OSCC Legislative Updates

 

2017 Legislative Report - Week 15

 

 

Dear OSCC Members and Colleagues - 

Here's a week 15 recap of key issues in the Oregon legislature.

Key Labor Bills:

Predictive Scheduling: SB 828 implements predictive scheduling for food service, retail and hospitality businesses. As part of the bill, business is seeking a total, permanent statewide ban on local scheduling mandates. Unions are coalescing to try and pass this bill as it is their last major opportunity to pass 'pro-worker' legislation. The bill is dormant - for now, however OSCC expects that this will resurface and become a major issue in the waning days of session.

Wage Equity: HB 2005 would mandate wage equity among all protected classes for similar jobs. The problem with the bill for business is that it is broadly applied to all Oregon protected classes, it adds a new protected class (armed services veterans), it includes punitive damages, and that each paycheck for which a discrimination is claimed represents its own claim for damages. The bill was amended this past week in the Senate to be slightly more employer-friendly (more affirmative defenses) and to include more bona fide business reasons for wage disparities. Some business groups are now even supporting the legislation. At the very least, it's a more palatable bill than the one that passed the House.

BOLI Overtime Fix: SB 984 fixes BOLI's bad interpretation on daily/weekly overtime pay and passed the Senate unanimously. It's a good bill, but the unions may negotiate a heavy price for this bill in the House including a hard cap on hours that an employee may work at 60/hours per week. OSCC believes this could have a severely damaging effect on food producers. OSCC is expecting a new bill to be introduced in the House this week to encompass all the elements. OSCC will be seeking member feedback.

Union Organizing & Sick Leave Penalties: HB 2856 OSCC is working to kill a nasty little bill, which creates a Community Outreach and Labor Education Program within BOLI to promote awareness of employee rights. The bill takes $2 million of employer-paid money (Wage Security Fund) to establish the program. If that weren't bad enough, the bill also adds punitive damages to Oregon's mandatory paid sick leave law. OSCC is actively working to oppose this bill in the Ways & Means Committee.

Environmental Regulation:

Cleaner Air Oregon: HB 2269 This big bill would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme. This will likely be the big environmental fight of the session. If the 'Cleaner Air Oregon' regulations are allowed to go forward, it will put many manufacturers out of compliance and may prove very costly for local business communities. OSCC will keep members apprised. OSCC testified in opposition to HB 2269 last week in the Ways & Means Natural Resources subcommittee.

Liability:

Liability Costs / Damage Awards: SB 737, which would eliminate the $500k cap on non-economic damages in civil lawsuits (product liability, negligence, personal injury, etc.), is the trial lawyer's top priority for 2017. We defeated it on the Senate floor earlier this month, but the bill was sent back to the Senate Rules committee, where we expect it will continue to get attention until the final gavel drops. This is a key business bill and OSCC will be paying close attention to it until the end.

Business Taxes:

OSCC is actively engaged in the business tax reform discussion with Senator Mark Hass. There are several competing proposals to reform business taxes, all of which contemplate a new Gross Receipts Tax (GRT).

Senator Hass is contemplating a GRT at about 0.48% for all businesses with more than $1 million in Oregon sales. He has explicitly stated he will not entertain Speaker Kotek's and House Democratic Leadership's proposal of 0.95%.

OSCC wants to emphasize that these discussions are extremely fluid and there is nothing set in stone. Any GRT proposal at this stage would be predicated on budget cuts/government efficiencies that are not materializing at this point.

Small Business Tax Cut: OSCC is particularly concerned about SB 164, which limits the 2013 small business tax cut to just a few traded sector industries. Even worse, the amendments we've seen says that a business must have at least 10 employees to receive the tax cut. OSCC testified in opposition to the changes in SB 164 that are aimed at reducing the ability for small business to claim the reduced tax rates. OSCC believes the small business tax cut should be expanded to include sole proprietors and not limited to larger-sized small businesses.

Tax Disclosure: HB 2019 is very troubling for OSCC. It would require any business that claims $1,000 or more in state tax credits to disclose certain tax information such as Oregon sales, Oregon taxable income, and Oregon tax liability. OSCC is very concerned about a state policy that publicizes confidential tax information and gives activists a platform to politicize corporate tax returns.

Government Cost Savings:

PERS reform, health care cost savings, state hiring freezes, etc. Proposals and ideas are being tossed around loosely but there has been absolutely no concrete policy development or leadership around any of these ideas. This is important because business has made a point of saying that there will be no entertainment of revenue increases unless there are concrete proposals to reduce the state government cost structure. Stay tuned here. The substance behind any of these 'cost containment' proposals will ultimately be the key to how the budget gets balanced.

Transportation:

A 10-year, $10 billion transportation package was unveiled for the first time last week. The proposal relies on gas taxes, registration fees, and payroll taxes to add more capacity to I-5 and I-205 and other major projects. Now that a straw man proposal has been released, the discussions start in earnest. OSCC will keep members apprised, but the $1 billion per year in added taxes will be a very heavy lift.

Best regards,

Alison Hart
Executive Director
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503-231-5421 

JL Wilson
Legislative Counsel
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503-363-2182

 

2017 Legislative Report - Week 14

 

 

Dear OSCC Members and Colleagues - 

Week 14 of the 2017 Oregon legislature was perhaps the quietest of the session to date.

Policy bills are largely lying dormant.

The biggest issue of the week was undoubtedly the House Democratic Leadership's announcement of their 2017 'Tax and Fiscal' Plan

The plan outline?

  • $400 million in undefined state government cost containment strategies (PERS, state employee health care, etc)
  • $250 million in one-time undefined cuts to the state budget
  • $3 BILLION IN CLEARLY DEFINED NEW TAXES ON BUSINESS

In exchange for $650 million in undefined cost reductions, Speaker Kotek and House Leadership are asking businesses to pay a 0.95% gross receipts tax on all Oregon sales above $5 million - a $3 billion new tax on Oregon businesses.

OSCC is going to pay close attention as this develops. There are now several competing tax and spending plans - none of which has real support. But we expect that the plan unveiled by House Leadership will be a major factor in end-of-session negotiations.

Here are the bills we are most paying attention to for OSCC members:

Key Labor Bills:

SB 301: would effectively preclude employers from enforcing zero tolerance drug policies. As of late last week, this bill is now officially dead!

SB 828: implements predictive scheduling for food service, retail and hospitality businesses. OSCC is seeking legal guidance on how the bill would apply to OSCC businesses that have ancillary retail or food service positions. SB 828 will be the focus of a lot of pressure from union groups. They are coalescing to try and pass the bill as it is their last major opportunity to pass 'pro-worker' legislation.

HB 2005wage equity - would mandate wage equity among all protected classes for similar jobs. The problem with the bill for business is that it is broadly applied to all Oregon protected classes, it includes punitive damages, and each paycheck for which a discrimination is claimed represents its own claim for damages. We believe this bill will spur considerable class action claims. But we also believe we have an opportunity to amend some of the worst aspects of the bill to make it more workable.

HB 3087paid family leave - would implement a .5% payroll tax on employers to fund the $800 million/yr program that grants 12 weeks of paid leave. OSCC believes this bill is dead although it will likely continue to receive hearings during the session.

SB 984: which fixes BOLI's bad interpretation on daily/weekly overtime pay passed the Senate unanimously. Good bill, but the unions may negotiate a heavy price for this bill in the House including a hard cap on hours that an employee may work at 60/hrs per week. OSCC believes this could have a severely damaging effect on some manufacturers. We will work to eliminate this provision if possible.

Environmental Regulation:

The big bill here is HB 2269, which would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme, was voted out of committee on a 5-4 party-line vote and sent to the Ways & Means Committee. This will likely be the big environmental fight of the session. If the 'Cleaner Air Oregon' regulations are allowed to go forward, it will put nearly all manufacturers out of compliance. OSCC will keep members apprised. OSCC is actively opposing this bill and is lobbying legislators.

Tourism:

HB 2064: This bill could potentially be amended in the House Revenue Committee to allow local governments to spend more TRT funds on 'tourism-related' projects not directly tied to tourism promotion. The Oregon Restaurant & Lodging Association sent out an alert on this issue last week, but we have not seen it appear on any committee agenda. OSCC will be watching this.

Liability:

SB 737: which would eliminate the $500k cap on non-economic damages in civil lawsuits (product liability, negligence, personal injury, etc.), is the trial lawyer's top priority for 2017. We defeated it on the Senate floor, but the bill was sent back to committee, where we expect it will continue to get attention until the final gavel drops. This is a key business bill.

Taxes & Budget:

Senate Revenue Chair Mark Hass (D-Beaverton) did, in fact, unveil his new corporate tax proposal this past week, but it was overshadowed by the announcement from House Democratic leadership of their plan to increase business taxes by nearly $3 billion. 

Senator Hass has not abandoned his push for a gross receipts tax, and by comparison to the House leadership plan, it looks downright modest. Hass is proposing a 'Commercial Activities Tax' somewhere in the neighborhood of 0.25% to 0.75% with a corresponding elimination of corporate income taxes and a lowering of personal income taxes.


But Senator Hass' plan was not nearly as detailed as the House Leadership plan.  There are many details left to be worked out. But the effect of the House Democratic leadership plan is that they clearly do not believe that Hass' plan raises enough money. The two competing plans are clearly at odds with each other.

One final note...OSCC wants to caution that the odds of passage for any such tax proposal are very long. Yes, the proposals are startling and it's easy to assume given recent history that OSCC members will see these taxes foisted upon them by an unsympathetic legislature.

But in reality, there is not enough support for any of these taxes. With respect to taxes, Republican legislators have enough leverage to defeat tax increases.  Republicans are already adamant that the state should not by levying more taxes when revenue is increasing 10% per biennium without any new tax revenue.

There also hasn't been a serious effort yet to curb state spending that business groups would require for any new revenue.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
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503-363-2182

2017 Legislative Report - Week 13

 

 

Dear OSCC Members and Colleagues - 

There are very few real bills of consequence to OSCC members that are still under consideration.

The biggest issues still outstanding are (1) business taxes, (2) transportation funding, (3) predictive scheduling legislation, and (4) increased DEQ fees that would help implement a new regulatory scheme - 'Cleaner Air Oregon' - that OSCC is opposing.

