Governor’s Budget: Gov. Tina Kotek released her first proposed budget Jan. 31. It prioritizes housing, mental health and addiction services, and education. Many media outlets have written about the proposal, including Oregon Public Broadcasting and The Oregonian.
Housing Supply: The Oregonian examines the obstacles to meeting Gov. Kotek’s housing goal, which calls for the construction of 36,000 homes every year. Oregon Public Broadcasting, meanwhile, looks at the role mass timber might play in building large numbers of affordable homes.
Portland Exodus: Increasing taxation and mounting quality-of-life problems have motivated many Portland residents to leave the city, Willamette Week reports. The story cites our 2022 Ernst & Young report on escalating state business taxes.
Metro Tax Nonpayment: Almost 25% of six-figure households in the Portland area failed to pay a Metro tax to fund homeless services in 2021, The Oregonian reports. Some also failed to pay the Multnomah County tax to fund universal preschool in 2021. Neither Metro nor Multnomah County notified residents that they had to pay the taxes, and tax software used by many people didn’t direct them to pay.
Semiconductor Land: A proposal to develop rural reserve land in Washington County for semiconductor production has met with opposition from conservation groups and Metro Council President Lynn Peterson, the Portland Business Journal reports.
Climate Protection Program: A Public Utilities Commission report expresses concern about progress toward greenhouse gas reductions required by the state Climate Protection Program, the Oregon Capitol Chronicle reports. The PUC also acknowledges that “costs are likely to rise for customers across the state during the next decade as the companies attempt to come into compliance.”
Klamath Pumped Storage: The developer of a proposed pumped-storage hydropower project in Klamath County has asked federal regulators for more time to begin construction, the Portland Business Journal reports. However, executives with Rye Development say they expect construction on the $1 billion Swan Lake North project to begin in 2024.
Legislative and Rulemaking Updates
General: The third week of the legislative session served as a transition point of sorts, from a preponderance of informational hearings during the first two weeks to a much higher volume of bill-specific hearings in week three. As of Feb. 3, 2,216 bills had been introduced, of which OBI is currently tracking over 900. The biggest conversation point for the week was the release of the governor’s recommended budget.
OBI Revenue Bills: Last week was a busy one for OBI in the House Revenue Committee. Three of OBI’s tax-related Growth & Innovation Roadmap bills had hearings and—good news—the chair intends to advance all three. HB 2575 would give membership associations, like OBI, standing to file suit on behalf of members in the Oregon Tax Court. HB 2576 would give the Oregon Tax Court jurisdiction over local income tax issues. HB 2548 would require that local governments use state standards, including apportionment and income source definitions, for any locally imposed income tax. We are working with a stakeholder group to move passage of these bills, and Scott Bruun provided spoken and written testimony on each, which you can find by clicking the links above and choosing “testimony.”
DEQ Director Appointment: The Environmental Quality Commission (EQC) has meetings scheduled this week, and we expect it to make a final selection on the new DEQ director position at week’s end. The two finalists are Leah Feldon, interim director and longtime DEQ staffer, and Jamie McLeod-Skinner, recent candidate for Oregon’s 5th Congressional District. Sharla Moffett of OBI and a few other stakeholders were invited to participate in observing interviews and providing feedback to the EQC. As you can imagine, this is a very consequential hire. With so much going on in DEQ and no slowdown on the horizon, stability and knowledge of the issues and processes are important.
Age Discrimination: On Feb. 6, the House Committee on Business and Labor will hold a hearing on HB 2800, which would drastically expand and confuse age discrimination in employment under Oregon law. The bill establishes that information that could be used as a proxy for age is also “age discrimination” and states that this shall be liberally construed. Under the proposal, considering seniority or length of service (i.e. experience) would be prohibited; further, phrases that could be “liberally construed” to hint at age would be prohibited. Not only is the bill confusing, but it also contradicts other Oregon law that expressly allows consideration of things like experience (pay equity laws). It also will ensure that already burdened courts are even further bogged down.
Hood River-White Salmon Bridge: On Feb. 7, the Joint Committee on Transportation will hold a public hearing on SB 431, which provides a $125 million appropriation to the Port of Hood River for construction of the Hood River-White Salmon Interstate Bridge. OBI will submit testimony supporting the appropriation as we have previously, noting the importance of the bridge for many reasons from workforce to emergency services.
Leave for Board/Commission Service: Last week, OBI testified in opposition to HB 3028, which would allow employees to take unpaid leave for their service on boards, commissions, committees and councils created by statute. We raised several concerns around notice, unlimited leave, the inclusion of a private right of action and the expansive way someone could interpret board/commission service. Proponents are offering an amendment that would limit the bill to those employees who serve on boards and commissions only, require employees to provide employers with at least 30 days’ notice and remove the private right of action. We will closely analyze those changes to see if the bill is workable.
