Building Owners & Managers Association
By Nellie deVries, Government Affairs
2019 Might Be the Most Unusual and Tumultuous Session… To Date
The 80th Oregon State Legislature began with leadership excited and anxious to pass a very long list of ambitious priorities that have been pursued for years. For the first time in Oregon’s history, Democrats controlled super majorities in the House, Senate and held the Governor’s office. Leadership’s hefty agenda included big ticket items like rent control, carbon cap and trade, PERS reform, banning plastic bags, national popular vote, driver’s licenses for all, extended paid family leave, a $2 billion business tax increase on commercial activities for schools as well as a variety of other new taxes.
Public employee unions, environmental groups and trial attorneys who worked tirelessly to attain Democratic supermajorities in the Oregon Legislature expected many of their priority bills to pass.
In the early weeks of the 2019 Legislative Session, the prediction of passing priority bills appeared to be true. Rent control, which failed by one vote during the 2017 Legislative Session, sailed through the Senate and House and Governor Brown signed it into law on February 28. If this was any indication how quickly priorities would pass in the coming months, stopping any priority bill seemed next to impossible.
However, as the session progressed, many Democrats questioned the value of the supermajorities because there was plenty of political infighting among the progressive and moderate Democrats. The teacher unions were upset about cuts made to the education budget with a record year of revenue and the environmentalists were disappointed with the “watered down” cap and trade bill.
Tensions grew as the House and Senate Republicans became more and more irrelevant and watched party-line vote after party-line vote. The House Republicans refused to suspend the rules for days requiring that each bill be read line-by-line and stalling the legislative process. The Senate Republicans walked off the floor in May refusing to vote on the $2 billion tax increase for schools that had already passed the House. As a result, in exchange for a quorum on the Senate floor, the Senate Republicans managed to negotiate killing a bill requiring mandatory vaccines and one lifting the age a person may purchase a gun from 18 to 21 years of age.
While walking off the floor is not unprecedented and has been done by both Democrats and Republicans in the past; it was unusual to have the Senate Republicans walk out (and some leave the state) a second time during the last few days of the legislative session. This time, the walk out was because of HB 2020, the cap and trade bill to limit carbon emissions. Loggers and truckers stormed the Capitol arguing this bill would kill their jobs. At perhaps the pinnacle of the tensions, after threats were made on the Senate floor, Governor Brown asked the state troopers to arrest the hiding Senate Republicans and bring them to the Capitol for a quorum. While there were no arrests, the likelihood of a compromise on HB 2020 and the fate of hundreds of bills that were waiting for a Senate vote remained at a standstill for 9 days.
Finally, on Friday, June 28, the Senate Republicans announced that they would come back to the Senate (and state) for the 2 remaining days of the 2019 Legislative Session. On Saturday, the Senate voted on 105 bills and officially killed HB 2020, cap and trade. The drama ended just after 5:30 pm on Sunday, July 30, with just over six hours until the required constitutional deadline. Overall, the Democrats managed to pass many of their priorities; however, not without drama and not without further marginalizing themselves from the Republicans. The last two days in the Senate were full of name calling, finger pointing, and overall disdain for each other. Hopefully, some time off will lead to better decorum in the future. And with that, the 2019 Legislative Session is over.
BUILDING OWNERS & MANAGERS ASSOCIATION PRIORITIES
Despite the drama of the 80th Legislative Session the Building Owners & Managers Association had a fairly good session. The Association’s Legislative Team tracked over 80 bills on various issues affecting BOMA interests. You may access the BOMA’s 2019 Bill Tracking program on its website at http://www.bomaoregon.org/advocacy/.
BOMA would like to thank the Legislative Committee members whose collective efforts helped enhance the Association’s credibility and effectiveness in the Legislative arena. Below is a list and explanation of some of the tracked bills:
Cap and Trade
HB 2020 – Failed
BOMA closely monitored the many hearings on cap and invest or Clean Energy Jobs. Oregon Carbon Policy Office issued a report citing the International Panel on Climate Change that emissions need to be 80% to 95% below a 1990 baseline in order for atmospheric concentrations of GHGs to stabilize at a level likely to avert the most catastrophic effects of climate.
