The Oregon Biz Report - Business News from Oregon

In the first of a series of guest editorials by Oregon lawmakers, state Representative Mike Schaufler offers some suggestions on how to get Oregon’s economy back on track. Schaufler was chairman of the Business and Labor Committee of the House of Representatives in the last session of Legislature.
By Oregon NFIB,

NFIB Guest Opinion:
Representative Mike Schaufler

Oregon is still in the deepest recession since the Great Depression. Over the past two years or so, I’ve been asked by thousands of Oregonians what state government is going to do about it. The 2009-10 Oregon Legislature took three actions that I think will help. In 2009 bills were passed:

- To upgrade Oregon’s transportation infrastructure
- Provide and make accessible health insurance to every child and tens of thousands of low-income adults
- Invest in low-income housing.

What we did not do is spend, cut or tax Oregon out of this recession. The 2011-13 Legislature will not spend, cut or tax Oregon out of this recession either. Like always, Oregon will have to work its way out of recession.

How will we do that?

Oregon needs policies that recognize and take advantage of our abundant and sustainable natural resources. We must take far greater advantage of the army of working families who know how to responsibly and sustainably manage these resources as well.

Businesses won’t be penalized if they submit withholding payment application by December 31
By Oregon Department of Revenue,

SALEM—If you’re one of 60,000 Oregon businesses that recently filed an electronic funds transfer (EFT) application with the Oregon Department of Revenue, not to worry: you won’t be penalized if your application isn’t processed by December 31.  EFT allows businesses to transfer their quarterly withholding tax electronically to the department and to the IRS instead of mailing checks. In Oregon, 40-50 percent of businesses still pay by check.

Why the fuss now? The IRS recently changed its EFT requirements. Businesses with more than $2,500 in withholding tax each quarter must now pay it electronically. Oregon will require those businesses to electronically pay state withholding starting January 1, 2011.

By Oregon Small Business Association,

Oregon foreclosures hit double digit drops in November (-13.37). The drop was slightly better than the national average, but for the year Oregon foreclosures were over 30% worse than the national average according to RealtyTrac. Additionally housing prices and housing sales dropped in the Portland Metro area according to the Regional Multiple Listing Service. Another indicator of falling home prices is the Standard & Poor’s/Case-Shiller 20-city home price index which showed Portland home prices falling 1.3 percent in October from the previous month. Home sales dropped 28.7% in November according to the Regional Multiple Listing Service. The news story from KGW News below goes into greater detail:

By Charles P. “Chuck” Jones, CFP

A bill (LC12O6) is going to be presented to the Oregon legislature early in 2011. The Oregon State Bank is the creation of the union-backed group, Oregon Working Families Party working in conjunction with Portland State University. Oregon Working Families leadership is led by Co-Chairs Jeff Anderson, Secretary-Treasurer UFCW local 555, and Barbara Dudley as Chair of the Portland chapter.

The State Bank will accept deposits of public funds to make, purchase, guarantee, or hold certain loans and to serve as custodian bank and directs the state treasurer to deposit monies in bank in amount treasury determines as necessary to allow bank to fulfill its duties. The bill directs excess income of the bank to go to the OR Rainy Day fund. The bank will be run by a board headed up by the governor, the treasurer, and the BOLI chairman. The group is promoting that it will be unbiased, since there will be an advisory board and have an independent structure . However, the advisory board is appointed by the main board, including the governor, treasurer, and BOLI chairman.

Little People Stars Sue Washington County building inspectors
By Oregon Tax News

Little People, Big World stars Amy and Matt Roloff decided to sue Washington County for $200,000 and legal costs after John Wheeler, a Washington County building services inspector, allegedly trespassed on their Hillsboro farm on July 16, 2010. The complaint holds that Amy Roloff suffered severe distress after confronting Wheeler for trespassing. The plaintiffs named Wheeler’s supervisor, Jay Winchester, a co-defendant.

A crew filming the Roloffs’ reality television series caught the encounter and broadcasted it on network television.

Wheeler contends that he acted on his supervisor’s instructions, which permitted him to enter their property without seeking permission. KPTV reports that he allegedly passed numerous “No Trespassing” signs, passed a locked gate and ignored a call box he could have used to contact the family for permission to enter the property.

Oregon Court of Appeals limits comparative fault defense in medical malpractice cases
Byby Shemia Fagan, Ater Wynne,
Oregon Law Firm,

This month, the Oregon Court of Appeals addressed the comparative fault defense in the context of medical malpractice cases in Son v. Ashland Community Healthcare Services.   Sara Burns died while under the medical care of Ashland Community Healthcare Services (“ACHS”) after she attempted suicide by overdosing on various drugs. Her mother, as personal representative of Sara’s estate, brought a wrongful death action against ACHS alleging professional negligence in its treatment of Sara. ACHS raised the comparative fault defense, alleging that Sara failed to inform ACHS of her ingestion of a particular drug that would have changed ACHS’ treatment plan and likely prevented her death. The jury returned a verdict for the plaintiff for $740,000, after which the court reduced the award by a percentage because of Sara’s comparative fault. Plaintiff appealed.

