PUBLIC HEARING

HB 2514, 2787, 3348

WORK SESSION

HB 3358, 2511, 2234, 2450, 2338

TAPES 133-134 A-B, 135 A

002

Chair Butler

Calls meeting to order at 1:17 p.m. Discusses committee business.

OPENS PUBLIC HEARING FOR HOUSE BILL 2514

025

Lizbeth Martin-Mahar

Gives summary of HB 2514 (Exhibit 1). This bill authorizes the Office of Rural Health to certify psychologists with rural practices as eligible for the rural medical practice income tax credit.

050

Chair Butler

General comments on current legislative session bills pertaining to psychologists. Comments on the few psychologists and psychiatrists who practice in rural eastern Oregon. Asks Martin-Mahar how many psychologists are practicing in rural areas.

072

Martin-Mahar

Responds that she spoke with the Office of Rural Health which will provide the data at a later date.

080

Damiana  Merryweather

In response to the number of practicing psychologists in rural areas, she comments that as of March there were 126 psychologists statewide who would qualify for this credit. Adds that the Office of Rural Health could limit the number of eligible psychologists to only those who practice in “frontier” counties.

096

Martin-Mahar

Adds that the bill does not narrow the credit to frontier counties.

100

Rep. Boquist

Asks that if passage of the bill allows the Rural Health Board to limit the eligibility rules.

101

Merryweather

Responds that there is latitude in the statute that allows the Rural Health Board to rule on limitations within the parameters of the bill.

109

Chair Butler

Asks for information from Merryweather regarding limiting the scope of this bill to frontier counties only.

111

Rep. Boquist

Discusses the crisis of mental health treatment available for veterans in rural areas.

125

Rep. Hass

Asks why the implementation of this bill is put out to 2009.

129

Merryweather

Responds that Chair Butler, the sponsor of the bill, said that putting this out to 2009 would ease the financial impact. It would also be a tool to attract upcoming graduates of programs to entice them to move to rural communities.

137

Rep. Hass

Comments that he would be more supportive of tax credit bills if they were implemented now.

147

Rep. Boquist

Expresses concern about imminent mental health issues with returning veterans, and he supports earlier implementation.

150

Rep. Komp

Supports an earlier implementation date. Comments that rural schools do not have the mental health professionals needed.

161

Chair Butler

Comments that this credit is intended to be an attraction to undergraduates to go on to graduate degrees.

171

Merryweather

Comments that she supports an earlier implementation date.

CLOSES PUBLIC HEARING FOR HOUSE BILL 2514

OPENS PUBLIC HEARING FOR HOUSE BILL 2787

178

Martin-Mahar

Gives overview of HB 2787 (Exhibit 2). This bill adds emergency medical technicians (EMTs) to the list of eligible rural health practitioners in rural areas. Implementation date is 01/01/06.

195

Rep. Boquist

Asks about a previous bill that was heard this session in the Revenue Committee that pertained to a tax credit for EMTs.

200

Martin-Mahar

Responds that a public hearing was held about an above-the-line deduction for EMT expenses. Refers to the amendment HB 2787-1 (Exhibit 3). The amendment adds pharmacists to the list of eligible rural health care practitioners.

CLOSES PUBLIC HEARING FOR HOUSE BILL 2787

OPENS PUBLIC HEARING FOR HOUSE BILL 3348

224

Martin-Mahar

Gives overview of HB 3348 (Exhibit 4). The bill increases the tax credit to a maximum of $10,000 for physicians who practice in rural areas.  Refers to the handout: 2003 Filers Claiming the Rural Medical Credit (Exhibit 5) and the revenue impact statement (Exhibit 6). If HB 3348 passes, it would increase the revenue impacts on the other bills [HB 2514 and HB 2787].

262

Rep. Berger

Asks when the rural health tax credit was implemented and is there information or anecdotal information regarding how the program is working.

268

Martin-Mahar

Responds that the credit was enacted in 1989. Does not have anecdotal information.

284

Rep. Galizio

Discusses anecdotal information about his wife who is a rural health care provider. The loan reimbursement at the federal level was an incentive. Adds that neither he nor his accountant was aware of the tax credit.

CLOSES PUBLIC HEARING FOR HOUSE BILL 3348

OPENS WORK SESSION FOR HOUSE BILL 2338

325

Rep. Jerry  Krummel

Testifies in support of HB 2338 and discusses amendment HB 2338-1 (Exhibit 7).  The bill is for high-growth school districts and creates a high-growth grant. The amendment adds a section pertaining to a maximum amount to be distributed as high-growth grants. The other change pertains to the funding formula in the bill. The change is based on the actual number of students who attend.

