Oregon Legislative Update
Legislative Update February 6, 2009
In This Update
What's Happening
Issues
ISSUES
These are a few issues (bills) to call to your attention:
Affordable Housing
Climate Change/Green Bldg/Energy Efficiency
Big Look and Land Use
CCB
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List of OHBA Tracked Bills
House
Senate
to see all bills go to the state's website
Contact Us:
Jon Chandler
jchandler@oregonhba.com
Scott Barrie
sbarrie@oregonhba.com
Welcome to the Oregon Home Builders Association's legislative update. We'll be publishing these on a weekly basis throughout the legislative session - if you want off the list, please let us know. If you know others who you think would like to receive these reports, please ask them to contact us and we'll add them to the list. And, of course, if you have questions or comments on anything discussed here, please drop us a note and we'll get back to you as soon as we're able.
What's Happening
Did you know that you can follow the legislature online? The state legislative website not only has all the bills listed, it has their history (hearings, votes, etc.) and it also has audio and video links to committee hearings and to the House and Senate floor debates. Audio from committee hearings are also archived on the website.
The deadline for getting bills into Legislative Council for drafting was this past Monday, which means that over the next several weeks there will be hundreds of bills coming out...we're already tracking close to 200 bills - most of which we're simply keeping an eye on, but some are quite troublesome - that number will expand greatly over the next month.
We submitted five bill requests, dealing with:
· Tying local initiatives to the
deadlines for state measures
· SDC reforms
· State agencies and moratorium law
· Automatic development extensions
· Land supply issues
In addition to these bills, we are actively working on other aspects of our legislative committee discussions (BCD, energy efficiency, on-bill financing of remodels, for example) in other bills.
The big issue this past week was economic stimulus, and the legislature sent a couple of inconsistent signals. They passed, very quickly, SB 338, which will provide $175 million in bonding for infrastructure projects. Additional stimulation is expected in the weeks ahead.
They also passed, however, and also very quickly, HB 2157, which would disconnect Oregon's tax law from a provision being discussed in the federal stimulus package. The federal law would, if adopted, provide for "bonus" depreciation for capital assets placed into service in 2009 with the logic that this might spur additional investment; a liberal think tank here estimated that if Oregon were to adopt a similar provision, it might cost the state $70 million or so over the next two years, so the legislature rammed a bill through the House to make sure that didn't happen.
Now, the likelihood is that very few builders will be making capital purchases next year anyway, and frankly none of us in the business lobby could figure out which industries would be doing so, but the point is that this was not a pro-business vote. We didn't throw a fit about it, choosing to spend our political capital elsewhere, but we did make sure that the leadership knew that we noticed.
The broad issue of taxes and the budget continues to be the rhino in the kitchen that many legislators are pretending isn't there. As Oregon's economy continues to sag, the number needed to balance the current biennium's books increases - they are now publicly talking about the gap being $800 million, but we're hearing it will likely be over a $1 billion before long - and that is a very difficult hole to fill. As an explanatory note: Oregon operates under a two year (biennial) budget, and the current budget cycle lasts until July 1. So the first task for this legislature is to balance the books for 2007-2009, and that's the $800 million + issue. After they get that done, then they get to move on to the even more daunting task of crafting a budget for 2009 - 2011, where the shortfall is likely to be closer to 3 billion. This problem will color the entire legislative process, both practically and politically, but the outlines of what they expect to do and how they propose to do it are still being filled in. More on this happy topic as it emerges.
The other big issue of the session is going to be climate change, and we have joined up with pretty much every other business organization in the state - timber and heavy industry and truckers and utilities and banks and Realtors and metals and farmers and AOI and NFIB and so on and on - to present a business-friendly alternative. We're calling ourselves Oregonians for Balanced Climate Policy, and we've been meeting with key legislators to make sure that they know there will be a moderate climate package that they can support, not just the Governor's more aggressive approach.
Issues
Affordable Housing
We testified on HB 2436, the recording fee for affordable housing bill, both in the House Revenue committee but also in the Ways & Means committee. In doing so, we were able to put on the record both our support for affordable housing and the deal we struck with the affordable housing activists: no real estate transfer tax and no mandatory inclusionary zoning.
Back to the Top
Climate Change/Green building/Energy Efficiency
HB 2186 had a hearing in the House Environment & Water committee; the bill, which is part of the Governor's climate package, would give DEQ authority to set fuel standards and to also regulate pretty much anything that might produce greenhouse gasses, which is a tad broad. We presented testimony as basically the de-facto spokesman for our business climate coalition, and pointed out that there were other ways to accomplish greenhouse gas reductions without broad grants of power to DEQ and without requiring the use of fuels that don't exist.
