Bill Text: OR HB2209 | 2011 | Regular Session | Introduced

---

Bill Title: Relating to clean energy economic development; appropriating money; declaring an emergency.

Spectrum: Unknown

Status: (Failed) 2011-06-30 - In committee upon adjournment. [HB2209 Detail]

Download: Oregon-2011-HB2209-Introduced.html

---

     76th OREGON LEGISLATIVE ASSEMBLY--2011 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 2998

                         House Bill 2209

Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
  Presession filed (at the request of House Interim Committee on
  Sustainability and Economic Development)

                             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 as
introduced.

  Establishes Oregon Fund for Energy, Jobs and Innovation.
  Authorizes Oregon Innovation Council to make grants and loans
from fund for clean energy economic development proposals.
Establishes minimum proposal requirements. Requires nonprofit
entity or signature research center to issue request for
proposals and make recommendations for funding to council.
Requires council to adopt rules.
  Permits council to determine eligibility of proposals for
revenue bond financing. Requires Oregon Business Development
Department to request issuance of revenue bonds by State
Treasurer upon determination of eligibility.
  Authorizes Oregon Innovation Council to establish one or more
signature research centers.
  Establishes clean energy economic development charge to be
collected by public utilities for deposit in Oregon Fund for
Energy, Jobs and Innovation to fund proposals for clean energy
economic development.
  Declares emergency, effective on passage.

