Standing in the Way of Adjournment

As legislators continue to push for adjournment, which could come as early as June 17 or 18, several issues stand in the way.

  • GENERAL FUND BUDGETS:  So far, only one major general fund budget – the K-12 schools budget – has cleared the legislature. And, even there, House Democrats are pushing for more school funding out of the Education Stability Fund to cushion the blow of teacher layoffs and school closures.  Budgets for human services, higher education and public safety should begin moving through Ways and Means subcommittees this week to meet the  leadership-imposed deadline of June 7 to act on all state budgets.
  • HEALTH CARE FUNDING CONTROVERSIES:  The health care budget has been particularly controversial. Four legislators – Senator Al Bates, D-Ashland, Senator Betsy Johnson, D-Scappoose, Rep. Tina Kotek, D-Portland, and Rep. Tim Freeman, R-Roseburg – have been negotiating with leaders of the Oregon Association of Hospitals and Health Systems (OAHHS) to increase the hospital tax, reducing deeper cuts in the state's Medicaid budget. They agreed to impose a tax increase, which can be implemented without legislative action by the Oregon Health Authority.

Hospital representatives are still trying to understand the scope of what the new tax money – a combination of state hospital tax proceeds and the federal matching funds they generate under Medicaid – will pay for.  It is still possible that the OAHHS Board might sign off on the tax deal. It also appears that the solution will be incorporated in the Oregon Health Authority budget (House Bill 5529) as it moves toward final action in the Ways and Means Human Services Subcommittee this week.

While the hospitals were negotiating the hospital tax, representatives of Oregon's commercial health insurance industry were negotiating on what to do with "excess" proceeds arriving from a commercial insurance premium tax imposed in 2009. Proceeds from the tax were supposed to fund additional health insurance under the state's Healthy Kids Program, but more money arrived than was necessary to fund the new insurance – about $30 million more in fact. Negotiators – the same legislators and representatives of Providence Health Plans, Kaiser and Regence – reached agreement that the $30 million would go two places:  (1) $10 million would be used as a reserve for additional Healthy Kids enrollments and (2) the remaining $20 million would be allocated to back fill prospective reimbursement cuts for primary care doctors, including pediatric physicians.

  • PUBLIC RETIREMENT SYSTEM (PERS) REFORM:  Senator Richard Devlin, D-Tualatin, Senate co-chair of the Joint Ways and Means Committee, was quoted over the weekend as saying there is still time for the legislature to deal with PERS reform bills. It will be nothing if not interesting to see if his prediction comes true. Some members of the public often wonder why there is not a higher priority on PERS reform when the system costs so much and results in higher bills for already hard-pressed local and state government agencies. But PERS reform is tough to pass in the face of solid opposition by public employee unions who jealously guard what they view as "their" benefits.
  • PUBLIC RECORDS:  Attorney General John Kroger started out this session with aggressive plans to reform Oregon's public records law, contending his effort was designed to increase transparency for the public. Apparently, he failed to reckon with the difficulty of doing so in the face of strong opposition from government agencies, which contended they had worked hard to follow the current public records law and didn't deserve Kroger's suspicion. Kroger also was not interested in compromise. Lobbyists for the Oregon Newspaper Publishers Association and the Oregon Association of Broadcasters were at the table, but were not able to bridge the divide between Kroger and state agencies.
  • KICKER REFORM AND TAX CREDITS:  Some legislators are still pushing kicker reform proposals that would allow the state to salt away more money in the Rainy Day funds as a hedge against future economic downturns. One of the proposals advanced by Senators Ginny Burdick, D-Portland, and Frank Morse, R-Albany, merges kicker reform with a reduction in the capital gains tax. All of the proposals are controversial and most observers don't give them much chance of passing before adjournment. A range of tax credit bills, including for the controversial Business Energy Tax Credit program, could begin moving in the next week or so, but the outcome is in doubt.
  • CHILDREN AND FAMILIES RESTRUCTURING:  When Governor Kitzhaber took office, he announced a major proposal to form an Early Learning Council and merge all programs serving children and families into it. Now, about six months after taking office, it appears likely that the legislature will follow the governor's recommendation and create an Early Learning Council, but no one is yet sure when the change will occur. Rep. Tina Kotek, D-Portland, wants it to occur almost immediately and has introduced legislation (House Bill 3086) to create the Council and eliminate the State Commission on Children and Families as of July 1, 2011. She also wants to grant local children and families commissions several months, as she puts it, "to re-purpose themselves" in line with the priorities of the Early Learning Council.  Another bill in Ways and Means, Senate Bill 909, provides more time until the State Commission on Children and Families is eliminated. It is not clear which bill, HB 3086 or SB 909, will prevail.
  • REDISTRICTING:  This issue has become one which overlays almost every other issue. Sometimes, legislators get irritated at members of the Redistricting Committees and express their irritation by holding off action on bills – you know, the one bad turn deserves another kind of response.  Most observers are betting that this legislature will not produce a redistricting plan acceptable to both sides and, then, the task falls to Democrat Secretary of State Kate Brown.


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[CFM partner Dave Fiskum is involved in some of the issues outlined above as a lobbyist for health care, broadcast, children and families, environment, technology and other interests.]