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State must focus on business

MY VIEW • Lower taxes, tax credits will help economy
by: JONATHAN HOUSE, Hopworks Urban Brewery owner and brewmaster Christian Ettinger stands in the freezer where beer is stored after the brewing process. A My View writer decries a proposed increase in state beer taxes, writing that it will hurt the state’s microbrewing industry, and writes that the state must become more business-friendly.

It is, indeed, disappointing that Oregon finds itself with the second highest unemployment rate in the nation at 12.1 percent, followed only by Michigan. So, I was surprised by the lack of concrete solutions you provided in the editorial 'A state without jobs, or strategy' (Apr. 16).

Instead, you suggest having a 'unified economic strategy that includes public schools, community colleges, universities, transportation, land use, water and environmental policy and housing.'

It sounds like the Portland Tribune is suggesting, in part, that poor education or a lack of funding of education is causing high unemployment. This is not supported by evidence. According to the U.S. Census Bureau, 27.6 percent of Oregonians 25 years and older have bachelor's degrees. In contrast, only 20.1 percent of people in the same age range in Louisiana have bachelor's degrees. But their unemployment rate, at 5.8 percent, is less than half of Oregon's.

The census bureau also indicates that Oregon's funding per public elementary-secondary student is around the median (about half the states spend more, half less). States like Utah and Oklahoma spend 20 to 35 percent less per student, yet they have unemployment rates that are less than half of Oregon's.

The other non-education parts of the strategy that you suggest include focusing on transportation, land use, water and environmental policy. Yet aren't we already known for these things?

Don't other city and state officials come to Oregon to marvel at our land use and planning, expansion of our light rail system, our airport that was rated number one by Conde Nast and our inland port with access to the Pacific Rim? Aren't we known for being on the forefront of the 'green' and sustainable movement?

I would suggest that the reason that we are having high unemployment is not because we have failed to focus strongly enough on education, transportation, land use, water, environmental policy and housing. Rather, our high unemployment rate is due to a lack of focus on attracting businesses to Oregon and making it a business-friendly environment.

Let me provide an example: the proposed 1,900 percent increase in beer tax that would impact 96 Oregon breweries that employ 5,000 people, and contribute $2.25 billion to the state gross domestic product. If you are considering starting a business in Oregon or moving one here, wouldn't it make you think twice if you believe that the state's politicians think it is reasonable to consider increasing taxes or fees by such an astronomical amount?

I would like to propose an alternate strategy for preventing future high unemployment rates to consist of the following:

• Eliminate the Portland business tax.

• Provide state tax credits for employers who demonstrate creation of jobs with wages that exceed state median household income.

• Provide incentives or co-investment to encourage more venture capitalists to locate here. (While they may invest in other states, their presence will encourage more local entrepreneurial activity, and possible relocation of businesses they invest in that are non-geographic-dependent.)

• Use empty government buildings (like shuttered schools) to provide very low-rent incubator space for start-ups.

• Actively recruit and provide incentives to larger California businesses that need access to the Pacific Rim but are dissatisfied with the California regulatory climate.

Eric Williams is the president of Codiligent LLC, a Portland business brokerage representing buyers and sellers of businesses with $500,000 to $20 million in annual revenue. He lives in Northwest Portland.