2025 Legislative Session Concludes
The 2025 legislative session concluded at 11:15 p.m. on June 27, just two days before its constitutionally mandated deadline. It saw the introduction of 3,466 measures, nearly 20% of them “placeholders” upon introduction.
In the end, the session produced a handful of high-profile laws that will, unfortunately, erode Oregon’s economic competitiveness even further. These include bills to provide unemployment insurance benefits to workers who voluntarily leave work to strike; to increase costs and liability for good actors, who can now be held responsible for others’ illegal actions; and to loop manufacturers into prevailing wage laws under poorly defined and difficult-to-enforce language.
Overall, however, the business community was protected from a number of other bills that threatened to raise taxes and other costs, increase risk and liability and undo heavily negotiated agreements between the state and industry.
The session will be known in part for what it didn’t accomplish. OBI entered the session looking to support smart, responsible spending on transportation infrastructure. However, the package introduced in the final weeks of the session was a far cry from the “back to basics” plan Oregonians were promised. Most legislators agreed, and the package ultimately failed despite final-day attempts to winnow it down.
When we consider the failure of lawmakers to pass many policies that would have improved Oregon’s business climate and the hard work required for OBI’s policy team and allied organizations to ensure many harmful proposals were either mitigated or left on the table, it’s clear that legislative leaders were not committed to addressing the problems OBI described last year in the Oregon Competitiveness Agenda. That’s risky for Oregon’s future.
OBI will have a more robust legislative recap available in our end of session report. For now, we’ll provide a handful of policy and bill updates from the last week of the session (below). Stay tuned for that report, which will include key takeaways, key bills and other observations.
And, after a few days of rest, the team will be back at it in July, preparing for the 2026 session and engaging in the rulemaking process.
Here are a couple of news stories recapping adjournment: “Oregon Legislature adjourns 2025 session as Democrats’ transportation plans stumble” (OPB) and “Lawmakers close out 2025 session with housing, mental health wins, botched transportation package” (The Oregonian).
Transportation Package Fails amid Upheaval and Scrambling
The 2025 transportation funding saga saw a lot of activity in the last week of the session. Ultimately, the transportation package died July 27 amid opposition to major tax and fee increases and the lack of a solution to inequitable trucking taxes. The final straw may have been the breaking of a longstanding revenue-share model involving the state and local jurisdictions, which drove counties and cities to oppose the final, final amendment.
The week began with upheaval over the composition of the Joint Committee on Transportation Reinvestment. Committee Co-Chair Sen. Chris Gorsek, D-Gresham, resigned his post amid criticism over his conduct the previous week, when he shouted down Rep. Shelly Boshart Davis, R-Albany, a committee co-vice chair. Rep. Paul Evans, D-Salem, abruptly resigned as well. And Senate President Rob Wagner, D-Lake Oswego, joined temporarily after booting Sen. Mark Meek, D-Oregon City, for being a “no” vote. An existing member became the new co-chair, and three new members were appointed.
On June 26, the committee considered the -28 amendment, a slightly slimmed-down version of HB 2025A. The amendment represented a $11.67 billion package — about $3 billion less than the revenue estimate for HB 2025A. The -28 reflected many changes, including:
- A 12-cent gas tax increase (instead of 15 cents)
- A more than 240% increase in weight-mile taxes paid by freight vehicles
- Deleting the vehicle “transfer” sales tax (essentially a sales tax) but increasing the vehicle “privilege” sales tax from 0.5% to 2.25%
- More modest fee increases in comparison to HB 2025A
- Road user charges for EVs and high mileage vehicles remained the same
- Some changes in the allocation of revenue
- No changes to the tripling of the employee-paid payroll tax.
OBI testified in opposition to the -28 amendment, but it passed with support from all committee Democrats and one Republican, Rep. Kevin Mannix, R-Salem.
