The Hillsboro Herald has written over 40 articles in the past five years regarding Intel Corporation’s financial woes and the expansion of data centers, as well as their ongoing impact on our valley. Behind all of this push is the need for revenue fueled by Hillsboro’s never-ending growth. This mindset of constant development has always existed in the Hub City, but it has never been as aggressive as it has been in the last decade.
With revenues from semiconductor and tech firms drying up, the City management and economic development team rezoned hundreds of acres of once-verdant farmland to industrial use, marking the end of an era. Data Centers started quietly, but someone knew that our tech growth had stalled and that Intel was in trouble. Meetings took place in private rooms. Real estate deals were made, and commitments for power and sewer were secured. Stormwater and other utilities were made while the citizens went about their business.
Unknowing sellers and brokers transacted on land for $45,000 to $250,000 per acre in the last few years, only to find out later that zoning and the hidden existence of trans-Pacific fiber data cables would allow that same land to sell for over $1 million per acre just months later.
New giants have risen on the historic Tualatin Plains in North Hillsboro in the very shadow of Intel’s Ronler Acres Fab. One handing the baton to the other as the next big thing.
Going Deeper-The Real Cost of Oregon’s Tax Giveaways-
Let’s take a look at Oregon today and the two significant tax incentives that have brought both tech firms and data centers to our world.
Under SIP agreements, Intel receives partial-to-full property tax exemptions on machinery and equipment, which are essential in semiconductor manufacturing and become obsolete quickly. The 2014 SIP allows up to $100 billion in investment over 30 years, with Intel paying only for land and buildings, while machinery is largely exempt. This delivers hundreds of Millions in property tax waivers, which deny revenue to our schools and shift the burden to residential taxpayers and the school district. The SIPS program has been openly debated, with various economic estimates suggesting that the giveaways were worthwhile due to the economic multiplier effect; however, proof is scarce.
Is it possible that the State of Oregon used the people of Hillsboro as a host for Intel, took the billions in income tax revenues for their use outside of Hillsboro, and left us citizens with a massive burden? I say most definitely “Yes”.
Now that Intel is falling apart, Data Centers have taken center stage. So, why did Hillsboro, Washington County, and the State of Oregon hand out blanket 5-year property tax waivers to every single data center that appeared via the Enterprise Zone?
The answer lies in a flawed political and economic playbook. A new report from Good Jobs First reveals that Oregon schools have lost more than $1.2 billion in funding due to Enterprise Zone and SIP tax breaks—money that should have gone to classrooms, not server farms.
“School districts in Oregon are losing over $1.2 billion in revenue due to Enterprise Zone and SIP property tax breaks,” wrote researcher Anya Gizis. “That money could otherwise support teacher hiring, school upgrades, and student services.”
The Cost of Tax Breaks on Oregon’s Public Schools
Here is a table from the article that shows the massive losses to our schools and who has been hit the hardest- for those in Hillsboro, this is all just too much to accept. Shown below are the impacts to schools when considering lost revenues resulting from the Strategic Investment Program (SIPS) and the Enterprise Zone rules, which allow a 5-year property tax waiver. Between these two programs, Hillsboro Schools have gone without and as a result are suffering big time. At this point, only 34% of our students meet academic guideposts, and our kids are finishing in the middle or below for Statewide testing. The Richest City in the State —and we have fallen as these companies have arisen—what about this do we not understand?
“Biggest Losers
In 2024, five school districts lost more than $10 million in a single year. Six school districts had annual losses of more than $1,000 per student.
Table 1: Largest Tax Abatement Losses by School District, 2024
| School District | Total Tax Abatement Loss | Per Pupil Loss |
| Hillsboro SD 1J | $ 143,476,000 | $ 7,648 |
| Crook County SD | $ 29,004,208 | $ 8,576 |
| Morrow SD 1 | $ 23,064,808 | $ 10,380 |
| Hermiston SD 8 | $ 16,671,168 | $ 3,076 |
| Portland SD 1J | $ 14,062,000 | $ 319 |
| North Wasco County SD 21 | $ 7,869,994 | $ 2,764 |
| North Clackamas SD 12 | $ 4,064,759 | $ 240 |
| Eugene SD 4J | $ 2,663,801 | $ 164 |
| Gresham-Barlow SD 10J | $ 2,158,910 | $ 190 |
| Riverdale SD 51J | $ 1,363,306 | $ 2,417 |
Hillsboro School District has one of the largest school district tax abatement losses in the United States. It is home to Intel, which received a tax abatement package estimated to be worth more than $2 billion in 2024.[2]
Just last year, the school district had to reduce spending by decreasing custodial and counseling staff, cutting mental health services, and combining classrooms, along with raising local taxes.[3] Since 2017, Hillsboro School District has lost more than $750 million in revenue because of the Strategic Investment Program award to Intel.[4] At Hillsboro School District, a plurality of students are Hispanic (41%).”
