Remarks by Governor Kulongoski at Intel Analysts Briefing
~as prepared for delivery~
Good afternoon and welcome to Oregon. I want to thank Intel for inviting me to join you today to share a bit about Oregon and how our technology industry has thrived locally and globally – and how we’re looking to the future to ensure that we not only remain competitive with neighboring states – but that Oregon remains competitive with countries throughout the world.
One of Oregon’s best-kept secrets is that this is a great place to do business. Our reputation generally is one of livability, sustainability and progressive policies. We have clean air, the beautiful mountains, pristine coastline, forests, deserts, and a high standard of living.
But Oregon is also home to companies with great success stories – like Intel and Nike and Columbia Sportswear and Tektronix. The values of these companies reflect the values of our state and reflect our commitment to opportunity, collaboration and innovation – coupled with our great quality of life.
Oregon values the technology sector – which is a critical part of my economic vision for the state. I have said many times that I want to make Oregon “the Innovation State.”
I want Oregon’s economy to be driven by innovation so as to attract and retain the best and the brightest to both support the growth of existing companies – like Intel – and to create opportunities for anyone with an idea and the determination to build a business or begin a career.
Intel is an important partner of mine as I work to advance these goals.
Intel’s facilities in Oregon are the world’s largest and most advanced center of semiconductor research and manufacturing – which is a fact that many people, including many Oregonians, do not know.
And many more aren’t aware that right here in Hillsboro – Intel leads the world in micron-level research and development and manufacturing.
Intel now has eight campuses devoted to every stage of semiconductor research and development, manufacturing, facility support, and the development of products that imbed silicon further and deeper into our society.
In fact, today almost every major Intel business unit is represented in Oregon. And as the Governor, I am very thankful for that.
Intel’s work here is also highly capital-intensive. That can be directly attributed to the passage of the Strategic Investment Program (SIP) – which most recently has delivered a $25 billion investment from Intel over the next sixteen years.
As Oregon’s largest private “research university,” more patents come out of Intel in Oregon than in any other Intel location in the world – and Oregon is ranked among the top-ten states for developing patents that lead to commercialized products.
What you are seeing in Oregon is Intel’s commitment and investment in research and development systems known as fabs. The technology developed in Oregon is used by Intel in their other manufacturing systems throughout the world.
Recognizing that the high technology sector is very competitive both nationally and internationally, the State of Oregon is proud of our partnerships with our high technology community. As an example, Intel’s history of investment in Oregon is quite different than in other states.
As I mentioned earlier, Oregon is the state where Intel does the research to develop new products and new processes.
And Oregon is the incubator for companies to be leaders in innovation and product development.
With all of our success in building a world-class high tech sector here in Oregon, we must always be looking to the future and anticipating those changes that will determine success or failure in the global market place.
Let me speak for a moment about some of the changes we see emerging:
- The “Young and Restless”: Not the Soap Opera, but the fastest growing demographic in Oregon the 21-35 year olds who are bright, creative and diverse. They value Oregon’s quality of life, want a strong education system, and an economy that offers high wages, challenging professional opportunities, and are hungry for the chance to be a part of a company that will break new ground – and continue to grow and prosper.
- A Global Economy: It’s almost trite to say that we now live and work in a global economy, but it is true – and Oregon has always been a state with a global view. We are #7 nationally in terms of reliance on exports. One third of the economic output in the Portland Metropolitan area relies upon exports. And with the rapid proliferation of the Internet we are more global than ever.
- Digitization: With the digitization of society, we are seeing the globalization of communications, commerce and entertainment. Organizations that are serious about competing in the instant-communication, digitized, global environment -- are those who are willing to focus on the following factors;
o Invest in infrastructure;
o Pay attention to factors which affect the time value of money;
o Make lands available for industrial development and redevelopment; and
o Investment in education and workforce and skills training.
In Oregon, we’re paying attention to all of these factors, because the bottom line question we ask ourselves is: How can we ensure that our companies compete and succeed in the global economy?
Under my administration, we’ve focused on partnering with Intel and others to make them successful here.
We are also aggressively working with businesses to help them transition their workforce as conditions and technology’s change – so their workforce has the skills they need to adapt to ever changing conditions.