When it became apparent on the morning of June 27 that the bill did not have enough votes to pass the House and Senate, leadership turned their attention to a new placeholder bill in the House Committee on Rules. The proposed amendment for that bill included a 3-cent gas tax increase and a $20 passenger vehicle registration fee increase … just enough, supporters claimed, to provide enough funding for ODOT to avert layoffs. Gov. Kotek testified in support, as did SEIU. Aside from that, the proposal was met with a raft of opposition, namely from local and county officials frustrated by the massive breach of trust that occurred when the proposal put all of the gas tax revenue into state coffers rather than splitting it 50/50 with local governments per existing law (and understanding).
Despite opposition, the committee adopted the amendment on a party-line vote and moved it for a floor vote. However, the writing was on the wall. Because there was not enough time left in the session for the prescribed legislative timeline to unfold, holding a vote would have required rules to be suspended. Republicans refused a request by House Speaker Julie Fahey, D-Eugene, to suspend the rules.
Rumors of a special session have emerged, as have rumors that an attempt will be mounted to pass a transportation package during the 2026 session. OBI stands ready to be a part of that discussion. We support spending on infrastructure that appropriately satisfies the needs of all stakeholders.
Additional Legislative Updates
FISH & CHIPS battered: As the session started, nearly $40 million remained in the Oregon CHIPs fund established in 2023. OBI supported two bills relating to this fund: HB 2277, which decoupled Oregon’s CHIPs funds from federal investment requirements; and HB 2322, which allocated $25 million of the remaining funds to a new companion fund, Fostering Innovation Strength at Home (FISH). FISH funding would have been available to a larger range of industries than CHIPs funds. No known opposition to the legislation existed, and the House Committee on Small Business, Economic Development and Trade passed both unanimously.
In the meantime, $10 million of the CHIPs fund’s remaining $40 million was diverted to related child care infrastructure. This wasn’t an ideal use of the money, but there is a nexus to the original agreement from 2023. The remaining $30 million was approved for “carryover” from 2023-25 to the current biennium via the Business Oregon budget.
The Joint Committee on Ways and Means passed HB 2322, expanding eligibility by adding the FISH fund and allocating half of the carried-over $30 million. Another different bill, SB 960, swept the other $15 million for general purposes. But here’s the catch: The Senate didn’t pass HB 2322, and it died. Thus, there is no FISH fund, just the preexisting CHIPs fund. And the sweep in SB 960 specifically referenced a sweep from the FISH and CHIPs fund. So, statutory analysis leads us to believe that all that work was done to end up right back where we started. There is $30 million left in the CHIPS fund from 2023.
In the end, the Legislature failed to pass even the most modest of economic development bills – HB 2322 – while approving a related bill – SB 960 – predicated on the passage of a bill that failed.
Prevailing wage expanded: HB 2688 barely passed both chambers in the last days of session. The bill requires the payment of the prevailing wage to workers in off-site facilities that are manufacturing certain items for public works projects. While proponents say these items must be custom-made (or bespoke) for a specific project, it is unclear how BOLI will enforce the law and how the agency will interpret “custom” and “bespoke.” Local governments have made it clear that the bill will make many projects much more expensive, including housing. On June 26, the House passed the bill 31-22. Rep. Greg Smith, R-Heppner, joined most Democrats in voting for the bill. Notably, Democrats Annessa Hartman of Happy Valley, Shannon Isadore of Portland and Mari Watanabe of Bethany voted against the bill. On June 27, the Senate passed the bill 16-13 with Democrats Jeff Golden of Ashland and Mark Meek of Oregon City joining Republicans in opposing it.
Lodging tax bills: A pair of bills involving transient lodging taxes died in the session’s waning days. HB 3962 generally would have reduced the share of local transient lodging tax (TLT) revenue that must be used for tourism promotion or tourism-related facilities from 70% to 40%. HB 2977 would have increased the statewide TLT from 1.5% to 2.75% and directed the new revenue to wildlife preservation. Both narrowly passed the House, and each received a hearing and passed out of a Senate committee. Fortunately, both subsequently languished and failed to receive a full Senate vote. OBI was proud to join the Oregon Restaurant and Lodging Association and many local chambers and tourism/marketing organizations in opposing these changes. Transient lodging taxes are among the state’s few remaining sources of funding dedicated to economic development.
