Troubling Tax Breaks for Data Centers

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One.

That’s how many jobs LinkedIn had to promise it would create to get five years of big property tax breaks for its new data center in Hillsboro that opened in mid-November.

LinkedIn told DatacenterDynamics that the major reasons it chose Hillsboro were: (1) access to green energy resources; (2) access to good global communications networks; (3) mild temperatures; and (4) tax exemptions in Oregon’s Enterprise Zones.

The reasons may be right, but don’t believe the order LinkedIn gave. “It is doubtful if this was the real decision-making hierarchy since taxes would be the data center’s biggest operating cost,” DatacenterDynamics said.

In other words, the property tax exemption under Oregon’s Enterprise Zone program, which can be worth millions to qualifying companies, was the major lure.

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LinkedIn’s new data center in Hillsboro

Oregon’s Enterprise Zones are designed to attract investments by exempting businesses from 100 percent of local property taxes on new plant and equipment investments for up to two years while construction is in process and up to five years after that if they are growing employment in the zone.

Enterprise Zone contracts require that if a data center already operates inside the Zone and applies for benefits or renewal, it is required to increase employment by just ten percent. If a firm locates a new data center in the Zone it only needs to add one employee to be in compliance.

Because IT equipment in a data center must usually be refreshed within 5 years, the net effect is that there is no tax in Enterprise Zones.

But is the tax break justified?

Hillsboro’s aggressive marketing of the tax exemption has drawn multiple data centers to the city, all gobbling up valuable land within the urban growth boundary and generating a minuscule number of jobs. Current data center operators  include Infomart, ViaWest, Telx, NetApp and T5. LinkedIn’s data center is located in property leased from Infomart.

Infomart says its Hillsboro site benefits from a combination of energy efficiency, inexpensive power, abundant domestic and Trans-Pacific network choices. The most important benefit, however, is the five-year real and business property tax exemption for new equipment and construction. “Since IT equipment is typically refreshed within 5 years, the net effect is that there is no tax, neither sales nor property, on IT equipment in these Enterprise Zones,” Infomart highlights on its website.

That “translates to massive cost-savings for our customers,” Infomart says, and makes Oregon “… the lowest cost state for leased data center operations in the United States.”

Thankfully, Hillsboro taxpayers can easily find out the value of the tax abatement each of the multi-million dollar data centers is getting from the city. That way the public can judge whether the foregone taxes are worth it in terms of investments made and jobs created. Right?

Sorry.

The Washington County tax assessor’s office has determined that the amount the Enterprise Zone property tax exemptions save each data center annually is confidential and exempt from disclosure.

So before everybody gets carried away celebrating LinkedIn’s new data center, and heralding all the other data centers taking advantage of Enterprise Zone tax breaks, a harder look at what’s being given away to all these companies, for not much in return, is in order, particularly given the state’s budget situation.

Maybe this is something the Our Oregon folks could look at now that they’re not so busy after the defeat of Measure 97.

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Post-Election: More of the Same

“Much of the mainstream, legacy media continues its self-disgrace. Having failed to kill Donald Trump ’s candidacy they will now aim at his transition. Soon they will try to kill his presidency.

Columnist Peggy Noonan, Nov. 19, 2016

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New York Times Headlines from just one day, November 19, 2016

Trump Selects Loyalists on Right Flank: Strident Team of Like Minds

Donald Trump’s Disturbing Picks

Michael Flynn (Trump’s pick for National Security Adviser), Too Hotheaded for a Sensitive Position

As Trump Rises, So Do Some Hands Waving Confederate Flags

Amid Divisions, a March Seeks to Unite Women

Diplomats Shift Focus to a New Threat Facing Paris Pact: Trump

 Disoriented ‘Never Trump’ Stalwarts Try to Focus on Policy, Not the Man

 Muslim Americans Speak of Escalating Worry

650 Harvard Business School Women Assail Bannon (Trump’s pick for chief strategist)

 Conflicts and Nepotism Under Trump?

(Trump) The Man Who Would be King

Oh, No! Trump’s Calling

Daughter (of Trump)’s Presence at Meeting Poses Questions

An Anti-Muslim Proposal

As the The Nieman Lab, a respected media analysis organization, wrote recently:
 
“…will the increased clarity about the divides in this country encourage a more targeted product for affluent, coastal, progressive audiences? And will reporters and editors at these outlets — who, it is fair to assume, did not vote for Trump in large numbers — begin to see themselves as more explicitly oppositional?” 
Based on the New York Times, the answer is yes.

 

 

 

 

 

 

The City Club of Portland: Still in its Blue Bubble

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Hundreds gathered at a City Club of Portland Friday Forum on Friday, Nov. 11 to commiserate on the results of the Nov. 8 election.

