Gov. Tina Kotek has a plan to boost Oregon businesses, but challenges remain steep

State lawmakers and business leaders have argued high taxes and stringent regulations are hurting Oregon businesses. In 2025, not long after a CNBC report ranked Oregon near the bottom of states to do business, Gov. Tina Kotek announced a plan to change that.

Among other goals, it aims to sharpen the state’s competitive edge through changes to permitting and taxation, partnerships with the private sector and incentives to invest in Oregon.

Angela Wilhelms is the president and CEO of Oregon Business and Industry, the state’s largest business advocacy organization. She joins us to discuss why businesses are leaving Oregon and whether the state can improve its business climate to keep them.

We also talk with OPB business reporter Kyra Buckley about Kotek’s roadmap and the challenges currently facing Oregon’s business community.

Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.

Dave Miller: From the Gert Boyle Studio at OPB, this is Think Out Loud. I’m Dave Miller. Last year, a CNBC report ranked Oregon near the bottom of states in which to do business. It was 39th out of 50. It was a precipitous drop. Less than a decade ago, it was in the top 20. Governor Tina Kotek has taken notice to the state’s plummeting reputation for business. Last month, she unveiled a prosperity roadmap that aims to strengthen the state’s economy. This month, she named Oregon’s first ever chief prosperity officer, a former Republican lawmaker.

In a few minutes, we’ll talk about all of this with OPB’s business reporter Kyra Buckley. First, I’m joined by Angela Wilhelms. She is the president and CEO of Oregon Business and Industry. It’s one of the state’s most prominent business advocacy organizations. Angela, welcome back to the show.

Angela Wilhelms: Thank you for having me. It’s good to hear your voice.

Miller: Likewise. So I mentioned that CNBC ranking. What metrics do you pay the most attention to to get a handle on how we’re doing as a state, business-wise?

Wilhelms: Yeah, it’s a great question. Here at OBI, one of the things we think about a lot is trends. So rather than any one metric, we look at a bunch of them – I’ll talk about a couple – but we also look at trends. You mentioned the CNBC Top States for Business ranking and its precipitous decline over the last handful of years really, where we went from 17th down to 39th. Another example of that is a tax competitiveness index, which looks at personal taxes, our lack of a sales tax even, and business taxes. And we have also seen a precipitous decline there, where we went from being a top 10 state for tax competitiveness in 2019 – we were 8th. And we have now fallen to 35th in just a handful of years. So that’s another thing we look at.

We also look at some pretty nuanced things that most Oregonians probably aren’t reading about. But for example, we rank 1st in the nation for occupational licensing burdens. So whether you’re a doctor, or a nurse in healthcare, or a welder, or any other number of professions that need occupational licensing – which is important – it’s the hardest to get licensed in Oregon. So we look at a collection of them and again, those changes. And right now, the directionality is not good and Oregonians know it.

Miller: I’m curious what stands out to you when you look not at the state level, but at the Portland area or even the city of Portland specifically?

Wilhelms: Well, this is no surprise. This has been in the news a lot and the Portland Metro Chamber has done a lot of work on this. But we do a tax study every so often that looks at changes in business tax burden. And in addition to the 33% increase in the state’s effective business tax burden that all businesses across the state have experienced, I believe, off the top of my head, the number was an 82% increase in tax obligations on businesses in that Portland metro area. And that was in a four year time period, between 2019 and 2023, an 80%-something increase in the tax burden on Portland metro area businesses.

That’s extraordinary when you think about the other cost pressures they’re facing. And that all not only relates to the business climate erosion in Oregon and the problems we’re seeing with jobs and other economic indicators, that’s also part of the affordability conversation in this state that we need to be taking seriously.

Miller: I want to run something by you, to see if you agree with this 30,000-foot view. It seems to me that the underlying policies, and even tax burdens at the state level over the last just two or three years, they haven’t changed really significantly, nor have your prescriptions that we’ll get to, lower taxes and fewer regulations. But it seems that what has changed is the Democrats like Tina Kotek are talking more forcefully about making Oregon more business friendly. First of all, just do you agree with that synopsis?

Wilhelms: We have certainly heard more policymakers, and really acutely at the end of 2025, talking about this issue. So yes, that is good news, as I said in a piece in the Portland Business Journal yesterday. It’s important because if you’re going to solve a problem, you have to first acknowledge it and talk about it.

But we have to remember that talking is very different than action. We have to very quickly get to action because we are competing. We don’t live in some economic vacuum here in Oregon. We are competing nationally and globally. And even to stand still means we’re falling behind in those relative rankings and metrics, and as a place to do business, because other states are actively investing in this work and trying to do better. The status quo means we’re falling behind, so we need to not only get out of that rut, we need to actually take some really proactive steps forward.

