August 8, 2005, 2005         73^rd Session, Final Issue

In This Issue of Whitsett at the Capital

• End of Session Newsletter
• Session Summary: Highlights and Lowlights of the Session
• Some Thoughts on the Public Employee Compensation Issue

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Dear Friends,

We finally did it.  It took more days than any session in Oregon history, save one, but the 73^rd Oregon Legislature has finished its business.  The final flurry of action kept most legislators and staff here at the capitol for 24 hours straight.  The final budget bills were passed, some last minute deals were made and some bills came back to life, while others finally died.  This final newsletter of the session includes a session summary (below) detailing the highlights and the lowlights of my first session in the Oregon Senate.

Once the dust settled, and having had a weekend to reflect, I am convinced that overall the session was far more positive than negative.  Some good laws were passed, many bad laws were turned away and we balanced the budget without taking any more money out of your pocket.  I think that is a win for Oregon and I am proud to have been a part of most of it.

This legislature developed some groundbreaking policy during the course of this session.  Two prominent examples that are gaining national recognition including the meth package and the mental health parity bill.  I supported both of these policies and am convinced that they will improve the lives of all Oregonians.

In addition, there are a couple bills that I am proud to bring home to Southern Oregon.  Teaming with Representatives Garrard and Gilman as well as the talented administration of OIT, I worked to bring the Oregon Center for Health Professions to OIT.  I also took a little heat in a Portland newspaper for my efforts to provide a rate-shock safety net for Klamath irrigators.  It was heat that I was pleased to bear because the rate-shock bill is a piece of legislation that I am proud of.  I discuss each of these bills in greater detail in my session summary below.

One of the most positive developments of the session was an event that never took place.  The legislature didn’t attempt to raise or increase your taxes.  A budget agreement in early March virtually took the issue off the table and the state was all the better for it.  Though many cried that services would suffer and that we would need to increase revenue, we elected to follow a different path.  We acted like we were on a budget.  When we saw what we had to work with we tightened our belts a little and adjusted our spending to the revenue available.  I think this is a concept that many Oregon families understand and I was pleased to see the legislature follow suit.  Oregon voters have made it clear in no uncertain terms that they believe the state can make do with what the voters currently provide.  It seems the legislature got the message.  Your relentlessness paid off.  Congratulations! 

For all the positive developments, there were some areas where the legislature was completely “missing in action.”  The most prominent example of this is the failure to take any action on the unsustainable rate of public employee compensation.  I develop this idea more fully in my session summary below but sufficed to say, this problem will not go away until the legislature does what it must, rather than what is politically expedient.

As the session ends and I prepare to return home, I want to thank all those of you who have given your support and made your voice heard during the course of the session.  The legislature provides a steep learning curve for a “true freshman,” but I think my staff and I successfully found our way.  One of the key aspects of our success was your input and your support.  For that I thank you.

I also learned that one can quickly get bogged down in all of the process and procedure.  My response to this was to simply approach each vote on its own terms.  I gave every bill an up or down vote based on its merits.  In doing so, I always considered the impact of the legislation on the State and more specifically on the people of rural Oregon.  You are the ones that put me in this position and it is your voice that I tried to represent with my vote.

I look forward to seeing many of you a little more often as Gail and I return to Klamath Falls. Thanks again for all that you have done to make this session a success.  We have much to be proud of and much work still left to complete.  I look forward to continuing to work with you in order to improve the quality of life for rural Oregonians.

Regards,

Doug

Please Stay in Contact During the Interim
Capitol Phone: 503-986-1728
Capitol Address: 900 Court St NE., S-302, Salem, OR, 97301

Interin Phone: 541-883-4006

Interim Address: 23131 North Poe Valley Road, Klamath Falls OR 97603
Email: sen.dougwhitsett@state.or.us
Website: http://www.leg.state.or.us/whitsett

Session Summary

Senate Bill 1—Mental Health Parity

I was proud to support this legislation which put mental disorders on equal footing with other physical disorders in terms of insurance coverage.  I broke with some in my caucus to support the bill, but it had broad bi-partisan support and is one of the most groundbreaking pieces of legislation passed by Oregon’s 73^rd legislature.  I felt it was important that we recognize that a mental disorder can be every bit as debilitating as any physical disease.  For the state to continue to distinguish between the two for purposes of insurance was simply unjustifiable in my view.  I was proud to support this important legislation and hope that it will alleviate some of the pain and improve the quality of life for many Oregon families.