Consider it the biggest Christmas shopping purchase of the season as Google spends $2 billion to purchase a building in New York that takes up an entire block.   The building is an amazing 2.5 million square feet in Manhattan New York.  Thanks to a depressed real estate market the price per square foot was below traditional market rates.  This is the largest real estate purchase for single building in America in this year.    Happy Holidays to Google and its employees and your new Christmas gift.   View the video to see  the new Google building.

Visit msnbc.com for breaking news, world news, and news about the economy

Senator Ron Wyden
Oregon Business Summit Remarks
December 13, 2010

When we held the first Oregon Business Summit in 2002, Duncan Wyse and I thought success would be having enough people to fill a couple of booths at a Denny’s. In fact, when an ice storm came out of nowhere we thought we were jinxed.

When the doors opened, like this morning, there were hundreds of business people from every corner of the state. Today, this is the place to be. From the beginning, the key principles of this summit have been reconciliation and compromise with as much bipartisanship as we could get our hands on. It’s still that way. Let me give you an example. When I arrived at the Pendleton Round-Up last September after a bone-crunching, 13-hour flight from Washington, D.C, a local rancher came up to me, shook my hand and said: “You are doing great back there in DC, guy. Keep up the great work, Greg!” Now, obviously, he thought I was Congressman Greg Walden. Not wanting to pass up the chance to hitch a ride on Greg’s coattails and advance the cause of bipartisanship, I said: “Hey, thanks a lot. And I like working with Ron Wyden, too.

Civilian Labor Force Tops Two Million
By Oregon Employment Department,

Oregon’s seasonally adjusted unemployment rate was 10.6 percent in November, essentially unchanged from 10.5 percent in October. The rate has been between 10.5 and 10.7 percent for the most recent 13 months. Oregon’s unemployment rate was 10.7 percent in November 2009.

The month marked the first time that Oregon’s civilian labor force surpassed two million people. The exact figure was 2,001,060 in November, which was up from 1,984,209 in October. It is likely that population growth in the state has been one of the primary drivers of recent growth in Oregon’s labor force. Economic expansion, following the depths of the recession in mid-2009, is also a likely contributor.

In November, Oregon’s seasonally adjusted nonfarm payroll employment rose by 6,300, following a revised gain of 6,700 in October. Private-sector employment added jobs on a seasonally adjusted basis in five of the past six months. Since its recent low point of 1,290,300 in March, private payroll employment gained 17,700 jobs, or 1.4 percent. It accounted for nearly all of the seasonally adjusted job gains in November and over the past 12 months.

What if you gave away health care and no one showed up?
by Eric Fruits
EconInternational

Back October, I contributed to some research on state spending priorities. One of the recommendations was to eliminate a new program called Healthy Kids Connect. The program was funded with hundreds of millions of dollars in new taxes on private health insurance and hospitals. The study reported the following:

“Proponents of the program and DHS projected that the additional tax revenues would provide health insurance coverage to 80,000 Oregon children by the end of the 2009-11 biennium. However, with only a few months remaining in the biennium, the program has yet to enroll 26,000 more children to reach its projections.” [Citations omitted]

The Portland Tribune recently confirmed my earlier forecast:

By Tim Duy,
Oregon Economic Forum
sponsor, KeyBank.

The University of Oregon Index of Economic Indicators™ rose 0.2 percent to 87.2 (1997=100), the second consecutive monthly increase. Compared to six months ago, more than half the index components declined while the UO Index fell 5.9 percent (annualized).

Highlights of the report include:

• The UO Index was revised to reflect improved estimates of payrolls in the employment services sector – largely temporary help firms. Another of the members of the Governor’s Council of Economic Advisors, Ham Nguyen, noticed that these estimates were likely to be officially revised upwards when the employment department issues new estimates early next year. The revisions resulted in a more pronounced rise in the UO Index during the early stages of the recovery, but the mid-year recovery remains intact.

• Both initial unemployment claims and employment services payrolls – largely temporary hiring – were largely unchanged. The overall trends in these indicators, elevated initial claims and stagnating employment services payrolls, generally suggests weak hiring activity.

Oregon and World Exchange Rates
By Patrick Emerson
Oregon Economics Blog

The Federal Reserve Bank of Dallas has issued a report that creates a real trade weighted value of the dollar for each state. This is weighted by the specific countries where the state exports to and imports from and by how much they do so. The point is that national exchange rate indices do not always give an accurate impression of how exchange rates are affecting individual states. Oregon, for instance, trades relatively heavily with East Asia and relatively little with South America.

First, how important is trade for Oregon? Well, the statistic I always cite is old, but the most recent we have and shows that in 2006, Oregon was the 5th highest state in terms of the importance of exports to jobs.

Lawsuits Take School’s Swing Sets Away From Kids
by Mike Lepage
US Chamber of Commerce

Everyone has favorite childhood memories. For many people, those memories include rolling down slides, dangling off of monkey bars and swinging on swing sets at their local neighborhood playground.

