Brighter Oregon influenced discussions on the state budget
Beginning December of 2016 and throughout the 2017 legislative session, Brighter Oregon, the Oregon Business Plan coalition, advocated for a three-prong framework.Beginning December of 2016 and throughout the 2017 legislative session, Brighter Oregon, the Oregon Business Plan coalition, advocated for a three-prong framework. The framework is based on shared responsibility to 1) grow the economy; 2) slow runaway costs in state spending, particularly related to public employee compensation and health care; and 3) consider new revenue tied to specific results, such as improved K-12 and higher education outcomes. On June 22, Governor Brown, Senate president Courtney and House Speaker Kotek announced they would not move forward with structural spending reforms or new revenue this legislative session, rejecting the specific plans brought forward by Brighter Oregon to help address the state’s $1.4 billion budget deficit and put Oregon on a long-term path to fiscal stability.
Prior to the announcement from leadership, the focus of the Legislature, led by Senator Mark Hass, had been on enacting a gross receipts tax to replace the corporate income tax. That effort failed due to lack of progress on cost containment and widespread business opposition. During that same time, Patrick Criteser, chair of the Oregon Business Plan, testified before the Joint Committee on Tax Reform about the need for meaningful cost containment and laid out a framework to raise $500 million in additional business tax revenue through changes to the existing tax structure to raise revenue for new investments if structural cost reform was achieved. Brighter Oregon representatives also testified before the Ways and Means Capital Construction Subcommittee on specific cost control measures contained in HB 1067, which do not go far enough to achieve meaningful reforms. A bill that contained proposals to rein in the growing Public Employee Retirement System costs never received a hearing.
Despite the lack of progress this session, Brighter Oregon successfully changed the narrative about how to address the state budget and there is now an awareness among legislators that cost containment ultimately must be a part of any long-term solution. Brighter Oregon has consistently laid out its vision for sustainable fiscal health, garnering positive earned media responses from editorial boards throughout the state. Additionally, the coalition generated about 5,000 emails and calls to legislators from their constituents about the importance of the state living within its means to ensure a more sustainable, long-term fiscal solution. Visit www.brighteroregon.com to learn more.
Meanwhile, the Legislature passed legislation to address the portion of the state’s budget deficit caused by the Medicaid program. This includes a 1.5 percent premium tax on health care insurance, much of which will ultimately be paid for by businesses. That premium tax level exceeds levels the coalition was prepared to support, however, the bill is expected to be signed by the governor.
Finally, the House of Representatives passed HB 2060 on a party line vote, which rolls back the tax credit for small pass-through businesses. The bill was first enacted in 2013 as part of the “grand bargain” on PERS and corporate taxes. The legality of passing the bill without a supermajority vote would likely result in legal challenge, and Alliance supported the efforts of partners in the lead on stopping this bill. The bill now sits in the Senate, which has indicated it will not move this legislation forward.