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The Oregon Administrative Rules contain OARs filed through November 15, 2014
 
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DEPARTMENT OF ENVIRONMENTAL QUALITY

 

DIVISION 180

UNDERGROUND STORAGE TANK LOAN GUARANTEE
AND INTEREST RATE SUBSIDY PROGRAM

340-180-0005

Authority, Purpose, and Scope

(1) These rules are promulgated in accordance with and under the authority of ORS 466.706 through 466.835 and ORS 466.895 through 466.995 as amended by Chapter 1071, Oregon Laws, 1989 (House Bill 3080) and Chapter 863, Oregon Laws, 1991 (Senate Bill 1215).

(2) The purpose of these rules is to provide for the regulation of:

(a) Persons who receive guaranteed loans for soil remedi-ation, upgrading of underground storage tanks, and replacement of underground storage tanks where the underground storage tanks contain motor fuel and are regulated by ORS 466.706 through 466.835 and ORS 466.895 through 466.995; to provide assistance to owners of underground storage tanks in meeting Environmental Protection Agency requirements and obtaining financial responsibility coverage; and

(b) Commercial lending institutions who issue guaranteed underground storage tank loans.

(3) These rules establish requirements and standards for:

(a) Loan guarantees of up to 80 percent of the loan principal not to exceed $64,000 for UST upgrading, UST replacement, and soil remediation;

(b) Applying and qualifying for a guaranteed loan through a commercial lending institution;

(c) Loan interest rates;

(d) Applying and qualifying for interest rate subsidies to commercial lending institutions;

(e) Loan default; and

(f) Administration and enforcement of these rules by the Department.

(4) Scope:

(a) OAR 340-180-0005 through 340-180-0080 applies to persons who receive loan guarantee certificates and loan guarantees for soil remediation, underground storage tank upgrading, and underground storage tank replacement;

(b) OAR 340-180-0090 through 340-180-0110 applies to persons who receive tax credit certificates and loan interest rate subsidies on loans for soil remediation, underground storage tank upgrading, and underground storage tank replacement;

(c) OAR 340-180-0120 applies to persons seeking a written notice of compliance from the Department for soil remediation.

Stat. Auth.: ORS 466.706 - ORS 466.895 & ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90; DEQ 29-1991(Temp), f. 12-18-91, cert. ef. 12-20-91; DEQ 14-1992, f. & cert. ef. 6-11-92

 

340-180-0010

Definitions

As used in these rules:

(1) "Collection Expenses" means out of pocket expenses, attorney fees, administrative expenses, filing fees, recording fees, and other expenses.

(2) "Commercial Lending Institution" means any bank, mortgage banking company, trust company, stock savings bank, saving and loan association, credit union, national banking association, federal savings and loan association or federal credit union maintaining an office in this state.

(3) "Commission" means the Environmental Quality Commission.

(4) "Corrective Action" means remedial action taken to protect the present or future public health, safety, welfare, or the environment from a release of a regulated substance. "Corrective action" includes but is not limited to:

(a) The prevention, elimination, removal, abatement, control, minimization, investigation, assessment, evaluation or monitoring of a hazard or potential hazard or threat, including migration of a regulated substance; or

(b) Transportation, storage, treatment or disposal of a regulated substance or contaminated material from a site.

(5) "Department" means the Department of Environmental Quality.

(6) "Director" means the Director of the Department of Environmental Quality.

(7) "Facility" means any one or combination of underground storage tanks and underground pipes connected to the tanks, used to contain an accumulation of motor fuel, including gasoline or diesel oil, that are located at one contiguous geographical site.

(8) "Firm" means any business, including but not limited to corporations, limited partnerships, and sole proprietorships, engaged in the performance of tank services.

(9) "Grant" means reimbursement for costs incurred for UST tightness testing and soil assessment at a facility with underground storage tanks containing motor fuel.

(10) "Investigation" means monitoring, surveying, testing or other information gathering.

(11) "Licensed" means that a firm or an individual with supervisory responsibility for the performance of tank services has met the Department's experience and qualification requirements to offer or perform services related to underground storage tanks and has been issued a license by the Department to perform those services.

