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Government Affairs 2017


  • March 20, 2017 2:02 PM | Shelley Shirley (Administrator)


    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.

    Alison Hart, Executive Director
    alisonh@oregonchamber.org
    503-231-5421

    JL Wilson, Legislative Counsel
    jlwilson@pacounsel.org
    503-363-2182

  • March 13, 2017 1:19 PM | Shelley Shirley (Administrator)

    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: swf.exhibits@oregonlegislature.gov and on HB 2193 to: hbl.exhibits@oregonlegislature.gov

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

    Alison Hart, Executive Director
    alisonh@oregonchamber.org
    503-231-5421

    JL Wilson, Legislative Counsel
    jlwilson@pacounsel.org
    503-363-2182

  • March 10, 2017 9:36 AM | Shelley Shirley (Administrator)


    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: swf.exhibits@oregonlegislature.gov

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

    Alison Hart, Executive Director
    alisonh@oregonchamber.org
    503-231-5421

    JL Wilson, Legislative Counsel
    jlwilson@pacounsel.org
    503-363-2182

  • January 23, 2017 1:08 PM | Shelley Shirley (Administrator)

    Oregon State Chamber of Commerce announces 2017 Legislative priorities Salem, OR – The Oregon State Chamber of Commerce (OSCC) announced today its list of Legislative priorities for 2017. OSCC represents 84 local Chambers of Commerce across the state. 

    “The 2017 OSCC Legislative Agenda is a reflection of our collective desire to see that every Oregon community is able to grow and develop a vibrant local economy that can support each community’s needs. We are good corporate citizens and will come to the table with our colleagues to help develop a revenue platform that business can support. However that cannot take place without meaningful spending reforms that get the most out of every hard-earned taxpayer dollar,” said Colene Martin, OSCC Vice and Legislative Committee Chair. 

    For 2017, OSCC requests that the Oregon Legislature take immediate action to address Oregon’s transportation needs. The OSCC also asks that the Oregon Legislature “pause” on any additional measures that would impose new costs or regulatory challenges for local businesses. Local business communities across Oregon need time to deal with the new 2015 and 2016 laws without additional costs, challenges and uncertainty. 

    OSCC supports: 

    1. Comprehensive transportation funding package (with real low carbon fuel standard cost containment). 
    2. Pre-emption of local employment regulations. 
    3. Expanding eligibility for the 2013 ‘small business tax cut’. 
    4. Increased availability and affordability of workforce housing. 
    5. Increased resources for mental health programs and homelessness prevention. 
    6. Land use/UGB expansion for industrial development and housing. 

    OSCC opposes: 

    1. Predictive Scheduling mandate. 
    2. Employer-funded ‘paid family leave’ program. 
    3. ‘Cap and Trade,’ carbon tax, or Cleaner Air Oregon regulations that imposes burdensome costs on local manufacturers. 
    4. Increasing damage awards for liability, medical lawsuits. 
    5. Elimination of the small business tax cut. 
    6. Taxes not supported by the business community. 

    OSCC is organized to give a voice to the local business communities throughout Oregon in support of policies that enable business success, job growth and income growth in each of Oregon’s local communities. OSCC believes that a healthy business climate, and the jobs that such a business climate creates, is the key to building up local communities, adequately funding social services and making Oregon prosperous. 

    Contact: Alison Hart, Executive Director
    Oregon State Chamber of Commerce
    503-231-5421
    alisonh@oregonchamber.org 

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