Washington County, Oregon Board of Commissioners last updated: January 18, 2005 MINUTES WASHINGTON COUNTY BOARD OF COMMISSIONERS MAY 17, 2005 CONVENED: 10:09 a.m. BOARD OF COMMISSIONERS:

Chairman Tom Brian Vice Chair Andy Duyck Commissioner Dick Schouten Commissioner John Leeper Commissioner Roy Rogers (Participated by telephone from out-of-town conference) STAFF: Charles D. Cameron, County Administrator Dan Olsen, County Counsel Chris Gilmore, Assistant County Counsel Kathy Lehtola, Director, LUT Brent Curtis, Planning Division Manager, LUT Mark Brown, Land Development Manager, LUT Suzanne Savin, Senior Planner, LUT Paul Schaefer, Senior Planner, LUT Steve Conway, Senior Planner, LUT Terry Lawler, Senior Planner Rural, LUT Greg Miller, County Engineer Bob Cruz, Deputy General Manager, CWS Patt Opdyke, CPO Coordinator Jeff Friend, Audiovisual Specialist Barbara Hejtmanek, Recording Secretary

PRESS: Dick Colby, The Oregonian APPROVAL OF MINUTES:

April 26, 2005 (Approved as corrected) May 3, 2005 1. CONSENT AGENDA

Chairman Brian announced the following awards of bid: On item p., there is award of bid for Project A to Gonzales Boring and Tunneling in the amount of $214,939.00 On item q., there is award of bid for Project B to Eagle-Elsner, Inc. in the amount of $377,142.50. On item r., there is award of bid for Project C to Eagle-Elsner, Inc. in the amount of $95,653.25. On item s., there is award of bid for Project D to Kerr Contractors, Inc. in the amount of $270,034.25. On item x., there is award of bid to Blackline in the amount of $745,184.53. It was moved to adopt the Consent Agenda, as modified. Motion Duyck 2nd Leeper Vote 5-0 CLEAN WATER SERVICES

1.a. CWS RO 05-19 Acquire Easements for Sanitary and Storm Sewer (Approved Under Consent Agenda) 1.b. CWS RO 05-20 Endorse Boundary Change Proposal for Annexation to Clean Water Services Service District (WA-0705) (CPOs 12F, 13) (Approved Under Consent Agenda) 1.c. CWS RO 05-21 Endorse Boundary Change Proposal for Annexation to Clean Water Services Service District (WA-1405) (CPO 5) (Approved Under Consent Agenda) 1.d. CWS MO 05-31 Approve Encroachment Agreement with Dave and Elizabeth Downey (CPO 1) (Approved Under Consent Agenda) 1.e. CWS MO 05-32 Award Contract for Uniform Rental and Laundry Services to Alsco, Inc. (Approved Under Consent Agenda) 1.f. CWS MO 05-33 Quitclaim a Portion of a Sanitary Sewer Easement to the Helen A. Loos Revocable Living Trust (CPO 4M) (Approved Under Consent Agenda) LAND USE AND TRANSPORTATION

1.g. MO 05-154 Approve Agreements with the City of Beaverton Regarding Recently Annexed Property and Permit Issuance (CPO 1, 3, 7) (Approved Under Consent Agenda) 1.h. RO 05-78 Approve Declaration of Necessity and Protective Rent Payments for Right-of-Way Acquisition for Timber Road Culvert Over Beaver Creek Project (CPO 14) (Approved Under Consent Agenda) 1.i. RO 05-79 Approve Declaration of Necessity and Protective Rent Payments for Right-of-Way Acquisition for the SW 66th Avenue and SW Parkwest Lane Culvert Replacement Project (CPO 3) (Approved Under Consent Agenda) 1.j. RO 05-80 Approve Agreement with Cornelius for Right-of-Way Services, Declaration of Necessity and Protective Rent Payments for Right-of-Way Acquisition for the Susbauer Road Bridge Project (CPO 12, 13) (Approved Under Consent Agenda) 1.k. RO 05-81 Approve Establishment of a Road Maintenance Local Improvement District (MLID) for Bradburn Estates (CPO 6) (Approved Under Consent Agenda)

1.l. RO 05-82 Approve Establishment of a Road Maintenance Local Improvement District (MLID) for Hampton Place (CPO 3) (Approved Under Consent Agenda)

1.m. RO 05-83 Approve Establishment of a Road Maintenance Local Improvement District (MLID) for Nicole Estates (CPO 6) (Approved Under Consent Agenda)

1.n. RO 05-84 Approve Establishment of a Road Maintenance Local Improvement District (MLID) for Ping Woods (CPO 6) (Approved Under Consent Agenda)

1.o. RO 05-85 Approve Establishment of a Road Maintenance Local Improvement District (MLID) for West Parc at Bethany Village (CPO 7) (Approved Under Consent Agenda)

1.p. MO 05-155 Approve Bid Award, Execute Contract for 2005 Culvert Replacement Program (Project Group A) (CPO 14) (Approved Under Consent Agenda)

1.q. MO 05-156 Approve Bid Award, Execute Contract for 2005 Culvert Replacement Program (Project Group B) (CPO 13, 12F, 3, 4M) (Approved Under Consent Agenda)

1.r. MO 05-157 Approve Bid Award, Execute Contract for 2005 Culvert Replacement Program (Project Group C) (CPO 5) (Approved Under Consent Agenda)

1.s. MO 05-158 Approve Bid Award, Execute Contract for 2005 Culvert Replacement Program (Project Group D) (CPO 3) (Approved Under Consent Agenda)

COMMUNITY DEVELOPMENT 1.t. MO 05-159 Approve HOME Investment Partnership Project Agreement for Willamette West Habitat for Humanitys Farmington Road Development (Approved Under Consent Agenda)

SUPPORT SERVICES

1.u. MO 05-160 Amend Contract with Geodesign, Inc., for Environmental Engineering Services (Approved Under Consent Agenda)

SERVICE DISTRICT FOR LIGHTING NO. 1-A COUNTY SERVICE DISTRICT

1.v. SDL RO 05-18 Form Assessment Area, Authorize Maximum Annual Assessment and Impose a First Year Assessment for Bradburn Estates (CPO 6) (Approved Under Consent Agenda)

1.w. SDL RO 05-19 Form Assessment Area, Authorize Maximum Annual Assessment and Impose a First Year Assessment for Rosa Orchards (CPO 6) (Approved Under Consent Agenda)

URBAN ROAD MAINTENANCE DISTRICT-A COUNTY SERVICE DISTRICT

1.x. URMD MO 05-2 Approve Bid Award for 2005 Crack Seal and Slurry Seal Projects (All CPOs) (Approved Under Consent Agenda) 2. ORAL COMMUNICATION (2 MINUTE OPPORTUNITY) Carolee Tyson, 20847 NW Pumpkin Ridge Road, North Plains, Oregon, informed the Board that a neighborhood task force has formed to fight the proposed development at Hornings Hideout. She stated that Hornings Hideout is trying to expand by adding 2,975 campsites for group concerts. Ms. Tysons understanding was that the County is denying the land use. She told the Board that Hornings Hideout has already filed a Measure 37 claim. Ms. Tyson indicated that the entire neighborhood is opposed to this development and wishes to help ensure that this development does not happen. Phyllis Squeglia, 20701 NW Keller Road, North Plains, Oregon, agreed with Ms. Tysons comments about Hornings Hideout. She reported that there is a land use hearing tomorrow regarding this matter. Ms. Squeglia referenced a petition that has been signed by 150 people, which requests that this development be denied. (Petition may be found in the Meeting File.) She stated that the noise, traffic, vandalism and other impacts from past concerts would affect people from a large area. Ms. Squeglia mentioned that the community has safety concerns regarding Pumpkin Ridge Road, which she characterized as a two-lane, substandard, curvy, hilly road. She said that this road is used by walkers and bicyclists. Ms. Squeglia believed that an extra 1,000 to 3,000 cars per day during concert periods would not represent the best use of this road. She hoped that Hornings Hideouts claim would be denied. Isador W. Morgavi, 15145 SW 119th Avenue, Tigard, Oregon, submitted a handout, which may be found in the Meeting File. He said that on October 22, 1996, Washington Countys Ordinance 487 adopted a new Article VIII for the Washington County Development Code amending the West Tigard Community Plan and the Bull Mt. Community Plan. Mr. Morgavi stated that neither Ordinance 487 nor Article VIII makes reference to annexation. He commented that sometime in 2000, the City of Tigard began requiring applicants for development permits to sign an agreement that they would be annexed into the City of Tigard at some later date. Mr. Morgavi told the Board that he called King City, Beaverton and Portland and was told this was not their policy. He reported that the City of Tigard has cited the following authority for requiring annexation: Sections 222.115, 222.173, 222.175. (See handout.) Mr. Morgavi remarked that he cannot find where the statutes authorize Tigards practice. He believed that the City of Tigard has illegally coerced property owners. Mr. Morgavi asked the Board to stop this practice and to review all annexations done using this practice. He assured the Board that he has made an honest effortboth verbally and in writingto obtain the desired information from Tigard. Mr. Morgavi described a process around where he lives that is creating islands and feared that he and his neighbors would be dragged into the City of Tigard against their wills. He characterized this as illegal coercion and asked the Board to do something about it. Chairman Brian promised that the County would review his material and ask Counsel to determine a) if there is an inappropriate activity, and b) if the Board has the authority to do anything about it. He said that someone would be getting back to Mr. Morgavi. 3. PROCLAMATIONS

