HOUSE SPECIAL SESSION COMMITTEE ON

ECONOMIC GROWTH AND JOB DEVELOPMENT

 

September 6,2002†† Hearing Room 357

2:00pm††† Tapes7 Ė 8

 

MEMBERS PRESENT: ††††††††††† Rep. JeffKropf, Chair

Rep. Alan Brown

Rep. Elaine Hopson

Rep. Al King

Rep. Kathy Lowe

 

MEMBER EXCUSED:

Rep. Greg Smith

Rep. Tim Knopp

 

 

STAFF PRESENT:††††† ††††††††††† Ray Kelly, Administrator

Nancy Massee, Administrative Support

 

 

MEASURE/ISSUES HEARD:††††††††

††††††††††††††††††††††† ††††††††††††††††††††††† Informational Hearing

 

These minutes are in compliance with Senate and House Rules.Only text enclosed in quotation marks reports a speakerís exact words.For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 7, A

004

Chair Kropf

Opens meeting at 2:16 p.m.

014

Rep. Tom Butler

House District 60. Ontario, Oregon. Worked with group on ways to attract businesses to Oregon. The ideas of attracting venture capital, biotechnology and research firms to Oregon were discussed.Presents concept Small Communities Incentive Program (SCIP).

085

Rep. Butler

Continues explaining how experts in particular areas would get an income tax exemption for up to ten consecutive years in return for locating a business in Oregon.The groups referred to are to be proven venture capitalists with at least $100 million capital to invest in technology or bioscience.

150

Rep. King

Asks if income tax exempted is earned income only.

165

Rep. Butler

Responds income tax exclusion would be exclusive to the partner.Yes, only Oregon earned income would be exempt.

214

Rep. Hopson

Asks if income earned with the state of Oregon whether earned with the venture capital or other, would be exempt?

221

Rep. Butler

Explains how the exemption would be allowed.

255

Rep. Butler

Continues describing Legislative Counselís explanations regarding tax exemptions.Describes individuals who would qualify. The group would be quite small in number consisting of researchers, Ph.D.ís and M.D.ís.

365

Rep. Butler

After venture capitalists, the second group to attract would be qualified bio-scientists and companies not already in Oregon. Describes requirements for these people.Continues explaining how high tech industries have operated in Oregon trading employees.

TAPE 8,A

043

Rep. Butler

Summarizes how this tax exemption would benefit Oregon.

053

Rep. Hopson

Asks about the three groups of venture capitalists, individual Ph.Ds, M.D., and what else?Are the qualifiers for the economically distressed areas already in place?

061

Rep. Butler

Responds the qualified bio-science individuals and then the qualified high tech individuals. High tech is already here.We are trying to attract the bio-science field.

073

Rep. Butler

Describes some qualifiers. Counties that presently qualify are Sherman, Gilliam, Wheeler, and Lake. Describes some port districts.

113

Rep. King

Comments on bringing biotech industries to Oregon.Stresses importance of getting this business and the fact that it is a highly competitive field.

141

Rep. Butler

Continues describing qualified bio-science industry possibilities. Suggests there is great opportunity to change Oregonís goals in attracting business.†††

207

Chair Kropf

Asks for clarification on the groups that would be approached.

390

Rep. Butler

Clarifies.

TAPE 7,B

007

Rep. Butler

Describes needs of access to funds, access to personnel, and access to natural resources.

020

Rep. King

Discusses venture capitalists in California.Oregon only recently has attracted venture capitalists.Oregon could be a northwest partner toNew York venture capitalists, as an example. If Oregon got four or five venture capitalists Oregon would realize financial power.

055

Chair Kropf

Does this program pay for itself?Where does this fall economically?

067

Rep. Butler

Responds Oregon Economic and Community Development Department (OECDD) is already trying to attract new staff. The business community is trying to attract these companies and individuals. Explains how revenue would be gained.Cost for a biennium for the program would not be over $200,000.It would be revenue and expense neutral and no fiscal.OECDD would need authority to expend the money for the applications.A hundred new businesses in this category would bring billions to Oregonís economy.

087

Chair Kropf

Asks if Oregon can attract these people, should Oregon accept some short term lower revenues to create longer term, stable, economic diversity.

105

Rep. Butler

Answers he does not believe this program will reduce revenues in any way.These new businesses would be investing in property and offices in Oregon.†††

140

Chair Kropf

Supports this concept to attract venture capitalists and highly trained people to Oregonís business community.

144

Rep. Butler

Refers to Legislative Counsel and OECDD witnesses to testify.

149

Dexter Johnson

Legislative Counsel.Says this is a complicated bill that could not be drafted until possibly Monday.

152

Chair Kropf

Asks what complications there could be in drafting the bill.

168

Johnson`

Responds by discussing constitutional requirements of taxation. If a personal limitation is in the bill there could be problems. Discusses other drafting issues to meet requirements.

197

Rep. Butler

Introduces Ron Fox from OECDD.

210

Ron Fox

OECDD.Supports this concept and offers help.The concept is worth further discussion.

266

Rep. Butler

Thanks participants.

280

Chair

Asks Rep. Butler and Dexter Johnson to move forward on the draft.Adjourns meeting at 3:33 p.m.

 

Submitted by,††††††††††††††††††††††† Reviewed by,

 

 

Nancy Massee††††††††††††††††††††††† Ray Kelly

Committee Assistant††††††††††††††††††††††† Committee Administrator