The most significant issue of the past week was the final passage of the ‘American Rescue Plan’ federal aid package that will send over $2.6 billion to the Oregon legislature to fill budget holes.
With all this money coming to the state, OSCC sounded the alarm that the Oregon Legislature is still looking to raise taxes on small businesses and working Oregonians.
OSCC sounded the alarm on the following taxes:
- SB 137 – Disconnect from Federal CARES Act tax benefits for Oregon businesses
- SB 139 - Repeal of the Oregon Small Business Tax Cut
- HB 2253- Taxing PPP loans
- HB 2839 – Disconnect from Federal CARES Act tax benefits for Oregon businesses
OSCC also called attention to important tax relief legislation:
- SB 842 – Eliminates state taxes on federal stimulus checks
Finally, OSCC is looking to Friday, March 19th with a high degree of anticipation, as it is the first major deadline of the 2021 legislative session. All bills not scheduled for a work session by the end of Friday are considered ‘dead’.
Activity on Major Issues
Budget Re-balance. This week, the Legislature will begin work on balancing the budget for the current 2019-2021 biennium that ends on June 30th. This particular “re-balance” will take on a much different flavor this year because the state has so much more money to spend due to a huge influx of tax revenue in the last months of the biennium. The primary proposal here will be an additional $250 million for “summer school” learning programs designed to help students catch up after being out of school for a year.
Clean Energy. This week, the House Committee on Energy and Environment is unveiling what is sure to be one of the most controversial policies considered this session: 100% clean energy. On Monday, we will learn what proposal legislators intend to introduce as a gut and stuff amendment to HB 2021, including which ratepayers will be impacted. The Committee will then host a public hearing on the yet-to-be-introduced -1 amendment to HB 2021 on Wednesday at 1:00pm. As OSCC has made clear, this bill is the next step in a process to rid Oregon of any fossil fuels, including natural gas and diesel.
Taxes. SB 727 could actually be a good bill for Oregon small businesses, as it is being crafted to address changes passed by Congress in 2017 which placed a $10,000 federal cap on “SALT” (state and local tax) deductions. But late last year, the IRS published guidelines on how states could “work around” this $10,000 deduction limit, and states like New Jersey and Connecticut have already passed legislation to implement this guidance. We anticipate an amendment early this week to effectively lift the $10,000 cap on the federal deduction of state and local taxes. This change in state law could result in significant federal tax savings for LLCs and S-Corps that would not cost the state anything. OSCC will be watching the unveiling of this proposal on Wednesday at 1:00pm in the Senate Committee on Finance and Revenue.
What’s Coming Up?
There are a number of important bills coming this week with direct impacts on our local business communities:
- HB 3065 will host a highly anticipated amendment that would authorize tolling on highways to fund road construction project. Joint Transportation Committee, Tuesday, 8:00 AM.
- SB 483 is a bad bill that creates a presumption of retaliation for any adverse action taken against an employee within 60 days of that employee engaging in any sort of protected “whistleblower” activity related to workplace safety. Senate Judiciary Committee, Tuesday, 8:00 AM.
- HB 2474 is a major expansion of the state family leave law to require that family leave provisions apply to all businesses as small as one employee. Expands leave to include the closure of school or daycare as a qualifying leave. House Early Childhood Committee, Monday, 1:00 PM.
- HB 2205 – the PAGA bill - is back for more consideration. OSCC OPPOSES this bill. The House Judiciary Committee will consider an amendment to more closely align the bill with California’s existing law which applies to violations of labor law. House Judiciary Committee, Thursday, 1:00 PM.
