Worldwide to raise roof - tax abatement gets unanimous decision

Here is the proposed site for a future housing manufacturing plant in The Port of The Dalles., 3855 River Road. Worldwide Structures Company has received approval for a five-year-tax abatement in exchange for creating some 50 jobs at above county average wages.

By Tom Peterson

Managers of Worldwide Structures Property Company told The Dalles City Councilors on Monday that they want to locate an affordable housing manufacturing plant in The Port because of its close proximity to Native American Tribes in the Pacific Northwest.

Worldwide’s Craig Novak said the plant would both construct trusses as well as assemble housing kits for shipping at the proposed 35,000-square-foot facility at 3855 River Road. Novak compared it to Ikea in the way that it will create affordable housing kits for shipment. Worldwide hopes to sell them locally as well as regionally for homes or even school rooms, Novak said, pointing out the high efficiency of the buildings will be inexpensive to heat and cool.

He said they intended to serve the high number of of Native American Tribes on the Olympic Peninsula, as well as Spokane and Colville Tribes, while regionally delivering housing from Montana to San Diego.

City Councilors unanimously approved an extended enterprise zone for Worldwide Structures Property  Company LLC at its Monday, July 27, meeting. In exchange for the abatement, the company is required to pay around $53,000 in wages and benefits per employee in the first three years. And in the fourth and fifth year of the abatement they must meet or exceed the Wasco County average wage, which currently stands at $40,678, exclusive of benefits. The business is expected to create some 50 jobs.

If at any point the company did not meet those benchmarks, the tax break could be withdrawn, said Matthew Klebes, enterprise zone manager.

The company is required to follow the standard planning process, submitting preliminary and final plats for approval to abide by land-use laws and meet all conditions set upon them by the three entities that have approved the abatement - Wasco County, The City and The Port of The Dalles.

Novak said they would use The Dalles as a first source for hiring and also noted they are hoping to employ Native Americans and Veterans.

BACKGROUND INFORMATION:

Enterprise Zones in the State of Oregon exempt eligible businesses from local property taxes on new investments for a specified amount of time. Businesses commit to creating new jobs and, dependent on the length of abatement, commit to certain wage and compensation thresholds as well as other local requirements.

Wasco County, City of The Dalles, and Port of The Dalles sponsored the Wasco County Joint Enterprise Zone in 2018. On June 12, 2020 Worldwide Structures Property Company LLC submitted a completed application requesting an extended abatement option for a total of 5 years. They intend to build a new 35,000 square feet facility located at 3855 River Road, The Dalles, OR 97058. The company intends to use the facility to modify building materials, assemble all components of a completed home and some commercial structures, and ship the building to site.

Carrie Pipinich and Matthew Klebes (Zone Managers) along with Jill Amery, Tax Assessor met with representatives of the company on July 1, 2020 to review the provisions of an enterprise zone agreement and answer any questions. A summary of that meeting is included in your packet.

The request for an extended abatement (5 years) requires an agreement approved by the Zone sponsors. This agreement sets the wage and compensation thresholds the company must meet in order to qualify for the 4th and 5th years of abatement. Specifically, the applicant’s average employee compensation throughout the 5 year abatement must be 130% or higher than the County’s average annual wage AND that the applicant’s average wage must be 100% or higher than the County’s average wage in the 4th and 5th year.

Following precedent, it also includes a provision where the company will pay the sponsors a community service fee computed as a percentage of their tax savings (50% in the 4th year and 75% in the 5th year) as well as a, “sweat equity” option the applicant could pursue with zone sponsor approval.

Staff has presented this item to the Wasco County Commission with unanimous approval and will present to the City of The Dalles Council next week.

Also included in the packet:

Enterprise Zone Pre-Authorization Consultation Summary

Worldwide Structures Property Company, LLC July 1, 2020

The pre-authorization checklist was reviewed and is attached to this consultation summary. In attendance were Matthew Klebes and Carrie Pipinich Enterprise Zone Managers, Jill Amery Tax Assessor, and Chuck Nuzum, Doug Kirchofer, Kyle House, and Rick Novak from Worldwide Structures. Worldwide Structures is a foreign limited liability company registered in the State of Delaware.

• Derek D. Simmons of Roseburg is the registered agent for the business, according to the Oregon Secretary of State business registry. In addition,  Worldwide managers, besides the ones listed above, included Craig Novak of Carmel, Calif., and Rurick Novak of Monterey, Calif. - Tom Peterson

Worldwide Structures intends to build a facility located at 3855 River Road, The Dalles, OR 97058; tax lot: 2N 13E 28 900. The initial facility will be approximately 35,000 square feet with possible expansions. It will use equipment to modify some building materials, assemble all components of a completed home and some commercial structures, and ship the building to site. There will be examples of products on site along with a sales office.

On June 12, 2020, Worldwide Structures Property Company LLC submitted a completed Oregon Enterprise Zone Authorization Application for an extended abatement of 5 years. The developer anticipates an investment of 4 million dollars and the estimated total number of new employees to be hired for the development is at least 50. This development may also utilize the Opportunity Zone.

Applicant is aware that with the development set for completion in early 2020 the first year of the abatement will be claimed in 2021 and continuing for the next 5 years if requirements are met. Applicant is also aware of the 130% annual compensation requirement and has affirmed that they will be able to meet this requirement. Applicant is also aware of the 100% annual wage requirement and affirmed that they will be able to meet this requirement.

For the Extended abatement, in years 4 and 5, the applicant is agreeable to the, “Tax Savings and Cash Contribution” table detailed in Resolution No. 17-026 and will submit a cash contribution accordingly. Applicant expressed interest in possibly amending the cash contribution agreement if a community in-kind partnership of comparable value can be established and agreed to by the City of The Dalles and Wasco County.

Authorization Approval will be signed pending the approval of an extended abatement agreement from the City of The Dalles City Council, Port of The Dalles Commission, and Wasco County Board of Commissioners.

- Matthew B. Klebes, Enterprise Zone Manager

Here is the proposed location for Worldwide Structures Company’s housing manufacturing plant. Worldwide’s Craig Novak said the majority of materials for housing will come from Oregon with just a few coming from California. In addition to assembling housing kits at the site, employees will also construct trusses.