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About The Blue Mountain eagle. (John Day, Or.) 1972-current | View Entire Issue (Dec. 2, 2015)
A10 Region & State Blue Mountain Eagle Wednesday, December 2, 2015 ‘B’ corps wince at possible tax exemption By Hillary Borrud Capital Bureau SALEM — Companies that would be exempt from a pro- posed corporate gross receipts tax say the exemption could undermine the reputation of a movement to encourage envi- ronmentally and socially re- sponsible businesses. The union-backed tax mea- sure planned for the 2016 bal- lot would require certain cor- porations to pay a 2.5 percent tax on sales in Oregon greater than $25 million. The measure exempts companies registered with the state as ³bene¿t com- panies.” Legislation passed in 2013 allows corporations to register with the state as ³bene¿t com- panies” in order to put share- holders on notice that the com- pany will not only seek pro¿ts, but will also pursue other goals such as sustainability. These companies are supposed to work with a third party, such as the certi¿cation nonpro¿t B Lab, to assess their opera- tions, and then document posi- tive impacts in annual reports. Registering for the corporate status currently does not affect companies’ Oregon tax bills. The proposed tax exemp- tion generated concern among some proponents of the bene¿t company model, who said it could damage the program’s reputation if the designation becomes popular as a strategy to avoid taxes. “The B corporation move- ment is about having socially responsible companies, not getting tax breaks,” said Tom Kelly, president and owner of the remodeling and custom home construction company Neil Kelly. Neil Kelly is a reg- istered bene¿t company, and Kelly said the exemption could impact “the B corp brand.” “It certainly has the poten- tial to attract companies that will become B corporations whose only intention is to get a tax break, which will dilute the value of the B corp move- ment pretty signi¿cantly,” Kel- ly said. Nik Blosser, CEO of Celilo Group Media and chair of the board at Sokol Blosser winery, said he is also concerned about the exemption. Both business- es are registered bene¿t com- panies. “We certainly didn’t be- come a B corp to get tax bene- ¿ts, and I think that somewhat undermines the point for B corps,” said Blosser, who has not yet taken a position on the corporate sales tax proposal. “If the measure passes, I think we would want to advocate that the Legislature modify that part.” Blosser said the current lack of enforcement by the Secretary of State’s Business Services Division could make it easy for corporations to reg- ister as bene¿t companies to get the tax exemption, without demonstrating positive so- cial impacts. “There’s no one checking to see if you’ve done that,” Blosser said. Ben Unger, executive di- rector of Our Oregon and a chief petitioner on the tax ini- tiative, dismissed the idea that the exemption could provide a loophole for corporations looking for ways to avoid the corporate sales tax. “I don’t think we are,” Un- ger said. “I guess my point is there’s nothing that’s going to stop large, global corporations from avoiding taxes.” Unger said Our Oregon included the exemption in the proposed measure to distin- guish between huge multina- tional companies that avoid taxes and companies that are “doing their best to be a good corporate citizen.” “U.S. corporations are hid- ing $2.1 trillion oversees that they owe taxes on in the U.S.,” Unger said. “But there’s a dif- ference between those folks, those corporate boardrooms, and the small businesses in Oregon that fuel our economy and hire our employees.” Our Oregon is gathering the necessary 88,184 signa- tures ahead of a July deadline to get the measure on the No- vember ballot. State Rep. Phil Barnhart, D-Eugene, said he supports the tax measure, even though lawmakers who passed the law to create bene¿t companies did not intend to create a tax bene¿t. “Most of the compa- nies I’ve heard from, or we’ve heard from collectively, were not asking for a tax bene¿t,” Barnhart said. “They were try- ing to deal with this other is- sue, which is making sure that stockholders know that when you buy shares in this compa- ny, they’re going to be trying to do some other things in ad- dition to trying to make you money.” Barnhart said it is not yet clear corporations would reg- ister as bene¿t companies to avoid the tax, but “I can assure you that if it matters, we will be acting on it, probably in (2017) is my guess.” There are currently more than 700 corporations regis- tered as bene¿t companies in Oregon, according to a state database. However, the state has not tracked the amount of taxes paid by these compa- nies, nor analyzed whether the bene¿t company exemption would cut into anticipated tax revenue. The Legislative Revenue Of¿ce has estimated the tax could generate $2.6 billion an- nually. Robert Manicke, a lawyer at Stoel Rives LLP who spe- cializes in state and local tax law, said companies that sell high volumes of items with low pro¿t margins such as gro- cery stores “would be affected strongly” by the tax plan. Oregon is home to New Seasons Market, the ¿rst gro- cery store chain to be certi¿ed as a “B Corp” by B Lab. Al- though the company has al- ready done