In the past 11 years, investment into the local community by Dupont-Pioneer Seed and Shearer’s Foods have resulted in 278 full-time jobs with an annual payroll in 2014 of $7.9 million.
That is a direct result of the tax incentives offered by the Hermiston Enterprise Zone, which allows property tax exemptions for industrial employees locating to Hermiston or expanding existing operations.
“This is an enticement that a lot of large, major businesses demand,” said Hermiston Mayor Dave Drotzmann during Monday’s city council meeting. “It helps us remain competitive when looking at economic development opportunities.”
That enticement, however, is about to expire. So on Monday, the council voted to apply for a renewal of the enterprise zone.
By having an enterprise zone, the city can give companies a three-year property tax exemption for new buildings or machinery if those investments create at least one job or leads to an increase in the company’s local employment of at least 10 percent – whichever is greater, said Hermiston City Manager Byron Smith in a report to the council.
Smith also highlighted the “Extended Abatement” program, which allows for a company to get a four- or five-year tax exemption if the jobs created have a total compensation of at least 150 percent of the Umatilla County average annual wage. For 2015, said Smith, the threshold to reach to receive a five-year exemption is $53,000 per year.
Smith said Pioneer Seed’s initial $35 million expansion in 2009 will come on to the tax rolls in July. He expects the city to receive around $180,000 in new General Fund revenue for Fiscal Year 2015-16.
“This is an important tool we need to keep in our tool box,” Smith said.
Also at Monday’s meeting, the council voted to initiate a proposed property annexation. Frank W. Gehring Construction and Rex Heidt are proposing to annex two acres at S.W. 10th Street and Olive Avenue in order to develop an eight-lot subdivision on the property.
The council also approved a recommendation by Smith to change the procedure at council meetings, allowing for public comment on individual agenda items throughout the meeting.
The council also held an executive session for a six-month performance review of Smith, who succeeded Ed Brookshier last August.
“Thank you for the first six months,” Drotzmann told Smith after the executive session. “You’re off on the right foot.”
