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  1. #1
    dennison Guest

    Default Liberty Caught Getting Secret Tax Breaks

    Now this is a good one:

    Liberty Caught Getting

  2. #2
    mjc Guest


    Thank you as that is real interesting. I am presently in a battle with Liberty Mutual. I enjoy finding out things of that nature.......Bunch of Snakes In The Grass. Is there any way you can tell me what the date was for that article in the Oregonian as I would like to read the entire article. I will be on a hunt with that company myself since they are causing me as much heartache as they possibly can. I know if the outcome is not to my satisfaction, I have the name and telephone number of a lawyer I will be contacting. Thanks for sharing that info. Take care!

  3. #3
    dennison Guest


    Glad to help,

    It appeared in the Oregonian on 10/11/04,
    Here the entire article right from the OREGONIEN

    Deal gave Liberty a tax break
    Nine years ago, insurer Liberty Northwest arranged to pay no taxes on its corporate profits to Portland or Multnomah County
    Monday, October 11, 2004

    SALEM -- Brian Boe welcomed the chance to explain to state senators why his company, Liberty Northwest Insurance, found it so hard to compete against Saif Corp.
    Appearing before a legislative committee last summer, the Liberty Northwest vice president ticked off the state-run company's advantages, "not the least of which is the tax-free accumulation of income."

    Boe was alluding to Saif's exemption from federal income tax -- a tax that annually costs Liberty Northwest millions.

    The insurance executive told the senators his company just wanted fair competition in selling workers' compensation insurance to Oregon employers.

    "We are far more concerned with survival than we are with domination," Boe said.

    What Boe didn't tell legislators is that Liberty Northwest has its own tax loophole, arranged nine years ago by company lobbyists at the Oregon Legislature.

    Because of the tax break, Liberty Northwest pays no taxes on its corporate profits to Portland or Multnomah County and is spared the TriMet payroll tax. The loophole applies only to Liberty Northwest.

    Authorities with the city of Portland, Multnomah County and TriMet say they have no way to estimate what Liberty Northwest is saving in local taxes. Liberty Northwest hasn't done the math either, Boe told The Oregonian, because "such estimates would involve complicated allocations."

    Estimates calculated by The Oregonian based on the company's public financial statements put the figure at about $400,000 a year.

    Liberty Northwest is putting millions into the campaign for a November ballot measure that would put Saif Corp. out of business. Liberty and its allies say Saif's advantages threaten to drive private companies out of the Oregon marketplace.

    Boe said Liberty compensates by running leaner and living with less profit.

    Liberty Northwest posted a $5.7 million profit last year while Saif lost $28.5 million, according to financial statements filed with regulators.

    Liberty officials see tax status as a key Saif advantage. Although Saif writes no federal tax checks, Liberty Northwest paid $5.9 million in federal income tax in 2002 and $12.5 million in 2003.

    Liberty Northwest recently estimated that if Saif did pay federal income taxes, its bill the past 10 years would have been between $85 million and $595 million. Their calculations are being reviewed by legislative staffers.

    Forcing Saif to pay such taxes would take money set aside for injured workers or for rebates to Oregon employers, said Brenda Rocklin, interim Saif president.

    Tax perk not disclosed

    Liberty Northwest hasn't disclosed its own tax advantages in its drives at both the Legislature and the ballot box to clip Saif's operations. The tax perk was arranged so quietly at the Legislature that state Insurance Division officials weren't aware of it until The Oregonian asked about it last week.

    Legislative records; internal insurance industry documents; and interviews with lobbyists, insurance industry officials and regulators reveal how the loophole was crafted.

    State officials went to the Legislature in 1995 to solve an expensive problem. Out-of-state insurance companies, including Liberty Northwest's parent, had sued the state, claiming they were taxed unfairly. They had a recent U.S. Supreme Court case on their side and they were demanding refunds from the state totaling millions.

    State officials and the industry negotiated a treaty. The state would cut tax costs for out-of-state companies if the insurers dropped their case. The effort was tough, participants say, but they recall then-Democratic Gov. John Kitzhaber pressing to close the deal.

    Part of legislation drafted to fix the problem changed how Liberty Northwest was taxed. Under the new law, the company would be treated as an Oregon business instead of an out-of-state company because it was owned by a Massachusetts insurer. The change would cut Liberty Northwest's state taxes but add local taxes paid by other Oregon insurers.

    With the Legislature days from adjournment, Liberty Northwest demanded one more change. It wanted to be treated as an Oregon company, but it wanted to keep its freedom from local taxes.

    Company officials made clear that without the special treatment, Liberty was going ahead with the lawsuit.

    Insurers cite unfairness

    Other Oregon insurers complained the loophole wasn't fair to them -- it spared Liberty a cost they had to bear.

    "We can think of no legitimate state purpose that is even arguably advanced by the special 'Liberty Northwest' exemption," an industry attorney wrote in a confidential memo later assessing the loophole's legality.

    A later confidential letter said the special exemption was "entirely the product of a back room deal."

    According to those who worked on the deal, Kitzhaber's staff insisted the Liberty Northwest loophole be granted to assure the lawsuit died.

    Nine days before legislators adjourned, a Senate committee convened in a hurried meeting.

    Lobbyist Fred VanNatta, representing Liberty Northwest, said the company "will withdraw the lawsuit upon passage of the measure with amendment," according to committee minutes.

    An assistant attorney general told the committee she had Liberty's promise in writing.

    Paul Phillips, a Republican senator chairing the committee, ordered the Liberty loophole put into the reform legislation and gaveled the meeting closed. The work hearing lasted five minutes.

    Les Zaitz: 503-221-8181;

  4. #4
    mjc Guest


    I found it when I pulled up the site. Sorry for any confusion but I was thinking it might not have been in todays newspaper instead of simply checking the site first. I live in a state of confusion and I guess today is one of them. Thank you!

  5. #5
    mjc Guest


    Thank you again, maybe now others can see this also. Our post crossed each other when I posted the above post. I have this article saved in a file.....just in case I need ot for future reference. Take care!

  6. #6
    dennison Guest


    Its all GOOD, we all go through days of utter confussion, I think I have been in a STATE of confussion for years,
    like Santa Claus said:
    I am checking my list I am checking it twice.....
    No kidding how about Three Four Five times.

  7. #7
    zoom Guest


    MJC, Recent articles in our paper have address Liberty Mutuals Gestapo tactics. Do a search in the Sacramento Bee. It hard to believe any reputable company can survive treating the American People this low.

  8. #8
    mjc Guest


    Thank you for the added info in the Sacramento Bee. Thank you so much both of you and anyone else that had info to share on Liberty Mutual. I can certainly use all I can get on that company. I am heading for the Sacramento Bee right now! Take care!

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