TAPES 157-159, A-B





Members Present:††††††††††† ††††††††††† Senator Ryan Deckert, Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Ted Ferrioli, Vice Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Tony Corcoran

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Lenn Hannon

††††††††††† ††††††††††† ††††††††††† ††††††††††† Senator Rick Metsger

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator David Nelson

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Charlie Ringo

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Bruce Starr


Witnesses Present:††††††††††† ††††††††††† Senator Joan Dukes, District 16†††††††† †††††††††††

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Frank Morse, District 8

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Gary George, District 12

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Margaret Carter, District 22

††††††††††††††††††††††† ††††††††††† ††††††††††† Randy Tucker, 1000 Friends of Oregon

††††††††††††††††††††††† ††††††††††† ††††††††††† Matt Blevins, Oregon Environmental Association

††††††††††††††††††††††† ††††††††††† ††††††††††† Jim Torrey, League of Oregon Cities

††††††††††††††††††††††† ††††††††††† ††††††††††† Laura Pryor, Association of Oregon Counties

††††††††††††††††††††††† ††††††††††† ††††††††††† Darrell Fuller, Automobile Dealers Association

††††††††††††††††††††††† ††††††††††† ††††††††††† Roger Martin, Oregon Transit Association

††††††††††††††††††††††† ††††††††††† ††††††††††† Mike Salsgiver, Portland Business Alliance

††††††††††††††††††††††† ††††††††††† ††††††††††† John Watt, Medford Chamber/Jackson County

††††††††††††††††††††††† ††††††††††† ††††††††††† John Ledger, Associated Oregon Industry

††††††††††††††††††††††† ††††††††††† ††††††††††† Lynn Lundquist, Oregon Business Association

††††††††††††††††††††††† ††††††††††† ††††††††††† Mary Botkin, AFSCME Council 75


Staff Present:††† ††††††††††† ††††††††††† Paul Warner, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Dick Yates, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Tara Lantz, Committee Assistant





Chair Deckert

Calls meeting to order at 9:37 am.





Sen. Dukes

Explains that she and the other senators from the Ways and Means Subcommittee on Transportation and Economic Development are testifying because they were the reason the bill was brought back to the committee.





Sen. Morse

Testifies of the importance of HB 2041 but expresses concern with the sequestration section of the bill because they should not be adding additional burden to the General Fund when they do not have enough money to fund current obligations. Requests that the sequestration portion of the bill be amended out. Recognizes that there has been compromises made between stakeholders and that if an adjustment needs to be made to make equity and fairness, it should be done proportionally to the amount of the tax credit.





Sen. George

Discusses the concern that arose in hearing HB 2041 and learning about the sequestering of dollars. Expresses concern with the General Fund costs of the bill. States that he doesnít like bills that are done in the dead of night.





Sen. Dukes

States that they have requested for amendments to be drafted to remove the sequestration portion of the bill. Expresses concern with taking money from the General Fund when they are trying to balance the budget with the least amount of cutting of services. States that the bill should have been in Ways and Means. Discusses cost responsibility in the bill and the diesel engine tax credit.





Sen. Corcoran

Asks about an alleged road already determined to be built in Washington County with this money and asks what roads and bridges they are willing to not fund by taking out the sequestration.





Sen. Dukes

Responds that the sequestration has nothing to do with roads and bridges but rather is a $5 million a year fund piece that funds mass transit buses, a transportation demand study, and a tax credit to people who buy semiís that have a newer type of engine or replace existing engines with a less polluting engine.





Sen. Corcoran

Asks about Washington County.





Sen. Dukes

Replies that in Washington County, she attended a meeting where she was told there was a road in this bill in Washington County. States that it wasnít in there specifically by name but there was an agreement that road would be built and that transportation packages always have a separate list of projects.





Sen. Deckert

Asks if the members would pledge to fund the other components of the bill currently funded by sequestration if they removed the sequestration section.





Sen. Dukes

Responds that they wouldnít fund the tax credit.





Sen. George

Responds that the Senior and Disabled transit has already been added in Ways and Means.





Sen. Deckert

Asks for a yes or a no.





Sen. George

Responds that the committee would look deeper and that they already have taken some action. States that the tax credit is something that is required to be done already under federal law.





Sen. Carter

States that her concern is the General Fund dollars and that if they are taken out she will vote for the bill. Suggests looking at how to finance mass transit. States that this is taking $4 million from the General Fund up front that is borrowing against the revenues of the future.





Sen. Corcoran

Points out that Sen. Dukes said that part of that money was to fund mass transit.





Sen. Carter

Responds that it is and that is has nothing to do with bridges and roads.





Sen. Dukes

Clarifies that they are only talking about the pure general fund portion of the bill and that they cannot fund public transportation though road taxes constitutionally. States that there probably can be flex federal funding that can be used for a transportation demand study.





