What’s Legal When It Comes to CBD in Edibles and Alcohol
As new trends and topics in the alcohol industry emerge, the OLCC strives to keep current on these issues. Recently, there has been significant interest throughout the industry in the use and sale of cannabidiol (CBD) items on liquor-licensed premises. The Agriculture Improvement Act of 2018 (also referred to as the 2018 Farm Bill) was partially responsible for generating this interest because a part of the bill removed “hemp” and its derivatives from the definition of “marihuana” in the Controlled Substances Act. Although the 2018 Farm Bill established some regulatory authority for hemp under the U.S. Department of Agriculture (USDA) and the Federal Food and Drug Administration (FDA), this piece of legislation did little to explain or clarify the legal status of CBD and CBD products. Due to this uncertainty, the next few paragraphs will attempt to explain the complexities of this issue and help to answer a few questions about CBD products and OLCC liquor licensees.
What is CBD?
First, it is important to understand what CBD is and where it comes from. CBD is a non-intoxicating chemical compound (called a cannabinoid) that can be derived from cannabis plants. Because both hemp and marijuana come from the same plant (cannabis) they are both interchangeably referred to as cannabis, but there is an important legal distinction. Whether a cannabis plant is considered hemp or marijuana depends upon the amount of tetrahydrocannabinol (THC) the plant contains. THC is, of course, the cannabinoid responsible for the psychological effects associated with marijuana consumption. For a cannabis plant to be considered hemp, it must contain less than 0.3 percent THC, otherwise the plant is considered marijuana. Because marijuana is still considered to be a Schedule I controlled substance by the federal government, the source of the CBD is important. Even if a finished CBD product contains 0 percent THC, if the CBD was derived from a plant that contained more than 0.3 percent THC and is therefore marijuana, the CBD is considered a marijuana derivative. In Oregon, marijuana and all marijuana derivatives may only be sold by a licensed recreational marijuana retail store or medical marijuana registrant. For OLCC liquor licensees, the source of the CBD is also important because permitting the use or sale of a marijuana item on a liquor-licensed premises is a violation that could result in a license suspension or civil penalty.
Although the CBD must be derived from hemp, not all hemp products contain CBD. Hemp stalks and seeds contain only trace amounts of CBD and have been legally used in food and beverages prior to the passage of the 2018 Farm Bill. The CBD used in many popular products is commonly extracted from the flowers and leaves of the hemp plant. The remainder of this article refers to CBD derived from hemp.
What Conduct is Prohibited?
Despite the current lack of legal clarity, federal agencies have provided guidance on two types of conduct that are prohibited. First, the FDA, which regulates food products and food safety, has determined that selling or offering to sell a food or beverage item containing CBD in interstate commerce is illegal. For OLCC liquor licensees to comply with federal law, they should not purchase CBD products that were produced in another state.
Second, the Alcohol and Tobacco Tax and Trade Bureau (TTB), which regulates the manufacture and sale of alcoholic beverages, has determined it will not approve any alcoholic beverage formulas that contain CBD. Because obtaining formula approval is required to produce an alcoholic beverage with a non-traditional ingredient (such as hemp), all alcoholic beverages manufactured with CBD are prohibited. This means that all OLCC licensees that manufacture alcoholic beverages are prohibited from adding CBD during the production of the beverage or prior to bottling. To help clarify the agency’s position, the OLCC has proposed a rule change that would make it a violation for any OLCC liquor licensee to manufacture, store, or sell any alcoholic beverage that contains cannabinoids or any substance derived from cannabis, including cannabis terpenes. If adopted at the December Commission Meeting, the rule would apply to all license types and be effective January 1, 2020.
What about Non-Alcoholic CBD Products?
The two other common questions received by the OLCC on this issue involve non-alcoholic CBD products. Licensees are particularly interested in mixing non-alcoholic CBD beverages with alcohol in a mixed drink for on-premises consumption and are also interested in selling non-alcoholic CBD products on liquor-licensed premises.
In Oregon, hemp production is regulated by the Oregon Department of Agriculture (ODA). The ODA has adopted rules that govern products made with hemp, including items intended for human consumption. Under ODA rules, those food and beverage items made with hemp are required to be tested in the same manner that marijuana food items are tested in Oregon. This means that an OLCC licensed laboratory or equivalent lab must receive samples from each process lot of the hemp items and the lab must test those products to ensure they meet certain standards regarding pesticides, solvents, and potency. Because people are going to be consuming these products, it is extremely important to make sure that these items have been tested.
Because the effect of mixing CBD and alcohol is currently unknown, the OLCC recommends that licensees do not mix CBD and alcohol together into mixed drinks for on-premises consumption. If a licensee chooses to do so, it is done at the licensee’s own risk. If a licensee would like to sell a non-alcoholic CBD item on a liquor-licensed premises, the licensee must obtain a copy of the lab report showing that the product was properly tested according to the ODA’s rules. If any licensee is currently selling any CBD products that have not been properly tested, the licensee should have removed all non-compliant products from their inventory by December 31, 2019.
The OLCC is publishing guidance documents on the OLCC website to help explain what types of activities may occur on a liquor-licensed premises. The guidance is split into five categories: alcohol manufacturing, wholesale and distribution, liquor store sales, sale of alcohol at retail, and testing requirements. The guidance is meant to help provide clarity for a very complex issue. These documents are scheduled to be available by the end of December and will be updated if rules or policies change. If you have questions, please visit the OLCC website at Oregon.gov/OLCC or contact the OLCC. | Jamie Dickinson, Oregon Liquor Control Commission
This article originally published in the Oregon Restaurant & Lodging Association Magazine - Winter 2020
Oregon Restaurant & Lodging Association to Honor Six Restaurant Industry Members
[Wilsonville, OR] – Oregon Restaurant & Lodging Association (ORLA) is proud to announce the 2020 state winners of the National Restaurant Association Educational Foundation’s (NRAEF) Restaurant Industry Awards. Two restaurants, Elephants Delicatessen (Portland) and Sybaris Bistro (Albany) were named state winners for the Restaurant Neighbor Award. Loretta Guzman (Bison Coffee House, Portland), Jason Devrouax (First Burger, Albany), and Lauro Romero (Kimpton Hotel & Restaurant Group, Portland) were named state winners for the Faces of Diversity Award. Paul Paz (WaitersWorld, Portland) was named state winner for the Ambassador of Hospitality Award.
