Intel's request for tax break wins support

Computer chip manufacturer Intel's request for tax breaks from Washington County through the state's strategic investment program (SIP) has won the support of the Northwest Oregon Labor Council (NOLC) and Columbia-Pacific Building Trades Council.

At a packed labor council meeting in Portland on Feb. 22, some 120 delegates overwhelmingly voted to support the tax break, subject to referral back to the council's Executive Board for concurrence, which it received the following day.

Intel plans to spend $12.5 billion over the next 15 years retooling and making capital improvements at its Ronler Acres facility in Hillsboro - contingent upon approval of its SIP application.

"That's hundreds, if not thousands of jobs for union construction workers," said Matt Walters, business manager of Plumbers and Fitters Local 290.

Wally Mehrens, executive secretary-treasurer of the Columbia-Pacific Building Trades Council, said since 1968 Intel has been "as good or better than any industrial customer we've ever dealt with."

Mehrens said the tax relief proposal is conditioned on the expansion actually happening. "It's not as if they're getting a $121 million tax break and then don't have to do anything. But without the tax break Intel could move the work to Arizona, Texas or New Mexico, where it has other plants."

The $121 million figure is the estimated tax savings Intel would get over 15 years, according to the Oregonian newspaper.

The strategic investment program was approved by the 1993 Oregon Legislature and revised by the 1995 Legislature. Under the program, companies can apply to the state for a property tax exemption for a project valued at more than $100 million. If the state approves an application, then the project's first $100 million in real market value goes on the tax rolls at its assessed value and will increase by 3 percent per year. Any amount over that first $100 million is exempt from taxes for up to 15 years.

As part of the SIP application process, state law provides that a board of county commissioners (with the concurrence of a city council if the project is located in a city) may "request" that the project be granted a tax exemption. Without that request the state cannot approve the exemption.

At the Feb. 22 labor council meeting some questions were raised about Intel's use of non-union subcontractors and its lack of a unionized workforce inside the facility. Intel employs about 11,000 people in Oregon.

Building trades representatives agreed that it was an issue that needs to be addressed, and that the construction trades have "common ground" with those employees and the unions that might represent them.

"We need to work together to make sure everyone out there is making a living wage," said Gene Lawhorn, a member of the Carpenters Union.

Walters reminded delegates that union construction workers make good wages and "they spend that money locally. We all know what happened in the 1970s and '80s when labor didn't support industry."

A community forum to discuss Intel's investment plans and strategic investment program proposal has been set for 7 p.m. Wednesday, March 10, in the cafeteria of the Public Services Building, 155 N. First, Hillsboro. Representatives from the county and Intel will attend to respond to questions, suggestions and concerns. The forum will be televised live by Tualatin Valley Community Access on TCI Cable Channels 9 and 33. In the meantime, labor will be writing and calling Washington County commissioners asking them to support the tax break for Intel. The commission is comprised of Tom Brian, Delna Jones, Kim Katsion, Roy Rogers and Andy Duyck.

While Intel has not yet filed a formal application under the strategic investment program, it has made the following public statements about its proposal:

* This investment is contingent upon approval of a Strategic Investment Program application.

* The focus of Intel's investment would be equipment purchases and factory improvements.

* These investments would allow the company to retain key research and development and manufacturing functions in Oregon.

* Significant new construction and job growth is not anticipated.