House Bill 2485 and Senate Bill 907--The Meth Package

Despite the lack of teamwork on the budget, the legislature demonstrated an admirable level of collaboration in attempting to solve the statewide meth epidemic.  Nobody can doubt the debilitating effect that meth has had on our state.  This menace breaks up families, leads to increased crime, ruins neighborhoods and hinders economic development.  The manufacture and distribution of meth is literally killing our state in a hundred different ways.  This Legislature took decisive action to rid our state of this scourge.  First, and most controversially, we restricted access to precursor chemicals in order to reduce the manufacture of meth by labs in our communities.  In my mind, requiring a prescription for drugs containing ephedrine is wholly appropriate given the impact meth has had on our state.  While this added layer of regulation will certainly cause some difficulty for a small segment of the population, I consider it necessary to reduce the manufacture of meth by labs in Oregon.  Second, we provided law enforcement with the tools they need to fight back and to deal with some of the unfortunate effects of meth crimes.  These tools include:

·        Enhanced penalties for manufacture and distribution of meth

·        Enhanced penalties for contamination of drug site labs and disposition of toxic wastes

·        Created fair and balanced criminal and civil forfeiture laws to improve law enforcement’s ability to interdict the shipment and distribution of drugs

·        Increased staffing and funding for drug courts

·        Increased staffing and funding for drug treatment and rehabilitation

·        Enhanced penalties for drug related child and domestic abuse

Senate Bill 81—Rate Shock

In terms of sheer time spent negotiating, I worked as hard on this bill as any other bill of the session.  This bill provides a needed safety net for Klamath irrigators who can expect a huge spike in their utility rates next year when their contract with Pacific-Corp. expires.  When it was all said and done, the bill passed with a strong bi-partisan majority because most people recognized that a utility rate hike of up to one thousand percent was worthy of mitigation.  This legislation doesn’t cap rates but does provide mitigation over a period of time so that irrigators may adjust.  It was good policy and I was pleased to be able to work with the Governor’s office and other groups in order to get it passed into law.

House Bill 2754—The OIT Bill

This is another bill that I am pleased to bring home to southern Oregon.  It will create the Oregon Center for Health Professions at Oregon Institute of Technology.  The best thing about this bill is that OIT developed the plan, they garnered the support and then came to the legislature.  They didn’t ask for funding, they asked for our stamp of approval in order to set up the necessary partnerships.  President Dowe of OIT is a visionary and Oregon’s institutions of higher education have a great deal to learn form her outside-the-box thinking and her ingenuity.  With the partnerships that this bill creates OIT will be able to double the amount of students that it admits, becoming the center for educating the next generation of Oregon’s health professionals.

Senate Bill 640

This bill provides an added layer of protection against identity theft and is also closely related to Oregon’s meth problem.  Senate Bill 640 will simply add a digital scan of the photograph that is already taken when you apply for a driver’s license.  By scanning all photographs for new licenses and checking them against the state database we will be able to determine when persons are applying for multiple licenses.  This is a necessary step to improve the security of our driver’s license which is one of the least secure in the entire country.  Making this a more urgent problem is the fact the almost 90 percent of identity theft in Oregon is related to the meth trade.  By strengthening the security of our driver’s license, we also improve our odds in the fight against meth.  Those are two strong reasons why I supported this legislation. 

Education Budget

As anyone who hasn’t been in a cave knows, this was the major sticking point of the session.  My overall feeling is that the budget had some strong points and some weaknesses.  We provided adequate funding for K-12 education to maintain current services in most districts.  In addition, we increased the standards for high school graduation which will begin in 2009.  We enhanced funding for opportunity grants for all eligible students, capped tuition increases and made strong investments in Oregon University System capitol construction.  I was very pleased that we were able to restore all of the Governor’s cuts to community colleges and then some, but we failed to adequately fund the capitol construction needs of the community colleges.  The one area where no appreciable action was taken was in regards to accountability of schools that fail to apply the funding expenditures properly or continue to under perform.  In addition, as I discuss in my article below, the unsustainable rate of public employee compensation was considered to hot to even discuss.  This is something that must change.

