•    

    2019

    OSCC 2019 Legislative Report 7.16.19
    (click to download)

    2019 Legislative Report - Week 22
    Dear OSCC members and colleagues -
     
    What's Happening (OSCC Political Observations)
     

    Senate Republicans have left the state in a showdown over HB 2020, the 'Cap-and-Trade' legislation that OSCC has strongly opposed.By leaving the state, the Senate Republicans are denying quorum, which means that the Senate cannot conduct business.

     

    The Senate can only conduct business with 20 senators present.There are currently 18 Senate Democrats - not enough to conduct business on their own.

     

    The departure of the 11 current Senate Republicans (the late Senator Jackie Winter's seat won't be appointed until today) means that a host of policy bills (over 200) and budget bills (nearly 40) will die at 12:00 AM on Monday morning, 
    July 1st if the Republican senators don't return.
    It is very likely that at least one special session will need to be called to finish up the work on the budget. The legislature has already passed a 'Continuing Resolution' to fund state government until September, so the urgency will likely not set in until late summer.
    As of today, our feeling is that the Republican senators will not return until the very end (so as to focus only on budget bills) if they return at all.

     

    • Cap-and-Trade (HB 2020) This is the focal point of the Senate Republican walkout, as they are waging their political futures on killing this bill.  As of now, it is a pass/fail scenario.  The bill will either pass as is or fail as is.  There will not be amendments other than a potential amendment to refer HB 2020 to the voters.  The amendments being pushed by the business community are no longer in play, as both the Republican and Democrat base would likely see them as a "sell out" to business interests. 

      This bill will die at 12:00 AM July 1 if Senate Republicans do not return.
       
    • Paid Family Leave (HB 2005) OSCC is opposing this legislation due to decisive and overwhelming member feedback that their local business communities are bending under the weight of recently passed employment regulations and taxes.  There is also widespread feeling that HB 2005, if passed, will only grow more costly as leave rights are expanded over time and current cost constraints prove ineffective.  Although it passed the House, this bill will die at 12:00 AM July 1 if Senate Republicans do not return.
    • Business tax implementation (HB 2164) This is a bill makes several significant adjustments to the just-passed Commercial Activity Tax (HB 3427) as well as authorizes over $70 million in tax credits.  This bill will die at 12:00 AM July 1 if Senate Republicans do not return.
    • Diesel engine regulations (HB 2007) As highlighted in last week's OSCC update, negotiations produced a bill that industry could live with. This bill will die at 12:00 AM July 1 if Senate Republicans do not return. 
    Other notable bills/budgets that are in limbo
    • Campaign finance bills (HB 2716, HB 2983)
    • Community College budget (HB 5024)
    • Multi-family housing in residential areas zoned for single family (HB 2001)
    • Tobacco tax referral (HB 2270)
    • OSCC-supported Equal Pay fixes (SB 123)
    • New assessment on wireless carriers to fund Broadband Fund (HB 2173)
    • K-12 budget (HB 5015)
    • "Christmas Tree" bonding bills (HB 5005, HB 5006)
    Action Alert
     
    In an effort to protect rural Oregon, local businesses, and families across Oregon from the staggering costs of cap-and-trade, Senate Republicans left the state, effectively denying quorum in the Senate. This unprecedented action was the last option the Senators had to represent their districts and voters.
     
    Grassroots groups around the state have mobilized to support senators as they stand for their communities. The website standwithoursenators.com has been created around this effort. 
     
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
     
    Support Our Senators' Courageous Stand 
    on Cap-and-Trade (HB 2020)
    Dear OSCC members and colleagues -
     
    In a last-ditch effort to defend their local communities from the devastating impacts of the cap-and-trade bill (and with just 10 days left in the 2019 session), the Senate Republican caucus has left the state.  Cap-and-trade cannot pass if Senate Republicans continue to deny quorum in the Senate.  
     
    They took this step to protect rural Oregon, local businesses, and families across Oregon from the staggering costs of cap-and-trade.  This unprecedented action was the last option the Senators had to represent their districts and voters.  They're doing this for us.  They need our support.
     