(12) "Local Unit of Government" means a city, county, special service district, metropolitan service district created under ORS Chapter 268 or political subdivision of the state.

(13) "Motor Fuel" means a petroleum or a petroleum-based substance that is a motor gasoline, aviation gasoline, No. 1 or 2 diesel fuel, or any grade of gasohol, and is typically used in the operation of a motor engine.

(14) "Owner" means the owner of an underground storage tank.

(15) "Permittee" means the owner or a person designated by the owner who is in control of or has responsibility for the daily operation or daily maintenance of an underground storage tank under a permit issued pursuant to these rules.

(16) "Property Owner" means the legal owner of the property where the underground storage tank resides.

(17) "Release" means the discharge, deposit, injection, dumping, spilling, emitting, leaking or placing of a regulated substance from an underground storage tank into the air or into or on land or the waters of the state, other than as authorized by a permit issued under state or federal law.

(18) "Soil Assessment" means evaluating the soil adjacent to the UST system for contamination from motor fuel.

(19) "Soil Remediation" means those corrective actions taken to excavate, remove, treat or dispose of soil contaminated with motor fuel so as to bring a site containing underground storage tanks into compliance with the Department's Cleanup Rules for Leaking Petroleum UST System, OAR Chapter 340, Division 122.

NOTE: Soil remediation does not include cleanup or decontamination of contaminated groundwater or surface water, provisions for alternate water supplies or any related remediation work.

(20) "Supervisor" means a licensed individual operating alone or employed by a contractor and charged with the responsibility to direct and oversee the performance of tank services at a underground storage tank facility.

(21) "Tank Services" include but are not limited to tank installation, decommissioning, retrofitting, testing, and inspection.

(22) "Tank Services Provider" is an individual or firm registered and, if required, licensed to offer or perform tank services on regulated underground storage tanks in Oregon.

(23) "Tightness Testing" means a procedure for testing the ability of a tank system to prevent an inadvertent release of any stored substance into the environment (or, in the case of an underground storage tank system, intrusion of groundwater into a tank system).

(24) "Underground Storage Tank" or "UST" means an underground storage tank as defined in OAR Chapter 340, Division 150.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: ORS 466.706 & OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0020

Distribution Priority of Funds for Loan Guarantee Expenses

(1) A portion of the funds in the Underground Storage Tank Compliance and Corrective Action Fund during each individual month shall be assigned by the Department to pay for the expenses of providing loan guarantees to commercial lending institutions for loans that fund soil remediation, UST upgrading, and UST replacement at facilities that contain an accumulation of motor fuel. Loan guarantees shall be approved giving first priority to earliest received complete application then giving priority in accordance with the numerical ranking system described in this section.

(2) In order to determine the numerical ranking, the loan application must first be evaluated by:

(a) Assigning a numerical score to each of the parameters in section (4) of this rule; and

(b) Totaling the parameter scores to arrive at the Total Score.

(3) The Total Score shall then be used to establish priority categories for providing funds to loan guarantee applications. Priority categories shall be established where a Total Score of 30 points or greater is an "A" category, a Total Score of 16 points but less than 30 points is a "B" category, and a Total Score less than 16 points is a "C" category.

NOTE: A facility must retail motor fuel to receive points in some of the following numerical parameters. To be considered "retail", a motor fuel facility must sell motor fuel to the general public. For the purposes of these rules a wholesale cardlock or keylock fueling facility is not considered a retail facility.

(4) Numerical parameters are:

(a) For construction work to upgrade or replace USTs containing motor fuel at a facility:

(A) Assign ten points for total construction costs less than $40,000;

(B) Assign eight points for total construction costs of $40,000 through $59,999;

(C) Assign six points for total construction costs of $60,000 through $79,999;

(D) Assign four points for total construction costs of $80,000 through $99,999;

(E) Assign two points for total construction costs of $100,000 or more.

