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Oregon Leaders Say Coronavirus Means Major Economic Problems

Oregon leaders are just starting to turn their attention to how to protect workers and businesses from the economic fallout they know coronavirus will cause.

Gov. Kate Brown, citing the urgency of “keeping the economy humming,” is forming a new business-labor council. It’s set to first meet on Tuesday look at issues ranging from unemployment benefits and sick leave payments for workers to how the state can help businesses hit by coronavirus-related shutdowns.

State leaders may get help from the federal government.  President Donald Trump’s emergency declaration Friday allows him to tap into $50 billion approved by Congress for disaster relief related to the epidemic. House Democratic leaders and administration officials reached agreement on an economic aid package to bolster unemployment and sick-leave benefits throughout the country.

In Oregon, officials say they’re still trying to figure out what they should do.

“We are all working hard on a stimulus to take care of our employees or businesses that have to cut back or close, because this thing is really devastating from that standpoint,” said Senate President Peter Courtney, D-Salem.

He provided little in the way of specifics, saying “This thing is evolving very quickly.” 

“This is just such a fast, free-wheeling crisis, it’s hard to get your hands around it,” said Sandra McDonough, president of Oregon Business & Industry, a top business advocacy group.

On Wednesday, she asked the governor to form a group scrutinizing the economic issues. Brown announced the council a day later.

Christian Gaston, an aide to the governor, said it is “pretty early days” in the fast-moving crisis with more questions than answers.

“Are there gaps in the benefits,” he said. “Are there services the state is not providing that it ought to be providing? Are there administrative rules that we can adjust or suspend?”

Union officials say they’re pushing to strengthen the 2016 law requiring most Oregon businesses to provide up to five days a year of paid sick leave.

Melissa Unger, executive director of Local 503 of Service Employees International Union, said five days is not enough when workers are asked to stay home when they don’t feel well.

“We should be an example of a place where we’re trying to make sure that workers aren’t making a choice between providing for their families and keeping the community safe,” she said. 

Unger said she also wants to boost health care benefits to many home health aides and lower-paid hospital workers who often have scanty health insurance.

Oregon also has some unemployment insurance benefits that officials think they can use to help workers affected by the epidemic. The state’s Work Share program allows workers to get benefits if their hours are cut. And if their employer shuts down for less than a month, workers can get short-term benefits without having to seek or accept other employment.

Gaston, the gubernatorial aide, said the state has also learned from the federal government that workers can get unemployment benefits if they are unable to work because they are quarantined.

Other proposals include providing aid for self-employed workers — such as car-share drivers — who aren’t eligible for unemployment benefits, as well as emergency rental assistance. 

At the same time, officials say they want to find ways to help keep businesses from going under.

“We’ve got to start looking at how do we particularly help small businesses,” said McDonough, the business association president. “This can really topple them.”

State officials say they’re looking at making sure Oregon businesses qualify for emergency loans from the Small Business Administration. They might also talk with banks about delaying some current loan repayments.

Oregon Labor Commissioner Val Hoyle also provided a measure of regulatory relief to some larger businesses, saying that those subject to a “ predictive scheduling” law can balance that with concerns about “pandemic driven public health concerns.” Starting in 2018, Oregon required that retail, food and hospitality employers with more than 500 workers provide at least seven days' notice to workers of their shift schedules. That increases to a 14-day notice on July 1.

Hoyle said in an interview that her office had been getting a lot of calls from businesses worried that it was hard for them to tell what their staffing needs would be like in the next day, let alone in a week.

Courtney, the Senate president, said he thinks the Legislature will have to weigh in soon.

“We have employees that are going to lose their jobs, and small businesses that will shut down and we can help,” he said. Legislative leaders have already been planning for a special session following the abrupt shutdown of the regular session earlier this month following a Republican walkout over a climate bill.

Now, Courtney said, issues related to the coronavirus would be a major focus of a special session — whenever it happens.

For now, state lawmakers have created a joint committee to come up with issues to address coronavirus, but work will likely need to be remote. The state Capitol has restricted activities, including stopping rallies and all group meetings. 

At the local level, Portland Mayor Ted Wheeler has directed city officials to work with Portland Prosper, the city’s economic development agency, to look at how to provide economic stimulus.

Spurring additional economic activity could be crucial.

Josh Lehner, an economist with the Oregon Office of Economic Analysis, said the hotel, travel and restaurant industries are being hit particularly hard by the steep drop in travel and tourism and the shutdown of sporting events and other large public gatherings. He said these businesses account for nearly 9% of the state’s economic activity, according to 2017 census figures.

This and other consumer spending are the major drivers of the strong economy that is now being battered by the epidemic. That could be the catalyst leading people to cut back on their spending, Lehner said.

“If enough people become pessimistic or worried at the same time,” he added, “that could be the start of a recession.”

Editor's note: This story has been updated to reflect the amount of money made available by Congress for Trump's disaster declaration.

Copyright 2020 Oregon Public Broadcasting

Jeff Mapes is a senior political reporter at Oregon Public Broadcasting. Previously, Jeff covered state and national politics for The Oregonian for nearly 32 years. He has covered numerous presidential, congressional, gubernatorial and ballot measure campaigns, as well as many sessions of the Legislature, stretching back to 1985. Jeff graduated from San Jose State University with a B.A. in journalism.
Lauren Dake is a political reporter and producer for Oregon Public Broadcasting. Before OPB, Lauren spent nearly a decade working as a print reporter. She’s covered politics and rural issues in Oregon and Washington.