Authorize submission of a minor boundary change request to the State of Oregon to amend the Portland Enterprise Zone boundary

This item requires a resolution from Council directing Prosper Portland to apply for a boundary amendment to the existing Portland Enterprise Zone. The Port of Portland approached Prosper Portland with a request that the boundary of the Portland Enterprise Zone be amended to add certain real property that is located at the Portland International Airport, to support economic development activities at that location. ​ The Enterprise Zone program is a property tax abatement program administered by the State of Oregon. Sponsored by Oregon municipal or tribal governments, a State Enterprise Zone can serve as a focal point for local development efforts. There are currently 73 Enterprise Zones creating opportunities for business investment across Oregon: 55 rural and 18 urban. Eligible businesses receive an abatement on increased property taxes on new investments in construction or equipment for up to five years. The City of Portland is the zone sponsor with Prosper Portland administering the program. To participate in the E-Zone program, eligible businesses must create new or additional jobs, agree to community public benefits, and pay program and public school fees that go towards public benefit activities and other economic opportunity programming.

The Enterprise Zone program does not in and of itself decrease projected growth in property taxes. The five-year property tax abatements only apply to new capital investment. Once the tax exemption expires and taxable property value grows, property tax revenues collected by local taxing jurisdictions will increase.

The Port of Portland, in partnership with Alaska Airlines, is pursuing the development of a new maintenance operations hub at Portland International Airport. This expansion is a $150 million estimated investment and projected to create at least 100 new living wage jobs for maintenance workers, engineers, and service professionals. ​ An estimated 55 to 60 workers will be employed as line maintenance technicians, inspectors, and supervisors, earning an average salary of about $120,000. Forty-five employees will work in receiving, processing, and shipping aircraft parts, with an average salary of about $50,000. Up to 8 staff will be employed in technical engineering positions with an average salary of $160,000. ​ According to Business Oregon, the seven-year return from Enterprise Zone businesses in the city of Portland equates to: ​ 3,600 new living wage fulltime jobs (10% increase required, 30% increase realized); ​ 2.2% business tax on applicable revenue; ​ $80.6 million income tax to the State of Oregon; ​ $7.8 million for the Workforce Training & Business Development Fund; and ​ $960 million in procurement within Portland. Business Oregon estimates that the seven-year average forgone property tax revenue totals approximately $1.9 million to the City General Fund (and a total of $13.6 million in forgone tax revenue). The cost per job would be $1,513 with an estimated "payback" of forgone revenue equaling five years following the abatement expiration.

When the Portland Enterprise Zone was re-authorized in 2019, as required by Oregon State Statue, numerous entities were involved with as a Technical Advisory Committee. This includes Multnomah County, Multnomah County Tax Assessors, Port of Portland, and Worksystems, Inc. Engagement for this minor boundary amendment included the Port of Portland and the Multnomah County Tax Assessors office.​​