2 perspectives on bipartisan bill that would hike Oregon lodging tax to help wildlife

Lawmakers are meeting in Salem to discuss and decide the fate of a flurry of bills during Oregon’s short legislative session this year. One of those is a bipartisan bill that would hike the state’s lodging tax at places like campgrounds, hotels and Airbnbs from 1.5% to 2.75%.

The tax increase is expected to raise tens of millions of dollars for wildlife protection, habitat conservation, anti-poaching efforts, combating invasive species and mitigating wildfires. It would also compensate ranchers for cattle killed by wolves.

The bill’s sponsors, Rep. Mark Owens, R-Crane, and Rep. Ken Helm, D-Beaverton, join us to share why they support it and why they revived it this year after it died in the final days of last year’s session. Jason Brandt, president and CEO of the Oregon Restaurant and Lodging Association, also joins us to share his opposition to the bill.

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

Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. If a bipartisan group of Oregon lawmakers have their way, the state’s lodging tax would be increased to bring in more revenue for wildlife protection, anti-poaching efforts, invasive species mitigation and other conservation efforts. More funding would also go to compensate ranchers whose cattle were killed by wolves. The current statewide lodging tax is 1.5%. It would nearly double, to 2.75%.

In a few minutes we’ll hear from the president and CEO of the Oregon Restaurant and Lodging Association. His group opposes the bill. First, I’m joined by its two sponsors. Ken Helm is a Democratic state representative from Beaverton and Cedar Hills – that’s District 27. Mark Owens is a Republican state representative from Baker, Grant, Harney, Lake, Malheur and part of Deschutes counties – it is massive District 60. Welcome to you both.

Ken Helm: Thank you. Nice to be with you.

Miller: Representative Helm, first – how long have you been pushing for a bill like this one?

Helm: Dave, I’ve been working on this for about 10 years. I was part of a task force that met in 2015 to attempt to figure out ways to close a budget gap at the Department of Fish and Wildlife, and I’ve really been working on the issue ever since.

Miller: Why? What’s driving you?

Helm: We have needs to manage non-game wildlife. These are all the species, 300 or so species that are not hunted or fished for. We have a strategic wildlife action plan that is meant to manage these species and make sure that they don’t become threatened or endangered under the Endangered Species Act, and we’ve never been able to fund it. On the other side, hunters and fishermen have been footing the bill at the Department of Fish and Wildlife for decades and decades through their fishing and hunting license fees.

Miller: Representative Owens, you have voted against a lot of tax increases over the years. Why do you support this one?

Mark Owens: Great question, Dave. First of all, I support this tax and I do not believe it’s gonna hurt tourism, especially in Eastern Oregon. If I thought by any means it would, I would not be here, because those restaurant and lodging owners are also small business owners. But the majority of my small business owners in my massive district, as you said, are farmers and ranchers, those that make a living off the land. And what we’re learning is we continue to have increased wolf numbers, we continue to increase predation. We have passed a policy in ‘25 that sets out to help some of those ranchers coexist with wolves, but we haven’t found an adequate way of funding it.

This does adequately fund wolf compensation and also brings people to our communities for tourism that want to see robust outdoor activities.

Miller: Often the Republican take when it comes to questions about tax increases in particular, state budgeting broadly, is that we have a spending problem, not a revenue one. Why do you see this particular issue differently?

Owens: Yeah, good question. If I was in charge, I would give our natural resource agencies more than 2.7% of the general fund and we wouldn’t be having this conversation today. But I’m not. And Representative Helm and I have been trying to bring more funding into our natural resource agencies. We’re not successful. So if you’re not successful in what you’re trying, you have to try something else.

So this is a tax. I take no tax vote lightly. But it supports my communities and it supports tourism. So therefore I’m willing to go there because we haven’t found a different way.

Miller: Representative Helm, some bills raise revenue without a lot of specific allocations. In this case, you do list a number of specific programs that will get some of this new revenue. How did you decide which programs should get this new money?

