Silicon Forest Interchange Modernization Us Highway 26 / Brookwood-Helvetia

APPLICATION TO THE U.S. DEPARTMENT OF TRANSPORTATION TRANSPORTATION INVESTMENT GENERATING ECONOMIC RECOVERY PROGRAM FOR FISCAL YEAR 2012 Solicitation # DTOS59-12-RA-TIGER4

SILICON FOREST INTERCHANGE MODERNIZATION US HIGHWAY 26 / BROOKWOOD-HELVETIA

Unlocking the Economic Potential of North Hillsboro as a Hub for Business & Commerce

CITY CONTACT PROJECT WEBSITE Don Odermott, PE http://www.ci.hillsboro.or.us/Administration/TIGERGrant.aspx 150 E. Main St. Hillsboro, Oregon 97123-4028 Ph: 503.681.6451

SILICON FOREST INTERCHANGE MODERNIZATION US HIGHWAY 26 / BROOKWOOD-HELVETIA

TABLE OF CONTENTS I. Project Description ...... 3 II. Project Parties ...... 7 III. Grant Funds and Sources/Uses of Project Funds ...... 7 IV. Selection Criteria ...... 8 A. Long-Term Outcomes ...... 8 1. State of Good Repair ...... 8 2. Economic Competitiveness ...... 10 3. Livability ...... 14 4. Sustainability ...... 15 5. Safety ...... 17 B. Job Creation & Near-Term Economic Activity ...... 18 C. Innovation ...... 24 D. Partnership ...... 25 E. Results of Benefit-Cost Analysis ...... 26 V. Project Readiness & NEPA ...... 30 VI. Federal Wage Rate Certification ...... 32 VII. Changes to Pre-Application ...... 32

WEBSITE APPENDICES: http://www.ci.hillsboro.or.us/Administration/TIGERGrant.aspx Benefit/Cost Analysis NEPA Documentation Support Letters Local/Regional Planning Documents

Table 1: SIM Project Key Tasks ...... 7-8 Table 2: Business Opportunities Lost by Hillsboro ...... 12 Table 3: SIM Project Schedule ...... 22 LIST OF Table 4: Economic Benefit from Phase I Development ...... 23 TABLES Table 5: Net Economic Benefits of SIM Project Construction ...... 28 Table 6: Benefit Cost Analysis of SIM Project ...... 29 Table 7: NEPA and Permit Timeline ...... 30-31 Figure 1: SIM Project Budget ...... 4 Figure 2: Aerial View of Current Brookwood/Helvetia Interchange at US-26 ... 5 Figure 3: The Missing Link in the Hillsboro Competitiveness Equation ...... 6 Figure 4: SIM Project Road Improvements ...... 8 Figure 5: Traffic Backed up around SIM Project...... 9 Figure 6: Rendering of Intel’s D1X Fab Plant ...... 11 LIST OF Figure 7: The SIM Project—Keeping Quality Jobs in the U.S...... 12 FIGURES Figure 8: Hillsboro North Industrial Area-Major Companies ...... 13 Figure 9: View of Downtown Hillsboro ...... 14 Figure 10: Orenco Station Mixed Use Development ...... 14 Figure 11: Amber Glen Planned Transit-Oriented Development ...... 14 Figure 12: AM Interchange Queue 2035 ...... 17 Figure 13: Economically Distressed Areas Served by SIM Project ...... 18 Figure 14: Industry Share of Total U.S. Exports ...... 19 Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Background: The Silicon Forest Interchange Modernization Project (“SIM Project”) will upgrade the City of Hillsboro‟s U.S. Highway 26 / Brookwood-Helvetia interchange (“the interchange”). The interchange is currently a chokepoint constraining future economic growth of high-tech, solar, and bio-pharmaceuticals development in the “Silicon Forest,” Hillsboro‟s technology cluster. The existing interchange was constructed to rural standards and thus limits expansion by existing employers, as well as prospective companies.

BROAD COMMUNITY IMPACT The SIM Project sits at the nexus of city‟s “The primary impact is not just traffic transit-oriented community planning and high congestion and frustration for the employees tech export expansion initiatives. Hillsboro‟s of this high tech hub. The problem runs much sustainable long-term development objectives deeper and impacts the willingness of existing require adequate multi-modal transportation and new companies to expand or locate in infrastructure and strong companies located in Hillsboro – it‟s the very ability of our high close proximity. The interchange serves 12,000 tech companies to ship their products to the of Intel‟s 15,000 employees in Oregon, which is worldwide market.” home to Intel‟s largest concentration of research and production facilities in the world. Intel -Howard Larson, Hillsboro Industrial Broker spearheads Washington County‟s role as the leader in state-wide exports (36% of Oregon‟s export value), and is the largest contributor to making the Portland area the number two export region in the U.S. Hillsboro is also planning and delivering a number of mixed-use, high density projects to provide workers living options close to jobs and facilitate growth of businesses looking to locate in Hillsboro and/or expand operations. The success of these projects depends, in part, on adequate transportation infrastructure, including a modern interchange. Hillsboro‟s businesses need workers to have viable transportation options to reach their jobs efficiently. As these high tech companies create and manufacture next generation products, they must have the capability to quickly deliver components and products to customers in national and international markets. The SIM Project will connect current and prospective high tech businesses and manufacturers to nearby export and distribution hubs, such as the Portland International Airport and the Port of Portland, for shipping and rapid delivery. Overall, the SIM Project will ease current congestion for area businesses and workers, as well as facilitate regional and national economic competitiveness through growth in U.S. exports. The City of Hillsboro requests a Figure 1: SIM Project Budget (in millions) $15M TIGER grant as the final financing element of a $65.65M funding package for the two-phase SIM Project.  Phase I will revamp the interchange and be financed through the following (see Figure 1): o $15M TIGER grant o $23.38M from Oregon Dept. of Transportation (ODOT) o $0.55M from the city.  Phase II will utilize $24.62M in ODOT funds and $2.1M from Hillsboro to complete inter-

change capacity improvements on Brookwood and Helvetia Roads, acquire rights of way, and construct access roads to enable development of the surrounding industrial area.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

In addition to the funding outlined above, the Oregon Legislature recently approved, and Governor John Kitzhaber signed into law on March 19, 2012, legislation that includes $3M to $4M in additional funds for the SIM Project (Senate Bill 1543).1 This funding signals the importance of the Project, and more broadly the Silicon Forrest, to the state‟s economic growth. Based on direct consultation with U.S. Department of Transportation program officers2 and the U.S. Census Map,3 this project qualifies for the rural set aside of TIGER funds. Figure 2: Aerial View of Current Combined, the SIM Project‟s improvements Brookwood/Helvetia Interchange at US-26 will support expansion of Hillsboro‟s existing businesses, unlock the economic potential of over 1,180 buildable acres of newly designated industrial land, and support an estimated 25,000-31,000 additional job for the region by 2035. A TIGER grant would provide the final tranche of funding needed to complete the SIM Project and support the expansion of high-tech industries and jobs critical to Oregon and the U.S. economic recovery, near- and long-term. Transportation Challenges: The interchange (Figure 2) is a critical access point that currently serves the mobility needs of over 25,000 employees of major companies, which include Intel (electronic/computer), Genentech (bio-pharmaceutical), and Solar World (solar panels). These and many other area high-tech and support service companies develop and manufacture products in Hillsboro for sale in the U.S. and to export around the world. Hillsboro‟s geographic location and airport access make the area ideal for tapping Asian markets. A recent study by the Brookings Institution noted that the Portland metro area was the second-fastest growing metro area in terms of inflation-adjusted export value growth between 2003 and 2008, and contributed over 9% of U.S. electronic components exports to China.4 Computer and electronic products, anchored by Intel, accounted for 57% of all exports and 63% of export growth in 2010. The interchange serves the following functions associated with these major industries: Employee commute trips, both by vehicles and bicycles; Freight mobility for raw materials supply and finished product distribution; Travelers and high value, low weight air cargo to and from the Hillsboro Airport, Oregon‟s second busiest airport, a significant share of which pass through this key interchange; and US 26 is a freight gateway to Washington County‟s agricultural and commercial timber land. Without interchange improvements, companies in industrial sectors critical to the economies of Oregon and the U.S. may be forced to expand elsewhere, possibly overseas.

