The news about Intel is everywhere these days. As the semiconductor giant and Oregon’s largest employer struggles, our government officials hope to cash in on the CHIPS ACT and the billions available from the Federal government. Passed by President Biden in 2022, the CHIPS and Science Act will;
“$52.7 billion for American semiconductor research, development, manufacturing, and workforce development. This includes $39 billion in manufacturing incentives, including $2 billion for the legacy chips used in automobiles and defense systems, $13.2 billion in R&D and workforce development,and $500 million to provide for international information communications technology security and semiconductor supply chain activities. It also provides a 25 percent investment tax credit for capital expenses for manufacturing of semiconductors and related equipment. These incentives will secure domestic supply, create tens of thousands of good-paying, union construction jobs and thousands more high-skilled manufacturing jobs, and catalyze hundreds of billions more in private investment.”
That is a lot of Billions and a lot of jobs. The race is on across America to find pad-ready land that can bid for a place for all of this money to land. The Act calls for the expansion and creation of technology hubs that can quickly develop the facilities and human capital to work at them. Driving this Act was the fact exposed by COVID that we can not create chips for our own country, let alone the rest of the world, that will support our economy. National security is also at play here. In a world conflict or struggle, we could not easily have the computer chips to support our own defense needs. That and estimates that the US may only be able to create 15% of its needs drive this bill. These hubs should most definitely include locations in Oregon, a State that relies on Intel for a great deal of our State income tax revenue. If they were to leave for greener grass, it would be catastrophic.
The Bill has a provision for creating technology hubs across the country. This will include using existing hubs, like Hillsboro, Oregon, and others, to push growth and expansion and get computer chips flowing here are home in the US. Here is the verbiage from the Bill:
The CHIPS and Science Act authorizes $10 billion to invest in regional innovation and technology hubs across the country, bringing together state and local governments, institutes of higher education, labor unions, businesses, and community-based organizations to create regional partnerships to develop technology, innovation, and manufacturing sectors. These hubs will create jobs, spur regional economic development, and position communities throughout the country to lead in high-growth, high-wage sectors such as artificial intelligence, advanced manufacturing, and clean energy technology. It also authorizes a $1 billion RECOMPETE pilot program at the Department of Commerce’s Economic Development Administration (EDA) to alleviate persistent economic distress and support long-term comprehensive economic development and job creation in the most distressed communities.”
Let there be no doubt that everyone in Oregon is hot on this matter! Senators Widen and Bonamici, Governor Kotek and METRO and DLCD, Cities like Hillsboro, the Port of Portland, 1,000 Friends of Oregon, and anyone in the land use and governmental sector, are all on point. While housing and homelessness are grabbing the headlines, this is the big ticket item.
A year ago, the Hillsboro Herald wrote a story that asked the question, Is Intel Done With Oregon? This looked at the agreement that Intel made to commit to four massive fabs in Ohio on a 1,000-acre site. The message this sent was that Intel was no longer looking to Hillsboro and Oregon for major plants that employ thousands. Thousands read that story, and the feedback and information we had come forward was telling. Intel is fine with what they have in Oregon but growth is not on the horizon.
Retraction by the “Big I” is the talk fo the day. In 2022 the company announced big layoffs nationwide, and about 2,500 of those will be here in Oregon. Those layoffs have been manifesting themselves in recent months based on direct interactions we have had with employees of the company. Morale is low and the company seems to be doing more cost-cutting and less innovation. How that bodes for them and for Hillsboro and Oregon remains to be seen.
This past week Intel went public with the fact that the $700,000,000 R&D facility they announced last year at Jones Farm has been scrapped. This is another sign that the company is looking for a different wind to push its sails. The Herald covered that story as well.
Now on to the expansion news. Intel or not, our State and City is poised for a major expansion of the Industrial land base to make Tier 1 (pad-ready) sites available. The Oregon Semiconductor Readiness Task Force has been working hard for a year now. This year we will see the Oregon legislature bring forth policies for growth. Who gets it and where it goes are at the forefront, and many bills could be put forth soon. We expect the process to go outside of our excepted land use systems and include Urban Growth Boundary expansions like those used during the “Grand Bargain” that led to a massive expansion in Hillsboro in the Meek Road / Sewell Road area. That land is now mostly gone, being grabbed up by Data Centers and the likes of Amazon.
The Herald attended a land use forum at Ponzi Vineyards in December that featured all the major players giving their positions. Hillsboro has openly stated that they need 1,000 to 2,000 acres for industrial expansions and the semiconductor sector. While there will be much debate about where these large boundary expansions will go, one thing is clear. It is happening, and it will probably happen sooner than later.