                        A BILL FOR AN ACT
Relating to clean energy economic development; creating new
  provisions; amending ORS 284.740; appropriating money; and
  declaring an emergency.
  Whereas the Legislative Assembly finds that Oregon is
recognized as a leader in sustainability and mitigation of
climate change and that Oregon has the foundation to become a
leader in clean energy economic development; and
  Whereas clean energy economic development offers Oregon an
excellent opportunity to create family wage jobs; and
  Whereas Oregon leads the nation in creating jobs associated
with energy conservation and wind, solar, hydropower,
hydroelectric biomass, geothermal and wave energies; and
  Whereas Oregon has invested more than $2 billion to expand
energy conservation and to improve development of its clean
energy resources; and
  Whereas it is essential for Oregon to attract and retain
top-level students and professors to provide clusters of
expertise and to expand the clean energy talent base in this
state; and
  Whereas a multidisciplinary approach to education and research
is an essential ingredient for the long-term success of clean
energy economic development in Oregon; and
  Whereas Oregon's public and private educational institutions
must improve and expand their engineering facilities, programs
and educational and research capabilities to meet the needs of
this state's emerging clean energy industry; and
  Whereas the Oregon University System, as well as private
universities and research institutions in this state, are
strategic partners in meeting the unique educational and
employment needs of Oregon's clean energy industry; and
  Whereas to become a leader in clean energy economic
development, Oregon needs policies and strategies to develop new
clean energy technologies, to attract funding from federal
sources and private sector clean energy investments, to attract
and grow clean energy businesses and to create clean energy jobs;
and
  Whereas the Legislative Assembly finds that state agencies,
clean energy technology businesses, research institutions,
national laboratories, and workforce development agencies must
collaborate so that Oregon is well-positioned to compete for
funds from federal sources and private sector clean energy
investments; now, therefore,
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Sections 2 to 8 of this 2011 Act are added to
and made a part of ORS 284.701 to 284.740. + }
  SECTION 2.  { + (1) The Oregon Fund for Energy, Jobs and
Innovation is established in the State Treasury, separate and
distinct from the General Fund. Interest earned by the Oregon
Fund for Energy, Jobs and Innovation shall be credited to the
fund.
  (2) Moneys in the Oregon Fund for Energy, Jobs and Innovation
shall consist of:
  (a) Amounts donated to the fund;
  (b) Amounts appropriated or otherwise transferred to the fund
by the Legislative Assembly;
  (c) Investment earnings received on moneys in the fund; and
  (d) Other amounts deposited in the fund from any source.
  (3) Moneys in the fund are continuously appropriated to the
Oregon Innovation Council for the purpose of making grants and
loans under section 3 of this 2011 Act.
  (4) At least 15 percent of the moneys in the fund that are used
to make grants or loans under section 3 of this 2011 Act must be
designated for the purposes of enhancing and supporting the
education of undergraduate and graduate students who are studying
clean energy and for hiring and retention of faculty who are
instructing or conducting research in the area of clean
energy. + }
  SECTION 3.  { + (1) As used in sections 2 to 8 of this 2011
Act:
  (a) 'Clean energy' means a technology, product, process or
innovation that involves conservation of natural resources, solar
energy, green building products and services, biofuels, biomass
energy, bio-based products or other renewable and sustainable
energy as defined by the Oregon Innovation Council by rule.
  (b) 'Gap funding' means funding provided to an Oregon clean
energy business to fund the initial phase of a business endeavor
until funding for subsequent phases of the Oregon clean energy
business endeavor can be obtained from another source.
  (c) 'Nonprofit entity' means a not-for-profit entity described
in subsection (4) of this section that is recognized as tax
exempt under section 501(c)(3) of the Internal Revenue Code, as
in effect on the effective date of this 2011 Act.
  (d) 'Oregon clean energy business' means a business composed of
an individual, association of individuals, joint venture,
partnership, limited liability company, nonprofit entity or
corporation that is engaged in a clean energy business endeavor
to transfer clean energy technology to the private sector or to
commercialize clean energy research and development in Oregon.
  (e) 'Seed capital' has the meaning given that term in ORS
348.701.
  (2) The Oregon Innovation Council, in consultation with the
Oregon Business Development Department, may make grants and loans
from the Oregon Fund for Energy, Jobs and Innovation established
under section 2 of this 2011 Act to fund proposals that have been
reviewed by, and recommended to the council for funding by, a
nonprofit entity or a signature research center as provided in
subsection (3) of this section, and that have as their principal
objectives:
  (a) The establishment of partnerships between and
collaborations with research institutions to create and support
innovation, economic development and competitiveness in clean
energy;
  (b) The education and training of undergraduate and graduate
students, and the hiring and retention of faculty, in the area of
clean energy;
  (c) The transfer of clean energy technology to the private
sector or the commercialization of clean energy research and
development in Oregon;
  (d) To provide seed capital or gap funding to an Oregon clean
energy business for a business endeavor that seeks to market
innovative clean energy concepts, to transfer clean energy
technology to the private sector or to commercialize clean energy
research and development in Oregon; or
  (e) To provide monetary awards to winners of competitive
contests designed to attract innovative and entrepreneurial
solutions and opportunities for clean energy economic development
in this state.
  (3)(a) To qualify for a grant or loan under subsection (2) of
this section, a proposal must be submitted in accordance with
this subsection and the standards and requirements adopted by the
Oregon Innovation Council by rule.
  (b) Proposals for funding under subsection (2) of this section
must be submitted to, reviewed by and recommended to the council
for funding by a nonprofit entity or signature research center
that issues a request for proposal as provided in subsection (4)
of this section.
  (c) All proposals for funding under subsection (2) of this
section must establish return on investment criteria and
performance measures that include, but are not limited to:
  (A) The number of clean energy technologies, products or
services that will be newly commercialized by Oregon companies;
  (B) The amount of funding from federal sources and private
sector investments that will be raised for clean energy efforts
in Oregon;
  (C) Measurable increases in the volume of clean energy research
conducted in Oregon;
  (D) Measurable increases in the availability and quality of
trained faculty and students and of applied research facilities
in clean energy in Oregon;
  (E) Measurable increases in job growth and wages for Oregon
workers; and
  (F) The amount of annual tax revenues that would not have
otherwise been received without funding under subsection (2) of
this section.
  (d) Proposals for funding under subsection (2)(e) of this
section must contain a verified statement that, if the applicant
receives a monetary award as a winner of a competitive contest,
the applicant has established, or intends to establish, an Oregon
clean energy business:

