Umatilla officials weigh how to share enterprise-zone revenue as city faces $280M in near-term capital needs

Umatilla’s city staff outlined a yearlong effort to engage taxing districts on how to distribute enterprise-zone abatement revenues, stressing that the city faces large infrastructure needs even as new development brings more money into municipal coffers.

"The total amount of capital improvement required according to all of our master plans over the next 20 years is $476,000,000 over the next 20 years," the city manager said, presenting a combined CIP list meant to show the scale of future projects. He added that the city's expected near-term need is "about $280,000,000 between now and 2030." Those figures framed a sustained council discussion about what, if anything, the city should share with other local taxing districts.

Why it matters: enterprise-zone tax abatement is an economic development tool that can redirect tax revenues to encourage private investment; as the city receives larger sums, elected officials must weigh trade-offs between funding systemwide infrastructure (water, sewer, reservoirs) and offering earmarks or grant programs to special districts such as the hospital, fire and mosquito districts.

What staff told council: the manager said staff has met twice with chief appointed officials from taxing districts and will circulate a questionnaire in August to ask districts whether they prefer upfront earmarks, a grant program, percentage distributions, or other approaches. He said the enterprise zone will yield roughly $1,000,000 to the city this year and that "total from enterprise zone to date, we've received 6,700,000.0." Staff also noted a roughly 50/50 split with the county on enterprise-zone receipts.

Key concerns and options discussed: councilors and staff raised several recurring points:

- Equity and scale: councilors noted that many small districts would receive amounts such as $50,000–$75,000 annually while the city and county receive larger shares; staff warned that splitting funds among many districts could limit impact.

- Prioritization: staff recommended workshops or roundtable sessions so the council can prioritize projects within the $280M six-year need rather than make ad hoc distributions.

- Alternative supports: the manager suggested non‑cash support (shared grant-writing resources, pooled lobbyist efforts) as a way to help districts obtain state or federal funding rather than rely solely on enterprise-zone distributions.

- Legal and geographic limits: staff noted that many of the industrial park projects lie in neighboring school-district boundaries (Hermiston), meaning enterprise-zone proceeds would not all remain inside Umatilla unless additional tools (local levy, urban renewal) are used to retain funds locally.

Operational context: staff emphasized some urgent system needs that would not be covered by small, recurring district payments — for example, the wastewater treatment plant needs expansion and some developing neighborhoods currently rely on temporary or smaller-diameter mains. The manager said parts of South Hill are operating on an emergency backup main because a flood damaged a major pipeline.

Council direction: members encouraged continued engagement with taxing districts, suggested joint work sessions with the county and other districts, and asked staff to return with narrower options and supporting data (project priorities, budgets and suggested approaches to earmarks vs. grants).

Next steps: staff will distribute a questionnaire to taxing districts in August, continue meetings, and bring back focused policy options and potential workshop dates for council consideration.