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This Resolution authorizes Prosper Portland to submit a designation of the Portland Enterprise Zone to be designated for Electronic Commerce (E-Commerce) for the newly re-authorized 2023 Portland Enterprise Zone (E-Zone) to the State of Oregon.  

This action requests that the Portland City Council (City) designate the Portland E-Zone to retain an E-Commerce overlay for 10 years and direct staff to submit a notification to the State of Oregon. The State of Oregon currently has three such E-Commerce designations available, one of which was comes from the termination of the East Portland E-Zone on June 30, 2023. Staff anticipates another Metro area jurisdiction will be applying for one of the three remaining overlays soon, leaving only two more E-Commerce designations to be claimed by E-Zone sponsors. 

In 1985, the Oregon State Legislature established a statutory structure for the E-Zone program that permits cities to establish zones where businesses that invest in economic expansion and the creation and retention of jobs can claim property tax abatements for a limited period (up to five years).  

In 1986, Portland City Council established the Portland E-Zone and authorized Prosper Portland as the City’s E-Zone Manager. Since then, in 1996 and in 2008, 2012, 2019, and 2023 Prosper Portland has requested, and City Council has approved submitting successful reauthorizations to the State of Oregon for the Portland and East Portland E-Zones.   

This action strongly aligns with the City’s 2023 Advance Portland’s Strategy in several ways as, it will positively impact the city’s ability to: i) Propel Inclusive Economic Growth & Innovation, ii) Connect Portlanders to High-Quality Jobs in Future-Ready Sectors, and iii) Promote Equitable Wealth Creation. Retaining an E-Commerce overlay will allow Prosper Portland to continue to implement powerful and effective tools to build an equitable economy.  

If approved, this action will allow the City of Portland to continue to use an E-Commerce designation that has existed in the East Portland E-Zone for 10 years and has encouraged commercial investment by electronic commerce companies that otherwise would be unable to use the program under statutory guidelines.  

Over the past 10 years, Prosper Portland has managed 12 different E-Zone projects that qualified under the E-Commerce designation. The 12 active companies have:  

• Invested $234,828,000 in the City of Portland; and 

• Created 727 new jobs. 

Over the past 10 years, Prosper Portland has managed 97 different E-Zone projects. Since the Great Recession in 2010, the program has seen significant increases in enrollment; currently, there are 45 active E-Zone participants, including 18 in the East Portland E-Zone (29 percent and 33 percent of which were small businesses, respectively). Since 2015, companies have: 

• Invested in capital or procured goods and services totaling $1,813,000,000 in the city of Portland ($940,000,000 in Portland E-Zone, $873,000,000 in East Portland E-Zone) 

• Created 3,600 new jobs in a 2021 snapshot (1,955 in Portland E-Zone, 1,645 in East Portland E-Zone) with 49% of employees identifying as people of color, a higher percentage than the 31% demographic in the general population in Portland;  

• Paid $30.16 per hour average wages and offered total compensation of $36.34 per hour ($31.98 per hour in Portland E-Zone, $28.00 per hour in East Portland E-Zone, in 2021 dollars); and 

• Collectively in both E-Zones provided $8,000,000 for local non-profits, businesses, and workers through Prosper Portland programs such as the Inclusive Business Resource Network, Economic Opportunity Program, NextGen, and others. 

In 2003, the Oregon State Legislature added provisions permitting local governments to establish local policies and written agreements imposing obligations on E-Zone companies to provide designated community benefits. Most recently, on September 13, 2017, the Prosper Portland Board through Resolution No. 7253 requested (and City Council ultimately adopted through Resolution No. 37321) amendments to the E-Zone policy that would increase requirements for wages/compensation, procurement plans, and institutionalizing additional public benefits through formal agreements between participating businesses and Prosper Portland. As such, the current E-Zone policy provides numerous community benefits through its innovative partnership and business practices, including: 

• Institutionalization of public benefits agreements as more companies agree to invest in business culture change activities that create opportunities for a diverse, locally grown workforce; 

• Job seekers from across the socioeconomic and demographic spectrum access quality employment opportunities; 

• Direct funding for programs such as the Inclusive Business Resource Network and Mercatus and a direct connection between businesses using the E-Zone program and businesses and entrepreneurs from historically disadvantaged communities; and 

• Infrastructure for new initiatives such as Portland Means Progress, which is mirroring efforts in the E-Zone to create new partnerships and pipelines for businesses owned by members of historically disadvantaged communities and business culture change with the end goal of creating more equitable and inclusive businesses in Portland.