After over 100 proposed amendments and countless hours of hearings, the Joint Committee on Carbon voted to move the bill to the House floor. It passed and when it was up for a vote in the Senate, the Senate republicans walked off the floor and refused to vote on the bill.
Decoupling Historical Registries and Owner Consent
SB 927 – Failed
As drafted, SB 927 allowed local governments to develop historic resource program to designate resources for protection. However, it removed the requirement for owner consent to designate resources. This bill saw a serious of 8 amendments working toward compromise. Ultimately, BOMA could not support the majority of the amendments because they all removed owner consent in one way or another. Politics aside, it was determined that decoupling could happen by rulemaking, and BOMA’s legislative advocate will be sure to be a part of the process in the interim.
Historical Property Tax Credit
SB 829 – Failed
This bill would have created a tax credit for certified historic property project contributions. The bill directed the Department of Revenue, in cooperation with State Historic Preservation Officer, to conduct an auction of tax credits. It established a State Historic Property Project Fund and requires that auction proceeds be deposited in fund for purpose of making rebates to property owners for eligible expenses for rehabilitation and seismic retrofitting of historic properties. The main issue with this bill is that it allowed local jurisdictions to pick and choose properties and did not set specific standards in the language.
URM Safety Program
HB 2208 – Failed
HB 2208 would have created an Unreinforced Masonry Seismic Safety Program to issue grants for improving seismic safety, stability and resiliency of qualifying unreinforced masonry and unreinforced concrete buildings.
Building Safety After Emergency Inspections
HB 2206 – Passed
This bill directs State Fire Marshal to develop and administer program to evaluate condition of buildings after emergency and determine whether buildings may be safely occupied.
Business Tax Increase
HB 3457 – Passed
This bill raises $2 billion per biennium for schools, arguably, most of which will be used to help fund the Public Employee Retirement System (PERS). The tax would require businesses to pay a tax of 0.57% on sales inside the state’s borders that exceed $1 million. The first $1 million in sales would be exempt. There are some carve-outs for gas, groceries and some health care providers. In addition, businesses could subtract 35% of their labor or capital costs from total sales and there is a personal income tax cut by 0.25% for some consumers.
There are about 460,000 businesses in Oregon, about 40,000 of which would be hit by the new tax, according to information from the legislative revenue office.
Electric Vehicle Charging Stations
HB 3141 – Failed
BOMA testified in opposition to HB 3141 as originally drafted. The base required newly constructed buildings to provide for charging of electric vehicles (EV). It applied to public and multifamily residential buildings and required a 110-volt or 240-volt system for EV charging be available for at least 10 percent of vehicle parking spaces in the garage or parking area. The law would have gone into effect on July 1, 2020 and applies to new construction for which a building permit is initially issued on or after January 1, 2022.
HB 3141 also required DAS to ensure at least 25 percent of vehicles purchased by department weighing 8,000 pounds or less and vehicles leased by department for non-emergency purposes are zero-emission vehicles no later than January 1, 2025.
The bill was amended to apply only to newly constructed multifamily residential buildings with three or more residential dwelling units must provide capacity for the charging of electric vehicles in at least 20 percent of the parking spaces. Public and commercial buildings are not included. Further, the amendment lessened DAS mandate to a recommendation or a goal.
Substantial Completion Statute of Limitations
SB 369 – Passed
BOMA monitored SB 369 after participating in a workgroup with the proponents (American Institute of Architects) and other industry members to fine tune the concept. SB 369 modifies the statute of limitations for action against an architect, landscape architect or engineer arising out of construction, alteration or repair of improvement to real property. In order to do so, the bill modifies definition of “substantial completion” for purposes of statute of limitation for action arising out of construction, alteration or repair of improvement to real property.
The added language to the statute is that substantial completion is the earliest of the three: (A) The date when the contractee accepts in writing the construction, alteration or repair of the improvement to real property or any designated portion thereof as having reached that state of completion when it may be used or occupied for its intended purpose or, if there is no such written acceptance, the date of acceptance of the completed construction, alteration or repair of such improvement by the contractee[.]; (B) The date when a public body issues a certificate of occupancy for the improvement; or (C) The date when the owner uses or occupies the improvement for its intended purpose.
