Next Up at City Council, 3/5/08 – Enterprise Zones

I worked from 7 a.m. to 2 a.m. yesterday. This morning, my first coherent thought after the first mug of coffee was, “Hey, I get to write Next Up at City Council this morning!”, with a rush of enthusiasm rather than tired resignation. Then when I read the first item on the Portland City Council Agenda for March 5, my reaction was, “Cool! The report on Enterprise Zones is done!”

I am clearly not the average Portlander. Each to their own, huh?

The Council meets Wednesday morning and afternoon this coming week. On Wednesday morning:

292 TIME CERTAIN: 9:30 AM – Approve the Enterprise Zone Policy and authorize the Portland Development Commission, on behalf of the City, to act as the E-Zone manager and apply for a 10 year E-Zone designation from the State of Oregon

Enterprise Zones are the lesser-known cousin of Urban Renewal Areas. They promote job creation on industrial sites. From the Report: “The Oregon Enterprise Zone program is a State of Oregon economic development program, as provided by the Act, that allows for property tax exemptions designed to encourage existing and new firms to invest in new capital outlays in certain designated areas. In exchange for receiving the property tax exemptions, participating firms are required to meet certain program requirements as described in the Act and any additional requirements as set by local jurisdictions.”

Portland’s Enterprise Zone program gives a five year 100% property tax abatement, managed by the Portland Development Commission. The boundaries are mostly along the Columbia and Willamette Rivers, west of I-205, east of Forest Park, and north of I-84. Most of the proposed area carries industrial zoning and is contiguous, although there are a few detatched slivers running along specific arterials in North/Northeast Portland.

In the version of the program that ran from 2000 to 2007, thirty-five companies invested $437 million and created or retained 4,300 jobs, in return for a total property tax abatement of about $26 million. Companies receiving the benefit include the Banfield Pet Hospital headquarters on NE 82nd with $22 million investment, $1.57 million tax abatement; and Solaicx solar panels, $57 million expenditure, $3.5 million rebate. I am very pleased that the evaluation study was done, and that it supports continuing the program. This is a Portland Development Commission project that helps neighborhoods outside of Urban Renewal Areas.

From the Resolution:

“The Oregon Enterprise Zone Act, ORS 285C.050 – 285C.250, authorizes the designation of Enterprise Zones in urban and non-urban areas and provides that property tax abatement, job creation, and local municipal incentives are desirable to stimulate economic development in economically depressed areas.

The Portland City Council sponsors the Portland E-Zone program to facilitate investment by predominantly industrial-based businesses in Portland in order to create or retain quality jobs while maximizing the economic benefits for residents of Portland who are currently earning at or below 80% Median Family Income”

The proposed Enterprise Zone is located entirely in a “Distressed Area” as defined by the Oregon Economic and Community Development Department. The unemployment rate within the Enterprise Zone is 10.3% compared with the State wide unemployment rate of 7.9%, and the percentage living below poverty is 16.2% compared with the statewide average at 11.5%.

Two of the goals of the program:

* Ensure that the jobs being created meet basic job quality and retention requirements per the E-Zone Policy and State requirements, and

* Ensure that participating firms are increasing overall employment by at least ten percent (10%) during the first year the firm receives abatement.

The Agreement includes standards that must be met, as well as aspirational goals and specific requirements on child care, transit use, and more. Among them is that companies must provide levels of pay above minimum wage, as well as benefits including health care insurance. Companies receiving the tax abatement are required to contribute to the cost of “the City’s basic services such as police and fire” coverage for new facilities. Both a Board and a Technical Advisory Committee are established to oversee implementation. It looks like a good, well-rounded, thoughtful program to me – evidence-based, with appropriate oversight and consequences for success and failure.

Ok, back to the rest of the Portland City Council Agenda:

Having reviewed Enterprise Zones in depth, my time is up. So here are some of the other important items that catch my attention, simply listed:

*293 TIME CERTAIN: 10:00 AM – Adopt budget adjustment recommendations and the Minor Supplemental Budget for the FY 2007-08 Winter Budget Adjustment Process and make budget adjustments in various funds

Organized citizens pressuring for particular projects have succeeded in making amendments at this stage in past budget processes.

*307 Release $200,000 in grant funds to VOZ Workers’ Rights Education Project to operate a day labor hire site in Portland as approved by Council

311 Expand the City Equal Benefit requirements to include contract amendments and revenue generating contracts

314 Authorize $275,000 for the purchase of an electronic pawn and secondhand reporting system

I heard this past week that Washington state has better oversight of resale outlets that reduces fencing of stolen goods, so I hope this purchase is a step in the right direction.

*315 Authorize a Sponsorship Agreement with Little League Baseball, Inc. to contribute $50,000 to Portland Parks and Recreation for the construction of improvements at Lents Park

A hot topic in Lents, in outer Southeast Portland.

316 Designate Block U bounded by NW Irving St, NW Broadway, NW 6th Ave and NW Hoyt St and owned by the Portland Development Commission for the development of the Resource Access Center and affordable housing

Really, Block U? Any advance on Block U? Going once, going twice….

WEDNESDAY, 2:00 PM, MARCH 5, 2008

320 TIME CERTAIN: 2:00 PM – Accept Parks System Development Charge Methodology Report for implementation and amend the applicable sections of code (Ordinance introduced by Commissioner Saltzman; amend Code Chapter 17.13)

So many interesting items on the Agenda this week. Especially, for those of us passionate about how Portland’s money is raised and spent. And that includes many “average” Portlanders, right?