    The next 9 days will be tense as public pressure mounts.  The state police have been dispatched by Governor Brown to bring them back to Salem, and Senate President Peter Courtney announced yesterday that each of our courageous senators will be fined $500 each day they deny passage of cap-and-trade. Third party environmental special interest groups have also launched an attack campaign in an effort force them back to Salem to pass cap-and-trade.
     
    We need your help!
     
    Grassroots groups around the state are mobilizing to support our senators as they take a stand for their communities!  A fundraising website is already in the works to help the 11 Senate Republicans pay the fines that senate leadership are levying on them EACH DAY!  We will share a link to the page when it goes live.  
     
    In the meantime, OSCC members are asked to spread the word and share your support for the senators for taking this courageous action.  It's not easy to take a stand, but we appreciate their desire to protect local business communities and families from the damaging impacts of cap-and-trade.
     
    What can you do right now?  Please share this link with your members, and ask them to send a 'thank you' note to our 11 senators.  Pressure is mounting! 
     
    OSCC will be in touch later today to share a grassroots landing page and fundraising link.  We need to engage consistently through June 30 and share our support for our senators!
     
    Tools:
    Why I'm Supporting the Walk Out #Oregon11 #DefeatHB2020
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
     
    2019 Legislative Report - Week 21
    Dear OSCC members and colleagues -
     
    What's Happening (OSCC Political Observations)
     
    There are only a handful of major business issues left in the 2019 session. All of the remaining business issues are still shrouded in some doubt and uncertainty in the final days.
     
    We are anticipating that the legislature is on track for adjournment mid-next week. The legislature must adjourn by June 30.
     
     
    What's left in 2019?
    • Cap-and-Trade (HB 2020) Cap-and-Trade will pass the House presumably today (you can see the OSCC floor letter here). Officially, it is being scored as a $1.3 billion cost increase (tax increase) that will increase costs directly on local manufacturers and increase costs on everyday Oregonians with natural gas increases and a 21 cent per gallon increase in gasoline prices.

      As of now, the bill will clearly pass the Oregon House. The intrigue will be in the Senate. There are enough sober-minded Senators who are very concerned about the cost impacts on their businesses and regressive price impacts on constituents. The fate of cap-and-trade in the Oregon Senate is still uncertain.

      As of today, business groups (including OSCC) are supporting another set of amendments that will allow a cap-and-trade system to move forward but will mitigate the extreme cost impacts and allow Oregon companies to remain competitive. These are known as the -117 amendments.

      The bottom line is that business will not get consideration of its -117 amendments until we demonstrate we can defeat the current cap-and-trade bill on the Senate floor. That is our challenge. Please use our ACTION ALERT today to tell your Senator to Vote NO on HB 2020.
     
    • Paid Family Leave (HB 2005) Paid family and medical leave has dominated the workforce conversation this session and is now coming to fruition. The bill is now being supported by a host of business organizations.

      The bill is modeled loosely on Washington state's paid family leave law and includes: 
    • 12-weeks paid family and medical leave annually
    • All employees are eligible after they've earned $1,000
    • State-run insurance program, administered by a TPA, and funded through payroll tax contributions
      • Premium collection begins in 2022
      • Employees can begin to take leave in 2023
    • Maximum payroll tax of up to 1%:
      • 60% employee paid
      • 40% employer paid
    • Employers with 25 or fewer employees are not required to pay the premium
    • All employees are required to pay regardless of business size
    • Job protection requirements come into effect after 90 days of employment
    OSCC members have had in-depth discussions on this legislation. Although OSCC is aware that this is potentially the most employer-friendly proposal likely to emerge, and OSCC is also aware that this proposal is likely more favorable to any potential ballot measure, OSCC will oppose the legislation.

    OSCC is opposing the legislation due to decisive and overwhelming member feedback that their local business communities are bending under the weight of recently passed employment regulations and taxes. There is also widespread feeling that HB 2005, if passed, will only grow more costly as leave rights are expanded over time and current cost constraints prove ineffective.
     
