SALEM – Oregon lawmakers are on track to scale back or eliminate several popular tax breaks this year, a decision that could boost state revenue by more than $100 million in future budgets.

Tax credits for solar projects, e-commerce and wolves killing livestock would go away under a plan approved by the Joint Committee on Tax Credits Wednesday, while lawmakers plan to extend support for rural doctors and affordable housing. The committee voted 11-3 in favor of House Bill 2066, which now heads the House for a vote.

Legislative economists predict that letting most of the tax breaks expire could cost taxpayers who use them roughly $20 million over the next two years, while the state would have that much more revenue available to spend. The state's revenue boost from eliminating the breaks will likely surpass $100 million by the 2021 budget cycle, they estimate.

Sen. Mark Hass, the Beaverton Democrat who led the Legislature's efforts to overhaul Oregon's corporate tax system, said lawmakers are scaling back tax breaks as a result of the failure to advance a corporate tax plan this session.

"I think this is a responsible set of priorities we have here, given a very, very tight budget," said Hass, co-chairman of the tax credit committee.

Several Democrats on the committee, including co-chairman Rep. Phil Barnhart, bemoaned the decision not to extend the life of a tax incentive for people to install solar power devices on their homes. It would be the largest tax break the Legislature is allowing to expire. A plan to partially extend it could have saved homeowners who install solar panels $2.7 million over the next two years, with the savings – and the state's potential lost revenue – climbing to $22 million in the 2021-23 budget cycle, according to Barnhart and Legislative Revenue Officer Paul Warner.

"I'm very disappointed that we didn't get there," Barnhart said. "I think it's a problem for this young industry."

Rep. Pam Marsh, a Democrat from Ashland, said she too was "deeply disappointed" the residential solar tax credit was allowed to expire, after a major push by supporters in recent weeks. "I think it is very unfortunate to be walking away from the state's commitment to that nascent industry," Marsh said.

Barnhart voted yes on the bill, despite his misgivings. But Marsh was among three of eight Democrats on the panel who voted no. All Republicans committee members voted yes. Rep. Diego Hernandez, D-Portland, and Rep. Barbara Smith Warner, D-Portland, also voted no.

It was unclear until Wednesday, when the committee passed the bill extending certain credits, whether the Legislature would preserve the expiring tax incentive for doctors to practice in rural areas of the state.

In the end, lawmakers extended the rural health care provider tax credit but restricted its use to physicians whose annual adjusted gross income is $300,000 or less. There are exceptions for general surgeons and providers who specialize in obstetrics or are family or general practice providers of obstetrical services.

Here are the other tax breaks the Legislature will extend, if both chambers pass House Bill 2066:

>>Reservation enterprise zones for federally recognized Indian tribes in the state

>>Tax credit for affordable housing lenders

>>Incentive for biomass energy from cow manure

>>Credit for installing fish screens, which keep fish out of water systems where they could be killed

The bill will also end the ability of C corporations that pay only the minimum income tax to use credits against those bills, which has been described as the Con-way loophole. The multinational logistics company filed and won a tax lawsuit that established the legal right for firms to use the credits to avoid paying even the minimum tax.

The Legislature also extended incentives to the film industry earlier in the session, by passing a separate bill, House Bill 2244.

-- Hillary Borrud

503-294-4034; @hborrud