Ted Wheeler

Oregon’s Primary a Microcosm of the National Election

    Political outsiders dominated in the Oregon primary as Democrat Bernie Sanders scored a double-digit win over frontrunner Hillary Clinton and newcomer Bud Pierce captured the GOP gubernatorial nomination.

 

Political outsiders dominated in the Oregon primary as Democrat Bernie Sanders scored a double-digit win over frontrunner Hillary Clinton and newcomer Bud Pierce captured the GOP gubernatorial nomination.

Oregon’s presidential primary Tuesday serves as a microcosm of the national election. Democrat Bernie Sanders keeps winning to complicate frontrunner Hillary Clinton’s pivot to the general election and Republican Donald Trump glided to victory even though 32 percent of Oregon GOP voters cast ballots for candidates who had dropped out of the race.

Republicans chose Bud Pierce, a first-time candidate who largely self-funded his campaign, to challenge incumbent Democratic Governor Kate Brown. Portland voters swept in Ted Wheeler as mayor-elect, Brad Avakian won a hotly contested race as the Democratic nominee for secretary of state, and Clackamas County will see a fall runoff for commission chair pitting Jim Bernard against incumbent John Ludlow.

Hood River County voters approved a ban on a water bottling plant, parting ways with voters in Cascade Locks who supported Nestlé Waters plan to build the facility there. Meanwhile, Klamath and Grant county voters rejected marijuana-related businesses, Portlanders narrowly okayed a 10-cent gas tax increase and Multnomah County voters gave solid approval to an Oregon Historical Museum bond.

The Sanders victory in Oregon defied widely published polling results that showed Clinton holding a double-digit lead. With almost 90 percent of the vote counted, Sanders posted a 12 percent lead, and his dominance didn’t stop in Portland and Eugene. He outpolled Clinton in every Oregon county except Gilliam.

Sanders’ success in Oregon sends a troubling message to Clinton’s campaign. He likely would have done even better here if independents and non-affiliated voters could have voted for him in the primary.

Trump carried all Oregon counties, which isn’t surprising since no one else was campaigning. A year ago, when Trump announced his candidacy, it was unimaginable he would still be in the race at this point, let alone on what amounts to a victory lap to the GOP presidential nomination. 

Pierce handily defeated Allen Alley, a former Oregon GOP chairman, by running a campaign as a fresh outsider face. In his campaign victory speech, Pierce, who is a Salem medical doctor, told supporters, “I am not corrupt. I am not corruptible."

Raw vote totals confirm that Oregon is a blue state. Sanders and Clinton received around 550,000 votes compared 350,000 GOP votes for a presidential candidate. Brown, who faced only marginal opposition in the Democratic gubernatorial primary, racked up more than 400,000 votes while all GOP candidates received a combined total of 286,000 votes. 

Avakian overcame strong opposition from fellow Democrats Val Hoyle and Richard Devlin in what emerged as the most bruising campaign in Oregon’s primary. Avakian, who is state labor commissioner, now will face Republican Dennis Richardson, who lost to John Kitzhaber in the 2014 gubernatorial race. The wounds inflicted on Avakian in the primary may make this a more interesting race in the fall, giving Republicans at least a glimmer of hope to capture a statewide office.

Wheeler, who is state treasurer, will be in an interesting position as Portland’s mayor in the wings until he is officially sworn in next January. Wheeler was recruited by a coalition of business and labor to challenge Mayor Charlie Hales, who decided not to seek re-election. Hales has continued to fester a contentious relationship with groups such as the Portland Business Alliance, which Wheeler may be asked to mediate over the next few months.

Democrat Tobias Read will face Republican John Gudman to succeed Wheeler, who was term-limited as state treasurer.

Portland Commissioner Amanda Fritz easily won re-election, but Steve Novick will be forced into a fall runoff, probably against architect Stuart Emmons, after capturing only around 43 percent of the vote.

Clackamas County Chairman John Ludlow finds himself in the same situation, only he trailed fellow Commissioner Jim Bernard who collected 37 percent of the vote to Ludlow’s 28 percent. They will scramble to win the other 45 percent of votes cast that were split between Commissioner Paul Savas and Oregon City Mayor Dan Holladay. Clackamas County Commissioner Tootie Smith also will compete in a fall runoff against challenger Ken Humbertson. Commissioner Martha Schrader won re-election.