1 Oregon SB 1543: http://www.leg.state.or.us/12reg/measpdf/sb1500.dir/sb1543.en.pdf. 2 See “DOT E-mail on Hillsboro Qualification for TIGER Rural Set Aside” on project website. 3 U.S. Census Map: http://www2.census.gov/geo/maps/urbanarea/uaoutline/UA2000/ua71317/ua71317_04.pdf. See also project website for a map displaying the location of the project on the census map. 4 “Export Nation: How U.S. Metros Lead National Export Growth and Boost Competitiveness.” The Brookings Institution. http://www.brookings.edu/reports/2010/0726_exports_istrate_rothwell_katz.aspx. See Tables 6 and 9.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Economic Opportunity: The SIM Project is the MOVING DEVELOPMENT FORWARD final “missing link” (see Figure 3) in Hillsboro‟s “Oregon has created an industrial lands drive to fully unlock the Silicon Forest to create a program to identify and certify key industrial sustainable market for thousands of quality, well- sites as „project ready,‟ streamlined regulat- paying jobs in a region that includes many ory processes, and leveraged existing and economically distressed communities. The Silicon new infrastructure investments. There are Forest is uniquely positioned to serve as an engine ideal sites that meet global market demands for economic development because of the area‟s in the Hillsboro/Washington Co. area, served existing highly-skilled workforce, nearby by the interchange and supporting road net- universities, land availability, support businesses, work. A TIGER grant would align with local, and an abundant supply of consistently clean water state, and federal efforts, and allow us to add critical to high-tech silica-based manufacturing. large industrial sites of global significance to the state‟s portfolio for job creation.” Figure 3: The Missing Link in the Hillsboro Competitiveness Equation -Tim McCabe, Director, Business Oregon Water & Sewer Silicon Forest Transportation Infrastructure High-Tech Infrastructure Investments Clusters 1180 Acres of -Sewer pipeline Shovel-Ready -$15M TIGER Land and (Finished 2011) -High-Tech -$48M ODOT -10 MG Reservoir (‘04) 25,000-31,000 -Bio-Pharma -$2.65M -15 MG Reservoir (‘13) New Jobs -Clean Tech Hillsboro -80 MG/Day Water Capacity Project Objectives: Expansion of the Silicon Forest area is a key component of local and regional transportation plans5 that focus on protection of critical farm land and the reduction of urban sprawl. The interchange currently operates at 98% capacity, while the overpass lacks bike lanes to connect existing bike infrastructure to the popular Helvetia Hills recreational area, located north of the interchange. Without improvements, traffic will fill up the on-ramps, leading to backups on the highway and congestion on surrounding roads as soon as 2015. The SIM Project will: Increase vehicle traffic capacity Increase access and capacity for existing industry, and Add bike lanes to connect existing planned industrial development expansion roads to company facilities and Allow for future expansion of public transport-ation recreational areas in an area not currently served by TriMet, the Portland Add pedestrian access metro‟s mass transit agency. Rapid Development: Transportation infrastructure upgrades will pair with $113M in recent capital expenditures to improve local utilities – water supply, sanitary sewer capacity, and electrical infrastructure – to accommodate development of these key industrial lands (see §IV-D: Partnership). These coordinated improvements have been focused on preparing this land to be “shovel-ready” so companies can quickly expand, build, and access adjacent marketable industrial land. The remaining constraints on Hillsboro‟s ability to accommodate 25,000-31,000 new industrial sector jobs are limited capacity at the US 26-Helvetia/Brookwood Parkway

5 Metro 2035 Regional Transportation Plan: http://www.oregonmetro.gov/index.cfm/go/by.web/id=25038 ODOT-Region 1 (Portland Metro): http://www.oregon.gov/ODOT/HWY/REGION1/US26_brookwoodpkwy/ Hillsboro Transportation System Plan: http://www.ci.hillsboro.or.us/planning/TransportationPlanning.aspx Hillsboro Draft Bicycle & Pedestrian Capital Improvement Program: http://www.ci.hillsboro.or.us/TUF/documents/BPCIP10-19.pdf

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

interchange and construction of a functional urban multi-modal road network linking the interchange to 1,180 acres of adjacent “shovel-ready” industrial sites. II. Project Parties City of Hillsboro: With a population of 92,350, Hillsboro anchors Washington County, which generates 16.3% of Oregon‟s adjusted gross earnings, 36% of Oregon‟s export value, and contains 14% of the state‟s population. Lying in the Tualatin Valley on the west side of the Portland metro area, Hillsboro is Oregon‟s fifth largest city and home to many high-tech companies that comprise an area known as the Silicon Forest. In addition to robust high-tech manufacturing, healthcare, retail, and agriculture diversify the city‟s economy. With its flat terrain, utility infrastructure, and proximity to major highways, Hillsboro is well-suited for industrial development. It also ranks 2nd nationally in EPA‟s Green Power Community Challenge Rankings for its use of renewable energy.6 As a transportation corridor, Hillsboro is located adjacent to U.S. Highway 26 and is thirty minutes west of Interstates 5 and 84. Tri-Met, the regional transit provider, services Hillsboro with bus and light rail lines, including a 33-mile light rail line linking Portland‟s western and eastern suburbs. The Hillsboro Airport logs more than 200,000 operations annually and provides corporate air services, including some low weight, high value freight cargo services. The Port of Portland‟s Portland International Airport remains the primary hub for distribution of high-tech exports from north Hillsboro, highlighting the critical need for reliable and efficient freight mobility through the SIM Project area to access the Port of Portland facilities. Oregon Department of Transportation: ODOT provides a safe, efficient transportation system that supports economic opportunity and livable communities. ODOT develops programs related to Oregon‟s system of highways, roads, and bridges; railways; public transportation services; transportation safety programs; driver and vehicle licensing; and motor carrier regulation. III. Grant Funds and Sources/Uses of Project Funds TIGER funds will be used solely for Phase I construction activities – to clear existing facilities and construct ramp and overpass improvements (see Table 1) – and not for planning, engineering, or right of way acquisition. 7 Bike lanes and sidewalks will be added on the overpass, and the interchange will be powered by a solar array. Figure 4 below shows the improvements.

TABLE 1: SIM PROJECT KEY TASKS Cost Source Phase I: Construction of Interchange Improvements – $38.93M Demolition and removal of existing Groveland and Jacobson Rd. approaches $15.00M TIGER Add double-lane exit loop ramp Reconstruct and relocate US 26 westbound entrance ramps Widen northbound to eastbound on-ramp to add single right turn lane Construction of re-aligned Jacobson Road $23.38M ODOT Widen Helvetia Rd. for 5 lanes to Jacobson Road Modify existing striping to add second northbound lane Widen over-crossing to accommodate third southbound through lane City of $0.55M Solar array purchase and installation Hillsboro Enhance bicycle/pedestrian access on Brookwood Parkway overcrossing

6 See http://www.epa.gov/greenpower/communities/gpcrankings.htm 7 For a breakdown of fund allocation showing money spent on engineering and right of way acquisition, vs. construction, see “SIM Phase I Non-Construction vs. Construction Expenditures” on project website.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Phase II: Improvements to Industrial Area Arterial Roads – $26.72M Construct re-aligned Groveland Rd. Widen Helvetia Road to Schaaf Rd, including new Waible Creek bridge $24.62M ODOT Construct 253rd Avenue from Evergreen Parkway to Meek Road Remove Meek Road Approach to Brookwood Parkway Construct third southbound lane on Brookwood Parkway to Evergreen Parkway and activate third southbound lane on overcrossing Construct Huffman extension or Schaaf Road and Connector Road or City of $2.10M Century Boulevard link as prioritized by Interchange Management Plan Hillsboro Extend third northbound lane on Brookwood Parkway from Evergreen Parkway to the eastbound U.S. 26 entrance ramp SIM PROJECT TOTAL: $65.65M Figure 4: SIM Project Road Improvements

IV. Selection Criteria A. Long-Term Outcomes 1. State of Good Repair Upgrade Assets that Threaten Efficiency: While the existing interchange and existing arterial roadways and interchange are rated as in good condition, the interchange was constructed to rural specifications 30 years ago, making it ill-suited to serve as a hub for emerging technology companies. The City of Hillsboro has carefully expanded the city‟s urban growth boundary to allow growth in the area around the interchange in order to build on existing hi-tech, bio- pharmaceutical, and solar energy clusters.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

New roadways are critically needed to access adjacent industrial land. Schaaf Road is currently private and gravel-surfaced, while 253rd only exists as public right of way for half of the distance between Evergreen Road and Meek Road, and is only gravel surfaced. The southwestern Huffman Extension and the northeastern connector road, the Schaaf Road extension from the connector road to Century Boulevard, and the gap in Century Boulevard, are all new roads needed to support a complete and connected urban road system linking available flat industrial land to the interchange. The SIM Project would construct necessary transportation capacity improvements and new road connectors to alleviate current roadway capacity and accessibility restrictions constraining long term industrial employment opportunities on existing industrial land and 1,180+ acres of land planned by the state and regional government as a Regionally Significant Industrial Area. This project is included in city, region and state transportation plans. Congestion on the interchange is a significant problem during peak traffic periods (see Figures 5 and 6). In 2005, the Economic Development Research Group prepared a study of Portland-area congestion for the Portland Business Alliance, Metro, Port of Portland, and ODOT.8 The study found: Congestion currently threatens economic growth in the Portland region; Congestion problems are already reducing profits for local businesses; and Failure to invest in the region‟s transportation system could cost the region $844M/yr. Figure 5: Traffic Back up Near SIM Project Morning Congestion – – Evening Congestion, East Bound On-Ramp West Bound Off-Ramp

Traffic Backed up on Intersection (Brookwood Parkway / Meek Road) Traffic Back-up on Arterial Roads

Operations & Maintenance (O&M): Once the interchange is built, ODOT, Washington County, and the City of Hillsboro will supervise active pavement O&M programs. All new construction will be built to a 30-year minimum design loading estimate for pavement and 75 years for structure widening. ODOT will manage Phase I so that long term performance costs are effectively managed through appropriate design and ongoing O&M. ODOT employs a variety of strategies to maximize

