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OSCC Legislative Report
Review of Past Week (June 22 – June 26):
- House Bill 2075, the bill that would increase the jet fuel tax by 2 cents per gallon to fund infrastructure improvements to rural airports, breezed through the full Ways & Means Committee. The bill will raise and allocate over $7.5 million per biennium to meet the infrastructure, maintenance and economic development needs of the state’s local airports. The jet fuel tax has not been raised in 50 years. OSCC was instrumental in putting together a broad bipartisan coalition of legislators to move the bill forward. House Bill 2075 has been a key agenda item for OSCC to revitalize local airports across Oregon.
- Transportation Package / LCFS Repeal The Governor and Legislative leaders pulled the plug on the much-publicized transportation agreement that would have repealed the Low Carbon Fuel Program and added $200 million per year into road, bridge, and carbon reduction funding.
There were several controversial elements to the package, including a 4 cent gas tax, tolling on I-205 and new income taxes on workers who are employed in areas covered by transit districts.
The politics of passing this package were going to be exceedingly tough even with a well-crafted package, but what appears to have been the final straw was the revelation that ODOT’s numbers on the carbon reduction were off by 80%. In other words, ODOT overestimated the amount of carbon reduction that would result as a consequence of the agreement. Legislators would no longer be able to claim that this new agreement would offset as much or more carbon than the Low Carbon Fuel Standard.
Whether talks resume over the interim to try and put together another similar transportation package at this point is simply unknown.
- Senate Bill 129, the bill that would extend the state’s Gain Share program, finally moved out of committee and is on its way to the Senate floor. This bill is so significant because there has been increasing criticism of the Gain Share program due its escalating costs and a desire to end it. But the Gain Share program is extremely important to local governments because it reimburses them for lost property tax revenue when they use property tax incentives to help companies locate and grow.
While SB 129 will scale back the amount of revenue that can be sent back to local government to a maximum of $16 million per year, it will also preserve the program through 2024. The bill also has other significant benefits including the creation of a significant funding stream for Career & Technical Education and the Oregon State University extension programs.
- House Bill 2643 passed its last legislative hurdle last week when the Senate approved it unanimously. The bill significantly streamlines the application process for a local government applying for an Enterprise Zone and also eliminates numeric limit on the number of enterprise zones that may be designated at any time.
What We See Coming Up (June 29 – July 3):
Overall, it appears that the legislature is pressing ahead with a possible adjournment late this week. Major budgets have passed. The Senate has made clear that it does not need to pass tax credit extensions. Nearly all policy bills have been voted out of committee. Transportation package talks are now dead.
The last remaining major piece that needs to be approved is the customary legislation authorizing the bonded indebtedness for specific capital projects of statewide interest and the final “Christmas Tree” bill of remaining General Fund expenditures.
The pieces are in place for adjournment.
- Columbia River Water Storage funding will be decided and allocated in the final Capital Construction bonding bill.
- Local Airport Funding (House Bill 2075) will be voted on in the full House and Senate. Even though it is a tax measure requiring a 3/5th vote majority, OSCC feels very comfortable that the necessary spadework was done to secure passage by large majorities.
- Senate Bill 129, the extension of Gain Share, should see final approval this week.
- House Bill 2984, the Clackamas County pilot project for a forestry cooperative on non-forest land, should see passage this week.