Metro and the Portland Business Alliance are calling for the state to offer loans to local governments, in an effort to produce more so-called shovel-ready employment sites.
A bill, proposed by the alliance and Metro, would require the state to offer loans to local governments to prep industrial sites. The loans would be written off if a major employer, meeting certain criteria, sets up shop at the site.
The proposed bill would only offer loans to governments who agree to a set of principles, and would only forgive loans if they resulted in landing employers that met specific criteria. The employer would have to be new to the state, pay average-or-better wages and operate in a traded-sector industry.
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Money for the loans could be used to acquire sites, make transportation improvements, mitigate environmental impacts, level sites and build pipes needed for the projects. It wasn't immediately clear how legislators would initially fund the program, nor how much money could be in the fund's initial budget.
Alliance vice president Bernie Bottomly and Metro Council President Tom Hughes spoke at a hearing of the Oregon House Committee on Transportation and Economic Development on Sept. 12, warming lawmakers up to the notion of state intervention on industrial land preparedness.
Local leaders have been increasingly frustrated in their efforts to recruit new businesses to Oregon. At the September House committee hearing, legislators were told that many other cities have sprawling, turnkey sites ready to offer to potential employers.
With sprawling greenfields not an option for business recruitment in Oregon because of the state's strict land use laws, business leaders are now focusing on ways to get industrial sites already within the urban growth boundary quickly ready for turnaround.
Only nine sites in the Portland region could be ready to turn over to a potential employer within six months, Bottomly said.
At the Sept. 12 hearing, Hughes said that is not enough.
"If we had a prospect today, if we had to take one of those prospects out today and say 'Here's a parcel of land, it'll be available to you as soon as we first clean up the contamination and second of all, get it certified by the federal government that it's acceptable for your use,' they would probably smile and go someplace else," Hughes said.
Bottomly then came to the Metro Council on Sept. 25 to further explain the proposal, which is the next step of a months-long effort to look at how to prepare land for potential new employers.
The study, sponsored by the alliance and Metro, found that cities and counties have little financial incentive to spend millions preparing industrial sites for potential employers.
"The local folks, whether it's a port district, the PDC, a city or a county, they're doing all the work to buy the lottery ticket," Bottomly said. "When the number comes up, the state gets all the money."
How? Bottomly said new factories don't turn around a tremendous amount of property tax revenue that feeds local coffers. But the recruitment of a major employer onto an industrial site, brownfield or greenfield, results in a significant income tax pickup at the state level.
For example, a site in Hillsboro that could attract 1,700 new employees would cost $16 million to prepare with the infrastructure needed to declare it shovel-ready.
In the 20 years that follow an employer setting up shop at that site, local governments would net $35 million in property taxes. But the employees of the site would pay $153 million in income taxes in the same time frame.
"So it would benefit the state to come in and invest in that site and accelerate that development so they're getting the revenue sooner," Bottomly said.
If all 12 sites looked at in the study were to develop, the state would realize an extra $764 million in income tax revenue, Bottomly said.