Oregon Data Centers Race for Tax Breaks as Hillsboro Applications Surge Before Deadline

As a moratorium on tax breaks for data centers in Oregon is about to take effect, Hillsboro has received 18 zone tax break applications in recent weeks, according to the watchdog group Tax Fairness Oregon group.

The new legislation – House Bill 4084 – imposes a 12-month moratorium on new data center incentives in suburban and urban areas, effective next month.

Tax Fairness Oregon says that while enterprise zone property tax breaks are limited to five years in areas like Hillsboro, some of the new agreements signed by the city extend until 2051.

However, state law dictates that Hillsboro must approve tax break applications from companies meeting the minimum qualifications until the moratorium becomes effective.

Oregon Data Centers Will Receive $450 Million in Property Tax Breaks in 2026

According to local research, data centers in Oregon are projected to receive over $450 million in property tax breaks this year. Of that amount, $85 million applies to Hillsboro, even though data centers in the area provide relatively few jobs.

Figures released by Washington County state that a TikTok facility in Hillsboro employs 11 people, yet it will receive $5.5 million in property tax incentives in 2026.

Also in Hillsboro is the social media company X, which only employs 9 people but will be the beneficiary of $3.3 million in property tax breaks.

Oregon’s property tax exemptions for data centers are pegged at five years. However, this period can be extended if companies install new equipment or expand their facilities.
It also appears that data centers in rural areas and small towns in Oregon can have enterprise zone tax exemptions extended for up to 15 years.

State Law Does Not Prevent Data Centers From Seeking New Tax Breaks After Existing Agreements Expire

According to Hillsboro officials, state law does not prevent data centers from applying for new five-year property tax breaks when existing agreements expire, provided the companies are located inside a designated enterprise zone and meet all requirements.

Hillsboro is home to one of Oregon’s most densely concentrated data center areas, with 430 acres dedicated to the industry.