Sisters rated "distressed community"

Last updated Mar 25, 2008 12:0pm0

Sisters has received the dubious honor of having its name appear on the Oregon Economic and Community Development Department's (OECDD) list of distressed communities. The city is labeled "severely distressed," beaten out only by La Pine for the title of the most distressed community in Central Oregon.

The silver lining to the economic storm clouds is that the "severely distressed" designation has positive implications for economic development projects, loans and grants.

"There is an elephant in the room, and no one seems to have noticed it," said Lisa Clausen, owner of Sisters Movie House.

The designation is not a surprise to many of those who have attempted to bring businesses to Sisters.

"I am not surprised at all. We tried to provide a foundation for growth by creating a business park that could house the kinds of businesses that would provide a decent wage in the community. Peter Hall, (the developer of Three Sisters Business Park) tried the same thing, and we were both frustrated at every turn," said Shane Lundgren, developer of the empty property called Sun Ranch Business Park.

The problems for Sisters go beyond the opinions of local developers.

"The biggest problem that I see in Sisters is that no one is on the same page. A vision statement for Sisters growth is not providing any unifying vision. We would like to help, but until everyone is on the same page there is not a lot that we can do," said Eric Strobel, business development manager for EDCO (Economic Development for Central Oregon).

There has always been disagreement in Sisters over the key to prosperity.

"Some say the answer is affordable housing. We don't need affordable housing here as much as we really need jobs that will pay enough so that people can afford all the empty houses that are for sale everywhere in the community. We must bring in jobs here that will pay decent wages for the work force who lives here," said Lundgren.

And economic growth is not considered the brass ring by everyone in Sisters.

"I know there are a lot of people who are not very excited about seeing Sisters have strong growth and would rather see things remain as they are," said Strobel.

EDCO believes that the lack of industrial space is a key issue for Sisters.

"Until there is leasable space in Sisters that can accommodate startup manufacturing or tech businesses, they will continue to find homes elsewhere. That is the biggest single problem in Sisters right now and why some new businesses have started in Redmond or at the Sisters airport, rather than in the town," said Strobel.

The Sisters Area Chamber of Commerce sees the need a little differently.

"The (Sisters) vision statement is great, but the biggest problem is that we have no strategy to get from point A to Point B. Everyone is on a different page. We need somehow to become more unified and develop a strategy to get to our goals," said Michael Robillard, president of the Sisters Area Chamber of Commerce.

Solutions are not easy to come by.

"Some people want the city to step in. Others want the developers to do the work. Some want the chamber to take the burden. All those positions are wrong. We need to do this together, or it will not succeed. We need to get on the same page and develop a unified plan with everyone on board," said Robillard.

The city council is aware of a need, but it's not clear what course might be best to pursue.

"There are not a lot of good tools for a city of this size to encourage economic development," said mayor Brad Boyd. "If we could find some that would make sense and not put the existing local businesses at a disadvantage, the whole council would be on board."

Rating “distressed” communities

The State of Oregon first formed a methodology for determining levels of economic distress during the last decade. The law providing the authority to designate communities for the distressed list was passed in the late 1990s. With the passage of Senate Bill 932, the Oregon legislature directed the Oregon Economic and Community Development Department (OECDD) to give priority for grants and other economic aid to geographic areas designated as distressed.

During the 2007 legislative session, this statute was revised through Senate Bill 250 which directed the OECDD to: ". . . focus on Oregonians in communities that are rural, economically distressed or lack diverse employment opportunities...." The bill defines "economically distressed" as "a county, city, community or other geographic area that is designated as a distressed area by the department, based on indicators of economic distress or dislocation, including but not limited to unemployment, poverty and job loss."

This year saw a complete change in the methodology used to determine distressed status. The new methodology uses factors that provide for a more accurate determination of the financial health of a community or area than was possible with the previous methodology. The data now used in the determination is provided by the Oregon Employment Department and the U.S. Bureau of Economic Analysis.

The determination of whether or not an incorporated city or sub-city is specifically distressed in a non-distressed county, like Deschutes, is based on four factors: The city or sub-city's poverty rate (the percent of the population living in poverty); the city or sub-city's per capita personal income; the city or sub-city's percent of population aged 25-plus with college education; and the city or sub-city's unemployment rate.

Threshold values for the four factors are established, and if the values for three of these factors are worse than the threshold values, then that community is identified as distressed. If the values of all four factors are worse than the threshold values, as is the case with Sisters, the community is considered severely distressed.

Sisters weighed in on these factors as follows: Sisters has a well-educated population with more than 20 percent holding a bachelor's degree or higher, yet the average wage in Sisters is below $18,000 per year. Unemployment is 5.7 percent and rising. Finally, more than 10 percent of Sisters population lives below the poverty line.