, OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0100 Structure of Cultural Coalition

(1) The structure of the Cultural Coalition reflects the cultural needs, assets and resources of each county and tribe.

(2) To qualify for grant funds, a Cultural Coalition must:

(a) Include representation from the arts, heritage, and humanities activities in their area;

(b) Include representation of other organizations that are relevant to community cultural participation, including without limitation educational institutions, libraries, media or businesses;

(3) The size of the Cultural Coalition will vary depending on local needs. There should be sufficient numbers to represent arts, heritage and humanities plus other "at large" members from the community, including but not limited to business, education, media and libraries.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
Renumbered from 123-500-0030, OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0110 Fiscal Oversight

(1) Coalitions that are recognized by the Internal Revenue Service as a 501-c-3 private non-profit organization, or are a local public entity is eligible to receive Community Cultural Participation Grants directly from the Cultural Trust.

(2) Those coalitions that do not have IRS 501-c-3 non-profit status must identify a fiscal sponsor to accept grant funds on behalf of the coalition. The Cultural Trust Board will review and approve the proposed fiscal agent prior to the release of grant funds.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
Renumbered from 123-500-0040, OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0120 Standards for Cultural Plans

(1) Cultural Participation Grant funds may be awarded to any Oregon cultural coalition that operates under a cultural plan that has been approved by the Cultural Trust Board.

(2) A cultural plan may be approved by the Cultural Trust Board if it has determined that a local cultural plan:

(a) Identifies priorities and specific strategies for building public cultural participation across cultural disciplines and organizations. The strategies may include the involvement of partners outside of the cultural sector such as business organizations, schools and health and human service organizations;

(b) Identifies annual benchmarks to determine the impact of grant funds; and

(c) Specifies local leadership and governance for grant fund management and for ongoing planning and development of benchmarks.

(3) Local cultural plans shall be broadly disseminated within each county or tribe. The local cultural plans shall be used to encourage public discussion, planning and collaboration among cultural entities and to stimulate County and Tribal cultural programs, including collaborations with other entities.

(4) Grant funds received by a county or tribe shall be distributed locally as specified in the approved local cultural plan.

(5) A portion of the grant funds received each fiscal year by a county or tribe may be used for costs associated with grant management, community technical assistance and accounting.

(6) The Trust for Cultural Development Board shall allocate grant amounts for counties and tribes using a base amount, plus a per capita amount for each county or tribe that has adopted a cultural plan approved by the Trust for Cultural Development Board.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
Renumbered from 123-500-0050, OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0130 Cultural Participation Grant Allocation Process

(1) Annually, on a date established each year by the Cultural Trust Board and on a form or online system provided by the board, a cultural coalition must submit to the board current contact information for the coalition chair, coalition members and fiscal sponsor, if applicable.

(2) The Cultural Trust Board will allocate final grant awards pursuant to a formula determined by the board. The formula includes a base allocation per county and tribe plus an additional amount factored on population.

(3) The Arts Program, under the direction of the Cultural Trust Board, shall distribute the grant amounts to the cultural coalitions.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
Renumbered from 123-500-0060, OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10
EDD 3-2009, f. 4-30-09, cert. ef. 5-1-09

Or. Admin. R. 123-500-0150 Purpose

The Arts Program, under the direction of the Cultural Trust Board, awards grant funds to five statewide cultural entities to promote arts, heritage and humanities programs across Oregon and leverage existing resources to benefit more Oregonians.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0160 Distribution of Funds

The Arts Program, under the direction of the Cultural Trust Board, shall distribute the amount disbursed from the Trust for Cultural Development Account under ORS 359.426(3)(c) to the core partner agencies as follows:

(1) 20 percent of the amount disbursed under ORS 359.426 (3)(c) for joint efforts by the core partner agencies in fostering cooperative cultural projects, including but not limited to cultural education, cultural tourism and other cultural activities; and

(2) 80 percent of the amount disbursed under ORS 359.426(3)(c) to the core partner agencies for the purposes described in 359.444. The Cultural Trust Board shall determine the amount or percent of available funds that each core partner agency shall receive under this paragraph.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0170 Limitations

The core partner agencies are not eligible to apply for grants from the Community Cultural Participation Grant Program or the Cultural Development Grant Program.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Or. Admin. R. 123-500-0175 Allowable Uses of Funds by Core Partner Agencies.

(1) A core partner agency may use Cultural Partner Grant funds to:

(a) Carry out the mission and mandate of the agency;

(b) Serve more grantees; and

(2) Each core partner agency shall expend a portion of the amount received under ORS 359.426 as determined by the Cultural Trust Board each fiscal year to fund development of qualitative benchmarks and culture within Oregon.

History

Statutory/Other Authority: ORS 359.416
Statutes/Other Implemented: ORS 359.400 - 359.444
OBDD 6-2010, f. 2-25-10, cert. ef. 3-1-10

Division 600 BUSINESS ENERGY TAX CREDITS FOR RENEWABLE ENERGY RESOURCE EQUIPMENT MANUFACTURING BETC (MANUFACTURING BETC)

Or. Admin. R. 123-600-0100 Purpose and Scope

This division of administrative rules applies to all applicants for the Business Energy Tax Credit for Renewable Energy Resource Equipment Manufacturing (“Manufacturing BETC”) as provided under Oregon Revised Statutes 285C.540 through 285C.559, and 315.341, 356, Oregon Law 2011 Ch. 474 HB 2523 and 2012 Ch. 45 HB 4079. These rules apply to all applications pending as of the effective date of these rules.

(1) Amount of Tax Credit. Qualified Oregon facilities that manufacture renewable energy resource equipment may be eligible for a tax credit equal to 50% of maximum eligible cost. Costs are limited up to $2.5 million for a facility used to manufacture electric vehicles or component parts of electric vehicles and up to $40 million in the case of any other eligible facility.

(2) Application Review. Application for the Manufacturing BETC is subject to detailed technical and financial review of the project. The Applicant is also required to sign a performance contract with measures that include job creation requirements, job retention requirements and other economic or operational benchmarks as determined by the Department.

(3) Certification of Cost for Tax Credit. The Director shall issue a final certificate pursuant to ORS 285C.553 before the tax credit can be claimed. The Director shall determine the dollar amount certified for any facility and the priority between applications for certification based upon the criteria contained in ORS 285C.540 to 285C.559 and applicable rules and standards adopted under ORS 285C.540 to 285C.559. The Director may consider the status of a facility as a research, development or demonstration facility of new renewable resource generating and conservation technologies in the determination.

(4) Use of Tax Credit. The tax credit may be offset against Oregon income and corporation excise taxes owed pursuant to ORS 315.341. An Applicant qualifying for the tax credit may transfer the tax credit through the pass-through option in return for a discounted cash payment from a qualified pass-through partner.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0105 Definitions

The following definitions apply unless the context requires otherwise:

(1) “Applicant” means a person who applies for preliminary certification of a Manufacturing BETC facility under this section including individuals, corporations, associations, firms, partnerships, limited liability companies and joint stock companies.

(2) “Cost” means the capital costs and expenses necessarily incurred in the erection, construction, installation and acquisition of a facility.

(3) “Completed application” means receipt of payments under OAR 123-600-0140 and all information required in the application form to demonstrate substantive compliance with the provisions of ORS 285C.540 to 285C.559 and any applicable rules or standards adopted by the Director, and all supplemental attachments, exhibits and so forth that the Applicant furnishes at the Department’s request under these rules for the Manufacturing BETC.

(4) “Completed Facility” means a manufacturing facility that is operating in accordance with requirements in the Preliminary Certificate and performance agreement between the Department and the Applicant for which all costs have been paid or committed by a binding contract or agreement.

(5) “Component parts of electric vehicles” means component parts that are for exclusive use in electric vehicles and may not be used in both electric and conventional vehicles. A component part of electric vehicles does not include batteries.

(6) “Director” means the Director of the Oregon Business Development Department or designees.

(7) “Department” means the Oregon Business Development Department, aka: Business Oregon.

(8) “Electric vehicles” means vehicles that are designed for use as Class I or Class II all-terrain vehicles, as those terms are defined in ORS 801.190 and 801.193, and that are used for agricultural, commercial, industrial or governmental purposes, or vehicles that are designed for use as modes of transportation on public roads and highways. The Director of the Oregon Business Development Department may further define “agricultural, commercial, industrial or governmental purposes” of electric vehicles.

(9) “Facility operator” means the person or people to whom the Applicant gives authority to manage a facility. Such person or people shall be the Applicant’s agent for all reasons related to the facility once its development begins.

(10) “Facility start” means the earliest date on or after the date the application for preliminary certification is received by the Department where a non-refundable deposit will be placed on the facility equipment or; a purchase order will be placed for the equipment or; a contract for the design of the facility will be executed or; a document that obligates the Applicant to proceed with a facility will be executed; or any other type of financial commitment towards the erection, construction, installation or acquisition of the facility.

(11) “Federal grant” means any grant received from the federal government in connection with a facility.

(12) “Final certification” means the review and approval of the application for final certification leading to issuance of a final certificate for a completed facility under ORS 285C.551.

(13) “Lease contract” means a lease-purchase contract in which the lessee owns the facility at the end of the lease and is eligible for the Manufacturing BETC, or a lease or lease-option contract in which the lessor owns the facility through the life of the contract and is eligible for the Manufacturing BETC.

(14) “Pass-through payment” means a minimum cash payment equivalent to the net present value of the Manufacturing BETC as determined under OAR 123-600-0135. This is also referred to as the “pass-through rate.”

(15) “Pass-through option” means the option that allows an Applicant a one time only transfer of all or a portion of the facility’s tax credit eligibility to certain persons or businesses in return for a cash payment.

(16) “Pass-through partner” means a personal income tax payer, individual, C corporation or S corporation that is transferred a tax credit certificate in return for a cash payment to an Applicant.

(17) “Preliminary certification” means the review and approval of the application for preliminary certification leading to issuance of a preliminary certificate for an eligible facility under ORS 285C.551.

(18) “Renewable energy resource” means energy derived from sources including but not limited to: straw, forest slash, wood waste or other wastes from farm or forest land, nonpetroleum plant or animal based biomass, ocean wave energy, solar energy, wind power, water power or geothermal energy.

(19) “Renewable energy resource equipment manufacturing facility” means any structure, building, installation, excavation, device, machinery or equipment, or an addition, reconstruction or improvement to land, to an existing structure, building, installation, excavation or device or to existing machinery or equipment, that is necessarily acquired, constructed or installed by a person in connection with the conduct of a trade or business and that is used primarily to manufacture:

(a) Component parts of electric vehicles.

(b) Electric vehicles.

(c) Equipment, machinery or other products designed to use a renewable energy resource and that meets the criteria established under ORS 285C.543 and these rules.

(d) Renewable energy storage devices. [2011 c.474 §5]

(20) “Renewable energy storage device” means a device that enables the storage of energy derived from renewable energy resources. A renewable energy storage device a facility does not need to be directly connected to a renewable energy resource, but a beneficial relationship shall be demonstrated between the energy output of the resource or resources and the charge and discharge capabilities of the facility. The storage device may be designed to store energy for transmission lines provided that the transmission lines serve, at least in part, renewable energy resources. A renewable energy storage device includes, but is not limited to, batteries or similar devices used to provide propulsive energy in electric vehicles.

(21) “Research, development, or demonstration facility (RDD)” means a facility under ORS 285C.545 (3) and subject to standards adopted by the Director in these rules that is not standard practice and produces or is likely to produce new renewable resource generating and conservation technologies or products in Oregon when commercialized.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0110 Process Overview

(1) Application Stages. The Department reviews an application for a Manufacturing BETC in two stages.

(a) The first stage is called preliminary certification. Prior to submitting an application and fee payment, the Applicant must contact the Department to initiate a pre-screening process. Once accepted, the application is subject to in-depth review of the manufacturer’s technology, financial model and plan, which may be conducted by a third party contractor selected by the Department for the purpose of determining if a preliminary certificate shall be issued. If the Department determines that the Applicant qualifies for a Manufacturing BETC, the Department may issue a preliminary certificate. The preliminary certificate may contain specific criteria and conditions for the facility to meet in order to complete final certification based on the information provided in the application for the BETC and type of facility that is described in the application. In addition, the Department shall require the Applicant to enter into a performance agreement or other similar agreement as a condition of approval.

(b) The second stage is called final certification. During this stage the application is subject to verification of completion of the facility in accordance with conditions and criteria imposed in the preliminary certificate and performance agreement, and the determination of final eligible costs for purpose of issuing the final tax certificate.

(2) Application. To begin the review process for each stage as described in 123-600-0120 and 123-600-0130, or to change the facility during the review process, an Applicant shall submit the information on the application form approved by the Department and additional information as requested by the Department.

(3) Receipt of Applications. Applications shall be considered received on the date marked received by the Department, unless the application is determined to be incomplete.

(4) Pass-through Option Commitment. An Applicant planning to use a pass-through partner should indicate their intention on the application for preliminary certification and shall select the pass-through option on the application for final certification.

(5) Conditions for Approval. The Director may impose conditions in approving a preliminary or final certificate that the facility shall operate in accordance with the representations made by the Applicant, and any applicable rules or standards adopted by the Director in accordance with the provisions of ORS 285C.540 to 285C.559.

(6) Separate and Distinct Facilities. The Director may issue only one Manufacturing BETC for each separate and distinct facility under these rules. To determine if a facility is separate and distinct, the Director will consider such factors as phases of development, expansion of or additions to existing facilities or product lines, increased production and number of jobs created or maintained by an Applicant.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0120 Preliminary Certification

(1) Pre Screening. Persons interested in applying for a Manufacturing BETC shall first contact the Department to initiate a pre-screening process.

(2) Submission of Application. Persons determined by the Department to have projects for proposed facilities eligible for a Manufacturing BETC shall submit the application form approved by the Department for application for preliminary certification along with the appropriate fee under OAR 123-600-0140. The Applicant shall also provide additional information the Director considers necessary to determine whether the proposed facility is in accordance with the provisions of ORS 285C.540 to 285C.559 and these rules, including but not limited to:

(a) The type of equipment, machinery or other products being manufactured meet related performance and efficiency standards applicable to the manufactured products;

(b) The economic viability of the facility and any other information for consideration of such factors as phases of development, expansion of or additions to existing facilities or product lines, increased production and number of jobs created or maintained by the Applicant;

(d) The compensation paid and benefits provided to employees meet or exceed the national average in annual compensation for comparable employment;

(e) Details related to the technology and financial plan that can be independently reviewed by a third party;

(f) The credit worthiness of the Applicant and the likelihood of long-term operation and success of the facility; and

(g) The Applicant’s decision to locate or expand a facility in Oregon is based on the allowance of a tax credit under ORS 315.341.

(3) Qualified Applicant. A qualified Applicant shall meet one of the following criteria:

(a) The Applicant is a person to whom a tax credit for the facility has been transferred; or

(b) The Applicant shall be the owner, contract purchaser or lessee of the facility at the time of erection, construction, installation or acquisition of the proposed facility, and:

(A) The Applicant is the owner, contract purchaser or lessee of a trade or business that plans to utilize the facility in connection with Oregon property; or

(B) The Applicant is the owner, contract purchaser or lessee of a trade or business that plans to lease the facility to a person that will utilize the facility in connection with Oregon property.

(C) The Applicant is the owner, contract purchaser or lessee of a trade or business that plans to lease the facility to a person that will utilize the facility in connection with Oregon property.

(4) Eligible Costs. Subject to the facility cost limitations of OAR 123-600-0100(1) and the criteria established under ORS 285C.543:

(a) Eligible costs include land purchase costs, structures, buildings, installations, excavations, machinery, equipment or devices, or any addition, reconstruction or improvements to land or existing structures, buildings, installations, excavations, machinery, equipment or devices, necessarily acquired, constructed or installed by a person in connection with the conduct of a trade or business, that is used to manufacture the equipment, machinery or other products used primarily for:

(A) Component parts of electric vehicles; or

(B) Electric vehicles; or

(D) Equipment, machinery or other products designed to use a renewable energy resource.

(b) An application shall demonstrate compliance with these provisions to be accepted, including clearly describing the specific characteristics of the equipment, machinery or other products that demonstrate why such equipment, machinery or other products will be used primarily for component parts of electric vehicles or; electric vehicles; renewable energy storage devices or; equipment, machinery or other products designed to use a renewable energy resource that meets the criteria established under ORS 285C.543 and not for other commercial purposes and therefore why the costs of such of such equipment, machinery or other products are eligible costs.

(d) Eligible facility costs are limited by costs for a facility, or portion thereof, that has previously received a Business Energy Tax Credit.

(e) The sum of any payments from federal grants and the Manufacturing BETC may not exceed total costs.

(f) Eligible costs do not include fees or costs associated with the review of the application.

(g) Eligible costs cannot be incurred prior to submitting an application for preliminary certification, except as provided for under OAR 123-600-0120(7).

(h) Cost can include payments for:

(A) Fees to finance, design or engineer the facility, including but not limited to debt fees and equity fees;

(B) Title searches, escrow fees, government fees, excluding fees required by OAR 330-091-0150, and shipping;

(C) All materials and supplies needed for the erection, construction, installation or acquisition of the proposed facility; and

(D) Work performed by employees or independent contractors of the applicant based on the following conditions:

(i) Employees or contractors must be certified, accredited, licensed, or otherwise qualified to do the work;

(ii) The work must be associated with the erection, construction, installation or acquisition of the proposed facility or in the case of a research development and demonstration facility, the work shall be directly related to the research, development, demonstration, facility design, monitoring, assessment, evaluation and reporting related to the product or technology;

(iii) Project management and other similar costs may only account for up to 15 percent of the total eligible costs; and

(iv) Costs for employee’s or contractor’s work on the facility must be detailed and documented as to specific tasks, hours worked, and compensation costs. Donated, in-kind or volunteer labor is not eligible;

(E) Costs for legal counsel that is directly related to the development of a qualifying facility (non-litigation related) or directly linked to the research, development or demonstration facility; and

(F) Other costs the Director includes.

(i) Cost may not include:

(A) Interest;

(B) Litigation or other operational-related legal fees and court costs;

(D) Administrative costs to apply for grants, loans, tax credits or other similar funding for a facility including, but not limited to, the BETC charge, costs associated with the creation and development of the CPA verification letter and costs associated with securing a pass-through partner for the facility;

(E) Routine operational or maintenance costs associated with the facility, including services, supplies and labor;

(F) Expenses that are directly or indirectly offset with federal fee waivers; and

(G) Other costs the Director excludes.

(j) If a facility is built under a lease, lease-option or lease-purchase contract, the lessee's cost to acquire the facility is the value paid for the facility. If that amount is not known, the cost is the sum of:

(A) Tax credits passed-through by the lessor to the lessee;

(B) The amount paid when the facility is transferred; and (C) The lease payments not including taxes, insurance, interest, and operating costs.

(5) Preliminary Certification Review Process. Except as provided in OAR 123-600-0120(7), an application for preliminary certification shall be received by the Department on or prior to the facility start for the erection, construction, installation or acquisition of a facility.

(a) The application for preliminary certification shall be considered received on the date marked received by the Department, unless the application does not contain all information required in the application form and the payment as required in OAR 123-600-0140.

(b) An application is incomplete if it does not include information needed to demonstrate substantive compliance with the provisions of ORS 285C.540 to 285C.559 and any applicable rules or standards adopted by the Director. The Department shall provide the Applicant a written notice relating to the incomplete application and the information needed to make the application complete. If no action is taken within 30 days by the Applicant, the application shall expire.

(c) After a completed application is received, the Department shall notify the Applicant of the procedures for the Department’s due diligence review.

(d) If the application complies with the provisions of ORS 285C.540 to 285C.559, the Director may approve the preliminary certificate. The preliminary certificate shall state the amount of eligible costs for a Manufacturing BETC up to the maximum amount of certifiable costs under ORS 285C.545. It may differ from the amount requested for reasons explained and based on these rules. Also, it shall state any conditions that shall be met before development, final certification, or some other event can occur. The Director shall explain why each condition is needed to comply with these rules.

(e) If it does not comply, the Director may deny the application. No later than 60 days after the Director issues an order denying the application, the Applicant may request reconsideration as provided in these rules.

(f) An Applicant can re-submit an application that is denied if features of the facility change, the Applicant provides data the absence of which resulted in the denial, or other changes warrant. An application for preliminary certification can be amended or withdrawn by the Applicant before the Director issues a preliminary certificate. The Applicant may be required to pay additional fee for expenses incurred by the Department in connection with the additional review of the application for preliminary certification or amendment to the preliminary certificate.

(6) Preliminary Certification for Less than Total Eligible Costs. If under the provisions of ORS 285C.545(2), the Department intends to certify less than the total or no amount of eligible costs of renewable energy resource equipment Manufacturing BETC facility, the Department shall notify the Applicant in writing of that intent before approving the preliminary certificate.

(a) The Applicant shall have 30 calendar days from the date notification was issued to inform the Department in writing whether it wishes to withdraw the application or suspend further consideration of the application until a future date specified or submit additional information in support of the application.

(b) If the Department has not received notification or additional information in support of the application within that period of time, the Director may certify less than the total or no amount of eligible costs of the Manufacturing BETC facility.

(c) Once eligible costs are certified and a preliminary certificate is issued under this section, the certified eligible costs may be revised if conditions under ORS 285C.545(2) change or upon notification from the Applicant or other information indicating that the scope of the project or the facility has changed in such a way to impact the preliminary certificate.

(7) Eligibility of Costs Before Facility Start. The Director may approve a preliminary certificate for costs incurred prior to the Department’s receipt of the application for preliminary certification if the Applicant files a written request for a waiver in accordance with these rules.

(a) Special circumstances beyond the Applicant's control made application for preliminary certification before facility start impracticable. Such circumstances include process delays, facility funding and energy supplies or markets; and

(b) The Department is in receipt of the application for preliminary certification and receives a waiver request from the Applicant within 90 days of the facility start. Under extraordinary circumstances the Department may extend the waiver period provided the facility serves the aims of the program.

(c) Failing to submit an application for preliminary certification before signing contracts for the facility does not constitute special circumstances supporting a waiver.

(8) Preliminary Certificate. If the Department determines that the application for preliminary certification qualifies the Applicant and the facility for a Manufacturing BETC, the Director may issue a preliminary certificate.

(a) The preliminary certificate may contain specific criteria and conditions for the facility to meet in order to complete final certification based on the information provided in the application for the BETC and type of facility that is described in the application. In addition, the Department shall require the Applicant to enter into a performance agreement or other similar agreement as a condition of approval. The Director may consider a broad range of comparative data sources in determining criteria and conditions for job creation, job maintenance and compensation in the preliminary certificate or performance agreement, including but not limited to:

(A) National Compensation Survey (NCS), US Department of Labor Bureau of Labor Statistics

(B) Quarterly Census of Employment and Wages, US Department of Labor Bureau of Labor Statistics

(C) Oregon Labor Market Information System including the Oregon Employment Department’s most current Covered Employment and Wages Summary Report for Total Private Coverage.

(b) If the facility does not proceed the Applicant shall inform the Department in writing if it does not proceed with the facility or intends to proceed without the tax credit. In that case, the Director shall cancel the preliminary certificate.

(9) Applicant’s Request to Amend a Preliminary Certificate. An Applicant shall file a written request with the Department prior to the completion of the facility to amend a preliminary certificate.

(a) The request shall describe the change to the facility and reasons for the change. It may include changes in cost, tax credit amount, facility design, and materials. The request may also include changes in the jobs created, project financing, the Applicant, the location, or other matters that demonstrate substantial change in the project’s scope. The request shall be accompanied by the appropriate fee.

(b) If a request does not include information needed to demonstrate substantive compliance with the provisions of ORS 285C.540 to 285C.559 and any applicable rules or standards adopted by the Director shall provide the Applicant a written notice relating to the information needed to make the request complete. If the Applicant does not provide all of the requested information to the Department within 30 days, the request shall expire and no changes shall be made to the preliminary certificate.

(c) After the Applicant files the change request, the Department shall decide if the facility as modified complies with ORS 285C.540 to 285C.559 and these rules.

(A) If it complies, the Director may issue an amended preliminary certificate which may contain new or amended criteria, conditions and requirements.

(B) If it does not comply, the Director shall issue an order that denies the change and provide written reasons for the denial.

(10) Director’s Amendment or Revocation of a Preliminary Certificate. The Director may issue an order altering, conditioning, suspending or denying preliminary certification if the Director determines that:

(a) The erection, construction, installation or acquisition does not comply with the provisions of ORS 285C.540 to 285C.559 and applicable rules and standards; or

(b) The Applicant has previously received preliminary or final certification for the same costs; or

(c) The Applicant is unable to demonstrate that the facility would be economically viable without the allowance of additional credits under ORS 315.341; or

(d) The Applicant was directly involved in an act for which the Director has levied civil penalties or revoked, canceled or suspended any certification under ORS 285C.540 to 285C.559; or

(e) The Applicant or the principal, director, officer, owner, majority shareholder or member of the Applicant, or the manager of the Applicant if the Applicant is a limited liability company, is in arrears for payments owed to any government agency while in any capacity with direct or indirect control over a business; or

(f) The facility undergoes changes without the changes being approved under these rules;

(g) Any other reason allowed by the amendments to ORS 285C.551(3) in Oregon Laws, 2011, Chapter 474, Section 11.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0130 Final Certification

(1) Facility Completion. To qualify for a final certificate, the facility shall be completed as described in the preliminary certificate, and in accordance with the performance agreement and these rules. Any changes to the preliminary certificate and/or application for preliminary certification shall be made through the amendment process outlined in these rules and shall be completed prior to the project completion date. Failure to obtain approval through the amendment process may result in denial of the application for final certification.

(2) Application and Review.

(a) Applicants with completed facilities must have a valid preliminary certificate for a Manufacturing BETC in accordance with ORS 285C.547(5) in order to complete final certification including all transactions associated with the pass-through option described in 123-600-0135.

(b) The application shall be considered received for the purposes of ORS 285C.557 on the date marked received by the Department, unless the application is incomplete. If the application for final certification is not complete, the date marked received by the Department on the complete application containing all of the required information shall be considered the received date.

(c) Review of the application for final certification shall include a determination by the Director that the proposed erection, construction, installation or acquisition is technically feasible and should operate in accordance with the representations made by the Applicant, and is in accordance with the provisions of ORS 285C.540 to 285C.559 and any applicable rules or standards adopted by the Director, including but not limited to:

(A) Evidence in a form acceptable to the Department that the conditions of the preliminary certification and performance agreement have been complied with;

(B) Evidence of the costs of the facility. If the actual cost of the facility is less than $50,000, copies of receipts for purchase and installation of the facility; or if the actual cost of the facility is $50,000 or more, certified to by a certified public accountant who is not an employee of the Applicant. The certified public accountant shall:

(i) Complete a written review of costs paid or incurred to be reported in the Final Application, related to the facility as described in the Preliminary Application and Preliminary Certificate, based on canceled checks, invoices, or receipts, a binding contract or agreement, or other documentation as may be required under these rules and certify that such costs were properly paid or incurred and represent eligible costs under these rules indicating exceptions as applicable.

(ii) Conduct the review in the form of an agreed-upon procedures engagement that is in accordance with AT Section 201, Agreed-Upon Procedure Engagements (Statements on Standards for Attestation Engagements 10, as amended) of the American Institute of Certified Public Accountants.

(iii) Conduct any sampling of costs in accordance with procedures in the Statement on Auditing Standards in the AICPA Guidelines.

(iv) Review sufficient information if an applicant has an outstanding binding contract or loan agreement, to become satisfied that accounts directly related to the facility are not in default in order to include such costs as eligible costs.

(C) The amount of the credit under ORS 315.341 that is to be claimed and that the costs have not previously received preliminary or final certification;

(D) Information sufficient to demonstrate the number and type of jobs created and maintained by the operation and maintenance of the facility over the five-year period beginning with the year of preliminary certification under ORS 285C.551 and information on the benefits of the facility with regard to overall economic activity in this state will be met;

(E) Information sufficient to demonstrate that the facility shall remain in operation for at least five years, unless the Director by rule specifies a shorter period of operation;

(F) Documentation of compliance with applicable state and local laws and regulations and licensing and permitting requirements as defined by the Department; and

(G) A statement that the Applicant or the principal, director, officer, owner, majority shareholder or member of the Applicant, or the manager of the Applicant if the Applicant is a limited liability company, is not in arrears for payments owed to any government agency while in any capacity with direct or indirect control over a business.

(H) Any other information determined by the Department to be necessary prior to issuance of a final certificate, including inspection of the facility by the Department.

(b) After an application for final certification is received, the Department shall determine whether the application is complete. An application is incomplete if it does not include information needed to demonstrate substantive compliance with the provisions of ORS 285C.540 to 285C.559 and any applicable rules or standards and preliminary certification conditions adopted by the Director. If it is not complete, the Applicant shall be provided a written explanation describing deficiencies. If it is complete, the Department shall process the application. Within 60 days after a completed application for final certification is received the Department shall either approve or deny the application.

(c) If the Department approves the application; the Director shall issue a certified amount letter, which shall state the amount of certified costs, reduced as applicable by any federal grants received, and the amount of the tax credit approved. The certified amount letter may contain additional criteria and conditions that shall be met in order to retain tax credit benefits or the tax credit certificate issued to the Applicant may be subject to revocation. If the facility fails to meet any of the criteria, conditions and requirements established in final certification, the Applicant shall notify the Department within 30 days.

(d) When an Applicant chooses to transfer the tax credit under ORS 285C.549, the Department may hold the application for final certification until pass-through partner(s) information is received by the Department.

(3) Final Certificate. A certificate issued under ORS 285C.553 is required for purposes of obtaining tax credits in accordance with ORS 315.341. Such certification shall be granted for a period not to exceed five years. Unless transferred to a pass-through partner under ORS 285C.549, 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 285C.553 is received by the Department.

(a) If the original owner of the certificate uses any portion of the credit, the certificate becomes nontransferable.

(b) After the Director issues a final certificate, an Applicant shall notify the Department in writing within 30 days of any of the following conditions:

(A) The facility has been moved;

(B) Title to the facility has been conveyed;

(D) The facility is not operating; or

(E) The term of a leased facility has ended.

(4)(a) Basis for Denying Tax Credit Benefits. The Department may deny final certification if any of the following conditions exist:

(A) Final certification is not complete before 1,825 days (5 years) after the preliminary certificate was issued.

(B) The Applicant does not provide information about the facility in a reasonable time after the Department requests it;

(D) The Applicant misrepresents or fails to construct or operate the facility;

(E) The Applicant fails to demonstrate that the facility described in the application is separate and distinct from previous or current applications reviewed by the Department;

(F) The facility does not meet all of the conditions and requirements contained in the preliminary certificate or performance agreement; or

(G) The Applicant is unable to demonstrate that the facility complies with all applicable provisions of ORS Chapter 285C.540 to 285C.559 and these rules.

(b) If the Department does not approve the application, the Department shall provide written notice of the action, including a statement of the findings and reasons for the denial by regular and certified mail.

(c) An application for final certification that is denied can be submitted again. An application for final certification can be amended or withdrawn by the Applicant. If an application is submitted again or amended, the time for review of the application for final certification starts over.

(d) If the Director does not issue a certified amount letter for final certified cost or a final certificate within 60 days after an application is filed, the application is denied pursuant to ORS 285C.553 (4).

(5)(a) Basis for Revoking Tax Credit Benefits. The Director shall revoke certificates as provided in ORS 285C.559 and 315.341 (4)(a) if the Director finds that:

(A) The certification was obtained by fraud or misrepresentation. For the purposes of this section, “fraud or misrepresentation” means any misrepresentation made by an Applicant for a preliminary or final certification, including but not limited to, misrepresentations as to the Applicant’s financial viability, facility construction and operation, or any other information provided as part of an application for a preliminary or final certification;

(B) The holder of the certificate or the operator of the facility has failed to construct or operate the facility in compliance with the plans, specifications and procedures in the certificate or the performance agreement; or

(b) If all or a part of the tax credit certificate has been transferred to a pass-through partner under ORS 285C.549, the certificate is not considered revoked as to the pass-through partner, but the Applicant is liable for the amount of tax credits claimed or that could be claimed.

(6)(a) Sale or Disposition of the Facility After Final Certification. Pursuant to ORS 315.341(4)(a), upon receiving notice that the facility has been sold or otherwise transferred, the Director shall revoke the final certificate, as of the date of the disposition of the facility, unless the Manufacturing BETC for the facility has already been transferred under ORS 285C.549.

(b) The new owner or new or renewed lessee of a facility may apply for a final certificate. The request shall comply with ORS 285C.540 through 285C.559 and these rules and include information to allow the Department to determine the amount of tax credit not claimed by the former owner or former lessee. If the facility continues to comply with the requirements set out in these rules and any applicable conditions imposed by the Department, the Director shall issue a new final certificate consistent with the provisions of ORS 315.341 (4)(a).

(7) Request for Reconsideration. No later than 60 days after the Director issues an order on preliminary certification, final certification, or canceling or revoking a preliminary or final certificate under these rules, the Applicant may request reconsideration in writing.

(8) Inspections. After an application is filed under ORS 285C.547 or 285C.553 or a tax credit is claimed under these rules, the Department may inspect the facility. The Department shall schedule the inspection during normal working hours, following reasonable notice to the facility operator.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0135 Pass-through Transfer of the Tax Credit

For purposes of ORS 285C.549 and the pass-through rate for discounting the face value of a certified Business Energy Tax Credit to the Net Present Value that is the minimum amount the Applicant shall receive as a cash payment from the Pass-through Partner(s) in exchange for the Credit:

(1) Rate Formula. As set forth by the Department on the first business day of each calendar quarter, the pass-through rate, to be multiplied by the credit amount, equals “1 ÷ (1 + R + S + P)^5,” where:

(a) “R” is the U.S. Prime Rate as published by The Wall Street Journal newspaper;

(b) “S” is a spread factor greater than zero to account for special transactional and risk elements, and initially set at 3.25 percentage points, but subject to adjustment by the Department based on experience and changing circumstances;

(c) “P” is an estimate of projected price inflation, as determined by the Department, but to be not less than the average of the lower central tendency for core price inflation in the succeeding two years from the latest economic projections of the Federal Reserve Board members and Federal Reserve Bank presidents; and

(d) “5” means to exponentially raise the preceding sum to the fifth power in accordance with the five years over which the credit may be claimed.

(2) Modification of Formula. In addition to modifications of the variables “R” and “S” in subsection (1)(a) of this rule, the Department may alter the formula for purposes of this rule, as announced at the start of the calendar quarter, in response to any greatly changing situation with prevailing market rates of return or projected price inflation, potentially pending a temporary or permanent rulemaking.

(3) Rate Option. The Applicant may elect to use the quarterly pass-through rate as set in section (1) of this rule for the calendar quarter, during which occurs either:

(a) Preliminary Certification, or

(b) Transaction of the pass-through payment.

(4) For the Department to issue a tax credit certificate to a pass through partner the Applicant must be in compliance with the conditions and requirements of the Preliminary Certificate, the performance agreement and these rules.

(5) A tax credit may be transferred one time only, from the Applicant to an eligible pass through partner.

(6) Finding Pass-through Partners. The Applicant is responsible for seeking a pass-through partner. The Department cannot guarantee a pass-through partner for any completed project.

(a) The Applicant will notify the Department if a third-party intermediary will be used to assist the Applicant in seeking a pass-through partner.

(b) The Applicant will notify the Department when a pass-through partner(s) is identified. The Department will provide the necessary instructions and forms needed to complete verification of the pass-through payment transaction in order to issue a tax credit certificate.

(7) Transferee’s Certification Period. For a transferee holding a credit that has been transferred under ORS 285C.549, the five-year period begins with the tax year of the transferee in which the transferee pays for the credit.

(8) Expiration of Transferability. The Director may issue a final certificate in the name of the Applicant for any tax credit balance remaining sixty days prior to the expiration of the Preliminary Certificate under ORS 285C.547(5).

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0140 Budget Limits and Payments

(1) Amount of Credits Allowed for a Facility. During any calendar year, a Manufacturing BETC preliminary certificate shall not be issued for more than:

(a) $40 million in maximum eligible facility costs for a renewable energy resource equipment facility, not including those used to manufacture electric vehicles;

(b) $2.5 million in maximum eligible facility costs for a facility used to manufacture electric vehicles;

(2) Fees for Certification. The Department has established the following schedule for payments to accompany an application as required under 285C.555.

(a) Included with each application for preliminary certification shall be an initial payment payable to the Department. The payment is 0.0060 multiplied by the facility eligible cost and not to exceed a payment amount of $75,000, and subject to additional expenses incurred by the Department as described in this section.

(A) A refund shall not be granted for any reduced eligible costs that are included in an amended certificate.

(B) An additional application payment shall be paid as specified in (3)(a) of this rule if a request to amend a certificate to increase the eligible cost.

(b) Applications for preliminary certification shall not be reviewed or considered complete if not accompanied by the fee payment. Preliminary certificates shall only be issued if the application is complete. In addition, the Applicant may be required to pay for expenses incurred by the Department in connection with the application that exceed these payments and which the Department determines are incurred in connection with processing the application. The Applicant shall be advised of any additional application expenses the Applicant shall pay before the expenses are incurred by the Department.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0150 Prioritization System for Manufacturing BETC Facilities

Applications in Excess of Biennial Limits. In the event that the Department receives applications for preliminary certification with a total amount of potential tax credits in excess of the limitations in ORS 285C.545, the Department shall allocate the potential tax credits according to the order in which the applications are complete.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-600-0250 Research, Development, or Demonstration Facility (RDD)

(1) Criteria. Eligible RDD facilities shall comply with one or more of the following criteria:

(a) Research facilities that include a test bench research, prototype or pilot scale construction of a theoretically proved or primary researched new renewable resource generating or conservation technology;

(b) Development facilities that include the manufacture or initiation of the capability to manufacture new products for renewable resource generating or energy conservation in Oregon;

(c) Demonstration facilities that are likely to resolve questions on how to apply new renewable resource generating or more efficient energy technologies through pilot or production scale applications of technology; and

(d) Facilities that are likely to achieve Department’s goals as determined by the Director and shall demonstrate a reasonable potential to result in benefits in Oregon for which the value is likely to exceed the value of the tax credit, based on information filed with the application for preliminary certification.

(2) Eligible costs. Eligible costs for a RDD facility may include:

(a) Engineering, design and administrative costs

(b) Costs inherent in a research, development or demonstration facility that may not result directly in saved or produced energy. Such costs may include:

(A) Facility design, monitoring, assessment, evaluation and reporting. This includes but is not limited to: the development of standards, specifications, policies and procedures facilitating technology transfer; instruments, and controls.

(B) Other equipment needed to monitor, assess or evaluate the facility and the impacts of the facility.

(A) Materials for the demonstration model(s).

(B) The manufacturing, construction, assembly, and/or installation of the demonstration model(s).

(d) Other eligible costs as determined by the Director.

History

Statutory/Other Authority: ORS 285C.540 - 285C.559, ORS 315.341, OL 2011 & Ch. 474 HB2523
Statutes/Other Implemented: ORS 285C.540-559, 315.341, OL 2011, Ch. 474 HB2523, OL 2012 & Ch. 45 HB 4079
OBDD 8-2012, f. & cert. ef. 6-1-12

Division 623 STRATEGIC INVESTMENT PROGRAM

Or. Admin. R. 123-623-1000 GENERALLY FOR SIP PROJECTS — Purpose and Scope

This division of administrative rules clarifies, specifies and establishes procedures, standards and criteria for operation of the Strategic Investment Program (SIP) under ORS 285C.600 to 285C.635 and 307.123. It does not control or bind the county assessor or Department of Revenue and is superseded by OAR chapter 150 in matters related to tax administration.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600 – 285C.635 & 307.123
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1000 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0201
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-1100 Definitions

For the purposes of this division of administrative rules definitions are found in OAR 123-001 (Procedural Rules). Additionally, as used in these rules, the following terms have the meanings set forth below, unless the context demands otherwise.

(1) Abatement means the taxation and assessment of property comprising an eligible project under ORS 307.123 (see OAR 150-307-0100).

(2) Applicant means a business firm, including but not limited to a privately or publicly held corporation, for-profit company, people’s utility district, or a joint operating agency under ORS 262.005, seeking approval from the Commission for Abatement.

(3) Application means the Department-prescribed form described in OAR 123-623-1400, which is available at and submitted to: Incentives, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301-1280, see www.oregon.gov/biz, as well as all supplemental attachments, exhibits and so forth that the Applicant completes or furnishes to the Department for the Strategic Investment Program.

(4) Approved Project means an investment or investments in taxable property that:

(a) Is not Existing Property;

(b) The Applicant owns or leases;

(d) Conforms to the project definition established with the determination of the Commission according to OAR 123-623-1700.

(5) County means the government of the county in which the Approved Project is located. (“County” instead refers to the Tribe/tribal government, if the Approved Project is anywhere on the reservation of a federally recognized Indian Tribe)

(6) CPI-U/W means the latest release by the U.S. Bureau of Labor Statistics of all monthly (not seasonally adjusted) price levels covering all items over an entire year for the “Consumer Price Index for All Urban Consumers, West Region,” as used in ORS 285C.600(2).

(7) Existing Property means any property, including but not limited to portions or incremental units of property, that:

(a) Comprises all or part of a prior Approved Project (unless the property was never actually subject to Abatement).

(b) At the time of the Department’s receipt of the Application, is already:

(A) Owned or leased by the Applicant regardless of location, including but not limited to previously acquired land or other property at the Approved Project’s site;

(B) Physically in the process construction, reconstruction, improvement, modification or installation; or

(C) Located in an SIZ if the SIZ is the basis of Abatement pursuant to ORS 285C.606(3) and 285C.626, irrespective that the property is subsequently modified, refurbished, remodeled, renovated, retrofitted or upgraded consistent with OAR 123-623-1700(3).

(8) Retained Jobs means the Total Jobs that existed some time before the Approved Project became fully operational, or that are associated with later, intra-firm transfer of operations within this state, according to OAR 123-623-4200.

(9) SIZ means any of three existing strategic investment zones designated by the Commission at the request of the County pursuant to an agreement by sponsoring governments under ORS 285C.623(4) before September 24, 2023.

(10) Total Cost means the cumulative amount spent on real and personal property comprising the Approved Project and subject to the Abatement, adjusting only for property taken out of service (retired) or removed from the project’s location(s).

(11) Total Jobs means the total number of hours, for which relevant jobs, employees or hires were paid over a year’s time, divided by 2,080, consistent with OAR 123-623-4200.

(12) Urban Project means an Approved Project located entirely outside a “rural area” as defined under ORS 285C.600, and hence, at least partially inside the urban growth boundary—as acknowledged and in effect on the date of the Department’s receipt of the Application—of:

(a) The Portland metropolitan region, aside from the exceptions in OAR 123-632-1115; or

(b) Any city outside that region, for which the population equals or exceeds 40,000 based on the most recent decennial U.S. Census count (which currently consists of Albany, Bend, Corvallis, Eugene, Medford, Salem–Keizer and Springfield).

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600 – 285C.635 & 307.123
OBDD 23-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 18-2023, minor correction filed 08/24/2023, effective 08/24/2023
OBDD 17-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1100 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
Reverted to EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0351
EDD 3-2006(Temp), f. & cert. ef. 5-26-06 thru 11-22-06
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0351
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-1115 Specially Preserved Rural Areas

On and after October 5, 2015, the following remain rural areas under ORS 285C.600 pursuant to section 2, chapter 518, Oregon Laws 2015:

(1) Any area inside Clackamas Rural SIZ #1, designated September 24, 2010, and sponsored by Clackamas County and the cities of Canby, Estacada, Happy Valley, Molalla and Sandy; and

(2) Tax lot 2900 in the southeast quarter of section 21 of Township 1 North, Range 2 West of the Willamette Meridian (1N221-2900) in Washington County.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600 & OrLaws 2015 ch. 518 §2
OBDD 17-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16

Or. Admin. R. 123-623-1250 Eligibility Criteria of the Commission

Under the definition of “eligible project” as used in ORS 285C.600:

(1) The Commission may establish criteria in order for property to receive Abatement either by resolution or as described in this division of administrative rules.

(2) The Commission may reject or revoke an Application up to 18 months after its approval and before the Abatement has begun, if the Approved Project will or does take place in conjunction with what the Commission deems to be substantial curtailment of employment at operations under the control of the Applicant (including but not limited to another commonly controlled business firm) anywhere in this state. Mitigating factors include:

(a) Applicant’s candidness and cooperation in addressing such conjunction;

(b) Such curtailment’s being unrelated and only coincidental to proposed investments; or

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600 & 285C.606
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1250 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-1300 Local Hiring

For purposes of ORS 285C.603:

(1) Prospective Applicants and County/local governments are encouraged to consider creative and cooperative means to promote gainful work for persons already residing in the proximate area or region of the Approved Project for:

(a) Jobs associated with the Approved Project’s facility or operations; and

(b) Persons employed in the construction or installation of property or by other types of associated contractors, vendors or suppliers.

(2) The means to achieve section (1) of this rule shall not create any:

(a) Undue burden on the Applicant relative to the nature, needs or competitiveness of the Approved Project; or

(b) Explicit bias against anyone’s rights or access to the privilege of employment, such as specifying residency-based hiring criteria proscribed by OP-8236, Oregon Attorney General (April 20, 1995).

(3) The job fair in OAR 123-623-1500(2)(c)(E) is expected to take place:

(a) In the vicinity of the project and in relation to this rule and the First Source Hiring Agreement, although the announcement may also be statewide.

(b) Only after the local agreement in OAR 123-623-1525(1) or 123-623-1550(2), either:

(A) In conjunction with the business firm’s main drive to recruit employees and to fill open positions at the Approved Project in anticipation of commencing new operations; or

(B) Directly prior to commencing new operations in the absence of significant job openings.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.603, 285C.606, 285C.609 & 285C.623
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1300 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04

Or. Admin. R. 123-623-1400 Making Application

(1) An Applicant seeking the Commission’s determination of an eligible project for Abatement must submit an Application to the Department.

(2) In addition to what is required by the Application or in this division of administrative rules, the Applicant shall submit any information requested by the Department for purposes of evaluating the Application.

(3) Not less than 21 days after having received a complete Application, as described in OAR 123-623-1500, the Department shall arrange for the Commission to initially consider it at a regular or special meeting. Under extenuating circumstances, the Department may dispense with this minimum period.

(4) The Application form is available from and submitted to: Incentives – Economic Development, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301, see www.oregon.gov/biz.

(5) An Applicant may submit an Application that is incomplete for lack of local agreement/approval, which the Department effectively receives and holds pending completion, in order that subsequently acquired, constructed or installed property avoids classification as Existing Property or for other reasons, so long as the Application includes:

(a) The fee described in OAR 123-623-1800(1);

(b) All required information or documentation currently available to the Applicant; and

(c) What the Department deems to be sufficient evidence that the Applicant has been in contact with the County to initiate steps under ORS 285C.609, including but not limited to local submission of a formal application if the County has previously established such procedures.

(6) Section (5) of this rule is not applicable to proposed investments using an SIZ. All local processing and approval of such a project must be completed before submission of an Application.

(7) No later than 30 days after the County has approved the project, the Applicant and County shall ensure that the Department is in receipt of a complete Application with all of the pertinent materials or evidence described in this rule and OAR 123-623-1500 or 123-623-1550.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.606 & 285C.626
OBDD 24-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1400 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0401
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-1500 Contents of Application, Generally

The Application must include:

(1) A copy of a First Source Hiring Agreement according to OAR 123-070 that takes effect beginning no later than when any hiring for the Approved Project commences and ending no sooner than June 30 of the final tax year of Abatement.

(2) Information required in the Application form, including but not limited to full company identification, nature of proposed operations, hiring/payroll projections, proposed investment(s), status of local approval, and any exceptional impact on public services, as well as:

(a) The number of Retained Jobs over the 12 months preceding the Department’s receipt of the Application at the site, facility or operations, to which the proposed investment will be made;

(b) Full disclosure for purposes of OAR 123-623-1250, including but not limited to any probable reduction in the operations, employment or the like at any other facility in this state that is owned or operated by the Applicant or a commonly controlled business firm, within one year after making application, regardless of proximity or relationship to the proposed investment(s); and

(A) Address the exhortation under ORS 285C.603 consistent with OAR 123-623-1300;

(B) Provide timely notification or evidence to the county assessor or the Department of Revenue, as requested or otherwise necessary under ORS 307.123 or other applicable laws, such as the date when any taxable property is or will be initially occupied, used or operated commercially for specifically intended purposes;

(C) Ensure that any ultimate lessee is responsible for the payment of property taxes levied on leased property that comprises any part of the Approved Project;

(D) Submit the annual reports of employment required under ORS 285C.615 and described in OAR 123-623-4000 to 123-623-4200; and

(E) Hold a job fair under ORS 285C.606(6)(b) duly announced through Worksource Oregon of the Oregon Employment Department and consistent with OAR 123-623-1300(3).

(3) As described in OAR 123-623-1800:

(a) Full amount of the nonrefundable application fee; and

(b) Commitment to pay additional fee, if approved.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.603, 285C.606 & 285C.626
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1500 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04

Or. Admin. R. 123-623-1525 Application within a Strategic Investment Zone

If the proposed investment is subject to approval based on its location inside an SIZ:

(1) A complete Application must also include a locally endorsed and fully executed copy of the SIZ’s standardized agreement that unambiguously identifies the Applicant and the proposed investment.

(2) The County may neither negotiate a project-specific agreement nor subject the proposal to approval under discretionary provisions, including but not limited to those under ORS 285C.609.

(3) Material variance between additional requirements established with designation of the SIZ and those found in the agreement submitted by the Applicant shall render such requirements unenforceable.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600, 285C.606 & 285C.626
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1525 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-1550 Application outside a Strategic Investment Zone

A complete Application must also include all of the following, if the proposed investment is not using an SIZ:

(1) Evidence that the County held a public hearing concerning the Applicant’s proposal, before executing the agreement in section (2) of this rule.

(2) A copy of the agreement:

(a) Entered into between the Applicant and the County with respect to a proposed project, and including any:

(A) City in which project property is located anywhere within its corporate limits; or

(B) Port in which project property is located anywhere within the jurisdiction of the port district (for an agreement entered into on or after September 24, 2023);

(b) Executed before the official action in section (3) of this rule;

(d) Specifying requirements, if any, under ORS 285C.609(6).

(3) With respect to official action by the governing body of the County:

(a) A copy of the official action, which does not, as such, need to request the Commission’s determination so much as effectively approve the proposed project for Abatement or authorize the agreement; and

(b) Evidence of an affirmative vote by a majority of the body’s members (not merely those present) at a regular or duly called special meeting that effected the action.

(4) The latest version of any document provided by the Applicant to the County/local governments in relation to sections (1) to (3) of this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.606 & 285C.609
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
Renumbered from 123-023-1550 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-1600 Consideration and Approval

(1)(a) The Department shall review each Application; and

(b) Only after deeming that information in OAR 123-623-1500 and 123-623-1525 or 123-623-1550 is completely and accurately provided (except potentially for pending materials or information, of which the Department is reasonably assured of receipt), shall the Department make a recommendation to the Commission (subject to actual receipt of any pending material or information).

(2) In evaluating an Application, the Commission shall hold at least one meeting open to the public, at which the matter is an agenda item for discussion, and for which the Department has made appropriate and customary public notice. At the meeting, the Commission may:

(a) Invite oral statements or written comments from the public; and

(b) Have the Applicant appear in order to give a statement and to answer questions of Department staff or members of the Commission, exclusively.

(3) The Commission may dispense with some or all of the elements in section (2) of this rule, as otherwise permitted under ORS Chapter 192, in light of extenuating circumstances.

(4) Pursuant to evaluation of the Application, the Applicant’s proposed investment(s) are determined to be an eligible project for Abatement if the Commission finds that:

(a) The project will satisfy the criteria for eligibility as established by prior resolution of the Commission or in this division of administrative rules;

(b) The project will directly benefit a traded sector industry;

(c) The Total Cost of investments in property comprising the proposed project will equal or exceed the minimum amount described in section (5) of this rule by the time that the Abatement would begin;

(d) The project will not consist of any property formerly or currently exempt under ORS 285C.175 and the Applicant is not an authorized business firm for any investment at the exact same location in an enterprise zone, unless there will be a demarcation between such qualified property and property subject to the Abatement that is clear enough for proper valuation and tax administration;

(e) The Applicant is not subject to an outstanding suspension under ORS 285C.615(3), as described in OAR 123-623-4000(6), or under ORS 307.123(7); and

(f) The Applicant has agreed to comply with any additional reasonable conditions imposed by the Commission related to the Strategic Investment Program, including requirements that continue for the term of the Abatement.

(5) At a minimum, the expected Total Cost of a project under ORS 285C.606(1)(c) must be:

(a) For a Commission determination before the CPI-U/W for 2024 in 2025:

(A) $40 million; or

(B) $150 million in the case of an Urban Project.

(b) For later determinations, an amount that is:

(A) Evenly divisible by $100,000; and

(B) Closest to the product of the respective figure in paragraph (a)(A) or (B) of this section multiplied by the greater of one or one plus the percent change between the annual average of:

(i) The CPI-U/W for 2023; and

(ii) The most recently available CPI-U/W.

(6) Notwithstanding suspension of the determination as provided under ORS 285C.615(3) and 307.123(7), once the Commission has taken formal action to authorize the Abatement, the Commission’s determination is final, and the Commission may reverse, rescind or withdraw it only by formal finding of a material error or omission among submitted Application information or a noncompliance with criteria described or referenced in this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600 – 285C.635 & 307.123
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1600 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0451
Reverted to EDD 7-1999, f. & cert. ef. 9-30-99
EDD 12-2002(Temp), f. & cert. ef. 6-5-02 thru 11-29-02
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-1700 Establishment of Exempt Property

(1) The Commission’s determination pursuant to OAR 123-623-1600 needs to define the Approved Project for purposes of the Abatement, consistent with the Application and the agreement between the Applicant and local government(s).

(2) Such a definition shall employ one or more of the following examples or a comparable method that:

(a) Stipulates the site(s) or overall facility at which applicable property must be located, used and occupied for commercial purposes;

(b) Delimits what the Abatement covers in terms of total investment cost or property value, or the specific period, in which construction/installation needs to commence, or in which property must be placed in service; or

(c) Identifies applicable real and personal property, including but not limited to portions or incremental units of property, by:

(A) Referencing or incorporating the description of investment(s) in the Application or further information from the Applicant (whether requested or not by the Department or Commission);

(B) Delineating improvements or property items (or representative examples thereof) that the Applicant will acquire, construct or install, or for which the assessed value would increase as a result of additions, reconstruction, modifications, refurbishment, remodeling, renovation, retrofitting or upgrades; or

(C) Specifying improvements or property items that are not part of the Approved Project subject to Abatement, including but not limited to Existing Property.

(3) The Abatement may include an increase in the assessed value of Existing Property that results, as part of the Approved Project, from:

(a) A new addition to or comprehensive reconstruction of an existing building or structure, whether inside an SIZ or not.

(b) Modification, remodeling, refurbishment, renovation, retrofitting or upgrade of any Existing Property, except inside any SIZ where only newly constructed or newly installed property qualifies for Abatement.

(4) As otherwise allowed under the project definition described in this rule, the Abatement shall cover any property comprising the Approved Project, for which construction, installation, modification or the like occurs during or after the first year of Abatement, but only for the remainder of the 15-year period.

(5) If another business firm acquires the Applicant or the Approved Project, the ongoing Abatement shall continue as authorized, such that continuously exempt property is not Existing Property, provided that:

(a) The acquiring firm complies with all terms and conditions under the Application, its approval, and the corresponding local agreement in OAR 123-623-1525 or 123-623-1550, as well as applicable requirements of law and this division of administrative rules, as if the acquiring firm were the Applicant; and

(b) The owner or chief executive officer of the acquiring firm furnishes and authorizes a formal statement to the Department and the parties to the agreement, attesting to the firm’s full assumption of relevant obligations and requirements formerly incumbent on the Applicant.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.600, 285C.606, 285C.626 & 307.123
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1700 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04

Or. Admin. R. 123-623-1800 State Application and Approval Fees

With respect to ORS 285C.612 and the fees payable to and collected by the Department:

(1) The following (non-refundable) amount must accompany the Application:

(a) $5,000; or

(b) $10,000 for a proposed Urban Project.

(2) After the Commission decides to approve the Application, but pending formal authorization as such through the Department, the Applicant must pay the following amount (of which the Department shall transfer 50 percent to the Department of Revenue to administer ORS 307.123):

(a) $10,000; or

(b) $50,000 for a proposed Urban Project.

(3) The Commission or Department will allocate payments collected and retained consistent with relevant provisions in OAR 123-009.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.612
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1800 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0501
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-1900 Community Service Fee

(1) The local agreement included with the Application and described in OAR 123-623-1525 or 123-623-1550 shall:

(a) Provide for the community service fee under ORS 285C.609(4)(b) and (c) or 285C.623(4)(b) and (c); and

(b) Stipulate the means by which the Applicant will annually pay the fee not earlier than December 1 of each tax year for which the Applicant receives the Abatement.

(2) The depositing of community service fee moneys (under ORS Chapter 294) or their allocation, distribution or transfer by the County or any other entity in OAR 123-623-1950(1) does not affect the Approved Project’s eligibility or receipt of the Abatement.

(3) The annual maximum of the community service fee is:

(a) $500,000, or $2 million with an Urban Project, for any Approved Project by determination of the Commission before October 6, 2017, or with an SIZ;

(b) $2.5 million, if the determination occurred on or after October 6, 2017, and the agreement was entered into before September 24, 2023; or

(A) $3 million, in tax year 2024–2025 of the Abatement.

(B) In any later tax year, an amount evenly divisible by $1,000 that is closest to the product of $3 million multiplied by the greater of one or one plus the percent change between the annual average of:

(i) The CPI-U/W for 2023; and

(ii) The most recently available CPI-U/W.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.609 & 285C.623
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-1900 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04

Or. Admin. R. 123-623-1950 Local Distribution of Community Service Fee

For purposes of annual payments to be received according to OAR 123-623-1900:

(1) The County shall distribute the entire annual community service fee to:

(a) The County;

(b) City government(s) if any part of Approved Project is located within incorporated territory;

(d) Any other local taxing district that levies taxes on property located in a tax code area containing any part of the Approved Project:

(A) Listed under ORS 198.010 or 198.180; or

(B) In addition to paragraph (A) of this subsection; or

(e) Local organizations or programs that provide a relevant and significant community service, even without taxing authority.

(2) A distribution formula shall determine the exact percentage of the community service fee received or retained by an entity listed in section (1) of this rule. A schedule of distribution formulae that varies from year to year is allowable.

(3) Establishment of the annual formula may occur in one of only two ways:

(a) By official action of the Commission, if subsection (b) of this section is not satisfied; or

(b) By a formal agreement that:

(A) Takes effect on or before the same date of the third month following the Commission’s determination of the Approved Project;

(B) Parties stipulated in OAR 123-623-1975 have effectively entered into, in writing, by that date; and

(C) Provides specifically and completely for annual distribution of funds consistent with sections (1) and (2) of this rule.

(4) If local parties in OAR 123-623-1975 timely reach and effect such an agreement:

(a) They may mutually amend or revise the agreement at a later time; and

(b) The County shall formally report the annual distribution formula to the Department, to:

(A) Confirm that the Commission need not establish such formula; and

(B) Inform about the redistribution of funds received under ORS 285C.635(3).

(5) In the event that the parties in OAR 123-623-1975 have not concluded an agreement (aside from outstanding signatures) before the requisite three-month period, the Commission:

(a) Shall take necessary steps as soon as reasonably possible for purposes of subsection (3)(a), as described in section (6), of this rule; or

(b) May delay official action, at its sole discretion, upon learning that a sufficient set of parties (as described in OAR 123-623-1975) is having productive negotiations, with which they wish to continue. Under such circumstances:

(A) The Commission may officially sanction an agreement reached when negotiations successfully conclude; and

(B) The parties may not subsequently amend or revise such an agreement in any way that would effectively modify the established distribution formula.

(6) In determining a distribution formula, the Commission:

(a) May rely primarily on the relative proportions of prevailing property tax rates among affected local taxing districts;

(b) May consider adjusting such proportions according to the Approved Project’s demand or direct impact on the public service(s) provided by each entity, taking account of expected new property tax revenues even with the Abatement, as well as consideration of the goals and purposes of applicable state policies;

(c) Shall set an annual distribution percentage for each entity described in section (1) of this rule that the Commission determines will receive a portion of the distribution; and

(d) Shall in the process of issuing the distribution formula to the County government, notify all entities of its official, final action.

(7) In an SIZ, each Approved Project will entail a separate agreement or Commission action for the distribution of the community service fee arising from it, consistent with this rule. Nevertheless, with respect to an SIZ, the County and other applicable local parties (including but not limited to the Port of Portland under ORS 778.010) may agree to a generalized distribution formula and standard agreement for all future Approved Projects.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.609, 285C.623 & 285C.635
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
OBDD 11-2012, f. & cert. ef. 8-15-12
Renumbered from 123-023-1950 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-1975 Mandatory Parties to Community Service Fee Agreement

An effective agreement under ORS 285C.609(7) or 285C.623(6) for purposes of OAR 123-623-1950 must include at least:

(1) The County government;

(2) Any city government described OAR 123-623-1950(1)(b);

(3) Any port described in OAR 123-623-1950(1)(c);

(4) Any local taxing district described in OAR 123-623-1950(1)(d), except if using an SIZ, that is:

(a) A health district organized under ORS 440.305, and that provides ambulance or other medical emergency response service;

(b) A rural fire protection district organized under ORS chapter 478;

(d) A county service district organized under ORS chapter 451 or other such special district that provides:

(A) Public safety services including but not limited to police or sheriff;

(B) Fire prevention or response services; or

(5) A sufficient number of local taxing districts described in OAR 123-623-1950(1)(d)(A)—i.e., those under ORS 198.010 and 198.180—to account for at least 75 percent of the total property tax rate authority of all such districts (except a port). In calculating the 75 percent:

(a) Property tax rate authority is each district’s permanent rate authority (plus its local option rate authority, if any), whether currently used or unused, but excluding any rate based on a true levy such as for bonded indebtedness.

(b) Property tax rate authorities may be prorated based on the anticipated proportion of the Approved Project to be located in respective tax code areas for an agreement encompassing districts in two or more tax code areas.

(c) Property tax rate authorities of districts participating in the agreement are added together and divided by the total of all such districts' property tax rate authorities, such that the numerator and denominator shall:

(A) Include every district otherwise required by section (4) of this rule that is also listed under ORS 198.010 or 198.180; and

(B) Exclude any port district in section (3) of this rule [as well as any city or county], even within an SIZ.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.609 & 285C.623
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-623-2000 Confidential Records

As provided under ORS 192.345, 192.355 and 285C.620:

(1) The Department shall not release any information identifying or pertaining to an expected Applicant, or to discussions among it, local governments, or the Department and members of the Commission, before:

(a) Finalization of local approval for the proposed investment based on its being inside an SIZ; or

(b) The County governing body issues a public notice for the public hearing under ORS 285C.609(4), if not using an SIZ.