Third Party Permitting
HB 2420A – Failed
BOMA also monitored HB 2420, which attempted to address the issue of smaller jurisdictions solely contracting their permitting process out to third parties, which, according to several legal interpretations, invalidates existing permits.
Oregon law establishes a state building code to govern the construction, reconstruction, alteration and repair of buildings and other structures. Much of the code is adopted by rule of the Department of Consumer and Business Services. Oregon law also authorizes cities, counties and other local governments to agree to administer and enforce a building inspection program, for a period of four years at a time. Pursuant to this delegation of authority, a municipality must appoint a building official to attend to all aspects of code enforcement, including the issuance of building permits.
HB 2420A requires municipalities who administer and enforce a building inspection program to employ a municipal building official and a head building inspector. A single employee may share both duties and be employed to perform services by up to three local governments. The bill authorizes the use of non-employee inspectors to perform routine enforcement services, subject to supervision by the head building inspector. House Bill 2420 declares an emergency, effective on passage, while delaying the operation of the substantive provisions in the bill until July 1, 2021.
OTHER BILLS OF INTEREST
Marijuana in the Workplace
SB 379A – Failed
This bill prohibits conditioning employment on refraining from using any substance that is lawful to use in this state is unlawful employment practice (i.e. marijuana). The committee adopted the -1 Amendment on the party line that adds additional exemptions that allow
“employers of public safety personnel, licensed health care professionals, operators of public transit vehicles and taxies, and other employees that perform work involving a risk of injury to others to condition employment on the employee refraining from the use of certain legal substances.” The amendment also addressed federal contractors, those receiving federal grants subject to the federal Drug-Free Workplace Act, and those required by federal law or regulation to test their employees for certain substances can also condition employment on abstaining from the use of certain legal substances.
Ban on Single Family Dwellings
HB 2001- Passed
HB 2001 outlines regulations related to middle housing, including where middle housing is allowed and how it can be regulated. Cities are directed to update their land use regulations or amend comprehensive plans in order to encourage middle housing by June 30, 2021 or by June 30, 2022, with deadlines based on population.
Under this measure, the Department of Consumer and Business Services is directed to establish standards for a municipality to allow alternate approval of construction that converts a single- family dwelling into four or fewer residential dwelling units.
The Land Conservation and Development Commission, in partnership with the Department of Consumer and Business Services, is to develop a model middle housing ordinance by December 31, 2020, which local governments must use if they have not developed their own housing ordinance.
The measure appropriates $3.5 million General Fund to the Department of Land Conservation and Development to provide technical assistance to local governments to assist with the adoption of regulations or amendments to comprehensive plans as required by the bill.
Paid Family Leave
HB 2005 -Passed
This bill is the result of negotiations between business groups and the proponents. creates an insurance program to provide employees with portion of wages while on family, medical, or safety-related leave. The bill requires eligible employee to have received at least $1,000 in wages during base year. It allows self-employed individuals and tribal government employers to opt into program. It requires an employer to pay 60 percent of contributions and employee to pay 40 percent. Employers with fewer than 25 employees are exempt from obligation to pay contributions. The bill caps eligible employee’s average weekly wage used in calculation at total yearly wages of $132,900. It also caps the weekly benefit amount at 120 percent of state average weekly wage (approximately $1,215) and establishes floor at five percent (approximately $50).
The bill also authorizes a maximum of 12 weeks of insurance benefits, with total paid and unpaid leave capped at 18 weeks. It authorizes the use of vacation or sick time to supplement insurance, up to 100 percent of wages, with consent of employer. Finally, the bill appropriates unstated amount to enable Employment Department to implement the program, with the requirement that the Employment Department reimburse the General Fund by January 1, 2023. It requires the collection of the contributions beginning January 1, 2022, with benefits payable beginning January 1, 2023.
Lowering the Voting Age
SB 838 – Failed
If passed, SB 838 would have lowered the voting age from 18 to 16 years of age. The bill received a public hearing, but no serious formal action.
This report has been prepared by BOMA’s Government Affairs advocate Nellie deVries