Source – https://goodjobsfirst.org/the-cost-of-tax-breaks-on-oregons-public-schools/
The Rise Of Enterprise Zone & SIP Giveaway And The Fall of Hillsboro Schools
In Hillsboro, the damage is intensely local. Our schools scramble to pass levies while Amazon, Intel, and others enjoy tax-free land deals and taxpayer-funded infrastructure. The Enterprise Zone program—once intended to lure reluctant industry—has become a revolving door for giveaways to some of the wealthiest corporations in the world.
“Data centers on farmland get a free ride while our schools beg for basic improvements.” — Hillsboro Herald, 2023
“The argument that data centers wouldn’t come without incentives is a lie. They came here for the fiber, the power, and the land. The Enterprise Zone is just gravy.” — Dirk Knudsen, Editor
Enterprise Zone Tax Breaks vs. School Revenue
Here is a look at the Property Tax giveaways that have been given out to Data Centers in Hillsboro over time. These numbers are researched carefully, but with calls to the Washington County Tax Assessor going unreturned, they need to be refined. It is probable that the actual numbers are much higher.
Enterprise Zone Tax Breaks vs. Data Center Growth in Hillsboro (2015–2024)
Back to the Report – What Can Oregon Communities Do To Protect Our Schools?
Good Jobs First presented some compelling arguments in their report, along with strong conclusions that align with the conclusions we have made here at the Herald.
Conclusions From the Report – https://goodjobsfirst.org/the-cost-of-tax-breaks-on-oregons-public-schools/
Recommendation #1: Shield School Funding from Abatements
We recommend that every school district’s share of the property tax be 100% shielded
from abatements. No state or local agency, board, municipal or county government, or any
other political sub-division should be allowed to abate school-assigned tax
revenues. Florida and Maryland both shield school revenues from abatements, and New
York State has proposed legislation to shield schools as well.13Fallback Recommendation #2: Give School Districts Control of Their Share in Tax Abatement
DecisionsShort of taking the school share of the property tax off the table altogether, school boards
should be given control of their share of property tax revenue. Given the large effect these
tax abatement losses have on education funding, it is only equitable to give school boards
the right to decide whether to forego any revenue, or on which terms. The status quo
amounts to an “intergovernmental free lunch,” which is a recipe for over-spending and less
accountability. Giving school boards equal say in how their money is used is key to
protecting the districts’ financial stability and ensuring high education outcomes.Recommendation #3: Disqualify Data Centers for Tax Breaks
We recommend that Oregon specify data centers as ineligible for the Enterprise Zone Program,
or any other, tax exemptions. Cloud computing is a profitable, rapidly growing industry that
does not need any public financial support. Oregon’s low electricity rates and bountiful
water are already major site location advantages for server farms.
VOTE – What do you think?
Conclusion
We are watching a second wave of displacement—not of people, but of public wealth. These tax exemptions were never necessary. The tech industry came for Hillsboro’s assets—our cables, our power, our land. And we handed them the keys almost for free.
The result? Oregon’s schools are broken. Farmland is vanishing. Utility rates are rising. And our future is being built on a foundation of short-term deals and long-term debt.
If you are an educator, a parent, or a concerned citizen, we want to hear from you. Email us or leave a comment.
This story is yours as much as it is ours.
I love data centers. But then I bought Nvidia stock for pennies a share and I’m now very, very rich. Not bad for a Hilhi drop out. Everything changes …. always. Why cry about the future? We won’t be there anyway. One day they will tear down the data centers and build something else.
Well I am so glad for you – Were you a Hillsboro School product or more like Sunset? Since your so very rich, does it change youe perspective towards those doing without or struggling to get their kids through school? Or is it more like “screw ’em”, I got mine? Asking for a friend-
How much tax money per student do these schools get now ? And what are they spending it on, more administrative type people than students? The property taxes that the county gets from Intel and the data centers is I’m sure a lot more than when it was farm land few dollars per acre. Throwing more money at a system that has no accountability sounds like just another stupid idea. Until our government can do an audit of where they are spending the money we give them now why should we give them more?