(2) The Department shall not release any Application materials submitted by an expected Applicant that specifically describe investment plans, before the Department’s deems the received Application to be complete.

(3) The department shall seek to keep confidential certain sensitive records or communications obtained in association with an Application or OAR 123-623-4000 to 123-623-4200, as otherwise allowable under ORS 192.311 to 192.478, including but not limited to the following:

(a) Reports and analyses of reports bearing on the Applicant’s character, finances, management ability and reliability, as obtained in confidence from persons or firms not required by law to submit them, including but not limited to the Applicant, and for which the Department obliged itself in good faith to not disclose;

(b) Financial statements, tax returns, business records, employment history, personnel files and comparable data submitted by or for an Applicant, or analysis of such data;

(d) Formulas, plans, designs and related information that constitute trade secrets under ORS Chapter 192;

(e) Personal financial statements;

(f) Information of an Applicant pertaining to litigation that has not concluded, to which the Applicant is a party if the complaint has been filed, or if not, that the Applicant shows is reasonably likely to occur (Nothing in this section shall limit any right or opportunity granted by discovery or deposition statutes to a litigant or defendant);

(g) Production, sales or cost data, customer lists, or detailed descriptions or identifications of business property; or

(h) Marketing strategy information that relates to an Applicant’s plan to address specific markets and the Applicant’s strategy regarding specific competitors.

(4) Subject to sections (1), (2) and (3) of this rule, the Department shall provide records pertaining to the Strategic Investment Program upon written request, as described in OAR 123-005.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.615 & 285C.620
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-2000 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08
EDD 10-2004, f. & cert. ef. 5-24-04, Renumbered from 123-023-0551
EDD 7-1999, f. & cert. ef. 9-30-99

Or. Admin. R. 123-623-2500 Starting SIP Period and Taxable Bases of Assessment & Taxation

(1) Under ORS 307.123(2)(c) the initial tax year for a period of Abatement occurs when:

(a) The total real market value of property comprising the Approved Project, as of the tax year’s corresponding assessment date, exceeds the initial amount of the taxable portion according to section (4) or (5) of this rule; and

(b) On or before June 30 immediately preceding the tax year (even if after the assessment date):

(A) Property constituting the project has been exempted under ORS 307.330 for two years, regardless of paragraph (B) of this subsection; or

(B) In terms of primary commercial purposes consistent with specifically intended operations described in the Application, such property:

(i) Receives officially necessary but non-temporary certificate(s) of occupancy; or

(ii) Is being used or occupied or is fully ready for use or occupancy, including but not limited to producing finished goods or services, or intermediary outputs for the same, that are otherwise suitable and permissible for sale.

(2) Under ORS 307.123(2) and (3) for any tax year of an Abatement period, after it has begun:

(a) If the real market value of all project property, as of the tax year’s corresponding assessment date, is equal to or less than that year’s taxable portion amount according to section (4) or (5) of this rule, then all such property is subject to ad valorem taxes at its assessed value, for at least that year.

(b) Otherwise, only the assessed value of property comprising the taxable portion in section (3) of this rule is taxed, as the particular property would normally be taxable and have taxes levied on it.

(3) The county assessor shall assemble the taxable portion for each year of Abatement, by adding up particular property or portions of property that constitute the Approved Project—until their real market values as of the corresponding assessment date equal the respective amount in section (4) or (5) of this rule—in the following order:

(a) Any land acquired by the business firm;

(b) Any improvements to the land;

(d) New additions or modifications to a building or structure;

(e) Newly acquired or installed real property machinery and equipment; and

(f) Newly acquired or installed personal property.

(4) For purposes of any Approved Project in a rural area under ORS 307.123(2)(a)(B), the taxable portion amount is not adjusted by price indices, and it is:

(a) $25 million in the initial tax year of an Abatement by determination of the Commission before October 6, 2017, growing 3 percent per annum (compounded); or

(b) Otherwise based on Total Cost as of the corresponding assessment date for each tax year during the 15-year period of an Abatement, such that:

(A) In the initial tax year, the taxable portion equals the base amount respective to the threshold of Total Cost in section (6) of this rule;

(B) For each tax year over the remainder of the Abatement period:

(i) A significant increase or decrease in Total Cost will alter the respective base amount and cause the taxable portion to jump up or down accordingly; and

(ii) The taxable portion shall incorporate a 3-percent growth factor for each year of the period that has transpired—multiplying the respective base amount by 1.03 raised to the power of the Abatement year minus 1 (Example, base times 1.03⁴ in fifth year); and

(C) The Department will attempt to annually advise the applicable county assessor’s office of a project’s overall Total Cost, according to OAR 123-623-4100(2), as the county assessor or Department of Revenue may adjust according to property tax returns or other records.

(5) For purposes of any Urban Project under ORS 307.123(2)(a)(A):

(a) The amount of the taxable portion in the initial tax year of the Abatement is $100 million, except for subsection (b) of this section.

(b) If the Abatement begins in or after the 2026–2027 tax year, by determination of the Commission on or after September 24, 2023:

(A) The initial amount is a figure evenly divisible by $100,000 and closest to the product of $100 million multiplied by the greater of one or one plus the percent change between the December price level in:

(i) The CPI-U/W for 2024; and

(ii) The most recently available CPI-U/W.

(B) The Department will attempt to annually advise the Department of Revenue and county assessor’s offices of the applicable amount, as computed according to this subsection, for Urban Projects expected to begin in the upcoming tax year.

(c) For each tax year over the remainder of the Abatement period, pursuant to subsection (a) or (b) of this section, the taxable portion amount grows 3 percent per annum (compounded).

(6) The base amount in section (4) of this rule for the taxable portion of Abatement in a rural area, by determination of the Commission:

(a) On or after October 6, 2017, but before September 24, 2023, equals:

(A) $25 million if Total Cost is less than $500 million;

(B) $50 million if Total Cost equals or exceeds $500 million up to $1 billion; and

(b) On or after September 24, 2023, equals:

(A) $40 million if Total Cost is less than $500 million;

(B) $75 million if Total Cost equals or exceeds $500 million up to $1 billion; and

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 307.123
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-623-3000 LEGACY ZONES — Duration and Potentialities

(1) An existing SIZ does not expire and may be neither terminated nor geographically amended.

(2) In an SIZ the following occurrences do not affect any Approved Project for which the Department received the Application before:

(a) A city that does not sponsor the SIZ annexes territory inside of it; or

(b) A city, whose urban growth boundary (UGB) crosses the area of the SIZ, increases in population to 40,000 or more, based on the latest decennial U.S. Census count, in the case of an otherwise rural SIZ.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.623 & 285C.626
OBDD 51-2024, amend filed 11/22/2024, effective 11/22/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-3000 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-3400 Operational Changes to Existing Designations

(1) The sponsor of an existing SIZ may revise any of its documentation, procedures or policies, including but not limited to establishing a different standardized agreement, subject to communicating or submitting revisions to the Department.

(2) The Department may:

(a) Convey the revisions for consideration by the Commission, which may approve them if necessary and appropriate; or

(b) At its sole discretion, simply accept revisions, formally authorize them, or send the Commission a report of any such action, if deeming the revisions to be consistent with the original designation, and to be:

(A) Merely clarifying or enhancing administrative or technical matters;

(B) Changing a substantive criterion or requirement to only a relative degree; or

(3) Any such revision does not affect Abatement in the SIZ, for which the Department effectively received the Application on or before the effective date of any such change.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.623 & 285C.626
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
Renumbered from 123-023-3400 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-4000 ANNUAL PROJECT REPORTING — Submission to Department

For purposes of ORS 285C.615(1) to (3) & (6) and the report submitted by a business firm subject to Abatement in the property tax year concluding as of the prior June 30:

(1) The firm shall complete the prescribed report form available from and furnish it to: Incentives, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301, see www.oregon.gov/biz.

(2) The firm may send the report form on or after January 1 next following the tax year, but the Department must receive it no later than the immediately subsequent April-1 date or the preceding Friday when April 1 is a Saturday or Sunday.

(3) This reporting requirement applies to any Approved Project beginning with the tax year described in OAR 123-623-2500(1).

(4)(a) This rule applies regardless of any distribution under ORS 285C.635(3), or that the most recently concluded tax year is 2029–2030 or later, in that reports will still be required in and after 2031.

(b) Until such time, the Department will use reports to assist the Department of Administrative Services (DAS) in determining distribution amounts under ORS 285C.635, as addressed in OAR 125-180, insofar as distributions are applicable under section 6(2), chapter 905, Oregon Laws 2007.

(5) If the benefiting business firm has two or more Approved Projects receiving Abatements in a given tax year at more or less the same location(s), for which Total Jobs are the same or overlapping:

(a) The firm shall submit report forms for each project, including but not limited to the respective data for Retained Jobs as applicable according to OAR 123-623-4200(3) to (6).

(b) In transmitting data to DAS for purposes of subsection (4)(b) of this rule, the Department shall adjust the job numbers assigned among the projects to prevent double counting, which may depend on further information from the firm.

(A) For a less recent project assign to it the Retained Jobs reported for it;

(B) For any less recent project, assign the Retained Jobs reported for the next more recent project to be its total jobs, unless it is the least recent of three or more projects, in which case the number of total jobs is zero; and

(C) For the more recent project (if only two) or most recent project (if three or more), assign as its total jobs the reported Total Jobs (which would be the same for all projects) minus reported Retained Jobs, assigning zero as its number of retained jobs.

(6) The Department shall recommend to the Commission that it suspend its determination for the Approved Project, and any associated project for purposes of subsection (5) of this rule—effectively revoking any such Abatement for and after the tax year beginning with the very next July 1, until the suspension is ever rescinded under ORS 285C.615(3)(c)—if the benefiting firm has failed to:

(a) Provide information called for by the report form or in OAR 123-623-4100 or 123-623-4200; or

(b) Promptly satisfy a necessary or appropriate request by the Department to further clarify or verify such information. (Therefore, in light of the Department’s limited turnaround time to transmit data to DAS, firms are encouraged to submit as early as possible to improve the likelihood that such a request can be timely resolved)

(7) “Tax year” has the same meaning as under ORS 308.007.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.615, 285C.635 & OrLaws 2007 ch. 905 §6
OBDD 25-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 19-2023, minor correction filed 08/24/2023, effective 08/24/2023
OBDD 17-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-4000 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-4100 Reporting Elements

Respective or in addition to items stipulated under ORS 285C.615(2), the report submitted to the Department by a benefiting business firm described in OAR 123-623-4000 must:

(1) State for the applicable tax year, as may be confirmed or corrected through communication with the county assessor:

(a) The real market and assessed value of the entire Approved Project in terms of what was exempt or taxable, as well as corresponding property taxes saved or paid by the firm; and

(b) Which year it was out of the 15 that comprise the Abatement period.

(2) Include the Total Cost of investments physically made:

(a) In/during the calendar year directly preceding the report;

(b) In/during the calendar year immediately prior to the one in subsection (a) of this section; and

(c) Since commencement of the Approved Project up until and including the calendar year immediately prior to the one in subsection (b) of this section, which corresponds to investments affecting the property values in subsection (1)(a) of this rule.

(3) Breakdown the amounts and recipients of fees or other (non-tax) payments made by or on behalf of the firm that arise from requirements under ORS 285C.609(6) or 285C.623(5), in addition to the amount of the statutory community service fee, in the calendar year directly preceding the report.

(4) Provide data for Retained Jobs as relevant, Total Jobs, and taxable income and compensation of Total Jobs, in accordance with OAR 123-623-4200 that are broken out for:

(a) The firm itself; and

(b) A single general operator of the Approved Project, if relevant, but the report need not include information formally identifying any such general operator.

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.615
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 2-2016, f. & cert. ef. 1-29-16
Renumbered from 123-023-4100 by OBDD 18-2010, f. 4-30-10, cert. ef. 5-1-10
EDD 25-2008, f. 7-31-08, cert. ef. 8-1-08

Or. Admin. R. 123-623-4200 Applicable Employees and Payroll

For purposes of OAR 123-623-4100(4):

(1) With respect to Total Jobs, the report shall include each of the following totals for the preceding calendar year:

(a) Hours paid;

(b) Taxable income; and

(2) Relevant jobs, hires or employees are persons, regardless of residency in this state:

(a) For whom their employer under ORS chapter 316 is:

(A) The benefiting business firm (or a commonly controlled business firm); or

(B) A general operator, if any, who manages the entire Approved Project for the firm; but

(b) Who:

(A) Regularly work at a site or location containing property of the Approved Project; and

(B) Are engaged in or directly supporting business operations of the Approved Project, such that other operations represent not more than 25 percent of the person’s time spent performing work for the employer.

(3) Retained Jobs consist of relevant existing jobs, hires or employees described in section (2) of this rule, who:

(a) Were already at the existing site, facility or operations, to which the Applicant makes the investments that comprise the Approved Project, consistent with sections (4) or (5) of this rule; or

(b) Are associated with the transfer of operations from elsewhere in this state to the Approved Project, after the Application was received by the Department and before the final year of Abatement, that increase Total Jobs due to permanent curtailment of full-time equivalent employment at the former location of the transferred operations.

(4) Pursuant to an Application received by the Department on or after January 1, 2016, the first report shall establish total hours with respect to Retained Jobs already at the Approved Project over:

(a) The 12 months before the Application’s receipt, accounting for any modification from the Application in terms of OAR 123-623-1500(2)(a); or

(b) The calendar year ending 30 months before the first tax year of the Abatement if that is more recent than the period in subsection (a) of this section.

(5) In the case of Approved Projects, for which Applications were received before January 1, 2016, the Department shall seek to establish with the first such report in or after 2016, the applicable number of Retained Jobs based on information submitted and subject to adjustment by the firm in that or prior reports or upon request of the Department.

(6) Subject to section (4) or (5) of this rule, the number of Retained Jobs becomes fixed and need not be re-reported, but the benefiting business firm shall revise or update it with subsequent reports to:

(a) Correct errors and omissions, if any; or

(b) Account for operations of the firm (or a commonly controlled business firm) that are transferred during the preceding calendar year, in accordance with subsection (3)(b) of this rule, even if the operations became part of the firm through merger or acquisition after the Department received the Application.

(7) The number of hours assigned to salaried positions is 2,080, or a lower amount as prorated to account for less than full-time or year-round employment.

(8) Taxable income equates to the wages that the employer used in calculating amounts withheld under ORS chapter 316 for Oregon personal income taxes during the calendar year.

(9) Compensation includes total calendar-year remuneration (whether taxable or not) in the form of wages, salary, overtime pay, shift differential, profit-sharing, bonuses, commissions, paid vacation, and associated fringe or financial benefits such as life insurance, medical coverage and retirement plans, but excluding:

(a) Free meals, club membership or comparable workplace amenities;

(b) Payroll-based tax or cost mandated by federal, state or local law, such as worker’s compensation, unemployment insurance or the employer’s share under FICA; and

History

Statutory/Other Authority: ORS 285A.075 & 285C.615(7)
Statutes/Other Implemented: ORS 285C.615
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 2-2016, f. & cert. ef. 1-29-16

Division 630 OREGON LOW INCOME COMMUNITY JOBS INITIATIVE

Or. Admin. R. 123-630-0000 Purpose

This division of administrative rules specifies procedures and criteria necessary to administer processes under the Oregon Low Income Community Jobs Initiative for the certification of a qualified equity investment in order to receive a credit allowance for taxes otherwise due under ORS chapter 316, 317 or 318.

History

Statutory/Other Authority: ORS 285C.650 - 285C.656 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.650 - 285C.656 & 315.526 – 315.536
OBDD 8-2015, f. & cert. ef. 9-1-15
Reverted to OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 2-2015(Temp), f. & cert. ef. 2-12-15 thru 8-10-15
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0010 Definitions

For the purposes of this division of administrative rules, additional definitions are found in Procedural Rules, OAR chapter 123-001. As used in OAR chapter 123 division 630 the following terms have the meanings set forth below and in ORS 285C.650-285C.656 and ORS 315.526-315.536, unless the context clearly indicates otherwise.

(1) “Applicable percentage” means zero percent for each of the first two credit allowance dates, seven percent for the third credit allowance date and eight percent for the next four credit allowance dates.

(2) “Credit allowance date” means, with respect to any qualified equity investment:

(a) The date on which the investment is initially made; and

(b) Each of the six yearly anniversary dates after that initial date.

(3) “Long-term debt security” means any debt instrument issued by a qualified community development entity, at par value or at a premium, with an original maturity date of at least seven years from the date of its issuance, with no acceleration of repayment, amortization or prepayment features prior to its original maturity date.

(4) “Purchase price” means the amount of cash paid to a qualified community development entity for a qualified equity investment.

(5) “Qualified active low-income community business” has the meaning given that term in section 45D of the Internal Revenue Code and the rules and regulations adopted pursuant thereto. “Qualified active low-income community business” does not include, a business that derives or projects to derive 15 percent or more of its annual revenue from the rental or sale of real estate, unless the business is controlled by, or under common control with, another business that:

(a) Does not derive or project to derive 15 percent or more of its annual gross revenues from the rental or sale of real estate; and

(b) Is the primary tenant of real estate leased from the controlled business.

(6) “Qualified community development entity” has the meaning given that term in section 45D of the Internal Revenue Code, provided that the entity has entered into, or is controlled by an entity that has entered into, an allocation agreement with the Community Development Financial Institutions Fund of the United States Department of the Treasury with respect to credits authorized by section 45D of the Internal Revenue Code, and the State of Oregon is included within the service area set forth in the allocation agreement.

(7) “Qualified equity investment” means any equity investment in, or long-term debt security issued by, a qualified community development entity, that:

(a) Is acquired at its original issuance solely in exchange for cash after July 1, 2012, unless it was a qualified equity investment in the hands of a prior holder; and

(b) Within 12 months of its issuance substantially all of its cash purchase price is used by the issuer to make qualified low-income community investments in qualified active low-income community businesses located in this state and thereafter over the term of the qualified equity investment no less than 85 percent of its cash purchase price is used by the issuer to make qualified low-income community investments in qualified active low-income community businesses located in this state. All reinvestments must be made in this state.

(8) “Qualified low-income community investment” means any capital or equity investment in, or loan to, any qualified active low-income community business made after July 1, 2012.

History

Statutory/Other Authority: ORS 315.526 – 315.536
Statutes/Other Implemented: ORS 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0020 Credit Allowance

(1) A person or entity that makes a qualified equity investment shall, at the time of investment, earn a vested credit against the taxes otherwise due under ORS chapter 316, 317 or 318.

(2) The total amount of the tax credit available to a taxpayer under this section shall equal 39 percent of the purchase price of the qualified equity investment. The applicable percentage is zero percent for years 1 and 2, seven percent for year 3 and eight percent for years 4, 5, 6 and 7. A tax credit allowed under this section may not be sold or transferred, with the exception that tax credits that a partnership, limited liability company, S corporation or other pass-through entity is entitled to claim may be allocated to the partners, members or shareholders of the entity for their direct use in accordance with the provisions of any agreement among the partners, members or shareholders.

(3) The holder of a qualified equity investment or any partner, member or shareholder of such holder pursuant to subparagraph 2 above on a particular credit allowance date of the qualified equity investment may claim a portion of the tax credit against its tax liability for the tax year that includes the credit allowance date equal to the applicable percentage for that credit allowance date multiplied by the purchase price of the qualified equity investment.

(4) The credit allowed under this section may not exceed the tax liability of the taxpayer claiming the credit for the tax year in which the credit is claimed.

(5) For qualified low-income community investments made, any tax credit otherwise allowable under this section that is not used by the taxpayer in a particular tax year may be carried forward and offset against the taxpayer’s tax liability in any succeeding tax year. Any credit remaining in the next succeeding tax year may be carried forward and used in the second succeeding tax year. Any credit remaining unused in the second succeeding tax year may be carried forward and used in the third succeeding tax year. Any credit remaining unused in the third succeeding tax year may be carried forward and used in the fourth succeeding tax year. Any credit remaining unused in the fourth succeeding tax year may be carried forward and used in the fifth succeeding tax year, but may not be used in any tax year thereafter. For qualified low-income community investments made prior to January 1, 2014, any tax credit otherwise allowed under this section that is not used by the taxpayer in a particular tax year may be carried forward and offset against the taxpayer’s tax liability in any succeeding tax year.

History

Statutory/Other Authority: ORS 315.526 - 315.536
Statutes/Other Implemented: ORS 315.526 - 315.536, ORS 316 & 317 or 318
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0030 Eligibility

(1) The following conditions and/or criteria must exist for a taxpayer to be eligible for the credit:

(a) A qualified community development entity that issues a debt instrument may not make cash interest payments on the debt instrument during the period commencing with its issuance and ending on its final credit allowance date in excess of the sum of the cash interest payments and the cumulative operating income, as defined in the regulations promulgated under section 45D of the Internal Revenue Code, of the qualified community development entity for the same period. This limitation shall only apply to long-term debt securities issued by a qualified community development entity that are designated as qualified equity investments and shall not apply to other debt of the qualified community development entity. Neither this paragraph nor the definition of “long-term debt security” provided in ORS 315.529 in any way limits the holder’s ability to accelerate payments on the debt instrument in situations where the qualified community development entity has defaulted on covenants designed to ensure compliance with this section or section 45D of the Internal Revenue Code.

(b) A business is considered a qualified active low-income community business for the duration of a qualified community development entity’s investment in or loan to the business if it is reasonable to expect that at the time of the qualified community development entity’s investment in or loan to a qualified active low-income community business, the business will continue throughout the duration of the investment in or loan to the business.

(c) A qualified equity investment must be designated a qualified equity investment by the qualified community development entity and be certified by the department.

(d) Prior to January 1, 2014, the maximum amount of qualified low-income community investments made in a qualified active low-income community business, together with all of its affiliates, that may count towards the requirement that a qualified community development entity invest substantially all of the qualified equity investment required by OAR 123-630-0010(7)(b) in qualified active low-income community businesses in this state is $4 million, whether made by one or several qualified community development entities.

(e) On or after January 1, 2014, the maximum amount of qualified low-income community investments made in a qualified active low-income community business, together with all of its affiliates, that may count towards the requirement that a qualified community development entity invest at least the percentage of the qualified equity investment required by OAR 123-630-0010(7)(b) in qualified active low-income community businesses in this state is $8 million, whether made by one or several qualified community development entities. Qualified active low-income community businesses that received qualified low-income investments of up to $4 million prior to January 1, 2014, may receive additional qualified low-income investments, up to a total of $8 million, on or after January 1, 2014, only if the community development entity first submits a project summary demonstrating that the additional investment complies with the requirements of the applicable statutes and rules.

(f) A qualified equity investment must be made before July 1, 2016. Nothing in this paragraph precludes an entity that makes a qualified equity investment prior to July 1, 2016, from claiming a tax credit relating to that qualified equity investment for each applicable credit allowance date.

(g) No more than 40% of the total project costs that are paid for by the qualified low-income community investment may be for working capital, financing and other fees and other soft costs.

(2) A taxpayer claiming a credit may not claim any other credit under ORS 315 or 285C during the same tax year based on activities related to the same qualified active low-income community business.

History

Statutory/Other Authority: ORS 285C.650 - 285C.656 & 315.526 - 315.536
Statutes/Other Implemented: ORS 285C.650-285C.656 & 315.526 -315.536
OBDD 8-2015, f. & cert. ef. 9-1-15
Reverted to OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 2-2015(Temp), f. & cert. ef. 2-12-15 thru 8-10-15
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0040 Ineligible Activities

Not all projects or businesses will qualify for the Oregon Low Income Community Jobs Initiative. Example businesses that are ineligible include but are not limited to:

(1) Residential rental;

(2) Owner occupied housing;

(3) Farming operations;

(4) Private or commercial golf courses;

(5) Country clubs;

(6) Massage parlors;

(7) Hot tub facilities;

(8) Suntan facilities;

(9) Racetracks or other facilities used for gambling; and

(10) Any store of which the principal business is the sale of alcoholic beverages for consumption off premises.

History

Statutory/Other Authority: ORS 285C.650-285C.656 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.650-285C.656 & 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0050 Application and Fees

(1) An applicant seeking to have an equity investment or long-term debt security certified as a qualified equity investment and eligible for a tax credit under ORS 285C.650 and OAR 123-630-0080 must submit an application to the department on a form that the department provides. A complete application must include all of the following:

(a) The entity’s name, address, tax identification number and evidence of certification as a qualified community development entity.

(b) A copy of an allocation agreement executed by the entity, or its controlling entity, and the Community Development Financial Institutions Fund that includes the State of Oregon in its service area.

(c) A certificate executed by an executive officer of the entity attesting that the allocation agreement remains in effect and has not been revoked or canceled by the Community Development Financial Institutions Fund.

(d) A description of the proposed purchase price, structure and purchaser of the equity investment or long-term debt security.

(e) The name and tax identification number of any person eligible to claim a tax credit, under ORS 285C.650–285C.656, and ORS 315.526–315.536, allowed as a result of the certification of the qualified equity investment.

(f) Information regarding the proposed use of proceeds from the issuance of the qualified equity investment on a form provided by the department. If the information described in the previous sentence is not submitted with the application, the applicant shall, at least 20 days prior to the date of the applicant proposes to make a qualified low-income community investment, submit to the department for review and approval of the qualified low-income community investment, an updated qualified low-income community investment certification on a form provided by the department. The information will include but is not limited to the following for each proposed qualified low-income community investment:

(A) Location;

(B) Sources and uses of funds;

(D) Revenues;

(E) Number of jobs created and/or retained; and

(F) Economic impacts

(G) Name and contact information for: the investor making the qualified equity investment(s), the investor making the qualified low-income community investment(s), and all qualified active low-income community business receiving the qualified low-income community investment(s).

(g) A nonrefundable application fee of $20,000. This fee shall be paid to the department and shall be required for each application submitted.

(2) In addition to what is required by the application or in this division of administrative rules, the applicant will submit any information requested by the department for purposes of evaluating the application.

(3) A qualified community development entity submitting an application for certification of an additional equity investment or long-term debt security as a qualified equity investment and eligible for a tax credit under ORS 315.533, must demonstrate to the satisfaction of the department that all previous equity investments and long-term debt securities certified as qualified equity investments have been fully committed and used in compliance with the requirements of the Oregon Low Income Community Jobs Initiative.

(4) A qualified community development entity that is certified under ORS 285C.650 and OAR 123-630-0080 shall pay an annual evaluation fee of $1,000 to the department with the submission of each report described in OAR 123-630-0070.

(5) Applications will be processed on a first come, first serve basis.

(6) Supplemental documentation or attachments submitted to the department by the applicant along with the application form and required materials are not considered part of the application and will be considered to be separate and distinct information submitted to the department. The department will provide approval or consent only with regard to those submissions for which approval or consent is required from the department by statute or rule. If the department does not provide explicit approval in writing for any supplemental information or documentation submitted by the applicant, then the information or documentation is not approved.

History

Statutory/Other Authority: ORS 285C.650 & 315.526 - 315.536
Statutes/Other Implemented: ORS 285C.650 & 315.526 - 315.536
OBDD 8-2015, f. & cert. ef. 9-1-15
Reverted to OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 2-2015(Temp), f. & cert. ef. 2-12-15 thru 8-10-15
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0060 Preference

The department may give preference to applications for projects in traded sectors as identified by the Commission in the Strategic Plan and that demonstrates overall community benefit and have one or more of the following characteristics:

(1) Produce goods that directly reduce emissions of greenhouse gases or are designed as environmentally sensitive replacements for products in current use;

(2) Have a primary purpose of improving the environment or reducing emissions of greenhouse gases;

(3) Are operated by businesses with 100 or fewer employees;

(4) Are located in rural or distressed areas of the state;

(5) Employ displaced workers in the area;

(6) Assist in the economic diversification of the area;

(7) Contain a significant amount of owner equity capital. At least ten percent of the project costs for established companies and 30 percent of project costs for start-ups should come from equity or subordinated loans from the owners;

(8) Encourage the flow of capital from outside the local area; or

(9) Do not cause adverse competitive disadvantages to existing businesses.

History

Statutory/Other Authority: ORS 285C.650 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.650 & 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0070 Reporting Requirements

(1) The qualified community development entity will submit a report by the first anniversary of the initial credit allowance date that provides proof that substantially all of the cash purchase price of its qualified equity investment was used to make qualified low-income community investments in qualified active low-income community businesses located in this state.

(2) Thereafter, the qualified community development entity will submit an annual report within 45 days of the beginning of the state’s fiscal year during the compliance period on a form provided by the department. No annual report shall be due prior to the first anniversary of the initial credit allowance date. The form shall be remitted to the department both in electronic and hard copy formats. The information provided in an annual report will be submitted by the department to the Oregon Department of Administrative Services no later than September 30 following submission of the report and will be posted on the Oregon transparency website no later than December 31 of the same year. The report will include but is not limited to the following:

(a) Number of employment positions created and retained as a result of qualified low-income community investments;

(b) Annual salary of each position described in subparagraph (a) of this paragraph; and

(c) Number of positions described in subparagraph (a) of this paragraph that provide health benefits as described in ORS 743.730.

(d) Proof that substantially all of the cash purchase price of the qualified equity investment continues to be used to make qualified low-income community investments in qualified active low-income community businesses located in this state.

(e) The costs and expenses of making the qualified low-income community investment, including but not limited to fees paid for professional services, including legal and accounting services, related to the formation of operating entities; and

(f) Information with respect to the qualified equity investments made for the purpose of making qualified low-income community investments in Oregon that would be reported as part of the institution level report and transaction level reports submitted by qualified community development entities pursuant to section 45D of the Internal Revenue Code.

(3) The qualified community development entity will submit a report, in a format acceptable to the department, within 5 business days of each qualified low-income community investment made in a qualified low-income community business located in this state. The report will include, but is not limited to, the amount of the investment and the date on which the investment was made to the qualified active low-income community business and will be accompanied by documentation satisfactory to the department regarding the investment.

(4) The qualified community development entity will submit a quarterly report that provides proof that each qualified low-income community investment continues to be invested in qualified active low-income community businesses located in this state. The report will include, but is not limited to, the amount of the original investment, the date on which the original investment was made to the qualified active low-income community business, the current balance of the investment in the qualified active low-income community business, and any reinvestment of capital returned to or recovered from the original investment, exclusive of any profits realized (together with the same type of information regarding said investment as was reported regarding the original investment).

History

Statutory/Other Authority: ORS 285C.650 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.650 & 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0080 Certification

(1) Within 15 days after having received a complete application, the department will grant or deny the application in full or in part and notify the applicant of the decision.

(2) If the application is deemed complete, the department will certify the proposed equity investment or long-term debt security as a qualified equity investment and eligible for a tax credit under ORS 285C.650 and this rule, and subject to the limitations stated in applicable statues and these rules. The department shall provide written notice of the certification to the qualified community development entity. The notice shall include the names of those taxpayers who are eligible to utilize the credits and their respective credit amounts. If the names of the persons or entities that are eligible to utilize the credits change due to a transfer of a qualified equity investment or a change in an allocation pursuant to OAR 123-630-0020(2), the qualified community development entity shall notify the department of the change.

(3)(a) Except as otherwise provided in paragraph (b) below, within 60 days after receiving notice of certification, the qualified community development entity shall issue the qualified equity investment and receive cash in the amount of the certified purchase price. The qualified community development entity must provide the department with evidence of the receipt of the cash investment within 10 business days after receipt. If the qualified community development entity does not receive the cash investment and issue the qualified equity investment on or before the 60th day following receipt of the certification notice, the certification shall lapse and the entity may not issue the qualified equity investment without reapplying to the department for certification. A certification that lapses reverts to the department and may be reissued only in accordance with the application process outlined in this section.

(b) For a qualified equity investment described in ORS 285C.653(2), a qualified community development entity shall issue the qualified equity investment during the period beginning July 1, 2012, and ending 60 days after receiving notice of certification, If the qualified equity investment is issued prior to the submission of an application for certification under the applicable statutes and rules, the qualified community development entity must provide the department with evidence of the qualified equity investment and of receipt of the cash investment at the time of application for certification.

(4) The department shall certify qualified equity investments in the order applications are received by the department. Applications received on the same day shall be deemed to have been received simultaneously. For applications received on the same day and deemed complete, the department shall certify, consistent with remaining tax credit capacity, qualified equity investments in proportionate percentages based upon the ratio of the amount of qualified equity investment requested in an application to the total amount of qualified equity investments requested in all applications received on the same day. Applications for certification under ORS 285C.653(2) and OAR 123-630-0090(2) submitted without complete project summaries commensurate with the amount of certification applied for, may be reduced at the sole discretion of the department. Applications must demonstrate the ability to identify projects described in ORS 285C.653(2) and OAR 123-630-0090(2), and failure to identify projects described in ORS 285C.653(2) and OAR 123-630-0090(2) may additionally result in a reduction of the certification. If a pending request cannot be fully certified because of the limitations in the applicable statutes and 123-630-0090, the department shall certify the portion that may be certified unless the qualified community development entity elects to withdraw its request rather than receive partial credit.

(5) If the department denies any part of the application, the notification to the applicant will include the grounds for denial. The applicant will have 15 days of receipt of the notification to provide additional information to mediate the denial. Within 15 days after the department receives any such additional information, the department will reconsider the application. If the department grants the application upon reconsideration, the approval will be effective as of the original date of submission. If the applicant fails to provide additional information within 15 days of receipt of the denial, the application remains denied.

History

Statutory/Other Authority: ORS 285C.650 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.650 & 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0090 Limitations for Certification

(1) Once the department has certified a cumulative amount of qualified equity investments that can result in the utilization of $16 million of tax credits in any tax year, the department may not certify any more qualified equity investments under ORS 285C.650 and OAR 123-630-0080. This limitation shall be based on the scheduled utilization of tax credits without regard to the potential for taxpayers to carry forward tax credits to later tax years.

(2) The department will reserve $30 million of qualified equity investment authority for qualified low-income community investments in qualified active low-income community businesses that:

(a) Have a primary purpose of improving the environment or reducing emissions of greenhouse gases; or

(b) Produce goods that directly reduce emissions of greenhouse gases or are designed as environmentally sensitive replacements for products in current use.

(3) The department will reserve $170 million of qualified equity investment authority for all other qualified active low-income community investments (which may include the types of investments described in ORS 285C.653(s) and OAR 123-630-0090(2)).

(4) All applications will indicate the amount of qualified equity investment authority sought by the applicant under OAR 123-630-0090(2) and 123-630-0090(3). The maximum amount of qualified equity investment authority for which an applicant may apply under 123-630-0090(2) is $30 million and under 123-630-0090(3) is $170 million.

(5) The department shall pre-screen a qualified community development entity’s proposed investment in a qualified active low-income community business for purposes of determining if the business satisfies the requirements of ORS 285C.653(2) and OAR123-630-0090(2). The department shall, not later than 15 business days after the date of receipt of all relevant documentation, determine whether the qualified active low-income community business satisfies the requirements of ORS 285C.653(2) and OAR 123-630-0090(2) and notify the qualified community development entity in writing of the determination and an explanation of its determination. If the department fails to notify the qualified community development entity with respect to the proposed investment within the period specified in this paragraph, the business in which the qualified community development entity proposes to invest is considered to satisfy the requirements of ORS 285C.653(2) and OAR 123-630-0090(2).

History

Statutory/Other Authority: ORS 285C.650 – 653 & 315.526 – 315.536
Statutes/Other Implemented: ORS 315.526 – 315.536
OBDD 11-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0100 Recapture of Tax Credit

(1) The Department of Revenue may recapture any portion of a tax credit per ORS 285C.656 and ORS 315.533.

(2) The Department of Revenue may recapture any portion of a tax credit if the qualified community development entity applies for and receives qualified equity investment authority under ORS 285C.653(2) and OAR 123-630-0090(2) and fails to invest at least 85 percent of the cash purchase price of the QEI in qualified active low-income community businesses that satisfy the requirements of ORS 285C.653(2) and OAR 123-630-0090(2) within 12 months of the issuance of the qualified equity investment and maintain such level of investment in qualified active low-income community businesses satisfying such requirements until the last credit allowance date for such qualified equity investment.

History

Statutory/Other Authority: ORS 285C.656 & 315.526 – 315.536
Statutes/Other Implemented: ORS 285C.656 & 315.526 – 315.536
OBDD 11-2014, f. 6-30-14, cert. ef. 7-1-14
OBDD 6-2014, f. & cert. ef. 4-1-14
OBDD 9-2013(Temp), f. & cert. ef. 10-15-13 thru 4-11-14
OBDD 9-2012, f. & cert. ef. 6-1-12

Or. Admin. R. 123-630-0110 Confidential Records

(1) Upon written request and within a reasonable time, the Director or his designee shall provide program records, for inspection in accordance with ORS Chapter 192.

(3) Except as otherwise provided in ORS 192.410-192.595, records exempt from disclosure include but are not limited to:

(b) Financial statements, tax returns, business records, employment history and other personal data submitted by or for Applicants, or analysis of such data;

(d) Formulas, plans, designs and related information that constitute trade secrets under ORS 192;

(e) Personal financial statement;

(f) Financial statements of Applicants;

(g) Customer lists;

(h) Information of an Applicant pertaining to litigation to which the Applicant is a party if the complaint has been filed, or if the complaint has not been filed, if the Applicant shows that such litigation is reasonably likely to occur. This exemption does not apply to conclude litigation and nothing in this section shall limit any right or opportunity granted by law to a party involved in litigation;

(i) Production, sales or cost data; and

(j) Marketing strategy information that relates to an Applicant's plan to address specific markets and Applicant's strategy regarding specific competitors.

History

Statutory/Other Authority: ORS 285A.075, 192, 285C.656 & 315.526 – 315.536
Statutes/Other Implemented: ORS 192, 285C.656 & 315.526 – 315.536
OBDD 6-2014, f. & cert. ef. 4-1-14

Division 635 OREGON INVESTMENT ADVANTAGE

Or. Admin. R. 123-635-0000 Purpose and Scope

This division of administrative rules:

(1) Specifies procedures and criteria for certification under the Oregon Investment Advantage Act to exempt the business income of qualified facilities from State income or corporate excise taxation under ORS 316.778 or 317.391, in order to spur investments in new Oregon operations with new full-time employees (earning certain average wages and minimum compensation levels) at qualifying facilities in counties exhibiting the worst per capita incomes and unemployment rates statewide.

(2) Does not control or bind the Department of Revenue and is superseded by OAR chapter 150 in matters related to tax administration.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.495, 285C.500 – 285C.506, 316.778 & 317.391
OBDD 13-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 4-2011, f. 8-31-11, cert. ef. 9-1-11
Renumbered from 123-155-0000, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 1-2009, f. 2-23-09, cert. ef. 2-24-09
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0100 Definitions

As used in this division of administrative rules, in addition to definitions in OAR 123-001 (Procedural Rules), unless the context demands otherwise:

(1) “Business firm” means a person operating or conducting one or more trades or businesses for profit, and does not include any governmental agency, municipal corporation or nonprofit corporation, other than a people’s utility district or a joint operating agency under ORS 262.005.

(2) Compensation means total annual remuneration (whether taxable or not) in the form of wages, salary, overtime pay, shift differential, profit-sharing, bonuses, commissions, paid vacation, and associated fringe or financial benefits such as life insurance, medical coverage and retirement plans that are paid or provided by the business firm seeking certification of a Facility during the firm’s tax year, but excluding:

(a) Free meals, club membership or comparable workplace amenities;

(b) Payroll-based tax or cost mandated by federal, state or local law, such as worker’s compensation, unemployment insurance or the employer’s share under FICA; and

(3) Current County Wage is the finalized average annual figure for all industries and ownerships in the county where the Facility is located, as most recently released by the Employment Department for the Quarterly Census of Employment and Wages (QCEW) when the business firm applies for certification according to OAR 123-635-0300, which for calendar-based applicants will typically be for the year preceding the tax year.

(4) Established County Income is the annual county per capita personal income under ORS 285C.500(2) for the county in which the Facility is located, as most recently available when the business firm last applied or reapplied for preliminary certification according to OAR 123-635-0200.

(5) Facility has the meaning under ORS 285C.500(4).

(6) Municipal Corporation means the following, with respect to the location of a proposed Facility as described in OAR 123-635-0200:

(a) The county government of the county, the territory of which contains the Facility, regardless of whether the location is incorporated or not;

(b) A Port for which the Facility will be located within the territorial limits of the port district; and

(7) Qualified Location means a site for a Facility as described in OAR 123-635-0150.

(8) Unique Operations has the meaning in OAR 123-635-0175.

(9) Wage means the taxable income used in calculating amounts withheld for employees of the business firm seeking Facility certification under ORS chapter 316 for purposes of Oregon personal income taxes during the firm’s tax year.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.500 – 285C.506
OBDD 13-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 12-2012, f. & cert. ef. 8-15-12
OBDD 4-2011, f. 8-31-11, cert. ef. 9-1-11
Renumbered from 123-155-0100, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0150 Qualified Locations

A proposed Facility must be inside a county as determined according to section (1) of this rule, and located at a site satisfying the requirements of section (2) of this rule, at the time when the Department receives the application for preliminary certification:

(1) With respect to county eligibility:

(a) With on-line availability of (non-preliminary) annual statistics or data described in this rule, the Department shall analyze the most current and prior two years’ revised data, ascertain which counties in the state satisfy ORS 285C.500(5)(b), prepare associated information, and post it on the Department web site for use by the public, business firms and local economic development professionals.

(b) The determination described in subsection (a) of this section shall first take effect at least once a year on January 1 or July 1 following on-line availability of the latest annual data. As the Department deems appropriate in response to the release of new annual data or revisions to that data, the Department may reissue or modify the determination, update associated information and set the effective date for changes in county status, as warranted.

(c) A correct, prior determination in accordance with this section is not subject to retroactive change due to subsequent revisions to data for the same or future years.

(2) The specific site of a proposed Facility must meet at least one of the following two requirements:

(a) The site is completely inside the urban growth boundary (UGB) of a city with a population of 15,000 or less based on the most recent decennial U.S. Census count; or

(b) Regardless of being inside or outside of any city’s UGB, the site consists entirely of land zoned for industrial use:

(A) Pursuant to effective municipal zoning ordinances that expressively and generally permit permanent facilities and private operations for heavy or light manufacturing, energy production, fabrication, warehousing, distribution, mineral/agricultural processing or similarly intensive economic uses;

(B) In accordance with applicable state land-use laws, including but not limited to those for unincorporated communities, exceptions from state planning goals, or ORS 197.713, 197.714 or 197.719; and

(C) Such that the Facility's business operations must directly benefit a traded sector industry under ORS 285C.010, regardless of other uses permitted under the particular zoning code ordinance.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.500 & 285C.503
OBDD 13-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 10-2016, f. & cert. ef. 9-16-16
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 12-2012, f. & cert. ef. 8-15-12
Renumbered from 123-155-0150, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0175 Unique Operations

Under ORS 285C.503(5)(e), a business firm’s operations that comprise a Facility proposed for preliminary certification must be new business operations respective to the site of the Facility and to any other location in this state where the firm also operates, such that:

(1) In the case of the business firm itself, the business operations at the Facility must be categorically different from any operations in which that same firm has recently engaged. (As an example, a business firm may receive certification for a Facility that will manufacture or distribute certain products here for the first time, even if the firm already maintained operations in this state for selling its products)

(2) In the case where the business firm has 100-percent common equity interest or is under common control (by way of corporate, familial or similar affiliations) with one or more other business firms operating in this state, the business operations at the Facility must be significantly dissimilar from the operations in which any other such firm has recently engaged. (As an example, a corporate subsidiary is certifiable for a new, first-in-Oregon facility fabricating a laminated wood product, even if another wholly owned subsidiary of the same parent company already makes a similar product in this state, but the new operations utilize an advanced generation of technology with which the product has higher performance standards or weight-bearing specifications)

(3) Irrespective of section (1) or (2) of this rule, the acquisition of a preexisting Facility does not qualify as new business operations, unless both of the following are satisfied:

(a) The business firm invests appreciably in real property or extensively in terms of installing personal property at the Facility after applying for preliminary certification; and

(b) The operations that the firm will undertake pursuant to the new investment are significantly dissimilar from operations recently performed at the Facility.

(4) For purposes of this rule:

(a) “Categorically different” means that the existing, in-state business operations produce, render, deliver or provide essentially another type of good or service for a distinct market segment or customer base.

(b) “Recently” means during the 12 months before the date, on which the Department received the application for preliminary certification.

(c) “Significantly dissimilar” means that the existing, in-state business operations, or the goods or services arising from them, utilize different technology, processes, delivery methods, points in supply chain, marketing, brand names or the like.

(5) How much a Facility’s proposed operations are like those of any other business (even one with partially shared ownership), anywhere in Oregon, does not matter, except as provided under ORS 285C.503(4)(b)(A) and (5)(f) to the extent that the operations will compete with other employers in the local area as addressed in OAR 123-635-0270(4)(b) and (5).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.500 & 285C.503
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 4-2011, f. 8-31-11, cert. ef. 9-1-11
Renumbered from 123-155-0175, OBDD 1-2011, f. & cert. ef. 1-3-11
EDD 1-2009, f. 2-23-09, cert. ef. 2-24-09
EDD 9-2005, f. & cert. ef. 11-4-05

Or. Admin. R. 123-635-0200 Preliminary Certification Application

For purposes of ultimately seeking the exemption under ORS 316.778 or 317.391:

(1) A business firm must complete an application for preliminary certification and send it to the Department, as follows:

(a) Using the form prescribed by the Department; and

(b) Before the following:

(A) Commencement of construction, installation or similar activities with respect to any new property or improvements, which excludes site work or preparation other than appreciable improvements to the land, that constitute any part of the proposed Facility; and

(B) Hiring of any employee, who will constitute the five or more required employees at that location.

(2) The preliminary certification application must include a fee of $500 in the form of a check or money order payable to the Department.

(3) Applications are available from and shall be submitted to: Incentives, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301-1280, see www.oregon.gov/biz.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.503
OBDD 26-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 16-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 4-2011, f. 8-31-11, cert. ef. 9-1-11
Renumbered from 123-155-0200, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0250 Determination of Preliminary Certification

Pursuant to a filing of a preliminary certification application as described in OAR 123-635-0200:

(1) The Department shall:

(a) Review the application for completeness; and

(b) Determine whether the business firm and the applicant's proposed Facility:

(A) Is at a Qualified Location;

(B) Represents Unique Operations; and

(2) After receipt of the application, the Department shall do the following:

(a) Notify the applicant in writing whether it is complete; and

(b) Send a copy of the application to the Municipal Corporations, in such a way that the date of sending is recorded, unless officials of the Municipal Corporation have already formally expressed support for the proposed Facility’s use of this program comparable to subsection (3)(b) of this rule.

(3)(a) The Department shall complete the determination described in subsection (1)(b) of this rule, after receiving any additional information requested from the applicant; but

(b) The determination shall not be final sooner than 60 days from the date, on which the Department sent the copy of the application to the Municipal Corporations, unless they all have provided sufficient response, such as a written confirmation of “no objection” from local officials based on communication with governing body members.

(4) After fulfillment of section (3) of this rule, the Department shall notify the applicant in writing of its decision, which shall include but is not limited to the following, in the event that the Department:

(a) Denies preliminary certification, it shall send the applicant either notice consistent with OAR 123-001-0725 or only a written statement of explanation if the denial results from an objection as described in OAR 123-635-0270(2).

(b) Approves the preliminary certification, it shall send a letter conferring preliminary certification.

(5) The Department shall send notification of the final determination on preliminary certification to relevant staff of the Department of Revenue.

(6) Subject again to the criteria and procedures in this rule, a preliminary certified business firm may refile in order to renew and advance the date of its preliminary certification for purposes of OAR 123-635-0350(3).

(7) The Department may issue an amended preliminary certification as appropriate, pursuant to revised information about the proposed Facility as formally received from the business firm before the end of the tax year, for which the first filing may be made according to OAR 123-635-0350(2). In determining whether to issue the amended preliminary certification, the Department shall consider:

(a) Issues described in OAR 123-635-0350(6); and

(b) Material implications in terms of ORS 285C.503(4)(b), consulting with the Municipal Corporations beforehand as warranted.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.503
OBDD 5-2016, f. & cert. ef. 3-28-16
Renumbered from 123-155-0250, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0270 Local Objection and Relevant Requirements

Respective to a proposed Facility:

(1) For purposes of section (2) of this rule, a Municipal Corporation may object to preliminary certification through a formal submission to the Department, but the Department must receive the objection, a copy of an adopted resolution, and any requisite information, within 60 days from the date the Department sent a copy of the application for preliminary certification to the governing body of the Municipal Corporation in OAR 123-635-0250(2)(b). Otherwise, the Municipal Corporation is deemed to agree to preliminary certification.

(2) In order for the objection to be automatic and not subject to appeal in a contested case, the objection must take the form of a resolution:

(a) Adopted by the governing body during the 60-day period, in accordance with applicable local laws, government charter and practices; and

(b) Containing a statement of the reason(s) for objection under ORS 285C.503(4)(b) and accompanied by information, as described in subsection (5)(b) or section (6) of this rule.

(3) Irrespective of sections (1) and (2) of this rule or the adoption of a resolution, every Municipal Corporation is encouraged and expected to furnish timely evidence to the Department, if local officials believe that the proposed Facility does not satisfy a requirement under ORS 285C.503(5).

(4) Besides entries in the application, the Department shall rely especially on the Municipal Corporations in determining whether:

(a) Health insurance coverage of all Facility employees will be at least equivalent to that of Municipal Corporation employees, if applicable under ORS 285C.503(5)(d)(B).

(b) Business operations will meaningfully compete with one or more existing businesses operating locally and employing persons, who reside in the city, port or county, including competition for:

(A) Local customers;

(B) Skilled workers or managers within the local labor pool;

(D) Comparable circumstances, which always exclude general inter-firm rivalry within the broader marketplace.

(5) If local competition as described in subsection (4)(b) of this rule is indicated, then it must be either:

(a) Supported with clear evidence furnished by the Municipal Corporation, based on which the Department can independently make a determination under ORS 285C.503(5)(f); or

(b) Identified by type or basic nature in the formal statement of objection with a resolution in accordance with sections (1) and (2) of this rule.

(6) In order for the Department to deny an application for preliminary certification based on incompatibility with local growth or development standards, the Municipal Corporation must make a formal submission in accordance with sections (1) and (2) of this rule that includes a resolution and information documenting the relevant standards and showing that they were established in municipal ordinances already in effect when the business firm submitted the application to the Department.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.503
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 1-2011, f. & cert. ef. 1-3-11, Renumbered from 123-155-0270
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0300 Annual Certification

For purposes of certification of a Facility pursuant to each income or corporate excise tax year of the business firm under ORS 285C.506:

(1) A preliminarily certified business firm that owns or leases and operates the Facility must file the application for annual certification with the Department:

(a) On or before the 30th day after the end of the tax year, for which it is seeking to claim or exercise the exemption under ORS 316.778 or 317.391.

(b) Using the form prescribed by and available from the Department: Incentives, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301-1280, see www.oregon.gov/biz.

(2) Each application must include a fee of $100 in the form of a check or money order payable to the Department.

(3) Within 30 days after the date of filing, Department staff shall review the application, consider potential fact-finding about the Facility under ORS 285C.506(5) to (8), as feasible and appropriate, and determine whether it satisfies the applicable requirements for annual certification. Then, if the Department:

(a) Denies annual certification, it shall send notice consistent with OAR 123-001-0725.

(b) Approves the annual certification, it shall send a letter conferring certification for the just concluded tax year.

(4) The Department shall also copy relevant staff at the Department of Revenue with items as described in section (3) of this rule and the associated application.

(5) Requirements under ORS 285C.503(5)(d) are satisfied based on at least any five of the full‑time, year‑round employees, for whom the business firm is their employer under ORS chapter 316, and who work in jobs newly created at the Facility since the firm’s application for preliminary certification, in that:

(a) If the application was made before July 1, 2011, there is no wage or compensation requirement.

(b) If it was made on or after July 1, 2011, the Compensation of each of those five employees during the tax year must equal or exceed:

(A) 150 percent of the Established County Income; or

(B) 100 percent of the Established County Income, provided that the firm currently provides health insurance benefits and coverage to facility employees that appear to be effectively of the same or better quality than the benefits and coverage enjoyed by local municipal employees.

(A) In addition to subsection (b) of this section or paragraph (B) of this subsection, the Wages paid to those employees on average during the tax year must equal or exceed the Current County Wage.

(B) In lieu of paragraph (b)(A) of this section, the Compensation of each of those five employees during the tax year may instead equal or exceed as little as 130 percent of the Established County Income, provided that no part of the Facility is inside Benton, Clackamas, Columbia, Deschutes, Jackson, Josephine, Lane, Linn, Marion, Multnomah, Polk, Washington or Yamhill County.

History

Statutory/Other Authority: ORS 285A.075 & 285C.506(4)
Statutes/Other Implemented: ORS 285C.506
OBDD 27-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 16-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 12-2012, f. & cert. ef. 8-15-12
Renumbered from 123-155-0300, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0350 Issues of Initial and Subsequent Annual Certifications

For purposes of annual certification as described in OAR 123-635-0300:

(1) The preliminarily certified business firm needs to have:

(a) Fully acquired Facility property and completed it in terms of construction, reconstruction, modification and installation of proposed improvements for purposes of subsection (c) of this section;

(b) Hired relevant employees; and

(2) The first such filing may occur not less than 24 months after the date, on which operations commenced according to section (1) of this rule (if the firm applied for preliminary certification on or after July 1, 2011), such that the exemption on taxable income may not begin at the earliest until:

(a) The second tax year after the year containing that date; or

(b) The next year following the year containing that date, if its second anniversary falls within the first 30 days after the tax year.

(3) For purposes of this first filing, the application shall show that after the date, on which the Department approved the preliminary certification:

(a) Business operations commenced at the Facility within:

(A) Six months, if only acquiring existing buildings or structures; or

(B) Eighteen months, if involving substantial construction or reconstruction; and

(b) Facility property did not remain in an unfinished state of construction, reconstruction, modification or installation for more than six months without significant progress toward completion of such activities.

(4) In order for the Department to certify the Facility with the first filing:

(a) Information in the application needs to indicate satisfaction of section (3) of this rule, except as allowed by Department staff through a written finding that any delay or interruption was reasonable and not excessive, given the complexity or extent of the business firm’s investment in the Facility or of inadvertent circumstances.

(b) The location and nature of the Facility’s business operation need to conform to that represented in the application for preliminary certification, including but not limited to any amendment according to OAR 123-635-0250(7).

(5) For purposes of an application for annual certification:

(a) Its approval shall not depend on any current issue of actual competition with other local businesses, Qualified Location or Unique Operations.

(b) The Department may deny the application if discovering that at the time of application for preliminary certification, the Facility was not at a Qualified Location or did not represent Unique Operations, including but not limited to the case where the preliminary certification application contained false or incomplete information.

(c) The Department may approve the application, even if the nature of the Facility or the business firm/ownership changes after the first filing, including but not limited to changes in:

(A) The composition of Facility property or its exact location; or

(B) The corporate or ownership structure or organization of the business.

(6) To allow a change described in subsection (5)(c) of this rule depends on:

(a) Direct, ongoing continuity with the original facility;

(b) Business operations remaining materially the same; and

(c) Relative to the location identified in the application for preliminary certification, the Facility is located at what was likewise a Qualified Location inside the same urban growth boundary or at a similarly proximate location.

(7) The business firm does not need to make its first filing as soon as permissible according to section (2) of this rule, or it might miss or skip any subsequent opportunity, for which it is allowed to apply for annual certification, such that the firm may still use the exemption for any remaining, eligible tax year that is not more than nine consecutive tax years after the first year, for which it is allowed as described in section (2) of this rule; however:

(a) Neither postponement of the first filing nor failure to apply in any subsequent tax year shall affect the period for which certification is otherwise allowed.

(b) The business firm may not claim or exercise the exemption under ORS 316.778 or 317.391 for any such tax year, pursuant to which it does not directly make application for annual certification as described in OAR 123-635-0300.

(8) If an application for annual certification is timely filed but denied by the Department, then the exemption is disallowed not only for that year, but also for all other remaining, eligible tax years (but without retroactive effect on any prior exemption).

History

Statutory/Other Authority: ORS 285A.075 & 285C.506(6) & (7)
Statutes/Other Implemented: ORS 285C.506, 316.778 & 317.391
OBDD 12-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 5-2016, f. & cert. ef. 3-28-16
OBDD 12-2012, f. & cert. ef. 8-15-12
Renumbered from 123-155-0350, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Or. Admin. R. 123-635-0400 Application Fees, Waivers

With respect to application fees as described in this division of administrative rules:

(1) The Department may excuse the fee or reduce the required amount:

(a) If a business firm's Facility readily qualifies for certification, but as determined based on Department experience and expertise relative to general business activity in the county, region or statewide, it:

(A) Is very small in size;

(B) Has minimal employment; or

(C) Will likely have modest revenue prospects and little likelihood of effectively realizing much benefit from the exemption on taxable income; or

(b) If it can be demonstrated that such a waiver will further the goals and objectives of the program and other relevant public policies, for example, when partial or non-imposition of the fee might promote business investments in areas of the state where the exemption has not yet been used.

(2) The Department shall return or refund the amount collected to the applicant, if it rejects the application or denies the preliminary or annual certification, pending a final order to that effect.

(3) The moneys collected would defray administrative costs; in particular, they may be critical for offsetting legal expenses in the event of contested case appeal.

History

Statutory/Other Authority: ORS 285A.075, 285C.503(3) & 285C.506(4)
Statutes/Other Implemented: ORS 285C.503 & 285C.506
OBDD 4-2011, f. 8-31-11, cert. ef. 9-1-11
Renumbered from 123-155-0400, OBDD 1-2011, f. & cert. ef. 1-3-11
OBDD 5-2010, f. 1-29-10, cert. ef. 2-1-10
EDD 9-2005, f. & cert. ef. 11-4-05
EDD 17-2002, f. 11-27-02, cert. ef. 12-2-02

Division 650 ENTERPRISE ZONE CREATION AND AMENDMENT

Or. Admin. R. 123-650-0001 Temporary rule language in effect until 12/01/2026. Purpose and Scope

(1) This division of administrative rules governs the existence, modification and termination of regular enterprise zone areas under ORS 285C.050 to 285C.250 ( Oregon Enterprise Zone Act ) that are:

(a) Sponsored by city, port and county governments; and

(b) Designated initially due to a measure of economic need.

(2) Subsequent divisions in this chapter address related types of designations and the tax incentives for business firms in the various zones, in particular, see OAR 123-656 for tribally and federally related enterprise zones and OAR 123-668 for guidelines respective to local zone sponsorship.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.045 & 285C.050 – 285C.250
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-0066 Enterprise Zone Existence

(1) On and after October 5, 2015, there is no statewide numerical limit on enterprise zone designations or re-designations under ORS 285C.065 and 285C.250.

(2) In addition, there are allowed:

(a) Designations based on a federal enterprise zone directly under ORS 285C.085; and

(b) Reservation enterprise zones and reservation partnership zones, under ORS 285C.306.

(3) As of October 4, 2015, 68 enterprise zones were in existence by order of the Director in accordance with statutory provisions, as follow:

(a) Eighteen under ORS 285C.065 and former ORS 285C.075 and 285C.080;

(b) Forty-eight under ORS 285C.065 and 285C.250 (one of which was initially designated under ORS 285C.085);

(d) Two reservation enterprise zones under ORS 285C.306(2).

(4) Of the 66 designations enumerated in subsections (3)(a) and (b) of this rule, 8 were still extant as of September 23, 2023, such that they or any other designation described in section (1) or (2)(a) of this rule:

(a) Shall continue to exist and may be amended under ORS 285C.050 to 285C.250 until they terminate; and

(b) May be re-designated as otherwise allowed until June 30, 2032, after which enterprise zone designations sponsored by local governments are disallowed under ORS 285C.255(1)(a).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050 – 285C.250 & 285C.255
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
Renumbered from 123-650-0075, OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12

Or. Admin. R. 123-650-0100 Temporary rule language in effect until 12/01/2026. Definitions

ORS 285C.050 and OAR 123-001 (Procedural Rules) contain definitions used in this division of administrative rules. In addition, unless the context demands otherwise:

(1) Census Statistical Unit includes any standard geographic area, jurisdictional entity, administrative designation, or parts of one, for which the U.S. Bureau of Census or other federal, state or institutional/academic sources issue recurring economic data, including but not limited to: County, county subdivision, city/place, census tract or census block group.

(2) Data Center means real and personal property consisting of buildings or structures specifically designed or modified to house networked computers and data and transaction processing equipment, the computers contained within, and related infrastructure support equipment including but not limited to power and cooling equipment. To qualify as a data center under this definition, the storage, processing, transmission, or retrieval of digital data must constitute the primary commercial purpose of such buildings or structures and their operations. Covered buildings or structures include but are not limited to those used primarily for colocation services, cloud computing services, artificial intelligence training or inference services, or digital asset mining services, whether such services are internal or external services, i.e. provided to third parties or operated for the company's own commercial operations. For purposes of this definition, the primary use of property is based on the relative proportion of the original cost of property used for all purposes. Data Center does not include:

(a) A server room, network operations facility, or other computing infrastructure that is incidental to and operated exclusively in support of the primary non-computing business operations of a single entity conducted at the same or an affiliated location. This includes, but is not limited to, computing infrastructure integral to semiconductor fabrication, manufacturing process control, industrial process design, or chemical or materials research, provided that such computing infrastructure is not held out or marketed as a service available to persons other than the entity and its affiliates; or

(b) A telecommunications switching, routing, or network transmission center whose primary design and function is the carriage of voice, video, or broadband communications rather than the storage, processing, or hosting of data for end users.

(3) Data center project means the construction of a building or structure, installation of real property machinery or equipment or personal property, expansion or modification of an existing building or structure, or substantial re-equipping of a data center, or the acquisition of real property machinery, equipment (newly purchased, newly leased or newly transferred) used primarily in operating a data center.

(4) Enterprise Zone Population means, based on either the latest decennial U.S. Census count or the most recently available estimate from the Portland State University Population Research Center:

(a) For rural enterprise zones, the total population of incorporated cities, in which any part of the zone is located, plus the currently estimated population of any Census Statistical Unit that tightly envelope unincorporated zone areas; or

(b) For urban enterprise zones, the currently estimated population of Census Statistical Units that tightly envelope zone areas, and it may also include any associated residential area or group of such areas proximate to the zone boundary that encompass a populace, whom the Sponsoring Government(s) explicitly intend to serve through employment opportunities and relevant public or private efforts or programs in relation to the zone.

