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Taxes will dominate the political scene this year
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Taxes will dominate the political scene this year

BY Richard R. Aguirre

Sex, religion and politics always have ignited fierce debates. But taxes are a far more explosive subject in Oregon nowadays. That is sure to continue for at least another year. Politicians and political activists are ramping up their rhetoric about tax increases, tax cuts, tax reform and the proper level of state government programs and services. An income-tax increase plan approved by the 2003 Oregon Legislature is the subject of intense debate.

11/02/2003
Director has a history of political involvement Director has a history of political involvement
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Director has a history of political involvement Director has a history of political involvement

BY Steve Law

Russ Walker winces at criticism that his group, Citizens for a Sound Economy, is made up of carpetbaggers sent to Oregon to overturn the 2003 Legislature's $1.2 billion tax increase. After all, the Keizer resident graduated from high school in Central Point, a small community near Medford. He has lived here the past nine years and can point to ancestors who settled in Southern Oregon in 1860.

11/01/2003
Activist group brings money, draws concern
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Activist group brings money, draws concern

BY STEVE LAW

Citizens for a Sound Economy, a little-known national group, emerged in Oregon during the 1999 legislative session, when it lobbied for a telephone deregulation bill sought by phone monopoly US West. Months later, leaked internal documents revealed the self-described “grass roots” group received $1.25 million from US West in 1998. Investigative reports also showed Citizens for a Sound Economy: •Got $1 million from Philip Morris while opposing cigarette tax hikes. •Took money from Microsoft and lobbied Congress to curtail federal antitrust enforcement.

11/01/2003
Oregonians sound off on state revenue plan
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Oregonians sound off on state revenue plan

BY DANA HAYNES

Statesman Journal (c) Copyright 2003, Statesman Journal. All Rights Reserved. Thursday, August 21, 2003 Legislature; C It didn't take long for Oregonians to speak out for, and against, the revenue package passed Wednesday by the House and Tuesday by the Senate. And it didn't take long for the first threat of going to voters in 2004 to repeal the revenue package.

08/21/2003
Senate Seeks to Alter Lawmakers' Benefits
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Senate Seeks to Alter Lawmakers' Benefits

BY Steve Law

A bill OK'd Friday guts a preferred PERS status reserved for police and firefighters. How senators voted The Senate passed HB 2407-C by a 16-11 margin. The bill reduces lawmakers PERS benefits by paying them at the regular level, not the higher levels given to police and firefighters. Lawmakers who began serving before 1995 are exempt. Here is how local senators voted: Roger Beyer, R-Molalla: No Peter Courtney, D-Salem: Yes Jackie Winters, R-Salem: No Gary George, R-Newberg: Excused Charles Starr, R-Hillsboro: No What's next? The House will consider Senate amendments to HB 2407-C. The House likely will reject those amendments. Then a conference committee of House and Senate delegates will try to work out conflicting versions of the bill. BY STEVE LAW Statesman Journal The state House and Senate are at odds about whether lawmakers should remain in the state pension system. House members voted in March to yank lawmakers from the embattled Public Employees Retirement System and create a special 401(k) plan for them. Rejecting that idea, the Senate voted Friday to reduce lawmakers' PERS benefits, by eliminating their preferred benefits package normally reserved for police and firefighters. The Senate passed House Bill 2407-C by a 16-11 margin. "It's unjust enrichment" to keep getting benefits as if lawmakers were in public safety jobs, said Sen. Tony Corcoran, D-Cottage Grove, whose committee reworked the earlier House bill. Preferred PERS benefits for lawmakers often provokes howls of protest. It allows lawmakers to get the same pension after 25 years that most public employees take 30 years to earn. Police and firefighters get that treatment because of their hazardous jobs and earlier retirement age. In the past, some lawmakers determined that their long hours and low pay - $15,396 a year- merited the premium level. House members argued it's a conflict of interest for lawmakers to oversee a system that pays them benefits. Corcoran rejected that notion Friday. "My view is that there's nothing inherently wrong with us being part of PERS," he said. "We should live under the same rules as everybody else." Public servants should have a guaranteed benefit at the end of their careers, not a 401(k) account that offers no set pension, Corcoran added. Sen. Lenn Hannon, R-Ashland, who presided over the floor debate, declared he had a conflict of interest in the matter. Hannon also suggested lawmakers all had a conflict of interest "as a class." One provision in the bill illustrated why the issue stirs so much controversy. It exempts lawmakers who first served in the Legislature before 1995. That means six veteran lawmakers who voted for the bill won't see any reduced benefits: Senate President Peter Courtney, D-Salem, Senate Democratic Leader Kate Brown, D-Portland, Sen. Frank Shields, D-Portland, Sen. Joan Dukes, D-Astoria, Sen. Avel Gordly, D-Portland and Sen. John Minnis, R-Wood Village. "They've exempted longtime serving members from having to switch," said House Majority Leader Tim Knopp, R-Bend, who championed the House bill. "It's the exact reason that legislators need to be removed from PERS completely, so they don't continue to deal themselves the best deal." A few days before Friday's vote, Courtney said he wasn't following Senate changes to the House bill and the issue hadn't come up for much discussion. "I think treating (lawmakers) like everybody else might be the way to go," he said. New PERS reforms signed into law will phase out the Money Match system. That means future pensions will be set by workers' final salary and years worked, not the size of their accounts. Police and firefighters get a pension equaling 2 percent of their final salary for every year on the job, or 50 percent of their final salary after 25 years. General service PERS members get 1.67 percent of salary per year worked, or 50 percent of final salary after 30 years. "To take them out of police and fire, I think, was a good idea," said Russ Walker, a PERS critic and Northwest director of Citizens for a Sound Economy. But no lawmakers should remain in PERS, he said. "There's a real loss of trust in government and most public officials, and this kind of thing, I don't know if it serves them well." Walker said his group will turn in an initiative petition next week that would scrap PERS for all public employees and replace it with a 401(k) plan.