In addition, there are a handful of opportunities to do a few good things for business ... the chance to overturn a recent BOLI interpretation that forces double overtime payments, the opportunity to execute a rational approach the regulation of diesel engines, and opportunity to solve the state's $1.8 billion budget hole with meaningful cost reductions that would put state government on a path to affordability and sustainability.

Here's what we know from the past week:

Governor Brown unveiled her own cost containment proposal. This was the biggest story of the past week. She proposed selling off or borrowing against state assets to buy down the PERS unfunded liability. She also proposed ramping up debt collection from taxpayers and vendors as well as taking a harder line in contract negotiations with government employee unions.

Governor Brown has already announced a 2-month hiring freeze as the state closes out its 2-year budget cycle on June 30th.

In addition to her recommendations, Governor Brown also proposed leading an expert panel on state financial matters that would study, among other things, various PERS reform proposals. It is unknown how much, if anything, the Governor's proposals would save.

The Governor's announcement was widely viewed as underwhelming, and another exercise in trying to pare back state spending without having to make a tough decision.

The Governor's announcement came on the heels of the first presentation by the legislative "Cost Containment" workgroup, which was also underwhelming. Very few specifics emerged. A lot of academic discussion on PERS reform and curtailing state hiring, but most of those ideas seemed to be met with great resistance. 

It will be interesting to see if anything of substance emerges as a way to curb the escalating costs of state government. Time is starting to slip away and the proposals to date have lacked specificity or substance.

Here are the bills we are most paying attention to for OSCC members:

Labor:

SB 301: would effectively preclude employers from enforcing zero tolerance drug policies. Although the bill passed out of Senate Judiciary on a 3-2 party-line vote, OSCC immediately went to work to defeat the bill. Although we have been assured the bill will be sent back to committee to die, we haven't seen confirmation.

SB 828: implements predictive scheduling for food service, retail and hospitality businesses. OSCC is seeking legal guidance on how the bill would apply to OSCC businesses that have ancillary retail or food service positions. SB 828 will be the focus of a lot of pressure from union groups. They are coalescing to try and pass the bill as it is their last major opportunity to pass 'pro-worker' legislation.

HB 2005: wage equity - would mandate wage equity among all protected classes for similar jobs. The problem with the bill for business is that it is broadly applied to all Oregon protected classes, that it includes punitive damages, and that each paycheck for which a discrimination is claimed represents its own claim for damages. We believe this bill will spur considerable class action claims.

HB 3087: paid family leave - is still alive in the House Revenue Committee. The bill implements a .5% payroll tax on employers to fund the $800 million/year program that grants 12 weeks of paid leave. We don't believe this bill will advance any further.

SB 1040: would implement local union security agreements and prevent local right to work measures. The bill passed the Senate and is now in the House.

SB 984: fixes BOLI's bad interpretation on daily/weekly overtime pay passed the Senate unanimously. Good bill, but the unions may negotiate a heavy price for this bill in the House.

Environmental Regulation:

One key 'cap and trade' bill is now dead - SB 557. The other, HB 2135, was kept alive, barely. OSCC will continue to keep watch on HB 2135 although we have every reason to believe the bill will die this session.

SB 1008: the costly mandate for diesel engine retrofits and replacements, was stripped down to require the state to take inventory of diesel engines operating in Oregon with no additional regulation. This is a reasonable approach that OSCC can support. But we are skeptical that SB 1008 will move forward in this form.

The big bill here - HB 2269 - which would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme, was voted out of committee on a 5-4 party-line vote and sent to the Ways & Means Committee. This will likely be the big environmental fight of the session. OSCC will keep members apprised.

HB 2236 requires the DEQ to conduct a study and develop recommendations relating to emissions of air contaminants from industrial sources. We are keeping a watch on this dormant bill because it could be used to do some bad things.

Liability:
SB 737: would eliminate the $500k cap on non-economic damages in civil lawsuits (product liability, negligence, personal injury, etc.), is the trial lawyers top priority for 2017. We defeated it on the Senate floor early last week. The bill was sent back to committee, where we expect it will continue to get attention until the final gavel drops.

Taxes & Budget:

Senate Revenue Chair Mark Hass (D-Beaverton) has said that he will unveil his new corporate tax proposal this week. Despite all the pushback from business, Hass has not abandoned his push for a gross receipts tax. OSCC anticipates that Hass will propose a 'Commercial Activities Tax' somewhere in the neighborhood of 0.5% with a corresponding elimination of corporate income taxes.

We will inform OSCC members of the specifics of Hass' plan when it is unveiled this week.

But we also want to caution that the odds of passage for any such tax proposal are very long. For starters, there hasn't been a serious effort yet to curb state spending that business and Republicans would require for any new revenue.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
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503-363-2182

 

2017 Legislative Report - Week 12

 

Dear OSCC Members and Colleagues - 

The April 18th committee deadline is now behind us. We know everything that's in play. All in all, OSCC members are in far better shape than in previous sessions.

Yes, there are a handful of threats to the general business community - predictive scheduling, taxes, and a 'Cleaner Air Oregon' regulatory scheme that could threaten business operations, but those threats are relatively limited compared to what we've seen in the past.

There are also a few opportunities... the chance to overturn a recent BOLI interpretation that forces double overtime payments, the chance to execute a rational approach the regulation of diesel engines, and a chance to solve a $1.8 billion budget hole with no general business taxes.

Here's what we know from the past week:

The tax/revenue environment is very fluid. As we said last week, OSCC has reason to believe that the emerging strategy of the legislative leadership is to pass an "all cuts" budget and then refer a tax increase measure to the ballot in order to add back programs that will be cut in the newly-adopted budget.

But it looks like this strategy simply has too many holes to work. For one, the Democratic majority likely won't have the votes to pass the necessary cuts without Republicans. Also, any attempt to refer a tax measure to the ballot would also likely require a 3/5 supermajority. Quite simply, this won't happen.

Business opposition is growing against a gross receipts tax... so much so that we no longer believe it is a viable option.

The legislative "Cost Containment" workgroup made their first presentation on Friday. In a word, it was underwhelming. Very few specifics emerged. There was a lot of academic discussion on PERS reform and curtailing state hiring, but most of those ideas seemed to be shot down immediately by members of the Ways & Means panel. It gave the distinct impression that there was not a single thing the state could do to slow down escalating costs.

PERS Reform was kept alive, but barely, and certainly not in a manner that would suggest that there will be a serious effort to implement any cost saving reforms to the state pension program. After 10 weeks of discussion, both PERS reform bills, SB 559 and SB 560, were sent to Ways & Means unamended and with no recommendation - hardly a prescription for success.

Here is the fate of the bills of concern to OSCC members:

Labor:
SB 301 would effectively preclude employers from enforcing zero tolerance drug policies. Although the bill passed out of Senate Judiciary on a 3-2 party-line vote, OSCC immediately went to work to defeat the bill. It is being sent back to committee where it will die.

SB 828 / HB 2193 would implement predictive scheduling for food service, retail and hospitality businesses. Both bills are alive. SB 828 will be the focus of a lot of pressure from union groups. They are coalescing to try and pass the bill.

HB 3087: paid family leave - is still alive in the House Revenue Committee. The bill implements a .5% payroll tax on employers to fund the $800 million per year program that grants 12 weeks of paid leave.

SB 292: unlawful employment action for "workplace bullying," is now dead.

SB 1040 and HB 3420 would implement local union security agreements and prevent local right to work measures. Both bills are still alive.

SB 997 would levy fines on all employers with 50 or more employees whose employees opt to enroll on the Oregon Health Plan. This bill is now dead.

SB 984, which fixes BOLI's bad interpretation on daily/weekly overtime pay was sent to the Senate floor for a vote. 

SB 329, which preempts local employment law mandates, was also kept alive. 

Energy & Environment:

One key 'cap and trade' bill is now dead - SB 557. The other, HB 2135, was kept alive, barely. OSCC will continue to keep watch on HB 2135.

SB 1008, the costly mandate for diesel engine retrofits and replacements, was stripped down to require the state to take inventory of diesel engines operating in Oregon with no additional regulation. This is a reasonable approach that OSCC can support. SB 1008 was kept alive.

HB 2669: 'Community Right to Know' - was killed. This bill would have allowed local jurisdictions to implement their own 'Right to Know' chemical inventory programs and would have allowed local governments to levy annual fees up to $10,000 on regulated businesses.

Air Quality:

The big bill here - HB 2269 - which would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme, was voted out of committee on a 5-4 party-line vote and sent to the Ways & Means Committee. This will likely be the big environmental fight of the session.

HB 2236 was also kept alive, which requires the DEQ to conduct a study and develop recommendations relating to emissions of air contaminants from industrial sources.

SB 197 - a disaster for the dairy industry - allowed the DEQ to adopt a program for regulating air contaminant emissions from dairy confined animal feeding operations. This bill is now dead.

Tourism and TRT Funding:

Both HB 2744 and HB 2768 were killed in the House Economic Development and Trade Committee. These bills would have allowed local government much more latitude to spend state TRT money on 'tourism-related' projects not related directly to tourism promotion. The bills pitted local governments against the Restaurant, Lodging and Hospitality industry. In the end, they fought to a stalemate and the bills did not advance.

HB 3260 authorizes coastal counties to impose local transient lodging taxes on residential short-term vacation rental properties by submitting the issue to county voters. This bill is still very much alive.

Liability:

SB 737 (formerly 487), which would eliminate the $500k cap on non-economic damages in civil lawsuits, passed out of the Senate Judiciary Committee on a party-line vote. As of right now, we expect this to be the first major bill of the session to be defeated and sent back to committee. We are expecting a vote this week.

HB 2169 would have disallowed attorney fees for employers who prevail in wage disputes with employees. Current law allows the prevailing party to collect attorney fees. HB 2169 is now dead.

Taxes & Budget:

As we suggested last week, the House Revenue Committee is taking up the issue of corporate tax disclosure for any company that avails itself to a business tax incentive. The bill is House Bill 2019. We now believe that this bill is a legitimate threat. Any company that receives $500 or more in business tax incentives will be subject to disclosure on Oregon sales, Oregon taxable income and Oregon tax liability.

