• Bend Business Roundup 1-17-20

    By on January 17, 2020

    Happy Friday,

    After a nearly two-month hiatus, the Bend Business Roundup is back. The emphasis in weekly(ish) is on the (ish), you see.

    Business: According to something called CloudKitchens, the Bend-Redmond metro area has the second-highest rate of self-employment among small cities in the U.S. Over 20% of workers here are self-employed, twice the national average. Self-employed folks make, on average $50,000 nationally versus $48,000 who are employees. Longtime readers will recall that we track and report on new business registrations in Bend, which are consistently the highest per capita in the state of Oregon. More self-employed folks means more business registrations.

    Law: If you’re self-employed, which is to say that you (or the company you own or work for) contract out services to other people or other companies, the truth of the matter is that unions and many Salem policymakers don’t like you very much. Well, they would say that they like you and probably like you better than you like you because they know better than you how you should sell your services.

    The state and unions don’t like independent contractors because these folks don’t pay unemployment insurance or workers compensation and they don’t withhold taxes. They are also largely immune from unionization efforts. During last year’s legislative session, unions and their allies were nearly successful in passing a bill that would have made it even more difficult for self-employed people to freely contract to sell their services by, among other things, re-defining employees to include anyone who provides services to someone else who more or less provides the same services. Many if not most real estate agents, construction contractors, hairdressers, truckers and many other professions would be impacted and forced to dissolve their businesses and become employees. The language of the bill was so broad that even my law firm could be prohibited from performing business law services to another law firm, because we’re all lawyers. Or doctors treating other doctors, I suppose.

    The self-employed are not asking for this “protection” and the “protection” would disproportionately hurt people in Central Oregon, who have found, in very high numbers, that self-employment is the best way to use their talents. Unfortunately, the legislature is likely to take the bill up again in next month’s legislative session. The legislature should reject it again.

    Politics: Oregon House Speaker Tina Kotek recently mentioned that she might seek to declare homelessness an emergency in the state. The primary effect of such a declaration is that it would allow cities to more easily site homeless shelters without jumping through Oregon’s famously restrictive zoning and other land use laws. Kotek’s proposal joins a growing list of recent exceptions to the state’s land use system: affordable housing and urban growth boundary expansion in the western Portland suburbs, child care centers, to name a few recent examples.

    The proliferating exceptions demonstrate just how pervasive are the effects of our land use system. The system makes it very hard to construct and site most anything. The exceptions arise when that “anything” is politically palatable enough to get the legislature’s attention, but most frustrated uses are below the surface. If you believe that the legislature knows what is best for us, our families and our communities, this system is fine but if you believe the legislature doesn’t and actually can’t know that due to the complexity at issue, then the system needs a reset.

    Et cetera:  If you’ve ever wondered what George W. Bush, Barack Obama, Kim Jong-un, Richard Nixon or Vladimir Putin would look like with a man bun, you’ve come to the right place, my friends.

    Your friends can sign up to receive the Bend Business Roundup here. No sales, no spam. Just the weekly email you’ve come to know and love.

    Have a great weekend!

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  • Bend Business Roundup 11-22-19

    By on November 22, 2019

    Happy Friday,

    Here’s some stuff you might like.

    Business: Let’s try a multiple choice question. Bend has the fourth highest concentration by population of which of the following, compared to other U.S. cities:

    a. Ford Raptor pickup trucks
    b. Blockbuster video stores
    c. Puffy jackets
    d. Dudes with tattoos of evergreen trees on their forearms and/or calves
    e. AirBnB rental units
    f. a, b, c and d

    If you answered  a, b, c, d or f you’re wrong because we’re number 1 in all of those (or at least we are with b and I can’t imagine anyplace has more of a, c and d).  If you answered “e” you’re correct – Bend has 1,658 AirBnB vacation rental listings per 50,000 residents, the fourth highest concentration in the U.S.

