72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 558
           (Including Amendments to Resolve Conflicts)
 
                           C-Engrossed
 
                         House Bill 2166
                  Ordered by the Senate June 24
Including House Amendments dated February 5 and May 5 and Senate
                    Amendments dated June 24
 
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
  Presession filed (at the request of Governor Theodore R.
  Kulongoski for Housing and Community Services Department)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
 
  Permits taxpayer eligible to claim farmworker housing tax
credit to transfer all of credit to other taxpayer for tax years
beginning on or after January 1, 2005. Requires application for
farmworker housing tax credit approval to be filed within six
months of start of farmworker housing project.  { + Decreases
total of estimated eligible costs for approved projects for tax
years beginning on or after January 1, 2003. + } Specifies that
owner or operator and contributor must file jointly for letter of
credit approval if contributor will claim portion of tax credit.
Expands definition of farmworker housing project to include
acquisition of housing. Includes nonprofit corporation in
definition of taxpayer.
  Applies to tax years beginning on or after January 1, 2004.
 
                        A BILL FOR AN ACT
Relating to farmworker housing tax credits; creating new
  provisions; and amending ORS 215.277, 315.164, 315.167,
  315.169, 315.172, 317.147 and 455.380.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + As used in ORS 315.164 to 315.172: + }
   { +  (1) 'Acquisition costs' means the cost of acquiring
buildings, structures and improvements that constitute or will
constitute farmworker housing. 'Acquisition costs' does not
include the cost of acquiring land on which farmworker housing is
or will be located.
  (2) 'Condition of habitability' means a condition that is in
compliance with:
  (a) The applicable provisions of the state building code under
ORS chapter 455 and the rules adopted thereunder; or
  (b) If determined on or before December 31, 1995, sections 12
and 13, chapter 964, Oregon Laws 1989.
  (3) 'Contributor' means a person that acquired, constructed,
manufactured or installed farmworker housing or contributed money
to finance a farmworker housing project.
  (4) 'Eligible costs' includes acquisition costs, finance costs,
construction costs, excavation costs, installation costs and
permit costs and excludes land costs.
  (5) 'Farmworker' means any person who, for an agreed
remuneration or rate of pay, performs temporary or permanent
labor for another in the production of farm products or in the
planting, cultivating or harvesting of seasonal agricultural
crops or in the forestation or reforestation of lands, including
but not limited to the planting, transplanting, tubing,
precommercial thinning and thinning of trees and seedlings, the
clearing, piling and disposal of brush and slash and other
related activities.
  (6) 'Farmworker housing' means housing:
  (a) Limited to occupancy by farmworkers and their immediate
families; and
  (b) No dwelling unit of which is occupied by a relative of the
owner or operator of the farmworker housing.
  (7) 'Farmworker housing project' means the acquisition,
construction, installation or rehabilitation of farmworker
housing.
  (8) 'Owner' means a person that owns farmworker housing.  '
Owner' does not include a person that only has an interest in the
housing as a holder of a security interest.
  (9) 'Rehabilitation' means to make repairs or improvements to a
building that improve its livability and are consistent with
applicable building codes.
  (10) 'Relative' means a brother or sister (whether by the whole
or by half blood), spouse, ancestor (whether by law or by blood),
or lineal descendant of an individual.
  (11) 'Taxpayer' includes a nonprofit corporation or other
person not subject to tax under ORS chapter 316, 317 or 318. + }
  SECTION 2.  { + Section 1 of this 2003 Act applies to tax years
beginning on or after January 1, 2004. + }
  SECTION 3. ORS 315.164 is amended to read:
  315.164.   { - (1) As used in this section and ORS 315.169 and
315.172: - }
    { - (a) 'Condition of habitability' means a condition that is
in compliance with: - }
    { - (A) The applicable provisions of the state building code
under ORS chapter 455 and the rules adopted thereunder; or - }
    { - (B) If determined on or before December 31, 1995,
sections 12 and 13, chapter 964, Oregon Laws 1989. - }
    { - (b) 'Contributor' means a person that constructed,
manufactured, installed or contributed money to finance a
farmworker housing project. - }
    { - (c) 'Eligible costs' includes finance costs, construction
costs, excavation costs, installation costs and permit costs and
excludes land costs. - }
    { - (d) 'Farmworker' means any person who, for an agreed
remuneration or rate of pay, performs temporary or permanent
labor for another in the production of farm products or in the
planting, cultivating or harvesting of seasonal agricultural
crops or in the forestation or reforestation of lands, including
but not limited to the planting, transplanting, tubing,
precommercial thinning and thinning of trees and seedlings, the
clearing, piling and disposal of brush and slash and other
related activities. - }
    { - (e) 'Farmworker housing' means housing: - }
    { - (A) Limited to occupancy by farmworkers and their
immediate families; and - }
    { - (B) No dwelling unit of which is occupied by a relative
of the owner or operator of the farmworker housing. - }
    { - (f) 'Farmworker housing project' means construction,
installation or rehabilitation of farmworker housing. - }
 
 
    { - (g) 'Owner' means a person that owns farmworker housing
and does not include a person that only has an interest in the
housing as a holder of a security interest. - }
    { - (h) 'Rehabilitation' means to make repairs or
improvements to a building that improve its livability and are
consistent with applicable building codes. - }
    { - (i) 'Relative' means a brother or sister (whether by the
whole or by half blood), spouse, ancestor (whether by law or by
blood), or lineal descendant of an individual. - }
    { - (2) - }  { +  (1) + } A taxpayer who is the owner or
operator of farmworker housing is allowed a credit against the
taxes otherwise due under ORS chapter 316, if the taxpayer is a
resident individual, or against the taxes otherwise due under ORS
chapter 317, if the taxpayer is a corporation. The total amount
of the credit shall be equal to 50 percent of the eligible costs
actually paid or incurred  { + by the taxpayer + } to complete a
farmworker housing project, to the extent the eligible costs
actually paid or incurred  { + by the taxpayer + } do not exceed
the estimate of eligible costs approved by the Housing and
Community Services Department under ORS 315.167.
