For purposes of ORS
285C.549 and the pass-through
rate for discounting the face value of a certified Business Energy Tax Credit
to the Net Present Value that is the minimum amount the Applicant shall receive
as a cash payment from the Pass-through Partner(s) in exchange for the
Credit:
(1) Rate Formula. As set forth
by the Department on the first business day of each calendar quarter, the
pass-through rate, to be multiplied by the credit amount, equals "1 รท (1
+ R + S + P)^5," where:
(a) "R" is the U.S.
Prime Rate as published by The Wall Street Journal newspaper;
(b) "S" is a spread factor greater than zero
to account for special transactional and risk elements, and initially set at
3.25 percentage points, but subject to adjustment by the Department based on
experience and changing circumstances;
(c) "P" is an estimate of projected price
inflation, as determined by the Department, but to be not less than the average
of the lower central tendency for core price inflation in the succeeding two
years from the latest economic projections of the Federal Reserve Board members
and Federal Reserve Bank presidents; and
(d) "5" means to exponentially raise the
preceding sum to the fifth power in accordance with the five years over which
the credit may be claimed.
(2) Modification of Formula. In addition to
modifications of the variables "R" and "S" in subsection (1)(a) of this rule,
the Department may alter the formula for purposes of this rule, as announced at
the start of the calendar quarter, in response to any greatly changing
situation with prevailing market rates of return or projected price inflation,
potentially pending a temporary or permanent rulemaking.
(3) Rate Option. The Applicant may elect to
use the quarterly pass-through rate as set in section (1) of this rule for the
calendar quarter, during which occurs either:
(a) Preliminary Certification, or
(b) Transaction of the pass-through
payment.
(4) For the
Department to issue a tax credit certificate to a pass through partner the
Applicant must be in compliance with the conditions and requirements of the
Preliminary Certificate, the performance agreement and these rules.
(5) A tax credit may be transferred one time
only, from the Applicant to an eligible pass through partner.
(6) Finding Pass-through Partners. The
Applicant is responsible for seeking a pass-through partner. The Department
cannot guarantee a pass-through partner for any completed project.
(a) The Applicant will notify the Department
if a third-party intermediary will be used to assist the Applicant in seeking a
pass-through partner.
(b) The
Applicant will notify the Department when a pass-through partner(s) is
identified. The Department will provide the necessary instructions and forms
needed to complete verification of the pass-through payment transaction in
order to issue a tax credit certificate.
(7) Transferee's Certification Period. For a
transferee holding a credit that has been transferred under ORS
285C.549, the five-year period
begins with the tax year of the transferee in which the transferee pays for the
credit.
(8) Expiration of
Transferability. The Director may issue a final certificate in the name of the
Applicant for any tax credit balance remaining sixty days prior to the
expiration of the Preliminary Certificate under ORS
285C.547(5).
