The Oregon Enterprise Zone program is a State of Oregon economic development tool utilized by the City of Hillsboro and other communities. The program allows for property tax exemptions for up to five years as a tool for attracting and retaining industrial companies that create jobs. When companies succeed in Hillsboro and create jobs, our community benefits as a whole by providing employment opportunities, investment, and tax revenues, all of which contribute to a higher quality of life.

A total of 25 companies have participated in the Hillsboro program, and approximately 23 projects are active as of March 2015. Since 2006, the City of Hillsboro's participation in the Enterprise Zone program has leveraged approximately $1.3 billion dollars in private investments and has created and retained more than 1,750 full-time, quality jobs. The companies creating these jobs are mostly traded-sectors companies that could invest anywhere in the world.

The Enterprise Zone program allows a 100 percent exemption of property taxes attributable to the new investment for up to a five-year period. Land or existing machinery or equipment is not tax exempt; therefore, there is no loss of current property tax levies to local taxing jurisdictions.

When the exemption period ends, the new improvements are fully taxed, and the asset enters the tax rolls. The short-term waiver of local taxes results in a long-term return to the local taxing jurisdictions. The Enterprise Zone program is our City’s best economic development tool for attracting industrial-sector businesses to establish and grow in Hillsboro.

Why does the City of Hillsboro participate in the State of Oregon’s Enterprise Zone program?
As a job creation tool and stimulus to new investment, the State of Oregon’s Enterprise Zone program allows Hillsboro to help existing businesses to expand operations and increase employment, and to recruit companies that can create additional jobs in our community.

In addition to the private investment and job creation requirements, the public benefits derived from the E-Zone program include:

• increased business opportunities for local companies through a local procurement program
• an enhanced tax base to the benefit of all taxing jurisdictions
• payment of 25 percent of the value of the tax abatement in the last two years of exemption into the workforce training fund to support local job training and skills enhancement.

 The City of Hillsboro requires companies that participate in the program to pay competitive wages and benefits, offer training programs, and promotes the purchase of local goods and services. For companies participating in the program for five years, the City requires a Community Service Fee that funds workforce training and student support programs.

As employment increases in Hillsboro the entire community benefits, and when the Enterprise Zone tax abatement period ends, the companies and projects are taxed at the current tax rate, contributing tax revenues that fund City services such as police and fire protection, parks, libraries and education.

What are the direct benefits to Hillsboro residents?
The Enterprise Zone program is primarily intended to assist in job creation and help companies to succeed and expand in Hillsboro. Community Service Fee funding from the companies that participate in the Enterprise Zone program pays for workforce training programs that increase skill levels and job opportunities for Hillsboro residents. In addition, many students attending Hillsboro high schools also benefit scholarships and academic support through Portland Community College’s Future Connect program. The City of Hillsboro has contributed $300,000 toward the PCC Future Connect program because of funding from Enterprise Zone companies that pay a Community Service Fee.

Do low-income households benefits as well?
Yes! Enterprise Zone companies are creating jobs and funding training opportunities that will help workers from all backgrounds with unique education and skills development. In addition, the jobs and wages created by Enterprise Zone companies help to support local businesses such as grocery stores, restaurants, retail stores, and more. By providing these companies with additional local customers, Enterprise Zone companies indirectly support the creation of additional service-sector jobs.

The Enterprise Zone program also funded the City of Hillsboro’s $300,000 contribution for partial scholarships and support to 150 students from Hillsboro high schools participating in the Portland Community College Future Connect program. Of the two groups of Hillsboro students who have participated in the program to date, 68 percent of the first group of students and 38 percent of the second group of students resided in areas in or adjacent to Hillsboro’s Enterprise Zone.

The Enterprise Zone Community Service Fee has also provided funding to local high school students through the Hillsboro Rotary/Leonard Gratteri Memorial college scholarships, and the Stand for Children/Jeannette Hamby college scholarships.

The Enterprise Zone Community Service Fee is also supporting workforce training programs for Hillsboro residents. English for Speakers of Other Languages (ESOL) training is occurring to upgrade the skills of existing workers. On-the-job training (OJT) and Certified Production Training (CPT) programs are also getting underway.

How many jobs have been created by companies participating in the Enterprise Zone program?
As of March 1, 2015, companies located in Hillsboro’s Enterprise Zone have created approximately 1,750 jobs.

What would happen if the City of Hillsboro stopped participating in the Enterprise Zone program?
The City’s efforts to create additional jobs would be restricted without this economic development tool. In addition, the funding source for various workforce training programs and for the support of the PCC Future Connect program would be eliminated.

The City of Hillsboro has three areas in the Enterprise Zone. What are the differences?
The North Hillsboro area has a higher minimum investment participation requirement for companies: $1 million. In the Southwest and Downtown Hillsboro areas, the minimum investment participation requirement is $250,000.

Participation in the program has been greater in North Hillsboro to date because of the available land and infrastructure in place that businesses find desirable. That increased interest in North Hillsboro is a reflection of market demand. City of Hillsboro staff continue to encourage businesses to take advantage of the lower investment requirement in Southwest and Downtown Hillsboro.

Several companies participating in the Enterprise Zone program are data centers. What benefits do data centers bring to Hillsboro?
Data centers in Hillsboro do more than create direct jobs. As internet use and cloud computing is becoming a necessity in our society, the need for data centers to store critical and confidential information has increased. The investments made by data centers create local construction jobs, permanent jobs and, indirectly, supplier jobs. Three of the top five companies driving the server market are located in Oregon (HP, Oracle, and IBM), and IBM and Oracle are located in Hillsboro, as well as many server manufacturers that use Intel processors. Their collective presence enhances the digital infrastructure that contributes to Hillsboro’s enviable position as a center of global technology. Additionally, data centers help the City of Hillsboro increase revenues through franchise fees assessed to utilities such as electricity and telecommunication providers. The increased revenues help to pay for local police and fire protection, libraries, parks, and much more.