Business Oregon Commission Meeting

Unanticipated agenda items may or may not be included. The meeting location is accessible to persons with disabilities. A request for an interpreter for the hearing impaired or for other

accommodations should be made at least 48 hours before the meeting to: Suzy Miller at (503) 986–0117.

May 22, 2020 10:00 am – 12:30 pm

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AGENDA

Time Item Presenter

10:00 am–10:15 am Welcome and Introductions

10:15 am-11:00 am Director’s Report • Summary of COVID-19 Response

(reference "2020 Business Oregon’s COVID Response and COOP Notes" in packet)

• Governor’s Reopen Plans• Internal Audit Charter• iLearn Training Reminder

11:00 am–11:30 am Strategic Investment Zone • Consider Eligibility of Columbia Distributing

project in Clackamas County/City of Canby• ACTION: Eligibility Vote

11:30 am–12:00 pm Upcoming Legislative Session • Policy Option Packages/Legislative Concepts

for 2021-2023 Budget

12:00 pm–12:15 pm Public Comments

12:15 pm–12:30 pm Adjourn

Chair Gopalpur

Chris Cummings Brenda Bateman

Leah Horner Brooks Peacock Brenda Bateman

Arthur Fish

Nick Batz

Chair Gopalpur

Chair Gopalpur • Next Meeting: July 17, 2020 / Teleconf• Potential Agenda items

O r e g o n B u s i n e s s D e v e l o p m e n t C o m m i s s i o n D R A F T

December 13, 2019 Portland, OR

Attendance Members Present: Kanth Gopalpur, Commission Chair; Representative Janelle Bynum, District 51, Clackamas; Jessica Gomez, Rogue Valley Microdevices, Inc.; Paula Hayes, Hue Noir; Thomas Insko, Eastern Oregon University; Senator Betsy Johnson, District 16, Scappoose; Katherine Lam, Bambuza; Keith Leavitt, Port of Portland; and Kelley Minty Morris, Klamath County Board of Commissioners Members Absent: None Staff Present: Chris Harder, Director; Robert Ault, Business & Community Development Manager; Brenda Bateman, Assistant Director – Operations & Finance; Nick Batz, Government Affairs Manager; Nathan Buehler, Communications Manager; Bryant Campbell, Diversity, Equity & Inclusion Manager; Chris Cummings, Assistant Director – Economic Development; Bryan Guiney, Regional Development Officer; Art Fish, Incentive Coordinator; Cara Kaser, Chief Information Officer; and Gina Wiedrick, Executive Assistant Guests: Ann Crumrine, Lake County Treasurer (via telephone); Shari Dunn, Dress for Success Oregon; Leah Horner, Office of the Governor; Dave Knowles, Lake County Assessor’s Office (via telephone); Michelle Slater, Obsidian Renewables; and Brad Winters, Lake County Commissioner (via telephone) Meeting was called to order at 10:08 a.m. Welcome/Introductions Chair Gopalpur welcomed attendees to the meeting of the Business Oregon Commission and everyone in the room introduced themselves. Approve Meeting Minutes Action: Chair Gopalpur called for a motion to approve the minutes from the September 20, 2019, meeting; Commissioner Insko moved and Commissioner Morris seconded the motion. Vote: minutes approved. Dress for Success Mr. Guiney introduced Ms. Dunn and gave a brief overview of the history of Dress for Success. Ms. Dunn gave an overview of Dress for Success Oregon, the work they do, and the partners they work with. For more information, go to https://oregon.dressforsuccess.org/.

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Oregon Business Development Commission Meeting, December 13, 2019, Portland Page 2 of 5

Questions asked: • How is Dress for Success Oregon funded? Ms. Dunn responded that when she first started

working there, funding was a combination of grant funding, events, earned income, and individual gifts. Now, for the past three years, there is also funding through a contract with the state of Oregon for career and training support for those in the Supplemental Nutrition Assistance Program.

• Some of the obstacles are emotionally based; how do you break from that and move forward? Ms. Dunn responded that they use the relational model of support; hearing from others who tell their story and how they are personally moving forward.

At approximately 10:33 a.m., everyone left the room for a tour; at approximately 11:02 a.m., everyone returned to the room to proceed with the meeting. Director’s Report Director Harder gave an overview of the recent Asia Trade Mission to South Korea and Japan. Commissioner Leavitt added that the SM Line Corporation will start using Terminal 6 in Portland and the first ship will arrive in January 2020; this will be particularly helpful for the rural communities to get their agricultural products overseas. The Port of Portland also made strides on getting a non-stop flight to South Korean; did not get it yet, but did make headway. Director Harder responded to a question asking how companies are selected for trips, such as the Asia Trade Mission, saying that there is a focus on foreign direct investment, each trip is thematic, and it varies depending on the regions that are in the itinerary. This trip was focused on athletic and outdoor, and wine. Participating companies make use of the State Trade Expansion Program and receive a grant to offset trip costs, and have reporting requirements to show the success of the trip in terms of contracts and sales. Ms. Horner introduced herself and gave an update on the director search; the Governor’s Office is working closely with the Department of Administrative Services on the recruitment. The position was posted online on November 25, there are 26 applicants so far, expecting about 26 more, but still need to look to see if they meet the minimum requirements. The posting will remain open for four weeks, look at applications on December 20, and determine if the posting should remain open longer or not. Staff is still thinking on what the interview process will look like, and what participation Business Oregon staff and commission will have. It is likely that we will not make the February legislature appointment confirmations; therefore, this will take place in May. Chris Cummings will be the interim director. Ms. Horner presented Director Harder with a certificate signed by Governor Brown, and an Oregon-shaped wood cutting board. Director Harder stated that he does not want the commissioners to worry about the transition; he is fully confident in the direction that the agency is going, he has confidence in its leadership, and Chris Cummings will be great. Mr. Buehler gave an overview of the annual report, and Director Harder spoke on the metrics. Representative Bynum stated that she would like for Business Oregon to raise its profile, attempt to get rid of the activities that are not related to its work (just because Business Oregon does a good job, it does not mean that it should be doing the work) – and it is something that she will continue to push for – and continue to do things that show that Oregon is business friendly.

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Oregon Business Development Commission Meeting, December 13, 2019, Portland Page 3 of 5

Break At approximately 11:53 a.m., Chair Gopalpur called for a break. At approximately 12:04 p.m., Chair Gopalpur reconvened the commission meeting. Senator Johnson joined the meeting at approximately 12:16 p.m. Agency Diversity, Equity, and Inclusion Strategies Mr. Campbell gave an overview of the historical path in the agency’s work in diversity, equity, and inclusion (DEI); including the forming of the DEI Council, identifying trainings, creating a plan, and accomplishments so far internally and externally; and next steps. Question and comment:

• Is Business Oregon conducting regular surveys of staff? Ms. Bateman responded that a contract was just signed with a company that will help management explore survey options, make a plan on further surveys to assess progress; the next survey is rolling out in spring 2020.

• A lot of the DEI work looks to be internally focused; would like to see more focus on external work. How many businesses are being helped? How many jobs are being created and retained? Would like to see a report with true data on the diversity of these businesses and their workforce.