We also reiterate our belief that there will be a real attempt to scale back the small business tax cut passed by the legislature in 2013. This is one issue that we expect that Republicans may assist Democrats in raising revenue. Republicans have shown a willingness to consider eliminating the lower tax rates for LLP's. The bills to watch here are SB 164 and SB 165.

Also of note, all tax and budget issues are still alive. Any tax bill residing in the Revenue Committees, or budget bill residing in Ways & Means, is not subject to deadlines. OSCC will monitor these bills until the very end of session. 

As we noted last week, OSCC expects that the Ways & Means Committee will be engaged in an inordinate amount of policy work this session as committee chairs have now punted critical policy bills to Ways & Means to keep them alive.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

2017 Legislative Report - Week 11

 

 

Dear OSCC Members and Colleagues - 

We are going to take a pause this week and let things settle.

Monday and Tuesday are going to be the single busiest set of days for committees as they rush to pass bills to beat the Tuesday deadline (all bills must pass out of their original committee by Tuesday at 11:59 pm). At this point we are all mostly spectators. 

We have never seen anything like we're witnessing now. The unprecedented logjam of bills waiting for passage on the final day will undoubtedly be a spectacle - and there will be casualties. There's just too many bills and too little time. In some cases, committees are scheduling 40-50 bills for a committee vote in their final 2-hour committee.

Next week's report will be more definitive, but let's recap what we do know.

Here's what we know from the past week:

It was another interesting week on the tax/revenue front. OSCC has reason to believe that the emerging strategy of the legislative leadership is to pass an "all cuts" budget and then refer a tax increase measure to the ballot in order to add back programs that will be cut in the newly-adopted budget.

This strategy has many holes, not the least of which is that there are probably not enough Democratic votes to pass the kind of cuts that this strategy will require (we can guarantee that no Republican will assist in this strategy).

But nonetheless, it was a significant departure from the bipartisan, cooperative tone that had defined the first two months of the session, most notably in the Senate.

Here are the bills that are still alive as we approach the Tuesday, April 18th deadline:

Labor:
SB 301: would effectively preclude employers from enforcing zero tolerance drug policies. We are deeply disappointed this bill has been kept alive in Senate Judiciary. Scheduled for a vote on Tuesday.

SB 828 / HB 2193: would implement predictive scheduling with amendments mainly targeting hotels, restaurants and retail establishments. We were disappointed to see both the House and the Senate bill kept alive. SB 828 is scheduled for a vote on Monday, as is HB 2193.

HB 3087: Paid family leave, which would require 12 weeks of leave for qualifying events and is slated to be funded by .5% tax on employees and .5% payroll tax, is scheduled for a committee vote on Tuesday.

SB 292: unlawful employment action for "workplace bullying," was mysteriously kept alive in Senate Judiciary. Scheduled for a vote on Tuesday.

SB 1040: would implement local union security agreements and prevent local right to work measures. Scheduled for a vote on Monday.

SB 997: was kept alive. The bill would levy fines on all employers with 50 or more employees who do not provide private health insurance for employees. Scheduled for a vote on Tuesday.

On the good side, both SB 984 (fixes BOLI's bad interpretation on daily/weekly overtime pay) and SB 329 (preempt local employment law mandates) were kept alive. Both are scheduled for votes on Monday.

Energy & Environment:

One key 'cap and trade' bill is now dead, SB 557. The other, HB 2135, is still alive and scheduled for a vote on Monday.

SB 1008: the costly mandate for diesel engine retrofits and replacements - is still alive and scheduled for a vote on Monday.

On the good side, HB 2669, 'Community Right to Know' was killed.

Air Quality:

The big bill here, HB 2269: which would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme was voted out of committee on a 5-4 party-line vote and sent to the Ways & Means Committee.

HB 2236: was also kept alive which requires the DEQ to conduct a study and develop recommendations relating to emissions of air contaminants from industrial sources.

SB 197: a disaster for the dairy industry - is scheduled for a vote on Monday. It allows for the DEQ to adopt a program for regulating air contaminant emissions from dairy confined animal feeding operations. We believe this bill will die, but will confirm next week.

Liability:
SB 737 (formerly SB 487): which would eliminate the $500k cap on non-economic damages in civil lawsuits, passed out of the Senate Judiciary Committee on a party-line vote. As of right now, we expect this to be the first major bill of the session to be defeated and sent back to committee. Stay tuned on this one.

Taxes & Budget:

OSCC has reason to believe now that the House Revenue Committee will take up the issue of corporate tax disclosure, HB 2019. We have not seen the amendments, but we believe now that this will be a legitimate threat.

We also believe there will be a real attempt to scale back the small business tax cut passed by the legislature in 2013. This is one issue that we expect that Republicans may assist Democrats in raising revenue. Republicans have shown a willingness to consider eliminating the lower tax rates for LLP's. The bills to watch here are SB 164 and SB 165.

Tourism and TRT Funding:

HB 3260: authorizes coastal counties to impose local transient lodging taxes on residential short-term vacation rental properties by submitting the issue to county voters. The bill has received some attention in the House Revenue Committee and is still alive.

Breaking new on Tourism and TRT Funding (as of 10am today):

The House Committee on Economic Development & Trade did not move forward with either HB 2744 and HB 2768. These bills are now dead.

HB 2744: amended the definition of "tourism-related facility" to include improvements to real property that have the substantial purpose of supporting, promoting or accommodating tourism or tourist activities.

HB 2768: expanded the definition of "tourism promotion" for purposes of local transient lodging tax revenue expenditures.

Also of note, all tax and budget issues are still alive. Any tax bill residing in the Revenue Committees, or budget bill residing in Ways & Means, is not subject to deadlines. OSCC will monitor these bills until the very end of session.

OSCC expects that the Ways & Means Committee will be engaged in an inordinate amount of policy work this session as committee chairs punt critical bills to Ways & Means to keep them alive.

Again, OSCC will give you a precise accounting for all the bills that will remain in play after the Tuesday deadline. It will easily be the most active two days of the session this week, but after April 18th, OSCC will have a very solid understanding of all the bills in play for 2017 and will be able to focus efforts appropriately.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report - Week 10

 

 

Dear OSCC Members and Colleagues - 

So much for big deadlines. The first major deadline produced almost no changes to OSCC's outlook for the week.

All bills needed to be scheduled for a vote in their original committee by Friday, April 7th. Nearly every single bad bill was scheduled. Almost nothing fell off of our radar. Committee chairs just couldn't bring themselves to tell anyone "NO," and consequently, nearly every bill was kept alive until April 18th.

We will be working feverishly until the 18th, when all bills must pass their original committee. Our hope is to neutralize many of the bad bills (and hopefully pass a few good ones) between now and the 18th. See the links below for bills and amendments, hearing schedules, and recorded testimony.

Here's what we know from the past week:

It was an interesting week on the tax/revenue front. The week started with a press conference from the government employee unions imploring the legislature to pass a "game changing" tax increase on Oregon businesses. By Wednesday, TV ads were running in opposition to the legislature's consideration of a new gross receipts tax. And by this weekend, Senator Mark Hass, Chair of the Senate Finance Committee, was blasting those TV ads as 'amateur' and 'lazy.' The OSCC assessment is still the same. We are skeptical that the legislature will embark on a corporate tax increase. We believe that increased tax revenues from a growing economy will take enough pressure out of this budget cycle to allow legislators to cobble together a budget without a general tax hike.

Here are the bills that are still alive as of the Friday, April 7th deadline:

Labor:
SB 301 would effectively preclude employers from enforcing zero tolerance drug policies. We are deeply disappointed this bill has been kept alive in Senate Judiciary.

SB 828 / HB 2193 would implement predictive scheduling. We were disappointed to see both the House and the Senate bill kept alive. SB 828 has been modified with amendments that are still unacceptable to OSCC and we will continue to strongly oppose.

HB 3087 - paid family leave - was kept alive.

SB 292 - unlawful employment action for "workplace bullying," was mysteriously kept alive in Senate Judiciary.

SB 1040 would implement local union security agreements and prevent local right to work measures.

SB 997 was kept alive. The bill would levy fines on all employers with 50 or more employees if any employees working 20 hours or more are not privately covered with employer-sponsored health insurance. 

On the good side, both SB 984  (fixes BOLI's bad interpretation on daily/weekly overtime pay) and SB 329  (preempt local employment law mandates) were kept alive.

Energy & Environment:
The key 'cap and trade' bills were all kept alive - SB 557  and HB 2135.

SB 1008 - a costly mandate for both on-road and off-road diesel engine retrofits and replacements - was kept alive.

On the good side, 'Community Right to Know' that would have increased regulatory programs on chemical storage reporting - HB 2669 was killed. 

Air Quality:

The big bill here - HB 2269 - which would increase Title V and ACDP fees to fund the new DEQ 'Cleaner Air Oregon' regulatory scheme was kept alive.

HB 2236 - requiring the DEQ to conduct a study and develop recommendations relating to emissions of air contaminants from industrial sources was also kept alive.

SB 197 - allowing for the DEQ to adopt a program for regulating air contaminant emissions from dairy confined animal feeding operations - a disaster for the dairy industry - was kept alive. 

Tourism and TRT Funding:

Both HB 2744 and HB 2768 were kept alive in the House Economic Development and Trade Committee. These bills would allow local government much more latitude to spend state TRT money on 'tourism-related' projects not related directly to tourism promotion.

Liability:
SB 737 (replacing SB 487), which would eliminate the $500k cap on non-economic damages in civil lawsuits, passed out of the Senate Judiciary Committee on a party-line vote. It is expected to be the first real showdown of the session in the Senate in which a close vote is expected.

Transportation:

The much anticipated transportations funding package is not affected by session deadlines.

SB 115 - the bill that would prohibit leaded aviation fuel - died.

Taxes & Budget:

All tax and budget issues are still alive. Any tax bill residing in the Revenue Committees, or budget bill residing in Ways & Means, is not subject to deadlines. OSCC will monitor these bills until the very end of session.

OSCC will keep you informed on how these bills unfold over the next ten days. It will easily be the most active ten days of the session. However, after April 18th, OSCC will have a very solid understanding of all the bills in play for 2017 and will be able to focus efforts appropriately.