    • Business tax implementation (HB 2164). This is a bill to watch, because it could produce significant tweaks to the just-passed Commercial Activity Tax. Several proposed amendments to the bill have already produced eye-popping changes like exemptions for major corporate investments and lowering the threshold for applying the tax. OSCC will be watching this legislation closely as it receives consideration in the final week. 
    • Diesel engine regulations (HB 2007Negotiations are still ongoing for this on-road diesel engine retrofit and replacement bill. If new amendments get traction, the bill is likely to move next week. The current version of the bill: 
    • Phases out 2007 and older on-road diesel engines by 2029.
    • Limits the phase-out and diesel retrofit requirement for on-road diesel engines to the tri-county (Metro) area.
    • Exempts:
      • F-Plates, farm tractors, and implements of husbandry
      • Log trucks
      • Low use of 5,000 miles or fewer in a year
      • Motor homes
     
    ACTION ALERT
     
    HB 2020 is scheduled for a House vote on Monday! It's important that legislators continue to hear from local businesses about the real concerns with HB 2020 -specifically fuel, natural gas, and propane cost increases. 
     
    The revenue impact statement was posted to the Legislature's website, which laid out the impact of the bill on Oregonians, stating:
    • The bill would raise $1.3 billion when it takes effect in the 2021.
    • An immediate 22 cents a gallon increase at the pump in 2021, increasing to $3 a gallon by 2050.
    • The new 54-employee bureaucracy required to implement the bill would cost about $23 million in the coming two-year budget cycle, with potentially significant increases in the future. 
    You can read the full article in The Oregonian here.  

    While we support efforts to ensure that our state remains a national leader in addressing climate change, HB 2020 poses a serious threat to Oregon businesses and would significantly increase the cost of living for everyday Oregonians. To put it simply, HB 2020 is just not ready for prime time.

    Tell your legislator that this damaging bill will hurt everyday Oregonians and local business. Vote NO on HB 2020.
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
    2019 Legislative Report - Week 20
    Dear OSCC members and colleagues -
     
     
    What's Happening (OSCC Political Observations)
     
    The 2019 legislative session must adjourn by June 30. Tensions are high as legislators make a last push to pass priority bills before the Constitutional end of session. A number of large policy priorities remain-diesel, cap-and-trade, paid family leave -and the next three weeks will be chaotic as they work to get the votes on remaining bills.
     
    Activity on Major Issues 
    • Cap-and-Trade (HB 2020). On Tuesday, Representative Christine Drazan (R-Canby) released a memo from legislative counsel that questioned whether or not HB 2020 is actually a bill for raising revenue, requiring a 3/5 vote. The memo indicated that HB 2020 likely violates Article 8 of the state Constitution, which states that any taxes levied on the sale, distribution or use of natural gas must be dedicated to the Common School Fund. The memo went further to explain that taxes on natural gas are likely capped at 6% in the state Constitution.

      On Wednesday evening, the Ways & Means Subcommittee on Natural Resources held a special evening work session to pass out the cap-and-trade bill, HB 2020. After two hours of public testimony and debate, the committee passed HB 2020 on a party line vote with all republicans voting 'NO.' Republican committee members supported amendments to remove the emergency clause (and allow Oregonians to vote the bill up or down), but the amendment was rejected.

      At the same hearing, legislators passed  SB 1051 (introduced by Sen. Lee Beyer), which refunds any cost increases due to cap-and-trade for off-road fuels used in agriculture. Sen. Beyer's bill is an effort to mitigate some of the fuel price increases that farmers will face under HB 2020 - now estimated at $0.22 per gallon in 2021.