“The involvement and dedication these restaurants have shown in support of local philanthropy is commendable and exemplifies the spirit of our industry and our state,” said Jason Brandt, ORLA President & CEO. “It’s an honor to recognize these restaurants as well as four individuals who have achieved success through perseverance and passion.”
Nine out of 10 restaurants give back to their communities through charitable activities. Restaurants also play an important role in providing a ladder of opportunity for millions of Americans to achieve the American Dream.
Each year, the NRAEF recognizes restaurants around the country for outstanding community service, diversity and leadership. These prestigious national awards honor restaurants that go above and beyond in supporting their community and inspiring others with their stories of success.
All state winners were forwarded to NRAEF in consideration for national awards to be announced early March. Three national Restaurant Neighbor Award winners will receive a $10,000 award to help support their favorite charity or community project. Three national winners of the Faces of Diversity Award will have a $2,500 scholarship awarded in their name to an aspiring student from their state. In addition, all national winners will be flown to Washington, DC to receive the award at a special banquet on March 4, 2020.
Oregon’s award recipients will be formally recognized among their peers during the ORLA Hospitality Conference, this year in Ashland, September 28-29, 2020.
For more information on Oregon's restaurant awards, visit OregonRLA.org/restaurant-awards.
ProStart Teacher's Education Session Fall 2019 Resources
In November 2019, Metro's Sustainability and Food Waste team gave a presentation to ProStart teachers on food systems, food waste and climate change. The following resources are made available to teachers for use in their culinary classrooms.
Plan, Shop, Chop (PSC)
In this interactive simulation, students plan and shop for a meal of their choosing and then calculate and discuss the impact when an average of 40% of food is wasted in the United States. Topics include greenhouse gas emissions, use of landfill space, and loss of natural resources, human labor, and money, as well as generating solutions to prevent food waste at home. The lesson includes optional extensions to investigate the food waste hierarchy and examine the supply chain of a common food item, the banana.
Plan, Shop, Chop Lesson:
Banana Supply Chain:
Living with Food in the 21st Century
This two-part lesson guides participants through a new story of climate change using a lens of hope, equity, community resilience, and increased quality of life. After discussing the basics of climate science with graphs and personal stories, participants will use an interactive concept map and short video series to understand the link between consumer culture and climate disruption. They will then investigate a range of individual and collective actions to combat climate change through a ranking activity with drawdown solutions and a climate justice mixer.
Additional Resources from the Oregon Department of Education (ODE)
At their most recent meeting, the Oregon Restaurant & Lodging Association (ORLA) Board of Directors voted unanimously (with 1 abstention) to support a legislative bill which will originate from Governor Brown’s office in support of a permanent 1.8% statewide lodging tax rate during the 2020 Oregon Legislative Session. Revenue raised by the statewide lodging tax is invested in Travel Oregon’s efforts to strengthen the economic impact of our state’s tourism industry. Oregon’s statewide lodging tax is currently collected at a rate of 1.8% with a reduction in the rate scheduled to take effect as of July 1, 2020 to a permanent rate of 1.5%.
“We appreciate Governor Brown’s proactive outreach to meet with ORLA and some of our key lodging stakeholders in person to discuss the merits of keeping the statewide lodging tax rate at 1.8% permanently,” said Jason Brandt, President & CEO of ORLA. “Our goals for lodging tax rate structures in Oregon are two-fold – protecting all statewide lodging tax resources to create return on investment for the industry through the efforts of Travel Oregon and protecting local lodging tax reforms passed in the 2003 Legislative Session.”
Oregon continues to experience healthy growth in tourism spending logging our ninth consecutive year of industry growth in 2018. Compared to 2017, visitor spending was up 4.2% reaching a record $12.3 billion. Industry employment was also up year over year by 2.9% to approximately 115,400. Year over year, hotel room revenue increased by 4.4% as well.
“We have seen firsthand what strategic investments in tourism promotion can do when industry tax dollars are put to their most effective use,” said Brandt. “With many other competing priorities in the Capitol, it is essential the association protects the appropriate use of these dollars at both the local and state levels. The economic impacts we are seeing are significant not just for our industry but for our public sector partners as well.”
The U.S. Travel Association tracks statewide economic impact throughout the country and assists states in quantifying the value of year over year tourism growth. The most recently available data notates Oregon’s tourism growth at 5.3% when comparing 2016 to 2017, further substantiating the value of healthy tourism growth for Oregon’s public sector. From 2016 to 2017, Oregon experienced visitor spending growth of $652 million. That increase in spending and associated payroll income tax increases equates to as many as 410 firefighter positions, 380 police officer positions, or 380 teacher positions.
ORLA continues to focus on the protection of local lodging tax dollars for tourism promotion and tourism related facilities in addition to support given to Governor Brown’s upcoming legislative bill for the statewide resource. Oregon’s local lodging tax structure can be complicated with over 110 different city and county jurisdictions collecting a transient lodging tax outside of the 1.8% statewide tax. Important guidelines have been in place for the past 16 years for how local lodging tax dollars can be spent. To clarify those parameters, ORLA recently produced a new instructional video to assist all stakeholders and the general public in better understanding the rules which govern local lodging tax resources.
The new video specific to local lodging taxes (not to be confused with Oregon’s 1.8% statewide lodging tax) can be viewed here:
For more information about the Oregon Restaurant & Lodging Association’s policies on transient lodging taxes, please reach out to Greg Astley, ORLA’s Director of Government Affairs, at firstname.lastname@example.org via email.