“Elections 2016: What Just Happened?” was the topic. After an hour of dialogue, it was clear that what didn’t happen in Portland was a new understanding of why vast areas of middle America and rural areas of Oregon rejected liberal dogma and the Democratic Party.

Instead, the discussion swarmed with complaints of racism, misogeny, Islamaphobia and xenophobia by Donald Trump and his supporters.

The panel moderator was Sarah Mirk, online editor of ‪@BitchMedia and host of feminist podcast, Popaganda Backtalk. Her perspective was revealed the night of the election when she tweeted, “Should have brought anti-nausea meds to watch the election results.

The panel included: Jesse Beason, Director of Color PAC; Amy Herzfeld-Copple, co-executive director of Basic Rights Oregon, and; Julie Rabadi, chair of Young Republicans of Oregon.

“So many of us are still reeling today in shock and despair,” Mirk observed in her opening remarks. “No question this election has left us scared, stunned and angry,” Herzfeld-Copple added. “Many of us are grieving.”

Studies showed that Trump supporters were “much higher on the racial resentment score,” Beason said. This was “the first election I can remember where someone running on a racist and misogynist platform wins. Either voters themselves have racist proclivities, or it just didn’t matter enough that their presidential nominee did, for them not to vote for him.”

“…the ugliness and targeting of marginal communities” won’t stop until Americans “who perceive themselves as losing power get to less than a majority,” opined Herzfeld-Copple.

What the panel didn’t talk about

What the panel didn’t talk about was this map of the U.S., showing how the Republicans swept most of middle America and then some:

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or this map showing Hillary Clinton’s loss of most of rural Oregon, including Lake County, where Donald Trump captured 79 percent of the votes for president:

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or the clear evidence that economically anxious blue collar voters, particularly whites, feel they’ve been forgotten, that America’s middle class is under seige, that many Americans were deeply offended by Hillary Clinton calling many of Trump’s supporters “deplorables” and “irredeemable.”

The Friday Forum panel didn’t talk about the fact that, in contrast to much of middle America, they and their City Club audience were largely higher income, educated, upwardly mobile professionals

What wasn’t discussed was that the Forum participants were largely liberal Oregonians living in a blue bubble. As Michael Moore said, “Unfortunately, you are living in a bubble that comes with an adjoining echo chamber…” and don’t understand the anger of Americans at “… all who wrecked their American Dream.”

What the Friday Forum, taking place in a liberal “Sanctuary City”, didn’t talk about was how much of America is struggling to deal with massive immigration, both legal and illegal, and changes to American culture. Beason even said, “…illegal immigration is actually not a significant issue here in America.”

Finally, what they didn’t talk enough about was the need to listen to and try to understand people not like themselves. “No one wants to hear an opposing viewpoint.,” said Young Republicans Chair Julie Rabadi. “No one wants to consider it, to understand why somebody else thinks a different way.”

Not a good sign.

 

A “Throw the Bums Out” Election? Not exactly.

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Despite all the current cultural and political turmoil, a lot less has changed with the election than you might think.

Nationally, after Tuesday’s election, despite Trump’s surprising win, Congressional delegations in most states in January will look pretty much almost exactly like they do now.

Similarly, in Oregon, despite the crushing defeat of Measure 97, backed by unions and Democrats, and Republican Dennis Richardson’s success in the Secretary of State race, the make-up of the next state Legislature will hardly change.

At the national level, races were competitive on Tuesday in only 40 of the 435 seats in the House, according to the non-partisan Cook Political Report. Many seats were so safe for one party or the other that there was only one candidate.

Some of that may be due to skillful gerrymandering of congressional districts, but it may also be due to the increasing tendency of people of a like mind congregating in the same geographies, the birds of a feather flock together trend.

Americans may say they prefer living in diverse communities, but the Pew Research Center says people don’t practice what they preach.

“Americans are increasingly sorted into think-alike communities that reflect not only their politics but their demographics,” Pew said in a January 2016 report.

That’s certainly true of Oregon.

The Republican Legislative Campaign Committee (RLCC), a state-oriented national organization that seeks to elect Republicans to state legislatures, identified the Oregon State Senate and House of Representatives as targets in the 2016 elections. You’d never know it.

Senate

A total of 16 seats out of the 30 in the State Senate were up for election in 2016. Of the 16 seats, Democrats fielded unopposed candidates in five and Republicans fielded unopposed candidates in two. In other words, voters really had no choice in almost half the seats.

Meanwhile, 4 incumbents—one Republican and three Democrats—didn’t run for re-election. Only one of those seats had competition between a Democrat and a Republican in the general election.

That meant there were only 9 Senate seats where there was competition between Republican and Democratic candidates. Incumbents won seven of those races. The other 2 seats were open races. In one case, Republican Senator Doug Whitsett decided unexpectedly to leave politics. In the other case, Democrat Senator Alan Bates died.