Public Safety

While some strides were made to improve public safety, I was discouraged that we failed to better prioritize spending in order to more adequately fund this most important issue.  For example, the Oregon Department of Fish and Wildlife employs 25 more people than the Oregon State Police.  The critical issue of safety in our homes, persons and communities requires more of us.  However, some forward progress was made.  We restructured the State Police to put about 20 more officers on the road.  This is a pittance, but it is a step in the right direction.  We also enhanced the community corrections budget and created nine new circuit court judges.  While these are important strides, I hope we will be able to do more to improve public safety in Oregon.

Senate Bill 71-Connect Oregon

This bill left the Senate as a very good bill that had my wholehearted support.  It returned to us from the House a potentially imbalanced bill that I offered my somewhat grudging support.  Connect Oregon provides $100 million in lottery bonds to fund non-highway transportation projects throughout the state.  The idea is to create jobs and get products moving around the state.  The Senate made some improvements to the bill that would have ensured that a share of the funding would have gone to projects in all parts of the state.  It also included a provision that would allow communities to obtain a loan, if they were unable to raise the matching funds.  Both of these aspects were critical to allowing rural areas to compete for their share of the dollars and both aspects were stripped from the bill by the House.  I voted for the amended bill because I still supported the policy, but my fear is that the $100 million in lottery bonds will be used to connect Portland rather than to achieve the original intent of connecting all of Oregon.  Time will tell if I am correct.

Senate Bill 1037

In the end, I was pleased to see this bill end up where it did; nowhere.  I came to the legislature vowing to protect the clear intent of Measure 37.  In my mind, the voters sent a clear message regarding private property ownership and I simply refused to go tinkering around with it.  While some say that the bill was nothing more than an implementation plan, a reading of the bill proves otherwise.  I realize that a waiver provision was added at the last hour in order to gain support of property rights proponents, but there were other factors in the bill that concerned me.  In the end, I think we are all better off with this legislation where it currently is, dead and buried.  There was too much wrong with the bill for it to be right.  What is right is that Oregonians articulated a clear intent with Measure 37.  I think Senate Bill 1037 could only have undermined that intent.

House Bill 3462—The Jobs Plus Reauthorization Act

This bill held out until the bitter end before finally losing all steam in the waning hours of the session.  The bill would have re-authorized the Jobs Plus program that promoted economic development by creating jobs, improving production and developing a better trained workforce.  At the same time it reduces the demand for costly social services.  The worst part about this bill’s failure to move was that the votes were there to pass the bill.  We had the votes in both the House and the Senate.  We had the votes in the Senate Rules Committee.  It was a priority bill for the Senate Republican Caucus.  The fact is that this bill died because the House leadership refused to move the bill until it was too late.  This caused a major confrontation on the final night of the session.  It was a dysfunctional and unnecessary end for a good piece of legislation that is supported by the employers and employees who use the program.  I hated to see this bill die, but the way that it died was even more unfortunate.

Senate Bill 527—The Fair Energy Siting Bill

Not many bills pass the Senate 29-0 only to disappear never to be heard from in the House.  This in one bill that can claim that dubious distinction.  I was so disappointed to see this bill die because it had such obvious bi-partisan support and because I worked so hard with Senator Bill Morrisette to pass the bill out of the Senate.  Senate Bill 527 would have restored the local voice to energy siting.  Those in Klamath County know all too well how the Energy Facility Siting Council can disregard local input in order to site an energy facility and this bill would have restored some balance to the process.  I could not understand the failure of the House leadership to move the bill and I probably never will.  It was good policy and you deserved it.  

Civil Unions and Sexual Orientation Discrimination

The rhetoric on this bill got a lot hotter than anything else.  The fact is and has always been that both concepts were dead on arrival.  They never stood a chance at passing the House.  What did stand a chance was the reciprocal benefits legislation introduced in the House, but the other side wanted little to do with that.  The whole fight amounted to little more than political theater.

Public Employee Compensation: The Problem that Will Not Go Away

            Anybody that has had the chance to discuss Oregon politics with me for longer than five minutes has probably heard me discuss the crisis that Oregon is facing in terms of the unsustainable rate of public employee compensation.  It is NOT a myth dreamt up by some conservative right-wing Republican, the crisis if very real and if we do not act to reverse it, we are in serious trouble.  I wanted to take a few minutes at the end of a session when this problem was ignores, in order to share some thoughts on the issue with the hope of gaining some momentum to deal with the problem in the future.

