At a time when many small Oregon cities are struggling to balance economic growth with limited resources, Prineville has emerged as an example of what can happen when local leaders think decades ahead.
The Crook County community has transformed itself into one of Oregon’s strongest rural economies, attracting private investment, growing wages and diversifying its industrial base. Today, industries ranging from information technology and construction to advanced manufacturing and logistics play significant roles in the local economy.
According to Kelsey Haskett, Prineville/Crook County director for Economic Development for Central Oregon (EDCO), the foundation for that success was laid years ago through a combination of strategic leadership, infrastructure investment and a willingness to tackle challenges before they became problems.
“I think a lot of it is local leadership,” Haskett said. “Prineville is run a lot like a business. There’s a willingness to think long term while staying practical with what the area can support and being business-friendly — not immediately saying no, but figuring out ways to get creative and get businesses the resources they need.”
That mindset helped reshape the local economy over the past 15 years. During the Great Recession, Crook County faced unemployment approaching 20 percent. Today, unemployment sits near historic lows, wages have climbed dramatically and the community has become far more economically diverse.
The transformation happened with intent. Prineville’s leaders consistently invested in infrastructure that many communities only begin planning after growth arrives.
Water as a Competitive Advantage
As communities across the West grapple with drought, water restrictions and uncertainty about future supplies, Prineville finds itself in a drastically different position.
Decades of planning and regional collaboration have helped create one of Oregon’s most robust municipal water systems, centered around the City of Prineville’s Aquifer Storage and Recovery (ASR) program. The system allows water to be stored underground during periods of high availability and recovered when demand peaks during the summer months.
“The storage capacity that affords us is one of the most valuable aspects of the project,” said Casey Kaiser, Public Works Director and Assistant City Manager for the City of Prineville.
Rather than relying solely on costly above-ground storage facilities, Prineville utilizes a naturally occurring confined aquifer beneath the community. The underground system is believed to hold as much as 800 million gallons of water, with more than 400 million gallons currently available for municipal use.
The project traces its origins back more than two decades, when hydrologists identified an ancient Crooked River channel capable of serving as a natural underground reservoir. It builds upon an even longer history of water planning that includes the construction of Prineville Reservoir and Bowman Dam in the 1950s and the eventual passage of the 2014 Crooked River legislation, which secured 5,100 acre-feet of stored water dedicated to future municipal growth.
“Water is not a bottleneck for us for growth,” Kaiser said. “We’ve built out a water system that allows future city councils to attract whatever industry they might want to attract to the community.”
That advantage has become increasingly important as Prineville continues to attract industrial development, including data centers and manufacturing operations.
Kaiser notes that while data centers often draw public attention because of their water use, they currently account for only about ten percent of the city’s annual water consumption. The city uses between 680 million and 720 million gallons of water annually, with demand increasing dramatically during hot summer months.
“Some of the most efficient data centers in the world are located right here in Central Oregon,” Kaiser said, noting that cool evening temperatures are a big help. “The entire data center sector here uses about as much water as 120 acres of irrigated farmland.”
The city’s focus now is on strengthening resiliency through additional recovery wells, booster stations and backup infrastructure. The goal is to ensure water remains a competitive advantage for decades to come.
Seeing Prineville’s Potential
Another key advantage to Prineville’s growth has been the availability of large industrial real estate sites that allowed it to compete for projects that might otherwise bypass a rural community. Such parcels are now scarcer, and more than 200,000 square feet of industrial space has either been recently completed or is currently in construction. Primary tenants include data centers, advanced manufacturing facilities and logistics operations.
One example of Prineville’s economic momentum is CV International, which is developing a new 70,000-square-foot manufacturing facility in Tom McCall Industrial Park. The company, which produces specialized equipment serving aviation, energy and industrial markets, selected Prineville after evaluating locations throughout Oregon.
According to George Darcy, chief marketing officer for CV International, the decision reflected both the community’s business climate and its long-term growth potential.
“Prineville offers one of the best overall value propositions in Oregon, with favorable tax incentives, strong infrastructure, and a highly supportive economic development environment,” Darcy said. “The partnership-oriented approach from EDCO, the City, and Crook County, combined with streamlined processes, made Prineville an ideal location to scale our manufacturing footprint and position the company for sustained growth.”