Sen. Carter

States that there are other means to fund the transportation demand study and other programs.





Sen. George

Declares that the idea of bonding is something he has always advocated and he fully supports the transportation package without the sequestered dollars.





Sen. Starr

Asks if the members of the Subcommittee would commit to supporting the bill if they adopted the proposed amendments.





Sen. Dukes

Replies that it depends on what else they do to the bill, but if that is the only thing done she would vote yes.





Sen. George

Responds that if there is no removal of the other fees he would vote yes. Declares that his problems with the bill were the General Fund dollars and the process. States that if they eliminate $3 million in heavy vehicle fees and $6 million in light vehicle fees it would eliminate cities and counties which desperately need money.





Sen. Morse

Responds that he would definitely support the bill.





Sen. Dukes

States that the freight mobility portion of the bill is poor and ties the hands of communities such as Astoria where the highway is the main street. Refers members to a letter from State Treasurer Randall Edwards that expresses concern about the policy of sequestration (Exhibit 1).





Sen. Metsger

Asks Sen. Morse for clarification on a comment about offsetting the diesel engine tax credit.





Sen. Morse

Responds that his concern is that any reduction in fees be proportional to the actual credit in the bill, which includes a sunset.





Sen. Metsger

Interprets that if they took the credit away they could only take the truck fees away until January 2007 because that is when the credit expires.





Sen. Morse

Responds that he doesnít have specifics on how to do that but that they need the ability to support the bonds.





Sen. Metsger

States that when they lower fees they start to get away from cost responsibility because if they lower the $3 million fee for the trucking industry, they have to lower the $6 million fee for light vehicles. Asks if that is acceptable.





Sen. Morse

Responds that the tax credit is not significant in the scope of the bill but it is significant for the General Fund.





Sen. Metsger

Asks if they eliminate the entire sequestration and the trucking industry opposes the bill, if their members would vote for the bill.





Sen. Morse

Responds that he doesnít know.





Sen. Metsger

Asks how the Subcommittee might find more funds for the mass transit parts of the bill that would be eliminated.





Sen. Dukes

Responds that they have increased the identification card fee in order to fund the Senior and Disabled transit program. Reminds the members that there are technical problems with the bill that she assumes will be fixed.





Sen. George

Asks if the revenue impact from HB 2041 A has changed at all.





Dick Yates

Responds affirmatively.


Discussion follows.





Sen. Deckert

Asks for information on the sequestration portion of the bill.






Discusses the process of determining estimated revenues from the income tax capture and explains that they donít view that income as new revenue.





Sen. Nelson

Asks if the estimates are more than the $3 million.






Responds that it wonít be initially because it takes a long time for ODOT to begin the process of hiring people.


Discussion follows.





Sen. Metsger

Asks what the estimate would be five years into the bill.






Responds that his estimate is $12.6 and then more in the later years.


Discussion follows.





Randy Tucker

Discusses the HB 2041-B21 amendments, which requires projects selected for financing under the package to conform to and implement Oregonís highway plan and state land use plan. States that this should apply to all future transportation packages as well. Explains the HB 2041-B20 amendments, which clarifies the intent of language already in the bill that prioritizes the projects that are ready for construction to ensure that transportation dollars created by the bill are spent on projects that have done their homework and are ready to build. Explains the HB 2041-B19 amendments, which deletes the section prohibiting modification of state highways that are identified freight routes in any way that would reduce the vehicle carrying capacity of the road. States that the section could jeopardize efforts to promote economic development by revitalizing downtowns and improving efforts for mass transit, bicycles, and pedestrians in cities. Discusses added exemption possibility and why it is not adequate.





Sen. Deckert

Asks if Tucker was involved in the workgroup.






Responds that he was invited to one meeting in the House where they discussed some of these issues.





Sen. Deckert

Asks about the process for cities to get waivers.






Responds that cities have to apply for a waiver if a project reduces the freight capacity of the road.


Discussion follows.





Sen. Starr

States that he will oppose the amendments because the freight mobility around the state is an issue of statewide concern and the section accommodates local government concerns about it.





Matt Blevins

Testifies in support of the bill but expresses concern with the tax credit for diesel engines because all engines that are going to be produced are going to clean engines and there is no reason to offer a credit for something that is going to be required in the future. Suggests to at least require truck drivers to retire old engines once they have purchased new ones.





Jim Torrey

Testifies in support of the original bill and asks that they take into consideration the need for local governments to take advantage of these funds. States that he believes local government was given the opportunity to work with the Department of Transportation on projects. Expresses concern with the amendment that says the projects have to be ready.


Discussion follows.





Sen. Metsger

Expresses concerns about downtown routes but states that he has been pleased with the Department of Transportation in allowing cities to control roads.






Clarifies that he was not making a nefarious statement about ODOT or proposing the amendment based on actions in the past.