    { - (3) - }  { +  (2) + } A taxpayer   { - claiming - }  { +
who is otherwise eligible to claim + } a credit under this
section may elect to transfer a portion of the credit to a
contributor in the manner provided in ORS 315.169. No more than
80 percent of the credit may be transferred.
    { - (4)(a) - }  { +  (3)(a) + } The credit allowed under this
section may be taken for the tax year in which the farmworker
housing project is completed or in any of the nine tax years
succeeding the tax year in which the project is completed.
  (b) The credit allowed in any one tax year may not exceed 20
percent of the amount determined under subsection   { - (2) - }
 { +  (1) + } of this section.
    { - (5)(a) - }  { +  (4)(a) + } To claim a credit under this
section, a taxpayer must show in each year following the
completion of a farmworker housing project that the housing
continues to be operated as farmworker housing.
  (b) A taxpayer need not make the showing required in paragraph
(a) of this subsection if the Housing and Community Services
Department waives the requirement after the taxpayer has
successfully met the requirement for the first five years after
completion of the housing project.
  (c) The Housing and Community Services Department shall
determine by rule the factors necessary to grant a waiver. Such
factors may include a documented decline in a particular area for
farmworker housing.
    { - (6) - }  { +  (5) + } The credit shall apply only to a
farmworker housing project that is located within this state and
physically begun on or after January 1, 1990.
    { - (7)(a) - }  { +  (6)(a) + } A credit may not be allowed
under this section unless the taxpayer claiming credit under this
section:
  (A) Obtains a letter of credit approval from the Housing and
Community Services Department pursuant to ORS 315.167; and
  (B) Files with the Department of Revenue an annual
certification providing that all occupied units for which credit
is being claimed are occupied by farmworkers and their immediate
families.
  (b) The certification described under this subsection shall be
made on the form and in the time and manner prescribed by the
Department of Revenue.
    { - (8) - }  { +  (7) + } Except as provided under subsection
 { - (9) - }  { +  (8) + } of this section, the credit allowed in
any one year may not exceed the tax liability of the taxpayer.
    { - (9) - }  { +  (8) + } 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 for the next succeeding tax year. Any
credit remaining unused in the next succeeding tax year may be
carried forward and used in the second succeeding tax year, and
likewise any credit not used in that second succeeding tax year
may be carried forward and used in the third succeeding tax year,
and any credit not used in that third succeeding tax year may be
carried forward and used in the fourth succeeding tax year, and
any credit not used in that fourth succeeding tax year may be
carried forward and used in the fifth succeeding tax year, and
any credit not used in that fifth succeeding tax year may be
carried forward and used in the sixth succeeding tax year, and
any credit not used in that sixth succeeding tax year may be
carried forward and used in the seventh succeeding tax year, and
any credit not used in that seventh succeeding tax year may be
carried forward and used in the eighth succeeding tax year, and
any credit not used in that eighth succeeding tax year may be
carried forward and used in the ninth succeeding tax year, but
may not be carried forward for any tax year thereafter.
    { - (10)(a) - }  { +  (9)(a) + } The credit provided by this
section is not in lieu of any depreciation or amortization
deduction for the project to which the taxpayer otherwise may be
entitled under ORS chapter 316 or 317 for the year.
  (b) The taxpayer's adjusted basis for determining gain or loss
may not be further decreased by any tax credits allowed under
this section.
    { - (11) - }  { +  (10) + } For a taxpayer to receive a
credit under this section, the farmworker housing must:
  (a) Comply with all occupational safety or health laws, rules,
regulations and standards;
  (b) If registration is required, be registered as a farmworker
camp with the Department of Consumer and Business Services under
ORS 658.750;
  (c) Upon occupancy and if an indorsement is required, be
operated by a person who holds a valid indorsement as a
farmworker camp operator under ORS 658.730; and
  (d) Continue to be operated as farmworker housing for a period
of at least 10 years after the completion of the farmworker
housing project, unless a waiver has been granted under
subsection
  { - (5) - }   { + (4) + } of this section.