(5) Local Area means the geographic area within which the enterprise zone generates or is reasonably expected to generate measurable economic activity. The size of the geographic area for each enterprise zone will vary by location. The local area shall be determined by analyzing various factors that includes but is not limited to geographic scope of job creation, capital investment impacts, employment data related to where employees live and spend their wages, tax revenue impacts on local government taxing districts and area fiscally affected by the enterprise zone, indirect economic impacts (ripple effects or supply chain transactions from businesses within same geographic area)and/or jurisdictional oversight by the sponsor(s). The local area shall be determined by the sponsor(s) and based on economic development evidence and circumstances. The local area does not require all of a sponsor’s jurisdiction to be included, but it must include the entirety of the designated enterprise zone territory.

(6) “Original enterprise zone,” as used in ORS 285C.115(2) for purposes of boundary changes, means the area within the boundary of the zone at the time when it was most recently (re-)designated, irrespective of any intervening boundary change.

(7) Sponsoring Government means a county, port or city designating an enterprise zone (or a district that has effectively the same governing body as the county, port or city, and that contains all the city, port or county territory inside the proposed zone). A Sponsoring Government may be any city, port or county in Oregon, or any combination of such jurisdictions as provided in OAR 123-650-0500, except as described in OAR 123-650-0600 or 123-650-4900(2)(c).

(8) Terminated-by-Statute means the automatic termination of an enterprise zone by operation of law after more than 10 years under ORS 285C.245(1)(a).

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.066
Statutes/Other Implemented: ORS 285C.050 – 285C.250 & Oregon Laws 2026, Chapter 50
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-0105 Temporary rule language in effect until 12/01/2026. Temporary Restriction on Data Center Project Authorization

(1) Pursuant to Section 11b, Chapter 50, Oregon Laws 2026 (Enrolled House Bill 4084), and notwithstanding any other provisions of this division of administrative rules, an eligible business firm may not be authorized under ORS 285C.140, for a property tax exemption under ORS 285C.175 (standard enterprise zone exemption) with respect to property consisting of a data center project between June 5, 2026 and the date that is 90 days following the date on which the 2027 regular session of the Oregon Legislative Assembly adjourns sine die.

(2) For purposes of this rule:

(a) “Data center” has the meaning set forth in OAR 123-650-0100.

(b) “Data center project” has the meaning set forth in OAR 123-650-0100.

(3) For avoidance of doubt, this rule does not apply to the following:

(a) Eligible business firm authorizations of a data center project for a standard enterprise zone exemption that were made by the zone sponsor(s) and the county assessor before June 5, 2026, i.e. the zone sponsor and the county assessor approved the business firm’s application for authorization submitted pursuant to ORS 285C.140, for property tax exemption under ORS 285C.175, before June 5, 2026, the effective date of Section 11b, Chapter 50, Oregon Laws 2026.

(b) Business firm certifications of the zone sponsor(s) and the county assessor that approve a business firm’s data center project application under ORS 285C.403, for a long-term property tax exemption under ORS 285C.409 for qualified property located in a rural enterprise zone.

(c) An “eligible project” as defined by ORS 285C.600 that is located in a strategic investment zone established under ORS 285C.623, within which the property may be exempt from property taxation under the strategic investment program established under ORS 285.600 to 285C.635 and ORS 307.123.

(4) This rule is repealed on January 1, 2029, pursuant to Section 11c, Chapter 50, Oregon Laws 2026.

History

Statutory/Other Authority: ORS 285A.075, ORS 285C.060(1) & Oregon Laws 2026, Chapter 50
Statutes/Other Implemented: Oregon Laws 2026, Chapter 50 & ORS 285C.140
OBDD 10-2026, temporary adopt filed 06/05/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-650-0500 Local Government Sponsorship or Consent

For purposes of enterprise zone designations, re-designations or boundary changes:

(1) The zone shall be sponsored by, and only by, the governing body of every city, port or county, in whose territory the zone is located, with the following exceptions:

(a) A port need not cosponsor a zone, if both of the following are true:

(A) The zone is located inside the territory of a sponsoring city, county or two or more such jurisdictions; and

(B) The port granted consent for the zone to exist in its territory through a resolution adopted by the port’s governing body.

(b) A county need not cosponsor a zone, if:

(A) The zone is located completely in the incorporated territory of the city or cities that sponsor(s) the zone;

(B) The county has consented to the zone in its territory for sponsorship by a port through a resolution adopted by the governing body of the county; or

(C) The county granted consent for the zone in its unincorporated territory through a resolution adopted by the governing body of the county, and the only unincorporated territory inside the zone lies within the urban growth area (UGA) between the corporate limits and the urban growth boundary (UGB) of a city that sponsors the zone. (Inside a regional or metropolitan urban growth boundary, any such UGA must be subject to annexation by the sponsoring city)

(A) The zone is located inside the territory of a sponsoring county or of a sponsoring port;

(B) The city granted consent for the zone to exist in its territory through a resolution adopted by the city’s governing body based on port/county sponsorship; and

(2) City/county/port sponsorship or consent is permissible in combinations not specifically described by section (1) of this rule.

(3) Resolutions by the governing body of a city, port or county for purposes of consent need simply identify the enterprise zone, and that its containing territory inside the city, port or county is acceptable, supported or the like.

(4) Under ORS 285C.068 a port may become a cosponsor of an existing zone that contains parts of the port district, at any time, by adopting a resolution with applicable elements of OAR 123-650-4800(2) and submitting an executed copy of it to the Department with consent resolutions from all existing cosponsors.

(5) If a city annexes into its jurisdiction any area of an existing zone, of which the city is not a sponsor, or to which the city has not consented:

(a) The tax exemptions under ORS 285C.175 of authorized or qualified business firms in the annexed area shall continue unaffected, enjoying the same protection under relevant provisions of law and this chapter of administrative rules for location in a terminated enterprise zone.

(b) An eligible business firm proposing an investment in qualified property at a location in the annexed area of the zone may be authorized on a contingent basis, such that the firm may neither qualify nor receive a property tax exemption on such property unless and until such time as either the city:

(A) Consents by resolution of the city’s governing body that the zone as it currently exists may contain areas that have or may be annexed; or

(B) Becomes a new cosponsor of the zone by resolutions adopted by the city and the zone sponsor and submitted to the Department, in accordance with applicable elements of OAR 123-650-4800(2) and 123-650-4900.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.066
Statutes/Other Implemented: ORS 285C.050, 285C.065, 285C.066, 285C.068, 285C.115 & 285C.250
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-0600 Zones Allowed per Jurisdiction

Enterprise zone designations, re-designations and boundary changes are subject to negative determinations under ORS 285C.074 and 285C.117, if needlessly redundant, in that:

(1) Whenever practical, would-be Sponsoring Government(s) shall consider joining together with other city, port and county cosponsors through mutual re-/designations and boundary changes, in order to:

(a) Complement the standards under ORS 285C.120(2)(b) as addressed in OAR 123-650-1100(5);

(b) Make the most of limited resources among agencies, especially at the local level, for administrating and marketing every enterprise zone in the pursuit of business development; and

(2) Cities shall actively explore cosponsoring an enterprise zone, as allowable by OAR 123-650-0700 to 123-650-1100, if both cities are interested in including area inside a zone, or if one already sponsors a zone and the other is so interested, and their respective urban growth boundaries (UGBs) are separated:

(a) By 5 miles or less in any case; or

(b) In the case of a rural zone in sparsely populated counties:

(A) By 15 miles or less; or

(B) By more than 15 miles for any city with a population of 2,000 or less, based on the most recent decennial U.S. Census count, whenever the waiver consistent with OAR 123-650-1100(4) is feasible and appropriate.

(3) The obligation in section (2) of this rule extends equivalently to ports or counties that are cosponsors or would-be Sponsoring Governments, including but not limited to areas outside of UGBs being brought into an enterprise zone that is (also) sponsored by one or more cities.

(4) Specifically for purposes of ORS 285C.066(2), only one enterprise zone may:

(a) Exist at any one time inside the UGB of any city, whether or not it sponsors the zone, except that based on the most recent decennial U.S. Census count:

(A) Two zones are allowed if the city’s population is 100,000 or more.

(B) Three zones are allowed if the city’s population is 500,000 or more.

(b) Be designated per county for a zone containing solely unincorporated territory, as sponsored by the county or a port in that county but not by any city. The Department may still allow an exception to this subsection if finding that the second or third such zone in the county:

(A) Is located in a rather distant and different part of that county;

(B) Comprises near areas in another county; or

(C) Would serve one or more exigent business development opportunities, and that distances within the county or other factors render other options impractical or counterproductive.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1), 285C.066 & 285C.120(2)(b)
Statutes/Other Implemented: ORS 285C.060, 285C.066 & 285C.120
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-0700 Rural and Urban Designations

As defined under ORS 285C.050, an enterprise zone is categorized as either ‘rural’ or ‘urban’ under ORS 285C.050(18) or (22), such that:

(1) As used in ORS 285C.050(22), “regional or metropolitan urban growth boundary” means the UGB encompassing:

(a) The principal Oregon city or cities of a federally established metropolitan statistical area (MSA), according to the most recent delineation of such statistical areas by the White House Office of Management and Budget (OMB) of the U.S. Government; and

(b) Any other city that jointly undertakes comprehensive planning with such a city to determine their mutual UGB.

(2) Subject to change in the delineation of federal MSAs in Oregon or their principal cities, or in joint arrangements for inter-city planning, section (1) of this rule currently pertains to the UGBs for:

(a) Albany;

(b) Bend;

(d) Eugene and Springfield;

(e) Grants Pass;

(f) Medford;

(g) Portland and Hillsboro with all other cities inside the Metro UGB; and

(h) Salem with Keizer.

(3) An enterprise zone may be neither designated, re-designated nor amended to include areas both inside and outside a regional or metropolitan urban growth boundary, based on the circumstances described in section (1) or (2) of this rule at the time that the Department receives the local sponsor advisory under ORS 285C.078 or boundary change submission under ORS 285C.117.

(4) The rural/urban category of any existing enterprise zone may switch according to a change in the circumstances with section (1) or (2) of this rule, as determined by the Department, including but not limited to local sponsor preference, provided the zone boundary is not intersected as described in section (5) of this rule.

(5) If a UGB amendment, a change described in section (4) of this rule, or some other occurrence causes a regional or metropolitan urban growth boundary to intersect an existing enterprise zone boundary, the zone’s categorization as either urban or rural shall remain as it is. If a subsequent modification or occurrence situates the zone entirely outside or inside of that boundary, then the zone’s categorization as rural or urban may switch accordingly at that time.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.066
Statutes/Other Implemented: ORS 285C.050 – 285C.250
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-1000 DIMENSIONS AND BOUNDARIES — Size and Distances

For purposes of an enterprise zone designation, re-designation or boundary change:

(1) Except as allowed in OAR 123-650-1100:

(a) The straight-line distance between any two points within the zone may not exceed 12 miles if it is urban, or 15 miles if it is rural.

(b) A separate area of the zone must be five or fewer miles of straight-line distance away from another area of the zone as measured between the two closest points of each area.

(2) No part of the zone may be inside the boundary of another enterprise zone.

(3) The total area of the zone may not exceed 12 square miles if it is urban, or 15 square miles if it is rural, for which the following may be ignored, even though they are within the zone boundary:

(a) Any road, track, transmission line or the like that nominally links separate areas of the zone for visual continuity;

(b) Public rights‑of‑way, incidentally within the zone area definition or included with parcels or tax lots comprising the zone, that are actively in use as part of the public domain, completely unavailable for private development, and not expected to be ever vacated; or

(c) Any area below the ordinary high-water mark of navigable bodies of water, including but not limited to this state’s border territory that is also within the jurisdiction of the zone sponsor, such as areas of the ocean up to three nautical miles directly from shore. Nevertheless, property located in such an area is inside the zone boundary for purposes of exemption from taxes.

(4) Total area for purposes of section (3) of this rule is not otherwise limited only to the net area for assessment and taxation of tax lots comprising the zone.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, 285C.090 & 285C.120
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-1100 Extended Rural Distances

For purposes of ORS 285C.050(19), 285C.090(4) and 285C.120:

(1) This rule has no bearing on total enterprise zone area as limited in OAR 123-650-1000(3) and applies only to rural enterprise zones that are or will be at least partially outside a county, for which the most recently available estimate from the Portland State University Population Research Center of the county’s total population divided by its area exceeds 100 persons per square mile. Such a county is defined herein for purposes of this rule as a “ densely populated county ,” of which there are seven: Benton, Clackamas, Marion, Multnomah, Polk, Washington and Yamhill counties.

(2) The maximum distance allowed in OAR 123-650-1000(1)(a) increases from 15 to:

(a) 25 lineal miles, if no area of the zone is in a densely populated county; or

(b) 20 lineal miles, if some but not all of the zone area lies in a densely populated county.

(3) The maximum distance allowed in OAR 123-650-1000(1)(b) increases from 5 to 15 lineal miles if none of the separate area is in a densely populated county.

(4) In accordance with ORS 285C.120(2), the Director may waive a limitation in section (2) or (3) of this rule to allow even greater distance as part of an applicable enterprise zone designation, re-designation or boundary change:

(a) As specifically requested by the Sponsoring Government(s) or zone sponsor in the documentation submitted to the Department as described in OAR 123-650-4100 or 123-650-4400;

(b) Such that the waiver is approved by the Director in the context of the Department’s issuing a positive determination as described in OAR 123-650-4900; and

(5) For a waiver in section (4) of this rule, the following three points need to be satisfied:

(a) Challenges or difficulties might otherwise arise were separate enterprise zones to be created, including but not limited to an isolated site or small community that would be ineffective or inefficient on its own as a zone with respect to such matters as marketing, management or assistance to eligible business firms in the zone;

(b) Effective administration within the overall zone boundary appears likely, in that for example, it is located entirely in one county or traversable over relatively direct and efficient road distances; appointed zone management is capable of serving the entire zone, or the zone sponsor will devote sufficient resources for management of the extended zone; and

(A) Further goals and purpose of applicable state policies, including but not limited to the Oregon Enterprise Zone Act or state land use goals; or

(B) Offer the opportunity to site a significant business investment efficiently and expeditiously, to assist a community exhibiting particular hardship, or to accommodate the expressed preference of local jurisdictions.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.120(2)(b)
Statutes/Other Implemented: ORS 285C.050, 285C.090 & 285C.120
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-1500 Mapping and Defining Zone Boundary

Any enterprise zone designation, re-designation or boundary change shall demonstrate adherence to OAR 123-650-1000 or 123-650-1100 by including all of the following with the documentation submitted to the Department under ORS 285C.074 or 285C.117:

(1) An estimate to the nearest 0.1 square miles of the entire zone area (after accounting for area added or removed due to any boundary change) in accordance with OAR 123-650-1000(3) and (4).

(2) Map or set of maps drawn to scale with north directional arrow, legend/scale and title using the zone name, as well as clear representation of the zone boundary, including:

(a) An overview map showing the entire zone on a single page; and

(b) Inset, subsidiary or supplemental maps, as necessary or appropriate, in order to:

(A) Provide detail for portions of the zone as referenced or linked to the overview map; and

(B) Specify areas added or removed.

(3) Narrative description of the overall enterprise zone boundary in a continuous fashion (incorporating any boundary change) that corresponds to the mapping in section (2) of this rule, but which would overrule the mapping in the event of any material discrepancy. The description shall rely on one of the following methods that exactly corresponds to the zone boundary, or a combination of them if fitting together clearly, comprehensively and without redundancy:

(a) Professional metes and bounds surveying;

(b) Permanent landmarks or natural margins such as a waterway, road, track or transmission line;

(c) Official borders or demarcations such as city limit, urban growth boundary, county line or right of way based on specifically dated citations or documents (zone boundary does not change along with any subsequent change to the demarcation);

(d) Whole cadastral sections, quarter sections and so forth; or

(e) Listing of tax lots in relation to specified and dated county assessor maps with associated township, range and section numbering:

(A) In a table with multiple other data for each tax lot that further identify it, such as street address, legal description, zoning, area, tax code, coordinates, or property tax account number; and

(B) Preferably supplemented with copies of the respective assessor maps.

(4) The following items, which are submitted electronically to the Department (even if other items in this rule need not be):

(a) A single set of geo-coded data, for a geographic information systems (GIS) shape file, specific only to that entire zone (pursuant to any boundary change) and not in combination with any other enterprise zone; and

(b) Image file corresponding to subsection (2)(a) of this rule (silently incorporating any boundary change).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.065, 285C.074, 285C.085, 285C.090, 285C.115, 285C.117, 285C.120 & 285C.250
OBDD 28-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-4000 Temporary rule language in effect until 12/01/2026. DESIGNATIONS & BOUNDARY CHANGES — Initiating Designation

To designate or re-designate an enterprise zone under ORS 285C.065 or 285C.250:

(1) The process begins with the Sponsoring Government(s) sending a formal advisory to the Department of its intent to re-/designate. This may happen at any time for a new designation, but for concurrent re-designation, the local zone sponsor shall timely provide the advisory under ORS 285C.074 after January 1 (but by May 16 at the very latest), preceding July 1 when the existing zone will have Terminated-by-Statute.

(2) The Department will respond promptly to such an advisory, which if by telephone will be memorialized at least through email, consulting with the Sponsoring Government(s) about:

(a) The utility, impacts and responsibilities of re-/designating and having an enterprise zone;

(b) Steps to re-/designate a zone, including but not limited to formally sending notice to and consulting with local taxing districts, after this consultation by the Department has taken place;

(d) Economic development needs of the Sponsoring Government(s)’ area and possible assistance in identifying evidence of a need for economic development for defining the local area;

(e) Prohibitions in OAR 123-650-4900(2); and

(f) Other matters as appropriate or necessary.

(3) Not less than 45 days after advising the Department, the Sponsor Governments may submit the enterprise zone re-/designation electronically, as described in OAR 123-650-4100.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.065, 285C.067, 285C.074, 285C.078 & 285C.250
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4100 Temporary rule language in effect until 12/01/2026. Documentation Pursuant to Zone Designation

For purposes of complying with ORS 285C.074, a zone sponsor shall submit the following documentation to the Department to designate or re-designate an enterprise zone under ORS 285C.065 or 285C.250 or a zone or city for electronic commerce under ORS 285C.095 or 285C.100, respectively:

(1) A completed “Enterprise Zone Designation Local Submission Form” available from the Department’s website on the Enterprise Zone program webpage.

(2) Contact information and the name of the zone based on place names or common geographic terms (which if the same as a previous or terminating zone’s name will include a “II, III, IV, …” suffix, but only in the context of this submission);

(3) Identification of the Sponsoring Governments and consenting jurisdictions for purposes of OAR 123-650-0500, and hotel/resort elections by city or county sponsors, including but not limited to enclosing or attaching an executed copy of the resolution duly adopted by the governing body of each Sponsoring Government according to OAR 123-650-4800(1) and (2) and of any consenting jurisdiction, under the charter, by-laws or ordinances of the city, port or county;

(4) Evidence of timely notice and consultation with local taxing districts consistent with OAR 123-650-5000 to 123-650-5200;

(5) Evidence of the establishment of a school support fee rate with every school district that has territory inside the zone boundary consistent with OAR 123-650-5300;

(6) Map and clear designation of the zone boundary, size and dimensions consistent with OAR 123-650-1500;

(7) Data and statistics applicable to the Local Area of the zone that provide evidence demonstrating a need for economic development consistent with OAR 123-650-4200 and the criteria of ORS 285C.090(1).

(8) Information regarding additional zone attributes such as hotel, motel or destination resort operations election under ORS 285C.070, eligible industries, establishment of pilot program allowing for eligible business activities, 10-year extended exemption periods, and alternative performance criteria thresholds allowable under OAR 123-674-0300(2)(b) (rather than standard employment thresholds).

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.060, 285C.065, 285C.066, 285C.067, 285C.074, 285C.135, 285C.160 & 285C.200
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 29-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 15-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4200 Temporary rule language in effect until 12/01/2026. Mandatory Economic Development Need for Zone Designation

(1) For purposes of designation or re-designation of an enterprise zone, the enterprise zone must be located in a Local Area in which the cities, counties or ports designating the enterprise zone provide satisfactory evidence demonstrating to the Department a need for economic development in the Local Area.

(2) The zone sponsor(s) must determine the geographic area of the Local Area in association with the enterprise zone boundary to establish applicable evidence to demonstrate a need for economic development to support the enterprise zone designation. The evidence submitted to the Department may be quantitative or qualitative data points or a combination. Evidence may include but is not limited to data and statistics that is sponsor-collected survey or economic data; non-sponsor data collected by a city, county, state, or tribe, or other economic development partner; and data collected through the most recent 5-year American Community Survey data collected by the U.S. Census Bureau.

(3) The zone sponsor(s) demonstrates a need for economic development in the Local Area by providing satisfactory evidence of one or more of the economic development need conditions listed in 285C.090(1):

(a) Economic transition or restructuring, including but not limited to significant job losses, industry contraction, supply chain realignment, automation impacts and shifts in regional economic specialization, and lack of high-wage jobs in the Local Area.

(b) The presence of underutilized, vacant or redevelopment-ready industrial or employment land, including brownfields, legacy industrial sites and properties requiring modernization to support productive use.

(A) “Redevelopment-ready industrial” means land that can be developed within one year of a permit application or request for service extension that may be zoned for industrial use.

(B) “Employment land” means land designated to accommodate a broad range of commercial and industrial uses.

(C) "Brownfield" means real property where expansion or redevelopment is complicated by actual or perceived environmental contamination as defined in ORS 285A.185(1).

(D) “Properties requiring modernization to support productive use” means land sites that do not create significant value, income or goods, due to missing or inadequate physical, infrastructural, regulatory, or environmental components. Examples include, but are not limited to, sites that:

(i) Lack reliable or adequate broadband, fiber, or modern connectivity;

(ii) Lack reliable or adequate water or wastewater;

(iii) Have inadequate access, including roads;

(iv) Have unfavorable zoning regulations or fail to meet regulatory or operational needs, including but not limited to code compliance; or

(v) Lack adequate energy supply.

(c) Alignment with adopted local, regional or statewide economic development strategies, land-use plans, infrastructure plans, workforce strategies or climate and energy transition goals, where enterprise zone designation would materially advance implementation.

(d) Demonstrated opportunity to:

(A) Support emerging, traded sector or innovation-driven industries;

(B) Retain, reinvest in or modernize existing industries or facilities; or

(e) Demonstrated a performance-based development approach, including measurable objectives related to capital investment, wages, workforce development, retention or modernization outcomes, productivity improvement, redevelopment outcomes or other economic performance indicators.

(A) Other economic performance indicators will be considered based on proposals from zone sponsors to the Department. Proposed indicators must align with an established local or regional economic strategy.

(B) A performance‑based development approach must document baseline (existing) performance levels for each selected measurable outcome and must establish target performance thresholds.

(f) Community-defined indicators of economic need or development potential. Examples of community-defined indicators of economic need or development potential may include unemployment rate, poverty rate, median family income, job creation, or vacancy rates for industrial or commercial spaces in the Local Area.

(4) If a zone sponsor is pursuing a designation or redesignation based on multiple economic development need criteria, the zone sponsors shall provide sufficient evidence and documentation to the Department for each will need to provide sufficient evidence and documentation for all criteria.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.074 & 285C.090
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4400 Temporary rule language in effect until 12/01/2026. Documentation with Enterprise Zone Amendments

During the duration that an enterprise zone is designated, a sponsor of the zone may change the zone boundary. A zone change is not final until a positive determination has been made by the Department, and the zone sponsor (including with any new cosponsor) making the change shall provide documentation regarding the requested amendment to the Department (electronically as desired) for the Department to make its determination. For purposes of boundary changes in accordance with ORS 285C.115, the zone sponsor shall submit the documentation to the Department (electronically as desired) as required by ORS 285C.117.

(1) As well as submitting the following necessary information, materials, items or data, respective to:

(a) The submitter–contact for the sponsor, relevant background about the amendments, and any change in the zone name;

(b) Identifying every current and new (co)sponsor or consenter, along with an executed copy of the resolution adopted by the governing body of each sponsoring jurisdiction according to applicable provisions of OAR 123-650-4800(2), as well as any (re-)consenting jurisdiction, consistent with the charter, by-laws or ordinances of the city, port or county;

(d) Zone boundary, size and dimensions in accordance with OAR 123-650-1500;

(e) Data, statistics and so forth on social and economic conditions for OAR 123-650-4500; and

(f) Other issues, as necessary or appropriate, in OAR 123-650-4600.

(2) During the duration that an enterprise zone is designated, a sponsor of the zone may amend eligible industries in the zone in accordance with ORS 285C.135(1)(b), by completing the following documentation and submitting to the Department:

(a) The zone sponsors shall adopt a resolution as described in OAR 123-650-4800 identifying the industry sector that is a priority industry that is to be added as eligible within the enterprise zone or the industry sector that is to be no longer eligible within the enterprise zone.

(b) Submit documentation substantiating that the industry sector is a priority industry under a local or regional economic development strategy for the local area served by the enterprise zone to the governing body to review before the governing body adopts a resolution under (2)(a) of this section.

(3) During the duration that an enterprise zone is designated, a sponsor of the zone may amend business activities allowed to qualify in the zone by establishing a pilot program within the zone in accordance with ORS 285C.135(b), by completing the following documentation to the Department for review and an approval decision:

(a) The zone sponsors shall adopt a resolution as described in OAR 123-650-4800, identifying a business activity described in ORS 285C.135(2) that a business firm may be engaged in to qualify as an eligible business firm.

(b) Submit documentation demonstrating that the business activity proposed to be allowed under the pilot program will provide substantial community benefit, innovation or alignment with local economic development goals as described in OAR 123-662-2100 to the governing body to review before the governing body adopts a resolution under (3)(a) of this section.

(4) During the duration that an enterprise zone is designated, a sponsor of the zone may amend the allowable extended exemption period as described in ORS 285C.160(2)(b)(B). The zone sponsors shall adopt a resolution as described in OAR 123-650-4800.

(5) During the duration that an enterprise zone is designated, a sponsor of the zone may establish alternative performance criteria thresholds allowable under ORS 285C.200(2)(b) as described in OAR 123-674-0300(2)(b). The zone sponsors shall adopt a resolution as described in OAR 123-650-4800.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, ORS 285C.066, ORS 285C.115, ORS 285C.117 & ORS 285C.200
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4500 Economic Conditions for Areas Added by Boundary Changes

Under ORS 285C.115(2)(c), an area may be added to an enterprise zone only if it and adjoining residential areas are economically comparable to the original enterprise zone:

(1) Economic statistics or data for the original enterprise zone and an area to be added shall be either:

(a) From a given data source as most recently available; or

(b) From the time of the latest re-/designation of the zone based on the data source used at the time for purposes of ORS 285C.090.

(2) As part of the boundary change documentation, general commentary shall suffice for this issue if it is readily apparent that any area added to the zone:

(a) Is virtually devoid of and geographically removed from residential areas; or

(b) Contains and borders only residential areas with signs of economic blight or a preponderance of markedly low-income households.

(3) If circumstances are less plain than in section (2) of this rule, then the documentation shall include a suitable comparison based on one or more economic measures of the original enterprise zone to Census Statistical Units that contain, overlap or appropriately abut areas added to the zone.

(4) The comparison in section (3) of this rule must show that such Census Statistical Units in aggregate, based on the most recently available data, have:

(a) Less than 25 percent of their land zoned or used for residential development; or

(b) Generally the same or a lower household or personal income, or a higher unemployment rate, or otherwise equivalent or more severe economic conditions, compared to the original enterprise zone.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.115 & 285C.117
OBDD 9-2016, f. & cert. ef. 9-16-16
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4600 Additional Issues with Boundary Changes

With respect to any enterprise zone boundary change under ORS 285C.115:

(1) Usable land described in section (2) of this rule must comprise:

(a) At least 25 percent of what is added (except as specially allowed by the Department); and

(b) None of what is removed (except in the case of a concurrent boundary change or re-/designation that would presently place such land in another enterprise zone).

(2) Usable land for purposes of section (1) of this rule includes sites with qualities respective to eligible business firms under ORS 285C.130, such as being:

(a) Zoned outright for uses germane to such firms consistent with an acknowledged comprehensive land use plan or expected amendments to the plan;

(b) Free of serious impediments to development and use due to cultural or environmental concerns or regulations;

(c) Served or realistically serviceable with infrastructure, road access, utilities and so forth that are at least potentially adequate for such firms’ operations; and

(d) Vacant or physically available for substantial new business occupancy, expansions or improvements.

(3) The changes must retain (never remove):

(a) One half of the land or actual area comprising the original enterprise zone; or

(b) Any site identified as the location for proposed qualified property in an application for authorization that is or will be approved and was submitted before the boundary change took effect, and that is neither inactive under ORS 285C.165 nor fully utilized for exemptions under ORS 285C.175.

(4) If a site containing (proposed) operations or qualified property of an eligible business firm described in subsection (3)(b) of this rule, as well as any qualified business firm, is nevertheless removed by a boundary change, then such a firm shall enjoy the same protection under ORS 285C.245(5) for that location, as if it were inside a terminated enterprise zone, in accordance with OAR 123-650-9500 (but not OAR 123-650-9600).

(5) An enterprise zone as amended must still adhere to OAR 123-650-0500 to 123-650-1100. For example, with respect to OAR 123-650-0700, if modification of a local, state or federal definition or delineation causes a previously existing regional or metropolitan urban growth boundary to intersect an existing rural zone, subsequent changes to that zone boundary may not add any further area that was within the former regional or metropolitan urban growth boundary as it existed beforehand.

(6) A city, port or county that previously consented to include territory inside the zone does not need to be involved with a boundary change that adds area solely outside its jurisdiction, but it does need to consent again in order for any more of its territory to be included in the zone.

(7) Neither such a change nor any comparable procedure allows a sponsoring city, port or county government, to:

(a) Make hotel/resort businesses eligible unless such firms are eligible in the zone already, even in the case of a new city or county cosponsor that is joining the zone; or

(b) Renounce, rescind or terminate its existing sponsorship and inclusion in the zone, which is possible only by termination of the entire zone under ORS 285C.245(2) or by dissolution of the jurisdiction.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.066
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.066, 285C.115 & 285C.117
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4800 Temporary rule language in effect until 12/01/2026. Local Resolutions and Zone Options

For purposes of city, port or county resolutions under this chapter, including but not limited to resolutions to designate, re-designate or amend an enterprise zone; and resolutions to enter into an agreement with a business firm for an exemption for qualified property:

(1) In the case of designation or re-designation, the resolution by a Sponsoring Government shall be adopted only:

(a) After establishment of school support fee rate(s) in OAR 123-650-5300; and

(b) At least seven days after the meeting described in OAR 123-650-5100.

(2) Resolutions adopted pursuant to this chapter shall:

(a) Acknowledge all other cosponsoring parties to the re-/designation or boundary change, if any;

(b) Declare that the sponsor will (jointly) fulfill duties under ORS 285C.050 to 285C.250, including but not limited to observing ORS 285C.105 in accordance with OAR 123-668;

(c) Clarify that the zone does not compromise or override prevailing zoning, regulatory and permitting ordinances, processes or restrictions, or affect acknowledged comprehensive plans for land use;

(d) As deemed significant or appropriate by the sponsoring government, affirm goals in having the zone, recount zone history, underscore key characteristics of the re-/designation or boundary change, or report actions taken for purposes of public involvement, including but not limited to the nature and outcome of communication or interaction with local taxing districts; and

(e) Stipulate any election or restriction for hotel/resort eligibility under ORS 285C.070 by cities and counties, so that a business operating a hotel, motel or destination resort is eligible under ORS 285C.135(5)(c) in the enterprise zone or in restricted parts of the zone, for which:

(A) Any such election or restriction must be reflected in the resolution(s) (jointly) adopted by each sponsoring city or county and by any consenting city or county affected by a restriction.

(B) Any restriction makes such businesses eligible in those parts of the zone throughout the incorporated area of the city or unincorporated area of the county, to which the restriction pertains, which may be a city or county merely consenting to the zone.

(C) With a boundary change, a positive hotel/resort election or restriction may not be made, but the jurisdiction of a city or county newly joining or consenting to an enterprise zone may be excluded from an existing hotel/resort election, and any such negative restriction may not be revised once the boundary change takes effect.

(D) In the case of re-/designation, cities and counties may (jointly) revise an election, restriction or lack of one, regardless of what is in the resolution(s) of re-/designation, by resolution(s) adopted not more than six months after the effective date of re-/designation.

(E) A prior election or restriction for hotel/resort eligibility does not carry over to any re-designation, such that hotel/resorts are ineligible (based on the date of application for authorization) throughout any newly re-designated zone without a positive election or restriction as described in this subsection.

(f) If opted for, identify priority industry(ies) in local or regional economic development strategies as authorized by ORS285C.135(1)(b).

(g) If opted for, allow by agreement an exemption period up to 10-years under ORS 285C.160(2)(b)(B) for a business firm that demonstrates their project involves substantial capital investment, regional economic impact or alignment with local development goals as described in OAR 123-674-0500(6).

(h) Zone sponsors may establish in the resolution certain minimum standards including but not limited to capital investment, economic contribution, or local development requirements the business firm is required to meet to be eligible for the allowed an extended abatement period.

(i) If opted for, establish a pilot program to allow for eligible business activities under ORS 285C.135(3)(b) and consistent with OAR 123-662-2100.

(A) The resolution shall identify the allowable business activities that are described in 285C.135(2) that would otherwise be ineligible.

(B) The resolution must establish that the allowed business activity will provide a substantial community benefit, innovation or alignment with local economic development goals as described in OAR 123-662-2100.

(i) Pilot program duration

(ii) Limitations of extended exemption period

(iii) Any other local requirements related to authorization and approval

(j) If opted for, zone sponsors may establish zone-specific minimum thresholds for alternative performance criteria as described in OAR 123-674-0300(2)(b).

(3) The sponsor of an enterprise zone that has an existing hotel/resort election may at any time revoke that election in its entirety or in a particular city or county jurisdiction (thereby effecting a restriction elsewhere), irreversibly for the remainder of the enterprise zone’s current period of designation, but:

(a) For a zone with two or more cosponsors, the revocation must be consistently expressed in resolutions adopted by all of them, including but not limited to any port; and

(b) Copies of the resolution(s) of such revocation must be submitted to the Department to establish its effective date in terms of subsequent applications for authorization by relevant business firms.

History

Statutory/Other Authority: ORS 285A.075, ORS 285C.060(1) & ORS 285C.067(2)
Statutes/Other Implemented: ORS 285C.065, ORS 285C.070, ORS 285C.074, ORS 285C.105, ORS 285C.115 & ORS 285C.117
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 9-2016, f. & cert. ef. 9-16-16
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-4900 Temporary rule language in effect until 12/01/2026. Agency Determinations

The Department shall thoroughly review the documentation submitted with an enterprise zone designation, re-designation or zone amendment including but not limited to a boundary change, as described in OAR 123-650-4100 or 123-650-4400, and shall notify the submitter as soon as possible of the determination under ORS 285C.074 or 285C.117 or ORS 285C.135, such that:

(1) Subject to procedural matters’ being in order and satisfaction of statutory requirements according to applicable parts of these administrative rules, the Department shall issue a notice of positive determination, which will establish salient features of the (amended) enterprise zone, including but not limited to hotel/resort eligibility, as well as the date that the re-/designation or boundary change takes effect, which shall be:

(a) The date that the last resolution of consent or sponsorship was adopted for a designation;

(b) July 1 in the case of concurrent re-designation under ORS 285C.250 if the last sponsoring or consent resolution was adopted on or before June 30;

(d) For any resubmission pursuant to section (3) of this rule:

(A) The date coinciding with the Department’s receipt of a complete resubmission (in terms of all items needing to be revised, modified or redone), inasmuch as the Department deems the extent of necessary revisions or the amount of time that has elapsed to have been significant; or

(B) The date of adoption of the last applicable resolution replacing or supplementing prior resolutions.

(2) The determination is otherwise negative and the enterprise zone or any amendment to the enterprise zone does not take effect, including but not limited to cases otherwise prohibited in accordance with OAR 123-650-0500 to 123-650-0700 or where:

(a) Documentation is inaccurate, inapplicable, incomprehensible, or insufficiently current including but not limited to section (4) of this rule;

(b) The enterprise zone or an amendment encompasses area in any existing enterprise zone that will not have been Terminated-by-Statute or removed by another boundary change before the requisite effective date; or

(c) A Sponsoring Government or new cosponsor is a city, port or county that sponsored an enterprise zone terminated early by order of the Director according to OAR 123-650-9100(1)(b) within the past 10 years by the time of the requisite effective date, other than a county or port if a port/city also sponsored the terminated zone and none of the new enterprise zone area was inside that terminated zone.

(3) The Department shall promptly issue a formal explanation (at least by email) to the Sponsoring Government(s) or zone sponsor subject to a negative determination, regarding unmet requirements or deficiencies with documentation, as well as what might be done for resubmission that entails either:

(a) More or less minor revisions or additions to documentation, with which the Department may assist, and for which a relatively quick resolution would allow the re-/designation or boundary change to take effect as described in subsection (1) to (c) of this rule; or

(b) Fundamental modifications to the re-/designated or amended zone or its associated documentation, which could also necessitate redoing otherwise faultless steps or documentation with respect to the time limits in section (4) of this rule.

(4) Relative to when complete documentation is re/submitted to the Department or the effective date in section (1) of this rule, whichever is later, the following are not acceptable for purposes of a positive determination:

(a) Economic data, statistics and so forth that have been superseded by the release or availability of the very same but newer/annually updated data or statistics;

(b) The notice to local taxing districts and any consequent consultative activities described in OAR 123-650-5000 to 123-650-5500, if the notice was sent more than a year prior;

(c) Any sponsoring or consent resolution older than nine months in the case of a boundary change or six months in the case of zone re-/designation; or

(d) Documentation for school support fee that does not (newly) re/establish the fee rate with any school district inside the enterprise zone after the advisory in OAR 123-650-4000 and before adoption of a resolution by any Sponsoring Government.

(5) For zone re-/designation, nothing in this rule overrides that the actions in subsections (4)(b) and (c) of this rule and related steps must commence in due order only after the advisory to and consultation with the Department under ORS 285C.074 and 285C.078, which shall occur for re-designations only within six months of when the zone will be Terminated-by-Statute.

(6) For the purposes of waivers or pilot program authorized by zone sponsors described in OAR 123-662-2100, zone sponsors must submit the required documentation under OAR 123-650-4400 and OAR 123-650-4800 to the Department for review and approval.

(a) The Department will review the submitted documentation to ensure that all relevant procedural requirements described in OAR 123-662-2100 are addressed satisfactorily. If all requirements are satisfied, the Department will approve the waiver or pilot program as authorized by resolution. Approval issued by the Department will confirm requirements were satisfied and the effective date of the approved waiver or pilot program.

(b) If the Department finds that the provided documentation is unsatisfactory, the Department shall issue a prompt notice to the zone sponsors with details regarding unmet requirements or deficiencies with documentation, as well as what might be done for resubmission.

(d) Authorizations for business firms seeking exemption under the allowable business activities authorized by waiver or pilot program under ORS 285C.135(3)(b) cannot be approved until the Department issues an approval for the waiver or pilot program.

History

Statutory/Other Authority: ORS 285A.075, ORS 285C.060(1), ORS 285C.066 & ORS 285C.067(2)
Statutes/Other Implemented: ORS 285C.060, ORS 285C.065, ORS 285C.066, ORS 285C.067, ORS 285C.070, ORS 285C.074, ORS 285C.078, ORS 285C.090, ORS 285C.115, ORS 285C.117 & ORS 285C.250
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 9-2016, f. & cert. ef. 9-16-16
OBDD 15-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-650-5000 LOCAL TAXING DISTRICTS — Regular Designation Notice

(1) The designation or re-designation of an enterprise zone under ORS 285C.065 or 285C.250 must entail notice to and consultation with local taxing districts that:

(a) Formally commences only after the Department consults with the Sponsoring Government(s) as described in OAR 123-650-4000; and

(b) Takes place in due order before subsequently submitting documentation to the Department.

(2) The notice:

(a) Must go to each taxing district (including but not limited to any municipal corporation or service district listed under ORS 198.010 and 198.180) that levies or has authority to levy ad valorem taxes on property within the boundary of the zone to be designated, irrespective of the zone area as measured for purposes of OAR 123-650-1000(3);

(b) Shall be copied to the county assessor; and

(c) Need not be sent to the Department or to any taxing district that is a Sponsoring Government, subdivision thereof, or a service district, urban renewal district, or the like that effectively has the same board or governing body as a Sponsoring Government.

(3) The Sponsoring Government(s) must send the notice at least 21 calendar days before the meeting in OAR 123-650-5100, and the notice shall include, but is not limited to:

(a) An invitation for representation from each district;

(b) An established meeting place, date and time, the scheduling of which should be coordinated with district officials known to have special interest in relevant issues;

(c) Brief background about the reasons for seeking an enterprise zone and the potential for (limited duration) exemption(s) from taxes on future business property inside the zone boundary (subject to certain requirements);

(d) Probable timeline for consideration of resolutions for re-/designation by the Sponsoring Government(s) even if lacking exact dates;

(e) Solicitation for comments on the proposed zone to be directed at a Sponsoring Government; and

(f) Contact details for making such comments or for receiving further information.

(4) The Sponsoring Government(s) must furnish the Department with the following as part of submitted documentation:

(a) Evidence of the notice having been timely sent, including but not limited to:

(A) A list of contact names and mailing addresses for all applicable taxing districts; and

(B) A (template) copy of the notice directed at such taxing districts in accordance with section (3) of this rule; and

(b) Meeting minutes or summary and any final materials resulting from related consultative activities, as well as written comments received in response to the notice from any relevant taxing district.

(5) A taxing district’s objection to or lack of support has no bearing on the Department’s determination under ORS 285C.074 or on the enterprise zone’s operation or tax abatements for business firms.

(6) The tasks stipulated in this rule shall not discourage or replace other local efforts and actions to provide/elicit public information, commentary or involvement, as circumstantially appropriate, or as required by local law, policy, custom or practice.

(7) Copies of items listed in subsection (4)(a) of this rule shall also be furnished to the Special Districts Association of Oregon (Attn: Government Affairs).

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.060, 285C.065, 285C.067, 285C.074, 285C.078 & 285C.250
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-5100 Public Meeting for Regular Designations

For purposes of ORS 285C.067, the Sponsoring Government(s) shall conduct a public meeting (though not necessarily hold a public hearing or issue a public notice for the meeting):

(1) That occurs not less than seven days before the adoption of any resolution of designation or re-designation by a Sponsoring Government.

(2) To which the Sponsoring Government(s) send staff or community partners, who are directly involved with the re-/designation and knowledgeable about the potential of business development in the proposed zone, as well as their elected or executive officials as feasible and appropriate.

(3) At which the Sponsoring Government(s):

(a) Make available and reviews draft copies of a map of the proposed zone boundary and other such materials related to the re-/designation;

(b) Recognize for the record any written commentary already received from a district;

(d) Have the proceedings transcribed or recorded in some manner.

(4) That involves discussion of relevant issues and may address follow-up steps for analysis or further consultation, as well as plans for adopting resolutions and completing the re-/designation.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.060, 285C.065, 285C.067, 285C.074 & 285C.250
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-5200 Consultations Generally with Taxing Districts

(1) In anticipation of or subsequent to the meeting described in OAR 123-650-5100, or as otherwise warranted with an enterprise zone designation, re-designation or boundary change, the Sponsoring Government(s) or zone sponsor:

(a) May communicate, confer or interact with one or more local taxing districts, including but not limited to additional public or nonpublic meetings or other means of eliciting feedback and dialogue with districts.

(b) Shall respond within 10 business days to a local taxing district’s formal request and make good faith efforts to fulfill any such a request for a special (one-on-one) meeting or for written answers to specific questions.

(c) Shall assist one or more districts, as requested, to estimate or better understand short or long-term effects on public revenues and service demands under particular assumptions or potentialities about enterprise zone development.

(d) May explore how to effectively resolve relevant, outstanding issues through local government permitting procedures or development standards affecting eligible business firms in the zone, including but not limited to design review, conditional use permits, comprehensive land use planning or zoning ordinances.

(2) As a consequence of consultative activities with local taxing districts, the Sponsoring Government(s) or zone sponsor:

(a) May establish arrangements or agreements with one or more districts, contingent on the zone re-/designation or boundary amendment.

(b) Shall describe any such arrangements in materials submitted to the Department, including but not limited to follow-up steps, timelines or outstanding points still subject to refinement or finalization.

(c) May formally execute and document any such arrangement or agreement, but any description of verbal pledges or understandings do not themselves create or represent an obligation by the zone sponsor.

(3) This rule does not create any authority over property tax collection or any right to obligate or burden the county assessor.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.060, 285C.067, 285C.074, 285C.115 & 285C.117
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-5300 Fee Rates to Support Oregon Schools

(1) A positive determination by the Department of any designation or re-designation of an enterprise zone under ORS 285C.074 depends on setting a rate or rates for support fees with K–12 school districts:

(a) As part of requisite consultations with local taxing districts;

(b) Consistent with OAR 123-668-4000 and 123-668-4100; and

(c) Such that the submission to the Department under ORS 285C.074(1) must include formal documentation of any or all established rate(s) with each and every common or union high school district that:

(A) Provides elementary and secondary education (exclusive of community college, educational service or any other district); and

(B) Levies property taxes in a tax code area anywhere within the boundary of the enterprise zone.

(2) Establishment of the rate or rates in section (1) of this rule must:

(a) Follow advisory in OAR 123-650-4000; and

(b) Precede adoption of any resolution that designates or re-designates the zone by a Sponsoring Government.

(3) Regardless of previous rate‑setting with a school district according to this rule or OAR 123-668-4000(2)(b), any re-designation must entail updated documentation even if maintaining the same rate.

(4) The respective rate shall apply exclusively to any agreement entered into between the zone sponsor and a business firm under ORS 285C.160 or 285.403(4) on or after the effective date of designation or re-designation.

(5) This rule does not control or affect any designation under ORS 285C.085, 285C.095, 285C.100, 285C.306 or 285C.353 or any boundary change under ORS 285C.115, notwithstanding the requirement for a school support fee rate in any agreement between the zone sponsor and a business firm under ORS 285C.162 and 285C.405.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.067, 285C.074, 285C.160, 285C.403 & OrLaws 2023 ch. 298 §55
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-650-5500 Notice for Boundary Changes

A change to an existing enterprise zone boundary must entail notice to local taxing districts before the submission under ORS 285C.117 to the Department that generally conforms to that described in OAR 123-650-5000, except:

(1) The notice goes not only to each taxing district in any area to be added, but also to those inside the entire, current zone area (aside from any jurisdiction joining the zone).

(2) The notice shall be sent at least 21 calendar days before adoption of the requisite resolution by the governing body of the sponsoring county. If there is no sponsoring county, notice must precede the resolution by every sponsoring city or port by 21 calendar days.

(3) There is no mandatory public meeting or other type of special consultation, but circumstances such as the addition of a new cosponsor or of extensive areas could demand further communication along the lines of OAR 123-650-5200.

(4) The submission to the Department is not complete without inclusion of relevant items listed in OAR 123-650-5000(4).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.115 & 285C.117
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-9100 ZONE TERMINATION — Events and Timing

For purposes of these administrative rules and designations or re-designations of enterprise zones by city, port or county governments:

(1) The official existence of such an enterprise zone concludes for one of three reasons:

(a) "Terminated-by-Statute” (OAR 123-650-0100), effectively at 12 midnight (Pacific Time) on July 1;

(b) Early Termination, by order of the Director under ORS 285C.245(1)(b) and (2) or (3), prior to subsection (a) of this section, either by sponsor request or for cause, for which the Director’s order shall prescribe the effective date of termination; or

(c) Programmatic Sunset, under ORS 285C.240(1)(c) and 285C.255(1)(c) at 5:00 PM (Pacific Time) on June 30, 2032, prior to subsection (a) or (b) of this section.

(2) Any enterprise zone timely and concurrently re-designated under ORS 285C.250 as described in OAR 123-650-4900(1)(b) is not again Terminated-by-Statue until, in effect, 11 years after its July-1 designation, except as preempted by subsection (1)(b) or (c) of this rule.

(3) Following the termination of an enterprise zone:

(a) The local policies adopted by the zone sponsor under ORS 285C.105 or any other applicable law shall remain in force as they were at the time of termination.

(b) The sponsor of the terminated zone may appoint a replacement as needed for the local zone manager, if the position previously held by the local zone manager lacks qualified personnel.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.245, 285C.250 & 285C.255
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 11-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2015, f. & cert. ef. 11-12-15
OBDD 13-2012, f. & cert. ef. 8-15-12
OBDD 23-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-650-9500 Business Tax Abatements and Zone Termination

In relation to OAR 123-650-9100(1) when an enterprise zone terminates:

(1) This rule defines the effect for exemptions on business property under:

(a) ORS 285C.175 consistent with OAR 123-674 for standard enterprise zone tax abatement (hereinafter “SEZ”); or

(b) ORS 285C.409(1) consistent with OAR 123-690 for long-term rural enterprise zone facility tax abatements (hereinafter “LRZ”).

(2) Regardless of the reason for termination, if the enterprise zone still exists on January 1 of an exemption year:

(a)(A) An SEZ exemption on qualified property in that year shall continue as it otherwise would for the remainder of that exemption period; and

(B) The qualified business firm may claim exemption(s) on additional property, as otherwise allowed under ORS 285C.255(3), pursuant to the same authorization under ORS 285.140; and

(b) Any exemption on an LRZ facility in that year shall continue as it otherwise would until the final year under ORS 285C.409(1)(c), as provided under ORS 285C.403(4)(a).

(3) Regardless of the reason for termination, in the case of any approved, outstanding application for authorization under ORS 285C.140 or for certification under ORS 285C.403:

(a) The authorized business firm shall receive SEZ exemption(s) consistent with subsection (2)(a) of this rule as it otherwise would, provided that:

(A) The authorization was still active under ORS 285C.165 according to OAR 123-674-3700, as of the effective date of the enterprise zone’s termination;

(B) Proposed investments pursuant to the application are completed consistent with OAR 123-650-9700; and

(C) The authorization has not expired because an exemption is not successfully claimed on qualified property for a year beginning on January 1 not more than:

(i) Two full calendar years after termination; or

(ii) Three full calendar years after termination if the total cost of qualified property by that year equals or exceeds $25 million.

(b) The certified business firm shall receive an LRZ exemption consistent with subsection (2)(b) of this rule as it otherwise would, provided that:

(A) Proposed investments pursuant to the application are completed consistent with OAR 123-650-9700; and

(B) The certification has not expired because an exemption is not successfully claimed on facility property for a year beginning on January 1 not more than three full calendar years after termination.

(4) For an enterprise zone Terminated-by-Statute or subject to early termination (but not programmatic sunset):

(a)(A) If the zone sponsor or county assessor receives an application for authorization or certification before the effective date of termination, they may approve the application as normally allowed under ORS 285C.140 or 285C.403 after the zone’s termination;

(B) Though, for purposes of LRZ certification, the agreement under ORS 285C.403(4) must have been executed, even if not yet in effect, before the date of the zone’s termination;

(b) Approval must precede January 1 at the beginning of the SEZ or LRZ exemption period; and

(c) An authorized or certified business firm shall receive SEZ or LRZ exemption as it otherwise would subject to satisfying paragraphs (3)(a)(B) and (C) or subsection (3)(b) of this rule.

(5) Except as allowed under ORS 285C.245(6) or (8), consistent with OAR 123-650-9600(1), in the case of a business firm that is also qualified or approved in the terminated enterprise zone according to section (2) or (3) of this rule under another authorization or certification:

(a) A business firm described in section (4) may not reapply or be reapproved; and

(b) An application for authorization or certification received after the zone’s termination may not be accepted or approved for an SEZ or LRZ exemption.

(6) A year of exemption on qualified property under ORS 285C.170 (construction in process) is unaffected by the zone’s termination on or after January 1 of that year, whatever the reason, but no such exemption is allowed in any further year.

(7) For purposes of programmatic sunset of all enterprise zones:

(a) The following are unaffected:

(A) Ongoing use of exemptions from property taxes or any approval in a terminated zone consistent with subsection (2) or (3) of this rule; or

(B) Continuing use of OAR 123-650-9600 under ORS 285C.245(6) or (8) in a previously terminated zone.

(b) In the case of unapproved applications for authorization or certification received by the zone sponsor before the effective date of termination:

(A) The zone sponsor may not accept any such application after June 29, 2032;

(B) The application must be fully approved no later than June 30, 2032, in full compliance with provisions under ORS 285C.140 or 285C.403, including but not limited to any agreement under ORS 285C.160:

(i) Even if the zone had terminated previously; and

(ii) Pursuant to a preauthorization conference under ORS 285C.140(4) and (5) that is summarily dispensed with, as necessary;

(D) If an application is not approved in accordance with this subsection, then the business firm is not authorized or certified, and the sponsor or county assessor shall have effectively failed or refused to authorize or certify the firm under ORS 285C.140(9) or 285C.403(7) unless doing so was infeasible.

(8) Notwithstanding ORS 285C.115(2)(b), a business firm that has the site of its exempt property or proposed investment in an enterprise removed by a boundary change (whether inadvertently or not) has the same rights and privileges in sections (2) to (6) of this rule based on the effective date of the boundary change, as if the zone had terminated.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.170, 285C.175, 285C.245, 285C.255, 285C.403, 285C.408 & 285C.409
OBDD 30-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-650-9600 Later Approval and Tax Abatement in a Terminated Zone

Under ORS 285C.245(6) or (8) after termination of an enterprise zone regardless of the reason in OAR 123-650-9100(1):

(1) For a business to receive exemption pursuant to section (2) of this rule inside the former zone’s boundary:

(a) On the effective date of termination:

(A) In the case of SEZ as described in OAR 123-650-9500(1)(a), the firm must be:

(i) Qualified as described in OAR 123-650-9500(2)(a); or

(ii) Authorized consistent with OAR 123-650-9500(3)(a)(A).

(B) In the case of LRZ as described in OAR 123-650-9500(1)(b), the firm must be certified, regardless of already receiving an exemption on the facility.

(b) If a business firm is only authorized or certified but not qualified or receiving an exemption on the effective date of termination, then no further application for authorization or certification is allowed until provisions of OAR 123-650-9500(3)(a)(B) and (C) or (b), respectively, are fulfilled.

(2) Exclusive to the exemption program in subsection (1)(a)(A) or (B) of this rule, property owned or leased by a business firm is exempt under either ORS 285C.175 or 285C.409(1) in the same enterprise zone, only if:

(a) Not more than 10 years from the effective date of the zone’s termination, the firm submits a complete application for authorization or for certification under ORS 285C.140 or 285C.403, respectively;

(b) The property will be located entirely within the boundaries of the terminated zone, as they existed at the time of termination, and not inside any currently designated enterprise zone;

(A)(i) Approved by the local zone manager, or absent an appointed zone manager, by a suitable representative or formal action of the zone sponsor, or by the Department; and

(ii) Approved by the county assessor; or

(B) Allowed on magisterial or judicial appeal.

(d) New construction, reconstruction, modifications or installations of property pursuant to the application commence no later than June 30 following the last year of the firm’s final outstanding exemption in the zone—that is, before the end of the very last tax year in which SEZ qualified property or an LRZ facility, respectively, is still exempt;

(e) Proposed investments pursuant to the application are completed consistent with OAR 123-650-9700;

(f) Timely filings and other applicable procedures are properly undertaken with the county assessor;

(g) The authorized or certified business firm and all of its property have not been disqualified in the terminated zone under ORS 285C.245(7) or (9); and

(h) The firm complies with any applicable local policy or requirement according to OAR 123-668, as well as ORS 285C.050 to 285C.250 or 285C.400 to 285C.420, consistent with OAR 123-674 or 123-690.

(3) For purposes of exemption under ORS 285C.175 (SEZ) pursuant to section (2) of this rule:

(a) Exemption under ORS 285C.170 is not allowed.

(b) Before final action in paragraph (2)(c)(A) of this rule, the sponsor of the terminated zone may adopt resolution(s) for a waiver under ORS 285C.155 or enter into an agreement with an eligible business firm for an extended abatement under ORS 285C.160.

(A) Loss of an extended abatement under ORS 285C.240(3)(b) in OAR 123-674-0500(2);

(B) Payment to the zone sponsor of the equivalent of one year’s tax savings under ORS 285C.240(6) according to OAR 123-674-6600 to 123-674-6630; or

(4) An approved business firm may not apply for authorization or certification as described in section (2) this rule, if since termination, another business or corporation has bought or absorbed the firm, such that the firm neither remains essentially intact, even as a subsidiary of the purchasing company, nor continues to operate substantially as it had prior to its being acquired.

History

Statutory/Other Authority: ORS 285C.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.175, 285C.245, 285C.255, 285C.403 & 285C.409
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-650-9700 Timely Completion of Investments

For purposes of a proposed investment in qualified property or a facility by a business firm authorized or certified in a terminated enterprise zone:

(1) As used in ORS 285C.245:

(a) “… within a reasonable time …” means that property or a facility is in service no later than 18 months after the date on which relevant construction, reconstruction, additions, modifications or installations commenced.

(b) “… without interruption …” means that property or a facility does not remain in an unfinished state for more than six months without significant construction, reconstruction, addition, modification or installation activity and progress toward completion of such activities in fulfillment of subsection (a) of this section.

(2) The property may not qualify and receive the exemption under ORS 285C.175 or 285C.409(1)(c) if section (1) of this rule is violated, except in the event that the Department issues a finding to the county assessor that the delay is reasonable and not excessive, given the nature and extent of the investment or of inadvertent circumstances.

(3) Nothing in this rule shall influence or restrict an exemption on property in an enterprise zone that still exists and has not terminated.

History

Statutory/Other Authority: ORS 285C.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175, 285C.245 & 285C.409
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Division 656 TRIBALLY AND FEDERALLY BASED ZONE DESIGNATIONS

Or. Admin. R. 123-656-0001 Purpose and Scope

This division of administrative rules addresses the existence of enterprise zones in addition to OAR 123-650, as provided under:

(1) ORS 285C.300 to 285C.320 respective to Oregon-based Tribes; and

(2) ORS 285C.085 based on special federal designations.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.085 & 285C.300 – 285C.320
OBDD 10-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-0100 Temporary rule language in effect until 12/01/2026. Definitions

OAR 123-001 (Procedural Rules) and 123-650 define terms used in this division of administrative rules. In addition:

(1) As used in ORS 285C.085(4)(b), “all areas within both the federal enterprise zone and the city, county or port are included in a state enterprise zone” means that the state enterprise zone will need to encompass all of the Federal Enterprise Zone inside the territory of any city, port or county that will sponsor the zone. This is true regardless that such territory is also inside an overlapping city, port or county that neither sponsors nor consents to the zone, in that not every city, port or county needs to sponsor or consent as required under ORS 285C.065, 285C.066 or 285C.068, but other jurisdictions may formally consent to include parts of the Federal Enterprise Zone that are outside sponsor territory in the state enterprise zone consistent with OAR 123-650-0500.

(2) As used in these administrative rules, unless the context demands otherwise:

(a) Federal Enterprise Zone is a designation by an agency of the U.S. government that is:

(A) Not terminated;

(B) Located at least partially in this state;

(D) Intended at least in part to create or improve economic opportunities and development within the local community;

(E) Provided for by federal law that includes congressionally authorized benefits for purposes of paragraph (D) of this subsection;

(F) Qualified based on federal guidelines, including but not limited to criteria for a level of economic development need generally comparable to that indicated under ORS 285C.090; and

(G) For example, comparable historically to federal Renewal Communities, Empowerment Zones or Opportunity Zones.

(b) RENZ means a reservation enterprise zone under ORS 285C.306(2).

(d) Tribe means one of the federally recognized Indian tribes in Oregon listed under ORS 285C.306(1).

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, ORS 285C.085 & 285C.300 – 285C.320
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 11-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 10-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-1000 Temporary rule language in effect until 12/01/2026. TRIBAL ZONES — Applicability of Regular Parameters

For purposes of RENZs and RPRZs:

(1) Their creation does not depend on any measure of local economic development need or on consultation with local taxing districts.

(2) They do not need to satisfy the following requirements in OAR 123-650, except pursuant to a boundary change under ORS 285C.115(3), including but not limited to:

(a) Maximum distances overall or between an RENZ’s separate areas; or

(b) General co-sponsorship or consent by applicable city, port or county governments as described in OAR 123-650-0500.

(3) Each may have total area within its boundary of up to but not more than 12 square miles consistent with OAR 123-650-1000(3) and (4), for which:

(a) A RENZ application to the Department shall adhere to OAR 123-650-1500, but any RENZ may include separate, noncontiguous areas anywhere in this state.

(b) The cosponsors of an RPRZ shall determine how to define, map and describe the zone’s area, but it must be contiguous.

(4) Either may designate itself for electronic commerce status under ORS 285C.095 (see OAR 123-662).

(5) The zone sponsor shall fulfill the duties incumbent on it under ORS 285C.105 or elsewhere in ORS chapter 285C, including but not limited to those addressed in OAR 123-668.

(6) They are invariably ‘rural’ enterprise zones:

(a) Even if entirely or partially inside a regional or metropolitan urban growth boundary, notwithstanding OAR 123-650-0700.

(b) For purposes of the standard exemption under ORS 285C.175 (see OAR 123-674) and long-term tax incentives under ORS 285C.409 (see OAR 123-690), regardless of where any part of the zone exists, but:

(A) The facility must nevertheless be in an applicable county for the long-term tax incentives; and

(B) Neither a RENZ (designated after 2003) nor an RPRZ sponsor may elect or allow a hotel, motel or destination resort business to be eligible for the standard exemption.

(7) They may set a support fee rate with a school district as described in OAR 123-668-4000.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.050 – 285C.250, ORS 285C.255, ORS 285C.300 – 285C.320 & ORS 285C.400 – 285C.420
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-1200 Reservation Enterprise Zone Designations

For purposes of RENZs, consistent with OAR 123-656-1000:

(1) To apply for designation of a RENZ, the Tribe shall furnish the Department with the following:

(a) A copy of the resolution requesting designation, as duly adopted by the Tribe’s governing body within the past six months;

(b) Map and so forth as applicable in accordance with OAR 123-656-1000(3);

(c) A formal statement or evidence to the effect that the proposed zone area contains only such land of the Tribe under ORS 285C.306(2)(b) – that is, the following based on current laws, authority or treaties with the U.S. government:

(A) Land held in trust;

(B) Land officially pending trust status;

(D) Any combination of these; and

(d) As necessary or appropriate:

(A) Copies of federal documents attesting to relevant status; and

(B) A map of the zone showing and labeling the respective nature of the tribal lands comprising the designated area.

