We can take some small pleasure in knowing that we live in a region that supports small business. We know this because the majority of voters in Central Oregon voted against Measure 66 and 67.
However, the pleasure ends there. Small businesses that did not show a profit last year are still required to pay the state for staying in business. (Many unfortunately have not been able to stay afloat: businesses filing bankruptcy in 2009 increased by 42 percent.) When you get your corporate tax returns you will be required to pay $150 for every business entity you have even if you showed a loss in your company, plus another $100 to the state’s corporation division for your annual report, plus another $50 to the City of Bend for your city license.
In addition, this past legislative session increased the vehicle fuel tax by six cents and passed a bill that increased all DMV fees. Title went from $55 to $77, vehicle registrations from $54 to $86 for two years, plates from $5 to $23, custom plates from $50 to $100 for two years and trip permits from $20 to $30.
For companies facing even the smallest increase in taxes and fees it can mean the difference in hiring another employee, expanding your business and funding necessary marketing plans.
If you voted for these tax measures, we ask you if you know what a challenge it is to stay in business during a recession? Have you tried recently to get a line of credit to help with your cash flow? Have you had to lay off employees? Do you have to work seven days a week to keep the company going? Do you understand that nearly every business in this state took anywhere from a 15 to 40 percent decrease in income last year?
If you’re a legislator who voted for this tax package to honor your out of control spending we will not be supporting you for reelection. We encourage every business owner to look very closely at what level of support a candidate for office will be giving to small businesses.
The Alliance of Oregon’s Business Associations has launched www.OregonTaxResponse.com, which intends to capture and quantify some of the real-life impacts of Measures 66 and 67 on Oregon companies and their employees.
The Alliance recognizes that Oregon companies are continuing to make adjustments in this very difficult economy. Some changes would have occurred regardless of the tax increases. But the Alliance is also aware that some of these job losses came as a direct result of the tax hikes. To track the employment consequences of Measures 66 and 67, the Alliance established the website where you can record the impact of the legislature’s tax increases.
Information gleaned from the website will be used to demonstrate the impacts of tax increases on Oregon employers so that policymakers and legislators have a better grasp of how specific taxes affect Oregon’s economy.
We encourage you to participate in the collection of this information.
Is Help on the Way?
Much has been written about the Small Business Administration’s ARC loan program that did little to help companies that were hurting due to the recession. Few loans were made and some local companies that were approved eventually turned down the money because of the unreasonable and unexpected demands and restrictions made on the loans.
Oregon legislators have informed us that they are still working to correct the process and the lack of realistic response from the SBA. However, once burned it’s unlikely that businesses will be willing to go through the grueling and time consuming process of applying for these interest free loans.
Giving up on the feds, we might ask: what about the State of Oregon, what help can they give business? On April 1, Governor Ted Kulongoski signed SB 1017 that is slated to expand the flexibility of the state’s economic development department, Business Oregon, to help Oregon companies with several financing tools.
The bill is supposed to help you access necessary capital to expand or continue business operations to retain and create quality jobs for Oregonians. The additional capital and program enhancements under the Access to Business Capital Act ensure that the Oregon Business Development Fund (OBDF) will continue to have the resources needed for making loans to Oregon’s small- and mid-sized businesses during these difficult economic times.
According to Tim McCabe (director of Business Oregon) SB 1017 gives the state the discretion to approve loans up to $250,000 (the previous limit was $100,000) expediting the process for businesses to access needed capital.
Contact the Oregon Business Development Department at 866-467-3466 for more information about this and other state programs.