SENATE COMMITTEE ON BUSINESS AND ECONOMIC DEVELOPMENT

 

 

May 26, 2005                                                                                                          Hearing Room B

1:00 P.M.                                                                                                                     Tapes 74 – 75

 

MEMBERS PRESENT:         Sen. Rick Metsger, Chair

Sen. Bruce Starr, Vice-Chair

Sen. Jason Atkinson

Sen. Laurie Monnes Anderson

 

MEMBER EXCUSED:          Sen. Ryan Deckert

 

GUEST MEMBER:               Sen. Vicki Walker

 

STAFF PRESENT:                 Theresa Van Winkle, Committee Administrator

James Goulding, Committee Assistant

 

MEASURES/ISSUES HEARD:

                                                HB 2604A – Work Session

                                                SB 955 – Work Session

                                                HB 2071 – Public Hearing and Work Session

                                                HB 2200 – Public Hearing and Work Session

                                                HB 2579 – Public Hearing and Work Session

                                                HB 2069 – Public Hearing and Work Session

                                                SB 408 – Work Session

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 74, A

003

Chair Metsger

Calls the meeting to order at 1:08 p.m. Opens a work session on        HB 2604A.

HB 2604A – WORK SESSION

012

Chair Metsger

Mentions the -A6 amendments (EXHIBIT A).

021

Dave Heynderickx

Acting Legislative Counsel. Explains the provisions of the measure.  Talks about the differences in standards between “negligence” and “gross negligence”.

051

Heynderickx

Explains the changes made in the –A6 amendments.

078

Scott Taylor

Oregon Real Estate Commissioner. Concurs with Mr. Heynderickx’s analysis of the –A6 amendments and states support for them.

085

Jana Jarvis

Oregon Association of Realtors. States support for the –A6 amendments.

090

Sen. B. Starr

MOTION:  Moves to ADOPT HB 2604A-A6 amendments dated 5/18/05.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

092

Sen. B. Starr

MOTION:  Moves HB 2604A to the floor with a DO PASS AS AMENDED recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. B. STARR will lead discussion on the floor.

096

Chair Metsger

Closes the work session on HB 2604A. Opens a work session on      SB 955.

SB 955 – WORK SESSION

091

Theresa Van Winkle

Committee Administrator. Notes the -5 amendment (EXHIBIT B) to SB 955.

098

Brian DeMarco

Oregon Real Estate Agency. Notes the original objections to the measure. Talks about the compromise reached in the -5 amendments.

110

Barry Pack

Committee for the Protection of Condominium Owners and Builders. Explains the changes made by the -5 amendments.

125

Sen. B. Starr

Asks who was represented in the negotiations that resulted in the amendments.

129

Pack

Lists the parties involved in the compromise discussion.

135

Sen. B. Starr

MOTION:  Moves to ADOPT SB 955-5 amendments dated 5/24/05.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

140

Sen. B. Starr

MOTION:  Moves SB 955 to the floor with a DO PASS AS AMENDED recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. B. STARR will lead discussion on the floor.

147

Chair Metsger

Closes the work session on SB 955. Opens a public hearing on          HB 2071.

HB 2071 – PUBLIC HEARING

150

Teresa Van Winkle

Committee Administrator. Introduces HB 2071.

155

Bill Boyd

Dispute Resolution Manager, Construction Contractors Board. Submits and summarizes prepared testimony in support of HB 2071 (EXHIBIT C).

180

Chair Metsger

Closes the public hearing and opens a work session on HB 2071.

HB 2071 – WORK SESSION

180

Sen. B. Starr

MOTION:  Moves HB 2071 to the floor with a DO PASS recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. MONNES ANDERSON will lead discussion on the floor.

190

Chair Metsger

Closes the work session on HB 2071. Opens a public hearing on       HB 2200.

HB 2200 – PUBLIC HEARING

200

Bill Boyd

Dispute Resolution Manager, Construction Contractors Board (CCB). Submits and summarizes prepared testimony in support of HB 2071 (EXHIBIT D).