Sen. Deckert

Asks who is proposing the ĖB23 and ĖB24 amendments.





Sen. Starr

Replies that the ĖB23 appear to be the Ways and Means Subcommittee amendment and the ĖB24 look to be identical to the ĖB19 amendments.


Discussion follows.





Laura Pryor

Testifies in support of the original bill because everyone has worked hard to come up with a compromise. States that it has been 12 years since cities and counties have been given funds to improve bridges and roads and they are in trouble.





Darrell Fuller

Testifies that any bill of this magnitude is going to have problems and that he is concerned that pulling one or two sections of the bill out would imperil the process of moving a transportation package.





Sen. Deckert

Asks what happens if the Senate does not have the votes to pass the bill.






Responds that he believes they do have the votes and that if they donít they end up coming back and rewrite it.






States that she knows that if a change is made it could have a negative impact on cities and counties, but they are still there at the table.





Roger Martin

Testifies that mass transit needs the $2 million in the bill for bus replacements. Corrects errors made by the Ways and Means Subcommittee. Points out that in 1979, the light rail program sequestered income tax revenue. Discusses the funding for bus replacement. States that the only way this bill will be successful is if it remains in its original form.





Sen. Deckert

Points out that when he asked the Subcommittee if bus replacement was funded with flexible federal funds they all nodded.






Responds that he hopes that is true but that he doesnít believe they can find the flexible funds to do that.





Sen. Metsger

Asks for a reaction to the statement that this bill was done in the dead of night.






Responds that this has been an open process and that members of the Ways and Means committee could have





Sen. Nelson

States that in his caucus the information and problems with the bill were openly discussed.






Responds that there were a lot of people that were frustrated at how long the bill took to get over to the Senate because members were given time to thoroughly review the bill.


Discussion follows.





Mike Salsgiver

States that this is one of the most important bills of the session and agrees that this is not the first time that sequestration has been used. Urges passage of the bill with no amendments.





John Watt

Testifies in support of the bill in its existing form and states that he has always been informed about what has been going on with the bill.





John Ledger

Offers strong support for this bill because businesses are being financially hurt by having to drive long distances to avoid damaged roads. Expresses concern that taking anything out of the bill will prevent its passage.





Lynn Lundquist

Offers support for the package and states that the real issue is not that $4million is being taken from the General Fund but rather what the money is going to.





Sen. Starr

Points out that the diesel engine tax credit has a requirement that the engines be purchased in Oregon and asks how that would impact Freightliner and other businesses that are truck engine dealers.






Responds that it would constitute a lot of work because engine building is a skilled high paying job. States that this tax credit would help them a lot and that tax credits work to entice companies to relocate.






Responds that if they are giving incentives to buying new merchandise, that merchandise has to be painted, have new tires, and those people will also benefit.






Responds that tax credits are used to incent sectors of the economy to do things that are in the interest of public good or economy and to offset costs that the government would have to pick up. States that this tax credit has a multiple benefit by securing the use of engines that are good for the environment and by stimulating a sector of the economy that needs it.





Sen. Deckert

Asks about the argument that this will not induce anyone to buy a new engine because they will buy one if they need it and not buy one if they donít.






Replies that people he has talked to in the industry have said that this is a credit they will use.






Responds that a credit would speed up the process of changing engines.


Discussion follows.





Mary Botkin

Testifies on behalf of Ralph Groener of the importance of the bill and urges its passage in its original form.





Sen. Starr

States that getting this bill to where it is has been a long process and has been full of compromises. States that the hit to the General Fund is reasonable when considering the investment in creating jobs and that he hopes that the bill will go through as planned. Discusses technical changes that need to be made.





Sen. Metsger

Asks for the future plans on the bills.





Sen. Deckert

Replies that they will assess where they are at and that it is scheduled again on Monday.





Sen. Metsger

States that this bill demonstrates why there hasnít been a transportation package in over a decade and that it is a compromise by all parties involved.





Sen. Deckert

Adjourns meeting at 11:37 am.




Tape Log Submitted by,




Tara Lantz, Committee Assistant


Exhibit Summary:

  1. HB 2041 B, Randall Edwards, Written Testimony, 3pp.
  2. HB 2041 B, Randy Tucker, Proposed HB 2041-B21 Amendments, 1p.
  3. HB 2041 B, Randy Tucker, Proposed HB 2041-B20 Amendments, 1p.
  4. HB 2041 B, Randy Tucker, Proposed HB 2041-B19 Amendments, 1p.
  5. HB 2041 B, Sen. Morse, Proposed HB 2041-B23 Amendments, 1p.
  6. HB 2041 B, Randy Tucker, Proposed HB 2041-B24 Amendments, 1p.
  7. HB 2041 B, Sen. Metsger, Proposed HB 2041-B22 Amendments, 1p.