Commercial Activity Tax (CAT)
The new Commercial Activity Tax is imposed only after a taxpayer exceeds $1 million of taxable commercial activity. Once they pass that threshold, the tax is $250 plus 0.57% on gross receipts greater than $1 million after subtractions. Proceeds of the tax are directed by statute to boost funding for public schools. The Department of Revenue's website includes a list of frequently asked questions (FAQs) for tax payers to better understand what the tax is and who is subject to the tax.
Announcements from ORLA:
Apr. 22, 2020 - In a brief statement yesterday, the Governor announced she does not support delaying the CAT, despite having heard from several small- and medium-sized businesses that they face severe cash-flow and liquidity issues. However, she said the state will waive all penalties related to first quarter CAT payments.
Mar. 26, 2020 - Oregon Restaurant & Lodging Association joined 48 other Oregon businesses and organizations in signing a letter to legislators urging temporary relief from the Commercial (Corporate) Activity Tax. Oregon’s hospitality businesses are critically challenged with this crisis and a new tax could hurt their ability to pay employees, potentially leading to more layoffs. Read the letter.
Latest Updates / Announcements from the Department of Revenue and ORLA:
June 30 - In its recent special session, the Oregon Legislature made a series of clarifications to the Student Success Act which governs the Corporate Activity Tax (CAT). Visit the DOR website for more information on technical and policy clarifications in House Bill 4202.
June 9 - DOR will hold a public hearing for the second set of permanent rules for the Corporate Activity Tax via conference call 9 to 11 a.m. Tuesday, June 23. The rules and additional information about the hearing can be found on the administrative rules page of the Revenue website.
May 6 - Oregon DOR has determined that certain federal assistance to businesses under the Coronavirus Aid, Relief, and Economic Security (CARES) Act is not commercial activity under Oregon statute and will not be subject to the Corporate Activity Tax. The exempt assistance includes forgiven Paycheck Protection Program (PPP) loans, Economic Injury Disaster Loan (EIDL) advances, and Small Business Administration (SBA) loan subsidies. More information can be found in the Beyond the FAQ section of the CAT page on the department’s website.
Apr. 29 - The Department of Revenue has revised OAR 150-317-1300 to reflect a change in the threshold for making estimated tax payments from $5,000 of annual tax liability to $10,000 of annual tax liability for the first year of the tax. This means businesses that will owe less than $10,000 are not required to make quarterly estimated tax payments during 2020. DOR also won’t assess penalties for underestimated quarterly payments or for not making a quarterly payment, if businesses don’t have the financial ability to make the estimated payment.
Apr. 17 - First Quarter Corporate Activity Tax payments due April 30; Good faith effort will prevent underpayment penalties. The department will not assess underpayment penalties to taxpayers making a good faith effort to estimate their first quarter payments for the CAT.
Apr. 10 - DOR has begun the process of converting 16 temporary administrative rules for the CAT into permanent rules. The process will include a public comment period and a hearing on the rules, giving business taxpayers and tax professionals additional opportunities to provide input into the rules before they become permanent. Click here to sign up to receive rulemaking notices from the department.
Mar. 20 - DOR posted a link to a video of the March 10 CAT update meeting in Ashland on the agency’s website. The department has also posted a copy of the presentation used in the update meetings. Business taxpayers can send questions to email@example.com.
Mar. 13 - DOR has suspended its series of Commercial Activity Tax (CAT) update meetings due to concerns about the spread of the novel coronavirus, or COVID-19. In the coming days, the department will announce alternatives to the in-person meetings for providing CAT update information to business taxpayers and tax professionals.
Mar. 6 - Two new administrative rules governing Oregon’s new Corporate Activity Tax (CAT) have been officially filed with the Secretary of State effective March 6. Twelve rules for the CAT became effective Jan. 1 with four others taking effect Feb. 1.
Feb. 6 - The Oregon Department of Revenue (DOR) will host a series of meetings across the state in March to provide information to business taxpayers about the administrative rules for the new Commercial Activity Tax. Complete schedule available online.
Jan. 27 - Three new draft rules have been posted on DOR's CAT page, allowing business taxpayers time to review the rules and use them as guidance on how to proceed and offers them an additional opportunity to have input into the rules.
Jan. 13 - A new draft administrative rule has been added to the CAT page on the DOR website and is the first of the second group of temporary rules which will be officially filed with the Oregon Secretary of State February 1.
Jan. 6 - General guidance on how to calculate a business’s CAT liability has been added to the FAQ page of DOR's website. The guidance includes information on how to use the labor or cost subtraction.
Jan. 2 - The first group of 12 temporary administrative rules governing the new CAT have been officially filed with the Secretary of State, found on the Secretary of State’s website under current rules for Chapter 150, Division 317. Permanent rulemaking begins April 1.
Resources & Webinars to Help You Understand the CAT
The Commercial Activity Tax is complicated and calculating your potential tax can be confusing. Therefore, ORLA has created a CAT calculator example to help our members understand how to calculate the tax. This exercise is only meant to help you project what your tax liability could be; as always, be sure to consult your tax advisors.
ORLA hosted two members-only informational webinars on Nov. 19 and Dec. 3 that explained the new tax, the Department’s implementation plans and what you can expect as a business owner. Tax experts with accounting firm Moss Adams LLP in Portland also provided some best tax practices for the hospitality industry. ORLA members can access the slide deck from the presentation by logging into the Member Portal on ORLA's website and clicking the Resource Library.
FAQ: Can we include the CAT tax on our customers’ bill?
A. The legislation that established the CAT (Oregon Laws 2019, Chapters 122 and 579) does not specifically prohibit a business from passing on additional cost of the tax. If you do choose to add a new line item to the receipt, the line item itself still counts as “commercial activity” when determining your tax liability. Consult with an attorney or financial advisor before making any final decisions.
How the Commercial Activities Tax Came About
This was one of the 2019 Legislative Session bills having the biggest impact on businesses. ORLA was opposed to this bill as it raised taxes on commercial activity for businesses with gross revenues of over one million dollars. ORLA, along with others in the business community, was able to amend the original bill to include a deduction for labor or cost of goods sold. The association will work during the rule making session to ensure hospitality businesses will be able to include the tax increase on receipts so customers can see the impact of the tax.