06/09/2003
PERS
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PERS

BY Steve Law

The state House and Senate are at odds over whether lawmakers should remain in the state pension system. House members voted in March to yank lawmakers from the embattled Public Employees Retirement System and create a special 401(k) plan for them. Rejecting that idea, the Senate voted Friday to reduce lawmakers’ PERS benefits, by eliminating their preferred benefits package normally reserved for police and firefighters. The Senate passed House Bill 2407-C by a 16-11 margin.

06/07/2003
Capitol Protests Hit From 2 Sides
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Capitol Protests Hit From 2 Sides

BY Peter Wong

To get a sense of what some Oregonians think lawmakers should do about the state budget, all you had to do was hang around the Capitol for a few hours Thursday. The latest forecast of state income, which is down almost $700 million for the next two years, did not change some people's minds. On a chilly Thursday morning, on the Capitol's front steps, about 100 advocates and recipients of social services rallied under the banner of the Human Services Coalition of Oregon. They opposed more spending cuts and supported higher taxes or reduced tax breaks. On a chilly Thursday afternoon, on the Capitol's west steps, about 100 people rallied under the banner of Oregon Citizens for a Sound Economy. They opposed higher taxes or reduced tax breaks and supported more spending cuts and efficiencies. Both sides had their stories to tell. Beverly Bettis of Hubbard sat at the edge of the morning rally. At age 68 with multiple sclerosis, she relies on caregivers under Oregon Project Independence to lift her from bed each morning, give her a bath, put her in a wheelchair and put her back into bed at night. It costs the state $400 per month. But the alternative for her is a nursing home at $3,000 per month, much of which could be paid from federal grants. She would lose her home. "This service makes so much of a difference in the value and quality of my life," Bettis said. "I am able to be involved and participate in church and community activities. Otherwise, I am stuck at home." What is left of Oregon Project Independence, established 25 years ago, would be eliminated in the draft proposal by the Legislature's budget writers. "I continue to hope that they can find new revenue and ways to balance things," Bettis said. Michael Koester of Ashland, who also uses a wheelchair, arrived the previous day to meet his legislators. The commercial artist created cardboard cutouts of human figures with one-sheet descriptions of what various state spending cuts have done to people. The cutouts were lined up around the human services rally, and people were invited to supply descriptions by computer. "The concept was to represent Oregonians of all kinds - not just people with disabilities, but people who never get seen up here," said Koester, who himself has been in danger of losing in-home care. "I'd like lawmakers to see the real faces behind their decisions." Steve Mitchell of Ashland had a differing view. He said his dry-cleaning business has been forced to close three of six locations and reduce employees from 26 to 12. "That's real life," Mitchell said. "I had to cut everything I could to stay alive in business. As a citizen, I am saying that government has to do the same thing." He supports proposals by Citizens for a Sound Economy and the Taxpayers Association of Oregon to overhaul the public-pension system, eliminate vacant state jobs, find more efficiencies in agencies, and transfer some government functions to the business sector. Bill and Donna Cain of Rogue River also were part of the Citizens for a Sound Economy group. Donna Cain, current secretary of the Oregon Republican Party and a 1998 candidate for nomination to the Oregon House, said legislators are making progress with scaling back the long-term unfunded liability of the Public Employees Retirement System. "We are encouraged by what has been done so far," she said. "But we are hoping that it continues because PERS is costing the state billions. Anyone else in any other kind of business does not get that kind of retirement guarantee." Bill Cain said that efforts ought to be extended to paring other payroll costs in the public schools. "We need to return control of the education system to the people and out from under the unions," he said. Rob Wheaton of Portland relies on medications to keep his body from rejecting the transplanted heart he received six years ago. He had been living with an enlarged heart. When voters rejected an income-tax increase Jan. 28, it triggered elimination of state assistance to Wheaton and more than 8,000 "medically needy" people with high medical expenses but unable to qualify for Medicaid. The Legislature restored medications for transplant and AIDS patients through June 30. Before that restoration, Wheaton said he was down to a three-day supply of medication, some of it obtained from others. He is worried that the state cutoff will stand - and he has not received any free or reduced-price medications from drug manufacturers. "For me, it's difficult to watch my pill supply dwindle," said Wheaton, who's 29 and looking for work. "It has become an hourglass of my life. I see those pill boxes getting smaller and bottles getting emptier. I see death coming."