Helm: When we went about creating the bill, we worked it backwards. We asked the Department of Fish and Wildlife, what would it take to stand up a program to do the fish and wildlife regulation that the state wildlife action plan requires? So they built us a budget to do just that, and it’s very discreet, as you say. And when we determined that the wolf compensation plan needed to be part of our overall program, we once again built it from the ground up, and asked both our Department of Agriculture and members of our wolf compensation committees around the state, what do you think you really need? And that came to a number.

Then there were ancillary programs that feed into the non-game species management, like anti-poaching, invasive species, the Oregon Conservation and Recreation Fund. So those also have a small budget item dedicated. Then lastly and very importantly, we needed to find a way to fund the Oregon Conservation Corps in some of their work. Not all. And so there is 0.1% dedicated to providing them a budget, because they will do some wildfire suppression where it overlaps with wildlife habitat management.

Miller: As I mentioned, we’re going to be talking with the head of the Oregon Restaurant and Lodging Association in just a few minutes, but I know that you’re both very familiar with their basic argument against this bill, which is that raising this tax now will make Oregon less competitive in terms of tourist dollars, or convention dollars, especially at a time when there’s a lot of concern about Oregon’s overall competitiveness in terms of its business or taxation environment.

So Representative Helm, first – what’s your response?

Helm: We were very careful to pick a type of tax that would be the lowest burden on Oregonians. So just to be specific about the transient lodging tax, this is a pass-through tax. This is not a tax on the hotels. They get a small administrative fee actually for gathering the tax from their customers. Of those customers, about 63% of those are from out of state. And Travel Oregon themselves have data that indicates that about 90% of travelers to Oregon come expressly to enjoy our nature, our outdoor spaces, and participate in some sort of wildlife activity. So this is a chance to get out-of-state visitors to pay for some of the impacts that they have on our environment.

The remaining amount that Oregonians would pay as they go around visiting places in the state is, on an average overnight stay, somewhere between $1.25 and $2.50. And we feel that that is not a substantial burden. It’s also not one of the cost of living issues that we’re all concerned about. This is not affordability. This is all wrapped up in people’s travel budgets, which we know are a separate line item on most people’s budget. It’s fairly low and the payoff will be extensive. So we think it’s worth the trade-off.

Miller: Representative Owens, I’m curious about what we heard from your colleague just now about how this money is gonna be going to further some of the very things people are coming here to do. If dentists come for a convention at the Oregon Convention Center, or there’s Airbnb stays in Jackson County for the Shakespeare Festival, are you really arguing that the new money they’d be paying that would go to anti-poaching efforts or rancher reimbursement after wolf predation, that there’s a real connection there?

Owens: Yeah, 100% Dave. I believe there’s a real connection. And I’ll talk more comfortably about events that happened in Eastern Oregon because the two you referenced don’t happen in Eastern Oregon. Most of the recreation that comes into my communities is for hunting, fishing, outdoor recreation. Just on outdoor recreation, ODFW and the outdoor economy contributed $15.6 billion in consumer spending. So those folks travel into my district to enjoy the outdoors. This bill and the funding that comes from this bill not only helps my small producers, but helps a more pleasant outdoor and a more pleasant experience.

The last thing I’ll say is double down on what Representative Helm said. If this was going to increase the cost of living to the average Oregononian, I would not be supporting it. This is a tax. No tax vote is easy. But this bill does not increase the cost to the average Oregonian.

Miller: Representative Helm, last question to you. A similar bill passed in the House last session but did not make it to the finish line in the Senate. Do you have reason to believe that this year is going to be any different?

Helm: Yes, we do. Last year we had the votes in the Senate. We moved from the House where we had more votes than we needed on the tax vote. We were on our way, it was late in the session, and a procedural move was made by one of the senators to file a minority report and run out the clock. So we just ran out of time. That’s unfortunate because if the Senate had been able to vote, we were confident that they would have passed the bill.

We’re bringing back substantially the same bill this time, and one that does not propose an increase in the transient lodging tax over and above the bill that we brought last time. Very similar bill and we’re very optimistic.

Miller: Ken Helm and Mark Owens, thanks very much.

Helm: Thank you.

Owens: Thanks, Dave.

Miller: Ken Helm is the Democratic state representative from Beaverton and Cedar Hills. Mark Owens is a Republican state representative from Eastern Oregon.

