WORK SESSION: SB 362, SB 858, SB 313

 

TAPES 95-96, A-B

 

SENATE REVENUE COMMITTEE

April 16, 2003†† 1:00 PM†† STATE CAPITOL BUILDING

 

Members Present:††††††††††† ††††††††††† Senator Ryan Deckert, Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Ted Ferrioli, Vice Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Tony Corcoran

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Lenn Hannon

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Charlie Ringo

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Bruce Starr

 

Witnesses Present:††††††††††† ††††††††††† Veronica Rinard, Oregon Film and Video Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Dexter Johnson, Legislative Counsel†††††††††††

††††††††††††††††††††††† ††††††††††† ††††††††††† Scott Gibson, Oregon Council for Knowledge and Economic Development†††††

 

Staff Present:††† ††††††††††† ††††††††††† Paul Warner, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Mazen Malik, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Lizbeth Martin-Mahar, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Tara Lantz, Committee Assistant

 

TAPE 95, SIDE A

 

003

Chair Deckert

Calls meeting to order at 1:07pm.

 

OPENS WORK SESSION ON SB 858

 

075

Mazen Malik

Explains SB 858, which reduces the minimum investment level and permits modification of employment level required to qualify for enterprise zone property tax exemption and the -1 amendments, which increases the investment limit to $20 million and deletes the refund for paid taxes.

 

 

 

100

Sen. Ringo

MOTION: MOVES SB 858-1 AMENDMENTS DATED 3/6/03 BE ADOPTED.

 

 

 

103

Sen. Deckert

ORDER: HEARING NO OBJECTION, MOTION PASSES: 5-0-1. SENATOR EXCUSED: STARR.

 

 

 

105

Sen. Ringo

MOTION: MOVES SB 858 TO THE SENATE FLOOR WITH A DO PASS AS AMENDED RECOMMENDATION.

 

 

 

107

Sen. Corcoran

Discusses concerns by labor over the bill.

 

 

 

125

Sen. Hannon

Explains why he is a no vote.

 

 

 

135

Sen. Deckert

ORDER: ROLL CALL VOTE: MOTION PASSES: 5-1-0.

SENATORS ANSWERING AYE: CORCORAN, RINGO, STARR, FERRIOLI, DECKERT. SENATORS ANSWERING NO: HANNON

Sen. Winters will carry the bill on the Senate Floor.

 

CLOSES WORK SESSION ON SB 858

 

OPENS WORK SESSION ON SB 313

 

147

Sen. Deckert

Explains that SB 313 has been used as a vehicle for the film industry.

 

 

 

152

Paul Warner

Explains SB 313, which is an alternative to SB 79 and would allow people to purchase tax credits and then make a donation into the Film Development Fund to be used to offset the cost of production in Oregon.

 

 

 

175

Veronica Rinard

Explains that they are looking at tax credits as an alternative to using general fund money and why they do not just give tax credits to production companies. Explains the process of selling tax credits and issues with it. Discusses other states incentives. States that this is her second choice.

 

 

 

279

Warner

Explains the revenue impact of SB 313.

 

Discussion follows.

 

 

 

310

Sen. Ringo

Asks what other states use as a revenue source.

 

 

 

315

Rinard

Responds that most other states use general funds or lottery funds and use it as an economic development program.

 

 

 

327

Sen. Ringo

Asks what the problem was with SB 79.

 

 

 

335

Rinard

Responds that it would be difficult to take money from the general fund in this budget time.

 

 

 

353

Sen. Deckert

States that SB 79 needs to go to Ways and Means and this is the proposal to keep a bill from going there.

 

 

 

356

Sen. Ringo

Asks about retaining a tax credit marketer.

 

 

 

359

Rinard

Responds that one requirement is that they have to obtain a tax credit marketer and that she would change the language to just a marketer.

 

 

 

368

Sen. Ringo

Asks what the transaction costs are there with the tax credits.

