Enterprise zones are designed to incentivize new business investments through property tax exemptions for three years. Businesses locating or expanding in an enterprise zone may be eligible to receive an exemption from property taxes on new investments including building construction, improvements, and equipment.

Businesses eligible to receive the exemption include manufacturers, processors, shippers, other traded sector business, and call center/headquarter facilities.

For more information, contact James Graham at jgraham@orcity.org.

Business Eligibility

Enterprise zones are primarily directed at for-profit organizations that provide goods or services to other business operations.

• Ineligible operations include: tourism, retail food service, entertainment, childcare, financial services, property management, housing and construction. retail sales of goods or services, health care, or professional services.

• An eligible call center may receive customer requests and orders by various means, but at least 90 percent must originate from areas that would entail a long-distance charge if performed by telephone.

• Central facilities, or “headquarters,” for management, marketing, design, etc., are eligible if serving statewide or wider operations of a company.

Employment:

To be authorized, eligible business firms must commit to satisfy job-creation requirements:

• The number of full-time jobs in the zone must rise and be maintained during the exemption at a minimum of 110 percent of the average level from the time of the authorization application.

  • Failure to reach this level precludes the exemption.

  • Failure to maintain this level represents “substantial curtailment,” as would a big drop in total employment.

• Your firm must enter into a first-source hiring agreement before hiring new employees.

• Your firm must pay employees at least 150% of the State minimum wage ($15.95 per hour for 2024 for the Portland Metro Area)(benefits can be used to reach this pay level).

The business firm is disqualified if:

• The transfer of operations into the enterprise zone results in Oregon job losses more than 30 miles from the zone boundary.

• The movement of employees into zone from outside but within 30 miles results in less than a 10 percent increase of the combined employment level in the zone and from where they are transferred.

Property:

In general, any work on a new property or to prepare land must begin only after an application is submitted. See the Enterprise Zone Application above to view exceptions.

• All property needs to be new, meaning it wasn’t used or occupied in the zone more than one calendar year before the exemption is claimed.

• Machinery and equipment also must be newly acquired or newly transferred from outside of the county.

• Any or all property may be leased from any party, provided that your firm (the lessee) is obligated to pay the property taxes.

• All real property listed on the exemption claim property schedule must cost $50,000 or more in total.

• Personal property machinery and equipment is readily movable and qualifies subject to a per-item cost minimum.

• Land, vehicles, motorized/self-propelled devices, rolling stock, non-inventory supplies, and idle or ineligibly used property don’t qualify.

• The investment in the property needs to be for the furtherance of income.

To read all eligibility requirements, please review the Enterprise Zone Application linked above.