2020 Legislative Report – Week 3

[The following is an excerpt from the Oregon State Chamber of Commerce’s (OSCC) Legislative Report. Any opinions expressed or implied are those of OSCC and do not necessarily reflect those of the Springfield Chamber or its representatives.]

We are now done with the first two weeks of the 2020 session.  There are three weeks to go before the constitutional end date of March 8th. It was an extraordinarily busy week as most bills were scheduled for hearing or some sort of consideration. As of right now, most of the 250 bills that were introduced in the 2020 session are still alive. By our count, only 50 bills are formally dead.

Some good news: The quarterly revenue forecast was released on Wednesday. State revenues are expected to increase yet another $183 million. Revenues have increased an astounding $675 million since the 2019 Close-of-Session forecast which was the basis for the final 2019-2021 budget.

Now for the reality check: The 2020 session could very well come to a grinding halt this week. Democrat leadership will push Cap-and-Trade (SB 1530) out of the Ways & Means Committee on Tuesday, which means it could be on the Senate floor as soon as Thursday. At this point, we have every reason to believe that Senate Republicans will leave the capitol to deny quorum. Things could get very interesting by the end of the week as many possibilities could unfold, including (1) 11th hour dealmaking to lower the temperature and keep the session on track, although it’s hard to see how this would include Republicans providing a quorum to vote on Cap-and-Trade, (2) House Republicans may also elect to leave the capitol in a show of solidarity, and (3) the Governor exploring “emergency” powers to pass Cap-and-Trade without a quorum. 

It should also be noted that the politics of Cap-and-Trade are already baked. There is no business group or interest group that is going to alter the outcome – or negotiate a truce – except for the environmental lobby or Timber Unity. 

In the meantime, OSCC continues to be busy with its priorities. You can see the OSCC Legislative Priorities here.

Other than SB 1530, we continue to believe our biggest threat is House Bill 4010, which would effectively eliminate all state tax incentives for Opportunity Zones. The Oregon Education Association is imploring House Democrats to eliminate them. Bottom line: If you care about Opportunity Zones, Chambers need to say something! Either put your testimony on the record at lro.exhibits@oregonlegislature.gov or let your Representative and Senator know that local communities oppose this bill!  

Here’s a rundown of key OSCC Issues:

• Cap-and-Trade (SB 1530). This bill passed the Senate Environment & Natural Resources Committee on Thursday afternoon on a 3-2. Senator Arnie Roblan (D-Coos Bay), a previous opponent of the bill, is now supporting the new bill, allowing it to pass to the Ways & Means Committee. OSCC is anticipating that SB 1530 will pass the Ways & Means Committee at 11:00 am on Tuesday, setting up the pivotal conflict of the session. 
• Statewide Lodging Tax legislation (HB 4047) will make permanent the 1.8% statewide lodging tax rate that was passed in 2016. The rate was scheduled to be reduced to 1.5% this year, but in order to lock in the higher rate for statewide tourism promotion instead of other unrelated objectives, the Oregon Restaurant & Lodging Association agreed to keep the rate at 1.8% so long as the money is dedicated to tourism promotion. OSCC testified in support of this bill, but its fate is uncertain.
• Unemployment Benefits for Striking Employees (HB 4007). On Wednesday, the House Committee on Business & Labor closed the door on this bill. HB 4007 upended Oregon law by ensuring that striking employees are not disqualified from receiving unemployment. OSCC strongly opposed the bill and was pleased to see it die. 
• Real Estate Transfer Taxes (HJR 203). Other than a public hearing, we’ve seen no activity on this measure which would repeal Oregon’s ban on real estate transfer taxes. 
• Interfering with Non-Competes (SB 1527). Last week, this issue was negotiated as both business and labor landed on a 12-month enforceability for non-compete agreements. Under the new law, non-competes can now only apply to employees making more than $97,300 per year and are only effective for 12 months. OSCC considers this issue settled. 
• Eliminating Opportunity Zones (HB 4010). OSCC joined cities and other economic development proponents on Wednesday night to testify in opposition to HB 4010, which would disconnect Oregon from the federal Opportunity Zone tax incentive that included in the federal ‘Tax Cut and Jobs Act’ passed by Congress in 2017. We’ve heard from many of our local chambers about the importance of maintaining Opportunity Zones as a tool to support local economic development.  We view this as our biggest threat to date. If you want to preserve Opportunity Zones in your community, you need to speak up and send your testimony to: lro.exhibits@oregonlegislature.gov

Bill of the Week – SB 1525:

• New Requirements for projects in Economic Development Zones 
  (SB 1525). Last week, we reported that HB 4045 died in committee. OSCC opposed HB 4045, which imposed prevailing wage requirements on projects within enterprise zones, strategic investment zones, and renewable energy investment zones; specifically, the requirement to pay prevailing wages. 
  
  But now there is opportunity for mischief in SB 1525, which is a very minor consensus bill dealing with new reporting requirements for enterprise zone projects. There is a possibility that HB 4045 may get stuffed into SB 1525 in the House Business & Labor Committee. We need to make sure this does not happen! Please submit your testimony to hbl.exhibits@oregonlegislature.gov. The Committee needs to know that your chamber does not support adding HB 4045 into SB 1525! OSCC will be watching this issue closely. The public hearing for SB 1525 is Monday morning.