(b) For a facility that retails motor fuel:

(A) Assign ten points where no more than two other facilities that retail motor fuel are within 30 road miles;

(B) Assign eight points where no more than two other facilities that retail motor fuel are within 25 road miles;

(C) Assign six points where no more than two other facilities that retail motor fuel are within 20 road miles;

(D) Assign four points where no more than two other facilities that retail motor fuel are within 15 road miles;

(E) Assign two points where no more than two other facilities that retail motor fuel are within ten road miles.

(c) For facilities that retail motor fuel within an incorporated city:

(A) Assign ten points for a facility located within a city with a population under 2,000;

(B) Assign eight points for a facility located within a city with a population of 2,000 through 4,999;

(C) Assign six points for a facility located within a city with a population of 5,000 through 9,999;

(D) Assign four points for a facility located within a city with a population of 10,000 through 19,999;

(E) Assign two points for a facility located within a city with a population of 20,000 and greater.

(d) For facilities that retail motor fuel located outside an incorporated city:

(A) Assign ten points for a facility located outside of an incorporated city and east of the Cascade mountain range summit including all of Hood River and Klamath counties;

(B) Assign eight points for a facility located outside of an incorporated city and west of the Coast mountain range summit including all of Columbia, Coos, Curry, and Tillamook counties;

(C) Assign six points for a facility located outside of an incorporated city, east of the Coast mountain range summit, and west of the Cascade mountain range summit within Benton, Douglas, Jackson, Josephine, Lane, Linn, Marion, Polk, and Yamhill counties;

(D) Assign four points for a facility located outside of an incorporated city, east of the Coast mountain range summit, west of the Cascade mountain range summit, and outside of the Portland Metropolitan Service District within Clackamas, Multnomah and Washington counties;

(E) Assign two points for a facility located outside of an incorporated city and within the Portland Metropolitan Service District.

(e) Annual motor fuel throughput at a facility in gallons:

(A) Assign ten points where the throughput is less than 100,000 gallons;

(B) Assign eight points where the throughput is 100,000 through 199,999 gallons;

(C) Assign six points where the throughput is 200,000 through 299,999 gallons;

(D) Assign four points where the throughput is 300,000 through 399,999 gallons;

(E) Assign two points where the throughput is 400,000 gallons and greater.

(f) For a retail motor fuel facility:

(A) Assign ten points where the previous two year average annual gross sales receipts are less than $250,000;

(B) Assign eight points where the previous two year average annual gross sales receipts are $250,000 through $499,999;

(C) Assign six points where the previous two year average annual gross sales receipts are $500,000 through $749,999;

(D) Assign four points where the previous two year average annual gross sales receipts are $750,000 through $999,999;

(E) Assign two points where the previous two year average annual gross sales receipts are $1,000,000 or greater.

NOTE: Provide documentation for the gross sales receipts from all income sources at the facility. If the facility is less than two years old or the business records are not available for the past two years, the applicant may provide other documentation to establish the two year average annual gross sales receipts.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0030

General Provisions Guaranteed Underground Storage Tank Facility Loan

(1) Property owners, tank owners, and permittees of a UST facility that contains motor fuel may qualify to receive a guaranteed loan for soil remediation, UST upgrading, and UST replacement.

(2) The applicant for a guaranteed loan shall provide a minimum down payment of 20 percent.

(3) The guaranteed loan must be issued by a commercial lending institution.

(4) The loan guarantee provided by the Department may be up to 80 percent of the loan principal, not to exceed $64,000 at any facility location.

NOTE: For example, for a $50,000 UST project, the applicant must provide a minimum 20 percent down payment ($10,000), the commercial lending institution may loan the remaining 80 percent ($40,000), and the Department may only guarantee 80 percent of the amount of money loaned. In this case the loan guarantee would be $32,000.

(5) Loan guarantees shall be issued in a priority order, in accordance with OAR 340-180-0020 and 340-180-0060.

(6) Only one loan guarantee may be issued to each facility.

(7) The loan guarantee is limited to work for soil remediation at a facility where USTs contain motor fuel and work to upgrade or replace the underground storage tank systems containing an accumulation of motor fuel located at a facility where:

(a) The USTs are regulated by OAR Chapter 340, Division 150;

(b) UST system upgrading, retrofitting and replacement is performed by licensed service providers in accordance with OAR 340-160-0005 through 340-160-0150;

(c) UST tightness testing and/or soil assessment was performed prior to issuance of a loan guarantee;

(d) Performance of UST tightness testing and/or soil assessment was in accordance with OAR 340-170-0010 through 340-170-0080;

(e) Each regulated underground storage tank has a valid UST permit; and

(f) Work started after September 1, 1989 and is completed by August 31.