    { - (12)(a) - }  { +  (11)(a) + } Pursuant to the procedures
for a contested case under ORS 183.310 to 183.550, the Department
of Revenue may order the disallowance of the credit allowed under
this section if it finds, by order, that:
  (A) The credit was obtained by fraud or misrepresentation; or
  (B) In the event that an owner or operator claims or claimed
the credit:
  (i) The taxpayer has failed to continue to substantially comply
with the occupational safety or health laws, rules, regulations
or standards;
  (ii) After occupancy and if registration is required, the
farmworker housing is not registered as a farmworker camp with
the Department of Consumer and Business Services under ORS
658.750;
  (iii) After occupancy and if an indorsement is required, the
farmworker housing is not operated by a person who holds a valid
indorsement as a farmworker camp operator under ORS 658.730; or
  (iv) The taxpayer has failed to make a showing that the housing
continues to be operated as farmworker housing as required under
subsection   { - (5)(a) - }  { +  (4)(a) + } of this section and
the taxpayer has not been granted a waiver by the Housing and
Community Services Department under subsection   { - (5)(b) - }
 { +  (4)(b) + } of this section.
  (b) If the tax credit is disallowed pursuant to this
subsection, notwithstanding ORS 314.410 or other law, all prior
tax relief provided to the taxpayer shall be forfeited and the
Department of Revenue shall proceed to collect those taxes not
paid by the taxpayer as a result of the prior granting of the
credit.
  (c) If the tax credit is disallowed pursuant to this
subsection, the taxpayer shall be denied any further credit
provided under this section, in connection with the farmworker
housing project, as the case may be, from and after the date that
the order of disallowance becomes final.
    { - (13) - }  { +  (12) + } In the event that the farmworker
housing is destroyed by fire, flood, natural disaster or act of
God before all of the credit has been used, the taxpayer may
nevertheless claim the credit as if no destruction had taken
place. In the event of fire, if the fire chief of the fire
protection district or unit determines that the fire was caused
by arson, as defined in ORS 164.315 and 164.325, by the taxpayer
or by another at the taxpayer's direction, then the fire chief
shall notify the Department of Revenue. Upon conviction of arson,
the Department of Revenue shall disallow the credit in accordance
with subsection
  { - (12) - }  { +  (11) + } of this section.
    { - (14)(a) - }  { +  (13)(a) + } A nonresident individual
shall be allowed the credit computed in the same manner and
subject to the same limitations as the credit allowed a resident
by this section.  However, the credit shall be prorated using the
proportion provided in ORS 316.117.
  (b) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the Department of Revenue
terminates the taxpayer's taxable year under ORS 314.440, the
credit allowed by this section shall be prorated or computed in a
manner consistent with ORS 314.085.
  (c) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
    { - (15) - }  { +  (14) + } The Department of Revenue may
adopt rules for carrying out the provisions of this section.
  SECTION 4.  { + The amendments to ORS 315.164 by section 3 of
this 2003 Act apply to tax years beginning on or after January 1,
2004. + }
  SECTION 5. ORS 315.164, as amended by section 3 of this 2003
Act, is amended to read:
  315.164. (1) A taxpayer who is the owner or operator of
farmworker housing is allowed a credit against the taxes
otherwise due under ORS chapter 316, if the taxpayer is a
resident individual, or against the taxes otherwise due under ORS
chapter 317, if the taxpayer is a corporation. The total amount
of the credit shall be equal to 50 percent of the eligible costs
actually paid or incurred by the taxpayer to complete a
farmworker housing project, to the extent the eligible costs
actually paid or incurred by the taxpayer do not exceed the
estimate of eligible costs approved by the Housing and Community
Services Department under ORS 315.167.
  (2) A taxpayer who is otherwise eligible to claim a credit
under this section may elect to transfer  { + all or + } a
portion of the credit to a contributor in the manner provided in
ORS 315.169.   { - No more than 80 percent of the credit may be
transferred. - }
  (3)(a) The credit allowed under this section may be taken for
the tax year in which the farmworker housing project is completed
or in any of the nine tax years succeeding the tax year in which
the project is completed.
  (b) The credit allowed in any one tax year may not exceed 20
percent of the amount determined under subsection (1) of this
section.
  (4)(a) To claim a credit under this section, a taxpayer must
show in each year following the completion of a farmworker
housing project that the housing continues to be operated as
farmworker housing.
  (b) A taxpayer need not make the showing required in paragraph
(a) of this subsection if the Housing and Community Services
Department waives the requirement after the taxpayer has
successfully met the requirement for the first five years after
completion of the housing project.
  (c) The Housing and Community Services Department shall
determine by rule the factors necessary to grant a waiver. Such
factors may include a documented decline in a particular area for
farmworker housing.
  (5) The credit shall apply only to a farmworker housing project
that is located within this state and physically begun on or
after January 1, 1990.
  (6)(a) A credit may not be allowed under this section unless
the taxpayer claiming credit under this section:
  (A) Obtains a letter of credit approval from the Housing and
Community Services Department pursuant to ORS 315.167; and
  (B) Files with the Department of Revenue an annual
certification providing that all occupied units for which credit
is being claimed are occupied by farmworkers and their immediate
families.