Salt cap workaround: The Senate on June 17 unanimously passed SB 111, which as amended would have extended Oregon’s SALT cap workaround program, expanded it to businesses organized as trusts and allowed individual members of pass-through businesses to opt out of the program. However, the House Committee on Revenue stripped out the expansion and opt-out provisions, passing a version that simply extended the program until 2028. Even this pared-down version would have helped state businesses, however. Unfortunately, the House never held a floor vote on this important policy, and leaders never explained why. As a result, Oregon’s private sector will lose an important tool to reduce its tax burden without also reducing state revenue. The state’s economic competitiveness will suffer.
Insurance bill dies: SB 174 would have punished insurance companies under Oregon’s extreme Unlawful Trade Practices Act for even minor violations of Oregon’s extensive insurance regulatory framework. Nevertheless, it passed the Senate on June 23 by a 16-12 vote. Fortunately, the bill subsequently sat in the House Committee on Rules for the rest of session. It would have increased litigation and insurance costs in Oregon dramatically.
Misguided ‘disconnect’ dies: HB 2092 would have changed Oregon’s longstanding practice of connecting to federal tax law by freezing connection as of Dec. 31, 2024. Fortunately, the bill died. It would have complicated tax compliance and administration for individual and business taxpayers even as the state’s tax-competitiveness rankings continue to slip. Between 2019 and 2025, Oregon’s overall ranking in the Tax Foundation’s State Tax Competitiveness Index fell from 7th to 30th. In the same index, Oregon’s corporate tax competitiveness now ranks 49th. HB 2092A would not have helped.
Campaign finance reform: Despite OBI’s interest in working this topic at the start of session precisely to avoid late-session chaos, legislative leaders continually put this work off until the session’s final weeks. And in the end, late-session efforts to advance technical fixes to the campaign finance package adopted in 2024 failed. Rather than passing technical fixes, the House Committee on Rules briefly considered delaying implementation of the law by four years, from 2027 to 2031. Despite compelling testimony from Secretary of State Tobias Read, who thoroughly explained the challenges his agency is facing in attempting to implement the law on a condensed timeline, lawmakers took no further action. In the wake of the Legislature’s failure, the Secretary of State’s Office must continue to implement a law all stakeholders agree needs fixing. OBI will continue to participate in the related rules advisory committee, offering feedback consistent with the legislative intent of HB 4024 (2024) and in line with our goal of promoting an equal playing field for all who engage in elections. OBI also will immediately begin to prepare a package of technical fixes to be considered in the 2026 legislative session. We are cautiously optimistic that lawmakers will be more prepared to advance such legislation at that time.
Wildfire litigation bills: Throughout the session, the Legislature considered several bills that would have undermined principles of due process and civil procedure. Many Oregonians who lost a great deal in the 2020 Labor Day fires are involved in litigation against PacifiCorp. Though lawmakers wanted them to be made whole, many were uncomfortable with proposals that would have done this. SB 926 would have penalized defendants simply for exercising their appeal rights. OBI worked against the bill in part because of the precedent it could set for defendants in future litigation. Fortunately, the bill failed to emerge from the Joint Committee on Ways and Means. Another bill, HB 3984, was a placeholder amended in the House to require PacifiCorp to pay plaintiffs for any taxes that might be owed on settlements and judgments related to wildfire damage claims. It also would have created a wildfire safety certification program administered by the Public Utility Commission. The bill passed the House on the last day of session but ultimately did not advance in the Senate.
‘Compensation cost’ allocation: One of the last bills passed this session, HB 5006 allocates $300 million “to state agencies for state employee compensation changes,” providing special appropriations for bargained-for compensation costs that should be managed within agency budgets. Even more interesting, the bill allocates $75 million “to state agencies for compensation changes driven by collective bargaining agreements for workers who are not state employees.” OBI will do a more comprehensive budget review in our end of session report.
OBI Talks with Escape Lodging CEO Patrick Nofield
With Oregon’s summer travel season kicking into high gear, the Oregon Business Matters podcast talks with Patrick Nofield, chairman and co-founder of Escape Lodging.