3.a. MO 05-150 Proclaim May 15 through May 21, 2005 as National Public Works Week The Clerk of the Board read the proclamation into the record. Kathy Lehtola informed the Board that staff held a very successful Public Works Fair at Washington Square over the past weekend. She indicated that Clean Water Services and Washington County have jointly sponsored this. Mrs. Lehtola called attention to a display in the main lobby of the Public Services Building all this week pertaining to this proclamation. Chairman Brian thanked the Countys public works staff as well as the public works staff of the cities and special service districts. He recognized that these workers go about their jobs day after day, rain or shine, floods, snow, or whatever appears in order to keep citizens safe and their movements convenient. Chairman Brian observed that this quiet group of workers really affects the quality of lives for citizens and thanked them for this. Commissioner Schouten commented that much of the Countys private wealth, initiative and ability to do well on the private side is built on the secure foundation of public investments in public infrastructure. He noted that this is often taken for granted but pointed out that an example such as Iraq illustrates that political stability itself is dependent upon having good public infrastructure in place and in good repair. Having worked in the area of transportation and with Clean Water Services for a number of years, Commissioner Rogers acknowledged that the degree of sophistication staff is asked to conduct is amazing. He noted that highly trained, competent people perform very difficult, complex tasks. Commissioner Rogers went on to say that these employees consistently go above and beyond to meet demands in an environment where the County must seek federal, state and regional funds and work collaboratively with neighbors in the region, state and federal delegation. It was moved to issue the proclamation supporting May 15 through May 21, 2005 as National Public Works Week in Washington County. Motion Rogers 2nd Leeper Vote 5-0 3.b. MO 05-151 Proclaim May 15-21, 2005 as Emergency Medical Services Week The proclamation was read into the record by the Clerk of the Board. Sheila Jackson, Senior Paramedic Field Training Officer, Metro West Ambulance, was honored that the Board has trusted Metro West Ambulance to serve Washington County. She reviewed that Metro West has provided ambulance service in Washington County since 1953. Ms. Jackson stated that this proclamation is important to the many EMS teams in the county. She said that Metro West EMTs are part of the team of professionals providing pre-hospital emergency health care to the citizens of Washington County. Ms. Jackson reported that employees of Metro West strive every day to earn the Boards trust. She commented that because of the Boards commitment and support, Washington County enjoys one of the finest emergency health care systems in Oregon. Ms. Jackson thanked Dr. Skip Friedman, Medical Director; Steve Dargan, Senior EMS Coordinator; and Susan Irwin, Director of Health and Human Services for continued support and guidance. She explained that Metro Wests goal is to meet the emergency needs of Washington County residents in a compassionate, timely, professional manner. J. D. Fuiten, Owner, Metro West Ambulance, invited the Board to attend the EMS barbecue on Friday, May 20, 2005 at the Dawson Creek headquarters from 4 to 7 p.m. He presented a plaque of appreciation to Chairman Brian. Chairman Brian observed that this is a great emergency system andjoked that everyone hopes not to have a lot of interaction with it. He said that it is sure good to know that Washington County has a top-flight emergency management system, including Metro West. Chairman Brian reflected that it has been a great relationship in terms of performance standards and the costs of service, when compared to other jurisdictions. He thanked Mr. Fuiten and his employees for making this fine service available when needed. Mr. Fuiten responded that it is Metro Wests pleasure and honor to do this everyday. Commissioner Schouten commented that people take so much for granted. He noted that for this brief moment, everyone can think about this and realize how fortunate they are in Washington County and in the country. It was moved to proclaim the week of May 15-21, 2005 as Emergency Medical Services Week in Washington County. Motion Duyck 2nd Leeper Vote 5-0 OFF DOCKET SHERIFFS OFFICE MO 05-161 Proclaim May 18, 2005 as Peace Officers Memorial Day The Clerk of the Board read the proclamation into the record. Chairman Brian noted that the proclamations today seem to follow a theme, i.e., the tremendous individuals out there quietly doing their jobs every day while serving the citizens and visitors. He pointed out that this particular proclamation especially notes the officers who have given their lives in the performance of their duties. It was moved to proclaim May 18, 2005 as Washington County Peace Officers Memorial Day in Washington County. Motion Schouten 2nd Duyck Vote 5-0 4. PUBLIC HEARINGS LAND USE AND TRANSPORTATION