  (b) The certification described under this subsection shall be
made on the form and in the time and manner prescribed by the
Department of Revenue.
  (7) Except as provided under subsection (8) of this section,
the credit allowed in any one year may not exceed the tax
liability of the taxpayer.
  (8) 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
for the next succeeding tax year. Any credit remaining unused in
the next succeeding tax year may be carried forward and used in
the second succeeding tax year, and likewise any credit not used
in that second succeeding tax year may be carried forward and
used in the third succeeding tax year, and any credit not used in
that third succeeding tax year may be carried forward and used in
the fourth succeeding tax year, and any credit not used in that
fourth succeeding tax year may be carried forward and used in the
fifth succeeding tax year, and any credit not used in that fifth
succeeding tax year may be carried forward and used in the sixth
succeeding tax year, and any credit not used in that sixth
succeeding tax year may be carried forward and used in the
seventh succeeding tax year, and any credit not used in that
seventh succeeding tax year may be carried forward and used in
the eighth succeeding tax year, and any credit not used in that
eighth succeeding tax year may be carried forward and used in the
ninth succeeding tax year, but may not be carried forward for any
tax year thereafter.
  (9)(a) The credit provided by this section is not in lieu of
any depreciation or amortization deduction for the project to
which the taxpayer otherwise may be entitled under ORS chapter
316 or 317 for the year.
  (b) The taxpayer's adjusted basis for determining gain or loss
may not be further decreased by any tax credits allowed under
this section.
  (10) For a taxpayer to receive a credit under this section, the
farmworker housing must:
  (a) Comply with all occupational safety or health laws, rules,
regulations and standards;
  (b) If registration is required, be registered as a farmworker
camp with the Department of Consumer and Business Services under
ORS 658.750;
  (c) Upon occupancy and if an indorsement is required, be
operated by a person who holds a valid indorsement as a
farmworker camp operator under ORS 658.730; and
  (d) Continue to be operated as farmworker housing for a period
of at least 10 years after the completion of the farmworker
housing project, unless a waiver has been granted under
subsection (4) of this section.
  (11)(a) Pursuant to the procedures for a contested case under
ORS 183.310 to 183.550, the Department of Revenue may order the
disallowance of the credit allowed under this section if it
finds, by order, that:
  (A) The credit was obtained by fraud or misrepresentation; or
  (B) In the event that an owner or operator claims or claimed
the credit:
  (i) The taxpayer has failed to continue to substantially comply
with the occupational safety or health laws, rules, regulations
or standards;
  (ii) After occupancy and if registration is required, the
farmworker housing is not registered as a farmworker camp with
the Department of Consumer and Business Services under ORS
658.750;
  (iii) After occupancy and if an indorsement is required, the
farmworker housing is not operated by a person who holds a valid
indorsement as a farmworker camp operator under ORS 658.730; or
  (iv) The taxpayer has failed to make a showing that the housing
continues to be operated as farmworker housing as required under
subsection (4)(a) of this section and the taxpayer has not been
granted a waiver by the Housing and Community Services Department
under subsection (4)(b) of this section.
  (b) If the tax credit is disallowed pursuant to this
subsection, notwithstanding ORS 314.410 or other law, all prior
tax relief provided to the taxpayer shall be forfeited and the
Department of Revenue shall proceed to collect those taxes not
paid by the taxpayer as a result of the prior granting of the
credit.
  (c) If the tax credit is disallowed pursuant to this
subsection, the taxpayer shall be denied any further credit
provided under this section, in connection with the farmworker
housing project, as the case may be, from and after the date that
the order of disallowance becomes final.
  (12) In the event that the farmworker housing is destroyed by
fire, flood, natural disaster or act of God before all of the
credit has been used, the taxpayer may nevertheless claim the
credit as if no destruction had taken place. In the event of
fire, if the fire chief of the fire protection district or unit
determines that the fire was caused by arson, as defined in ORS
164.315 and 164.325, by the taxpayer or by another at the
taxpayer's direction, then the fire chief shall notify the
Department of Revenue. Upon conviction of arson, the Department
of Revenue shall disallow the credit in accordance with
subsection (11) of this section.
  (13)(a) A nonresident individual shall be allowed the credit
computed in the same manner and subject to the same limitations
as the credit allowed a resident by this section. However, the
credit shall be prorated using the proportion provided in ORS
316.117.
  (b) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the Department of Revenue
terminates the taxpayer's taxable year under ORS 314.440, the
credit allowed by this section shall be prorated or computed in a
manner consistent with ORS 314.085.
  (c) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
  (14) The Department of Revenue may adopt rules for carrying out
the provisions of this section.
 
 
  SECTION 6.  { + The amendments to ORS 315.164 by section 5 of
this 2003 Act apply to tax years beginning on or after January 1,
2005. + }
  SECTION 6a. ORS 315.167 is amended to read:
  315.167. (1) Prior to beginning a farmworker housing project
for which credit under ORS 315.164 will be claimed, an owner
shall apply to the Housing and Community Services Department for
a letter of credit approval.
