Ecotrust backs new markets

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Articles - February 2011
Thursday, January 27, 2011


Garibaldi Forest Management (top), NewWood Corp. (middle) and ZeaChem (bottom) all benefited from New Market tax credits meant to help economically distressed communities.
Struggling rural towns got a $60 million boost in 2010 from the federal New Market tax credit program and Portland-based Ecotrust CDE, which funneled money from the program into regional businesses creating green jobs in economically distressed communities.

Several promising businesses received investment through the program, among them:

  • ZeaChem Applied Technology, which is building a $40 million plant in Boardman to convert waste sawmill wood into ethanol;
  • Ochoco Lumber, which has completed a wood pellet mill in John Day;
  • Garibaldi Forest Management, which is exploring a new economic model involving carbon storage and habitat restoration as well as wood products.
  • NewWood Corp., which makes composites used for fencing, pallets and other products, made from waste wood and recycled plastic.
Under the program, Ecotrust and other CDEs (short for “community development entity”) receive capital in the form of federal tax credits and invest in businesses expanding in economically distressed areas. Nationally, most new market investments occur in urban areas, but Ecotrust's CDE specializes in rural areas that have lost jobs in natural resource industries. The Ecotrust projects backed in 2010 are expected to retain or create 300 jobs directly and another 500 jobs indirectly.

Bettina von Hagen, who has run the Ecotrust CDE since 2008, says a long pipeline of worthy projects awaits further investment in 2011 and beyond. “We’re seeing a tremendous amount of interest,” she says. “We could do $100 million to $200 million in projects per year.”

President Obama had sought to extend the program at $5 billion per year.  That amount was shaved to $3.5 billion, with more than $25 billion in proposals competing for the money.


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Editor's Letter: Power Play

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There’s a fascinating article in the December issue of the Harvard Business Review about a profound power shift taking place in business and society. It’s a long read, but the gist revolves around the tension between “old power” and “new power” as a driver of transformation. Here’s an excerpt:

Old power works like a currency. It is held by few. Once gained, it is jealously guarded, and the powerful have a substantial store of it to spend. It is closed, inaccessible, and leader-driven. It downloads, and it captures.

New power operates differently, like a current. It is made by many. It is open, participatory, and peer-driven. It uploads, and it distributes. Like water or electricity, it’s most forceful when it surges. The goal with new power is not to hoard it but to channel it.

The authors, Henry Timms and Jeremy Heimans, don’t necessarily favor one form of power over another but merely outline how power is transitioning, and how companies can take advantage of these changes to strengthen their positions in the marketplace. 

Our Powerbook issue might be viewed as a case study in the new-power transition. This annual book of lists provides information on leading businesses, nonprofits and universities in the state. Most of the featured companies are entrenched power players now pursuing more flexible and less hierarchical approaches to doing business. Law firms, for example, are adopting new technologies and fee structures to make legal services more accessible and affordable.

This month we also take a look at a controversial new U.S. Securities and Exchange Commission rule requiring public companies to disclose the median pay of workers, as well as the ratio between CEO and median-worker pay. 

Part of the 2010 Dodd-Frank financial reform law, the rule will compel public companies to be more open about employee compensation, with the assumption that greater transparency will improve corporate performance and, perhaps, help address one of the major challenges of our time: income inequality.

New power is not only about strategy and tactics, the Harvard Business Review authors say. “The ultimate questions are ethical. The big question is whether new power can genuinely serve the common good and confront society’s most intractable problems.”

That sounds like a call to arms. Or a New Year’s resolution. Old power or new, the goals are the same: to be a force for positive change in the world. Happy 2015!

— Linda

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