255

Sen. B. Starr

Asks what administrative issues led to the move away from four-year licenses.

261

Kristie Patton

Licensing Section Manager, CCB. Explains the licensing process and the associated administrative challenges.

273

Sen. B. Starr

Asks how many contractors are administered by CCB.

277

Patton

Answers approximately 40,000.

279

Sen. B. Starr

Wonders how many contractors per month change their business status.

280

Patton

Answers that it is approximately 60 per month.

287

Sen. B. Starr

Remarks that the number of contractors affected is small and wonders if it is necessary to change the law to accommodate them.

303

Boyd

Explains the hope that the bill will make business operations move more smoothly. Notes that expenses would be reduced for the CCB.

316

Sen. B. Starr

Asks what licensing options contractors have.

319

Patton

Answers that there is a mandatory two-year license and an optional four-year license.

325

Chair Metsger

Closes the public hearing and opens a work session on HB 2200.

HB 2200 – WORK SESSION

328

Sen. B. Starr

MOTION:  Moves HB 2200 to the floor with a DO PASS recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. METSGER will lead discussion on the floor.

335

Chair Metsger

Closes the work session on HB 2200. Opens a public hearing on       HB 2579.

HB 2579 – PUBLIC HEARING

340

Don Miner

Executive Director, Oregon Manufactured Housing Association. Submits and summarizes prepared testimony in favor of HB 2579 (EXHIBIT E).

360

Joan Fraser

Building Codes Division, Department of Consumer and Business Services. Testifies in support of HB 2579. Notes the similar legislation HB 2389.

375

Chair Metsger

Closes the public hearing and opens a work session on HB 2579.

 

HB 2579 – WORK SESSION

380

Sen. B. Starr

MOTION:  Moves HB 2579 to the floor with a DO PASS recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. B. STARR will lead discussion on the floor.

390

Chair Metsger

Closes the work session on HB 2579. Opens a public hearing on       HB 2069.

HB 2069 – PUBLIC HEARING

410

Michael Snyder

Administrator, Landscape Contractors Board (LCB). Testifies in support of HB 2069.

TAPE 75, A

005

Snyder

Submits a packet of testimony and information (EXHIBIT F).

045

Bill Cross

Oregon Landscape Contractors Association. Submits written testimony in favor of HB 2069 (EXHIBIT G).

085

Chair Metsger

Notes the difference between the proposed -A2 amendments (EXHIBIT H), -A3 amendments (EXHIBIT I),and -A4 amendments (EXHIBIT J).

085

Sen. Monnes Anderson

Asks about fees associated with continuing education for landscape contractors.

090

Snyder

Replies that no fees for continuing education would be charged by the LCB because it is part of the licensing fees.

096

Sen. Monnes Anderson

Asks if continuing education issues could be reported online.

097

Snyder

Answers yes.

098

Sen. Atkinson

Asks about the composition of the LCB.

101

Snyder

States that the board is made up of five industry-related members and two public members.

103

Sen. Atkinson

Asks for a further clarification of the composition of the LCB industry-related members.

106

Snyder

Offers further clarification of the industry-related members of the LCB.

110

Sen. Atkinson

Expresses skepticism about education credits. Feels that industry boards can present barriers-to-entry to an industry. Cites a similar issue faced by the used car industry in the past.

125

Snyder

Explains that the initial landscape contractor examination is the first standard of competency and the continuing education would enhance the knowledge of landscape contractors. Expresses the desire to have the examination certified by the national organization of accreditation certification.

154

Sen. B. Starr

Asks for a comparison of the state requirements in HB 2069 to the requirements for LCB licenses.

163

Snyder

Highlights the differences between the two.

193

Brian McDermott

Legislative Assistant, Office of Senator Charles Starr. Explains the -A2 amendments, -A3 amendments,and -A4 amendments. Presents the written testimony of Rep. Kim Thatcher (EXHIBIT K) and Rep. Linda Flores (EXHIBIT L) regarding HB 2069.