  (A) That has its principal place of business and principal
business operations located in this state for a minimum of five
years from the date of the award; and
  (B) That spends at least 50 percent of its payroll on employees
who are residents of this state.
  (4)(a) Requests for proposals for funding under subsection (2)
of this section must be prepared, published and issued by a
nonprofit entity that meets the requirements of this subsection,
or by a signature research center established under ORS 284.740,
in accordance with rules adopted by the Oregon Innovation
Council.
  (b) A nonprofit entity described in paragraph (a) of this
subsection must:
  (A) Collaborate and cooperate with a signature research center
established under ORS 284.740 whose focus includes clean energy
research and development in Oregon;
  (B) Advise the signature research center identified in
subparagraph (A) of this paragraph of any proposal received and
reviewed by the nonprofit entity, allowing sufficient time for
the signature research center to solicit further information
about the proposal and to provide comment to the council
regarding the advisability of funding the proposal, whether or
not the nonprofit entity recommends the proposal to the council
for funding under subsection (2) of this section;
  (C) Establish a board of directors that includes, or expand an
existing board of directors so that it will include, a member of
the council and a member of the Legislative Assembly;
  (D) Provide an annual accounting to, and make financial
statements and records available for inspection and copying by, a
committee established by the council under ORS 284.706 for that
purpose for each proposal that is recommended for funding by the
nonprofit entity and that is subsequently funded under subsection
(2) of this section; and
  (E) Have as a primary purpose, set forth in the nonprofit
entity's bylaws or articles of incorporation, to increase the
availability of funding from federal sources and private sector
investments for the objectives set forth in subsection (2) of
this section.
  (5) The Oregon Innovation Council shall adopt rules to
administer subsections (2) to (4) of this section. + }
  SECTION 4.  { + As used in sections 4 to 8 of this 2011 Act, '
bond-related costs' means:
  (1) The costs and expenses of issuing and administering bonds
under sections 4 to 8 of this 2011 Act, including but not limited
to:
  (a) Paying or redeeming the bonds, including principal,
interest and premium, if any;
  (b) Paying amounts due in connection with credit enhancement
devices or reserve instruments;
  (c) Paying the administrative costs and expenses of the State
Treasurer, the Oregon Business Development Department and the
Oregon Innovation Council, including the cost of consultants,
attorneys and advisers retained by the State Treasurer, the
department or the council for the bonds; and
  (d) Any other costs or expenses that the State Treasurer, the
department or the council determines are necessary or desirable
in connection with issuing or administering the bonds;
  (2) The cost of funding bond reserves;
  (3) Capitalized interest for the bonds; and
  (4) Rebates or penalties due to the United States in connection
with the bonds. + }
  SECTION 5.  { + (1)(a) The Oregon Innovation Council, in
consultation with the Oregon Business Development Department,
shall determine eligibility for revenue bond financing of
proposals for funding under section 3 of this 2011 Act pursuant

to rules adopted by the council in consultation with the
department.
  (b) After determining that a proposal, grant or loan is
eligible for revenue bond financing under paragraph (a) of this
subsection, the department shall forward a request for the
issuance of revenue bonds to the State Treasurer who shall
determine whether to issue revenue bonds.
  (2) The State Treasurer may issue revenue bonds in an amount
not to exceed net proceeds of $16 million for the purpose of
financing or refinancing, in whole or part, grants and loans made
under section 3 of this 2011 Act, plus an additional amount to be
estimated by the State Treasurer for payment of bond-related
costs.
  (3) Net proceeds of the revenue bonds issued pursuant to this
section must be deposited in the Energy, Jobs and Innovation Bond
Fund, established under section 6 of this 2011 Act, in an amount
sufficient to provide $16 million in net proceeds and interest
earnings for disbursement to the Oregon Innovation Council to
finance the making of grants and loans under section 3 of this
2011 Act.
  (4) Bond-related costs must be paid from the gross proceeds of
the revenue bonds issued under this section and from moneys
deposited in the Oregon Fund for Energy, Jobs and Innovation
established under section 2 of this 2011 Act.
  (5) The State Treasurer, with the approval of the Oregon
Business Development Department and the Oregon Innovation
Council, may irrevocably pledge and assign all or a portion of
the moneys deposited in the Oregon Fund for Energy, Jobs and
Innovation to secure revenue bonds or credit enhancements.
  (6) Revenue bonds issued under this section:
  (a) Are payable from the moneys deposited in the Oregon Fund
for Energy, Jobs and Innovation.
  (b) Do not constitute a debt or general obligation of this
state, the Legislative Assembly or a political subdivision of
this state but are secured solely by the moneys deposited in the
Oregon Fund for Energy, Jobs and Innovation, by amounts in a debt
service reserve account established with respect to revenue bonds
issued under this section or by a credit enhancement obtained for
the revenue bonds issued under this section.
  (7) The State Treasurer, the Oregon Business Development
Department and the Oregon Innovation Council have no obligation
to pay bond-related costs except as provided in this section. A
holder of revenue bonds or other similar obligations issued under
this section does not have the right to compel the exercise of
the taxing power of the state to pay bond-related costs.
  (8) The holders of revenue bonds issued under this section,
upon the issuance of the revenue bonds, have a perfected lien on
the moneys deposited in the Oregon Fund for Energy, Jobs and
Innovation that are pledged and assigned to the payment of the
revenue bonds. The lien and pledge are valid and binding from the
date of issuance of the revenue bonds and are automatically
perfected without physical delivery, filing or other act. The
lien and pledge are superior to subsequent claims or liens on the
moneys deposited in the Oregon Fund for Energy, Jobs and
Innovation.
  (9) As long as any revenue bonds issued under this section are
outstanding, the provisions of this section and the provisions of
a security document related to the revenue bonds are deemed to be
contracts between the state and holders of the revenue bonds.
The state:
  (a) May not create a lien, encumbrance or any other obligation
that is superior to the liens authorized by subsection (8) of
this section on the moneys in the Oregon Fund for Energy, Jobs
and Innovation that are pledged and assigned to the payment of
the revenue bonds; and