8 “The Cost of Congestion to the Economy of the Portland Region” Available: http://www.portofportland.com/PDFPOP/Trade_Trans_Studies_CoCReport1128Final.pdf

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

roadway life-cycle and approaches assets from a system-wide perspective. Phase II improvements by the City would include Portland Cement Concrete as bid alternates, since life-cycle costs of PCC generally outperform asphaltic concrete paving for maintenance cycle costs. Sustainable Revenue: The 2009 Oregon Jobs & Transportation Act provided capital for new projects, including $45M to modernize the SIM interchange.9 The Act also expanded funding for pavement preservation. The new state funding came from increasing vehicle registration and licensing fees, and increasing the gas tax by 6¢. The 2012 Oregon Legislature recently approved an additional $3M to $4M for the project. The City of Hillsboro also assesses a formula-based Transportation Utility Fee (TUF) on residential dwelling units and businesses based on average daily trip generation. TUF revenues augment Hillsboro‟s share of the state gas tax to substantially fund Hillsboro‟s pavement O&M program, plus generate revenues for use on Hillsboro‟s pedestrian and bicycle Capital Improvement Program.10 Washington County has an urban road maintenance district which collects revenue from property owners for repairs. This allows county gas tax revenues to more effectively address rural road maintenance. While not fully funded, both the city and county have been leaders in developing sustainable models for pavement presentation. 2. Economic Competitiveness Hillsboro’s Silicon Forest: Uniquely Positioned for Job Growth: The interchange Driving US Exports11 modernization is the missing piece in unlocking  2nd fastest export-value growth Hillsboro‟s ability to offer “shovel-ready” industrial land area after NYC area to U.S. and international companies looking to create jobs  Largest exporter of electronic in Hillsboro and the surrounding region. While many components to China areas seek to foster economic growth, the Silicon Forest  Metro region doubled value of is uniquely positioned because of its existing highly- exports, 2003-2008 skilled workforce, partnerships with nearby universities, land availability, support businesses, and abundant supply of consistently clean water, which is critical to silica-based high-tech manufacturing. However, rising congestion impairs companies‟ ability to cost-effectively move freight, threatening economic growth. Constricted capacity from the interchange limits existing companies from adding capacity and impedes expansion of new industries in the area. Supporting High-Tech Manufacturing: Multinational industrial manufacturing firms such as TriQuint Semicondutor, Intel, Genentech, TOK America, Tokai Carbon USA, and SolarWorld develop and manufacture products in the Silicon Forest, bringing economic growth to the region and nation. These firms could locate anywhere in the world, but choose Hillsboro for its attractiveness and competitiveness, reflecting the economic efficiencies of “clustering.” The Portland metro area trailed only New York in electronic component manufacturing from 2003- 2008, according to a Brooking‟s Institute study, demonstrating the area‟s unique capabilities.12 It is crucial for the U.S. to provide the tools and infrastructure necessary to foster an attractive environment to establish and conduct business. This helps ensure that innovative products and manufacturing processes developed in the U.S. create jobs here at home. Intel is a prime example. Despite robust competition from manufacturers abroad, particularly in Asia, three-quarters of Intel products are made by U.S. workers. In addition, Intel plans to expand Hillsboro employment by more than 1,000 by 2013.

9 “Jobs and Transportation Act.” Available: http://www.oregon.gov/ODOT/JTA.shtml 10 City of Hillsboro Draft Bicycle and Pedestrian Capital Improvement Program, footnote 3. 11 See Brookings Report, Table 7. http://www.brookings.edu/reports/2010/0726_exports_istrate_rothwell_katz.aspx 12 Id.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Figure 6: Rendering of Intel’s D1X Fab Plant President Obama’s Feb. 2011 Speech at The new plant, which will be operational in 2013, Intel’s Hillsboro Manufacturing Plant is <1 mile from the interchange. It expands Intel‟s largest of seven campuses in the Silicon Forest. “Companies like Intel are proving that the U.S. can compete, that instead of just being a nation that buys what’s made overseas, we can make things in America and sell them around the globe. Winning this competition depends on the ingenuity and creativity of our private sector [and] on what the U.S. … does to make America the best place on earth to do business. Workers at these plants are not just manufacturing high-tech computer chips; they demonstrate how America will win the future.” Similarly, biotech companies are expanding in Hillsboro near the interchange. Genentech, a subsidiary of a large Swiss-owned pharmaceutical company specializing in cancer-fighting drugs, recently began operations at a new manufacturing plant located less than a half mile south of the interchange. Genentech purchased 75 acres of land to allow for future expansion of their campus. Genentech has about 450 employees in the Hillsboro area, with over 100 jobs added within the last year. Acumed, a global provider of innovative orthopedic and medical solutions, is located near SIM project improvements, and anticipates adding 100 new hires over the next three years. The fast paced biotechnology sector relies on access to airports and rail to deliver its products to national and international customers. Hillsboro also recently attracted German-owned SolarWorld to develop the nation‟s largest solar panel manufacturing plant. SolarWorld invested $500M to completely retool a former Komatsu manufacturing building that had sat vacant for years. It now employs over 1,000 workers there. Discussions are underway for a potential new Phase 3 project which could expand campus employment to approximately 2,000 full-time employees. Small, innovative businesses also rely on infrastructure connections for growth. ClearEdge Power recently received a $500M order to export next generation fuel cells to Austria for a project to turn forest waste into carbon neutral electricity.13 The company is located less than a mile south of the SIM interchange and relies on functioning roadways to bring its products to market. It has grown from 33 employees in January 2009 to 150 today and ships cutting edge products across the U.S., Europe, and Asia. While ClearEdge could locate anywhere in the world, strong transit connections will help keep these jobs in the U.S. Missed Opportunities: The SIM Project is critical to making U.S. manufacturing globally competitive. Data collected by the Hillsboro Economic Development Department (Table 2) indicates that dozens of companies have considered locating facilities in Hillsboro during the past three years, but opted for alternative development opportunities – many overseas.14 Given the sensitive nature of the site selection process, definitive reasons for why a particular company chose to locate elsewhere are not available. However, many prospective companies have expressed concern about constricted transportation capacity in the Hillsboro area.

13 See “A „Quantum Leap‟ For Oregon Fuel Cell Company.” http://ecotrope.opb.org/2012/01/a-quantum-leap-for-oregon-fuel-cell-company/ 14 “Hillsboro Lost Business Opportunities.” City of Hillsboro, Internal Memorandum.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Companies need not only office space but also large tracts of Table 2: Business Opportunities Lost by Hillsboro land ready to support manufacturing operations. Hillsboro and Businesses Potential surrounding areas field an average of 25 inquiries per year Year Lost Jobs Lost about the availability of large (50+ acre) parcels. Most such 2009 42 8,400 inquiries come from technology manufacturers in need of “shovel-ready” land for quick scale-up to bring products to 2010 11 815 rapidly evolving markets. While 12% of such inquiries turn 2011 20 5,650 into built projects, the region loses at least 1-2 projects per year due to lack of site availability.15 The city expanded its Urban Growth Boundary in 2010 and again in October 2011 to carefully create new large parcels for development, but the need for adequate service infrastructure remains. SIM Project Solution: For companies to TRAFFIC BLOCKING ECONOMIC GROWTH establish and expand facilities in the Silicon Forest, Hillsboro‟s transportation system “From serving on a committee of high tech companies, I hear repeatedly that manufacturers must keep pace with increasing employee are very concerned about their ability to transport and freight travel demands. If companies products to PDX and the Port of Portland because continue to locate in Hillsboro in a no-build of traffic concerns. Congestion is a serious scenario (interchange construction delayed), disincentive to manufacturing of all kinds.” the area would likely lose large companies —Howard Larson, Hillsboro Industrial Broker that drive U.S. economic growth. Hillsboro‟s no-build projections assume economic growth, albeit diminished growth due to losing large, high revenue companies (See Table 5: Net Economic Benefits). The interchange is a choke point that limits Hillsboro‟s ability to generate job growth. Over the next 20 years, the SIM Project will provide a high return on investment, as shown in Figure 7.16 FIGURE 7: THE SIM PROJECT— Much of the economic growth Keeping Quality Jobs in the U.S. expected from the SIM Project 25,000-31,000 jobs projected in area served by interchange will be in high-tech industries 3.5 add-on Oregon jobs created by each new high tech job that support family-wage jobs that average well above national 520 job years to construct the project and statewide median incomes. $4.9B in added payroll generated from jobs in area unlocked by SIM development by 2035 Broad Economic Impact: The $1.7B in additional higher value business investment by long term economic impact from 2035 with SIM infrastructure future development spurred by $9.7B total in employment payroll and over $2.3B in local the SIM Project is not limited to business capital investment with SIM infrastructure high-tech jobs. Economists High Tech, Clean Tech and BioPharma clusters in place estimate that each direct job U.S., European, and Asian companies site facilities in area created will lead to 3.5 additional indirect jobs throughout Oregon. This includes jobs in manufacturing, education, and the service sector – many of which will be in economically distressed areas. Greater Portland‟s exports support 142,270 jobs. Nearly one-fifth of the Portland metropolitan economy is export-driven, translating into jobs across various sectors. 17