Speaking of climate, SB 80 also had a hearing; this is the centerpiece of the Gov's plan, and would direct DEQ to develop a cap and trade system for Oregon. The hearing started Thursday in the Senate Environment & Natural Resources committee at 3:00 and was still going strong at 6:00 when we left the building, and that was just the first hearing of this bill. We testified as to all the carbon reducing things we're already doing and also as to our opposition to cap and trade - or anything else of the sort - being done at the state level as opposed to the federal.
There were no hearings this week on SB 79, the energy efficiency/building codes bill, but two work groups were spawned by the bill. One is dealing with energy performance scores, and the other dealing with the building code provisions. The two sub-committees start meeting next week, but we already have major problems with the building code related language in the bill. First and foremost the bill would completely remove the input of the Residential Structures Board as well as the other policy boards and allow the Director to: "Amend, approve, modify, reconcile, reject, repeal or suspend any code, specification or standard of the department or an advisory board under the state building code or specialty code;" and "approve, condition, limit, reject or suspend the use of any material, method or product for building construction" With the goal of constructing nothing but "net zero emission buildings" by 2030.
Big Look and other Land Use
HB 2229, the Big Look bill, had a hearing this past week but we weren't able to present any testimony. We were tied up in the hearing on HB 2186 - the legislative schedulers, for reasons that are totally unclear to me - have, on Tuesday and Thursday afternoons, the House Land Use committee, the House Environment & Water committee and the Senate Environment & Natural Resources committee all meeting at the same time. Annoying. In any event, there was a full room plus overflow at the HB 2229 hearing, most of whom were there to complain that the Big Look task force report would end Oregon as we know it, so I'm guessing we didn't miss much. 2229 will be heard again next week, hopefully with a bit less theater and a bit more substance.
CCB
HB 2366 sets up an assistance fund, not too different from the recovery fund from the 2007 session. The major difference is that this fund would only be available for consumers that were caught in a "pay twice" situation. In other words the consumer paid the contractor but the contractor or a sub-contractor did not then pay a sub or supplier for their work or material and the consumer ends up with a lien on their house. The house could then be foreclosed to collect the debt (it is rare that this occurs). The concern we have is that the solution in the bill is to tax (fee) the good contractors to pay off the consumer liens. We have and will continue to oppose this method of payment as long as the State of Oregon takes the civil penalty money from fined contractors and puts it in the general fund. This civil penalty money would supply the Construction Contractors Board with enough money to satisfy all these liens and solve the problem. We may draft an amendment to address the issue with the civil penalty money.
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Building a Better Oregon
February 6, 2009
This Week
· House Republicans Announce 'Main Street' Economic Stimulus Plan to Help All Oregonians
· Video: Rep. Esquivel Compares 'Main Street' Plan to Democrats' Borrow-and-Spend Package
· House Republicans Oppose Preemptive Tax Increase on Businesses
· This Week's Notable Votes
· Next Week at the Capitol
House Republicans Announce 'Main Street' Economic Stimulus Plan to Help All Oregonians
House Republicans recently announced the Main Street Incentive Program to encourage businesses and home owners to immediately invest in improvements to their property through a tax credit.
The proposal would stimulate the economy and create jobs without increasing state debt and locking up larger portions of the state budget.
"Economic stimulus should benefit all Oregonians, not just state government," said House Republican Leader Bruce Hanna (R-Roseburg). "Projects supported by the Main Street program would create immediate local jobs in all parts of our state. Local property owners would determine where jobs will be created, not the powerful politicians at the State Capitol."
Under the proposal, Oregonians would be able to claim 50 percent of the costs of their own capital construction projects over a five-year period. Property owners pursuing "green" projects, or those that promote renewable energy alternatives, would qualify for a 100 percent tax credit over a five-year period. In order to quickly boost job creation, qualified projects must begin before September 1, 2009.
"All of the money in the Main Street plan would go directly toward labor and materials for projects, providing immediate economic stimulus for communities across Oregon," said Rep. Scott Bruun (R-West Linn). "The Main Street plan will enable businesses to expand and allow Oregonians to increase the value of their homes. Community lenders would benefit from increased business, and local government would benefit from new revenue generated by enhanced property values for years to come."
Rep. Tim Freeman (R-Roseburg) said one hundred percent of the Main Street program would be spent on economic stimulus and job creation, creating lasting and permanent value in local communities.
