In This Issue Revenue and Tax Reform Governance Natural Resources Social Policy Education Policy Revenue and Tax Reform By Chris Vogel, Revenue and Tax Reform Senate Committee on Finance and Revenue: SB 1528 had earlier language to limit the Oregon state pass-through tax, that the League supported, but it was stripped from this bill in […]
Initiative Petition 22, “Stop Oregon Sanctuaries,” is currently under Secretary of State investigation for misrepresentation of its intent to signers. They cannot remove your signature. The League has gotten complaints of ongoing violations. See our Think Before You Ink. The League urges you to read petitions carefully.
Clean Energy Jobs is still alive-until it isn’t. The League continues to press the “urgency of now” when it comes to climate change. With many policy bills about done, the focus goes to the budget to implement good environmental laws. Watch Ways and Means Subcommittees this coming week.
Health Care bills grab our attention. HJR 203 A, a constitutional amendment establishing the right to health care for every resident of Oregon, was heard in Senate Health Care and is still being considered for amendments.
The Joint Committee on Student Success will not hear any specific bills this session, but has committed to conduct public hearings and individual conversations with students, teachers and other stakeholders throughout the state before the 2019 legislative session.
Senate Committee on Finance and Revenue: SB 1528 had earlier language to limit the Oregon state pass-through tax, that the League supported, but it was stripped from this bill in amendments.
Mid-Session Update from Salem
With the half-way point of the “short” 2018 Session behind us, the pace has slowed in the House but accelerated in the Senate. The reason is mathematical. There are twice as many Representatives as Senators, and House Rules allow Representatives two bills each, while the Senate has limited itself to just one. That means the Senate has introduced only one-quarter as many bills as the House.
Measures on the move are now mostly in the Senate unless they need money to implement and have been referred to the Ways and Means budgeting committee. Ways and Means is a “joint” committee made up of both Senators and Representatives. More than 100 requests that have a fiscal impact have been sent to the Committee with the total “asks” far exceeding the funds available.
In the Senate last week, the major decision was a bill determining the Oregon tax rate for some small businesses with pass-through income. As currently written, SB 1528 would adjust Oregon tax policy in response to the recent federal tax changes.
Affected businesses include S corporations, LLCs, and some business partnerships — categories that include most smaller “mom and pop” businesses. “Pass-through” refers to the fact that profits for these types of businesses are passed to the owners and taxed as personal income. As personal income tax rates are generally higher than corporate rates, a small business usually pays a higher tax rate than larger corporations. I think that is poor public policy!
The problem is that nearly half of the new benefit goes to people making more than $455,000 annually. According to the non-partisan Legislative Revenue Office, if the new federal tax break remains in state law, Oregon stands to lose roughly $120 million in the current budget. But if lawmakers act to keep the federal deduction out of state law, the state budget would retain about $140 million in revenue. And significantly, Oregon already offers a tax break to pass-through entities.
Opponents argue that SB 1528 amounts to a 20 percent increase in taxes for small businesses. Supporters respond that businesses should not get two Oregon tax breaks, that businesses have yet to take advantage of this new provision, and that without it, the tax rate for these businesses will be the same as last year, so it can’t be considered a tax increase. Both positions have some merit.
This conversation is not over. The measure now comes to the House where we will be looking hard at how to protect smaller businesses, limit new tax breaks to the wealthiest Oregonians, while also safeguarding state revenues in the face of these complex changes from Washington, DC.
High profile votes in the House last week included:
• HJR 201– a constitutional referral to Oregon voters that would make it easier for local jurisdictions to finance the costs of developing affordable housing.
• HB 4018– providing increased transparency and accountability for the coordinated care organizations (CCOs) that serve Oregon’s Medicaid population.
• HB 4113– allowing educators to discuss class size when negotiating their contracts.
• HB 4141– increasing transparency in the tuition-setting process and giving students a larger voice in the process through the creation of tuition advisory council.
Coastal Art and Coastal Artists
Each session, I invite artists from our district to display their work in my capitol office.
The collection being showcased this month is by Waldport resident Virginia L. Leonnig.
Capitol regulars have recognized an amusing irony in the newest display. Many of the colorful oil paintings feature sky lanterns – those light paper balloons heated by an open-flame fuel source and turned loose to float where the breezes take them. Two years ago, I authored and passed legislation prohibiting their use in Oregon as a fire hazard!
As an added irony, one painting (shown above) is titled “Remembering Dave” (no relation).
To be considered for a one month show during the 2019 legislative session, please send me an email.
Gomberg Bills on the Move
My measure to ease red tape for small business, HB 4052, has passed the House and will be voted on in the full Senate this week.
My Equifax Breach Bill, HB 4147, which would prohibit fees for freezing your account if a credit monitoring company gets hacked has stalled in the House. A similar bill, SB 1551, has been introduced and passed in the Senate and appears to be moving in the House. I have signed on as a sponsor of that measure as well.
My PERS Reform bill, HB 4046, which would prevent “spiking” PERS retirement benefits with outside income has passed the House and will be considered in the Senate this week.
My committee bill to help small business recover from disasters, HB 4025, has been approved by the Committee on Economic Development and Trade and has been sent to the Ways and Means Committee.
Finally, my bill to help shelter dogs and cats, HB 4045, is unlikely to move forward in 2018 but will be re-introduced in 2019. [www.statesmanjournal.com/story/opinion/editorials/2018/02/15/legislature-should-have-advanced-puppy-mill-bill/342373002/]An editorial in the Statesman Journal was very supportive of the bill and critical of the decision to let it languish.
To review any of these bills in detail, click here.
Housing and Economic Development
Those of you interested in the issue of housing and how the shortage of workforce housing relates to and affects local and rural economies will be interested in a hearing I organized in my Committee on Economic Development and Trade last Wednesday. That session looked at how the statewide housing shortage translates into trouble finding workers, lost productivity or business closings, and more automation of service work. Click here to watch the hearing in full.
Thanks again for your interest in your legislature and our remarkable district! If I can be of any assistance, please don’t hesitate to send me a note.
Rep. David Gomberg
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ACTION ALERT! Support Clean Energy JobsDate: February 24, 2018To: All League Members and OregoniansThis legislation will establish a program to cap climate pollution, price all qualified greenhouse gas emissions under the cap, and invest the proceeds in clean energy, while addressing the needs of vulnerable communities and investing in training workers for new, growing opportunities in a clean energy economy.The House Bill timeline recently changed. On Feb 20 an amendment (-12) was introduced by House Speaker Tina Kotek, that would Cap Greenhouse Gas Emissions legislation this session and would allow the trade and invest details to be addressed next session. Details in a Portland Tribune article or OLIS.The League asks that you let your legislator know the urgent need to address meaningful Climate policy is now.ACTION NEEDED, we need you to contact your legislatorsVisit your legislators in the next week. If that’s not possible then make a phone call and or write a personal email or letter. You can find your legislators’ contact information here.For more information, contact Claudia Keith, Climate Change Portfolio Chair, email@example.com