The simple fact is that Oregon has a structural budget problem very similar to a family that has over extended their credit. It is always much easier to purchase services or products on credit than it is to pay as you go. Many families have experienced the financial and social distress caused by over extending their credit to the point that their earnings may not be able to pay the principle and interest on their debt. Unexpected expenses or the loss of a job results in immediate catastrophic financial consequences

The state of Oregon is currently in that situation. Over time our State has made promises in contracts that incurred huge future debt. The greatest of these promises include public employee retirement benefits and long term commitments to provide medical insurance premium benefits to public employees. No means have been established to adequately fund these debts. Most knowledgeable legislators understand the predicament but find it politically inexpedient to address the problem.

Public employees generally receive much better employee compensation than their peers in the private sector. In fact, a recent white paper funded by the Oregon Employment Department promotes expansion of state employment as an “economic development plan”. The paper oxymoronically reasons that creating more state jobs would create economic development because state employees are so much better paid than private sector employees. This paper explains that expansion of public employment would infuse more cash and more buying power into recipient communities. The paper did not address a sustainable means to fund these additional state jobs.

Nevertheless, public employees are receiving new contracts with biennial pay increases from 8 to 18%, maintaining fully funded health care premium benefits, retaining retirement benefits, and retaining workplace, sick leave, and vacation benefits. This Legislature has not even attempted to address any of the following issue

·        Unsustainable retirement benefit costs

·        Unsustainable health care benefit costs

·        Unsustainable cost/productivity ratios

·        Unsustainable administrative costs

It has further failed to enact any legislation that would improve employee accountability and productivity or create any sanctions for poor choices or sloth.

Conversely, our Democrat controlled Senate passed measures on virtual “party line” votes that would authorize public employee unions to organize unrepresented employees without a secret ballot vote, and that would incredibly eliminate the requirement that public employee contracts be in the “best interest” of the people of Oregon. Thankfully, these public employee union promoted measures were stopped in the Republican controlled House.

The “performance measures” required in the budgeting process are an early start in the right direction toward prioritization and accountability. Unfortunately, the state agencies routinely thumb their nose at these requirements because an agency’s failure to address these measures result in no sanctions. The Oregon Department of Education responded to more than 100 performance measures designed to improve public education with a terse “not applicable”. Just a few of those performance measures that the Department considers “do not apply” include:

·        % of enrolled Head Start/Oregon Pre-K children completing the program

·        % of Head start/Oregon Pre-K children entering school ready to learn

·        % of students in key subgroups achieving state standards for reading and math as a percent of state average.

·        % of students in key subgroups achieving high school diploma or GED before age 21 as a percent of the state average.

·        % of students in key subgroups who drop out as a percent of the state average.

·        % of students with documented truancy

·        % of persistently dangerous schools

No notable consequences occurred in subsequent funding or staffing for the Oregon Department of Education.

The “Little Davis Bacon Act” has done more to artificially inflate State construction and maintenance costs than any other single cause. This state “prevailing wage” law allows the Bureau of Labor and Industries to force all public work projects to be “gold plated” by essentially eliminating competitive labor costs on all state projects. The prevailing wage is generally calculated as the highest “union” wage paid for that service within the region. Just as previous legislatures have done, our 73^rd session failed to address this “sacred cow”.

Across the United States, on average, about 35% of the public employees are represented by unions in each state. In Oregon about 85% of the public employees are union members. As a direct result, the organization and combined financial lobbying ability of the Oregon Education Association (OEA), the Service Employee International Union (SEIU), and American Federation of State, County and Municipal Employees (AFSCME) is formidable. Although they represent a small percentage of Oregon’s population, their organization and financial lobbying efforts insure that their concerns are always on the front burner.

These are a few of the issues that confront us as we move forward.  I don’t have all the answers.  What I do have is a recognition of the problem and a willingness to work together in order to do something about it.  Unfortunately that is difficult when everyone wants to pretend the problem doesn’t exist.  But it does exist.  The cost of public employee compensation consumes an ever-increasing portion of our State’s budget.  The rate of increase is unsustainable.  It is true that we have a constitutional obligation to respect contractual obligations.  But we also have an obligation to avert an impending crisis when it is obvious to anyone what the result will be.  Lets work together to make that happen.