2017 Legislative Report – Week 15

Dear OSCC Members and Colleagues –

Here’s a week 15 recap of key issues in the Oregon legislature.

Key Labor Bills:

Predictive Scheduling: SB 828 implements predictive scheduling for food service, retail and hospitality businesses. As part of the bill, business is seeking a total, permanent statewide ban on local scheduling mandates. Unions are coalescing to try and pass this bill as it is their last major opportunity to pass ‘pro-worker’ legislation. The bill is dormant – for now, however OSCC expects that this will resurface and become a major issue in the waning days of session.

Wage Equity: HB 2005 would mandate wage equity among all protected classes for similar jobs. The problem with the bill for business is that it is broadly applied to all Oregon protected classes, it adds a new protected class (armed services veterans), it includes punitive damages, and that each paycheck for which a discrimination is claimed represents its own claim for damages. The bill was amended this past week in the Senate to be slightly more employer-friendly (more affirmative defenses) and to include more bona fide business reasons for wage disparities. Some business groups are now even supporting the legislation. At the very least, it’s a more palatable bill than the one that passed the House.

BOLI Overtime Fix: SB 984 fixes BOLI’s bad interpretation on daily/weekly overtime pay and passed the Senate unanimously. It’s a good bill, but the unions may negotiate a heavy price for this bill in the House including a hard cap on hours that an employee may work at 60/hours per week. OSCC believes this could have a severely damaging effect on food producers. OSCC is expecting a new bill to be introduced in the House this week to encompass all the elements. OSCC will be seeking member feedback.

Union Organizing & Sick Leave Penalties: HB 2856 OSCC is working to kill a nasty little bill, which creates a Community Outreach and Labor Education Program within BOLI to promote awareness of employee rights. The bill takes $2 million of employer-paid money (Wage Security Fund) to establish the program. If that weren’t bad enough, the bill also adds punitive damages to Oregon’s mandatory paid sick leave law. OSCC is actively working to oppose this bill in the Ways & Means Committee.

Environmental Regulation:
Cleaner Air Oregon: HB 2269 This big bill would increase Title V and ACDP fees to fund the new DEQ ‘Cleaner Air Oregon’ regulatory scheme. This will likely be the big environmental fight of the session. If the ‘Cleaner Air Oregon’ regulations are allowed to go forward, it will put many manufacturers out of compliance and may prove very costly for local business communities. OSCC will keep members apprised. OSCC testified in opposition to HB 2269 last week in the Ways & Means Natural Resources subcommittee.

Liability Costs / Damage Awards: SB 737, which would eliminate the $500k cap on non-economic damages in civil lawsuits (product liability, negligence, personal injury, etc.), is the trial lawyer’s top priority for 2017. We defeated it on the Senate floor earlier this month, but the bill was sent back to the Senate Rules committee, where we expect it will continue to get attention until the final gavel drops. This is a key business bill and OSCC will be paying close attention to it until the end.

Business Taxes: OSCC is actively engaged in the business tax reform discussion with Senator Mark Hass. There are several competing proposals to reform business taxes, all of which contemplate a new Gross Receipts Tax (GRT).

Senator Hass is contemplating a GRT at about 0.48% for all businesses with more than $1 million in Oregon sales. He has explicitly stated he will not entertain Speaker Kotek’s and House Democratic Leadership’s proposal of 0.95%.

OSCC wants to emphasize that these discussions are extremely fluid and there is nothing set in stone. Any GRT proposal at this stage would be predicated on budget cuts/government efficiencies that are not materializing at this point.

Small Business Tax Cut: OSCC is particularly concerned about SB 164, which limits the 2013 small business tax cut to just a few traded sector industries. Even worse, the amendments we’ve seen says that a business must have at least 10 employees to receive the tax cut. OSCC testified in opposition to the changes in SB 164 that are aimed at reducing the ability for small business to claim the reduced tax rates. OSCC believes the small business tax cut should be expanded to include sole proprietors and not limited to larger-sized small businesses.

Tax Disclosure: HB 2019 is very troubling for OSCC. It would require any business that claims $1,000 or more in state tax credits to disclose certain tax information such as Oregon sales, Oregon taxable income, and Oregon tax liability. OSCC is very concerned about a state policy that publicizes confidential tax information and gives activists a platform to politicize corporate tax returns.

Government Cost Savings: PERS reform, health care cost savings, state hiring freezes, etc. Proposals and ideas are being tossed around loosely but there has been absolutely no concrete policy development or leadership around any of these ideas. This is important because business has made a point of saying that there will be no entertainment of revenue increases unless there are concrete proposals to reduce the state government cost structure. Stay tuned here. The substance behind any of these ‘cost containment’ proposals will ultimately be the key to how the budget gets balanced.

Transportation: A 10-year, $10 billion transportation package was unveiled for the first time last week. The proposal relies on gas taxes, registration fees, and payroll taxes to add more capacity to I-5 and I-205 and other major projects. Now that a straw man proposal has been released, the discussions start in earnest. OSCC will keep members apprised, but the $1 billion per year in added taxes will be a very heavy lift.

Best regards,

Alison Hart
Executive Director

JL Wilson
Legislative Counsel

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