      Even though HB 2020 passed out of the subcommittee on Wednesday,  passage of the bill is not a done deal. Early projections indicate that HB 2020 would raise $1.3 billion in new taxes in 2021-2023, and approximately 75% of the impact is borne by the transportation sector. A broad coalition of business representatives - including OSCC - has been working hard on a solution that protects businesses and ratepayers as well as the transportation sector. These efforts (-102 amendment) would protect local businesses and consumers from the negative impacts of cap-and-trade and give the Legislature time to sort out numerous constitutional challenges before cap-and-trade is fully implemented. The amendments are just now getting traction, but this bill is being fast-tracked. Now is the time to weigh in on the more damaging components of the bill and ask instead that the legislature adopt the -102 amendment.
    • Diesel (HB 2007).  Negotiations are still in the works on HB 2007, the on-road diesel engine retrofit and replacement bill. If new amendments get traction, the bill is likely to move next week. The current version of the bill:
       
      • Limits the phase-out and diesel retrofit requirement for on-road diesel engines to the tri-county (Metro) area which includes Clackamas County, Washington County, and Multnomah County.
      • Exempts:
        • F-Plates, farm tractors, and implements of husbandry
        • Log trucks
        • Low use of 5,000 miles or fewer in a year
        • Motor homes
    • Commercial Activity Tax - Technical Fixes (HB 3427). Senate Revenue Chair Mark Hass has been working on technical fixes to HB 3427, the commercial activity tax, which is a $2.8 billion tax increase on Oregon businesses with sales over $1 million. HB 2164 (the technical fix bill) and specifically the -1 amendments made several improvements to the bill, particularly for the insurance industry.However, the amendment also contained a not-so-subtle carve-out of the new gross receipts tax for a major Intel project (see Sections 7-13).
    • Community College Funding (HB 5024). The Higher Education Coordinating Commission budget appears to have approximately $645 million allocated to Oregon's 17 community colleges. While this is a $50 million increase over current service levels, it is far short of the $647 million base budget plus $140 million to expand CTE and Student Success programs.
    • Paid Family Leave (HB 2005). Paid family and medical leave has dominated the workforce conversation this session. On Friday, Oregon Business and Industry entered into final negotiations with House leadership to pass HB 2005 this session and forestall a ballot measure. The draft policy under consideration is modeled loosely on Washington and includes:
    • 12-weeks paid family and medical leave annually
    • All employees are eligible after they've earned $1000
    • State-run insurance program, funded through payroll tax contributions
      • Premium collection begins in 2022
      • Employees can begin to take leave in 2023
    • Payroll tax of up to 1%:
      • 60% employee paid
      • 40% employer paid
    • Employers with 25 or fewer employees are not required to pay the premium
    • Job protection requirements come into effect after 90 days of employment
    We anticipate the release of a final amendment by the end of the day on June 10 and will share to get local chamber feedback. We could see this bill move out of the House Rules Committee as early as June 11 if the amendment is written correctly and without technical errors.
     
     
    What happened last week? 
    • Lawsuit Damages (HB 2014). In a very rare occurrence, OSCC helped defeat HB 2014 on the Senate floor last week when the bill only received 14 votes (16 votes are needed for passage). HB 2014 would have repealed Oregon's legal limit of $500,000 on non-economic damages in personal injury and negligence lawsuit claims. OSCC, health care groups, and business organizations opposed this legislation because it is a significant factor in driving up health care costs and general liability costs for employers.
      
    ACTION ALERT
     
    Cap and Trade HB 2020: We still have one last chance  - in the full Ways & Means Committee - to pass the -102 amendments that will dramatically improve the legislation by removing the major cost impacts on businesses and consumers.
     
    The revenue impact statement was posted to the Legislature's website last week, which laid out the impact of the bill on Oregonians, stating:
     
    • The bill would raise $1.3 billion when it takes effect in the 2021.
    • An immediate 22 cents a gallon increase at the pump in 2021, increasing to $3 a gallon by 2050.
    • The new 54-employee bureaucracy required to implement the bill would cost about $23 million in the coming two-year budget cycle, with potentially significant increases in the future.
     
    Tell your legislator that we need to pass the -102 amendments. If we don't pass the amendments, we simply need legislators to vote NO on HB 2020.
     
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
    Massive cap and trade bill hurts Oregonians
     - NO on HB 2020
    Dear OSCC members and colleagues -
    HB 2020 is scheduled for a work session and possible vote by the full Ways and Means Committee tomorrow. 
     
    The revenue impact statement was posted to the Legislature's website Wednesday, which laid out the impact of the bill on Oregonians, stating:
    • The bill would raise $1.3 billion when it takes effect in the 2021.
       
