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Regional Report: Pacific States Foster Innovation

Winners of numerous accolades, the Plains States are garnering investment across diverse industry sectors and growing their economies.

Karen Thuermer (Directory 2014)
Job Creation Efforts
Business Oregon is offering a jobs creation scheme through its new Business Expansion Program (BEP). BEP is available to traded sector firms with at least 150 employees that create at least 50 new, full-time jobs at 150 percent of the state or county average wage. BEP awards are based on two years of estimated personal income tax revenues that are generated by the new hires from an expansion or relocation project and contain clawback provisions if the requirements are not met. Salesforce.com benefited from BEP upon deciding to locate in Hillsboro, Oregon. With help from a $1.45 million forgivable BEP loan, the company established a shared service center in Hillsboro and promised to employ slightly more than 200 employees by end of 2015. By late 2013, the Portland Business Journal reported the company had hit that target and would create close to 500 jobs within five years.

Work force training is a focus and mission of the Washington State Department of Commerce and its partners. They offer a variety of programs and financing options including the Washington Customized Training Program. Impact Washington, a non-profit organization, helps manufacturers become more globally competitive.

Innovation Is Key
Innovation is on the top of everyone’s list. Oregon InC is helping entrepreneurs turn cutting-edge research into new companies through the creation of the 2013–2015 Innovation Plan. A unique partnership between Oregon’s private sector and its research universities, its goal is to find new ways to further nano-science and green building materials, wave energy, bioscience, and electric vehicle components, and create growth opportunities in unmanned aerial vehicles and digital storytelling.

As part of Washington’s innovative clusters initiative, the state has launched a series of Innovation Partnership Zones (IPZs). One is the Tri-Cities Research District, a 1,700-acre mixed-use area along the Columbia River in Richland. More than 7,000 people work in this IPZ, which is home to the Pacific Northwest National Laboratory (PNNL); Washington State University-Tri-Cities (WSU-TC); the Applied Process, Engineering Laboratory (APEL); and WSU-TC’s new Bioproducts, Sciences, and Engineering Laboratory (BSEL).

Salinas, California, has created its own unique initiative intended to create precision farming technology and smart farms. Known as the Steinbeck Innovation Cluster, it leverages a network of civic, academic, technological, corporate, and philanthropic partners to create smart farms that tap into technologies like big data, mobility, sensors, and drones. The goal is to drive innovation in Salina’s fields and factories and foster young entrepreneurs.

Financial Incentives
Seeking to ramp up business in California, Governor Jerry Brown signed the Economic Development Initiative this summer, which offers a statewide tax exemption on all manufacturing and R&D equipment purchases for biotech and manufacturing companies. It includes a state sales tax exemption on innovative tools.
San Diego-based Takeda California, a wholly owned subsidiary of Takeda Pharmaceutical Co. Ltd., Japan’s largest pharmaceutical company and one of the top 15 pharmaceutical companies in the world, is taking advantage of the initiative. “The new law will allow us to pursue staffing levels and collaborations with local universities that we would not have been able to afford otherwise,” said Takeda California President and Chief Science Officer Dr. Keith Wilson.

Tax-exempt bonds and loans support businesses in the Pacific region. In Oregon, tax-exempt bonds are available for long-term financing for land, buildings, and equipment to manufacturers, processors, exempt facilities (e.g., docks or solid waste facilities), and nonprofits. They provide the greatest benefit for bonds of $5 million or more.

Murphy Company, a supplier of hardwoods and plywoods, became a recipient of a $10 million industrial revenue bond in late 2013. The bond is helping the company purchase and house a new dryer at its White City, Oregon, facility that will produce dry veneer for its Rogue River Plywood Plant, and eventually result in increased production to three shifts with 150 to 200 employees, including 65 new full-time jobs.

Energy-Efficiency Programs
A loan program offered by GreenSun Hawaii provides residential, multi-family projects, nonprofits, and businesses with affordable financing for the installation of energy-efficient and renewable energy systems. Launched in 2011, the program is a public-private partnership that provides loans to increase the use of solar energy, decrease Hawaii’s dependence on imported fossil fuel, and lower overall energy costs throughout the islands. Annually, the program calculates an estimated savings of 556,000 kilowatt hours and a combined savings in the participants’ electric bills in excess of $221,000.

Utilities are a focus in Alaska and in Canada’s Yukon region. In October, both governments signed an appendix to the Alaska-Yukon Intergovernmental Relations Accord to collaborate in identifying and evaluating an economic development corridor that could potentially connect fiberoptic networks in Juneau and include a Ketchikan to Prince Rupert link, as well as energy projects to provide access to affordable electrical generation. Wording of the agreement allows other entities to participate, by mutual consent. Both governments anticipate participation from the Municipality of Skagway and respective utilities. They also expect interest from telecommunication firms that could provide data and insight into the potential for broadband expansion in the Upper Lynn Canal region.
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