much of the work necessary to qualify as a “ben- e¿t company” in Oregon, the grocer has not registered with the state to become one. Staff were unavailable to comment Wednesday, due to the Thanks- giving shopping rush. Calls to government waste hotline at a ¿ve-year high waste, fraud and abuse hotline than in any of the previous ¿ve years. As of Nov. 10, the agency had received 235 complaints, according to audit manager V. Dale Bond at the Secretary of By Hillary Borrud Capital Bureau giv v e e f f r r e e s s h h ! ! NEED A FER? STUF sh a OCKING SALEM — The Oregon Secretary of State’s Of¿ce is on track to receive more complaints this year to the government c ubway 0 . S a e 10 Giv $5 - $ card - ST Gift certificates available! Call to make an appointment first. ATE TIFIC ms R E C GIFT er B loo s tt e B G arde C n ity & John { & rairie 0-3329 2 een P _ Betw ay • 541-8 ____ D ____ ____ _ ____ ____ ____ _ _ _ _ _ _ ____ t For: ____ A Gif ____ ____ _ _ _ _ _ _ _ _ ____ :____ ____ From __ ____ ____ unt:_ ____ Amo ____ Value ____ _ _ : ture p.m. a n 30 ig 5: S - . a.m. • delight • bask • thrill • celebrate • enjoy • • party • happy • bask • thrill • celebrate • e • fun • party • happy • • bask • thrill • celeb 121 S. Canyon Blvd., John Day Phone: 541-575-0782 Fax: 541-575-0783 OBER U OCT IL THR APR OPEN S : 9:00 losed Hours - Fri. •C Sun. at Better Blooms & Gardens Between John Day & Prairie City • 541-820-3329 State’s Audits Division. Em- ployees still have to go back to remove any duplicate com- plaints, but the highest number of complaints in the last ¿ve years was 184 complaints in 2010, according to an email from Bond. The lowest number of complaints during that period was 145 complaints in 2012. Molly Woon, a spokeswom- an for the Secretary of State’s Of¿ce, said employees believe the increase in complaints to the hotline might be connected to Gov. Kate Brown’s message to state employees in March, in which the governor asked employees to speak up if they observe problems. Brown in- cluded a link to the web page for the government waste, fraud and abuse hotline. “We think this is at least in part due to the Governor’s intro- ductory email to state employees in March ... and her highlighting the hotline program in her new Wood Stove Bricks or Pellets Happy Holidays to All! to keep you and your family cozy this winter Buy by the Bundle, or pallet Check out in-stor e discou nts! Behlen Livestock Equipment 4 4 CHS Payback & Nutrena Feeds 4 Wide Variety of Tack 4 Pro Pac Dog & Cat Food 4 Fencing Supplies: Treated Posts & T’s 4 Implements & Parts 4 Baling Twine Keystone Barbed Wire 4 & Rolled Wire 4 Headgates & Irrigation Supplies 4 Cargill Salt 4 Smart Lic Dealer 4 Bass Fishing Supplies 4 Straw & Hay P et Supplies & 4 Dog Houses 4 HW Brand livestock equipment 4 Powder River Dealer 4 Bear Mountain Wood Pellets 4 Backwoods Water Troughs GIBCO AG & INDUSTRIAL 311 N. 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In her message to employees in March, Brown highlighted the response of employees at the state data center who questioned a request from a staffer in former Gov. John Kitzhaber’s of¿ce to delete Kitzhaber’s emails. “I believe the staff members at (Department of Administra- tive Services) who were not comfortable with what they be- lieved they were being asked to do by Gov. Kitzhaber’s of¿ce responded correctly by notify- ing their supervisors, and the agency’s decision to suspend further action was appropriate,” Brown wrote. “I appreciate the good judgment these individuals demonstrated as well as the in- vestigative work that is bringing important information regarding these events to light.” Statistics on the outcomes of the complaints were not avail- able on Wednesday, but they can vary widely depending upon the incident. For example, a 2014 com- plaint that Oregon Parks and Recreation Department employ- ees had not properly recorded work absences was referred to the parks department for an in- ternal investigation. The inquiry revealed that two employees speci¿cally identi¿ed in the complaint — HR director Tasha Petersen and HR analyst Susan Kirschenmann — had record- ed on their timesheets that they worked hours when they were actually out of the of¿ce for va- cation or sick leave. Earlier this year, a complaint to the hotline prompted auditors at the Secretary of State’s Of¿ce to investigate the Department of Energy’s handling of renew- able energy and ef¿ciency tax credits. Auditors ultimately concluded that the Department of Energy never publicized a 2012 decision to allow people to ignore price regulations on the sale of energy tax credits, so few ¿nance ¿rms knew they could negotiate such deals. Brown re- sponded to the ¿ndings by call- ing for a review of the Depart- ment of Energy. This holiday season, don’t let aches and pains slow you down. Our holistic, hands-on approach to healing can put an end to chronic pain Make check payable to Blue Mountain Hospice Call today to make an appointment Send acknowledgment of this gift to: Name: __________________________ Address: ________________________ City/State/Zip: ____________________ PLEASE SEND CONTRIBUTION TO: Blue Mountain Hospice 170 Ford Rd., John Day, OR 97845 02939 541-575-1063 Blue Mountain Chiropractic HEALTH CLINIC 155 NW 1st Ave. • John Day