This is where the rubber hits the road. We will most likely be reaching out for testimony from Chambers and their members during this time. Please be prepared to act quickly.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report - Week 9

 

 

Dear OSCC Members and Colleagues - 

The next 2 ½ weeks are traditionally among the most important of the legislative session. This is where we start to see bills formally die, which means OSCC can focus on areas of most importance during the second half of the session.

All bills must be scheduled for a vote in their original committee by this coming Friday, April 7th. Furthermore, all bills must pass their original committee by April 18th. 

Historically, this has been the most meaningful set of deadlines as most legislation will fall by the wayside. But as we've warned, gamesmanship will also keep many bad bills alive until the very end. OSCC will keep you fully apprised, but we also look forward to seeing some potential threats go away.

Here's what we know from the past week:

OSCC continues to believe that there are not enough votes to pass any sort of tax increases - with the exception of a gas tax (for a transportation package) and a health care provider tax (to fund state Medicaid). No matter what you read in the Oregonian (this article actually goes into great depth on the issue), we are very hard pressed to believe that there are enough votes for any tax increases beyond these two taxes.

And while we believe that the legislative leadership will give serious consideration to referring a gross receipts tax to the ballot, perhaps as soon as November of this year, we are still very skeptical that the stars would line up to actually follow through with this. Business would likely oppose, and the magnitude of the tax likely wouldn't be enough to get the unions interested in funding another pro-tax measure.

OSCC opposes HB 2269, which would increase fees by up to 20% on Title V and ACDP holders in order to provide start-up funding for the DEQ's and OHA's 'Cleaner Air Oregon' regulatory program. OSCC testified in opposition to this bill as the 'Cleaner Air Oregon' regulatory framework issued by DEQ would likely result in many Oregon manufacturers being unable to meet the standards. OSCC is also concerned that the program will require ever increasing financial commitments from regulated companies. The opposition to these start up fees for the DEQ is becoming a central focus of OSCC and the business community. We will keep you apprised.


OSCC testified in favor of SB 984, which would legally overturn BOLI's recent interpretation that manufacturing employers are subject to both the state's 10-hour daily overtime rate and the federal 40-hour weekly overtime rate. BOLI's new interpretation means that daily and weekly overtime hours are double counted.  While OSCC hopes that SB 984 gains traction, it will be difficult. The unions are strongly opposed. OSCC is lobbying.

After almost 60 days, the Oregon House finally passed a bill that was strongly opposed by the business community. HB 2005 would mandate 'pay equity' for all protected classes, would switch the burden of proof from plaintiff to employer, and would implement new punitive damages and make each paycheck in which a disparity is claimed as a cause for remedy. Although business offered a generous compromise based on a California version of the law, it was rebuffed by House democratic leadership. The 'pay equity' legislation passed by the House is the most punitive in the nation. It will now go to the Senate for consideration.

Although we mentioned it last week in our report, business groups were caught flat-footed at the Senate Bill 997 hearing. Only the unions testified.  This bill would penalize employers with 50 or more employees if any employees working 20 or more hours per week are not privately covered with employer-sponsored health insurance. And while we said that we did not expect this bill to advance, it looks, in fact, that business will have to make up ground and rally to push back on this bill.

Here's what's coming up this week:

Paid Family Leave proposal is scheduled for a work session in committee this week. House Bill 3087 implements a 0.5% income tax on employees and 0.5% payroll tax on employers to fund a 12-week paid family leave program on business of all sizes. Because the program is funded with a tax, the legislation requires a 3/5th supermajority of legislators to approve it. This gives business considerable leverage in defeating the proposal. We do, however, believe that the proposal will be kept alive. However, because HB 3087 requires a supermajority of the legislature to approve, we have good reason to believe that the unions are now turning their attention to predictive scheduling (SB 828) as their primary target for 2017.

Speaking of SB 828, the bill will receive another full public hearing in the Senate Workforce Committee this week. There will be new amendments introduced at the hearing. Here's what we know about them:

  • The amendments will focus exclusively on hotels, restaurants and retail establishments. The provisions from the original bill (Section 3) that implemented wage requirements on all employers who changed or shortened shifts are deleted.
     
  • The bill focuses exclusively on retail, food service, restaurants and hotel employees of businesses with 25 or more employees. OSCC believes that this will encompass many of our local chamber members and OSCC will strongly oppose the new amendments.

Senate Bill 487 is scheduled for a work session this week. This bill increases non-economic damage awards in personal injury and wrongful death lawsuits. It will have major repercussions on health care providers as well as the commercial liability market. 

Several OSCC members have inquired, with concern, about SB 115, which would ban the use of leaded aviation fuel. This bill is being considered again this week - with amendments - that would allow the state Department of Agriculture to set a date to prohibit leaded aviation fuel no sooner than 5 years after the FAA approves an alternative aviation fuel that does not contain lead. Please let us know if you have a concern with this approach.

Of particular interest to OSCC members:

The public record is being held open on Senate Bill 828 - predictive scheduling - until COB Tuesday, April 4th.  OSCC members are strongly urged to submit testimony in opposition to the legislation at this email address:  This email address is being protected from spambots. You need JavaScript enabled to view it.

SB 828 would be devastating for some OSCC members. For OSCC members with retail, hospitality or food service establishments, it would require an interactive schedule-setting process by which employers must accommodate schedule demands of employees. Any changes to those schedules within 14 days of a shift would result in additional compensation.

As mentioned, amendments for SB 828 have been submitted. Even with the amendments, OSCC strongly opposes this bill. Click here to see our submitted testimony.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report - Week 8

 

 

Dear OSCC Members and Colleagues - 

To date, the 2017 legislative session has been one of the slowest moving sessions in recent history. Discussions on solving the state's budget deficit and funding a comprehensive transportation plan have seemingly utilized nearly all of the legislature's bandwidth. Very little else is moving. 

We have long felt that in light of the aggressive anti-business push in 2015 and 2016, this is a good outcome for OSCC members.

A couple of key things for OSCC members to know. First, probably 99% of all legislation has now been introduced. The playing field is set. There will be very few additional bills introduced from this point forward. Second, we are approaching our first major deadlines that will eliminate many bills from future consideration.

All bills must be scheduled for a vote in their original committee by April 7th, and all bills must pass their original committee by April 18th. Historically, this has been the most meaningful set of deadlines as most legislation will fall by the wayside.  But gamesmanship will also keep many bad bills alive until the very end. OSCC will keep you fully apprised.

Here's what we know from the past week:

OSCC continues to believe that there are not enough votes to pass any sort of tax increases - with the exception of a gas tax (for a transportation package) and a health care provider tax (to fund state Medicaid). We are very hard pressed to believe that Republicans will provide votes for any tax increases beyond these two taxes.

Where will the new revenue come from? The budget deficit is over $1.5 billion, and we see no compelling evidence that there will be either significant revenue or significant cost savings coming out of the 2017 session. At this stage, OSCC is recommending that members pay attention to SJR 41 or any other proposal that aims to establish a gross receipts tax. We believe that legislators don't think they can raise enough money without turning to a completely different source of revenue - most likely something based on gross receipts. We believe that the legislative leadership will give serious consideration to putting a gross receipts tax on the ballot, perhaps as soon as November of this year.

Business was given its opportunity to rebut a 'Cap and Trade' proposal. Prior to last week, the House and Senate Environment Committees had only given time to the DEQ and environmental activists seeking to implement a 'Cap and Trade' scheme to tax carbon emissions. But the business community unified and commissioned its own modeling and economic impact study of a 'Cap and Trade' proposal that looks significantly different than those of the proponents and the DEQ. Unlike the modeling performed by the state, the business community modeling - performed by FTI - performed actual economic modeling that shows reduced economic activity, higher costs and job losses - primarily in the manufacturing sector - as a result of 'Cap and Trade.' You can see the FTI report here.

Paid Family Leave proposal was heard in committee last week. House Bill 3087 implements a 0.5% income tax on employees and 0.5% payroll tax on employers to fund a 12-week paid family leave program on business of all sizes. Because the program is funded with a tax, the legislation requires a 3/5th supermajority of legislators to approve it. This gives business considerable leverage in defeating the proposal. OSCC anticipates that this legislation will be kept alive for the duration of the session, but at this point, the likelihood of passage is slim.

The House Business & Labor Committee finally passed a 'pay equity' bill that has garnered serious business opposition. HB 2005 would mandate 'pay equity' for all protected classes, would switch the burden of proof from plaintiff to employer, and would make each paycheck in which a disparity is claimed as a cause for remedy. Although business offered a generous compromise, it was rebuffed by House democratic leadership. It sets up a floor fight on this legislation in the House as early as this week.

Here's what's coming up this week:

Senate Bill 984 would overturn BOLI's recent interpretation that manufacturing employers are subject to both the state's 10-hour daily overtime rate and the federal 40-hour weekly overtime rate. BOLI's new interpretation means that daily and weekly overtime hours are double counted. SB 984 will get its first hearing in the Senate Workforce Committee this week. OSCC hopes that SB 984 gains traction, but it will be difficult. Just two weeks ago, the Multnomah County Circuit Court ruled in favor of employers on this matter.

Senate Bill 997 would penalize employers with 50 or more employees if any employees working 20 or more hours per week are not privately covered with employer-sponsored health insurance. We do not expect this bill to advance, but it will receive a hearing in the Senate Health Care committee.

Senate Bill 487 is scheduled for a work session this week. This bill increases non-economic damage awards in personal injury and wrongful death lawsuits. It will have major repercussions on health care providers as well as the commercial liability market. OSCC is unclear why the work session is scheduled as there does not appear to be sufficient votes to pass the bill.

The House Environment & Energy Committee will hear a slew of bills this week with major impacts on food producers. House Bill 2020 abolishes the Department of Energy and replaces it with Oregon Department of Energy and Climate. HB 2236 requires the Oregon DEQ to study and develop recommendations for updating the regulation of emissions of air contaminants from industrial sources.  Finally, HB 2269 levies additional Title V air permit fees on manufacturers, giving DEQ more money to create an emissions regulatory program that would devastate Oregon's manufacturers and rural communities. OSCC will oppose.

Of particular interest to OSCC members:

The public record is being held open on Senate Bill 828 - predictive scheduling - until April 4th. OSCC members are strongly urged to submit testimony in opposition to the legislation. Talking points for you and your members are included here. OSCC has submitted the included testimony.