Based in Cannon Beach, Escape Lodging owns and operates hotels and restaurants on the Oregon Coast, in the Columbia River Gorge and in the Willamette Valley. Escape also has developed properties in Pasco and Richland, Wash.
In addition to running Escape Lodging, Nofield serves as board chair for the Oregon Restaurant and Lodging Association, which advocates for the state’s hospitality industry.
Nofield talks with host Angela Wilhelms about the evolution of Escape Lodging, how the company decides where to open new properties, the opportunities and challenges of operating a business in Oregon and more.
Oregon Business Matters focuses on insights, issues and initiatives that affect Oregonians’ shared prosperity and the state’s economy.
Episodes can be found on OBI’s website here and on major podcast platforms, including Apple, Spotify and YouTube.
Learn about AP Business Principles/Personal Finance Course
Skills-based education is a critical piece of developing today’s (and tomorrow’s workforce). Students also need a robust personal finance education to prepare them to live on their own – and even start their own business. For these reasons, teaching business and finance skills to high schoolers is a no-brainer.
With that in mind, OBI is working with the U.S. Chamber of Commerce to promote AP Business Principles/Personal Finance, an experiential course developed by the College Board that will be offered to high school students nationwide starting in the 2026-27 school year.
On June 26, OBI President and CEO Angela Wilhelms spoke with Clare Bertrand, the College Board’s director of career strategy and business partnerships, about the course and what employers can do to ensure that it becomes established and grows in Oregon.
Go here to watch a recording of Bertrand’s presentation about the course and the discussion that follows.
Disaster Loans Available for Microwave Tower Fire Losses
Eligible small businesses and nonprofit organizations that suffered economic losses caused by the 2024 Microwave Tower Fire have until July 29 to apply for low-interest federal disaster loans.
According to the U.S. Small Business Administration, eligible businesses may apply for loans as large as $2 million through its Economic Injury Disaster Loan program. Loan rates may be as low as 4% for small businesses and 3.25% for private nonprofit organizations. Terms may extend up to 30 years.
The disaster declaration covers the Oregon counties of Clackamas, Gilliam, Hood River, Jefferson, Marion, Sherman, Wasco and Wheeler and the Washington county of Klickitat.
Go here to learn more about the loan program and here to apply. Interested businesses also can call the SBA at (800) 659-2955 or email disastercustomerservice@sba.gov.
NIC CEO Brian Hall Named Regional Entrepreneur of the Year
On June 23, Brian Hall, CEO of OBI member NIC Industries, was named 2025 Entrepreneur of the Year for the Mountain West region by Ernst & Young. Since 1986, EY’s Entrepreneur of the Year program has honored leaders of successful, dynamic businesses who exhibit ingenuity, courage and entrepreneurial spirit.
NIC Industries is a rapidly growing manufacturer of leading high-performance coatings. The company’s products include powder coatings as well as ceramic-based coatings. NIC Industries maintains a network of more than 4,000 certified applicators across the globe, and its automotive care kits are available online and in major retail stores, including Walmart.
The company employs more than 240 people at its headquarters in White City and in 2024 donated nearly $500,000 to regional schools, nonprofits and youth support programs.
According to a company press release, Hall was chosen by an independent panel of CEOs, business leaders and past winners, who assessed candidates on long-term value creation, entrepreneurial spirit, purpose-driven commitment and significant growth and impact.
EY’s Mountain West region is one of 17 nationwide and includes Oregon, Washington, Idaho, Montana, Wyoming, Utah, Colorado and Alaska. As Mountain West winner, Hall is now eligible to be considered for EY’s Entrepreneur of the Year National Awards. Honorees will be announced in November at the Strategic Growth Forum.
Notable News
Portland airport #1: A new ranking by the Washington Post set out to find the top 50 airports in the U.S. using a combination of passenger recommendations and data analysis. At the very top of the list was none other than Portland International Airport, beating out more than 450 airports from across the country (The Oregonian).
Manufacturing closure: Owens Corning plans to close a door components factory in Prineville, laying off all 184 employees beginning on Aug. 25. It’s the latest in a series of shutdowns and layoffs at Oregon factories, which have produced a sharp decline in manufacturing employment (The Oregonian).