    Law: A Linn County jury has awarded thirteen counties and 150 additional taxing districts (like school districts etc.) $1.1 billion in damages in the districts’ breach of contract claim against the State of Oregon. The districts contended that they transferred timberland to the state in 1941 in exchange for a promise that the state would maximize timber harvest value on the land, a portion of which would be paid to the districts. State forestry practice changed in the late-90s to prioritize environmental and recreational uses, and timber revenues fell. The state has indicated it may appeal the judgment.

    The amount of the verdict is shocking: Tillamook County, one of the plaintiffs, alone stands to receive $330 million if the verdict is upheld, nearly $13,000 per resident. Now let me really blow your mind. That $1.1 billion – only these particular taxing districts’ share of revenue derived from a subset of state-managed forest land – represents only a tiny fraction of the economic harm experienced by rural Oregonians due to changes in state and federal timber policies since the 1990s.

    If anyone has seen actual estimates, I’d be interested in seeing them. I’d wager, though, that the total economic loss due to reduced timber harvests to taxing districts, state government, the federal government, private businesses and families located in rural Oregon must rank among the largest economic disruptions caused in material part or in whole by government policy in the history of the United States, other than war.

    That’s not to say I think public lands policy should be solely focused on timber harvests. It’s also not to say that there have not been economic benefits from a more diverse public lands policy, but it is a reminder of the enormous scale of economic and social trauma experienced by recent generations of rural Oregonians. Entire communities have been hollowed out, all across the state. State and federal timber policy changes played a big (not the only, but big) role in causing that. The verdict in the taxing districts’ lawsuit is a reminder of the cost to Oregonians of swinging the balance of of land management too far away from sustainable timber harvests.

    Politics: In peacetime and with a relatively robust economy, our federal government has spent in 2019 nearly $1 trillion more than it’s taken in. The path of growth of our federal debt is unsustainable and we are saddling our kids and grandkids with the bill for our extravagance. This scenario can’t continue and will end either in a manner of our choosing or in a manner of our creditors’ choosing. The former would be preferable.

    Et cetera: We’re in Portland visiting friends for the weekend and we’re probably going to the Evergreen Aviation and Space Museum in McMinnville on Saturday because we like big planes. We’re not doing the water park, just the museum. If you’ve been and have any tips relevant to two families of harried parents and their kids between three and five years old, let me know!

    Your friends can sign up to receive the Bend Business Roundup here. No sales, no spam. Just the weekly email you’ve come to know and love.

    Have a great weekend!

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  • Bend Business Roundup 11-15-19

    By on November 15, 2019

    Happy Friday,

    Here’s some stuff you might like.

    Business: It’s common knowledge that in the latter portion of the 20th century, Bend’s economy turned from timber to tourism, right? Not so fast says Damon Runberg of East Slope Economics: he writes that employment based on tourism has held relatively steady compared to population since 1990 (when timber was still a big deal here). Per Runberg, what’s replaced the timber jobs has mostly been construction and, more recently, professional services which includes lawyers so, yeah, you’re welcome.

    Law: You’ll recall that the Oregon legislature passed something called a Corporate Activity Tax which is actually a tax on almost anyone (not just corporations) who sells $1 million or more of stuff or services in Oregon in a calendar year. Businesses need to comply by January 1, 2020, but the Oregon Department of Revenue likely won’t have even temporary rules out by the beginning of the year, and no permanent rules until the second quarter. Deloitte has an informative piece on the status of the tax.

    Politics: Back in 2016, the Bend City Council passed a resolution professing concern about climate change and forming a committee to, among other things, “identify opportunities for the City to encourage and incentivize businesses and residents, through voluntary efforts, to reduce [greenhouse gas] emissions and fossil fuel use.” (Emphasis added). The inclusion of the phrase “through voluntary efforts” was not accidental – it was purposeful on the part of a Council that was concerned about criticism that the resolution was the first step toward sweeping and expensive city regulations of private and business activity.

    Fast forward to now. That committee has released a 108-page Community Climate Action Plan. Back on page 27 is the following proposal: “Implement a Home Energy Score program that requires every home to be scored on its energy use and energy efficiency at time of listing.” (Emphasis added).

