 * “I am only one, but still I am one. I cannot do everything, but still I can do something; And because I cannot do everything I will not refuse to do the something that I can do.” —Helen Keller
Welcome to the May 28 edition of Do What You Can Do.
We're excited for our first ever virtual town hall tomorrow night (Wednesday, May 29th) at 7 PM! See details below.
Now back to your regular programming.
A lot, actually. The substantive policy committees, including my Campaign Finance Committee, have closed down, with a lot of unfinished bills passed on to the powerful committees that stay open until the session ends June 30: Senate Rules, House Rules, and the Joint Ways and Means Committees. Some bills will die there either from lack of support or opposition from leadership, and some will probably die because there's simply not enough time to get to them all. That problem increased recently because the Republican minority in the House is now refusing to suspend the rule that requires that bills get read from the dais in their entirety before a final vote. This is a "run down the clock" tactic designed to shorten the list of bills that can pass over the minority's objection. And one result is that instead of doing their essential committee work, House members are stuck on the House floor for hours every day as the bills, some 50 pages or more, are read out loud.
The picture should be clearer this week on what legislation does and doesn't have remaining signs of life. This week I'll focus on one big bill that just passed the Senate in a troubling way.
The PERS Problem
The spotlight of the last newsletter was HB 3427, the Student Success Act, which enacts a roughly $1 billion/year corporate activities tax on the largest 10% of Oregon businesses, investing the money strategically (and I think intelligently) in public education. It's Oregon's first significant consumption tax, and passed both chambers by the 60% majority required to raise revenue (18 in the Senate, 36 in the House) without a vote to spare. The Governor signed it into law on May 20.
 Governor Brown signing the Student Success Act
But it came with a condition. Oregon's largest business leaders agreed to stay neutral on the bill--meaning they won't fund a ballot measure to repeal the tax--if and only if we also passed a bill to reduce what's known as the PERS unfunded liability. This is the debt that public employers--schools, cities, counties, the state--have going forward to pay their employees the pensions they were promised in lieu of wage increases in the past. And the amount has grown astronomically, because many of the pensions guaranteed a rate of return on investment (known as a "guaranteed benefit" program) that is higher than the investment markets have been returning. The employers--various governments and school districts--are legally obliged to make up the difference.
Just about everyone who looks at that guaranteed-return agreement, fixed in contract more than 30 years ago, wonders, "What were they thinking?!" Whatever the answer to that might be, it's created what amounts to a $27 billion obligation to retirees. The courts have struck down legislative attempts to change the terms for people who have already retired, which makes up a large majority of that staggering figure. Over the years the legislature has managed to reduce the public employees' benefits package--that's why you hear about Tier 2 and Tier 3 employees, with much less generous pensions than the original Tier 1 folks, most of whom have retired with legally untouchable pensions.
Meanwhile, the payments that governments and school districts are required to pay on the debt are tearing big holes into their budgets, causing lay-offs and big gaps in basic services. Just about everyone agrees we have to do something about this. What, exactly, is a different question.
 SEIU members protesting proposed PERS changes. Photo courtesy of Claire Withycombe
Proposed Reform: SB 1049
That brings us to SB 1049, the PERS bill that moved with lightning speed to the Senate floor last week to protect the Student Success Act from a repeal attempt. It's complicated. Basically it answers, "Where should the money come from?" with three basic sources:
- An extension of the debt's amortization period from 20 to 22 years. This is just as if you extended you home mortgage to have smaller monthly payments in return for paying for extra years, and results in paying more overall.
- A relatively small amount from a still-developing source called the sports betting lottery. Nobody knows how much this will be or how it will work.
- A reduction of retirement benefits for currently-working and future public employees who earn $30,000 or more.
Number 3 is the rub. While there's resentment for the size of the pension that some public retirees are drawing, nobody's saying (at least out loud) that current employees, with much leaner retirement deals than Tier 1 employees, are overpaid. In fact, more and more school districts and public agencies report difficulties recruiting qualified people because pay packages aren't competitive.
 Senate President Peter Courtney. Photo courtesy of Logan Gilles
That didn't keep legislative leaders from putting together a PERS bill that takes a toll on one and only one narrow segment of Oregonians, many of whom have challenges paying basic monthly bills. Some argue that this bill won't really cost them much (example: a state employee who's worked for more than ten years at a $40,000 salary will lose about $300 per year). Whether or not that rings true to you, the core message of this bill is that the PERS burden should be solved by public employees who had nothing to do with the long-past decisions that created it. That's wrong, and I said so in my floor speech before the vote.
I wasn't very persuasive. The bill passed with the minimum 16 votes necessary, 11 Democrats and 5 Republicans. It now moves to the House of Representatives.
A feeling of disappointment, not just about this vote but about the broader legislative dynamics I think it brings to light, stayed with me over the weekend. To cope with it I wrote this short commentary, part of which I delivered on the Senate floor this morning. I don't have much reason to think that it will have any more influence than did my floor speech before the vote. But I'm open to pleasant surprises.
Last week we asked, "Do you want new laws aimed at reducing gun violence? If so, what one or two specific provisions would you most like to see become law?" Here's what some of you wrote in:
- "(1) Making automatic weapons illegal. (2) Preventing unstable people or felons from obtaining weapons. (3) Increasing the penalties for gun-law violations."
- "I would love to see gun regulation move in the direction of what Japan has in place. If [someone wants] to own a gun, they must attend an all-day class, pass a written test, and achieve at least 95% accuracy during a shooting range test. Then they have to pass a mental-health evaluation, which takes place at a hospital, and pass a background check, in which the government digs into their criminal record and interviews friends and family. They can only buy shotguns and air rifles - no handguns - and every three years they must retake the class and initial exam."
- "(1) Concealed handgun reciprocity so that Oregon would recognize other state's licenses, beginning with Washington state. (2) Hardening our schools by allowing (and providing compensation) for school employees who desire to receive training to conceal carry at work."
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Photo courtesy of ODOT
This week: You'll notice that one of my Senate floor comments today was that, "There are dozens of potential ways to pay this [PERS] debt." That could range from higher top-end income taxes, a small surtax on all income taxes or on property taxes, a new beer and wine tax, raising property tax assessments on commercial and industrial properties closer to market value, or...? What would you choose as the fairest, most acceptable way to raise significant dollars to pay down the PERS debt? And, at least as important, should you pay some of them? Send your thoughts to sen.jeffgolden@oregonlegislature.gov.
Missed our Medford town hall? Don't worry, tomorrow we have our very first virtual town hall! We will be live-streaming on Facebook tomorrow night (5/29) from 7-8PM, talking about what's going on up in Salem and answering your questions. Please email your questions to sen.jeffgolden@oregonlegislature.gov with the subject line "Virtual Town Hall" so we can make sure to get to everyone. See you tomorrow!
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Have you checked out Capitolizing? It's the weekly podcast where Senator Shemia Fagan and I answer two questions every week: What do we do here in the Capitol, and Why the hell should you care?
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Our best to you for now. Please remember to do what you can do.
Senator Jeff Golden
Chair, Campaign Finance Committee
Senate District 3 (Rogue Valley)
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