405

Chair Butler

Asks Meyer how many schools are impacted with the ADM growth.

413

Steve Meyer

Responds that the revisions in the amendments would amount to $800-$900 per student and a total amount a little under $5 M.

438

Rep. Krummel

Agrees with Meyer’s figures based on where district growth has occurred.

TAPE 134, SIDE A

020

Rep. Krummel

Discussion with Chair Butler and Steve Meyer about impacts of high-growth districts.

040

Meyer

Adds that the components in the amendment regarding a three percent growth rate over the previous three years and an additional 90 students over the previous fiscal year means those districts with no less than 3,000 students would qualify.

042

Rep. Krummel

Clarifies that the extra $1000 would apply only to the number of additional students over 90 during the previous year.

049

Rep. Hass

Comments on student population growth in the Beaverton school district.

050

Meyer

Adds that it would mean a reduction in the General Purpose Grant to compensate for the High Growth Grant.

057

Rep. Boquist

Asks Meyer how many districts could move into the growth category over the next year.

064

Meyer

Responds, the number of districts currently estimated [9-12] would remain the same for 2006-2007.   

072

Rep. Krummel

Adds that the maximum $10 M per biennium is just about right for a 2-3 year period.

077

Rep. Berger

MOTION: MOVES THE ADOPTION OF THE HB 2338-1 AMENDMENT.

089

Rep. Komp

Expresses concerns about the bill. Comments that average daily membership (ADM) does not relate to the actual number of children in the classroom. The figures for the School Funding Formula do not explain how many students are in the classroom or how many classrooms are needed.  It is a major flaw in the statutes because ADM is used. Comments that she will have a “tough time” supporting any bill that is connected to the ADM formula.

116

Rep. Esquivel

Discussion with Rep. Esquivel about daily attendance and the ADM reporting of the students.

124

Rep. Hass

Agrees with Rep. Komp’s concern about daily attendance figures. However, this bill doesn’t deal with the attendance concern.

129

Rep. Riley

Expresses concern about the bill as amended because he does not know how many schools and costs are involved. Would prefer to wait for more information.

140

Meyer

Will provide information for next hearing date for HB 2338.

151

Rep. Hass

Suggests adopting the amendment and rescinding the referral to Ways and Means until more information is received.

155

Chair Butler

Asks for roll-call vote.

164

Chair Butler

ORDER: THE MOTION PASSES TO ADOPT THE HB 2338-1 AMENDMENT. VOTE 6-2-1. VOTING AYE: BOQUIST, GALIZIO, RILEY, BERGER, HASS, BUTLER. VOTING NO: ESQUIVEL, KOMP. EXCUSED: OLSON.

CLOSES WORK SESSION FOR HOUSE BILL 2338

OPENS WORK SESSION FOR HOUSE BILL 2450

185

Meyer

Gives overview of HB 2450 (Exhibit 8). This bill pertains to the high-cost disability grant and the small high school supplement fund. This bill repeals the sunset date for both grants. Refers to the revenue impact statement (Exhibit 9). Discusses amendment HB 2450-2 (Exhibit 10). The only difference between the bill and the amendment is the threshold for high-cost disability students. Refers to the revenue impact statement (Exhibit 11).  Discusses amendment HB 2450-5 (Exhibit 12) and refers to the revenue impact statement (Exhibit 13).  Refers to the table handouts, one for the bill and one for the HB 2450-2 amendment. (Exhibits 14 and 15).

280

Rep. Berger

Discussion with Meyer about the mechanics of the HB 2450-5 amendment pertaining to the high-cost disability grant.

327

Rep. Hass

Asks Meyer about districts in the tables that have zero’s in the high cost column but are apparently larger districts.

335

Meyer

Responds that they probably have a high-cost student that meets the criteria, but they may have not filed an application. However, they must report the student to the Dept. of Education.

368

Rep. Boquist

Discusses amendment HB 2450-3 (Exhibit 16). The amendment increases the grant amount from $12 M to $18 M.

374

Chair Butler

Discussion with Meyer regarding the amendments. Asks if there is a provision for excess funds outside of the School Funding Formula.

376

Meyer

Responds that any excess would stay in the School Funding Formula and go into General Purpose Fund.