(2) Subject to the accuracy and completeness of materials provided in section (1) of this rule, the Department shall approve the designation to take effect as early as when either the Department received a complete application or the Tribe’s governing body adopted its resolution, depending on the preference of the Tribe and determination of the Department.

(3) The Department may not approve a RENZ:

(a) For a Tribe that already has one; or

(b) That includes area inside any other existing enterprise zone.

(4) A RENZ terminates by operation of law under ORS 285C.245(1)(a) or early by sponsor request under ORS 285C.245(2), but it is not subject to:

(a) Early termination by order of the Director for cause under ORS 285C.245(3); or

(b) Programmatic sunset under ORS 285C.255.

(5) In conformance with sections (1) and (2) of this rule, the Tribe may seek to have the RENZ:

(a) Amended through a boundary change at any time without triggering provisions under ORS 285C.115(3) consistent with OAR 123-656-1000(2).

(b) Re-designated:

(A) Concurrent with or after the July-1 termination date under ORS 285C.245(1)(a) and (4); or

(B) Any time more than a year after a requested early termination under ORS 285C.245(2).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.245 & 285C.306
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-1400 Reservation Partnership Zone Co-sponsorships

For purposes of RPRZs, consistent with OAR 123-656-1000 and pursuant to a co-sponsorship agreement:

(1) The zone’s effective beginning, equivalent to designation, is the execution of the agreement or a specified, later date in the agreement.

(2) The agreement shall be between a single Tribe and one or more cities, ports or counties, regardless of provisions for joint sponsorship or consent by any other such government under ORS 285C.065, 285C.066 or 285C.068.

(3) The RPRZ shall consist of contiguous area inside the jurisdictional territory of its city, port or county cosponsor(s), and such area may also be (but does not need to be) land of the Tribe under ORS 285C.306(2)(b)(A) or (C) or both.

(4) The Tribe and any cosponsoring city, port and county are the “zone sponsor” of the RPRZ, and their agreement shall contain appropriate and necessary provisions under ORS 190.110, regarding their mutual and respective roles and responsibility as the zone sponsor including but not limited to provisions under ORS 285C.105. Any other party to the agreement as allowed under ORS 190.110 would not be part of the zone sponsor.

(5) The zone sponsor of the RPRZ is urged in the process of executing the co-sponsorship agreement to:

(a) Consult with other cities, ports or counties that have territory in the zone;

(b) Communicate with other local taxing districts that have territory in the zone; and

(6) With respect to altering the RPRZ, the zone sponsor may mutually amend the agreement to add or remove contiguous land as described in section (3) of this rule at any time without triggering provisions under ORS 285C.115(3) consistent with OAR 123-662-1000(2).

(7) With respect to RPRZ termination:

(a) The agreement shall recognize that the zone does terminate by operation of law under ORS 285C.245(1)(a) after June 30 immediately following 10 years since the effective date of its beginning, and the term of the agreement shall be for at least that long. An RPRZ is otherwise not subject to ORS 285C.245(1)(b) or (c), (2) or (3) or 285C.255.

(b) It may occur sooner due to the effective dissolution of the agreement by mutual consent of its parties. In the event of such dissolution, any business firm shall enjoy the same protection under relevant provisions of law and this chapter of administrative rules for location in a terminated enterprise zone.

(c) The Tribe and city, port or county may create a new RPRZ pursuant to or in replacement of a terminated one, based on a newly executed co-sponsorship agreement consistent with this rule.

(8) There is no particular limit on the number of RPRZs that may exist statewide, or that any city, port, county or Tribe may cosponsor. A city, port or county cosponsor of an RPRZ may also sponsor another enterprise zone, and as originally cosponsored, an RPRZ may contain area of an existing regular enterprise zone (other than a RENZ or another RPRZ), which shall remove or exclude the RPRZ area with the earlier of its next boundary change or re-designation.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, 285C.245 & 285C.306
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-1600 Tribal Credit against State Income Taxes

For purposes of the standard credit under ORS 315.506 to offset state personal or corporate income/excise tax liabilities based on tribal taxes incurred or paid to the Tribe for an applicable business facility in any RENZ or RPRZ:

(1) It is available to a business engaged in any type of income-furthering activity, other than leasing the facility to tenants, irrespective of receipt or qualification for any other enterprise-zone tax abatement by the business or the facility.

(2) The business must have acquired the facility (by purchase or lease) or completed its construction, erection or installation, only since January 1, 2002. In addition, for a previously existing facility:

(a) If located on the Tribe’s reservation, the business operations need to be significantly different from and not in any way the continuation of what was undertaken at the facility before its latest acquisition; and

(b) The facility, for purposes of applicable tribal property taxes, comprises new investments (completed and placed in service since January 1, 2002) only to the extent that they effectively enlarged or extended the ability of the business to generate revenue at the facility, as opposed to existing property or the replacement of existing property.

(3) The credit (for which any unused amounts may not be carried forward) equals:

(a) The total amount of tribal taxes under ORS 285C.300 incurred or paid by the business in or respective to the first income/excise tax year, in which it operates in the RENZ or RPRZ; or

(b) For any other tax year, only the annual property taxes imposed by the Tribe on facility property consistent with section (2) of this rule.

(4) An applicable tribal property tax for purposes of section (3) of this rule shall be:

(a) Levied in an area encompassing an entire district, in which multiple businesses might generally develop and operate, and throughout which the Tribe has authority to impose and collect such a tax on non-Indian businesses, regardless of the area’s general correspondence to or coverage by the RENZ or RPRZ;

(b) Computed based on a rate or schedule of rates multiplied by the valuation of certain types of tangible property in the area of taxation, even if the methods, definitions and so forth differ from ad valorem taxation under state law; and

(c) Uniformly assessed and imposed on any non-Indian business, as well as Indian enterprises if they too are subject to the same tax and not exempt in any way due to location in the RENZ or RPRZ.

(5) To claim the tax credit, the business/taxpayer shall fill out the latest revision of the Department of Revenue Schedule OR-REZT, form 150-102-046, Reservation Enterprise Zone Tax Credit though not submit it with the tax return, for an applicable income/corporate excise tax year beginning before the date prescribed under section 21, chapter 913, Oregon Laws 2009, as last amended. The schedule is available from the Department of Revenue at oregon.gov/dor/forms/Pages/default.aspx.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 315.506 (Formerly ORS 285C.309, not removed from series by legislative action) & OrLaws 2019, ch. 320, §7 (inserting cross-reference to definitions in ORS 285C.300)
OBDD 47-2024, minor correction filed 10/18/2024, effective 10/18/2024
OBDD 14-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 11-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 10-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2016, f. & cert. ef. 9-16-16
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-2000 FEDERAL ENTERPRISE ZONES — Federally Based Designation

For purposes of applying for and designating an enterprise zone under ORS 285C.085(2):

(1) City, port or county governments may seek designation of a zone corresponding to the boundary of a single Federal Enterprise Zone located in the government’s territory:

(a) Submission may be made to the Department at any time without regard to an application form;

(b) Besides a map and so forth of the proposed enterprise zone consistent with OAR 123-650-1500, the submission must document the Federal Enterprise Zone’s official existence, location and satisfaction of OAR 123-656-0100(2)(a), except to the extent that the Department is fully aware of such satisfaction;

(d) The governments must send notice and engage in timely communication with local taxing districts in accordance with OAR 123-650-5500;

(e) A cosponsor of a zone terminated as described in OAR 123-650-9100(1)(b) is not excluded from applying;

(f) Zone sponsor may not elect under ORS 285C.070 for hotels, motels or destination resorts to be eligible business firms in the zone;

(g) Zone sponsor may set a support fee rate with a school district in accordance with OAR 123-674-4000; and

(h) The designation shall not be the re-designation of an existing or previously existing enterprise zone.

(2) The designation of the zone may be made without regard to any limitation on size or dimensions as described in OAR 123-650-1000 and 123-650-1100.

(3) The zone must still conform to requirements for:

(a) Being either urban or rural as described in OAR 123-650-0700, except through a special dispensation in the Director’s Order;

(b) Not containing any area inside any other existing enterprise zone consistent with OAR 123-650-1000(2); and

(c) Inclusion of any area in each cosponsor that is also inside the Federal Enterprise Zone according to OAR 123-656-0100(1).

(4) The Director shall issue an order to accomplish the designation.

(5) A (co)sponsor of an existing enterprise zone may not seek designation as described in this rule, if the Federal Enterprise Zone overlaps with a portion of the existing enterprise zone, but rather should avail itself of a boundary change as described in OAR 123-656-2100.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.085
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-2100 Boundary Changes to Conform to Federal Zone

For purposes of a local request to change the boundary of an existing enterprise zone under ORS 285C.085(3):

(1) The request is generally comparable to submission as described in OAR 123-650-4400 and OAR 123-656-2000.

(2) Such a boundary change may add an area to the existing zone, only if the area is located in a county, in which the zone is already located, or in a contiguous county.

(3) Following the change in the zone boundary, the existing zone shall be Terminated-by-Statute or may be terminated by order of the Director, as normal under ORS 285C.245, irrespective of the boundary change.

(4) If the Federal Enterprise Zone terminates prematurely for nonperformance, violation of federal guidelines or similarly unusual circumstances, then the Director may rescind the order changing the boundary of the zone, as if that boundary change had never occurred. Any business firm located in an area consequently left out of the zone shall enjoy the same protection under the relevant provisions of law and this chapter of administrative rules for location in a terminated enterprise zone.

(5) Once an enterprise zone has been designated or amended as described in OAR 123-656-2000 or this rule, a (further) change in the boundary of the zone may be requested and done under ORS 285C.115, as otherwise allowed, with the following clarifications:

(a) If the total area of the enterprise zone equals or exceeds the relevant 12 or 15 square miles, additional area may be included only if located:

(A) In parts of the Federal Enterprise Zone within a city, port or county that would become a cosponsor of the zone with the boundary change;

(B) In new parts of the Federal Enterprise Zone, as amended by authority of the federal government; or

(b) If the zone exceeds the maximum overall allowed distance applicable to the zone, additional areas may be included in one of the following ways:

(A) Consistent with subsection (a) of this section;

(B) Where such areas do not increase the overall distance within the zone consistent with provisions under ORS 285C.120(1)(b) and (c); or

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.085 & 285C.115
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-656-2300 Terminations

For an enterprise zone designated as described in OAR 123-656-2000:

(1) The zone terminates by operation of state law under ORS 285C.245(1)(a), subsequent to the effective date of designation by order of the Director, regardless of any intervening termination of the Federal Enterprise Zone due to programmed operation under federal statutes or repeal of the operative federal law.

(2) The zone may terminate early and shall terminate by programmatic sunset, as described in OAR 123-650-9100(1)(b) or (c).

(3) With respect to termination in section (1) of this rule, the local zone sponsor may re-designate it as a regular enterprise zone under ORS 285C.250 but only in conformance with all applicable requirements including but not limited to ORS 285C.090.

(4) In addition, the zone may also terminate by order of the Director under ORS 285C.085(5), effectively rescinding the order designating the zone, as if it had never existed, in the event that the federal government prematurely terminates the Federal Enterprise Zone for nonperformance, violation of federal guidelines or similarly unusual circumstances. In this case, there is no provision for a re-designation under ORS 285C.250, but any business firm located in the zone is covered by OAR 123-650-9500 to 123-650-9700.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.085, 285C.245, 285C.250 & 285C.255
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2015, f. & cert. ef. 11-12-15
OBDD 24-2010, f. & cert. ef. 6-14-10

Division 662 ELECTRONIC COMMERCE ENTERPRISE ZONES

Or. Admin. R. 123-662-0001 Purpose and Scope

This division of administrative rules specifies matters related to areas designated for electronic commerce and the business tax incentives especially available in them, including but not limited to the electronic commerce overlay of an enterprise zone:

(1) In such areas businesses engaged in Electronic Commerce are not only eligible for the standard enterprise zone exemption, but they may also qualify for a state income tax credit based on their Electronic Commerce investment.

(2) These administrative rules:

(a) Have no bearing on any enterprise zone aside from its having electronic commerce status; and

(b) Do not control or bind the county assessor or Department of Revenue and are superseded by OAR chapter 150 in matters related to tax administration.

History

Statutory/Other Authority: ORS 285A.075, 285C.050(5), 285C.060(1) & 285C.102(3)(c)
Statutes/Other Implemented: ORS 285C.050, 285C.078, 285C.095, 285C.100, 285C.102, 285C.135, 285C.180, 285C.185, 315.507 & 315.508
OBDD 9-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 10-2015, f. & cert. ef. 10-5-15
OBDD 25-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-662-0100 Definition of Electronic Commerce

OAR 123-001 (Procedural Rules) defines terms used in this division of administrative rules, unless the context demands otherwise; in addition, for purposes of Electronic Commerce as defined under ORS 285C.050(5):

(1) E-commerce zone means any of the enterprise zones designated for electronic commerce under ORS 285C.095 in accordance with OAR 123-662-1000 and 123-662-1200.

(2) “Predominantly” means that more than 50 percent of applicable transactional activity is Internet-based in terms of receipts, number of orders, clients served or like measures, as opposed to activity handled directly or primarily through other means such as by telephone or e-mail.

(3) Applicable business activity and related investments must:

(a) Locate and occur inside the E-commerce zone;

(b) Involve dealings with customers, suppliers, clients or other transactional entities that are external to the eligible business firm, predominantly over the Internet itself or on a computer network that utilizes the Internet as a platform; and

(c) Entail, support or relate to the sale or purchase of goods, property or services, whether conducted on a wholesale, commercial, business-to-business, retail or other basis.

(4) Includes facilities, equipment, services, networks, software, broadband infrastructure and so forth, as provided or operated inside the E-commerce zone by a company which enables, supports or fosters business transactions by means consistent with sections (2) and (3) of this rule. Such a company is eligible for purposes of tax abatement if other businesses or organizations represent 75 percent or more of its customers or gross receipts (as opposed to households or the general public) in the conduct of electronic commerce activity.

(5) Encompasses elements of the transaction’s overall completion or delivery, beyond the initiation or consummation of the sale, purchase or arms-length exchange, if the element:

(a) Is conducted in the E-commerce zone by means consistent with sections (2) and (3) of this rule, including but not limited to customer service, technical support, claims processing, client evaluation, performance measurement or the like, even if the actual sale, purchase or contract originated outside the zone or through other means; or

(b)(A) Naturally serves, underpins or arises from the Electronic Commerce sale or purchase of goods, property or services, including but not limited to distribution, made-to-order assemblage, direct after-sale support, shipping, warehousing, warranty service or any similar operation or order fulfillment-type activity undertaken in the E-commerce zone, including but limited to a local retail “fulfillment center” as defined in OAR 123-674-1000(2);

(B) As may be understood by way of a flowchart representing the totality of operations in the zone, such that if a critical node in that flowchart is handled by means consistent with sections (2) and (3) of this rule, then:

(i) Substantially related activities both upstream and downstream of the node are also included for purposes of this rule; and

(ii) Associated qualified property or investments in capital assets shall receive respective tax benefits subject to other applicable requirements.

History

Statutory/Other Authority: ORS 285A.075, 285C.050(5) & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, 285C.135, 285C.180, 285C.185 & 315.507
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 9-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 10-2015, f. & cert. ef. 10-5-15
OBDD 25-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-662-1000 Electronic Commerce Zone Status

(1) An E-commerce zone may be any enterprise zone, whether urban or rural, except as described in section (3) of this rule, that is already designated in accordance with OAR 123-650 or 123-656 and has not terminated.

(2) Electronic commerce status fully overlays the entire area of the enterprise zone designated as an E-commerce zone inclusive of areas added by a subsequent change to the zone’s boundary.

(3) The sponsor of an enterprise zone may revoke its status as an E-commerce zone by resolution(s), at any time, pursuant to which the Department shall establish the effective date of revocation, but that enterprise zone designation is not eligible to be an E-commerce zone.

(4) To designate an E-commerce zone:

(a) The process begins with a zone sponsor’s sending a formal (email advisory) to the Department of its intent to so designate, which must occur on or after an effective date in OAR 123-662-1200;

(b) The Department shall respond promptly to such an advisory, conferring with the sponsor’s representative about the availability of any designation and other pertinent information as the Department will memorialize through an email reply;

(c) Not less than 31 days after advising the Department, the sponsor may submit its E-commerce designation, consisting of an executed (potentially electronic) copy of a resolution that designates the zone an E-commerce zone, as adopted by each governing body of the zone sponsor consistent with its charter, by-laws or ordinances after conferring with the Department; and

(d) Subject to the resolution(s) in subsection (c) of this section and other procedural matters being in order, as well as E-commerce zone availability under the law, the Department shall issue a positive determination confirming the designation and establishing its effective date.

(5)(a) Pursuant to advisories and so forth in section (4) of this rule, if the Department receives more submissions than the number of available electronic commerce designations, on effectively the same day, then the positive determination(s) shall go to the zone with the earlier date of resolution adoption by any cosponsor.

(b) If subsection (a) of this section results in a tie, tiebreakers shall be employed in the following order:

(A) The enterprise zone that less recently had electronic commerce status;

(B) The formal advisory received on the earlier date;

(D) Special determination of the Director.

(c) If the Department receives fewer submissions than there are available E-commerce zone designations, despite excess advisories in section (4) of this rule, then pursuant to advisories from other zone sponsors, the Department shall process additional submissions consistent with this section, until all available designations are positively determined to have been made.

(6) The Department shall promptly give written notification and explanation to any zone sponsor subject to a negative determination of its electronic commerce designation and shall counsel the sponsor about the viability and timing of resubmission.

(7) As otherwise permissible, the Department may allow a zone sponsor of an E-commerce zone to re-designate itself as an E-commerce zone at the time it re-designates the enterprise zone under ORS 285C.250, if the zone was designated for electronic commerce within one year of the enterprise zone’s termination in OAR 123-650-9100(1)(a).

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.102(3)(c)
Statutes/Other Implemented: ORS 285C.078, 285C.095 & 285C.102
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 5-2020, temporary amend filed 07/17/2020, effective 07/17/2020 through 01/12/2021
OBDD 13-2016, f. & cert. ef. 9-16-16
OBDD 10-2015, f. & cert. ef. 10-5-15
OBDD 25-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-662-1200 Designated Areas

(1) The sponsor of any eligible existing enterprise zone that is not already an E-commerce zone or has not revoked such status may designate itself as an E-commerce zone in accordance with OAR 123-662-1000:

(a) If the Legislature allows additional electronic commerce designations under ORS 285C.095 for enterprise zones, which are currently limited to 15, pursuant to the date that the legislation took effect.

(b) If an E-commerce zone terminates according to OAR 123-650-9100(1)(a) or (b), except for OAR 123-662-1100(7), or its zone sponsor revokes the electronic commerce designation, pursuant to the date that the termination or revocation took effect.

(2) The Department shall maintain and publicize information identifying which enterprise zones are currently E-commerce zones.

(3) The City of North Plains in Washington County is a city designated for electronic commerce under ORS 285C.100, effective March 4, 2002, such that:

(a) The city shall act as a zone sponsor and take responsibility for all duties of a zone sponsor, as if North Plains were a rural enterprise zone, with respect to any business firm seeking an exemption under ORS 285C.170 or 285C.175 on qualified property located inside the city limits or its urban growth boundary.

(b) The standard exemption is allowed at such a location only insofar as the business firm is:

(A) Eligible on the basis of Electronic Commerce operations in terms of this division of administrative rules, for purposes of which North Plains is the same as an E-commerce zone; or

(B) Engaged in research, design, development, fabrication, assembly, testing, packaging or validation of semiconductors, or in producing equipment, core intellectual property, automation software, or intermediary inputs or supplies, primarily intended for use in the semiconductor industry, provided that construction, modification or installation of qualified property commences in North Plains on or after June 6, 2024, when chapter 52, Oregon Laws 2024 (Senate Bill 1526) takes effect.

History

Statutory/Other Authority: ORS 285A.075, 285C.050(5), 285C.060(1) & 285C.102(3)(c)
Statutes/Other Implemented: ORS 285C.095, 285C.100, 285C.102 & 285C.135
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 10-2015, f. & cert. ef. 10-5-15
OBDD 14-2012, f. & cert. ef. 8-15-12
OBDD 25-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-662-2000 Enterprise Zone Business Eligibility

Respective to the standard exemption from property taxes under ORS 285C.175:

(1) A business firm engaged in Electronic Commerce will likely be eligible in other ways under ORS 285C.135, but it shall not be subject to the requirements or restrictions of those other ways once the enterprise zone is effectively an E-commerce zone.

(2) If an eligible business firm that originally sought eligibility based on Electronic Commerce does not satisfy that definition, it may still receive authorization and exemption subject to another way’s requirements or restrictions, except in an area described in OAR 123-662-1200(3).

(3) The following may occur only once the enterprise zone is effectively an E-commerce zone:

(a) Authorization or qualification of a firm that is eligible only by virtue of Electronic Commerce; or

(b) Exemption of personal property permissible only under ORS 285C.185(1)(b)(B).

(4) Property that due to section (3) of this rule does not qualify for exemption by January 1 of the first year, for which a business firm may claim the exemption, is not allowed to qualify later, even if the enterprise zone is designated for E-commerce.

(5) After an area’s status as an E-commerce zone effectively ceases, a business firm shall enjoy the following protection for exemption on qualified property respective to Electronic Commerce eligibility, notwithstanding that the firm might be eligible in another way, as described:

(a) In OAR 123-650-9500 and 123-650-9600, if for whatever reason the underlying enterprise zone terminates and the location of the qualified property is outside of a subsequent enterprise zone.

(b) Only in OAR 123-650-9500 regardless that the firm was already authorized or qualified, upon:

(A) Revocation of the zone’s electronic commerce designation; or

(B) Termination of the underlying enterprise zone and designation of the location of qualified property in another enterprise zone without electronic commerce status.

History

Statutory/Other Authority: ORS 285A.075, 285C.050(5) & 285C.060(1)
Statutes/Other Implemented: ORS 285C.095, 285C.100, 285C.135, 285C.140, 285C.180, 285C.185 & 285C.245
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 10-2015, f. & cert. ef. 10-5-15
OBDD 25-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-662-2100 Temporary rule language in effect until 12/01/2026. Waiver or Pilot Program for Business Eligibility

For the purposes of ORS 285C.135(3)(b), a business firm engaged in a business activity described in ORS 285C.135(2) may qualify as an eligible business firm if the zone sponsor(s) request a waiver or authorization of a pilot program and the zone sponsor(s) demonstrates that the business activity will provide substantial community benefit, innovation or alignment with local economic development goals.

(1) Examples of substantial community benefit, innovation or alignment with local economic development goals include but are not limited to:

(a) Significant job creation for the local area;

(b) Significant contributions to the community through community benefit payments or support;

(d) Support of local economic development goals established through the Enterprise Zone re/designation process (as described in OAR 123-650-4200).

(e) Support local economic development goals which include, but are not limited to, job creation, job retention, wage growth, workforce development, or infrastructure investment.

(2) If zone sponsors want to authorize business activities described in ORS 285C.135 to be allowed activity to qualify as an eligible business firm, the zone sponsors may establish a pilot program under ORS 285C.135(3)(b)(A) in advance of an authorization approval to allow for multiple firms and projects engaged in such activities to be eligible to receive exemption under ORS 285C.175.

(a) The zone sponsors must establish the pilot program, including describing eligible activities and any other features of the pilot program, as part of a resolution described in OAR 123-650-4800(2)(h). As part of the resolution, the zone sponsors shall confirm that the allowable business activity for the pilot program will provide a substantial community benefit, innovation or alignment with local economic development goals.

(b) Property of the eligible business firm under the pilot program must comply with eligible property requirements as described in ORS 285C.180 and OAR 123-674-5200 to receive the exemption.

(c) Zone sponsors and the business firm must confirm eligibility allowance on the authorization application approval form.

(3) If zone sponsors want to waive ineligibility of specific business activities described in ORS 285C.135(2) for an individual firm, they may adopt a resolution before approval of the eligible business firm in which

(a) The zone sponsors must establish the business activity will provide a substantial community benefit, innovation or alignment with local economic development goals

(b) The waiver approval is specific to a single business firm.

(c) Property of the eligible business firm that is provided a waiver must comply with eligible property requirements as described in ORS 285C.180 and OAR 123-674-5200 to receive the exemption.

(d) Zone sponsors and the business firm must confirm eligibility allowance on the authorization application approval form.

(4) Once a resolution authorizing a pilot program or approving a waiver is passed by zone sponsors governing bodies, the zone sponsor must submit the documentation to the Department for final review and approval as required by OAR 123‑650‑4900.

History

Statutory/Other Authority: ORS 285A.075, ORS 285C.050(5) & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.095, ORS 285C.100, ORS 285C.135, ORS 285C.140, ORS 285C.180, ORS 285C.185 & ORS 285C.245
OBDD 10-2026, temporary adopt filed 06/05/2026, effective 06/05/2026 through 12/01/2026

Division 668 LOCAL ENTERPRISE ZONE SPONSORSHIP

Or. Admin. R. 123-668-0001 Purpose and Scope

This division of administrative rules provides guidance and parameters applicable to:

(1) Selected issues regarding how the local sponsor operates and controls an enterprise zone, including with respect to business tax incentives (primarily for the standard property tax exemption as addressed in OAR 123-674); and

(2) Any situation provided by law, under which the local government or governments that sponsor an enterprise zone may (jointly) impose additional requirements or conditions on a business firm for receiving tax benefits associated with an investment in the enterprise zone.

(3) Obligations of zone sponsors as enacted by chapter 298, Oregon Laws 2023 (House Bill 2009).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050 - 285C.250
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-0100 Sponsor of a Zone

OAR 123-001 (Procedural Rules) contains definitions used in this division. Additionally, as used in this division and related divisions of this chapter of administrative rules (OAR 123-650 to 123-690), as well as relevant parts of ORS chapter 285C, unless the context demands otherwise:

(1) “Sponsor” or “zone sponsor” includes the single city, port or county, or the cities, ports or counties, or any combination of these, collectively, as described in OAR 123-650 that:

(a) Most recently designated or re-designated the enterprise zone under ORS 285C.065 or 285C.250; or

(b) Joined the zone with a change to the zone boundary under ORS 285C.115.

(2) Sponsor also refers to:

(a) The tribal government and any city, port or county cosponsor of a reservation enterprise zone or a reservation partnership zone under ORS 285C.306 (see OAR 123-656).

(b) The county, multiple counties or city that sought designation of a rural renewable energy development zone under ORS 285C.353 (see OAR 123-680).

(3) Depending on the particular context, “a sponsor” or “a zone sponsor” may refer to a single sponsoring entity or “cosponsor” of the enterprise zone included in section (1) or (2) of this rule. Such reference neither supersedes nor interferes with ORS 285C.105(2), which compels all cosponsors to act jointly in fulfilling the duties of the zone sponsor and in taking any action with respect to the zone, with the exception of:

(a) Restriction on hotel/resort eligibility by a city or county: at designation, in joining with boundary change, or with partial revocation of a hotel/resort election, according to OAR 123-650-4800(2)(e) and (3); or

(b) Provision of local incentives as described in OAR 123-668-1300.

(4) The zone sponsor does not include and is not any city, port or county that simply consented to having part of its territory contained in an enterprise zone as described in OAR 123-650-0500.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.370
Statutes/Other Implemented: ORS 285C.050 - 285C.250, 285C.320 & 285C.353
OBDD 13-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1000 DUTIES & OPTIONS — Local Zone Manager

For purposes of ORS 285C.105(1)(a):

(1) The sponsor of an enterprise zone shall appoint and maintain a local zone manager, though not necessarily by resolution, which must be done no more than 90 days after the zone’s re-/designation if one was not appointed through the documentation submitted under ORS 285C.074.

(2) The sponsor or a particular cosponsor may delegate the authority to appoint the local zone manager to a person or body including but not limited to the current local zone manager.

(3) The sponsor may make appointment of a local zone manager by way of an established position at a local agency or organization, whether public or private, as opposed to a named person.

(4) The sponsor may appoint up to but not more than two persons to serve as local co-managers of the zone, which may not be treated as officially bifurcating the zone in any way.

(5) Except as explicitly proscribed by the zone sponsor, the local zone manager shall act as the agent and representative of the enterprise zone in regard to any and all ministerial, intergovernmental, technical or promotional functions of the zone sponsor.

(6) The local zone manager may be empowered by and on behalf of the zone sponsor or a cosponsor to make discretionary decisions or enter into agreements, for which the law does not stipulate adoption of a resolution by the governing body or bodies of the sponsor.

(7) Whenever a local zone manager is appointed or a new person fills the appointed position, the sponsor needs to give written notice to the Department, the Department of Revenue and the county assessor soon afterwards.

(8) Anyone may serve as local zone manager, but it behooves the sponsor to:

(a) Select a person/position with complementary responsibilities, such as working regularly and locally with eligible business firms; and

(b) Formalize zone manager duties in the person/position’s job description or contract.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105
OBDD 8-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1100 Reports by Sponsor at Beginning and End of an Enterprise Zone

(1) Within six months after re-/designation of any enterprise zone, the zone sponsor shall provide the following information, unless fully completed as part of documentation submitted with re-/designation, to the Department and any other organization deemed appropriate by the sponsor for purposes of ORS 285C.105:

(a) A description and examples of marketing plans, efforts or materials for the zone;

(b) A list, map or other information necessary for identifying publicly owned land or buildings that are available for lease or purchase by an eligible business firm within the zone under ORS 285C.110 according to OAR 123-668-1400;

(c) For an urban zone, indices identifying all land within the zone, which for example, may be accomplished by on-line locator software, and for which specific tax lots or street addresses are needed only for properties at which eligible development may occur;

(d) Description of normally expected actions to be taken or reasonable requirements to be imposed, as well as policies and standards adopted, by the sponsor under ORS 285C.150, 285C.155, 285C.160, 285C.203, 285C.205 or 285C.403 with respect to business firms using the zone;

(e) Confirmation of having appointed the local zone manager consistent with OAR 123-668-1000; and

(f) The final form of any change in the election or restrictions to allow hotel, motel or destination resorts as eligible business firms in all or certain city or county jurisdictions of the enterprise zones, for which newly adopted resolution(s) are necessary as described in OAR 123-650-4800(2)(e).

(2) The sponsor shall periodically update and repeat the reporting of information described in section (1) of this rule, as applicable or necessary under ORS 285C.105, including as described in OAR 123-668-2000(5).

(3) Within six months following the termination of an enterprise zone unless re-designated in its entirety, the sponsor of the terminated zone and the county assessor shall jointly submit to the Department of Revenue, Department and contact agency, a complete list of:

(a) The names of all business firms authorized, certified or qualified in the zone at the time of termination and located outside of any currently designated enterprise zone;

(b) The dates of submission and approval for each authorization or certification application;

(d) The status of each investment or exemption of the authorized, certified or qualified business firm (for example, “under construction”).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.060, 285C.070, 285C.105 & 285C.110
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1300 Enhanced Public Services and Other Local Incentives

For purposes of ORS 285C.105(1)(b) and local incentives that an enterprise zone sponsor or cosponsor elects by policy to provide to authorized business firms qualifying for the standard property tax exemption (OAR 123-674) within its jurisdiction or service territory:

(1) Such local incentives include but are not limited to:

(a) Enhanced availability or efficiency of local public services, such as utilities, transportation access and public safety protection;

(b) Waivers, discounts or credits from local fees, charges, business/license taxes and so forth; or

(c) Regulatory flexibility, expedited/simplified permitting, special zoning designations, exceptions from ordinances, or the like that do not significantly undermine regulations pertaining to health and safety.

(2) Unless clearly stipulated in the sponsor’s policy as discretionary, any such incentive is binding on that sponsoring government and must be implemented (for example, by ordinance as necessary) and made regularly available to any business firm that makes application for authorization on or after the effective date that the co/sponsor adopted its policy to provide the incentive. An incentive’s status as binding in the enterprise zone for purposes of this rule is not altered by its being generally offered or available to other (non‑enterprise zone) business firms within the sponsor’s jurisdiction or service territory.

(3) With respect to any such binding incentive but not necessarily one that is discretionary:

(a) It shall be available or provided to any authorized or qualified business firm on an equal basis within that portion of the enterprise zone exclusive to the relevant jurisdiction or service territory of the respective cosponsor, except that a city or county cosponsor may formally differentiate the incentives available to authorized business firms operated as a hotel, motel or destination resort.

(b) The zone sponsor shall actively help such firms to understand, access and use any such incentive.

(c) The Department may recognize it in the context of benefits customarily associated with the enterprise zone for purposes of generally promoting the zone.

(d) By virtue of the sponsoring government’s policy for further inducing authorized or qualified business firms at locations inside the enterprise zone under ORS 285C.105(1)(b): Relative exceptions or variance from the normal provision of services, charging of fees, imposition of regulations, etc. are operative within the zone. In contrast, any discretionary incentive (even if exclusively for qualified business firms in the zone) needs to conform to applicable state or local laws, charters, ordinances or conventions for the affected charge, fee, service, regulation, etc.

(4) For purposes of a zone sponsor’s putting forward one or more new incentives to replace an incentive or incentives that are binding according to this rule, in order to avoid termination of the zone under ORS 285C.245(3)(b)(A):

(a) “Comparable value” means that the new incentives or incentives, as a whole, need to provide not only an equivalent level of direct financial benefit to business firms, but also exhibit similarity in terms of other factors such as convenience.

(b) In determining whether “reasonable corrections of shortcomings in existing local incentives” are being made, the Department may consider the extent to which an existing incentive inordinately:

(A) Benefits some or all authorized or qualified firms; or

(B) Burdens local budgetary resources or utility capacity.

(5) A local incentive offered or binding in a cosponsor’s jurisdiction or territory has no bearing on the incentives:

(a) Of any other cosponsor in the same zone; or

(b) That the jurisdiction may offer in another enterprise zone that it also sponsors.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105 & 285C.245
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1400 Locally Available, Public Real Estate

For purposes of ORS 285C.105(1)(g) and 285C.110:

(1) The zone sponsor shall:

(a) Prepare and maintain a list and map of land, buildings and structures within the zone that are:

(A) Owned by any agency on behalf of the state government or by any municipal corporation;

(B) Not in use or officially designated for some public purpose; and

(b) Undertake reasonable efforts to make the real estate identified in subsection (a) of this section available for lease or purchase by authorized or qualified business firms for purposes of the standard exemption on qualified property under ORS 285C.175 (see OAR 123-674).

(2) Except as otherwise precluded under Oregon or federal law/constitutional provisions, such firms are entitled to acquire the real estate identified in section (1) of this rule at a fair market rate/price, subject to the leasing or purchasing firm’s prompt development or redevelopment of the property pursuant to an approved application for authorization.

(3) As used in ORS 285C.110 and for purposes of this rule, “municipal corporation” has the same meaning as found under ORS 294.311, including but not limited to any special or local service district, a people’s utility district or a joint operating agency under ORS 262.005.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105 & 285C.110
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1600 Funds Derived through an Enterprise Zone

Moneys or revenue due to the enterprise zone are a special but publicly accountable resource, which are subject to applicable provisions under ORS Chapter 294 and other state or local laws with regard to collecting, holding and using such funds, and which:

(1) May arise:

(a) In the form of payments to the zone sponsor by a business firm:

(A) As specified in statute or law, in the case of:

(i) The authorization filing fee under ORS 285C.140(1)(c) consistent with OAR 123-668-1700; or

(ii) The payback of one year’s tax savings in lieu of disqualification under ORS 285C.240(6), as described in OAR 123-674-6600 to 123-674-6630.

(B) As a result of an additional requirement agreed to or imposed on the firm by the sponsor in conformance with OAR 123-668-2000 to 123-668-2500 for the situations described in OAR 123-668-2000(1) and (2).

(b) Under ORS 285C.205(3) as described in OAR 123-674-4300(3)(b)(B), through deposits by a qualified business firm into an account established by the sponsor, from which moneys are either reimbursed to the firm for training expenses or transferred to local publicly funded job training providers.

(c) From distribution by the Department of Revenue’s to the sponsor and other taxing districts of 30 percent of the corporate income or excise taxes paid by a corporation, under ORS 317.131, as addressed in OAR 123-690-8500.

(2) Do not, among other things, include:

(a) School support fees described in OAR 123-668-4000 to 123-668-4300, which are funds held by a school district for the state school system in general.

(b) When a firm makes a payment to another entity such as a charitable cause, or performs other types of actions or services, in satisfying a requirement described in paragraph (1)(a)(B) of this rule.

History

Statutory/Other Authority: 285C.060(1) & ORS 285A.075
Statutes/Other Implemented: ORS 285C.105, 285C.140, 285C.150, 285C.155, 285C.160, 285C.203, 285C.205, 285C.240, 285C.403 & 317.131
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 15-2020, minor correction filed 08/31/2020, effective 08/31/2020
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-1700 Authorization Filing Fee

For purposes of ORS 285C.140(1)(c):

(1) When applying for authorization under ORS 285C.140, an eligible business firm may be required to pay a fee that the sponsor of the enterprise zone has established:

(a) Up to the greater of:

(A) $200; or

(B) An amount not exceeding 0.1 percent of the total estimated cost of the firm’s proposed investment in qualified property.

(b) In other words, the amount of the fee may always be as much as $200 for proposed investments of $200,000 or less and 1/1000th of the estimated cost for larger investments, even though sponsors may charge a fee that is less than the maximum allowed.

(2) The sponsor shall uniformly implement the requirement of an authorization filing fee according to a policy in place before receipt of an affected application, though not necessarily through written guidelines if the policy is simply and consistently executed.

(3) Written guidelines, however, are necessary for purposes of section (9) of this rule, or to define factors under which the requirement, waiver or amount of an authorization filing fee may fluctuate, in that the sponsor may vary the fee consistent with section (1) of this rule according to certain criteria or situational factors, such as the size or nature of the eligible business firm or its proposed investment.

(4) Failure by an eligible business firm to pay the required filing fee at the time the firm applies for authorization may be grounds for the local zone manager’s refusal to process it on the sponsor’s behalf.

(5) A zone sponsor that requires an authorization filing fee shall collect payment in U.S. funds with the application for authorization and issue a receipt.

(6) If either the zone sponsor or the county assessor denies the application of an eligible business firm for authorization under ORS 285C.140, the sponsor shall refund any payment of an authorization filing fee in full to the eligible business firm.

(7) If both the zone sponsor and the county assessor have approved an eligible business firm’s application for authorization under ORS 285C.140, neither the zone sponsor nor the county assessor may later deny the eligible business firm’s authorization, qualification or exemption because of failure to receive or collect payment of an authorization filing fee.

(8) If a business firm is denied an exemption under ORS 285C.170 or 285C.175, the zone sponsor is under no obligation to refund any amount of an authorization filing fee that was paid by the business firm, unless the business firm was authorized improperly or by mistake.

(9) A sponsor may formally provide that in paying the fee, all eligible business firms applying for authorization are required to commit in writing to later reconcile the fee amount, in the event that the actual cost of qualified property differs from the estimated cost by 25 percent or more, either by receiving a partial refund or by paying the sponsor an additional amount.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.140(1)
Statutes/Other Implemented: ORS 285C.140
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 20-2023, minor correction filed 08/24/2023, effective 08/24/2023
OBDD 13-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2000 Temporary rule language in effect until 12/01/2026. REQUIREMENTS ON BUSINESSES — Applicable Situations

OAR 123-668-2000 to 123-668-2500 cover situations described in sections (1) and (2) of this rule, in which a business firm shall satisfy additional, locally imposed conditions or requirements in an enterprise zone:

(1) Under ORS 285C.403(4)(c) and a written agreement by a certified business firm with the zone sponsor for the long-term rural abatement of property taxes on a facility, as described in OAR 123-690; or

(2) For standard property tax exemptions in OAR 123-674 involving:

(a) A written agreement for the extended abatement of a period more than the standard 3-year exemption period but no more than 10 consecutive years under ORS 285C.160(2) between the zone sponsor and an authorized business firm consistent with OAR 123-674-0700;

(b) A written agreement for establishing a flexible hiring timeline or alternative performance criteria consistent with ORS 285C.200(2) and OAR 123-674-0400 and OAR 123-674-0300;

(c) Adoption of zone sponsor resolution(s), by which the statutorily required increase in zone employment of the firm is waived under ORS 285C.155 and 285C.200(3), in accordance with OAR 123-674-4300, including applicable criteria under ORS 285C.205, and that the requisite minimum level of employment is established;

(d) A policy and standards adopted by the zone sponsor of an urban enterprise zone under ORS 285C.150 affecting all authorized business firms, consistent with OAR 123-668-2500, as documented with approval of the application for authorization; or

(e) A suspension of the exemption and its resumption with or without a reduced level of required employment under ORS 285C.203, inasmuch as the zone sponsor may impose conditions in accordance with OAR 123-674-6885.

(3) Respective to sections (1) and (2) of this rule:

(a) The absence of any such stipulated requirement in an agreement, resolution or other such instrument conveying a business firm’s tax abatement or benefit suffices as proof that the abatement or benefit is not contingent on satisfaction of any additional, locally imposed condition; though, it is advised that the instrument clearly say as much.

(b) It is incumbent on the zone sponsor to take the actions necessary to consistently implement, monitor and enforce such conditions, additional requirements or policies on and with any applicably affected business firm.

(c) The county assessor is excused from any duty or obligation to track or determine satisfaction by a business firm with relevant local criteria or conditions set by zone sponsor.

(d) The assessor shall enforce any such additional requirement through denial or disqualification of the exemption pursuant only to:

(A) Timely notice by a qualified business firm or an owner of leased qualified property under ORS 285C.240(1)(d) or equivalently in the case of section (1) of this rule; or

(B) Written request from the zone sponsor to take such action accompanied by documentation or evidence of the firm’s noncompliance and of how that effectively invalidates the firm’s abatement of property taxes.

(4) Nothing in section (3) of this rule affects implementation or enforcement through loss of exemption as a consequence of noncompliance by a business firm or of property with an applicable requirement under state law, as set forth in ORS 285C.050 to 285C.250 or 285C.400 to 285C.420, based on information or evidence from the firm or any other source, including but not limited to:

(a) Average employee compensation or wages of new employees of the firm under ORS 285C.160(3), regardless of proper stipulation of such a requirement in the written agreement entered into by the firm and the sponsor;

(b) The investment minimum under ORS 285C.200(3)(b)(A); or

(c) Minimum number of employees of the firm that the zone sponsor has set under ORS 285C.155 or 285C.203 in lieu of provisions under ORS 285C.200(1) or 285C.210.

(5) Consistent with OAR 123-668-1100(1)(d) and (2), the sponsor of an enterprise zone shall inform and update the county assessor, Department of Revenue, local publicly funded job training providers or their contact agency for first source hiring agreements as relevant, as well as the Department, regarding any such condition or additional requirement in section (2) of this rule that is normally sought, including but not limited to any change in an adopted policy, criteria or methods to be used in implementing ORS 285C.150, 285C.155, 285C.160, 285C.203 or 285C.205.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, ORS 285C.150, ORS 285C.155, ORS 285C.160, ORS 285C.203, ORS 285C.225, ORS 285C.230, ORS 285C.235, ORS 285C.240 & ORS 285C.403
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 8-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2100 Basic Parameters

For purposes of local, additional requirements imposed by an enterprise zone sponsor:

(1) They shall apply to a qualified business firm’s direct receipt of the tax abatement, only:

(a) With respect to operations inside (or nearby and affected by operations in) the enterprise zone; and

(b) Between the time when:

(A) The firm receives authorization (certification in the case of the long-term rural tax incentives); and

(B) December 31 of the final year when the overall enterprise zone exemption expires.

(2) Notwithstanding section (1) of this rule, the zone sponsor and the business firm may mutually agree, possibly with certain contingencies, to apply current requirements or provisions of an agreement to future situations described in OAR 123-668-2000(1) or (2).

(3) They shall not require that the eligible business firm’s hiring, recruitment, promotion, training, compensation or treatment of its actual or potential employees, suppliers, contractors or customers be based on:

(a) Those persons’ or businesses’ explicit residency or geographic location, consistent with OP-8236, Oregon Attorney General (April 20, 1995); or

(b) Other legally impermissible criteria.

(4) The consequence of a qualified business firm’s failing to satisfy an additional requirement is not necessarily disqualification or loss of property tax benefits:

(a) If, however, that is the expected consequence, then it behooves the zone sponsor to stipulate as much in the applicable agreement, policy or resolution.

(b) Alternatively, as provided in the agreement, resolution or final supporting documentation:

(A) The firm’s failure may result in other penalties or repercussions through breach of contract or as otherwise stipulated; or

(B) The firm might fulfill an alternative requirement to avoid disqualification. (An alternative requirement shall not preclude the firm’s disqualification, if the firm later fails to fulfill the alternative requirement or any other requirement)

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, 285C.150, 285C.155, 285C.160 & 285C.403
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2200 Additional to Statutory Provisions

(1) A requirement imposed on a business firm by an enterprise zone sponsor is strictly supplemental to the provisions under applicable statutes or state laws, and it shall neither alter nor undermine their effect or intent.

(2) With respect to the following, as established by relevant state provisions, a requirement may in no way:

(a) Affect the basic eligibility or ineligibility of certain business activities or allowed uses of or the minimum size of investments in relevant property;

(b) Provide financial support to the statewide school system; or

(A) Alternative types of payment or financial contributions by the firm are possible; and

(B) The sponsor shall set the total period of tax benefit as provided by the relevant law or statute.

(3) The requirements may neither modify nor in any way effectively decrease or increase the stringency of state requirements for hiring, general employment levels or average pay/compensation associated with jobs or persons employed by the firm, and they shall not even address such issues, except for local requirements that:

(a) Deal with employment other than what is affected or covered by the relevant state requirement, including but not limited to construction or temporary workers, part-time employees, or remuneration in an enterprise zone described in OAR 123-674-0500(5);

(b) Set an alternative employment level under ORS 285C.155;

(c) Specify extra demands within the context of a First Source Hiring Agreement that the firm is otherwise required to enter into, as described in OAR 123-674-7700 to 123-674-7730; or

(d) Obligate the firm in a reasonable manner with respect to workforce development, hiring/retention from certain sources or groups, employee benefits, or other employment-related matters that are completely distinct from requirements under ORS 285C.050 to 285C.250 or 285C.412, and as may be regarded as public or community benefits.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, 285C.150, 285C.155, 285C.160 & 285C.403
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2300 Reasonableness

This rule offers guidance for evaluating whether local additional enterprise zone requirements are reasonable, such that:

(1) The requirements shall not vary dramatically or erratically over time for business firms interested in investing in the zone and seeking special benefits or waivers.

(2) The requirements shall not be arbitrarily applied, implemented or enforced, in that the sponsor shall be consistent in not only setting conditions, but also in how to handle compliance issues.

(3) The requirements may differentiate among relevant business firms for a given situation in OAR 123-668-2000(1) or (2) in terms of investment size, the firm’s industry and so forth, but such differentiation shall be:

(a) Based on definable characteristics;

(b) Consistently applied in its own regard; and

(4) The requirements may entail economic costs to the firm because of payments to the sponsor or other entities, or of actions undertaken by the firm, but these costs (less any other consequent, material benefit to the firm) in relation to OAR 123-668-2000(2)(b) to (d) shall not exceed 25 percent of the tax savings associated with the entire property tax abatement, before the effect of school support fees under ORS 285C.162 or 285C.405. With a written agreement, however, in the case of OAR 123-668-2000(1) or (2)(a) the firm may accept higher costs based on its own considerations.

(5) The requirements shall not demand procedures, practices or investments in excess of anything undertaken in the firm’s industry or related industries throughout the world, such that the sponsor shall be prepared to show that such a demand has been accomplished in the normal course of business elsewhere without apparent, extenuating circumstances.

(6) No requirement may cause or compel actions by the firm that have the potential to pose a significant other legal, financial or business threat to the firm, including but not limited to:

(a) Surrendering significant rights, privileges or immunities under state or federal law;

(b) Labor relations that may compromise practices by the firm in other locations where it operates in the United States; or

(c) Publicizing information unrelated to the administration of a local requirement that is otherwise proprietary, confidential, or threatening to the firm’s market competitiveness or contractual obligations or to that of any third party.

(7) The criteria in this rule will typically concern a zone sponsor’s underlying policy, hence the recommendations in OAR 123-668-2400 for deliberate and explicit policymaking to cover certain potentialities.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, 285C.150, 285C.155, 285C.160 & 285C.403
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2400 Zone Sponsor Policies

In terms of the means and authority by which local additional requirements are put into effect:

(1) An enterprise zone sponsor shall consider a policy-making approach to achieve accountability and maintain consistency in imposing or setting such a requirement on business firms, especially in view of the following:

(a) Constitutional or other legal protections for business firms; and

(b) General principles of fairness and clarity regarding public purposes and intent.

(2) Such a policy may apply uniformly to the situations described in OAR 123-668-2000(1) and (2), or it may pertain to only certain situations.

(3) Such a policy is relevant to the sponsor’s rationale in granting or refusing special benefits or waivers, as well as the additional requirements imposed or sought when granting the benefit or waiver to a business firm.

(4) Except for conditions imposed by an urban enterprise zone under ORS 285C.150, such a policy does not need to be prospectively adopted, nor does it need to be based on official standards or formal documentation, and it may reflect the cumulative effect of the sponsor’s relevant past actions. A formal, explicit and prospective policy may be nevertheless preferable, especially when the following or comparable circumstances arise:

(a) Relevant requests by business firms are common or expected to become increasingly frequent;

(b) Sponsor would differentiate the basic decision to grant or refuse a special benefit or waiver, or to impose additional requirements, with respect to factors such as the size of the business or investment;

(c) The requirements imposed are numerous, complicated or otherwise entail various contingencies or matters of judgment, which definitive standards would facilitate implementation; or

(d) The sponsor would depart from an apparent pattern in terms of granting a special benefit or waiver or imposing certain corresponding requirements.

(5) For an urban enterprise zone sponsor that has adopted a policy under ORS 285C.150, as described in OAR 123-668-2500, any additional requirement imposed for situations described in OAR 123-668-2000(2)(a), (b) or (d) must:

(a) Formally relate to the policy and standards adopted in the urban zone policy; and

(b) Effectively supplement and not replace any condition normally imposed.

(6) A city, port or county government that sponsors two or more enterprise zones is free to have different policies or to seek different local additional requirements among those zones.

(7) In an enterprise zone sponsored by more than one city, port or county, the cosponsors must all jointly in some manner:

(a) Adopt the same policy, standards, established local conditions and so forth under equivalent authority or method for purposes of this rule and the enterprise zone; and

(b) Approve or accede to the same written agreement with the business firm, as applicable (though not necessarily in the same way, see OAR 123-668-2450).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, 285C.150, 285C.155, 285C.160 & 285C.403
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 21-2023, minor correction filed 08/24/2023, effective 08/24/2023
OBDD 13-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-2450 Temporary rule language in effect until 12/01/2026. Approving Agreements

The sponsoring city, port or county governments of an enterprise zone may authorize the written agreement with a business firm in the case of OAR 123-668-2000(1) or (2)(a) or 2(b) through a number of approaches, which may differ among the cosponsors, including but not limited to the following examples:

(1) Approval by an official normally empowered to enter into such an agreement under the laws, charters, ordinances and conventions of the cosponsor;

(2) Approval by the person or persons formally and specifically recognized to conclude the agreement, pursuant to a previous accord between the firm and the sponsor;

(3) A specific resolution by the governing body authorizing a preliminary or final written agreement;

(4) A specific resolution by the governing body that authorizes an agent to conclude such an agreement;

(5) A standing policy adopted by the cosponsor that empowers a particular agent to negotiate such an agreement with all or some firms on behalf of the cosponsor (for example, the local zone manager); or

(6) An intergovernmental agreement that delegates to the cosponsor(s), in whose jurisdiction the firm will locate its exempt property, the right to execute the agreement on behalf of the entire zone sponsor.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.105, ORS 285C.160 & ORS 285C.403
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 13-2015, f. & cert. ef. 11-12-15

Or. Admin. R. 123-668-2500 Additional Conditions in an Urban Zone

For purposes of OAR 123-668-2000(2)(c) and additional conditions imposed on eligible business firms by the sponsor of an urban enterprise zone under ORS 285C.150:

(1) The sponsor of the enterprise zone shall abide by OAR 123-668-2000 to 123-668-2400.

(2) “Groups of persons” as used in ORS 285C.150(2) may comprise the general populace or labor force or any lesser number of persons, who may not be explicitly defined in terms of geography/residency.

(3) When approving the application for authorization, in accordance with OAR 123-674-2300(7), the sponsor of an urban zone must include information that lists and clearly explains the specific additional conditions to which the firm is committing, or to which it may be obligated under certain contingencies, in order to effect and enforce compliance.

(4) The written information as described in section (3) of this rule shall appear in a standardized format that conforms to the policy that the zone sponsor has adopted for imposition of such additional conditions, and that is used for all eligible business firms authorized in that urban enterprise zone, including but not limited to a standard performance contract to which firms agree.

(5) Failure by a firm to satisfy such additional local conditions of an urban zone may affect the exemption in the following ways:

(a) Denial of the authorization under ORS 285C.140(2)(e), but only if the firm does not formally commit to meet the conditions;

(b) Refusal of initial qualification for exemption under ORS 285C.175; or

(c) Disqualification of an ongoing exemption in accordance with ORS 285C.240(1)(d), except as provided under ORS 285C.240(6).

(6) The county assessor has an obligation to effect actions described in subsection (5)(b) or (c) of this rule only insofar as the business firm or zone sponsor has provided timely written notice or evidence of such failure.

(7) An eligible business firm shall have the same rights of appeal as provided elsewhere in ORS 285C.050 to 285C.250 for authorization and receipt of the enterprise zone exemption.

(8) The policy and standards adopted by the sponsor affect only proposed investments for which an eligible business firm applies for authorization after the date of adoption.

(9) The sponsor may impose the additional conditions only pursuant to a policy and standards that:

(a) Entail the adoption by the zone sponsor of formal documentation outlining the sponsor’s purposes, process, factors of consideration and so forth; and

(b) Contain standards consisting of established and transparent measures, methods or criteria to implement the policy and define the conditions, as well as specific consequences for the firm’s failure to satisfy those conditions.

(10) Any imposed additional condition must relate in some way to employment opportunities for one or more groups of persons, through:

(a) Actions by the eligible business firm;

(b) Use of funds or resources from the firm;

(d) Other means, for which the result is employment-related benefits for groups of persons, consistent with 47 OTR 557 (TC 4167, 1999, Regular Division of the Oregon Tax Court).

(11) Any urban zone sponsor that has established and implemented a policy and standards described in this rule shall submit a report under ORS 285C.150(6), which:

(a) Is due on or about the anniversary date of the policy’s adoption every four years;

(b) Shall be done primarily through the offices of the State Senate President and the Speaker of the Oregon House of Representatives; and

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.150
OBDD 31-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 9-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 8-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 13-2015, f. & cert. ef. 11-12-15
OBDD 26-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-668-3000 REQUSITE OPENNESS & COMMUNICATION — Posted Agreements

For purposes ORS 285C.163 and 285C.407:

(1)(a) A written agreement under ORS 285C.160 or 285C.403(4) between a business firm and an enterprise zone sponsor does not come into effect until it has been posted online for at least 21 days.

(b) The online posting shall be on the website of at least one cosponsor of the enterprise zone; and

(c) The zone co/sponsor is solely for responsible for determining: Appropriate place at website for posting, ways to draw attention to it, whether to extend posting beyond 21 days, otherwise making it or related information publicly available, any opportunity for public response, or the like.

(2) The posting in section (1) of this rule shall include but is not limited to:

(a) Explanation or introduction offering context; and

(b) The full text or at least all substantive parts of the written agreement, including but not limited to any requirement imposed on the business firm as described in OAR 123-668-2000 to 123-668-2500:

(A) As the agreement is at least expected to be executed consistent with section (3) of this rule; but

(B) With requisite redactions that:

(i) Prevent publicizing the firm’s identity or any confidential, proprietary, or otherwise sensitive or legally protected data about parties to the agreement or proposed investment or operations of the firm.

(ii) Do not contravene legal provisions for public disclosure of the associated application for authorization or certification, once approved, or other public records, if requested, notwithstanding exemptions under ORS 285C.145(4) or other laws.

(3) At the time of posting in section (1) of this rule:

(a) Options for the current state of the agreement include but are not limited to its being:

(A) A final draft to which the sponsor and business firm might make limited changes after the 21 days;

(B) Fully finalized and taking effect, as is, on or after it is signed following the 21 days; or

(b) Likewise, specific resolutions described in OAR 123-668-2450 may or may not yet be adopted.

(4) This rule is not discernibly relevant for any other situation, except as described in subsection (1)(a) of this rule, but possibly for situations applicable to OAR 123-668-2000(2)(b) to (d) or otherwise, if somehow involving a/another written agreement:

(a) Between a business firm and the sponsor of an enterprise zone regarding use of the zone; and

(b) Suitable and understandable for posting on a local government website as described by this rule.

History

Statutory/Other Authority: ORS 285A.070, 285C.060(1), 285C.163(1)(b) & 285C.407(1)(b)
Statutes/Other Implemented: ORS 285C.160, 285C.163, 285C.403 & 285C.407
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-668-3500 Infrastructure in Neighboring Jurisdictions

Under ORS 285C.142 and 285C.404, for any situation relevant to OAR 123-668-3000, if the zone sponsor determines that future investments or operations of the business firm in using the enterprise zone will potentially have an impact on infrastructure within the jurisdiction of a local government aside from any government that (co)sponsors the zone, then the sponsor shall give notice to that government:

(1) The notice shall occur as soon as possible after the determination is made, before entering into an agreement with the business firm, and shall describe the potential impact in writing.

(2) Local governments include any city, county or local service district, or any subdivision of the same, with territory adjacent to but outside any sponsoring government and inside this state, regardless that:

(a) Its jurisdiction also extends within the boundary of the zone or that of a sponsoring government;

(b) It is a district listed under ORS 174.116, 198.010 or 198.080;

(d) It does not provide or support the infrastructure.

(3) A relevant impact is any substantial interference with or significantly increased demand or burden on the availability or provision of infrastructure inside the local government, including but not limited to:

(a) Roads, transportation, shipping or transit;

(b) Systems or facilities for sanitary sewer, stormwater, or water quality or supply;

(d) Telecommunication or broadband;

(e) Sanitation or waste disposal services;

(f) Housing resources; or

(g) Emergency or public safety response.

(4) If the impact is not recognized until after entering into the agreement, the zone sponsor may still give notice.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.142, 285C.160, 285C.403 & 285C.404
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-668-4000 SUPPORT FEES FOR OREGON SCHOOLS — Applicability and Rate Setting

Under ORS 285C.162 and 285C.405, for purposes of school support fee rates in an agreement between a business firm and the sponsor of an enterprise zone under ORS 285C.160 and 285C.403(4), exclusively as described in OAR 123-668-2000(1) or (2)(a):

(1) Such an agreement must stipulate the fee rate established by the zone sponsor and the common or union high school district that:

(a) Provides elementary and secondary education (exclusive of community college, educational service or any other district); and

(b) Would otherwise receive property tax revenue on property of the firm inside the enterprise zone.

(2) The fee rate in conformance with OAR 123-668-4100 may be established by the sponsor and school district, either:

(a) With zone designation or re-designation according to OAR 123-650-5300; or

(b) At some point on or after September 24, 2023, if the enterprise zone already exists on that date, but before the earlier of:

(A) The effective date of the zone’s termination; or

(B) January 2, 2028.

(3) The fee rate shall be mutually established in a documentable way:

(a) Acceptable to the school district’s officials and its board, as well as governments that (co)sponsor the enterprise zone at least in consultation with their governing bodies;

(b) Including but not limited to the following, which may differ between or among the school district and cosponsors of the zone:

(A) Exchange of letters;

(B) Memorandum of understanding;

(D) Official votes or adoption of resolutions or other instruments by respective governing bodies; and

(c) Without necessarily negotiating other terms or conditions, although arrangements or plans to formalize arrangements for purposes of OAR 123-668-4200 and 123-668-4300 are advisable.

(4) Documents pursuant to subsection (3)(b) of this rule shall at a minimum:

(a) Set and specify the rate as a percentage;

(b) Provide context in terms of the enterprise zone’s name and the implementation of state law for school support fees to be paid by businesses in the zone;

(d) Contain signatures of representatives or officials for the zone sponsor and school district; and

(e) Be retained by the sponsor and district, but they need not be transmitted to a state agency in the case of subsection (2)(b) of this rule.

(5) This rule applies to agreements between zone sponsors and business firms:

(a) Only if entered into on or after September 24, 2023, under ORS 285C.160 or 285C.403(4)(b).

(b) In all enterprise zones or rural renewable energy development (RRED) zones, but the sponsor and any relevant school district may in the case of a:

(A) RRED Zone, establish the fee rate at any time, regardless of paragraph (2)(b)(B) of this rule, including but not limited to re-/designation under ORS 285C.353.

(B) Federally based enterprise zone, reservation enterprise zone or reservation partnership zone:

(i) Establish the fee rate at any time on or before January 1, 2028; or

(ii) Set, reset or continue to use a previously established rate after January 1, 2028, as part of the process for re-/designation under ORS 285C.085 or 285C.306.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.067, 285C.160, 285C.162, 285C.403, 285C.405 & OrLaws 2023 ch. 298 §§53, 54 & 55
OBDD 54-2024, amend filed 12/12/2024, effective 12/12/2024
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-668-4100 Fee Rate Characteristics

As established according to OAR 123-650-5300 or 123-668-4000, the fee rate for school support:

(1) Must be exactly the same for every agreement under ORS 285C.160 or 285C.403(4) with any business firm with exempt property inside the same area that is shared by the enterprise zone and the school district.

(2) Shall be either 22.5% or a whole percentage (without any decimal) in the range of 15.0% to 30.0%.

(3) May not change until the enterprise zone is (again) re‑designated.

(4) May be set:

(a) In an enterprise zone for which the boundary encompasses territory of multiple school districts:

(A) Independently with each district, regardless of setting a rate that is different or the same with any other school district; or

(B) Jointly at the same percent with two or more districts, including but not necessarily with all such districts.

(b) Jointly by two or more enterprise zones at the same percent with any school district that contains territory inside all of the zones’ boundaries.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.067, 285C.160, 285C.162, 285C.403, 285C.405 & OrLaws 2023 ch. 298 §§53, 54 & 55
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-668-4200 Fee Payment and Administration

For purposes of an agreement between an enterprise zone sponsor and a business firm and the school support fee rate as described in OAR 123-668-4000 and 123-668-4100:

(1) Fees are not collected for:

(a) The first, second or third year of any standard exemption period under ORS 285C.175; or

(b) A year preceding the sixth year of exemption on any long-term rural facility under ORS 285C.409(1)(c).

