House committee hears farmers, LRO on six-year extension of crop-donation tax credit

The House Committee on Revenue opened a public hearing Tuesday on House Bill 2,097, a six‑year sunset extension of the crop‑donation tax credit that provides growers a credit equal to 15% of the donated crop’s wholesale market value.

The bill would extend without policy changes an existing nonrefundable income tax credit intended to encourage producers to donate food to charities that serve people experiencing hunger. Kyle Easton of the Legislative Revenue Office told the committee the credit offsets collection, transportation and storage costs and is claimed by crop growers who donate food to qualifying nonprofit food banks or other charitable organizations.

The Legislative Revenue Office added that the credit is nonrefundable, may be carried forward (three‑year carryforward was identified during questioning), and has generated roughly $200,000 in annual revenue loss in recent years. "It'll be about $200,000 per year going forward," Easton said while presenting historical use and cost data and a report attached to the committee materials. Easton also explained the interaction between the state credit and claimed deductions at the state and federal level, showing an illustrative example in which a $5,000 donation produced a $750 state credit and additional tax savings from deductions depending on a donor’s tax situation.

Farmers who testified described operational details and costs of donating produce and urged the committee to retain — and consider expanding — the credit. Haley Rattenklaw, who farms in Yamhill and Polk counties, described coordinating empty totes, multiple trips to collect and deliver donated product and the labor involved: "That hundred dollars covers at least 10 hours of my time to go get the trailer, get it loaded, get it delivered," she said, describing one harvest of 5,123 pounds valued at about $666. Molly McCarter, a fourth‑generation grower, told the committee her operation donated 6,445 pounds of cauliflower in a recent year and cautioned that the tax credit does not fully offset production costs for donations.

Committee members asked the Legislative Revenue Office for more detail on who claims the credit and whether donations come mostly from large farms, small farms or garden‑scale donors. Easton said the report lacks a size distribution for claimants but staff could attempt to match donation records to tax filings to better describe the mix. Representative Reschke asked whether the donation must go to a nonprofit; Easton said qualifying recipients are charities or nonprofit food banks that distribute to people in need.

Several members and witnesses described Farmers Ending Hunger, a private nonprofit that coordinates donations from growers and processors; testimony noted prior partnerships with processors that facilitated frozen commodity donations but that recent processing changes have shifted more donations to fresh distribution. No vote was taken; the committee closed the public hearing and moved on to other bills.

The hearing included no final action on the bill; staff indicated the bill as filed is a six‑year extension of the existing credit with no policy changes.