The project will bring a range of manufacturing and professional positions to the community, including welders, fabricators, machinists, assembly technicians, engineers and office personnel. Company leaders say the investment reflects Prineville’s ability to support long-term expansion and advanced manufacturing growth.
“What excites us most is the opportunity to operate within a purpose-built, 70,000-square-foot facility designed for both current production and future expansion,” Darcy said. “Looking ahead, we see Prineville as a long-term home where we can continue to grow our team, expand capabilities, and deliver innovative solutions that support critical industries while contributing meaningfully to the local community.”
A Historic Railway Drives Today’s Growth
While water infrastructure and industrial land have helped Prineville grow, another community asset has played a critical role in attracting businesses and supporting economic development for more than a century: the City of Prineville Railway.
One of the oldest continually operated municipal railroads in the United States, the City of Prineville Railway functions as both a city department and an enterprise fund, operating much like the community’s water and sewer utilities.
“For more than a century, the City of Prineville Railway has been an economic engine for the community,” said Matt Wiederholt, general manager of the City of Prineville Railway. “Generations of residents have benefited from the jobs, business opportunities, and public investments made possible through the success of the railway.”
The railroad’s origins date back to 1918, when local leaders stepped in after private operators declined to build and manage a rail connection to the community. After decades of success that helped fund public improvements, rail traffic fell sharply, reaching a low point in 2004 when only 84 railcars moved through the system. City leaders responded by repositioning the railway as an economic development tool, creating a transload facility that gives businesses access to the national rail network without requiring their own rail infrastructure.
Today, the railway serves 36 customers and supports more than 200 direct jobs throughout the region.
“Customers ship and receive products from the East Coast, Canada, Mexico and everywhere in between,” Wiederholt said. “Commodities moving on the Prineville Railway include propane, industrial chemicals, fuel additives, golf course sand, cattle feed, lumber, plastic pellets used in pipe manufacturing, tire ballast, magnesium chloride de-icer, barley for beer production, asphalt, salt, stove oil, and cement.”
The railway has also become a powerful recruitment tool. According to Wiederholt, seven businesses with on-site employees have located in Prineville specifically because rail service was available.
“The availability of rail service provided our community with a competitive advantage and was a key factor in attracting these businesses to Prineville,” he said.
Wiederholt believes one of the railway’s greatest strengths comes from its municipal ownership structure. Because the railroad is part of city government, prospective businesses can work directly with decision-makers from multiple departments simultaneously.
“In a single meeting, representatives from the railroad, water, sewer, planning, fire, land use and transportation departments can work collaboratively to address a prospective customer’s needs,” Wiederholt said. “This streamlined approach allows us to respond quickly and efficiently when businesses are evaluating locations.”
Looking ahead, Wiederholt sees the railway continuing to play a key role in attracting manufacturing and production-based industries that provide family-wage employment opportunities.
“Historically, industries that utilize rail service are involved in production and manufacturing,” he said. “These are the types of businesses we want to attract to our community because they provide family-wage jobs, support economic prosperity and contribute to a diverse employment base.”
Building a More Diverse Economy
While data centers have attracted significant public attention, Haskett said diversification remains the community’s primary economic development goal.
“Our main goal is to diversify each economy,” she said. “It’s about making sure we don’t have all our eggs in one basket.”
That strategy appears to be working. Crook County recovered jobs more quickly than many communities following the pandemic, demonstrating a resilience that was largely absent during the Great Recession. Haskett credits that performance to a broader mix of industries and continued reinvestment from existing employers.
“We have a pretty good balance of both new businesses coming to the area and existing businesses reinvesting because they’ve had good experiences with the process and leadership,” she said.
Today, EDCO continues to focus on advanced manufacturing, aerospace and aviation-related businesses, energy innovation, agriculture, food processing and supply-chain industries that support existing employers. Crook County has also benefited from rising wages, driven in part by technology-related industries and advanced manufacturing employers.
Despite its momentum, Prineville and Crook County face many of the same challenges confronting growing communities across the West. Housing affordability, workforce recruitment and infrastructure capacity remain top concerns.
“I think the big challenge is balancing growth while continuing to invest in amenities and infrastructure and things that make a community livable and attractive to residents and businesses,” Haskett said.
