Friday, August 28, 2015
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CREDITS: $703.6M in energy tax credits sold to investors from 2006-2014
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East Oregonian
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cents on the dollar as negoti-
ated by Blue Tree Strategies’
client Sky Lakes Medical
Center in Klamath Falls. Two
other clients, public transit
providers in southern Oregon,
had arranged to sell their tax
credits for 80 cents on the
dollar, rather than 95 to 98
cents under a pricing formula
required in state law.
For Blue Tree Strategies
and its clients, the knowledge
they could negotiate deeper
discounts was a competitive
advantage: they could market
tax credits that were less
expensive and therefore more
attractive to buyers. Energy
of¿cials’ decisions to allow
the lower negotiated prices
also meant the tax credits
raised less money for the
energy ef¿ciency proMects
lawmakers wanted to incen-
tivize.
Close ties
Blue Tree Strategies has
ties to the Department of
Energy going back to at least
the start of then-Gov. John
Kitzhaber’s third term, when
the ¿rm landed a contract with
the nonpro¿t Clean Energy
Works Oregon to promote the
state’s Cool Schools energy
retro¿t program to school
districts. The consultants
also administered grants to
supplement the state program.
The department runs Cool
Schools, which was part
of Kitzhaber’s Mob creation
platform during his 2010
campaign. It helps schools to
install new energy-ef¿cient
technology such as lighting
and heating, ventilation and
cooling systems.
Blue Tree Strategies also
interacted with the city of
Portland, the governor’s
of¿ce and Clean Energy
Works Oregon even before
the Cool Schools contract.
Aaron Berg, the compa-
ny’s founder and owner,
contracted with the city of
Portland in 2010 to help
launch Clean Energy Works
Oregon, which got its start
with $20 million in federal
economic stimulus money.
The Kitzhaber administra-
tion was interested in the
nonpro¿t’s work and while
Berg was Clean Energy
Works Oregon’s chief ¿nan-
cial adviser, the governor’s
business adviser Scott Nelson
attended the nonpro¿t’s
meetings.
Consultants working for
Blue Tree Strategies also
included Matthew Collier and
John Warner, who previously
worked at the Portland Devel-
opment Commission. Collier
and Warner also marketed tax
credits through the corpora-
tion RDTFM, Inc.
Together, Blue Tree Strat-
egies and RDTFM, Inc. have
lined up more than two dozen
tax credit sellers, including
several local governments,
and approximately 50 buyers
since they started brokering
tax credits in 2009. Public
clients included the Port of
Portland, Metro regional
government, TriMet transit
agency and Columbia and
Marion counties. RDTFM,
Inc. dissolved in 2014 and the
consultants now all work for
Blue Tree Strategies.
Berg doesn’t characterize
Blue Tree Strategies as a
maMor broker of Oregon
energy tax credits. Nonethe-
less, Berg said, the Blue Tree
Strategies and RDTFM, Inc.
has helped sell approximately
$15 million in state energy
tax credits as of early August.
The Portland Bureau of
Transportation alone sold
roughly $2 million worth of
tax credits through Blue Tree
Strategies.
Still, Berg said, “we’re not
a big player in this.”
Berg pointed to ¿gures
reported by EO Media
Group/Pamplin Media Group
Capital Bureau, that $703.6
million in Oregon business
energy tax credits were sold to
investors from 2006 to 2014.
The Department of Energy
was also still facilitating tax
credit sales during that period.
Other tax credit brokers
were mostly accounting
¿rms, lawyers and ¿nancial
advisers, according to chief
¿nancial of¿cer Anthony
Buckley and state records.
Local governments and
private clients paid the two
¿rms hundreds of thousands
of dollars for facilitating the
sale of their credits. According
to public records, Blue Tree
Strategies and RDTFM, Inc.
charged a commission of 2
percent to 10 percent on the
tax credit sales.
Berg said Blue Tree
Strategies started to broker
tax credit sales after meeting
people who were struggling
to ¿nd buyers.
“We didn’t seek it out,”
Berg said. “Our experience in
the ‘09, ‘10, ‘11 days was our
clients had a problem. And
their problem was (Oregon
Department of Energy)
wasn’t selling their credits for
them. But for that problem,
we would never be in this
business.”
Rachel Wray, a spokes-
woman for the Department
of Energy, said it was dif¿cult
for the agency to keep up
with demand for buyers
after the state expanded the
program. The Legislature
passed a maMor expansion
of the business energy tax
credits in 2007 at the urging
of then-Gov. Ted Kulongoski.
Then, after it became clear
the business energy tax credit
would cost the state far more
in lost revenue than energy
of¿cials had promised,
lawmakers voted to end that
tax credit in 2011. Energy
of¿cials shifted their focus
away from helping energy
proMects ¿nd buyers for their
tax credits.