  (b) May not give force or effect to a statute or initiative or
referendum measure approved by the electors of this state, if
doing so would unconstitutionally impair existing covenants made
with the holders of existing revenue bonds or would
unconstitutionally impair other obligations or agreements
regarding the security of revenue bonds to which the moneys
deposited in the Oregon Fund for Energy, Jobs and Innovation are
pledged and assigned.
  (10) The Oregon Innovation Council is authorized to establish
separate accounts within the Oregon Fund for Energy, Jobs and
Innovation for separate bond issues.
  (11) The Oregon Innovation Council may:
  (a) Make all contracts, execute all instruments and do all
things necessary or convenient in the exercise of the powers
granted by this section, or in the performance of its covenants
or duties, or in order to secure the payment of revenue bonds
issued under this section; and
  (b) Enter into covenants for the benefit of bond owners
regarding the use and expenditure of moneys in the Oregon Fund
for Energy, Jobs and Innovation.
  (12) The State Treasurer, the Oregon Innovation Council or the
Oregon Business Development Department may appoint bond counsel
as prescribed in ORS 286A.130. + }
  SECTION 6.  { + (1) The Energy, Jobs and Innovation Bond Fund
is established in the State Treasury, separate and distinct from
the General Fund. The net proceeds from the sale of revenue bonds
issued under section 5 of this 2011 Act must be credited to the
Energy, Jobs and Innovation Bond Fund. Investment earnings
received on moneys in the fund must be credited to the fund.
  (2) Moneys in the fund are continuously appropriated to the
Oregon Innovation Council for the purpose of making grants and
loans under section 3 of this 2011 Act. + }
  SECTION 7.  { + (1) The Energy, Jobs and Innovation Debt
Service Fund is established in the State Treasury, separate and
distinct from the General Fund. The Energy, Jobs and Innovation
Debt Service Fund consists of:
  (a) An amount from the moneys deposited in the Oregon Fund for
Energy, Jobs and Innovation credited to the Energy, Jobs and
Innovation Debt Service Fund by the State Treasurer that is
necessary in a fiscal year, as determined by the Oregon
Innovation Council, in consultation with the Oregon Business
Development Department and the State Treasurer, to pay the
bond-related costs scheduled to be paid in that fiscal year on
the revenue bonds issued under section 5 of this 2011 Act;
  (b) Any funds appropriated or allocated to the Energy, Jobs and
Innovation Debt Service Fund; and
  (c) Investment earnings received on moneys in the Energy, Jobs
and Innovation Debt Service Fund.
  (2) Moneys in the Energy, Jobs and Innovation Debt Service Fund
are continuously appropriated to the Oregon Innovation Council to
pay, when due, the bond-related costs on outstanding revenue
bonds, to fund revenue bond reserves and to pay amounts due in
connection with credit enhancements.
  (3) The Oregon Innovation Council, in consultation with the
Oregon Business Development Department and the State Treasurer,
shall use amounts in the Energy, Jobs and Innovation Debt Service
Fund to pay, when due, the bond-related costs on outstanding
revenue bonds, to fund revenue bond reserves and to pay amounts
due in connection with credit enhancements.
  (4) If the moneys deposited in the Oregon Fund for Energy, Jobs
and Innovation are not sufficient to pay the bond-related costs
due to be paid in a fiscal year, the Oregon Innovation Council,
in consultation with the Oregon Business Development Department
and the State Treasurer, shall make payments in that fiscal year
according to the relative priority of revenue bonds secured by

