As 2025 closes, the familiar rhythm of year-end planning is back — but with a twist. Central Oregon’s vibrant and resilient business community needs to look beyond the immediate horizon and strategically prepare for shifts in Oregon’s legislative and economic landscape in 2026.
This isn’t about bracing for a storm; it’s about having a proactive, proven game plan.
Strategic Insights from BBSI: The guidance shared here represents the same field-tested strategic counsel we provide to our own BBSI (Barrett Business Services, Inc.) clients across the region. We focus on helping them maintain stability, pivot effectively, and plan confidently. We believe these insights will be invaluable as you determine where, when, and how to pivot your own business next year.
The State Budget Juggling Act & Local Impact
Oregon is currently wrestling with a significant state budget deficit for the upcoming biennium. When the state tightens its belt, the reverberations are felt locally throughout Central Oregon, impacting everything from contracts to the local labor pool.
If your business contracts with state or local public agencies (schools, government departments), you should anticipate increased budget scrutiny and potential slowdowns or reductions in project scopes and payments. The pivot here is to sharpen your invoicing processes and actively diversify your client base.
Furthermore, budget cuts to areas like education and job training programs could affect the long-term availability of skilled local talent. A key strategy is to double down on internal training and mentorship programs now to cultivate the skills you need in-house. As the state looks for ways to balance the books, tax adjustments are always possible. Consult with your CPA to monitor any proposed shifts related to the Corporate Activity Tax (CAT) or other business fees. Proactive preparation is critical.
New Legislative Mandates for 2026
This fiscal environment is paired with significant legislative changes. A few major pieces of Oregon law are scheduled to take effect on January 1, 2026, which require immediate updates to your HR and payroll compliance systems.
One of the most immediate changes is Payroll Transparency (SB 906). This law mandates that you provide every new hire with a written, detailed explanation of their earnings and deductions. This explanation must cover the pay period schedule, a comprehensive list of all potential pay rates (hourly, commission, etc.), all deduction codes, and their definitions.
- BBSI Guidance: Compliance is centered on documentation. You must get your HR onboarding and payroll software documents updated now to include this new, transparent disclosure.
In parallel, Age-Blind Hiring (HB 3187) is aimed at fighting age discrimination. This law generally prohibits asking an applicant for their age, date of birth, or graduation date until after the initial interview or after a conditional job offer is made.
- BBSI Guidance: Immediately review all application forms and train your hiring managers. The focus must remain purely on a candidate’s skills and experience during the early stages of the process to ensure fair practice and reduce liability.
Finally, for the construction industry, Construction Wage Liability (SB 426) is a high-risk change. Property owners and direct contractors can now be held jointly and severally liable for unpaid wages owed to subcontractors’ unrepresented employees (non-union) at any tier.
- BBSI Guidance: You need a stricter vendor management system. Vet subcontractors rigorously and update all agreements to include mandatory certified payroll submissions and indemnification clauses to mitigate this significant new financial exposure.
Federal Tax Landscape: Maximizing Year-End Deductions
In addition to state and local issues, don’t overlook critical federal tax deadlines that influence cash flow and investment decisions. The end of 2025 is a key period for maximizing deductions before potential changes take effect.
For instance, 100% bonus depreciation is generally reinstated for eligible assets placed in service after January 19, 2025. This provides a massive opportunity to fully deduct the cost of capital expenditures (e.g., equipment) in the year they’re acquired. Furthermore, businesses can now generally immediately deduct domestic Research & Experimental Expenditures, instead of having to amortize them over five years. This is a huge cash flow boost for innovative local companies.
- BBSI Guidance: We advise clients to conduct a deep tax accounting method review before year-end to maximize these deductions. Aligning your purchasing timeline with these tax changes can create substantial savings that improve your 2026 operating budget.
Your Strategic Year-End Game Plan for a Strong 2026
To synthesize these state and federal requirements into actionable steps, Central Oregon businesses should focus on three priorities:
1. Optimize Cash Flow: Make getting paid faster your top priority. The quicker you move money from accounts receivable to your bank, the more resilient you are to economic slowdowns or delayed government payments. This is the first pivot our most successful clients make.
2. Compliance Lock-Down: Dedicate the necessary time now to ensure your HR materials are fully updated and compliant with the SB 906 and HB 3187 mandates for the January 1, 2026, deadline.
3. Engage Local Resources: Stay plugged into the local economic landscape. Resources like Economic Development for Central Oregon (EDCO) and your local Chamber of Commerce are essential sources of up-to-the-minute local economic data and business opportunities.
Looking Forward with Central Oregon Confidence
Central Oregon thrives because of the grit, ingenuity, and collaborative spirit of its business owners. We’ve faced unique local and statewide challenges before — from recessions to rapid growth — and we’ve always emerged stronger.
Yes, 2026 demands smart, proactive planning to address legislative compliance and economic forecasts. But by implementing these field-tested strategies — updating your policies, securing your finances, and staying connected to your community — you aren’t just surviving; you are building a robust foundation for exceptional growth in the new year. Let’s make 2026 our most strategic and successful year yet!