(8) Loan guarantees are not available to pay for soil remediation at a facility undergoing decommissioning, including tank removal or where tanks are being filled in place.

(9) Money from a loan guaranteed by the Department shall only be used for labor, material and equipment listed on the Department published eligible expense list.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0040

Application for Underground Storage Tank Loan Guarantee Certificate

(1) Any person wishing to apply for a loan guarantee certificate for an underground storage tank loan shall submit a written application on a form provided by the Department. Applications shall be submitted within 180 days after completion of the UST tightness testing and/or soil assessment. All applications must be complete.

(2) Applications which are unsigned or which do not contain the required exhibits (clearly identified) will not be accepted by the Department and will be promptly returned to the applicant for completion. The application will not be considered complete until the requested information is received. The application will be considered to be withdrawn if the applicant fails to submit the requested information within 180 days of the request.

(3) Applications which are complete will be accepted by the Department for processing.

(4) Within 30 days after the application is determined complete, the Department will:

(a) Assign a priority category; and

(b) Establish a loan guarantee amount.

(5) If, upon review of an application, the Department determines that the loan guarantee application does not meet the requirements of the statutes and rules, the Department shall notify the applicant in writing of this determination. Such notification shall constitute final action by the

Department on this application.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0050

Information Required on the UST Loan Guarantee Certificate Application

(1) The underground storage tank loan guarantee certificate application shall include:

(a) Name, mailing address and telephone number of the applicant;

(b) Name, mailing address and telephone number of the property owner, UST owner, and the permittee;

(c) Signatures of the applicant, the property owner, the UST owner, and the permittee;

(d) UST facility name and location;

(e) UST permit numbers;

(f) Date of the application;

(g) Description of work at the UST facility including:

(A) Description of the work area including a sketch showing, but not limited to, property boundaries, location of structures, location and identification of the underground storage tanks containing an accumulation of motor fuel;

(B) Description of tank upgrade or replacement items and activities, including those items and activities that are not part of a UST system but are required because of construction interference.

NOTE: Work qualifying for the loan guarantee certificate includes:

-1- Modification, replacement, and installation of any portion of the UST system containing motor fuel including replacement of paving and structures located immediately over the UST systems and are required to be removed and replaced due to work on the UST systems.

-2- Replacement of an underground storage tank system with an above ground storage tank system that meets existing state and local codes.

-3- Installation of the underground portion of any required Stage I vapor recovery system or anticipated future Stage II vapor recovery system.

-4- Soil remediation for soil contaminated with motor fuel including replacing excavated soil, paving and structures that are required to be removed during soil remediation.

(h) Total project cost in the form of a bid, estimate, or paid invoices from a licensed UST service provider, identifying those items that qualify for the loan guarantee certification described by these rules.

NOTE: The total project cost will affect the priority for the loan guarantee application and the amount of the guarantee. The Department recommends that the applicant obtain three bids or estimates to identify an accurate total project cost. Where construction is completed prior to applying for a loan guarantee certificate the applicant may document project costs with paid invoices.

(i) A copy of the soil assessment and UST tightness testing Notice of Compliance from the Department; and

(j) The information required to determine the priority category for the facility:

(A) County;

(B) Location of the facility east or west of the summits of the Coast and Cascade mountain ranges;

(C) City and city population as shown in the current Oregon Blue Book, if the facility is located within an incorporated city;

(D) Location of the facility inside or outside of the Portland Metropolitan Service District;

(E) Distance to nearest two facilities that retail motor fuel, in the shortest highway miles;

(F) Gallons of motor fuel throughput during the last 12 months;

(G) Annual gross sales receipts for previous two years for the business conducted at the facility;

(H) Annual revenue receipts for previous two years for any nonprofit or governmental entity; and

(I) Type of business at the facility including SIC code.