SB 828 would be devastating for OSCC members by mandating compensation when employee shifts are changed or shortened through no fault of the employer.  For OSCC members with retail, hospitality or food service establishments, it would require an interactive schedule-setting process by which employers must accommodate schedule demands of employees. Any changes to those schedules within 14 days of a shift would result in additional compensation.

Your voice has an impact. Please take the time to send testimony from your Chamber and ask your members to do the same by April 4th.

Submit your comments on SB 828 to: This email address is being protected from spambots. You need JavaScript enabled to view it.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report - Week 7

 

Dear OSCC Members and Colleagues - 

The 2017 legislative session is very slowly gaining focus and momentum. The big, defining political discussions of 2017 around the budget (how to solve the state's $1.8 billion budget gap) and transportation (how to pass a comprehensive transportation funding package) are really just now starting to take shape.

But outside of those two major discussions, the legislature has yet to really pursue any other major themes - no aggressive push for any additional labor, environmental, energy, education or economic development goals are evident.

On balance, given our recent experiences with the legislature, this is a good development. It represents a sort of "Back to Basics" approach to state government.

Here's what we know from the past week:

Chief budget writer calls for $500 million in cuts and $500 million in added taxes. The legislature's chief budget writer, Senator Richard Devlin (D-Tualatin), was the first ranking legislator to publicly announce a framework to balance the budget. Over the weekend, he announced his support for a budget proposal that would cut $500 million in costs and add $500 million in new tax revenue.

This is a critical opening salvo for a couple of reasons. First, Devlin is a respected legislator who has more influence over the state budget than any other legislator.  Second, the framework is plausible even though it will cause discomfort to all sides of the debate. Democrats will argue that they can't find $500 million in budget reductions. Unions will argue that $500 million in new taxes is nowhere near enough. Republicans will argue that there is no need for additional tax revenue when state revenue is already growing over 8 percent per budget cycle.

Where will the new tax revenue come from? At this stage, OSCC is recommending that members pay attention to SJR 41 or any other proposal that aims to establish a gross receipts tax. We have reason to believe that legislators don't think they can raise enough money without turning to a completely different source of revenue - either a Commercial Activities Tax (CAT) or a straight Gross Receipts Tax (GRT) similar to the Washington B&O. OSCC believes this is the direction that legislative leadership is going. We believe that the legislature will attempt to put a gross receipts tax on the ballot, perhaps as soon as November of this year.

Senate's continued focus on PERS reform is surprising, but unlikely to yield much. The Senate Workforce Committee has devoted considerable time and effort in analyzing various PERS reform proposals...far more than would have been expected in a Democrat-controlled legislature. This past week, the committee took inventory of dozens of proposals from the general public on how to save money in the PERS system. But OSCC's analysis is still that significant PERS reform is unlikely and that the legislature may very well turn its attention to other cost drivers (state employee compensation and health benefits) in order to capture cost savings.

Corporate tax disclosure hearings yielded no new information. The House Revenue Committee heard HB 2019 and HB 2940, both designed to require C corporations to publicly disclose more of their tax information. OSCC opposes this legislation for several reasons. Going into the legislative session, the government employee unions claimed this legislation was among their top priorities, but the hearings on the bill did not yield any new participants or any new information from previous attempts to pass this type of legislation. OSCC anticipates that we may have a real fight on this issue in the House, but it is unlikely the Senate would consider it.

Here's what's coming up this week:

The business community response to 'Cap and Trade' will be heard this week in a joint meeting of the House and Senate Environment committees. To date, the committees have only given time to the environmental activists seeking to place emissions mandates and costs on employers. But the business community commissioned its own modeling and economic impact study of a 'Cap and Trade' proposal that looks significantly different than those of the proponents and the DEQ.

The business modeling, conducted by FTI, shows reduced economic activity, higher costs and job losses - primarily in the manufacturing sector - as a result of 'Cap and Trade.' You can view the FTI report here.

The House Business & Labor Committee will try - AGAIN - to pass its first bill with serious business opposition. HB 2005 would mandate 'pay equity' for all protected classes, would switch the burden of proof from plaintiff to employer, and would make each paycheck in which a disparity is claimed as a cause for remedy.

Business groups stalled the bill last week with a major effort to support a compromise 'pay equity' bill that encompasses pay discrimination based on gender, race and ethnicity (so long as burden of proof remains with the plaintiff) and curtailing the bill's many rights of action against employers. See our correspondence here.

Several key House Democrats have been supportive of the business position and want a compromise bill now instead of being forced to vote on a bill that business does not support.

However, it appears that Democratic leadership in the House intends to continue its time-honored tradition of steamrolling over the business community this week and passing the original bill.

Community 'Right to Know' legislation to be heard in the House Environment & Energy Committee.  HB 2669 is being closely watched and strongly opposed by manufacturers and the business community at large. It proposes to amend a long standing agreement struck in 1999. That agreement - existing law - authorizes local governments to establish community 'right to know' regulatory programs of the kind found in the City of Eugene.

Businesses already publicly report hundreds of chemicals that are stored and released from facilities through state air and water permits, State Fire Marshal reports, federal toxics release inventories, and others. In addition, businesses are constantly improving processes to reduce chemical use and to reduce input and regulatory costs (as required under Oregon's landmark Toxics Use and Hazardous Waste Reduction Act).

HB 2669 is an overreach because:

  • It removes the requirement that local governments demonstrate the need for the program;
  • It removes protections for sensitive business information, including trade secrets;
  • It removes the requirement that DEQ, OHA, and the State Fire Marshall have an opportunity to provide comment;
  • It requires reporting of chemicals down to the .02 pounds, and
  • It increases maximum annual fees five-fold from $2,000 to $10,000.


First Hearings on Paid Family Leave. The House will commence hearings on a new paid family leave bill - House Bill 3087 - which grants up to 12 weeks of paid leave for employees who take time off under the Oregon Family Leave Act. The program is funded by a new 0.5% tax on employees and 0.5% payroll tax on employers.

The bill extends full benefits to anyone employed for 90 days, and in one of the more curious aspects of the bill, only extends benefits if funds are available. HB 3087 allows for paid family leave to be taken in as little as 8-hour increments.

The fact that HB 3087 requires a tax means that the bill must pass with a 3/5 supermajority vote, which is unlikely. We also anticipate that proponents will try and find a way to raise the necessary funding in the bill so that the 3/5 supermajority vote requirement does not apply. OSCC will oppose the legislation.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

 

2017 Legislative Report - Week 6

 

Dear OSCC Members and Colleagues - 

We'll start with some great news this week ... In a highly anticipated court decision, the Multnomah County Circuit Court ruled against the new BOLI interpretation of Oregon's daily overtime statute for manufacturers in the Portland Specialty Baking case.

As you'll recall, BOLI's new interpretation of Oregon's daily overtime statute was that manufacturing employers were liable for both daily and weekly overtime payments, which allowed for double-counting of some overtime hours. For example, in instances in which an employee might work four 12-hour shifts in a week, an employer would be liable for 16 total hours of overtime (8 hours of daily overtime plus 8 hours of weekly overtime).

Multnomah County Circuit Court Judge Kathleen Dailey ruled that employers do not have to pay for both daily and weekly overtime. She reasoned that adherence to the daily overtime law (for all daily hours worked in excess of 10 hours per day) would ensure compliance with the federal weekly overtime law and that there was no provision in law that called for double-counting of overtime hours. The decision provides a firm footing for employers to continue to follow BOLI's prior guidance on this critical issue.

Here's what we know from the past week:

There was little movement on significant 'anti-business' legislation.  Environmental legislation to regulate air emissions, diesel engines, or tax carbon appears to be relegated to after-hours workgroups. There also appears to be little momentum for labor initiatives such as paid family leave. This is consistent with previous OSCC observations that the legislature would be focusing primarily on budget and transportation - leaving major labor and environment legislation on the sidelines for now.


Minimum wage 'fix' bills introduced by Rep. Clem (D-Salem) to help agriculture and food processors. Clem's legislation - HB 3317 - redraws the minimum wage map so that the higher minimum wage rates apply to certain MSA's and not counties at large. His other bill - HB 3383 - gives agriculture and food processors a tax credit for the higher minimum wages. Clem found over 30 co-sponsors for both bills, including many democrats who voted for the higher minimum wages in 2016, and believes that Speaker Kotek will agree to some version of his proposals. But it will be a very tough slog to get some sort of minimum wage relief passed.


Look for taxes that can be passed with simple majority votes. OSCC has cautioned its members that the legislature would look to 'kick the tires' on a new Legislative Counsel legal opinion that gives the legislature authority to raise some taxes without invoking the constitutional 3/5th supermajority voting requirement to raise in the legislature. The Legislative Counsel gave legislators the green light to take away tax deductions and tax credits with simple majority votes. Given the Democratic dominance in the legislature, this provides a tempting path of least resistance to raise revenue.

The House Revenue Committee is signaling its interest in raising revenue using this method and is eyeing such things as removing or limiting itemized deductions, property tax deductions (HB 2771) and mortgage interest deductions (HB 2006). This will be an issue to keep a very close eye on over the next several months.

Here's what's coming up this week:

The House Revenue Committee will continue its focus on corporate tax disclosure. HB 2019 and HB 2940 would add new tax disclosure requirements for Oregon companies. Both proposals would involve public filings of tax information.  This is a significant priority for Oregon's government employee unions who have made this a centerpiece of their 2017 legislative agenda. We expect a friendly audience for this legislation in the House, but a much less receptive audience in the Senate. Business groups, including OSCC, will wage opposition here.


The House Business & Labor Committee will try and pass its first bill with serious business opposition. HB 2005 would mandate 'pay equity' for all protected classes, would switch the burden of proof from plaintiff to employer, and would make each paycheck in which a disparity is claimed as a cause for remedy. Employer groups have signaled a willingness to agree to a 'pay equity' bill that encompasses pay discrimination based on gender (so long as burden of proof remains with the plaintiff) and banning the practice of requiring job applicants to disclose previous salary history. Several key Democrats are supportive of the business position and want a compromise bill now instead of being forced to vote on a bill that business does not support. OSCC will keep members apprised.