Additional Information and Timeline for the CAT
DOR Sought Industry Input in CAT Rule Making
The Department of Revenue (DOR) held a series of town hall meetings across the state in September-October to seek input from business taxpayers about the administrative rules for Oregon’s new Commercial Activity Tax (CAT). Nearly 900 business taxpayers and tax professionals took part in these public forums or participated in video conferences and conference calls. More information is now available on the CAT page of DOR website.
If you have any questions, please email Greg Astley, Director of Government Affairs, at Astley@OregonRLA.org.
This is for general informational purposes only. The information is not, and should not be relied upon or regarded as, legal advice. Please consult with your legal advisors.
Inside Licensing: Create a Buzz With Music (Guest Column)
There’s only one thing better than a cold beer and spending a leisurely afternoon in a taproom with friends enjoying craft brews, and that’s having music in the background. Better yet, live musicians playing for the crowd.
Music is used by businesses everywhere because it creates an atmosphere that encourages customers to relax and enjoy themselves. Isn’t that exactly how you want your customers to feel at your establishment? They’ll stay longer, spend more, and tell friends about the great time they had.
But playing music publicly in any business involves more than just turning it on, streaming it, or hiring live musicians. Music, like all intellectual property, belongs to the songwriters and composers who create it, and that ownership is protected under U.S. and global copyright laws. These laws were written with one purpose in mind: to encourage music creators to continue their craft and reward them for their unique contributions to our culture.
How does a business go about getting the permission it needs to play a songwriter’s music? By working with a performing rights organization such as BMI, ASCAP, SESAC, or GMR. PROs (performing rights organizations) try to make the licensing process as simple as possible by granting permission to play millions of songs with one license and one annual fee. This saves business owners the immense time and expense of tracking down and negotiating fees with all the songwriters and composers of the music they play.
Some business owners believe that, since they only play live original music, they don’t need a license. That’s not true. The term “original music” generally means music written by the performing musicians. Those musicians, however, may also be songwriters who are affiliated with BMI (most professional musicians are members of a performing rights organization). Writers join such licensing organizations because they’re the vehicles through which songwriters and composers are compensated for the public performances of their music. BMI operates on a not-for-profit basis and distributes 90 cents of every dollar in licensing fees back to its affiliates. That means even if musicians play their own music, they can register their sets and be paid through the BMI Live program.
Another common misconception is that, if musicians are playing live music, they’re responsible for paying their own public performance fees. This is also not true. Just as a bar or restaurant owner wouldn’t ask their bartender to secure the liquor license, it’s not up to the musicians to secure the music license. It’s like any other license a business owner must have, and even if the musicians are hired as independent contractors, the responsibility for licensing can’t be passed on to the performers.
Licensing the music you use will not only protect your business, it will also help ensure the continued creation of great music for you—and all of us—to play and enjoy.
[Article originally published in Spirited Magazine, November 2019]
Celebrating over 79 years of service to songwriters, composers, music publishers and businesses, Broadcast Music, Inc.® (BMI®) is a global leader in music rights management, serving as an advocate for the value of music. BMI represents the public performance rights in over 15 million musical works created and owned by more than one million songwriters, composers, and music publishers. BMI is an Endorsed Service Provider of the Oregon Restaurant & Lodging Association.
Oregon Restaurant & Lodging Association members who meet the group eligibility requirements can receive an additional 14% discount with SAIF in the ORLA Group plan
[Wilsonville, OR] – SAIF announced today final approval of a 14% discount on workers’ comp premiums for Oregon Restaurant & Lodging Association (ORLA) members who meet the group eligibility requirements. This represents the largest discount available for Oregon’s hotels and restaurants in the program.
"With the cost of doing business continuing to rise, this program provides needed coverage along with significant cost savings for hospitality members,” said Jason Brandt, president and CEO of ORLA. "We are excited about the new group discount and the continued opportunities we have to jointly promote safer workplaces with our partners at SAIF.”
ORLA’s endorsed service partnership with SAIF gives eligible ORLA members a workers’ compensation group discount that is validated by NCCI and approved by DCBS. As the restaurant and lodging industries face some of the most difficult workplace safety challenges, this partnership aims to reduce worker injuries and improve member’s safety programs.
SAIF also declared two dividends earlier this year, one based on premium and one tied to safety performance. SAIF determines whether a policyholder dividend is appropriate based on capital levels, claim trends, and the overall economic environment. This year SAIF has seen strong investment returns and favorable trends in injury prevention and claim cost containment.
“As a not-for-profit with a public mission to make workers' comp available and affordable, paying dividends is an important part of the value we offer Oregon employers,” said Kerry Barnett, president and CEO of SAIF. “In addition to dividends, we are proud to offer our customers some of the lowest rates, best-in-class service, and the largest network of workplace safety professionals of any insurance carrier in Oregon,” said Barnett.
Ask your agent for an ORLA Group quote or contact SAIF directly at 888.598.5880.
SAIF is Oregon's not-for-profit workers' compensation insurance company. Since 1914, we've been taking care of injured workers, helping people get back to work, and striving to make Oregon the safest and healthiest place to work. For more information, visit the About SAIF page on saif.com.
Thank you for your interest in becoming a judge for the ORLAEF ProStart Invitational, sponsored by Sysco, on Monday, March 2, 2020, at the Salem Convention Center. We appreciate your support.
The event work is demanding but inspiring. Many judges and volunteers return every year because it is so exciting to be part of the day’s energy, and to witness the results of our students four months of hard work.
Please complete the form below and type in N/A where answers do not apply. Thank you, we appreciate your support!
Wendy Popkin, Executive Director, ORLA Education Foundation | WPopkin@OregonRLA.org | 971-224-1505
Editorial from ORLA's President & CEO Jason Brandt
[as published in the Portland Business Journal, Oct. 4, 2019]
According to a new Gallup poll, Americans say the restaurant industry is the most respected in America. And those of us working for both restaurants and lodging establishments at Oregon’s statewide association are taking a moment to celebrate this milestone.