Jason Brandt opposes the bill. He is the president and CEO of the Oregon Restaurant and Lodging Association. He joins us now. It’s great to have you on the show.

Jason Brandt: Thanks for having me in the studio, Dave. Great to be here.

Miller: Why are you against this bill?

Brandt: For a variety of reasons. Number one, this is a $38 million tax increase, at a time when I think there’s bipartisan opposition to any tax increase proposals, given the very issues you were mentioning a moment ago, Dave. This is not a good time to be in business in Oregon. The headwinds are fierce. Other states are getting much more competitive when it comes to group business, finding really creative ways to attract new conventions, conferences, festivals to their communities to churn their local economies, create the multiplier effect that these dollars are designed to create.

Also, within that $38 million tax increase is an $11 million tax increase on Oregonians. So $11 million of the $38 million would be paid by all of us traveling around the state with our friends and family, or going to a business conference inside the state as we stay overnight.

Miller: I’m curious about your take on that part because as we heard just now from Representatives Helm and Owens, they did acknowledge that around two-thirds of this would be paid by non-Oregonians. And then essentially what they’re saying is for the other 38% or whatever it is, they were saying that because this is largely traveler tourism, they don’t see it as a cost of living increase. I guess they didn’t use this word, but what I imagine their argument is is more of a luxury tax. How do you respond to that?

Brandt: I acknowledge the arguments that have been made about, for some of us that are just traveling leisurely, this amounts to a cup of coffee. We’ve heard those arguments before and that really has never been our concern. Our concern is the bigger dollars, the bigger splash that creates a much more exponential return on investment for our local economies through group travel.

Miller: Like conventions, for example.

Brandt: Exactly. Another talking point that didn’t come up right now on the show so far is that Oregon currently has the third lowest statewide lodging tax in the country, which is something that we readily admit, something that proponents have been bringing up. But that’s a disingenuous argument, because the way our lodging taxes work in Oregon, they’re stacked on top of each other. So looking at the statewide lodging tax rate kind of myopically, without the consideration of the city and the county taxes, is disingenuous to the policy debate that we have in front of us.

So for example, in Portland, we have 16% total tax rate. If we increase this tax, it becomes 17.25%, which makes us the second highest lodging tax on the entire West Coast, only behind Seattle at 18%. If anyone out there is listening and you think times are good for conferences in Portland, I’d love to talk to you. They are certainly not. And the last thing we need to do is shoot ourselves in the foot with an economic development investment that’s meant to churn our local economies and bring more visitor dollars into our communities, so that our local governments have more money.

Miller: I spent a little bit of time this morning trying to figure out, when you combine local, state and perhaps sales taxes altogether for short-term accommodations in various comparable cities, what they were. It’s actually not the easiest thing to do to get reliable data. But from what I could tell, even if this statewide tax were increased, Portland would then still be in the neighborhood of other, seemingly comparable cities. You mentioned Seattle as one. Salt Lake City, their all-in number seems to be around 16%. In Austin, it’s around 17%. Denver, it’s about 15% or 16%. I think it’s fair to say that in parts of the coast it’s similar, that they also have a sizable local lodging rate.

How big a deal would it be if these popular Oregon tourist destinations had hotel lodging taxes that were around what these other cities currently are?

Brandt: Our friends at Travel Portland who do this work day in and day out, they’re the ones that are on the phone, they have sales teams that are calling trying to convince folks to bring their dollars and their patrons here to Oregon and to Portland for their conferences. Those are the folks that I trust from an expert standpoint. And they’re telling us right now, where our current tax rate is at 16%, is about as high as we can be to stay competitive in the existing environment as we continue to work on building our reputational reality in Portland and the surrounding state

Miller: Because you see those as connected. It seems like you’re saying you can’t just talk about the lodging tax rate without talking about the reputational hit that Portland and Oregon have taken in recent years.

Brandt: Yeah. We have over six hotels, some of our most iconic hotels, that are in receivership right now, where the banks have taken back the keys to the hotel. We are at a historic point in the history for our industry in the current situation. So you can imagine what happens if we have national headlines that say Oregon chooses to nearly double its statewide lodging tax, a phrase you used to introduce the segment today. That does nothing to help us get back on track with our economic development goals in this state.

