The following is based on and excerpted from the Bend Bulletin.
A number of Oregon companies, nonprofits and government agencies in Oregon have benefited from the Business Energy Tax Credit, known as BETC, or “Betsy.”
Critics of the BETC say that program is too generous and that it does not deliver on its promises of economic development.
Oregon Governor Kulongoski’s spokeswoman Anna Richter Taylor said the governor is focused on improving the program, as evidenced by new rules governing the program. “The governor agrees that it’s time to review the program and its economic benefit to the state,” she said.
For proof of that benefit, BETC supporters point to a February 2009 study done for the energy department by the Portland consulting firm ECONorthwest. Among its conclusions: that $73 million of tax credits in 2007 created 900 more jobs than if the money had been spent on other state-funded programs.
But Eric Fruits, a conservative economist who teaches at Portland State University, is not impressed. Using Oregon’s public records law earlier this year, he obtained an earlier draft of the report that did not paint the same picture of unblemished success.
Instead, the draft ECONorthwest report showed that for some types of BETC spending, the money would have produced more jobs if invested in other state programs.
Fruits also obtained a Jan. 16 e-mail from the study’s author, Stephen Grover, noting the mixed results, and asking the Energy Department’s then-assistant director whether he should change the report. He offered to combine categories in the final draft, thus making the negative results go away.
In the end, that’s what happened. The final report showed only positive impacts of the program.
Asked about the e-mail, Grover said the changes were intended to correct for potential inaccuracies. He said that such changes are common in presenting a report.
But when directed to Fruits’ blog, which details the changes to the draft, Sen. Chris Telfer, R-Bend, called it “disappointing.” “You’ve got my blood boiling now,” she said.
Read the full story in the Bend Bulletin (registration required).