(2) For other years, the fee is based on that year’s property tax savings due to the exemption, which pursuant to the current certified property tax assessment roll:

(a) Correspond to what is entered on the rolls under ORS 285C.175(7)(b) or 285C.409(3)(b);

(b) Include all taxing districts in each tax code area containing exempt property inside the school district (not only the school district’s forgone taxes);

(c) Would be the best estimate accounting for significant factors under state law, such as market valuation, maximum assessed value, and the tax rate to have been effectively imposed on exempt property including, as practicable, compression or urban renewal division of tax revenue, as if there were no exemption; and

(d) Are not affected by any other fee or payment related to the same tax savings or by any discount or circumstance as if property taxes were actually paid.

(3) With any applicable exemption year, the zone sponsor/local zone manager shall:

(a) In October, seek information from the county assessor of estimated property tax savings consistent with section (2) of this rule that is broken out by relevant business firm and each school district in which any firm has applicably exempt property; and

(b) By November 1, communicate or deliver to appropriate administrators of any relevant school district:

(A) A copy of the respective agreement;

(B) Current status and applicable year of each business firm’s exemption;

(D) Complete, up-to-date information for effectively contacting and soliciting payment from each firm.

(4) School district officials correctly in receipt of information in subsection (3)(b) of this rule:

(a) Shall ensure that any affected business firm receives notice on or before December 1 for the amount and calculation of the fee due, with instructions to successfully make payment by December 31 and to promptly receive proof of payment;

(b) May make use of:

(A) Electronic systems to handle transactions;

(B) Certified mail or other means to verify or record exchanges; or

(5) Fee money paid by a business firm is credited to the school district as local revenue in direct relation to the associated exempt property of the firm located only in that district, irrespective of:

(a) Paragraph (4)(b)(C) of this rule; or

(b) The existence of any other school district inside the enterprise zone.

History

Statutory/Other Authority: ORS 285C.075, 285C.060(1) & 285C.067(2)
Statutes/Other Implemented: ORS 285C.160, 285C.162, 285C.403 & 285C.405
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-668-4300 Fee Delinquency

In relation to the school support fee in an agreement entered into between a zone sponsor and a business firm under ORS 285C.160 or 285C.403(4):

(1) Pursuant to timely notice in OAR 123-668-4200(4), except as otherwise specified in the agreement according to section (3) of this rule:

(a) On January 1 following the exemption year of the property tax savings on which the fee is based, any unpaid fee amount becomes delinquent, to which the business firm should be alerted;

(b) After March 1 but no later than April 1, the school district may give notice in writing to the business firm and to the county assessor of the fee amount remaining unpaid under ORS 285C.162(5)(a) or 285C.405(5)(a) along with a copy of notice from OAR 123-668-4200(4); and

(2) In relation to setting the fee rate or at any time after doing so, the zone sponsor and the school district may also formally establish certain provisions to be used with every agreement under ORS 285C.162(3)(c) and 285C.405(3)(c), such that:

(a) The arrangements would supersede section (1) of this rule if duly incorporated in the agreement; and

(b) The county assessor’s involvement in devising such arrangements is advisable.

(3) Whether based on arrangements in section (2) of this rule or not, the agreement may specify under ORS 285C.162(3)(c) or 285C.405(3)(c):

(a) A date between January 1 and March 31, on which any unpaid fee becomes delinquent, in lieu of subsection (1)(a) of this rule;

(b) For purposes of the school district’s giving notice, in lieu of subsection (1)(b) of this rule:

(A) The earliest that such notice may occur, not less than 61 days after the date of delinquency in subsection (a) of this section; and

(B) The latest that such notice may occur, on or before June 30 at the end of the tax year;

(A) The rate at which interest on unpaid amount accrues, not to exceed 1 percent per month, between the date of delinquency in subsection (a) of this section and the latter of the date on which the school district:

(i) Has effectively been paid in full; or

(ii) Gives notice in subsection (b) of this rule; and

(B) The amount of penalty added to unpaid amount, not to exceed 25% of that amount in total, on the date of:

(i) Delinquency in subsection (a) of this section; or

(ii) Notice in subsection (b) of this section.

(4) For purposes of section (3) of this rule:

(a) Any unpaid fee amount includes but is not limited to outstanding interest or penalty, less any refund due to the firm under ORS 285C.162(4) or 285C.405(4).

(b) The agreement may also contain:

(A) Additional provisions that complement ORS 285C.162 or 285C.405, including but not limited to arrangements that facilitate payment or offset administrative costs for the school district; and

(B) Further details or contingencies that conform to parameters in section (3) of this rule, including but not limited to curing delinquency by payment in full, for which the agreement shall stipulate:

(i) Deadlines for curing in relation to dates as addressed in subsection (3)(b) of this rule; and

(ii) How timely cure affects interest or penalties as addressed in subsection (3)(c) of this rule.

(5) Pursuant to notice in subsection (1)(b) or (3)(b) of this rule for action by the county assessor under ORS 285C.162(5)(b) or 285C.405(5)(b):

(a) Only future years of exemption consistent with OAR 123-668-4200(1), if any remain, under the same authorization or certification of the business firm are forfeit, such that disqualification does not include back taxes.

(b) The unpaid amount of the fee with any associated interest or penalty, as described in subsection (3)(c) of this rule, is billed as part of general property tax collections, such that no funds are reserved for or distributed to the school district or to educational systems more generally.

(6) If the business firm receives the notice in OAR 123-668-4200(4) late, it may still make payment, but it is not subject to delinquency or any consequence of not paying in full, including but not limited to ORS 285C.162(5) and (6) or 285C.405(5) and (6).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.160, 285C.162, 285C.403 & 285C.405
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Division 670 JOBS CREATION TAX CREDIT

Or. Admin. R. 123-670-0001 Temporary rule language in effect until 12/01/2026. Purpose and Scope

(1) The purpose of OAR 123-670-0001 through 123-670-0110 is to implement Oregon Laws 2026, chapter 142, section 12 to 15 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084), which establishes the Qualified Jobs Creation Tax Credit (QJCTC). These rules establish the procedures, standards, and criteria for the administration of the QJCTC, including taxpayer application and certification of eligibility, administration of the annual program credit cap, conditions for revocation of a certification, and provision of certification information to the Oregon Department of Revenue.

(2) The Oregon Business Development Department (OBDD) is the administering agency for QJCTC certification under these rules. The Oregon Department of Revenue administers the credit as claimed on Oregon tax returns under ORS chapter 316, 317, or 318.

(3) These rules apply to any taxpayer seeking certification of eligibility for the QJCTC for tax years beginning on or after January 1, 2026, and before January 1, 2032.

(4) For definitions used in this division of administrative rules, see OAR 123-001 (Procedural Rules) and OAR 123-670-0010.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0010 Temporary rule language in effect until 12/01/2026. Definitions

(1) For the purposes of OAR 123-670-0001 through 123-670-0110, in addition to definitions found in OAR 123-001-0050 (Procedural Rules), the following terms have the meanings set forth below, unless the context clearly indicates otherwise.

(2) "Annual Program Cap" means the maximum total amount of tax credits that may be certified by OBDD for all taxpayers for a single tax year, as established by statute at $12,500,000.

(3) "Application Period" means the period established by OBDD during which taxpayers may submit applications for certification for a given tax year, as published by OBDD no later than June 30 for each program year.

(4) "Authorized Representative" means an individual who has legal authority to act on behalf of a taxpayer and to make legally binding attestations on its behalf, including an officer, owner, or professional representative such as a licensed tax preparer or attorney designated by the taxpayer for purposes of the application.

(5) "Average Annual Covered Employment" means the average number of covered employees for whom a taxpayer paid Oregon unemployment insurance contributions during a 12-month measurement period, calculated by summing the number of qualifying covered employees in each of the 12 calendar months of the measurement period and dividing by 12. The result is rounded to the nearest whole number using standard rounding. A covered employee is included in a monthly count only if the employee's hourly rate of compensation, or effective hourly rate as defined in OAR 123-670-0010(7), met or exceeded the wage threshold as defined in OAR 123-670-0010(17) during that month.

(6) "Certification" means a written determination issued by OBDD confirming the taxpayer's eligibility for the Qualified Jobs Creation Tax Credit and stating the amount of credit to which the taxpayer is entitled for the applicable tax year.

(7) "Compensation" means all financial payments received by an employee from the taxpayer, including base wages or salary, bonuses, commissions, and other cash payments made directly to the employee as remuneration for work performed. Compensation does not include non-financial benefits such as health insurance, retirement plan contributions, paid leave, employee discounts, or other benefits that do not constitute a direct cash payment to the employee. For purposes of determining the wage threshold under these rules, compensation is expressed as an hourly rate as follows:

(a) For employees paid an hourly wage, the hourly rate is the employee's actual hourly rate of pay;

(b) For salaried employees, the hourly rate is determined by dividing the employee's regular weekly salary by the employee's standard scheduled weekly hours; and

(c) For employees whose compensation includes variable elements such as bonuses or commissions, the hourly rate is determined by dividing the employee's total compensation paid during the applicable calendar month by the total hours worked during that month.

(8) “Covered Employee” means an individual that provides services to an employer in exchange for renumeration and for whom the taxpayer is required to pay unemployment insurance contributions under ORS chapter 657.

(9) "NAICS Code" means a numeric code assigned under the North American Industry Classification System, as published by the United States Office of Management and Budget, that classifies a business establishment based on its primary economic activity. For rules governing which edition of NAICS applies under these rules, see OAR 123-670-0011.

(10) "Net New Jobs" means the positive difference, if any, between a taxpayer's average annual covered employment for the 12 months ending June 30 of the calendar year in which the taxpayer's tax year began and the taxpayer's average annual covered employment for the 12 months ending June 30 of the immediately preceding calendar year, as further defined in OAR 123-670-0070.

(11) "Primary Business Activity" means the business activity that accounts for the largest share of a taxpayer's total receipts or, where receipts do not accurately reflect the amount of business activity, the business activity that is associated with the largest share of the taxpayer's total employment, when compared to all other activities conducted by the taxpayer.

(12) "Qualified Industry" means a sector described in OAR 123-670-0011 and as defined in Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084).

(13) “Qualified Jobs Creation Tax Credit” or “QJCTC” means the tax credit allowed under Oregon Laws 2026, chapter 142, section 12 to 15 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084).

(14) "Successor" means an individual or corporation, partnership, limited liability company, or other legally recognized business organization that continues, absorbs, or acquires the business operations of a predecessor through a merger, conversion, reorganization, consolidation, or acquisition, such that the two share a predecessor/successor relationship for purposes of determining average annual covered employment under these rules.

(15) "Tax Year" means the tax year of the taxpayer as defined for purposes of ORS chapter 316, 317, or 318.

(16) "Taxpayer" means an individual, corporation, or other legally recognized business organization that is seeking or has received certification under these rules. See OAR 123-670-0015 for rules governing taxpayer identification and filing structure.

(17) "Wage Threshold" means the minimum hourly rate of compensation required for a covered employee to be included in the calculation of average annual covered employment under these rules, equal to 150 percent of the applicable Oregon minimum wage as determined under ORS 653.025 for the county in which the employee's primary work is performed. The wage threshold is applied on an hourly basis to each individual covered employee's hourly rate of compensation as defined in section (6) of this rule, regardless of whether the employee works full-time, part-time, or on a seasonal or temporary basis. A covered employee whose hourly rate of compensation does not meet the wage threshold in a given calendar month is excluded from the monthly covered employee count for that month and does not contribute to average annual covered employment for purposes of these rules.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0011 Temporary rule language in effect until 12/01/2026. Qualified Industry Definitions

(1) This rule defines the qualified industries eligible for the Qualified Jobs Creation Tax Credit. A taxpayer must have its primary business activity in one of these industries to be eligible for certification.

(2) A business whose primary business activity consists of providing services, supplies, or other support to a qualified industry, but that does not itself operate within a qualified industry as defined in this rule, is not eligible solely based on that relationship.

(3) Corporate headquarters, regional administrative offices, and support offices whose primary function is to serve, manage, or support an employer whose primary business activity is in a qualified industry are included within the relevant qualified industry definition, provided the taxpayer demonstrates that its underlying operations are principally within that qualified industry.

(4) Each qualified industry definition in this rule includes a list of North American Industry Classification System (NAICS) codes at the four-digit industry group level associated with that industry. A taxpayer whose NAICS code, whether reported at the four-digit, five-digit, or six-digit level, begins with one of the four-digit codes listed for the applicable qualified industry is presumed to operate within that qualified industry for purposes of Option A eligibility under OAR 123-670-0020(1)(a)(A). A taxpayer whose NAICS code does not begin with any four-digit code listed in this rule must demonstrate eligibility through Option B under OAR 123-670-0020(1)(a)(B) by submitting a written statement as provided in OAR 123-670-0040.

(5) The qualifying NAICS codes listed in this rule are drawn from the most current edition of the North American Industry Classification System published by the United States Office of Management and Budget at the time of the applicable application period. When a new edition of NAICS is published, OBDD will review the qualifying NAICS code lists in this rule and update them through rulemaking as necessary to reflect code changes. For the first application period following publication of a new NAICS edition, a taxpayer whose code has been renumbered in the new edition may use either the prior or current edition code in their application, and OBDD will evaluate the application based on whichever code corresponds to the taxpayer's primary business activity under the applicable qualified industry definition.

(6) "Advanced Manufacturing" has the meaning given in Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084).

(7) Qualifying NAICS codes for Advanced Manufacturing: 3254 (Pharmaceutical and Medicine Manufacturing), 3311 (Iron and Steel Mills and Ferroalloy Manufacturing), 3312 (Steel Product manufacturing from Purchased Steel), 3313 (Alumina and Aluminum Production and Processing), 3314 Nonferrous Metal except Aluminum Production and Processing), 3315 (Foundries), 3321 (Forging and Stamping), 3323 (Architectural and Structural Metals Manufacturing), 3329 (Other Fabricated Metal Product Manufacturing), 3331 (Agriculture, Construction, and Mining Machinery Manufacturing), 3332 (Industrial machinery Manufacturing), 3334 (Ventilation, Heating, Air-Conditioning, and Commercial Refrigeration Equipment Manufacturing), 3336 (Engine, Turbine, and Power Transmission Equipment Manufacturing), 3339 (Other Industrial Machinery Manufacturing), 3344 (Semiconductor and Other Electronic Component Manufacturing), 3345 (Navigational, Measuring, Electromedical, and Control Instruments Manufacturing), 3361 (Motor Vehicle Manufacturing), 3364 (Aerospace Product and Parts Manufacturing), 3369 (Other Transportation Equipment Manufacturing), 4238 (Machinery, Equipment, and Supplies Merchant Wholesalers).

(8) "Bioscience and Biotechnology" means the research, development, manufacture, or commercialization of products or processes derived from or dependent upon biological systems, living organisms, or their derivatives, including but not limited to:

(a) Pharmaceuticals, biologics, and therapeutic drugs;

(b) Medical devices, diagnostic equipment, and laboratory instruments;

(d) Industrial biotechnology, including biofuels, bioplastics, and bio-based chemicals; and

(e) Research tools, laboratory services, and enabling technologies directly integral to the development or production or bioscience or biotechnology products.

(9) Bioscience and Biotechnology does not include the retail sale of pharmaceutical products, provision of clinical healthcare services to patients, or provision of general laboratory, testing, or analytical services that are not directly integral to the development or production of a bioscience or biotechnology product.

(10) Qualifying NAICS codes for Bioscience and Biotechnology: 3251 (Basic Chemical Manufacturing), 3252 (Resin, Synthetic Rubber, and Artificial and Synthetic Fibers and Filaments Manufacturing), 3253 (Pesticide, Fertilizer, and Other Agricultural Chemical Manufacturing), 3254 (Pharmaceutical and Medicine Manufacturing), 3259 (Other Chemical Product and Preparation Manufacturing), 3391 (Medical Equipment and Supplies Manufacturing), 4242 (Drugs and Druggists’ Sundries Merchant Wholesalers), 4246 (Chemical and Allied Products Merchant Wholesalers), 5417 (Scientific Research and Development Services).

(11) "Clean Technology" has the meaning given in Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084) and includes but is not limited to: solar, wind, geothermal, and other renewable energy equipment manufacturing and/or installation; energy storage and battery technology; energy efficiency products and systems; electric vehicle components and charging infrastructure; green building materials and systems; water treatment and conservation technology; and environmental remediation technology.

(12) Clean Technology does not include the generation, transmission or distribution of energy as a utility, provision of environmental consulting or compliance services that do not involve the manufacture or development of clean technology products or the retail sale of clean technology products.

(13) Qualifying NAICS codes for Clean Technology: 3353 (Electrical Equipment Manufacturing), 3359 (Other Electrical Equipment and Component Manufacturing), 3369 (Other Transportation Equipment Manufacturing), 5417 (Scientific Research and Development Services), 3559 (Special Industry Machinery Manufacturing).

(14) "Food and Beverage Processing" means the transformation of raw agricultural commodities, ingredients, or other inputs into finished or semi-finished food or beverage products intended for wholesale distribution or further commercial sale, including but not limited to:

(a) Processing, canning, freezing, drying, or otherwise preserving food products;

(b) Milling, grinding, pressing, or refining of grains, oils, or other raw materials into food ingredients or finished products;

(d) Manufacturing of food ingredients, flavorings, additives, or related products.

(15) Food and Beverage Processing does not include retail food service, including restaurants, cafes, food carts, and catering operations; retail grocery or specialty food stores; or provision of food safety testing, inspection, or consulting services that do not involve the manufacture of a food or beverage product.

(16) Qualifying NAICS codes for Food and Beverage Processing: 1125 (Aquaculture), 3111 (Animal Food Manufacturing), 3112 (Grain and Oilseed Milling), 3113 (Sugar and Confectionery Product Manufacturing), 3114 (Fruit and Vegetable Preserving and Specialty Food Manufacturing), 3115 (Dairy Product Manufacturing), 3116 (Animal Slaughtering and Processing), 3117 (Seafood Product Preparation and Packaging), 3118 (Bakeries and Tortilla Manufacturing), 3119 (Other Food Manufacturing), 3121 (Beverage Manufacturing), 4244 (Grocery and Related product Merchant Wholesalers), 4245 (Farm Product Raw Material Merchant Wholesalers), 4248 (Beer, Wine, and Distilled Alcoholic Beverage Merchant Wholesalers).

(17) "Forestry and Wood Products" means the harvesting of timber and the manufacturing or processing of wood-based materials and products, including but not limited to:

(a) Timber harvesting, logging, and forest management operations;

(b) Sawmill and lumber manufacturing, including primary and secondary wood processing;

(c) Plywood, veneer, engineered wood, and mass timber product manufacturing, including cross-laminated timber and other innovative wood composites;

(d) Wood pulp, paper, and paperboard manufacturing; and

(e) Millwork, cabinetry, furniture, and other value-added wood product manufacturing.

(18) Forestry and Wood products does not include the retail sale of lumber or building materials, landscape or grounds maintenance services, provision of forestry consulting, planning, or environmental assessment services that do not involve timber harvesting or wood product manufacturing, or construction activities using wood products.

(19) Qualifying NAICS codes for Forestry and Wood Products: 1131 (Timber Tract Operations), 1132 (Forest Nurseries and Gathering of Forest Products), 1133 (Logging), 1153 (Support Activities for Forestry), 3211 (Sawmills and Wood Preservation), 3212 (Veneer, Plywood, and Engineered Wood Product Manufacturing), 3219 (Other Wood Product Manufacturing), 3221 (Pulp, Paper, and Paperboard Mills), 3371 (Household and Institutional Furniture and Kitchen Cabinet Manufacturing), 4233 (Lumber and Other Construction materials Merchant Wholesalers), 4241 (Paper and Paper Product merchant Wholesalers).

(20) "High Technology" has the meaning given in Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084).

(21) High Technology includes but is not limited to: software development and publishing; information technology systems design and integration; data processing and cloud computing services; semiconductor fabrication and design; electronic component and circuit board manufacturing; and development or manufacture of electronic devices, instruments, or systems that depend substantially on semiconductor technology.

(22) High Technology does not include the retail sale of technology hardware or software, the provision of general information technology support, help desk, or managed services that do not involve the development of software or technology products, or provision of telecommunications services as a carrier or utility.

(23) Qualifying NAICS codes for High Technology: 3341 (Computer and Peripheral Equipment Manufacturing), 5132 (Software Publishers), 5162 (Media Streaming Distribution Services, Social Networks, and Other Media Networks and Content Providers), 5182 (Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services), 5192 (Web Search Portals, Libraries, Archives, and Other Information Services), 5415 (Computer Systems Design and Related Services), 3344 (Semiconductor and Other Electronic Component Manufacturing), 3345 (Navigational, Measuring, Electromedical, and Control Instruments Manufacturing).

(24) "Outdoor Gear and Apparel" means the development, design, manufacturing, or distribution of gear, equipment, apparel, or footwear intended primarily for use in outdoor recreational or sporting activities, including but not limited to:

(a) Design and manufacturing of outdoor apparel, footwear, and accessories;

(b) Manufacturing of outdoor sporting and recreational equipment, including camping, climbing, paddling, skiing, cycling, hunting, and fishing gear;

(d) Wholesale distribution of outdoor gear, apparel, or equipment where the taxpayer is the brand owner or primary manufacturer of the distributed products.

(25) Outdoor Gear and Apparel does not include the retail sale of outdoor products to end consumers, operation of outdoor recreation facilities, resorts, or guided recreation services, or provision of repair, rental, or resale services for outdoor products.

(26) Qualifying NAICS codes for Outdoor Gear and Apparel: 3132 (Fabric Mills), 3149 (Other Textile Product Mills), 3151 (Apparel Knitting Mills), 3152 (Cut and Sew Apparel manufacturing), 3159 (Apparel Accessories and Other Apparel Manufacturing), 3162 (Footwear Manufacturing), 3161 (Leather and Hide Tanning and Finishing), 3169 (Other Leather and Allied Product manufacturing), 3322 (Cutlery and Handtool Manufacturing), 3399 (Other Miscellaneous Manufacturing), 3362 (Motor Vehicle Body and Trailer manufacturing), 3366 (Ship and Boat Building), 4234 (Professional and Commercial Equipment and Supplies Merchant Wholesalers), 4239 (Miscellaneous Durable Goods Merchant Wholesalers), 4243 (Apparel, Piece Goods, and Notions Merchant Wholesalers).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 15-2026, temporary adopt filed 08/10/2026, effective 08/10/2026 through 12/01/2026
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0015 Temporary rule language in effect until 12/01/2026. Taxpayer Identification and Filing Structure

(1) This rule establishes how the term "taxpayer" is applied for purposes of QJCTC certification and eligibility under these rules, including rules governing individual filers, corporations included in Oregon consolidated returns, and pass-through entities. This rule governs who may apply for certification and at what level eligibility is assessed.

(2) Individual Taxpayers. An individual subject to Oregon personal income tax under ORS chapter 316 who operates a business whose primary business activity falls within a qualified industry as defined in OAR 123-670-0011 may apply for and receive certification under these rules in the same manner as a business organization. Eligibility is assessed based on the individual's business operations, covered employment, and compliance with the wage threshold requirements of OAR 123-670-0020. An individual taxpayer is subject to the same credit cap of $10,000 (up to $1,000/per net new job, up to 10 jobs) per tax year as any other taxpayer.

(3) Corporations Included in Oregon Consolidated Returns.

(a) For purposes of the QJCTC, each corporation included in an Oregon consolidated return filed pursuant to ORS 317.710(5)(c) is treated as a separate taxpayer that may apply for tax credit certification. To be eligible, each such corporation must independently meet all requirements of Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084) and any applicable rules.

(b) Each qualifying corporation in a consolidated group must submit its own separate application for certification under OAR 123-670-0030. The consolidated group itself is not eligible for certification and may not apply as a single taxpayer.

(c) The credit cap of $10,000 (up to $1,000/per net new job, up to 10 jobs) applies separately to each qualifying corporation in the consolidated group.

(d) A corporation applying for certification must attest in its application that the jobs for which certification is sought were created by that corporation, not by any other corporation included in the consolidated return, and that the attesting corporation’s net new jobs are not the basis for a certification application submitted by any other corporation.

(e) Each corporation applying for certification that is part of a consolidated group must identify in its application the corporation that files the Oregon consolidated return on behalf of the group, including the legal name, FEIN, and Oregon business identification number of that filing corporation.

(4) Pass-Through Entities.

(a) A partnership or S corporation that creates net new jobs may apply for and receive certification under these rules.

(b) A partnership or S corporation applying for certification must identify in its application each partner or shareholder to whom the credit will be passed through, including the legal name and FEIN or, for individual partners or shareholders, the Social Security number of each such person, and the percentage of the credit to be allocated to each.

(c) The eligibility requirements of OAR 123-670-0020 and Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084) are assessed at the level of the partnership or S corporation that created the net new jobs.

(5) Combined Credits and Passed-Through Credits.

(a) A corporation, individual, or other taxpayer that independently creates net new jobs may apply for and receive its own certification for those jobs, even if the same taxpayer also receives a QJCTC credit passed through from a pass-through partnership or S corporation of which it is a partner or shareholder.

(b) The credit cap of $10,000 (up to $1,000/per net new job up to 10 jobs) is imposed when a taxpayer is certified for jobs it directly created. It is not applied to any credit passed through to the taxpayer from a pass-through entity, provided the jobs underlying each credit application are distinct.

(c) A taxpayer that both directly creates net new jobs and receives a passed-through credit must attest in its application for certification that the net new jobs for which it seeks certification are distinct from the jobs for which the pass-through entity of which it is a partner or shareholder was certified.

(6) No Double Counting of Jobs. The same jobs may not be the basis for more than one certification under these rules, regardless of the taxpayer structure involved. OBDD may deny or revoke a certification if it determines that the same jobs have been used as the basis for a credit by more than one taxpayer.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0020 Temporary rule language in effect until 12/01/2026. Eligibility Requirements

(1) A taxpayer is eligible to apply for QJCTC certification for a tax year if the taxpayer meets all of the following requirements:

(a) Industry eligibility. The taxpayer's primary business activity during the tax year for which the credit is sought falls within a qualified industry as defined in OAR 123-670-0011. A taxpayer may demonstrate industry qualification by doing one of the following:

(A) Providing the NAICS code used on its most recent federal or Oregon state tax return, Oregon Secretary of State business registration, or Oregon unemployment insurance filing, which must be one of the qualifying NAICS codes listed for the applicable qualified industry in OAR 123-670-0011; or

(B) Submitting a written statement describing how the taxpayer's primary business activity meets the definition of a qualified industry as described in OAR 123-670-0040, including a description of the taxpayer's principal products or services, the share of total receipts or employment attributable to the qualifying activity, and any NAICS code or codes used by the taxpayer.

(b) Attestation regarding eligibility. In all cases, the taxpayer must attest to eligibility for the tax credit. A false or misleading attestation may result in revocation of the certification. OBDD may request additional documentation in support of claimed qualification as part of the application review process.

(c) Creation of net new jobs. The taxpayer must have created one or more net new jobs during the tax year, as calculated under OAR 123-670-0070.

(d) Wage threshold. Each position counted toward net new jobs must be paid an hourly rate of compensation, as defined in OAR 123-670-0010(7), equal to or greater than 150 percent of the applicable Oregon minimum wage under ORS 653.025 for the county in which the employee's primary work location is situated. The wage threshold is evaluated on a look-back basis using the employee's actual hourly rate of compensation paid during the measurement period. A taxpayer may satisfy this requirement by attesting that all counted positions met the wage threshold during the measurement period. OBDD may establish simplified calculation methods by which taxpayers demonstrate compliance, including use of monthly payroll records, quarterly wage reports, or other equivalent documentation as specified in the application form.

(e) Certification. The taxpayer has received written certification of eligibility from OBDD prior to claiming the credit on an Oregon tax return.

(2) A taxpayer is not eligible for certification under these rules solely on the basis that the taxpayer provides services, supplies, or other support to a business operating in a qualified industry, if the taxpayer's own primary business activity does not independently fall within a qualified industry as defined in OAR 123-670-0011.

(3) A taxpayer that has had a certification revoked under ORS 315.061 and OAR 123-670-0100 may not apply for certification for any tax year subsequent to the tax year for which the certification was revoked.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0030 Temporary rule language in effect until 12/01/2026. Application Requirements

(1) Application Period. OBDD shall announce the tax credit certification application period for each tax year on its website no later than June 30 of the calendar year in which the tax year begins. The application period shall open no earlier than July 1 and close no later than October 31 and shall remain open for a minimum of six consecutive weeks. Applications submitted after the close of the application period will not be accepted.

(2) Submission. Applications must be submitted through OBDD's online application portal in the form and manner prescribed by OBDD. An application is not considered submitted until it has passed automated completeness screening as described in section (4) of this rule. OBDD is not required to notify an applicant of deficiencies in a submitted application.

(3) Eligibility to Apply. Only taxpayers that meet the eligibility requirements of OAR 123-670-0020 may apply for certification. A taxpayer may submit only one application per tax year.

(4) Automated Completeness Screening. The online application portal will perform automated completeness screening at the time of submission. An application that does not include all required information and documentation as described in section (5) of this rule will not be accepted by the portal and will be considered not submitted. An application that passes automated completeness screening is considered submitted as of the date and time of submission. Passing automated completeness screening does not constitute a determination of eligibility or approval of the application.

(5) Required Application Content. A complete application must include all of the following:

(a) Taxpayer identification. The legal name of the taxpayer, federal employer identification number (FEIN) or Social Security Number, Oregon business identification number (BIN), mailing address, and contact information for the authorized representative submitting the application. See OAR 123-670-0015(3)(e) and OAR 123-670-0015(4)(b) for information required for consolidated return filers and pass-through entities.

(b) Authorized representative. The name, title, and contact information of the authorized representative, as defined in OAR 123-670-0010(4), and an attestation that the representative has legal authority to act on behalf of the taxpayer.

(d) Industry eligibility. A demonstration of industry eligibility, as provided in OAR 123-670-0020(1)(a)(A) or OAR 123-670-0020(1)(a)(B).

(e) Employment and wage worksheet. A completed employment and wage worksheet in the form prescribed by OBDD, which must include:

(A) The taxpayer's total covered employees and calculated average annual covered employment, expressed as the average monthly count of qualifying covered employees, rounded to the nearest whole number, for the 12-month measurement period ending June 30 of the calendar year immediately preceding the calendar year in which the tax year began (the "baseline period");

(B) The taxpayer's total covered employees and calculated average annual covered employment, expressed as the average monthly count of qualifying covered employees rounded to the nearest whole number, for the 12-month measurement period ending June 30 of the calendar year in which the tax year began (the "current period");

(C) The calculated number of net new jobs, equal to the positive difference between the current period average annual covered employment and the baseline period average annual covered employment, not to exceed 10;

(D) For each position counted as a net new job, the county of the employee's primary work location, the applicable Oregon minimum wage rate for that county under ORS 653.025, and an attestation that the position's hourly rate of compensation met or exceeded 150 percent of that minimum wage rate during the current measurement period; and

(E) The credit amount requested, calculated as the number of net new jobs, up to 10, multiplied by $1,000.

(f) Attestations. The authorized representative must attest that the taxpayer meets all eligibility requirements for the tax credit. If the taxpayer experienced a merger, conversion, reorganization, consolidation, or acquisition during or between the measurement periods as described in OAR 123-670-0080, the taxpayer must attest that:

(A) The taxpayer experienced a qualifying transaction described in OAR 123-670-0080(2) during or between the measurement periods;

(B) The adjusted baseline period calculation includes the covered employment of the predecessor entity or acquired portion as required by OAR 123-670-0080;

(C) The net new jobs reported in the employment and wage worksheet reflect organic new job creation and not employment transferred, acquired, or otherwise consolidated through the qualifying transaction; and

(D) The predecessor business records used to calculate the adjusted baseline are accurate and were obtained from reliable sources.

(6) Amendments. A submitted application may be amended by the taxpayer at any time prior to the close of the application period. An amendment submitted after the close of the application period will not be accepted, except as provided in section (7) of this rule. The amended application must pass automated completeness screening at the time of resubmission. The date of the amendment, not the original submission date, controls for purposes of cap administration under OAR 123-670-0060 if the amendment increases the credit amount requested.

(7) Downward Corrections After Certification. If a taxpayer determines after receiving certification that the certified credit amount was based on an overstatement of the taxpayer's actual net new jobs, the taxpayer must notify OBDD in writing of the correct number of net new jobs. OBDD shall issue a revised certification reflecting the corrected amount of the tax credit and notify the Oregon Department of Revenue of the revision.

(8) Retention of Records. The taxpayer must retain all records supporting the application, including payroll records, quarterly unemployment insurance reports, wage documentation, and records supporting the industry eligibility determination, for a minimum of five years from the date of certification. Records must be made available to OBDD upon request.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0040 Temporary rule language in effect until 12/01/2026. Qualified Industry Determination for Applicants Without a Listed NAICS Code

(1) Applicability. This rule applies to taxpayers who demonstrate industry eligibility under OAR 123-670-0020(1)(a)(B) by submitting a written statement in lieu of a listed NAICS code. Review Process. OBDD shall review written statement submissions concurrently with the eligibility and application review process under OAR 123-670-0050. Applications that include a written statement submitted prior to the close of the application period will be reviewed on a rolling basis upon submission. The written statement determination is not a separate process from application review; OBDD will issue a single determination addressing taxpayer eligibility.

(2) Standard of Review. OBDD shall evaluate a written statement submission solely on the basis of whether the taxpayer's described primary business activity falls within the definition of a qualified industry as set forth in OAR 123-670-0011. OBDD will not consider economic development intent, regional priorities, or other factors outside the qualified industry definitions in making this determination.

(3) Denial of Written Statement. If OBDD determines that a taxpayer's written statement does not demonstrate that the taxpayer's primary business activity falls within a qualified industry as defined in OAR 123-670-0011, OBDD shall issue a written denial to the taxpayer in the certification notice issued under OAR 123-670-0050(5).

(4) Carryforward of Favorable Determinations.

(a) A taxpayer that received a favorable written statement determination in a prior tax year is not required to resubmit a written statement in a subsequent tax year, provided that:

(A) The taxpayer attests in each subsequent application that its primary business activity remains the same as described in the prior favorable determination; and

(B) The qualified industry definitions in OAR 123-670-0011 have not changed in a manner that affects the basis of the prior favorable determination since the determination was issued.

(b) OBDD retains the right to revisit a prior determination if the qualified industry definitions in OAR 123-670-0011 are amended through rulemaking. If a change occurs to the applicable qualified industry definition that affects the basis for a prior favorable determination, the taxpayer must submit a new written statement in the tax year following the effective date of the amended rule.

(c) A taxpayer seeking to rely on a prior favorable determination must identify in its application the tax year in which the favorable determination was issued. OBDD may request documentation of the prior determination.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0050 Temporary rule language in effect until 12/01/2026. Certification Process

(1) Overview. OBDD shall review all timely and complete applications submitted under OAR 123-670-0030 in accordance with this rule. OBDD will issue certifications after the close of the application period.

(2) Application Tracking Number. Upon acceptance of a complete application, OBDD will assign a unique application tracking number to the application.

(3) Review of Applications. Following the close of the application period, OBDD will review all timely and complete applications for compliance with eligibility and application requirements.

(4) Denial of Applications. OBDD shall deny an application if:

(a) The taxpayer does not meet the eligibility requirements of OAR 123-670-0020;

(b) The application does not comply with the requirements of OAR 123-670-0030, notwithstanding passage of automated completeness screening;

(d) The application contains a material misrepresentation or inaccuracy that affects the eligibility determination.

(5) Certification Notice. Following calculation of any proportionate reduction under OAR 123-670-0060, OBDD shall issue a written certification notice to each approved applicant no later than January 15 of the year following the calendar year in which the application was submitted, except as provided in section (9) of this rule. The certification notice shall constitute the written certification of eligibility required under Oregon Laws 2026, chapter 142, section 12 (SB 1507), as amended by Oregon Laws 2026, chapter 50, section 16 (HB 4084) and shall include:

(a) The taxpayer's legal name and application tracking number;

(b) The tax year for which the credit is certified;

(d) The certified credit amount, reflecting any proportionate reduction applied under OAR 123-670-0060; and

(e) A statement that the certified credit amount is the maximum amount the taxpayer may claim on its Oregon tax return for the applicable tax year, subject to the taxpayer's actual tax liability and applicable carryforward provisions.

(f) If the certified taxpayer is a corporation included in an Oregon consolidated return, the certification notice shall identify the anticipated filer corporation of the consolidated group to which the certified credit is to be reported, consistent with the information provided in the application under OAR 123-670-0030(5)(a) and OAR 123-670-0015. If the certified taxpayer is a partnership or S corporation, the certification notice shall identify the partners or shareholders to whom the credit is to be passed through and the amount allocated to each, consistent with the information provided in the application under OAR 123-670-0030(5)(a) and OAR 123-670-0015.

(6) Downward Corrections. If a taxpayer notifies OBDD of a downward correction pursuant to OAR 123-670-0030(7) after a certification notice has been issued, OBDD shall issue a revised certification notice reflecting the corrected amount.

(7) Extension for Circumstances Outside OBDD's Control. The deadline in section (5) of this rule may be extended if circumstances outside OBDD's control prevent timely issuance of certification notices. OBDD shall notify affected applicants of any extension and the anticipated revised timeline as soon as practicable. OBDD shall make reasonable efforts to minimize any delay and to complete the certification process as soon as possible following resolution of the circumstances causing the delay.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0060 Temporary rule language in effect until 12/01/2026. Annual Program Cap Administration

(1) Annual Program Cap. The total amount of tax credits that may be certified by OBDD for all taxpayers in a single tax year may not exceed $12,500,000, as provided in Oregon Laws 2026, chapter 142, section 12 (SB 1507).

(2) Cap Tracking. OBDD shall track the cumulative total of credit amounts requested by approved applicants following the close of the application period and the completion of eligibility determinations under OAR 123-670-0050.

(3) Determination of Cap Status. Following completion of all eligibility determinations, OBDD shall calculate the total credit amount requested by all approved applicants for the tax year. If the total does not exceed $12,500,000, OBDD shall certify each approved applicant for the full credit amount requested. If the total exceeds $12,500,000, OBDD shall apply a proportionate reduction as provided in section (4) of this rule.

(4) Proportionate Reduction. If the total credit amount requested by all approved applicants exceeds the annual program cap, OBDD shall reduce the certified credit amount for each approved applicant proportionately as follows:

(a) OBDD shall calculate a reduction factor equal to $12,500,000 divided by the total credit amount requested by all approved applicants;

(b) The certified credit amount for each approved applicant shall be equal to the applicant's requested credit amount multiplied by the reduction factor, rounded down to the nearest whole dollar; and

(5) Notification of Proportionate Reduction. If a proportionate reduction is applied, OBDD shall notify all approved applicants of the reduction in the certification notice issued under OAR 123-670-0050(5). The certification notice shall state the applicant's requested credit amount and the resulting certified credit amount.

(6) Reporting. OBDD shall publish annually on its website the total amount of credits certified for each tax year, the number of approved applicants, and whether a proportionate reduction was applied, consistent with the confidentiality requirements of OAR 123-670-0090.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0070 Temporary rule language in effect until 12/01/2026. Net New Job Calculation

(1) Purpose. This rule establishes the methodology for calculating net new jobs for purposes of determining a taxpayer's eligibility and credit amount under these rules. The calculation is based on the change in a taxpayer's average annual covered employment between two consecutive 12-month measurement periods ending June 30, measured as the average monthly count of qualifying covered employees.

(2) Measurement Periods. The net new job calculation uses two consecutive 12-month measurement periods. These measurement periods apply to all taxpayers regardless of whether the taxpayer uses a calendar or fiscal tax year.

(a) Baseline period: The 12 months ending June 30 of the calendar year immediately preceding the calendar year in which the taxpayer's tax year began; and

(b) Current period: The 12 months ending June 30 of the calendar year in which the taxpayer's tax year began.

(3) Average Annual Covered Employment Calculation. A taxpayer's average annual covered employment for each measurement period is calculated as follows:

(a) For each calendar month in the measurement period, count the number of covered employees whose hourly rate of compensation, as defined in OAR 123-670-0010(7), met or exceeded the wage threshold as defined in OAR 123-670-0010(17) during that month. This is the monthly qualifying covered employee count for that month;

(b) Add together the monthly qualifying covered employee counts for all 12 calendar months in the measurement period; and

(c) Divide the sum by 12. Round the result to the nearest whole number using standard rounding. This figure is the taxpayer's average annual covered employment for the measurement period.

(4) Net New Jobs. The number of net new jobs is the positive difference, if any, between the taxpayer's average annual covered employment for the current period and the taxpayer's average annual covered employment for the baseline period. If the current period average annual covered employment does not exceed the baseline period average annual covered employment, the taxpayer has zero net new jobs and is not eligible for the credit for that tax year.

(5) Wage Threshold Application. Only covered employees whose hourly rate of compensation, as defined in OAR 123-670-0010(7), met or exceeded the wage threshold as defined in OAR 123-670-0010(17) during a given calendar month may be included in the monthly qualifying covered employee count for that month. A covered employee whose hourly rate of compensation did not meet the wage threshold in a given month must be excluded from that month's count but may be included in other months where the wage threshold is met. A covered employee who does not meet the wage threshold in any month of the measurement period does not contribute to average annual covered employment for that period.

(6) New Taxpayers. A taxpayer that had no covered employees during the baseline period shall have a baseline period average annual covered employment of zero. The taxpayer's net new jobs shall equal its current period average annual covered employment, subject to the per-taxpayer cap of 10 net new jobs.

(7) Per-Taxpayer Cap. The number of net new jobs counted for purposes of the credit may not exceed 10 for any taxpayer in any tax year. The maximum credit amount for any taxpayer in any tax year is $1,000 multiplied by the number of certified net new jobs, not to exceed $10,000, subject to any proportionate reduction under OAR 123-670-0060.

(8) Seasonal and Temporary Employees. Seasonal and temporary employees are not excluded from the calculation of average annual covered employment, provided they are covered employees who meet the wage threshold in the months they are employed.

(9) Source Records. Taxpayers shall calculate average annual covered employment using any reliable business records that accurately reflect monthly covered employee counts and hourly rates of compensation per covered employee during the measurement period. Reliable business records include but are not limited to payroll system reports, monthly payroll summaries, quarterly unemployment insurance reports, or other employer records maintained in the ordinary course of business. Taxpayers must retain source records in accordance with OAR 123-670-0030(8).

(10) Worksheet. Taxpayers shall report their net new job calculation using the employment and wage worksheet required under OAR 123-670-0030(5)(e). The worksheet shall reflect the calculations described in this rule.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0080 Temporary rule language in effect until 12/01/2026. Net New Job Calculation: Mergers, Acquisitions, and Reorganizations

(1) Purpose. This rule establishes the methodology for calculating net new jobs under OAR 123-670-0070 when a taxpayer has undergone a merger, conversion, reorganization, consolidation, or acquisition during or between the measurement periods. The purpose of this rule is to ensure that employment transferred through a transaction is not counted as net new jobs, and that the credit is available only where employment has genuinely increased above the combined pre-transaction baseline.

(2) Applicability. This rule applies to any taxpayer that, during or between the baseline period and the current period as defined in OAR 123-670-0070(2), experienced one or more of the following events affecting its covered employment:

(a) A merger in which the taxpayer is the surviving entity;

(b) An acquisition of all or part of another entity's business operations, assets, or employees;

(d) A conversion of the taxpayer's legal form that results in a change of employer identity for covered employment purposes; or

(e) Any other transaction or reorganization that results in the taxpayer employing individuals who were previously covered employees of another taxpayer, where that taxpayer shares a predecessor/successor relationship with the taxpayer as defined in OAR 123-670-0010(14).

(3) Internal Reorganizations. A reorganization that changes only the legal form or organizational structure of the taxpayer without resulting in any change in the underlying business operations or covered employment is not subject to this rule. Examples include a conversion from a partnership to a limited liability company or a change in corporate structure where all employees remain employed by the same operating entity.

(4) Predecessor/Successor Framework. When an event described in section (2) of this rule occurs, the following principles apply:

(a) Event occurring before the baseline period. If the event was completed before the start of the baseline period, both the baseline period and the current period reflect the combined taxpayer’s covered employment. No adjustment is required under this rule. The taxpayer calculates net new jobs under OAR 123-670-0070 using its own business records for both periods.

(b) Event occurring between the baseline period and the current period. If the event was completed after the end of the baseline period but before the start of the current period, the taxpayer must adjust the baseline period calculation to include the covered employment of the predecessor taxpayer or acquired portion for the baseline period. The adjusted baseline period average annual covered employment is calculated by:

(A) Calculating the taxpayer's own average annual covered employment for the baseline period using its own business records; and

(B) Adding the average annual covered employment of the predecessor business or acquired portion of the business for the baseline period, expressed as the average monthly qualifying covered employee count calculated using the predecessor's business records obtained by the taxpayer, in accordance with OAR 123-670-0070(3).

(c) Event occurring during the current period. If the event was completed during the current measurement period, the taxpayer must:

(A) Include in the current period monthly qualifying covered employee count all covered employees, including those transferred from the predecessor business, from the date of the transaction through the end of the current period, in accordance with OAR 123-670-0070(3); and

(B) Adjust the baseline period calculation to include the average annual covered employment of the predecessor business or acquired portion of the business for the baseline period, expressed as the average monthly qualifying covered employee count calculated using the predecessor's business records obtained by the taxpayer, in accordance with OAR 123-670-0070(3).

(d) Event occurring during the baseline period. If the qualifying transaction was completed during the baseline period, the taxpayer must include in the baseline period monthly qualifying covered employee count all covered employees, including those transferred from the predecessor taxpayer, from the date of the transaction through the end of the baseline period, using the predecessor's business records obtained by the taxpayer.

(5) Partial Acquisitions. If a taxpayer acquires only a portion of another business’s operations (i.e., a single division, product line, or group of employees) the predecessor/successor framework applies to the acquired portion only. The taxpayer must:

(a) Identify the covered employees transferred as part of the partial acquisition;

(b) Obtain business records from the predecessor business sufficient to calculate the average annual covered employment of the acquired portion for the applicable measurement period; and

(c) Include the acquired portion's covered employment in the baseline period calculation as provided in section (4) of this rule.

(6) Taxpayer Responsibility for Predecessor Records. The taxpayer is responsible for obtaining business records from the predecessor business sufficient to support the adjusted baseline calculation required under this rule. If the taxpayer is unable to obtain the records, the taxpayer must notify OBDD at the time of application and describe the efforts made to obtain such records. OBDD may, in its discretion, accept alternative documentation or estimation methodologies where the taxpayer demonstrates that predecessor records are unavailable through no fault of the taxpayer. OBDD's acceptance of alternative documentation does not waive the taxpayer's attestation obligations or the Oregon Department of Revenue’s authority to audit.

(7) Attestation. A taxpayer subject to this rule must include in its application an attestation, as part of the general attestations required under OAR 123-670-0030(5)(f), that:

(a) The taxpayer experienced an event described in section (2) of this rule during or between the measurement periods;

(b) The adjusted baseline period calculation includes the covered employment of the predecessor business or acquired portion as required by this rule;

(c) The net new jobs reported in the employment and wage worksheet reflect organic job creation and not employment transferred, acquired, or otherwise consolidated through the event; and

(d) The predecessor business records used to calculate the adjusted baseline are accurate and were obtained from reliable sources.

(8) OBDD Review. OBDD may request additional documentation from a taxpayer subject to this rule as part of the application review process, including but not limited to transaction documents, predecessor payroll records, and records demonstrating the scope of the acquired portion of a business in the case of a partial acquisition.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0090 Temporary rule language in effect until 12/01/2026. Business Data Confidentiality and Reporting

(1) Purpose. This rule establishes requirements governing the confidentiality of information submitted by taxpayers in connection with QJCTC applications and certifications under these rules, and OBDD's obligations for annual public reporting on program outcomes. Information submitted to OBDD under these rules is confidential business information and may be used by OBDD only for purposes of administering the QJCTC certification program. Annual reporting by OBDD is limited to aggregate, anonymized program data and does not include taxpayer-specific information.

(2) Confidentiality.

(a) Information received by OBDD from taxpayers pursuant to these rules, including application materials, employment and wage worksheets, supporting documentation, and any other information submitted in connection with a QJCTC application or certification, may be used by OBDD only for the purpose of certification and administration of the QJCTC program.

(b) OBDD shall disclose taxpayer-specific information to DOR as required under ORS 315.058. OBDD may disclose taxpayer-specific information to other entities only if the information is sufficiently aggregated or anonymized to protect the identity and confidential business information of individual taxpayers.

(c) Access to taxpayer-submitted information within OBDD shall be limited to staff whose functions require access for purposes of certification and administration of the QJCTC program, consistent with role-based access controls established by OBDD.

(d) Nothing in this rule prohibits OBDD from disclosing aggregate, anonymized program data for purposes of reporting, transparency, or program evaluation, provided that such disclosure does not identify or allow identification of individual taxpayers or their confidential business information.

(e) Annual Reporting. Consistent with OAR 123-670-0060(8), OBDD shall publish annually on its website aggregate program data including the total amount of credits certified, the number of approved and denied applications, the number of certified taxpayers by qualified industry sector, and whether a proportionate reduction was applied.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0100 Temporary rule language in effect until 12/01/2026. Revocation of Certification

(1) Authority. The Director of the Oregon Business Development Department may order the revocation of a tax credit certification as provided in ORS 315.061.

(2) Grounds for Revocation. OBDD may revoke a certification if the OBDD Director determines that the certification was obtained by fraud or misrepresentation; the approval was obtained by mistake or miscalculation; or the taxpayer otherwise violates or has violated a condition or requirement for eligibility for the tax credit.

(3) Notice of Revocation. OBDD shall provide the taxpayer with written notice of the revocation. The notice shall:

(a) Identify the grounds for the revocation;

(b) Identify the certification or certifications subject to the revocation, including the applicable tax year and certified credit amount.

(4) The taxpayer may request a contested case hearing on the notice of revocation pursuant to ORS chapter 183 and OAR 123-001-0700 and 123-001-0725.

(5) Effect of Revocation.

(a) Upon the order of revocation becoming final, the holder of the revoked certification shall be denied any further relief in connection with the credit from and after the effective date of the revocation, consistent with ORS 315.061.

(b) A taxpayer whose certification is revoked is permanently disqualified from applying for or receiving certification under these rules for any future tax year. Revocation of a certification issued to a corporation in a consolidated group does not affect the certifications issued to other corporations in the same consolidated group, provided those corporations independently met all eligibility requirements and their certifications are not themselves subject to revocation proceedings. Revocation of a certification issued to a partnership or S corporation affects all partners or shareholders who received or claimed the passed-through credit based on that certification. OBDD shall notify DOR of the revocation and the identity of all affected partners or shareholders.

(c) OBDD shall notify DOR promptly following the issuance of a final order revoking the tax credit certification. DOR retains full authority to collect any taxes not paid as a result of the revoked credit, as provided in ORS 315.061.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-670-0110 Temporary rule language in effect until 12/01/2026. Recordkeeping

(1) Purpose. This rule establishes recordkeeping requirements for taxpayers that apply for or receive certification under these rules.

(2) General Retention Requirement. As provided in OAR 123-670-0030(8), a taxpayer must retain all records supporting its application for a minimum of five years from the date of certification. Records subject to this requirement include:

(a) Business records used to calculate average annual covered employment for each measurement period, as described in OAR 123-670-0070(9);

(b) Records supporting the wage threshold determination for each position counted as a net new job, including records of each employee's hourly rate of compensation, county of primary work location, and monthly covered employee counts for the measurement period;

(c) Records supporting the taxpayer's industry eligibility determination under OAR 123-670-0020(1)(a), including the NAICS code used on federal tax filings or Oregon registrations, or documentation supporting a written statement submission under OAR 123-670-0020(1)(a)(B); and

(d) A copy of the application, all attestations, the employment and wage worksheet, and any correspondence with OBDD regarding the application or certification.

(3) Records Supporting M&A Adjustments. A taxpayer subject to OAR 123-670-0080 must retain, for the same five-year period, all predecessor business records obtained and used to calculate the adjusted baseline period average annual covered employment, including records identifying the scope of the transaction and the covered employees transferred.

(4) Format. Records may be retained in paper or electronic format, provided they are accessible and legible and can be produced in a timely manner upon request.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: Oregon Laws 2026, Chapter 142 & Oregon Laws 2026, Chapter 50
OBDD 9-2026, temporary adopt filed 06/02/2026, effective 06/05/2026 through 12/01/2026

Division 674 STANDARD EXEMPTION ON TAXABLE ENTERPRISE ZONE PROPERTY

Or. Admin. R. 123-674-0001 Temporary rule language in effect until 12/01/2026. Purpose, Scope and General Process for Businesses Seeking Exemption

(1) This division of administrative rules clarifies, specifies and establishes elements of ORS 285C.050 to 285C.250 ( Oregon Enterprise Zone Act ) for the determinations, procedures and requirements relevant to the three- to ten-year exemption from property taxes under ORS 285C.175 on qualified property of eligible business firms in any enterprise zone.

(2) The outline of these rules, regarding a business firm’s receipt of this exemption, is that:

(a) The sponsor of the enterprise zone may extend the usually three-year period to four or five years (under ORS 285C.160(2)(b)(A) or up to ten consecutive years in total (under ORS 285C.160(2)(b)(B) by executing a written agreement with the firm before approval of the application in subsection (c) of this section.

(b) The firm must be engaged in eligible activities as primarily determined with authorization.

(c) The firm must apply for authorization, generally before any work begins on the new investment, and the local zone manager and the county assessor need to authorize the firm.

(d) The firm must satisfy applicable employment qualifications and performance criteria during the entire exemption period to qualify for the exemption and maintain the exemption.

(e) The exemption is primarily on certain new property and only for an authorized firm that timely claims the exemption with the assessor after it has placed the property in service; before that, it may be exempt under ORS 285C.170.

(3) These administrative rules do not control or bind the county assessor or Department of Revenue and are superseded by OAR chapter 150 in matters related to tax administration including but not limited to rules for purposes of the statutory sections listed in ORS 285C.125(1).

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.045 & ORS 285C.050 – 285C.250
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-0100 Temporary rule language in effect until 12/01/2026. Definitions

OAR 123-001 (Procedural Rules) contains definitions that are used in this division of administrative rules along with terms under ORS 285C.050. Additionally, for purposes of these rules, the following terms have the meanings set forth below unless the context demands otherwise:

(1) Annual Employment means the number of employees as averaged over the course of a year of exemption under ORS 285C.175 based on OAR 123-674-4000.

(2) Application means the latest revision of Department of Revenue Form OR-EZ-AUTH, 150-303-029, Oregon Enterprise Zone Authorization Application (inclusive of attachments) as filled out and submitted by a business firm to the zone sponsor, and available at oregon.gov/dor/forms/Pages/default.aspx.

(3) Approval Form means the latest revision of form 150-303-082, Oregon Enterprise Zone Authorization Approval, available from the Department of Revenue at oregon.gov/dor/forms/Pages/default.aspx for documenting local authorization of the Firm/applicant.

(4) Claim Employment means the total number of employees on the date when an authorized business firm files its exemption claim under ORS 285C.220 or on the corresponding April 1, whichever is earlier.

(5) Current County Wage is the finalized average annual figure under ORS 285C.050(4) for all industries and ownerships in the county as most recently released for the Quarterly Census of Employment and Wages (QCEW), according to the transition from one year’s figure to the next as determined by the Department.

(6) Established County Wage is the Current County Wage:

(a) Of the county with the higher or highest wage in the case of an enterprise zone that contains any area in two or more counties, regardless of sponsorship by the county government.

(b) At the time when one of the following effectively occurs, whichever is later:

(A) Application is approved (Firm/applicant is authorized) under ORS 285C.140(6) by completion of the Approval Form according to OAR 123-674-2500;

(B) When, consistent with OAR 123-674-3700:

(i) A statement of authorization renewal is submitted under ORS 285C.165(1); or

(ii) The exemption claim is initially filed under ORS 285C.220 and 285C.225 using an authorization that is inactive.

(7) “Estimate” and “estimated,” as used in ORS 285C.140, mean current expectations of the owners, managers and executives of an eligible business firm based on the best information available at the time, which shall not be construed as binding.

(8) Existing Employment means the number of employees averaged over the entire 12-month period preceding the date on which the Application is submitted under ORS 285C.140 based on OAR 123-674-4000.

(9) Jobs Retained or Job Retention means the number of eligible employees as averaged over the course of a year of exemption under ORS 285C.175 that were maintained in relation to the Existing Employment by the business firm as a direct result of the investment or project.

(10) Wage Growth means the increase in hourly wage rates, averaged over the course of year of exemption, paid by a business firm to all eligible employees at a facility or operations subject to exemption under ORS 285C.175.

(11) Revenue Growth means increase in a company’s total income from its eligible business activities under ORS 285C.135 for the tax year the business firm is receiving exemption under ORS 285C.175.

(12) Firm/applicant means a business firm that is seeking to have an Application approved in order to be authorized in an enterprise zone, or that has received approval but not yet begun an exemption under ORS 285C.175.

(13) Preauthorization Conference means the meeting between a Firm/applicant and enterprise zone sponsor/local zone manager, to which the county assessor must be effectively invited, that is to take place after submission of the Application and before completion of the Approval Form under ORS 285C.140(4) to (6), as well as the associated written summary. (The Department may set forth further guidelines or instructions for the Preauthorization Conference, to be made available at www.oregon.gov/biz.)

(14) Year (including ‘exemption year’) means a calendar year or assessment year from January 1 to December 31 (and not a property tax or government fiscal year unless so specified) consistent with the definitions under ORS 285C.050(1) and (23).

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.050 – 285C.250 & ORS 285C.255
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-0200 Temporary rule language in effect until 12/01/2026. General Employment Terminology and Issues

As used in this division of administrative rules, especially OAR 123-674-0100 and 123-674-4000 to 123-674-4800, in determining business firm job levels:

(1) Averaging based on hours worked, hour paid or the like, such as full-time equivalency, is not permitted: rather, persons in full-time, year-round jobs associated with relevant business operations throughout the enterprise zone, either at a particular time or on average over a year or 12-month period, are counted.

(2) This relates primarily to “employees of the firm” or “employment of the firm,” as used in ORS 285C.200 and 285C.210, which:

(a) Includes positions or persons who are:

(A) Employed directly by the business firm, including but not limited to being hired or retained through lease or contract with the person or with a third party serving such a leasing or payroll function for the firm, provided that the firm nevertheless selected and directly manages their work, but excluding any employee of an independent contractor, or anyone whom the firm leases or contracts out to another business;

(B) Engaged a majority of their working time in eligible operations under ORS 285C.135, including but not limited to persons who perform eligible activities as described in OAR 123-674-1100 or 123-674-1200(3) or (4); and

(C) Assigned to an official work site inside the enterprise zone and are performing work for operations located there in terms of how they spend at least 75 percent of their time on the job, even if not physically working inside the zone during that entire time, but rather in the immediately surrounding region, such that the employee can reasonably commute to such locations on a regular basis.

(b) Excludes positions or persons who are employed or performing work:

(A) In temporary or seasonal jobs;

(B) For 32 or fewer hours per week;

(D) Regularly for operations located outside the zone boundary;

(E) With ineligible operations at least half of their time; or

(F) At any other business firm, including but not limited to affiliates or commonly owned companies.

(3) Consistent with subsection (2) of this rule, only full-time jobs with the firm that are filled indefinitely and serve the firm’s eligible operations inside the zone year-round are normally relevant. The following are exceptions:

(a) Only employees who work for the particular headquarter-type facility are relevant in the case of OAR 123-674-1700, irrespective of other eligible employees described in paragraph (2)(a)(C) of this rule, and such employees may perform professional services or other normally ineligible activities regardless of paragraphs (2)(a)(B) and (b)(E);

(b) For the transfer of eligible operations within 30 miles of zone boundary, further requirements described in OAR 123-674-4100(3) and 123-674-4600(2) also cover employees at affected sites outside the zone, irrespective of paragraphs (2)(a)(C) and (b)(D) of this rule, but only at the start and during the first year of any exemption period.

(c) The prohibition consistent with OAR 123-674-4200 on jobs losses in Oregon more than 30 miles outside the zone also encompasses persons employed by any commonly controlled company irrespective of paragraph (2)(a)(A) and (b)(F) of this rule.

(d) Jointly owned firms may combine their employment throughout the zone subject to section (4) of this rule, irrespective of paragraph (2)(a)(A) and (b)(F) of this rule.

(e) Temporary workers filling permanent positions are acceptable in a one-off situation, irrespective of paragraph (2)(b)(A) of this rule, if the county assessor and the local zone manager conclude that:

(A) The qualified business firm is making every reasonable effort to fill such positions with permanent, regular hires; and

(B) The temporary workers and other potentially available job applicants do not meet reasonable, minimum standards of the firm for permanent hire, such as a high school diploma or equivalency.

(4) Under ORS 285C.135(5), two or more eligible business firms with 100-percent common ownership may elect to be treated as a single firm for combining zone employment if authorized representative(s) of the firms or a parent company formally notify the local zone manager and county assessor to that effect before or with the initial exemption claim under ORS 285C.220. Such an election affects all applicable provisions under ORS 285C.050 to 285C.250 and this division of administrative rules, including but not limited to rendering moot any inter-firm lease of qualified property (which would then all be simply owned by the Firm/applicant), but it does not carry over to any subsequent authorization except in a terminated zone.

(5) Only newly created jobs may satisfy required increases in employment levels, as opposed to any employee associated with the merger or acquisition of another business firm or of its existing operations or property, except positions inside the zone that were vacant for 60 or more days at the time of Application, and for whom rehiring or reemployment was otherwise unlikely (for example, a plant had shut down and then a buyer or investor came along and restarts operations).

(6) As used in this rule and under ORS 285C.050:

(a) “Person” may mean two or more part-time employees who together perform a single job involving more than 32 hours of work per week by virtue of an established (job-sharing) arrangement.

(b) “32 hours per week” is computed by taking the total number of hours over the course of a year, for which the person is remunerated in the form of wage or salary inclusive of holidays, vacation and other paid leave, and dividing by 52 (hours paid).

(c) “Temporary or seasonal jobs” are nonpermanent positions, including but not limited to persons recruited and receiving compensation through the firm or an outside agency on a short-term, ad hoc or as-needed basis, or where the firm hires, leases or contractually employs a person for a period expected to be less than 12 consecutive months, even if on a trial or probationary basis that typically leads to the person’s being offered a permanent job.