But elementary school students in Cabell County, West Virginia, may miss out on some of those childhood pleasures. That is because the county’s school system has decided to remove swing sets from all school playgrounds, due to lawsuit fears. Their story is featured as part of the U.S. Chamber Institute for Legal Reform’s Faces of Lawsuit Abuse campaign.

New economic study highlights international trade as a strength for both the Portland-metro region and the state
Data show that International Trade sector gives Oregon and Portland substantial competitive advantages; provides jobs
By Portland Business Alliance

PORTLAND, Ore. – Today, business and community leaders released a report showing that international trade is an economic strength for both the Portland-metro region and the entire state of Oregon, increasing wages and growing jobs. This report is a companion analysis to A Check Up on the Portland Region’s Economic Health, which identified alarming findings about job loss and sagging wages and incomes in the Portland-metro region.

The International Trade Study reveals that 470,000 Oregon jobs are associated with exporting and importing activities in both the manufacturing and non-manufacturing sectors. Portland-metro accounts for 268,000 of those jobs. Additionally, the study says that workers in export-oriented firms earn between 9 and 18 percent more than their counterparts in non-export-oriented firms, showing that international trade doesn’t just create jobs; it creates higher paying jobs.

Employee Gifts: How to Give Tax-Free
By National Federation of Independent Business

As you decide on an appropriate holiday gift for your employees, it’s important to consider not only what they’ll enjoy but also how taxes will come into play. Because a “gift” is often considered by the IRS to be compensation, it’s important to note the rules so that your employees are not responsible for paying taxes on their gifts. “Get creative so the reward isn’t an individual burden to the employee, but a company expense,” says Brent Shelton, spokesperson for FatWallet, Inc., an online shopping resource website based in Rockton, Ill. “That way it stays as a reward.” Here are some options that will ensure your employees won’t face a tax on their holiday gifts.

Give a gift under $25. Gifts under $25 are tax-exempt, explains Howard Rosen, CPA, president and principal of Tax Services for Connor Ash in St. Louis, Mo. If this is the amount you typically spend on each employee, then you have nothing to worry about.

By Ian Crawford
Stoel Rives LLP,
Oregon Law Firm

OSHA compliance recently became harder and costlier, and may continue to do so, thanks to several developments at the federal and state level. (Click here for a prior post on OSHA reform.)

You may go to prison if you discipline or terminate an employee who might be worried about an unsafe working condition—even though your employee had not bothered to tell you about his concern. That is what the current version of the Robert C. Byrd Miner Safety and Health Act of 2010 (H.R. 5663) provides.

The Byrd Act, not yet law, would prohibit firing or discriminating against an employee who refuses to perform the his duties if he “has a reasonable apprehension that performing such duties would result in serious injury to, or serious impairment of the health of, the employee or other employees.” Employers should wonder how they will know whether their employees have “reasonable apprehensions”—the Act does not require the employee to voice his apprehension for this provision to protect him from discrimination for failing to do his work. If the Act becomes law, an employer who fires an employee because that employee is not performing may find itself faced with a complaint.

Welcome to Oregon … things look bleak here
by Eric Fruits
EconInternational

Some bad economics news coming out of Oregon. First, Portland’s mayor rejects an economic study because it doesn’t blow enough sunshine about the city’s business environment and its livability. Next, the the governor elect, speaking at the business/politician cabal better known as the Oregon Business Plan Leadership Summit, declares that the state is in a “death spiral.”

Now, it is revealed that our “best and brightest” are facing some pretty dim job prospects.

The figure below suggests that colleges grads in the Pacific Northwest have little to look forward to when they hit the job market. So much for the theory that the “young creatives” will fuel our next economic boom.

Earlier Departure, Longer Commute
by Gail Krumenauer
Oregon Employment Department,

Oregon workers spent a combined total of 35.2 million minutes traveling to their jobs in 2009. That’s down from 36.8 million minutes spent on the one-way trip to work in 2007. As employment levels dropped off from their peak in 2007, the Census Bureau’s American Community Survey numbers show a corresponding drop (-65,000) in the total number of workers commuting in Oregon between 2007 and 2009. The reduction in work travelers and aggregate time commuting generally hasn’t translated to a drop in travel time per commuter; the average minutes each Oregonian spent en route to work remained stable from 2007 to 2009. The only notable change in the post-recession commuter experience has been the mode of transportation used to get to work.

Texas Free Market Policies Beat California’s Economic Strategy
By Oregon Tax News

Texas managed to pull itself out of the recession with its free market policies during a time when California’s economy continues to decline. The Chief Executive magazine ranked California as the worst business climate in the nation, while Texas’ ranked the best. Experts attribute Texas’ vast natural and human resources combined with its low spending, low taxes, and low regulation to its economic growth.

Texas has been the top job-creator for the last decade. The Labor Department reported that eemployers in Texas added 47,900 jobs in October 2010. Texas currently faces an unemployment rate of 8.1%, drastically lower than California at 12.4%. The truth is that Texas has the ability to attract outsiders. The state gained over 800,000 new residents over the past decade during a time when California lost nearly 1.5 million people. California’s loss was the second highest New York. Economist John Husing bases California’s residency loss on its economic performance because California’s economy has not produced a single new net job since 1998.