(2) The Department shall have access to books, documents, papers and records held by the applicant which are directly pertinent to qualifying for the loan guarantee certificate for the purpose of making audit, examination, excerpts and transcripts. The applicant shall maintain these records for three years after the initial loan date.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0060

Loan Guarantee Certificate

(1) In accordance with this part, the Department shall issue a loan guarantee certificate to an applicant who has filed a complete application.

(2) At the beginning of each month the Department shall determine the portion of the funds in the Underground Storage Tank Compliance and Corrective Action Fund that shall be used for the expenses of approved loan guarantee applications during the month. The portion dedicated to the loan guarantee expenses shall be distributed in the following manner:

(a) Sixty percent of the month funds shall be set aside for the expenses of category "A" loan guarantees;

(b) Thirty percent of the month funds shall be set aside for the expenses of category "B" loan guarantees;

(c) Ten percent of the month funds shall be set aside for the expenses of category "C" loan guarantees;

(d) Funds set aside within a category during any month shall be used to provide loan guarantee certificates for loan applications received during the previous month, first providing loan guarantee certificates to applications with the highest numerical ranking within the category, then to applications with the next highest numerical ranking within the category, and so on in numerical order, except:

(A) Within a category, any loan guarantee application not receiving a loan guarantee certificate during a month shall receive a loan guarantee certificate before any new application received during any subsequent month;

(B) Where loan applications have the same numerical ranking, the loan application with the earliest filing date shall receive a loan guarantee certificate first.

(e) At the end of the month, funds not used to provide loan guarantee certificates shall be added to the funds the Department makes available during the next month;

(f) Loan guarantee applications within a category that do not receive a loan guarantee certificate within the current month shall be funded first in time and in priority order within that category during the following month, and so on in subsequent months.

(3) The loan applicant may not assign any right, title, and interest in the loan guarantee certificate or the loan guarantee to any person other than a subsequent property owner, tank owner or permittee of the underground storage tank facility.

(4) Loan guarantee certificates shall be valid for 180 days or the termination date shown on the loan guarantee certificate.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0070

Loan Guarantee

(1) The Department shall issue a loan guarantee, not to exceed the lesser of 80 percent of the loan principal or $64,000, to a commercial lending institution for a loan to provide soil remediation, UST upgrading, and replacement of USTs at a facility containing motor fuel where:

(a) A loan guarantee certificate has been issued to the loan applicant;

(b) The loan guarantee does not provide a guarantee for work other than approved work authorized in OAR 340-180-0050;

(c) The loan is amortized with equal payments over the term of the loan where the interest rate is fixed, or with equal principal payments over the term of the loan where the interest rate is variable.

NOTE: To assure that funds are available from the UST Compliance and Corrective Action Fund (USTCCAF) to pay loan guarantees during the life of the loan, it is necessary for most loans to have equal payments over the term of the loan. The Department, however, recognizes that the lending policies may differ between commercial lending institutions and may differ between individual loans, particularly during construction. The Department expects that equal loan payments will start after construction is complete. The Department is willing to consider other loan arrangements and other loan repayment schedules subsequent to the initial loan, such as multiple loans and loan refinancing where USTCCAF monies are available to pay loan guarantees, upon default, in full. Each new loan arrangement may be approved by the Department on a case by case basis. The final maturity date of the loan may not exceed ten years from the initial note date.

(d) The loan maturity date of the loan does not exceed ten years from the initial closing date;

(e) The commercial lending institution has approved the loan, subject to receiving the loan guarantee from the Department; and

(f) The loan applicant or the commercial lending institution has provided the terms of the loan to the Department. The terms of the loan include but are not limited to:

(A) Amount of loan;

(B) Down payment;

(C) Interest rate; and

(D) The term of the loan from the initial note date.

(2) The loan guarantee shall terminate on the first to occur of:

(a) Thirty days after loan maturity date, including all extensions or renewals or extensions caused by the Department under OAR 340-180-0080(2)(b).

NOTE: For example, if the initial note has a five year maturity date it's maturity date may be extended beyond five years, but not past ten years. The loan guarantee will terminate 30 days after the new maturity date. All of the above rules apply to any extension of the maturity date.

