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SOURCE: Oregon Public Broadcasting
Nike Expansion Could Bode Well for Manufacturing In Oregon
Kristen Fodel Vencil, Oregon Public Broadcasting
December 10, 2012
Governor John Kitzhaber says that if Nike
gets the Oregon tax guarantee it's looking for, it would hire as many
as 12,000 new workers by 2020. As Kristian Foden-Vencil reports,
some financial analysts think a Nike expansion could spell good news
for the nation's manufacturing sector.
Kitzhaber says the $440 million expansion project would employ about
2,900 construction workers. And by 2020, it could have an
economic impact of $2 billion a year.
Independent investment advisor Bill Parish tracks Nike stock and says it's one more indicator that the company is doing well.
"I mean I hadn't heard the specific
plans, but it's no surprise given Nike's growth," Parish says.
"Everyone seems to want to think that Nike will slow down but they just
don't. They keep going."
Republican Leader Supports Governor's Nike Plan
Governor John Kitzhaber is calling the legislature into special session
Friday. He wants legislators to take up a plan to assure companies the
state won't raise their taxes once they expand operations. The plan is
specifically designed to reassure Nike, as the company looks at a major
expansion in Beaverton.
"Essentially what we're proposing is simply providing business with
certainty that when they make a major investment in job creation and in
capital expenditures, the current method of business income taxation
can be relied on for a certain period of time," Kitzhaber said.
The Democratic governor's proposal would come before the current
Legislature, where the House is divided evenly between Democrats and
Republicans. House Co-speaker Bruce Hanna is a Republican from
Roseburg. He told OPB's Think Out Loud he supports the governor's plan.
"We've been trying to find ways to come together on a bipartisan basis
to do the right thing to build economic development," Hanna said. "This
to me looks like an opportunity to not only say we're willing to act
and act immediately to keep one of Oregon's premiere companies here,
but also we're also willing to say if you're willing to come here's
something to consider."
He expects the company will bring in new designers, graphic artists and
apparel experts. But he says Nike might also be thinking of doing some
manufacturing here. "The thing about Nike is they're always a leading
firm when it comes to major trends. And one of the trends that everyone
is expecting is that there would be more manufacturing."
Apple CEO Tim Cook has announced that his company will move production
of one of its existing lines of Mac computers from China to the United
States next year. But Parish says he's not sure what form any expansion
of manufacturing by Nike might take.
"Maybe there would be some type of assembly or whatever," Parish says.
"And it makes a lot of sense for a lot of economic reasons. Again, I
haven't heard that but it'd be really smart for Nike."
Parish says he has no idea where Nike would expand, whether it would be
at it's current location near Beaverton, or elsewhere. But he
thinks the company won't go too far from Portland International
Airport. "They're all about logistics. Shoes aren't that big or heavy.
I mean, one of their great strengths that people forget is: warehousing
technology and logistics."
Kitzhaber's proposal is that any company that commits to creating a
minimum of 500 jobs and investing $150 million over a five year period
should be able to know what taxes it'll face over an agreed upon
period. But he noted that Oregon needs to move quickly, or it
might face competition for Nike.
"The company is growing rapidly, they have to expand somewhere and they
have to do it soon," Kitzhaber says. "And the fact is they're being
heavily courted by other states and other locations. But they're
prepared to sign an agreement now to expand here in Oregon."
Governor Kitzhaber says Nike's employment in Oregon has increased 60
percent since 2007. Jobs with Nike pay an average wage of more
than $100,000 a year.
"We support this proposed legislation as a way to help us continue to
grow in Oregon," said Don Blair, Chief Financial Officer for Nike.
Parish & Company
10260 SW Greenburg Rd., Suite 400
Portland, OR 97223
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