  (2) The application shall be on such form as is prescribed by
the Housing and Community Services Department and shall provide:
  (a) The name, address and taxpayer identification number of the
taxpayer;
  (b) The location of the proposed farmworker housing;
  (c) A description of the project identifying the type of
housing that is the subject of the project;
  (d) An estimate of the eligible costs of the project; and
  (e) Any other information as the Housing and Community Services
Department may require.
  (3) The Housing and Community Services Department may review
applications using any reasonable system of prioritizing review
established by department rule.
  (4) Applications filed in compliance with this section shall be
approved by the Housing and Community Services Department to the
extent that the total of estimated eligible costs for all
approved projects for the calendar year is equal to or less than
  { - $7.5 - }  { +  $7.25 + } million. No application shall be
approved if the addition of the estimated eligible costs of the
project to the estimated eligible costs for all approved projects
for the calendar year would exceed   { - $7.5 - }  { +  $7.25 + }
million.
  (5) Upon approval of an application, the Housing and Community
Services Department shall send a letter of credit approval to the
taxpayer. The letter of credit approval shall state the approved
amount of estimated eligible costs for the project.
  (6) At the conclusion of each calendar year, the Housing and
Community Services Department shall send a list of the names,
addresses and taxpayer identification numbers of taxpayers to
whom a letter of credit approval has been issued under this
section during the calendar year, along with approved amounts of
estimated eligible costs for each project, to the Department of
Revenue.
  (7) Notwithstanding that a letter of credit approval has been
issued to a taxpayer under this section, the Department of
Revenue may disallow, in whole or in part, a claim for credit
under ORS 315.164 upon the Department of Revenue's determination
that under the provisions of ORS 315.164 the taxpayer is not
entitled to the credit or is only entitled to a portion of the
amount claimed.
  SECTION 6b.  { + The amendments to ORS 315.167 by section 6a of
this 2003 Act apply to tax years beginning on or after January 1,
2003. + }
  SECTION 6c.  { + (1) Notwithstanding any other provision of
law, a letter of credit approval issued by the Housing and
Community Services Department before the effective date of this
2003 Act that includes estimated eligible costs that, when added
to other estimated eligible costs for all approved projects for
the 2003 calendar year, exceeds $7.25 million is revoked.
  (2) The department shall revoke letters of credit approval
under this section based on the chronological order in which the
letters of credit approval were issued. + }
  SECTION 7. ORS 315.167, as amended by section 6a of this 2003
Act, is amended to read:
  315.167.   { - (1) Prior to beginning a farmworker housing
project for which credit under ORS 315.164 will be claimed, an
owner shall apply to the Housing and Community Services
Department for a letter of credit approval. - }
   { +  (1)(a) Prior to six months after beginning a farmworker
housing project:
  (A) For which credit under ORS 315.164 will be claimed, an
owner or operator of farmworker housing shall apply to the
Housing and Community Services Department for a letter of credit
approval.
  (B) For which credit under ORS 315.169 will be claimed, a
contributor shall apply to the Housing and Community Services
Department for a letter of credit approval.
  (b) If a portion of credit for a farmworker housing project is
to be claimed by the owner or operator of farmworker housing
under ORS 315.164 and the remainder is to be claimed by a
contributor under ORS 315.169, the application described in this
section shall be filed jointly by the owner or operator of
farmworker housing and the contributor. + }
  (2) The application shall be on such form as is prescribed by
the Housing and Community Services Department and shall provide:
  (a) The name, address and taxpayer identification number of the
taxpayer;
  (b) The location of the proposed farmworker housing;
  (c) A description of the project identifying the type of
housing that is the subject of the project;
  (d) An estimate of the eligible costs of the project; and
  (e) Any other information as the Housing and Community Services
Department may require.
  (3) The Housing and Community Services Department may review
applications using any reasonable system of prioritizing review
established by department rule.
  (4) Applications filed in compliance with this section shall be
approved by the Housing and Community Services Department to the
extent that the total of estimated eligible costs for all
approved projects for the calendar year is equal to or less than
$7.25 million. No application shall be approved if the addition
of the estimated eligible costs of the project to the estimated
eligible costs for all approved projects for the calendar year
would exceed $7.25 million.
    { - (5) Upon approval of an application, the Housing and
Community Services Department shall send a letter of credit
approval to the taxpayer. The letter of credit approval shall
state the approved amount of estimated eligible costs for the
project. - }
   { +  (5) Upon approval of an application, the Housing and
Community Services Department shall prepare a letter of credit
approval. The letter shall state the approved amount of estimated
eligible costs for the project and, if applicable, the portion of
credit to be claimed by an owner or operator of farmworker
housing under ORS 315.164 and the portion of credit to be claimed
by a contributor under ORS 315.169. The letter shall be sent:
  (a) To the owner or operator of farmworker housing, if any
credit is to be claimed under ORS 315.164; and
  (b) To the contributor, if any credit is to be claimed under
ORS 315.169. + }
  (6) At the conclusion of each calendar year, the Housing and
Community Services Department shall send a list of the names,
addresses and taxpayer identification numbers of taxpayers to
whom a letter of credit approval has been issued under this
section during the calendar year, along with approved amounts of
estimated eligible costs for each project, to the Department of
Revenue.
