Policy and Rulemaking Updates
Portland Incentives: Good but Not Enough
On. Sept. 14, the Portland City Council unanimously passed a tax credit designed to incentivize businesses to lease (or renew leases) in several areas of the city, including downtown, Old Town/Chinatown and the Lloyd District. Read the press release here.
The policy gives businesses a credit against Portland’s business license tax owed in one year, up to a maximum of $250,000. To qualify, businesses must enter a new lease or extend an existing lease for at least four years. Those businesses also must maintain at least 15 employees and attest to having workers in the offices on at least a half-time basis.
Approval of this credit followed on the heels of another decision by the Council to approve an enterprise zone program for the downtown and northwest Portland industrial areas. This program, KATU reports, includes a five-year property tax abatement for qualified businesses.
OBI is pleased that Portland’s city leaders seem to be addressing the real challenges and turmoil faced by Portland-area businesses. We would note, however, that among the biggest challenges those businesses have faced in recent years is the proliferation of new and increased local taxes. Portland’s combined state and local marginal income tax rate is the second highest in the nation, trailing only New York City, an Ernst & Young study funded by OBI found. Two new economic incentives, while positive, will not adequately mitigate the growing patchwork of taxes and fees paid by businesses to the city of Portland, Metro and Multnomah County. OBI will continue to encourage Portland’s leaders to look at comprehensive tax reform as a necessary part of revitalization and competitiveness.
NLRB Decision Likely to Increase Unfair Labor Practice Claims
A recent National Labor Relations Board (NLRB) decision will make it easier for the independent general counsel (who is responsible for prosecuting unfair labor practices) to allege unfair labor practice claims. Prior to its decision in Intertape Polymer Corp., the NLRB required – under the so-called Wright Line test – the general counsel to show an adverse employment action was due to particularized hostile motivation or “animus” toward an employee’s protected activity. The general counsel may now meet the burden by showing evidence only of anti-union animus even if it is not directed at the specific employee’s protected activity.
The new rule upheld an unfair labor practice involving a verbal warning to a union steward and a production employee who failed to clean several rolls of tape that had fallen to the floor. Those warnings followed a disagreement between the company and the union in which a production manager had stated he was not going to “allow the union to bully management” because an electrician and the union steward would not describe how the electrician extinguished a machine fire without first locking the machine. The NLRB found the company committed unfair labor practices because it had not previously disciplined an employee for inadequate cleaning and the discipline came soon after the company received grievances arising from the production manager’s disagreement with the union steward and electrician over the machine fire.
Following this decision, the general counsel likely will use stray anti-union comments or actions to allege unfair labor practices, and the NLRB will have leeway to find more violations, especially in gray areas. To avoid this pitfall, employers should ensure their legitimate and lawful business rationales are well documented before making employment decisions and consistently apply clear policies. Read an analysis by the Society for Human Resource Mangement here.
Employee Commute Options Rulemaking Remains on Hold
The Department of Environmental Quality’s (DEQ) Employee Commute Options rulemaking remains on hold. The agency paused the rulemaking indefinitely in May after OBI, other employer stakeholders and House Republicans expressed major concerns with the draft rule. The agency committed to gathering more stakeholder input before moving ahead with the rulemaking.
A 1996 regulation requires employers with more than 100 employees in Clackamas, Multnomah and Washington counties to reduce drive-alone commuting among their employees by 10%, which still remains in effect. The draft rule proposes to double that requirement, which could be especially challenging for employers that require an in-person workforce. It also requires that employers provide a prescriptive set of commute options. Meanwhile, the proposal would expand the program statewide to include employers with more 100 employees or more in cities with populations greater than 50,000 (Salem, Albany, Corvallis, Eugene, Springfield, Medford and Bend). Employers in these seven cities would be required to reduce employee commuting by 15%.
In a listening session held in June by OBI, employers in the seven cities told DEQ that the draft rule would be extremely costly to implement and do little to reduce drive-alone commuting since the proposal is tailored to large metropolitan areas and assumes that employers have convenient access to public transit. OBI is continuing to work with DEQ to find more viable and lower-cost alternatives to the current proposal before the rulemaking moves forward.
Oregon Seeks to Create Basic Health Plan
The Oregon Health Policy Board voted unanimously Sept. 12 to approve a basic health plan (BHP) blueprint application. Oregon is only the third state in the country, behind New York and Minnesota, to seek federal approval for a BHP. It is an option under the Affordable Care Act intended to provide less expensive coverage to low-income residents. It is also a move toward establishing universal health care coverage.
The BHP will cover people who earn 138% to 200% of the federal poverty level. New York’s and Minnesota’s plans generate revenue through co-pays and cost sharing, but the Oregon Health Authority claims it will be able to fund the BHP almost fully with federal funds. The program is set to launch on July 1, 2024, which creates a tight timeline, particularly given the complex logistics involved in rolling out such a plan. This Oregon Public Broadcasting article provides a good overview of the details.
Election Updates: Rep. Khanh Pham, D-Portland, has announced that she will seek the seat of retiring Sen. Michael Dembrow, D-Portland, the Oregon Capital Chronicle reports. Meanwhile, reports the Chronicle, Rep. Vikki Breese-Iverson, R-Prineville, will step down as House minority leader. And longtime Attorney General Ellen Rosenblum has announced that she will not seek reelection in 2024, according to The Oregonian.