Universal Health Care: SB 704, establishing a Universal Health Care Governance Board, was scheduled to be heard in Senate Health Care on Jan. 30, but has been rescheduled for Feb. 13. OBI opposes this bill. The last estimate by the Universal Health Care Task Force was $26 billion annually, a significant portion funded through employer payroll taxes.
Enterprise Zones (EZ): On Feb. 6, OBI will testify on SB 134 and SB 135, which would extend sunset dates for Oregon’s enterprise zone and rural enterprise zone programs, respectively, from 2025 to 2032. The extension of Oregon’s EZ programs is a key component of OBI’s Growth & Innovation Roadmap. EZs provide a temporary partial abatement of property taxes to qualified applicants, a vital and demonstrably successful job-creation tool for Oregon employers. Given Oregon’s rising overall tax burden, the mitigating value of EZ programs has never been more important.
R&D, Capitol Investment Tax Credits: Thank you to OBI Tax & Fiscal Policy Chair Rob O’Neill—a nationally recognized expert in state tax incentive policy—for submitting comprehensive testimony to the Joint Committee on Semiconductors. Rob’s testimony is a necessary component in helping legislators understand the competitive importance of and optimal design for R&D and capital investment tax credit instruments in Oregon. Read Rob’s testimony here.
Retail Crime Package Forthcoming: OBI, as part of the Organized Retail Crime Task Force, is working on a policy and funding package to quell the rampant rise in retail thefts from businesses in Oregon. The package includes funding for an analyst position within the Oregon Department of Justice that would coordinate with law enforcement, private security units, and prosecutors. Additional funding would set up a grant program for local law enforcement to use for advanced stings. The package also would make several changes to criminal statutes in Oregon, including those involving sentencing and setting the aggregated value of stolen merchandise. These changes would make prosecuting criminals easier.
Washing Machines: Last week, the Senate Committee on Energy and Environment heard SB 504, which would make Oregon the first state to require clothes washers to come with microfiber filtration systems. OBI testified in opposition because adopting this requirement would make Oregon a national outlier, place unnecessary burdens on both businesses and consumers, and almost certainly reverse the gains industry has made to make clothes washers more efficient through reduced water and energy use.
Substance Abuse and Opioids: On Jan. 30 the House Committee on Behavioral Health and Health Care heard bills involving substance abuse and opioids. The governor’s recommended budget specifically highlights addressing behavioral health and substance abuse issues plaguing Oregon, so we expect to see a lot more conversation dedicated to those topics. On Feb. 1, House Health also heard bills involving health care workforce issues and will hear more on Feb. 7. Identifying strategies to address workforce and staffing shortages across the health care system throughout Oregon likely will be a recurring theme this session.
OBI, Stoel Rives to Partner on Air Permitting Workshop
OBI and law firm Stoel Rives will host a workshop on Feb. 24 to cover Oregon’s new air permitting rules. OBI’s Sharla Moffett will be joined by Stoel Rives attorneys Tom Wood and Geoff Tichenor as well as air quality consultants with Maul Foster Alongi, Trinity Consultants and Bridgewater Group.
The hybrid workshop will run from 9-11 a.m. at Stoel Rives’ Portland office, where there will be room for about 50 participants. A remote option will be available as well. We will provide registration information when it becomes available.
Save the Date: OBI Annual Meeting Set for May 17
The OBI Annual Meeting will take place May 17 at the Salem Convention Center. Please stay tuned for additional information, including the time, agenda and registration link.
The Annual Meeting is a chance for hundreds of our members to get together, hear an organizational update from our board leadership and OBI staff, and network with each other as well as elected officials. This event typically features a high-profile keynote address or political panel. Past speakers include A.B. Stoddard of RealClearPolitics and Jay Timmons, president and CEO of the National Association of Manufacturers. The 2022 Annual Meeting included a post-primary election forum involving the three leading candidates for governor.
The Annual Meeting is also an opportunity to bestow our Jobs Champion Award to legislators and civic leaders who embody the values and mission of OBI. In recent years, the Jobs Champion Award has been given to Brad Hicks, retired president and CEO of The Chamber of Medford and Jackson County; Sen. Betsy Johnson, D-Scappoose; former Rep. Jeff Barker, D-Aloha; and Rep. Shelly Boshart Davis, R-Albany, for their bipartisan work promoting Oregon jobs.