    There’s something about requiring voluntary efforts that is, well, appropriate for our political age. What’s more, if the Council does approve the home energy score mandate, it’s people who want to sell their home who foot the bill for obtaining the score. In Portland, which you will be unsurprised to learn has a home energy score mandate, it costs $150-$250 to obtain the score. Either the seller eats that cost or passes some or all of it to the buyer, which has the impact of making buying and selling homes in Bend more expensive. That is in conflict with the Council’s goal of fostering affordable housing.

    The worst part is that, despite its expense and hassle, the home energy score mandate wouldn’t affect the climate in Bend one bit. That’s because Bend’s contribution to global greenhouse gas emissions is so miniscule that even if it stopped producing greenhouse gases completely, there would be no perceptible change to the climate (even Oregon’s statewide cap and trade bill would have had only a “negligible” impact on global greenhouse gas emissions).

    That’s not to say the city and all of us shouldn’t take reasonable and cost-effective steps to curtail greenhouse gas emissions, but the home energy score mandate is costly, intrusive, and contrary to the voluntary nature intended by Council for the Climate Action Plan. The City Council should not mandate a home energy score, but instead leave it to buyers and sellers to determine what type of energy analysis they want, if any.

    If you’d like to weigh in with city councilors on the home energy score mandate, you can go here and learn how to contact them.

    Et cetera:  Bend’s Mountain View High School has produced some remarkable athletes. Ashton Eaton won two Olympic gold medals in the decathlon, and also set the world record in that event. In 1991, as a sophomore at MVHS, I was a member of a JV 4 x 100 meter relay team that had to run in the girls’ race because there weren’t enough lanes in the boys’ race. Our team quickly developed a laser-like focus born of adolescent fear of public embarrassment. We never ran so fast and it was the only race we won all year. Like I said, remarkable athletes.

    Added to this pantheon of former MVHS athletes is Jacob Hollister. Hollister quarterbacked the state champion Cougars in 2011, winning statewide player of the year honors. In college, he switched positions to tight end, and then played for the New England Patriots and now the Seattle Seahawks in the NFL, where he just might be a star. A couple games ago, Hollister caught the walk-off game-winning overtime touchdown pass from Russell Wilson. On Monday night against the 49ers, he caught a critical third-quarter TD with one hand while enduring almost comically flagrant pass interference. Great to see Hollister playing such a key role for the ‘Hawks.

    Your friends can sign up to receive the Bend Business Roundup here. No sales, no spam. Just the weekly email you’ve come to know and love.

    Have a great weekend!

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  • Bend Business Roundup 11-08-19

    By on November 8, 2019

    Happy Friday,

    Last week, I promised the usual Bend Business Roundup format would return this week but I am here to tell you that I lied. I’ve been semi-obsessed this week with the story of an 18-year-old Powell Butte resident who died in the Korean War. With Veterans Day coming Monday, I wanted to spend more than a couple paragraphs on the remarkable story of Corporal Norvin Brockett.


    Norvin Brockett was born February 7, 1932 to C.W. and Zortha Brockett of Powell Butte, Oregon, about 25 miles northeast of Bend. The population of all of Crook County in the census year of 1930 was only 3,336 (compared to around 23,000 now). He attended Crook County High School in Prineville before enlisting in the Army in 1949 or 1950 at the age of 17. Because he was a minor, C.W. and Zortha had to sign his enlistment paperwork. Corporal Brockett was assigned to Battery A, 57th Field Artillery, 7th Infantry Division.

    On June 25, 1950, the Korean War began when North Korean troops, supported by the Soviet Union and China, surged into South Korea. South Korean forces and their recently arrived American allies barely fended off the surprise attack, retreating to a small area at the very southern tip of the Korean peninsula. General Douglas MacArthur, with heavy American reinforcements, launched his own surprise amphibious counterattack at Inchon, and the tides turned. By November 1950, American troops were near the Yalu river, which separates North Korea from China, and American and South Korean forces were executing a series of attacks designed to end the war by Christmas.