Oregon Education: Oregon students’ performance on writing and math tests remains mired in “dismal post-pandemic lows” despite the expenditure of billions of state and federal dollars, reports The Oregonian. Only 40% of students tested in the spring were proficient in reading and writing compared with 51% before the pandemic. Math results were even worse, with only 30% of students proficient compared with 40% before the pandemic.
Agency Spending: Auditors in the Secretary of State’s Office flagged more than $35 million in questionable spending in the Oregon Department of Human Services, Oregon Health Authority and the Higher Education Coordinating Commission, according to the Oregon Capital Chronicle. The audit, released Sept. 20, examined the spending of billions of dollars in federal aid received in 2022.
I-205 Plans: The Oregon Department of Transportation says it will scrap plans to toll on one Interstate 205 bridge while proceeding with plans to toll on a second bridge, reports The Oregonian. The agency also said it will not build a third lane on a seven-mile stretch of the freeway between Tualatin and Oregon City. Tolling will proceed as planned on the Abernethy Bridge in Oregon City but will not happen on span crossing the Tualatin River six miles to the west.
Robot Factory: Corvallis startup Agility Robotics, an OBI member and Coolest Thing Made in Oregon finalist, has announced that it will open a factory in Salem this year that will be able to build more than 10,000 robots per year, The Oregonian reports.
Wine Growth: Oregon’s wine industry continued to grow in 2022, approaching $1 billion in sales and adding 2,600 planted acres of grapes, a 6.2% increase, the Portland Business Journal reports.
Gas Refund: A Tri-Cities lawmaker plans to introduce a bill in 2024 that would give registered Washington vehicle owners $100 each or $200 per family, reports The Columbian. Rep. April Connors, R-Kennewick, says the so-called Carbon Auction Relief Payment would send some of the revenue collected under Washington state’s new carbon allowance auctions directly to state drivers. The program has contributed to a significant increase in the cost of fuel.
Likelihood of Oct. 1 Government Shutdown Increasing
A government shutdown will happen Oct. 1 unless Congress approves a continuing resolution that would provide short-term funding while the House and Senate agree on full-year spending plan. Read CNN’s explainer here.
If a shutdown happens, “essential” government operations would continue while others would come to a halt. Essential operations are those that preserve public safety and national security or are deemed critical for other reasons. They include border protection, federal law enforcement and air traffic control.
In anticipation of a shutdown, the U.S. Chamber of Commerce has created a memo with more detail about the possible length of a shutdown and the implications for businesses and the economy. Go here to read the memo.
Paid Leave Oregon Issues Fact Sheets for Common Questions
Paid Leave Oregon (PLO), the state’s paid family and medical leave insurance program, has partnered with the Bureau of Labor and Industries to produce three documents to clarify how paid leave works with the Oregon Family Leave Act (OFLA), paid time off and job protections.
- This document features a list of common questions and answers about how OFLA and PLO work together.
- This document answers common questions about job protections under PLO. For example, employers must protect the jobs of people who take paid leave if they’ve worked for them for at least 90 days.
- This document explains employee and employer rights and obligations when an employee asks for earned paid time off (personal time, for example) when the employee takes protected leave under PLO, OFLA or both.
Finally, there’s still time to sign up for OBI’s Oct. 19 webinar during which PLO staff, including policy lead Shannon Ball, will provide program updates and answer questions. Go here to register.
Angela Wilhelms’ Op-Ed Previews Manufacturing Roadshow
On Sept. 24, The (Bend) Bulletin featured a guest column by OBI President and CEO Angela Wilhelms previewing the central Oregon leg of this year’s Manufacturing and Innovation Roadshow. The Roadshow, which begins Oct. 2 in Pendleton, will visit three manufacturers in central Oregon Oct. 3 (see the itinerary in the item below).
Oregon’s business environment has become markedly less competitive in recent years for all employers, Wilhelms points out, placing Oregon at an inflection point. Unless the state’s business climate improves, manufacturers and other employers will invest increasingly in other states. Jobs, innovation and tax revenue will shift accordingly.
The Legislature did take important steps this year, Wilhelms notes. But these are small steps, and lawmakers must do more to make the necessary improvement in Oregon ‘s competitiveness.
Registration Open for Manufacuring Roadshow
Registration is now open for OBI’s second annual Manufacturing and Innovation Roadshow, which will visit facilities in eastern Oregon, the Columbia River Gorge, Hood River, central Oregon and the northern Willamette Valley in early October.
The itinerary, which will be expanded in the coming weeks, includes the following stops:
- Oct. 2: Pendleton Chamber of Commerce roundtable breakfast, Pendleton Woolen Mills, Tillamook Columbia River Processing (Boardman), Hood River Distillers.
- Oct. 3: Daimler Truck North America Proving Grounds (Madras), Bend Chamber of Commerce roundtable lunch, Epic Aircraft (Bend), BASX Solutions (Redmond).
- Oct. 4: Freres Engineered Wood (Lyons), Salem Area Chamber of Commerce roundtable lunch, Machine Sciences Corp. (Tualatin), PGE Sherwood Training Center.