  (7) Notwithstanding that a letter of credit approval has been
issued to a taxpayer under this section, the Department of
Revenue may disallow, in whole or in part, a claim for credit
under ORS 315.164 upon the Department of Revenue's determination
that under the provisions of ORS 315.164 the taxpayer is not
entitled to the credit or is only entitled to a portion of the
amount claimed.
  SECTION 8.  { + The amendments to ORS 315.167 by section 7 of
this 2003 Act apply to tax years beginning on or after January 1,
2004. + }
  SECTION 9. ORS 315.169 is amended to read:
  315.169. (1) A taxpayer that is a contributor is allowed a
credit against the taxes otherwise due under ORS chapter 316, if
the taxpayer is a resident individual, or ORS chapter 317, if the
taxpayer is a corporation, to the extent the owner or operator of
farmworker housing transferred a portion of the credit allowed to
the owner or operator under ORS 315.164.
  (2) An owner or operator of farmworker housing may transfer a
portion of the credit allowed to the owner or operator under ORS
315.164 to one or more contributors in portions that do not total
more than 80 percent of the total credit the owner or operator
may claim.
  (3) To receive a credit under this section:
    { - (a) The owner or operator and contributor must jointly
file a statement with the Department of Revenue stating the
portion of credit the contributor is allowed to claim and any
other information the department may require by rule; and - }
    { - (b) The contributor must show that upon completion of the
farmworker housing project and first occupation by farmworkers,
the housing complies with all occupational safety or health laws,
rules, regulations and standards applicable for farmworker
housing. - }
   { +  (a) The contributor must obtain a letter of credit
approval from the Housing and Community Services Department under
ORS 315.167; or
  (b) If the owner or operator of farmworker housing elects to
transfer all or a portion of the credit allowed under ORS 315.164
after the date that a letter of credit approval has been issued
to the owner or operator, the owner or operator and the
contributor must jointly file a statement with the Department of
Revenue stating the portion of the credit the contributor is
allowed to claim and any other information the department may
require by rule. + }
  (4) A contributor remains eligible to receive a credit under
this section even if the owner or operator of the farmworker
housing becomes ineligible for the credit as a result of:
  (a) Failure to file the annual certification under ORS 315.164
 { - (7) - }  { +  (6) + };
  (b) Failure to continue to substantially comply with
occupational safety or health laws, rules, regulations or
standards under ORS 315.164   { - (11) - }  { +  (10) + };
  (c) Failure to register as a farmworker camp with the
Department of Consumer and Business Services under ORS 658.750;
  (d) Failure of the operator to hold a valid indorsement as a
farmworker camp operator under ORS 658.730; or
  (e) Failure to comply with any other rules or provisions
relating to the operation or maintenance of the farmworker
housing after the contributor has completed work on the project.
  (5)(a) A contributor does not remain eligible to receive a
credit under this section if the Department of Revenue finds, by
order of a disallowance of credit and pursuant to the procedures
for a contested case under ORS 183.310 to 183.550, that the
contributor obtained the credit by fraud or misrepresentation,
including a finding that the housing did not comply with all
occupational safety or health laws, rules, regulations and
standards applicable for farmworker housing at the time the
housing was completed.
  (b) If the credit is disallowed pursuant to this subsection,
notwithstanding ORS 314.410 or other law, all prior tax relief
provided to the taxpayer shall be forfeited and the department
shall proceed to collect those taxes not paid by the taxpayer as
a result of the prior granting of the credit.
 
  (c) If the credit is disallowed pursuant to this subsection,
the taxpayer shall be denied any further credit provided under
this section, in connection with the farmworker housing project,
as the case may be, from and after the date that the order of
disallowance becomes final.
  (6)(a) The credit allowed under this section may be taken for
the tax year in which the farmworker housing project is completed
or in any of the nine tax years succeeding the tax year in which
the project is completed.
  (b) The credit allowed in any one tax year may not exceed 20
percent of the amount determined under subsection (2) of this
section that was transferred to the contributor claiming the
credit.
  (7) Except as provided under subsection (8) of this section,
the credit allowed in any one year may not exceed the tax
liability of the taxpayer.
  (8) 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
for the next succeeding tax year. Any credit remaining unused in
such next succeeding tax year may be carried forward and used in
the second succeeding tax year, and likewise any credit not used
in that second succeeding tax year may be carried forward and
used in the third succeeding tax year, and any credit not used in
that third succeeding tax year may be carried forward and used in
the fourth succeeding tax year, and any credit not used in that
fourth succeeding tax year may be carried forward and used in the
fifth succeeding tax year, and any credit not used in that fifth
succeeding tax year may be carried forward and used in the sixth
succeeding tax year, and any credit not used in that sixth
succeeding tax year may be carried forward and used in the
seventh succeeding tax year, and any credit not used in that
seventh succeeding tax year may be carried forward and used in
the eighth succeeding tax year, and any credit not used in that
eighth succeeding tax year may be carried forward and used in the
ninth succeeding tax year, but may not be carried forward for any
tax year thereafter.