Victories in November by Bernard and Humbertson would change the tilt on the Clackamas County Commission to more middle-of-the-road politics.

Incumbent Washington County Commissioners Roy Rogers and Dick Schouten were re-elected, as were Metro Councilors Craig Dirksen, Sam Chase and Bob Stacey. Schouten and Stacey ran unopposed.

Perhaps the most interesting legislative primary race saw newcomer Rich Vial capture the GOP nomination in Oregon House District 26 over former Rep. Matt Wingard who sought a comeback. Wingard faced stinging opposition centered on his previous conduct that forced him to resign.

House Speaker Tina Kotek turned back a primary challenge from Sharon Nasset, whose campaign was tied to questionable tactics involving misleading mailings.

Oregon Senator Ron Wyden won the Democratic nomination after threats failed to materialize for a challenge to his re-election from the political left. Congressman Kurt Schrader overcame a challenge from progressive candidate Dave McTeague. Congressmen Peter DeFazio and Greg Walden and Congresswoman Suzanne Bonamici walked over token opposition in their respective primary contests.

Results on local school elections were mixed. Bond measures in Gaston and McMinnville won, but ones in the Corbett, Molalla and Centennial districts lost. Clackamas County voters gave the green light to commissioners to explore funding for road improvements. Rogue Valley Transit won voter approval for a property tax increase and Rogue Community College passed a $20 million bond measure.

Secretary of State Jeanne Atkins predicted 1 million votes would be cast in this year’s primary, marking only the second time that threshold has been reached. The first was in 2008, sparked by the Democratic presidential runoff between Clinton and Barack Obama.

The primary was the first statewide election since Oregon’s Motor Voter law went into effect, which automatically registered people to vote when they took out a driver’s license. Atkins previously reported that many newly registered voters affiliated with a political party, with Democratic registration far outstripping Republican registration. 

With PERS Benefits Off the Table, Time to Reduce Costs

Oregon's gamble on trimming public retiree benefits failed and it now faces a $13.75 billion Public Employee Retirement System deficit, with few ideas on the table of what to do next. Photo by The Oregonian. 

Oregon's gamble on trimming public retiree benefits failed and it now faces a $13.75 billion Public Employee Retirement System deficit, with few ideas on the table of what to do next. Photo by The Oregonian. 

A lot of hand-wringing, but not much action has followed the Oregon Supreme Court's decision invalidating many of the Public Employee Retirement System changes aimed at reducing the state's unfunded liability.

Public employee union officials are clucking, "We told you so." Legislators are conceding there is little more that could be done to trim retiree benefits. And state and local public agencies are bracing for a round of stiff PERS contribution rate hikes in 2017.

If you can't touch retiree benefits, all that's left is reducing costs associated with PERS. And lo and behold, the legislature is sitting on a bill that backers say could save $2.7 billion over the next 20 years in expenses to manage public retirement investments.Under Senate Bill 134, an Oregon Investment Department would be formed as an independent agency, much like SAIF Corporation. The department would be overseen by the Oregon Investment Council and responsibility to administer public retirement funds would fall to a professional investment manager, not the state treasurer. The treasurer would be the vice chair of the Council.

Even though this set-up would require hiring more staff members to manage a portfolio and assess risk, it would enable Oregon to free itself from the higher-priced consultants it pays for now. One benchmarking analyst said Oregon is a “high-cost fund compared to its peers, in large part because of Treasury's heavy reliance on outsourcing.” This is where the projected savings comes into play.

Cost-cutting has the drawback of not appearing to reduce the unfunded liability, but the advantage of reducing the outflow of cash to manage public retirement funds, while "in-sourcing" investment management duties.

Republican lawmakers may fret about hiring more state workers, but they may see increased local employment as a better alternative than sending big sums to Wall Street investment management firms.

The legislation, introduced by Treasurer Ted Wheeler, nearly passed in the short 2014 legislative session. The Oregon Investment Council expected it to fly through the 2015 session. But it hasn't.

Senate President Peter Courtney has sat on the legislation this session out of fear of creating another "Cover Oregon" calamity. But that was before the Oregon Supreme Court ruling on so-called PERS reforms. Now the legislature is staring at a financial tsunami far worse than Cover Oregon.

