Oregon’s strange and interesting higher ed tax credit auction

Instead of raising taxes to fund higher education, Oregon is holding a tax credit auction. You bid on a $500 tax credit, which you can then use, dollar for dollar, to offset your state income tax payments. The bid “contributions” go to support HECC grants for low SES college students. The minimum bid is $450, and there are $1.49M in credits for sale. I’m guessing these will sell at 95% percent of par, meaning this program will cost the state’s general fund $1.49M plus administrative costs, and raise about $1.42M for higher ed.

Let’s call it a $100K net loss to the state. If anyone understands why the state would do this rather than just appropriate $1.59M, please post a comment.

REMINDER: College Opportunity Grant Tax Credit Auction on February 10-12 to Benefit Need-Based Financial Aid 

Instructions will be made available on the Oregon Department of Revenue website on how to bid online.
Salem, OR – The Higher Education Coordinating Commission (HECC) is pleased to announce that a second College Opportunity Grant Tax Credit Auction for tax year 2019 will run on February 10-12, 2020.  A College Opportunity Grant Tax Credit auction for tax year 2019 was also previously conducted in December, 2019.

In 2018, the Oregon Legislature passed legislation creating a tax credit auction for contributions to the state-administered Oregon Opportunity Grant (OOG) fund. The auction gives Oregon taxpayers the opportunity to benefit from state tax credits while supporting a state financial aid program for Oregon students.

  • WHO: Individuals and businesses with Oregon income tax liability are eligible to place bids on tax credit certificates. The Auction is administered by the Oregon Department of Revenue (DOR). The contributions will go to the Oregon Opportunity Grant, which is administered by the HECC Office of Student Access and Completion. Interested parties should subscribe here for updates to the College Opportunity Grant Tax Auction email list.
  • WHAT: Modeled after the Oregon Film and Video Office tax auction, the College Opportunity Grant Tax Credit program is held online. The State is authorized to issue up to $14 million worth of tax credits per year, and will be authorized to issue $1.49 million during the February auction. The credit certificates will be in $500 increments and the minimum bid amount has been reduced from the prior year minimum to $450.
  • WHEN: The online auction is open from February 10-12, 2020. The bidding begins at 9 a.m. Pacific Daylight Time (PDT) February 10, 2020, and ends at 5 p.m. PDT, February 12, 2020.
  • WHERE:  Instructions on bidding will be available on the Oregon Department of Revenue (DOR) Tax Credit Option webpage here prior to the auction. The bids must be made online on the Oregon DOR website according to the DOR instructions. There is not a physical auction event.
  • WHY: Individuals and businesses with an Oregon income tax liability may bid on certificates and claim the credits on 2019 state tax returns.  Any amount not allowed on a 2019 return can be carried forward up to three years. The contributions will increase funding for the Oregon Opportunity Grant, the state’s longstanding need-based grant program for postsecondary education. The OOG is critical to supporting college affordability for approximately 35,000-40,000 students a year, but state funding for the OOG has for years been insufficient to support the college costs of all eligible students. The contributions from the auction will be used to increase the number of grants to eligible low- and middle-income students, increase the value of the per-student award, or a combination of both options, beginning in fall 2020.
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2 Responses to Oregon’s strange and interesting higher ed tax credit auction

  1. wild guess says:

    Are tax credit certificates tax deductible? Could you use it to reduce your federal tax liabilities? If so they may be worth more than $500.

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