Aging Oregon: Oregon is now one of 11 states where adults age 65 and older outnumber children under 18, according to new population estimates released June 26 by the Census Bureau. The state’s aging population means fewer working-age residents, which could slow economic growth and reduce tax revenue, experts say (The Oregonian).
Hampton mill: Hampton Lumber will build a $225 million sawmill in South Carolina, the Portland-based company has announced. It’s the 83-year-old company’s first sawmill outside the Pacific Northwest and follows a trend of North American industry migration to the U.S. South (Portland Business Journal).
Weyerhaeuser plant: Weyerhaeuser has broken ground on a $500 million plant in Arkansas to produce engineered lumber from the small trees that have piled up across the pine belt after the closure of many pulp and paper mills. It is a big bet on one of the most depressed commodities in America: pine trees that are too small, crooked or otherwise unfit for making lumber (The Wall Street Journal).
Amazon warehouse: Amazon’s enormous new warehouse in Woodburn has 30 miles of conveyors, 6,000 robots and 1,500 employees working to keep the $500 million facility humming around the clock (The Oregonian).
Glove maker sold: A Portland-area glove maker has been acquired by a Valencia, Calif.-based manufacturing competitor. Kinco, a Portland-based industrial glove maker established in 1975, was purchased by Mechanix Wear, which also makes work gloves (Portland Business Journal).
Tax vote scrapped: Members of the regional Metro Council agreed at a work session June 24 that there was not a likely path to passage for a planned November ballot measure that would have sought to extend the region’s unique homeless services tax for another 20 years. Right now, the tax, which was soundly approved by voters in 2020, is set to expire in 2030 (The Oregonian).
Portland area employment: The Portland metro area employment picture is looking a little shaky. The area lost about 7,500 jobs in May, and employment is down about 14,000 in the past year, according to a new report from the Oregon Employment Department (Portland Business Journal).
Bend infill housing: After years of idling, one of the largest infill housing developments in Bend is moving forward. On June 19, excavators began grading dirt and removing juniper trees at the rugged 33-acre site near the intersection of 15th Street and Wilson Avenue — 10 years after development plans there were first approved by the city of Bend (The Bulletin).
Nike stock jumps: Nike late June 26 reported a 12% quarterly sales decrease, but it’s what’s next that has many Wall Street traders excited. The sportswear giant has been in a rare and sustained slump, reporting five consecutive quarters of decreased sales, but some analysts think first-year CEO Elliott Hill is finally getting the company back on track. On June 27, Nike’s stock jumped 16% in early trading, with several stock analysts encouraging investors to buy shares.
Retaliation claim: A “smoke taint” lawsuit has taken a surprising turn with an allegation that PacifiCorp “threatened and retaliated against” Nik Blosser, a former top aide to Gov. Kate Brown and executive at Portland General Electric (Portland Business Journal).
Vigor organization: Titan Acquisition Holdings has put Portland’s Vigor Industrial and its other marine and industrial service companies under the new banner Vigor Marine Group. The holding company remains headquartered in Portland with Vigor Marine Group itself (Portland Business Journal).
Portland permitting: A plan to cut 53 full-time positions from Portland’s Permitting & Development Department has been drastically downsized, for now, following the approval of Mayor Keith Wilson’s 2025-26 budget (Portland Business Journal).
Door plug investigation: National Transportation Safety Board Chair Jennifer Homendy said June 24 that the heroic actions of the crew aboard Alaska Airlines flight 1282 ensured everyone survived the terrifying incident last year when the door plug panel flew off the plane shortly after takeoff in January of 2024. But Homendy said “the crew shouldn’t have had to be heroes, because this accident never should have happened” if Boeing and the Federal Aviation Administration had done enough to ensure the safety of the Boeing 737 Max plane (The Associated Press).
Bend housing rebates: Over the next several decades, the city of Bend is set to make a $96 million investment in multifamily housing. The city has promised a rebate on property taxes for a handful of developers if they can build apartments with a certain level of affordability in the next few years (The Bulletin).
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.