    • An immediate 22 cents a gallon increase at the pump in 2021, increasing to $3 a gallon by 2050.
       
    • The new 54-employee bureaucracy required to implement the bill would cost about $23 million in the coming two-year budget cycle, with potentially significant increases in the future.
    You can read the full article in The Oregonian here.   
    We still have one last chance on Friday - in the full Ways & Means Committee - to pass the -102 amendments that will dramatically improve the legislation by removing the major cost impacts on businesses and consumers.
     
    Tell your legislator that we need to pass the -102 amendments. If we don't pass the amendments, we simply need legislators to vote NO on HB 2020.
     
     
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
    2019 Legislative Report - Week 17
    Dear OSCC members and colleagues -
     
     
    What's Happening (OSCC Political Observations)
     
    This is the final week for policy committees to pass bills. Any bill not passed out of a policy committee (other than Rules or Revenue) is dead after Friday.
     
    All legislation passed after Friday will have to come from either Rules, Revenue, or Ways & Means. This signals that the 2019 legislature is in the homestretch. It also signals that the decision-making will really come down to just a handful of legislators. Most legislators will have little or nothing to do from this point forward other than casting votes on the floor.
     
    Democrat leadership can pass any bill it wants. The only reason there would need to be any negotiation whatsoever going forward is because:
    1. Republicans are still employing delay tactics which could be very impactful as the June 30th constitutional end date draws closer.
       
    2. Republicans have complete leverage on a key Measure 11 'reform' bill sought by Democrats as Democrats do not have the votes to pass SB 1008 on their own.
       
    3. Republicans have some leverage on PERS reform as it is unlikely that Democrats can produce all the votes needed to pass SB 1049 on their own.
       
    4. Republicans have complete leverage on the "kicker" issue as Democrat leadership is seeking to be able to spend some of the $1.4 billion personal kicker. 
    Activity on Major Issues
    • The $2.8 billion Commercial Activity Tax (HB 3427) was signed into law by Governor Brown. Starting on January 1, 2020, all businesses doing business in Oregon will see: 
       
      • A gross receipts tax rate of 0.57% on Oregon sales over $1 million;
         
      • A 35% deduction from taxable sales for labor OR business inputs, whichever is higher;
         
      • An exemption for groceries (defined as those that qualify for 'SNAP') and transportation fuel. 
    • Cap-and-Trade (HB 2020). On Friday, HB 2020-A passed its first major milestone. After three hours of debate, the Joint Committee on Carbon Reduction adopted the -94 amendments on a party line vote and sent the bill to the Joint Committee on Ways & Means for further deliberation. Democrats voted down all other amendments that were brought forward, although it was widely acknowledged that rural Oregon would suffer job loss and economic hardship under the bill. 

      The OSCC position has not changed since Day 1, primarily because the basic precepts of the legislation have not changed despite amendments that changed the bill on the margins. Transportation costs will increase. Natural gas costs will increase. Propane costs will increase. Local food processors and manufacturers will face a real competitive disadvantage. Small businesses and households will see increases in transportation and energy costs.

      OSCC still believes there are still opportunities to change this bill in the Ways & Means Committee. 
     
    What happened last week?
    • The state revenue forecast added $770 million to state coffers for the upcoming 2019-2021 biennium. Just from the last forecast in March, every metric grew by eye-popping numbers due to a historic influx of revenue over the tax season.

      In addition to the influx of $770 million into the upcoming budget cycle, the kicker almost doubled in size.  It's now projected at $1.4 billion. Net reserve funds are now nearly $3.5 billion.

      But the real impact of the historic revenue forecast is that it will tamp down on talk of additional tax revenue for the remainder of the 2019 legislative session. 
    • The legislature's attempt at PERS reform was unveiled with Senate Bill 1049SB 1049 contains the following provisions: 
       
      • Tier 1 and Tier 2 members, who are public employees who entered the PERS system before 2004, would have 2.5% of their salaries diverted from their individual retirement accounts into paying off the system's debt.
         