(7) There is no necessary relationship between minimum employment requirements and the requisite First Source Hiring Agreement, as addressed in OAR 123-070 and 123-674-7700 to 123-674-7730.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, ORS 285C.135, ORS 285C.200 & ORS 285C.210
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 32-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-0300 Temporary rule language in effect until 12/01/2026. Satisfaction of ORS 285C.200 Requirements

(1) An authorized business firm must meet the eligibility qualifications provided for in ORS 285C.200 for qualified property of the firm to be exempt from property taxation under ORS 285C.175.

(2) Notwithstanding (1) above, the authorized business firm may maintain eligibility by satisfying the employment requirements provided for in ORS 285C.200(1)(c) by alternatives provided for in:

(a) ORS 285C.200(2) (requires agreement with zone sponsor);

(b) ORS 285C.200(2) (requires agreement with zone sponsor); or

(3) Notwithstanding (1) above, the authorized business firm may maintain eligibility by satisfying the employment requirements provided for in ORS 285C.200(1)9d) by the alternatives provided for i:

(a) ORS 285C.200(2) (requires agreement with zone sponsor); or

(b) ORS 285C.200(2) (requires agreement with zone sponsor).

(4) Notwithstanding (1) above, the authorized business firm may maintain eligibility by satisfying the qualification provided for in ORS 285C.200(1)(e) by the alternative provided for in ORS 285C.200(3).

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.175 & ORS 285C.200
OBDD 10-2026, temporary adopt filed 06/05/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-674-0350 Temporary rule language in effect until 12/01/2026. Alternative Performance Criteria for Authorized Business Firms

(1) As provided by ORS 285C.200(2)(b), a sponsor and business firm may agree to waive the employment qualifications of ORS 285C.200(c), and instead impose alternative performance criteria to maintain the exemption from property taxation under ORS 285C.175. Such authority is subject to the following requirements:

(a) A clear statement of the waiver of the requirements of ORS 285C.200(1)(c) along with description of the approved alternative performance criteria in a written agreement between the business firm and the sponsor.

(b) The alternative performance criteria that may be approved are limited to Job Retention, Wage Growth, or an alternative criterion adopted by rule by the Department.

(c) The written agreement to utilize alternative performance criteria must be executed on or before the date on which the firm is authorized under ORS 285C.140.

(2) The minimum threshold that a zone sponsor may approve for a business firm to utilize Job Retention (as defined in OAR 123-674-0100) as an alternative performance criterion under (1)(b) of this rule is that the business firm will retain at least 90% of the jobs for the duration of the business firm exemption period, as compared to the Existing Employment (as defined in OAR 123-674-0100); or

(3) The minimum threshold that a zone sponsor may approve for a business firm to utilize Wage Growth (as defined in OAR 123-674-0100) as an alternative performance criterion is that the business firm will increase the average hourly wage rate of Annual Employment by 10% as measured against the previous exemption year’s Annual Employment wages or to Existing Employment wages if calculating the first year of exemption.

(4) For avoidance of doubt, a zone sponsor may adopt a resolution setting an alternative minimum threshold for Job Retention and/or Wage Growth that a business must meet to qualify that is higher than those provided in (2) and (3) of this rule.

(5) This rule does not apply with respect to qualified property of an authorized business firm used in operating a data center, as defined in OAR 123-650-0100.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.200
Statutes/Other Implemented: ORS 285C.200, ORS 285C.203 & ORS 285C.205
OBDD 10-2026, temporary adopt filed 06/05/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-674-0400 Temporary rule language in effect until 12/01/2026. Flexible Hiring Timelines

(1) As provided by ORS 285C.200(2)(a), a sponsor and business firm may agree to use a flexible hiring timeline to meet the employment qualifications of ORS 285C.200(c)(A)-(B) rather than the timeline provided in ORS 285C.200(1)(c) (which is on or before the earlier of April 1 or the date on which the initial exemption claim is filed under ORS 285C.220, following the year in which the qualified property is first placed in service in the enterprise zone). Such authority is subject to the following requirements:

(a) The new hiring timeline to meet the employment qualifications of 285C.200(1)(c)(A)-(B) must be detailed in a written agreement between the business firm and the sponsor (e.g. phased/ delayed, etc. with dates).

(b) The written agreement to revise the hiring timeline for the employment qualifications must be executed on or before the date on which the firm is authorized under ORS 285C.140;

(c) The business firm must provide the zone sponsor with a plan that details the action steps to be taken to meet the proposed new timeline for the employment qualifications.

(d) The zone sponsor must review the plan described in (1)(c) and find that the plan submitted by the business firm is satisfactorily supported to demonstrate a clear plan to achieve the proposed new timeline.

(e) The written agreement shall include required employment or alternative performance criteria, including but not limited to job retention, improvements in productivity and revenue growth, over the course of the exemption period that the business firm is not required to meet the 285C.200(1)(c)(A)-(B) employment qualifications. The written agreement shall include the date during the exemption period on which the business firm is required to meet the qualifications of ORS 285C.200(1)(c) (i.e. date when the flexible hiring timeline ends).

(f) Failure to meet the terms of the written agreement is a disqualifying event for the business firm under ORS 285C.240.

(2) As provided by ORS 285C.200(a), a sponsor and business firm may agree to use a flexible hiring timeline to meet the employment qualifications of 285C.200(1)(d) as provided by ORS 285C.200(5) and (6) rather than the timelines provided in 285C.200(5)(after authorization and on or before December 31 of the first tax year for which any qualified property of the firm in that zone would otherwise be exempt under ORS 285C.175) and (6) (no later than April 1 preceding the first tax year for which qualified property of the firm is exempt under ORS 285C.175). Such authority is subject to the following requirements:

(a) The new hiring timeline to meet the employment qualifications of ORS 285C.200(5) and (6) must be detailed in a written agreement between the business firm and the sponsor.

(b) The written agreement to revise the hiring timeline for the employment qualifications must be executed on or before the date on which the firm is authorized under ORS 285C.140.

(c) The business firm must provide the zone sponsor with a plan that details the action steps to be taken to meet the proposed new timeline for the employment qualifications.

(d) The zone sponsor must review the plan described in (2)(c) and find that the plan submitted by the business firm is satisfactorily supported to demonstrate a clear plan to achieve the proposed new timeline.

(e) The written agreement shall include required employment or alternative performance criteria, including but not limited to job retention, improvements in productivity and revenue growth, over the course of the exemption period that the business firm is not required to meet the 285C.200(1)(d) employment qualifications. The written agreement shall include the date during the exemption period on which the business firm is required to meet the qualifications of ORS 285C.200(1)(d) (i.e. date when the flexible hiring timeline ends).

(f) Failure to meet the terms of the written agreement is a disqualifying event for the business firm under ORS 285C.240.

(3) This rule does not apply with respect to qualified property of an authorized business firm used in operating a data center, as defined in OAR 123-650-0100.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.200
Statutes/Other Implemented: ORS 285C.200
OBDD 10-2026, temporary adopt filed 06/05/2026, effective 06/05/2026 through 12/01/2026

Or. Admin. R. 123-674-0500 Temporary rule language in effect until 12/01/2026. EXTENDED TAX ABATEMENT — General Points

With respect to an extended period of property tax abatement longer than three years under ORS 285C.160 and 285C.175(2)(b):

(1) The period in which a qualified business firm needs to comply with all regular enterprise zone requirements is also extended for up to two more years, exposing the firm to having to pay back all four or five years of abated taxes because of noncompliance and regular disqualification, for example, in the event of substantial curtailment in either of those two years.

(2) The exemption shall revert to the basic three-year period upon failure to satisfy an applicable requirement only in OAR 123-674-0600 or 123-674-0700, triggering repayment of taxes abated (only) in the fourth, fifth, sixth, seventh, eighth, nineth, or tenth year as applicable.

(3) Even as other property continues to receive the extended abatement, a qualified business firm may elect to have certain property terminate its exemption after the third year, such that it is then subject to taxation but not to retroactive disqualification under ORS 285C.240(1)(a), (e) or (f). What property is exempt for only three years or may receive additional years of exemption shall be described in:

(a) The written agreement in OAR 123-674-0700; or

(b) Specific notice provided to the county assessor from the firm or property owner no later than April 1 directly following the third exemption year.

(4) An eligible business firm has the same rights of appeal as provided elsewhere in ORS 285C.050 to 285C.250 for the enterprise zone exemption, and no part of this division of administrative rules shall interfere with those rights, subject to the determination of appellate authorities.

(5)(a) Requirements in OAR 123-674-0600 are inapplicable and are not to be included in the written agreement described in OAR 123-674-0700 of any qualified business firm, for which based on the time when the Application was submitted, its qualified property is located inside:

(A) An urban enterprise zone; and

(B) A metropolitan statistical area with a total population of 400,000 or greater inside Oregon, based on the most recent estimate available from the Portland State University Population Research Center.

(b) As such, at the time of this rulemaking, this section pertains only to zones inside the urban growth boundaries of the Portland–Metro region and of Salem–Keizer.

(6) For the purposes of an extended abatement period under 285C.160(2)(b)(B), as that is authorized by adoption of a resolution by the zone sponsors governing body as described in OAR 123-650-4800, and is included in a written agreement between the sponsor and the business firm, the business firm must demonstrate substantial capital investment, regional economic impact or alignment with local economic development goals.

(a) Examples of a project demonstrating substantial capital investment may include but is not limited to a capital investment over $25 million, investments in the local infrastructure, or capital investments in the community.

(b) Examples of a project demonstrating regional economic impact may include but is not limited to attracting new industries to the region or locating in an area targeted for revitalization or redevelopment.

(c) Examples of a project demonstrating alignment with local economic development goals may include but is not limited to creating significant jobs for the area, providing upskilling and job training opportunities to employees, or creating high-wage jobs.

(d) The demonstrated substantial capital investment, regional economic impact or alignment with local economic development goals must be included in a written agreement as described in OAR 123-674-0700.

(e) Zone sponsors may adopt minimum thresholds or specific criteria related to substantial capital investment, regional economic impact or local economic development goals in accordance with OAR 123-650-4800.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, ORS 285C.160, ORS 285C.165 & ORS 285C.175(2)(a)(B)
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-0600 Compensation & Wage Standards

For purposes of ORS 285C.160 and a qualified business firm subject to a written agreement described in OAR 123-674-0700:

(1) In order for the firm to receive the additional one or two years of exemption on qualified property inside any enterprise zone not excluded by OAR 123-674-0500(5):

(a) Wages received on average must equal or exceed the Current County Wage, but only:

(A) During the additional one or two years; and

(B) If the agreement was executed on or after October 6, 2017; and

(b) During each year throughout the exemption’s first three years and the additional one or two years, average compensation must equal or exceed:

(A) 150 percent of the Established County Wage; or

(B) 130 percent of the Established County Wage, if:

(i) The agreement is executed on or after October 6, 2017; and

(ii) When it is executed, any part of the zone is inside a qualified rural county under ORS 285C.050(17).

(2) The compensation requirement in subsection (1)(b) of this rule applies only to ‘new employees hired by the firm’ as defined under ORS 285C.050(13). That definition is also used here for the requirement of wages received in subsection (1)(a) of this rule, for the sake of convenience, such that both requirements are satisfied by averaging only across “affected employees,” which encompass jobs, positions or persons:

(a) Included as part of ‘employment of the firm’ according to OAR 123-065-0200;

(b) Created, filled and hired for the first time:

(A) After the date of Application under ORS 285C.140(1), even if an individual filling the job is already employed by the eligible business firm in another position that is refilled within the zone; and

(B) On or before December 31 at the end of the initial, first exemption year; and

(c) For which calculation of their average annual compensation or wages received may include the regular yearly compensation or wages (excluding bonuses or the like) of an applicable position that is temporarily vacant due to unforeseen circumstances for not more than 90 days at any time during the year.

(3) As used in this rule:

(a) “Compensation” includes total calendar-year remuneration (whether taxable or not) for all affected employees in the form of wages, salary, overtime pay, shift differential, profit-sharing, bonuses, commissions, paid vacation, and associated fringe or financial benefits such as life insurance, medical coverage and retirement plans, but excluding:

(A) Free meals, club membership or comparable workplace amenities;

(B) Payroll-based tax or cost mandated by federal, state or local law, such as worker’s compensation, unemployment insurance or the employer’s share under FICA; and

(b) “Wages received” are total taxable income paid to all affected employees and used in calculating amounts withheld or otherwise applicable under ORS chapter 316 for purposes of Oregon personal income taxes of any such person during the calendar year.

(4) As used in ORS 285C.050(17) and in identifying qualified rural counties:

(a) “County … outside all metropolitan statistical areas” means an Oregon county other than Benton, Clackamas, Columbia, Deschutes, Jackson, Josephine, Lane, Linn, Marion, Multnomah, Polk, Washington or Yamhill County, or any combination of those counties.

(b) “[T]otal property taxes imposed by all taxing districts within the county are equal to or greater than 1.3 percent of the total assessed value of all taxable property located in the county” is true if the quotient of the respective amounts from the Department of Revenue’s most recently published Oregon Property Tax Statistics (150-303-405) is equal to or greater than 0.013 rounded to the nearest one-thousandth. Those amounts shall be updated as feasible and necessary using more current tax year documentation of the county (excluding urban renewal from the tax figure).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.160, 285C.165 & 285C.240
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-0700 Temporary rule language in effect until 12/01/2026. Written Agreement between Sponsor and Eligible Business Firm

For purposes of the written agreement that is required between the sponsor of an enterprise zone and an eligible business firm under ORS 285C.160:

(1) To receive an additional one to seven years of exemption, the agreement must be finalized no later than completion of the Approval Form.

(2) Both the Firm/applicant seeking an extended abatement and the sponsor of the zone (see OAR 123-668-2450) must formally endorse the agreement.

(3) The agreement shall specify whether:

(a) The total period of abatement is four, five, six, seven, eight, nine, or ten consecutive years; and

(b) The Firm/applicant needs to fulfill any additional requirement with respect to determining satisfaction and consequence of its not being met, in accordance with OAR 123-668-2000 to 123-668-2500.

(4) Adherence to or satisfaction of such additional requirements shall in no way condition the first three years of an eligible business firm’s enterprise zone exemption under ORS 285C.175(2)(a).

(5) For written agreements of an abatement period of six to ten years, the agreement must explain how the project meets the requirements for substantial capital investment, regional economic impact, or alignment with local economic development goals.

(6) For any agreement entered into on or after September 24, 2023, it:

(a) Shall take effect only in accordance with OAR 123-668-3000.

(b) Is not valid unless stipulating a rate for the school support fee under ORS 285C.160(2) in accordance with OAR 123-668-4000 and 123-668-4100.

(7) Notwithstanding section (1) of this rule, if the zone sponsor rejected a Firm/applicant’s request for an extended tax abatement, and the Application was subsequently approved, but commencement of construction, modification or installation of qualified property has not yet occurred, then the sponsor may reverse its decision and enter into a written agreement based on a resubmitted Application.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, ORS 285C.160, ORS 285C.162, ORS 285C.163, ORS 285C.175 & ORS 285C.060
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 22-2023, minor correction filed 08/24/2023, effective 08/24/2023
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1000 BUSINESS ELIGIBILITY — Special Business Distinctions

For these administrative rules:

(1) As used in ORS 285C.050 to 285C.250, “hotel, motel or destination resort” means any ‘destination resort’ or ‘hotel or motel’ facility as defined in OAR 150-285-3200.

(2) “Fulfillment center” as used in ORS 285C.135(2)(c) means a facility, for which 25 percent or more of its newly re/constructed space or annual labor expense is used to process, handle or transport goods that:

(a) Are not also produced, fabricated or similarly subject to value-added treatment at that facility;

(b) Fulfill a retail purchase or transaction, for example, through a call center or electronic commerce; and

(c) Are delivered to customers, consumers or end-users (regardless that they are businesses rather than households) located inside this state within:

(A) 50 miles of travel distance from the facility; or

(B) 30 miles of straight-line distance from any place on the enterprise zone boundary.

(3) As used in ORS 285C.050(3):

(a) “Municipal corporation” has the same meaning as found under ORS 294.311, including but not limited to any special or local service district, but excluding a people’s utility district or a joint operating agency under ORS 262.005.

(b) “Operating or conducting one or more trades or businesses” means to manage or undertake commercial affairs, as evidenced by the following:

(A) Establishment of a place of business and acquisition of property that is necessary to perform business operations through ownership, renting or leasing;

(B) Approval to do business from the appropriate regulatory authorities, as documented by required licenses or permits;

(C) Capital investment or financing, including self-financing, and procurement of supplies or services from other businesses or operations within the firm;

(D) Maintenance of business records such as those related to sales, shipments, personnel or payroll; and

(E) Ultimate pursuit is producing or furthering the production of income.

(4) “Professional services” as used in ORS 285C.135(2)(b) means the intellectual output of recognized professions (based on advanced training, certifications or the like) that takes the form of unique advice, reports, designs, schematics, plans and so forth for external clients or customers, in contrast to internal inputs that directly support eligible operations within the enterprise zone.

(5) “Separate” as used in ORS 285C.135(3) means a definitive and physical demarcation, including but not limited to a wall between eligible and ineligible activities sufficient to distinguish the employees and qualified property pertaining to either one.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.070 & 285C.135
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1100 Temporary rule language in effect until 12/01/2026. Basic Eligibility of Firms and Operations

For purposes of establishing a business firm’s eligibility under ORS 285C.135(1) in an enterprise zone:

(1) The Firm/applicant (when qualified) must:

(a) Be a business firm under ORS 285C.050 consistent with OAR 123-674-1000(3); and

(b) Be engaged in or proposing to engage in business, within the enterprise zone, of providing goods, products or services to other businesses or other organizations, through eligible activities; or

(c) Be engaged in or proposing to engage in an industry sector identified by resolution of the governing body of the zone sponsor as a priority industry under a local or regional economic development strategy; or

(d) Be engaged in an activity described in ORS 285C.135(2) and have received an approved waiver from the Department pursuant to ORS 285C.135(3)(b) to conduct that business activity; or

(e) Be engaged in an activity described in ORS 285C.135(2) and such activity is an allowed activity within a pilot program authorized by the Department pursuant to ORS 285C.135(3)(b).

(2) A business firm’s relevant operations will indicate such eligibility if they are:

(a) Performed for internal purposes of the firm;

(b) Reimbursed through sales to another business firm;

(c) Equivalent to what is done for other business firms, even if the actual customer is a government agency, a public corporation or nonprofit organization; or

(d) Undertaken to create or add value to goods, products or services for ultimate exchange with persons or entities residing beyond the local economy.

(3) As used in this rule, “eligible activities” under (1)(b) include but are not limited to:

(a) Manufacturing, assembly, fabrication, processing, shipping or storage, in an industrial sense;

(b) Processes or services such as cleaning, coating, curing, kiting, labeling, laminating, packaging, refining, smelting, sorting or treating for production of goods, inputs and so forth;

(d) Recycling of post-consumer or post-production materials or wastes;

(e) Nonretail, in-shop refurbishment or restoration of equipment or machinery;

(f) Maintenance service or repair work on vehicles, products, parts or devices, performed on a nonretail ( e.g. , contract) basis at a permanent location, facility or shop, including but not limited to warranty service contracted or paid for by the manufacturer;

(g) Technical/customer support performed for internal purposes of the firm, or contracted or paid for by a nonretail third party such as a product’s distributor or manufacturer;

(h) Standardized product testing, quality control or laboratory work, including but not limited to services provided to healthcare businesses or organizations that themselves treat patients;

(i)Bulk clerical processing or data center operation for internal or external business services;

(j) Development of standardized computer software products or customized products for business users;

(k) Printing or mass document production;

(l) General production of molds, forms, models, prototypes or similar items for other businesses that does not, in and of itself, merely fulfill an architectural, design or similarly advanced professional service;

(m) Distribution, including shipping, storage and warehouse functions that entail deliveries generally beyond the local area or enterprise zone region, to recipients who are variously businesses, organizations, or households for which the delivery is not a direct consequence of a retail purchase—i.e., not a fulfillment center;

(n) Wholesaling, which may include complex transactions for single-item purchases by other businesses of large equipment involving contracts, factory-ordered specifications or other attributes distinguishing the sale from normal retail;

(o) Production of agricultural, mineral, timber or other primary goods or commodities; or

(p) Similar types of business operations.

(4) As used in this rule, priority industry sector means a segment of the economy comprising various related industries, business firms, and business activities that share similar characteristics recognized for its substantial contributions to employment, investment, or overall economic output, as well as its potential for future growth or strategic importance.

(5) A business firm that is part of a priority industry sector, nonetheless, does not qualify as an eligible business firm under ORS 285C.135(1)(b) if the business firm is engaged in a business activity described in ORS 285C.135(2). To qualify under ORS 285C.135(1)(b), the business firm must be engaged in a business activity that (a) is not otherwise eligible under 285C.135(1)(a); (b) is not a business activity described in ORS 285C.135(2); and (c) is within a priority industry sector identified by resolution of the governing body of the zone sponsor under a local or regional economic development strategy.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.135
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1200 Temporary rule language in effect until 12/01/2026. Ineligible Activities

For purposes of ORS 285C.135:

(1) Unless approved through a waiver or an authorized a pilot program pursuant to ORS 285C.135(3)(b), a business firm engaged in any of the following business activities is not an eligible business firm, and property used in any such activity may not qualify for an enterprise zone exemption under ORS 285C.175, regardless that it serves other businesses:

(a) Retail sales of goods or services;

(b) Retail food service or serving of meals;

(d) Entertainment or recreation provided directly to the patron or user;

(e) Childcare or similar services;

(f) Provision of health care, medical services or similar services to patients;

(g) Professional services, such as accounting, communications, design, engineering, legal advice or management;

(h) Actuary, appraisal, banking, brokerage, extension of credit, insurance, investment, money lending or similar financial services;

(i) Leasing or management of real estate;

(j) Provision of residential housing for purchase or lease;

(k) Construction or modification of real property;

(l) Installation of fixtures, machinery or equipment;

(m) Leasing or contracting out employees to work even in eligible activities for another business;

(n) Recreational vehicle parks

(o) Renting of storage units or space;

(p) Fulfillment center; or

(q) Similar types of business operations.

(2) A business firm is eligible, regardless of the presence within the enterprise zone of one or more activities listed in section (1) of this rule, if they are:

(a) Separate consistent with OAR 123-674-1000(5) and OAR 123-674-1300; or

(b) Insignificant in accordance with OAR 123-674-1400.

(3) Activities described in or comparable to subsections (1)(b) through (j) of this rule, as well as associated employees and property, are eligible if performed by the business firm:

(a) Within the same enterprise zone; and

(b) To directly support, benefit or provide amenities to eligible operations or associated personnel located mostly inside the zone. If, however, more than 25 percent of the activity supports or benefits the firm’s operations outside the zone in terms of person-time or costs, then the requirements of OAR 123-674-1700 for headquarters-type facilities must be fulfilled.

(4) Notwithstanding OAR 123-674-1100, an activity is eligible in the following cases:

(a) Subsection (1) to (h) and (p) of this rule or similar activities with electronic commerce operations located in an area designated as such, in accordance with OAR 123-662.

(b) Subsection (1)(a) to (f), (n) or (o) of this rule or similar activities with a hotel, motel or destination resort if:

(A) Such businesses are eligible in that (part of the) enterprise zone as established with the Department’s determination in OAR 123-650-4900 (or previously in a Director’s Order) consistent with the zone sponsor’s election or restriction(s) as described in OAR 123-650-4800(2)(e);

(B) The activity is at the same location and owned and operated in common with the hotel, motel or destination resort; and

(c) Subsection (1)(a), (d) and (f) to (h) of this rule or similar activities with operations described in OAR 123-674-1600 (Call Centers).

(d) Subsection (1)(g) to (i) of this rule or similar activities with a facility described in OAR 123-674-1700 (Headquarter Facilities).

(e) Any activity that has been approved through waiver or authorized pilot program pursuant to ORS 285C.135(3)(b).

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.135 & ORS 285C.185
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 33-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1300 Temporary rule language in effect until 12/01/2026. Eligible Business Firm with Ineligible Activities

For purposes of ORS 285C.135(3)(a):

(1) A Firm/applicant is eligible:

(a) If when qualified, it engages in an eligible activity in the enterprise zone;

(b) Provided that any ineligible activity of the Firm/applicant is at a separate business operation; and

(2) Any requirement to hire, maintain or compensate employees under ORS 285C.050 to 285C.250 applies only to “eligible employees,” as used in ORS 285C.140(1)(a), consistent with OAR 123-674-0200.

(3) Firm/applicant and the local zone manager shall see that the Preauthorization Conference addresses distinctions relevant to this rule, and the local zone manager shall assist the firm and the county assessor in determining such portions of the firm’s property that will qualify.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.135, ORS 285C.200 & ORS 285C.210
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1400 Gross Receipts Test

(1) A gross receipts test shall determine the eligibility of a business firm or business operation that partially involves an ineligible activity only when:

(a) There are Applicable Gross Receipts;

(b) The firm is not eligible as described in OAR 123-674-1200(4); and

(c) For lack of definitive or physical separation, the ineligible activity cannot be effectively isolated from eligible activities for purposes of OAR 123-674-1300.

(2) The Firm/applicant or operation passes the gross receipts test and is otherwise eligible for authorization and qualification in the enterprise zone, if Applicable Gross Receipts divided by Ineligible Receipts equals or exceeds 4.0.

(3) For purposes of this rule, the local zone manager shall see as part of the Preauthorization Conference that the authorization includes:

(a) An explanation of the eligibility of the firm or operation consistent with this rule; and

(b) Arrangements to substantiate this for the firm’s future qualification, as appropriate.

(4) “Applicable Gross Receipts” as used in this rule are based on:

(a) Sales revenue derived directly from a party external to the firm in exchange for goods, products, commodities, merchandise, work or services;

(b) Operations located entirely inside the enterprise zone;

(d) An annual total for the most recent fiscal year or calendar year; and

(e) The commercial state of affairs, as realized when the firm is qualified for the property tax exemption being sought, which is estimated for purposes of the Application or Preauthorization Conference.

(5) “Ineligible Receipts” as used in this rule are that subset of the same Applicable Gross Receipts that arise from an ineligible activity described in OAR 123-674-1200(1), including but not limited to receipts that entail:

(a) Consumption by an end-user among the public;

(b) Sales directly to a household or individual that is neither another business firm nor operating as such; or

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.135 & 285C.140
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1600 Temporary rule language in effect until 12/01/2026. Call Centers and Like Operations

For purposes of ORS 285C.135(4)(a):

(1) A Firm/applicant and its operations are eligible, regardless of retail transactions, financial services or other ineligible activities, if:

(a) They serve the firm or its clients exclusively through computer, electronic, online, telephone or other information and communication technologies or methods;

(b) No more than 10 percent of the customers or business transactions come from inside the local calling area, in which telephone calls could be made to and from the firm’s location in the enterprise zone without long distance telephone charges or service as traditionally applied to landlines; and

(c) Not engaged in telemarketing, but rather the firm is taking unsolicited orders or responding to prior instruction, including but not limited to:

(A) Following-up on pledges or expressions of interest to the firm or its client;

(B) Checking with users of client-supplied goods or services, for example, to continue or renew recently expired membership, contract, etc.; or

(2) The percentage in subsection (1)(b) of this rule is:

(a) First substantiated by the Firm/applicant or local zone manager with the Application or Preauthorization Conference;

(b) Not predicated on the actual transaction or customer communication through a landline telephone call, but only on relative location as if it were;

(c) Calculated by dividing the number of customers or transactions in the local calling area by the firm’s total, arising from the operations in the zone; and

(d) Not dependent on precise calculation or verification, if the generally regional or national extent or scope of the firm’s activities allow for a reasonable assumption of compliance.

(3) Communications in accordance with this rule will generally be anonymous in nature and involve only a brief period, if any, of repeat interaction on a given matter or order. They do not include the delivery of advice, services or products between known individuals, such as ongoing provision of professional services to clients by any particular employee or agent of the business firm.

History

Statutory/Other Authority: ORS 285A.075 & ORS 285C.060(1)
Statutes/Other Implemented: ORS 285C.135
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-1700 Temporary rule language in effect until 12/01/2026. Headquarter Facilities

For purposes of ORS 285C.135(4)(b):

(1) A Firm/applicant and its operations are eligible, regardless of retail, financial, professional or other such ineligible activities, if:

(a) The business is operating substantially at two or more locations including at least one place outside of the enterprise zone;

(b) The operations in the zone support and serve the firm’s other operations or commercial pursuits throughout this state or throughout a multiple-state or larger region consistent with section (5) of this rule; and

(c) In approving the Application, the local zone manager includes on behalf of the sponsor pursuant to the Preauthorization Conference under ORS 285C.140(7) a formal finding that:

(A) Describes how the proposed investment and the business firm will satisfy subsections (a) and (b) of this section, including indications of applicable services, relevant region and the relationship among intra-firm operations; and

(B) Asserts that the proposed investment is significant for the enterprise zone and the local economy, succinctly explaining the reasons for this significance, such as the size of proposed operations relative to local measures of commerce, special job opportunities, diversification, strategic, marketing or visibility objectives of the zone, or other impacts.

(2) As required under ORS 285C.180(2)(g), the business firm may not qualify for the exemption under ORS 285C.175, if the actual investment in qualified property does not substantively correspond to what was proposed in or with the Application. In determining if an actual investment is significantly inconsistent with such descriptions, relevant factors for the zone sponsor and county assessor to consider include but are not limited to:

(a) Is total cost of investment comparable to estimated costs? …, which under ORS 285C.185(2) is a matter only of relative amounts;

(b) Are the configuration and size of the building(s) similar to what was communicated or documented? …;

(d) Will the facility undertake basically the same administrative, engineering or other (professional service) functions as proposed and otherwise fulfill the finding pursuant to paragraph (1)(c) of this rule? …; or

(e) Is facility employment for purposes of section (4) of this rule like what was predicted?

(3) The local zone manager shall include the formal finding as part of the approved Application and may modify it prior to an authorized business firm qualifying for the exemption, consistent with an amendment for OAR 123-674-3200.

(4) For purposes of OAR 123-674-4000 to 123-674-4800, as provided under ORS 285C.200(7)(b)(B), only the employees working at a facility described in this rule are counted consistent with OAR 123-674-0200(3)(a), and as such, employees of the firm that are transferred to the facility from locations already in the zone may count toward the facility’s requisite increase in employment.

(5) The main commercial pursuit of a business firm may itself be ineligible under ORS 285C.135(1) and (2), but if so, then a facility described in this rule may not be used significantly to carry out such operations, for example, as a center or base of activities or staff that provide services to customers. Rather, the facility must serve the firm’s internal needs with administration, logistics and so forth.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.135, 285C.140, 285C.180 & 285C.200
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-2000 AUTHORIZATION PROCESS — Timely Submission

For purposes of ORS 285C.140(1):

(1) In applying for authorization with the sponsor of an enterprise zone and the county assessor, the Firm/applicant shall:

(a) Fill out the Application as completely as the Firm/applicant is capable of doing;

(b) Have the Application signed and dated by an owner, executive officer or legally authorized representative of such an owner or officer of the Firm/applicant; and

(2) In order for the sponsor to accept the Application from the Firm/applicant for potential approval, all of the actions in section (1) of this rule must happen before:

(a) The Firm/applicant’s hiring of any eligible employee to qualify under ORS 285C.200; and

(b) Any physical work or vesting in the project, such as the start of any of the following: construction or reconstruction of a building or structure, construction of an addition or modifications to an existing building or structure, or installation of machinery and equipment, comprising all or part of the qualified property, on which the Firm/applicant will claim exemption under ORS 285C.175.

(3) Physical work for purposes of subsection (2)(b) of this rule includes site preparation that leads directly to construction, modification or installation of qualified property, such as fill, grading or leveling on raw land or the installation of underground utilities and utility connections, except the following:

(a) Offsite development; or

(b) On-site preparations that are incidental or unrelated to subsequent work on qualified property, such as improvements to prepare land for sale or for another project that did not go forward, to prevent erosion or otherwise maintain the land in good condition, or to accommodate or comply with government regulations or public improvements for roadways, trunk lines or the like.

(4) A faxed, e-mailed or similarly furnished copy of the Application is acceptable, if the copy is:

(a) Received by the zone sponsor before the time described in section (2) of this rule; and

(b) Promptly followed up by signed original to the local zone manager.

(5) Zone officials may verify conformity with this rule, as necessary, through:

(a) Final documents for transfer of ownership, sale closing or execution of a lease;

(b) Building permit or contract;

(d) Similar forms of formal and independently substantiated proof.

(6) The Firm/applicant shall pay an authorization filing fee, if directed to do so by the local zone manager, as described in OAR 123-668-1700.

(7) In the event that the local zone manager does not timely receive an Application as described in this rule, the manager may still accept it if the Firm/applicant produces dated evidence to the satisfaction of the zone manager and assessor that the Application was sent in a timely manner.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.140(1) & (12)
Statutes/Other Implemented: ORS 285C.140 & 285C.145
OBDD 12-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-2100 Allowably Late Applications

Notwithstanding OAR 123-674-2000(2), the zone manager may accept an Application after:

(1) Certain physical work that consists only of:

(a) Demolition, cleanup, environmental remediation, removal of hazardous materials, and so forth;

(b) On-site delivery, storage or upkeep of materials or elements of qualified property prior to their use for construction or installation; or

(c) Construction or the like that occurred and completely ceased six months or longer before Application, consistent with OAR 150-285-3200(3)(b), insofar as the property was not placed in service and is not assessed for the current tax year, and the Application precedes the resumption of work.

(2) The commencement of hiring or physical work, if the Application wholly replaces a previously submitted Application by December 31 immediately before the initial year of exemption consistent with OAR 123-674-3200, such that in this case, the originally submission date is used.

(3) The commencement of hiring or physical work pursuant to a waiver issued by the Department of Revenue according to OAR 150-285-3100, or as otherwise allowed under ORS 285C.140(11) and (12).

(4) The commencement of physical work on a qualified building or structure (aside from associated machinery & equipment) under ORS 285C.145(2), if the following are true:

(a) Firm/applicant did not own or lease any such building or structure, or have a binding obligation to do so, at any time before the commencement of construction, reconstruction or modifications;

(b) Firm/applicant includes a copy of an executed lease or purchase agreement for the qualified building or structure with the Application;

(c) Firm/applicant does not have any familial, employment, corporate or other such entity relationship with the owner or previous owner of the building or structure; and

(d) Approval of the Application occurs before the Firm/applicant begins to use or occupy the building or structure for commercial operations.

(5) The commencement of physical work on one type of property that will not qualify, but before work begins on other property that may qualify, as differentiated under ORS 285C.180(1) consistent with OAR 123-674-3100(3).

(6) Even the completion of construction, modifications or installations as otherwise allowed in sections (2) to (5) of this rule.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.140(12)
Statutes/Other Implemented: ORS 285C.140 & 285C.145
OBDD 34-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-2300 Temporary rule language in effect until 12/01/2026. Initial Processing by Local Zone Manager

Following submission of an Application:

(1) The local zone manager may collect an authorization filing fee as described in OAR 123-668-1700.

(2) The local zone manager shall deny the Application if finding:

(a) The Firm/applicant does not fulfill any basis for eligibility under ORS 285C.135;

(b) The Firm/applicant is unwilling or unable to unambiguously commit to an action/obligation as required under ORS 285C.140(2);

(d) The location of proposed qualified property is outside the enterprise zone boundary and no relevant boundary change is pending (or possible); or

(e) Any other reason that precludes authorization.

(3) Within 15 business days of denial in section (2) of this rule, the local zone manager shall:

(a) Refund any authorization filing fee that was paid;

(b) Write a letter to the Firm/applicant that justifies the denial;

(d) Ensure that the letter:

(A) Is sent to the Firm/applicant through certified mail or in such a way that the date of receipt can be verified; and

(B) Contains information on the Firm/applicant’s rights of appeal under ORS 305.404 to 305.560 to the Magistrate Division of the Oregon Tax Court.

(4) If there is no apparent reason to deny authorization, according to section (2) of this rule, then the local zone manager shall undertake the Preauthorization Conference, inviting the county assessor, to explore any outstanding eligibility issue, extended abatement criteria, matters related to OAR 123-674-4000 through 123-674-4600, and so forth.

(5) With respect to a sponsor’s failing to authorize under ORS 285C.140(9), a Firm/applicant may proceed with an appeal after 30 days following the submission of the Application, if no formal action is yet to be taken as described in this rule or in response to special circumstances in OAR 123-674-2500(4).

(6) After the Preauthorization Conference, the local zone manager shall approve the Application in order to authorize the Firm/applicant under ORS 285C.140, unless determining to deny it as described in sections (2) and (3) of this rule.

(7) If the Firm/applicant’s will locate in an urban enterprise zone that imposes additional conditions under ORS 285C.150 in effect at the time of authorization, the local zone manager shall:

(a) Approve the Firm/applicant for authorization only if the Firm/applicant has made acceptable commitments to satisfy such conditions; and

(b) Include a standardized attachment to the Application documenting the commitments of the Firm/applicant consistent with OAR 123-668-2500.

(8) If the Firm/applicant and zone sponsor agree to flexible hiring timelines as allowed under ORS 285C.200(2)(a), the Firm/applicant and zone sponsor will establish a flexible hiring timeline and alternative performance criteria during the period of the exemption that the qualification is delayed in a written agreement.

(9) If the Firm/applicant and zone sponsor agree to alternative performance criteria under ORS 285C.200(2)(b), the Firm/applicant and zone sponsor will establish the alternative performance criteria requirements that meet the required minimum in a written agreement.

(10) In five or fewer business days after approval, the local zone manager shall:

(a) Fill out and sign the Approval Form except for the section pertaining to the county assessor;

(b) See that the county assessor has the Approval Form and a copy of the Application (with all current attachments);

(d) Inform the local contact agency for the First Source Hiring Agreement for purposes of OAR 123-070 and 123-674-7000 to 123-674-7730.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-2500 Temporary rule language in effect until 12/01/2026. Final Processing

Pursuant to OAR 123-674-2300:

(1) The county assessor or county assessment staff to whom the assessor delegates enterprise zone duties shall:

(a) Accept any requisite invitation to a Preauthorization Conference, as feasible and warranted;

(b) Approve or deny the Application within a reasonable time after receiving the Approval Form from the local zone manager;

(c) Fill out and sign the pertinent section of the Approval Form, retain copy for assessor’s records, and return the form to or process it on behalf of the local zone manager, within five or fewer business days after making a decision in subsection (b) of this section; and

(d) Include a written explanation with the materials returned to the local zone manager if denying authorization for any reason in OAR 123-674-2300(2).

(2) The assessor or staff may refuse to approve the Application on condition of receiving reasonably critical information from the Firm/applicant or zone sponsor, including but not limited to resolving a concern raised with the Preauthorization Conference, or of holding an additional meeting if not properly notified of any prior meeting.

(3) If the county assessor denies the Firm/applicant’s authorization, the local zone manager or county assessor shall within 15 or fewer business days after denial:

(a) Refund any authorization filing fee that was paid.

(b) Have the Approval Form and the county assessor’s written explanation sent to the Firm/applicant through certified mail or in such a way that the date of receipt can be verified and have copies distributed to the Department of Revenue and the Department.

(4) Pending the completion and inclusion of any of the following as part of the Application (to which they shall be attached), the local zone manager and county assessor shall delay final processing of the Approval Form notwithstanding subsection (1)(c) of this rule:

(a) Written agreement in OAR 123-674-0700 for an extended abatement, except as incorporated in documentation of an urban enterprise zone’s standard conditions with OAR 123-674-2300(7);

(b) Written agreement in OAR 123-674-0350 for alternative performance criteria or flexible hiring timeline in OAR 123-674-0400;

(c) Resolution of the governing body or bodies of the zone sponsor for a local waiver to establish allowable business activities consistent with OAR 123-662-2100;

(d) Resolution or resolutions of the governing body or bodies of the zone sponsor for a local waiver of the employment increase requirement in OAR 123-674-4300; or

(e) Executed lease or purchase agreement, but only as necessary for OAR 123-674-2100(4).

(5) Subject to both the local zone manager and county assessor approving the Application, as well as wrapping up special circumstances in section (4) of this rule, the local zone manager or county assessor shall:

(a) Immediately furnish the completed and signed Approval Form to the Firm/applicant, along with the summary or record of Preauthorization Conference, and executed or final copies of any document for purposes of OAR 123-674-2300(7) or subsection (4) or (b) of this rule;

(b) Promptly distribute a copy of the form and Application to the local contact agency for the First Source Hiring Agreement without Application attachments or other documents; and

(c) Not later than 30 days after approval, see that the Department of Revenue and the Department receive a copy of the form and Application (with summary or record of Preauthorization Conference), and final or executed copies, as applicable, of any:

(A) Documentation for an urban zone’s standard conditions;

(B) Written agreement for an extended abatement with any associated resolution or warrant of local government approval;

(D) Other materials pertaining to authorization of the Firm/applicant or as directed by the Department of Revenue or the Department, which would not typically include copies of lease agreements or First Source Hiring Agreements.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.145, 285C.150, 285C.155 & 285C.160
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 19-2020, minor correction filed 09/01/2020, effective 09/01/2020
OBDD 16-2020, minor correction filed 08/31/2020, effective 08/31/2020
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-3000 AUTHORIZATION'S COVERAGE & EFFECT — Being An Authorized Firm

(1) For purposes of ORS 285C.050 to 285C.250 and this division of administrative rules, the Firm/applicant becomes “authorized” only upon fulfillment of OAR 123-674-2500(5). (As applicable, the Established County Wage is primarily set at this point based on the Current County Wage)

(2) Authorization serves to establish and address critical issues related to a Firm/applicant’s knowledge of the enterprise zone, the eligibility of its business activity, Existing Employment, clarity in the unlikely event of concurrent Applications, and so forth.

(3) Authorization does not as such govern the qualified property subject to exemption under ORS 285C.170 or 285C.175, other than the basic, general parameters described in OAR 123-674-3100, in that:

(a) The anticipated timing, estimates and descriptions of the investment in qualified property in the Application are not in and of themselves binding and do not serve a regulatory function.

(b) The two exceptions to this section are qualified property of a headquarter-type facility (see OAR 123-674-1700) or in a rural renewable energy development zone (see OAR 123-680), in that the actual, completed project or facility must conform substantially to representations in the Application to enjoy the standard exemption under ORS 285C.175.

(4) Such authorization must already be in effect for the Firm/applicant to use the exemption on qualified property under ORS 285C.170 for work in progress, as described in OAR 123-674-6000, although the Firm/applicant may apply for and receive exemption on property as otherwise allowed under ORS 307.330.

(5) In order to receive exemption under ORS 285C.175 on qualified property that is in service:

(a) The zone sponsor/county assessor shall authorize the Firm/applicant, at the absolute latest, before it files its initial claim for exemption with property schedule under ORS 285C.220 and 285C.225.

(b) Such an exemption claim may be provisionally filed pending authorization delayed for extenuating circumstances through no fault of the Firm/applicant, but authorization must occur before the firm may qualify for the exemption.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.170, 285C.175, 285C.220 & 285C.225
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-3100 Limitations on Exemption Relative to Authorization

Under ORS 285C.180(2)(d) to (f) and 285C.225(3), the Application and information in it restrict what will be exempt under ORS 285C.170 or 285C.175 in only the following four ways, in that qualified property must be:

(1) Possessed for use by the Firm/applicant or qualified business firm, such that it either owns the property or leases it consistent with OAR 123-674-5500, except as allowably transferred to another eligible business firm acquiring the authorized firm or the property, including but not limited to OAR 123-674-3200(1)(a) or (3)(c) or 123-674-4800.

(2) At the same general location when the exemption begins:

(a) That encompasses a single, coherent area of business operations;

(b) Which may consist of a complex of lots or parcels of land or of a comparably proximate set of multiple sites, such that each lot, parcel or site is separated one from the other by commonly owned land, and not otherwise broken up except by roads, easements and so forth; and

(c) Which the Firm/applicant need not describe in whole, such that inclusion in the Application of a street address or tax lot within the overall area is sufficient.

(3) Generically identified in terms of:

(a) Any building or structure, which has construction, reconstruction or modification costs of $50,000 or more (An Application’s reference to a project, for which associated improvements are implicit, may be treated as adequate for this subsection).

(b) The basic category of property, regardless of cost, as represented in some way with respect to:

(A) Newly constructed buildings/structures;

(B) Additions to or modifications to existing buildings, structures or portions thereof;

(D) Modifications to real property machinery & equipment under ORS 285C.190; or

(E) Newly installed personal property.

(4) Placed in service over not more than three successive years, such that:

(a) Once the business firm successfully claims any exemption pursuant to the Application (whether later or earlier than anticipated), subsequent exemptions may be claimed based on the same Application only in one or both of the next two years. This is true regardless of an extended abatement or the length of the underlying periods of exemption.

(b) Additional qualified property covered by each subsequent exemption necessitates its being:

(A) Placed in service during the first or second year of the initial exemption; and

(B) Listed in a new property schedule under ORS 285C.225, as filed with the same exemption claim for that and prior property (see OAR 123-674-6100 and 123-674-6200).

(c) Each exemption as described in this section shall enjoy its own three to five-year exemption period, which will overlap.

(d) All overlapping and ongoing exemptions for purposes of this section are subject to disqualification for noncompliance based only on:

(A) Requirements arising from that Application; and

(B) The applicable time frame respective to each exemption period.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.170, 285C.175, 285C.180, 285C.185, 285C.190, 285C.220 & 285C.225
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-3200 Amending the Application/Authorization

For purposes of amending an application before or after its approval:

(1) To substantively modify the Application, such that it reestablishes what might be exempt as described in OAR 123-674-3100, the Firm/applicant must formally deliver the amendment on or before December 31 preceding the initial year of actual exemption, including but not limited to a late filing under ORS 285C.220(9), in order to:

(a) Change the Firm/applicant to that of another eligible business firm that has or is purchasing or leasing only qualified property of the Firm/applicant in contrast to subsection (3)(c) of this rule;

(b) Revise the location of the property inside the same enterprise zone; or

(c) Add a structure or basic type of property absent from the Application, or distinct projects or operations entailing substantial new development.

(2) The Firm/applicant shall do so by furnishing to the local zone manager and county assessor:

(a) A written explanation that is identified as an amendment, addendum, correction or the like in reference to the Application;

(b) Edits or revisions made directly to previously submitted materials; or

(3) Amendment is strongly encouraged at any time, even if unnecessary to secure exemption on particular property, whenever information in the submitted Application is significantly inaccurate due to:

(a) An error or omission;

(b) A change in plans; or

(c) New name or mailing address of the Firm/application, because of the company’s restructuring or its ownership changing hands, in which case the relevant rights and requirements of authorization automatically transfer along with ownership of the firm; or

(d) Similar reasons.

(4) An authorization renewal statement under ORS 285C.165 shall revise all information in the Application that is no longer accurate, especially with respect to anticipated timing for the investment (see OAR 123-674-3700).

(5) Once the Firm/applicant is authorized, an amendment may not be used to make or alter a determination, waiver, extension or the like under ORS 285C.150, 285C.155, 285C.160, 285C.200(2) or 285C.205.

(6) Within 30 days of receiving an amendment to a previously approved application, the zone manager shall see in accordance with OAR 123-674-2500(5) that:

(a) The Firm/applicant is informed of the amendment’s acceptance or of any further issue;

(b) The local contact agency for the First Source Hiring Agreement is apprized, as relevant, of changes to the firm or its location; and

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.145, 285C.165, 285C.180 & 285C.220
OBDD 35-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-3500 Additional, Concurrent Authorizations

While amendment to an outstanding Application as described in OAR 123-674-3200 is generally preferable for reasons of simplicity, approval of two or more outstanding Applications for the same Firm/applicant in the same enterprise zone is allowable, and in some cases, desirable or necessary:

(1) The Firm/applicant must make another Application for any case that goes beyond what a single Application may cover, according to OAR 123-674-3100, such as investments in qualified property:

(a) At more than one general location inside the zone;

(b) Inadequately indicated in the Application in terms of a basic type of property or major improvement, once the first year of the initial exemption has already begun; or

(c) That will not be in service until the third or later year following the first exemption year of initial property covered by a current authorization.

(2) For any additional Application even if for proposed qualified property at the same site identified in another Application:

(a) It must be timely submitted according to OAR 123-674-2000 and 123-674-2100 before the commencement of work on that newly proposed property; and

(b) It establishes unique Existing Employment and resulting criteria under ORS 285C.200 and 285C.210.

(3) In the event of concurrent exemptions under ORS 285C.175 on qualified property covered by two or more Applications even for the same location, the authorized business firm shall file separate exemption claims and property schedules, as described in OAR 123-674-6100 and 123-674-6200, corresponding to each Application and associated qualified property, such that qualification depends on satisfying:

(a) Criteria arising from the Application most clearly associated with the particular property (including but not limited to consideration of when work on such property actually commenced).

(b) The effectively most stringent requirement among outstanding Applications for any qualified property that does not definitively relate to any particular Application.

(c) The effectively least stringent requirement among the outstanding Applications for qualified property that specifically relates to two or more Applications.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.170, 285C.175, 285C.220 & 285C.225
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-3700 Renewal of Active Status and Inactive Authorization

Under ORS 285C.165 an eligible business firm’s authorization in an enterprise zone becomes ‘inactive’ after more than two years, such that:

(1) The authorization remains active over:

(a) The remainder of the year after approval of the Application;

(b) The two-year period immediately following; and

(c) Each two-year period directly thereafter, subject to a statement of renewal as described in subsection (2)(b) of this rule.

(2) Authorization is still active if immediately after any period described in section (1) of this rule, the firm:

(a) Files successfully under ORS 285C.220 and 285C.225 to initially claim exemption on qualified property placed in service during such a period, at which point this rule is no longer operative; or

(b) Submits a written statement between January 1 and April 1 (as presently received by both the local zone manager and the county assessor’s office) that:

(A) Comes from the firm consistent with authority required for making Application;

(B) Informs or indicates that the firm still intends to complete its proposed investment in qualified property inside the zone and to claim the exemption; and

(3) With respect to a statement in subsection (2)(b) of this rule:

(a) Whether acknowledged by the firm or not, the Established County Wage applicable to any compensation standard is reset to the Current County Wage at the time of the statement’s submission.

(b) Neither filing for any construction-in-process exemption nor filing a claim under ORS 285C.220 for an exemption that is denied substitutes for the requisite statement.

(4) An inactively authorized business firm retains its right to claim the exemption after the periods described in section (1) of this rule, but letting active status lapse has the following consequences:

(a) With the initial exemption claim in an existing enterprise zone:

(A) Filing fee under ORS 285C.165(3) is charged; and

(B) Established County Wage with any compensation standard is reset to the Current County Wage at the time of filing the claim;

(b) Prior to that claim, even if the zone is currently still designated, the firm may not receive exemption under ORS 285C.170 while qualified property is in the process of construction, modification or installation, but it may still seek exemption under applicably comparable provisions of ORS 307.330 and 307.340; and

(c) The firm is not effectively authorized under ORS 285C.245(5) for purposes of OAR 123-650-9500 or 123-650-9600 at the time of the zone’s termination.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.160, 285C.165, 285C.170, 285C.175, 285C.220, 285C.225 & 285C.245
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4000 EMPLOYMENT OF FIRMS — Computation of Averages

(1) Annual Employment or Existing Employment is calculated, such that:

(a) The actual employment of the firm at the end of each period (for example, pay periods or calendar months) that concludes during any exemption year or the entire 12 months before the Application shall be summed and then divided by the total number of periods.

(b) Periods may not be longer than calendar quarters that begin on January 1, April 1, July 1 and October 1.

(2) For purposes of determining Existing Employment relative to the submission of the Application:

(a) The time when applicable physical work began shall be used instead of the submission date, as necessary for situations when timely submission has been waived under ORS 285C.140(12)(b).

(b) If such physical work has not yet begun, an authorized business firm may submit a replacement Application to establish a lower level of Existing Employment; otherwise, the number from the original submission date stands.

(c) The Firm/applicant may correct for a miscalculation by amending the Application under ORS 285C.140(3) consistent with OAR 123-674-3200, including but not limited to erroneously inclusion of part-time, temporary, seasonal or ineligible employees.

(d) After the first (January-1) assessment date for exemption under ORS 285C.175, Existing Employment may be altered only to correct for a fundamental mistake, subject to a formal finding of good cause by the Department.

(3) Employment of the firm at any location amended into the enterprise zone by a boundary change shall be treated as part of the zone for determining Existing Employment over the entire 12 months before the Application, if the boundary change:

(a) Took effect during that 12-month period; or

(b) Adds the location of qualified property indicated in the Application to the zone.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.140(12)
Statutes/Other Implemented: ORS 285C.140, 285C.200 & 285C.210
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4100 Temporary rule language in effect until 12/01/2026. Employment Requirement to Qualify Initially

Unless a flexible hiring timeline is agreed upon between the firm and the zone sponsor as described in OAR 123-674-0400, to receive and begin an enterprise zone exemption under ORS 285C.175, an authorized business firm must qualify by filing under ORS 285C.220 and 285C.225 as described in OAR 123-674-6100:

(1) The first Claim Employment must equal or exceed the greater of one plus or 1.1 times the Existing Employment:

(a) If at the time of filing, however, the actual Claim Employment is insufficient, the requirement under ORS 285C.200(1)(c) and this section is nevertheless satisfied, provided that employment was high enough at some time by April 1 but after making Application as documented with the claim form.

(b) For a subsequent exemption on additional qualified property pursuant to the same Application, as described in OAR 123-674-3100(4), the requirement of this section has effectively already been satisfied.

(2) If section (1) of this rule is not satisfied, then the county assessor shall deny the exemption claim and not grant any exemption under ORS 285C.175 on qualified property, except with a waiver by the zone sponsor and qualification as described in OAR 123-674-4300. Such denial does not directly affect the firm’s authorization status and its ability to qualify other (later) property under ORS 285C.170 or 285C.175.

(3) Under ORS 285C.200(5) any transfer of eligible employees, jobs or positions into the zone from a site within 30 miles outside the zone boundary, occurring between the time of the Application’s approval (authorization) and the end of the initial year of exemption, triggers an additional requirement in terms of section (1) of this rule, in that the definitions of Claim Employment and Existing Employment expand to also include the number of employees located at any such site, as well as those inside the zone.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, 285C.175, 285C.200, 285C.220 & 285C.225
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4200 Diminishing Employment Well beyond the Zone

Under ORS 285C.200(1)(d) and (4) an authorized business firm seeking an exemption in any enterprise zone may not qualify or remain qualified, if the firm transfers operations into the zone involving the closure or curtailment of operations and a drop in employment (job losses) elsewhere in this state, unless:

(1) The originating location is 30 miles or less from the boundary of the zone, and the firm meets the requirements under ORS 285C.200(5) and 285C.210(2)(c) described in OAR 123-674-4100(3) and 123-674-4600(2); or

(2) The firm demonstrates, with or without the assistance of the zone sponsor, to the satisfaction of the county assessor or the Department that the curtailment/job losses:

(a) Occurred entirely before the Application’s approval (authorization);

(b) Occur entirely after the initial year of exemption on qualified property;

(c) Will not be permanent, such that restoration of the jobs is reasonably likely and does in fact happen on or before December 31 of the initial year of exemption;

(d) Pertain to business operations that the firm does not control in any way through common ownership, corporate affiliation, contracts governing relevant operations, or the like;

(e) Are completely unrelated to any new investment or expansion of activity in the zone, so that there is effectively no transfer of curtailed operations or jobs into the zone;

(f) Relate only to operations that are ineligible in the enterprise zone; or

(g) Have only de minimis impact, which the Department may deem true if job losses will amount to less than one one-hundredth of 1 percent (0.01%) of the most recently available figure for Current Employment Estimates (CES) from the State Employment Department for annual average total nonfarm, private employment in the county experiencing curtailed operations.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.200, 285C.210 & 285C.240
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4300 Temporary rule language in effect until 12/01/2026. Local Waiver of Employment Increase inside Zone

For purposes of ORS 285C.200(3), in which the local enterprise zone sponsor waives the required increase in the employment of the firm:

(1) With such a waiver, the requirements described in OAR 123-674-4100(1) or 123-674-4600(1) do not apply, but requirements or restrictions related to transferring existing employment or operations into the zone from elsewhere in Oregon still matter, consistent with OAR 123-674-4100(3), 123-674-4200 and 123-674-4600(2), and are not subject to any such waiver.

(2) Each governing body of the sponsor must adopt a resolution under ORS 285C.155:

(a) Before authorization of the eligible business firm;

(b) Stipulating the minimum employment level to be maintained during the exemption as described in section (4) of this rule; and

(3) The resolution(s) described in section (2) of this rule shall incorporate either:

(a) The minimum amount of investment according to section (5) of this rule; or

(b) Specifications and methods for managing, measuring and enforcing the requirements under ORS 285C.205, by which the authorized business firm shall effectively:

(A) Increase productivity by 10 percent; and

(B) Dedicate to employee or workforce training an amount at least equal to 25 percent of the property tax savings through deposits into an account as noted in OAR 123-668-1600(1)(b).

(4) The minimum employment as stipulated in the resolution(s):

(a) Is a single, stated number of employees;

(b) May be determined, as indicated in the resolution(s), by way of either Annual Employment or Claim Employment; and

(A) Shall be at least the same if using the productivity and workforce training provisions for a waiver under ORS 285C.200(2)(b)(B) according to subsection (3)(b) of this rule; or.

(B) May be lower for a waiver under ORS 285C.200(2)(b)(A) subject to section (5) of this rule

(5) For a waiver based on ORS 285C.200(3)(b)(A), the authorized business firm must make an investment in qualified property under ORS 285C.050:

(a) That is placed in service over not more than three successive years, at one or more locations inside the same enterprise zone (… and pursuant to as many Applications inasmuch as property at such locations is also to be exempt);

(b) Regardless that some such qualified property is not actually exempt under ORS 285C.175, including but not limited, for example, to the property’s not being used in eligible activities; and

(6) Prior to July 1 of the first tax year of exemption, the sponsor may (jointly) modify its resolution in accordance with sections (2) to (4) of this rule, but only if requested as such by the firm.

(7) Failure to satisfy the minimums, requirements or conditions, as described in this rule, shall result in the exemption’s denial or disqualification, except if the firm otherwise meets requirements described in OAR 123-674-4100(1) or 123-674-4600(1). The county assessor is in no way obligated to consider the firm’s compliance with respect to any requirement arising from subsection (2)(c) or (3)(b) of this rule without formal confirmation from the zone sponsor.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.155, 285C.200, 285C.205, 285C.230 & 285C.240
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4600 Maintaining Sufficient Employment

For purposes ORS 285C.200(1)(e) and 285C.210:

(1) Failure occurs (unless it has been waived in OAR 123-674-4300) if:

(a) The latest Annual Employment is less than the greater of one plus or 1.1 times the Existing Employment;

(b) The current Claim Employment is less than 15 percent of any previous Claim Employment; or

(c) Both the current Claim Employment and the one from the prior year are less than 50 percent of any previous Claim Employment.

(2) Subject to OAR 123-674-4100(3)’s being effective, a qualified business firm must likewise meet an additional requirement in terms of section (1) of this rule but only for the initial year of exemption , in that the definitions of Annual Employment, Claim Employment and Existing Employment expand to include employees located at any relevant site outside but within 30 miles of the zone boundary, as well as jobs inside the zone.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.200, 285C.210, 285C.220, 285C.230 & 285C.240
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-4800 Sale or Leasing of Exempt Property

For purposes of ORS 285C.175(2)(b), a qualified business firm may sell or lease qualified property, and the exemption that is about to begin or is ongoing may continue for the remainder of its normal period. This rule depends on all of the following, otherwise the exemption is subject to denial or to disqualification for an event under ORS 285C.240(1)(a) or (e) with repayment of back taxes, as applicable:

(1) The qualified property was located at the site identified in the Application (as potentially amended) when it first qualified, and it continues to be eligibly used inside the enterprise zone.

(2) The purchaser or lessee is an eligible business firm.

(3) Requirements in OAR 123-674-4000 to 123-674-4600 are effectively satisfied, including that the combined Annual Employment of the purchaser/lessee and of the originally qualified business firm equal or exceed the sum of:

(a) The minimum Annual Employment required of the firm in OAR 123-674-4600(1)(a); and

(b) The annual average employment of the purchaser/lessee in the zone immediately prior to the change in ownership/lease.

(4) That the purchaser/lessee and the qualified property comply with all other applicable requirements.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050, 285C.175, 285C.210 & 285C.240
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5000 QUALIFIED PROPERTY— Critical Terms

As used in ORS 285C.050 to 285C.250 and in this division of administrative rules, consistent with relevant definitions in ORS Chapter 307 and OAR 150-285-3200, unless the context dictates otherwise:

(1) Addition includes one or both of the following as indicated by the context:

(a) The re-construction of an existing building or structure to expand or enlarge its area, volume, dimensions or structural capacity; or

(b) The newly erected or created space, enclosure or annex of the building or structure, pursuant to the re/construction described in subsection (a) of this section.

(2) Building includes a real property improvement erected on the land, mostly enclosed by walls and roofing, and designed for human use, occupancy or shelter, along with structural components necessary to make the building usable and habitable such as wiring, plumbing, foundation, fixtures, lighting and heating and cooling system.

(3) Commercial relates to the principal undertaking by a qualified business firm in the direct furtherance of the production of income through the handling, making or provision of goods, products or services for ultimate (though not typically direct) sale.

(4) Completion of construction, addition, modification or installation has the same meaning as placing property ‘in service’ under ORS 285C.050(11), in that the property is legally and physically ready for commercial operations as specifically intended, following interconnected installations, testing or proving of safety, information and other systems essential to produce saleable output, as well as necessary occupancy or other permits. Excluded are training of personnel and other similarly intangible activities or managerial issues, however critical they might be for business operations in general.

(5) Cost means expenses documentable through existing records or retrospective compilation of evidence as incurred for:

(a) Construction, reconstruction, modification or installation of qualified property, including but not limited to materials, supplies, labor, paint, contractor charges, equipment usage, engineering, architectural fees, building or land use permits and associated legal costs, and physical connections to utilities and other property, but excluding the costs of maintenance, financing, atypical legal fees, off-site improvements, the authorized business firm’s own management and so forth; or

(b) Purchase of real or personal property machinery & equipment or of ready-made buildings or structures directly prior to installation or occupancy. Estimated fair market value shall substitute for purchase price in the case of existing property, for which there has not been a recent sale (for example, leasing of used property).

(6) Installation is the actual placement, affixing, connection or integration of machinery & equipment or personal property in or with a building, structure or other machinery & equipment for purposes of being used and does not mean the purchase, onsite delivery or storage of such property.

(7) Item, subject to further definition in OAR chapter 150 under ORS 285C.185(6)(b), includes any personal property that may be effectively appraised or assessed as a unit, including but not limited to an entire conveyance, information or other system, the various components of which are mechanically, electrically or similarly integrated.

(8) Land includes raw undeveloped land and any improvements to the land for site development.

