Agricultural Overtime, Omnibus Tax Bills Advance

Date: February 26, 2022

Could this be the year a ban on cashless point-of-sale systems passes?

State Director Anthony Smith reports from Salem on the small-business agenda for the legislative week ending February 25

It’s Day 25 of the 2022 Oregon Legislative Session and that means there is just over one week left until the Legislature is constitutionally required to adjourn sine die (on or before Monday, March 7, 2022).

More news came out this week from the Oregon Health Authority – Oregon’s indoor mask mandate is now scheduled to end on March 19, 2022. Gov. Kate Brown also announced that the pandemic-related state of emergency she first declared in March 2020 will officially end on April 1, 2022.

UPDATE FOR THIS NEWSLETTER–On February 28, Governor Brown announced, “In Oregon, the Oregon Health Authority rules requiring masks in indoor public places and schools will be lifted after 11:59 p.m. on March 11. Other state and federal requirements, such as those for health care settings, public transit, and other specialized settings, will remain in place for a period of time.”

On to the Legislative update – here’s what’s been going on, and what’s on deck:

Agricultural Overtime

After passing HB 4002 out of the House Business and Labor Committee on a party line vote and sending it to the House Revenue Committee, the Oregon Legislature decided to create a new Joint Committee on Farm Worker Overtime with the sole purpose of working on this bill. In just a matter of hours, the committee was formed, held a public hearing, and then adopted an amendment that had been drafted before the public was even allowed to provide testimony.

The bill passed out of the committee, again, on a party line vote, and now heads to the House floor. A vote is imminent, but it’s not too late to Take Action and tell Oregon legislators to vote no. As with previous versions, the bill moves Oregon to a rigid, 40-hour per week threshold for ag overtime and relies on tax credits to partially offset these new costs for farmers and ranchers. These tax credits won’t work in the long run because when (not if) they go away, farmers and ranchers will be left without resources necessary to maintain their operations. This is not a workable solution to keep Oregon’s ag industry viable. For more information on the bill, you can click here to view NFIB’s testimony. (Please note that the testimony references the -A7 amendments, but the committee adopted the -A12 amendments, which are not substantially different from the -A7’s.)

UPDATE FOR THIS NEWSLETTER–The House passed HB 4002 on February 28. It is now in the State Senate.

Omnibus Tax Bill

SB 1524 has finally moved out of the Senate Finance and Revenue Committee on a unanimous vote and will likely hit the Senate Floor on February 28. The clock is definitely ticking to get this bill across the finish line, and as long as the House Committee on Revenue moves quickly (and doesn’t get too tricky with new amendments) the bill should be able to pass in both chambers before sine die.

You’ll recall from the last update that SB 1524 is the 2022 omnibus tax bill – containing miscellaneous updates to Oregon’s tax code. Among other provisions, SB 1524 refines and clarifies the state’s Business Alternative Income Tax, a voluntary tax program that allows qualifying business owners to reduce their federal income tax liability at no cost to the state (a State and Local Tax workaround) – and instructs the Oregon Department of Revenue to adopt rules providing relief from penalties if sufficient estimated payments are made by either a pass-through entity or its members.

The bill also makes changes to Oregon’s Corporate Activity Tax which include administrative technical changes to accommodate businesses filing CAT returns using a fiscal year that differs from the calendar year and exempts sales of prescription drugs sold by local independent pharmacies with nine or fewer locations in Oregon. NFIB has expressed our appreciation for the Legislature’s willingness to reexamine and address the unintended consequences of taxing prescription drugs, albeit in a limited manner. This is the right approach to take when evaluating the costs and benefits of a new tax program and we look forward to continuing this conversation.

Ban on Cashless Point-of-Sale Systems

For several years now, the Oregon Legislature has proposed a bill that would ban cashless businesses in most circumstances. 2022 looks like the year it will finally pass. Under the state’s public accommodation laws, refusing a sale in cash (paper bills) or up to $100 in coins will be considered discrimination under SB 1565 – enforceable by the Bureau of Labor and Industries.

The bill includes a list of nearly 20 exclusions for certain businesses so that they can continue to operate on a cashless basis. These exemptions correctly acknowledge that there are legitimate business reasons why it may not be appropriate or pragmatic for a business to accept cash payments – reasons that have nothing to do with discrimination, but rather for reasons relating to efficiency, security, and overall customer experience. A late breaking amendment was adopted in the House that will exempt membership-only retail establishments where goods and services are sold to members who pay a recurring membership fee. The bill does not include a private right of action – and this new exclusion makes it relatively easy for cashless businesses to continue to operate so long as they set up a membership fee. However, the $100 in coin threshold is still very problematic. If a disgruntled customer shows up and tries to pay with a bucket of 10,000 pennies, a business won’t be able to refuse the sale without risking a discrimination case with BOLI. We’ll likely need to come back and fix this legislation in the future.

Prior Legislative Report

February 11—Proposal Instituting a Sales Tax on Certain Good Dead for the Year

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