How to Help Those Affected by Los Angeles Wildfires
Like all who have watched the devastating effects of this month’s wildfires in Southern California, OBI would like to express our deepest concern for those who have been affected. OBI also would like to share our gratitude and admiration for the firefighters and other first responders, including many from Oregon, who have worked to protect people and property.
OBI members who would like to contribute to affected business can do so by visiting the California Chamber of Commerce’s wildfire resources web page. The page includes a link to the Los Angeles Wildfire Relief fund established by the California Foundation for Commerce and Education.
State of State Address Caps Legislative Organizational Session
Oregon’s 83rd Legislative Assembly officially began Monday during an organizational session that saw the election of House and Senate leaders and concluded with Gov. Kotek’s delivery of the state of the state address.
Rep. Julie Fahey, D-Eugene, was elected speaker of the House, and Rep. David Gomberg, D-Otis, was elected speaker pro tempore. Sen. Rob Wagner, D-Lake Oswego, was elected Senate president, and Sen. James Manning, D-Eugene, was elected Senate president pro tempore.
Fahey and Wagner covered little new ground in remarks offered after their swearings-in and, separately, before the governor’s address. Fahey indicated that her chamber would focus on housing affordability, utility oversight and access to health care during the 2025 session. She also emphasized the need to pass a transportation package and rethink methods of funding transportation. Finally, she expressed a desire to improve student outcomes in K-12 public schools. In his remarks, Wagner declined to offer a policy vision for the session, pleading instead for comity.
The governor’s address likewise focused largely on issues she has prioritized during her two-year tenure: homelessness, housing, mental health and addiction, and support for K-12 education.
Notably, however, the governor echoed Fahey in arguing for a “legacy package to serve Oregon’s transportation needs for years to come.” She also pledged to improve transparency and consistency in state rulemaking. Regulatory modernization is a cornerstone of OBI’s recently released Oregon Competitiveness Agenda. OBI looks forward to working with the governor and the Legislature on these issues.
Unfortunately, none of the three elected leaders mentioned Oregon’s eroding business climate or the need to improve it. A thriving private sector and the revenue it produces are necessary to support the goals described Monday by the governor and legislative leaders. OBI will continue to talk with elected leaders about the risks to our state’s future and the prosperity of its people if they devote insufficient attention to economic development and competitiveness.
Useful Resources for the 2025 Legislative Session
Following Monday’s organizational activities, the 2025 legislative session will begin in earnest on Tuesday, Jan. 21, and continue for five months, concluding no later than Sunday, June 29. To keep OBI members informed about the policy team’s work during that period, the Capitol Connect newsletter will appear weekly during the session, beginning in February.
In addition, the resources below provide information OBI members may find useful as the session progresses:
- Oregon Competitiveness Agenda: This is OBI’s agenda for the next two years. Its policy and procedural recommendations, including the modernization of Oregon’s approach to rulemaking and permitting, would improve the state’s economic environment and enhance its competitiveness.
- Printable Legislative Poster: OBI this year has created printable posters featuring photos, party affiliations and districts of House and Senate members. A traditional printed poster will be produced as soon as the open seat for House District 34 is filled. Download the House poster here and the Senate poster here.
- 2025 Legislative Session Page: This page, on OBI’s website, will feature regular updates during about legislative session and the work of OBI’s policy team. It also contains links to key reports.
- Resources for Legislative Engagement: Go here for useful tips on looking up bills, finding your legislators, registering to testify and much more.
- Oregon School Funding: At some point during the session, debate will turn to funding Oregon’s public schools. The state’s schools receive billions of dollars annually from federal, state and local sources – including Oregon’s businesses, largely through the corporate activity tax. Understanding the flow of funds is difficult, at best. In 2024, the OBI Research and Education Foundation commissioned a report that explains where public school funding comes from and where it goes. You can read it here.
- Oregon’s Business Tax Burden: The Legislature sets tax policy, and taxes on businesses have been a popular tool in recent years for state and local policymakers. In 2024, the OBI Research and Education Foundation commissioned a report detailing Oregon’s business tax burden, which has increased substantially since 2019. You can read it here.
- Oregon’s Manufacturing Sector: Decisions made by the Legislature can help – or harm – Oregon’s manufacturing sector, which provides high-paying jobs and produces billions of dollars annually in exports and tax revenue. The Condition of Oregon’s Manufacturing Sector, a report commissioned in 2024 by the OBI Research and Education Foundation, provides a contemporary snapshot of the state’s manufacturing sector, including its recent struggles. You can read it here.
- Oregon Competitiveness Book: Decisions made by the Legislature will affect Oregon’s appeal to businesses interested in expanding or relocating. Provided by the OBI Research and Education Foundation, OBI’s inaugural Oregon Competitiveness Book and related website, released in 2024, contain national rankings in dozens of areas, from power prices to taxation. OBI will release an updated Oregon Competitiveness Book and website in early 2025.