05/16/2003
Capitol Protests Hit from Two Sides
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Capitol Protests Hit from Two Sides

BY Peter Wong

To get a sense of what some Oregonians think lawmakers should do about the state budget, all you had to do was hang around the Capitol for a few hours Thursday. The latest forecast of state income, which is down almost $700 million for the next two years, did not change some people's minds. On a chilly Thursday morning, on the Capitol's front steps, about 100 advocates and recipients of social services rallied under the banner of the Human Services Coalition of Oregon. They opposed more spending cuts and supported higher taxes or reduced tax breaks. On a chilly Thursday afternoon, on the Capitol's west steps, about 100 people rallied under the banner of Oregon Citizens for a Sound Economy. They opposed higher taxes or reduced tax breaks and supported more spending cuts and efficiencies. Both sides had their stories to tell. Beverly Bettis of Hubbard sat at the edge of the morning rally. At age 68 with multiple sclerosis, she relies on caregivers under Oregon Project Independence to lift her from bed each morning, give her a bath, put her in a wheelchair and put her back into bed at night. It costs the state $400 per month. But the alternative for her is a nursing home at $3,000 per month, much of which could be paid from federal grants. She would lose her home. "This service makes so much of a difference in the value and quality of my life," Bettis said. "I am able to be involved and participate in church and community activities. Otherwise, I am stuck at home." What is left of Oregon Project Independence, established 25 years ago, would be eliminated in the draft proposal by the Legislature's budget writers. "I continue to hope that they can find new revenue and ways to balance things," Bettis said. Michael Koester of Ashland, who also uses a wheelchair, arrived the previous day to meet his legislators. The commercial artist created cardboard cutouts of human figures with one-sheet descriptions of what various state spending cuts have done to people. The cutouts were lined up around the human services rally, and people were invited to supply descriptions by computer. "The concept was to represent Oregonians of all kinds -- not just people with disabilities, but people who never get seen up here," said Koester, who himself has been in danger of losing in-home care. "I'd like lawmakers to see the real faces behind their decisions." Steve Mitchell of Ashland had a differing view. He said his dry-cleaning business has been forced to close three of six locations and reduce employees from 26 to 12. "That's real life," Mitchell said. "I had to cut everything I could to stay alive in business. As a citizen, I am saying that government has to do the same thing." He supports proposals by Citizens for a Sound Economy and the Taxpayers Association of Oregon to overhaul the public-pension system, eliminate vacant state jobs, find more efficiencies in agencies, and transfer some government functions to the business sector. Bill and Donna Cain of Rogue River also were part of the Citizens for a Sound Economy group. Donna Cain, current secretary of the Oregon Republican Party and a 1998 candidate for nomination to the Oregon House, said legislators are making progress with scaling back the long-term unfunded liability of the Public Employees Retirement System. "We are encouraged by what has been done so far," she said. "But we are hoping that it continues because PERS is costing the state billions. Anyone else in any other kind of business does not get that kind of retirement guarantee." Bill Cain said that efforts ought to be extended to paring other payroll costs in the public schools. "We need to return control of the education system to the people and out from under the unions," he said. Rob Wheaton of Portland relies on medications to keep his body from rejecting the transplanted heart he received six years ago. He had been living with an enlarged heart. When voters rejected an income-tax increase Jan. 28, it triggered elimination of state assistance to Wheaton and more than 8,000 "medically needy" people with high medical expenses but unable to qualify for Medicaid. The Legislature restored medications for transplant and AIDS patients through June 30. Before that restoration, Wheaton said he was down to a three-day supply of medication, some of it obtained from others. He is worried that the state cutoff will stand -- and he has not received any free or reduced-price medications from drug manufacturers. "For me, it's difficult to watch my pill supply dwindle," said Wheaton, who's 29 and looking for work. "It has become an hourglass of my life. I see those pill boxes getting smaller and bottles getting emptier. I see death coming."