15 See “Metro Region Large Industrial Site Query Survey” on project website. 16 The Benefit/Cost Analysis in Table 4. 17 “Greater Portland Export Plan- Metro Export Initiative.” Brookings-Rockefeller Project on State & Metropolitan Innovation. http://www.brookings.edu/~/media/Files/Programs/Metro/export_initiative/export_initiative_portland.pdf

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Figure 8: Hillsboro North Industrial Area-Major Companies: The Silicon Forest is home to a variety of businesses important to the national economy. Leading companies like TriQuint Semicondutor, Intel, Genentech, TOK America, Tokai Carbon, and SolarWorld often make investment decisions to locate/expand operations based on immediate availability of shovel-ready land and reliable access to markets. The map also shows the SIM project in relation to area employers and high-density, transit-oriented developments.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

3. Livability

Figure 9: View of Downtown Hillsboro HILLSBORO 2020 VISION PLAN Strategies Aligned with SIM Project • Form Integrated Bike Network • Transit System Expansion & Promotion • Renewable Energy Pilot Projects (solar) • Promote housing served by transit • Support Economic Activity Centers • Business Marketing & Recruitment • Family-Wage Job Creation • Become Regional Transportation Leader Greater Housing and Livability Choices: The SIM Project interchange expansion will allow for greater diversification of transport choices for Hillsboro and surrounding communities, including: Preventing a spike in travel times as economic development continues in the surrounding area by allowing uncongested traffic flow even as traffic volumes grow by an expected 50%;18 New on-street bike lanes connecting existing bike lane infrastructure to businesses, residences, and recreational areas north of the interchange; and Laying the groundwork for Tri-Met to add public transportation options to the area. The combined effect of these improvements will be to maintain or reduce the average cost of user mobility even as the area grows economically. Figure 10: Orenco Station Mixed Use Figure 11: Amber Glen Planned Mixed Use Development & Transit-Oriented Development

The SIM project is part of a larger effort to provide livable and sustainable development in Hillsboro through the addition of medium and high density housing options served by expanded light rail and bus service. City and County investments in bicycle, pedestrian, automobile capacity and connectivity improvements compliment the City‟s strategy of providing enhanced mobility options for the community. The SIM Project is located two miles north of Orenco Station, the award-winning New Urbanist community on the westside MAX line. Orenco Station began Hillsboro‟s on-going efforts to build livable mixed use neighboroods near light rail. Within its 260 acre area, Orenco Station mixes 2,200 single family detached and attached units, apartments, and condominiums with over 520,000 ft2 of retail, service, office and medical services, including major retailers at Crossroads at Orenco Station and premium retail space in the Orenco Station Town Center (Figure 10). The station‟s internationally recognized urban design features a

18 See “Average Daily Traffic Projections” on project website.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

comfortable and convenient grid of traditional sidewalks linking the residential and commercial areas with over 10 acres of public and private parks and open spaces. Though most of the area has been developed, a few parcels adjacent to the light rail are now being considered for even higher development intensity, as a “second generation” of livable mixed use projects at Orenco Station. Continuing Hillsboro‟s effort to promote livable and sustainable development is the nearby AmberGlen Community Plan District (Figure 11) , where the City is planning a mixed-use urban community focused on a dramatic central park, served by High Capacity Transit either through extension of the existing Light Rail system or through a new Streetcar system. Residential, employment, shopping, education, and recreation are integrated throughout a high-quality urban and natural environment. Land use policies identify over 6,000 new medium- to high-density residential units; 3 million ft2 of offices; 500,000 ft2 of retail, including shops, restaurants, and entertainment; and over 170 acres of parks, greenways, and natural areas. These developments demonstrate Hillsboro‟s commitment to smart growth and a breadth of transportation choices. See Figure 8 above for the geographic relationship between the SIM project, major employers, and the Orenco Station/AmberGlen areas. Community Participation: To arrive at the design of transportation improvements, planners took into account the desires of community stakeholders, including companies, bicycle groups and civic organizations. The SIM Project grew out of the Hillsboro 2020 Vision Statement & Action Plan, which was developed over a three-year period with extensive public input, and was updated in 2010 (see Figure 9). Over 1500 citizens participated in the community effort via public opinion polls, focus groups, public meetings, workshops, surveys, Web page responses, and other venues to involve community ideas, analysis, and proposal reviews. Hillsboro‟s 2020 Vision & Action Plan19 focuses on the following community goals: Strengthen common sense of community Foster economic opportunity Enhance neighborhoods and districts Expand support for & access to arts/cultural activities Preserve the environment Promote community health and safety This Project is a concrete step toward realizing the livability goals. During construction, ODOT will conduct community meetings and make project information available on its website.20 Improving Access for Disadvantaged Populations: In addition to expanded economic opportunities for disadvantaged residents, the SIM Project will help expand transportation options for communities. Payroll taxes collected from employers fund the majority of operating revenue for Tri-Met. For example, Intel alone pays approximately $13M in payroll taxes to fund Tri-Met‟s yearly operations. This transit service, esteemed as one of the best in the nation, principally serves the transportation needs of economically-challenged individuals within the Portland metropolitan region. Economists estimate that the 25,000-31,000 jobs made possible by the interchange improvement will translate into an estimated $145M in additional payroll taxes to fund expanded public transit operations over the next 20 years. 4. Sustainability Improved Energy Efficiency: Clean, renewable energy will supply the required 60 Kilowatt hours per month for the interchange. The SIM Project will place $580,000 of locally manufactured solar panels near the interchange to power traffic and street lights. The project may be incorporated into the Oregon Solar Highway initiative, which places solar arrays on state right of way land.

19 http://www.hillsboro2020.org/FileLib/H2020ActionPlan2010_Web.pdf 20 http://www.oregon.gov/ODOT/HWY/REGION1/US26_brookwoodpkwy/

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Smart Growth: The interchange improvements will dramatically improve future traffic operations, lower fuel consumption, reduce travel delays, and minimize carbon dioxide (CO2) and other greenhouse gas (GHG) emissions. In addition, interchange construction will need to occur as part of a strategic expansion of Hillsboro‟s Urban Growth Boundary, or area within which urbanization can occur. By confining development to these areas, planners protect valuable farm and forest land. For these and other efforts, the city has received significant recognition for its sustainability and livability practices. In 2010, Hillsboro ranked second in the Environmental Protection Agency‟s Green Power Communities Challenge program.

Lowering Green House Gas Emissions Transportation accounts for 38% of Oregon‟s CO2 emissions, with vehicle CO2 emissions predicted to increase 33% by 2025 due to increased driving and congestion. Modeling of 2035 forecast year conditions for the SIM Project indicates: The Build Scenario would reduce travel delays by about 2,000 vehicle hours per average weekday, or 5.66M vehicle hours of delay over the 20-year analysis period (2015-2035). Reducing stops and improving travel speeds will reduce fuel consumption. Preliminary assessment of No-Build vs. Build environmental impact indicates a 20-year reduction of nearly 16,400 metric tons of CO2, and major reductions in criteria pollutants. Hillsboro also estimates the SIM Project will yield a 1.96M gallon reduction in local fuel consumption over the 20-year period.21 The Build Scenario for the Region‟s Financially Constrained project list, including this project, has been analyzed for air quality conformity and has met federal requirements. Oregon Metro, the regional planning organization, estimated future carbon monoxide, precursors of smog (volatile organic compounds and nitrogen oxides), and CO2 emissions from cars and trucks operating in the greater Portland air shed to the year 2035 using EMME/2 modeling software and Mobile 6.2, the latest model approved by the U.S. Environmental Protection Agency (EPA). The emissions analysis demonstrated that the region will continue to meet state and federal air quality requirements if the projects and programs assumed in their current project list are implemented. Supporting Green Manufacturing: A unique sustainability benefit that would result from Project SIM is fostering the expansion of Hillsboro‟s renewable energy manufacturing cluster. SolarWorld, which manufactures solar panels in the Silicon Forest, currently produces 350 MW of solar modules annually. Every 3 minutes, SolarWorld produces enough equipment to power a single-family home. Solar cell technologies are closely related to silica-based technologies used in microchip manufacturing: both require similar personnel, workforce training, technologies, tools, industrial processes, gases, electrical demand, and large quantities of high quality water. The microchip industry developed in the area by Intel and others – and fostered through infrastructure development by the City of Hillsboro – has put these foundational elements in place. SolarWorld‟s expansion in the Silicon Forest has attracted other businesses to the cluster, including fuel cell manufacturer ClearEdge Power and Ulbrich, a metals industry manufacturer with solar panel applications. Additional clean-tech manufacturing will reduce the future carbon footprint of our nation through production of renewable energy.