4.a. RO 05-72 Consider the Annexation of Approximately 57 Acres to the Clean Water Services District (WA-0705) (CPO 12F) Suzanne Savin read the rules of procedure into the record. Ms. Savin told the Board that the applicant requests that the subject propertycomprised of four parcels totaling approximately 57 acresbe annexed to the Clean Water Services District and proposes the development of a 217 lot, single-family, residential subdivision on the subject property. She stated that the property must be brought into the district for the development to be provided with the necessary storm and sewer service. Ms. Savin indicated that three of the four parcels are located within the City of Forest Grove. She added that the city annexation of the fourth parcel (Tax Lot 801) is in process. Ms. Savin reviewed that on May 9, 2005, the Forest Grove City Council held the first reading for the city annexation of Tax Lot 801. She reported that the second reading and City Council decision is scheduled for May 23, 2005. Because the City Council has not yet approved the annexation of Tax Lot 801, Ms. Savin recommended that the Board continue this hearing until the citys annexation decision has been made. She also recommended that the Boards decision be continued to June 21, 2005. Ms. Savin explained that this date factors in a possible continuance of the citys May 23rd decision to its next meeting on June 13th. She noted that if the city does approve the annexation as scheduled on May 23rd, the annexation will not be effective until June 23rd. The public hearing was opened. Tim McDonald, Developer of the Project, 7885 SW Miller Hill Road, Aloha, Oregon, asked the Board to approve this item today rather than to continue it, pending the City of Forest Groves outcome. He made this request based on a desire to save time. Chairman Brian asked staff to explain why this order of action is being recommended. Suzanne Savin said that it is staffs understanding that the Boards policy prior to service district annexations is that all the involved parcels be annexed into the City of Forest Grove. She specified that in this case, because the status of Tax Lot 801 has not been officially decided by the city, staff recommends that the Boards decision be deferred until such time as the citys decision has been made. Mr. McDonald stated that this is a nondescript piece of property and added that there has been no opposition expressed at the city level. He believed that this is just a case of the city being slow to annex and he wished to speed up the process. Vice Chair Duyck commented that the Board has become highly sensitized to the issue of providing services prior to cities annexing because often, once services are given, properties do not annex to the cities. He observed that the County is then left providing additional city-type services in an unincorporated area. Chairman Brian wished there was a way to approve this contingent upon the citys adoption so that there is no unnecessary delay. Mr. McDonald wondered if there is any vehicle to do that at present. Chairman Brian said that maybe the Board could take the action desired by Mr. McDonald in a week or so, after having had the chance to examine the policy further and the legality of contingent approval. Kathy Lehtola suggested that the Board continue this for one weekMay 24, 2005. She commented that staff would know at that time if the Council took action on May 23rd. Mrs. Lehtola spoke of the possibility of continuing it further at that time. She said that staff needs to speak to Counsel regarding the legality. Mrs. Lehtola stated that if the Board continues the matter one week, staff will at least have the status of the Forest Grove action and will have had the opportunity to confer with Counsel on further actions. Chris Gilmore told the Board that in one week, staff would also have a written decision which reflects the action, along with appropriate conditions of approval if there is a contingency that needs to be provided in that decision. Suzanne Savin ascertained that this item will need to be off docket, if continued one week. She reminded the Board that even if the city annexes this as scheduled on May 23rd, the annexation will not be effective until June 23, 2005. (There is a 30-day appeal period.) It was moved to continue this public hearing to May 24, 2005. Motion Duyck 2nd Schouten Vote 5-0 Commissioner Rogers did not oppose acceleration of projects but was concerned about staffs mention of Forest Groves appeal process. He noted that the city has to allow time for any appeal process. Commissioner Rogers wanted to know if sewer service would be provided if the annexation occurred but was under appeal to LUBA for years. Chairman Brian stated that the intent of the motion is merely to continue this matter to next week. He regarded Commissioner Rogers question as excellent and observed that this would have to be answered by next week. Chairman Brian went on to say that if these issues can be handled satisfactorily and consistently with County policy, there may be a way to make this happen faster. Commissioner Rogers pointed out that because the City of Forest Grove has a 30-day waiting period anyway for an appeal process, it is questionable what is being accomplished by a one weeks continuance. 4.b. RO 05-73 Consider the Annexation of Approximately 15.77 Acres to the Clean Water Services District (WA-1405) (CPO 5) Suzanne Savin read the rules of procedure into the record. Ms. Savin reported that the applicant requests that the subject property (approximately 15.77 acres) be annexed to the district in order to facilitate the future development of the property. She stated that the property is located within the City of Sherwood and that the applicant proposes to develop an industrial park on the property for light industrial uses. Ms. Savin specified that the property must be brought into the district for the development to be provided with the necessary storm and sewer service. Based on the analysis in the Staff Report and the Findings and Conclusions in Exhibit A, she recommended that the Board approve WA-1405 with the approval becoming effective immediately. The public hearing was opened. No public testimony was offered. The public hearing was closed. It was moved to adopt the Resolution and Order approving the annexation with the approval becoming effective immediately. Motion Schouten 2nd Leeper Vote 5-0 Vice Chair Duyck ascertained that both parcels are within the city limits at this time. 4.c. RO 05-74 Remove Dedication of a Portion of Valkyrie Memorial Park (CPO 1) Kathy Lehtola informed the Board that staff has received a request from Sunset Hills Memorial Park to remove from dedication for cemetery purposes a portion of their park. She said that they have indicated that no interments have been made in this area. Mrs. Lehtola commented that it is unimproved and they see no future need for it for cemetery purposes. She therefore requested that the Board remove the dedication from that portion of the Valkyrie Memorial Park. Mrs. Lehtola said that Greg Miller is present to address any technical questions. The public hearing was opened. No public testimony was provided. The public hearing was closed. It was moved to remove dedication of a portion of Valkyrie Memorial Park. Motion Duyck 2nd Schouten Vote 5-0 4.d. RO 05-75 Consider Measure 37 Claim by Ronald & Duane Spiering (CPO 14) Mark Brown provided the following facts regarding this claim: There are two claims here numbers 19 and 20 with the same owner. The claim involves about 77 acres in two tax lots. The property is situated at the end of Elk Mountain Road, to the southwest of the Sunset Highway. The Spierings acquired this property in 1975. The property is in an AF-20 district and there are two dwellings at the present time. The proposal is to divide one of the properties into four ten-acre lots and to construct two additional dwellings. The other property would be divided into seven five-acre lots and seven dwellings would be constructed on that portion. At the time the owners acquired the property, it was zoned AF-10 on one piece and AF-5 on the other. Claimants estimate the loss in value for the combined two properties at $1.7 million. Staff had determined that the claimant has met the minimum requirements for submitting a claim. Under Ordinance 636 and Measure 37, the Boards options are to either 1) approve compensation or 2) waive the identified regulations to permit development. Mr. Brown recommended that the Board decide not to apply certain provisions of the Community Development Code (See staff report for cited sections). He requested the Board to make one change to page 6 of the Staff Report, item 1, under Conditions of Approval: insert the word "potential" so that it reads "potential applicable state law requirements include but are not limited to". Mr. Brown indicated that the complete file is available for viewing and is part of the record in this matter. Ronald Spiering told the Board that he purchased the land in 1975 and that it was zoned AF-5 and AF-10. He stated that the property is in Star Satellite Water District boundaries. Mr. Spiering indicated that a reservoir is to the north and that the main line runs down through the center of it. He said that water could be furnished to homes. Lars Amlie, 44950 Elk Mountain Road, Banks, Oregon, stated his understanding that there are two lots involved in this application. He shared that he voted for Measure 37. Mr. Amlie said that if it is correct that the County or State wronged the Spierings to their financial detriment, then the County should let them go back to the original AF-5 and AF-10. Mr. Amlie supported the Spierings application with the caveat that road access be addressed. He stated that he has been assured by Ronald Spiering that the road access will be through the southern end of the lower piece through an easement. Mr. Amlie remarked that Elk Mountain Road is a road that is privately owned by 27 landowners. He explained that the people who own Elk Mountain Road granted the Spierings access to two dwellings but that these people do not feel that the road should service the additional acreage. Mr. Amlie reiterated his support for this claim but asked for reassurance that the access will come from the southern end through the easement. Vice Chair Duyck believed that any additional conditions would be issued at the time of the permit issuance rather than at todays hearing. Mark Brown affirmed that this is correct. He stated that access and waterline issues will be dealt with in the development review process. Mr. Brown summarized that the Measure 37 claim part of todays decision is to identify those regulations that need to be waived in order for the development to proceed to the next step. Vice Chair Duyck felt that there is probably a lot of misunderstanding about that in that citizens are under the mistaken impression that conditions can be applied at this stage of the process. Chairman Brian stated that once the owner chooses to develop the property, he will be subject to the normal building codes, provision of sewer or septic tank, water, and other conditionsincluding road access. He noted that these will all be determined at the time of application. Chairman Brian observed that the County cannot enforce or create private agreements between parties. Norm Sawyer, 44800 NW Elk Mountain Road, Banks, Oregon, wanted to know if he would be notified at the time of application. Mr. Brown addressed what will happen at the time of the development application, namely, that notice will be provided to those property owners within 1,000 feet of the perimeter of these two tax lots. He said that if Mr. Sawyer received notice for todays hearing, then he is in that area. The applicant did not have anything to say under rebuttal. The public hearing was closed. It was moved to approve Claim No. 37CL00019 and 37CL00020 through Resolution and Order, pursuant to the recommendation in the Staff Report and with the addition of the word "potential" to that report. Motion Duyck 2nd Schouten Vote 5-0 Chris Gilmore corrected a clerical error in the Resolution and Order: it should read May 17 rather than May 3. He clarified that the Resolution and Order incorporates the Staff Report. Commissioner Leeper wished to offer a comment relevant to all three of todays claims. He stated that even if the Board approves the claims, there is still a requirement to get clearance from the state before a land use application can be submitted. 4.e. RO 05-76 Consider Measure 37 Claim by Paul Unger (CPO 11) Mark Brown provided the Board with the salient elements of this claim: The Unger property is located on Strongtown Road, southwest of Forest Grove. The claim involves approximately 19.5 acres. The Ungers acquired this property in 1972. The property is situated in an Exclusive Farm Use district and currently has one dwelling on the property. The proposal is to divide this into approximately 20 one-acre lots and to then be able to construct 19 additional dwellings. At the time the Ungers acquired the property, it was zoned F-1; at that time, this district did not have a minimum lot size. The claimant estimates loss in value resulting from the land use regulations as $1.2 million. The Director and staff have determined that the information submitted meets the minimum requirements for making a claim. The measure and ordinance provide the Board with the choice either to 1) approve compensation or 2) decide not to apply certain regulations in this case. Mr. Brown called attention to page 5 of the Staff Report, under Conclusions, where it should read "potentially applicable State law requirements include but are not limited to". He recommended to not apply certain provisions of the Community Development Code and listed these. (See Staff Report.) Mr. Brown commented that the complete file is available for viewing and is part of the record in this matter. The public hearing was opened. Paul Unger, 4445 SW Puma Drive, Forest Grove, Oregon, stated that he bought this property in 1972. He remarked that he wanted to develop the property then but did not have the money. Mr. Unger said he does have the money now and would like to do what he wanted to do originally. Robert Epler, 44641 SW Plumlee Road, Forest Grove, Oregon, did not oppose this claim but stated that it would place quite a crimp in his blueberry operation. His understanding was that the people to the north are going to put in a claim also on 600 acres. Mr. Epler recognized that he would be in a little pocket and that it would be very difficult to carry on with what he is doing at the present time. He acknowledged that the Board is in a position where it pretty much must approve these claims. Mr. Epler asked that he be given the same consideration if he chooses to do so at some point in the future. Chairman Brian responded that if Mr. Epler qualifies under Measure 37, he would certainly have that right. The public hearing was closed. Vice Chair Duyck observed that Mr. Unger is requesting 20 lots on roughly 20 acres, which brings it down to one acre apiece. He noted that County Code calls for residents to have two acres for a septic system. Vice Chair Duyck wondered if Mr. Unger would be unable to get one acre lots at the permit stage or, alternately, if sewer is being provided to these lots currently. Mark Brown responded that the two acre figure is a rule of thumb rather than a code standard per se. He said that it is typical to get a well and septic system on a piece of property for a dwelling on at least two acres. Mr. Brown thought that the applicant in this case is counting on being able to get public water that is generally available in this area. He reasoned that if he can actually get a proper septic system on one acre lots, then he might be able to do what he is proposing. Vice Chair Duyck commented that he is learning as he goes through this process. Chairman Brian observed that whether the claimant actually gets 20 one-acre lots out of this after access, road, sewer/septic and water issues is yet to be seen and is subject to the application process. Commissioner Schouten added that this is still subject to the continuing exemption relative to public health and safety, which may yet come into play. He wondered about the policy of the City of Hillsboro regarding water lines and providing water service to areas outside the Urban Growth Boundary and outside its jurisdiction. Commissioner Schouten wanted to know what limits there are, if any, in the Dilly area as far as water service is concerned as well as the policy implications pertaining to that. He asked if these are exclusively Hillsboro water lines or if they are owned by the Joint Water Authority and if other agencies would have to approve this. Mark Brown had no definitive answers to these questions. He indicated that he has had discussions with the City of Hillsboro about this particular area and these water lines and services that are outside city limits. Mr. Brown said that a more thorough discussion with the city will have to wait for another day relative to its stance during the development process and how freely the city will provide water to people with new developments. He reported that Measure 37 does not allow the waiving of what would be public health standards. Mr. Brown affirmed that rules applying to septic systems will still exist and will still be enforced. Chris Gilmore stated that it is not necessarily a Measure 37 question as to whether water will be provided; it is more a question whether the city would have authority to extend the water line. He commented that in that case, it is not clear how Measure 37 would apply. Mr. Gilmore did not know if the city would need waivers or whether the city would have other hurdles to address in terms of potentially allowing other urban uses outside the UGB, etc. He reiterated that those issues are not necessarily a Measure 37 question but rather have more to do with the authority of the city to extend the water line. Commissioner Leeper recalled that some months ago, the Board declined to extend a water line to one residence in Multnomah County. In his mind, this set a precedent for extension of water lines. Commissioner Leeper realized that in this particular case, the City of Hillsboro is the subject of focus. However, he was keeping an eye on the extension of water lines to areas outside the UGB and city limits. Commissioner Leeper turned to the topic of the road network in that immediate area and the connecting roads onto major arterials to accommodate the number of additional vehicles that would be using those roads. He thought this is a consideration that Mr. Unger (as well as any other owner of property who wants a fairly sizable number of lots on his property) is going to have to consider. Commissioner Leeper added that the County is also going to have to give some serious thought to this because, particularly in the rural areas, the last thing the County wants to do is to approve the construction of a sizable number of residences and then find the supporting road network is overloaded. It was moved to approve Claim No. 37CL00024 by Resolution and Order. Motion Leeper 2nd Rogers Vote 5-0 4.f. RO 05-77 Consider Measure 37 Claim by Harvey Kempema (CPO 8) Mark Brown reported the following facts regarding this claim: The Kempema claim involves about 56 acres situated on Susbauer Road, north of Cornelius. The claimant acquired this property in 1973. It is currently located in an EFU district and has one dwelling on the property. The proposal is to divide the property into approximately six lots and construct five additional dwellings. It is possible that the claimant would leave one rather large parcel of roughly 46 acres and then the other parcels would be two acres in size. At the time the claimant acquired this property, it was zoned F-1. (This had no minimum lot size.) The claimant estimates loss in value resulting from land use regulations to be $2 million. The claimant estimates loss in value resulting from land use regulations to be $2 million. The Director and staff have determined that the claimant meets the minimum requirements for making a claim. The Board today may either 1) approve compensation or 2) decide to waive certain development regulations. Mr. Brown announced that in this case, staff has issued a revised Staff Report. He said it differs slightly from the one issued a week ago. Mr. Brown explained that the issue relates to whether or not staff recommends modifying regulations or whether staff recommends simply not applying regulations. He specified that in this case, the recommendation is to modify regulations rather than simply not apply them. Mr. Brown explained that the reason for that is staff wants to be clear that the Boards decision in this matter is predicated on the proposal that has been presented by the claimant. He said it should be made clear to the claimant that if he subsequently decides that he would like to do more with the property than what he has initially proposed, he will have to come back for a subsequent decision and a subsequent Measure 37 claim. Mr. Brown stated that the revisions in the revised Staff Report and Recommendation are located on page 5 under the Conclusions. He called attention to a change on page 5, item 1, where the word "potentially" would be inserted so that the text would read "potentially applicable State law requirements include but are not limited to." Mr. Brown recommended modifying regulations of the Community Development Code and listed each of these. (See Staff Report.) He concluded by mentioning that the entire file is available for anyone who wants to view it and that it is a part of the record in this matter. The public hearing was opened. Harvey Kempema, 22484 NW Dogwood Street, Hillsboro, Oregon, told the Board that he is unsure at this point how he will divide the property. He reported that three years ago, Metro tried to buy 39 acres from him. Mr. Kempema stated that Metro owns a 10 acre piece of land to the west of his property, where blackberries are growing at the present time. He believed that Metro desires his 39 acres for blackberries also. Mr. Kempema was very happy to see Measure 37 pass. He related that his original intent for dividing his property was five 10-acre parcels and one six-acre parcel. Mr. Kempema wished to leave open the matter of how he actually divides this up. For example, if a neighbor brings a water system to the area, Mr. Kempema planned to tap into that and make smaller lots. He reiterated that he is delaying final decisions about how to divide his land based on how the market plays out. Mr. Kempema speculated that Metro may try to buy his land again and said they would have to pay for it this time rather than allegedly trying to steal it last time. He asked the Board to approve his claim. Virginia Steele, 3285 NW Susbauer Road, Cornelius, Oregon, testified in opposition to this claim. She indicated that she lives directly west of Mr. Kempemas property. Ms. Steele reported that she owns and operates a nursery there, with 50 seasonal employees and 20 full-time employees. She was concerned about right to farm issues. Ms. Steele recalled that her nursery was on SW Lois Street in east Hillsboro for 22 years. She explained that she left that location because the nursery became surrounded by development. Ms. Steele was concerned about changes in the immediate area that will result from the development of Mr. Kempemas property. She planned to submit information at subsequent hearings also. Ms. Steele remarked that if there is any access into Mr. Kempemas property, it should be from Hornick or to the north because Susbauer Road is tremendously over-utilized. The public hearing was closed. Vice Chair Duyck asked if this Measure 37 claim has triggered the clock since the full development potential of this property is not being utilized and there is a two year statute of limitations for the rest of the property. Chris Gilmore responded that the two year statute of limitations runs from the date the County enforced the regulation against the property owner. He affirmed that all of these claims received an enforcement letter and that it would run from the date of that letter. Vice Chair Duyck wanted to know if Mr. Kempema might be turned down if he was to come in for a development application three years from now. Mr. Gilmore clarified that if Mr. Kempema comes in for a Measure 37 waiver three years from now, Vice Chair Duycks statement is correct. Chairman Brian wanted to know when those letters were sent out. Staff replied that the letters were sent out in April. It was moved to adopt the Resolution and Order (with revised Staff Report) to approve Claim 37CL00026. Motion Schouten 2nd Leeper Vote 5-0 5. LAND USE AND TRANSPORTATION

