Monday, January 5, 2009

Oregon exceptionally generous with green-energy subsidies

Back in June '07 we posted '"free money" for Oregon business owners who invest in solar.":
That headline is a quote, I couldn't make it up. This either: In many cases, the incentives and credits paid end up being more than the actual cost of the system.

Alrighty then, time to hit the Oregon Trail.
From The Oregonian:

Oregon taxpayers are shelling out tens of millions of dollars to subsidize green energy projects, making the state a magnet for solar and wind companies.

But an investigation by The Oregonian shows that the money also is going to risky ventures with questionable environmental benefits and to prosperous companies that need no incentives but are cashing in anyway.

When the Legislature convenes next week, Gov. Ted Kulongoski will call on lawmakers to raise taxes and fees as the state plunges deeper into recession.

At the same time, he will push to expand tax breaks for businesses -- tax breaks that will cost the state at least $140 million over the next two years, a cost he says is necessary to make Oregon a sustainability model for the nation....

...Even banks and big corporations that have nothing to do with renewable energy are grabbing the tax breaks. Under the state's generous incentives, groups and companies that qualify for tax credits can turn around and sell them. Most do. Standard Insurance, for example, paid $2.5 million to Flakeboard, an Albany mill that makes composite wood. In exchange, Standard gets to use $3.5 million in tax credits the mill received for building a wood-burning boiler that can generate electricity.

Lawmakers alarmed

The energy credit is just one of hundreds of tax breaks allowed by Oregon -- a list that includes popular deductions such as home mortgages and medical expenses for the elderly. Unlike tax deductions, however, tax credits are far more attractive because they directly reduce a tax bill -- every dollar of credit is a dollar saved on taxes.

Rapid growth in the amount and size of the tax credits has alarmed some lawmakers and advocacy groups that see the state reducing services to the poor while handing out huge sums to often wealthy businesses. Furthermore, they say, the state is using its precious general fund dollars to pay private companies for projects that help them make a bigger profit.

"My concern is, it's going to be loved to death," says state Sen. Ginny Burdick, D-Portland, who chairs the Senate Revenue Committee. "Are we getting our money's worth as taxpayers? Or are we simply doling out money to people who would be doing what they're doing anyway?">>>MORE