Major PERS hearings resume in the Senate. The Senate Workforce Committee will continue to take testimony on SB 560 and SB 913, which to date are the major PERS Reform bills of the 2017 session. Among other things, the bills raise the retirement age, lower the assumed earnings rate, re-direct the 6% employee contribution into the pension plan, and spread out 'final average salary' over five years instead of three years. The concepts in both bills are heavily supported by school boards, local government and the business community. The bills are strongly opposed by the unions. 

Of particular interest to OSCC members:

Chambers need to make their voice heard on SB 828 or HB 2193 - predictive scheduling. As we mentioned last week, OSCC has reason to believe that this is now the top labor priority for 2017.

After reviewing the legislative record, only two Chambers (North Clackamas, Albany and a member from Tigard Chamber) have submitted testimony in opposition to the bill. OSCC needs regional Chamber support by way of submitting testimony from your Chamber and your members.

What you need to know on SB 828 and HB 2193: (1) It requires a minimum of four hours of pay for any food processor that calls an employee into work but the employee does not work the shift in its entirety, or (2) when an employee is told with less than 24 hours' notice that their upcoming shift is not needed or that the hours in the shift have been reduced.

SB 828 and HB 2193 will hurt local restaurants, hospitality establishments and retailers. It requires an interactive scheduling process in which an employer must accommodate employee scheduling requests. It also requires that schedules be set 14 days in advance. For any changes made to an employee's schedule with fewer than 14 days' notice, it requires one hour of additional pay per any change that does not result in a loss of hours worked, and it requires one-half rate of pay for any scheduling change that results in a loss of hours.

Here are some resources to assist you in drafting your testimony.  OSCC submitted testimony at the end of February (click here to view). Go to the included links to view business testimony on SB 828 or  HB 2193View the legislation here.

Action is needed now. Please submit your Chamber's testimony this week. Additionally, send an action alert to your members to submit a letter in opposition. It is important for your member businesses to tell their customized story. OSCC has created business talking points to assist.

OSCC members should submit testimony on SB 828 to: This email address is being protected from spambots. You need JavaScript enabled to view it. and on HB 2193 to: This email address is being protected from spambots. You need JavaScript enabled to view it.

OSCC member testimony is absolutely critical in opposing these bills. Take action now and make your voice heard. 

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report - Week 5

 

 

Dear OSCC Members and Colleagues - 

The 2017 Oregon legislature forged into familiar territory last week with orchestrated hearings on legislation that is opposed and hotly contested by the business community - predictive scheduling (SB 828), removal of non-economic damage limits in lawsuits (SB 487), and a slew of bills regulating carbon emissions.

But unlike previous sessions, none of this legislation is a fait accompli. The future of all of these issues is tenuous at best.

OSCC's observations about the framework for the 2017 session is holding steady: (1) Leadership appears to be growing more serious about reducing the cost of state government, particularly in the area of labor costs, (2) there is continuing momentum for a comprehensive transportation funding package, (3) additional revenue generation is now a point of discussion between key bipartisan house and senate negotiators, and (4) there is a growing acknowledgement that PERS is not sustainable under the weight of $22 billion in unfunded liabilities.

Here's what we know from the past week:

The commitment to a bipartisan effort on the budget and transportation funding continues to forestall major anti-business legislation. Republicans have made it clear that their engagement in key budget and transportation efforts is contingent on not getting defeated on issues of primary concern to them - primarily business issues. Senate President Peter Courtney has also emphasized his desire for bipartisanship and the avoidance of partisan fights. This is perhaps the defining theme of 2017. The first casualty of this drive for bipartisanship appears to be environmental legislation - carbon pricing and emissions regulations. Once thought a foregone conclusion for 2017, these issues are clinging to life.

OSCC members did, indeed, catch a break on paid family leave legislation. We anticipated that legislators would find a way to raise the necessary revenue from business and employees to pay for a new paid family leave program without invoking the necessary 3/5th 'supermajority' voting requirement for raising taxes. Thankfully, we were wrong. Legislative Counsel has determined that the revenue needed to fund paid family leave constitutes a tax, and therefore, needs a 3/5th majority of the legislature to approve the legislation. This gives OSCC much greater leverage in defending against this expensive business mandate.

Predictive scheduling will likely be the primary 2017 labor issue now, but if it survives, it will be greatly watered down. The bill to pay attention to is SB 828. This bill specifically targets restaurants, hospitality establishments and retail stores. But Section 3 of the bill applies to all employers and would set onerous new wage requirements for any shift changes that result from lack of business demand or lack of customers on any given day. OSCC expects that Section 3 will be deleted in an effort to gain support as the bill is currently faltering. OSCC testified in opposition.

The House Revenue Committee began hearings on increased business taxes. The House committee heard bills that increase the corporate income tax to 8% (HB 2830) and increase the corporate minimum tax for large S corps (HB 2831). Although we don't believe there is an intention to move these bills independently of a pre-negotiated revenue package, OSCC will oppose these bills.

OSCC continues to urge members to pay attention to the discussion around SJR 41, which would switch Oregon to a gross receipts tax model.

Here's what's coming up this week:

New environmental regulations and taxes will be heard by a special joint House and Senate committee and will now involve informal evening hearings starting this week. This is a classic good news/bad news scenario.

The good news is that this new evening process essentially signals a 'white flag' of surrender on these anti-business measures for 2017. The bad news is that it represents an ongoing process to tee up these proposals once proponents sense the coast is clear. OSCC will closely monitor.

As of today, OSCC believes that while there is plenty of appetite (and votes) to move some sort of 'cap and trade' or carbon pricing proposal in the House, there is not enough support in the Senate. But again, as with most of the major non-budget and non-transportation issues that are looming, that could change if bipartisan negotiations on the budget or transportation break down. OSCC will oppose.

The "other" predictive scheduling bill - HB 2193 - will be heard in House Business & Labor Committee on Monday. Unlike the Senate hearing on SB 828, this bill will share the stage with several other bills, meaning it won't get the full attention of the committee ... an additional signal that SB 828 is the bill to pay attention to. But OSCC will continue to monitor HB 2193 in the event that it becomes the bill that proponents want to focus on.

The House Revenue Committee will continue its hearings on legislation that would impact business taxes. HB 2771 would discontinue the allowance of being able to deduct property taxes paid.

The Senate Environment & Natural Resources Committee will vote to approve SB 805, which appropriates $9.4 million for the agricultural experiment station and branch stations, Oregon State University Extension Service and Forest Research Laboratory programs of Oregon State University. This is very welcome news for our more rural members, but the legislation faces a tough road in a resource-constrained environment. OSCC will support.

Of particular interest to OSCC members:

We are continuing to sound the alarm on SB 828 - predictive scheduling. As we mentioned last week, OSCC has reason to believe that this is now the top labor priority for 2017.

What you need to know on SB 828: (1) It requires a minimum of four hours of pay for any food processor that calls an employee into work but the employee does not work the shift in its entirety, or (2) when an employee is told with less than 24 hours' notice that their upcoming shift is not needed or that the hours in the shift have been reduced.

SB 828 has much more stringent provisions for restaurants, hospitality establishments and retailers. It requires an interactive scheduling process in which an employer must accommodate employee scheduling requests. It also requires that schedules be set 14 days in advance. For any changes made to an employee's schedule with fewer than 14 days' notice, it requires one hour of additional pay per any change that does not result in a loss of hours worked, and it requires one-half rate of pay for any scheduling change that results in a loss of hours.

You can see SB 828 here.

OSCC members can submit testimony on SB 828 to: This email address is being protected from spambots. You need JavaScript enabled to view it.

OSCC member testimony is encouraged NOW. Please make the request to your members to send customized testimony. Click here for talking points.

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report (Week 4)

 

 

Dear OSCC Members and Colleagues - 

The 2017 Oregon legislature is picking up steam and starting to delve into issues of general concern to the business community. On the positive side, legislators received welcome news as economic forecasters delivered a positive revenue forecast that may lessen the need for additional revenues. But on the negative side, committees have started to schedule hearings on issues that will generally have a negative impact on business if passed. OSCC will keep members apprised as these issues and hearings start to populate committee schedules.

OSCC is starting to see an overall framework develop for the 2017 legislative session: (1) Leadership appears to be growing more serious about reducing the cost of government, particularly around personnel costs, (2) there appears to be growing momentum for a comprehensive transportation funding package, (3) additional revenue generation remains a key issue, but more so for Democrats than Republicans, and (4) there does seem to be a growing acknowledgement that PERS may not survive under the weight of the current $22 billion in unfunded liabilities.

Here's what we know from the past week:

Although there is not yet any sort of "master plan" to deal with the state's budget deficit, legislators are starting to form bipartisan negotiating teams and workgroups.  OSCC regards this as a positive development.  It means that legislators are starting the process of negotiating with each other.  It also fills the leadership vacuum that had outside groups wondering if they should be negotiating in lieu of legislative discussions.  Bipartisan, bi-cameral negotiating teams are being assembled for both general revenue discussions and hospital provider tax discussions, both major components to solving the overall budget puzzle.

Although it is still early, the Senate commitment to bipartisanship could pay significant dividends to business in 2017, particularly in the area of costly environmental and labor regulation. This is a major theme we will be paying attention to all session, for it has the potential to forestall several anti-business policies that are looming on the horizon. As long as good faith bipartisan negotiations continue on the budget and transportation, there is a good chance that there may be no appetite for anti-business legislation.

The business community, including OSCC, looks poised to block legislation that would require employers not to discriminate in terms and conditions of employment based on off-duty marijuana use.  The bill in question - SB 301 - requires that employers do not discriminate against employees or prospective employees based on their marijuana use.  However, the legislation runs directly into a brick wall - the Oregon Supreme Court - which has established a strong legal precedent that employers are entitled to enforce zero-tolerance workplace drug polices and may not be compelled to accommodate what the federal government has made illegal.  Although SB 301 received a public hearing in the Senate Judiciary Committee last week, it appears at this point that a majority of Oregon senators will not vote for the bill. OSCC testified in opposition to SB 301 and will keep members apprised.

OSCC members may have caught a break on paid family leave legislation. Over the past few weeks, OSCC had developed the opinion that paid family leave would become organized labor's top legislative priority for 2017. We anticipated that Legislative Counsel (the legislature's lawyers) would determine that employers and employees could be assessed 'fees' under the bill to pay for the program that would only require a simple majority of legislators to approve. However, it appears that Legislative Counsel has determined that paying for the program would require a 'tax' on workers and employers that would require a 3/5 'supermajority' of legislators to approve. This gives OSCC far more leverage in defending against this proposal, which would ultimately require additional employer payroll taxes.

