A town meeting was held five short days after the announcement that the third enterprise zone agreement had been agreed upon with Google. Representatives from the school district, fire department, port authority, as well as many citizen taxpayers, were in attendance.
Most people believed five days was not enough time to digest such a complicated agreement. After all, it had taken nine months to conclude negotiations. A resident taxpayer stood up and requested a “show of hands” from those who thought five days was too short.
That request was summarily denied by Mr. Lawrence who said, (paraphrased) “We are not going to do that here.” Not one other elected official stood up and voiced his/her opinion or opposition to Mr. Lawrence’s decree.
It was a telling and remarkable moment. Evidently, they did not care what the average citizen thought and that says volumes about leadership.
At a county commission meeting two days after the town meeting, Scott Hege got emotional about his attempts to get more time for public discussion from Google. Google evidently denied his overtures. But it was not Google’s “call,” it was the negotiating team’s “call.”
Our negotiators should have informed Google that they were taking more days for public disclosure of the agreement — regardless.
Besides Google was probably still negotiating with other entities regarding agreement three. From the very beginning, time should have been built into a public disclosure forum.
Hege’s headline on his guest column in the Chronicle said, “Looking forward to Wasco County’s future with Google.” Let’s examine the “future” from the beginning: Agreement one in 2003 when Google was valued at $24 billion. Every agreement signed, so far, is a 15-year agreement.
The first agreement called for a one-time payment of $280,000 and yearly fee payments of $250,000. Those yearly fee payments were parceled: The county received a portion, the city an equal portion, and the college a smaller portion. Actual taxes (land only) ranged from $75,000 to $96,000. It was a failed monetary result for Wasco County.
On Aug. 24, 2013, enterprise zone agreement two was signed. Google was now a $250 billion company, 10 times more valuable than in 2003. Agreement two called for a one time signing payment of $1.2 million, which was only five times as great as the 2003 agreement. And the yearly fee payments of $800,000 were only 3.2 times as great as the 2003 agreement. Those fee payments were also parceled to the county, city, and the school district. Actual taxes remained the same because the third building was located on the same property as agreement one. Agreement two was also a failed negotiation by the county negotiators.
At the conclusion of negotiations on agreement three for property near Taylor Lakes, Google’s market capital value was $450 billion.
In two short years, Google was now worth $200 billion more (18 times) than when agreement one was signed. Agreement three came with a signing payment of $1.42 million. Using the agreement one signing bonus of $250 million in 2003 as a base line and Google’s market capital value of $450 billion, one can say that signing bonus should have been $4.5 million. Obviously, $1.42 million is far short of $4.5 million.
If Google’s business success continues on this current trajectory, by the time agreement three is at its term in 2033, Google will be close to $1 trillion. Conservatively, that is approximately 35 times more valuable than when agreement one was signed.
According to Mr. Lawrence’s figures, Google will make fee payments, on average and a minimum of, $1.76 million per year for 15 years on agreement three. Those payments are scheduled to begin in 2018.
Hege has been quoted as saying the new building will be a $1 billion investment. As yet, no discussion of actual property taxes.
If these figures are accurate, then agreement three is a much better result for Wasco County than agreement one or agreement two. But all the agreements are still subject to extensions granted by the state of Oregon.
However, according to a document prepared by the former Wasco County tax assessor, from the year 2007-2008 to tax year 2014-2015, the total taxes abated for Google was $106,951,046.55. Google, for that same time period, paid $745,908.55.
This is only one way to look at Hege’s forward look to Wasco County’s future with Google. By this measure Google has gained financial stability for at least 15 years on each agreement and, with “extensions,” much longer, for a “special case” called Google, at the expense of normal taxpayers. For what?
At the end of the day, when confronted with an issue that begs explanation, ordinary taxpayers ask, “What can we do?” when a simple “show of hands” is denied.
— Mike Bertrand resides in The Dalles and is a citizen activist who has opposed giving Google property tax breaks since the company began negotiating deals with the city and county in 2003.
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