Information Technology Strategic Plan Ms. Bateman gave an introduction, and Ms. Kaser gave an overview of the IT Strategic Plan 2019-2024 with a focus on recommendations, what can be implemented now, and what could be implemented with additional resources. Legislative Process Mr. Batz gave an overview of the upcoming short session; Business Oregon does not have any agency bills, but there are three bills that impact the agency:

• Universal Service Fund (provides funding to the Broadband Office) • Prevailing Wage/Enterprise Zone bill from Senator Kathleen Taylor • Access to Capital bill from House Economic Development

o New loan-loss-reserve program for underserved/underrepresented o Study on capital needs for underserved/underrepresented o Capital for underserved/underrepresented business owners

Ms. Horner stated that the governor is able to submit five bill in the short session, and her priorities are carbon, resiliency efforts, removal of the sunset on transient lodging tax, something around housing, and Wildfire Council recommendations. Mr. Batz went on to provide a timeline of the Legislative Concepts (LCs) and Policy Option Package (POP). Two years ago, we began the process in January, but this year, the Management Leadership Team began the process in July. There are 30 POPs and LCs being worked on. Next steps is for Mr. Batz to engage heavily with staff and management, prioritizing by the Executive Team, presentation to the commissioners in April, LCs submittal deadline is April 17, and POPs

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Oregon Business Development Commission Meeting, December 13, 2019, Portland Page 4 of 5

submittal deadline is in July. The task for commissioners is to think about how you might be able to engage in this process; connect with Mr. Batz Strategic Investment Program (SIP) Project Approval Mr. Fish gave an overview of what this SIP is for and what the Commission is being asked to approve. Chair Gopalpur asked that the county and the company make statements. Mr. Knowles stated that this project is beneficial to the county and they are all united in the desire to see this move forward. Ms. Slater stated that this is one of the largest projects that they are attempting, there is still much that needs to be done, but they have a good relationship with Lake County and have received a lot of support. She added that they would love to be able to move it forward through the Oregon Department of Energy (ODOE) permitting process and into construction; they will employ many locals. Senator Johnson asked about their experience with working with the regulatory agencies. Ms. Slater responded that there have been barriers, it is time consuming, and there are many fees. Working with ODOE has been slow but they have tried to be helpful. Senator Johnson wanted to flag the oversight fees and feels that companies should be able to ask agencies for a written statement of work, a calendar, and set fees that do not escalate; this is critical to enticing companies to come to Oregon. Public Comment No public comment was presented. Action: Chair Gopalpur called for a motion to approve Resolution SIP-19-02. Commissioner Insko moved and Commissioner Morris seconded the motion. Vote: SIP-19-02 approved. Closing Remarks and Adjourn Chair Gopalpur stated that this is Director Harder’s last meeting, and he thanked him for his leadership and stability for the agency and keeping the commission informed. Director Harder gave his thanks and appreciation at working with this group; they bring different perspectives and are thoughtful in their focus. Chair Gopalpur stated that this is possibly also Commissioner Lam’s last commission meeting, and thanked her for her service. Meeting invites for 2020 will be sent out in the coming month, with the next meeting being held on April 10. Meeting adjourned at 1:44 p.m.

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Oregon Business Development Commission Meeting, December 13, 2019, Portland Page 5 of 5

Approved by:

____________________________________________________________________________________ _________________________

Kanth Gopalpur, Chair Date Oregon Business Development Commission

____________________________________________________________________________________ _________________________

Chris Harder, Director Date Business Oregon

Commission MeetingMay 2020

Portland, Oregon

Kanth gopalpur

welcome

Today’s Agenda10:00 Welcome, Approve Minutes10:15 Director’s Report

- Summary of COVID-19 Response- Governor’s Reopen Plans- Internal Audit Charter- iLearn Training Reminder

11:00 Strategic Investment Zone- Consider Eligibility of Columbia Distributing

project in Clackamas County/City of Canby- ACTION: Eligibility Vote

11:30 Upcoming Legislative Session- Policy Option Packages/Legislative Concepts for 2021- 2023 Budget

12:00 Public Comment and Adjourn

Chris cummings

Director’s report

COVID-19 Timeline: January 2020 to Present

• Living document, noting changes or new programs to respond to COVID.

• Meant to inform our Continuity of Operations Plan (COOP).

• Staff are mentioned by name. Note breadth and depth of the team response.

• Evolved from an operations document to a programs document.

Governor’s Reopen Plans

• County-specific approach

• Phases 1, 2, and 3

• Guidelines

Internal Audit & Consulting (IAC) Charter

• Approved and adopted by the Audit Committee on April 27, 2020• IAC Function is now an in-house function

– Compliance with ORS 184.360 and OAR 125-700-0155 through 125-700-0155– Secretary of State Audit 2018

• IAC Function Purpose & Objective– Independent, objective assurance and consulting engagements– Add Value & improve agency operations– Systematic, disciplined approach to evaluate & improve agency’s governance, risk management, &

controls

• Institute of Internal Auditor’s (IIA) Professional Standards– International Professional Practices Framework (IPPF)– Commonly known as Red Book Standards

iLearn Training

• Required training for all staff AND Board/Commission members

• Three segments:–Overview of Ethics Law

–Information Security

–Preventing Discrimination and Harassment

• Available online at https://ilearn.oregon.gov/

Art fish

Strategic Investment Zone

Columbia Distributing project in Clackamas County/City of Canby

• Introduction from Art Fish

• Presentation from Columbia Distributing

• Q&A with company and local officials

• Public Comment

• ACTION: Eligibility Vote

Business Oregon Commission Meeting

May 22, 2020

Branch locations

About canby warehouse

• Future workplace of 300+ employees

• Consolidates 3 Portland warehouses• 530,000 sq. ft.

• Proud to offer outstanding benefits and living wages for our employees

For a full list of our brands, check out www.Coldist.com

Domestic Beer

Craft Beer

Import Beer Cider

Wine

Spirits

FMB

For a full list of our brands, check out www.Coldist.com

Non-Alcoholic

Columbia Distributing project in Clackamas County/City of Canby

• Q&A with company and local officials

• Public Comment

• ACTION: Eligibility Vote

Nick batz

2021 Legislative Session

2021 Session LC/POP Key DatesLC: Legislative Concept POP: Policy Option Package

• August 2019 Began internal discussions on POPs & LCs

• April 17, 2020Submit LCs to Department of Administrative Services

• May 15, 2020Submit lottery bond request form

• June 2020LC/POP briefing with individual commissioners

• July 2020Present agency request budget including, reduction scenarios and POPs to Commission

• August 2020Agency finalizes budget and submits to Governor’s office

2021 Session Agency Priorities

Themes guided by our Strategic Plan:

• Innovation

•Rural Economic Stability

•Agency Efficiency

2021 Draft Legislative Concepts

• LC-001 – Innovation Tax Credit

• LC-002 – Percent for Art Statute Adjustment

• LC-003 – Film & Video Office Incentive Program Sunset Extensions

• LC-004 – Oregon Business Development Fund (OBDF) lending limit increase

• LC-005 – Entrepreneurial Development Loan Fund (EDLF) Lending Limit Increase

2021 Draft Policy Option Packages • Innovation

– Oregon InC

– Percent for Arts

• Rural economic stability

– SPWF recapitalization

– Rural Opportunity Initiative

– Global trade expansion

– Brownfield Revolving Loan Fund recapitalization

– Seismic recapitalization

– Regional Solutions

• Agency efficiency

– Business Oregon technology modernization

– Budget Technical Adjustments

Public

Public Comment

Adjourn / Final Items

• Next meeting: July 17, 2020 / Teleconference

• Potential agenda items?

2020 Business Oregon’s COVID Response and COOP Notes

1/31/20

• First call with Oregon Office of Emergency Management (OEM); briefing on COVID-19 in China

2/28/20

• First positive test of COVID-19 in Oregon.

3/02/20

• Chris C. sent 1st note to all staff announcing presumptive cases in Oregon. • Jason and Stephen reported in to Emergency Coordination Center (ECC). • Jim ordered additional supplies of water for Salem and PDX in case we are ordered to shelter in place. • Brenda Fleming places an order for more hand sanitizer!

3/03/20

• Chris C. asks all managers to report on travel plans for the next month. • Dana sends FAQs to all managers with information about use of leave, telework, and building closure.

3/06/20

The Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020 (P.L. 116-123), which passed with near unanimous support in both the House and Senate, was signed into law by the President on March 6, 2020. The bill provides $8.3 billion in emergency funding for federal agencies to respond to the coronavirus outbreak. Of the $8.3 billion, $6.7 billion (81%) is designated for the domestic response and $1.6 billion (19%) for the international response.

3/07/20

• Governor declares a state of emergency.

3/11/20

• Pam is capturing all incoming COVID-related questions from businesses. Send her a copy of Q&A. • Governor bans all large gatherings of more than 250 people.