21 See “Emissions Model” on project website.

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Apart from these benefits, the Project will not have a significant impact on the environment because it builds on an already established footprint avoiding encroachment into wetlands, floodways and historical resource areas. Additional stormwater quality and quantity impacts associated with added impervious surface areas are programmed for mitigation adjacent to the project site. Future improvements relating to the culvert and bridge crossings of Waible Creek tributaries as well as development and implementation of a regional storm water master plan will be elements of the Phase II Figure 12: AM Interchange Queue: Year 2035 improvements. Therefore, no AM simulation is a model of existing conditions plus ~25,000- additional impact is expected 31,000 new employees utilizing the intersection. Queue spillback is expected to regularly reach the freeway mainline by 2035. from the SIM Project, and the project is on track to receive a NEPA Categorical Exclusion by February of 2013. (See Figure 7: NEPA and Permit Timeline). 5. Safety Looming Safety Issues: Safety for the traveling public is the primary focus of transportation investments by the State of Oregon and the City of Hillsboro. The city extended the off-ramp in conjunction with Intel‟s expansion 10+ years ago, but that ramp now operates at 98% of its capacity. Continued growth of industrial employment surrounding this critical interchange will increase off- ramp demand to 150% of current levels by 2035. 22 Average Daily Traffic (ADT) modeling estimates that westbound ramp traffic will increase from 9.500 vehicles daily in 2011 to 14,700 in 2035. Accidents are also expected to increase by 30+% during this time. Of primary concern is the westbound off-ramp traffic in the morning and the corresponding eastbound onramp in the evening. Interchange congestion spills over onto the highway as well as onto surface arterial roadways. The eastbound ramp meter regularly queues traffic back for over one-half mile. These queues block access for vehicles seeking to cross over U.S. 26 both to commute home to large residential areas located northeast of the interchange, and for trucks seeking to access the Portland port district over Cornelius Pass Road. Currently, fire engines experience delays while attempting to maneuver through congestion in the area. Hazardous materials also travel this increasingly dangerous road over U.S. 26 to Cornelius Pass Road to access the Port of Portland, including shipments of industrial gases for the fabrication processes for the high-tech industries. The Safety Solution- Better Design: The SIM Project will address these needs by building: Westbound U.S. 26-to-southbound loop off-ramp; Two northbound through lanes; Third southbound receiving lane requiring structure widening; and Additional northbound-to-eastbound turning movement capacity and ramp meter storage. The Meek Road/Brookwood Parkway and Jacobson Road/Groveland Road/Helvetia Road unsignalized intersections do not meet access spacing standards and are located within a few

22 See “Safety Analysis” on project website.

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hundred feet of the existing interchange ramp signals. To both accommodate the new loop off ramp configuration and address existing safety and capacity deficiencies, Phase I of this Project will realign Jacobson Road so that it and Helvetia Road will intersect a safe distance from the interchange. The City plans to construct 253rd Avenue west of Brookwood Parkway in Phase II of the SIM Project to allow Meek Road to be closed at the Brookwood Parkway approach, solving an existing community safety concern. This yields a much safer operation and provides a safe, efficient route to open up the new Meek Road Industrial area for development. Construction of the Huffman Road extension will relieve congestion at Evergreen Parkway and Brookwood Parkway, yet provide optimum separation from the interchange project to protect future interchange and freeway operations (see Figure 4: SIM Project Road Improvements). Phase I of the SIM Project includes structure widening to support three southbound lanes on Brookwood Parkway, but does not include construction of a third receiving lane south of the interchange. As such, Phase I is estimated to add interchange capacity for any estimated 5,000- 7,000 new jobs south of the interchange before constrained capacity at the eastbound interchange signal will queue traffic back onto the new loop off ramp and onto the US 26 mainline. With the requested TIGER funding for Phase I, Phase II will complete the Phase I capacity investment by including a southbound lane extension, boosting interchange capacity to an estimated 12,000 to 14,000 new jobs south of the interchange. B. Job Creation & Near-Term Economic Activity Figure 13: Federally-Designated Economically Distressed Areas Served by SIM Project Nearly 7,000 workers from Federally-designated EDA’s work in Hillsboro

Job Creation: The SIM Project will quickly expand business opportunities during construction for rapid economic impact, immediately creating jobs in engineering, materials supply, and

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construction. Economists estimate that the $65.65M project will generate approximately 329 jobs during the course of the three-year project, according to the breakdown below, and resulting in 570 job years of job stimulus just for construction work (See also Table 4).  22 jobs in the engineering, financial, and professional services sectors  287 construction jobs over the course of the Project  20 jobs associated with materials supply and delivery

The benefits of economic development will be shared in areas hard hit by the economic downturn. Seven counties surrounding Hillsboro qualify as federally Economically Distressed Areas (see Figure 13). Together, residents of Columbia, Marion, Yamhill, Lane, Polk, and Deschutes counties have 6,894 jobs in Hillsboro according to the most recent economic data available.23 As of January 2012, Columbia County had an unemployment rate of 9.7%; Clackamas 8.1%; Clark 11.4%; Yamhill 8.9%; and Marion 9.5%. In addition, Washington County, where Hillsboro is located, is considered distressed under Oregon law, although not under federal law. These areas will benefit both from near-term construction and long term job creation via Silicon Forest employers. See Table 3 (SIM Project Schedule) below for projected employment by quarter. Figure 14: Industry Share of Total The Great Recession was deeper in Greater Portland than U.S. Exports24 (2010) in the U.S. as a whole.25 Average home prices fell by nearly one-third The region shed 80,000 jobs (7.4% of total employment) between March 2008 when the local recession began and December 2009 when it ended. Unemployment peaked in June of 2009 at 11.2% and remained above 10% until February 2011. Exports are at the core of Greater Portland‟s economic resilience and potential. Between 2003 and 2010, Portland increased its export volume by over 109%, creating 45,863 new jobs. The key drivers of that growth are a handful of companies and clusters that drive much of Greater Portland‟s export strength, many serviced by the SIM project.26

Job Promotion for Low Income Workers: The SIM Project will provide broad employment opportunities via ODOT‟s innovative Workforce Development Program. 27 The program is designed to expand employment diversity, increase apprenticeship participation and training resources, and opportunities for highway construction jobs throughout the state. ODOT and its partners identify and screen a pool of applicants that contractors can access for apprentice-

23 See “Distressed Areas Workforce” spreadsheet on project website. 24 “Greater Portland Export Plan- Metro Export Initiative.” From the Brookings-Rockefeller Project on State and Metropolitan Innovation. 25 Id. at p.5. 26 Id. at p. 6. 27 http://www.oregon.gov/ODOT/CS/CIVILRIGHTS/wdp.shtml

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ship and occupational training opportunities. Regional Workforce Alliances identify suitable women, minority and low-income candidates from community based organizations and WorkSource Oregon‟s iMatchSkills system. After several skill assessments, candidates are placed on various tracks, hinging their job-readiness aptitude. In addition, the SIM Project will also participate in ODOT‟s On-the-Job Training (OJT) program,28 which trains and augments the skills of minorities and women in highway construction trades, assists contractors in Equal Employment Opportunity obligations, and leads workers into possible apprenticeships and careers in highway construction. OJT offers trainees instruction in cement masonry, carpentry, utilities, iron-working and construction management and administration. Thus, hiring for the project focuses on finding, training and employing a diverse, skilled workforce. Opportunities for Small Businesses & Disadvantaged Business Enterprises: The Project will establish fixed race-conscious and race-neutral goals in contracting after federal funding is approved. The state is allowed to use hard goals for Disadvantaged Business Enterprises based on a 2011 ODOT study, 29 which sought to determine whether disparities had occurred in awarding subcontracts on ODOT projects. The study found that while progress had been made on inclusive hiring practices, ODOT underutilized African American-owned and Asian-owned firms. Thus, courts permitted the state to set race and gender conscious goals on selected projects that receive federal funds, including the SIM Project. Community Organizations for Disadvantaged Workers: The Project will utilize community organizations to connect disadvantaged workers with economic opportunities, including: Worksystems, Inc.: Local nonprofit that provides workforce development services, leveraging relationships with regional government, business, labor, and educational institutions. WorkSource Oregon: Network of public and private partners who work together to provide workforce development systems, ensure businesses have a ready supply of trained workers, and assist Oregon‟s unemployed and underemployed find appropriate employment opportunities. Centro Cultural: Provides technical training specifically geared toward Latinos. Portland Community College (PCC): PCC‟s Hillsboro campus has programs specifically geared toward construction training. PCC‟s Building Construction Technology program offers curriculum in construction skills, construction management, and design/build remodeling. The program enjoys a strong relationship with local contractors and national associations. New Area Construction Jobs after SIM: In addition to direct jobs, construction workers, engineers, and materials suppliers will also benefit from the opportunity to work on behalf of companies developing new industrial facilities on the 1,180 acres “unlocked” by the interchange. Commencement of the SIM Project will signal to area businesses that the Silicon Forest has the requisite infrastructure capacity for siting new operations. Currently, technology companies partner with community groups and local universities for workforce training and development in Hillsboro and surrounding communities. A primary focus is on connecting disadvantaged workers with economic opportunities in the high tech and clean tech industries. Examples include: Worksystems, Inc.: Launched an energy efficiency partnership in the software industry to prioritize training to reduce the industry‟s carbon footprint. Worksystems has also established a Clean Technology Skill Panel to guide regional investments of $200,000 in workforce training and development. State Energy Sector Partnership (SESP): offers support for students struggling financially to achieve their educational goals and pursue careers in renewable energy and clean-tech.