See our coverage below:
The Herald staff has decades of land use and real estate experience. We have watched every major decision and land use action here, and we hear from landowners who are currently being approached and optioned. Hundreds of Millions of dollars will be made by those who are lucky enough to be rezoned during this process. Going from farmland to fully served industrial is a big deal. Values can rise by as much as much s 2,000%. So it is not hard to imagine the amount of influence that is used to manipulate the outcome. There will be winners and losers as a result of these moves, but there are only a few places the boundary can flex and still provide major public services. Hillsboro is also geographically constrained, and so any growth has to be in our Northern reaches.
The Hillsboro Herald is predicting that growth will land in one of these three areas. These maps are speculative and authored by the Hillsboro Herald- they are not official in any way:
Helvetia Area #1- 400 plus acres
Area # 1, we are calling the Helvetia Unit. This large block of land is located on US 26 on the South, Groveland Road on the West, West Union Road on the North, and Helvetia Road on the East. It would be a natural boundary expansion and would feature full services already on Helvetia Road. From a purely logical standpoint, these lands are a no-brainer. From a Political standpoint, the group SaveHelvetia.org will fight to retain the rural character of this area. Fear abounds that this growth would lead to the highly coveted Helvetia countryside folding into urban uses. This area has an existing boundary on two sides and could be developed quickly.
Meek-Scotch Church Area #2 – 930 acres
The red dashed line is the existing Hillsboro Urban Growth Boundary. This site is split into two sub-areas for our discussion purposes.
Meek Road-Scotch Church Sub Area A
This unit of land comprises about 400 acres on the East side of Jackson School Road, which was left out during the last Urban growth expansion. It should be a top priority to come in now as it was forced out of the last land expansion for a few reasons. The new Jackson Road rotary and the highly accessible Jackson Road off-ramp make this site a natural. The lands East (Jackson East) and South (VanRose property)are being readied for the next wave of industrial users. Having said that, the airport runway and flight paths seem to be eliminating VanRose from a major chip Fab, and the hotly contested Jackson East area rezoned dozens of lovely estates into Industrial, but that is too parcelized and hard to manage for a Fab. Area A on the above Map would easily be developable as a stand-alone location for a Fab. It would be perfectly suited from a site as it is level, served by roads, and could be reasonably served by water and sewer. This site should be at the very top of the pecking order.
Area B – Meek – Scotts Chruch Road Subarea-
Area B would add another 500 acres to the West of Jackson School Road. These lands could be served after Area A is served and would work well with the transportation and the rotary. The sites are fairly level and open. This would be a decide Westward expansion of the Urban Growth Boundary and will take the City down the road of annexing all the way to Glencoe. This would include the historical Scotch Church and, for many locals, maybe a bridge they are not willing to cross. Undoubtedly, the landowners there have already been in meetings with all appropriate government bodies and are lobbying hard for things to go that way. It would be an odd bump out in the boundary and should be a quid pro quo- Area A gets in, or these sites do not.
Together these lands can provide Hillsboro with almost 1,000 acres for semiconductor plants and have to be a top priority going forward.
Helvetia North Plains Expanded – Area #3
The big grab would be to take Area #1 and expand it West to the North Plains Urban Growth Boundary. This would create a 1,364-acre unit completely bounded by US 26 on the South and West Union Road on the North. Jackson Road would be on the West and Helvetia on the East. Two, not 1, freeway on/off ramps would provide direct access to such a site. All major utilities would be fairly easy to provide. This would be a big-time Campus site. If the State or Hillsboro obtained this land for the semi-conductor uses it would be the biggest site of the kind in the country. It would also fit nicely within the existing UGB of both Hillsboro and North Plains.
Going North may not be the popular choice but engineers and planners will argue this one is the easiest and makes the most sense. Have a look at the overlay we did using Google Earth and the Ronler Acres building sizes.
This shows us that 5 Fabs the size of Ronler Acres would fit here. Again, total speculation on our part, but very doable. Since no one openly wants to show these potentials or discuss things at this time, we will.
Conclusions: In our view, growth is coming again to greater Hillsboro. Will any of these lands come in? Maybe not. But based on what we know, what we hear, and that powerful individuals are optioning lands in these areas, we believe one or more of these scenarios will play out.
Have you been approached? Are you considering placing your property for sale or signing an option or consulting agreement? If so, you would be wise to pause and discuss it. Only through the prpo[er exchange of information can you be informed enough to make the right decisions. We have data, land comparables, and information we will gladly share with you so that the cards will be on the table. Many times these things happen in secret, and the land owner ends up finding out only too late that they could have done better.
We believe Hillsboro is well-positioned to lead this process forward. The staff at City Hall are particularly capable of this process, and if it is going to happen in Oregon, we believe a good deal of the growth needs to be here. Failure to provide adequate and in Hillsboro would be a huge missed opportunity. Companies like Intel, Apple, and Taiwan Semiconductor do not want to be in Gresham or Wilsonville. The Cluster we have here, as seen on the above map, is where they want to be. If we as a State are to gain these highly sought-after jobs and Billions in Federal funding, it has to happen here.
Best of luck to all involved in this next massive undertaking.