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Are there limitations provided under the state statutes and rules regarding the establishment of additional local conditions? Yes. The Oregon Enterprise Zone statutes (ORS 285C. 150) includes language regarding additional conditions adopted by the zone sponsor. In summary, the conditions must be "reasonably related to the public purpose of providing employment opportunities." Examples include wages, benefits, job training and advancement opportunities. Additionally, the Oregon Administrative Rules (OAR 123-065-2500 through 123-065-2599) have established parameters that guide situations under which a zone sponsor imposes additional conditions on businesses that receive enterprise zone tax exemptions. In summary, the rules are intended to align additional local conditions with the job creation purpose of the state program. The rules clearly discourage major deviations from this purpose, and preclude changes to the basic state eligibility criteria that companies must meet. However, the rules do appear to allow some recapturing of the tax exemption benefit (up to one-third in the form of a payment to the sponsor) if there are reasonable standards for such recapture, and if the recaptured dollars are targeted towards the employment opportunities public purpose. The Committee's recommendation was made within the context of these limitations. Because the enterprise zone program is limited in its capacity to impact all of the City's sustainability goals, what are some of the other tools and incentives that could be considered to meet these goals? The Committee looked at options for including local sustainability measures and conditions in the local enterprise zone program. They concluded that the incorporation of such conditions within the enterprise zone program is limited given the state statutes and rules. It is recommended that the City look for other more compatible tools to influence sustainable practices within the community. The following are examples of other actions the City could consider in order to improve the general sustainability of the economy over time: a. Designate staff facilitator(s) to assist sustainable enterprises via information, referrals and guidance through an array of development review and permitting processes. b. Create an expedited permit processing loop for projects that meet recognized green building standards. c. Target planned capital improvements in nodal development areas, and in areas where redevelopment opportunities exist. d. Continue to support alternative modes of transportation such as BRT. e. Consider new urban renewal options. L:\CMO\2004 Council Agendas\M040929\S040929C.DOC