    For Norvin and most of the rest of the 7th Infantry Division, the war would in fact be over by Christmas, but not due to American victory.

    At the outbreak of the war, the 7th Infantry Division was mustered near Mt. Fuji in Japan, which was still under American occupation following World War II. Assuming Brockett was already with the unit, the snow-covered volcanic Mt. Fuji might have reminded him of the sweeping western views from his home town on the high desert of Central Oregon.

    With war underway, the 7th Infantry Division was dispatched to the Korean peninsula. The unit took part in the Inchon landing, and in late November 1950 was located near the eastern banks of the Chosin Reservoir, in North Korea, near the Chinese border. The Chosin Reservoir is at an elevation of 4,265 feet, and is far enough north to be quite cold, and it was very cold in November 1950, with low temperatures below zero degrees.

    By then, Brockett was definitely with his unit with their 105 mm howitzer cannons. Despite the freezing temperatures, morale should have been high, as troops looked forward to ending the war and being home for Christmas.

    Then, on the night of November 27, Chinese troops surprised the American forces with a massive attack. Around 30,000 American and allied troops (nicknamed “the Chosin Few”), including Brockett’s unit, were encircled by 120,000 Chinese. The fighting on the eastern side of the reservoir was especially intense as the battle extended for 17 days, with American units suffering such high casualties that they were essentially erased.

    Brockett’s Battery A was one of the units taken by surprise the night of November 27. This photo shows the location of the unit the next day, with the bodies of American soldiers still in their sleeping bags where they had been killed by the Chinese the night before.

    Brockett survived the initial surprise attack but was killed on or around December 2, still near the Chosin reservoir. Sitting in my comfortable office writing this, it is difficult to imagine the sheer terror that Brockett must have endured between the night of November 27 and his death likely a week later. The official records state December 6, 1950 as the date of loss, but that was really just the date that his unit was finally able to assess who was still around and who wasn’t: “due to the internal chaos within the unit due to high losses, it is impossible without eyewitness confirmation to have a specific date of actual loss.” Brockett, 18 years old, died in the freezing cold near a reservoir in North Korea, and anyone who might have witnessed his death was dead too.

    A shocking 88% of Brockett’s and other units around Chosin were killed, wounded or captured.

    Brockett’s remains were not recovered, at least not by the Americans, and the U.S. government declared him presumed dead on December 31, 1953. Brockett’s family was surely left with grief tinged with the uncertainty of the word “presumed,” for 65 years. Then, on July 27, 2018, following a summit between President Donald Trump and North Korean leader Kim Jong-un, the North Korean government gave the U.S. government 55 boxes with remains of American soldiers from the Korean War. The remains of one such box were those of Corporal Norvin Brockett. Either the Chinese or North Koreans had been in possession of the remains since December 1950.

    Now, nearly 70 years after his death, Brockett’s remains have been returned to American soil. He will be buried at Arlington National Cemetery.

    Brockett’s story is a reminder of the unimaginable things our country has asked 18-year-olds to do in the most impossible conditions in the most inhospitable locations around the planet. Brockett’s sacrifice came at the midpoint of a century in which human beings around the world faced conflict after conflict which pitted civilizations and ideologies against each other in global death matches. Many of the participants of those wars were practically (or sometimes literally) children.

    Each one of us reading this today is blessed to live in a time of unprecedented relative peace. That peace was won via the efforts of Norvin Brockett and many others like him who have stood up to those whose goal it is to enslave people. It is not an accident that the flame of liberty burns brightly in South Korea but not North Korea. For Americans, it is so easy to forget that self-governance and freedom are the exception to the rule of brutal authoritarianism in human history. History tells us that earlier experiments in liberty all succumbed to the inertia of authoritarianism, often embodied by external threats.