Wheeler's uncertain political status may be another contributing factor. Deemed constitutionally unable to run for another term as state treasurer, Wheeler appears to be considering his options. Many of those options could involve other elected officials – in the governor's office and in key legislative leadership positions. These potential opponents may not feel a need to give Wheeler a perceived "political victory."

While Courtney's reluctance and other elected officials' wariness are part of the normal political process, the PERS problem may force everyone to rise above "normal."

At a minimum, giving the Oregon Investment Department and the savings it might generate a second look could form the basis of a broad coalition business-labor coalition willing to find ways to nibble away at the problem without threatening retiree benefits. It seems like a much better use of time than hand-wringing.

Links: 

Wheeler Urges Steps to Boost Savings

A failure of many Oregonians to save enough for retirement could pose a financial threat to the state, Treasurer Ted Wheeler warned today in testimony to Oregon lawmakers. 

Calling the lack of savings a "generational crisis that threatens to plunge seniors into poverty, disrupt entire families and impact our overall economy,​" Wheeler said more than half of Oregon adults have less than $25,000 set aside for their retirement and one quarter have $1,000 or less in reserve.

One reason people don't save more, Wheeler said, is the shrinking number of employer-sponsored retirement plans and easy payroll access to a retirement saving vehicle. 

Wheeler's comments came in the form of recommendations from the Retirement Security Task Force, which he has chaired for the last eight months. One of the biggest recommendations was for the state to step in and provide a retirement savings plan that anyone could use.

In a press statement, Wheeler included a quote from Jose Gonzalez, who runs a Salem real estate agency: “As a small business owner I want to do the right thing and offer my employees strong retirement savings options. The Task Force recommendations released today give me hope that Oregon can come up with a way to make it easy for my employees to save without burdening small business owners with additional administrative hassle.” 

The Might-Be, Could-Be Special Session

The September 30 legislative special session is the picture of conjecture. It might happen. Then again, it might not. If it does, we know when. If it doesn't, we may never completely know why.

Governor Kitzhaber and Senate President Peter Courtney appear to be in roughly the same position as President Obama and Senate Majority Leader Harry Reid. Kitzhaber and Courtney see a grand budget deal as tantalizingly close, but face reticence or outright opposition from the political right and political left. 

Obama and Reid got a sprinkle of fairy dust on the Syrian issue with a possible diplomatic breakthrough by Russia convincing its ally to surrender chemical weapons to international authorities. Kitzhaber and Courtney might not be so lucky.

Republicans aren't eager to support a tax hike, which some business supporters see as the best antidote to a divisive ballot measure on taxation next year. House Democrats aren't thrilled about another round of benefit cuts to public employee retirees.

And the special session has another major component — the plan for Oregon to forge ahead alone on a new I-5 Columbia River bridge. Kitzhaber strongly supports this idea, but some of his allies aren't quite so firm. Courtney doesn't want to act unilaterally and offend Washington. Portland-area Democrats want assurance Tri-Met won't be on the hook to pay for operations and maintenance of light rail once it is extended into Clark County.

A Portland Democrat said he attended a fundraiser this week where half his colleagues were confident there would be a special session and the other half were equally confident there wouldn't be.

Political Pot Continues to Boil

The September 15 deadline is creeping up for Governor Kitzhaber to decide whether to move forward with a legislative special session to consider further cuts to public employee pensions, business tax cuts and an Oregon-led approach to building a replacement I-5 Columbia River bridge.

The path to all three is littered with political obstacles. One thing is clear, however. If there is a special session, it will be by September 30, the date that Oregon's offer expires to share the state costs on the bridge with Washington.

The Kitzhaber camp isn't saying whether he has lined up the votes for the grand bargain or bridge funding. The pieces may not fall into place – or fall apart – until Treasurer Ted Wheeler releases his financial analysis of the risks involved in Oregon leading the way on replacing the Columbia River bridge. When the Oregon-in-the-lead strategy was unveiled last month, Wheeler questioned whether there was enough time for an analysis before a special session would be called. Now he has until September 15.

Bridge financing is not a new subject for Wheeler, the former Multnomah County chair who pieced together the bucks to replace the aging Sellwood Bridge, which is now under construction. But the timing of the Columbia River bridge financial analysis couldn't have occurred at a stickier time for Wheeler, who might be the odds-on favorite to succeed Kitzhaber as governor if he decides not to seek re-election.