 

 

 

373

Rinard

Responds that it depends on whether the federal government decides to label the purchase of tax credits as a charitable donation and discusses the costs of a tax credit marketer.

 

 

 

390

Sen. Ringo

Asks if there is a case pending on the federal issue.

 

TAPE 96, SIDE A

 

CLOSES WORK SESSION ON SB 313

 

OPENS WORK SESSION ON SB 362

 

003

Scott Gibson

Explains the intent of SB 362 of providing an incentive only for people who would move from out of the state and invest in Oregon. States that only two people in Oregon would qualify and that he could get letters from them saying they would not try to obtain the credit. Discusses the -2 amendments, which tighten the language and make it more difficult to qualify.

 

 

 

033

Sen. Starr

MOTION: MOVES SB 362-2 AMENDMENTS DATED 4/15/03 BE ADOPTED.

 

 

 

037

Sen. Deckert

ORDER: HEARING NO OBJECTION, MOTION PASSES: 5-0-1. SENATOR EXCUSED: CORCORAN.

 

 

 

040

Sen. Starr

MOTION: MOVES SB 362 TO THE SENATE FLOOR WITH A DO PASS AS AMENDED RECOMMENDATION.

 

 

 

043

Sen. Hannon

States that in these economic times he cannot vote for a bill to give tax breaks.

 

 

 

052

Gibson

Reiterates that only two people in Oregon would qualify for the credit and that it would only bring revenues in.

 

Discussion follows.

 

 

 

080

Sen. Ferrioli

States that he would like to have the letters from the two qualified Oregon capital venture firms that they would not be applying for this incentive before the bill is moved.

 

 

 

090

Sen. Deckert

States that he feels comfortable moving the bill forward and obtaining the letters for the floor speech.

 

 

 

100

Sen. Ferrioli

States that he supports the concept but doesnít see any reason why they canít wait a day or two to move the bill forward.

 

 

 

109

Sen. Deckert

Responds that they will hold the bill for a couple of days.

 

CLOSES WORK SESSION ON SB 362

 

OPENS WORK SESSION ON SB 313

 

116

Dexter Johnson

Discusses the process at the state and federal level to determine whether purchasing tax credits could be used as a charitable donation.

 

 

 

144

Sen. Ringo

Asks if a child care contribution could be looked upon differently than one for film.

 

 

 

147

Johnson

Responds that it is a contribution to a state agent and it would not matter.

 

 

 

150

Sen. Ferrioli

Asks if a disconnect from the federal code would affect this.

 

 

 

159

Johnson

Responds that there is specific language in the child care division tax credit that deals with that question and that the changes are legislative changes so the question of connect and disconnect does not arise.

 

 

 

169

Sen. Deckert

States that they will bring the bill back next week.

 

 

 

174

Rinard

Responds that they will do further research and discusses problems with SB 313.

 

CLOSES WORK SESSION ON SB 313

 

190

Sen. Deckert

Adjourns meeting at 1:49pm.

 

 

 

Tape Log Submitted by,

 

 

 

Tara Lantz, Committee Assistant

 

Exhibit Summary:

1.      SB 858, Mazen Malik, Staff Measure Summary, 1p.

2.      SB 858, Mazen Malik, Revenue Impact Statement, 1p.

3.      SB 858, Betsy Earls, Written Testimony, 1p.

4.      SB 313, Paul Warner, Proposed SB 313-1 Amendments, 4pp.

5.      SB 313, Veronica Rinard, Written Testimony, 4pp.

6.      SB 313, Williamson-Smith, Written Testimony, 1p.

7.      SB 362, Lizbeth Martin-Mahar, Proposed SB 362-2 Amendments, 8pp.

8.      SB 362, Lizbeth Martin-Mahar, Staff Measure Summary, 2pp.

9.      SB 362, Lizbeth Martin-Mahar, Revenue Impact Statement, 1p.