Property Tax Exemptions
Enterprise Zones
Central Oregon has two designated Oregon Enterprise Zones, in the communities of Prineville, Madras, and Redmond. This non-bureaucratic program is administered by the two participating municipalities and is designed to assist new manufacturing firms with expansion through 100% property tax exemptions on qualified investment (new buildings, remodels, and equipment) during the first 3 to 5 years of that investment. After the exemption expires, the building and/or equipment is picked up on the tax rolls at the depreciated rate.
For example, if a manufacturer invests $1 million in Redmond in new qualified investment, the company will save approximately $57,292 to $95,488 depending on the period of exemption. In Madras, that same investment qualified through the City, would result in a savings of $53,025 to $88,376 depending on the period of exemption. Five year exemptions are tied to above average wages (150% of average annual wages for the county) a figure that can also include elements of a benefit package.
The Redmond Enterprise Zone also offers an additional benefit package including:
100% waived fees for water deposit, water hook-up for sprinkler systems, domestic water, and sewer, as well as rock excavation deposit. Other waived fees include conditional use fees, partitioning fees, plan amendment fees, site and design review fees, and a variety of other public works related fees.
Discounted fees including: 25% reduction in monthly water and sewer usage charges, up to 25% discount on System Development Charges, and up to 75% off building permits.
“Super” Enterprise Zone
Prineville has the distinction of being one of only a handful of “super” enterprise zones in Oregon that are able to offer a qualifying manufacturer a complete facility and land property tax exemption for a period of 7 to 15 years. Additionally, super e-zone participants are eligible for income tax credits based on employment levels. Three threshold criteria exist to qualify for the program:
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Qualifying Criteria
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Prineville E-Zone
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Minimum Investment
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$5.55 million
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Minimum New Employment
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35 jobs
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Min. Compensation per Employee
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39,762*
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* Note: compensation is variable, figures are locked in when a company first meets requirement.
EDCO publishes tri-fold brochures for each enterprise zone in the region. To download a brochure in .pdf (Adobe Acrobat Reader), please click on the link below:
Prineville Madras Redmond
Small City Business Development Income Tax Exemption
Crook County has the distinction of being one of one four areas in Oregon that can offer a 10-year tax exemption to certain businesses that expand or establish new facilities in economically distressed communities. Through this program, any business can subtract the income/profits apportionable to a qualified facility from its overall taxable income. In order to qualify, a business must hire 10 or more full-time, year-round employees, in addition to its existing employment. At least 10 of these new employees must receive an annual compensation of 150% of County Per Capita Personal Income or 100% plus health insurance coverage equal to benefits of local city/county employees. The overall company must not operate another such facility outside the city but inside Oregon that does the very same thing, and must not compete with other existing business inside the city and/or county. Crook County and essentially Prineville (since qualifying projects must be within a community urban growth boundary), is the only area in Central Oregon that this income tax incentive is available.
Tax Credit Programs
Some states like California and Colorado have extensive tax credit programs to offset an overall tax system that has a higher than average tax burden on businesses. Oregon takes a different approach, working instead to keep the overall tax climate favorable for all businesses, not just those choosing to participate in special programs. Nevertheless, there are a few programs that exist, including:
Business Energy Tax Credits
This tax credit encourages investments in energy conservation, recycling, renewable energy resources, and less polluting transportation fuels. Any Oregon business may qualify. Projects may be in office buildings, stores, apartment buildings, manufacturing plants, farms, or transportation.
The tax credit is 35 percent of eligible project costs – the incremental cost of the system or equipment that is beyond standard practice. The credit is taken over five years: 10 percent in each of the first and second years, and 5 percent each year thereafter. For more information on this credit, contact the Oregon Office of Energy, (503) 378-4040.
Corporate Income Tax Credits
Businesses operating in Oregon may be eligible for tax credits related to preserving the state’s reputation for high environmental standards. These include:
- Pollution control tax credits
- Pollution prevention tax credits
- Reclaimed plastics product tax credits
For more information on these tax credits, contact the Department of Environmental Quality, (503) 229-6878.