(9) Located in/inside the enterprise zone means the use or operation of qualified property for trade or business operations within the current boundary of the enterprise zone, from which it is not removed during the standard exemption period other than incidental or temporary reasons of repair, maintenance and so forth.

(10) Modification under ORS 285C.050 comprises:

(a) Reconditioning, refurbishment, retrofitting or upgrading of real property machinery & equipment for purposes of ORS 285C.190; or

(b) The alteration or reconstruction of all or part of an existing building or structure, as distinct from an addition to the building or structure.

(11) Personal property includes any tangible property (readily movable as opposed to effectively fixed or very heavy) that is used in the business process or activity and is otherwise subject to ad valorem taxation, including but not limited to devices, tools and (former) spare parts that are put to use (see OAR 123-674-5200).

(12) Production of tangible goods means any physical process or manipulation of materials, commodities or products, including but not limited to manufacturing, assembly, sorting, cooking, heating, freezing, mixing, sorting, wrapping, onsite conveyance, packaging or bulk printing.

(13) Real property machinery & equipment (fixed or stationary in contrast to personal property due to weight, size or attachment to or integration with other real property) is real property used in the business process or activity and not otherwise described in this rule, including but not limited to major machines, specialized pipes, air filtration systems, wiring, electrical panels or switches, or other non-structural, assembled apparatuses. (This type of property may be classified as ‘tangible personal property’ for income tax or other purposes)

(14) Structure includes a real property improvement on or under the land other than buildings, machinery or equipment, including but not limited to ramps, docks, parking lots, outdoor freestanding signs, subterranean compartments and outdoor lighting, as well as associated fixtures, paving, wiring, pipes, foundations and so forth.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.050 – 285C.250
OBDD 36-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 15-2017, minor correction filed 12/28/2017, effective 12/28/2017
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5050 Property at Time of Zone Designation or Amendment

Respective to an enterprise zone exemption on qualified property under ORS 285C.170 or 285C.175 and the effective date of a zone’s designation or of a boundary change that brings the property’s location into the zone:

(1) Property or its existing value may not be exempt if before such an effective date that property/value was already:

(a) On the assessment rolls of the county irrespective of location or of ownership/lease; or

(b) Located in the zone or in the process of actual construction, improvement, modification or installation there, irrespective of any:

(A) Site preparation or land development even if onsite and leading to construction, though still needing to occur after Application consistent with OAR 123-674-2000(3); or

(B) Activity described in OAR 123-674-2100(1) such as demolition.

(2) A Firm/applicant may seek authorization and even have its Application approved before but pending such an effective date.

(3) Section (1) of this rule does not apply if the location of an authorized business firm’s (proposed) qualified property was part of a terminated zone that is included in the newly designated or amended zone, such that:

(a) The authorization transfers directly to the new zone, provided that the authorization was otherwise still valid consistent with OAR 123-674-9500 or 123-674-9600 in the terminated zone as of the effective date of the designation or boundary change; and

(b) The active or inactive status of the authorization will depend on ORS 285C.165 and the date of the Application’s approval or of any statement according to OAR 123-674-3700.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.140, 285C.165, 285C.170, 285C.175 & 285C.245
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-674-5100 Eligible Utilization

In order for ‘qualified property’ under ORS 285C.050(16), to actually be exempt in an enterprise zone under ORS 285C.170 or 285C.175:

(1) It also must be effectively and primarily used in one or more eligible activities described in OAR 123-674-1100 and not but seldom used in an activity listed in OAR 123-674-1200(1).

(2) Consistent with section (1) of this rule, some property will typically not qualify for the exemption, including but not limited to the following examples:

(a) Commercial fixtures and space in a retail setting;

(b) A commercially operated kitchen and associated fixtures and appliances for retail food service;

(c) Entertainment, recreational and exercise facilities or equipment (except as dedicated workplace amenities for employees, who are actually engaged in and do not merely support eligible activities);

(d) Medical devices; or

(e) Construction equipment.

(3) Sections (1) and (2) of this rule are excepted in the case of otherwise qualified property that is used for operations and at facilities described in OAR 123-674-1200(3) or (4), including but not limited to electronic commerce operations in a so-designated area as described in OAR 123-662.

(4) Any such property must also:

(a) Relate to the Application consistent with OAR 123-674-3000 through 123-674-3500; and

(b) Be constructed, added to, modified or installed in the zone to serve essentially only commercial/non-personal purposes.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.135, 285C.180, 285C.185 & 285C.240
OBDD 37-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5200 Mechanical, Personal and Unqualified Property

For purposes of enterprise zone property to be exempt under ORS 285C.170 or 285C.175:

(1) Real property machinery & equipment or personal property may qualify despite prior usage outside the zone, such that the exempt value is based on the usual factors of appraisal, such as age, deterioration and obsolescence, as well as any reconditioning, refurbishment or restoration.

(2) Except in the case of OAR 123-674-5300(5):

(a) Personal property or real property machinery & equipment must be:

(A) Newly owned or leased by the authorized business firm; or

(B) Newly brought into the county containing the site of the property inside the zone.

(b) For purposes of this section, “newly” means that the property is not both acquired by the firm and located in the county before the earlier of:

(A) Six months prior to Application; or

(B) January 1 of the year preceding its first exemption year under ORS 285C.175.

(c) Newly acquired or relocated property that conforms to this section might even be used in the county outside the enterprise zone, before it is placed in service and subsequently exempted in the zone, subject to compliance with other applicable provisions, and provided that it is not subsequently assessed at any location outside the zone.

(3) An item of personal property with a cost of less than $50,000 qualifies for the exemption only if used:

(a) Exclusively in the production of tangible goods, which by itself will usually preclude furniture or decorations and most communication, office, video or comparable devices;

(b) In electronic commerce within a so-designated area as described in OAR 123-662; or

(4) Subsection (3)(a) of this rule with respect to tangible goods production also covers personal property items of machinery & equipment:

(a) Even if the tangible good in question is not actually created or manufactured from raw inputs, but is instead modified, processed, restored, repaired, measured, sized, imprinted, packaged, conveyed, shipped or comparably affected in a physical manner.

(b) That maintain, calibrate, adjust, monitor, test or fix qualified property directly involved with tangible output or production, or that assure quality control of tangible output or production, including but not limited to research and development equipment incorporated into production activities.

(5) For purposes of qualification, the following are equivalent to newly installing personal property or real property machinery & equipment after making Application:

(a) Connection or attachment to existing machinery & equipment of an item that is separately assessed in its own right; or

(b) Comprehensive rebuilding in place of what effectively constitutes a new item for valuation or assessment as distinct from modification.

(6) Regardless of any other provision of this division of administrative rules, the following property does not qualify for the exemption:

(a) Land or improvements to raw land, such as site preparation.

(b) Any item of personal property with a cost of less than $1,000.

(d) Any machinery, equipment or device that can roam freely by its own motive power under the control of an operator/driver, including but not limited to forklifts.

(e) Any other similarly self-propelled motorized vehicle, including by remote control.

(f) Any device or item that is pulled, pushed or carried by a vehicle and designed to hold and transport people, goods or property on highways, waterways or railways beyond the zone boundaries, including but not limited to trailers, rolling stock, barges, carriages or railroad cars.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.180, 285C.185 & 285C.190
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5300 Buildings, Structures and Other Real Property

For purposes of real property in an enterprise zone to be exempt under ORS 285C.170 or 285C.175:

(1) The following do not qualify, unless the cost of all such property collectively in a single property schedule under ORS 285C.225 equals or exceeds $50,000 in total:

(a) New construction of or additions, modifications or improvements to a building or structure; or

(b) Real property machinery & equipment as newly installed or as modified according to section (5) of this rule.

(2)(a) Qualified property, including but not limited to a building or structure, is severable under ORS 285C.180(5), such that:

(A) A part of the building or structure may be exempt, even if another part of the same building or structure is owned or leased by a different business firm, used for ineligible activities, or otherwise not subject to the same exemption; and

(B) The amount of property value that is exempt shall be determined through pro rata calculation based on floor area or other reasonable method, as preferably considered with the Preauthorization Conference, and verified by the zone sponsor as necessary.

(b) Such severability does not pertain to timely Application under ORS 285C.140(1); for example, later construction of portions of a building may not qualify if any such work began before submission of the Application, although subsequent installation of machinery & equipment in general may.

(3) Landscaping or comparable elements may qualify, for example, at a golf course in the case of a hotel, motel or destination resort under ORS 285C.185(4), if classified by the county assessor as structural improvements rather than enhancements to the land.

(4) The exemption on qualified additions, modifications, reconditioning, refurbishment, retrofits or upgrades under ORS 285C.175(3)(b) is measured in each year by:

(a) Computing the assessed value of such taxable property (lesser of real market value or maximum assessed value in each case):

(A) With such qualified improvements or changes; and

(B) As if such qualified improvements or changes had not happened (that is, the assessed value that would have been subject to taxation) but accounting for other concurrent changes to the property.

(b) Taking the difference between the values described in paragraphs (a)(A) and (a)(B) of this section, such that any negative difference equates to zero.

(5) Modifications to an item of machinery & equipment qualify under ORS 285C.190 only if it is real property, and all of the following are true:

(a) Descriptions in the Application (including as amended) recognize such modifications as a basic property type;

(b) On the date of Application the property was idle or not in use;

(d) Previously, the item had been in actual use for 12 or more consecutive months in the same county or zone as where it is placed back into service;

(e) Work to modify the item commenced on or after the date of Application and the enterprise zone’s designation or amendment;

(f) The total cost of modification equals $50,000 or more; and

(g) It is placed back into service no more than 12 months before the first exemption year pursuant to modifications.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175, 285C.180, 285C.185 & 285C.190
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5400 Property Already Entered on Rolls

(1) Other than the qualifying value consistent with OAR 123-674-5300(4) or (5) of later additions or modifications, property already entered on the assessment roll of the county before the effective date of the zone’s designation or amendment of the property’s location into the zone is not qualified property and may not receive exemption under ORS 285C.170 and 285C.175, in accordance with OAR 123-674-5050.

(2) Property that is assessed in the county after the zone’s designation or amendment may qualify and be exempted under certain circumstances, including but not limited to the following examples, which might occur in combination:

(a) Assessment occurred while in the process of re/construction, modification or installation, and the taxpayer was not allowed to file or simply did not apply in a timely or acceptable fashion under ORS 285C.170 or 307.330 and 307.340.

(b) While an administrative or judicial appeal is pending the property is assessed.

(c) The authorized business firm misses the first-year filing deadline but receives the remaining years of the exemption as described in OAR 123-674-6100(5)(b).

(d) A building or structure acquired from an unrelated third party and authorized as described in OAR 123-674-2100(4) (provided, of course, that the building, structure, the applicable portion of it, or an improvement to it was not in use or occupancy for more than a year preceding the first year of exemption).

(e) As permitted by OAR 123-674-5200(2), property:

(A) Located elsewhere in the county was newly purchased and subsequently installed in the enterprise zone; or

(B) Was introduced to the county less than six months preceding Application, but an assessment date occurred prior to its being exempted.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.170, 285C.175, 285C.180 & 285C.220
OBDD 38-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5500 Obligations for All Leases, Lessors and Lessees

(1) Qualified property that is not owned by the authorized business firm is exempt in an enterprise zone under ORS 285C.185(3) subject to all other applicable requirements, if used, occupied or operated by the firm under a lease agreement executed no later than July 1 of the first year of exemption on the leased property under ORS 285C.175.

(2) The term of the lease must also extend until at least the end of the tax year that begins in the last exemption year, unless the qualified business firm will or does assume ownership of the property by such time. In certain cases where the term of a lease is technically too short, mitigating circumstances include but are not limited to where:

(a) The firm has the option to unilaterally renew the lease; or

(b) The firm:

(A) Retains effective prerogatives of ownership under an unconventional or nontraditional lease that serves mainly as a financial instrument; and

(B) Would have an unfettered right to retain title to the property in the event that the lease were not mutually renewed before the expected end of the exemption period.

(3) The owner of leased qualified property may be any person or corporation, including but not limited to a public body or an owner of the firm.

(4) The lease agreement must effectively operate as a net lease, inasmuch as:

(a) The firm/lessee directly pays all ad valorem taxes assessed against any qualified property covered by the lease agreement; or

(b) The firm/lessee will compensate the owner of such property in full for the property taxes in addition to rent or other costs throughout the period of the lease.

(5) The stipulation of a net lease is irrelevant if the owner and lessee have common ownership and are subject to treatment as a single eligible business firm according to OAR 123-674-0200(4).

(6) The owner of any such qualified property (even machinery & equipment) must join the firm in filing the property schedule as an attachment to the exemption claim form under ORS 285C.225(4)(d) for the first exemption year, as described in OAR 123-674-6100, such that the owner or the owner’s authorized legal agent signs one of the following:

(a) The same property schedule that has the original signature of the firm’s representative; or

(b) An attachment to the schedule that provides for equivalent acknowledgment by the owner.

(7) For purposes of this rule, a lessee that sub-leases property to the firm may substitute for the owner.

(8) The owner has the same right as the firm to timely notify the county assessor and the zone sponsor under ORS 285C.240(1) if a requirement is not met, in order to avoid penalties under ORS 285C.240(4).

(9) A copy of the lease agreement is not required with Application or with the exemption claim, except as described in OAR 123-674-2100(4) or as requested by the county assessor.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.170, 285C.175, 285C.180 & 285C.220
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-5900 Property at Time of Zone Termination

OAR 123-650-9500 to 123-650-9700 address treatment of qualified property in an enterprise zone that has terminated.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175 & 285C.245
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-674-6000 FILING & COMPLIANCE — Exemption for Property Not Yet In Service

Under ORS 285C.170 qualified property of an actively authorized business firm in the enterprise zone is exempt from ad valorem taxation for up to two years, such that:

(1) Consistent with OAR 123-674-6100(4), this exemption precedes and complements the one under ORS 285C.175, in that:

(a) It applies only to property that is not yet placed in service before the (January-1) assessment date; and

(b) The property is thus not qualified to start the three- to five-year exemption period in the present assessment year, even while the firm may have begun an exemption period on other property.

(2) This exemption is largely interchangeable with the one under ORS 307.330 and 307.340 (Commercial Facilities Under Construction) according to OAR 150-307-0430. Common elements include but are not limited to:

(a) The firm must file with the county assessor, as described in section (3) of this rule, no later than April 1 of each assessment year when the property exists in the zone/county;

(b) Any (utility) property subject to central assessment by the Department of Revenue is disallowed;

(d) The relationship to ORS 285C.175 as described in section (1) of this rule is the same in terms of the property’s being in service or not.

(3)(a) The firm shall file the latest revision of Department of Revenue Form OR-AP-CIPEZ, 150-310-021, Application for Construction-in-Process Enterprise Zone Exemption. This is required even if the firm is also filing under ORS 285C.220 and 285C.225 to claim an exemption under ORS 285C.175 pursuant to the same authorization on other qualified property already in service.

(b) An eligible business firm that instead files Form OR-AP-CACFC, 150-310-020, Application for Cancellation of Assessment on Commercial Facilities Under Construction, will receive only the treatment allowed under ORS 307.330; the firm would need to do so for situations described in section (5) of this rule.

(4) The following are exempt in the zone, although they would not be under ORS 307.330:

(a) Property at a project site where there is no construction of or additions to a building or structure;

(b) Mere modifications to a building or structure;

(c) A nonmanufacturing facility with re/construction taking less than a year’s time to complete and to put the facility in service;

(d) Additional property that is not yet placed in service, even though a portion or element of the project, facility or structure has been completed, consistent with OAR 123-674-5300(2), as addressed in subsection (3)(a) of this rule; or

(e) Machinery and equipment that will:

(A) Not be installed in or affixed to a building, structure or addition thereto; or

(B) Remain personal property after installation.

(5) Irrespective that property might qualify under ORS 285C.175, an eligible business firm may not use the exemption under ORS 285C.170 if, for example:

(a) The property had been exempted for the previous year at the same site in the zone under ORS 307.330, for whatever reason;

(b) The firm is a hotel, motel or destination resort, regardless of the zone;

(c) The firm’s Application is not yet approved—i.e., the firm is not authorized—consistent with OAR 123-674-3000 by the April-1 filing deadline in this rule; or

(d) As of the January 1 assessment date:

(A) The authorization is inactive under ORS 285C.165 unless also renewed by April 1; or

(B) The zone is terminated.

(6) Pending approval of its Application, respective to subsection (5)(c), an eligible business firm may file and have property exempted as allowed under ORS 307.330, such that:

(a) After approval/authorization, the assessor may extend exemption under ORS 285C.170 to other qualified property subject to this rule; but

(b) The ongoing exemption of the property in the next year may continue only under ORS 307.330, as applicable.

(7) The county assessor shall not exempt property specifically under ORS 285C.170, if the assessor has a reasonable and particular basis to believe that:

(a) The property is or will not be qualified property when placed in service including, for example, that the exemption would be in the third year of the first exemption under ORS 285C.175 pursuant to the (only) applicable authorization;

(b) The authorized business firm will not qualify under ORS 285C.200; or

(c) Any other applicable requirement under ORS 285C.170 or 285C.175 will not be satisfied, including but not limited to zone termination except as provided in OAR 123-650-9500(6) or 123-674-5050(3).

(8) In the face of significant doubts about conformance with provisions under ORS 285C.170, the assessor may depend on reasonably requested information or confirmation from the firm or zone sponsor, before determining to grant the exemption.

(9) Consistent with subsection (2)(c) of this rule, property exempted under ORS 285C.170 may not receive further exemption under ORS 307.330 beyond the cumulative two-year period.

(10) In the event that the anticipated exemption under ORS 285C.175 is unclaimed, denied or disqualified, the exemption as described in this rule is not necessarily jeopardized in any way, even for such property that would not normally be exempt under ORS 307.330.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.165, 285C.170, 285C.175, 285C.245 & 307.330
OBDD 39-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 20-2020, minor correction filed 09/02/2020, effective 09/02/2020
OBDD 18-2020, minor correction filed 08/31/2020, effective 08/31/2020
OBDD 17-2020, minor correction filed 08/31/2020, effective 08/31/2020
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6100 Mandatory First-year Claim with Property Schedule

For purposes of an enterprise zone exemption on qualified property under ORS 285C.175:

(1) The authorized business firm:

(a) Must file the latest revision of the following Department of Revenue forms with the county assessor under ORS 285C.220 and 285C.225 to begin the exemption period:

(A) Form OR-EZ-EXCLM, 150-310-075, Oregon Enterprise Zone Exemption Claim; and

(B) FORM OR-EZ-PS, 150-310-076, Oregon Enterprise Zone Property Schedule (as an attachment that lists and identifies the property to be exempt);

(b) May do so only after December 31 of the year, in which the re/construction, modification or installation of qualified property is completed; and

(2) The property must not have been in service at a location inside the zone before January 1 of the year directly prior to claiming the exemption as described in section (1) of this rule.

(3) Subsection (1)(b) of this rule is synonymous with qualified property having been ‘placed in service’ during that year, which:

(a) May be only a portion of the entire investment proposed with authorization; and

(b) Does not include property (even if physically operable or finished) that pending completion of the overall facility or investment is still:

(A) Incapable of effective use or occupancy due to commercial or regulatory reason consistent with OAR 123-674-5000(4); or

(B) Not yet intended for use or operation, subject to testing, shakedown or other general startup steps.

(4) Sections (1) to (3) of this rule dovetail and are mutually exclusive with criteria for exemption under ORS 285C.170, as described in OAR 123-674-6000.

(5) The filing as described in section (1) of this rule shall be due no later than the corresponding April 1, but:

(a) By June 1, the authorized business firm may submit it with a late fee under ORS 285C.220(7) or amend a timely filed property schedule form under ORS 285C.225(5); or

(b) On or before April 1 (but after January 1) of the next year, the authorized business firm may file very late under ORS 285C.220(10) without a fee to receive the remainder of an exemption minus the first year, provided the firm was in compliance with all applicable requirements in order for the exemption to have been in effect during that first year.

(6) The county assessor may deny the exemption under ORS 285C.175(6) if unable to obtain critical and reasonably requested clarification, confirmation or substantiation of information missing from or supplemental to the filed forms from the:

(a) Firm under ORS 285C.220(3); or

(b) Zone sponsor under ORS 285C.230, or as arranged with the Preauthorization Conference.

(7) The county assessor shall deny the exemption:

(a) To any authorized business firm with inactive status, as described in OAR 123-674-3700, if the filing does not include the fee under ORS 285C.165(3), which would be in addition to the fee, if any, in subsection (5)(a) of this rule.

(b) On any property that is not actually in use or occupancy between January 1 and June 30 of the first year that the exemption is claimed, notwithstanding its being in service by January 1 or even in use or occupancy during that preceding year.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.165, 285C.170, 285C.175, 285C.220, 285C.225 & 285C.230
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6200 Filing Latter-year Claims

For qualified property to continue to be exempt in an enterprise zone throughout the entire period under ORS 285C.175:

(1) The qualified business firm must file annually under ORS 285C.220:

(a) Using the latest revision of Department of Revenue Form OR-EZ-EXCLM, 150-310-075, Oregon Enterprise Zone Exemption Claim;

(b) With the county assessor and a copy to the zone sponsor;

(d) In addition to the first-year filing described in OAR 123-674-6100.

(2) The claim form also covers other property pursuant to the same authorization, consistent with OAR 123-674-3100(4), including but not limited to the attachment of another property schedule for any new, additional qualified property that is placed in service in the previous calendar year and would be exempt for its own period under ORS 285C.175(2)(a).

(3) For a claim form filed by itself for purposes of compliance in maintaining an ongoing exemption or exemptions, the assessor’s office may accept it late until August 31 under ORS 285C.220(8) but only if:

(a) Furnished to the zone sponsor, as well; and

(b) Accompanied with the progressively larger late filing fee.

(4) The assessor may henceforth deny the exemption for the remainder of the period, subject to notice under ORS 285C.175(6) without further procedure, if the claim form is not received (at the latest on August 31) or it lacks for the late filing fee.

(5) Besides arrangements from the Preauthorization Conference, the zone sponsor and the county assessor shall consider and rely on the duties and options under ORS 285C.230, as well as exercise the procedure under ORS 285C.235 to demand corroborating evidence of the firm by time/receipt-verified mail whenever warranted, which:

(a) Would be the only recourse if the firm refuses to submit a claim form after the final year of exemption;

(b) Is always available if the submitted information and the compliance of the firm with employment/other requirements is suspect; and

(A) Automatically, if the firm does not satisfactorily respond within 60 days, but without extra penalty; or

(B) With the 20-percent penalty on back taxes under ORS 285C.240(4), in the event that any provided evidence shows that the qualified business was required to have given notice under ORS 285C.240(1).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175, 285C.220, 285C.225, 285C.230, 285C.235 & 285C.240
OBDD 40-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6300 Disqualification of Particular Property

A qualified business firm does not lose its ongoing enterprise zone exemption under ORS 285C.175 on all qualified property if only certain property fails to satisfy a relevant requirement:

(1) Disqualification (including back taxes) shall ensue under ORS 285C.240 only on such property, and the one-year payback of tax savings under ORS 285C.240(6) does not apply

(2) Such disqualification pertains when the exempt property no longer satisfies a relevant criterion under ORS 285C.175, 285C.180, 285C.185 or 285C.190, including but not limited to property during an exemption year that is:

(a) Removed from the enterprise zone;

(b) Sold, exchanged or leased to another business firm, except as described in OAR 123-674-4800;

(d) Not actually in use or occupancy (notwithstanding its being in service) for at least 180 consecutive days concluding in the preceding exemption year.

(3) In order for the qualified business firm to avoid the 20-percent penalty on the back taxes associated with such property-specific disqualification, notice under ORS 285C.240(1)(a), (e) or (f) is due by July 1 after the year in which failure occurred. The owner of leased, exempt property may give such notice, and the firm may do so through a timely exemption claim as described in OAR 123-674-6200.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175, 285C.220, 285C.225, 285C.230, 285C.235 & 285C.240
OBDD 41-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6400 Temporary rule language in effect until 12/01/2026. General Firm Disqualification

(1) Loss of exemption under ORS 285C.175 applies to all qualified property of a business firm that is exempt in the year when an event occurs, for which notice is due under ORS 285C.240(b), (c) or (d), including but not limited to:

(a) Substantial curtailment, consistent with OAR 123-674-4600;

(b) Failure to satisfy an applicable local additional requirement, according to OAR 123-668-2000 to 123-668-2500, and pursuant to written notification to the assessor from the zone sponsor in the absence of notice by the firm under ORS 285C.240(1)(d);

(d) Not meeting applicable criteria in OAR 123-674-4300 for purposes of a zone sponsor’s waiver;

(e) What is described in OAR 123-674-0500(2) for the requirements specific to an extended abatement;

(f) Failure to satisfy requirements included in a written agreement establishing flexible hiring timelines according to OAR 123-674-0400 and consistent with ORS 285C.200(2); or

(g) Failure to satisfy requirements included in a written agreement establishing alternative performance criteria according to OAR 123-674-0300 and consistent with ORS 285C.200(2).

(2) If an event occurs relative to section (1) of this rule, then the qualified business firm shall notify both the local zone manager and the county assessor in writing at the latest by July 1 of the following year, which may also be done:

(a) Through timely filing of the exemption claim in OAR 123-674-6200 that discloses the event.

(b) By the owner of any qualified property that the qualified business firm leases.

(3) Notice as described in section (2) of this rule shall result in either:

(a) The firm reimbursing the enterprise zone sponsor for an amount equal to all associated property taxes abated in that exemption year, as described in OAR 123-674-6600 to 123-674-6630; or

(b) The county assessor’s disqualifying the firm under ORS 285C.240, including loss of future years of the exemption and retroactive payment of applicable back taxes with the next tax bill.

(4) If the assessor or zone sponsor discovers a failure, for which there was not timely notice as described in section (2) of this rule, then subsection (3)(a) of this rule is inapplicable, and disqualification as described in subsection (3)(b) of this rule shall include the 20-percent penalty or surcharge on back taxes.

(5) Disqualification for purposes of this rule does not affect property covered by any other Application, for which the particular requirements are still satisfied, consistent with OAR 123-674-3500, except under ORS 285C.245(7) for another Application made after the zone terminated as described in OAR 123-650-9600, in which case the other such Application is nullified, and associated property, also disqualified.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.200, 285C.220, 285C.225, 285C.230, 285C.235 & 285C.240
OBDD 10-2026, temporary amend filed 06/05/2026, effective 06/05/2026 through 12/01/2026
OBDD 42-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6600 PAYBACK IN LIEU OF DISQUALIFICATION — Applicability

For purposes of ORS 285C.240(6) and OAR 123-674-6600 to 123-674-6630, a qualified business firm’s avoidance of disqualification through payment to the zone sponsor of the firm’s tax savings for one year is allowed, only if:

(1) The firm fails to meet an employment, compensation, waiver, locally established condition or other requirement under ORS 285C.240(1)(b), (c) or (d), and not for any requirement pertaining to particular qualified property in OAR 123-674-6300 or to the firm’s eligibility under ORS 285C.135;

(2) The firm provides written notice under ORS 285C.240 to the zone sponsor or the county assessor by not later than July 1 of the year following the year that failure as described in section (1) of this rule occurred consistent with OAR 123-674-6400(2);

(3) The firm maintains the business operations pertaining to the qualified property, unless the firm can demonstrate that any discontinuation (shutdown) is only temporary;

(4) The firm has not previously used ORS 285C.240(6) for any failure covered by section (1) of this rule to avoid disqualification of the same exemption, respective to property actually first qualifying in the same year, but not in other years even if covered by the same authorization and no longer exempt; and

(5) The firm provides written proof to the county assessor that it has made a nonrefundable payment of the full amount of the preceding year’s tax savings to the zone sponsor, not later than August 31 of the year following:

(a) The exemption year in which the failure occurred; or

(b) The fourth year of exemption, in the case of failure to meet a requirement for an additional two years of exemption under ORS 285C.160, during (only) one of the first four exemption years.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.240
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6610 Payment of Tax Savings

For purposes of the payment by a qualified business firm described in OAR 123-674-6600(5):

(1) The firm shall pay to the sponsor of the enterprise zone an amount equal to the additional taxes due, as the county assessor computed under ORS 285C.175(7), on all of the qualified property receiving the exemption.

(2) The sponsor of the enterprise zone is responsible for enabling the firm to make the payment, by doing the following in a timely manner:

(a) Issuing an invoice for such payment to the firm (as necessary);

(b) Receiving such moneys; and

(3) In collecting, invoicing, holding or spending any money paid by the firm, the zone sponsor shall establish the necessary accounts, special funds, procedures or documentation in accordance with ORS chapter 294 and applicable local laws.

(4) If the county assessor does not receive proof that sufficient and timely payment has been made by the firm, the assessor shall disqualify the exemption or exemptions covered by the requirement consistent with OAR 123-674-6400(3)(b).

(5) If the assessor later disqualifies the firm respective to the same exemption, the assessor shall reduce the back taxes by any amount previously paid in accordance with this rule.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.240
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6620 Distribution of Payment among Cosponsors

In the case of an enterprise zone sponsor comprising two or more city or county governments or port districts:

(1) Any cosponsor may act as the initial depository for collecting the qualified business firm’s payment as described in OAR 123-674-6610 and providing the firm with the requisite proof of payment, but at least one cosponsor must do so.

(2) The cosponsors may create joint mechanisms and arrangements to receive, hold or use such payments.

(3) The cosponsors may distribute the amount of any such payment among themselves through any mutually agreed method or formula, including but not limited to proportional receipt only by cosponsors that levy taxes where the property is located.

(4) If distribution does not happen within six months of receipt of payment, unless pending a joint effort among the cosponsors as described in OAR 123-674-6630, the government or entity holding the funds shall distribute the full amount in equal portions to each city, port or county government that sponsors the zone without assessing any administrative fee. If more than one county sponsors the zone, then the cosponsors in the county containing the qualified property shall receive and divide among themselves not less than half of the total payment.

(5) There is no obligation to maintain or repeat for future payments any of the sponsor’s elections and methods utilized in accordance with this rule for a given payment.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.240
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6630 Utilization of Payments

In accordance with ORS 285C.240(6)(b), the expenditure of moneys collected from a qualified business firm shall benefit residents of the enterprise zone and its immediate vicinity, such that:

(1) For a rural zone, the immediate vicinity will generally encompass (but is not necessarily limited to) the entire incorporated and urban growth area of any city sponsoring the zone, unless the city is relatively large, and only some parts of the zone boundary are in or near the city.

(2) Public, public/private or community-based activities, efforts or programs that acceptably serve residents of the zone and its local area include but are not limited to:

(a) Job training, placement, skill development, career counseling and similar programs predominately involving such residents;

(b) Better educational opportunities, facilities and so forth that serve such residents;

(c) Planning, analyses or support for infrastructure, public safety or other public/community services or facilities that have the potential to stimulate commerce and employment growth in association with the zone;

(d) Programs that assist with financing or other matters for businesses largely started by or employing such residents;

(e) Improvements to environmental conditions, recreational resources or other qualities of the community; or

(f) Reasonable contributions to the management, marketing or other needs of the enterprise zone itself.

(3) Combining these moneys with funds obtained from authorization filing fees or from other resources associated with the enterprise zone (see OAR 123-668), or otherwise belonging to the local community is allowable.

(4) If the payment per cosponsor is less than $5,000, the zone sponsor may:

(a) Delay spending the moneys for an indefinite period of time, pending complementary opportunities or resources; and

(b) Allocate the moneys to existing programs and projects that are likely to benefit such residents, even if not exclusively.

(5) If the payment per cosponsor is between $5,000 and $25,000, the zone sponsor may:

(a) Postpone spending the moneys for up to two years; and

(b) Allocate the moneys to existing programs and projects, but the sponsor shall make reasonable efforts to ensure that relevant residents in particular are beneficiaries of additional expenditures.

(6) If the payment per cosponsor exceeds $25,000, the zone sponsor shall see that the moneys go to ongoing programs, special projects and so forth, but only if such expenditures have a direct and particular impact on relevant residents.

(7) There is no obligation to maintain or repeat for future payments any of the elections and methods utilized in accordance with this rule for a given payment.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.240
OBDD 43-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6880 Deferral during Recession

For purposes of ORS 285C.203 to defer the standard enterprise zone exemption, during which time the exemption is suspended and an authorized or qualified business firm pays taxes on qualified property:

(1) The firm may avoid denial or disqualification for substantial curtailment or other noncompliance (see OAR 123-674-4100, 123-674-4600, 123-674-6100 and 123-674-6400).

(2) The total cost of the investment, consistent with OAR 123-674-4300(5)(a) and (b), must equal or exceed the applicable amount under ORS 285C.203(1)(a)(B).

(3) If electing to do so, the zone sponsor needs to take preliminary action to grant the deferral, such as a formal notification from the local zone manager to the firm, that pending the resolution(s) in section (5) of this rule, declares:

(a) Whether the exemption would be suspended for one year or two consecutive years; and

(b) The minimum level of employment of the firm, which may even be less than Existing Employment (but must be more than zero), that is to be maintained during:

(A) The suspension period; and

(B) The exemption period remaining post‑suspension, if allowed as such by the sponsor.

(4) Notice in section (3) of this rule may occur only at such a time when, as determined by the Department using the most recent data from Current Employment Estimates (CES) and Local Area Unemployment Statistics (LAUS), over at least two successive calendar quarters during the prior 12 months:

(a) Seasonally adjusted state employment shrank; and

(b) The unemployment rate of the county containing the property was two percentage points greater than the state’s rate, as averaged for the quarter.

(5) No later than 60 days after notification in section (3) of this rule or August 31 of the first year of suspension, whichever is earlier, the zone sponsor shall adopt resolution(s) confirming the action and declarations in section (3) of this rule.

(6) In each year of the suspension period, the firm shall file an exemption claim under ORS 285C.220, and might even meet normal requirements, but regardless, the county assessor shall in effect deny the exemption under ORS 285C.175 (without necessarily giving notice) and all qualified property covered by the authorization is subject to normal taxation for that year.

(7) At the conclusion of the suspension period, the firm shall reclaim and resume the remainder of exemption under ORS 285C.175 on any qualified property, but the firm and property are subject to disqualification under ORS 285C.240, including but not limited to repayment of property taxes from any year of exemption before the suspension period, if:

(a) The sponsor amends or repeals its resolution in section (5) of this rule to revoke the suspension before July 1 following the suspension period;

(b) During the suspension period, or before April 1 of the first year of the resumed exemption period, employment of the firm does not meet the minimum level set by the resolution, or as otherwise required under ORS 285C.200(1)(c); or

(c) The firm fails to maintain the minimum level set by the resolution if so allowed; its operations are otherwise subject (again) to substantial curtailment under ORS 285C.210, or it fails to meet any other applicable requirement to remain qualified.

(8) In the case of an exemption already approved and received, the one-year payment in lieu of disqualification under ORS 285C.240(6) may occur with respect to a year before or after the suspension period as described in this rule (see OAR 123-674-6600 to 123-674-6630).

(9) The year(s) of noncompliance and of suspension shall correspond, but their exact relationship is subject to the determination of the local zone sponsor in consultation with the county assessor, preferably in preparing the resolution.

(10) The sponsor may:

(a) Modify the resolution on or before the next August 31 to retract or insert the second consecutive year of suspension.

(b) Grant two one-year suspensions, if separately done in complete conformance with sections (3) and (5) of this rule.

(11) The local zone manager shall forward to the county assessor by August 31 of the tax year a copy of any resolution granting the suspension of exemption or of any amendment or revocation of such a resolution.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.203
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-6885 Additional Conditions with Deferral

In order for an authorized or qualified business firm to have its exemption under ORS 285C.175 suspended and then resume according to OAR 123-674-6880, though not directly provided under ORS 285C.203, a zone sponsor might impose conditions on the firm according to OAR 123-668-2000(2)(d):

(1) As specified in the resolution(s) granting the suspension in terms of the obligations on the firm and respective contingencies.

(2) That are enforced primarily through the sponsor’s revocation of the suspension or decisions described in OAR 123-674-6880(10).

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.105(1)(i), 285C.203, 285C.225(1), 285C.230(2), 285C.235(2) & 285C.240(1)
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 8-2020, adopt filed 08/12/2020, effective 08/12/2020

Or. Admin. R. 123-674-7200 GENERAL LAWFULNESS — Terminology

For purposes of OAR 123-674-7200 to 123-674-7250, with respect to an eligible business firm compliance with other laws under ORS 285C.200(1)(f):

(1) Determination means either of the following:

(a) A rightfully available written admission by the firm of a Noncompliance; or

(b) The issuance of an order, ruling or similar action by a duly empowered court, regulatory authority or similar entity that is:

(A) An official finding of Noncompliance that has the force of law under the jurisdiction of the court, regulatory authority or similar entity; and

(B) The final action by the particular regulatory or judicial process, even if prior to potential appeals.

(2) Event of Noncompliance means a Determination corresponding to an Illegal Act, for which the underlying Noncompliance is both:

(a) Material, as described in OAR 123-674-7230; and

(b) Not cured in accordance with OAR 123-674-7240.

(3) Illegal Act means an action, omission, chain of occurrences or similar failings by the firm or by an officer or agent in the conduct of the firm’s operations and activities, effectively occurring after the Application but before January 1 of the last year of exemption, that cause the Noncompliance corresponding to the relevant Determination. (An Illegal Act may also result from Noncompliance with a Determination related to an earlier act)

(4) Noncompliance means a violation of a law, as enacted by one of the following, or the violation of any of the rules or regulations duly promulgated under such law:

(a) The United States Congress;

(b) The Oregon Legislative Assembly; or

(5) Substantial Falsification means that information in an enterprise zone form, filing or associated documentation by the firm, subject to declaration under penalties of false swearing, does one or both of the following:

(a) Misreports or omits required information, such that the enterprise zone exemption would have been denied or disqualified had the information been correctly or completely reported, which by itself shall be considered an Illegal Act in addition to any penalties resulting from false swearing under ORS 305.990; or

(b) Contradicts OAR 123-674-7210(1), in that at the time of the relevant declaration, the firm failed to disclose an Illegal Act, of which it should reasonably have been aware, including but not limited to one that is pending a Determination at the time of authorization.

History

Statutory/Other Authority: 285C.060(1), 285C.200(7) & ORS 285A.075
Statutes/Other Implemented: ORS 285C.200
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7210 Declarations and Responsibilities

(1) Any Department of Revenue form for an enterprise zone tax abatement shall also have the firm declare that it is in compliance with applicable laws described in OAR 123-674-7200(4), as part of the declaration made under penalties of false swearing (as to the truth and correctness of the form or document under ORS 305.810 and 305.815).

(2) Without clear evidence of a Determination:

(a) The county assessor is under no obligation to undertake any effort for purposes of ORS 285C.200(1)(f); and

(b) The exemption on qualified property of an otherwise qualified business firm is unaffected.

(3) Regardless of expertise or jurisdiction, any entity or person may present evidence of a Determination to the county assessor.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.200(7)
Statutes/Other Implemented: ORS 285C.125 & 285C.200
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7220 Effect of Event of Noncompliance

Upon an Event of Noncompliance:

(1) In the case where an authorized business firm is not yet qualified, the county assessor shall deny exemption under ORS 285C.170 or 285C.175.

(2) In the case where the firm is receiving or has received the exemption, the Event of Noncompliance shall cause retroactive disqualification (see OAR 123-674-6400).

(3) In response to or in anticipation of such denial or disqualification, the assessor shall give notice that:

(a) Is sent to the firm and is copied to the zone sponsor, the Department of Revenue and the Department;

(b) Provides the firm with an explanation of the action and includes copies or descriptions of the evidence for the Determination; and

(c) Explains how the firm may appeal the action, anticipated action or tax collections to the Tax Court under ORS 305.404 to 305.560, for which the firm’s right to directly do so is in no way infringed by this or any administrative rule or prevented under ORS 285C.200(7).

(4) The county assessor may reverse a decision or action in section (1) or (2) of this rule, for reconsideration of an issue listed in OAR 123-674-7250(1) or a successful appeal that negates the Determination. As necessary to effect a reversal for this section, the assessor may reinstate the exemption and refund taxes paid on qualified property to the firm consistent with provisions of ORS Chapter 311.

(5) If the Determination is appealed by the business firm through administrative or judicial channels under the law in question, then the assessor may indefinitely suspend disqualification in section (2) of this rule, such that:

(a) If the business firm prevails in the appeal, then the exemption is unaffected; or

(b) If the business exhausts, withdraws or effectively fails in its pursuit of such appeal, then the action takes effect. In such a case, the assessor may add interest to any back taxes during the intervening period for the appeals process, until the next general property tax roll, consistent with provisions of ORS Chapter 311.

(6) In addition, if the firm is taking good faith actions to fully cure the Noncompliance in accordance with OAR 123-674-7240, the firm may make a one-year (nonrefundable) payment in lieu of disqualification in section (2) of this rule, as described in OAR 123-674-6600 to 123-674-6630, while the effectiveness of such cure is still pending.

History

Statutory/Other Authority: 285C.060(1), ORS 285A.075 & 285C.200(7)
Statutes/Other Implemented: ORS 285C.125 & 285C.200
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7230 Materiality

An eligible business firm’s Noncompliance is material for purposes of ORS 285C.200(1)(f), only if all of the following are true:

(1) Zone-Applicable . It is related to or part of actual operations of and by the business firm within the enterprise zone boundary, including firm-wide activities that actually influence affairs in the zone, as well as elsewhere that the firm operates, such that:

(a) The Illegal Act(s) might still occur outside the zone and be material if derivable from or directly beneficial to operations of the firm in the zone; but

(b) Even if the Determination circumstantially indicates illicit intent by firm personnel or decisions, it is still immaterial, if lacking evident effect on tangible activities or behavior at zone locations.

(2) Significant . It has or could conceivably harm, threaten, disrupt or undermine any of the following: An individual person, fair and honest commerce, government revenue collection, others’ property rights, environmental protection, public health and safety, the general welfare and so forth, in contrast to a Noncompliance that results only in inconveniences ( e.g. , parking violations), aesthetical problems ( e.g. , poor landscape maintenance), etc .

(3) Substantive . It relates to the actual behavior or effects that the law in question is intended to control or prevent, as opposed to failings or missteps in terms of procedural matters, data reporting or similar technicalities, unless such failings or missteps exhibit willfulness, perniciousness or a history of repetition.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.200(7)
Statutes/Other Implemented: ORS 285C.200
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7240 Cure

As a consequence of actions taken by an eligible business firm in response to a Determination, it may still comply with the law and, in effect, cure the Noncompliance for purposes of ORS 285C.200(1)(f), such that:

(1) A Noncompliance is not curable if, in the presence of clear and convincing evidence, the Illegal Act in question is:

(a) Heinous, reckless or knowingly perpetrated or allowed to happen as a matter of firm policy; or

(b) Committed within five years of a previous determination relating to the same or similar violation of the law, regardless if the prior violation occurred:

(A) Before authorization;

(B) At a location outside the enterprise zone; or

(2) A Noncompliance is also incurable if the total monetary penalty as described in subsection (3)(a) of this rule exceeds a level publicly declared for purposes of this rule and established by the zone sponsor before the Determination became final. According to stipulations in the sponsor’s declaration, this level or levels shall be equal to or greater than:

(a) For a fine or fines levied by a regulatory agency under a single citation or for closely related violations, $1,000,000; and

(b) Overall, including but not limited to court-imposed damages, $5,000,000.

(3) A Noncompliance, except as precluded by section (1) or (2) of this rule, may be cured insofar as the firm fully and clearly documents or demonstrates for the county assessor that:

(a) All fines, damages and so forth arising from the Determination have been paid in full, according to the final regulatory or judicial assessment imposed;

(b) The firm promptly submitted to and fulfilled all other applicable penalties and has taken or has demonstrable plans to take all other actions, as required by the court, regulatory authority or similar entity;

(c) The circumstances that led to the Noncompliance have been eliminated and resolved, such that further Noncompliance by the firm of a comparable or more serious nature is not expected to occur; and

(d) It or associated entities have undertaken reasonable efforts to compensate other substantially harmed parties uninvolved with any court action.

(4) The decision to consider a Noncompliance cured shall be conclusive and not subject to ongoing efforts by the firm or continual verification.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.200(7)
Statutes/Other Implemented: ORS 285C.200
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7250 Interpretation

With respect to the interpretation of OAR 123-674-7200 to 123-674-7250 for purposes of ORS 285C.200(1)(f):

(1) There are five primary issues related to the conclusion that there is an Event of Noncompliance:

(a) Is there a Determination as defined?

(b) Did the Illegal Act occur as defined? ..., after Application?

(d) Is the Noncompliance curable ..., and if so, has it been cured?; or

(e) Has there been Substantial Falsification, and what are the implications of it?

(2) In deciding whether there is an Event of Noncompliance, the county assessor may do as follows at the assessor’s initiative or in response to issues raised by a business firm’s response to notice in OAR 123-674-7220(3):

(a) The assessor may submit the question at issue to the sponsor of the enterprise zone whether through the local zone manager or otherwise, such that:

(A) The submission is made in writing with a summary of the matter and copies sent to the affected business firm, the Department of Revenue and the Department; and

(B) The assessor may consider a written decision from the zone sponsor only within a prescribed period not exceeding 60 days after the submission.

(b) Either in lieu of or subsequent to the request of the zone sponsor, the assessor may submit the question or questions to the Director, such that:

(A) The submission is in writing with a summary of the matter, and the affected business firm, the Department of Revenue and the zone sponsor receive copies;

(B) The assessor certifies whether a conclusive response by the Director shall bind the assessor’s action in OAR 123-674-7220;

(C) The Director may request additional information from the assessor, the firm, the sponsor, the Department of Revenue or the Department of Justice; and

(D) The Director shall respond in writing to the question or questions submitted by the assessor, who shall treat it as official state interpretation of this division of administrative rules.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.200(7)
Statutes/Other Implemented: ORS 285C.200
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-674-7700 FIRST SOURCE HIRING AGREEMENTS — Coverage

For purposes of an authorized or qualified business firm’s entering into a First Source Hiring Agreement in an enterprise zone:

(1) Contact agency means the entity that represents publicly funded job training providers, consistent with OAR 123-070, which is exclusively the local office of Worksource Oregon (State Employment Department).

(2) The agreement shall apply to all of the firm’s sites of operation within the enterprise zone but only for that zone, except for job openings that do not matter directly under ORS 285C.050 and 285C.200 (see OAR 123-674-0200).

(3) Whenever the firm intends to fill a job opening with someone, who in a voluntary, temporary, part-time or other capacity, has been working at the business or job site for at least 30 days prior to closure date of the job opening:

(a) The firm must indicate this situation and include the name of the prospective hire in its notification to the contact agency.

(b) With receipt of such notification, the contact agency is in no way obligated to send job applicants.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.215(3)
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.200 & 285C.215
OBDD 7-2017, amend filed 11/29/2017, effective 11/29/2017
Renumbered from 123-070-2100 by OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Or. Admin. R. 123-674-7710 First-Source Procedures

(1) A Firm/applicant shall enter into an agreement as described in OAR 123-070 either:

(a) After the local zone manager approves the application for authorization as provided in 123-674-2300(8)(d);

(b) Before hiring new employees to qualify under ORS 285C.200; or

(2) The local zone manager shall:

(a) Advise every Firm/applicant to promptly seek such an agreement;

(b) Notify the contact agency about the Application and about how to contact the business firm; and

(c) See that the contact agency receives a copy of the completed Approval Form and Application consistent with OAR 123-674-2500(5)(b).

(3) Upon learning of the Firm/applicant, the contact agency shall arrange an opportunity for it to timely execute an agreement. A Firm/applicant has the right to initiate such contact and to enter promptly into an agreement.

(4) The contact agency shall:

(a) Provide a copy of each executed agreement to the respective local zone manager within 10 business days of entering into it with a Firm/Applicant; or

(b) Notify the local zone manager of any problem that arises in association with executing it.

(5) The local zone manager shall:

(a) See that each authorized business firm has entered into a timely, valid and accurate agreement, in accordance with OAR 123-070;

(b) Inform the county assessor under ORS 285C.215(2)(a) of any such firm that might have failed to enter into such an agreement; and

(c) Instruct business firms of their obligations under the agreement, as appropriate or necessary, including but not limited to requests by the contact agency or any publicly funded job training provider.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.215(3)
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.200 & 285C.215
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
Renumbered from 123-070-2200 by OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00, Renumbered from 123-070-0370
EDD 1-1996, f. 2-28-96, cert. ef. 3-1-96
Reverted to EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 3-1992(Temp), f. 3-12-92, cert. ef. 3-13-92
Reverted to EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 22-1990(Temp), f. & cert. ef. 8-9-90
EDD 8-1990, f. 4-13-90, cert. ef. 4-14-90
EDD 7-1989(Temp), f. & cert. ef. 10-17-89

Or. Admin. R. 123-674-7720 Handling Exemption Claims

For purposes of the First Source Hiring Agreement and the county assessor’s processing of an initial exemption claim with property schedule as described in OAR 123-674-6100, except in the case of a general waiver under ORS 285C.215(3) (see OAR 123-070):

(1) An authorized business firm may attach a copy of the agreement to the claim form.

(2) For purposes of ORS 285C.175(1)(c), the assessor shall rely principally on the zone sponsor and contact agency to inform the assessor’s office under ORS 285C.215(2) if a requisite agreement is lacking.

(3) To verify the existence, effectiveness or general suitability of the agreement, the assessor may do the following:

(a) Request and receive an agreement copy from the local zone manager, contact agency or Firm/applicant; or

(b) Seek assistance under ORS 285C.230(1)(b) before approving the exemption claim, as a mandatory duty of the zone sponsor.

(4) If learning of a problem with execution of a suitable agreement by the Firm/applicant, then pending a corrective waiver by the Director, the county assessor:

(a) May deny the exemption claim, if the agreement was not executed as described in OAR 123-674-7710.

(b) Shall deny the exemption claim, if the agreement was not executed on or before December 31 directly preceding the first exemption year under ORS 285C.175, does not cover at least all years of exemption, or is otherwise deficient.

(5) The assessor shall deny the exemption under ORS 285C.175(6), if by August 31 of the first tax year of exemption, a problem as described in subsection (4) of this rule is not resolved through copies/documentation of the following:

(a) A (revised/replacement) agreement;

(b) Applicable waiver as allowed in OAR 123-070 or 123-674-7730; or

(6) Once a business firm is qualified and approved to receive the exemption, the exemption is not subject to later revocation or disqualification for lack of an agreement, except for the case of fraudulent representations.

(7) Subject to requisite resolution of the outstanding problem, the assessor may reverse a denial as described in section (5) of this rule and grant the exemption, as otherwise allowed under the laws and rules governing the procedures and authority of the assessor.

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.215(3)
Statutes/Other Implemented: ORS 285C.060, 285C.105, 285C.175, 285C.215, 285C.220 & 285C.240
Renumbered from 123-070-2300 by OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Or. Admin. R. 123-674-7730 Allowing Late Execution of First-Source Agreement

For purposes of an authorized business firm’s needing to have entered into a First Source Hiring Agreement:

(1) The Director may issue a waiver that excuses the requirement until the time when the agreement is actually executed or takes effect, such that the firm is not required to have been entered into the agreement:

(a) At the time of applicable hiring; or

(b) On or before December 31 of the year when qualified property is placed in service, directly before the first exemption year, as otherwise required under ORS 285C.215(1).

(2) The Director may issue waiver as described in section (1) of this rule for the following reasons:

(a) The Firm/applicant was using first-source services in a timely fashion, without having a formal agreement;

(b) Mistaken communications, an absence of local contacts or the like hampered the ability or understanding of the Firm/applicant as to the agreement or the need to enter into it;

(c) The Firm/applicant made a good faith effort to obtain an agreement, but it was misled or otherwise unable to readily obtain it through no fault of its own; or

(d) Similar circumstances.

(3) The local zone manager, county assessor or contact agency on behalf of the authorized business firm or the firm itself may seek a waiver under this rule by contacting the Department after authorization, whether before or after an action by the county assessor as described in OAR 123-674-7720.

(4) A waiver under this rule shall take the form of a written recommendation from staff to the Director that the Director approves. The written recommendation shall describe:

(a) The justification for the waiver pursuant to this rule;

(b) The basis or source of evidence for such justification or determinations, including but not limited to verbal communications with the contact agency, the county assessor or other local parties;

(d) The date by which the agreement must be in effect.

(5) The Department shall provide notice of the Director’s decision and distribute copies of any approved waiver, as well as any waiver as described in OAR 123-070 affecting an enterprise zone exemption, to the:

(a) Firm/applicant;

(b) County assessor;

(d) Local zone manager; and

(e) Department of Revenue (Attention: Exemptions Specialist, Property Tax Division).

History

Statutory/Other Authority: ORS 285A.075, 285C.060(1) & 285C.215(3)
Statutes/Other Implemented: ORS 285C.050, 285C.060, 285C.200 & 285C.215
Renumbered from 123-070-2400 by OBDD 31-2010, f. 6-30-10, cert. ef. 7-1-10
EDD 26-2009, f. 11-30-09, cert. ef. 12-1-09
EDD 1-2005, f. & cert. ef. 2-25-05
EDD 3-2000, f. & cert. ef. 2-1-00

Division 680 RURAL RENEWABLE ENERGY DEVELOPMENT ZONES

Or. Admin. R. 123-680-0001 Purpose and Scope

This division of administrative rules specifies matters related to the creation and operation of an RREDZ , which as used in these administrative rules, means a rural renewable energy development zone under ORS 285C.350 to 285C.370:

(1) The primary purpose of RREDZs is the extension only of the standard enterprise zone incentive to renewable energy projects, especially those that are far-flung or widely dispersed, in lieu of potentially infeasible or physically complex amendment to the boundary of an existing enterprise zone.

(2) These administrative rules:

(a) Have no bearing on true enterprise zones, including but not limited to such a zone’s designation and so forth, or to an eligible business firm or qualified property in such a zone, even if encompassed by an RREDZ;

(b) Do not control or bind the county assessor or Department of Revenue, and they are superseded by OAR chapter 150 in matters related to tax administration; and

(3) The sponsor of the RREDZ is equivalently responsible for the same duties as a local enterprise zone sponsor, including but not limited to those covered in OAR 123-668.

(4) For an eligible business firm in an RREDZ, the standard (3 to 5-year) enterprise zone exemption and associated provisions under ORS 285C.050 to 285C.250 apply as they would inside an enterprise zone, as addressed in OAR 123-674, but only insofar as the firm and the firm’s qualified property relate to “renewable energy” facilities and activities under ORS 285C.350, such that for purposes of the first clause of ORS 285C.350(2):

(a) The qualified property must generate electricity to a significant degree from the combustion, harnessing or utilization of a renewable energy resource, but it may also produce (even for the most part) other energy forms, including but not limited to steam, heat or mechanical power; and

(b) Definitions in OAR 330-090-0110 shall be relied on as appropriate and necessary.

History

Statutory/Other Authority: ORS 285A.075 & 285C.370
Statutes/Other Implemented: ORS 285C.350 – 285C.370
OBDD 11-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 5-2021, minor correction filed 04/06/2021, effective 04/06/2021
OBDD 7-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 6-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 12-2015, f. & cert. ef. 10-5-15
OBDD 28-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-680-1000 Basic Points about RREDZs

(1) An RREDZ terminates:

(a) By operation of law or early under ORS 285C.245(1)(a) or (b), with equivalent protection and allowances for relevant business firms in the RREDZ as described in OAR 123-650-9100 to 123-650-9700; but

(b) Not by programmatic sunset under ORS 285C.245(1)(c) or 285C.255.

(2) An RREDZ (irrespective of OAR 123-650-1000) covers the entire territory of the designated:

(a) City including subsequent annexations; or

(b) County or counties whether outside corporate limits or not but excluding any area inside an urban growth boundary (UGB) described in section (3) of this rule.

(3) An RREDZ is permitted anywhere in this state, except within the UGB of a city with a population of 30,000 or more, according to the most recent decennial U.S. Census count, including but not limited to the entire (Portland-area) Metro UGB.

(4) RREDZs come in one of only the following three types:

(a) City RREDZ, in that the governing body of a single city applies to the Department for designation, and the city is the sponsor of the RREDZ;

(b) County RREDZ, in that the governing body of a single county applies to the Department for designation, and the county is the sponsor of the RREDZ; or

(c) Multi-county RREDZ, in that each governing body of two or more counties jointly apply to the Department for designation, for which:

(A) The counties are contiguous one to another, but do not necessarily all share a single common border in the case of three or more counties; and

(B) Only one of the counties serves as the zone sponsor.

(5) In appointing the local RREDZ manager, the sponsor is encouraged to select someone who also serves as the local zone manager for an enterprise zone whenever possible.

(6) There is no particular limit on the number of RREDZs statewide, although a city or county may not have two or more concurrent designations, with the following distinctions:

(a) A city may have a designation, even if inside a county designated as an RREDZ; or

(b) A county may itself be designated an RREDZ and be part of an RREDZ with one or more other counties, but it may not concurrently belong to two or more different, multi-county RREDZs.

(7) The RREDZ exemption under ORS 285C.362 on the qualified property of a qualified business firm may not be derived from more than one overlapping RREDZ designation, except if there are two or more authorizations covering different property.

History

Statutory/Other Authority: ORS 285A.075 & 285C.370
Statutes/Other Implemented: ORS 285C.350 – 285C.370
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 7-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 12-2015, f. & cert. ef. 10-5-15
OBDD 28-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-680-1200 Designation of a RRED Zone

(1) To apply for designation of an RREDZ under ORS 285C.353, the city, county or multiple counties shall furnish the Department with:

(a) A copy of the resolution(s) requesting designation duly adopted by each jurisdiction within the past six months, which among other things, would specify the designation’s exemption limitation amount under ORS 285C.353(4) as described OAR 123-680-1400;

(b) Evidence of timely notice and communication with local taxing districts consistent with OAR 123-650-5500; and

(A) The county that will serve as the sponsor in the case of a multi-county RREDZ; and

(B) The status of any previous or otherwise ongoing RREDZ designation in the jurisdiction(s), including but not limited to the unused portion of an exemption limitation for purposes of section (4) of this rule.

(2) Subject to the accuracy and completeness of the furnished materials and any other information as the Department may request, as well as applicable laws and these administrative rules:

(a) The Director will approve designation of the requested RREDZ; and

(b) The Department shall issue documentation of the designation, including but not limited to establishing its:

(A) Effective date, which may be as early as when the zone sponsor adopted its resolution in the case of a new RREDZ especially if requested by the applicant; and

(B) Exemption limitation amount.

(3) Early termination of the RREDZ under ORS 285C.245(1)(b) and (2) or (3) shall occur only if the Director issues an order to that effect, such that with a multi-county RREDZ, all of the counties must adopt a resolution requesting termination under ORS 285C.245(3) not only the sponsor. The Director shall not approve any RREDZ that corresponds to one so terminated for the next 10 years.

(4) If the application is for a subsequent additional designation corresponding to an existing RREDZ under ORS 285C.353(4)(b) and (c), then the existing RREDZ ceases, and the new designation replaces it, effective on January 1 directly following the last date on which a resolution of application was adopted, so that:

(a) Any authorized business firm in the previously existing RREDZ belongs to the newly designated RREDZ for the initial qualification of any property first placed in service in an assessment year immediately preceding that January-1 date (regardless of the application of authorization’s date of submission or approval); and

(b) Any unused portion of the previous RREDZ’s exemption limitation under ORS 285C.353(4) ceases to exist, and only the new RREDZ’s exemption limitation, consistent with OAR 123-680-1400(3)(c), is available for future exemptions.

(5) An RREDZ may set a support fee rate with a school district under ORS 285C.160 and 285C.162 as described in OAR 123-668-4000.

History

Statutory/Other Authority: ORS 285A.075 & 285C.370
Statutes/Other Implemented: ORS 285C.350 – 285C.370
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 12-2015, f. & cert. ef. 10-5-15
OBDD 28-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-680-1400 Limitation of Exempt Real Market Value

Under ORS 285C.353(4), each RREDZ designation has a cap on the total value in qualified property allowed, which is cumulatively exhausted with each exempt project over the life of the designation:

(1) Such value is the property’s real market value (RMV) on the assessment date of the first year that the authorized business firm may claim the exemption, not the amount exempted each year.

(2) The zone sponsor shall coordinate with the county assessor to track the amount of this limitation that former/ongoing exemptions have used and the remaining, unused portion. (If the assessor later disqualifies affected property and collects the property taxes back, then the initial RMV of the disqualified property increases the unused portion for future use in the same RREDZ)

(3) The exemption limitation described in this rule equals the amount specified in the resolution(s) adopted by the city, county or counties in applying for the RREDZ, and any such specified amount must be:

(a) Less than or equal to the maximum permitted under ORS 285C.353(4)(d);

(b) Evenly divisible by $5 million; and

(c) Greater than the unused portion of the previous RREDZ’s exemption limitation with a subsequent additional RREDZ as described in OAR 123-680-1200(4).

(4) If any such resolution fails to specify an exemption limitation for the RREDZ, or if two or more such resolutions comprising a joint application disagree as to the amount, then the limitation for that RREDZ defaults to the maximum permitted.

(5)(a) If new qualified property of an authorized business firm first subject to exemption in a single year will exhaust the exemption limitation, then the exemption or exemptions are allowed only up to the point at which the property’s RMV equals the unused portion; and

(b) In the case of two or more such firms subject to simultaneous exemptions, the assessor shall pro-rate the unused portion among them commensurate with the total value of each one’s applicable qualified property.

History

Statutory/Other Authority: ORS 285A.075 & 285C.370
Statutes/Other Implemented: ORS 285C.350 - 285C.370
OBDD 12-2015, f. & cert. ef. 10-5-15
OBDD 28-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-680-1600 Further Distinctions from an Enterprise Zone Exemption

For an RREDZ exemption, in comparison with a business firms’ using an enterprise zone:

(1) The application for authorization shall give special attention to characterizing the proposed investment in qualified property, clarifying how it relates to renewable energy, and estimating its real market value by January 1 of the first full calendar year of operations

(2) In order to qualify and be exempt, the property of the firm must effectively and substantively correspond to the description in the application, equivalent to OAR 123-674-1700(2).

(3) For purposes of a business firm’s receiving authorization and then qualifying:

(a) An “eligible business firm” under ORS 285C.135 relates only to such operations or business activities that are engaged in renewable energy.

(b) The “employment of the firm” under ORS 285C.200 and 285C.210:

(A) Relates only to employees engaged a majority of their time in eligible renewable energy operations within the RREDZ.

(B) Satisfies requirements for the addition of one or more employees respective to the existing number of employees, who work throughout the entire city, county or counties, as applicable.

(4) The exemption is essentially the same as that under ORS 285C.175, once property has been placed in service. There is, however, no special exemption during construction like under ORS 285C.170, although the exemption under ORS 307.330 may be used as otherwise permissible.