(b) Upon payment of the loan guarantee to the commercial lending institution; or

(c) When the loan guarantee provided by the Department is replaced by a loan guarantee provided by the U.S. Small Business Administration (SBA).

(3) The commercial lending institution shall notify the Department promptly when a loan guaranteed by the Department is paid in full or replaced with a S.B.A. loan guarantee.

(4) The payment of the loan guarantee is subject to monies being allocated and being available from the Underground Storage Tank Compliance and Corrective Action Fund.

NOTE: The funds available for payment of loan guarantees upon loan default is estimated to be $1,375,000, where 20 percent of the loans default during the life of the program. The Department expects to provide $13,752,000 in loan guarantees for approximately 245 loans, where the Department provides the guarantee throughout the life of the loan. It is expected that the SBA (U.S. Small Business Administration) will agree to provide their loan guarantee (takeout the loan) after the soil cleanup and UST construction work is complete, approximately six months after the Department issued the original loan guarantee The Department encourages transfer of loan guarantees to the SBA or to conventional financing in order to increase the number of loan guarantees provided by the Department.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0080

Notice of Default on a Guaranteed Loan

(1) Any commercial leading institution wishing to obtain payment from the Department under the Department's loan guarantee shall provide the following:

(a) Written notice from the commercial lending institution in the form of a demand for payment of the loan guarantee, stating:

(A) The guaranteed loan to the borrower is in default;

(B) The commercial lending institution has made a good faith effort to work with the borrower, using the institution's established procedures, to bring the loan back into good standing;

(C) Demand for payment in full has been made to the borrower by the commercial lending institution; and

(D) The borrower has not paid the loan in full.

(b) The demand for payment of the loan guarantee shall include:

(A) A copy of the demand letter to the borrower from the commercial lending institution; and

(B) A statement showing the principal balance outstanding on the date the demand letter was sent to the borrower.

(2) Subject to the availability of funds from the Underground Storage Tank Compliance and Corrective Action Fund, the Department shall, within 30 days after receipt of the default notice:

(a) Pay to the commercial lending institution the lesser of:

(A) The amount guaranteed by the Department; or

(B) The principal balance outstanding on the date the commercial lending institution sent the default notice to the Department; or

(b) Where agreed upon by the commercial lending institution and where the borrower is unable to pay, the Department may make partial principal payments of the loan guarantee equal to the monthly loan principal payment for up to twelve monthly loan payments. If the loan is still in default after the Department has made twelve monthly payments, the Department will pay the loan guarantee, pursuant to subsection (2)(a) of this rule.

(3) If the commercial lending institution receives payment of the loan, in whole or in part, after the date of the default notice, the commercial lending institution shall promptly notify the Department in writing of such payment.

(4) Once the Department has paid the loan guarantee certificate in whole or in part, the commercial lending institution shall reimburse the Department for any collection of the principal portion on the unpaid loan at the guarantee percentage shown on the loan guarantee certificate. The reimbursement shall be in legal tender. The expenses of collection may be deducted from the reimbursement paid to the Department.

(5) The Department understands that collection may consist of cash, securities, notes, personal property, real property or any other form of payment accepted by the commercial lending institution. The reimbursement to the Department shall be after the collection has been converted to legal tender. Payment to the Department by the commercial lending institution shall be made within thirty days after any collection is converted into legal tender.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0090

General Provisions, Interest Rate Subsidy and Tax Credit Certificate

(1) Commercial lending institutions making loans for soil remediation, UST upgrading, and replacement of UST systems containing motor fuel may qualify to receive an Oregon income tax credit.