5.a. MO 05-152 Authorize Filing of Land Use Ordinances to Amend the Comprehensive Plan (All CPOs) Brent Curtis summarized that as part of the Work Program each year, the Board directs the prioritization of items. He reviewed that several issues have been under continual evaluation by staff. (A one-page summary of issues and associated recommendations was distributed and may be found in the Meeting File.) Mr. Curtis recalled that the Issue Papers were originally presented to the Board on April 26, 2005, at which time staff received authorization to distribute to distribute these to the public. He said that staff was to return today with the publics comments and to respond to any additional Board questions. Mr. Curtis advised the Board that no written comments have been received from the public but that one telephone comment was received from Mary Manseau of CPO7. (Ms. Manseau originally brought up questions about clarifying issues associated with open space.) He reported that her telephone message expressed her support for the issues being examined via staff analysis. Mr. Curtis stated that, overall, staff is recommending that the Board allow staff to file ordinances to address these issues. He indicated that there are four Issue Papers: Issue Paper No. 1: Staff requests to file an ordinance that would clarify what land use features should qualify as open space for land development applications. Issue Paper No. 1B: Staff requests authorization to file an ordinance that would amend the Community Development Code to clarify 1) the process for revising an approved master plan, 2) what density standards apply for calculating minimum residential densities on lands added to the UGB by Metro, and 3) what types of open spaces can be excluded for purposes of determining minimum residential density. Addendum to Issue Paper No. 10: Staff requests authority to file an ordinance to allow staff to amend the Community Development Code to clarify existing provisions regarding plan development for recreational facilities and open space. Issue Paper No. 20: Staff requests authorization to file an ordinance which would 1) amend the Comprehensive Plan to add uniform definitions of open space and clarification language as to the purpose and function of open space and 2) to amend the Comprehensive Framework Plan and the Rural Natural Resource Plan to add implementing strategies clarifying how to add and remove existing significant natural resource designations through the plan amendment process. Mr. Curtis commented that all of these issues are analyzed in detail in the Issue Papers. He noted that they all revolve around questions about open space, recreation and the like. Mr. Curtis has discovered that there is a compelling interest in these issues in the community and that while it might be beyond what was originally intended, staff might be well suited to get into all of these issues. He therefore recommended authorizing staff to file ordinances to perform that work this year. Commissioner Leeper commended CPO7 for submission of the data and for persistence in following up on it. He also praised Brent Curtis and staff for this work. Commissioner Leeper believed that the clarifications being sought are most timely, if not possibly long overdue. He encouraged staff to work on this, shortly after work has been completed on North Bethany. Brent Curtis stated that North Bethany will be a big, involved, elaborate planning process. He thought that the issues being explored and clarified in these plan amendments will help that planning process. Mr. Curtis felt that staff could advance the North Bethany planning issues at the same time staff prepares these ordinances. He clarified that the intent would be to take these at the same time rather than to take them sequentially. Commissioner Leeper commented that North Bethany issues are near and dear to his heart and he was pleased staff will work on them jointly. Mr. Curtis remarked that staff remains tremendously interested in doing the North Bethany work. He characterized it as complicated and interesting, as well as important to the Board. It was moved to authorize the filing of ordinances to make the necessary amendments to the Comprehensive Plan as recommended in Issue Papers 1, 1B, and 20 and in the Addendum to Issue Paper 10. Motion Duyck 2nd Rogers Vote 5-0 6. COUNTY ADMINISTRATIVE OFFICE

6.a. MO 05-153 Approve Proposed 2005 Strategic Investment Program (SIP) Agreement between Washington County and Intel Corporation This item will be considered at a joint public hearing between the Washington County Board of Commissioners and the Hillsboro City Council at 6:00 p.m. this evening at the Hillsboro Civic Center. Please see separate sets of Minutes for a summary of the joint public hearingone set for the Washington County Board of Commissioners and one set for the Hillsboro City Council. 7. ORAL COMMUNICATION

None. 8. BOARD ANNOUNCEMENTS

None. 9. RECESSED: 11:42 a.m. Motion Rogers 2nd Schouten Vote 5-0

MINUTES JOINT MEETING WASHINGTON COUNTY BOARD OF COMMISSIONERS AND HILLSBORO CITY COUNCIL MAY 17, 2005 RECONVENED: 6:07 p.m. BOARD OF COMMISSIONERS: Chairman Tom Brian Vice Chair Andy Duyck Commissioner Dick Schouten (Recused) Commissioner John Leeper Commissioner Roy Rogers (arrived 6:17 p.m.) CITY COUNCIL: Mayor Tom Hughes Councilor Ed Dennis Councilor Joe Keizur Councilor Doug Johnson Councilor Nenice Andrews Councilor Cynthia ODonnell Councilor Michael Castillo (Recused) STAFF: Charles D. Cameron, County Administrator Dan Olsen, County Counsel Ellen Conley, Senior Deputy County Administrator Dennis Mulvihill, Intergovernmental Relations Specialist Gerald Kubiak, Government Affairs Assistant Michelle Pimentel, Senior Program Educator Jerry Hanson, Director, Department of Assessment & Taxation 6. COUNTY ADMINISTRATIVE OFFICE

6.a. MO 05-153 Approve Proposed 2005 Strategic Investment Program (SIP) Agreement between Washington County and Intel Corporation Mayor Hughes welcomed the Board to the City of Hillsboros new Council Chambers and turned the meeting over to Chairman Brian. On behalf of the Board, Chairman Brian thanked the Hillsboro City Council for hosting this joint meeting and spoke of the pleasure of convening in such a nice facility. Commissioner Schouten made the following declaration: "Mr. Chairman, as the first order of business, I wish to declare an actual conflict of interest as that term is defined by Oregon law. My spouse is employed by Intel Corporation and her compensation provides more than 50% of our household income. In addition, she receives stock options and we own Intel stock. Accordingly, I recuse myself from any participation in this matter. I do intend to take a seat in the audience to observe, but will not participate in any way." Both the County and City opened the joint public hearing on this matter.