Work Opportunity Tax Credits
The Vocational Rehabilitation Division of Oregon administers the Work Opportunity Tax Credit (WOTC) which offers employers up to a 35% one-time tax credit on the first $6,000 paid in wages per disabled employee hired. Tax credits are non-deferrable. For the Central Oregon region, contact Heather Lynch, Don Seiden or Linda Greaves at (541) 388-6336 for more details.
Dependent Child Care (Day Care) Tax Credits
Administered by the Oregon Commission for Child Care, if a company incurs 50% either in direct cash payments or vouchers, or through contracted dependent care referral services, it can take a tax credit up to cap of $2,500 per year/employee.
If an employer chooses to develop its own dependent care facility to benefit its employees, it may take the smallest of the following as a tax credit:1) 50% of the amount paid for acquisition, construction, or improvement of property to be used primarily as a dependent care facility serving employees, 2) $2,500 times the number of full-time equivalent employees, or 3) $100,000. For more information on these programs contact the Oregon Commission for Child Care at (800) 435-4127 or (800) 342-6712.
Other Tax Credits
Oregon also has Research Tax Credits and Technology Donation Tax Credits as incentives to promote technology growth and transfer. Research tax credits are designed to assist companies engaging in new research and development, while the latter is for any company interested in donating computers and scientific equipment in Oregon. For more information about these programs, contact the Oregon Department of Revenue, Corporate and Estate Section, (503) 945-8436.
Business Financing
Several special local, regional, state and federal loan funds exist to help new and existing Oregon businesses access resources. In helping companies with financing needs, Economic Development for Central Oregon always tries to direct business owners to the path of “least resistance” but which still have attractive (competitive) rates. Below is a brief outline of the programs available.
Oregon Industrial Development Revenue Bonds
This source, which is offered only to manufacturers, is the lowest cost financing available for projects ranging between $2 and $10 million (excludes working capital). Rates are 75%-80% of the most competitive market rates, which makes it the most affordable source of any available. There are only a few larger financial institutions in the Pacific Northwest that have significant experience in IDRBs, and EDCO has established relationships with all of them. Feel free to call the EDCO office for more details at (800) 342-4135.
Oregon Business Development Fund
Offering some of the best rates around (1% above U.S. Treasuries of similar maturity), this Oregon Economic & Community Development Department (OECDD) funded loan program is also designed specifically for manufacturers and other primary job providers. The program is non-bureaucratic and turnaround is excellent. Designed as a gap financing source, the maximum amount for a loan is $500,000 which can cover a limit of 40% of the total project, so other equity (owner or investor) or debt financing is required. To help bring together non-standard deals, OBDF will, in some cases, take a second on collateral. Call the OECDD finance team for more details at (503)986-0160.
Capital Access Program
Designed to help provide financing to businesses that have difficulty accessing capital through standard financial institutions, this program provides loan portfolio insurance so lenders may make loans that carry higher than conventional risks. Borrowers pay a fee between 3 and 7 percent of the loan amount, which is matched by the Oregon Economic & Community Development Department and contributed to a loan loss reserve account in an enrolled bank. The loans must be within the soundness and safety requirements of federal and state banking regulations. Loans can be made for virtually any business activity with the exception of refinancing existing business debt. Call the OECDD finance team for more details at (503) 986-0160.
Credit Enhancement
This program provides guarantees to enrolled banks to increase capital availability to small Oregon firms, helping them create jobs. Maximum guarantees are for $500,000, and the Oregon Economic & Community Development Department has the authority to guarantee up to $75 million of financial institution loans. OECDD charges a one-time up-front insurance premium for the program. Only manufacturing, distribution and non-retail firms with employment under 200 full-time employees are eligible. Call the OECDD finance team for more details at (503) 986-0160.
Entrepreneurial Development Loan Fund
Entrepreneurial businesses can get initial loans of up to $25,000 (with a possibility of an additional $15,000) for existing or new enterprises, provided the borrower :
- works with the local Small Business Development Center to prepare a business plan;
- has not been in business for longer than two years, and has revenues of $100,000 or less in the last year.
