Oregon is changing a half-century-old land-use law to make room for semiconductor development and gain an edge in attracting the multibillion-dollar industry, upsetting farmers who see their livelihoods at risk.
Lawmakers backing a bill that also provides about $200 million in grants to chipmakers said it’s needed to make Oregon more competitive in luring more of the multibillion-dollar semiconductor industry to the state. Other lawmakers argued that the measure is an attack on the nation’s first statewide policy — created a half-century ago — that limits urban sprawl and protects farmland and forests.
“These regulations have resulted in 50 years of success protecting our farm and forest lands, containing urban sprawl, and protecting natural resources,” said Republican state Rep. Anna Scharf. “Senate Bill 4 throws that out the window.”
The bill, which the state Senate approved last week and the House passed on a 44-10 vote Thursday, allows Democratic Gov. Tina Kotek to designate up to eight sites for urban growth boundary expansion — two that exceed 500 acres (202 hectares) and six smaller sites. The Oregon Farm Bureau was among the groups that opposed the bill.
“There is some extremely valuable farmland in the area that produces Oregonians’ food and provides those families and those employees jobs,” Scharf said. “Farmland, once it is paved over, can never be reclaimed.”
State Rep. Kim Wallan, a Republican and co-sponsor of the bill, said it gives the governor only narrow authority and is aimed at expediting the process for setting aside land for semiconductor factories, called fabs, and related businesses.
State officials and lawmakers were stung by Intel’s decision last year to build a $20 billion chipmaking complex in Ohio instead of Oregon, where suitable zoned land is scarce. Intel is the state’s largest corporate employer.
In Oregon, once land is included in an urban growth boundary, it is eligible for annexation by a city. Those boundary lines are regularly expanded, but the process can take months or even years. Under the bill, any appeals to the governor’s urban growth boundary expansions are expedited by going straight to the state Supreme Court.
Kotek’s office said Friday that she will sign the measure into law in the next few days. In a statement Thursday, Kotek said the bill makes Oregon “poised to lay the foundation for the next generation of innovation and production of semiconductors.”
“Oregon has been at the center of the semiconductor industry in the United States for decades,” Kotek said. “This bill is an absolutely essential tool for leading a coordinated effort with the private sector to ensure we can compete for federal funds to expand advanced manufacturing in Oregon.”
The CHIPS and Science Act that Congress passed last year provides $39 billion for companies constructing or expanding facilities that will manufacture semiconductors and those that will assemble, test and package the chips.
It was Republican Gov. Tom McCall, who served from 1967 to 1975, who urged lawmakers to push for a tough new land-use law. In a 1973 speech to the Legislature, he denounced “sagebrush subdivisions, coastal ‘condomania’ and the ravenous rampage of suburbia.” Lawmakers responded by passing the law that placed growth boundaries on Oregon’s cities.
Some opponents of the CHIPS bill objected Thursday to changing a system that’s been in place for 50 years.
“I cannot in good conscience give the governor what is essentially a super-siting authority to take lands and bring them into the urban growth boundary,” said state Rep. Ed Diehl, a Republican. “That is not the Oregon way.”