the moneys deposited in the Oregon Fund for Energy, Jobs and
Innovation. + }
  SECTION 8.  { + (1) The Energy, Jobs and Innovation Bond
Administration Fund is established in the State Treasury,
separate and distinct from the General Fund. The Energy, Jobs and
Innovation Bond Administration Fund consists of:
  (a) The amount of revenue bond proceeds remaining after
depositing the net proceeds in the Energy, Jobs and Innovation
Bond Fund pursuant to section 6 of this 2011 Act;
  (b) The proceeds of revenue bonds issued to pay bond-related
costs;
  (c) Any funds appropriated or allocated to the Energy, Jobs and
Innovation Bond Administration Fund; and
  (d) Investment earnings received on moneys in the Energy, Jobs
and Innovation Bond Administration Fund.
  (2) Moneys in the Energy, Jobs and Innovation Bond
Administration Fund are continuously appropriated to the Oregon
Innovation Council for paying bond-related costs during the term
of revenue bonds issued under section 5 of this 2011 Act.
  (3) The Oregon Innovation Council, in consultation with the
Oregon Business Development Department and the State Treasurer,
may use amounts in the Energy, Jobs and Innovation Bond
Administration Fund to pay bond-related costs during the term of
revenue bonds issued under section 5 of this 2011 Act. Amounts in
the bond administration fund must be disbursed upon the written
request of the Oregon Innovation Council in consultation with the
Oregon Business Development Department. + }
  SECTION 9.  { +  + } ORS 284.740 is amended to read:
  284.740. (1) The Oregon Innovation Council   { - shall - }
 { +  may + } establish   { - a - }  { +  one or more + }
signature research   { - center - }  { +  centers + } to maximize
collaborative ventures among research institutions, the federal
government and private industry that will capitalize on
opportunities to obtain private and federal funding for
 { - the - } research and development of { + :
  (a) + } Nanoscience and microscience products, technology and
multiscale materials.
   { +  (b) Solar energy, green building products and services,
biofuels, biomass energy, bio-based products and other renewable
and sustainable energy technologies. + }
  (2) The council may contract with   { - a private,
not-for-profit corporation - }  { +  a nonprofit entity  + }for
the administration of the
  { - center - }  { +  centers + }.
   { +  (3) Signature research centers, emerging businesses,
research institutions and Oregon clean energy businesses, as
defined in section 3 of this 2011 Act, contracting to develop
business endeavors, or to conduct research within a signature
research center may receive grants and loans from moneys in the
Oregon Innovation Fund created under ORS 284.720, the Oregon
Commercialized Research Fund created under ORS 284.725 or the
Oregon Fund for Energy, Jobs and Innovation established under
section 2 of this 2011 Act. + }
  SECTION 10.  { + Section 11 of this 2011 Act is added to and
made a part of ORS chapter 757. + }
  SECTION 11.  { + (1) As used in this section:
  (a) 'Clean energy' has the meaning given that term in section 3
of this 2011 Act.
  (b) 'Public utility' has the meaning given that term in ORS
757.005. 'Public utility' also includes a consumer-owned utility
as defined in ORS 757.270.
  (2)(a) A public utility shall collect funds for clean energy
economic development in an amount determined under paragraph (b)
of this subsection.
  (b)(A) The Public Utility Commission shall establish the amount
to be collected by each public utility in calendar year 2012 from
public utility consumers, and the rates to be charged to the
consumers served by the public utility, so that the total
anticipated collection for clean energy economic development
under this section in calendar year 2012 is $16 million. In
calendar year 2013 and subsequent calendar years, the commission
may not change the rates established for public utility
consumers, but the total amount collected in a calendar year for
clean energy economic development under this section may vary
based on utility usage by public utility consumers and changes in
the number of public utility consumers in this state.
  (B) Notwithstanding subparagraph (A) of this paragraph:
  (i) A public utility consumer may not be required to pay more
than $___ per month for a clean energy economic development
charge under this paragraph.
  (ii) An industrial or commercial utility consumer may not be
required to pay more than $___ per month for a clean energy
economic development charge under this paragraph.
  (c) Funds collected by a public utility for clean energy
economic development under this subsection shall be paid to the
Oregon Innovation Council for the Oregon Fund for Energy, Jobs
and Innovation established under section 2 of this 2011 Act. The
council's cost of administering this section shall be paid out of
funds collected for the clean energy economic development charge
under this section. + }
  SECTION 12.  { + This 2011 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2011 Act takes effect on
its passage. + }
                         ----------