3/12/20

• Governor closes all public schools from March 16 through March 31. • Nathan posted FAQs for staff on the intranet, regarding virtual meetings and remote work. • Jim will purchase additional conference lines & make them available to Suzy, David S., Bonnie, Pam, Kat. • Chris C. & Chair Kanth Gopalpur cancel Spring Pop-Up and move April 10 Commission meeting to PDX.

3/13/20

• President declares COVID-19 a pandemic and declares state of emergency for the nation. • John S. sent resources from the Small Business Administration (SBA) out to businesses. • Nathan created fillable forms for Telework Agreements and posted to the intranet. • Jessica & Steven ordered 10 more laptops, and got more staff remote-capable. • Dana sent note to all staff, regarding potential work at home and pay scenarios. • Cara sent note to all staff, regarding migration of state email system to more secure platform. • Chris C. sent note to all staff, with COVID-related agency updates. • Chris C. and Brenda call in to the first of a series of DAS briefings for all agency directors.

3/14/20

• Nathan posted a COVID Tweetstorm to agency Twitter account, to direct customers to resources.

3/16/20

• Governor bans events with more than 25 people; bans in-store dining at restaurants & bars. • Chris C. activated Business Oregon’s Continuity of Operations Plan (COOP). • We informed ECC, DAS, Governor’s Policy Advisor, State Resiliency Officer of COOP activation. • Ed responded to State Resiliency Officer regarding agency’s ability to close or work remotely. • IT created a One Drive folder for the Emergency Response Team. • Chris Cummings created and convened an Emergency Response Team (see org chart on One Drive). • Mindee developed a phone list of Manager – only cell phone numbers (see One Drive). • Christina instructed staff to add “COVID” to related invoices so that we can track them. • Jessica will activate “hot spots” on all agency issued iPhones. • Chris Wilhelm tested the agency capacity for remote work. 7 pm all agency Skype session. • Leah Horner, our Policy Advisor, holds organizational meeting of Coronavirus Economic Advisory Council

3/17/20

• Governor closes all Oregon schools through April 28. • Nathan posted a sign on PDX Office door – closed to the public, please call main number.

(WTC front desk will accept our mail if our front doors out locked; state shuttle service now runs T, Th). (State Lands accepts our mail first in Salem).

• Fiscal set up bizfiscal@oregon.gov. Send all payment requests here, to ensure someone sees it. • Dana will launch “morning check in” so that we take virtual roll call every morning. • Colin L. and Nick W. are designing a webpage to collect info from folks looking for COVID help. • Dana sends a note to all staff re Cascade Center’s Employee Assistance Program. • John S. sends notes to Governor and Federal Reserve Bank of SF re economic impacts so far. • State submitted request for SBA disaster assistance for businesses; waiting to hear.

3/18/20

• On March 18, 2020, the Families First Coronavirus Response Act was signed into law, marking the second major legislative initiative to address COVID-19. Key provisions of the Families First Act address the domestic outbreak, including paid sick leave, insurance coverage of coronavirus testing, nutrition assistance, and unemployment benefits.

• Jim, Steve, Nathan & Brenda settled Governor’s personal staff into PDX, and sent our PDX staff home to telecommute.

• Jenny set up accounting code for Governor’s office, to include badges, parking, HVAC, lighting, rent, and extra cleaning.

• Dana set up “daily check in” for managers to account for their staff. • Katie sent out a note to use TCM to code telecommuting on time sheets. • Dana re-directed USPS mail and inter-agency shuttle from PDX to Salem. Nathan will check mail 1x/wk. • All IT requests go to “help.help”

3/19/20

• Chris C. hosts first weekly all staff meeting via Skype • Cara migrated ERT files to Team site. • Dana developed list of essential staff. Will broadcast it to the agency. • Nick & programs teams putting together portal, email, and triage team to serve constituents. • Nathan recruited a web subcommittee under Comms / ERT.

3/20/20

• State receives SBA designation • Jim changes faxes from analog to digital • Cara issues “last call” for IT orders of laptops and cell phones • Nathan issues “last call” for PDX staff to remove personal belongings or equipment from the ofc. • Dana notifies essential employees; may appeal until 8 am Tuesday, 3/24/20 • Bryant launches employee connections group under ERT

3/21/20

• Brian convenes emergency meeting of the Cultural Trust Board to look into re-directing funds. • Cultural Trust votes to open up $10M from principal.

3/22/20

• Jenny send list available program funding to LFO and Governor ($ not yet contracted)

3/23/20

• Governor closes businesses that cannot maintain adequate social distancing. • Jonathan Moll at DSL closes Salem Office to the public. • Carrie et al ID potential suppliers of hand sanitizers, N95 masks, surgical masks and gowns

3/24/20

• Biz.COVID19@oregon.gov is now available for businesses to send their questions.

3/25/20

• ETS migrates Business Oregon emails to new server.

3/26/20

• President declares Oregon Federal Disaster Area, retroactive to Jan. 20, 2020 • Chris C. hosts second weekly all staff via GoToMeeting. • Oregon Growth Board votes to: 1) make $700K available for CDFI stabilization, and 2) prioritize small

businesses. • Business Oregon offers loan modifications to borrowers and CDFIs

3/27/20

President Trump signed into law a $2 trillion emergency bill, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). This is the largest relief package Congress has ever passed, sending a $1,200 check to many Americans, creating a $377 billion loan program for small businesses and establishing a $500 billion lending fund for businesses. Additionally, the bill provides $150 billion in new, direct aid to states, territories, tribal and local governments by formula and based on population, to be distributed no later than 30 days after the date of enactment. Funds may be used for necessary expenditures due to COVID-19; expenditures that were not accounted for in the most recently approved budget; and were incurred during the period of March 1, 2020 through December 30, 2020.

• Jim puts into place schedule for driving fleet cars, so they stay operational. • Employee Connections Committee begins contacting each employee to see how they’re doing.

3/28/20

• Governor’s Office requests Business Oregon assistance procuring lab-certified N95 and surgical masks.

3/30/20

• Chris C. signs a “declaration of emergency and hardship” so that OBDF and EDLF can modify loans. • John Saris & team begin modifying terms of OBDF and EDLF loans – no payment or interest for 90 days. • Melisa, Carrie, Amanda & teams complete initial phone calls to potential PPE vendors • Special Meeting of Oregon Inc., to discuss flexibility of funds.

4/01/20

• Governor issues EO 20-13, forbidding property owners from evicting residential or commercial tenants. • Families First Coronavirus Response Act went into effect, providing 80 hours of emergency sick leave. • Amanda Welker takes over PPE supply chain initiative. • Melisa Drugge stands up Small Business Resources Navigator hotline, with • Brian Plinski writing fact sheets, David Sell assigning shifts, and 30 staff volunteering to take calls. • Nathan, Carmen, Mary stand up Small Business Resources Navigator webpage. • Business Oregon, Travel Oregon, and SBDC network launch Small Business Survey of “economic impacts”

to businesses.

4/02/20

The U.S. Small Business Administration (SBA) issued an interim final rule for the Paycheck Protection Program (PPP), launched as part of the CARES legislation. PPP offers $349 billion in forgivable loans that small businesses affected by the coronavirus pandemic can use to cover costs including payroll and rent.

• Chris C. hosts third weekly all staff meeting via GoToMeeting. Many sign on wearing silly hats. • ETS migrates Business Oregon to Multi-Factor Authentication (MFA) • Governor’s Office issues press release announcing Small Business Navigator.

4/03/20

• >800 businesses & volunteers have offered to provide goods / services through our online database. • Small businesses and sole proprietorships with employees began applying for SBA’s PPP loans. • Small Business Resources Navigator hotline begins a soft launch, sending callers to voicemail / email. • Dana sends out all staff email explaining E-FMLA (Extended Family Medical Leave Act), an outgrowth of

the Families First Act.

4/06/20

• Governor issues EO 20-14 and 20-15, extending “until further notice” previous EOs re on-site consumption of food and beverage, and abnormal disruption of the market due to COVID-19.