According to Ballotpedia, incumbents almost always win re-election in state legislative elections. Since 1972, except for one year, the win rate for incumbents hasn’t gone below 90 percent.

House

 All 60 seats in the Oregon House were up for election in 2016. Democrats fielded candidates unopposed by Republicans in one district and Republicans fielded candidates unopposed by Democrats in five districts. So voters really had no Republican vs. Democrat choice in 20 percent of the seats.

That meant only 24 House races involved competition between Republican and Democratic candidates. Incumbents who ran won every single one of their races. In the seven districts where no incumbent ran, the winner was from the same party in every case. No revolution there.

———

What does all this mean? In Oregon, there will be some new faces, but the ideological split will likely remain pretty much unchanged. Maybe that the more things change, the more they stay the same.

Democrats will still control both chambers of the Oregon Legislature. However, they lost their chance to pick up an extra seat in the House to secure the three-fifths majority necessary to potentially pass bills to raise taxes without Republican support.

With the defeat of Measure 97, that hobbles the Democrats’ ability to go it alone on taxation alternatives.

As Martha Stewart would say, that’s a good thing.

 

Brad Avakian and his party are worried

With polls showing Republican Dennis Richardson leading Democrat Brad Avakian in the Oregon Secretary of State race, it looks like Avakian’s supporters are worried.

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Why isn’t this man smiling?

Just in the first three days of this month they pumped $398,915 into his campaign, according to state filings.

Although union members account for just 14.8 percent of wage and salary workers in Oregon, they play a big role in Avakian’s campaign. Union donations in the first three days of November included:

  • The NEA Fund for Children and Public Education – $50,000
  • AFSCME – $30,000
  • Local 48 Electricians PAC (4572) – $15,000
  • American Federation of Teachers-Oregon Candidate PAC (113) – $10,000
  • Ironworkers Political Action League Muti Candidate Committee – $5,000
  • Our Oregon – $5,000
  • Oregon AFSCME Council 75 – $4,000

Some donors to other Democratic candidates may be surprised to learn that another significant source of recent donations to Avakian is the campaign committees of fellow Democratic candidates. In a move that should be prohibited, those committees simply took contributions to them and, in effect, passed them on to Avakian.

These donors include:

  • Friends of Tobias Read – $5,000
  • Sara Gelser for State Senate (4680) – $1,000
  • Blumenauer for Congress – $2,000
  • Friends of Mark Hass (11487) – $1,000
  • Rosenbaum for Senate (Diane) (1430) – $1,000
  • Friends of Lee Beyer (14049) – $5,000
  • Friends of Tina Kotek (4792) – $5,000
  • Reardon for Oregon (15621) – $3,000
  • Kurt Schrader for Congress – $5,000
  • Elect Ellen Rosenblum for Attorney General (15406) – $5,000
  • Friends of Jeff Barker (4270) – $2,000
  • Friends of Jennifer Williamson (15145) – $2,500

Other large contributors to Avakian’s campaign in early November included the Cow Creek Band of Umpqua Tribe of Indians ($10,000) , the Oregon Health Care Association PAC (275), $5,000) , Cain Petroleum ($5,000) and James D. Fuiten, President of Metro West Ambulance ($5,000).

These recent contributions brought Avakian’s campaign committee total to $2,216,482.79 as of Nov. 3, 2016, substantially more than the $1,490,837.52 raised by Richardson, as of Nov. 4.

We’ll see whether all this loot can pull Avakian ahead.

 

Is Brad Avakian running for Secretary of State or Director or Public Health?

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One of Brad Avakian’s more ubiquitous TV ads emphasizes how he will “ensure a woman can make personal medical decisions about her pregnancy.”

And Planned Parenthood says reproductive health care in Oregon depends on voting for Brad Avakian. “Your reproductive health care is on the Oregon ballot,” says an article by Mary Nolan, executive director for Planned Parenthood PAC of Oregon, on Blue Oregon, a progressive online news and commentary site. Nolan quotes Avakian saying, “As a civil rights attorney, legislator and now Labor Commissioner, I know access to safe and affordable abortion service is a fundamental civil right.”

Planned Parenthood PAC has also made a $7500 contribution to Avakian’s campaign. If I were a contributor to Planned Parenthood, I’d ask for my money back.

 After all, where is protecting reproductive health care listed among the duties of Oregon’s Secretary of State?

Numerous studies have shown that large numbers of voters don’t know which officials are responsible for which issues, a circumstance that makes it hard to hold them accountable for their performance.

All that cluelessness could work to Avakian’s advantage.  In a classic example of misdirection, instead of emphasizing his fit for the Secretary of State job, he’s running as a champion of liberal causes.

Don’t fall for it.