  (9)(a) A nonresident individual shall be allowed the credit
computed in the same manner and subject to the same limitations
as the credit allowed a resident by this section. However, the
credit shall be prorated using the proportion provided in ORS
316.117.
  (b) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the department terminates the
taxpayer's taxable year under ORS 314.440, the credit allowed by
this section shall be prorated or computed in a manner consistent
with ORS 314.085.
  (c) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
  (10) The department may adopt rules for carrying out the
provisions of this section.
  SECTION 10.  { + The amendments to ORS 315.169 by section 9 of
this 2003 Act apply to tax years beginning on or after January 1,
2004. + }
  SECTION 11. ORS 315.169, as amended by section 9 of this 2003
Act, is amended to read:
  315.169. (1) A taxpayer that is a contributor is allowed a
credit against the taxes otherwise due under ORS chapter 316, if
the taxpayer is a resident individual, or ORS chapter 317, if the
taxpayer is a corporation, to the extent the owner or operator of
farmworker housing transferred  { + all or + } a portion of the
credit allowed to the owner or operator under ORS 315.164.
  (2) An owner or operator of farmworker housing may transfer
 { +  all or + } a portion of the credit allowed to the owner or
operator under ORS 315.164 to one or more contributors   { - in
portions that do - }  { +  but the amount transferred may + } not
total more than   { - 80 percent of - }  the total credit the
owner or operator may claim.
  (3) To receive a credit under this section:
  (a) The contributor must obtain a letter of credit approval
from the Housing and Community Services Department under ORS
315.167; or
  (b) If the owner or operator of farmworker housing elects to
transfer all or a portion of the credit allowed under ORS 315.164
after the date that a letter of credit approval has been issued
to the owner or operator, the owner or operator and the
contributor must jointly file a statement with the Department of
Revenue stating the portion of the credit the contributor is
allowed to claim and any other information the department may
require by rule.
  (4) A contributor remains eligible to receive a credit under
this section even if the owner or operator of the farmworker
housing becomes ineligible for the credit as a result of:
  (a) Failure to file the annual certification under ORS 315.164
(6);
  (b) Failure to continue to substantially comply with
occupational safety or health laws, rules, regulations or
standards under ORS 315.164 (10);
  (c) Failure to register as a farmworker camp with the
Department of Consumer and Business Services under ORS 658.750;
  (d) Failure of the operator to hold a valid indorsement as a
farmworker camp operator under ORS 658.730; or
  (e) Failure to comply with any other rules or provisions
relating to the operation or maintenance of the farmworker
housing after the contributor has completed work on the project.
  (5)(a) A contributor does not remain eligible to receive a
credit under this section if the Department of Revenue finds, by
order of a disallowance of credit and pursuant to the procedures
for a contested case under ORS 183.310 to 183.550, that the
contributor obtained the credit by fraud or misrepresentation,
including a finding that the housing did not comply with all
occupational safety or health laws, rules, regulations and
standards applicable for farmworker housing at the time the
housing was completed.
  (b) If the credit is disallowed pursuant to this subsection,
notwithstanding ORS 314.410 or other law, all prior tax relief
provided to the taxpayer shall be forfeited and the department
shall proceed to collect those taxes not paid by the taxpayer as
a result of the prior granting of the credit.
  (c) If the credit is disallowed pursuant to this subsection,
the taxpayer shall be denied any further credit provided under
this section, in connection with the farmworker housing project,
as the case may be, from and after the date that the order of
disallowance becomes final.
  (6)(a) The credit allowed under this section may be taken for
the tax year in which the farmworker housing project is completed
or in any of the nine tax years succeeding the tax year in which
the project is completed.
  (b) The credit allowed in any one tax year may not exceed 20
percent of the amount determined under subsection (2) of this
section that was transferred to the contributor claiming the
credit.
  (7) Except as provided under subsection (8) of this section,
the credit allowed in any one year may not exceed the tax
liability of the taxpayer.
  (8) 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
for the next succeeding tax year. Any credit remaining unused in
such next succeeding tax year may be carried forward and used in
the second succeeding tax year, and likewise any credit not used
in that second succeeding tax year may be carried forward and
used in the third succeeding tax year, and any credit not used in
that third succeeding tax year may be carried forward and used in
the fourth succeeding tax year, and any credit not used in that
fourth succeeding tax year may be carried forward and used in the
fifth succeeding tax year, and any credit not used in that fifth
succeeding tax year may be carried forward and used in the sixth
succeeding tax year, and any credit not used in that sixth
succeeding tax year may be carried forward and used in the
seventh succeeding tax year, and any credit not used in that
seventh succeeding tax year may be carried forward and used in
the eighth succeeding tax year, and any credit not used in that
eighth succeeding tax year may be carried forward and used in the
ninth succeeding tax year, but may not be carried forward for any
tax year thereafter.
  (9)(a) A nonresident individual shall be allowed the credit
computed in the same manner and subject to the same limitations
as the credit allowed a resident by this section. However, the
credit shall be prorated using the proportion provided in ORS
316.117.