265

Wes Butler

Silverton Licensed Landscaper. Testifies in regard to the importance to the amendments of the measure. Observes the heavy regulations on the landscape contracting industry in Oregon.

299

Mike Schrock

Business Contractor. Expresses concerns over additional regulations regarding continuing education and standards of professional conduct.

330

Schrock

Elaborates on the subjective nature of the landscaping industry.

369

Chair Metsger

Asks Mr. Cross about moving forward without sections 2 and 3 of the bill.

380

Cross

Asks for additional time to work out a compromise on the continuing education portion of the bill.

410

Chair Metsger

Explains that the bill can be passed with the -A4 amendments or held over until the next meeting to work out a compromise.

TAPE 74, B

013

Sen. Monnes Anderson

Addresses the importance of the professional conduct portion of the bill.

023

Sen. B. Starr

Offers there are elements of the bill that are very positive that should be passed. 

035

Snyder

States support for the bill.

The following material is submitted for the record without public testimony:

 

Patrick Griffiths

Water Resources Coordinator, City of Bend. Submits written testimony and information in support of HB 2069 (EXHIBIT P).

040

Chair Metsger

Notes the concerns expressed by Mr. Cross. Closes the public hearing and opens a work session on HB 2069.

HB 2069 – PUBLIC HEARING

042

Sen. B. Starr

MOTION:  Moves to ADOPT HB 2069-A4 amendments dated 5/25/05.

045

Sen. Monnes Anderson

Argues that the consumer protection provisions should remain in the bill.

 

 

VOTE:  3-1-1

AYE:               3 - Atkinson, Starr B., Metsger

NAY:               1 - Monnes Anderson

EXCUSED:     1 - Deckert

 

Chair Metsger

The motion CARRIES.

055

Sen. B. Starr

MOTION:  Moves HB 2069 to the floor with a DO PASS AS AMENDED recommendation.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Deckert

 

Chair Metsger

Hearing no objection, declares the motion CARRIED.

SEN. B. STARR will lead discussion on the floor.

060

Chair Metsger

Closes the work session on HB 2069. Opens a work session on SB 408.

SB 408 – WORK SESSION

065

Chair Metsger

Introduces SB 408.

075

Dexter Johnson

Office of Legislative Counsel. Explains the –A7 amendments (EXHIBIT M).

100

Johnson

Explains the provisions for rate filing of a utility.

117

Chair Metsger

Asks for a clarification of the tax reporting provisions.

119

Johnson

Offers clarification of tax reporting. Continues his description of the amendments.

150

Johnson

Discusses deferred taxes in relation to depreciation.

175

Johnson

Details section 5 of the amendments.

186

Sen. Vicki Walker

Senate District 7. Asks if there is precedent for the automatic adjustment clause.

190

Johnson

Answers that there is a precedent and clarifies the automatic adjustment clause.

199

Mark Nelson

Industrial Customer of Northwest Utilities. Testifies in support of SB 408 and the –A7 amendments.

237

Jeff Bissonette

Citizens Utility Board (CUB). Testifies in support of SB 408.

254

Sen. B. Starr

Asks how the measure will affect rate stability.

274

Bissonette

Observes the importance of rate stability and rate adjustments. Notes that the bill includes provisions that allow tax issues to be examined.

301

Nelson

Concurs with Mr. Bissonette’s comments. Talks about rate changes over time. 

325

Dan Meek

Attorney, Utility Reform Project. Testifies in support of SB 408. Describes problems with the bill related to the charges to ratepayers and the elimination of tax practices. States support for the –A7 amendments.

360

Meek

Proposes that deadlines for PUC review of rates and operations be included in the measure.

390

Meek

Objects to the limitation of the definition of “tax” in the measure. Argues that the definition should be further refined.

