Oregon Administrative Rules › Chapter 340 - DEPARTMENT OF ENVIRONMENTAL QUALITY › Division 180 - UNDERGROUND STORAGE TANK LOAN GUARANTEE AND INTEREST RATE SUBSIDY PROGRAM › Section 340-180-0090 - General Provisions, Interest Rate Subsidy and Tax Credit Certificate

Current through Register Vol. 63, No. 7, July 1, 2024
(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.