28 http://www.oregon.gov/ODOT/CS/CIVILRIGHTS/ojt_program.shtml 29 http://www.oregon.gov/ODOT/CS/CIVILRIGHTS/sbe/dbe/dbe_program.shtml#Study

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Portland Community College (PCC): PCC offers degrees in Electronic Engineering Technology and Renewable Energy Systems. Graduates of these programs are qualified to work as technicians in several renewable energy and other high technology fields. Sound Labor Practices in Compliance with Federal Law: SIM Project work will comply with all state and Federal labor practices. The City of Hillsboro, in conjunction with ODOT, requires employers to adhere to all requirements for worker safety, worker‟s compensation, prevailing wage rates, and benefits packages. To ensure compliance, ODOT maintains a rigid labor compliance program30 as an element of their project management approach. Civil Rights & Equal Opportunity Laws: ODOT is committed to equal employment opportunity in its workforce and for workers employed by companies under contract with ODOT. ODOT has received a waiver from U.S. DOT to establish hard goals for specific underutilized minority groups. This approach has been utilized successfully on the recent ODOT contract to improve Highway 217 in Washington County, and may be utilized on SIM Project contracts.

30 “ODOT Labor Compliance Program.” Available: http://www.oregon.gov/ODOT/CS/CIVILRIGHTS/labor/labor.shtml

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1. Project Schedule The Project Schedule (Table 3) reflects the two-phase approach for the overall SIM Project, which includes: Phase I: Phase I will modify the interchange. Preliminary planning, design, permitting, and environmental preparations are already underway and expected to be completed by the start of Q2, 2013. Subsequently, construction will commence and is expected to be completed in Q3, 2015. Note that TIGER funding will be used exclusively for Phase I construction work. Funding from ODOT and the City of Hillsboro will supplement this Federal support and cover the balance of Phase I activities. Phase II: Between 2013 and 2015, ODOT and City of Hillsboro funds will be used to complete critical capacity improvements on Brookwood Pkwy. and Helvetia Road, and to develop and improve industrial area access roads served by the interchange. The Phase II schedule includes planning, design, permitting, and environmental preparations through Q2, 2014, followed by construction, which will be completed by the start of 2016. Note that no TIGER funding will be used for Phase II. The SIM Project is well-planned, with a detailed schedule that is feasible and demonstrates a clear, reasonable timeline for securing all necessary permits and environmental approvals such that construction can commence quickly upon receipt of a TIGER grant. Grant funds will be spent steadily and expeditiously throughout the 2+ year construction cycle. Table 3: SIM Project Schedule Year: 2012 2013 2014 2015 Quarter: Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Interchange Area Mgmt Plan P NEPA H Prelim Design A Permits S Right-of-Way E Plans, Specs & Estimates Construction I Jobs Estimate 3.1 3.1 3.1 3.1 14.4 29.4 29.4 29.4 51.2 51.2 51.1 51.1 - - - - Funding Source* S S S SC SC TSC TSC TSC TSC TSC TSC TSC TSC TSC TSC - P Interchange Area Mgt. Plan* H Prelim Design** A Permits** S Right-of-Way** E Plans, Specs & Estimates** Construction** II Funding Source* - - - - SC SC SC SC SC SC SC SC SC SC SC SC * T=TIGER (U.S. Department of Transportation) C=City of Hillsboro S=State (Oregon Department of Transportation) ** Multiple construction contracts will be issued for individual projects; expedites schedule for projects requiring little/no environmental permitting.

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Phase I Economic Benefit: Table 4 Table 4: Economic Benefit from Phase I Development outlines anticipated real, constant Quarterly Quarterly Quarterly dollar benefits from direct development Quarter Spending Job Creation Payroll and construction activity for Phase I of 3Q11 $522,200 5.0 $226,000 the SIM project. In real terms, the 4Q11 $522,200 5.0 $226,000 $38.9M development project, less 1Q12 $326,400 3.1 $141,000 right-of-way expense, is expected to 2Q12 $326,400 3.1 $141,000 yield well over $34M in immediate, 3Q12 $326,400 3.1 $141,000 direct business revenue during the 3.5- 4Q12 $326,400 3.1 $141,000 year development period. It is expected 1Q13 $1,500,300 14.4 $650,000 to create nearly 330 quarterly direct jobs and nearly $15M in quarterly 2Q13 $3,068,600 29.4 $1,330,000 payroll wages.31 3Q13 $3,070,600 29.4 $1,331,000 4Q13 $3,070,600 29.4 $1,331,000 These figures do not include funds 1Q14 $5,345,000 51.2 $2,317,000 used on right of way acquisition since 2Q14 $5,345,000 51.2 $2,317,000 these are a transaction and not a 3Q14 $5,340,100 51.1 $2,315,000 broader benefit. All numbers are in 4Q14 $5,340,100 51.1 $2,315,000 2011 dollars. Totals: $34,430,300 329.5 $14,922,000 2. Environmental Approvals Source: City of Hillsboro, IMPLAN, and Johnson Reid, LLC NEPA is currently underway and expected to be completed by December 2012. ODOT builds in a two month window to account for unforeseen delays to estimate a February 2013 completion date for NEPA. See Section V below for estimated intermediate deadlines in NEPA process. The project was designed and scoped to ensure Phase I elements avoid significant impact to floodways, wetlands, streams, and historical resources, specifically limiting work elements to ensure a Categorical Exclusion. 3. Legislative Approvals The 2009 Oregon Jobs & Transportation Act (OJTA) provides $45M in funds for this Project and received all necessary legislative approvals. The project has received support from city, state and national elected officials. (See section IV.B.2- Partnership). The Oregon Legislature also recently approved, and Governor John Kitzhaber signed into law on March 19, 2012, legislation that includes $3M to $4M in additional funds for the SIM Project (Senate Bill 1543).32 4. State and Local Planning The project is consistent with the region‟s adopted Regional Transportation Plan (Project #3149) and with both the City of Hillsboro and Washington County Transportation System Plans.33 5. Technical & Financial Feasibility The project is technically feasible. The engineering and design activities for the SIM project have been reviewed by ODOT and the City of Hillsboro, which each have extensive experience in managing transportation projects. The cost estimate provided for the project Phase I is based on ODOT modeling, with Phase II estimated by the City. State and city funds for the SIM project have already been allocated. In the event of cost overruns in Phase I of the interchange

31 “Short Term Benefit Table” on project website. 32 Oregon SB 1543: http://www.leg.state.or.us/12reg/measpdf/sb1500.dir/sb1543.en.pdf. 33 See project website for link to these plans.

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construction, the phase scheduled to use TIGER funds, money slated for arterial roads will be reprogrammed to ensure that the interchange itself is completed. In the event that a contractor is unable to perform, alternate appropriate contractors will be utilized. For other unforeseen difficulties, ODOT and City of Hillsboro project teams will address any problems as they arise. C. Innovation A Clean Energy Model: The SIM Project will include solar panels to power the interchange signals and street lights as discussed above. TIGER funds will be used for the purchase and installation of solar panels, supporting computer software and electrical design. This innovative strategy will save energy and serve as a model to other communities. Innovative Planning: Hillsboro has completed innovative planning for this industrial area to promote sustainable, green jobs through a restrictive, comprehensive plan. By limiting land-use types, the City aims to continue growth of manufacturing clusters, including high-tech, bio-tech, and sustainable industries. A city-managed Special Industrial District has been created in the Evergreen Industrial Site to assure the provision of at least one 100-acre development site, or three 50-acre development sites within the District, on which development shall be limited to high tech product manufacturing. Similar requirements will be implemented in the recently approved Meek Road Industrial Site to protect land for large lot industrial campus use.

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D. Partnerships Jurisdictional & Stakeholder Collaboration: The proposed $15M in TIGER grant funds would complement State and local funding to complete the funding package necessary to execute the SIM Project. Local utilities have already done their part to prepare the land surrounding the capacity-constrained interchange for development, including the following non-Federal investments to support industrial jobs growth: 66-in. diameter water supply north Sanitary sewer pump station/force main ($19M) transmission pipeline ($52M) Sanitary sewer treatment capacity ($4M) 10M gallon (MG) local reservoir ($17M) Electrical substation/power supply infrastructure 15MG local reservoir ($20M over next 2 yrs) (~$44M, phased over next 10 years) In addition, the following entities have written letters of support for the SIM Project.