      • Workers hired 2004 or later (PERS Tier 3 and Tier 4), would face a lower diversion - 0.75% of their salaries.
         
      • Public employees earning less than $30,000 a year would be exempted.
         
      • A reduction in assumed interest rate for retirees who use the "money match" method of calculating their pension benefits.
         
      • Most significantly, legislators seem to have abandoned efforts to raid SAIF to cover PERS liability, which is a good development for Oregon employers.  
    The future of SB 1049 is uncertain. Although it is only a modest cost-saving measure, the unions oppose it in force and it is unlikely that majority Democrats can carry the issue themselves.
     
    • Equal Pay Technical Fixes (SB 123-A). On Tuesday, the Oregon Senate passed SB 123 unanimously. The bill includes several important technical fixes to give employers clarity in implementing Oregon's Equal Pay Act. Oregon's law is the most comprehensive in the country, and it has been difficult for many employers - large, small, and seasonal - to implement. OSCC supports these fixes, which streamline implementation and provide important protections to employers who are trying to do the right thing. We anticipate rulemaking later this year to address several other issues identified by Sen. Kathleen Taylor and Sen. Tim Knopp.
     
    Other key issues coming up this week.
    • Prevailing wages in enterprise zones (HB 2408). We are expecting the Senate Workforce Committee to take up HB 2408 this week. In its current form, the bill requires prevailing wages to be paid on private enterprise zone projects of $20 million or more. OSCC is actively opposing and lobbying the legislation. 
    • Lawsuit Damages (HB 2014). We are expecting the Senate Judiciary Committee to vote on HB 2014 this week. HB 2014 would repeal Oregon's legal limit of $500,000 on non-economic damages in personal injury and negligence lawsuit claims. OSCC, health care groups, and business organizations are opposing this legislation because it is a significant factor in driving up health care costs and general liability costs for employers. Although we expect the Senate Judiciary Committee to approve the bill on a party line vote, we believe we have an opportunity to defeat the bill on the Senate floor.
     
    ACTION ALERT
     
    HB 2020: Cap-and-trade will increase the cost of living and working in Oregon - all residents will bear the cost of fuel increases and increased natural gas rates. It's projected to immediately drive up the cost of gas by $0.16 per gallon, and natural gas customers will face double digit rate increase in the first year of the program!  

    There are fewer than 45-days before session adjourns, and NOW is the time to make your voice heard.
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182

     

    2019 Legislative Report - Week 16
    Dear OSCC members and colleagues -
     
     
    What's Happening (OSCC Political Observations)
     
    House and Senate Republicans ground the session to a crawl last week as both caucuses employed tactics designed to slow the pace of the session. Senate Republicans simply did not come to the capitol and effectively denied the necessary quorum to conduct Senate business.
     
    Senate Republicans continue to negotiate with Senate President Peter Courtney on a slew of bills and a "go home" package. They hope to be able to come to agreement by Monday.
     
    The result was an atypical slow legislative week in what would have otherwise been an intense week of jockeying as major deadlines loom. May 10th was the deadline for all policy bills to be posted for a work session in order to move forward. By May 24th, all bills must have been voted out of their second chamber policy committee in order to survive. Bills in Rules, Revenue, or Ways & Means will remain 'in play' through the end of session, although many of those committees will be wrapping up their work by mid-June.  
     
     
    Activity on Major Issues
    • The $2 billion Commercial Activity Tax (HB 3427) was most impacted by the work stoppage last week in the Senate. What was slated for an expedited Senate vote last Tuesday is still on hold. 
    HB 3427 includes the following components: 
      • Gross receipts tax rate of 0.57% on top line sales over $1 million;
         
      • A 35% subtraction from receipts for labor OR the cost of goods sold (COGS), whichever is higher; and
         
      • An exemption for groceries (defined as those that qualify for 'SNAP' sold at retail). 
    Senate Republicans are trying to force the bill back to committee to lower the tax rate and/or increase the $1 million exemption. It is unclear whether they will be successful. 
     