Chairman Brian reviewed the ground rules for this evenings hearing: Staff Report (County) Intel Presentation Questions from City Council and Board Public Comment (Three minutes per person) Response to testimony or requests for clarification by elected officials County and City close public hearing Deliberation County will take action and adjourn its meeting City will consider action and then resume its regular meeting STAFF REPORT Charles Cameron, who was accompanied by Ellen Conley, narrated a PowerPoint presentation. He first provided background information pertaining to the Strategic Investment Program agreement between Washington County and Intel Corporation. Mr. Cameron reviewed that the 1993 State Legislature created the program to increase Oregons competitiveness and modernize its economy. He recalled that Washington County and Hillsboro were having great difficulty in landing critical employers as a result of the antiquated Oregon property tax system. Mr. Cameron indicated that the State Legislature addressed that and gave local government the option to make adjustments in order to bring equity and fairness to the system. He explained that the legislation addresses the peculiar capital-intensive nature of the high-tech industry. Mr. Cameron stated that it limits to $100 million the amount of taxable property and requires the annual payment of a community service fee equal to 25 percent of the abated taxes. (In every case, it has been up to $2 million per year.) He mentioned that additional fees can be negotiated but are not required. Mr. Cameron listed a variety of types of property tax abatements, which included business inventory, farmland, forest, crops, animals, machinery relating to agriculture, and the Strategic Investment Program in enterprise zones. Relative to Intels Strategic Investment Proposal for 2005, Mr. Cameron stated that it is essentially a continuation of the 1999 SIP. He commented that it will have a ceiling of $25 billion and a time period over 15 yearsroughly 2010 to 2025. (There are opportunities for an early or late start from 2007 to 2028.) Mr. Cameron reported that the emphasis is on re-tooling facilities. He noted that the high-tech industry is, if not the most capital-intensive industry in the United States, certainly among the leadersparticularly in the Washington County application, given the research and development emphasis. Mr. Cameron specified that new technology, in many cases, has a shelf life of two to three years. He said that another feature of the proposal focuses on retaining current jobs. Mr. Cameron communicated that the goal is to maintain a vibrant, productive work force. He clarified that the proposal features limited job growth1500 jobs over the life of the agreement. Mr. Cameron anticipated limited demands on public services. He felt certain that the agreement would maintain Oregon as a key research and development site as long as those investments are made. As to why Intel applied for this, Mr. Cameron explained that business pays property tax on equipment as well as land and buildings. (Residential taxpayers do not pay property tax on personal property, such as furnishings and equipment.) He stated that the focus of this application proposal is on the equipment. Mr. Cameron related that the overwhelming amount of the $25 billion invested would be on the equipment side; this is the focus of the agreement. He said that approval of the SIP would limit the property tax on that equipment and keep Oregon competitive. Mr. Cameron reiterated that Intel would pay the full rate on land and buildings and that any equity adjustments would be made on the equipment. He displayed a chart illustrating the disparity between the U.S. average capital investment per employee with regard to nationwide manufacturing versus what Intel spends. Mr. Cameron reviewed the key elements of the agreement: All land and buildings will be fully taxed at the conventional, appropriate rate. The equipment will be taxed at a reduced rate. There will be additional guaranteed payments beyond the statutory requirements. The sum of this agreement is that total taxes and the in lieu payments that are incorporated in the agreement are twice what the Oregon Strategic Investment Program requires. Mr. Cameron provided these statistics: Property tax on the first $100 million amounts to $28.8 million. The community service fee is $30 million. He specified that these are the limits of the statutory requirements. Mr. Cameron said that in addition to that, the State and County negotiated the remainder: A guaranteed annual payment of $28.7 million. There will be an in lieu fee of $27.2 million. There will be a charitable payment of $600,000 ($100,000 per year for the first six years of the agreement, which will start this current year). Mr. Cameron related that Intel currently pays $1,720 per employee under the Strategic Investment Program and pays $3.48 per square foot. INTEL PRESENTATION