• Wells Fargo announces it has reached its lending cap and cannot service additional PPP loans. • Business Finance begins to look into financial assistance for rural hospitals who have lost revenue from

cancelled elective surgeries. Estimated loss of revenue is tens of millions of dollars.

4/07/20

• The National Endowment for the Arts notifies the Oregon Arts Commission that Oregon will receive $452K for arts organizations as part of the CARES legislation.

4/09/20

• Chris C. hosts the fourthly weekly staff meeting via GoToMeeting. Staff bring their favorite mugs. • IFA Board approves the use of CDBG monies for COVID-19 related purposes, such as PPE, meals on wheels,

business grants and more. A public comment period will take place, followed by disbursements.

4/13/20

• Governors Brown, Inslee, and Newsom announce a west coast pact to coordinate opening economies. • Business Oregon begins drafting an economic recovery plan. • Melisa announces that DAS has placed orders for millions of N95 and surgical masks for Oregon. • Paycheck Protection Program loans (PPP loans) are still available through the federal Small Business

Administration. As of Monday, almost 10,000 loans had been approved for Oregon businesses, totaling $2.4 billion dollars. (The program subsequently runs out of money on 4/15).

4/15/20

• Small Business Survey (English version) closes, with 5,500 responses that describe the economic impacts and financial needs of Oregon business. The Spanish language version closes on the 20th.

4/16/20

• Chris C. hosts the fifth weekly staff meeting. Staff bring pictures of their younger selves. • Ed Tabor works with the League of Oregon Cities, Association of Oregon Counties, Special Districts

Association and others to design a survey that gauges community / infrastructure needs. • Oregon Inc. takes three actions: 1) hold any HIOP recommendations / funding decisions until after the

May revenue forecast, 2) open the SBIR match grant program to federal grants focused on COVID-19 response but are not specifically SBIR, 3) fund the Enhanced Phase 0 program with $500,000 for innovation-based companies with preference for those that are focusing on COVID-19 response or companies that are Oregon InC portfolio companies.

4/21/20

• Department of Administrative Services begins conversations with General Fund agencies about creating a plan to cut 17 percent of remaining General Fund budget for the biennium.

4/23/20

• Chris C. hosts the sixth weekly staff meeting. Bring your kids to work day AND Earth Day! • Oregon Legislature’s Emergency Board convenes virtual meeting to discuss, among other things, COVID-

19 Emergency Business Assistance and Critical Access Hospital Stabilization Loans.

4/30/20

Chris C. hosts the seventh weekly staff meeting, featuring Mike Meyers’ analysis of the Business Survey conducted with Travel Oregon and the SBDC Network. Chris briefs staff on proposed budget cuts in General Fund (17 percent cuts in arts & culture grants and solar energy incentives) and Lottery Fund (losses of $15.9M for our agency). The agency does not propose lay-offs or furloughs.

5/06/20

• I&E launches a new “enhanced innovation grant,” making $250K in Other Funds available to companies as $50K grants. The funds can go towards innovative responses to COVID or to already existing grantees for continued commercialization efforts.

• U.S. Housing & Urban Development (HUD) confirms that money released to CDBG through the federal CARES Act can be used for housing rental assistance. We will work with Oregon Housing & Community Services (OHCS) on the distribution of these funds.

• The IT team rolls out training on Microsoft Teams to sections who are interested in learning more about the video conferencing and chat functions. Over the past 30 days, we’ve held 847 meetings using Teams (that’s an average of 28 per day!), sent 2,561 chat messages, and have made 128 Teams calls.

5/07/20

• Chris C. hosts eighth weekly staff meeting, featuring Public Employee Recognition Week, with kudos and a video compiled by Mary Norton.

5/08/20

• Business Oregon sends out an RFP, inviting public entities to apply for grant monies under the Small Business Assistance program that was launched by the Emergency Board when it met in April. $2.5M is available to go to municipalities and other public bodies who can provide a “cost match,” and who can demonstrate partnership / outreach to under-represented businesses. Expect additional rounds of funding to go specifically to CDFIs and other partners, for a total of $5M. First round of RFPs due May 18. Staff lead: John Saris.

• Business Oregon sends survey to Oregon communities to gauge their COVID-related funding needs. Developed in partnership with the Association of Oregon Counties (AOC), League of Oregon Cities (LOC) and Special Districts Association of Oregon (SDAO), this survey is trying to gather information about the impacts that COVID has had on the operations and infrastructure of cities, counties, and districts. Survey is due May 22. Staff lead: Ed Tabor.

5/11/20

• Business Oregon hosts a webinar for 150+ prospective applicants for the $2.5M Business Assistance cost match grant. Nathan hosts; John S. and Melisa D. present.

5/12/20

• Governor sends all executive branch employees updates about reductions in the General Fund budget.

5/13/20

• All executive branch agencies post proposed list of General Fund budget cuts to their websites. • DAS sends out new guidance regarding COVID-related leave payroll codes.

5/14/20

• Chris C. hosts ninth weekly staff meeting. Participants stay on-line afterwards to visit. • Governor announces re-opening of 31 Oregon counties and six industry sectors (restaurants, retail,

personal services, child care, transit, and outdoor recreation). Governor points to our Small Business Navigator website for help with PPE and hand sanitizer.

• Jason and Carrie meet with Oregon Office of Emergency Management regarding State Recovery Function (transition away from Emergency Functions).

5/15/20

• Legislature’s Emergency Board convenes to discuss distribution of CARES Act funding in Oregon.

5/18/20

• The Employee Connections Team activates a chat feature on Microsoft Teams, providing an informal way for staff to share news about our daily lives, graduations, etc. Thanks to Brooks P. for the idea.

5/22/20

• Chris C. hosts tenth weekly staff meeting. • First virtual meeting of the Oregon Business Development Commission. • House Economic and Community Development Committee meets to assess business’ access to COVID

funds.

C o m m i s s i o n A g e n d a I t e m C o v e r S h e e t 05/15/2020

TO: Chair Gopalpur and members of the Oregon Business Development Commission (OBDC)

FROM: Art Fish, Business Incentives Coordinator

SUBJ: Determination of Strategic Investment Program (SIP) Eligibility for Columbia Distributing Warehouse

Background On July 2, 2019, Coho Distributing, LLC, dba [doing business as] Columbia Distributing applied to Business Oregon for the Commission’s approval to receive the 15-year period of SIP tax treatment on its proposed, 530,000-square-foot distribution center in Canby. This is the first application for SIP based on the project’s being inside a strategic investment zone (SIZ), specifically Clackamas Rural SIZ #1. SIZs are explained further in this memo. Location in a designated SIZ is an alternative to project-specific approval by a county government, but for the same SIP tax treatment—a multilayered partial exemption from local property taxes. SIP is currently used by several major investments across northern Oregon. In the resources box online at Business Oregon | Strategic Investment Program are summary tables of all recent projects in the program, including a new one based on 2020 payroll reports from businesses. Oregon Law for SIP prescribes:

• A 15-year period, beginning with the tax year once sufficient property is placed in service. • Exemption on the real market value of project property in excess of a taxable portion, which

grows 3% per year, from one of the following starting points— Total investment costs Taxable portion of RMV

$0.5 billion or less & rural $25 million $0.5–1.0 billion & rural $50 million

Urban, or >$1.0 billion & rural $100 million.

• Community service fee—equal to the lesser of $500,000 (in the case of a rural SIZ project) or 25% of each year’s property tax savings.

• That the requisite local-government agreement may contain additional conditions on the business firm, which have tended to involve other local payments.

• No employment criteria, although state statutes do— o Require a first-source hiring agreement by the business with publicly funded job

training providers, like with businesses benefitting from lottery funds or a 3–5-year property tax abatement in an enterprise zone.

o Exhort the employer to hire from within the surrounding region.

