Lane County settles tax dispute with manufacturer, reviving hopes for idled electronics factory – OregonLive
Hynix spent $1.5 billion on a computer chip factory that opened in Eugene in 1998. It closed 10 years later and has been idle since 2008. (File photo)Rob Romig/The Register-Guard via AP
Lane County has settled a property tax dispute with a company hoping to reopen a huge electronics plant in Eugene, clearing a path to restart production there as early as this fall.
The tax dispute had threatened to add millions of dollars to annual operating costs for an Ohio company called Stratacache, which bought the factory and its 200-acre site four years ago. Stratacache said the dispute could have blocked plans to reopen the plant, which has been closed since 2008.
With a settlement in hand, though, the company says it plans to go forward with plans to manufacture micro-LEDs there for digital signs and hire as many as 400 in the coming years.
“I am satisfied that we have resolution and continue forward movement,” said Chris Riegel, Stratacache’s CEO. He said the company and Lane County signed their deal Friday.
South Korean memory chip manufacturer Hynix spent $1.5 billion building and equipping the Eugene factory, which originally opened in 1998. It shut down a decade later amid a steep decline in the market for Hynix’s chips, laying off 1,400 workers.
The factory passed through a succession of owners in the intervening years until Stratacache bought the site in 2020 for $6.3 million. The pandemic snarled global supply chains and delayed plans to reopen the site.
Stratacache won $19 million in state funding last year to help finance the restart but then ran into a roadblock with the Lane County assessor.
Although the factory had been empty for more than a decade and Stratacache paid just $6.3 million for it, Lane County argued in filings with the Oregon Tax Court that the site’s taxable value was at least $29 million, and possibly as high as $50 million. Stratacache maintained the property had a taxable value of $11 million.
The two sides argued their case before the tax court last summer. Stratacache’s plans and the site’s future have been in limbo for months pending the court ruling. The court says it typically takes six to nine months to rule.
On Friday, though, Stratacache and Lane County opted to settle on a $16 million valuation. The company says its operations can support the taxes associated with that figure and now plans to finalize its incentive deal with Oregon later this month. The initial valuation is likely to increase if the factory does return to operation and if Stratacache installs manufacturing tools.
“Lane County is pleased to have tentatively resolved the matter of valuation with Stratacache,” county spokesperson Devon Ashbridge said in a written statement. Ashbridge did not respond to questions about why the county settled or how it arrived at the settlement’s $16 million valuation.
About 30 people work at the site now. Stratacache hopes that number will grow to around 100 this fall, provided the company secures the production tools it requires.
“Everybody’s having the same problem,” Riegel said. “Tool availability, it’s a challenge industrywide and we’re not exempt from that.”
Stratacache hopes to start full production late in the year or sometime in 2025, he said, steadily ramping up its workforce to approximately 400.
“The industry’s maturing quite nicely and we see a lot of opportunity there,” Riegel said.
This article has been updated with comment from Lane County.
— Mike Rogoway covers Oregon technology and the state economy. Reach him at [email protected] or 503-294-7699
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