390

Rep. Boquist

Discussion with Chair Butler and Meyer about the HB 2450-3 amendment.

400

Rep. Riley

Asks Meyer if he agrees with Rep. Boquist’s figures.

401

Meyer

Responds that he agrees with Rep. Boquist. Adds that the data is based on 2003-04 figures, and the numbers will increase slightly for

2005-06. Discussion with Chair Butler.

TAPE 133, SIDE B  

017

Rep. Boquist

Comments that the debate is, should the threshold be increased, or should the whole program be funded. His amendment just moves the amount up to $18 M to fund the entire program.

024

Rep. Hass

Comments that putting more money into special education takes away money from another program. Agrees that more money should be added to fully fund this program, but if it is done within the School Funding Formula, we are adding more money at the expense of other programs.

035

Chair Butler

Asks Rep. Komp how the threshold increase affects her school. Adds general comments about funding situations in eastern Oregon.

052

Rep. Komp

Discusses threshold amounts stated in the amendments. Prefers the HB 2450-2 amendment.

064

Rep. Boquist

Comments about the impact of high-cost disability students in rural districts like his.

080

John Marshall

Comments that the high-cost disabilities grant is a high-cost insurance pool because every school district makes a premium payment of $18 per weighted student. The issue is the deductible amount. The HB 2450-2 amendment increases the deductible without changing the premium. HB 2450-3 amendment will increase premium for every district and leave the deductible where it is, increasing the amount of the reimbursement. Asks what is the appropriate level of premium, and how big the deductible should be. Supports HB 2450-2 amendment which leaves the premium the same, the deductible is increased, and the reimbursement would be 100%.

117

Laurie Wimmer Whelan

Supports the HB 2450-2 amendment, and agrees with Marshall’s analogy to health care insurance pooling.

123

Rep. Berger

Comments that there are decision points about this issue knowing that all parties were not going to be satisfied. Likes the insurance analogy from Mr. Marshall. The bill is good and works as it was envisioned, knowing that it doesn’t serve all the needs. Would support the HB 2450-2 amendment and is not comfortable with raising the premium as the HB 2450-3 amendment would do.

156

Rep. Boquist

Agrees with the OEA that the original bill is OK and also supports the HB 2450-3 amendment.

177

Rep. Komp

MOTION: MOVES THE ADOPTION OF THE HB 2450-2 AMENDMENT.

180

Chair Butler

Asks for roll call-vote.

194

Chair Butler

ORDER: THE MOTION PASSES TO ADOPT THE HB 2450-2 AMENDMENT. VOTE: 6-2-1. VOTING AYE: ESQUIVEL, GALIZIO, KOMP, RILEY, HASS, BUTLER. VOTING NO: BOQUIST, BERGER. EXCUSED: OLSON.

200

Brian Reeder

Testifies on amendment HB 2450-5. The amendment is a correction to a language drafting error. Explains the changes proposed.

219

Chair Butler

Expresses concern about the amount of paperwork involved for the districts. It seems that the amendment requires a new accounting system to track the information.

220

Reeder

Responds that it does not create additional paperwork for school districts or the Dept. of Education because the data is captured now.

232

Rep. Komp

MOTION: MOVES THE ADOPTION OF THE HB 2450-5 AMENDMENT.

235

Meyer

Comments that the HB 2450-5 amendment does have the $30,000 built into it, and the HB 2450-5 amendment just adds the expenditure language.

241

Rep. Hass

Asks Meyer if he agrees with the Chair about no additional accounting required to implement the HB 2450-5 amendment.

243

Meyer

Responds that he agrees with Reeder that the Dept. of Education already collects the data.

251

Marshall

Expresses concern about the 2450-5 amendment. A distribution formula is currently in place. Discusses the consequences of the amendment on school districts.  

265

Rep. Komp

Asks Marshall why the state would not want to know where dollars are being directed.

269

Marshall

Discusses the procedure in place for a school district to request a waiver to exceed the spending cap. Regarding the information that the Dept. of Education needs to allocate additional funds, he believes the Dept. already has the authority to request the information. He  doesn’t believe statutory language is needed to dictate a spending formula when a distribution formula already exists. Discusses the costs to districts to administer Individual Education Plans (IEPs) for special-needs students.

350

Rep. Komp

General comments on the amendment and the issue of accountability.

