OTA Dispatch Issue 3 2019

Oregon Trucking Associations, Inc. Oregon Truck Dispatch Waylon Buchan OTA Director of Government Affairs 18 HIGHLIGHTS 2019 Oregon Legislature OREGON TRUCKING ASSOCIATIONS, INC. EMBOLDENED BY THEIR 2018 CAMPAIGN victories, Democrats entered the 2019 legislative session with supermajorities in each chamber, with 38 Democrats in the House and 18 in the Senate. They set the stage early and pushed an ambitious agenda, much of which they perceived was long-overdue. Lawmakers opened up not just one, but multiple Pandora’s boxes when they took on vaccination policies, gun regulation, massive corporate tax increases, rent control, PERS reform, employment law, tobacco, and sprawling environmental policies. The session was also punctuated by surprising attempts to break open the Highway Trust Fund, perplexing parliamentary tactics, and two dramatic Republican walk-outs. All things considered, we did relatively well in light of the onslaught of potentially damaging legislation we faced this session. Democrats entered the session with several “flagship” items on their agenda, one of which was the passage of new taxes to support education funding. Ultimately, they did pass a corporate tax package in the form of House Bill 3427 , which creates a new 0.57% gross receipts tax on all companies with in-state revenues of $1 million or more. Fuel and groceries are exempt from the tax, and companies may deduct costs for labor or materials. The bill is expected to raise approximately $1 billion per year for Oregon schools. HB 3427 was the subject of one of this session’s two dramatic walk-outs by Senate Republicans. Tensions boiled over in early May when Republicans, displeased with their lack of involvement in policy negotiations surrounding PERS, climate policy, and education funding, left Salem for four days. This tactic effectively denied the Senate the twenty-person quorum necessary to conduct business, leaving the legislature with one functioning chamber. During the walk-out, Republican and Democrat leadership continued negotiations until they landed on a deal. Republicans returned the following Monday, and Democrats agreed to kill two high-profile bills involving gun regulation and mandatory vaccinations. The Governor signed HB 3427 into law on May 16, and the bill becomes effective in 2020. The bill was later modified by another piece of legislation ( HB 2164 ), which made technical corrections and clarifications. As an aside, the multiple-bill approach to the gross receipts tax complicates future efforts for opponents to refer the legislation to the ballot for consideration by all voters. Because the bills have different effective dates, it would potentially involve multiple high- profile and expensive referral efforts during separate elections. Recent reports indicate these referral efforts have lost momentum, and the gross receipts tax is likely here to stay. On the labor and employment front, three major issues emerged early in the session. We saw introduction of bills to make sweeping changes to Oregon independent contractor laws ( HB 2498 ), bills to expand paid family and medical leave ( HB 2005 ), and attempts to change how employers and law enforcement treat marijuana and other drugs in the workplace ( SB 379 ; SB 965 ). For years, Democrat lawmakers have been looking for ways to rework how Oregon classifies independent contractors and employees. Their motivations are a result of two causes. First, state agencies tend to treat Oregon independent contractor statutes in a somewhat schizophrenic manner. The Department of Revenue, Employment Department, Construction Contractors Board, Landscape Contractors Board, the Bureau of Labor and Industries, and the Worker’s Compensation Division do not simply apply Oregon statute when determining whether a worker is an employee or an independent contractor. Instead, they all use a variety of different criteria and tests, resulting in an indecipherable kaleidoscope of regulations coming from state agencies. Second, when lawmakers see high-profile examples of worker misclassifications, they tend