Executive Order Prevents Port of Morrow Shutdowns
Gov. Tina Kotek on Jan. 13 declared a state of emergency that allows for the limited application of wastewater to low-risk fields in the Lower Umatilla Basin. The declaration allows water application from Jan. 15 to Feb. 28, avoiding the “imminent risk” that limited lagoon capacity would force the Port of Morrow to stop accepting wastewater from food processors and other facilities. Should that happen, processors would have to cease operations, furloughing potentially thousands of employees.
The emergency declaration makes an exception to the Port of Morrow’s wastewater permit with the Department of Environmental Quality and allows the port to apply wastewater to some fields within the Lower Umatilla Basin Groundwater Management Area.
The Port of Morrow is currently upgrading its capacity to store wastewater and must complete the construction of new, lined storage lagoons by Nov. 1.
“My office has heard directly from producers and farmers in the Lower Umatilla Basin that pausing operations even for a short time in February would be devastating to the local economy and potentially shut down some operations permanently,” the governor said in a press release.
Go here to read her executive order.
Policy and Rulemaking Updates
Renewable Diesel Crunch: Diesel fuel suppliers raised an alarm during the last week of 2024 about supplies of renewable diesel, also known as R99. Not only was renewable diesel unavailable, they said, but it would remain so for the first quarter of 2025. This is a problem because renewable diesel, a low-carbon alternative to petroleum diesel, is necessary to comply with environmental regulations like Oregon’s Climate Protection Program. Supplies of renewable diesel ran out because a federal tax credit for fuel blenders using non-domestically produced R99 expired at the end of 2024. Though the credit remains in place for domestically produced renewable diesel, there isn’t enough of it to meet demand. To fix the problem, the tax credit must be extended. Legislation to that end has been introduced in both chambers of Congress. Given renewable diesel’s importance in complying with environmental regulations, OBI is working with partner organizations to determine a path forward. Read more from OBI member Star Oil Company here.
Small Business Taxes: On Dec. 10, the Legislative Revenue Office delivered a presentation to the House Interim Committee on Revenue about the changing use of Oregon’s tax preference for small businesses. Developed in 2013, the tax preference generally provides owners of pass-through businesses like LLCs and S corporations the option to be taxed at lower rates than Oregon’s income tax schedule otherwise would require. This is one of the few tax preferences offered to businesses in Oregon, yet the Legislature in 2021 limited eligibility by requiring a minimum employee threshold. During the 2025 session, OBI will push the Legislature to restore this tax preference to its pre-2021 form or to conform Oregon’s small business tax credit to a similar federal preference. Doing either would enhance the competitiveness of Oregon’s small businesses.
Industrial Land Window: Oregon’s one-time window to add industrial land for semiconductor expansion under the Oregon CHIPS Act has definitively closed. Senate Bill 4, passed by the 2023 Legislature, gave the governor until the end of 2024 to designate land for a federally funded research center. However, Oregon’s chances of landing a research center dwindled as the Biden administration announced that two of the three centers funded under the federal CHIPS Act would be built in New York and California. On Dec. 27, Gov. Kotek announced her decision to abandon a proposed designation of 373 acres in Washington County. And just days later, on Jan. 6, the federal government announced that the final research center would be sited in Arizona. Meanwhile, Oregon continues to offer insufficient readily buildable industrial land even as the state struggles with what the state economist recently described as a “manufacturing recession.”
Corporate Transparency Act Remains on Hold
You may have read in December about a handful of developments involving the Corporate Transparency Act (CTA), the 2021 law that requires small businesses to report ownership information to the U.S. Treasury Department. The law’s initial reporting deadline was Jan. 1, but it remains on hold amid a back-and-forth series of court rulings:
- Dec. 3, 2024: A U.S. district court in Texas issued a preliminary injunction blocking enforcement of the CTA. The injunction applied nationally. The U.S. Department of Justice appealed.
- Dec. 23, 2024: A panel of the U.S. Court of Appeals for the Fifth Circuit that handles motions lifted the Texas court’s injunction, reinstating the Jan. 1 reporting deadline. The Treasury Department’s Financial Crimes Enforcement Network extended the filing deadline to Jan. 13, 2025.
- Dec. 26, 2024: A panel of the U.S. Court of Appeals for the Fifth Circuit that considers merits reinstated the nationwide preliminary injunction on enforcement of the CTA, overruling the same court’s motions panel.
Business owners currently are not required to report ownership information under the CTA while courts consider the law’s constitutionality.
Notable News
Clean Trucks Rule: On Dec. 20, Daimler Trucks North America issued a stunning statement: It would stop selling large diesel trucks in Oregon. The reason for that halt: a new rule issued by the Oregon Department of Environmental Quality that took effect Jan. 1 (Willamette Week).