372

Reeder

Discusses the HB 2450-5 amendment. The Dept. would not support the legislature telling school districts how to spend their money.  HB 2450 “does that in a very narrow circumstance”. Discussion with Chair Butler about other district grants that the legislature oversees.

TAPE 134, SIDE B

005

Wimmer Whelan

The OEA supports transparency. Doesn’t think the HB 2450-5 amendment does that. Having flexibility in managing money at the local level is very important to the OEA.

020

Rep. Berger

Comments that she does not support the HB 2450-5 amendment, but she does support the original bill as written.

Rep. Komp

By implied consent, withdraws motion to adopt HB 2450-5 amendment.

028

Chair Butler

States that Rep. Galizio makes a motion. MOTION: MOVES THE ADOPTION OF THE HB 2450-5 AMENDMENT.

029

Chair Butler

Asks for roll-call vote.

035

Chair Butler

ORDER: MOTION FAILS 2-6-1. VOTING AYE: ESQUIVEL, KOMP. VOTING NO: BOQUIST, GALIZIO, RILEY, BERGER, HASS, BUTLER. EXCUSED: OLSON.

036

Chair Butler

States that Rep. Berger makes a motion. MOTION: MOVES HB 2450 AS AMENDED TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

043

Rep. Berger

Comments that she will now support HB 2450-2 amendment because her colleagues have supported it.

047

Chair Butler

Clarifies that Rep. Berger’s motion includes a subsequent referral to the Joint Ways and Means Committee.

051

Rep. Berger

Restates motion. MOTION: MOVES HB 2450 AS AMENDED TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION AND BE REFERRED TO THE JOINT WAYS AND MEANS COMMITTEE.

055

Chair Butler

Calls AT EASE at 2:44 p.m.

064

Chair Butler

Calls meeting to order at 2:45 p.m.

076

Chair Butler

Asks for roll-call vote.

082

Chair Butler

ORDER: MOTION PASSES 6-1-2. VOTING AYE: GALIZIO, KOMP, RILEY, BERGER, HASS, BUTLER. VOTING NO: BOQUIST. EXCUSED: ESQUIVEL, OLSON.

CLOSES WORK SESSION FOR HOUSE BILL 2450

OPENS WORK SESSION FOR HOUSE BILL 3358

084

Martin-Mahar

Gives overview of HB 3358 (Exhibit 17) and refers to the HB 3358-1 amendment (see Exhibit 5 from 04/18/05). This bill creates a personal income tax credit for taxpayers who contribute to an individual development account (IDA) used for settlement, financing or other closing costs incurred in the purchase of a primary residence. Refers to revenue impact statement (Exhibit 18).

146

Chair Butler

Discussion with Martin-Mahar regarding the tax credit.

160

Rep. Galizio

Asks how people find out about IDAs

161

Martin-Mahar

The Housing Dept. gives information if people call. Lenders also provide a booklet, but information is mostly word-of-mouth referral.

174

Rep. Esquivel

Comments that IDAs are usually brought up at first-time homebuyers seminars.

192

Rep. Riley

Asks what is income level stated in the bill.

194

Martin-Mahar

Responds that an income level is not spelled out in bill, but she believes that it is 80% of median income.

202

Chair Butler

Discusses the HB 3358-1 amendment. Comments that it does not bind the legislature to appropriate anything (see Section 4, subparagraph 2).

211

Rep. Hass

Asks about the date 07/01/09 stated in the amendment.

213

Martin-Mahar

Explains that is the date that the future legislature must look at matching funds for IDAs. Does not have anything to do with the starting point of the tax credit. Adds that this amendment has not gone to fiscal for analysis.

232

Rep. Berger

Comments that she does not support the HB 3358-1 amendment because of the policy statement.

239

Rep. Hass

MOTION: MOVES HB 3358 TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

241

Rep. Hass

Agrees with Rep. Berger regarding the dates stated in the amendments.

256

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 8-0-1. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, KOMP, RILEY, BERGER, HASS, BUTLER. EXCUSED: OLSON

CLOSES WORK SESSION FOR HOUSE BILL 3358

OPENS WORK SESSION FOR HOUSE BILL 2511

271

Mary Ayala

Gives overview of amendment HB 2511-1. (Exhibits 19 and 20). Discusses amendment HB 2511-2 (Exhibits 21 and 22).

320

Chair Butler

Discusses the differences between the two amendments. The amendment language removes superfluous language from the bill.

