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Enterprise zone OK'd for A.R.E. Manufacturing

Company will receive three-year tax break on value added by new machinery

A.R.E. Manufacturing has been accepted into Newberg’s enterprise zone, which will give the company a three-year tax break on the improvement value of two recently purchased machines, in exchange for the company hiring several new employees.

The first new purchase was a coordinate measuring machine, a $75,000 computer-operated device that provides precise measurements of parts.GARY ALLEN - A coordinate measuring machine purchased by A.R.E. Manufacturing for about $75,000 helps with precise measurements, particularly in machining parts for 3D printers, which the company has been working on recently.

The device is particularly useful for products that require a high degree of precision, such as the manufacturer’s recent contracts machining parts for 3D printers.

There are analog measuring devices as well, but with the 3D printers having little room for error those are not feasible.

“Really, it’s just too hard to do with the standard equipment,” owner and founder Alvin Elbert said.

Besides the measuring machine, the company also bought a new horizontal machining center, a milling machine which carries a price tag of roughly $500,000.

Overall the company spent about $575,000 on the new equipment, and property taxes on the value of the new machines will be waived for the coming three years.

“It’ll help us quite a bit,” Elbert said.

In exchange, the company is required to hire four new employees during the enterprise zone years. The manufacturer has already hired three new employees since the enterprise zone approval, and Elbert estimated within a few months all the hiring requirements will be satisfied and likely exceeded, as he said there could be a need for up to 10 new employees.

In all the company has about 50 employees including the new hires, Elbert said.

It’s fitting the manufacturer is now taking advantage of the enterprise zone program: Elbert suggested a couple years ago to former Newberg economic development director David Beam that the city implement an enterprise zone process.

Elbert had learned of the process shortly after his company spent $500,000 on a new machine, and he thought it might be useful for the next time they made a big purchase. But the company didn’t apply for the program until March of this year.

“We kind of said, ‘why don’t you do this,’ then forgot about them,” Elbert laughed.

It could be the first company to fully take advantage of the program. After the enterprise zone program was established in Newberg in the spring of 2014, the Newberg paper mill then owned by S.P. Fiber Technologies applied for the enterprise zone that fall. Its application was based on the plan to convert one of its paper machines from producing newsprint to producing brown paper.

It was approved in January 2015 for a five-year tax break on more than $12 million in capital improvements. But just 10 months later the mill was idled by new owner WestRock and is now permanently shuttered.

In early 2015 Climax Portable Machining & Welding Systems applied for the enterprise zone program, with a caveat that it would not be adding new employees but would be increasing productivity and would continue its strong internship program. But a few months later, the business withdrew its application.

A.R.E. is a contract manufacturer, meaning the business makes parts that go into other products, but doesn’t market products to the public itself.

Elbert started the business in his garage back in 1980, as a part-time job. The business grew, particularly as Elbert started contracting for dental manufacturer DCI, which became his biggest customer for some time.

The company moved into its current location in 1987.