After 15 years of cuts, should governments subsidize private developer?Beware businessmen seeking tax breaks. That is a useful guide for any local government, whether it is Washington County with Intel at its door or Clatsop County with Dr. Sonny Park at its door.
Credible economic research demonstrates that the link between taxation and business decisions to locate is tenuous. There are highly celebrated cases such as when United Air Lines went shopping for tax breaks elsewhere following its decision to leave Seattle. But by and large, businesses aren't making taxation-based decisions on relocation.
Using an Oregon law, Dr. Park is shopping for a tax break with Clatsop County government. If county commissioners give Dr. Park the green light, he may approach every taxing distinct within the county for individual property tax breaks.
Two things are worth noting in the Park case. First of all, Dr. Park has made a success of his Columbia Pacific Medical building, and he did so without tax breaks. Thus it is curious that Park says that he won't be able to obtain loans for a new building without property tax exemptions.
The tax break that Park seeks was promoted by former state Sen. Joan Dukes and former county commissioner George Kiepke. It provides property tax exemptions for up to three years for newly built medical centers serving communities at least 30 minutes travel time from a large city.
As they ponder whether to give Dr. Park a tax break, county commissioners should remember that Dr. Park is a private businessman, playing in the marketplace and winning. He is an entrepreneur who didn't need help the first time, even though he went to Salem seeking it. Meanwhile, the urgent rural health care need is a better Medicare reimbursement formula for hospitals such as Columbia Memorial.
The kind of tax relief that Intel seeks can correctly be called corporate welfare, or in the spirit of the Mafia one might call it protection money. Dr. Park's gambit is not in that league. But his request raises the same question. It doesn't seem like Park really needs financial help from tax districts that have trimmed services to taxpayers over the past 15 years to stay afloat.