Re: SIP Determination for Columbia Distributing – 05/15/2020

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Program Criteria and Tax Impacts To receive the benefit of property tax assessment under SIP, a determination is required from the Commission upon finding that the project is eligible under the law. With an SIZ, there is not necessarily a public hearing or governing body vote to specifically approve the project. Nevertheless, in March and April, the Canby City Council and Clackamas County Commission did vote to authorize the local agreement with Coho Distributing, using the standardized format and criteria established with Clackamas Rural SIZ #1 back in 2010. Also as required by law: (1) the proposed project and business are in a traded-sector industry, in that Columbia Distributing wholesales a product – containerized beverages, and (2) the investment will exceed the $25-million minimum for a rural project. Excluding land, off-sites and transactional costs, I have estimated the local property tax revenue from the project to be around $5.0 million (taxable portion) over 15 years. In addition, about $5.5 million in taxes are abated due to SIP. The net benefit for Columbia Distributing would approximate $4.1 million, after deducting mandatory community service fee payments totaling nearly $1.4 million. The county, city and special service districts would share these payments under a separate agreement among themselves. Project and Company According to the submitted application as completed with the local agreement:

• The $68-million project is still being constructed and will be operating later this year. • In addition to obligatory contract elements, the standardized agreement for Clackamas

Rural SIZ #1 requires that Columbia Distributing will enter into a First Source Contracting Agreement to specifically further its using vendors or suppliers in the local community.

• The new warehouse and distribution center will employ around 300 persons, which represent retained jobs in the sense of employment relocating from facilities in Portland, as Columbia Distributing consolidates operations that will serve much of Oregon.

Coho Distribution, LLC, dba Columbia Distributing has not previously used SIP. Based in Oregon, Columbia Distributing has been in business since 1935. In 2008, it merged with Mt. Hood Beverage. Today, its more than 3,100 employees service over 22,000 customers across Oregon, Washington and California. Strategic Investment Zones Allowed by 2005 laws, SIZs were a response to experience with protracted SIP negotiations in Multnomah County during the 1990s. The idea is that cities and counties could agree ahead of time to certain procedures and additional conditions to impose on businesses for SIP within a certain geographic area. This would not only streamline local processes, but it would also engender predictability and enhance marketing to businesses. In 2008–2010, several cities and two counties held public hearings, entered into intergovern-mental agreements, and submitted plans and documentation to Business Oregon for three SIZs. Two are in Clackamas County, both designated by the OBDC on September 24, 2010. One is urban, the other is Clackamas Rural SIZ #1, which besides Canby and the county is also sponsored by

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Estacada, Happy Valley, Molalla and Sandy and encompasses virtually all of the county outside the metropolitan urban growth boundary. After that time, there was hardly any interest or activity with respect to SIZs, and nearly 10 years later, local administrative and political understanding about Clackamas Rural SIZ #1 dissipated. As such, contrary to the promise of an SIZ, the Columbia Distributing project encountered confusion and delays as officials relearned and re-familiarized themselves with the concept and the elements for what would have been intended to be essentially automatic processing. In particular, the crucial step of Columbia Distributing’s making application to Business Oregon happened later than it should have, in that work on the building’s concrete slab or foundation was already underway by a couple of weeks. Counsel and tax authorities examined the matter and concluded that the slab could be, and will have to be, treated as outside the project, but that construction beginning weeks later on top of the slab would be allowed with this determination. So, while the agency is looking forward to reminding partners around the state about the SIZ tool using this example, there are lessons learned that must be communicated, as well. Technical deficiencies with the SIZ statutes have also come back into light, for example ..., how does an SIZ ever terminate? Requested Action:

Informational Only For Commission Input/Discussion For Commission action Determination that the Columbia Distributing Warehouse project is subject to tax treatment under ORS 307.123, by approving resolution SIP‒20‒01. It contains further details on the eligibility of the project and other findings.

Oregon Strategic Investment Program (SIP) Projects based on 2020 Annual Employment and Payroll Reports*

Business firm – Project name(In order of determination by the

Oregon Business Development Commission,following county process) County

2018–19 Taxes paid on project property †

Taxes saved on exempt property †

Special SIP fees paid in

2019 †

Net revenue foregone locally †

Year out of 15-year

exemption period †

Total investment by end of 2018 †

Net investment made since

2018

Newly created

jobs ‡Retained

jobs ‡

Average wages/salary

(all jobs) ‡

Average wages and

benefits (all jobs) ‡

State personal income tax revenue ‡

Intel Corporation – SIP2005 Washington $2,231,000 $131,902,000 $39,923,000 $70,083,000 9th $24,984,000,000 $13,640,000 2,482 7,246 $135,725 $155,712 $85,493,000

Georgia-Pacific Consumer Ops. LLC – Wauna Paper Mill–#7 Clatsop $327,000 $2,451,000 $500,000 $1,544,000 11th $465,000,000 $31,940,000 54 0 $91,056 $102,174 $278,000

Genentech USA, Inc. – Hillsboro Fill Finish Facility Washington $3,435,000 $2,261,000 $2,109,000 -$223,000 9th $739,000,000 $43,110,000 530 0 $129,135 $140,861 $4,429,000

EDP Renewables NA/Telocaset…, LLCs – Elkhorn Valley Union $278,000 $770,000 $193,000 $449,000 11th $206,000,000 -$530,000 9 0 $67,347 $80,076 $33,000

Avangrid Renewables – Klondike Wind Power III Sherman $529,000 $3,682,000 $2,731,000 $340,000 11th $459,000,000 -$2,790,000 17 0 $81,193 $691,233 $77,000

Portland General Electric Company – Biglow Canyon Windfarm Sherman $513,000 $9,865,000 $6,374,000 $1,853,000 11th $970,000,000 $16,110,000 26 0 $67,435 $97,299 $94,000

Invenergy, LLC – Willow Creek Energy Gilliam‒Morrow $320,000 $489,000 $146,000 $262,000 10th $130,000,000 $1,130,000 6 0 $57,212 $67,874 $18,000

Avangrid Renewables – Hay Canyon & Star Point Wind Farms Sherman $513,000 $1,915,000 $1,209,000 $388,000 10th $329,000,000 -$1,660,000 11 0 $70,110 $94,649 $43,000

Avangrid Renewables – Pebble Spgs. & L. Juniper II A-B Wind Gilliam $346,000 $2,728,000 $2,129,000 $146,000 10th $537,000,000 -$2,860,000 19 0 $74,975 $101,217 $77,000

Exelon Corporation – Echo Windfarms Morrow‒Umatilla $448,000 $419,000 $195,000 $154,000 10th $108,000,000 – 8 0 $69,291 $91,304 $31,000

Eurus Energy America Corporation – Combine Hills II Umatilla $321,000 $425,000 $194,000 $160,000 9th $137,000,000 $40,000 6 1 $52,559 $58,455 $18,000

NEXTera Energy Resources, LLC – Stateline 3 Wind Umatilla $473,000 $328,000 $341,000 -$67,000 9th $188,000,000 – 4 0 $77,469 $127,135 $18,000

Caithness Corporation – Shepherds Flats–Gilliam County Gilliam $308,000 $8,267,000 $3,845,000 $3,050,000 7th $965,000,000 $1,080,000 43 0 $75,585 $107,330 $176,000

Caithness Corporation – Shepherds Flats–Morrow County Morrow $422,000 $3,390,000 $1,695,000 $1,132,000 7th $278,000,000 $370,000 14 0 $75,585 $107,330 $57,000

Portland General Electric Company – Carty Generating Station Morrow $340,000 $6,999,000 $2,224,000 $3,613,000 2nd $630,000,000 -$117,820,000 26 0 $132,011 $173,616 $225,000

Portland General Electric Company – Port Westward II Columbia $322,000 $2,742,000 $1,350,000 $937,000 4th $303,000,000 $2,810,000 32 0 $129,524 $167,799 $272,000

Intel Corporation – SIP2014–1 Washington $1,810,000 $33,361,000 $4,650,000 $23,173,000 2nd $1,686,000,000 $1,268,820,000 1,885 0 $135,725 $155,712 $16,569,000

T O T A L | A V E R A G E $13,000,000 $212,000,000 $70,000,000 $107,000,000 no data $33.1 billion $1.3 billion 5,174 7,247 $134,378 $154,967 $108,000,000

* For purposes of "gain-share" distributions to local governments under 2007 law, rather than verification of a statutory hiring requirement, of which there is none.

