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Entries in Vic Atiyeh (3)

Tuesday
Jul222014

The Passing of an Oregon Hero

The passing of former Oregon Governor Victor Atiyeh earlier this week has prompted an outpouring of positive comments about the last Republican governor in Oregon, both for his accomplishments as well as for the positive way he conducted himself while he held the state's top political job.

Memories abound for me because I had the privilege of serving in the Atiyeh Administration and did a stint as the Governor's press secretary. 

Senator Peter Courtney captured the man well in his tribute:  "Governor Vic Atiyeh was a kind and gentle man. He had a great smile and a great way of dealing with people. He was the ultimate public servant in the truest sense of the word. There was no greater role model.  He led our state during the most difficult of times. He found a way to make things work when everything was going against us. He brought out the best in people by appealing to the best in each and every person. He never focused on the negative. Oregon is saying goodbye to one of its greatest statesmen and one of its most remarkable citizens."

Here is a quick collection of my own memories:

Coming back to Oregon:  After working in Washington, D.C., for Democratic Congressman Les AuCoin, I returned to Oregon and joined the Republican Atiyeh administration.  Like AuCoin before him, Victor — as we sometimes called the Governor — never asked me or any other staff member about political affiliation.  The only question was whether I could do the job. (AuCoin didn't ask about my political affiliation, either, in what was in the 1980s a far different political moment.)

The governor's favorite sayings:  His staff heard certain phrases repeatedly, so much so that they stick in my mind today, 30 years later. He liked to say, "Well, that's just part of the great pageant of life."  Or:  "There never are any problems — just opportunities." Or, as The Oregonian paraphrased this week, "You can do a lot if you don't care who gets the credit." 

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Thursday
Dec132012

Canny Tax Policy Works for Oregon

There is nothing new or novel about Oregon using tax policy to lure or retain major manufacturers, as Governor Kitzhaber has proposed to clear the path for a major Nike expansion.

Oregon has maintained its stake in the competitive manufacturing sector over the last two decades by a canny approach to tax policy.

Governor Kitzhaber’s proposal this week to create a tax policy guarantee for large manufacturers such as Nike is the latest in a line of proposals dating back to 1984 when Oregon lawmakers repealed the state’s worldwide unitary tax.

The circumstances through the years have been the same — state leaders needed effective ideas Oregon could afford to attract or retain major employers. Clever tax policy did the trick.

The 1984 repeal of the unitary tax occurred during an economic downturn and threats by Japanese and other foreign companies to black list Oregon. Repeal of the unitary tax wound up causing only a scant tax revenue drop, but rolled out a red carpet to companies such as NEC and Epson that responded by quickly building manufacturing plants in Oregon.

In the early 2000s, manufacturers complained that Oregon’s tax apportionment formula penalized them for having large physical footprints and lots of employees. The 3-factor formula weighed property value, employees and in-state sales equally to determine their tax liability.

Lawmakers recognized the tax disincentive for companies such as Intel and Precision Castparts to keep investing here and adding jobs. They modified the apportionment formula to give double-weight to in-state sales.

Under continuing pressure from the manufacturing sector, and competition for their jobs by other states, Oregon lawmakers agreed to phase out the 3-factor formula and replace it with an apportionment scheme that just considered in-state sales.

That change eliminated the penalty manufacturers felt when they expanded their operations and hired more workers. It undoubtedly reduced state corporate tax bills, but the addition of more, often higher-paid workers increased personal income tax collections. On balance, the state achieved a net positive economic benefit.

Local communities also benefitted from higher industrial property valuations that helped pay for schools and firehouses, while demanding relatively few public services. New workers bought or built homes and shopped in local stores.

Kitzhaber’s latest idea basically enshrines the latest good idea for manufacturers who promise to make sizable investments and create jobs. It doesn’t cost anything, but it will reap dividends by once again helping Oregon stand apart from the crowd — California, Arizona and Colorado and cities such as Austin and Raleigh-Durham.

Some may question Kitzhaber’s haste in summoning lawmakers to pass tax legislation undeniably intended to entice Nike to stay and expand. But it’s no different than Governor Vic Atiyeh who summoned a small group including us 20 years ago to count votes on repeal of the unitary tax. Oregon’s sizable, productive and diverse manufacturing sector is the evidence of a smart, cost-effective strategy that still works.

[Pat McCormick represented the Oregon electronics industry and Gary Conking worked at Tektronix in 1984 and lobbied for repeal of the unitary tax. They later collaborated to found a Portland-based public affairs firm.]

Monday
Feb202012

Oregon's Last Republican Governor

A piece in the Salem Statesman-Journal brought back a lot of memories for me.

In a column entitled "Atiyeh Laid Foundation for Oregon Economic Diversity," state government reporter Peter Wong recalled the last Republican governor of the state, Vic Atiyeh, who is approaching his 89th birthday. He still goes to his office in Portland and often shows up for ceremonial events at the Capitol he loved where he served as a state senator and held the governor's office for eight years.

I had the privilege of working for the Atiyeh Administration from 1979 through 1987.

Here are excerpts from Wong's piece:

"He (Atiyeh) turns 89 on Monday – and this month also marks 30 years since he took part in the longest special session of the Oregon legislature in state history. Officially, that session lasted 37 days, ending on March 1. But lawmakers took a weeklong break in the middle of the session after they found that the gap between tax collections and state spending was $100 million more than had been projected.

"The unlikely combination of a Republican governor and Democratic legislative majorities — with some Republican support — cut spending and raised taxes to balance the budget. They started the two-year cycle in mid-1981 with a spending plan for $3.2 billion — the Oregon Lottery did not exist then — and ended it with $2.9 billion, even after the tax increases. The unspent balance in the tax-supported general fund was around $3 million.

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