What, exactly are we doing?
- Regulatory Streamlining: Making “time is of the essence” a part of our regulatory process has been a major objective of my administrations approach to regulatory government. Whether it is a permit, license or some other governmental approval we want to reduce the time and paperwork involved in getting the project going. As an example, when I became Governor, some of our regulations that Intel complies with had a one-size-fits-all approach that treated the installation of Intel’s sophisticated equipment in their new D-1D facility here in Hillsboro, the same way as other commercial equipment such as air conditioners or air compressors that contained electrical components. Upon learning of this situation on one of my early trips to Santa Clara we turned our regulatory practice on its head and tailored the regulation to the technology.
- Utilization of a Single Sales Factor.
- Open Source Technology Development: Google’s recent grant to Portland State University and Oregon State University for a joint open-technology center will focus on encouraging open source software and hardware development, developing academic curricula and providing computing infrastructure to open source projects worldwide.
- Oregon, Inc.: A partnership of industry – including Intel – government and education focused on:
o Statewide signature research centers.
o Making it easier to commercialize research into products.
o Increasing access to start-up capital for traded sector businesses.
o Fostering the entrepreneurial and workforce talent for companies in innovative and global markets.
- ONAMI: Secured $7 million with potential to generate up to $14 million for research.
- Pacific Northwest National Lab (PNNL): Investing their capital in Oregon; bringing more than 20 PhDs to work with ONAMI.
- Industrial Lands:
o Certified 2,800 acres to allow projects to begin in 180 days.
o Working to bring it down from 180 to 90.
o Lured Google and Yahoo! here through my industrial lands program.
But Intel’s presence – and the strength of the entire technology industry – in Oregon transcends just high-tech.
This niche helps make the state competitive across the entire range of traded sector industries.
But in order to maintain this edge, we must make decisions today based on the impact they have on the future – which is why I have focused on shoring up our educational system in Oregon.
o Education Enterprise – pre-K through graduate school and workforce training.
o Better Schools – Bill Gates comment – we need to retool our high schools; make relevant to students; challenge students; prepare for what they need to know for the future (not keep teaching same as we have in the past).
o Expand Access to College – Opportunity Grants
o Workforce Training/Skills Training – The key to providing the quality workforce to help companies like Intel succeed is to ensure Oregon has the most qualified and skilled workforce in the nation.
I recognize that "traded sector" companies like Intel can go anywhere in the world to make their investments.
I have tried to build my understanding of that fact into a consistent part of my program and policies as governor.
I have worked closely with Intel and other companies to make Oregon a great place to invest and grow.
Today, as a result of policies of governors and legislatures past, and of the work we are continuing today, I believe Oregon has a set of tools available to keep the state competitive:
• We are among the most wired places in the world.
• We are also among the most wireless places in the world.
• Our overall business costs are among the lowest in the nation – we have no sales tax, no inventory tax, state business or occupations tax.
• We are the only state to see fifteen years without an increase in workers’ compensation insurance rates.
• We are moving forward and continuously improving our industrial land program.
• We have world-class incentive programs available to keep the cost of business down, while drawing the kind of investment that leads to good jobs and strong community investment.
I recognize that Oregon isn't competing with just Arizona or New Mexico for investment. We are competing with China, India, Singapore and Russia.
Countries are aggressively courting traded sector industries, and states need to approach this like the global competition that it is – and as Governor, that’s exactly what I’m doing.
I’ve traveled to China, Japan and Germany. More importantly I have traveled to Santa Clara twice to hear these messages directly from Intel CEOs so that I knew how we could work to make Oregon the best state in the country for future Intel investment.
While Oregon’s economy was struggling as a part of a global slowdown, I took a long-term, pragmatic and responsible approach – and we’re on the right track with the sixth fastest growing economy in the nation; lowest unemployment rate in more than four years; record numbers of employed Oregonians – and second in the nation for information job growth.
Our focus and partnership with the private sector is delivering results.
That's the kind of leadership that is typical of Oregon, and it is an approach we will continue.
Media Contact:
Anna Richter-Taylor, (503) 378-6496
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