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Dear Friends,
Whew! Five weeks left in the 2019 legislative session and there’s a lot to report. We’ve checked off some big items on the to-do list, although others are still in play. At this point, we are working under extreme time pressure; the legislature is compelled to wrap up this session by June 30.
Despite the furor, we still have moments of reflection. Last week we honored the life and service of Officer Malcus Williams II, a beloved Ashland police officer who died a year ago while on a call. Officer Williams was one of 183 law enforcement personnel recognized on the House floor as part of our acknowledgement of National Peace Officers Memorial Day.
In the middle of the contentious state budget process, I’m grateful for the opportunity to honor the police officers, teachers, firefighters, bus drivers, and other public employees who provide essential services we sometimes take for granted. A thousand thanks to those who work day in, day out to make our communities function.
As always, please get in touch if you have questions, comments, concerns or criticism. I’m always glad to hear from you.
Best,
State Representative
Oregon House District 5 - Southern Jackson County
Ashland Town Hall, April 14, 2019. Photo Credit Dasja Dolan Creative Photography & Design
A year of work by the Joint Committee on Student Success culminated in a proposed package of investments in early learning and K-12 schools that was approved by the House and Senate and signed into law last week by Governor Kate Brown. I’m proud to have cast an AYE vote on this legislation.
The package is a long-overdue effort to provide schools with programs and services that support student achievement. Property tax reforms enacted in the 1990’s shifted two-thirds of school funding to the state budget, without any new revenue. Ever since, our schools have been struggling to adequately fund teachers and classrooms, even as the educational, social and emotional needs of our students have accelerated..
The Student Success Act will provide approximately $1 billion/year. At least 20% of that will go to programs that serve high risk children from birth to age 5, including early Head Start, relief nurseries, and early intervention. Another 50% will be distributed to school districts for school improvement programs that are chosen and implemented on the local level. Districts will be allowed to spend the new money for certain purposes, including expanded learning time, reduced class sizes, student health and safety, and provision of a well-rounded education. To receive funds, districts will need to create a spending plan; maximum allocation will depend on achievement of specific outcomes, including increases in graduation rates, attendance and third grade reading proficiency.
Here are initial projections of Student Success Act allocations for our local districts:
Ashland SD 5: $2.3 million
Butte Falls SD 91: $261,000
Central Point SD 6: $3.8 million
Eagle Point SD 9 : $3.2 million
Medford SD 549C: $11.8 million
Phoenix-Talent SD 4: $2.2 million
Pinehurst SD 94: $69,000
Prospect SD 59: $258,000
Rogue River SD 35: $926,000
A portion of new money will go to statewide initiatives that will apply across all districts. Those could include a longer school year, universal free meals, and other investments.
The Student Success Act will be funded by a new Commercial Activities Tax to be applied to total receipts of sales and services within Oregon. The surcharge, set at .57%, will not apply to a business’s first $1 million in receipts, and each business will be allow to subtract up to 35% of either labor or cost inputs.
Clearly, businesses will need to plan for the impact of the new tax. A billion dollars is a lot of money and will require significant adjustments for some businesses, though the surcharge is designed to spread a small tax across a large base to minimize impact on any particular sector.
Recognizing that the new tax may have an impact on consumers, the package also includes a reduction in certain personal income tax brackets to compensate for increased prices.
The Student Success Act is a game-changer for Oregon’s children and families. New money will have an immediate impact in our classrooms. In the long term, smart investments in our schools will produce a more capable and productive workforce and fuel economic growth.
A thank you card from Washington Elementary in Salem, May 20, 2019
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Last Friday, May 17, House Bill 2020 took a huge step in its trip through the legislative process, as the Joint Committee on Carbon Reduction voted to move the bill to the Ways and Means Committee. Climate action has been on the top of my priority list and I was extremely grateful to cast an AYE vote on the motion.
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In brief, this bill will establish a statewide cap on greenhouse gas emissions that will allow fewer and fewer emissions in years to come. Greenhouse gas emitting businesses covered by the program will be able to buy allowances, or “credits” toward the use of emissions. Credits will become more costly over time, spurring a transition to cleaner, more renewable technology. Everyone will know the rules, so businesses can plan.
The statewide emissions cap will incentivize behaviors that will protect jobs and produce further innovation. Companies that are particularly sensitive to price changes and market fluctuations outside Oregon will be encouraged to adopt the best available technologies. If they do so, their good practices will be rewarded with direct allowances they don’t need to purchase.
The proceeds of carbon credit sales will fund projects across the state to help Oregon deal with the impacts of climate change. In southern Oregon, this could include forest restoration, irrigation modernization, and new renewable energy projects.
HB 2020 will put us on a track to achieve reductions consistent with the international Paris Agreement, which seeks to limit global temperature increases to no more than 2 degrees Celsius during this century. Studies released since the Paris Agreement suggest we may have even less time than we thought to corral rising temperatures, so HB 2020’s emission goals need to be aggressive and immediate.
HB 2020 now heads to the House Committee on Ways and Means for consideration.
Oregon’s Public Employee Retirement System (PERS) is burdened by a $26 billion unfunded liability that, if left unaddressed, will force public employers – school districts, cities, counties and the state – to spend an increasing proportion of their budgets on retirement benefits for past employees. Even in the best of times, the increases in required contributions to the PERS system has led public employers to make painful cuts to teaching positions, school days, and other critical services.