(2) The Oregon income tax credit may not exceed the difference between the amount of finance charge charged during the taxable year including interest on the loan and interest on any loan fee financed at an annual rate of 7.5 percent and the amount of finance charge that would have been charged by the commercial lending institution during the taxable year, including any interest on the loan and interest on any loan fee financed at an annual rate charged for nonsubsidized loans. For purposes of calculating the income tax credit, the determination of the interest rate charged on a nonsubsidized loan (including any additional notes or replacement notes) shall be calculated by using a fixed annual interest rate equal to three percent above the publicly announced prime rate of interest of either United States National Bank of Oregon or First Interstate Bank of Oregon, N.A. in effect on the date of the initial note. The commercial lending institution shall choose which of the two banks prime rate it uses to make this calculation. The difference in income between the interest rate calculated in this manner and a 7.5 percent interest rate shall be the tax credit due the commercial lending institution.

(3) Income tax credits may be received where:

(a) The borrower pays 7.5 percent fixed interest;

(b) The loan is amortized with equal payments over the term of the loan.

NOTE: To assure that funds are available from the UST Compliance and Corrective Action Fund (USTCCAF) to pay interest rate subsidies during the life of the loan, it is necessary for most loans to have equal payments over the term of the loan. The Department, however, recognizes that the lending policies may differ between commercial lending institutions and may differ between individual loans, particularly during construction. The Department is willing to consider other loan arrangements and other loan repayment schedules subsequent to the initial loan, such as multiple loans and loan refinancing where the interest rate subsidy conserves the USTCCAF monies so that all qualified interest rate subsidies are paid in full. Each new loan arrangement may be approved by the Department on a case by case basis. The final maturity date of the loan may not exceed ten (10) years from the initial note date.

(c) The loan maturity date does not exceed ten years from the initial closing date;

(d) The borrower has received a tax credit certificate for an interest rate subsidy; and

(e) The loan applicant or the commercial lending institution has provided the terms of the loan to the Department. The terms of the loan include but are not limited to:

(A) Amount of loan;

(B) Down payment;

(C) The nonsubsidized rate calculated in section (2) of this rule;

(D) Interest rate; and

(E) The term of the loan from the initial note date.

(4) Only one interest rate subsidy may be issued to each facility.

(5) The interest rate subsidy is limited to loans for work for soil remediation at a facility where USTs contain motor fuel and work to upgrade or replace the underground storage tank systems containing an accumulation of motor fuel located at a facility where:

(a) The USTs are regulated by OAR Chapter 340, Division 150 and 40 CFR 280;

(b) UST system upgrading, retrofitting and replacement is performed by licensed service providers in accordance with OAR 340-160-0005 through 340-160-0150;

(c) UST tightness testing and/or soil assessment was performed prior to application for a loan;

(d) UST tightness testing and soil assessment was performed in accordance with Department regulations;

(e) Each regulated underground storage tank has a valid UST permit; and

(f) The loan is provided by a commercial lending institution.

(6) An Oregon income tax credit may be paid on loans provided by a commercial lending institution that are not guaranteed by the Department where the borrower has received a tax credit certificate from the Department.

(7) The commercial lending institution shall file for the Oregon income tax credit during their regular state income tax filing.

NOTE: The funds available for Oregon tax credits are estimated to total $3,874,000 over the life of the program, providing tax credits for approximately 245 loans. These 245 loans may be the same as or different from the proposed 245 loans guaranteed under OAR 340-180-070. When the Department has issued tax credit certificates that create a demand of approximately $3,874,000 on the UST Compliance and Corrective Action Fund the Department will recommend to the Environmental Quality Commission to set the maximum interest rate on loans at 7.5 percent. Since it is doubtful that any commercial lending institution will issue a 7.5 percent loan, the effective action will be to stop the subsidized interest rate program. The Department believes that this intended action is consistent with the legislative intent to fund the Oregon income tax credit out of the UST Compliance and Corrective Action Fund.

(8) Income tax credits may not be earned by a commercial lending institution after December 31, 1991. The commercial lending institution may file after December 31, 1991 for any Oregon income tax

credits earned before January 1, 1992 under these rules.

(9) This Division only applies to projects for which soil remediation, UST upgrading and UST replacement work started after September 1, 1989 and had received an interest rate subsidy certificate or confirmation letter on or by October 1, 1991.

[Publications: The publication(s) referred to or incorporated by reference in this rule are available from the agency.]