As it turns out, Kitzhaber is fundraising, presumably for his yet-to-be-announced 2014 gubernatorial re-election campaign. The three-term governor also showed his political flag at a Labor Day union function, declaring firm opposition to an initiative that would ban mandatory payments by public employees to public unions. The Oregonian speculated his comments – which caused Oregon AFL-CIO President Tom Chamberlain to quip: 'Damn, Governor, you sounded like the president of the AFL-CIO" – were aimed at politically defusing political opposition caused by his continued support for deeper cuts in public employee pensions.

The Ungubernatorial Candidates

Two Republicans — Rep. Dennis Richardson and businessman Jon Justesen — have declared for governor and the Democratic incumbent is weighing whether to seek an unprecedented fourth term.

But what's more remarkable is the long list of people who aren’t showing any signs of running in 2014, even though the gubernatorial primary is now just nine months away.

One reason for reticence is the status of Governor Kitzhaber, who remains popular, but hasn’t decided whether to go for another term. Because of his name familiarity, he can afford to wait, keeping challengers cooling their heels.

But indecision often can be all the bait some eager beavers need to step forward as potential candidates and see whether any winds collect in their political sails.

Here is a quick look at who is definitely not running and who might be lurking in the weeds if Kitzhaber decides to focus on his own personal Happiness Index:

Definitely Out

  • Unsuccessful 2010 GOP gubernatorial candidate Chris Dudley, who has moved out of Oregon.
  • Oregon Congressman Greg Walden, who has risen steadily in the U.S. House leadership ranks and sees no good reason to sacrifice that for a gubernatorial run, at least at this stage of his political career.

Legislature Adjourns, Post-Mortems Commence

Before you could say Sine Die, emails started flying describing the 2013 Oregon legislative session successes and disappointments.

Some rued the lack of a "Grand Bargain" on increased tax revenue and deeper cuts in the Public Employees Retirement System. Others pointed out individual successes, such as Rep. Brent Barton, D-Clackamas, who touted legislative approval of a $5 million investment for the Willamette Falls redevelopment "located at the heart of my district." A few deplored specific bills, such as Senator Doug Whitsett, R-Klamath Falls, who bewailed a bill dealing with tenants using Section 8 housing vouchers.

Oregon Pubic Broadcasting's Chris Lehman posted a story about a session of "missed opportunities." Senate Republican Leader Ted Ferrioli was blunter, saying the 2013 session held promise for historic decision-making that didn't pan out. Treasurer Ted Wheeler applauded the legislature for sending his Opportunity Initiative to generate more money for college student aid to the November 2014 election ballot. 

Pretty much everybody, except Senator Chris Edwards, D-Eugene, took bows for increasing K-12 school funding by a $1 billion. Edwards thought it should have been more to avoid teacher layoffs and shrunken school schedules that will still face some districts around the state.

And there was something for almost everybody in the $1 billion lottery bonding measure, affectionately known around the Capitol as the Christmas tree bill. It contained $79.4 million for a new state hospital in Junction City, $15 million for Multnomah County Courthouse improvements, $10 million for the proposed convention center hotel and $618 million in assorted investments at public universities and community colleges. 

Lawmakers approved $34.5 million to undertake a major remodeling and seismic upgrade for the Oregon Capitol, which will involve a temporary home for the legislature while the building is jacked up and put on huge springs.

Wheeler Plan to Boost Student Aid

Oregon Treasurer Ted Wheeler proposes to issue state bonds to create a fund to bolster college student financial aid as tuitions, fees and student debt all rise and average Oregon income lags.To combat rising college tuition and student debt, Oregon Treasurer Ted Wheeler is proposing to issue $500 million in general obligation bonds to increase available student aid. Voters would have to ratify a constitutional amendment to create the Student Opportunity Fund.

Wheeler unveiled details of what he calls the Opportunity Initiative the day after Governor Kitzhaber delivered his annual State of the State address. The governor proposed public employee retirement system and prison sentencing reforms to squeeze out savings to boost K-12 school funding.

Kitzhaber also reiterated support for higher education investment to help Oregon achieve an ambitious goal of 80 percent of its adult population having a postsecondary degree or certificate to ensure a competitive Oregon workforce in the Information Age. That's where Wheeler's idea joins the conversation. 