The state's economist, in the official February Revenue Forecast, has estimated that legislators will see an additional $200 million in revenues for the upcoming 2017-19 budget cycle. The net effect of this forecast is that the projected state deficit for the 2017-19 shrunk from $1.8 billion to $1.6 billion.  Predictably, both parties welcomed the news because it made their budget balancing task slightly less daunting.

Here's what's coming up this week:

Predictive scheduling will get a full blown public hearing on Monday.  The Senate Workforce Committee will hear SB 828.  This bill, while targeting all employers, specifically targets restaurants, hospitality establishments and retail stores.  The bill would set onerous new wage requirements for any shift changes that result from lack of business demand or lack of customers on any given day. OSCC will oppose.  

Increased damage award limits will get a hearing on Tuesday.  The trial lawyers have been trying for several sessions to increase non-economic damage limits on wrongful death and personal injury claims which would result in increased liability costs for business and health care providers.  SB 487 will be heard in the Senate Judiciary Committee on Tuesday. SB 487 is on the OSCC agenda as a bill that business will oppose.

New environmental regulations and taxes will be heard by a special joint House and Senate committee hearing on Wednesday. A special joint hearing of the House and Senate Environment Committees will convene on Wednesday to take testimony on 'cap and trade,' increased air emission regulations and new carbon taxes. 

At this point, no evening hearings have been scheduled.  We expect pressure to ramp up as legislators and committee members need to move or pass a bill out of the first chamber by mid-April. It is fully anticipated that environmental advocates will push to move one of the concepts to the Joint Ways and Means Committee or the Rules Committee so they have an opportunity to pass legislation around carbon pricing or restricting air emissions should bipartisan conversations around transportation or the budget disintegrate.

As of today, OSCC believes that while there is plenty of appetite (and votes) to move these types of proposals in the House, there is not enough support in the Senate. But again, that could change if bipartisan negotiations on the budget or transportation break down. OSCC will oppose.

The House Revenue Committee will begin hearings on increased business taxes on Thursday.  The House committee will hear bills that increase the corporate income tax to 8% (HB 2830) and increase the corporate minimum tax for large S corps (HB 2831).  Although we don't believe there is an intention to move these bills independently of a pre-negotiated revenue package, OSCC will oppose these bills.

Of particular interest to OSCC members:

We are sounding the alarm on SB 828 - predictive scheduling.  OSCC has reason to believe that this is now the top labor priority for 2017.

What you need to know on SB 828:  (1) It requires a minimum of four hours of pay for any employer that calls an employee into work but the employee does not work the shift in its entirety, or (2) when an employee is told with less than 24 hours' notice that their upcoming shift is not needed or that the hours in the shift have been reduced.

SB 828 has much more stringent provisions for restaurants, hospitality establishments and retailers. It requires an interactive scheduling process in which an employer must accommodate employee scheduling requests. It also requires that schedules be set 14 days in advance. For any changes made to an employee's schedule with fewer than 14 days' notice, it requires one hour of additional pay per any change that does not result in a loss of hours worked, and it requires one-half rate of pay for any scheduling change that results in a loss of hours.

You can see SB 828 here.

As you may have seen, earlier today OSCC sent a Mobilization Alert calling for testimony against SB 828. Please submit written testimony from your Chamber and your members to: This email address is being protected from spambots. You need JavaScript enabled to view it.. For talking points, please go to this link. Remember to provide the testimony from the perspective of how this will impact your community or your member businesses. OSCC has submitted the included testimony.

OSCC member testimony is encouraged at any time this week.  

Best regards,

Alison Hart
Executive Director
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-231-5421 

JL Wilson
Legislative Counsel
This email address is being protected from spambots. You need JavaScript enabled to view it.
503-363-2182

 

2017 Legislative Report (Week 3)

 

 

Dear Members and Colleagues - 

The 2017 Oregon legislature continues to plod along at a cautious pace. Again, only a few hundred additional bills were introduced in the past week, a far lesser amount than anticipated. Only a few committees are delving into controversial issues, but many of those are simply informational hearings. Only the House Business Committee has taken up controversial anti-business legislation to date, while both the House and Senate Revenue Committee are exploring tax issues that have significant impact on the business community.

Here's what we know from the past week:

Again, there is not yet any sort of "master plan" to deal with the state's $1.8 billion budget deficit.  All the different sides in the debate are still collecting information and exploring options.This process will unfold slowly through negotiation and will likely take several months. Although Democrats hold substantial majorities in both the House and the Senate, they don't have the votes to pass either the necessary cuts, spending reforms, or potential taxes without Republican support. It will truly require bipartisan deal-making. Three weeks into session, lawmakers are simply gathering information and learning how to work with each other.

Senate commitment to bipartisanship could pay significant dividends to business, particularly in the area of costly environmental regulation. This is potentially the most significant theme of 2017, and we'll be paying close attention to it all session. Senate President Peter Courtney (D-Salem) has committed the Senate to bipartisanship in 2017 that has the potential to derail many partisan issues that could potentially harm business. Of particular note, it appears that extreme environmental regulatory policies may be the first casualty of the commitment to bipartisanship.  Issues such as 'cap & trade', diesel engine regulations, and emissions regulations appear to have very little traction so far. This is a far different environment than we witnessed in 2015 and 2016.

The House Business Committee continues to be the committee most likely to consider and pass anti-business bills. This past week, the committee took testimony on HB 2167 (which creates an unlawful employment action for 'hostile' work environments), HB 2169 (which gives only employees the ability to collect attorney fees in wage and hour employment cases), HB 2180 (which allows employees to file liens against employer property for wage claims) and HB 2181 (which presumes employers guilty until proven innocent for adverse employment actions against employees with pending wage claims). OSCC opposed all four bills. Of note, the inclusion of Representative Janelle Bynum (D-Happy Valley), a McDonalds restaurant owner, on this committee has made the committee more moderate and less inclined to pass radical legislation such as the aforementioned bills. 

The 'Small Business Tax Cut' is clearly being targeted for repeal or significant change. The Senate Finance and Revenue Committee took testimony this past week on SB 165, which requires small businesses to show an increase in employment before being able to take advantage of Oregon's lower tax rates for 'pass-through' small businesses. OSCC opposes this legislation and strongly opposes repeal of the lower tax rates for small business. OSCC believes that the 'small business tax cut' should be expanded to include more small businesses, including sole proprietors, who are currently precluded from taking advantage of the lower rate schedule. The Senate committee heard clearly from CPA's and others that SB 165 was not a good idea because it added complexity and uncertainty for small businesses in the tax code.

Silly Tax Proposals.  The past week was particularly interested for the number of silly tax bills that were introduced that would impact local businesses, including:

  • HB 2875 - creates a new 5 cent per pound tax on coffee beans
  • HB 2877 - creates a new $1,000 tax on vehicles over 20 years old
  • HB 2941 - disallows expensing of depreciable business assets on Oregon tax return

Here's what's coming up this week:

Marijuana accommodation in the workplace. This is perhaps the biggest potential event for the business community this coming week. The Senate Judiciary Committee is planning a hearing and a vote on SB 301, which prevents an employer from discriminating against prospective employees due to marijuana use. This bill is in direct conflict the Oregon Supreme Court's decision in the Emerald Steel case, which held that Oregon employers are entitled to enact 'zero tolerance policies' on marijuana use. OSCC will strongly oppose this bill. We are further puzzled why the bill is scheduled for a committee vote when there are clearly not enough votes to pass the bill in the Senate. We do not anticipate that this bill can pass the legislature.

Environmental Regulation Hearings.  The Senate Environment & Natural Resources committee will continue to take testimony this week on regulatory issues - this time on 'cap & trade' and a 'clean air tax'. OSCC is closely monitoring these issues, but again, we do not anticipate that the legislature, particularly the Senate, intends to take up these issues in 2017.

Property Tax Reform Hearings Continue.  The Senate Finance & Revenue Committee will continue hearings on property tax reform which would likely have the effect of accelerating values and property taxes for industrial properties. The legislation being considered is SJR 3. This bill repeals Measure 50 and requires that property taxes be assessed on real market value instead of assessed value (which can only increase 3% per year). SJR 3 is being considered alongside a companion bill, SB 151, which creates a sizable homestead exemption to lower property taxes for homeowners. The effect of the two bills is to effectively lower property taxes for homeowners and increase property taxes for commercial and industrial properties.  Please note that both bills face a very uphill climb with steep hurdles, not the least of which is that Oregon voters must approve the change.

'Equal Pay' Legislation Considered. The House Business and Labor Committee will take a look at HB 2005 this week. The legislation is another attempt to establish additional 'equal pay' provisions in statute.  The bill makes it illegal to discriminate in pay for similar jobs. The bill also makes it illegal for an employer to consider pay history of a prospective employee. It is not yet clear how additional 'equal pay' laws will enhance the pay discrimination laws already on the books. OSCC will monitor this legislation closely, particularly for additional avenues to sue employers.

We received several emails this week from Chambers with questions on status of particular legislation or specific details. Keep them coming. We are here to support you. Send any questions or issues that are arising.

Best regards,

Alison Hart

Executive Director

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-231-5421 

JL Wilson

Legislative Counsel

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-363-2182

 

 

2017 Legislative Report (Week 2)

Dear Members and Colleagues - 

The 2017 legislative session has concluded its second week at a very cautious pace.  Only 200 or so additional bills were introduced in the past week, a far lesser amount than anticipated.  Committees are not yet diving into controversial issues.  But this week there are a handful of legislative committees that will be sticking their toes in the water on legislation that business will oppose.

Here's what we know from the past week:

There is not yet any sort of "master plan" to deal with the state's $1.8 billion budget deficit.  This will unfold slowly through negotiation and will likely take several months. Although Democrats hold substantial majorities in both the House and the Senate, they don't have the votes to pass either the necessary cuts, spending reforms, or potential taxes without Republican support. It will truly require bipartisan deal-making.  At this stage, lawmakers are simply gathering information and learning how to work with each other.