Hi Matt-
I understand your sentiment. And you are right= we need to be honest that we spend way too much on admins and non-teaching staff. That said, these TAX revenues or the lack of them did not create that situation. We need the revenues because they are owed, and we should not have let these DATA CENTERS have a free pass. On the other hand, we do need to control where the money goes once it flows in- and it sure and the hell needs to land in those classrooms and with the actual teachers and kids. So your half right – but to say that we should not get the money that is owed because it will be wasted, that is not the answer at all.
Yeah, struggling is hard. I did it. Working my first job as a dishwasher at the Greenwood Inn (making $1.60 a hour) taught me more than I ever learned at Hilhi (never attended Sunset). I could see the dead end in front of me and instead of accepting it, I took action to change course and create a better future. I started my own business. Those hypothetical people you are so worried about, it’s up to them to create their own future also. It’s sure not my responsibility! That’s the ethos that has turned Portland into a vagrant wasteland. I’m sorry I’ve had a successful life and that rubs you the wrong way. It would so much better if I was a crazy stung out drug addled vagrant on the streets… then you could shower me with ‘empathy’.
This information is astounding. People like Willey (who double-dipped in City and County) and Harrington and their predecessors are the politicians who made all this possible after the state opened the door to it all. They are the “progress” promoters (and I hope they’re a dying breed). Build, build, build. More, more, more. And they were responding, as politicians do, to the even bigger boys — and justifying it all with jobs, jobs, jobs. Farmland? Schools? Don’t bother them with such small matters; there’s money to be made. And whoever thinks about that when s/he pays state and local taxes? We’re all paying a lot more than we needed to pay because of all the subsidies and abatements. How in the world do we fix this? It’s a big one. Thanks for reminding us.
Oscar- your always onpoint! I sense a community writer in our midst. How about it? I can sure use the help!
Dirk
The reason for the failure is the Democrat policies in Hillsboro. The schools did nothing to improve the education in the city. Hillsboro did nothing to attract businesses to replace Intel income.
There’s a distinct difference between Intel and datacenters. Intel employs a lot of people and a lot of additional people are employed by the companies who Intel uses to support their operations. There is a huge volume of data that strongly supports SIP for companies like Intel. Hillsboro and Oregon also would not be the places that they have become without Intel almost 40 years!
Datacenters employ almost no one and very little incremental employment by supporting companies. This is simple a waste of forgone tax dollars and I agree 100% in applying maximum property taxes to datacenters.
Good article!
Thanks, Chris. Yes they are seperate types of incentives. But because Intel has never paid much in the way of Property taxes, and brought tens of thousands of employees to live here, the real question is did those employees add more than the Billions that were waived. We will never know- and I have read all the data and remain unconvinced. At least the Data Centers will each pay Millions in property taxes long afer Intel is gone- and that is the City Manager’s dream. Less people, more reliable dollars.
The answer is, quite simply, yes.
Intel’s decades of presence in the area have led to countless new homes being built every decade that we wouldn’t have had demand for otherwise. Those new build houses actually pay their full property tax as they don’t have decades of prop 5 perpetually growing subsidies built in (until they’ve been here for years, of course).
Intel being here has easily led to the development of 10k houses/properties that wouldn’t have existed otherwise to be developed over the last few decades. Those houses, averaging 500k all bring in 6-10k per year in tax revenue to Washington County and it’s municipalities. So Intel’s own employees might represent 60 -100 million in real estate taxes per year that otherwise wouldn’t. Year over year, that alone is a pillar of our budgets.
Intel has been the largest private employer in the state more than once in the last 15 years. They pay well, even for their positions that do not require degrees. I think it’s fair to say they currently average out to about $100,000/year. So each one of those people is adding roughly $5k-6k/year in state income taxes, some of which goes to back into our county and municipalities.
These are napkin numbers and don’t consider the huge range of support and auxiliary contractors, some of whom are entirely based in Oregon and 100% in business thanks to Intel.
Intel has also singlehandedly sponsored substantial infrastructure development in our county, in terms of electrical grid investments, fiber interconnect, water extraction, distribution, and treatment, roads, you name it. What do you think the Hillsboro airport would look like without their biggest customer for the past decades?