Borrowers are also required to contribute a minimum of an additional 20 percent equity in the form of cash, property or business equity. Call the OECDD Finance Team for more details at (503) 986-0160, or the Business Development Center at (541) 383-7290.
Intermediary Relending Program
Central Oregon Intergovernmental Council (COIC) also administers several loan programs including the Intermediary Relending Program (IRP) that offers loans of up to $150,000 or 75% of the total project for a variety of uses including building construction, land acquisition, machinery and equipment and permanent working capital. For more details, contact COIC at (541) 548-8184.
Revolving Loan Fund
Another of COIC’s loan funds, this funding source can provide a maximum of $150,000 at very competitive rates for both short and long term financing of real estate, equipment or working capital and is typically used in conjunction with bank financing.
For more details, call a COIC loan officer at (541) 548-8184.
Special County Loan Funds
Also managed by Central Oregon Intergovernmental Council, Deschutes and Jefferson Counties have developed special loan funds with very reasonable rates for businesses unable to access capital through other sources, businesses that have a gap financing shortfall, and start-up operations. Loans are made on a case-by-case basis for plant acquisition, machinery and equipment, working capital, and occasionally construction. Check with a COIC loan officer for availability and terms at (541) 548-8184.
SBA Loan Programs
The Small Business Administration has a variety of programs for emerging and existing businesses including the 7a and 504 Programs. The SBA 504 has quite affordable rates (approx. 2.5% over 10 treasury rates), is eligible only for fixed assets, and must be combined with bank or other financing (40% cap), but will take second security position behind bank financing. The SBA 7a Program can be used for fixed assets, equipment and working capital both for existing and start-up businesses. Rates on the 7a are slightly less favorable at 2.75% over prime. Maximum guarantee limits for both programs are $750,000. Check with a COIC loan officer for availability and terms at (541) 548-8184, or a participating financial institution.
Rural Development Business & Industry Loan Guarantee
Similar to the SBA, USDA Rural Development offers a guarantee program for larger business development projects in rural areas with populations under 50,000 residents. Up to 80% of loans of $1 million to $5 million are guaranteed, 70% from $5 - $10 million, and 60% for loans between $10 million to $25 million. Loans may be used for a broad range of activities including acquisition, construction, conversion, expansion, repair, modernization, development costs, equipment, machinery, start-up and working capital, pollution control, and refinancing in special cases. For more information on availability of the Rural Development guarantee program, contact Bob Haase at (541) 923-4358, Ext. 124.
Training
Workforce training is an increasingly important factor and incentive in today’s tight labor market. Although the region offers a competitive advantage for finding skilled employees, there are several programs to make finding or training workers easier and less costly. Listed below is a matrix of training and education programs available to new and existing businesses in Central Oregon.
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Program
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Provider
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Contact(s)
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Assistance
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Targeted Training Program
(Training Center)
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Central Oregon Community College
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Riki Strong
(541) 617-4601
or
Ray Hoyt
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Time and money. COCC can develop programs tailored to specific needs of a business, either credit or non-credit as defined by the company. These courses/curriculums such as computer application modules can be delivered in-house (at the company) or utilizing the campus or other logical location. In this way, the program helps save the firm time in development, as well as providing consistency to concentrated as well as on-going training. Financially, targeted training may be able to assist by helping shoulder the cost of training that will bring existing or new employees up to family wage levels (current level for Deschutes Co. is $12.88 per hour)
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Full Service Employment Assistance for Disabled Workers
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Vocational Rehabilitation Division
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Heather Lynch,
Roger Lemstrom
or
Linda Greaves
(541) 388-6336
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Agency is dedicated to linking employers to the historically underutilized population of disabled people in long-term employment. Offers full range of services including training, pre-screening, and placement of the disabled. From the employer standpoint, they will subsidize wages paid for a disabled worker up to 50% for a period of up to one year (terms worked out between employer, employee and VRD staff). The process is very non-bureaucratic.
Also administers the Work Opportunity Tax Credit (WOTC) which offers employers up to a 35% one-time tax credit on the first $6,000 paid in wages per employee. Tax credits are non-deferrable.