Wheeler says Oregon's commitment to student assistance has lagged the national average by 20 percent, while Oregon students attending state universities or community colleges have faced tuition and fees exceeding the national average by 18 percent. 

Making State Jobs Programs Do the Job

Legislators of both political parties and from all parts of Oregon agreed the state can play a more significant role in job creation by making its far-flung economic development efforts more agile and coordinated.

With nearly unanimous support in their short 2012 session, lawmakers approved House 4040, which the Eugene Register-Guard said "could prove to be the most far-reaching jobs bill that emerged from the legislative session."

The genesis of the Oregon Investment Act stands in stark contrast to the bickering and posturing in Congress as it debates how to stimulate the still-sluggish U.S. economy.  The act also provided a way for legislators here to surmount their usual differences over the appropriate government role in economic development.

To get behind the scenes, I asked Rep. Tobias Read to recount how the measure came about. Here's what he said:

"After he was elected, Governor Kitzhaber and his team asked Treasurer Ted Wheeler, Business Development Commission Chair Wally Van Valkenburg and me to serve as something of an economic development transition team. We had a lot of help from Scott Nelson (Governor's office), Tim McCabe (Business Oregon director), Paul Grove (Business Oregon legislative coordinator) and others as we worked quickly to put together some recommendations. We also recognized that there was far more work than could be done in the short time between his election and his inauguration, so, as we delivered our recommendations, we asked for the opportunity to continue working.  

"We got permission, and spent some time learning about strategies from other states and countries, and then went on the road to talk with people about what businesses in Oregon needed to expand and hire.

"We heard different versions of the same story around the state. The consistent theme was that businesses couldn't get access to the capital they needed to expand.  Furthermore, people felt that Oregon's programs are scattered across agencies, difficult to find, and too rigid.

"We recognized that we couldn't solve all these problems in the short session, or in the time that led up to it, so the Investment Act (House Bill 4040) is really enabling legislation that creates the Growth Board to build a plan to address all these issues — and to make policy recommendations to set the stage for substantive changes next session.  We made clear that we were interested in establishing priorities, promoting flexibility, achieving coordination, and gaining the leverage that comes from attracting new private-sector dollars into the Oregon economy.  

Jobs Bills in the Mix

In a short legislative session dominated by budget concerns and Governor Kitzhaber's ambitious reform efforts in health care, education and early learning, jobs bills have taken a back seat. But that doesn't mean they won't make it to the finish line.

There are major bills to coordinate the state's economic development activity, create more enterprise zones and reduce temporarily Oregon's capital gains tax rate. And there is legislation to clarify how and when to tax data centers such as Facebook's that were prize catches by previous economic development recruitment.

Here is a quick overview of some of the significant jobs-related legislation in Salem:

House Bill 4040: Drafted by two influential legislators — Reps. Tobias Read, D-Beaverton, and Cliff Bentz, R-Ontario, along with State Treasurer Ted Wheeler, the Oregon Investment Act seeks to align state economic development programs and incentives to make them more inviting to private sector companies. The measure has passed out of the House Transportation Committee, so remains alive.

Read, Bentz and Wheeler co-authored an op-ed in The Oregonian explaining their intentions:

"Oregon spends significant Oregon Lottery profits and other funds today to enhance business development. Yet those tools are scattered across multiple agencies and have little strategic connection, and sometimes have little accountability to measure results.

A Major Issue Just Around the Corner: How Much State Bonding is Too Much?

Several months ago, while he was running for re-election, State Treasurer Ted Wheeler advised the legislature to be very careful about the level of bonding it approved in the 2011 legislative session. To some, his admonition was even stronger – don't do any more bonding.

Whether he meant "no more" or a "caution," the State Bond Advisory Committee went on record last Friday with similar advice. 

A news release issued by the Treasurer's Office said this:

"Oregon policymakers should be judicious and strategic about the use of scarce state debt capacity in the upcoming budget cycle, the State Debt Policy Advisory Commission recommended today (Friday, February 18). The Commission advises the Legislature and Governor about the prudent level of state debt that is repaid from two sources: The General Fund and Oregon Lottery revenues. Bonds that are repaid with dedicated sources of revenue, such as gas taxes, tuition, and loan repayments, are not part of the commission’s debt capacity calculus.