412

Pamela Lesh

Vice President for Regulatory Affairs, Portland General Electric (PGE). Notes she came prepared to address the –A6 amendments (EXHIBIT N). Expresses uncertainty about the –A7 amendments and the one-way adjustment clause.

TAPE 75, B

005

Lesh

Admits some concerns over the –A7 amendments. Submits and summarizes Tax True-up examples (EXHIBIT O)

033

Sen. Monnes Anderson

Asks for a clarification of the figures in Ms. Lesh’s examples.

040

Lesh

Explains Oregon’s Minimum Corporate Tax and offers a clarification of the figures. Continues describing the scenario in which PGE would receive more revenue than anticipated.

080

Lesh

Provides additional rate-setting scenarios.

120

Scott Bolton

PacificCorp. Testifies that SB 408 will hurt ratepayers and utilities. Explains regulations and taxes.

136

Chair Metsger

Clarifies attributable taxes related to utilities and affiliated groups.

143

Bolton

Asks for a clarification of the changes in the amendments.

149

Chair Metsger

Clarifies the changes in the –A7 amendments.

154

Lesh

Asks if losses would be impacted as well.

158

Chair Metsger

Answers that only utilities would be affected.

163

Bolton

Argues that the tax responsibility provisions in the measure are unclear.

168

Chair Metsger

Offers further clarification of the provision.

170

Gary Bauer

NW Natural. Describes the rate-setting process and tax liability.

200

Bauer

Discusses the shifts in tax liabilities and costs. Notes an issue of language related to deferred taxes paid and charges to ratepayers.

230

Chair Metsger

Offers clarification of the bill language.

240

Sen. B. Starr

Asks about the underlying issue of fairness regarding utilities’ ability to add taxes into their rates even if they don’t pay taxes. 

249

Lesh

Explains the setting of utility rates and taxes.

280

Melinda Davison

Industrial Customers of Northwest Utilities. Notes that the examples Ms. Lesh provided are not considering the “Enron impact” related to Enron not paying the appropriate taxes.

314

Sen. Monnes Anderson

Asks if the amount of taxes would be so significant as to keep businesses from operating in Oregon.

320

Davison

Replies that SB 408 will not create a business disincentive, but will resolve the tax issues.

336

Chair Metsger

States that Pete Shepherd was involved in the discussions on the issue and asks if the Attorney General has taken a position on the issue.

345

Pete Shepherd

Deputy Attorney General. States that Attorney General Hardy Myers would like the law to connect the actual taxes received by governments to the amounts that utilities are recovering as that element of their cost. Notes the constitutional limitations of the legislature in addressing the issue.

378

Julie Brandis

Associated Oregon Industries (AOI). Notes AOI’s previous neutral position on the measure. Concurs with Sen. Starr’s observation on fairness on tax collection and payments. 

415

Chair Metsger

Closes the work session on SB 408. Adjourns the meeting at 3:02 p.m.

 

 

EXHIBIT SUMMARY

 

  1. HB 2604A, -A4 amendments, staff, 1 p
  2. SB 955, -5 amendments, staff, 14 pp
  3. HB 2071, written testimony, Bill Boyd, 6 pp
  4. HB 2200, written testimony, Bill Boyd, 35 pp
  5. HB 2579, written testimony, Don Miner, 1 p
  6. HB 2069, written testimony and information, Michael Snyder, 31 pp
  7. HB 2069, written testimony, Bill Cross, 2 pp
  8. HB 2069, -A2 amendments, staff, 1 p
  9. HB 2069, -A3 amendments, staff, 1 p
  10. HB 2069, -A4 amendments, staff, 1 p
  11. HB 2069, written testimony, Rep. Kim Thatcher, 1 p
  12. HB 2069, written testimony, Rep. Linda Flores, 1 p
  13. SB 408, -A7 amendments, staff, 7 pp
  14. SB 408, -A6 amendments, staff, 4 pp
  15. SB 408, Tax True-up Examples, Pamela Lesh, 4 pp
  16. HB 2069, written testimony and information, Patrick Griffiths, 7 pp