Miller: So let’s turn to what you want to see. What are the proactive steps that you’re calling for right now?

Wilhelms: We have a long list of ideas that we’ve been putting forward, it’s all captured in our Oregon competitiveness agenda. But I will just highlight a couple things.

This is really wonky, but the state of Oregon is the 7th most regulated state in the country. At the pace we’re going, we’re well on our way to moving up in that list. And we hear from businesses, particularly small and medium sized businesses, all the time that the regulatory complexity here, not even the goals and outcomes, but just the complexity of how we do business, is a real barrier to their growth and success. So we’d like to see some policy changes into how we go about establishing regulations.

We’d also like to see some of those most complex and costly regulations reevaluated. We don’t engage in a process where we take a look at their efficacy, the cost benefit analysis after they’ve been on the books for a while. So we’d like to take a look at some of those.

Miller: What are some specific examples of regulations that you think are most burdensome or problematic, or at the top of your list of what you’d like to erase?

Wilhelms: Well, there is a program that is online now called the Recycling Modernization Act. And this is a program through which businesses that in Oregon and that do business in Oregon will have to pay hundreds of millions of dollars in program fees. They go to a third party that’s hired by the Department of Environmental Quality. We’re talking like $700 million just in the next couple of years. And we are an outlier in the way that Oregon is structuring its program relative to other states. So for example, there’s a lot of talk and hope that in the legislative session we’ll see a fix that puts us back on par with some of those other states around business-to-business exemptions, for example. Because once again, we’ve structured a program that might be popping up in other states. We’ve structured it in a very different and outlying way here in Oregon, and we just can’t afford to keep doing that.

Another example is the Climate Protection Program. This is another one that’s going to cost hundreds of millions of dollars in just its first few years online. And the problem here is that we have created a system that is unlike any other carbon reduction system in the [country]. It is extremely costly, two times more costly than Washington’s program, three times more costly than California’s. And it really impacts manufacturers and those that distribute goods manufactured in Oregon. We can make some common sense updates to that to actually try and reduce greenhouse gas emissions, while putting us on par with peers competitively.

Miller: These, as I understand it, would require legislative action. What are you hoping for from the governor in terms of executive actions that can happen with the stroke of one pen, as opposed to majorities in two different chambers of the legislature?

Wilhelms: Yeah, there are a number of things she can do. We just saw her add a new executive order, for example, that early estimates show that her new low carbon fuel standards executive order could increase the price of gasoline at the tank by about 20 cents a gallon. That’s something that she did with a stroke of a pen and she can modify it with a stroke of a pen. There are also changes to the programs that I mentioned earlier that could be done under regulation.

The biggest thing the governor can do when it comes to the regulatory environment is work with the legislature so that they’re not passing off new programs while we’re still figuring out how to implement existing programs. She can talk to them about that.

The other thing is holding her agencies accountable to do these things that we’ve put on the table, like cost benefit analyses, so that consumers know how much a program is going to cost them at the end of the day so that we know what the impact on business will be, or so that we can just study the relative efficacy. None of that is happening and she can direct her agencies to do that with the stroke of a pen, the snap of a finger, whatever you want to put in there.

Miller: I want to turn to transportation. It was one of the most dramatic topics in the legislature last year. First it didn’t pass and then eventually, after in a special session, it did. Then there was an effort to refer it to voters. And very quickly, Democrats, including the governor, said OK, forget it, we’re going to withdraw this and we’re going to come up with yet another version of some way to pay for crumbling infrastructure. Obviously, it’s a business liability too. It doesn’t say to prospective businesses, “I want to increase my investment in the state if the roads are falling apart.”

So how do you approach paying for that work at OBI?

Wilhelms: We have long said that transportation infrastructure is something that businesses and people need to invest in. And we need to be a little better about thinking about it as an ongoing thing, as opposed to something that becomes this massive political fight every handful of years, and the heat gets turned up on that. We are not, per se, opposed to the gas tax or modifications to that, or other ways to fund infrastructure.

The problem we had with that package in particular was really twofold. One, how it was developed. There was not a long conversation with stakeholders about how to bring people together, which is exactly how these things have gotten done time after time after time. And the payroll tax for transit was really a problem for us because, at one breath, they’re talking about how they really care about affordability and want to make sure that they’re working on that for Oregonians. And then on the other hand, they’re raising these taxes that everyone would see come out of their paycheck without a lot of justification. I think it was just really unfortunate that we couldn’t have a broader, better conversation on the front end, with both sides of the aisle in the legislature, with a variety of stakeholder groups. All of that was rushed and not really genuine, and I think we have to get serious about that.

