BUSINESS
A8 • HERMISTONHERALD.COM
WEDNESDAY, NOVEMBER 18, 2020
Increased tobacco tax spells
the end for Cigarette Store
By ALEX CASTLE
STAFF WRITER
Downtown District
possibility for dwindling
returns if the measure is
actually successful in reduc-
ing smokers in the state.
“I continue to be nervous
about a funding source that
is reliant on an activity we’re
trying to reduce,” Fiumara
said. “The more success-
ful we are, the less money
we get. And while we want
that end point, it’s a dan-
gerous way to fund some of
our programs, and so even-
tually there’s going have to
be another mechanism for
doing that.”
Andrea Jackson is the
president of Tobacco Bever-
age Companies, which oper-
ates 67 stores in fi ve Western
states (Oregon, Washington,
Idaho, Utah and Arizona)
including three in Eastern
Oregon.
Jackson said she’s con-
cerned Measure 108 will
hurt her businesses in Pend-
leton, Hermiston and La
Grande, where her stores
primarily sell tobacco and
vaping products under the
name Big Smoke. She said
her stores employ roughly
30 people in the region, but
are hopeful that their stores’
additional sales of beer and
some grocery items will help
offset the reduced tobacco
purchases.
“I hope we make it,”
Jackson said.
While disappointed in
the measure’s passage, Dietz
and his shops already made
the tough decision to close
preemptively before the tax
takes effect on the fi rst of
the new year. But until then,
he’s anticipating the smokers
who have no plans of quit-
ting in 2021 to keep burning
through his product.
“I anticipate these next
two months are going to be
barn burners,” he said. “Then
it’s going to be all gone.”
sient room tax, from the
beginning.
He said the city also
helped provide informa-
tion for a feasibility study
before the project began.
The study indicated a need
for more hotel accommoda-
tions in the Boardman area.
Dayal said people working
in Boardman often end up
staying in Hermiston or the
Tri-Cities instead.
“This is a good oppor-
tunity for them to capture
some revenue for the city,”
he said.
For
more
informa-
tion about the hotel, visit
choicehotels.com/oregon/
boardman/sleep-inn-hotels/
or255.
BRIEF
Sleep Inn opens in
Boardman
A new hotel has opened
in Boardman.
The Sleep Inn, which
opened on Monday, Nov.
9, is located at 125 S.E.
Front St. in Boardman, just
off of Interstate 84 next to
Subway.
Bob Dayal, a managing
partner for the three-story
hotel, said it has 64 rooms, a
gym, a swimming pool and
other amenities. It is part
of the Choice Hotels brand
family.
Dayal said the hotel
received funding assis-
tance from the Port of
Morrow
and
Morrow
County Economic Devel-
opment, and incentives
from the city of Boardman.
The hotel is receiving a
three-year property tax
break through the city’s
enterprise zone, but Dayal
said they will still pay other
taxes, such as the tran-
17 MEN’S DAY
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JB Brick Company
Lucky Endz Gifts
Neighbor Dudes Taproom
Neighborhood Books/Gifts
Nookie’s/Hermiston Brew
Pheasant Blue Collar Bar
Sassafras Flowers by Shera
Sugar Shack
Two96Main
Veg Out
Wild Goose Design
Yo Country Frozen Yogurt
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are up to four times more
likely to become cigarette
smokers.
“When you put a tax on
something, it always reduces
the number of people who
pay for it,” said Umatilla
County Public Health Direc-
tor Joe Fiumara. “We like the
side effect of that because
data is pretty clear that the
sooner you can quit using
tobacco, the sooner your
body can really bounce back
from the side effects of it.”
At the peak of his busi-
ness, Dietz owned six shops
specializing in the sale of
tobacco with additional loca-
tions in Washington and
Idaho that have since closed
as state taxes have risen in
those neighboring states.
Oregon hasn’t raised the
state tobacco tax since 2002,
and a measure most recently
failed to pass in 2007.
In recent years, Dietz
said each of his active Cig-
arette Shop stores averaged
the sale of about 2,500 car-
tons of cigarettes per week,
which he estimated about
80% of are purchased by
Washington residents will-
ing to travel south for the
lower costs. While his stores
also offer beer, Dietz said
those sales only account for
about $150,000 of revenue
per year.
Dietz said the heightened
taxes would result in his
store paying roughly $3 mil-
lion in both state and federal
taxes, which he said can’t
be outweighed by sales due
to the expected reduction in
Washington customers.
Supporters of Measure
108 projected the tax to raise
roughly $160 million in
additional annual funding.
Fiumara is supportive
of directing that funding to
other health programs, but
is also concerned about the
27 BLACK FRIDAY
DEC
Ben Lonergan/Hermiston Herald
The Cigarette Store in Umatilla and its companion store in
Milton-Freewater will both be closing at the end of the year as
a result of increased tobacco taxes.
NOV
Holiday
liday Season
Seas
DEC
After 26 years of operat-
ing in Umatilla County, the
last two remaining Cigarette
Store locations are closing
for good on Dec. 31.
Sherdon Dietz, 79, is one
of two remaining partners
who own the small shops
currently located in Uma-
tilla and Milton-Freewater
that specialize in the sale of
cigarettes and other tobacco
products, which are about to
become more expensive to
purchase in Oregon.
Oregon overwhelmingly
approved Measure 108 ear-
lier this month with two-
thirds of voters voting “yes”
to increase the tax on ciga-
rettes by $2 per pack, along
with adding the state’s fi rst
tax on e-cigarettes and
increasing the tax on pre-
mium cigars.
The heightened rate will
give Oregon the sixth high-
est tax on cigarettes in the
country — a category it cur-
rently ranks 32nd in — but
for Dietz it means cigarettes
in Oregon will become more
expensive to purchase than
they will be across the bor-
der in Washington.
“The immediate effect is
two stores, eight employees
and a $16,000 a month pay-
roll is gone as of Dec. 31,”
he said.
The
funding
raised
through the new tax is almost
entirely earmarked for the
Oregon Health Authority,
which will receive 90% of
the funds for treating sick
people, specifi cally those
facing mental illnesses. The
other 10% will be directed
for tobacco cessation efforts
to tribal governments and
“other culturally specifi c
heath programs.”
Health offi cials are espe-
cially hopeful that raising
prices on these products will
reduce the number of Ore-
gon youth who are pick-
ing up vaping products and
starting habits that result in
them ultimately picking up
cigarettes.
According
to
Ore-
gon Health Authority data,
smoking leads to approxi-
mately 8,000 deaths of Ore-
gonians per year and the
number of Oregon’s youths
who began vaping increased
80% from 2017 to 2019,
while numerous national
studies have concluded that
teens who begin vaping
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ends November
November 30,
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2020
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