Homeless Tax: Metro President Lynn Peterson on Jan. 9 morning released a much-anticipated outline for a ballot measure that, if referred to Metro voters and passed, would allow the use of revenue generated by the supportive housing services tax for building affordable housing, extend the tax until 2050, adjust the tax rate for inflation and lower the tax in 2031 from 1% to .75% (Willamette Week).
Homelessness Order: Two years after formally announcing a homelessness state of emergency, Gov. Kotek extended the declaration for a second time, issuing an executive order Jan. 9 that will remain in effect until early 2026 (Oregon Public Broadcasting).
Providence Strike: The largest health care strike in Oregon history began Jan. 10 at Providence across the state, as roughly 5,000 frontline health professionals walked off the job (The Oregonian).
Wildfire Maps: Oregon homeowners living in certain areas at high risk of wildfire will face stricter building codes and mandates to reduce vegetation on their properties under new “wildfire hazard maps” unveiled Jan. 7 (Associated Press).
State Forester Resigns: Oregon State Forester Cal Mukumoto has resigned. Mukumoto’s resignation was announced Jan. 9 by Board of Forestry Chair Jim Kelly during a meeting of the board. Mukumoto answers to the board, a citizen panel appointed by the governor that helps oversee and implement forest policy (The Oregonian).
Agricultural Overtime: It’s been nearly three years since Oregon legislators passed a bill requiring employers to eventually pay overtime to farmworkers who work past 40 hours a week. When it passed, advocates said the change was long overdue, while farm groups argued it would hurt their business. Starting this year, employers will have to pay overtime to workers who work more than 48 hours a week. And now some farm owners say they’re having to make tough decisions (Oregon Public Broadcasting).
UPS Closure: UPS plans to temporarily shutter a large package-processing facility on Portland’s Swan Island on July 1, closing it for months to automate much of the work at the site. The closure has UPS’ union workers fearing machines will take hundreds of their jobs (The Oregonian).
Oregonian Editorial: In 2025, Oregonians should see that goals are set and met. They need realistic plans funded responsibly and executed competently. By the end of this year, Oregonians should be given definitive and objective evidence that “crisis” has not become a new word for “status quo” (The Oregonian).
Solar Farms: Large solar farms are on the rise in Oregon, in a push to fulfill the state’s ambitious clean energy mandates. But their rapid rise is leading to worries about how they could reshape the state’s agricultural economy and rural vistas (The Oregonian).
Willamette Valley Vineyards CEO: Jim Bernau plans to step down as CEO of Willamette Valley Vineyards, the Salem Hills winery he founded in 1983 and built into one of Oregon’s biggest wine companies (Portland Business Journal).
Utility Legislation: Three Oregon lawmakers want to stop utility companies from raising rates on customers while those companies are still resolving years-long lawsuits over wildfire culpability and costs (Oregon Capital Chronicle).
Owl Plan Opposition: Several Oregon lawmakers are calling on the incoming administration to nix a plan to kill nearly half a million barred owls on the West Coast, citing the cost and infeasibility. In a letter sent Jan. 7, the lawmakers said the federal plan that calls for specially trained hunters to kill 450,000 barred owls over 30 years would cost $1.35 billion – or $45 million per year – and is “thoroughly impractical” (The Oregonian).
Portland School Bond: Members of the Portland Public School board voted unanimously Jan. 7 to refer a $1.83 billion bond measure to the May ballot, the largest school bond ask in Oregon history (The Oregonian).
Radius Stock: Shares in Portland-based Radius Recycling took a big hit Jan. 8 after the company reported another quarter of weak results. The metals recycler and producer’s stock price fell 22.7% as nearly 1.2 million shares were traded, more than five times average volume (Portland Business Journal).
Macy’s Closures: Department store Macy’s is closing stores in Hillsboro and Salem, two of several dozen locations it is shutting down nationwide. After the closures, Macy’s will have five stores in Oregon, including two in the Portland area, at Clackamas Town Center and Washington Square (The Oregonian).
Check Out OBI’s Member Benefits
OBI offers members a range of programs that can save money or help small businesses offer benefits normally available only to much larger companies. Benefit programs include:
- HealthChoice: Helps businesses with fewer than 100 employees offer comprehensive health-care benefits through our partnership with Regence BlueCross BlueShield of Oregon.
- CompSAFE: Helps eligible companies enjoy workers’ compensation discounts through SAIF Corporation.
- Fuel Program: Helps members save fuel costs through our partnership with Ed Staub & Sons.
- ODP Business Solutions: Helps OBI members save money on office furniture, supplies and other services.
- LegalPLUS: OBI members receive 15 minutes of free legal consulting per month from Innova Legal Advisors.
Go here to learn about all of OBI’s member benefits.