  (b) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the department terminates the
taxpayer's taxable year under ORS 314.440, the credit allowed by
this section shall be prorated or computed in a manner consistent
with ORS 314.085.
  (c) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
  (10) The department may adopt rules for carrying out the
provisions of this section.
  SECTION 12.  { + The amendments to ORS 315.169 by section 11 of
this 2003 Act apply to tax years beginning on or after January 1,
2005. + }
  SECTION 13.  { + Section 1 of this 2003 Act is added to and
made a part of ORS 315.164 to 315.172. + }
  SECTION 14. ORS 215.277 is amended to read:
  215.277. It is the intent of the Legislative Assembly that the
provision of farmworker housing, as defined in   { - ORS
315.164 - }  { + section 1 of this 2003 Act + }, not allow other
types of dwellings not otherwise permitted in exclusive farm use
zones and that such farmworker housing be consistent with the
intent and purposes set forth in ORS 215.243.
  SECTION 15. ORS 315.172 is amended to read:
  315.172. Upon an order of the disallowance of a credit for
farmworker housing under ORS 315.164   { - (12) - }
 { + (11) + } or 315.169 (5), the Department of Revenue
immediately shall collect any taxes due by reason of the
disallowance and shall have the benefit of all the laws of this
state pertaining to the collection of income and excise taxes. An
assessment of the taxes is not necessary and a statute of
limitation shall not preclude the collection of the taxes.
  SECTION 16. ORS 317.147, as amended by section 44, chapter 46,
Oregon Laws 2003 (Enrolled House Bill 2424), is amended to read:
  317.147. (1) As used in this section:
  (a) 'Farmworker housing' has the meaning given that term
  { - under ORS 315.164 - }  { +  in section 1 of this 2003
Act + }.
  (b) 'Lending institution' means a bank, mortgage banking
company, trust company, savings bank, savings and loan
association, credit union, national banking association, federal
savings and loan association, federal credit union maintaining an
office in this state, nonprofit community development financial
institution or nonprofit public benefit corporation operating as
a lending institution.
  (2)(a) A lending institution shall be allowed a credit against
the taxes otherwise due under this chapter for the tax year equal
to 50 percent of the interest income earned during the tax year
on loans to finance only costs directly associated with
construction or rehabilitation of farmworker housing if, at the
time the loan is made, the borrower certifies, to the
satisfaction of the lender, that upon completion of the
construction or rehabilitation and first occupation by
farmworkers, the housing will comply with all occupational safety
or health laws, rules, regulations and standards applicable for
farmworker housing and that the housing will be occupied only by
farmworkers and their immediate families.
  (b) A copy of the certification described under paragraph (a)
of this subsection shall be submitted to the Department of
Revenue at the time that a credit under this section is first
claimed.
  (3) The credit allowed under this section applies only to loans
to construct or rehabilitate farmworker housing located within
this state.
  (4) This credit applies only to loans made on or after January
1, 1990.
  (5) The credit allowed in any one year may not exceed the tax
liability of the taxpayer.
  (6) If the loan has a term of longer than 10 years, then the
credit shall be allowed only for the tax year of the taxpayer
during which the loan is made and the nine tax years immediately
following.
  (7) The credit allowed under this section does not apply to
loans in which the interest rate charged exceeds 13-1/2 percent
per annum.
  (8) The credit allowed under this section applies only to
interest income from the loan and does not apply to any other
loan fees or other charges collected by the lending institution
with respect to the loan.
  (9) The credit allowed under this section applies only to
interest income actually collected by the lending institution
during the tax year.
  (10)(a) Except as provided in paragraph (b) of this subsection,
if the lending institution sells the loan to another lending
institution, then the credit shall pass to the assignee or
transferee of the loan, subject to the same conditions and
limitations as set forth in this section.
  (b) A lending institution may assign, sell or otherwise
transfer the loan to another person and retain the right to claim
the credit granted under this section if the lending institution
also retains responsibility for servicing the loan.
  (c)(A) A lending institution that is not subject to taxation
under this chapter may sell or otherwise transfer the credit
allowed to the lending institution under this section to a
taxpayer that is subject to taxation under this chapter.
  (B) A transferee of a credit under this section shall be
allowed the credit for the tax years that would have been
allowable to the transferor had the transfer not occurred.
  (C) The Department of Revenue shall by rule establish
procedures for transferring a credit under this section.
  SECTION 17. ORS 455.380 is amended to read:
  455.380. (1) Notwithstanding the provisions of ORS 455.148 and
455.150, the Department of Consumer and Business Services is the
final authority in interpretation, execution and enforcement of
state and municipal administration of building codes and rules
with respect to construction of farmworker housing as defined in
  { - ORS 315.164 - }  { +  section 1 of this 2003 Act + }.
  (2) The department shall provide for a statewide uniform
application and method of calculating permit fees for farmworker
housing as defined in   { - ORS 315.164 - }  { +  section 1 of
this 2003 Act + }.
  (3) The department shall adopt rules to carry out the
provisions of subsections (1) and (2) of this section.
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