05/16/2003
What's Next
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What's Next

The quarterly economic and revenue forecast for state government will be presented at 9 a.m. today in Hearing Room A of the Capitol to a joint meeting of the House and Senate revenue committees. A rally urging lawmakers to consider more money for public schools and state services, either through higher taxes or reduced tax breaks, is scheduled for 10 a.m. on the front steps of the Capitol. Oregon Citizens for a Sound Economy, which opposes higher taxes, has scheduled a news conference for this afternoon.

05/15/2003
Tax Vote's Impact Huge - Pass or Fail
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Tax Vote's Impact Huge - Pass or Fail

BY Steve Law

The unthinkable will happen in Oregon come Election Day, no matter how Tuesday's vote turns out for a three-year income tax increase. The measure's defeat, barring a change of heart from lawmakers, will force some seniors and disabled people out of their care homes. State police will be laid off. School children will be sent home for the year in May. But if Measure 28 wins, which seemed implausible a few weeks ago, the election will mark the first time Oregonians voted to raise general taxes since 1930, the early days of the Great Depression. And if recent polls are to be believed, the measure just might pass, sending political ripples across the nation. "If the voters do adopt this in Oregon, I think that will embolden lawmakers in other states to do what they are doing," said Dane Waters, a national authority on ballot measure campaigns. "I really think this will be a trend-setter." In the fall, nobody except true believers gave the measure much chance of passing. Republican legislative LEADERS agreed in September to put the tax increase before voters, but that was largely to end a bruising special legislative session and avoid passing controversial spending cuts right before fall elections. Some Republicans even boasted that they would vote against the measure as they agreed to refer it to voters. As if to seal its defeat, GOP leaders assured that bland explanatory language would accompany the measure on the ballot. "The wording of it is atrocious," said Chuck Bennett, an education lobbyist who has run several statewide campaigns. "I think it was put out there to fail." Early polls showed Measure 28 down by 25 percentage points. History shows that a tax increase must start with a healthy lead in polls to have a chance. Traditionally, support peels away as the campaign heats up. Political analysts said it was a horrible time to persuade voters to raise taxes, with Oregon having the nation's highest jobless rate. Democratic Gov. Ted Kulongoski, a gubernatorial candidate when the measure originated, endorsed it, but it nearly cost him the election. Business and labor groups that might otherwise support the campaign decided to hold onto their wallets. Grass-roots effort Despite the long odds, parents and social-services providers and other supporters wouldn't give up on Measure 28 without a fight. Mike Rosen, a state worker and father of two elementary school students, remembers that only 50 people showed up at a mid-October rally for Measure 28 in Portland's Pioneer Courthouse Square. They stood around and talked about the need to mobilize more people. Vicki Hersen of the group Elders in Action took down everyone's names and agreed to call a later meeting. "It just snowballed from there," said Rosen, who started an unofficial Measure 28 Web site and sent out e-mails to hundreds of education supporters. By mid-November, when public-employee unions committed money to hire campaign staffers, the grass-roots activists already were in motion. Organized groups were working in Portland, Eugene, Pendleton, Medford and Ashland. "There were 250 people at a Pendleton forum on this," said Chuck Sheketoff, human-services advocate and head of a Silverton think tank. "Other than the Round-Up, you tell me what gets 250 people in Pendleton together." Like the recent anti-war demonstration in Portland that attracted 25,000 people, the campaign was largely organized through e-mail. One message from then-Gov. John Kitzhaber went out to thousands of homes, and people forwarded it to their friends. People reported getting the same e-mail from three or four different sources, Rosen said. Unions downplayed their efforts, in part to avoid stirring up conservative and anti-tax opponents. "Early on, we knew that the Yes on 28 people were going to run an underground campaign," said Russ Walker, local leader of Citizens for a Sound Economy. "Politically, it was a wise move." But partly, it was