Deschutes County backs broader uses for lodging tax, opposes bill to let striking public workers collect unemployment

Deschutes County commissioners on May 9, 2025, agreed to support House Bill 3962 — a replacement for HB 3556 that county staff said would expand allowable uses of the transient lodging tax (TLT) — provided the county’s earlier request that any change apply only to future increments is preserved. The board also voted to oppose Senate Bill 916, which would allow striking public workers to tap the state Unemployment Insurance trust fund, and directed staff to draft an opposition letter for the county’s legislative delegation.

The move on HB 3962 follows a large public hearing in Salem and a dash-2 amendment that staff said expands the definition of eligible tourism-related spending to include public safety and community infrastructure. "It gives flexibility so you wouldn't have to increase the rate as much but still be able to pay for those public safety costs," said Doug Riggs, the county's legislative consultant. County staff and several cities testified in favor of the bill, while some visitor-industry groups testified in opposition, meeting participants said.

Why it matters: Local governments said the bill would let them use portions of TLT revenue for policing, facilities and other infrastructure linked to tourism demand instead of increasing the tax rate solely to fund non-marketing costs. County staff noted the statutory allocation structure in many jurisdictions still follows a 70/30 split that directs a majority to tourism marketing, leaving 30% for other local priorities. Commissioners said the county wants to preserve prior guidance that any change apply to new increments of the tax rather than redirect funds already distributed.

On SB 916, county leaders emphasized the potential budgetary impact. County staff pointed to a local analysis estimating a possible cost to Deschutes County of about $458,000 per week under some scenarios; the Association of Oregon Counties' testimony cited broader ranges for counties by size. "While I believe public employees have the right to strike, I don't think that we should have to pay them while they're striking," Doug Riggs said in the discussion about the county's position. Commissioners directed staff to prepare an opposition letter that would include county-specific fiscal estimates.

Other items discussed included the upcoming statewide revenue forecast, which county lobbyists said will shape subcommittee budgets; a capital construction subcommittee hearing on lottery bonding and local projects that day; and several other bills the county is tracking, including HB 3069 (behavioral health-related items), HB 2954 (substance and addiction prevention funding) and SB 277 (extradition for foreign nationals). Commissioners and staff also discussed ongoing uncertainty around a transportation package and a Republican alternative framework that would cut state support for public transit and other programs, which local officials said could threaten payroll-tax-funded support for systems such as Cascades East Transit.

Meeting direction and next steps: Staff will draft and circulate two letters (one supporting HB 3962 with the county’s previously stated amendment to limit flexibility to future increments; one opposing SB 916) for commissioners' review and signature. Staff identified Cam Sparks in the county budget office as a source of county-specific financial estimates for the SB 916 opposition letter. County lobbyist Doug Riggs and county legislative staff will continue to follow the revenue forecast due May 14 and the Ways and Means schedule for bonding and staffing hearings.

The commissioners’ positions are advisory to the county’s legislative team; any formal testimony will be filed consistent with state deadlines and committee procedures, and the county noted that remote testimony availability may be limited when rooms are full.

Deschutes County staff said they will provide the draft letters to commissioners by close of business the same day for review and send them to the county delegation and the relevant committee staff as the work sessions are posted.