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Local lawmakers see session as success

Area legislators say this week's special session of the Oregon Legislature finally addressed the public retirement fund crisis, raised a sizable chunk of money for all levels of education and saw the corporate world step up and welcome new taxes, which will help boost the state's education and economy.

Sen. Alan Bates, D-Medford, noted the revenue package — created in large part by a corporate excise tax increase — will generate $100 million for K-12 schools and $40 million for colleges.

But the real achievement was in reaching at long last an agreement to reduce payments made into the Public Employee Retirement System. Those cuts are expected to save the state and local governments $400 million a year to start and $4.8 billion over the long term, but still represents only about a quarter of the unfunded portion of the PERS obligation.

"The main thing we got done was PERS," Bates said Thursday, one day after the conclusion of the three-day session. "It's a huge first step, that is, if the stock market performs well."

PERS invests in the stock market, where the state lost 27 percent of its funds in the '08 crash.

It was difficult to get House Democrats to reduce the PERS cost-of-living increase, said Bates, and it's still possible the state Supreme Court could rule the cutbacks are not legal. But, for now, all hailed the move as creating a path to putting more teachers in classrooms.

"For years now, we've been told we can't invest in education because PERS (and other items) are so expensive," said Rep. Peter Buckley, D-Ashland.

"This is a huge step toward reinvestment in education after two decades of disinvestment — and it's a bipartisan goal."

Oregon's major business groups "stepped up and supported the tax and it cost them money," said Bates. "Business said, 'Hold down PERS, so the money can go to education.'"

It's significant, he added, that business groups lobbied in favor of increased taxes on themselves, as "it's become painfully clear that unless we invest in education, we won't have the workforce or a good economy here."

"I believe we are turning a corner," Bates said.

Legislators passed a statewide ban on municipalities prohibiting genetically modified organisms, but Bates and Buckley voted against it. Jackson County voters will still decide a ballot measure in May on the issue for this county, a move that Buckley described as "leadership's concession to Bates and me" in exchange for rounding up Democratic support for PERS reform.

The GMO measure was the only one of the five bills that Buckley voted against.

"It's the wrong policy to do it at the state level," he said. "Three counties in California have banned GMOs and they've thrived with organic farming."

But Rep. Sal Esquivel, R-Medford, who carried and voted for the GMO bill, said it makes more sense to have a statewide law rather than a mish-mash of rules from 314 local governments.

"It needs to be in the hands of the state," Esquivel said.

Esquivel, a fiscal conservative, voted for the corporate tax increase, but said that wasn't a controversial decision. Ticking off the names of all the major corporation lobbies, Esquivel said every one of them supported the tax, so the choice was easy for him.

The corporate taxes were needed, Bates said, as part of the deal to get Democratic House votes for PERS trimming.

Bates, however, said he voted against the tax package in the Senate because it was too complex for anyone to understand — and as a protest against the cigarette lobby's maneuverings to avoid a significant tax hike.

Bates, who is a physician, said the entire tax increase "could have been handled by a $1 tax on cigarettes." The approved tax was a 10-cent increase.

Oregon's cigarette tax is the lowest in the West, but the powerful cigarette lobby, Bates said, threatened to mount a statewide ballot measure to overturn new taxes if they were more than a "paltry" 10 cents.

Nevertheless, lawmakers celebrated the final result, especially after it appeared on the first day of the special session that Gov. John Kitzhaber's "Grand Bargain" with Republican leaders would fall short of gaining enough votes.

"It's amazing we pulled it all together," said Bates. "There was such tension in that building. But we're not Washington, D.C., and we got it done."

John Darling is a freelance writer living in Ashland. Email him at jdarling@jeffnet.org.