358

Rep. Hass

Discusses work group meetings on this bill. Met with the sponsor of the bill, Rep. Gilman, and comments that Rep. Gilman is happy with the changes in the HB 2511-2 amendment.  

400

Rep. Hass

MOTION: MOVES THE ADOPTION OF THE HB 2511-2 AMENDMENT.

402

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, RILEY, BERGER, HASS, BUTLER. EXCUSED: KOMP, OLSON.

403

Chair Butler

States that Rep. Hass makes a motion. MOTION: MOVES HB 2511 AS AMENDED TO THE HOUSE FLOOR WITH A DO-PASS RECOMMENDATION.

411

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, RILEY, BERGER, HASS, BUTLER. EXCUSED: KOMP, OLSON.

CLOSES WORK SESSION FOR HOUSE BILL 2511

OPENS WORK SESSION FOR HOUSE BILL 2234 A

400

Ayala

Gives overview of HB 2234 A and HB 2234-1 amendment (Exhibits 23 and 24). The bill pertains to the number of electronic enterprise zones (e-commerce zones). Discusses the revenue impact (Exhibit 25). 

TAPE 135, SIDE A

030

Rep. Galizio

Asks about other bills that the Revenue Committee has heard  pertaining to enterprise zones.

045

Rep. Riley

Responds that this bill pertains to e-commerce zones, and another bill that pertains to enterprise zones will impact HB 2234 A.

060

Doris Penwell

Comments on the two bills currently pending regarding e-commerce zones and enterprise zones.

074

Rep. Galizio

Expresses concern about what constitutes an e-commerce zone because the criteria was not very strong.

090

Arthur Fish

Testifies about what constitutes an enterprise zone and submits a handout: HB 2234 A (Exhibit 26). To get an e-commerce designation, there are no special requirements. E-commerce businesses can use an enterprise zone designation for their property taxes. What e-commerce businesses receive a tax credit on  is defined as assets invested. If e-commerce is only an aspect of the business, the tax credit would vary depending on the extent of the e-commerce.

140

Rep. Riley

Discusses an e-commerce business scenario with Fish.

160

Fish

Comments on overseas connection with e-commerce jobs and job creation.

171

Rep. Hass

Asks who initiated the amendment.

172

Ayala

Responds that amendments were adopted in the Trade and Economic Development Committee and does not know who initiated the amendment.

179

Rep. Hass

MOTION: MOVES HB 2234 A TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

192

Rep. Boquist

Asks what the revenue impact is for the original bill without the amendment.

194

Ayala

Refers to the revenue impact for HB 2234 A (Exhibit 12 from 03/23/05).

229

Chair Butler

Calls AT EASE at 3:24 p.m.

230

Chair Butler

Calls meeting to order at 3:26 p.m. Restates that the motion before the committee is to move the bill without the HB 2234-4 amendment. Expresses concern about the motion.

249

Rep. Boquist

Clarifies revenue impact numbers with Ayala.

257

Chair Butler

Calls for roll-call vote.

269

Chair Butler

ORDER: MOTION FAILS 0-8-1. VOTING NO: BOQUIST, ESQUIVEL, GALIZIO, KOMP, RILEY, BERGER, HASS, BUTLER. EXCUSED: OLSON.

275

Chair Butler

MOTION: MOVES THE ADOPTION OF THE HB 2234 A-4 AMENDMENT.

280

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 8-0-1. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, KOMP, RILEY, BERGER, HASS, BUTLER. EXCUSED: OLSON.

285

Rep. Berger

MOTION: MOVES HB 2234 A AS AMENDED TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

292

Rep. Hass

Expresses concern that this bill isn’t ready to move yet because of the future implementation date [July 1, 2007].

306

Chair Butler

Responds that the state is not collecting taxes that are not here yet, and it is an ambiguous expenditure. Expresses concern that it is not a true loss to the general fund if taxes are not collected on non-existent businesses at present, but sees the need to set up the process when businesses do begin operation.

321

Chair Butler

Calls for roll-call vote.

335

Chair Butler

ORDER: MOTION PASSES 7-1-1. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, RILEY, BERGER, HASS, BUTLER. VOTING NO: GALIZIO. EXCUSED: OLSON.

CLOSES WORK SESSION FOR HOUSE BILL 2234

344

Chair Butler

Adjourns meeting at 3:20 p.m.

Tape Log Submitted by:

Reviewed by:

Kristi Bowman, Committee Assistant

Kim Taylor James, Committee Coordinator