Blue Tree makes
connection
Around the same time,
Blue Tree Strategies secured
the 16-month $106,000
contract through Clean
Energy Works to promote
Kitzhaber’s Cool Schools
energy retro¿t program and
administer
supplemental
grants to schools. Steph-
anie Swanson, director of
marketing for Clean Energy
Works, said the federal stim-
ulus funds carried a require-
ment to spend some of the
money on proMects that would
increase energy ef¿ciency for
commercial buildings.
Blue Tree Strategies coor-
dinated with the state during
the Cool Schools proMect and
Berg said he consulted with
Buckley, the energy agency’s
chief ¿nancial of¿cer, about
the state’s plans for the
program. Part of the Mob was
to sign school districts up for
the state program: Collier
wrote in his resume that he
“led an effort to support the
success of the Oregon Cool
Schools Initiative to help
school districts ¿nance the
installation of energy ef¿-
ciency measures under the
(state’s) Small-Scale Energy
Loan Program.”
Buckley, who oversees
the Department of Energy’s
tax incentive, energy grant
and loan programs, did not
respond to questions about
when he met Berg and
Collier.
The negotiated price
deals Blue Tree Strategies
and its clients pushed the
state to allow this year date
back to 2014, when Buckley
told Blue Tree Strategies the
¿rms’ clients could ignore
tax credit price mandates in
state law and published rules.
Buckley said his interpreta-
tion of the law was based on
discussions with the Oregon
Department of Revenue
and Oregon Department of
Justice. The energy agency
has refused to release a copy
of the Department of Justice
opinion on the issue.
Although Blue Tree
Strategies’ clients struck
deals based on Buckley’s
advice, another Department
of Energy employee stood in
the way.
Joe Colello, who handled
tax credits and other renew-
able energy and ef¿ciency
incentives at the agency,
wanted Kaplan or the Depart-
ment of Justice to con¿rm the
agency could legally process
deals that appeared to violate
the pricing formula mandated
in state law. The Department
of Energy was also under
increased pressure to take a
public position on whether
it would allow the deep
discounts, because Colello
had discussed the issue with
a tax auditor at the Depart-
ment of Revenue and other
brokers had heard rumors the
energy agency was allowing
the deals. In January, Senior
Manager Irina Antonache
at the accounting ¿rm Moss
Adams emailed Colello to
ask if the state was allowing
deeper discounts on the tax
credit sales than allowed
under state rules. Colello
responded that an uniden-
ti¿ed broker had indeed
arranged for deeper discounts
and Buckley was involved in
those discussions.
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WORLD BRIEFLY
Planned Parenthood alleges ‘smear’
in letter to Congress
LOS ANGELES (AP) — Planned Parenthood Federation of
America defended its practices Thursday in a lengthy letter to
congressional leaders and included a report by experts it hired
who found undercover videos of of¿cials discussing fetal tissue
for research were heavily altered by anti-abortion activists.
The report supports the organization’s claims that the
secretly recorded videos were distorted to misrepresent
conversations employees had with anti-abortion activists
posing as biomedical company employees interested in buying
fetal tissue, Planned Parenthood said.
The letter and report were the most detailed defense to
date by Planned Parenthood, which has come under ¿re from
conservatives since the California-based Center for Medical
Progress began releasing a series of undercover videos last
month.
“It’s increasingly clear that this attack on Planned
Parenthood is a fraud based on a web of lies and deception,”
Executive Vice President Dawn Laguens told reporters.
Four congressional committees are investigating Planned
Parenthood’s practices, and lawmakers unsuccessfully tried to
strip the organization of federal funding.
Trump risks deepening GOP rift
on immigration
WASHINGTON (AP) — Donald Trump has exposed anew
the deep rift inside the Republican Party on immigration, a
break between its past and the country’s future the party itself
has said it must bridge if the GOP ever hopes to win back the
White House.
As they headed into the 2016 election, Republicans
thought they had a strategy for moving past their immigration
woes. Outlined in a so-called “autopsy” of 2012 nominee
Mitt Romney’s loss to President Barack Obama, it called for
passing “comprehensive immigration reform” — shorthand for
resolving the status of the estimated 11 million people living in
the country illegally.
Those plans ran aground in the GOP-controlled House,
falling victim to the passionate opposition among conservatives
to anything they deem “amnesty” for such immigrants.
Some Republicans then hoped candidates with more
moderate positions on immigration — such as Jeb Bush, the
Spanish-speaking former Florida governor, or Sen. Marco
Rubio, a Miami native and son of Cuban parents — would
rise during the 2016 campaign and boost the party’s appeal to
Hispanic voters.
Instead, it’s Trump — with his call to deport everyone living
in the U.S. illegally and eliminate birthright citizenship — who
has surged to the top of the summertime polls, reinforcing
the lasting power of white, conservative voters who the GOP
has courted for decades and continue to dominate the party’s
presidential primaries.
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