Note: disabled employees have a statistical track record of being dependable, hard-working, loyal, and have a lower turnover and absenteeism rates than the general non-disabled workforce.
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Employee Screening
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Oregon Employment Department
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Jan Swander
(541) 388-6076
Kirk Anderson
(541) 388-6455
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In addition to placing openings on a state and national electronic job board, the Employment Department can help in large or small scale screening, testing, and interviews. Again, as you know, these services can save substantial time and money for the company.
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ADA Consultation
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Vocational Rehabilitation Division
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Heather Lynch
(541) 388-6336
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Free assessment and consultation for businesses on ADA compliance that is non-regulatory in nature (they will provide suggestions to help). Service is designed to help a company meet the “reasonable accommodation” criteria equitably and efficiently. Also will do education and impact assessment of hiring and accommodating the disabled in the workplace.
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Worker Placement Program & Housing Assistance
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COCAAN (Central Oregon Community Action Agency Network)
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Roberta Miller
(541) 383-5200
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Organization focuses on housing stabilization, job placement, and training/education for economically distressed (income thresholds depend on household size) individuals & families. Offers screened applicant pool from clients.
Also offers matched savings program for clients working toward buying a first home, starting a small business, or furthering their education. Program matches every dollar ($1) saved with two ($2) from the program. Additionally, Bank of the Cascades has a program that will match each dollar saved with three ($3) dollars for first-time homebuyers. For example, an employee participating in the program saved $1,000, this could be effectively turned into $6,000 toward a first-time home purchase. Money management classes are required.
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Educational Program (Short and Long-Term)
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Central Oregon Community College
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Matt McCoy
(541) 383-7210
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Traditional classroom educational/training on a short or long term basis which is customized to meet employers needs such as personnel management, business administration, accounting, etc.
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Job Training Partnership Act (JPTA)
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Central Oregon Intergovern-mental Council
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Tom Moore
(541) 548-9523
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Offers a variety of services for under- and unemployed job seekers with computer skills, manufacturing experience, and job search counseling, with the goal to get people self-sufficient, and back in the workforce. On the Job Training Program (OJT) offers 50% of wages reimbursed to the employer during the training period (2-6 months)
Can also design customized training programs with COCC at subsidized rates.
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Welfare to Work (Jobs Plus)
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Adult & Family Services, Oregon Employment Department
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Melanie Ybarra
(541) 388-6010 x 201
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Program developed to move people from welfare to the workforce by encouraging employers to do on-the-job-training through wage subsidies. The employer defines the job, selects the worker, and training format, and the program pays up to minimum wage (currently $6.50 per hour in Oregon) of total wage for a period up to 6 months. Additionally, social security costs, unemployment insurance, and worker’s compensation costs are all reimbursed. Employers participating in the program have the freedom to hire or fire.
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Dependent Care Tax Credits for Employers
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Oregon Commission for Child Care
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800-435-4127 or
800-342-6712
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50% of amount incurred either in direct cash payments or vouchers or through contracted dependent care referral services can be taken as tax credit up to cap of $2,500 per year/employee.
If an employer chooses to develop a dependent care facility, it may take the smallest of the following: 1) 50% of the amount paid for acquisition, construction, or improvement of property to be used primarily as a dependent care facility serving employees, 2) $2,500 times the number of full-time equivalent employees, or 3)$100,000.
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Developmentally Disabled Job Training and Placement
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Opportunity Center
(Supported Employment of C. O)
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Darrel Wilson
548-2822
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Private non-profit organization dedicated to serving the developmentally disabled. Free services include job placement, pre-employment screening and assessment. Financial incentives delivered via Voc-Rehab, COIC, and Jobs Plus.
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Goodwill Vocational Services
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Goodwill Industries
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Don Sonberg
617-8946 x 2
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Program works with economically disadvantaged individuals (and those with disabilities) with free placement services, assessment, pre-screening, and job matching both for employer and job seeker.