    Even in this time of relative peace, eighteen-year-old Americans are still today fighting and dying for us in places like Afghanistan. There will be new threats and periods of relative peace by definition do not last. To know what must sometime again be done to preserve our unique heritage of freedom from those who would enslave us, we must remember and honor those who have fought for us before. Rest in peace, Norvin Brockett.

    You can sign up to receive the Bend Business Roundup, which is actually about business and/or Bend sometimes, each friday by going here. I won’t try to sell you anything and sure won’t give your email address to anyone else.


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  • Bend Business Roundup 11-01-19

    By on November 1, 2019

    Happy Friday,

    I’m doing something a little different this week. Congressman Greg Walden announced this week that he won’t run for re-election and will retire when his term concludes next year. Walden’s announcement is a big deal for me personally, for Bend and the rest of Oregon’s Second Congressional District, and has implications for our national politics too. This week, I’ll focus on that stuff.

    The usual BBR format will return in all its glory next week!

    I’ll begin with acknowledging that I am biased with regard to the issue of Congressman Greg Walden. I worked for him during most of his first term in the House. Greg was a great boss. He is a highly effective legislator, and he’s been personally very kind to me. I wouldn’t be doing what I’m doing right now if not for him (so you can blame him). So, yeah, I’m biased.

    I don’t think there’s much of a question that Greg Walden has been Oregon’s most effective and influential member of Congress of either party and of House or Senate since the departure of Senators Mark Hatfield and Bob Packwood in the mid- to  late-90s. He’s had an enormous impact on forest management practices, telecommunications laws, and, frankly, the number of Republican members of the House through the 2018 election. He’s chaired one of the most powerful committees in Congress – House Energy and Commerce, served in leadership, and chaired for two successful election cycles the National Republican Congressional Committee, which helps Republicans get elected to the House. All the while, he’s maintained an almost constant presence throughout his massive district and sailed to comfortable re-election to comfortable re-election.

    Interestingly, Walden’s service in the House spans two of the four presidential impeachment processes in American history. He ran his first congressional race in 1998 while the Starr Report was the talk of Washington, and took office after the House had voted to impeach and shortly before the Senate voted to acquit President Clinton. Walden’s announcement that he’ll not run for re-election in 2020 comes, of course, during the House’s current impeachment inquiry into President Trump. In spite of the impeachment bookends to his time in the House, Greg has largely eschewed focusing on presidential scandals du jour (of both parties) and instead focused on the areas of federal policy that impact his district as well as national issues related to telecommunications and health care.

    In his kind and fair demeanor and in his focus on legislation rather than bombast, Greg is unusual and increasingly so in Congress today. We owe him a debt of gratitude for his work over the past 20-plus years.

    So what happens now?  I wager more than 100 elected officials and others from Medford to Joseph to Burns to Bend to Hood River – throughout the almost impossibly enormous and diverse Second Congressional District – looked at themselves in the mirror Monday, on hearing the news that Walden wouldn’t run for re-election, and saw a soon-to-be congressperson. In a district that’s been represented without serious electoral challenge for two decades,and that is so geographically large it has numerous local political power centers, there will be no shortage of candidates on either side, but I think especially on the Republican side.

    So what should we in OR02 look for in the upcoming campaign? Or, more specifically, what should we hope for? The defining fact of the district’s relationship with the federal government is that the feds own about 55% of the land here. Our federal neighbor creates some really good things – like preserved natural areas for recreation that has fueled economic growth in places like Bend and Hood River – but also some bad things – like forest fires and the attendant smoke and also taking a giant swath of land off the table for non-recreational economic use. Go to places like John Day or Burns and ask if the federal government has been a good neighbor and the few people left in town who don’t work for the federal government would probably say not really. It’s an odd thing being neighbors with someone who makes the laws that govern his own land but also yours.

    The fact that we are in close proximity to so much federal land also makes it more important to us than perhaps to others that the federal government be at least reasonably solvent. Living next door to someone who makes the rules for himself and for you and is also undergoing foreclosure is bad news. The property goes untended, and impacts your property too. So, folks in the Second District have a very strong interest – even stronger than many other Americans – in seeing the federal government stop spending a lot more than it takes in.