Business is figuring out its role and trying to find its 'voice' in the budget debate.  The organized business community has been clear about how it would advise lawmakers to balance the state's budget and set the state on a path to fiscal sustainability. First, grow the economy (including stopping additional regulatory burdens). Second, slow down the escalating costs in state government (including health care and PERS). Finally, add new revenue when the first two objectives have been dealt with in a meaningful way.  Business groups are feeling their way along on how to strongly advocate its positions without undercutting legislative negotiations.

The public disclosure of "confidential" meetings between Senate President Peter Courtney, House Speaker Tina Kotek, and union and business leaders, was met with severe backlash from Republicans and many business groups. 

Senate commitment to bipartisanship.  This is potentially the most significant theme of 2017, and we'll be paying close attention to it all session. Senate President Peter Courtney (D-Salem) has committed the Senate to bipartisanship in 2017 that has the potential to derail many partisan issues that could potentially harm business. At this stage, Courtney has pledged that in order to build trust and cooperation around the herculean tasks of solving the state budget gap and passing a transportation funding package, the Senate will not advance any legislation that does not have support from members of both parties. This has the potential to forestall many pending labor, environmental and tax issues that business groups had feared could come to fruition in 2017. Stay tuned here...this commitment by Senate President Courtney could potentially stave off many 2017 threats to our local business communities.

Here's what's coming up this week:

PERS Hearings. The Senate Workforce committee will hold public hearings on the two most significant PERS reform bills introduced to date. Senate Bill 559 calculates final average salary of PERS beneficiaries over five years instead of three. Senate Bill 560 redirects future employee contributions out of the individual account program into the pension. This bill has the single biggest impact on reducing the PERS unfunded liabilities, but it's also totally unacceptable to the unions. The reason this hearing is significant is because both bills are considered Republican bills, and yet the committee is willing to give both bills a serious hearing.  This indicates a seriousness about addressing PERS costs that seemed lacking from the Governor and legislative leadership in the months leading up to the legislative session.

Environmental Regulation Hearings.  The Senate Environment & Natural Resources committee will take testimony this week on potential efforts to curb on-road and off-road diesel emissions. OSCC is closely monitoring this topic.  Also, the committee will hear testimony on the "Cleaner Air Oregon" regulatory initiative that OSCC is also closely monitoring. OSCC fears that "Cleaner Air Oregon" regulations have the potential to shut down local manufacturing in Oregon due to regulations that cannot be met. 

Property Tax Reform Hearings. The Senate Finance & Revenue Committee will conduct hearings on property tax reform which would likely have the effect of accelerating values and property taxes for industrial properties. The reforms being floated by Chair Mark Hass (D-Beaverton) contemplate repealing Measure 50 and requiring property taxes to be assessed on real market value instead of assessed value (which can only increase 3% per year). Hass proposes this switch, in conjunction with a sizable homestead exemption, to effectively lower property taxes for homeowners and increase property taxes for commercial and industrial properties. The legislation being considered here is SJR 3.

Small Business Tax Cut Repeal.  Another issue being considered this week in the Senate Finance & Revenue Committee is the effective repeal of the "small business tax cut" passed by the 2013 legislature. The tax cut was designed to give pass-through businesses (S corps, LLCs, partnerships) a lower tax rate starting at 7% instead of the 9% that was previously levied on these businesses. Senate Bill 165 would only allow small businesses to utilize this lower tax rate if they show employment and wage gains year over year. OSCC will oppose this legislation.  It appears to be a backdoor repeal of the small business tax bracket.

Business Tax Reform.  The House Revenue Committee will hold hearings all week on 'business tax reform,' whatever that means. Presumably, it means how to increase taxes on Oregon business, but we will know more after this week's hearings.

House Business & Labor Committee Will Take Up Labor Issues.  The historically anti-business House Business & Labor Committee will take up controversial legislation this week when it holds hearings on House Bill 2167, which would make an "abusive work environment" an unlawful employment practice, and House Bill 2180, which would allow for liens against employer real and personal property by claimants alleging unpaid wages. These bills would be detrimental to local businesses.

Of particular interest to OSCC members:

-  HB 2875 would add a new five cent per pound tax on ground coffee beans to be levied at the wholesale level.  This is first time OSCC has ever seen this tax proposal.

-  HB 2876 would add a new 13 percent tax rate for income above $250,000.  This is a significant issue for small business as business income is typically taxed at the personal income tax rates.

-  HB 2877 would enact a new $1,000 tax on vehicles over 20 years old.  Again, this is the very first time that OSCC has ever seen this specific tax proposal.

Reach out with any questions or issues on which you would like more information.

Best regards,

Alison Hart

Executive Director

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-231-5421 

JL Wilson

Legislative Counsel

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-363-2182

2017 Legislative Report (Week 3)

 

Dear Members and Colleagues - 

The 2017 Oregon legislature continues to plod along at a cautious pace. Again, only a few hundred additional bills were introduced in the past week, a far lesser amount than anticipated. Only a few committees are delving into controversial issues, but many of those are simply informational hearings. Only the House Business Committee has taken up controversial anti-business legislation to date, while both the House and Senate Revenue Committee are exploring tax issues that have significant impact on the business community.

Here's what we know from the past week:

Again, there is not yet any sort of "master plan" to deal with the state's $1.8 billion budget deficit.  All the different sides in the debate are still collecting information and exploring options.This process will unfold slowly through negotiation and will likely take several months. Although Democrats hold substantial majorities in both the House and the Senate, they don't have the votes to pass either the necessary cuts, spending reforms, or potential taxes without Republican support. It will truly require bipartisan deal-making. Three weeks into session, lawmakers are simply gathering information and learning how to work with each other.

Senate commitment to bipartisanship could pay significant dividends to business, particularly in the area of costly environmental regulation. This is potentially the most significant theme of 2017, and we'll be paying close attention to it all session. Senate President Peter Courtney (D-Salem) has committed the Senate to bipartisanship in 2017 that has the potential to derail many partisan issues that could potentially harm business. Of particular note, it appears that extreme environmental regulatory policies may be the first casualty of the commitment to bipartisanship.  Issues such as 'cap & trade', diesel engine regulations, and emissions regulations appear to have very little traction so far. This is a far different environment than we witnessed in 2015 and 2016.

The House Business Committee continues to be the committee most likely to consider and pass anti-business bills. This past week, the committee took testimony on HB 2167 (which creates an unlawful employment action for 'hostile' work environments), HB 2169 (which gives only employees the ability to collect attorney fees in wage and hour employment cases), HB 2180 (which allows employees to file liens against employer property for wage claims) and HB 2181 (which presumes employers guilty until proven innocent for adverse employment actions against employees with pending wage claims). OSCC opposed all four bills. Of note, the inclusion of Representative Janelle Bynum (D-Happy Valley), a McDonalds restaurant owner, on this committee has made the committee more moderate and less inclined to pass radical legislation such as the aforementioned bills. 

The 'Small Business Tax Cut' is clearly being targeted for repeal or significant change. The Senate Finance and Revenue Committee took testimony this past week on SB 165, which requires small businesses to show an increase in employment before being able to take advantage of Oregon's lower tax rates for 'pass-through' small businesses. OSCC opposes this legislation and strongly opposes repeal of the lower tax rates for small business. OSCC believes that the 'small business tax cut' should be expanded to include more small businesses, including sole proprietors, who are currently precluded from taking advantage of the lower rate schedule. The Senate committee heard clearly from CPA's and others that SB 165 was not a good idea because it added complexity and uncertainty for small businesses in the tax code.

Silly Tax Proposals.  The past week was particularly interested for the number of silly tax bills that were introduced that would impact local businesses, including:

  • HB 2875 - creates a new 5 cent per pound tax on coffee beans
  • HB 2877 - creates a new $1,000 tax on vehicles over 20 years old
  • HB 2941 - disallows expensing of depreciable business assets on Oregon tax return

Here's what's coming up this week:

Marijuana accommodation in the workplace. This is perhaps the biggest potential event for the business community this coming week. The Senate Judiciary Committee is planning a hearing and a vote on SB 301, which prevents an employer from discriminating against prospective employees due to marijuana use. This bill is in direct conflict the Oregon Supreme Court's decision in the Emerald Steel case, which held that Oregon employers are entitled to enact 'zero tolerance policies' on marijuana use. OSCC will strongly oppose this bill. We are further puzzled why the bill is scheduled for a committee vote when there are clearly not enough votes to pass the bill in the Senate. We do not anticipate that this bill can pass the legislature.

Environmental Regulation Hearings.  The Senate Environment & Natural Resources committee will continue to take testimony this week on regulatory issues - this time on 'cap & trade' and a 'clean air tax'. OSCC is closely monitoring these issues, but again, we do not anticipate that the legislature, particularly the Senate, intends to take up these issues in 2017.

Property Tax Reform Hearings Continue.  The Senate Finance & Revenue Committee will continue hearings on property tax reform which would likely have the effect of accelerating values and property taxes for industrial properties. The legislation being considered is SJR 3. This bill repeals Measure 50 and requires that property taxes be assessed on real market value instead of assessed value (which can only increase 3% per year). SJR 3 is being considered alongside a companion bill, SB 151, which creates a sizable homestead exemption to lower property taxes for homeowners. The effect of the two bills is to effectively lower property taxes for homeowners and increase property taxes for commercial and industrial properties.  Please note that both bills face a very uphill climb with steep hurdles, not the least of which is that Oregon voters must approve the change.

'Equal Pay' Legislation Considered. The House Business and Labor Committee will take a look at HB 2005 this week. The legislation is another attempt to establish additional 'equal pay' provisions in statute.  The bill makes it illegal to discriminate in pay for similar jobs. The bill also makes it illegal for an employer to consider pay history of a prospective employee. It is not yet clear how additional 'equal pay' laws will enhance the pay discrimination laws already on the books. OSCC will monitor this legislation closely, particularly for additional avenues to sue employers.

We received several emails this week from Chambers with questions on status of particular legislation or specific details. Keep them coming. We are here to support you. Send any questions or issues that are arising.

Best regards,

Alison Hart

Executive Director

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-231-5421 

JL Wilson

Legislative Counsel

This email address is being protected from spambots. You need JavaScript enabled to view it.

503-363-2182

 

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