Miller: Angela, thanks very much.

Wilhelms: Thank you for your time.

Miller: Angela Wilhelms is the president and CEO of Oregon Business and Industry, one of the state’s most prominent business advocacy organizations.

I’m joined now by Kyra Buckley. She covers business for OPB. Kyra, good to have you back on the show.

Kyra Buckley: Hello, glad to be here.

Miller: What stood out to you and what you heard from Angela Wilhelms?

Buckley: I think that what Angela started at the beginning with is that Oregon’s economy is struggling for a lot of people and businesses, and I think that that is very true in the reporting that I’ve seen. Whether it’s a small business owner or somebody that works for a large company, it’s rough out there right now. And there’s a lot of reasons why. I think that a lot of what Angela talked about really shows how things are complicated and can get messy. But also the fix, if there is one, or one that can be agreed on, takes time. So I guess I just want to start by saying that everything I heard her say fits with a lot of the reporting I’ve done from folks saying that it’s challenging and they expect it to be challenging for the foreseeable future.

Something that really stood out to me is something that she said that OBI watches, and that’s occupational licensing and how hard it is in Oregon to get licensed for specific professions. I was in Coos Bay at the end of last year and I was chatting with some of the folks at the Coos Bay Hospital about the challenges they’re seeing. One of the things they said is they need dozens more doctors to move to that area. And just to think how hard it is to get licensed for certain professions here in Oregon, but also we know that we need those professionals here to help not just provide those services, but also bring their incomes to the state. And we make it very hard for them to get licensed here as opposed to other states. That really stood out to me.

Miller: What have you been hearing over the last year or so about both Oregon’s economy and its business climate, which are related but not the same thing?

Buckley: Yeah, that’s very true. I think Oregon’s economy, when we’re talking about the unemployment rate, when we’re talking about the workforce, we have been seeing signs that it’s weakening, that things are not going in the right direction – how a lot of economists say it. For the business climate, for how businesses feel about their prospects here in Oregon, if they want to expand or hire people here, it’s not good. Like we heard Angela say, it’s rough. And I also talked to a lot of small business owners, they’re saying it’s hard right now. We talked about the tax burden. If you’re a small business owner, it is hard to pay somebody to do that administrative work and to keep track of the increasing amount of taxes that a business, say, in downtown Portland, has to pay.

In addition to that, it may be hard to provide the pay and benefits to workers that you want, or the hours to workers. So that makes it hard to expand your business, grow your business. And for a lot of small business owners, it puts them in jeopardy of closing. When we look at the actual economy, I follow the unemployment rate very closely. When we looked at November, December of 2024, our unemployment rate was hovering around 4%. It’s steadily ticked up to 5.2% in November 2025. That’s the latest month we have data because of the government shutdown. It’s still a moderately low unemployment rate, but the fact that it keeps going up is alarming.

Miller: What is actually in the governor’s prosperity roadmap?

Buckley: So my colleagues on the politics team have been following this very closely. The roadmap really directs a lot of our agencies and our business leaders to essentially study and hammer out proposals related to things like reducing the tax and regulatory burdens. Our reporting also shows that the governor is planning to introduce a bill in the next session, which starts next month, to reduce red tape and try to speed up development. But we don’t have a lot of details about what that’s going to look like.

Miller: What have you learned about why the governor chose former Republican state senator Tim Knopp as her first chief prosperity officer?

Buckley: It does seem like Knopp was maybe not the first choice, that it was potentially a challenging role to fill for the governor. She may be thinking that it could be a nod to bipartisanship, that it could help bring folks that lean conservative that are in the business community to the table, could help bring folks from the GOP to the table. We will only know as time marches on if that’s true.

But Knopp knows a lot of people in the state. He’s worked with the home building industry, mainly in Central Oregon. He has a lot of relationships that could be very beneficial in this role.

Miller: What kinds of challenges could the governor face as she tries to implement her prosperity plan?

Buckley: I mean, many, many challenges. I think we heard this from Angela at Oregon Business and Industry, but a lot of businesses and residents think taxes are too high. But the state needs tax revenue to do a lot of these economic development programs. Many of us know, Oregon does not have a sales tax. States that do have a sales tax, that’s a pretty stable form of revenue. We are heavily reliant on the income tax, we need businesses to do well and employ people so that they can pay their income tax. But that’s just a more volatile form of revenue, so it’s hard for us to know how much money we’re going to have to work with to try to implement some of these goals that the governor has. And then you can implement something, but is it going to work? Is it actually going to attract business? Is it actually going to lessen the tax burden? We just don’t know.

Miller: Kyra, thanks very much.

Buckley: Thank you for having me.

Miller: Kyra Buckley reports on business for OPB.

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