Oregon House Passes Bipartisan Legislation Aimed to Make Oregon a Leader in Technology & Communications Infrastructure

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(Photo above: provided by Alan Brandt)

Legislation to move Oregon forward as a leader in high-speed technology and communications infrastructure passed the House of Representatives today on a 52-2 vote. The bill will have a major impact on Apple and Facebook data centers based in Prineville.

Senate Bill 611B is a bipartisan agreement that aims to retain and attract communications companies and family-wage jobs to the state by updating Oregon’s central assessment laws to provide certainty for these companies as they look to build data centers and invest in expanded operations throughout the state, including rural Oregon.

“This bipartisan bill is a win for the entire state of Oregon,” said House Republican Leader Mike McLane (R-Powell Butte), who worked extensively with lawmakers and stakeholders to craft the legislation. “By passing this bill today, we’ve secured family-wage jobs at high-tech data centers in rural parts of the state while opening the door for Oregon to become a national leader in technology and communications infrastructure. SB 611B is the culmination of months of hard work by a diverse and bipartisan group of legislators and stakeholders who put aside political differences to find a plan that updates our laws to reflect changing technologies and move Oregon forward.”

SB 611B updates and fixes several complex taxation issues, including central assessment, that were affecting the operations of more than 20 communications companies in Oregon. Central assessment refers to Oregon’s property tax formula for certain industries, including railroad companies and communications companies. In addition to assessing tangible or actual physical property, the central assessment formula takes into account intangible assets, such as the overall value or net worth of a company. As part of the bipartisan agreement reached under SB 611B, data centers will not be defined as communications companies for the purposes of central assessment, allowing for global companies like Facebook and Apple to continue investing and expanding data center operations in Oregon.

“Central Oregon is home to several data centers that employ dozens of Oregonians in highly skilled positions,” said Rep. McLane, whose data center legislation, dubbed the “Facebook Bill,” was passed and signed into law in 2012. “These data centers generate much-needed additional revenue for our central Oregon communities and invest in our neighborhoods, schools and families. I will continue to work with the Legislature to protect and expand these crucial investments for central Oregon families.”

In a letter to lawmakers, Prineville Mayor Betty J. Roppe highlighted some of the economic benefits brought to the Prineville community through Facebook’s data center facility, including:

• 150 full-time jobs, 70% of which are jobs local to Crook County
• $50,000 average wage (salary and benefits)
• $1 million annually to city in power franchise fees
• $1 million in local investment through grants program and school technology upgrades
• $110,000 annual community fee
• $60,000 for local transportation improvements

Additionally, SB 611B provides some tax certainty for communications companies by placing a 130% cap on their taxable intangible assets and also lays the groundwork for Google Fiber to consider moving into Portland.

In order to directly address the immediate uncertainty facing communications companies in Oregon, the Senate and House both moved to suspend rules in order to quickly consider the legislation. Senate Bill 611B will now go back to the Senate for a concurrence vote. An earlier version of the bill had passed the Senate 27-3.

www.oregonlegislature.gov/mclane

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