I’m all for scrutinizing them and making sure they are upholding their end of any deals made with our governments. No corporation is above scrutiny by any means. But that doesn’t mean we should start kicking our gift horse in the mouth while they are already in danger of going to the glue factory.
No one is kicking them in the mouth. Those homes barely pay for the costs that they bring to the community. The county is tens of millions in the hole. We were fine without INTEL but few people remember what it was like. It was actually a much more livable and peaceful place to be. It is all about perspectives I suppose. Intel has been a huge money maker for the State- not for Hillsboro. When we had the Gain-Share money coming into Hillsboro that was different. That did help. As it is we do not have much net revenue from Team Blue. When one factors in the environmental risks, the traffic, housing crisis, and diplacement of so many existing residents and so much farmland, the arguments in favor fade even more. But they are here, we need them to succeed and be healthy, and we need them to be a good neighbor and pay their fair share.
Well done Dirk! Keep it up.
As a small businesses owner that has to pay the FULL amount of property taxes, this pisses me off to no end. I will be selling or closing and moving out of state, if I dont go out of business first. The local economy is in shambles right now.
Washington County is as corrupt as it gets and always has been. This isn’t unintended consequences or lack of foresight. It’s a well used playbook that is a mirror of the state’s tactics. What came first the data center or the enterprise zone? Living in a town like hillsboro for 30 yrs gets you some perspective. Rural, great curb appeal, ground zero for the tech explosion, and Money. Old and new. The county inspector that you needed to leave a bottle for if you wanted your inspection to go through. The drunk judge and his police buddies from back in the day that God only knows what the truth was and how much property became the County’s through forfeiture. How does some little backwater sewer council think they spend thousands on trips every year. Or a state agency can just continue to rack up contempt of court and millions in wrongful death and sexual assault lawsuits for decades and yet no DA ever makes a phone call for federal assistance. The plans are made the property and money changes hands the non profits are and llc’s are created and the politicians are assigned and then the laws are put on the books all nice and neat. Every once in a while someone is a sacrificial lamb and gets a $1000 fine from the ethics commission. There is no grand conspiracy it’s just how it’s done.
You lived it like me, and I can not say I see it much differently. Maybe I am the first to publicly call things out-
Intel has paid between $20 and $30 million dollars a year in Washington County property tax for at least the last 10 years. I know this because I did 5 minutes of research on the County tax assessors website.
Based on their evaluations, that is about 1/6th of what they should have paid to make them even with the assessed taxes and rates the rest of us pay.
There sure are a lot of narrow sighted and ignorant (purposefully?) people in these comments. Schools are already run on the thinnest of margins (I used to sit on budget committees). Most, if not all, districts have cut administrative overhead to the smallest portions they can – but many people do not understand the regulatory nightmare that schools must now navigate. The bureaucratic mess has only gotten worse, let alone cuts to federal school funding and programs.
Many of the comments have pointed to the near-sightedness of the city and county. This does extend to the schools as Dirk suggests, but also all of our community and infrastructure. These industries bring with them massive population surges to staff them. While this is a positive addition to our sense of community, the schools are stressed by the surge in population. While the community welcomes all, the massive weight of the population needed to staff these corporations has added stress to healthcare, schools, roads, fire, police, EMS, and on and on. It creates additional stresses like housing shortages, rent spikes, and private utility cost increases. There is a massive trickle-down effect from these large industries beyond just the horrific pressure it puts on schools. Commenting that it’s great that a tiny house now costs over $500,000 is obscene at best. Usually those comments are made by boomers who purchased a home and new car on an entry-level job 50 years ago. Or by someone who’s never known financial hardship. I guess there’s always the brain-rot folks that’ll believe anything they see or hear on certain “news” outlets.
Intel has often laid off employees only to hire new ones at lower pay – I’m not sure they’re feeling any sort of financial pinch as Dirk indicates. In fact, one could argue they are poised to do even better financially than ever before. To the person defending this company, how many years has there been work on highway 26? How about highway 217 – how’s that going? This side of Portland is one of the reasons the region is ranked 3rd in the country for worst traffic. How many other businesses must exist for the staff of Intel to reside in this community – and of those businesses, how many pay their people enough to afford a $500k starter home?
Any bootlicker in these comments condemning schools with less resources than my generation had just 20 years ago needs to visit a library or church for perspective. Corporations have one singular goal and human beings are not part of the equation, nor is any consideration from the state, county, or city. Anyone that brags about wealth over human beings unironically has obviously lost all sense of humanity.