Miller: I did say nearly double. You could also say Oregon is set to increase its lodging tax by 1.25%. It doesn’t sound as scary if you say it that way.

Brandt: It certainly does not. And I think it’s our job as experts for the tourism and hospitality industries to make sure we are providing color to tax rate changes such as 1.25% that provide very little understanding or perspective as to what that actually means.

Miller: You have been very clear that you think this is a particularly bad time to increase the lodging tax. But if you’re speaking frankly, can you imagine any time when your association would be in favor of such an increase?

Brandt: Absolutely, and we have been in the past, which is something we had the pleasure of sharing with the House Revenue Committee last week during the public hearing. This tax was actually initiated by the industry back in 2003. In partnership with Governor Ted Kulongoski at the time, our association, in partnership with other stakeholders involved in the process, passed the Oregon Tourism Investment Proposal to initially establish a 1% sales tax, in a state without a broad sales tax, on our businesses so that we could create a more formidable Travel Oregon. And the results are astounding. If you look at what we’ve accomplished over the last 23 years, visitor spending has doubled. The tax revenue generated by visitor spending for our local governments and for state government has tripled. And we’ve created 35,000 direct new jobs in the tourism industry. It’s an undeniable return on investment.

Miller: How do you figure out what the tax is responsible for, as opposed to just what Oregon and its natural and human splendors are responsible for?

Brandt: Well, it has everything to do with having a laser-like focus on trip ideation, and getting the message out about all the things we have to offer and what those strengths are in comparison to other states.

Back to the original question, we established the tax in 2003 at a rate of 1%. We agreed to increase the lodging tax to 1.8% from 2016 to 2020 to bring the World Track Championships to Hayward Field, which was an astounding success. And then on July 1, 2020, the tax went from 1.8% back down to 1.5%. So this tax, initiated by the industry – which has also supported tax increases in the past – believes that if we take our laser-like focus off of this dedicated economic development revenue stream and for the first time ever open it up to five new beneficiaries that have never had access to this stream, we will certainly set up a perpetual struggle between agencies fighting for this money over and over again, as far as we can see into the future.

Miller: So then let me give you a chance to respond to some of the last points that Representatives Owens and Helm are making. I did bring this issue up to them, the extent to which they see conservation efforts as being reasonable efforts to fund using this particular taxing mechanism. And as you heard, they said yes indeed, because there’s a connection between tourism and conservation, hunting or appreciation of the natural world, it makes perfect sense to use lodging tax dollars for those efforts. What’s your response?

Brandt: So, first and foremost, I really appreciate and respect the work that both Representative Owens and Representative Helm have been doing to support wildlife or natural environments. I happen to be a backpacker in my personal life, Loowit Loop around Mount Saint Helens, Timberline Trail, the Steens Mountains. I love our nature, I love everything Oregon provides. So I’m very grateful and respect their civic service.

What I am most concerned about, and I think your listeners should be concerned about, is our inability to control spending, like we all have to do in our household budgets. I’m looking here at a sheet with Dave from Oregon Business and Industry, one of our friends in the business world out there in Oregon working hard to make sure small businesses can be successful in this state. We’re looking at a sheet that shows Oregon’s general fund growth from 2015 to 2025. Since 2015, so the 2015-2017 biennium all the way up to our current 2023-2025 biennium, which includes the latest revenue forecast, our general fund growth in this state has grown by 77%. And then the projected revenue from 2025 to 2035 is projected to grow 66%.

So if you’re telling me that our farmers and ranchers, who do need a wolf depredation funding … and we certainly feel for those small businesses and want to support them, they’re a part of our food chain, our cycle, and we deeply respect them, as well as those working for our environment and our natural resources. If you’re telling me that the Legislature over the last 10 years has more general fund money, it’s 77% higher over the last 10 years, and over the next 10 years in the future it’s going to be 66% higher, how do we not have money to get these projects off the ground in the way that they’ve been funded in the past?

Miller: Jason Brandt, thanks very much.

That’s Jason Brandt. He is president and CEO of the Oregon Restaurant and Lodging Association.

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