Steve Grant, Vice President, Technology and Manufacturing Group, Intel, said that he has responsibility for Intels manufacturing facilities worldwide. He was proud to call Oregon home and privileged to ask the Board and Council to approve a new Strategic Investment Program with Intel Corporation. Mr. Grant recognized that this extension of collaboration could have profound, positive impacts on the community for decades to come and looked forward to maximizing these benefits. He felt fortunate to have had the successful experience of previous agreements, which have laid the foundation for tonights decision. Mr. Grant reviewed that Intel came to Oregon in 1974 for the excellent quality of life, the proximity to Silicon Valley, the skilled workforce, and much more. He observed that Intel was a different company then; the microprocessor was just invented in 1974 and the personal computer was just an idea. Mr. Grant noted that the changes witnessed in the decades following Intels arrival could not have been predicted. He said that from the beginning, all parties worked together to achieve a common vision for Intel in the community. Mr. Grant said that by the early 1990s, the semiconductor industry had become the most capital-intensive industry in the world. He explained that Intel no longer had the luxury of investing at sites where the disproportionate tax burden on capital equipment had not been addressed. Mr. Grant divulged that Intel was facing the end of investment activity in Oregon before the State created the Strategic Investment Program. He reflected that passage of the SIP in 1993 started the most important phase of Intels history in Oregon. Mr. Grant said that the signing of the SIP agreement in 1994 set the stage for a remarkable transformation of Washington County and Hillsboro, which elevated Intels position in the global economy. He commented that today, Hillsboro is not only Intels technology center but also is regarded as the world center for seimconductor research and manufacturing. Mr. Grant reported that almost half of the patents that come out of Intel come from this Oregon site. He characterized tonights action as a major step to ensure that Hillsboros leadership into the 21st century industry continues for future generations. Mr. Grant pointed out that Charles Camerons report explained the agreement in great detail. He observed that even with the SIP agreement, Intel still pays more than twice the property tax per employee than the average Washington County business. Mr. Grant went on to say that Intel will also continue to effectively pay (through taxes and fees) the full valuation of its land and buildings. He expected the new agreement to continue the success of previous agreements and stabilize the investment climate at the local level in the increasingly competitive global environment. Mr. Grant noted that the economic advantage of Intels presence in Oregon has been widely studied and reported. He emphasized that Oregon gets much more than the economic benefits of the States largest employer. Mr. Grant assured the public that they will continue to have as a neighbor a corporation that is recognized worldwide as the leader in environmental stewardship, support for education and a model corporate citizen. He reported that Intel is one of only six corporations in the United States that issues an annual report of corporate responsibility in accordance with the global initiative. Mr. Grant said that Intel is rated number five for business ethics by Business Ethics Magazine and has been named in the global 100 most sustainable companies by the World Economic Forum. He told the assembly that Oregon Business Magazine listed Intel as one of the 100 best companies to work for in Oregon (March, 2005). Mr. Grant indicated that the corporation has also received over 60 environmental, health and safety awards since 1998. He provided assurance that Intel strives at all times to exceed standards and to lead initiatives to reduce environmental impact. Mr. Grant believed that Intels commitment to education is widely recognized by the community. He reported that in 2004, Intel contributed $4.8 million to education and community-based organizations in the form of both cash and equipment. Mr. Grant said that one in seven Intel Oregon employees volunteered in local schools and went on to say that employees contributed a record $1.8 million to United Way (dollars which were matched by the Intel Foundation). He spoke of Intels desire to work hard in order to be a good corporate citizen. Mr. Grant hoped to help create an environment where children today and in the future can succeed. He noted that this is why it is important to continue the SIP agreements because they have worked and laid the groundwork for the future. Mr. Grant was optimistic that this new agreement would lead to an even better future in Oregon. He reflected that this may be the most important economic development event in the United States this year. Mr. Grant was not aware of any other corporation in any other city asking for the opportunity to invest $25 billion in one location. On behalf of Intel employees in Oregon, Mr. Grant urged the Board and Council to approve the Strategic Investment Program. He thanked each body for all the hard work which has made this agreement possible. At this time, Chairman Brian asked Commissioner Rogers (who had arrived a few minutes late due to traveling from a Eugene meeting) if he had any conflicts of interest which would prohibit him from participating in the balance of the hearing. Commissioner Rogers said that to his knowledge, none of his investments are in Intel stock, including anything in any retirement account or portfolio. He therefore did not have any conflicts. The public hearing was opened. Richard Kidd, Mayor, City of Forest Grove, Oregon, testified that his city does not receive direct tax or "in lieu of" money from Intels SIP. However, he recognized that his city does receive a lot of economic interest from Intel. Mayor Kidd acknowledged that Intel needs certainty in order to plan for future business decisions regarding their business mode. He said that certainty is essential for any business to succeed in a global economy. Mayor Kidd wanted Intel to have that certainty for a long period of time. He felt that approving the SIP tonight would provide Intel with that certainty. Mayor Kidd hoped that this agreement would keep Intel in Washington County, Oregon and give Intel the incentive to bring more new technology to this region through research and development. He urged the Board and Council to approve the Intel SIP agreement tonight. Mitch Besser, 17380 Marjorie Avenue, Lake Oswego, Oregon, represented the Oregon Association of Technology Professionals. He spoke against the proposal and posed a number of questions. Mr. Besser referenced an article in the Oregonian regarding Hillsboro class sizes and quoted an Intel attorney as stating, "We expect that we will continue to sponsor H1B employees in the future for the simple reason we cannot find enough U.S. workers with the advanced education, skills and expertise we need." Mr. Besser questioned how the SIP agreement helps public schools produce qualified engineers. He stated that the Oregonian article reported that there is no money earmarked for the schools. Mr. Besser referenced a form he received from Worksystems, Inc. and asked how this ensures Title 7 will be enforced. He wanted to know how Section 3.B. from the previous SIP agreement will be enforced, i.e., "the employer agrees to give first consideration to Washington County residents when they are available and qualified for positions." Mr. Besser asked why the $600,000 given in charity has not been discussed and why this money is not going to the general fund so that it can go through budgetary and procedural regulations. He wondered if the Board and Council are aware of a report he wrote in 1993, which contains information from the Department of Labor demonstrating that Intel systematically pays people of foreign national origin less than the prevailing wage by its own admission. Chairman Brian said that there cannot be a dialogue with testimony but asked staff and Intel representatives to monitor these questions in the event there is an opportunity later in the meeting to respond. Jack McGowan, Director, SOLV, 15909 NW Logie Trail, Hillsboro, Oregon, identified SOLV as the largest volunteer non-profit in the northwest. He reported that in the past year, SOLV engaged over 95,000 Oregonians in volunteer opportunities. Mr. McGowan spoke of the importance of partnershipssuch as the one between Intel and Washington Countycontinuing. He said that it is a fine thing for a company to invest and employ workers but even better for that company to enhance the quality of life in the community. Mr. McGowan believed that Intel exemplifies the finest in partnership between a company and its community. He provided numerous statistics to illustrate Intels involvement in the community, particularly with SOLV. Mr. McGowan reported that Intel also provides monetary help to SOLV and many other Oregon non-profit organizations, which has an astronomical multiplying effect. He mentioned that Intel serves on SOLVs Board of Directors. Mr. McGowan heartily endorsed Intels SIP. Bruce Schaefer, Director, Industry Affairs, Chancellors Office, Oregon University System, 18640 NW Walker Road, Beaverton, Oregon, told the Board and Council that this body does not take positions on public matters and wished therefore to provide factual information. He said he also serves as Executive Director of a statewide planning council called Etech, which strives to improve engineering education around Oregon. Mr. Schaefer described many programs, which Intel sponsors and/or contributes greatly to both in terms of money and volunteerism. He stated that Intel ensures that programs for students are high quality by underwriting new course development and equipping labs through a fellowship program. Mr. Schaefer summarized that Intel makes a wide variety of contributions to Washington County and to the State. Commissioner Rogers appreciated hearing from someone in the academic community. He recognized that there has always been a question of how many engineers Oregon turns out and how much it has in terms of a pool of talent. Commissioner Rogers asked Mr. Schaefer to respond to critics who believe Oregon is not doing a better job of educating more engineers in the state to stay in firms such as Intel. Mr. Schaefer observed that the economy has shifted from primarily forestry/tourism/agriculture to a large proportion of technology industries, including Intel. He said that all industries now employ technology workers in order to be competitive and efficient in the local and global economies. Mr. Schaefer reflected that until eight years ago, Oregon was flat on its production of engineers in terms of graduates and that companies were forced to go out of state. He said that through a strategic plan with Etech, if capacity is doubled it will still be well short of what Oregon needs and that talent will continue to need to be imported. Mr. Schaefer envisioned catching up eventually but said there is a long way to go before enough opportunities can be provided for Oregonians. Marcello Napolitano, 6675 SW Burwick Road, Hillsboro, Oregon, testified that he worked for nine years in the semiconductor industry as a process engineer but that he no longer is employed in this field. Based on his experience in Texas, where he was involved in decision making for selecting new plants, he believed that tax incentives are not a big component of this decision. Mr. Napolitano stated that the cost of equipment is the largest component of the value that comes out of a manufacturing plant in the semiconductor industry. He calculated that the value to the company for tax incentives is one or two percent of the value of the equipment. Mr. Napolitano said that many other factors are significantly more important. He did not believe that tax incentives are a key component in locating a plant. Mr. Napolitano was not in favor of the SIP agreement. Rick Van Beveran, 2858 NE Jackson School Road, Hillsboro, Oregon, could not envision the future of Hillsboro, Washington County or Oregon without the sustaining presence of corporations like Intel. He identified himself as a small business owner who has directly benefited from Intels presence. Mr. Van Beveran was aware that many people benefit from the ripple effect of Intel. He divided the community into two groups: those that benefit directly from Intels presence and those that dont know that they directly benefit from Intels presence. Mr. Van Beveran felt that a compelling technical case has been made for the SIP agreement by previous speakers. He urged the Board and Council to vote in favor of it. Mr. Van Beveran wanted his children to know that they are in a future-oriented community and he believed that Intel does that for this area. Karen Cressa, 605 SE 20th Court, was not opposed to the SIP but wanted the agreement to be "tweaked". For that reason, she asked the Board and Council not to vote on this tonight. Mrs. Cressa said she has not seen the important issue of funds for air monitoring addressed. She did not wish to accuse Intel or any factory of polluting the air but pointed out that this is not really known. Mrs. Cressa mentioned that she attended a DEQ permit hearing three years ago for Intel. She said she assumed DEQ monitored the air physically but learned that it is done by computer modeling. Mrs. Cressa emphasized that she does not breathe computer modeled air but rather real air. She wanted this air to be tested to see what is in it. Mrs. Cressa was aware that Intels factories emit hazardous air pollutants and wished to be assured that health is guaranteed for the future. Jerry Cressa, 605 SE 20th Court, told the Board and Council that he and his wife (the previous speaker) have had a long journey the past four years learning about Oregon and the environment, particularly the regulators of it. He said that when the latest SIP came up, he brought up information about the Intel global world. Mr. Cressa reported that the issue about environment appears to be silent in Oregon. He related that he was told that if other parts of the country or world are having problems with the air, it is not Oregons problem. Mr. Cressa learned at the meeting mentioned by his wife that there is no funding or authority to use