Stat. Auth.: ORS 466.706 - ORS 466.895 & ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90; DEQ 29-1991(Temp), f. 12-18-91, cert. ef. 12-20-91; DEQ 14-1992, f. & cert. ef. 6-11-92

 

340-180-0100

Application for Tax Credit Certificate

(1) Any person wishing to obtain a Tax Credit Certificate for an interest rate subsidy on a loan for soil remediation, UST upgrading, and replacement of UST systems containing motor fuel shall submit a written application on a form provided by the Department.

(2) The underground storage tank loan interest rate subsidy application shall include all information required under OAR 340-180-0050(1)(a) through (j).

(3) Applications which are unsigned or which do not contain the required exhibits (clearly identified) will not be accepted by the Department and will be promptly returned to the applicant for completion. The application will not be considered complete until the requested information is received. The application will be considered to be withdrawn if the applicant fails to submit the requested information within 180 days of the request.

(4) Applications which are complete will be accepted by the Department for processing.

(5) Within 30 days after the application is complete for processing, the Department will approve or deny the issuance of a Tax Credit Certificate.

(6) If, upon review of an application, the Department determines that the application does not meet the requirements of the statutes and rules, the Department shall notify the applicant in writing of this determination. Such notification shall constitute final action by the Department on this application.

NOTE: Work qualifying for the Tax Credit Certificate includes:

-1- Modification, replacement, and installation of any portion of the UST system containing motor fuel including replacement of paving and structures located immediately over the UST systems.

-2- Replacement of an underground storage tank system with an above ground storage tank system that meets existing state and local codes.

-3- Installation of the underground portion of any required Stage I vapor recovery system or anticipated future Stage II vapor recovery system.

-4- Soil remediation for soil contaminated with motor fuel including replacing excavated soil, paving and structures that are required to be removed during soil remediation.

(7) The Department shall have access to books, documents, papers and records held by the applicant which are directly pertinent to qualifying for the tax credit certificate for the purpose of making audit, examination, excerpts and transcripts. The applicant shall maintain these records for three years after the initial loan date.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

340-180-0110

Tax Credit Certificate

(1) In accordance with this part, the Department shall issue a tax credit certificate to an applicant who has filed a complete application.

(2) Funds collected and deposited into the Underground Storage Tank Compliance and Corrective Action Fund may be used to pay this Oregon income tax credit. The Department will pay to the Oregon Department of Revenue, no less than once each quarter year, all valid income tax credits claimed for interest rate reimbursement by the commercial lending institutions against Underground Storage Tank Tax Credit Certificates.

(3) Tax credit certificates shall be issued on a first come first serve basis. The application with the earliest filing date shall receive a tax credit certificate first.

(4) The applicant may not assign any right, title, and interest in the tax credit certificate to any person other than a subsequent property owner, tank owner or permittee of the underground storage tank facility.

(5) Tax credit certificates shall be valid for 180 days or the termination date shown on the tax credit certificate.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

 

340-180-0120

Notice of Compliance for Soil Remediation

(1) A person wishing to obtain a written notice of compliance for soil remediation shall submit a written application on a form provided by the Department. The application shall include:

(a) The name and mailing address of the applicant;

(b) The signature of the applicant;

(c) The UST facility name and location;

(d) The UST permit numbers;

(e) The date of the application;

(f) The completion date of the soil remediation;

(g) Description, including a sketch showing, but not limited to, property boundaries, location of structures, location and identification of tanks including tank contents, and identification of soil assessment sites; and

(h) Findings including, but not limited to, results of laboratory tests, soil matrix calculations, and tank tightness tests.

(2) Applications which are obviously incomplete, unsigned, or which do not contain the required exhibits (clearly identified) will not be accepted by the department and will be returned to the applicant for completion.

(3) Applications which appear complete will be accepted by the department for processing.

(4) Within 30 days after receipt, the Department will determine if the facility meets the Department's cleanup standards and will provide a written determination of compliance.

Stat. Auth.: ORS 466.706 - ORS 466.995 
Stats. Implemented: OL 1989, Ch. 1071 
Hist.: DEQ 25-1989(Temp), f. & cert. ef. 10-26-89; DEQ 13-1990, f. & cert. ef. 3-13-90

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