    One of our themes here at BBR is that the federal government can’t often improve our lives by doing more. It’s too distant and big to be effective, even if it wanted to help. The good news is that the federal government is doing so many things poorly that it can make things better by just stopping a lot of those things, and it’s imperative that we do. Our pursuit of happiness-delivered-by-the-feds without paying for it has led to massive budget deficits even when the economy is doing relatively well. At some point, we must realize that our pursuit is insane in that (1) it’s not making us happier, and (2) it’s significantly eroding our children’s and grandchildren’s ability to pursue happiness for themselves by saddling them with the burden of paying for our own fruitless pursuit. In the Second District, this is doubly true because a functionally insolvent federal government will be a very bad neighbor indeed.

    While I wouldn’t wager in this environment on the likelihood that we will see a campaign that focuses on difficult federal issues – both short- and long-term – affecting people who live here, we at least have the recent and effective example of a Congressman who has done that for two decades. What do we have if not hope?

    Your friends can sign up to receive the Bend Business Roundup here. No sales, no spam. Just the weekly email you’ve come to know and love.

    Have a great weekend!

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  • Bend Business Roundup 10-25-19

    By on October 25, 2019

    Happy Friday,

    Here’s some stuff you might like.

    Business: Imagine your business is not located in a particular city, and has never operated or advertised there. Despite that, your business is so well-known and beloved in the city that someone takes it upon him or herself to put a “Your Business Coming Here Soon” sign up. People in the city get so excited about your business coming to town they call the local media, which finds out that, no, your business is not actually coming to the city. The local population is despondent. The whole story becomes not just local but national news. What would you do? You’d swim around in your Olympic-sized pool filled with hundred dollar bills, that’s what you’d do.

    Law: During the Great Depression, some private timberland owners couldn’t afford to pay their county property taxes, so they forfeited the land to the counties. The counties, in turn, couldn’t afford to manage and replant the frequently denuded parcels, so they entered into an agreement under which they transferred the property to the state, in exchange for a promise that the state would manage the property in a manner that generated the “greatest permanent value” of the land. For a long time, that meant harvesting trees and returning some of the revenue to the counties. In 2001, Oregon adopted a new management plan for the land that added recreation and environmental factors into the definition of “greatest permanent value.” A bunch of counties and taxing districts sued the state for breach of contract, seeking $1.5 billion in damages, arguing that one party to a contract cannot unilaterally change the meaning of that contract. If the plaintiffs win, forest management practices for large swaths of state-owned land would presumably change in favor of greater harvests in the future.

    Politics: The headline “Deschutes County has equal Republicans, Democrats” is a little premature (as of the most recent voter count, there were still 531 more Republicans than Democrats registered in the county). But that margin is shrinking – quickly – and Deschutes will soon be a plurality Democrat county, perhaps by the 2020 election. It was only 11 years ago, during the 2008 campaign, that Bend – the most liberal city in the county – became plurality Democrat.

    Et cetera:  When I started college, I thought I wanted to be an engineer like my grandpa. Then my freshman year I took calculus and, well, hahaha. A politics and history double major, law school and a career consisting of words instead of numbers would work just fine, thanks. Now it turns out my struggles with higher math weren’t really my fault. According to a Seattle school district proposal, math probably oppressed me. The plan invites teachers to explore with their students the malevolence of math:

    “identify the inherent inequities of the standardized testing system used to oppress and marginalize people and communities of color,” “explain how math has been used to exploit natural resources,” and, my favorite, “explain how math dictates economic oppression.”

    I guess math dictates economic oppression by adhering to the outdated, exploitative and hegemony-sustaining concept that 1 is more than 0? This is the revenge of the politics and history majors

    Your friends can sign up to receive the Bend Business Roundup here. No sales, no spam. Just the weekly email you’ve come to know and love.

    Have a great weekend!

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