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School to Work Programs
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Education Service Districts (ESDs), Local School District Offices, Chambers of Commerce, and High Schools
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Deschutes County Contacts:
Larry Fenili
(Bend-La Pine)
(541) 383-6032
Diane Dunbar
(Redmond)
(541) 923-4800
Marion Harrison
(Sisters)
(541) 549-4045 x443
Crook County Contact:
Chamber School Programs Division
(541) 416-6906
or
(541) 447-6304
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General: School-to-Work could be an excellent direct source for tapping into career-oriented students while in high school that will develop into productive employees long-term. Each school district administers school-to-work programs differently. Job boards exist in all area high schools.
Bend-LaPine has a separate non-profit organization contracted to conduct all school to work activities, which includes: connecting schools and businesses through career offices, mentorships, job shadows, and work-based learning. 14 different industries have been developed for which students can learn, earn credit, and gain entry-level employment as well as have individual experiences for entering the job world either on short or long-term basis
Redmond’s program is integrated through the school district (in-house) Three programs exist: 1) work experience – students find their own jobs for credit 2) internships are 60 hours long, typically written by the employer, or student/employer/school-to-work coordinator 3) one-on-one mentorships (150 annually) are the most popular for the purpose of the student gaining knowledge of a particular industry or profession.
The Sisters program also is administered through the district, and offers matching of student’s aptitudes and interests with employer labor needs. Due to a thorough process of internal screening, the program has been very successful, with a 99% success rate for students and employers participating in the program over the last 5 years (only 6 of 700 were dismissed from the program).
Established in 1994, this community’s School to Work Program has been recognized by the Oregon Department of Education and Regional Educational Laboratories as one of the most successful in rural Oregon. 25 programs are offered, and work experience and curriculum are built upon Career Related Learning Standard’s 12 skill areas deemed mutually important by educators and employers.
During the 1999-2000 school year, more than 600 high school students and approximately 103 businesses and public agencies participated in the program.
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Title V of Older Americans Act
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Central Oregon Intergovern-mental Council
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Can offer a variety of services for the under- and unemployed job seeker with computer skills, manufacturing experience, and job search counseling, with the goal to get people self-sufficient, and back in the workforce. On the Job Training Program offers 50% of wages reimbursed to the employer during the training period (2-6 months)
Can also design customized training programs with COCC at subsidized rates.
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Other Incentives
On a case by case basis, other incentives have also been offered to manufacturing companies creating new employment within the state. Incentives from the State of Oregon are typically used to fill a specific need for a particular business. In most cases, the particular company needs to make the case for why and to what magnitude an incentive is needed (i.e. why the company can’t bear these costs). Incentives can be in the form of assistance with customized worker training (discussed above) help with moving equipment or specialized equipment purchases, infrastructure extension (sewer, water, roads,) or even assistance in securing land.
The magnitude of most incentives are determined by the number of new jobs and their respective wage levels, amount of investment, and role the company will play in helping to diversify the particular community’s economy. For instance, incentives of any kind for a business of this size would be unlikely in Bend because of its lower unemployment rate, higher median wages, and relative prosperity. On the other hand, the same project could be a likely candidate in Redmond, Prineville, or Madras. Again, each award is made on an individual basis.
Programs used in the past to for these resources include:
The Governor’s Strategic Reserve Fund (SRF)
Resources from the SRF are appropriated by the state legislature to be used at the discretion of the Governor for business development projects strategic to the Oregon economy – projects that create significant employment at above average wages, or that are significant to selected targeted key industries.
Old Growth Diversification Fund
Federal funds earmarked for helping communities rebound from the economic hardship caused by changes in federal forest management (i.e. decline of the primary wood products industry) these funds have also been used on a case-by-case basis for business development projects that help diversify the Oregon economy. Priority is given to rural and economically distressed areas.
Regional Strategies/Rural Investment Funds
Oregon’s counties are partitioned into 13 regions, which have volunteer boards comprised of local leaders that make funding decisions on community and business development projects. Known in Central Oregon as the Community Investment Board, the group distributes an allocation of Lottery funds from the state for significant business development projects. |