(5) For purposes of an additional one or two years of exemption (following the basic three-year period) on qualified property to be located inside a county that is part of a multi-county RREDZ but not its sponsor:

(a) At least 21 calendar days before execution of the requisite written agreement between the sponsor and the eligible business firm, which may contain additional local requirements that the business firm would need to satisfy, the sponsor shall give the county’s governing body formal notice of the potential extension to the tax abatement period; and

(b) If before the date, on which the firm and sponsor would execute the written agreement, the county’s governing body adopts a resolution electing not to participate, then there shall be no extended abatement for the proposed investment in qualified property in that county.

(6) For purposes of a local waiver of requirements for increasing the employment of the firm inside the zone:

(a) Only the sponsoring county of a multi-county RREDZ needs to adopt the requisite resolution by the time of authorization, regardless of the proposed location of qualified property;

(b) Provisions under ORS 285C.155 and 285C.200(2) otherwise pertain to RREDZs, including as described in OAR 123-674-4300; and

(c) Another type of waiver unique to RREDZs is allowed under ORS 285C.362(2), if the total investment in qualified property pursuant to the application equals or exceeds $5 million, but in this case the sponsor resolution shall not establish:

(A) An alternative minimum employment level, but rather it simply waives any such requirement; or

(B) Other conditions to be imposed on the business firm.

History

Statutory/Other Authority: ORS 285A.075 & 285C.370
Statutes/Other Implemented: OR 285C.350 - 285C.370
OBDD 7-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 12-2015, f. & cert. ef. 10-5-15
OBDD 16-2012, f. & cert. ef. 8-15-12
OBDD 28-2010, f. & cert. ef. 6-14-10

Division 690 LONG-TERM RURAL ENTERPRISE ZONE INCENTIVES

Or. Admin. R. 123-690-0001 Purpose and Scope

This division of administrative rules specifies the effect of provisions under ORS 285C.400 to 285C.420, 317.124 and 317.131. As such, these administrative rules:

(1) Address determinations, procedures and requirements of the up to 15 years of exemption from property taxes and of corporate excise tax credits for a facility inside a rural enterprise zone in a county experiencing particular economic hardship.

(2) Do not control or bind the county assessor or Department of Revenue, and they are superseded by OAR chapter 150 in matters related to tax administration.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.400 – 285C.420, 317.124 & 317.131
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-0100 Terminology

OAR 123-001 (Procedural Rules) contains definitions that are used in this division of administrative rules unless the context demands otherwise. In addition:

(1) Current County Wage means the finalized average annual wage, as most recently released for the Quarterly Census of Employment and Wages (QCEW) from the Oregon Employment Department, for all industries and ownerships in the county containing the Facility Site.

(2) Facility Site means a location consisting of one or more parcels of land and buildings that:

(a) Contain the ‘facility,’ as used in ORS 285C.400(4), and all (but not necessarily only) property of a certified business firm subject to an exemption under ORS 285C.409; and

(b) Are contiguous or have comparable proximity to each other, inside the boundary of a single rural enterprise zone, but it may also include one or more ancillary locations of interrelated investment and operations inside the same zone that are specifically identified as such in the agreement under ORS 285C.403(4) between the business firm and the zone sponsor.

(3) “In service” is defined in accordance with OAR 150-285-3400, or it has the meaning used under ORS 285C.050 in the absence of an applicable occupancy permit.

(4) “Sponsor” or “zone sponsor” has the same meaning as described in OAR 123-668, including but not limited to all of the zone’s cosponsors’ needing to jointly approve or exercise any and all actions under ORS 285C.400 to 285C.420.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.400 – 285C.420 & 317.131
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 12-2016, f. & cert. ef. 9-16-16
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-0500 Eligible Rural Enterprise Zones

For purposes of annually identifying applicable counties, in which the Facility Site needs to be entirely located at the time that the written agreement in OAR 123-690-2000 is executed:

(1) With on-line availability of (non-preliminary) annual statistics or data described in this rule, the Department shall analyze the data for all relevant years, ascertain which counties in the state satisfy ORS 285C.400(3) or (5), prepare associated information, and post it on the Department web site for use by the public and business firms, as well as local zone managers and county assessors.

(2)(a) The determination that a county meets the definition under ORS 285C.400(3) of a ‘county with chronically low income or chronic unemployment’ shall first take effect at least once a year on January 1 or July 1 following on-line availability of the latest annual data. As the Department deems appropriate in response to the release of new annual data or revisions to that data, the Department may reissue or modify the determination, update associated information, and set the effective date for changes in county status as warranted.

(b) A correct, prior determination in accordance with this section is not subject to retroactive change due to revisions to the annual data.

(A) The median derived according to paragraph (d)(C) of this section for the most recent 10 or 20 consecutive years is at least 1.3 rounded to the nearest tenth, based on unemployment rates described in paragraph (d)(A) of this section.

(B) The median derived according to paragraph (d)(C) of this section for the most recent 10 consecutive years is equal to or less than 0.75 rounded to the nearest one-hundredth, based on per capita income levels described in paragraph (d)(B) of this section.

(C) The county’s change in total population minus natural population change is equal to or less than negative one (-1), based on the most recent estimates available from the Portland State University Population Research Center, in comparison to the latest decennial U.S. Census count of not less than three years earlier.

(d) As used in ORS 285C.400(3):

(A) “Most recently revised annual average unemployment rate available” means the estimated percent of the civilian labor force that is unemployed on average according to Local Area Unemployment Statistics (LAUS) from the Oregon Employment Department in each of the most recent calendar years available.

(B) “Most recently revised … annual per capita income levels available” means the average annual per capita personal income level as estimated and revised by the U.S. Bureau of Economic Analysis for each of the most recent calendar years available.

(C) “Median ratio of the county to the equivalent of the entire United States for each year” means the average for the two middlemost quotients that result from dividing the county figures described in paragraph (A) or (B) of this subsection by each year’s corresponding national figure over 10 or 20 years.

(3) As used in ORS 285C.400(5) to identify qualified rural counties:

(b) “The total property taxes imposed by all taxing districts within the county are equal to or greater than 1.3 percent of the total assessed value of all taxable property located in the county” means that the quotient of the respective amounts from the Department of Revenue’s most recently published Oregon Property Tax Statistics (150-303-405) for a county is at least 0.013 rounded to the nearest one-thousandth. Those amounts shall be updated as feasible and necessary based on the county’s current Summary of Assessment & Levies, Table 1a (7) Total and Table 8 line 1.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.400 & 285C.403
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 12-2016, f. & cert. ef. 9-16-16
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-2000 LOCAL APPROVAL — Written Agreement

For purposes of the written agreement between a certified business firm and the sponsor of the rural enterprise zone under ORS 285C.403(3)(c) and(4):

(1) The agreement is to include but is not limited to the following:

(a) Acknowledgment of the planned or pending application for certification under ORS 285C.403(1) and (2);

(b) Concise description of the firm’s proposed investments, Facility Site and workforce;

(c) Specification of the obligations that the proposed investments and workforce must satisfy under ORS 285C.412, which the agreement in no way supersedes;

(d) Identification of all the parties to the agreement and their representatives;

(e) Zone sponsor’s explicit approval for the firm to receive the exemption under ORS 285C.409 on qualifying facility property;

(f) Provision under ORS 285C.403(4)(a) for the number of consecutive years that comprise the period of exemption under ORS 285C.409(1)(c), beginning in the year directly after the facility is placed in service:

(A) Shall be not less than 7 and not more than 15 years (but it is only 7 years if nothing is said on the matter); and

(B) May adjust at the election of the business firm or upon fulfillment of a certain condition or criterion, such that it:

(i) Expires early after at least seven years but before the stated number of years, at which point statutory or local additional requirement are no longer in effect or enforceable under ORS 285C.420 or otherwise; or

(ii) Extends a certain number of years beyond the stated number of years but not to more than 15 years in total; and

(g) With respect to additional conditions or requirements by the zone sponsor under ORS 285C.403(2)(e) and (4)(c) according to OAR 123-668-2000(1), either:

(A) Indication that the sponsor is not imposing or requesting any such condition or requirement; or

(B) Specification of any such condition or requirement, in accordance with OAR 123-668-2000 to 123-668-2500, including but not limited to standards and methods for demonstrating satisfaction of the condition or requirement, as well as consequences of noncompliance, such that the business firm expressly acknowledges when noncompliance would entail retroactive disqualification of the exemption, termination of the remaining exemption period, or an alternative consequence.

(2) The agreement may be:

(a) Part of a broader accord involving parties other than the business firm and the sponsor, insofar as the accord still conforms to section (1) of this rule.

(b) Preapproved or subsequently authorized by resolution or by other means of the zone sponsor, or of each cosponsor, consistent with OAR 123-668-2400 and 123-668-2450.

(3) An authorized representative or representatives of the business firm and of the zone sponsor must execute the agreement:

(a) On or after the effective date on which:

(A) The zone is designated or some or all of the Facility Site is amended into the zone through a change in the boundary of the zone; and

(B) The county containing the Facility Site satisfies definitions under ORS 285C.400(3) or (5) in accordance with OAR 123-690-0500; and

(b) Before:

(A) The zone has terminated; or

(B) The county becomes ineligible due to the opposite effect of paragraph (a)(B) of this section.

(4) The sponsor shall provide a copy of the signed and dated written agreement to the Department, which shall review the agreement, and if the following are accurate, the Department shall issue a letter for attachment to the written agreement confirming that:

(a) On the date of its execution it effectively satisfied section (3) of this rule, and one party to the agreement is the sponsor of the rural enterprise zone; and

(b) The agreement appears to generally conform to the description in section (1) of this rule.

(5) Following the effective date of the enterprise zone’s termination, the agreement may not be substantially modified, replaced, amended, supplemented or terminated.

(6) Any agreement entered into on or after September 24, 2023:

(a) Shall take effect only in accordance with OAR 123-668-3000; and

(b) Is not valid unless stipulating a rate for the school support fee under ORS 285C.403(4)(b) in accordance with OAR 123-668-4000 and 123-668-4100.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.403, 285C.405, 285C.407, 285C.408 & 285C.409
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-2100 Requisite County/City Resolutions

For purposes of resolutions adopted under ORS 285C.403(3)(a):

(1) A requirement for certification is the adoption of a resolution expressly approving the exemption of facility property by the county and by any city in which the Facility Site is located, as follows:

(a) Both the county and the city must adopt such a resolution if any part of the Facility Site is located in incorporated territory, but only the county must adopt such a resolution if the Facility Site is located entirely in unincorporated territory.

(b) Authorization or approval of a written agreement described in OAR 123-690-2000 by formal resolution of the governing body of a city or county sponsor of the zone automatically fulfills this requirement for that city or county, as the case may be.

(c) If the county or city does not sponsor the zone, it may nevertheless be a party to the written agreement in accordance with OAR 123-690-2000(2), but the necessity of a formal resolution remains.

(2) Adoption may occur at any time irrespective of when the agreement is executed or of an effective date in OAR 123-690-2000(3) for the sake of then certifying the business firm. If, however, the resolution also substantially implements all or part of the agreement by the zone sponsor, as opposed to merely authorizing or endorsing execution of an otherwise operable agreement, its adoption must occur after the agreement’s execution and before the zone terminates.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.403
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-2300 Applying for Certification

For purposes of the application for certification under ORS 285C.403(1) and (2):

(1) In order for a business firm to receive the exemption on facility property under ORS 285C.409:

(a) The firm must do the following before hiring new employees at the Facility Site and before commencing any physical work, as described in OAR 123-690-4000(1)(a), on property that would be subject to the exemption:

(A) Fill out the latest revision of Department of Revenue Form OR-AP-CERT, 150-310-073, Oregon Enterprise Zone Certification Application: Long-Term Rural Tax Incentive (available at oregon.gov/dor/forms/Pages/default.aspx), as completely as the firm is capable of doing;

(B) Have the form signed and dated by the owner or authorized representative of the firm; and

(C) Submit a signed original of the form to either the local zone manager representing the sponsor of the enterprise zone or the county assessor of the county in which the Facility Site is located, and an executed copy to the other.

(b) Submission of the application form as described in subsection (a) of this section must occur before the effective date of the rural enterprise zone’s termination.

(2) Submission of the application form may occur before or after any relevant resolution, commitment, written agreement, or effective date of determination that the county meets the definition under ORS 285C.400(3).

(3) Estimated numbers, anticipated dates or other expectations as indicated in the application form are not binding. The business firm shall base them on the best and most current information available to it at the time and shall inform the local zone manager and county assessor in writing of any significant changes to such expectations.

(4) The commitments made by the business firm (as required in the application form or otherwise during the certification process) shall be accepted at face value for purposes of certifying the firm, but such a commitment shall not relieve the firm of actually needing to meet any applicable requirement under ORS 285C.400 to 285C.420 and 307.124.

(5)(a) Each facility must have its own application, even if:

(A) Covered by a common agreement or by the same resolution(s) of the zone sponsor/local governments; or

(B) Located at the same Facility Site as one or more other facilities.

(b) A facility is not necessarily limited to a single building or structure, unless so defined in the certification application, agreement and supporting documentation.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.403
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-2400 Certification

For purposes of ORS 285C.403(3) to (7), following submission of the business firm’s application for certification as described in OAR 123-690-2300:

(1) The signature of the local zone manager or the county assessor’s office in approving the certification application is invalid:

(a) After the facility has been placed in service;

(b) After any facility property is assessable as of January 1, even if in the process of construction, reconstruction, additions, modification or installation, in that:

(A) Any such property must be exempt at that point to receive any exemption at all under ORS 285C.409 in accordance with OAR 123-690-6000(2); and

(B) For any property to be exempt the business firm needs to be already certified;

(d) Before any of the following (unless formally reaffirmed afterwards):

(A) The commitments by the firm in the application to meet requirements under ORS 285C.412;

(B) The relevant written agreement;

(C) Any resolution by the sponsor or a cosponsor of the zone that authorizes or effects the written agreement in paragraph (B) of this subsection; or

(D) The requisite resolution or resolutions under ORS 285C.403(3)(a) by the county and city (if applicable) in which the Facility Site is located.

(2) Approval of the certification application may occur after:

(a) The effective date of the termination of the enterprise zone consistent with OAR 123-650-9500 and 123-650-9600, except as described in subsection (1)(c) of this rule; or

(b) Commencement of applicable hiring or physical work on exempt facility property.

(3) Except as qualified in this rule or OAR 123-690-5200(2)(a), the local zone manager and the county assessor shall approve the certification application upon satisfaction of the criteria under ORS 285C.403(3), such that:

(a) At that point, the business firm is certified and may receive any applicable exemption on property that will or does comprise the facility under ORS 285C.409(1); and

(b) Within 30 days, the zone manager and assessor shall send the firm, the Department and the Department of Revenue copies of the approved certification application, executed written agreement, and any other attachment to the application or document related to certification.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.245, 285C.403, 285C.408, 285C.409 & 285C.412
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-3000 Allowable Facility Operations

With the exception of a local retail “fulfillment center” as defined in OAR 123-674-1000(2), there is no restriction on the type of business operations or activities that may be undertaken at a facility in terms of the business firm’s certification or of the facility’s exemption under ORS 285C.409(1).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285.403 & 285C.409
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-690-4000 FACILITY CRITERIA — Minimum Investment Size

For purposes of the required minimum investment under ORS 285C.412(1)(a), (2)(a), (3)(a), (4)(b) or (5)(a) in property that is owned or leased by a certified business firm and located at the Facility Site:

(1) Subject to section (2) of this rule, the following costs count toward the minimum investment:

(a) Construction, reconstruction, modification, refurbishing, reconditioning, retrofitting, upgrading and installations that commence after the application for certification, including but not limited to the costs of materials, supplies, labor, building contractors, engineering, physical connections to utilities, on-site development or site preparation; or

(b) Property acquired or moved to the Facility Site after the application for certification. (Current fair market value substitutes for price if the property is not subject to a recent transaction, such as leased or newly transferred property in certain cases)

(2) Costs due to activities or actions described in section (1) of this rule count toward the minimum investment only if incurred for:

(a) The following types of property or change in property value, which would be subject to exemption under ORS 285C.409:

(A) One or more newly constructed buildings or structures;

(B) Additions or modifications to any previously constructed or occupied building or structure; and

(C) Newly installed or newly upgraded, reconditioned, refurbished or retrofitted real property machinery & equipment or personal property, whether or not it is inside or on a building or structure described in this subsection, including non-inventory supplies, spare parts or otherwise taxable vehicles operated within the confines of the Facility Site.

(b) Land, improvements to the land, or the existing value of any property already at the Facility Site, notwithstanding that under ORS 285C.409(5) no such property is subject to exemption.

(c) Property leased by the firm and described in subsection (a) or (b) of this section, although property or property value described in subsection (a) of this section may be exempt only if the firm is fully responsible for any ad valorem tax through explicit provisions of a lease agreement.

(d) Any whole category of property as otherwise described in subsection (a) or (c) of this section, even though the certified business firm, in first claiming an exemption under ORS 285C.409(1)(a) or (c), formally and irreversibly elects to exclude it from any further exemption, including but not limited to an exclusion made pursuant to the agreement under ORS 285C.403(3)(c) with the zone sponsor.

(3) Regardless of their association with the Facility Site or exemption under ORS 285C.409, the following do not count toward the minimum investment:

(a) Cost of financing (including but not limited to debt service), legal fees (except as necessary in obtaining government permission for facility development), ongoing management and maintenance, or similar (non-capital) expenses;

(b) Cost or value of property that at the time of the application for certification is already owned or leased by the firm and located at the Facility Site;

(d) Any vehicle or device pulled, pushed or carried by a vehicle that is designed to hold and transport people, goods or property beyond the Facility Site, including but not limited to aircraft, barges, carriages, railcars, trailers, trucks or ships (which are also not exemptible in any case); or

(e) Expenses associated with activities or actions described in section (1) of this rule that are incurred only after the calendar year in which exempt facility property is first placed in service, although the property associated with those activities or actions may be exempt for the remainder of the period under ORS 285C.409(1)(c).

(4) The firm shall provide notice to the assessor in writing as soon as possible after satisfaction of this requirement is verifiable, to be documented through existing project expense records or retrospective compilation of evidence as necessary or appropriate.

(5) In determining ‘real market value of all nonexempt taxable property in the county,’ as used in ORS 285C.412, the Department shall rely on the most recently available fiscal year of Oregon Property Tax Statistics (150-303-405) from the Department of Revenue at the time of certification.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412 & 285C.415
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-4200 Minimum Hiring

For purposes of the minimum hiring and employment requirements to be met and maintained under ORS 285C.412(1)(b), (2)(c), (3)(d), (4)(d) or (5)(c) by a certified business firm:

(1) Employees are persons:

(a) Working for the firm at the Facility Site more than 32 hours per week in an established, year-round position (as opposed to any form of averaging hours worked, such as full-time equivalency); and

(b) Whom the business firm, an affiliated company, or a third party fully charged with general facility operations:

(A) Employs (under ORS chapter 316 respective to Oregon personal income tax withholding), contracts with or leases; or

(B) Directs on a daily basis and has significant control over personnel decisions, although an independent contractor employs the person to deliver or perform specific services at the Facility Site (as opposed, for example, to workers who are assigned at the discretion of a vendor or contractor).

(2) The number of employees located and performing their jobs at the Facility Site, less the base number of employees as calculated in sections (4) to (7) of this rule, must equal or exceed the applicable minimum under ORS 285C.412.

(3) The firm shall provide notice to the assessor in writing, with payroll records or other evidence as necessary or appropriate, as soon as possible after satisfaction of section (2) of this rule is achieved. This must occur in a calendar year that is not more than the applicable number of years set forth below after the calendar year in which exempt facility property is first placed in service:

(a) Five years under ORS 285C.412(1) or (4); or

(b) Three years under ORS 285C.412(2), (3) or (5).

(4) The base number of employees is one of the following figures, adjusted in accordance with sections (5) and (6) of this rule:

(a) The total number of employees working at the Facility Site on the date 12 months before the date that property subject to exemption under ORS 285C.409(1)(c) is first placed in service, if the agreement under ORS 285C.403(3)(c) and (4) with the zone sponsor does not otherwise stipulate; or

(b) As stipulated in the agreement, the total or annual average number of employees working at the Facility Site as of the date:

(A) The firm submitted its application for certification pursuant to OAR 123-690-2300;

(B) The application was fully approved and the firm was certified according to OAR 123-690-2400; or

(C) Specified in the agreement, which may be after the date of application but not less than 12 months before the date property is first placed in service.

(5) The base number includes employees engaged in equivalent occupations/operations of the certified business firm or any other firm under common ownership or control that are transferred to the Facility Site from another location within this state which experiences corresponding job losses, at any time after the application is made but before the end of the applicable calendar year in section (3) of this rule.

(6) The base number excludes current or former employees of the certified business firm who are recruited for, hired or rehired at the facility, but whose employment at the Facility Site is unrelated to the transfer of existing operations or occupations from elsewhere in this state.

(7) If specified as such in the agreement under ORS 285C.403(4) with the zone sponsor, the base number also excludes:

(a) Employment in excess of what is required on previously exempt investment(s) as described in OAR 123-690-6200(4).

(b) Employment located within the Facility Site but engaged in distinct operations and working in separate areas that are not involved with any property subject to the exemption under ORS 285C.409.

(c) Employment to be transferred to the Facility Site as described in section (5) of this rule, if the zone sponsor formally accepts the firm’s public assertion that the operations and jobs would be otherwise transferred somewhere outside this state but for the exemption, and:

(A) The existing location is within the jurisdiction or territory of a government (or subdivision thereof) that sponsors the enterprise zone; or

(B) The Department concurs with the sponsor in the letter described in OAR 123-690-2000(4) for an existing location elsewhere in Oregon.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412 & 285C.415
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 1-2021, amend filed 01/08/2021, effective 01/08/2021
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-4400 Minimum Distance from I–5

For purposes of the minimum distance from the Facility Site of a certified business firm to Interstate Highway 5 (I-5) under ORS 285C.412(3)(b) or (5)(b):

(1) Measure the distance as:

(a) A straight line; and

(b) The shortest possible gap between any part of the Facility Site and a point along the median of the highway, regardless if that point is in this state or offers access on/off the highway.

(2) Exclude any spur or bypass such as I-105 or I-205.

(3) Round distances to the nearest whole number, such that an applicable location must be effectively farther than 10.4 miles from I-5.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412 & 285C.415
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-4600 Minimum Average Annual Compensation

For purposes of the minimum average annual compensation to be met and maintained under ORS 285C.412(1)(c), (2)(b), (3)(c), (4)(c) or (5)(d) by a certified business firm:

(1) Compensation includes total calendar-year remuneration that is:

(a) In the form of wages, salary, bonuses, commissions, shift differential, overtime pay, profit-sharing, paid vacation and so forth that comprise taxable income, as well as associated fringe or financial benefits (whether taxable or not) such as life insurance, medical coverage or retirement plans, but excluding:

(A) Free meals, club membership or comparable workplace amenities;

(B) Payroll-based tax or cost mandated by federal, state or local law, such as worker’s compensation or unemployment insurance or the employer’s share under FICA; and

(b) Paid to any employee located and performing work for the certified business firm at the Facility Site, consistent with OAR 123-690-4200(1), regardless of hours worked per week or the permanence or newness of the employee’s position, except if excluded by OAR 123-690-4200(7)(b).

(2) Actual compensation described in section (1) of this rule shall be annualized in the case of jobs at the Facility Site, in which the employee works less than 40 hours per week or for less than the entire calendar year, by dividing 1,820 by the hours of actual time worked on the job for the calendar year and multiplying that quotient by the employee’s actual compensation.

(3) The firm shall add all employees’ total annual compensation under section (1) or (2) of this rule, as applicable, and divide that sum by the number of applicable (annualized) employees or positions to derive average annual compensation.

(4) In a calendar year after the calendar year in which exempt facility property is first placed in service – but in or before the fifth such year – this computed average annual compensation must equal or exceed:

(a) 1.5 times the Current County Wage; or

(b) 1.3 times the Current County Wage, but only if:

(A) The first year of the 7 to 15-year exemption under ORS 285C.409(1)(c) begins in or after 2018 (regardless of when the business firm applied or was certified); and

(B) The Facility Site is located entirely inside a qualified rural county at the time that the written agreement in OAR 123-690-2000 was executed.

(5) The firm shall provide notice to the assessor in writing as soon as possible after satisfaction of section (4) of this rule is achieved, with payroll records or other evidence as necessary or appropriate.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412 & 285C.415
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-5000 ONGOING COMPLIANCE — Employment and Payroll

(1) The exemption of a facility under ORS 285C409(1) is disqualified under ORS 285C.420, consistent with OAR 150-285-3410, if:

(a) The facility fails to initially satisfy any of the requirements applicable to it under ORS 285C.412, for which the certified business firm shall also notify the assessor under ORS 285C.415 of any such failure consistent with OAR 123-690-5200(1)(c);

(b) After initial satisfaction of the minimum hiring requirement for total employment at the Facility Site in OAR 123-690-4200, applicable employment falls to less than the minimum (on average at least) in any assessment year during the remaining exemption period; or

(c) After initial satisfaction of the minimum average annual compensation requirement for all facility employees according to OAR 123-690-4600, in any assessment year during the remaining exemption period:

(A) Such average annual compensation is less than the minimum; or

(B) The facility’s average wage is less than 100 percent of the then Current County Wage, but only if the first year of the 7 to 15-year exemption under ORS 285C.409(1)(c) begins in or after 2018 (regardless of when the business firm applied or was certified).

(2) Disqualification as described in section (1) of this rule entails imposition of all property taxes that were otherwise due on the formerly exempt facility in all years. This includes but is not limited to any exemption received under ORS 285C.409(1)(a) or (b) while the facility was being constructed, which is also subject to disqualification if facility operations do not effectively commence as described in OAR 150-285-3420.

(3) The mandatory minimum level for average annual compensation of employees at the Facility Site remains fixed at the level established when the requirement is initially met, based on the multiple in OAR 123-690-4600(4) relative to the Current County Wage at that time. As such, the applicable county wage is set for purposes of paragraph (1)(c)(A) of this rule for the remainder of the exemption period.

(4) For purposes of ORS 285C.412(1)(c)(B) and of paragraph (1)(c)(B) of this rule:

(a) “Average wage” means total, annualized taxable income of all facility employee, as used in calculating amounts withheld under ORS chapter 316 for purposes of Oregon personal income taxes during the calendar year, and computed in the same way as average annual compensation in OAR 123-690-4600(1)(b), (2) and (3), and

(b) The applicable Current County Wage updates each year in contrast to section (3) of this rule.

(5) For separate exemptions at two or more separate Facility Sites of the same certified business firm in the same enterprise zone, the zone sponsor may allow employees, who work at and regularly move between sites, to be counted proportionally among the sites according to an explicated method for purposes of satisfying the respective requirements of each exemption.

(6) Notwithstanding subsection (1)(b) or (c) of this rule, the applicable employment or average annual compensation/wages of employees at the Facility Site may fall below the mandatory minimum level under certain extenuating circumstances, including but not limited to the following:

(a) A natural disaster, conflagration, epidemic or the like substantially disrupting the relevant operations of the certified business firm;

(b) Six or more months of severe economic troubles or military conflict significantly affecting the United States and other major foreign economies or the certified business firm’s industry;

(c) Unforeseen coincidence of vacant positions at the Facility Site, such as the case in which employees die, quit or have been fired for cause; or

(d) Temporary curtailment in operations at the Facility Site lasting no longer than twelve months to undertake major repairs in response to mechanical breakdowns that are unusual and unexpected within normal engineering parameters and maintenance program for exempt facility property.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412, 285C.415 & 285C.420
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 12-2016, f. & cert. ef. 9-16-16
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-5200 Post-Certification Verification

Pursuant to certification as described in OAR 123-690-2400 for purposes of qualifying for and continuing to receive exemption under ORS 285C.409(1):

(1) A certified business firm shall submit in writing to the county assessor (and to the zone sponsor, Department, or Department of Revenue, as requested) understandable documentation relevant to the following:

(a) The investment costs and so forth of property at the Facility Site as described in OAR 123-690-4000(2), including but not limited to the particulars of any leased property;

(b) The date on which facility property subject to exemption under ORS 285C.409(1) is fully permitted for occupancy respective to intended commercial operations or is otherwise first placed in service; and

(c) The date on which and the method by which each applicable requirement under ORS 285C.412 is initially satisfied, or effectively cannot and will not be satisfied, including but not limited to notice required to be sent to the county assessor under ORS 285C.415 as described in OAR 123-690-4000(4), 123-690-4200(3) and 123-690-4600(5).

(2) For purposes of section (1) of this rule and ongoing compliance with applicable requirements under ORS 285C.412:

(a) The county assessor may agree with the business firm in writing to certain methods or mechanisms to be implemented by the firm with respect to notifications or submission of information, as a condition of the county assessor’s approval of the certification application.

(b) The written agreement under ORS 285C.403(4) with the zone sponsor may (also) contain such methods or mechanisms for communication of operational status and verification of compliance with local or statutory requirements.

(3) Any lack of the arrangements described in section (2) of this rule does not relieve the business firm of its obligation to demonstrate compliance with and satisfaction of any applicable requirement, as the assessor or Department of Revenue may demand.

(4) The Department shall prepare a worksheet, which is:

(a) Available from the Department at: Incentives, Business Oregon, State Lands Building Suite 310, 775 Summer Street NE, Salem OR 97301-1280, see www.oregon.gov/biz; and

(b) Hereby incorporated and made part of these administrative rules by reference, in order for business firms to readily report recent employment and compensation for purposes of ongoing compliance under ORS 285C.412.

(5) The zone sponsor shall annually give notice to all certified business firms in its enterprise zone that they must fill out and return the worksheet or equivalent documentation of compliance (whether in the absence of, in addition to or as part of arrangements in section (2) of this rule), whereby:

(a) The sponsor shall specify a due date for its receipt of the worksheet, which shall be between March 1 and June 1 of each year but never less than 60 days after sending regular, formal notice;

(b) If the sponsor’s notice also asks for additional information to corroborate the worksheet that a certified business provides with a good faith request that the information not be publicly released because of its sensitive, proprietary or similar nature, the sponsor may honor the request as otherwise allowed under ORS 192.355(4) or other applicable laws;

(c) The sponsor shall share copies of returned worksheets and corroborating information with the Department, the county assessor or other relevant officials, as requested and in accordance with subsection (b) of this section; and

(d) The sponsor shall report the failure by any business firm to fulfill this requirement to the Department and county assessor.

(6) If a certified business firm fails to return a worksheet pursuant to subsection (5)(a) of this rule or to fulfill or respond as otherwise provided in this rule, or if the zone sponsor seriously doubts submitted information and suspects noncompliance:

(a) The sponsor and county assessor may jointly demand by registered/certified mail that the firm substantiate its employment, compensation or other compliance issue under ORS 285C.412, to be safeguarded as in subsection (5)(b) of this rule.

(b) If the firm does not respond within 60 days of such mailing, then the zone sponsor shall assume noncompliance under ORS 285.412, and the assessor may retroactively disqualify the exemption under ORS 285C.420.

(7) This rule does not pertain to any additional local condition or requirement, for which verification of compliance is solely the responsibility of the zone sponsor pursuant to arrangements in the agreement between the zone sponsor and the certified business firm under ORS 285C.403(4)(c), consistent with OAR 123-690-2000(1)(g).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.409, 285C.412, 285C.415 & 285C.420
OBDD 44-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-6000 PROPERTY TAX CONTINGENCIES — Other Exemptions

(1) An eligible business firm may seek and receive approval for authorization under ORS 285C.140 according to OAR 123-674, while applying for or being certified under ORS 285C.403, although the business firm shall decide irrevocably on which program to use before seeking any exemption on mutually applicable property—either under ORS 285C.409(1)(a) and (b) or under ORS 285C.170 or 307.330—that is in the process of construction, reconstruction, additions, modifications or installation.

(2) For purposes of ORS 285C.409(5), a certified business firm’s receipt of the 7 to 15-year exemption period on facility property under ORS 285C.409(1)(c) demands that:

(a) The property has been exempted under ORS 285C.409(1)(a) or (b) during construction or while making improvements or installations, insofar as the property existed at the Facility Site on an assessment date when the facility was not yet in service; and

(b) On or before any such assessment date, the firm was certified under ORS 285C.403 in accordance with OAR 123-690-2400.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.403, 285C.409 & 285C.420
OBDD 45-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 14-2024, amend filed 06/10/2024, effective 06/10/2024
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-6200 Subsequent Facility Site Investments

For property newly placed in service at the same Facility Site on or after the (January-1) assessment date of an ongoing exemption under ORS 285C.409(1)(c):

(1) Any such property may also receive the exemption but only for the remainder of the 7 to 15 tax years available, and neither additional operations nor the introduction of such property at the Facility Site shall lengthen or add to the ongoing period of exemption on property at the Facility Site.

(2) A certified business firm may receive another (potentially overlapping) period of exemption under ORS 285C.409(1) on such additional property constituting another facility under ORS 285C.400(4) at the same Facility Site, but only if independent of the respective actions and investments pertaining to the firm’s certification or qualification for any previously granted exemption, the firm again:

(a) Applies and receives approval for certification;

(b) Respectively undertakes additional operations at the Facility Site; and

(c) Satisfies the applicable requirements to qualify for the exemption, including but not limited to the firm’s having submitted notice(s) under ORS 285C.415 to the county assessor of having timely met all applicable requirements under ORS 285C.412.

(3) In the case of a business firm certified for another exemption on additional property pursuant to section (2) of this rule:

(a) The property reverts to the preexisting exemption, and the assessor shall treat the additional property as a part of that remaining period of exemption consistent with section (1) of this rule, if before the end of the preexisting exemption’s final tax year:

(A) The firm submits a formal request to that effect, withdrawing its subsequent certification, as received by the county assessor and zone sponsor; or

(B) The firm effectively fails to qualify, contrary to subsection (2)(c) of this rule, including but not limited to the absence of any requisite notice.

(b) Otherwise, the additional property stays exempt until the end of its own period of exemption. It is then, however, subject to the operation of ORS 285C.420 (retroactive disqualification for failure to meet or maintain an applicable requirement) to the point when any exemption on that property was first allowed under ORS 285C.409(1), including but not limited to where at the conclusion of the preexisting exemption, in contrast to subsection (a) of this section:

(A) There was no timely request; and

(B) Initial qualification was still indeterminate, but then later, not achieved.

(4) In the case of any subsequent exemption according to section (2) of this rule that begins within seven years after the first year of the most recent ongoing exemption under ORS 285C.409(1)(c), the agreement with the zone sponsor under ORS 285C.403(3)(c) may give the certified business firm credit for some or all of its existing employees at the Facility Site, who were hired in excess of minimum requirements for a previous, ongoing exemption, in meeting the newer exemption’s required hiring.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.403, 285C.409 & 285C.412
OBDD 6-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Or. Admin. R. 123-690-6400 Multiple, Joint Facilities

For purposes of two or more exemptions under ORS 285C.409(1)(c) as provided under ORS 285C.412(4), for which exempt facility property in each case is first placed in service over not more than four consecutive calendar years:

(1) Not only may the exemption periods start in different years, but their lengths may also vary respective to each agreement between the zone sponsor and certified business firm under ORS 285C.403(3)(c).

(2) If involving different Facility Sites, including but not limited to inside the same enterprise zone, the number of employees shall be determined separately subject to any base number at each Facility Site, consistent with OAR 123-690-4200, before being combined for purposes of ORS 285C.412(4)(d).

(3) If at the same Facility Site, each exemption must pertain to distinct investments or operations, but a common base number of employees shall be used.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.412
OBDD 46-2024, minor correction filed 10/17/2024, effective 10/17/2024
OBDD 11-2015, f. & cert. ef. 10-5-15

Or. Admin. R. 123-690-6900 Property at Time of Zone Termination

(1) OAR 123-650-9500 to 123-650-9700 address treatment of facility property in an enterprise zone that has terminated.

(2) If the location of a certified business firm’s (proposed) facility becomes part of a newly designated or amended rural zone, then the firm’s certification transfers directly to that zone, provided that the certification was still valid consistent with OAR 123-674-9500 or 123-674-9600 as of the effective date of the designation or boundary change.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: ORS 285C.245 & 285C.409
OBDD 14-2024, adopt filed 06/10/2024, effective 06/10/2024

Or. Admin. R. 123-690-8500 Revenue Distribution to Local Zone Sponsor

(1) The sponsor of an enterprise zone containing exempt facility property owned by a corporation that claims the tax credit under ORS 317.124 might receive funds through the Department of Revenue from the Long Term Enterprise Zone Fund established under ORS 317.127.

(2) The sponsor’s receipt of such funds depends on:

(a) The qualifying taxpayer’s being allowed to claim the credit for the corporate excise tax year;

(b) The taxpayer’s making actual payment to fulfill its applicable tax liability; and

(3) As to amounts for distribution and the current state fiscal year:

(a) If they exceed the property taxes that relevant taxing districts would otherwise have received in the corresponding property tax year, but for exemption under ORS 285C.409, then that excess goes to the zone sponsor.

(b) If there is no relevant exemption under ORS 285C.409 in the corresponding property tax year, then the entire amount goes to the zone sponsor.

(4) For purposes of section (3) of this rule, the zone sponsor is responsible for making timely arrangements, so that it:

(a) Can receive distributed funds in a way that effectively ensures the Department of Revenue of having made payment to the zone sponsor (including but not limited to a joint mechanism among all cosponsors, or a deposit account administered by a single cosponsor on behalf of the entire zone sponsorship); and

(b) Satisfies applicable provisions of ORS Chapter 294 and other state or local laws with regard to collecting, holding and using such funds.

History

Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 317.131
OBDD 10-2023, amend filed 07/05/2023, effective 07/05/2023
OBDD 5-2017, amend filed 11/29/2017, effective 11/29/2017
OBDD 11-2015, f. & cert. ef. 10-5-15
OBDD 29-2010, f. & cert. ef. 6-14-10

Division 700 CHILD CARE INFRASTRUCURE PROGRAM

Or. Admin. R. 123-700-0000 Purpose and Objectives

These rules establish procedures for the administration of the Child Care Infrastructure Fund Program ("Program") under which the Oregon Business Development Department will award grants and loans to fund the planning, design, maintenance, and acquisition of Child Care Facilities that are funded with monies from the Child Care Infrastructure Fund established by ORS 329A.725.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0010 Definitions

For the purposes of these rules additional definitions may be found in OAR 123-001-0010 and ORS 329A.723. As used in this Division of administrative rules, the following terms shall have the following meaning, unless the context clearly indicates otherwise:

(1) "Child Care Facility" means any facility that provides child care to children, including a day nursery, nursery school, child care center, outdoor child care program, certified or registered family child care home or similar unit operating under any name. "Child Care Facility" does not include those entities excluded from the meaning of "Child Care Facility" under ORS 329A.250(5).

(2) "Child Care Infrastructure Project" means a project that increases the capacity or quality of Child Care Facilities in the state of Oregon and includes new construction, commercial property acquisition, or repair and renovation of existing facilities.

(3) "Continued Use Period" means the minimum length of time a Child Care Facility must remain open and serving children upon project completion. The Continued Use Period for funded Child Care Infrastructure Projects will be a minimum of three years but not to exceed ten years. When determining the duration of a Continued Use Period, the Department may consider amount of funding award and entity type. The Continued Use Period begins at time of project completion.

(4) "Culturally Specific Early Learning Program" means an early learning program that is designed to serve a particular cultural community that experiences systemic disparities.

(5) "Department" means the Oregon Business Development Department.

(6) "Fund" means the Child Care Infrastructure Fund created by ORS 329A.725.

(7) "Municipality" means an Oregon city or county, a Port organized under ORS chapter 777 or 778, a county service district organized under ORS chapter 451, a district as defined in ORS chapter 198, a tribal council of a federally recognized Indian tribe in this state or an airport district organized under ORS chapter 838.

(8) "Non-Profit Organization" means an organization established as a nonprofit organization under the laws of Oregon.

(9) "Planning Project" means:

(a) A project related to a potential Child Care Infrastructure Project for preliminary, final, or construction engineering;

(b) A survey, site investigation or environmental action related to a potential Child Care Infrastructure Project;

(c) A financial, technical, or other feasibility report, study or plan related to a potential Child Care Infrastructure Project; or

(d) An activity that the Department determines to be necessary or useful in planning for a potential Child Care Infrastructure Project.

(10) "School District" has a meaning given that term in ORS 332.002.

(11) "System Development Charges" means one-time charges on new development and certain types of redevelopment to help pay for existing and planned infrastructure to serve that development.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0020 Request for Applications

(1) The Department will issue a Request for Applications ("RFA") prior to awarding any grants or loans under the Program. In compliance with these rules, the RFA will set out the process for Eligible Applicants (as defined in OAR 123-700-0070) to submit an application for Program grants and loans and the process the Department will use to evaluate applications and make funding decisions.

(2) The Department may provide assistance to applicants to help them better understand Program requirements and may provide training and technical assistance.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0030 Application Requirements

(1) In order to receive a Program grant or loan, an Eligible Applicant must submit an application that:

(a) Is in the form required by the Department;

(b) Contains or is accompanied by such information and documentation as the Department may require;

(c) Demonstrates that all landowners who own property on which the project will take place are aware of, and agree to, the work to be completed under the proposal. The applicant must attest that they will have control of the site for the entire term of the project.

(d) Contains an estimate of all project costs including materials, labor, contingency budget, and direct costs and expenses;

(e) Contains a project timeline;

(f) Contains reasonable bids and includes a timeline for obtaining all necessary approvals and permits for the proposed project;

(g) Satisfies any additional requirements the Department may impose in the RFA.

(2) The Department will not review applications that do not contain all the required elements.

(3) Satisfaction of the above requirements does not guaranteed that an applicant will receive a Program award.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0040 Application Review & Prioritization

(1) Applications will be evaluated by a committee consisting of Department staff, staff from the Oregon Department of Early Learning and Care, and qualified community partners. The committee will provide the Department with funding recommendations based on the criteria set for in these rules and the RFA. The Department retains all funding award authority.

(2) The committee will evaluate applications using an award rubric that results in a numeric rating for each the following categories and any additional categories set out in the RFA:

(a) The degree to which child care slots are created or preserved;

(b) The impact on licensing or health and safety of children;

(d) The project's hours of operation;

(e) Whether the project accepts subsidy;

(f) Whether the project provides culturally or linguistically appropriate care;

(g) Whether the project aligns with the regional child care priorities outlined in the Early Learning Hub's Early Education and Care Sector Plan as described in ORS 329.172(2)(a)

(h) The effect on infant and toddler care;

(i) The degree to which the proposed project is ready to proceed; and

(j) The proposed project's sustainability.

(3) After the committee completes the evaluation process set forth in the RFA, the Department will prioritize the applications based on the committee's scoring, geographic distribution, communities served, and any other factors set forth in the RFA to make award decisions.

(4) In the event that more than one application receives the same score, the applications have equal prioritization, and the Department lacks sufficient funding to award all applications, as set forth in these rules and the RFA, the Department may use a lottery to select applications that will receive an award.

(5) Applications that are selected for an award shall receive a notice of intent to award, and unsuccessful applicants shall receive a letter of explanation from the Department.

(6) As applicable, the notice of intent to award shall contain an offer of an amount for a grant or loan (or a combination thereof). The Department may make an offer that is less than what was requested by the applicant. Loan awards to public entity shall be conditioned on a pledge of the entity's full faith and credit and taxing power within Article XI, sections 11 and 11b of the Oregon Constitution.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0050 Conditions Precedent to Award

(1) Prior to making an award for a Child Care Infrastructure Project, the Department must make the following determinations:

(a) The project is feasible as demonstrated by certification from a professional engineer or architect registered in the State of Oregon in a feasibility study or other feasibility documentation approved by the Department;

(b) Any Program loan will be secured by the pledge of business revenues or other revenues or payments from the owners of any specially benefited properties, and these revenues or payments are sufficient, when considered with other security, to assure repayment of the loan and the recipient has certified to the Department that there will be adequate funds available to repay the loans;

(d) The applicant is willing and able to enter a contract with the Department;

(e) The project complies with the requirements governing assistance from the Fund;

(f) The applicant has demonstrated that it has, or can secure, the administrative capacity to undertake and complete the project; and

(g) The applicant has demonstrated:

(A) that it and its project are eligible to receive a Program award,

(B) the ability to secure full funding for the project,

(D) the ability to provide services and remain financially solvent throughout the term of project.

(2) For a Planning Project, the Department must determine that the requirements set out in sections (1)(b)-(g) of this rule are met.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0060 Eligible Applicants

(1) As determined by the Department, to be an eligible applicant for a Child Care Infrastructure Program award, applicants must be one of the following:

(a) Municipality;

(b) Certified or registered family child care provider as established in ORS 329A.280 or ORS 329A.330;

(d) A child care center certified under ORS 329A.280;

(e) Federally recognized Indian tribes in Oregon that are preschool providers participating in the Preschool Promise Program established under ORS 329.172;

(f) Organizations that support the expansion or establishment of child care providers;

(g) Programs that serve children in publicly funded early learning and care programs including:

(A) Programs funded by the Early Childhood Equity Fund established under ORS 417.781;

(B) Relief nurseries;

(D) Programs that provide early childhood special education or early learning intervention services, as provided by ORS 343.475;

(E) Oregon Head Start, prekindergarten and Early Head Start programs;

(F) Entities that receive awards under the Preschool Promise Program established under ORS 329.172 or the Oregon Prekindergarten Program established under ORS 329.175;

(h) Culturally Specific Early Learning Programs, early childhood and parent support programs described under ORS 417.782(1);

(i) School Districts that meet a 100% match requirement;

(j) Outdoor nature based child care programs; and

(k) New child care providers seeking licensure, provided that the new child care provider provides the Department with sufficient documentation to demonstrate to the satisfaction of the Department that,

(A) The applicant's background check has been cleared; and

(B) The items requested are requirements of the relevant regulatory authorities for the purpose of operating a Child Care Facility.

(2) To be eligible, each applicant must:

(a) Unless exempt, be registered with the Oregon Secretary of State to do business in Oregon;

(b) Unless exempt, have and maintain an active license to operate a Child Care Facility from the Oregon Department of Early Learning and Care;

(3) Notwithstanding the eligibility provisions of this rule, the Department may limit the number applications an applicant may submit in response to an RFA or limit the number of open Program projects an applicant may have at one time.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0070 Eligible Projects and Project Costs

(1) Eligible projects under the Program include:

(a) Construction of new Child Care Facilities;

(b) Renovation, expansion, repair, modernization, or retrofitting of an existing Child Care Facility;

(c) Renovation, expansion, repair, modernization or retrofitting of existing facilities to establish a Child Care Facility;

(d) Acquisition of property to be used to establish a Child Care Facility that will not be used as a private domicile; and

(e) Planning Projects conducted for the purpose of completing a project described under section (1)(a)-(d) of this rule.

(2) Reasonable and necessary costs for eligible projects are allowable. Allowable costs shall be determined by the Department and include:

(a) For eligible projects under (1)(a) of this rule,

(A) Predevelopment and planning;

(B) Architectural drawings and plans;

(C) Direct project management costs that represent new expenses incurred solely to support, plan for, and manage an eligible project.

(D) System Development Charges;

(E) Construction activities;

(F) Construction contingencies;

(b) For eligible projects under (1)(b) of this rule,

(A) Costs listed under section (2)(a) of this rule;

(B) Water leak mitigation and plumbing;

(D) Americans with Disabilities Act or green building standard upgrades;

(E) Heating, ventilation, and air conditioning systems that are permanently installed;

(F) Air purification or filtration systems that are permanently installed;

(G) Hazard testing and mitigation;

(H) Demolition or structural changes;

(I) Classroom updates; and

(J) Playground and outdoor upgrades.

(A) Costs listed under section (2)(a) and (2)(b) of this rule; and

(B) Facility modifications necessary to satisfy relevant licensing requirements.

(d) For eligible projects under (1)(d) of this rule,

(A) Costs listed under section (2)(a), (2)(b), and (2)(c) of this rule; and

(B) Appraisal costs.

(e) For eligible projects under (1)(e) of this rule,

(A) Architectural designs or engineering plans; and

(B) Feasibility studies.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0080 Ineligible Project Costs

(1) Only costs expressly allowed by OAR 123-700-0030 are eligible. All other project costs, including but not limited to those listed below, are ineligible:

(a) Acquisition of a home that will be used as a private domicile;

(b) Indirect costs;

(d) Classroom furnishings, items for curriculum use, and any unfixed, movable equipment;

(e) Consumables, supplies, or other items with short lifespans;

(f) Costs for construction activities that were not performed by a contractor licensed by the Oregon Construction Contractors Board (CCB) and the Oregon Corporate Division;

(g) Insurance;

(h) Internet provider costs;

(i) Rent or lease payments;

(j) Fines or penalties incurred by the violation of federal, state, or local laws, or ordinances or regulations;

(k) Legal fees and costs;

(l) Marketing;

(m) Training or apprenticeship costs;

(n) Relocation or moving costs associated with the project;

(o) Purchase or lease of vehicles;

(p) Start up costs, including operations/staff salaries;

(q) Technology systems (computers, phones, media devices);

(r) Travel or per diem expenses.

(2) Any and all costs incurred for work completed prior to an award are not eligible for reimbursement.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0090 Loan and Grant Information

(1) The Department will make Program awards in a manner that maximizes the use of available resources and maintains the Department's desired credit standards of the Fund. The Department shall determine the amount of grant or loan funds to be awarded, interest rate, and the terms of any award issued in response to the RFA. OBDD may offer an alternate mix of grant or loan awards or lower amount of award than requested by an applicant. The Department may investigate and recommend other sources of funds for all or part of a proposed project.

(2) Grant awards for Child Care Infrastructure Projects are each limited to $2,000,000 and shall not exceed the total project cost;

(3) Grant awards for Planning Projects are each limited to $75,000 and shall not exceed the total project cost;

(4) The Department will not award more than $2,000,000 total in grants for Planning Projects per biennium.

(5) Loan awards for Child Care Infrastructure Projects are each limited to $2,000,000 and shall not exceed the total project cost;

(a) The terms of the loan for Child Care Infrastructure Projects will not exceed the useful life of the contracted project or 30 years from the year of project completion, whichever is less.

(b) The term of a loan will be based on prudent and reasonable financial underwriting in the Department's sole discretion;

(c) The Department, in its sole discretion, may offer eligible borrowers an interest rate that is below the market rate; and

(d) Security pledges shall be required for all loans awarded in response to the RFA with the form and amount of security determined by the Department consistent with the nature of the project and the credit worthiness of the recipient.

(6) Loan awards for Planning Projects are each limited to $75,000 and shall not exceed the total project cost;

(a) The term of the loan for Planning Projects will not exceed 10 years from the year of project completion and;

(b) Conditions described under section (5)(b)-(d) of this rule.

(7) Grants or loans issued for property acquisition may not exceed the purchase price or the fair market value of the property based on a current appraisal performed by an Oregon state licensed or certified appraiser, whichever is less.

(8) As provided in ORS 329A.727, the Department must distribute a minimum of 25% of the appropriated funds to culturally specific early learning, early childhood and parent support programs described under ORS 417.782 (1).

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0100 Conditions Precedent to Disbursement of Funds

Notwithstanding the issuance of a notice of intent to award, the Department will not disburse grant or loan funds until each of the conditions set forth below are satisfied:

(1) The Department and the recipient have executed a binding contract and the contract shall be in a form provided by the Department, and must include:

(a) A provision that disbursements from the Fund will be according to the terms of the contract;

(b) A provision that the Department's obligations under the contract are contingent upon the availability of moneys in the Fund for use in the project;

(c) If any portion of the assistance is in the form of a loan, the contract must contain a provision granting the Department a lien on or a security interest in collateral, as determined by the Department in its sole discretion, to sufficiently secure repayment of the loan or bond;

(d) A provision that the recipient shall comply with a Continued Use Period requirement as determined by the Department;

(e) A provision that for a period of up to three (3) years after project completion, the Department may request that the Recipient, at its own expense, submit data on the benefits of the project, including but not limited to, information on number of children served resulting from the project, and other information necessary to evaluate the success and economic impact of the project;

(f) If the contract is between the Department and any other entity than an individual, the contract must be authorized by an ordinance, order or resolution adopted by the governing body or partners of the entity, and in accordance with any applicable requirements for notice and authorizing debt;

(g) A provision that the recipient will comply with all applicable state and federal laws, regulations and orders of any court or governmental authority that relate to the contract, the project and the operation of the facilities or infrastructure of which the project is a component. In particular, but without limitation, the recipient shall comply with the following, as applicable:

(A) All federal or state tax laws applicable to Recipient's implementation of the project and its use of the Program funds.

(B) State procurement regulations found in the ORS Chapters 279A, 279B and 279C;

(D) Oregon prevailing wage rates, municipal audit law, and procurement regulations; and

(E) Public display of information on Lottery funding of a project found in ORS 280.518. Recipient shall include the following statement, prominently placed on all plans, reports, bid documents and advertisements relating to the Project: "This Project was funded in part by the Oregon State Lottery and administered by the Oregon Business Development Department."; and

(2) The Department may request the recipient comply with any other provisions the Department considers necessary or appropriate to implement the Program.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0110 Recipient Responsibilities & Service Requirements

(1) The recipient shall have a plan for ongoing operation and maintenance that will preserve the project's benefits over the Continued Use Period.

(2) The recipient shall maintain accounts and records for all activities associated with the project and shall provide the Department reasonable access to such records upon request. The recipient shall submit periodic reports on the project if requested by the Department.

(3) If applicable, construction must start within 180 days of contract execution and award funds must be entirely spent within three years of the associated bond sale.

(4) If a contract has not been fully executed by all the parties within 60 days of Recipient receiving contract document, the Department may rescind its notice of intent to award and reallocate Program funds.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Or. Admin. R. 123-700-0120 Waivers and Appeals

(1) In its sole discretion, the Department may waive non-statutory requirements of the Program if it is demonstrated that such a waiver would serve to further the goals or objectives of the program.

(2) The Department will set forth any appeals from a funding decision in the RFA.

History

Statutory/Other Authority: ORS 285A.075
Statutes/Other Implemented: OR Laws 2023 ch 523
OBDD 18-2024, adopt filed 07/17/2024, effective 07/17/2024

Division 710 MICRO-ENTERPRISE TARIFF ADJUSTMENT GRANTS

Or. Admin. R. 123-710-0000 Temporary rule language in effect until 02/21/2027. Purpose

The purpose of these rules is to implement the Micro-Enterprise Tariff Adjustment Grant Program (“Program”), established by Oregon Laws 2026, Chapter 39, to provide grants to eligible Oregon businesses to cover significant increases in business costs due to tariffs imposed by the federal government.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027

Or. Admin. R. 123-710-0010 Temporary rule language in effect until 02/21/2027. Definitions

(1) “Additional Tariff Duties” means duties imposed on imported goods under Section 301 of the Trade Act of 1974, Section 232 of the Trade Expansion Act of 1962, International Emergency Economic Powers Act (“IEEPA”) fentanyl-related tariffs, IEEPA reciprocal tariffs, or related federal tariff actions effective on or after April 2, 2025, assessed in addition to base duty rates. Additional Tariff Duties do not include base duty rates, carrier fees, brokerage fees, or administrative fees.

(2) “Annual Sales” means total gross revenue from the sale of goods or services in the most recent tax year.

(3) “Application Period” means the period of time established by the Department during which Businesses may submit applications for Program grants.

(4) “Attested Tariff Amount” means the total amount of Additional Tariff Duties assessed or paid on imports during the Eligible Period as reported by the Authorized Representative of the Business in the grant application.

(5) “Authorized Representative” means an individual with legal authority to bind the Business.

(6) “Business” means a for-profit business that is registered with the Oregon Secretary of State and that is one of the following:

(a) A corporation incorporated or authorized to transact business under ORS chapter 60;

(b) A limited liability company organized or authorized to transact business under ORS chapter 63;

(d) A limited partnership formed or authorized to transact business under ORS chapter 70;

(e) A cooperative organized or authorized to transact business under ORS chapter 62, provided that the cooperative is not organized as a nonprofit cooperative; or

(f) A sole proprietorship or other person carrying on, conducting or transacting business under an assumed business name registered under ORS chapter 648.

(7) “Business” does not include a nonprofit corporation, nonprofit cooperative, charitable organization, public body, governmental entity, or any entity organized primarily for a nonprofit purpose.

(8) “Department” means the Oregon Business Development Department.

(9) “Headquarters” means the physical location where the Business’s primary executive, administrative, or management functions are directed or controlled. A registered agent address, mailing address, mail forwarding service, commercial mail receiving agency, or virtual office alone does not alone constitute a Headquarters.

(10) “Importer of Record” means the person or entity legally responsible for an imported shipment under U.S. Customs and Border Protection regulations, including the entity named on CBP Form 7501 or on a carrier-issued customs invoice as responsible for the shipment. For purposes of these rules, a Business that paid Additional Tariff Duties directly to an express carrier as an end recipient of an informal entry shipment is treated as the functional equivalent of an Importer of Record.

(11) “Principal Operations” means the primary physical location or locations where the Business conducts substantial business activities related to the goods or services that generate the Business’s Annual Sales. Substantial business activities may include, but are not limited to, producing, assembling, storing, shipping, importing, selling, or distributing goods; providing services; fulfilling customer orders; maintaining inventory, equipment, or operational records; or directing and managing the Business’s operations. A registered agent address, mailing address, mail forwarding service, commercial mail receiving agency, or virtual office alone is not sufficient to establish that a Business has Principal Operations in Oregon.

(12) “Qualifying Documentation” means customs entry documentation that itemizes Additional Tariff Duties paid by tariff type, including but not limited to CBP Form 7501 Entry Summary documents and carrier-issued customs invoices from express carriers. The Department may, in its discretion, accept other documentation that it determines provides equivalent evidence of Additional Tariff Duties assessed or paid.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027

Or. Admin. R. 123-710-0020 Temporary rule language in effect until 02/21/2027. Eligibility

(1) A Business is eligible for a Program grant if:

(a) The Business’s Headquarters or Principal Operations are located in Oregon;

(b) The Business is actively registered to do business in the state of Oregon with the Oregon Secretary of State and has been registered for at least two years as of March 30, 2026;

(d) The Business imported goods into the United States between April 2, 2025, and the Program application deadline, and was either:

(A) listed as the Importer of Record on at least one customs entry during that period; or

(B) an end recipient that paid Additional Tariff Duties directly to an express carrier as part of customs clearance on imported goods during that period; and

(e) The Business paid Additional Tariff Duties.

(2) Eligibility does not guarantee that an applicant will receive a grant.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027

Or. Admin. R. 123-710-0030 Temporary rule language in effect until 02/21/2027. Grant Awards

Grant amounts will be the lesser of 70% of the Attested Tariff Amount or $10,000.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027

Or. Admin. R. 123-710-0040 Temporary rule language in effect until 02/21/2027. Application Process

(1) The Department will only accept applications during the Application Period. The Department will announce the Application Period in advance of the opening date. Applications submitted after the close of the Application Period will not be accepted.

(2) An Authorized Representative for each Business applying for a grant must submit a complete application on the form provided by the Department during the Application Period. The application must identify the approximate number of customs entries or shipments to which the Attested Tariff Amount applies. As part of the application, Businesses will be required to certify the following:

(a) That the total amount of Additional Tariff Duties reported in the application as assessed or paid on imports during the Eligible Period is true and accurate to the best of the Authorized Representative’s knowledge;

(b) That the Business is Headquartered in Oregon or has its Principal Operations in Oregon;

(d) That the Business imported goods into the United States between April 2, 2025, and the Program application date deadline;

(e) That the information provided in the application is true, correct, and complete to the best of the Authorized Representative’s knowledge, and the Authorized Representative is authorized to submit the application on behalf of the Business; and

(f) That the Authorized Representative understands that submission of a false, fraudulent, or materially inaccurate information may result in disqualification, recovery of any grant issued, and referral for civil or criminal prosecution under applicable state or federal law.

(3) After the close of the Application Period, the Department will review all submitted applications for eligibility. Applications that are incomplete or not eligible will be rejected. The Department will notify rejected applicants.

(4) All complete and eligible applications will be entered into a lottery pool, which will be administered according to OAR 123-710-0050.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027

Or. Admin. R. 123-710-0050 Temporary rule language in effect until 02/21/2027. Grant Award Lottery Protocol

(1) All eligible applicants will be assigned a unique identifier and entered into a randomized lottery. The order in which applications were received does not affect an applicant’s position in the lottery.

(2) The Department will conduct a single randomized drawing of all eligible applicants that produces a sequentially ranked list. The ranked list determines the order in which applicants are selected and processed for grant awards.

(3) The Department will advance through the ranked list in sequential order to select applicants for Program grants. The Department will cease advancing through the ranked list when the remaining available Program funds are insufficient to issue a minimum grant to the next ranked applicant, or when the eligible applicant pool is depleted, whichever occurs first.

(4) The Department will provide selected applicants with a notice of intent to award. The notice of intent to award will include, at a minimum:

(a) the amount of the conditional grant award; and

(b) a list of required documents and information that the applicant must provide prior to receiving a grant award. Required documents and information may include, but are not limited to:

(A) banking information necessary to make the grant;

(B) Qualifying Documentation as defined in OAR 123-710-0010; and

(C) any other documents or information the Department deems necessary to verify eligibility, confirm the grant amount, or to ensure the integrity of the Program.

(5) Applicants will have 30 business days to produce any required documents and information. The Department may extend this period at its discretion.

(6) The Department will require documentation and information in the notice of intent to award if:

(a) The application contains inconsistent or unclear information;

(b) The Attested Tariff Amount that requires additional support based on the Annual Sales, number of entries or shipments, or other information provided in the application;

(d) The Department determines that documentation or is needed to verify eligibility, calculate the grant amount, or protect Program integrity.

(7) The Department will disqualify applicants that do not timely submit the required documents or information requested in the notice of intent to award; if the Department determines that the applicant is not eligible; if the Department determines that the applicants submitted false, inaccurate, or materially misleading information; or if the Department finds that to make the grant may impair the integrity of the award process or that such disqualification is in the best interest of the Department.

(8) If an applicant is disqualified, the unawarded amount remains in the available Program funds pool and the Department will advance to the next ranked applicant on the list.

(9) Applicants not reached before pool exhaustion under subsection (3) will be notified that Program funds have been exhausted. Non-selected applicants are not entitled to a grant and have no claim against remaining or returned funds.

History

Statutory/Other Authority: Oregon Laws 2026, Chapter 39
Statutes/Other Implemented: Oregon Laws 2026, Chapter 39
OBDD 18-2026, temporary adopt filed 08/26/2026, effective 08/26/2026 through 02/21/2027