We hope you join us in celebrating all the reasons why restaurants are vital to the infrastructure of our local economies in Oregon while also learning more about the industry’s expansive business models. For our counterparts operating full-service models with waiters and waitresses in Oregon, the path to sustainability is proving harder to figure out. Nationally, an average of 95 cents of every dollar customers spend goes back into the food, the people, and the place. Operators across our state are working hard to figure out how to maintain that level of reinvestment into the future as the realities of increased regulation take their toll.
As the leader of the Oregon Restaurant & Lodging Association (ORLA), you won’t hear me crying wolf. Will there be massive closures of restaurants? No, but will there be an increase in ownership transitions and restaurants on the market for purchase? Yes. Will there be a hoard of server job losses as restaurants look at different business models? Probably not but we are seeing more counter service restaurants that do eliminate the existence of server positions and we expect those trends to continue. Are we seeing growing anxiety amongst our mom and pop restaurant establishments across this state as they attempt to absorb labor increases, additional human resource requirements for mandatory savings accounts for employees, paid sick leave, paid family leave, and the new corporate activity tax? Without question.
If we all take a step back collectively there is so much to celebrate relating to the role of restaurants in our society. Where else can an employee start as a dishwasher and rise to an executive position within a company? We have those stories. Where else can those working hard to get their lives back on track after serving time find jobs that pay a living wage? What industry employs more minorities and women managers than any other industry? You guessed it – that would be restaurants.
As we celebrate the findings of Gallup’s recent poll we also see it as an opportunity to make sure Oregonians better understand the pressures and anxieties facing restaurant operators in Oregon today. And if we love restaurants and their roles as cornerstones of our communities we hope you will join us in protecting their viability across the rural and urban landscapes of our great state.
Too often, our industry deals with headlines focusing on starting wage positions within restaurants and misperceptions about compensation opportunities in the industry. The world of restaurants is a land of opportunity for advancement and industry certifications for restaurant front line staff, supervisors, and managers are available to assist entry level employees with opportunities to advance.
One in three Americans had their first job in a restaurant and in today’s digital age what better way for our youth to develop crucial interpersonal skills than by getting their start professionally in a restaurant setting. Those of us at ORLA would argue there has never been a more important time for the role of restaurants in the lives of our young people.
As our industry continues the process of adjusting to new requirements for operating a business in Oregon we ask you to join us in celebrating the good that comes from embracing restaurant businesses across our state and we thank you for taking some time to better understand their triumphs and challenges. Remember, on average, 95 cents of every dollar spent goes back into the restaurant experience. We look forward to seeing you again soon for your next celebration. | Jason Brandt, President & CEO, Oregon Restaurant & Lodging Association
Top Restaurant and Hotel Industry Members Recognized by Oregon Restaurant & Lodging Association
Four members of Oregon’s food and lodging industry were recognized as 2019 Oregon Hospitality Industry Award recipients by the Oregon Restaurant & Lodging Association (ORLA) during the annual Conference in September. Chuck Hinman, Best Western Plus Hood River Inn was named Lodging Operator of the Year; Kurt Huffman, ChefStable (Portland) was named Restaurateur of the Year; Dorothy Petersen, Papa Murphy’s (Junction City) was named Employee of the Year; and Togather Restaurant Consulting was named Allied Partner of the Year.
The recipients of these awards were recognized among their peers and over 330 delegates of ORLA’s Hospitality Conference on September 17, 2019, at the Seaside Convention Center in Seaside, Oregon.
“Oregon’s hospitality industry is teeming with individuals who contribute significantly to the health of the trade,” says Jason Brandt, president and CEO of the Oregon Restaurant & Lodging Association. “These winners represent not only some of our industry’s most dedicated leaders and advocates, but also the exemplary service that sets the high standard for the entire industry to achieve.”
Lodging Operator of the Year: Chuck Hinman, general manager of the Best Western Plus Hood River Inn, has worked in the hospitality industry his entire career, primarily in hotel management in the Seattle, Portland and Hood River markets. He’s managed the Hood River Inn since early 1990, shortly after it was acquired by owner group D.M. Stevenson Ranch. Chuck has been a tireless advocate of the hospitality industry, engaging on issues impacting businesses and his local community. He served several years on ORLA’s Board of Directors and was Chair of the lodging association during the merger with the restaurant association in 2010.
Restaurateur of the Year: Kurt Huffman, owner of ChefStable, is well-known in the Portland restaurant scene as a passionate advocate for the industry. Under his vision and leadership, ChefStable, a hospitality management group and consultancy, has opened over forty restaurants in Portland, San Francisco, Las Vegas and beyond over the last ten years. ChefStable partners with talented and passionate chefs to design, build and operate restaurants, bars, catering and more–taking care of all of the operational details so its partners can focus on food and service. Kurt also provides leadership for the Portland Kitchen Cabinet, an ORLA-sponsored civic engagement program committed to growing and preserving opportunity in the restaurant industry.
Employee of the Year: Dorothy Petersen has been with Papa Murphy’s for close to 20 years and has become a fixture in the Junction City community. Dorothy knows almost every customer and goes out of her way to make every guest welcome and appreciated. She even inspired a young frequent customer to write a school paper on how he wanted to “be like Dorothy.” As store manager, she supervises a team of mostly young people, and often sees her role as a “mom” to them. Dorothy teaches the young employees more than just how to make a pizza, but also some key interpersonal and life skills.
Allied Partner of the Year: Togather Restaurant Consulting helps business owners with start up, turn around, staff training, menu creation, branding and marketing, and analysis and evaluations. Seth Gruschow, founder and owner of Togather, leads a dynamic team of professionals in working with influencers and innovators to create a networking web of local and reliable businesses. Togather serves as a tremendous resource to the industry by sharing their expertise at events and sponsoring programs like the ORLAEF ProStart Invitational.
For more information on the Hospitality Industry Awards, visit OregonRLA.org/Awards.
