Oregon State Capitol/ File (Rachel Alexander/Salem Reporter)
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As the coronavirus outbreak continues to disrupt daily life across Oregon, legislators had their first discussion on the Legislature’s possible response to the pandemic.
With some legislators attending via video chat, the Joint Special Committee on Coronavirus Response for four hours on Wednesday listened to a dismal outlook offered by government officials and a range of business and labor groups who called in their testimony.
Businesses have seen their supply chains cut and their cash flow turn to a trickle. Caregivers for the sick and elderly face either losing their jobs or staying home to take care of kids as schools close. Hotels and restaurants sit empty. Businesses are laying off thousands of employees who are left struggling to pay rent or getting health care when they need it most.
The committee also heard how Oregon’s tax structure and worker safety nets are ill-suited for the unprecedented public health crisis. The state’s unemployment insurance doesn’t offer the same help to workers who rely on tips or are independent contractors. The fund that pays laid-off workers could find itself drained.
Businesses said that a new corporate activity tax slated to go into effect this year is flatly unworkable as they struggle to stay afloat during the outbreak.
No date has been set yet for a special legislative session and state officials are still awaiting a federal package aimed at easing the effects of the outbreak. But the hearing highlighted the economic strains facing Oregon workers and businesses. It also laid out responses being considered.
“Folks are scared and they are struggling,” Elana Pirtle-Guiney, legislative director for Gov. Kate Brown, told the committee. She added that Brown’s office was focused on “how do we keep people housed, how do we keep people fed, how do we address our business needs and economic preservation.”
Pirtle-Guiney said that Brown was considering a moratorium on evictions statewide, as well as help with rent and mortgage payments.
Sen. Arnie Roblan, D-Coos Bay, said that the committee will have to pump more money into the economy to mitigate a recession.
“But we are also going to have to recover from it,” he said.
Sen. Tim Knopp, R-Bend, said that besides keeping Oregonians safe, it will. be important to make sure they have money for food, bills and rent.
During the hearing, there was talk of overhauling the state’s unemployment and worker compensation system to speed up and broaden benefits for employees affected by the outbreak. There was also talk of protecting front-line health care workers first responders by ensuring that they could get child care. Service industry employees laid off due to restaurant closures also came up.
Businesses and taxpayers are expected to get a tax credit under the state’s “kicker,” which goes into effect when tax revenues exceed expectations. There was talk of turning the credit into a cash refund.
Representatives of business groups asked the Legislature to redirect the expected rebate on corporate taxes to the state’s unemployment fund. They asked to delay the new corporate activity tax and to make low-income loans available for beleaguered business.
“I have never seen the level of concern that I’m hearing from businesses every day in Oregon,” Sandra McDonough, the president and CEO of Oregon Business and Industry.
She said that businesses are facing bigger concerns than the Great Recession of 2008. She said that businesses, particularly small ones, may end up closing and never coming back.
Graham Trainor, president of the Oregon AFL-CIO, said that the outbreak has exposed “gaps and cracks” in the state’s safety net. While the state has a paid-leave law, he said that some workers, particularly lower income and minorities, have access to only its bare minimum. He said that workers employed in retail and at grocery stores face particular exposure and should be thought of as “frontline workers” during the outbreak.
Melissa Unger, executive director of Service Employees International Union, said that health care workers, hospital staff and caregivers for the sick and elderly face challenges accessing adequate medical insurance and time off. She called on the Legislature to take “bold action.”
“The reality is that this crisis lays bare many of the challenges the system had before the crisis,” she said.
Nik Blosser, the governor’s chief of staff, told the committee that the outbreak means the state is seeing less tax money. State economists are working on their next quarterly economic forecast to issue in May. Blosser said the economic damage isn’t clear but he expected a “sea change” from the previous rosy forecasts and state economists have included a recession in their baseline assumptions.
“Today I am sounding the alarm. Our needs will far outweigh our resources,” he said.
Contact reporter Jake Thomas at 503-575-1251 or [email protected].