Silicon Forest Interchange Modernization TIGER Project Supporters Suzanne Bonamici, Jeffrey Merkley, Senator, Ron Wyden, Senator, Representative, U.S. House United States Senate United States Senate of Representatives Morgan Anderson, Shawn Lindsay, Representative, Bruce Starr, State Senator, Government Affairs, Intel Oregon State House Oregon Senate Gordon Brinser, President, Doug Johnson, Chair, Shinichiro Higuchi, President, SolarWorld Industries Hillsboro 2020 Vision AGC Electronics America America Implementation Committee Tom Hughes, President, Mike Scott, Superintendent, Max Lyons, President, Oregon Metro Council Hillsboro School District Hillsboro Aviation Carlotta Collette, Chair, Michael Lindsay, Senior VP, Howard Larson, Broker, Metro Joint Policy Advisory TOK America Colliers International Committee on Transportation Andy Duyck, Chairman, Tim McCabe, Director, Hillsboro Chamber of Washington County Board of Business Oregon Commerce County Commissioners John Mohlis, Exec. Secretary, Jonathan Schleuter, Executive Jeng Lue, Director, Oregon State Building and Director, Westside Economic Oregon Plant, Jireh Construction Trades Council Alliance Pat Egan, Chair, Randall Reed, Controller, Ralph Quinsey, CEO, OR Transportation Commission ACUMED TriQuint SemiConductor Steve Greenwood, Governor John Kitzhaber’s Regional Solutions Coordinator Letters and full list of supporters is available on the project website. The city often partners with other local businesses and community organizations, and can provide more letters upon request. Disciplinary Integration: This Project is a result of partnership between ODOT, the City of Hillsboro, and Washington County. Jointly all agencies have made this interchange a priority in order to make necessary capacity improvements before they become impediments to critical industrial expansion in the area. Community partners see this project as critical to making Hillsboro a more livable community.

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E. Results of Benefit-Cost Analysis Executive Summary for Benefit Cost Analysis US 26/Helvetia-Brookwood interchange was constructed to rural standards and currently operates near capacity. The Meek Road/Brookwood Parkway and Jacobson Road/Groveland Road/Helvetia Road unsignalized inter- Current sections do not meet access spacing standards and are located within a few Status/Baseline hundred feet of existing interchange ramp signals. Traffic backs up onto the & Problem to highway and surrounding arterial roads creating headaches for workers in be Addressed this key high tech hub, constraining future economic development and job growth. Pedestrians and cyclists are deterred from accessing employers and the Helvetia recreation area near the interchange because of a lack of sidewalks and bike lanes, particularly during weekdays due to heavy traffic. Phase I of SIM Project addresses these needs by constructing new off and on ramps to handle traffic and prevent spill back onto the highway and surrounding road, expanding the industrial capacity to accommodate future expansion. Arterial and collector roads serving the interchange will be expanded and rerouted for improved safety and traffic flow. Jacobson Road Changes to and Groveland Road (Phase II) will be reconstructed to intersect a safe Baseline/ distance from the interchange. Bike lanes and sidewalks will be added to the Alternatives interchange and solar Panels will be added to power the interchange. (See Figure 4: SIM Project Road Improvements). Phase II of the Project addresses development of a safe, efficient and marketable access road system to open up the surrounding 1,180 acres of “shovel ready” land. The network of connector roads will be built with a minimum of two lanes and bike lanes, leaving remaining roadway completion to be delivered by the private sector. 329 direct jobs and 570 job years created by SIM* Enable up to 31,000 higher quality potential new jobs Types of Area high tech businesses will have improved access to airport and rail. Impacts 1.96M gallons of fuel will be saved 5.66M vehicle hours worth of time saved 16,400 tons of CO2 not emitted. Population 14,700 daily drivers with reduced wait time Affected by 30% accident rate increase and increased fatalities from no-build avoided Impacts Some communities benefitting are in Economically Distressed Areas $14.9M in payroll generated directly by the Project. $4.9B in new expanded payroll unlocked compared to without SIM Economic $1.7B in additional business investment vs. “no build”, or $2.3B total Benefits Over $42M of travel time savings gained as a result of the SIM project. Nearly $500,000 saved in reduced accidents and improved operating costs. Nearly $200,000 saved from vehicle emissions reductions. SIM project will enable creation of $4.9B in net benefits. The project will Summary of immediately create 329 direct jobs (or 570 job years) and up to 31,000 higher Results quality jobs will be enabled on land unlocked by development. See Table 6 on page 29 for full BCA analysis. Table 5 on page 28 also Page Ref. in BCA provides a breakdown of job creation data. *All values given indicate projects over 20 year period. No Build scenario assumes less development based on diminished attractiveness to business

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Table 5 below reflects the net economic benefit of development of the SIM project. Table 6 is the Benefit Cost Analysis (BCA), including demonstrable benefits to Livability, Safety, Sustainability, and Economic Competitiveness.34 The following assumptions apply: Estimates in both tables reflect true benefit methodology as recommended by the U.S. DOT for BCA. Economic estimates reflect the gain in economic value expected from SIM Project development and successful continuation of high-tech R&D and manufacturing growth in the Silicon Forest, less economic development anticipated to still occur without the Project. The No Build scenario reflects significantly reduced high-tech growth and development n the Silicon Forest, but instead a higher concentration of general manufacturing and other industrial uses reflective of more local and regional economic value rather than national value. Based on these assumptions, the BCA results in the following overall conclusions: Although economic development is anticipated under both the Build and No Build Scenarios, analysis finds that the Build Scenario indicates immediate interchange improvements and the assurances for existing and potential high-technology firms creates significantly greater payroll and physical business investment over the study period. Discounted to 2011 dollars, the Build Scenario has a present value benefit of $4.9 billion in employment payroll that otherwise would not be created. Likewise, the Build Scenario creates, in discounted dollars, a net benefit of $1.7 billion in industry physical (property) development value than would otherwise occur with significantly lower high-technology cluster industry growth over the study period. Silicon Forest high-technology firms spend significantly in replacement and upgrades of high-value capital equipment as consumer electronic technology research, development, and deployment rapidly changes. Guarantee of continued, long-term expansion capacity for technology-intensive industries in the Silicon Forest results in a discounted, present benefit of over $9.7 billion in employment payroll and over $2.3 billion in local business capital investment for expansion and technological replacement and upgrades. Without SIM project construction, it is anticipated that economic development continues within the Silicon Forest, but at lower employment densities and a far greater percentage of general industrial users serving the local, regional economy rather than technology-intensive firms with international presence. Accordingly, the estimated present value of likely economic development without the SIM project is estimated at $4.78 billion in employment payroll and over $623 million in local business capital investment for expansion and equipment replacement and upgrades.

34 See project website for a more detailed explanation of the methodology used to calculate the BCA.

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Table 5: Net Economic Benefits of SIM Project Construction High Value Economic Development Less No Build Lower Value Economic Development

JOBS BENEFITS COSTS DISCOUNTED NET MONETARY BENEFITS Annual Annual New Discounted Discounted Direct, Net Economic Benefits from Discounted On-Going Net Economic Benefits Temporary Permanent Discount Project SIM Construction From SIM Development Year Jobs Jobs Factor Costs Payroll Business Revenues Payroll Business Investment 2011 10.0 - 1.0000 $ 1,044,000 $ 452,000 $ 1,044,000 $ - $ - 2012 12.5 - 0.9346 $ 5,426,000 $ 527,000 $ 1,220,000 $ - $ - 2013 102.5 - 0.8734 $ 9,355,000 $ 4,055,000 $ 9,355,000 $ - $ - 2014 204.5 - 0.8163 $ 17,444,000 $ 7,562,000 $ 17,444,000 $ - $ - 2015 4.3 1,127 0.7629 $ 343,000 $ 149,000 $ 343,000 $ 29,455,000 $ 106,491,000 2016 13.2 1,175 0.7130 $ 4,195,000 $ 428,000 $ 987,000 $ 57,513,000 $ 103,742,000 2017 43.1 1,225 0.6663 $ 3,003,000 $ 1,302,000 $ 3,003,000 $ 84,235,000 $ 101,065,000 2018 0.0 1,277 0.6227 $ - $ - $ - $ 109,680,000 $ 98,456,000 2019 0.0 1,331 0.5820 $ - $ - $ - $ 133,904,000 $ 95,914,000 2020 4.3 1,387 0.5439 $ 245,000 $ 106,000 $ 245,000 $ 156,963,000 $ 93,439,000 2021 13.2 1,446 0.5083 $ 2,991,000 $ 305,000 $ 704,000 $ 178,907,000 $ 91,027,000 2022 43.1 1,507 0.4751 $ 2,141,000 $ 928,000 $ 2,141,000 $ 199,785,000 $ 88,677,000 2023 0.0 1,571 0.4440 $ - $ - $ - $ 219,646,000 $ 86,388,000 2024 0.0 1,638 0.4150 $ - $ - $ - $ 238,533,000 $ 84,158,000 2025 4.3 1,707 0.3878 $ 175,000 $ 76,000 $ 175,000 $ 256,491,000 $ 81,986,000 2026 13.2 1,780 0.3624 $ 2,133,000 $ 217,000 $ 502,000 $ 273,561,000 $ 79,870,000 2027 43.1 1,855 0.3387 $ 1,527,000 $ 662,000 $ 1,527,000 $ 289,781,000 $ 77,808,000 2028 0.0 1,934 0.3166 $ - $ - $ - $ 305,190,000 $ 75,800,000 2029 0.0 2,016 0.2959 $ - $ - $ - $ 319,824,000 $ 73,843,000 2030 0.0 2,101 0.2765 $ - $ - $ - $ 333,716,000 $ 71,937,000 2031 0.0 2,190 0.2584 $ - $ - $ - $ 346,901,000 $ 70,080,000 2032 0.0 2,283 0.2415 $ - $ - $ - $ 359,409,000 $ 68,271,000 2033 0.0 1,837 0.2257 $ - $ - $ - $ 364,960,000 $ 51,341,000 2034 0.0 - 0.2109 $ - $ - $ - $ 348,907,000 $ 53,296,000 2035 0.0 - 0.1971 $ - $ - $ - $ 333,561,000 $ 49,809,000 TOTALS 502 31,388 $ 48,977,000 $ 16,317,000 $ 37,645,000 $ 4,940,920,000 $ 1,703,400,000 1/ Rounded to the Nearest Thousand