ORLA’s Education Foundation Savors Progress at a Steady Pace
“The way of progress is neither swift, nor easy” - Marie Curie
The hospitality industry may be behind others, such as healthcare, in terms of anticipating workforce challenges and creating a plan to address them. However, with growing partner engagement, we are starting to see small but steady progress this year!
One notable achievement has been the ability of ORLAEF to hire a part-time ProStart and Foodservice Workforce Liaison. Irina Bakun’s focus is to assist culinary program teachers integrate foodservice/hospitality career awareness, experiences, and connections routinely into their teaching and activities. ORLAEF’s goal is to utilize Irina’s time and experience to work directly with districts, their teachers, and industry partners to help create clear pathways and opportunities for career exploration and employment. Funding came from a grant from the National Restaurant Association Educational Foundation.
Other encouraging progress includes;
ORLAEF’s partnership with Worksystems resulted in a pilot to use our industry’s guest service training curriculum with nine of its social service workforce training partners. The agency’s clients will learn valuable skills AND more about jobs in our industry.
Thanks to collaboration with the Oregon Coast Visitor’s Association, we have created a strong partnership with Northwest Oregon Works. The workforce development agency helped fund in-person training for prospective employees using AHLEI’s stackable credentials as well as current employees looking to upskill and advance their careers. Combined with a fall training effort, 74 industry certifications were earned.
ORLAEF is working in a pilot program with the area’s school districts, who support seven high school culinary training programs. Our joint goal is to build closer ties with local industry members and to create a model for productive and sustainable industry involvement with classes that focus on culinary and hospitality training.
We commissioned a best practices study with researchers from OSU’s Hospitality Management Program. Several Oregon businesses have implemented creative programs that have enhanced their employee retention. Watch the videos at Oregonrla.org/workforcepractices.
GUEST SERVICE GOLD ®
Since the training initiative’s launch, the course has been used by 1,833 individuals and resulted in 1,746 participants earning their Certified Guest Service Professional designation. To learn more about the course go to OregonGuestService.com.
The leadership input and support from key partners who have contributed significant in-kind and cash resources has helped extend our reach via the programs above and also includes new industry training with food waste reduction. We are grateful to sponsors Travel Oregon, Sysco Portland, Vesta Hospitality, The Salem Convention Center, Metro, Curtis Restaurant Equipment, The Old Spaghetti Factory , and The Nines for their in-kind and monetary support as well as individual donors who have generously contributed monies.
Please consider helping us continue our work by becoming a sponsor, donating, and/or becoming involved with our school programs. | Wendy Popkin, ORLEF
“Progress means getting nearer to the place you want to be.” ― C.S. Lewis
Wendy Popkin is the Executive Director for ORLA’s Education Foundation (ORLAEF), a nonprofit foundation dedicated to supporting the educational and training needs of the hospitality industry. Wendy is a 30+-year career veteran who describes herself as “fanatically enthusiastic about helping others enjoy the same type of fabulous career opportunities I have enjoyed in the hospitality industry.” Oregonrla.org/EdFoundation
THE CUSTOMER ISN’T ALWAYS RIGHT, BUT THE CUSTOMER IS ALWAYS THE CUSTOMER
Make sure you understand the value of responding to your reviews!
Let’s discuss something a little controversial: online reviews and how to respond to them. TripAdvisor reviews. Facebook reviews. Google My Business reviews.
How about Yelp reviews? There, I said it. Is your heart racing all of a sudden? Blood pressure up? Face red? Good. Now settle down and take a breath. We’re going to get through this together. We’ll focus on Yelp, but what I’m going to say translates to all review sites.
Between 65 and 90 percent of consumers, depending on which study you read, are influenced by online reviews. For Yelp alone, as of March 2016, there are an average of 164 million unique visitors per month (62 million desktop computer visitors, 69 million mobile web users, and 33 million app users.) 72 percent of consumers say positive reviews make them trust a business more, and 90 percent say positive reviews directly influence their buying decisions. And guess what – people are more likely to share a negative experience than a positive one. Common sense? Of course. Okay, enough statistics. So, what does all that tell us?
It tells us that the opposite is also true. Negative reviews influence people. It also tells us that your customers probably use Yelp. You probably even use Yelp yourself to find a restaurant, or a new barber, or any number of businesses you need to look up. I’m sure you take a peek at your own reviews once in a while, and hopefully respond to them.
Can you afford to risk 65 to 90 percent of your potential customers reading your negative reviews and you pretending they don’t exist?
Restaurants and hotels
Sometimes your food can fall short of expectations, or maybe the server or kitchen got it wrong. Maybe your front desk wasn’t as helpful as it could have been. Sometimes an employee can be perceived as rude or dismissive.
I know, your employees would never be rude or dismissive. But two things:
Like the title says, the customer isn’t always right. Perception is reality. And they are always the customer. You want to keep their business, right? Get referrals? Sell more rooms or get more butts in your seats? You need to fix your negative reviews. Here is our “best practice” strategy:
How to handle negative reviews (the “recovery”)
We’ve seen two important outcomes from our partners who follow the above. First, often the customer will update their review and add additional stars. Awesome! Second, customers who have been recovered using these techniques often become extremely loyal fans of the business, sometimes even more so than if they had a good experience to start with. Super awesome! Going the extra mile and showing the attention makes a big difference.
A recent study showed that a one-star increase in a business’ Yelp score translates into substantial revenue increases. You may not like Yelp, but you can’t afford to ignore it. So, go win back a customer! | Jay Skowron, Hospitality Defender
Jay Skowron is the Founder and Principal of Hospitality Defender, specializing in social media marketing, online review management, websites, and process consulting. He can be reached at firstname.lastname@example.org.
Any views or opinions presented in this blog post are solely those of the author and do not necessarily represent those of the Oregon Restaurant & Lodging Association.
ORLA proudly announces the launch of the Oregon Tourism Leadership Academy (OTLA), developed in partnership with the Oregon Destination Association and Travel Oregon, and led by the industry’s top experts. The new annual experiential learning program is targeted to public and private sector tourism professionals who are seeking to polish their leadership and professional skills, continue to grow their career accomplishments, and make positive and lasting contributions to the state’s tourism economy and its success.
