Portland Weighs $150M Alaska Airlines Hangar Tax Break: 100 Jobs vs. Revenue Loss
Key Points
- 1The $150 million Alaska Airlines hangar project at PDX seeks a five-year, $1.8 million annual property tax abatement through an enterprise zone extension.
- 2The facility is projected to create 100 new jobs, including 60 high-wage aircraft maintenance technician roles with average salaries of $120,000.
- 3Alaska Airlines, the busiest carrier at PDX, says the new hangar will enable faster recovery for out-of-service aircraft, boosting operational efficiency.
- 4The proposal is being considered by the Portland City Council amid a city budget deficit of at least $66.9 million.
The Portland City Council is set to review a proposal for a tax abatement to support a major new Alaska Airlines maintenance hangar at Portland International Airport (PDX).
City councilors will consider extending the city’s enterprise zone. This extension would cover the site of the proposed $150 million aviation facility.
Economic Development and Tax Abatement
Prosper Portland, the city’s economic development agency, manages the enterprise zone program. These zones offer up to five years of property tax incentives. This is done in exchange for significant commercial aviation job creation.
For the Alaska Airlines maintenance hangar Portland project, the tax abatement would save the airline about $1.8 million annually. This property tax break would last for five years, according to a Prosper Portland official. The airline would continue to pay all other taxes and fees, including payroll taxes. After the five-year period, the property would be fully added to the tax roll.
This decision comes as the city faces a general fund budget deficit of at least $66.9 million. The short-term loss of property tax revenue is being weighed against long-term economic benefits.
Job Creation and Industry Impact
The new hangar is projected to create 100 jobs. This includes up to 60 positions for aircraft maintenance technicians.
These maintenance workers are expected to earn average salaries of $120,000. Additionally, 45 jobs for shipping and receiving workers would be created, earning up to $50,000. The facility would also employ as many as eight engineers, with salaries around $160,000.
Alaska Airlines currently employs 100 technicians at PDX. The airline is the busiest commercial carrier at the airport. It carried 5.3 million passengers through November, a 12% increase year-over-year.
Operational Benefits for Alaska Airlines
An Alaska Airlines official stated the new facility would significantly improve operations. The hangar would allow for faster recovery for out-of-service aircraft.
This enhanced capability is crucial for maintaining schedule reliability. It supports the airline’s growing presence at the Portland International Airport expansion hub. The new facility also emphasizes a continued commitment to the Portland community. It offers additional growth pathways for local Horizon Air maintenance operations technicians. Horizon Air is a subsidiary of the airline.
Alaska Airlines recently announced new flights from PDX. These additions include service to Baltimore, Philadelphia, St. Louis, and Idaho Falls.
Next Steps for the Proposal
The proposal will first be heard by the City Council’s Arts and Economy Committee. If it passes, it will then move to the full City Council for a final vote. The debate centers on balancing immediate budget concerns with a substantial, long-term economic development tax abatement that promises high-wage jobs and a major corporate investment in the city’s infrastructure.
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