Senate Bill 1049 seeks to reduce PERS costs in a way that is legally permissible, actuarially sound, and equitable. Proposed changes include extending the period in which the PERS debt is financed; requiring employees to divert personal retirement funds to help pay the PERS obligation; and minor program adjustments. I'm hoping we will have a clear path forward in the next few weeks.
The employee contribution would come from the individual account maintained by each employee. The defined benefit portion of each employee’s retirement, which is calculated on final salary and years of service, would remain untouched.
I've heard from many public employees who are deeply concerned about the possible diversion of any retirement funds. I understand the distress this proposal is generating among our teachers, firefighters and others. At the same time, I am convinced that we have to take bold action to stabilize the PERS system.
To be clear – doing nothing is not an option. If we fail to act, we risk much more draconian action via a ballot measure or, worse yet, by the collapse of the system. A PERS retirement is a great asset to employees and I will do everything I can to protect the defined benefit approach. However, protecting that benefit on the long term is going to require hard choices and some sacrifice.
The 2019 official fire season begins June 1, but we’ve already experienced more than 130 fires on land protected by the Oregon Department of Forestry. In early May, the Bray Mill Fire in Klamath County burned through 400 acres, and a few days later the Medco B fire near Butte Falls torched 300 acres. Consistent with our experience, the National Interagency Fire Center has predicted a heavy wildfire season for areas along the west coast.
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Our community needs a lifeline from the State of Oregon to help us prevent and suppress the fires we know are coming. Accordingly, I am advocating for the Oregon Forest Fire and Resilience Investment Package, which would provide funding in this biennium for wildfire resources, prevention work and long-term, smart investments that will help us create and sustain healthy forests and communities.
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Smoke and fire know no political boundaries, and several of my colleagues in the legislature have already signed on to back the package, demonstrating bipartisan support for high-risk, fire prone communities across the state. This funding proposal is a request for the Governor's budget, which is expected to be passed before the end of this legislative session.
Last Wednesday the state economist updated the revenue forecast for this biennium – and it was a doozy of an announcement. Since the most recent report three months ago, the state has received more than $900 million in unexpected revenues to add to the $500 million surplus we were already expecting.
As the economists ruefully reported, in any other state this would be great news, but Oregon’s kicker law requires that most of the money received in excess of predictions must be returned to taxpayers. As a result, we could be looking at a kicker of $1.4 billion, to be returned as a credit on tax filings in 2020.
A kicker of that magnitude would generate a $338 median return. However, the kicker formula is heavily skewed toward higher wage earners, with a projected return of as much as $14,000 to the top 1% of earners.
As a result of the kicker, Oregon is never able to benefit from good economic times – to sock some of that surplus away or to use it for important, one-time purposes. Yet, we always bear the responsibility for guiding the state through downturns. No one of us would manage our own family budgets by refusing to accept an unexpected bonus, but that’s the practical effect of the kicker on the state.
Since the kicker is constitutionally guaranteed, permanent changes to this process would need to be approved by voters. However, the legislature can retain all or part of the total kicker on a one-time basis with a 2/3 vote of both House and Senate.
I believe that one-time use of some of the kicker to address otherwise intractable statewide issues – like PERS – should be considered. However, that would require broad, bipartisan agreement among legislators. Absent that, the kicker will go back to the pocketbooks of taxpayers early next year.
Here’s a quick status update on a few issues that are generating interest in District 5 and at the Capitol.
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HB 2509: The proposed ban on single-use plastic bags has passed in the House and is now pending in the Senate.
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HB 2007: This bill to create stronger diesel emissions standards has been amended to focus on the Portland Metro area and is now pending in House Ways and Means.
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HB 2015: A proposal that would allow the Department of Transportation to issue or reissue a noncommercial drivers license to individuals without requiring proof of legal residency is pending in the Joint Committee on Transportation.
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SB 1008: Legislation to modify treatment of youth in the juvenile justice system is slated for a House Floor vote.
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HB 2619: I have signed on as a sponsor of the bill to ban chlorpryrifos, now pending in the House Rules Committee.
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HB 3063: This bill would eliminate personal exemptions for immunizations required for school attendance; action is suspended.
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Multiple bills to increase cigarette and inhalant taxes are under discussion in the House Revenue Committee.
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McDonald Creek streamside logging near Wagner Butte, April 2019
In 2017, the Siskiyous were excluded from new rules made by the Oregon Board of Forestry to improve riparian buffers for streams and fish on private forest land in western Oregon. Consequently, most of the Rogue River watershed is still under the old and weaker rules that do not reliably meet the Clean Water Act's water quality standards.
With help from Rogue Riverkeeper, residents and organizations are teaming up to ask the Board of Forestry to protect clean water and fish in our region.
On Wednesday, May 29, 6:00-8:00 pm at Talent Community Center, attend an informational gathering with a presentation about Siskiyou Streamside Protections, Q&A and opportunities to take action.
As the end of this legislative session approaches, please stay engaged by contacting my staff and me with your ideas, concerns and questions.
Capitol Phone: 503-986-1405
District Phone: 541-282-4516
Capitol Address: 900 Court St. NE, H-375, Salem, Oregon 97301
Email: Rep.PamMarsh@oregonlegislature.gov
Website: http://www.oregonlegislature.gov/marsh
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