because supporters couldn't mobilize the million-dollar campaign most thought would be needed to be competitive. Campaign spending reports showed that supporters raised closer to half that amount. "By being as low-budget as it is, it's by necessity sort of stealth, below the radar," Bennett said. Opposition napping Critics of Measure 28 initially figured it had no chance and were slow to raise money. "If you gave me 50,000 or 60,000 bucks, it'd get beaten cold," said Don McIntire, co-author of the 1990 property tax limitation that reignited Oregon's tax revolt. But none of Oregon's well-heeled conservative political donors stepped up this time, he said. The Taxpayers Association of Oregon, started by McIntire, relied on bumper stickers, lawn signs and a smattering of radio ads. The Oregon Republican Party mostly stayed on the sidelines until forking over $14,000 for a mass phone-calling campaign late in the effort. Bill Sizemore's Oregon Taxpayers United, battered by a series of legal and political defeats, has been a non-factor. Citizens for a Sound Economy stepped in to fill the void, but Walker's group couldn't match the grass-roots fervor of parents, teachers and social-services advocates. He marveled that campaign supporters did voter outreach to people in nursing homes, who could suffer from the measure's defeat. News stories pivotal Both sides in the campaign say news coverage has helped shift voter sentiment in favor of the measure. When newspaper, radio and television reporters sought to explain Measure 28 to readers, listeners and viewers, they featured students, seniors, disabled people and others affected by likely budget cuts if the measure is defeated. Measure 28 opponents complain that the taxpayers' side was neglected. But stories about senior citizens threatened with eviction were more compelling than stories about people facing a tax increase of $100 or less per year. Middle-income Oregonians will pay around $70 per year if Measure 28 passes, Sheketoff said, and the majority of seniors will pay nothing. "A lot of people wind up voting with their heart instead of their heads," McIntire said. "They see, 'Geez, old people are going to be cast out into the snow.'" Democratic pollster Lisa Grove said the campaign grew competitive because supporters were able to demonstrate the human impact of Measure 28's defeat, down to the local level. Supporters were able to turn it into a school levy-style campaign, where voters know their money will go to services they support, she said. Grove also credits Kulongoski, who, since his election, has stressed fiscally conservative themes. Some say voters have been educated about the reality of state finances after five special sessions last year and continuing news coverage of the state's fiscal crisis. "It's a historic change," Rosen said. "People know now, for the first time in a long time, where their taxes go." New precedent Nobody is calling the race until it's over. But supporters say that even if they come close, it will be historic. Since the 1930 income tax vote, Oregon voters have rejected sales taxes nine times and income tax increases six times. Oregon crawled out of its last major recession in 1982 by temporarily raising income taxes. But that increase was proposed by a Republican governor, Vic Atiyeh, and endorsed by a Democratic Legislature. It never made it to the ballot. Since that time, Oregonians have been much more likely to use the ballot box to cut taxes rather than raise them. The only successful statewide tax increases were for cigarette taxes. Across the nation, 27 states increased taxes in 2002 to deal with budget problems. But none was approved at the ballot box except for tobacco taxes. If Oregonians vote to raise the income tax Tuesday, "that would be the first general statewide tax increase in a long time" to come from voters anywhere in the country, said Mandy Rafool, a tax specialist for the National Conference of State Legislatures. If Measure 28 passes, it would represent a redemption of sorts for Kitzhaber. The once-popular governor expended much of his political capital holding out for a three-year income tax increase during last year's special legislative sessions. He aroused the ire of Republicans by vetoing their alternate plans, practically forcing the income tax measure onto the ballot. Even if Measure 28 is defeated, its comeback in the polls could shift the political terrain in Oregon after more than a decade of tax cuts. "If they get close," Bennett said, "I think anyone who says the public is opposed to tax measures has to make a much stronger case."

01/27/2003

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