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Tension over revenue, transportation erupts into confrontation at Capitol

Republican accuses union leaders of using 'political blackmail' to press agenda.

PARIS ACHEN/CAPITAL BUREAU - Sens. Brian Boquist, R-Dallas, left, and Lee Beyer, D-Springfield, discuss the state transportation funding bill before a meeting at the Oregon Capitol in Salem May 8, 2017.SALEM — Tension over a state transportation funding bill erupted into a confrontation between union leaders and lawmakers during a hearing on the legislation Wednesday, June 7.

Some union leaders indicated at the hearing that they would oppose the bill if legislators fail to pass corporate tax reform this session, which ends July 10.

"We believe it would be a mistake to leave this session in solving one problem and leaving the other for another day and another session," said Steven Demarest, president of SEIU Local 503.

The union represents 55,000 in Oregon, including employees of the Oregon Department of Transportation, homecare workers and others.

"The transportation package would tax workers, drivers and car owners. At the same time, the current budget would cut the hours for homecare workers who care for seniors and people with disabilities, meaning many would face decreases in their pay," he continued.

His testimony prompted Sen. Betsy Johnson, D-Scappoose, to ask: "Is SEIU really willing to sacrifice the transportation package…if revenue doesn't materialize?"

"We believe they have to go together, yes," Demarest replied. "We don't believe the transportation package goes through without revenue reform."

Sen. Brian Boquist, R-Dallas, who sits on each of the joint committees responsible for the transportation package and revenue reform, then spoke up and accused Demarest of playing "political blackmail."

Demarest denied that unions are trying to blackmail lawmakers.

"We're here to protect and advocate for working Oregonians, in particular low- and middle-income Oregonians, so the idea that workers, individual taxpayers are currently paying more than their fair share to increase that burden even greater is not acceptable," the union president said.

Boquist retorted that Demarest was "proposing is one or the other."

"If you want to play political blackmail games, let's make sure it's all over every newspaper in the entire state," Boquist said. "… I am one of the individuals that has to put this thing together on both sides, and your union isn't helping; your union is hurting, … and no, I'm not interested in listening to you anymore."

Throughout negotiations over the transportation bill, lawmakers aimed to craft a package that would be at low risk of a challenge at the ballot.

Another union leader, Dan Smith of Yamhill County SEIU, spoke to the legislator's greatest fear, suggesting that voters might try to refer the package to the ballot and defeat it.

"If it were a good deal, I would suggest it wouldn't collapse by voters," Smith said.

Unions have been trying to recover after suffering a setback at the ballot last November when they attempted to pass a measure that would levy a tax on corporate sales. Business groups unified to defeat the measure. The Joint Committee on Revenue Reform has been working on a proposal for a commercial activity tax on corporations, which would raise less revenue that the tax that voters cast down in November.

Wednesday's hearing marked the last of three on the transportation funding bill. The series of hearings began Monday and drew more than 130 speakers over the three days.

The bill identifies a few specific projects to ease congestion, but other projects would be prioritized by the Oregon Transportation Commission. Specific projects would:

• Add lanes on Interstate 5 near Portland's Rose Quarter from Interstate 84 to Interstate 405.

• Add northbound and southbound lanes on Highway 217 through the Portland metro area.

• Widen Interstate 205 to six lanes from Oregon City to Stafford Road.

• Widen and seismically reinforce Interstate 205's Abernethy Bridge.

The plan raises an average of about $800 million per year in additional transportation funding.

The money would come from increases in the gas tax and vehicle fees and a set of new taxes over the next 10 years, including:

• Gradual gas tax increase from 30 cents to 42 cents by 2025.

• Tiered increase in title and registration fees, depending on type of vehicle. Surcharge of $100 for electric vehicles, and $15 for other vehicles.

• Statewide payroll tax of 0.1 percent to pay for mass transit.

• Tolls to be determined.

• Bicycle excise tax of 3 percent.

• Dealer privilege tax of 0.75 percent on new and used vehicle purchases.

Legislative staff recently released an index to help guide readers through the 298-page bill.

The committee is scheduled to meet to discuss potential revisions to the bill at 5 p.m. Thursday, June 8, in Hearing Room F at the Capitol, 900 Court St. N.E.

Paris Achen
Portland Tribune Capital Bureau
email: pachen@portlandtribune.com
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