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|Articles - June 2014|
|Thursday, May 29, 2014|
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LESSON 2: It’s hard to get incentives right.
“I’m not typically an advocate of the government telling us what to do,” says Roger Lee, executive director of Economic Development for Central Oregon. A regional economic development agency, Bend-based EDCO uses its knowledge of tax incentives, real estate opportunities and business fundamentals to support business growth in Central Oregon. It has named renewable-energy development as one of seven industry sectors it is targeting. Excess regulation can drive out businesses, Lee says, whereas the right incentives can more effectively change behavior. “I’m a fan of the carrot, not the stick.”
But he warns that it’s hard to get industry-targeted incentives right. Lee points to the controversial Business Energy Tax Credit program, which gave away millions of dollars in green-business-focused tax subsidies but yielded little measurable result. In fact, a 2010 Oregonian investigation revealed several abuses of the BETC program: Walmart netted an $11 million profit by trading energy tax credits without making green investments; an ethanol plant got $12 million in tax subsidies, then declared bankruptcy and shut down; a Boardman business got $3.4 million to support tire recycling — even though it did not recycle tires. “BETC is a good example of an experiment that could have set us back, in terms of economic development policy,” Lee says.
Yet the Northwest Food Processors Association, a Portland-based trade group that advocates for food manufacturers in Oregon, Washington and Idaho, would like to see the return of BETC-like credits. “Many of our members used the Business Energy Tax Credit to make environmental improvements,” says Pam Barrow, director of energy and sustainability at the group. “It got out of hand, but legislative reforms were far too cumbersome. A program like BETC can help companies overcome barriers to making environmental improvements. Businesses already need to be in compliance with regulations, but with the right incentives, many companies will go beyond ‘compliance.’”
Charles Wilhoite, who has examined the finances and business choices of companies across the U.S. as managing director of Portland-based Willamette Management Associates, says his views on incentives are colored by his experiences on the Portland Development Commission and the board of the Nature Conservancy — although he did express surprise at being contacted for a story on “green business.” Subsidizing and actively recruiting environmentally focused businesses comes with political risks, he says. Not every startup will succeed, and when a taxpayer-backed solar business goes bust, skeptics are quick to cry foul. But Wilhoite believes these politically risky incentives can pay off over time. “Whether it’s battery innovations, renewables, electric cars, wind and solar businesses, we have seen opportunities and we are trying to encourage growth across the state,” he says. “To motivate businesses to drop anchor in the region, or to expand here, there have to be incentives.”
Deckert at the Oregon Business Association says he agrees in principle that incentives can play a crucial role in supporting risky yet vital business investments. But he also believes that green incentives should not come at the expense of other economic-development efforts. “We have other clusters. Advanced manufacturing is taking off in the state. We have huge workforce needs. We are building the next ships, airplanes, exporting products, and we can’t find qualified workers in the state of Oregon. That’s a big deal, and we need to make sure we don’t lose sight of that when we focus on green-business incentives.”
In short: there’s consensus that incentives can be an effective way to boost green investments and encourage environmental decision making — but little agreement on which incentives work best.
Tuesday, October 06, 2015
BY CHRIS NOBLE
As we worked on the October cover, it became evident that Nick Symmonds is a hard man to catch — even when he’s not hotfooting it around a track.
Wednesday, September 30, 2015
BY LINDA BAKER | EDITOR
The media coverage about Pope Francis must have put me in a Biblical frame of mind. Because after touring the latest phase of the South Waterfront development, a mind boggling 1.5 million square feet of office and retail space that will spring up north of the aerial tram over the next few years, I couldn’t stop thinking about the massive project as a modern day creation story.
Wednesday, October 28, 2015
BY DIANE BUISMAN
Many employers have questions about what mandatory sick leave means for their company. Take a look at the top 7 questions Oregon employers are asking.
Wednesday, October 28, 2015
BY LINDA BAKER
Veteran political consultant Carol Butler plays to win.
Friday, October 02, 2015
BY KIM MOORE
Our intrepid (and expecting) research editor finds the child care search involves long waiting lists, costly fees and no certainty of securing a place before she goes back to work.
Wednesday, October 28, 2015
BY AMY MILSHTEIN
Oregon's first generation of food entrepreneurs created a brand based on quality and craftsmanship. Can the second generation sustain it?
Thursday, October 08, 2015
BY JACOB PALMER | DIGITAL NEWS EDITOR
Based on several metrics, Oregon has one of the lowest performing K-12 education systems in the country. Teacher compensation is part of the problem.
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