real data as opposed to the computer modeling to monitor air. He saw this as the perfect opportunity for the government and Intel to set an example by gathering real data for the health of the residents of Washington County. Mr. Cressa said this would also provide an example for the semiconductor industry. He noted that charitable contributions were "tweaked" into the agreement and asked that funds for an air study be added also. Mr. Cressa asked the Board and Council not to vote on this agreement tonight. Betsy Murphy, 12335 SW Bowmont Street, Portland, Oregon, told the Board and Council that she manages the Streets of Tanasbourne. She spoke in favor of the SIP for several reasons. Ms. Murphy described the crowd on a rainy Tuesday in one of her small, independently-owned restaurants and attributed a lot of this to Intel employees. She reported that many of her stores are surpassing their goals and that she is at about 99.5 percent leased. As a representative of the merchants on the Streets of Tanasbourne, as a resident of Washington County, and as a representative of Oregon, Ms. Murphy supported the SIP agreement. Betsy Biller, Assistant Superintendent, Hillsboro School District, 3083 NE 49th Place, Hillsboro, Oregon, read a letter into the record on behalf of the seven Washington County school districts and the ESD Superintendent. She characterized the SIP as a powerful tool in recruiting and retaining the large, high-tech, capital-intensive investment in Washington County. Ms. Biller reviewed that the School District was favorable toward the approval of previous SIP proposals and is favorable toward the approval of the most recent Intel SIP application. She reviewed that the day to day operational funding for local schools comes primarily from State income tax. Ms. Biller recognized that Intels investments continue to be beneficial in this regard. She said that under the current and proposed SIP, Intel is scheduled to pay property tax at a rate of 2-3 times more than other employers. Ms. Biller believed that the long-term well being of the community depends on a strong economy. She stated that schools have a strong role in this effort by providing a foundation of education for youth and preparing them for active participation in a global economy. Ms. Biller acknowledged that SIP has been of great assistance in nurturing Washington Countys economy. She was grateful for the continued generosity of Intel to Washington Countys school districts. Ms. Biller recalled that Intel gave $1.8 million last year to local schools in the Countyover and above the SIP payments. She agreed with Intel that it should not dictate to the County how to distribute SIP revenues. However, Ms. Biller submitted that a robust economy in Washington County relies on healthy school systems. She stated that school districts work with staff of the city and county every day to benefit youth. Ms. Biller concluded that Washington County school districts, the City of Hillsboro, and Washington County all have a legitimate need to equitably share the SIP-generated revenues. She observed that Washington County has demonstrated this partnership in allocating $24.4 million out of the $44.7 in SIP payments collected since 1994 to Washington County school districts. Ms. Biller said that these payments have been extremely helpful to the operation of the schools and she looked forward to receiving the payments from the continued 1994 SIP agreements and the $500,000 per year payment from SIP 1999. Additionally, she appreciated the anticipated extension of the SIP 1999 allocation to schools. Ms. Biller identified SIP as a tool for nurturing and shepherding a healthy economy and an educated workforce. She stated that there are no SIP funds unless Intel continues to invest in extremely expensive manufacturing facilities. Ms. Biller looked forward to successful deliberations as Intels current SIP application is considered. Chairman Brian indicated that any written materials submitted tonight will be part of the record for the public hearing. He added that communications received prior to tonights hearing are in files either at the City of Hillsboro or at Washington County and are open to the public for examination. Richard Webbs name was called but he did not come forward at this time. Sharon Cornish, P. O. Box 312, Hillsboro, Oregon, was opposed to the SIP. She was not sure the procedure is fair or if it follows law and ethics. Ms. Cornish did not know why the school is not involved in this. She envisioned a void in this regard and considered it unfair. Ms. Cornish recalled that Intel received a lot of SIP money in the past and that Intel employees children are still going to local schools. She concluded that the city and county get a bigger piece of the pie now. Ms. Cornish perceived a conflict of interest with city government. She testified that the city built the Hillsboro Civic Center and bypassed the vote of the people. Ms. Cornish said she found out that SIP money is paying for that building. She reflected that the county did the same thing in the 1980s and bypassed the vote of the people. Ms. Cornish thought the school should receive its piece of the pie. Deanna Palm, President, Hillsboro Chamber of Commerce, expressed the strong support of the Chamber for the SIP agreement. She recognized the positive economic impact the agreement represents to Washington County, Hillsboro, and the State of Oregon. Ms. Palm spoke of how Intels investment has a multiplier effect beyond calculation. She observed that Intels employees touch the community in so many ways. Ms. Palm described the many ways in which Intel employees contribute to the community and economy. Alan Sohler, 14780 SW Holly Hill Road, told the Board and Council that he does not work or have a college degree. He indicated that he does have an invention, which is owned by Intel. Mr. Sohler recalled working at Intel many years ago, when employees were housewives and technicians. He said that as technology has grown, it has become more difficult to be employed by Intel. Mr. Sohler stated that those in the local area with no degree could not get hired by Intel today. He requested that Intel start a program to train local people to be hired. Mr. Sohler hoped that a letter he wrote about six weeks ago is in the record. He hoped the city and county would negotiate that local high school graduates could enter a program to educate them to work at Intel. Jeanne Carpenter, Communications Workers of America, Local 7901, 3439 SE Caruthers, Portland, Oregon, posed the following questions: As part of the SIP agreement in 1999, Intel agreed to hire locally a certain number of employees via the conduit of Worksystems, Inc. and Washington County. Section IV.A & B calls for the employer to agree to provide Worksystems, Inc. and the County with a summary of hiring for each calendar quarter. At a minimum, the summary will detail the names, social security numbers, dates of hire, and positions hired for all new hires during that quarter and the total number of part-time and full-time employees at the end during that quarter and the total number of part-time and full-time employees at the end of the quarter. For each person hired by the employer for covered positions, the employer agrees to use good faith, reasonable effort to assure that each person hired will submit a demographic/income information form. Did Intel provide the quarterly summary to the County of its hiring for each quarter since 1999 and a summary to this date? If so, what are those figures? Ms. Carpenter e-mailed a request for this information to Commissioner Schouten in April and he forwarded this to an official in city government; she has not yet received a response. Is this information available to the public? Chairman Brian invited Ms. Carpenter to send her question to the County Administrative Office, Attention Charles Cameron. Byron Sun, Senior, Forest Grove High School, testified in favor of the SIP agreement with Intel. He will be the first in his family to graduate from high school on time and to go to college. Mr. Sun said that this is his fourth year in Tech Wizards and his fifth year in Oregon. He was born in Guatemala, a country where technology is not used on a daily basis. Mr. Sun did not know how to use a computer before he came to the United States. He told the Board and Council that Intel made it possible for him to learn how to create his own website. In addition, Mr. Sun said that Intel provides the money to purchase equipment and expensive software. He indicated that Intels program has changed many lives. Mr. Sun urged the Board and Council to vote in favor of the SIP. Chairman Brian offered Mr. Sun congratulations on his goals. Councilor Dennis was proud of Mr. Sun and was sure that Mr. Suns parents must be very proud of him also. Duncan Wyse, Portland, Oregon, thanked the Board and Council for doing more for Oregons economy than any other group. He thought that the city and county have become an economic powerhouse for the rest of the state. Mr. Wyse regarded Intel as critical to all of that. In terms of economic strategy for the state, he recognized Intel as the center of the hub of companies that represent the semiconductor industry. Mr. Wyse said that by securing a long-term agreement, the Board and Council are securing Oregons economic future. Jonathan Schlueter, Executive Director, Westside Economic Alliance, agreed with Mr. Wyses remarks and referred the Board and Council to his letter for his complete testimony. Manuel Castaneda, 3045 SE 61st Court, Hillsboro, Oregon, identified himself as a small business owner who performs landscape work for a large number of Intel employees. He encouraged the Board and Council to approve the SIP agreement for Intel in order to keep the economy going. Dick Stenson, President, Tuality Healthcare, 335 SE 8th Avenue, Hillsboro, Oregon, recommended approval of the 2005 SIP for Intel. He said that the diversification that has resulted from more industry has provided a greater array of things to sell to the rest of the world. Mr. Stenson noted that for the past 25 years, Intel has been the primary driver of this regional economy with its innovative computer products that are sold around the world. He observed that an integral part of Intels success has been an excellent employee compensation and benefit package. Mr. Stenson stated that Intel has tremendously supported the schools with volunteers, technology and grants as well as award-winning stewardship of the environment. He spoke of this opportunity to help Intel invest billions of new dollars in Oregons future vitality and growth. Mr. Stenson believed the proposed Intel SIP to be fair both to the community and to Intel. He commented that the community will continue to receive twice the tax revenues needed to cover the cost of public service provided while Intels tax assessments will recognize the accelerated obsolescence of major capital equipment at the leading edge of the high-tech industry. Mr. Stenson regarded this as a win/win proposal for the community and Intel. On behalf of Tuality Healthcare, he offered unconditional support for the 2005 Intel SIP and its future benefit to the economy, schools, jobs, environment and the communitys general well-being and quality of life. Ruth Matson, 1778 NE 2nd Place, Hillsboro, Oregon, told the Board and Council that she is neutral on the SIP but wants both bodies to think about some things. She wanted to know how often the tanks under Intels plants are emptied and what happens to slag, a cast-off product of making computer chips. Ms. Matson was aware that these contain PCBs and a lot of other toxins. She asked what process is used to ensure that these toxins do not go back into the environment. Ms. Matson knew that tanks have leaked in the past. She wanted this considered before entering into an agreement. Ms. Matson wondered, too, if it affects taxes when the DEQ or EPA monitors this process. Maria Ramirez, Senior, Hillsboro High School, stated that she will be the first to graduate and go to college in her family. She believed that Intel is good for the community. Ms. Ramirez testified that the Tech Wizards program has helped her in science, technology and to prepare to go to college. She added that if it was not for Intel, students would not have the equipment to use for projects. Ms. Ramirez reported that technology is helping Hispanics to get more involved in the community. She was grateful for the knowledge and time provided to students by Intel and urged the Board and Council to vote in favor of the SIP. Mike Driscoll, Portland State University, P. O. Box 751, Portland, Oregon, represented PSUs President this evening. As both an administrator and faculty member in the Department of Electrical and Computer Engineering, he felt qualified to speak to the partnership between PSU and Intel. Mr. Driscoll recalled that when he first came to PSU in 1988, Intel was the first company to step forward to support his research and education through key donations of software and hardware. He reported that his students went on to work at Intel to design the computers being used now and those that will be used tomorrow. Mr. Driscoll said that Intel is committed to supporting PSUs plans to build programs of national distinction and listed these efforts in detail. He commented that PSUs goal is to double the number of engineering graduates in Oregon. Mr. Driscoll stated that Intel is committed to work with PSU to prepare K-12 students for college and work. He expected the partnership with Intel to continue. Jim Craven, 5205 SW Meadows, Lake Oswego, Oregon, represented the American Electronics Association, where he works in the area of legislative affairs. He expressed unanimous endorsement of the SIP agreement on behalf of his Executive Committee. Mr. Craven stated that many of the associations members have direct business relationships with Intel Corporation. He said that Intels continued success in Oregon extends to other high-tech companies in Oregon, the United States and around the world. Mr. Craven perceived a link between Intels success and the fact that entities such as Yahoo and Google are considering bringing resources to Oregon. He praised Intels corporate leadership and the example it sets for the entire high-tech industry, as well as the business community as a whole. Mr. Craven urged the Board and Council to move forward with this agreement and expressed appreciation for efforts in this regard.