"The dollars in this project support long-term capital projects, not light-bulb replacement or moss removal," Rep. Freeman said. "Most importantly, it would create jobs and enable Oregonians to participate in the economic success of their communities."
During this week's Floor debate, Rep. Sal Esquivel (R- Medford) compares the Democrats' borrow-and- spend stimulus package to the Main Street economic stimulus plan, the proposal that empowers Oregonians to create jobs in their communities.
House Republicans Oppose Preemptive Tax Increase on Businesses
House Republicans this week opposed legislation that would undermine President Obama's economic stimulus plan and preemptively raise taxes on Oregon businesses. HB 2157 disconnects the state from the federal tax code, and the measure will likely eliminate state incentives for businesses to invest and re-invest during an economic recession.
"We will have disagreements with President Obama, but we share his belief that Oregon businesses should have incentives to invest in equipment, machinery and other goods," said House Republican Leader Bruce Hanna (R-Roseburg). "Tax incentives such as extending bonus depreciation rules would enable businesses to free up resources to create and retain jobs. HB 2157 only makes it more difficult for Oregon to reverse this economic recession."
Rep. Scott Bruun (R-West Linn), a member of the House Revenue Committee, said the state has commonly adjusted its connection to the federal tax code but has retained provisions that are beneficial to the state's economy.
"During the last budget crisis in 2001-03, the Legislature retained provisions of the federal tax code that are important for the businesses in our state," Rep. Bruun said. "Rather than deliberating on the many merits of Oregon's connection to the tax code, the Legislature is now rushing to disconnect and make our tax system more confusing. HB 2157 will only increase the costs of doing business in Oregon."
Rep. Matt Wingard (R-Wilsonville) noted that the Legislature is rushing to pass HB 2157 before a federal stimulus package is even signed by the president.
"We need to give President Obama and Oregon's Congressional delegation a chance to develop a federal stimulus plan that works for our state," Rep. Wingard said. "Rather than waiting for the federal package to become law, our state Democratic leaders are rushing HB 2157 through the process. This is not the right way to develop sound economic and tax policy for our state."
This Week's Notable Votes
SB 5562: Part of the Democrats' borrow and spend package.
Passed. Ayes, 39; Nays, 21--Bentz, Berger, Bruun, Cameron, Esquivel, Freeman, Gilliam, Gilman, Hanna, Huffman, Kennemer, Krieger, Maurer, Olson, Richardson, Sprenger, Thatcher, Thompson, Weidner, Whisnant, Wingard.
HB 2157: The bill to deny Oregon companies tax incentives included in the federal stimulus plan.
Passed. Ayes, 36; Nays, 23--Bentz, Bruun, Cameron, Esquivel, Freeman, Garrard, Gilliam, Gilman, Hanna, Huffman, Jenson, Kennemer, Krieger, Maurer, Olson, Richardson, Smith G., Sprenger, Thatcher, Thompson, Weidner, Whisnant, Wingard; Excused, 1-- Berger.
Next Week at the Capitol
Notable Committee Hearings Next Week:
Monday-February 9
House Judiciary Committee
1:00 P.M. Room 357
HB 2237 FIRST PUBLIC HEARING - Increases penalties for driving while under influence of intoxicants if person has blood alcohol content of 0.15 percent or more.
House Revenue Committee
8:00 A.M. HR A
HB 2067 FIRST PUBLIC HEARING - Creates or adjusts sunset provision for certain personal income or corporate excise tax credits that are not required under federal law or Oregon Constitution.
Tuesday-February 10
House Revenue Committee
8:00 A.M. HR A
HB 2073 FIRST PUBLIC HEARING - Modifies conditions under which Legislative Assembly may appropriate moneys from Oregon Rainy Day Fund.
House Environment and Water Committee
3:00 P.M. HR D
HB 2186 Authorizes Environmental Quality Commission to adopt rules to help state to achieve greenhouse gas emissions reduction goals.
House Land Use Committee
3:00 P.M. HR D
HB 2229 Relating to recommendations of Oregon Task Force on Land Use Planning; appropriating money; declaring an emergency.
Wednesday-February 11
House Health Care Committee
3:00 P.M. HR D
HB 2361 Requires health benefit plan to cover drug containing pseudoephedrine for allergy symptoms if plan covers prescription drugs for allergy symptoms.
Click here to review these bills
email: info@oregonhouserepublicans.org
phone: (503) 986-1400