    • PERS Reform finally made an appearance (SB 1049). On Friday afternoon, Speaker Kotek and Senate President Courtney unveiled their plan to tackle PERS costs. Under their plan: 
       
      • Tier 1 and Tier 2 members, who are public employees who entered the PERS system before 2004, would have 2.5% of their salaries diverted from their individual retirement accounts into paying off the system's debt.
         
      • Workers hired 2004 or later (PERS Tier 3 and Tier 4), would face a lower diversion - 0.75% of their salaries.
         
      • Public employees earning less than $30,000 a year would be exempted.
         
      • A reduction in assumed interest rate for retirees who use the "money match" method of calculating their pension benefits.
         
      • Most significantly, legislators seem to have abandoned efforts to raid SAIF to cover PERS liability, which is a good development for Oregon employers. 
         
    • Cap-and-Trade (HB 2020Legislators unveiled the latest version of the carbon pricing bill in the -84 amendments last week. The amendments made a handful of changes, but failed to address some of the bigger affecting the business community such as the huge cost pressures associated natural gas and transportation fuel.
    The new version of the bill contains the following:
    • Natural gas utilities receive 60% free allowances in 2021 that decline in 2022 in contrast to 100% for investor-owned electric utilities. Similar to California, these allowances are consigned, which limits how the utility can use them. That means many ratepayers-particularly industrial and commercial facilities-will see rate increases beginning in 2021.  This was not a win for local business communities.
       
    • Trade-exposed manufacturers and processors are assigned a benchmark of free allowances based on the best available technology.  This is an attempt to keep some of the state's bigger job-providers from moving out-of-state.
       
    • Transportation fuels will bear the brunt of the cost increases in the early years of the cap-and-trade program.  A tax refund may be available for off-road fuels used in forestry and agriculture, but it is subject to a study of legal challenges.
       
    •  Assistance may be available to low income Oregonians to help cover cost increases for automobile fuels, propane, and home heating oil. 

    There is still a lot of work to be done, because as written, the -84 amendments will still result in a competitive disadvantage for local Oregon businesses. Our sources tell us that legislators plan to adopt the -84 amendment on Friday this week and pass the bill to Ways & Means. We will keep you updated as the process unfolds or as opportunities to weigh in come up.
     

    • Diesel Regulations (HB 2007Negotiations have been ongoing on HB 2007, the on-road diesel engine retrofit and replacement bill. The bill is scheduled for a public hearing and work session early next week with an amendmentthat is expected to: 
       
      • Scale down the phase-out and diesel retrofit requirement for on-road diesel engines to the tri-county (Metro) area which includes Clackamas County, Washington County, and Multnomah County.
         
      • By 2029, all heavy duty diesel trucks must have a 2007 or newer engine. Also by 2029, all medium duty diesel trucks must have a 2010 engine or newer. Farm vehicles and motor homes will be exempted. 
         
    • Paid Family Leave (HB 2005Paid family leave has dominated the labor conversation this session. HB 2005 is the last remaining paid family leave bill, and it currently sits in the House Rules Committee. Labor unions have threatened a ballot measure in 2020 if HB 2005 fails to pass. However, a draft policy is currently in the works to forestall a ballot measure, including the below components (modeled loosely on Washington): 
    • 12-weeks paid family and medical leave annually
       
    • All employees are eligible after they've earned $1,000
       
    • State-run insurance program, funded through payroll tax contributions
       
    • Payroll tax of up to 1% (60% employee paid, 40% employer paid)
       
    • Employers with 25 or fewer employees are not required to pay the premium
       
    • Job protection requirements come into effect after 90 days of employment 
       
    • Marijuana Accommodation (SB 379In a bit of good news, SB 379 is officially dead. This bill would have undermined and nullified all employers' workplace drug-free policies and would have required employers to accommodate off-duty marijuana use. Although the Senate Judiciary Committee passed the bill on a party-line vote, Senate President Courtney refused to let it come to the Senate floor when it was clear that OSCC and other secured enough votes to defeat the bill.
    Best regards,
     
    JL Wilson & Jenny Dresler
    Legislative Counsel
    503-363-2182
    Oregon State Chamber of Commerce
    503-363-2182 
    867 Liberty Street NE, Salem 97301