Sabino Sardinetta, Executive Director, Centro Cultural, stated that Intel has been a positive addition to Washington County and particularly to the mission of Centro Cultural. He said that since 1999, Intel and Centro Cultural have been partners in an outreach program designed to address the awareness and value of technology among the Latino community. Mr. Sardinetta divulged that Centro Cultural has received five grants from Intel, totaling $103,000with a promise of $60,000 more to come. He indicated that Intel volunteers have supported this outreach program. Mr. Sardinetta believed that Intels ongoing presence is good for the community and region. On behalf of Centro Cultural, he encouraged the Board and Council to support the SIP agreement. Pat McDonald, Manager, Fab 20 Intel Manufacturing Facility, 12734 NW Lilywood Drive, Portland, Oregon, supervised 1,300 employees who make many of the chips that go into wireless notebooks. She described a family history of devotion to Oregon. Mrs. McDonald regarded Intel as a vital part of the state and as a corporation which has made Oregon a better place to live and work. She stated that approval of the SIP agreement will set the stage for Intel to continue to be a vital part of the economy. Mrs. McDonald translated this to mean good jobs for thousands of Oregonians at Intel and other companies in Oregon. She added that it will also mean continued Intel support for education and opportunities for other students. Mike Cook, P. O. Box 243, Vernonia, Oregon, testified that he works in construction. He felt that it is the right thing to approve the SIP agreement. Derrick Kitts, State Representative, said that the Board and Council make it an honor to serve as the representative who represents a majority of the Intel campuses for the state. He regarded the approval of this agreement as a very good thing. Ron Johnson, Vice President, Customers & Economic Development, Portland General Electric, 121 SW Salmon Street, Portland, Oregon, stated that he is also Vice President of the Board of the Westside Economic Alliance. He supported the proposed SIP agreement. Mr. Johnson noted that PGE has previously filed a letter of support from its CEO, Peggy Fowler. Mr. Johnson commented on the impact Intel has had on the regional economy. He regarded Intel as a good neighbor, a good partner and a good corporate citizen. Mr. Johnson observed that Intels values in the area of environmental stewardship are demonstrated by its participation in PGEs Clean Energy Wind Program. He specified that Intel is the biggest customer in this program. Mr. Johnson believed that the proposed SIP agreement strikes a good balance among the various considerations to enable the potential $25 billion investment that may occur under this agreement. He felt that having Intel be a leader of the high-tech cluster is critical to the economic well-being of the community. On behalf of PGE, Mr. Johnson urged the Board and Council to approve this agreement and to send an affirmative message that there is a positive business environment in Oregon. Cece Clitheroe, 3876 SE Bliss Ct., Hillsboro, Oregon, mentioned that she has been in banking for 24 years and that she is currently the manager of West Coast Bank in downtown Hillsboro. She indicated that she is also a Board member of the Hillsboro Chamber of Commerce, a Board member of the Hillsboro Boys and Girls Club, Rotarian, and active in various volunteer opportunities around town. Mrs. Clitheroe testified that there are always Intel employees working by her side in all of the events around town. She stated that her Intel employees working by her side in all of the events around town. She stated that her husband has worked at Intel for ten years and that she is the mother of three teens who have attended both public and private schools in the area. Mrs. Clitheroe said she has witnessed the donations Intel has made to the public and private schools. She spoke of the donations by Intel to the Hillsboro Boys and Girls Club too. Mrs. Clitheroe said that this has made after-school programs possible. She said she has seen the economic growth in her position as a lender which has been a result of the small, local organizations which provide services to Intel. Dan Bloom, 815 NW 229th, Hillsboro, Oregon, expressed a neutral position on the SIP. He was encouraged to hear that Intel has a social conscience. Mr. Bloom hoped this conscience is in proportion to Intels billions of dollars of profit. He noted that industries can disperse and pointed out that what is working good today may not be working well tomorrow. Mr. Bloom wished to promote livability, sustainability, and a social conscience as the way to get over rough spots in the future. Tom Black, 870 NW Garibaldi Street, Hillsboro, Oregon, took a neutral position regarding the SIP. He said that he has worked in construction for over 23 years. Mr. Black regarded it as a good thing to have Intel within the city and county. His concern was with H1B visas and with Intel outsourcing jobs. Mr. Black wondered if a quota will be maintained and regulated. He urged the Board and Council to trust Intel but to verify facts. Katie Eyre, CPA and Tax Principal, BKR Accounting Firm, 511 SE Alder Ct., Hillsboro, Oregon, identified herself as the most recent past chair of the Hillsboro Chamber of Commerce and as a current Hillsboro Planning Commissioner. She recognized that Intel desires to invest in this community and thereby to greatly benefit the cities of the county. Ms. Eyre said that the $3 billion 1994 SIP agreement parlayed into a $12.5 billion 1999 SIP agreement, which is now extending into a $25 billion SIP agreement. She wanted Intel to continue its investment in Hillsboro. Ms. Eyre pointed out that Intel has placed its most advanced campus in the world in Hillsboro. She summarized that Intel is a desired company and that Hillsboro is a desired location. Ms. Eyre said that by agreeing up front that the personal property that Intel requires for operation obsolesces quickly, the parties recognize that the depreciable and tax-assessable life of its property is very short. She concluded that this SIP agreement creates an environment of certainty in which Intel knows the results of its investments regarding property taxes. Ms. Eyre felt that without an environment of certainty, Intel would likely choose another location that is willing to provide more certainty. She stated that the current SIP would provide Intel some peace of mind when making a decision of where, when and how to invest and added that this gives Washington County clear direction on its tax rolls. Ms. Eyre went on to say that the SIP agreement will create many peripheral and supporting businesses. She expected this SIP to get citizens back to work, to increase the employment base, and to increase the employment wage base. Ms. Eyre regarded the honest, up front approach of this agreement as refreshing. She fully supported this SIP agreement. George Mason, Director, Public Relations, United Way, 4131 NE Alameda, Portland, Oregon, stated that while he is personally in support of the SIP, United Way does not take a position on this. However, Mr. Mason was able to report that Intel has been a model corporate citizen. He divulged that last year, Intel was the record-breaking winner for fund raising at the employee level. Further, Mr. Mason related that Intel turned around a four year decline in United Way funding. He summarized that these funds service four countiesClark, Clackamas, Multnomah and Washington. Mr. Mason said that over $2 million from employees of Intel and the Intel Foundation went into United Way in just one year. He spoke of the way in which this ensures that the communities safety net is solid and works. Harvey Matthews, Lobbyist, Associated Oregon Industries, 5039 Riverdale Rd. South, Salem, Oregon, said that his focus is on education and technology issues. He reported that Associated Oregon Industries is Oregons oldest and largest business association, representing over 23,000 companies. Mr. Matthews stated that the members employ over 325,000 of Oregons private employees. He was proud to count Intel Corporation as one of his members. Mr. Matthews reviewed that AOI supported the 1993 SIP, when it passed the Legislature. He recalled that it was born from a frustration with a tax system that punished capital intensive business investment. Mr. Matthews said that it was the intent of the Legislature to create more high-tech jobs with passage of this legislation. He observed that this certainly has happened in Washington County with the Boards and Councils leadership. Mr. Matthews strongly encouraged passage of this SIP agreement. He used a visual aid to demonstrate the importance of Intel and all of the companies that it has spawned. Mr. Matthews expected that this investment that the Board and Council are encouraging would have benefits long into the future. Greg Peden, Portland Business Alliance, 520 SW Yamhill, Portland, Oregon, expressed support for the SIP agreement on behalf of 1,300 member businesses from around the Portland region. He said that last week, he, Mayor Hughes and a number of other business organizations met with the Oregon Delegation in Washington D.C. regarding a variety of issues affecting the Portland region. Mr. Peden thought that no company is more important to this economic region than Intel and that therefore no decision is more important than the one relative to the SIP agreement. He was happy to endorse this action. David Erlandson, Financial Advisor, American Express, stated that he has a small business in Murrayhill, Beaverton. He said that he had the good fortune to gain some Intel clients when he began his business and that he has helped them manage their money over the past twelve years. Mr. Erlandson stated that Intel clients have provide stability for his business and allowed him to be successful. He recalled that Intels stability allowed him to stay in business during the downturn in the late 1990s. Mr. Erlandson noted that Intel actually added jobs when other companies were laying off employees. He hoped that the Board and Council would do whatever possible to make it easy for Intel to invest in the community. Mr. Erlandson believed this would be a good thing for the entire region. Chairman Brian thanked everyone who took the time to testify this evening, as well as those who communicated by other means. The public hearing was closed on behalf of the Board of Commissioners. The public hearing was closed on behalf of the City Council. Councilor Cynthia ODonnell said she had a humorous question, i.e., why Intel was rated #5 rather than #1 by Business Ethics. Steve Grant responded that Intel is always striving to do better. However, he felt good about the #5 rating when considering the thousands of companies surveyed. Councilor ODonnell referenced questions about the Department of Labor and certain funding going to charities, Title VII enforcement, and the school situation. She was in awe of industrial technology. Councilor ODonnell was struck by the Cressa testimony and wondered if funding is put aside for ongoing or new studies regarding air quality. She recognized that so many people have testified in favor of the SIP agreement that there is no question that Intel is good for the region. Councilor ODonnell observed that the question of health just floats away. She favored asking for funds for separate air monitoring. Steve Grant asked a staff person from Intels environmental program to speak about what is in place. Barbara Hecht, Oregon Site Environmental Health and Safety Manager, Intel Corporation, stated that Intel is given an air permit by the Oregon Department of Environmental Quality. She indicated that this contains plant emission levels on eight different criteria. Ms. Hecht explained that Intel is to monitor emissions coming from its sites and that this is done by looking at abatement technology. She said that the DEQ comes in and looks at the testing performed with abatement technology; testing results are then shared with DEQ. Councilor ODonnell wished to encourage funds to be allocated for increased monitoring. With regard to the overall regulatory approach, Charles Cameron noted that it goes without saying that Intel is in compliance with both the DEQ and EPA standards. His understanding was that the existing Ronler Acres permit expires in May of 2007. Mr. Cameron stated that the planning process, which will include a substantial public involvement process, is beginning for that now. He summarized that the chapter is being closed on the existing permit and a new chapterlikely with new standardswill be opened this summer. Councilor Ed Dennis did not support tying the Boards or Councils hands as to where these dollars are going to go at this point. He said that if the Council or Joint Body chooses to make a policy decision down the road to do some additional independent research, then that decision will determine whether general funds or SIP funds will be used. Councilor Dennis preferred not to enter this piece into the negotiation but rather to defer it to a policy decision down the road. Councilor ODonnell reiterated that these studies are important for the future. Ms. Hecht stated that Intel does use the best technology today and has redundancy in it. Councilor ODonnell said that the computer modeling triggered her question. She commented that she has other questions, which she will speak to Intel about after the public hearing. Charles Cameron wished to respond to questions raised during testimony regarding school funding, training and workforce environment. He explained that what is being discussed this evening is the revenue side of the equationwhat tax structure will be applied to Intel. (This will not begin any sooner than 2008 or 2013 when payments are made.) Mr. Cameron specified that the second partwhich is not part of Intels agreementis what tax recipients do with the money that comes in. He acknowledged that a variety of suggestions were offered this evening. Mr. Cameron clarified that this is the second part of the process. He pointed out that the agreement this evening does not contain any expenditure requirements for the money. Mr. Cameron stated that this is something for the family of local governments (including education) to resolve. He indicated that on the County side, it has been the preference to wait until getting close to that reality. Mr. Cameron reflected on what has happened in local government finance and education finance over the last ten years and observed that it would be unlikely anyone could predict how things will be even three years from now. He concluded that this is the reason that the County has decided to defer the expenditure requirements until it is more clear who will need what for what kind of programs. It was moved to approve the 2005 Strategic Investment Program agreement. Motion Leeper 2nd Rogers Vote 4-0 (Schouten recused) Commissioner Rogers reflected on the Strategic Investment Programs inception and development over the years. He characterized the agreement as an investment, as has often been testified to this evening. In response to those who have called for the Board to think about this, Commissioner Rogers assured them that that the County has. He announced that he and Chairman Brianon behalf of the Boardserved as the negotiators with Intel. In this role, Commissioner Rogers spoke of the multitude of graphs and other information that were submitted by Intel as a part of this process. He was pleased with the forthright nature of the data. Commissioner Rogers appreciated all of the concerns expressed as well, due to the importance of closely examining such points. He viewed this as an unique situation because of the short life of Intels equipment. Commissioner Rogers recognized that the unusual obsolescence and wear and tear of Intels equipment is so significant that they warrant this agreement. He acknowledged that this is an investmentnot only in Washington County and Hillsboro but also in Oregon. Commissioner Rogers believed that it has been a good investment. He said he would not vote for this if it was not fair for both sides or had a detrimental impact on the schools or charitable organizations. Commissioner Rogers hoped the relationship would continue on a forthright basis. Commissioner Leeper said that he is most favorably disposed toward the SIP. To his point of view, Intel offersand has offered in the pasta many-faceted array of complimentary things they do for the community. He could not imagine that Intels corporate structure would change in the future in such a way as to reflect adversely on his favorable thoughts. Commissioner Leeper commented on the taxes Intel pays, both as a corporation and as individual employees. He praised all of the volunteer work done by Intel employees as well. As to Intels perspective on the environment, Commissioner Leeper had had the opportunity to tour Intel facilities and to pursue subjects related to environmental issues. He reported that on the tour, Intel explained that they have two (possibly three) systems to assure that the environment is appropriately taken care of and addressed. Commissioner Leeper wholeheartedly supported the SIP agreement. Chairman Brian stated that the Boards first obligation is the best interest of the communitynot any single company, group or individual. He indicated that the Board started from that perspective in examining and discussing the potential expansion of the Strategic Investment Program. Chairman Brian said that the Board attemptedthrough negotiationto obtain the greatest amount of advantages to the community that could reasonably and fairly be acquired. He felt responsibility to the 1,500 Intel employees and for all of the other families in Washington County in terms of their jobs, homes, and schools. Chairman Brian said it is the Boards goal to better the future for the Countys children and businesses. He noted that the County is still taxing Intel at full rate on land and buildings; the negotiated equity goes just to the manufacturing equipment. Chairman Brian believed that these investments would not be made if the County does not take advantage of this opportunity to modify the tax structure. He reviewed that this has been done over time in Oregon. Chairman Brian recognized that it does not make sense to apply a standard property tax to this kind of equipment. He felt that the negotiated package does create these investments and increases the changes of having other investments. Chairman Brian referenced tonights testimony as covering all of the direct and indirect benefits associated with Intels presence here. He supported the agreement and felt that the community should celebrate it. Chairman Brian observed that communities across the nation would be ecstatic to have this corporation in their neighborhoods. He characterized Intel as a world center of research and manufacturing. Chairman Brian stated that this has had a profound impact on the city, county and state. As the owner of a small business, Vice Chair Duyck was keenly aware of some of the problems with capital-intensive businesses. He commented that as intense as the capital investment is in his own business, it is nowhere near what Intel is experiencing. Vice Chair Duyck waited for the Legislature to fix the problem of taxes on personal property and on equipment that companies invest in (which creates jobs). While he waited for that, he recognized that there is a problem that needs to be addressed and noted that it is being addressed tonight with this agreement. Chairman Brian thanked Mayor Hughes and each member of his Council for hosting this joint meeting this evening. ADJOURNED : 8:34 p.m. Motion Rogers 2nd Leeper Vote 4-0 (Schouten recused) Please refer to the City of Hillsboro Minutes for the Councils subsequent deliberation and vote on this matter.

Washington County Phone: 503-846-8681 Administrative Office Fax: 503-846-4545 155 N First Avenue, Suite 300 E-Mail: [email protected] Hillsboro, OR 97124