“We believe we are embarking on a leadership experience which will prove to be transformative for program participants,” said Jason Brandt, President & CEO for the Oregon Restaurant & Lodging Association. “The academy will bring lasting personal and professional benefits to those who participate.”
Curriculum, field visits, and hands-on experiences are strategically designed to support and align with the state’s tourism goals and objectives which include four Strategic Imperatives:
The OTLA experience is designed for professionals currently serving Oregon’s tourism and hospitality industries. Interested program participants should have supervisory, managerial, or executive responsibilities in either the private or public sector. Applications from industry professionals who will soon be responsible for similar levels of responsibility are also encouraged to apply for the academy program. The strategic imperatives outlined above will serve as the program’s core themes each year. Each theme will receive focus as a part of four multi-day experiential learning programs designed to provide academy participants with comprehensive educational experiences. Each year, 20 academy participants will immerse themselves in the academy’s professional development curriculum alongside industry experts and facilitators.
For more information on the Oregon Tourism Leadership Academy, visit www.Oregonrla.org/OTLA.
If you’re a cancer patient and your doctor says, “Your best hope for a cure is in another city,” your first thought may be, “Where am I going to stay and how am I going to pay for it?”
The American Cancer Society can help. The Society works together with hotels through its Hotel Partners Program to provide complimentary rooms to cancer patients who need to travel out of town to receive treatment. In 2018, more than 211 patients were served through the Hotel Partners Program with nearly 921 nights through participating hotels in Oregon. Though we have great support from numerous partners, last year approximately 247 requests went unmet in the Oregon area - which is why the Society is seeking hotel partners throughout Oregon to help fill the need for free lodging for cancer patients.
The American Cancer Society is proud to partner with and recognize the following Oregon Restaurant and Lodging Association Members:
Hotels that partner with the American Cancer Society show a commitment to their communities and to patients struggling with cancer. They can be proud that their hotels are taking an active role in the fight against cancer. “I learned firsthand how difficult it can be on cancer patients that need to travel for treatments when my best friend in Bend, Oregon was diagnosed with cancer several years ago. Being in the hotel business I was able to offer complimentary accommodations when he visited OHSU. My thoughts quickly went to those that do not have a connection or friend in the hotel business, what do they do? When I learned that the American Cancer Society offered a program to assist those patients, the Duniway was eager to partner.” - Ryan Kunzer (GM, The Duniway)
“Defeating Cancer is a global challenge, fought locally. Along with many hotel partners here in Portland, we are honored to support the families of patients as they go through what must be one of the most stressful times of their lives.” - Alex Dawes (GM, Embassy Suites Downtown Portland). Dawes, Embassy Suites in Downtown Portland, General Manager, is also demonstrating his commitment to the fight against cancer by participating in the 2019 Real Men Wear Pink campaign. “Making Strides Against Breast Cancer and the Real Men Wear Pink campaigns are all about ensuring ongoing awareness and having some fun at the same time.”
The American Cancer Society is seeking additional hotel partners for the program. If you are interested in partnering to provide complimentary rooms for cancer patients or have an executive interested in participating in the Real Men Wear Pink campaign, please contact Courtney Clark at email@example.com or 503.795.3971.
For information about American Cancer Society programs and services, including lodging, please visit Cancer.org or call 1-800-227-2345.
[updated December 2019]
A federal spending bill passed in 2018 abolished a 2011 regulation prohibiting tip pooling; managers can now require that servers share tips with kitchen staff in states where employers do not take a tip credit. This change allows tip sharing among both customarily and non-customarily tipped employees in Oregon, including dishwashers and cooks. Managers, supervisors, and owners cannot participate in the tip sharing. A proposed rule to implement the change has been released as of October 7, 2019; comments were due by December 9, 2019.
One thing this proposed rule seeks to address is that the words “supervisor” and “manager” were not defined in the 2018 spending bill. This is especially important to our industry since many have hybrid approaches to their service positions. Supervisors and managers in some of Oregon’s smallest restaurant operations commonly serve guests and have participated in front-of-the-house tip pools as a part of a team approach to foodservice.
Employers are to use the “duties test” to determine who qualifies as a supervisor or manager, and establish tip pool eligibility. Essentially, if an employee’s primary or regular duty is not management or supervising, they are still allowed to participate in a tip pool. For details on the standard of the “duties test,” read the U.S. Department of Labor (DOL) Field Assistance Bulletin.
Prior to this change, the decision to participate in a tip pool was left to employees. For more context on the issue, check out Tipping the Scales (Oregon Business, April 2018). The Bureau of Labor and Industries (BOLI) FAQ may answer any additional questions regarding tips at Oregon.gov/BOLI.
Restaurant Employee Compensation Tools
With tip pooling being legal with back of the house employees, employers may have questions about what their options are. ORLA launched a Restaurant Compensation Solutions Workgroup to review tools being implemented in restaurant operations across the state, including mandatory service charges, tip pooling policies based on sales that assist in compensating kitchen staff, and dual tip lines notating tip options for both servers and kitchen staff.
Tip pooling policies should be carefully reviewed with counsel before implementation to ensure compliance with all applicable requirements. For more on this subject, click the links below.
For additional questions, contact Greg Astley, Director of Government Affairs, at 503.682.4422.
This is for general informational purposes only. The information is not, and should not be relied upon or regarded as, legal advice. Please consult with your legal advisors.
Compliance extension and clarifications to single-use plastics
Ordinance No. 189537 – passed 6/5/2019; effective 7/5/2019
The City of Portland extended the compliance date for their restrictions on single-use plastics, moving the date from July 1, 2019 to October 1, 2019. They intended to give businesses more time to adjust given the impact of SB 90, which preempts local code.
It also clarifies that plastic utensil self-service stations for restaurants with counter service will still be allowed. There is also an exemption for plastic serviceware that is attached with a beverage container by the manufacturer (e.g. juice boxes), or when an ingredient like salad dressing is packaged with single-use plastic. All meals provided as a social service to vulnerable populations are exempt.