† For latest property tax year ending on prior June 30; 15-year exemption is on project property in excess of taxable portion, which begins at $25, $50 or $100 million and rises 3% per year; taxes paid are on taxable portion and possibly other associated property. Foregone revenue adjusted using standard factor for the approximately one-sixth that is shifted to other taxpayers under local levies, as well as subtracting special payments that consist of the statutory community service fee and locally negotiated amounts.

‡ Newly created and retained jobs (full-time equivalent–2,080 hours/year) associated directly with project, as of previous calendar year, excluding (indirect) jobs with or for construction, vendors, suppliers, tangential company operations, or even on-site contractors, other than a general project operator. State tax revenues based on wage data and latest average tax rates by income level from Department of Revenue statistics; does not include revenue associated with indirect jobs or any induced/multiplier effect of employee spending.

Source : Business Oregon (Oregon Business Development Department). April 24, 2020

RESOLUTION (SIP‒20‒01)

OREGON BUSINESS DEVELOPMENT COMMISSION

DETERMINATION OF APPROVAL FOR STRATEGIC INVESTMENT PROGRAM

Columbia Distributing Warehouse WHEREAS, the State of Oregon Legislature created the Strategic Investment Program (“SIP”) under ORS 285C.600 to 285C.635 (2019), so that enormous capital investments in taxable property by traded-sector industries might be subject to more appropriate assessment and taxation, in order to foster economic growth and to improve employment opportunities in this state and in the areas where such a project is located. WHEREAS, the Oregon Business Development (“OBD”) Commission is charged by law with determining eligibility and establishing the description of the proposed project and the property constituting it for purposes of assessment and ad valorem taxation (“SIP exemption”) as provided under ORS 307.123. WHEREAS, Coho Distributing, LCC, of Portland is building a new facility in Canby, Clackamas County, to be operated under the Columbia Distributing business name for warehousing and wholesaling beverages (“the project”), with a total investment cost of more than $68 million in real and personal property at a location meeting the definition of a “rural area” under ORS 285C.600. WHEREAS, this proposed project is being constructed and installed in a strategic investment zone (“SIZ”) established by the OBD Commission under ORS 285C.623—namely, the Clackamas Rural SIZ #1, sponsored by the cities of Canby, Estacada, Happy Valley, Molalla and Sandy and Clackamas County, and designated on September 24, 2010. WHEREAS, on July 2, 2019, Coho Distributing, LLC, dba Columbia Distribution made application to Business Oregon (the Oregon Business Development Department), which has reviewed and found it to be complete and in order as described in OAR chapter 123, division 623, pursuant to ORS 285C.626 for a project inside an SIZ.

RESOLUTION SIP–20–01 — STATE OF OREGON BUSINESS DEVELOPMENT COMMISSION

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WHEREAS, pursuant to documentation of the proposed project as reviewed by department staff, the OBD Commission also makes the following FINDINGS:

1. The project is an “eligible project” under ORS 285C.600 and 285C.606.

2. The project will directly benefit a “traded sector industry” under ORS 285B.280, in that the proposed property will store and ship goods for wholesale.

3. The project’s total cost will exceed $25 million.

4. Property/property value that will constitute the project is newly constructed or newly installed inside the SIZ and is not:

a. Previously exempt under SIP or under ORS 285C.175 (enterprise zones), or

b. Part of any investment for which the applicant is authorized in an enterprise zone.

5. The county government and the City of Canby have executed a written agreement with the applicant, in accordance with what was established with designation of the SIZ, including provisions for payment of the community service fee under ORS 285C.623(4)(b) and (c) and (5).

6. The applicant has obtained a first-source hiring agreement with publicly funded job-training providers for the term of the exemption through the State Employment Department office in Tualatin.

7. The applicant has made payment to the department under ORS 285C.612 for the required application fee and will pay the administrative fee of $10,000 in total as due after approval by the OBD Commission.

8. The applicant has committed to the following: a. To respond in a timely manner to the requests and needs of

the county assessor for Clackamas County and the Oregon Department of Revenue in their administering the project’s SIP exemption, including but not limited to OAR 150-307-0100, and

b. To ensure for any leased property constituting the project that the ultimate lessee is responsible for the payment of taxes on property as assessed and levied under ORS 307.123.

9. The OBD Commission has not imposed any additional condition on Columbia Distributing related to this SIP project.

RESOLUTION SIP–20–01 — STATE OF OREGON BUSINESS DEVELOPMENT COMMISSION

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10. OBD Commission’s consideration of the SIP application was included on the agenda for the public meeting scheduled through telephone and video conferencing on May 22, 2020.

WHEREAS, the county and special taxing districts (comprising at least 75 percent of such districts’ taxing authority where the exempt property is located) shall agree on the distribution of the community service fee within three months, furnishing the department with a copy of the agreement; otherwise, the OBD Commission shall establish the distribution formula after such time. NOW, THEREFORE, THE OREGON BUSINESS DEVELOPMENT COMMISSION DOES HEREBY RESOLVE THAT:

A. The project that Coho Distributing, LLC, dba Columbia Distributing proposes to operate in Clackamas County is approved under ORS 285C.600 to 285C.635 for the SIP exemption, such that real and personal property of the company shall be assessed and taxed as provided under ORS 307.123.

B. This approved project is further defined by the project description prepared by the department and appended to this resolution.

C. The Commission Chair may execute this resolution.

D. The department shall furnish executed copies of this resolution to the applicant/Columbia Distributing, SIZ sponsors, Clackamas County Assessor, and the Department of Revenue.

ADOPTED BY ACTION OF THE BUSINESS DEVELOPMENT COMMISSION FOR THE STATE OF

OREGON, ON THE TWENTY-SECOND DAY OF MAY, TWO THOUSAND TWENTY.

_______________________________________________ Kanth Gopalpur, Chair, OBD Commission

Attached Appendix

APPENDIX TO RESOLUTION SIP‒20‒01

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PROJECT DESCRIPTION The proposed project as approved shall comprise the Columbia Distributing Warehouse building and all associated structures, real property machinery & equipment and personal property that are owned by Coho Distributing, LLC, or its affiliate, Canby East, LLC, and that Columbia Distributing operates in Clackamas County, Oregon, on tax lots 100, 2100, 2101 & 2200 (map 0301E34), and for which construction or installation began on or after July 2, 2019. As such, the project excludes the foundation or concrete slab on which the building is erected.

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Chapter 237 Oregon Laws 2005 AN ACT SB 879 Relating to strategic investment zones; creating new provisions; and amending ORS 285C.600, 285C.603 and

285C.606. Be It Enacted by the People of the State of Oregon: SECTION 1. ORS 285C.600 is amended to read: 285C.600. As used in ORS 285C.600 to 285C.620: (1) “Business firm” has the meaning given that term in ORS 285C.050. (2) “Eligible project” means a project that meets criteria established by the Oregon Economic andCommunity Development Commission to be exempt from property taxation under ORS 307.123. (3) “First-source hiring agreement” has the meaning given that term in ORS 285C.050. (4) “Publicly funded job training provider” has the meaning given that term in ORS 285C.050. (5) “Rural area” means an area located entirely outside of the urban growth boundary of a city with apopulation of 30,000 or more, as the urban growth boundary is acknowledged on December 1, 2002. (6) “Strategic investment zone” means a geographic area established under section 5 of this 2005Act, within which the property of eligible projects may be exempt from property taxation under ORS307.123. SECTION 2. ORS 285C.603 is amended to read: 285C.603. The Legislative Assembly declares that a significant purpose of the strategic investmentprogram established in ORS [285C.606, 285C.609] 285C.600 to 285C.620 and 307.123 is to improveemployment in areas where eligible projects are to be located and urges business firms that will benefit from aneligible project to hire employees from the region in which the eligible project is to be located wheneverpracticable. SECTION 3. (1) A business firm seeking the exemption under ORS 307.123 for a project the firmintends to install or construct within a strategic investment zone shall apply to the Economic andCommunity Development Department. The application shall be in the form and shall contain theinformation required by the department. (2) A completed application containing all of the required information shall be considered by theOregon Economic and Community Development Commission for the purposes of determining whetherthe project constitutes an eligible project under ORS 285C.606. SECTION 4. ORS 285C.606 is amended to read: 285C.606. (1) The State of Oregon, acting through the Oregon Economic and Community DevelopmentCommission, may determine that real and personal property constituting a project shall receive the taxexemption provided in ORS 307.123 if: (a) The project is an eligible project; (b) The project directly benefits a traded sector industry, as defined in ORS 285B.280; and (c) The total cost of the project equals or exceeds: (A) $100 million; or (B) $25 million, if the project is located in a rural area. (2) In addition to and not in lieu of the determination described in subsection (1) of this section, theState of Oregon, acting through the Oregon Economic and Community Development Commission, shalldetermine that real and personal property constituting a project shall receive the tax exemption providedin ORS 307.123 if: (a) The requirements of subsection (1) of this section are met; and