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Table 6: SIM Project Phase I Benefit-Cost Analysis

PRESENT VALUE OF USER BENEFITS USER BENEFITS IN CONSTANT DOLLARS Economic 2011 Present 2011 Present Liveability Safety Sustainability Competitiveness Value Value 2011 Travel Vehicle Vehicle Productivity of Total of Total NET Year Time Op. Cost Accident Emission Payroll Project Project PRESENT Savings Savings Reductions Reductions Benefits Benefits Costs VALUE Construction Period 2011 $0 $1,044,000 ($1,044,000) 2012 $0 $5,426,000 ($5,426,000) 2013 $0 $9,355,000 ($9,355,000) 2014 $0 $17,444,000 ($17,444,000) Project Open 2015 $2,793,913 ($44,286) $36,649 $11,636 $29,455,000 $32,252,912 $343,000 $31,909,912 2016 $2,611,134 ($41,389) $34,252 $11,408 $57,513,000 $60,128,404 $4,195,000 $55,933,404 2017 $2,568,749 ($40,717) $32,011 $11,223 $84,235,000 $86,806,266 $3,003,000 $83,803,266 2018 $2,520,735 ($39,956) $29,917 $11,013 $109,680,000 $112,201,709 $0 $112,201,709 2019 $2,468,009 ($39,120) $27,959 $10,783 $133,904,000 $136,371,631 $0 $136,371,631 2020 $2,411,394 ($38,223) $26,865 $10,535 $156,963,000 $159,373,571 $245,000 $159,128,571 2021 $2,351,624 ($37,275) $25,107 $10,274 $178,907,000 $181,256,730 $2,991,000 $178,265,730 2022 $2,289,353 ($36,288) $23,465 $10,002 $199,785,000 $202,071,532 $2,141,000 $199,930,532 2023 $2,225,166 ($35,271) $21,929 $9,722 $219,646,000 $221,867,546 $0 $221,867,546 2024 $2,159,578 ($34,231) $20,495 $9,435 $238,533,000 $240,688,277 $0 $240,688,277 2025 $2,093,049 ($33,177) $19,154 $9,144 $256,491,000 $258,579,171 $175,000 $258,404,171 2026 $2,025,982 ($32,114) $17,901 $8,851 $273,561,000 $275,581,621 $2,133,000 $273,448,621 2027 $1,958,733 ($31,048) $16,730 $8,558 $289,781,000 $291,733,972 $1,527,000 $290,206,972 2028 $1,891,611 ($29,984) $20,122 $8,264 $305,190,000 $307,080,014 $0 $307,080,014 2029 $1,824,888 ($28,926) $18,806 $7,973 $319,824,000 $321,646,741 $0 $321,646,741 2030 $1,758,800 ($27,878) $17,576 $7,684 $333,716,000 $335,472,181 $0 $335,472,181 2031 $1,693,549 ($26,844) $16,426 $7,399 $346,901,000 $348,591,529 $0 $348,591,529 2032 $1,629,307 ($25,826) $15,351 $7,118 $359,409,000 $361,034,951 $0 $361,034,951 2033 $1,566,223 ($24,826) $14,347 $6,843 $364,960,000 $366,522,587 $0 $366,522,587 2034 $1,504,420 ($23,846) $13,408 $6,573 $348,907,000 $350,407,555 $0 $350,407,555

Total $42,346,218 ($671,224) $448,470 $184,438 $4,607,361,000 $4,649,668,902 $50,022,000 $4,599,646,902

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

V. Project Readiness & NEPA The SIM project is ready to move forward quickly. Below is a list of required permits for Phase I of the SIM Project, the portion using federal TIGER money. The table includes the local, state, and federal agencies with jurisdiction, and the anticipated completion dates for each approval. Phase I of the project includes $15M in TIGER funds for improvements to the interchange itself. NEPA approvals for this Phase will be completed by February of 2013 ensuring TIGER funds can be obligated within the statutory deadline. Phase II of the SIM project includes upgrades to arterial and collector roads serving the interchange. Construction on these roads will not require NEPA approval due to use of only local and state funding. Other necessary permits for Phase II of the SIM project may be obtained after TIGER funds obligation deadline. Legislative approvals, financial and technical feasibility are described above in Table 3: SIM Project Schedule. Table 7: NEPA and Permit Timeline Estimated Permit Required Agency Scope and Status Completion Date Project included in Portland FHWA; Metro adopted Regional Oregon Dept. of Air Quality Transportation Plan which Completed Environmental documented air quality Quality (ODEQ) conformity Oregon State Field work completed, National Historic Historical nothing found, and report in Preservation Act (NHPA) Preservation Office process due 4/27/12. PA 6/15/2012 Section 106 (Oregon SHPO) Memo anticipated. Route to (Cultural Resources) tribes. Type I, Studies to commence FHWA following IAMP traffic Noise 8/15/2012 forecast study completion 6/12 Federal (US Army Met onsite with regulatory Clean Water Act (CWA) Corps of Engineers); agencies, no concerns 7/15/2012 §404 Permit. Oregon Division of identified. Joint permit State Lands (DSL) submittal 4/27/12. Federal: Delegated Design Acceptance Package to Oregon DEQ for (DAP) by end of May; water Clean Water Act (CWA) rural; Clean Water quality mitigation design to 11/15/2012 §401 Permit. Services for Urban follow, then permit submittals to ODEQ and CWS Federal (US Army Wetland delineation done. Corps of Engineers): Preliminary determination CWA Executive Order Oregon Division of only 0.14 Ac wetland impact. 7/15/2012 #11990 Wetlands State Lands Report due end March 2012. Joint permit submittal 4/27/12 Federal (US Army CWA Executive Order No floodplain encroachment. Corps of Engineers): 7/15/2012 #11988 Floodplain Joint permit submittal 4/27/12 Oregon DSL §7 Endangered Species NOAA (National Field work done. No Effect 9/15/2012

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

Act, Essential Fish Marine Fisheries memo for Terrestial Species, Habitat Service) SLOPES IV work is started to address Aquatic Species. §4(f) Department of FHWA No Section 4(f) property Transportation Act involved; Section 6(f) does July 2012 (23 CFR 774) not apply Coastal Zone Not in Coastal Zone July 2012 FHWA/Oregon Project involves 4 relocations Dept. of Relocations and will follow provisions of 11/15/12 Transportation the Uniform Relocation Act. (ODOT) FHWA/ODOT A level I HMA will be ODEQ completed as part of project Hazardous Waste and development. A Level II may 11/15/12 Materials be done depending on what is found. All NEPA paperwork expected to be submitted together in December 2012. NEPA Categorical Exclusion Expected February 2013 Non-NEPA Permits (below) 1)ODEQ (disturb 1 1) ODOT self-certified for Rural Area Permits: acre or more) 1200-CA permit, coord. with 1) 1200-C 2)Washington Co. CWS; 2) Erosion Control 3)Washington Co. 2)Permit process after PS&E March 2013 3) Land Use Approval 4)Washington Co. 3)Article 7 Hearing for rural 4) Facilities Permit roads and grading permit 4)Plans approval, bonding Urban Area Permits: 1) Clean Water 1) Erosion Control Services (CWS) 2) Natural Resource 2)City of Hillsboro Standard permits to be Assessment/ Veg. 3)CWS processed following March 2013 Corridor 4)City of Hillsboro completion of PS&E 3) Storm Water Permit 4) Right of Way Permit Updates and supporting documentation on the projects NEPA status can be found at the SIM project‟s ODOT website.35

35 US 26 Brookwood/Helvetia Interchange: http://www.oregon.gov/ODOT/HWY/REGION1/US26_brookwoodpkwy/

Application to the U.S. Department of Transportation Fiscal Year 2012 TIGER Grant Program Solicitation # DTOS59-12-RA-TIGER4

VI. Federal Wage Rate Certification The SIM Project will comply with all federal wage requirements contained in subchapter IV of chapter 31 of title 40, United States Code. The Project website contains a copy of the signed certification. VII. Changes to Pre-application Form The following information is different from material supplied on the pre-application: The total project budget is $65.66M, not $62.66M. This reflects the recent passage of SB 1543, approved unanimously in the Oregon House and Senate and into law by Governor John Kitzhaber, directing an additional $3M to $4M of state funds toward the SIM project. Oregon Department of Transportation is now a co-applicant on the project. Washington County is not a co-applicant on this project.