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Nike seeking Washington County tax breaks

Special session takes up state tax situation Friday


Nike is seeking financial incentives from Washington County to expand its World Headquarters near Beaverton.

The incentives are in addition to the greater state tax certainty that will be considered by the special session of the Oregon Legislature that Gov. John Kitzhaber has called for Friday.

Kitzhaber says Nike could eventually create 12,000 direct and indirect jobs by 2020, boosting Oregon’s economy by $2 billion a year. Nike Chief Financial Officer Don Blair has promised the company will expand in Oregon in exchange for the greater state tax certainty. The minimum investment being discussed is $150 million to create 500 jobs over five years.

But Nike has not said where in the state it will expand, despite having the vast majority of its Oregon employees in and around its unincorporated Washington County campus. Beaverton Mayor Dennis Doyle says his city is prepared to help with the expansion, but has not yet been asked.

"No decision has been made on where the expansion would occur," says company spokeswoman Mary Remuzzi.

Nike and Washington County officials have been quietly discussing possible financial incentives for months. They will not confirm them publicly, however. Asked directly if Nike was looking for financial incentives from the county, Remuzzi would only say, "We don't have specifics to share on your other question." County officials were equally noncommittal.

But sources familiar with the discussions say they began well before Nike approached Kitzhaber with its concerns over future state tax changes a little more than a month ago. The discussions have included the possibility of the county waiving property taxes on any new Nike buildings, including the land where they are built.

The company currently employees approximately 8,000 employees in the county. Nike’s Oregon employment has grown 60 percent since 1970, and the company has bought and leased several buildings near the campus in recent years to accommodate the additional employees. The company could still expand within and near the campus, however.

The county already participates in a state program that waives property taxes to encourage economic development projects. Called the Strategic Investment Program, it has been used to encourage expansions at Intel’s Ronler Acres Campus.

The current program mostly waives taxes on new equipment, not land and buildings. The Washington County Board of Commissioners would need to change its policies to accommodate Nike’s request.

The timing of Nike’s requests comes at an awkward time for the state and county. The state has not yet paid the county $12 million it is owned for waiving property taxes to encourage the Intel expansions. The money is 50 percent of the additional income taxes collected by the state from the new Intel jobs. It is owned to the county under a SIP provision called Gain Share.

State officials initially said they could not make the payment because of technical reasons. They recently indicated the payment would arrive this month.

But news of the payment prompted state Sen. Genny Burdick (D-Portland) to say the 50 percent share is too large. She has promised to ask the 2013 Oregon Legislature to reduce the share, something the county opposes. Democratic state Sen. Mark Hass, who represents Beaverton, supports keeping the share at 50 percent.

Both Burdick and Hass were appointed to the special joint legislative committee scheduled to consider the Nike-related legislation. It was expected to meet Thursday morning and pass the legislation to the full Legislature for consideration on Friday.



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