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(b) The project is to be constructed or installed in a strategic investment zone established undersection 5 of this 2005 Act. [(2)] (3) Notwithstanding subsection (1) or (2) of this section, property may not qualify for the taxexemption under ORS 307.123 if the property: (a) Was previously owned or leased by the business firm benefitting from the tax exemption; [or] (b) Was previously exempt under ORS 307.123 for any period of time; or (c) If located in a strategic investment zone, is not newly constructed or newly installed property. [(3)] (4) The State of Oregon, acting through the State Treasurer, may authorize and issue revenue bondsfor an eligible project that qualifies for exemption under ORS 307.123 if the project also is eligible for fundingthrough the issuance of revenue bonds under ORS 285B.320 to 285B.371. [(4)] (5) A business firm that will be benefited by an eligible project shall enter into a first-source hiringagreement with a publicly funded job training provider that will remain in effect until the end of the taxexemption period. [(5)] (6) If an eligible project is leased or subleased to any person, the lessee shall be required to payproperty taxes levied upon or with respect to the leased premises only in accordance with ORS 307.123. [(6)] (7) For purposes of determining the assessment and taxation of the eligible project in ORS 307.123and the calculation of the community services fee in ORS 285C.609 (4)(b), the Oregon Economic andCommunity Development Commission, when it determines that the project is an eligible project, shall: (a) Describe the real and personal property to be included in the eligible project; (b) Establish the maximum value of the property subject to exemption; or (c) Employ a comparable method to define the eligible project. [(7)] (8) Property of an eligible project that is currently exempt under ORS 307.123 may remain exemptfor any remaining period of exemption allowed under ORS 307.123 upon the property being acquired by abusiness firm that is different from the business firm that initially benefited from the exemption, if the acquiringfirm satisfies all applicable requirements under ORS 285C.600 to 285C.620 and assumes the obligations,conditions, requirements and other terms of the agreement described in ORS 285C.609 (4). SECTION 5. (1) A county seeking to ensure that all eligible projects constructed or installed withina particular geographic area within the county receive the tax exemption under ORS 307.123 may requestdesignation of the geographic area as a strategic investment zone. The request must be made by officialaction of the governing body of the county taken at a regular or duly called special meeting of thegoverning body by the affirmative vote of a majority of members of the governing body. The request mustset forth the proposed boundaries of the zone. (2) The governing body of the county shall forward appropriate actions requesting zoneestablishment to the Economic and Community Development Department for consideration by theOregon Economic and Community Development Commission. If the commission determines that theproposed zone is likely to achieve the purpose set forth in ORS 285C.603 and other objectives establishedfor the zone by the requesting county, the department or the commission, the commission shall designatethe geographic area a strategic investment zone. (3) Any eligible project described in ORS 285C.606 (2) and newly constructed or installed after thedate of zone designation under this section shall qualify for exemption under ORS 307.123 if the businessfirm benefitted by the eligible project complies with the fee agreement described in subsection (4) of thissection. (4) The county may not make the request under subsection (1) of this section unless, after a publichearing: (a) The county and, if the proposed zone will be located within a city, the city have entered into anagreement described in this subsection. (b) The agreement provides for the payment of a fee by each business firm that is to own or operatean eligible project within the proposed zone, as a condition for the exemption under ORS 307.123. Theagreement shall provide for the payment of the fee, as follows: (A) The fee shall be for community services support that relates to the direct impact of the eligibleproject on public services. (B) The fee shall be in an amount equal to 25 percent of the property taxes that would, but for theexemption, be due on the exempt property in each assessment year, but not exceeding $2 million per

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eligible project in any year or, if the eligible project is located in a rural area, $500,000 per eligible projectin any year. (C) The fee shall be paid annually during the tax exemption period by each business firm having aneligible project within the zone, as of a date set forth in the agreement. (c) The agreement provides for the refunding or crediting of overpayments, for interest on latepayments or underpayments and for the manner in which the appeal of the assessed value of the propertyincluded in the project will affect the fee. (5) The agreement described in subsection (4) of this section may provide for any otherrequirements that each business firm must comply with in order for the eligible project of the firm toqualify for exemption under ORS 307.123. (6)(a) The fee collected under subsection (4)(b) of this section shall be distributed by the countybased on an additional agreement described in this subsection. An agreement described in this subsectionis effective only if: (A) The county and the city, if any, in which the eligible project is located have entered into theagreement; and (B) Local taxing districts listed in ORS 198.010 or 198.180 that constitute at least 75 percent of theproperty tax authority of all local taxing districts listed in ORS 198.010 or 198.180 that are in the codearea in which the eligible project is located have entered into the agreement. (b) If an additional agreement is not entered into under paragraph (a) of this subsection withinthree months after the date of the determination by the commission under ORS 285C.606 (1), thecommission shall, by official action, establish a formula for distributing the fee collected under subsection(4)(b) of this section. SECTION 6. Sections 3 and 5 of this 2005 Act and the amendments to ORS 285C.600, 285C.603 and285C.606 by sections 1, 2 and 4 of this 2005 Act apply to strategic investment zones established on or afterJanuary 1, 2006, and to projects for which eligible project designation is sought on or after January 1,2006. SECTION 7. Nothing in section 3 or 5 of this 2005 Act or the amendments to ORS 285C.600,285C.603 or 285C.606 by sections 1, 2 and 4 of this 2005 Act affects the continued eligibility of a projectdesignated an eligible project under ORS 285C.600 to 285C.620 prior to January 1, 2006, for the propertytax exemption provided under ORS 307.123 for a tax year beginning on or after July 1, 2006. SECTION 8. ORS 285C.603 and sections 3 and 5 of this 2005 Act are added to and made a part ofORS 285C.600 to 285C.620. Approved by the Governor June 15, 2005 Filed in the office of Secretary of State June 15, 2005 Effective date January 1, 2006

__________

PDF Version of Email from Bob Blackmore sent 5/18/2020 at 5:32 pm Re: Canby Fire District/Business Oregon Consideration of Eligibility of Columbia Distributing Project in Clackamas County/City of Canby To Oregon Business Development Commission: This firm represents the Canby Fire District, and on behalf of Canby Fire is submitting the above documents and this email in opposition to approval of the COHO Distributing SIZ application. We understand the matter is scheduled for hearing on May 22, 2020, and that this email and attachments will be made of record and considered prior to any decision being made. Please confirm. To summarize, the COHO SIZ is not an eligible project under the statutes or administrative rules. It fails to comply with the eligibility requirements on the face of the application, and cannot fulfill the purpose of the SIZ program as the application is an afterthought and the employment and engagement of local businesses were already lost prior to the applicant filing the application. As a result, the purpose of the SIZ program, which is to incentivize development and employment in rural areas, cannot be fulfilled. The applicant is applying after the fact to benefit from tax avoidance. If approved, the tax avoidance will cost the Canby Fire District significantly in lost revenue, the Project has already and will in the future impose additional fire and rescue burdens, and the loss of revenue will result in the reduction of fire and emergency rescue services currently provided to the citizens of the district. In addition, none of the benefits sought under a SIZ will be realized. The attached letter from Canby Fire points out some of those costs. A summary of the communications above is as follows. 1. The initial letters dated January 4 and 14, 2020 highlight the surprise of Canby Fire in learning of the

proposed SIZ with COHO Distributing. With the exception of the County, City of Canby, and your organization, none of the affected public entities were given prior notice. At that point in time, the Project was already under construction, i.e. legally defined as an existing project, having been started in early 2019, months before the Application was submitted. Construction had also continued without any observation of the requirements of the SIZ for local employment and other provisions of a SIZ. Appropriately, Canby Fire requested a legal eligibility determination since the Project was pre-existing the application, and the benefits of a SIZ were no longer possible.

