By Oregon Restaurant Association & Lodging Association,
Oregon is officially gearing up for another Legislative Session in Salem with newly elected legislators hoping to make a difference for their constituents. As is typical with elections, results rarely if ever align on all fronts with your personal preferences. Regardless of the election outcomes this past Fall, it is our job at the association to build effective working relationships with leaders from both parties.
We had a very tangible return on investment recently which most likely stood out to you as a hospitality operator to prove how ORLA advocacy and relationship building efforts can drive bottom line results for your business – House Bill 3389 in the 2021 Legislative Session.
Restaurant and lodging businesses become members of ORLA because they understand the importance of industry representation and intelligence gathering. There are of course other reasons to join ORLA but for me, House Bill 3389 takes the cake. Our hope is the updates below showcase why it is of crucial importance for us to continue to band together to protect, improve, and promote Oregon’s hospitality industry.
What Was House Bill 3389?
House Bill 3389 was collaborative legislation passed in 2021 to provide short- and long-term pandemic tax relief to Oregon employers while protecting the Unemployment Insurance Trust Fund. This important bill provided assistance to Oregon employers in several ways:
- It extended the “look back period” used to determine the Unemployment Compensation Trust Fund solvency level from 10 years to 20 years.
- It kept employers’ Unemployment Insurance tax experience rating the same, through 2024, as what was used to determine the pre-pandemic 2020 tax rates.
- It deferred up to one-third of 2021 taxes until June 30, 2022 and provided forgiveness of penalties and interest accrued during that time for employers meeting certain criteria.
- It enabled some employers to be eligible for full or partial forgiveness of their deferrable 2021 Unemployment Insurance taxes.
Combined, the short- and long-term provisions of House Bill 3389 provide significant relief to Oregon employers.
- In 2021, after the bill passed, more than 4,000 employers took advantage of the option to defer tax payments. That resulted in approximately $1.1 million in interest and penalty forgiveness.
- Through the bill’s short-term provisions, the Oregon Employment Department (OED) has provided Unemployment Insurance tax forgiveness to more than 19,000 employers and has issued more than $43.3 million in payments to eligible employers. The refunds issued varied widely in amount due to Oregon’s wide range of eligible employers, from very small businesses to larger corporations.
- In 2022, most employers, about 125,000, saw a decrease in their tax rate from the prior year as a result of the passage of House Bill 3389.
- Looking longer term, from 2021 to 2029, these changes are estimated to save Oregon employers $2.2 billion in unemployment insurance taxes.
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