For online orders, dining establishments must coordinate with third-party ordering services to allow for the customer to request plastic serviceware. Compostable and biodegradable plastic are included in the definition of single-use plastic and are banned, but non-plastic material serviceware is allowed.
Short-term rental registration requirements
Ordinance No. 189557 – passed 6/12/2019; effective 7/12/2019
After stalled negotiations with Airbnb and low compliance rates for short-term rental permitting, the City of Portland is following the lead of the City of Santa Monica, CA, which recently had its ordinance affirmed by the Ninth Circuit U.S. Court of Appeals. This ordinance states that home sharing platforms must either reach a pass-through registration data-sharing agreement with the City, or they can choose hosts from a registry of City-approved and permitted rental locations.
No transaction can be completed and no fees can be collected by the home sharing platform unless the short-term rental is on the City registry, or if the home sharing platform has come to an agreement with the City on pass-through registration data-sharing.
Home sharing platforms will be charged $1,000 per illegal booking transaction per day.
New, bipartisan legislation is being introduced in Congress to help hospitality businesses comply with the Affordable Care Act.
This legislation directs the Treasury Department to implement an alternative, prospective reporting system that couples secure data collection with the efficiency employers need. The voluntary prospective reporting system created under this legislation would make important data available during the Exchange enrollment process, rather than after a coverage year has ended, and streamlines the reporting requirements for employers and insurers. Additionally, it protects the privacy of individuals’ Social Security numbers, authorizes the electronic transmission of reporting information, and establishes oversight of reporting verification.
Both the National Restaurant Association and ORLA support legislation that streamlines employer process and provides individual consumers with much-needed safety nets, employers with relief from duplicative and confusing reporting requirements, and Exchanges with an additional tool to verify tax credit and subsidy eligibility.
Contact Greg Astley at Astley@oregonrla.org if you have received a “226J” letter from the IRS so he can share that information with our partners at the National Restaurant Association and help pass this important legislation.
Pacific Power has announced a new policy of proactively shutting down power if conditions warrant it, in an effort to prevent wildfires. "Public Safety Power Shutoffs may occur with little warning and last for several days. It is currently unknown when these outages may occur; our only indication from Pacific Power is that they will occur during instances of significant wildfire danger (hot, dry, and windy days)," as stated by Hood River County Health Department in a memo to all Licensed Facilities in Hood River County.
The areas affected include Josephine County in southern Oregon (Roseburg, Medford, Grants Pass) and Hood River.
In Hood River County, health officials announced that food establishments may not operate during prolonged power outages. Within 4 hours of losing power, all food establishments shall cease operating and serving food to the public. Even if a food establishment has a generator, without formal written approval from the County Health office (in advance), no food establishment may operate during a prolonged power outage. Actions may be taken to protect inventories; however, any food exposed to temperature abuse shall be discarded.
Pacific Power has stated:
1. They will alert account holders 3-7 days out when possible
2. They will alert account holders 48 hours in advance, then 24 hours, then 2 hours and then one hour in advance whenever possible
3. Conditions will have to be sustained and will include:
If you have questions, please contact Hood River County Health Department directly:
For more information, download the memo from Hood River County Health Department.
The Oregon Restaurant & Lodging Association (ORLA) has hired Nicole Peterson as its new Government Affairs Coordinator. Peterson will be the new steward of the Portland Kitchen Cabinet and its steering committee, focusing on grassroots engagement with restaurateurs and supporting their community building efforts.
“We are excited to have Nicole join our team at ORLA to add crucial capacity for our ongoing work in the Portland restaurant marketplace. Business models and paths to sustainability are changing rapidly and there are many opportunities to bring the strengths of restaurants to more Portland community conversations,” said Jason Brandt, President & CEO.
Nicole previously worked as a Research Assistant for a state and local government affairs team in Illinois and worked on a variety of issues from happy hours to baseball stadium renovations. Since moving to Oregon, she has worked in local government, giving her a broader understanding of the issues from the governing body perspective. She received her bachelor’s degree in Social Policy from Northwestern University.
In her new role with the Portland Kitchen Cabinet, Nicole relishes the opportunity to help Portland restaurants and the broader community gather, collaborate, and flourish by providing more opportunities for community engagement and advocacy for the industry. This group of informed, active and motivated hospitality community members serve as industry ambassadors with policymakers, opinion leaders, community leaders and partner organizations. With more than 100 members, the Portland Kitchen Cabinet is a proud partner of the Oregon Restaurant & Lodging Association and the National Restaurant Association.
On June 30, the Oregon Legislature officially came to a close. The 2019 session was marked by hyper-partisanship, two walkouts by Senate Republicans and dozens of new laws affecting the hospitality industry. Several key bills will affect how restaurants and lodging properties conduct business in the near future. Watch for ORLA's full recap of the session coming soon to the Advocacy page.
Here are a few quick updates:
HB 2005 – Paid Family and Medical Leave
SB 90 – Plastic Straws on request
Plastic straws in restaurants are now only available “on request” unless a customer is using the drive through and then employees may ask the customer if they would like a straw. Effective as of June 13, 2019.
HB 2509 – Plastic Bag Ban
Single use disposable plastic bags are banned from restaurants and grocery stores. Retailers may charge for paper bags. Effective date is January 1, 2020. Read HB 2509 Enrolled.
HB 3137 – Collection of local lodging taxes by Oregon Department of Revenue
Provides that transient lodging tax becomes due when occupancy of transient lodging with respect to which tax is imposed ends. This bill will help eliminate the issue of properties collecting and remitting the lodging tax to the state and then if a customer cancels, having to go back and recover the lodging tax paid in order to refund the customer the tax. Effective date January 1, 2020.
SB 248 – Increase in certain fees charged by OLCC
Fees for OLCC licenses will double effective July 1, 2019. Negotiated separately from this bill is the option to renew an OLCC alcohol license every two years instead of annually.