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Oregon House OK’s Bill Boosting Tax Credit for Retrofits

By Dan Leone, Staff Reporter

This story appears in the June 11 print edition of Transport Topics. Click here to subscribe today.

The Oregon House of Representatives has unanimously approved legislation that would boost tax incentives and provide grants for truckers to pay for diesel engine retrofits.

“We currently have a 35% credit for retrofitting, and we get the sense from talking to folks that it’s not enough,” said Kevin Downing, a spokesman for the Oregon Department of Environmental Quality. “It will be raised to 50%” under the new bill, he said.

The proposal would allow a single trucking company to claim a maximum of $80,000 a year in tax breaks.

The bill, which passed the House in May, is currently in the Ways and Means Committee of the Oregon Senate.
The measure has the support of the Oregon Trucking Associations, said association President Bob Russell.

“We love the bill,” he said.

Downing noted that while Oregon has offered tax breaks for retrofits for several years, the new legislation would, for the first time, create a pool of state funds that truckers may draw on to purchase clean diesel technology.

The bill also would offer some grants and loans, which could cover up to 100% of the cost of retrofitting an engine, including costs associated with labor and scrapping older engines.

According to the bill, Oregon will take into account other financial incentives provided to truckers, such as existing tax-relief measures and federal grants, when issuing funds for retrofits. In addition, heftier grants and loans would be available to those seeking to retrofit older engines.

Downing added that the Department of Environmental Quality has currently budgeted about $1.5 million biennially to be put toward the new Oregon Clean Diesel Engine Fund that the bill would create.

To qualify for grants or tax incentives, any retrofits performed would have to reduce particulate matter emissions by at least 25%, the bill states.

Separately, the legislation keeps in place a provision that provides tax relief for truckers who purchase cleaner burning engines that have been certified by the Environmental Protection Agency to meet 2007 emission regulations.

Only engines purchased after the new proposal becomes law would be eligible for tax relief. The size of the tax break depends on the number of trucks owned by the party claiming the exemption.

A lone owner-operator purchasing a single truck would be eligible for a tax credit of $925. A trucking company buying more than 100 trucks would be permitted to claim a credit of $400 per vehicle, according to the bill.