2. The second attachment, dated January 30, 2020 and entitled Columbia Distribution Impacts, is from the Board of Canby Fire and points out, among other things, that the Project was an existing Project and not eligible. There can be no dispute about this fact since the application confirms the facts of timing and that the project is not eligible under the legal standards. The Application is dated July 1, 2019. The Application states: “In early 2019 Columbia reached an agreement with Trammell Crow Company to develop a 530,148 square foot facility in Canby (see bid narrative). Upon completion of the facility Canby East LLC will acquire the facility and Columbia Distributing will enter into a 15-year lease of the facility.” Based on the criteria of ORS 285C.606(2)&(3), ORS 285C.623(3), ORS 285C626, OAR 123-623-1100 and OAR 123-623-1250, and the terms of the approved Application which states that the Application is “DUE before the purchase or lease of property or any on-site work begins that will comprise investments in the project,” the Project is not eligible. Construction of the project broke ground around February of 2019. It is noted that the SIZ proposal is intended to be an

incentive, which is at the heart of the SAP program, so the Columbia Project fails the purpose of the statute, which is to incentivize employment, and fails the other incentives in the SAP.

In a misguided effort to grant eligibility there has been an administrative effort to bifurcate the project to consider only the work on the Project moving forward. In other words, to create a “phase” approach out of the Project. But, as noted, the Project is not phased, even if that is legal, and the benefits of local employment of the SIZ program have already been lost. The effort to re-define the Project to allow a project to be submitted mid-stream negates the legal intent, and results in the loss of the benefits sought by the SIZ program. This effort is an abuse of the SIZ process in an effort to avoid taxes. In discussion with your legal counsel, Wendy Johnson, she has commented that a project can proceed while awaiting final approval from your commission. We agree, provided an Application has been submitted. That did not happen in this case and the argument is a red herring and misses the point - the application has to be made before the purchase or lease of property or any on-site work begins that will comprise investments in the project. Once the application is made, providing other local approvals are met, the Project could proceed awaiting approval from the Commission. In this case COHO began the project well before they submitted the application. The effort to say that the applicant can proceed by excluding land purchasing and permitting costs, and construction costs prior to the Application again misses the point. The Application, consistent with the statutes, administrative rules and application itself, has to be submitted prior to affirmative steps being taken. If not, the SIZ application process becomes an after the fact effort to avoid taxes and is open to gross abuse. Thank you for your consideration. Robert F. Blackmore Bob Blackmore | Attorney | MBA Finance Innova Legal Advisors PC One Centerpointe Dr., Suite 530 | Lake Oswego, OR 97035 Office: (503) 479-7175 x103 | Cell: (503) 740-8186 bob.blackmore@innovalegaladvisors.com AV Preeminent® Peer Review Rated

CONFIDENTIALITY NOTICE: Please do not read, copy, or disseminate this communication unless you are the intended addressee. This e-mail may contain confidential and/or privileged information intended only for the addressee. If you have received this in error, please notify me via return e-mail. TAX ADVICE NOTICE: IRS Circular 230 requires us to advise you that if this communication or any attachment contains any tax advice, the advice is not intended to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties or (ii) promoting, marketing, or recommending any transaction, plan, or arrangement. A taxpayer may rely on professional advice to avoid tax-related penalties only if the advice is reflected in a comprehensive tax opinion that conforms to stringent requirements. Please contact us if you have any questions about this requirement, or would like to discuss preparation of an opinion that conforms to these IRS rules.

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HAND DELIVERED

January 14, 2020

Honorable Mayor Hodson and Members of the City Council City of Canby 222 NE 2nd Avenue Canby, OR 97013

Re: Clackamas County Strategic Investment Zone Agreement with City of Canby and COHO Distributing, LLC

Dear Mayor Hodson and Members of the City Council:

This firm represents the Canby Fire District ("Canby Fire"). The purpose of this letter is to request that the City table Resolution No. 1330, which is scheduled for consideration and approval during your January 15, 2020 board meeting.

Despite the provisions of ORS Ch. 285C.600 et seq, Canby Fire has not been given notice of the intent to include this project in the strategic investment program ("SIP"), has not been informed of the process and financial impact analysis, and has not been included in any discussions or approval hearings. Canby Fire has not had an opportunity to address the financial impacts that this action will have, nor to consult with the proper parties to determine the allocation of funds should the project qualify and be approved as a SIP project. Given our understanding of the process, it may, in fact, be too late to include the project under the SIP. From an operational perspective, based on our experience with strategic investment zones, if this project goes forward as currently presented, the impact of the loss of financial resources coupled with increased needs for services will significantly erode the quality of the district's services.

Finally, the proposed agreement is effective only if the local taxing districts listed in ORS 198.01 O or 198.180 that constitute at least 75 percent of the property tax authority of all local taxing districts listed in the code area in which the eligible project is located have entered into the agreement. ORS 285C.609(6)(a)(B). So far as we are aware, no other districts have entered into an agreement, and certainly Canby Fire has not entered into such an agreement. Without Canby Fire we question whether the 75% threshold can be achieved. As a result, approval at this time may be legal ly ineffective. We are not aware whether the project has followed the correct process for approval as well. and question whether the project can be exempt from property taxation under ORS 307.123 without proper process.

(503) 479-7175 fax: (503) 905-8766

1 Centerpointe Drive Suite 530 Lake Oswego, OR 97035

In submitting this request to table the Resolution, Canby Fire wants to make it clear that it has not taken a position against the proposed project, but that it needs time and information upon which to consider the project, and to consider the significant financial and operational impacts this project will have on the district .

Canby Fire Chief Jim Davis will attend the meeting and be available to answer any questions.

Sincerely,

lnnova Legal Advisors PC

Robert F. Blackmore bob.blackmore@innovalegaladvisors.com

lNNOVA

EMAIL ONLY

February 4, 2020

Joseph Lindsay City Attorney City of Canby 222 NE 2nd A venue Canby, OR 97013

Dear Mr. Lindsay:

The Canby Fire District ("Canby Fire") has requested that I respond to you to confirm the status of the above, to confirm Canby Fire's position, and to request cooperation moving forward .

Canby Fire's position continues to be that set forth in its January 301h letter, which requested

that the City table Resolution No. 1330 pending determination of the issues with the project's viability. We understand that the project is on the City Council agenda for February 5 for the sole purpose of advising the public that the matter will be tabled pending determination of legal eligibility, which we understand will involve Clackamas County counsel, Rob Fish from the Oregon Business Development Commission, and obtaining an opinion on behalf of the Commission from the Oregon Attorney General's office.

As the determination of eligibility moves forward , and questions regarding the project are addressed, Canby Fire requests that you extend, as a professional courtesy, notice of the steps and timing of events so Canby Fire is fully informed and can determine the extent of its involvement.

I have not copied the City Council on this letter because you represent the City on this matter, but I trust you will provide the Mayor and City Council members with a copy of this

(503) 479-7175 lax: (503) 905·8766

1 Centerpointe Drive, Suite 530 Lake Oswego. OR 97035

communication so they can fully consider the interests of Canby Fire and work with Canby Fire as this moves forward.

As always, please feel free to contact me if you have any questions, and I look forward to working with on this matter as it progresses.

Sincerely,

lnnova Legal Advisors PC

Robert F. Blackmore bob.blackmore@innovalegaladvisors.com