Oregon OKs new tax break zones

Jonathan J. Cooper / The Associated Press

SALEM — Oregon is expanding the type of tax breaks that brought Facebook and Apple to Crook County.

The state announced Monday that it’s approved three new enterprise zones in struggling areas of Portland, Beaverton and Veneta, opening the door for businesses to earn tax breaks for investing in those neighborhoods. An existing zone in Springfield also was upgraded to allow more generous tax breaks.

They’re the first new enterprise zones created under a bill, approved this year by the Legislature, that allows up to eight new zones.

Businesses that build new operations or expand existing ones inside an enterprise zone can avoid paying property taxes on the value of their improvements, usually for three to five years. To qualify, they have to create at least one job, sometimes more.

An enterprise zone in Central Oregon has lured technology companies including Facebook Inc., to build a data center in Prineville, employing about three-dozen people with expansion plans in the works. Apple Inc. also has bought property and plans to build in the area.

Officials hope similar investments will happen in the new enterprise zones. The Legislature has now authorized up to 60 enterprise zones, including 48 that must be in rural areas.

Portland’s new enterprise zone in East Portland will be the city’s second, Mangan said, following an existing zone in North Portland.

“It’s a proven program for us. It’s been very successful in North, Northeast Portland over the past 15 years,” said Anne Mangan, a spokeswoman for the Portland Development Commission. “This ... is going to open some new doors toward helping with job creation and economic growth in that area,”

Officials in Veneta, east of Eugene, hope the enterprise zone will help create local jobs so more of its 4,600 residents don’t have to commute to bigger cities.

Veneta has been hurt by the decline of the timber industry, and the town also lost 200 jobs recently when BowTech, which makes archery equipment, left town, according to its application for an enterprise zone.

“We’ll be figuring out a strategy for how to advertise and coordinate with the other enterprise zones in Lane County,” said Kay Bork, associate planner in Veneta.

Proponents argue that tax breaks, like those offered in enterprise zones, make it possible for businesses to expand and create jobs. At any given time, about 200 businesses are benefiting from enterprise zone tax breaks in Oregon, said Nathan Buehler, a spokesman for the Oregon Business Development Commission.

Critics say they rob the government of tax revenue.