No Breakthrough in Oregon Senate Negotiations

Oregon’s Senate standoff continued into its fourth week, the longest in state history, with no public signs of a breakthrough in negotiations. If anything, the public statements from the partisan leaders seemed only to sink their heels, perhaps even their elbows, deeper in the sand.

Senate Republicans committed to returning before the legislature is constitutionally required to adjourn on June 25, but only on the last day of the session to pass budget and bipartisan policy bills. Meanwhile, Democrats made it clear they are not interested in returning for last-minute votes just to pass budgets and Republican-endorsed bills, and kill their priorities by simply waiting out the clock.

In many ways, the walkout is reminiscent of the 2019 and 2020 walkouts. In both instances, Gov. Kate Brown (D) deployed the state police in a manhunt to locate the missing senators and compel their attendance to reconvene business on the floor. In 2019, a deal was struck, returning the Senate Republicans on the session’s last day, resulting in a vote-a-rama to get consensus bills to the finish line. In 2020, however, Democratic leadership refused to give over the keys to the session and the legislature adjourned with only three measures becoming law. Now, with 10 Republicans and an Independent boycotting proceedings, Democrats seem rooted in their unwillingness to kill bills to lure the absent members back into the building.

In his weekly column, Dick Hughes notes that Democrats have more on the line in the negotiations than Republicans. Democrats control the process and measures that appear on the floor, and precious priorities are at stake if normal legislative proceedings do not resume. Republicans have much less to lose and everything to gain from a prolonged walkout, especially with three-quarters now past the trigger for Measure 113’s prohibition on seeking reelection after missing 9 floor sessions without an excused absence.

Last week we wrote about the continuing resolution that prevents a state government shutdown if the legislature cannot complete its business for the session. While a summer special session could be likely, it is not without its challenges. The building is undergoing a major seismic and accessibility upgrade, disrupting a lot of the building’s public spaces during the current session. Soon after constitutional adjournment, the construction workers will take over the House floor for several months, leaving the chamber without its normal space to conduct its business. Although there are alternative meeting spaces available in the Capitol, the construction presents a logistical quirk in the event a summer special session becomes necessary to hammer out state budgets.

While the public statements seem worlds apart from a deal, there are some breadcrumbs of progress beginning to appear. Gov. Tina Kotek (D) is engaging the caucuses to assess the state of affairs in the building while avoiding, at least for now, playing the role of a broker. Still, the governor has a vested interest in the legislature adopting its biennial budget. If the legislature adjourns without adopting agency budgets, the executive branch could face the logistical challenges of managing cash flow and delays in implementing legislatively mandated spending. The continuing resolution serves as a fail-safe for essential services but does not end the disruptions of losing time to plan and implement funding decisions. Perhaps the budget chaos becomes a tea leaf for the parties to work their way out of the crisis.

Democratic Leadership Announces Largest Investment in K-12 Education

On Monday, House Speaker Dan Rayfield (D-Corvallis) and Senate President Rob Wagner (D-Lake Oswego) announced an increase in the state’s share of funding local schools, adding $300 million to the planned $9.9 billion investment in the early drafts of the state budget from budget leaders and the governor. The increase corresponds with the state economist increasing the projected revenues from the corporate activity tax, a tax on business gross receipts dedicated to public schools, by $266 million.

The combined $10.2 billion dedication ($15 billion including local revenues) marks the state’s largest investment in public education but still falls short of the $10.3 billion school leaders say is necessary to avoid a shortfall. School districts are also raising concerns about the legislative walkout putting their local budgets in limbo with tight cash flow if lawmakers adjourn the regular session without adopting a budget.

House Uses Rare Parliamentary Tactic to Clear Calendar

Late last week, House Speaker Dan Rayfield (D-Corvallis) helped motivate legislators dazing out their office windows daydreaming about the summer-like weather: clear the third reading list and the chamber will cancel most floor and committee meetings next week. And accordingly, everyone committed to working long hours and cutting corners, within the bounds of the legislature’s rules, of course, to move through as many bills as possible.

On Tuesday, the House compiled a consent calendar, allowing the chamber to vote en bloc on measures approved unanimously by their committee. Once posted, House rules provide two days for members to object to including a bill on the consent calendar. If four members object to including the measure, it is removed from the listing and returned as a standalone bill, allowing lawmakers to debate and cast their votes. All the remaining measures on the consent calendar are approved or rejected without debate, clearing them from the third reading calendar.

On Thursday, the House approved 25 of its 55 measures scheduled for third reading using the rarely deployed consent calendar procedure and powered through the evening to work through the remaining bills. And their work paid off; the House does not reconvene for regular proceedings until Wednesday, May 31. It turns out that getting out of the building is a strong, bipartisan motivating force.

Senate Schedules Hearings on Controversial Kicker Bills

On Wednesday, May 31, the Senate Finance & Revenue Committee plans to hold hearings on three measures seeking to withhold the state’s personal income tax kicker. Oregon’s kicker law, a constitutional spending control requiring the state to return surplus revenues to individual taxpayers if tax collections exceed their original projections by two percent, has long been a target for funding advocates seeking additional funds to expand government programs.

For the state to retain the kicker, two-thirds of the legislature must approve rewriting the estimated revenues from the start of the biennium (in this case, June 2021). The supermajority threshold is an extremely high bar for the legislature to hold onto the kicker revenues and, almost always, is a point of contention across the spectrum of interests.

The legislature has only stopped the taxpayer refunds once, during the 1993 session, due to budget turmoil. During that session, the kicker was only a statutory policy. Then, in 2000, voters enshrined it and the supermajority requirement into the state constitution. Since then, the kicker has been a staple of Oregon’s fiscal politics and, generally, untouchable.

What We're Reading This Week

• On Monday, Gov. Kotek (D) held separate meetings with Senate Democrats and Republicans. All but one Senate Republican attended the meeting virtually over concerns about the meeting’s proximity to the Senate floor they were skipping.
• Oregon’s Department of Justice is slowing down public financing of affordable housing over a spat with private lenders over collateral, undermining the state’s efforts to boost affordable and accessible housing.
• Oregon’s largest private sector labor union, United Food & Commercial Workers, announced this week it would launch an effort to recall House Speaker Pro Tempore Paul Holvey (D-Eugene).
• Service Employees International Union 503, which represents roughly half of the state’s workforce, is negotiating a new contract before its current contract expires on June 30. The union announced this week that nearly one in five government positions are vacant.
• Senators accruing enough absences to trigger Measure 113’s prohibition on reelection are already preparing to fight the next round in the courts. Some legal experts believe their arguments could have some merit. Oregon's Elections Division is also asking the Attorney General for a legal interpretation of the measure's text.
• Many Oregonians have become familiar with the notion of “Greater Idaho” as rural counties consider resolutions asking to annex their territories to Idaho. However, a parody group has come out of the woodwork, calling for “Lesser Idaho,” which would move Boise and Sun Valley into Oregon.