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Major Jobs Bills Could Move
February legislative session is halfway done. Key job-creating bills hang in the balance.

In the weeks leading up to the February legislative session, we highlighted the issues we thought would help improve the lives of thousands of Oregonians and help revitalize communities around our great state through investment, job creation and income growth.

A 35-day session is an extremely short window to get things done in Salem, but each of these issues appeared to be both achievable and impactful.

For all of us, the urgency should be there to get these things done.

Why?

Because just last week, the state economist shared the following with legislators:

The third quarter personal income tax collections were down $35 million from the December 2011 forecast.
Oregon employment was down 2,051 jobs.
General Fund revenue is down $305 million from the final legislative estimate (roughly 8 months ago).
Only $120 million of the original $460 million the legislature set aside as a reserve is left to cover any additional shortfalls over the next 16 months.

For most Oregonians, the key to reversing these trends is pretty clear. The health of Oregon’s public finances depends solely on the creation of new jobs and higher incomes.

But job creation doesn’t happen by itself. It takes a concerted effort to attract investment and make Oregon a great place for business and job creation.

Will the legislature make that effort?

Here’s the current status of the job creation bills currently in the legislature:

Oregon’s Cycle of Boom & Bust

A compelling spending limit and state reserve fund proposal is emerging

Over the past 15 years, the legislature has spent, on average, 99% of all available tax revenues each year.

In fact, if the 2011 legislature had not had the wisdom to set aside 3.3% of its budget – about $450 million – then the 99% figure would be higher.

There are two undeniable facts at work in Oregon’s public finance system. First, our economy and tax system produce unstable boom and bust years. Second, the Oregon legislature will usually spend all available resources.

It leads to bad outcomes. When the legislature spends all available tax revenues during Oregon’s boom years, the legislature in turn must start cutting budgets and requiring more taxes and fees (eg. Measures 66 and 67) when revenue growth inevitably slows or even goes in reverse.

It’s a cycle that needs to stop. And a bill is getting traction in the Oregon legislature this month – Senate Joint Resolution 202 – that will set Oregon on a different path.

Here’s Oregon’s history of spending and why SJR 202 is so important:

For Job Creation Bills, Here’s Who YOU Talk to

These legislators need to hear from you on the importance of these job creation bills.

It’s show time.

The Oregon Legislature assembled yesterday for a five-week legislative session.

In preparation for this, two weeks ago we shared with you a list of issues that we believe will help spur needed job growth and improve the lives of thousands of Oregonians.

This week, we’re going to share that list of issues with you again, but this time we’re going to tell you who you need to talk to and why.

Of course, it’s vitally important that you email your own legislator in support of these job-creating bills. You can find your representative and senator and email them on the Oregon Prosperity Project website.

Here is the 2012 legislation that will move job growth in Oregon – and here are the legislators that need to hear from you.

12 Legislators Who Can Make a Positive Difference in 2012 Session

The Oregon legislature will convene for a short, five-week legislative session beginning next week. Several job-creating issues, many of which we talked about last week, are taking shape as we approach the session.

We believe the following 12 legislators will have a profound impact on many of our job-creating objectives for 2012.

It’s a bipartisan list – 6 Republicans and 6 Democrats – each with unique talents, viewpoints, areas of interest, and positions in the legislature that make them well suited this February to advance the Prosperity Project’s objectives of economic growth, job growth and income growth for Oregonians.

Here’s our list of legislator's who could make a big difference in 2012:

Our 2012 Agenda

The Oregon Legislature is coming back in February. These are things they can do to spur short term and long term job growth.

As the Oregon Legislature makes its way back to Salem for the February 2012 legislative session, it needs to tend to some unfinished business from last year, as well as take on some new issues, that will help spur job growth and improve the lives of thousands of Oregonians.

Yes, we are pleased that Oregon’s unemployment rate dropped below 9% for the first time in three years. Oregon added 2,400 new net jobs in December. This is good news. But the fact remains that over 175,000 Oregonians are out of work, and this doesn’t count those who’ve simply given up.

Here’s what the legislature can do NOW to continue to spur job and income growth for Oregonians.

Taxing Home Sales in Oregon?

New Ballot Measure Says “NO” to Double Taxation of Property – Sign the Petition!

Last week, we highlighted a number of potential 2012 government union backed ballot measures that we believe give Oregon voters the false choice of either raising taxes or cutting government services when focusing on growing our state economy is clearly the better option.

This week, we’d like to call attention to a proposed ballot measure we think would be helpful to the Oregon economy.

Already nearly 100,000 Oregonians have signed the petition to stop real estate transfer taxes in Oregon. Over 116,284 signatures will be needed to put this measure on the November 2012 ballot.

You can help put this over the top today. Click here to sign the official initiative petition and put Initiative Petition 5 on the November election ballot.

The measure, Initiative Petition 5, prohibits the practice of taxing home sales in Oregon. These taxes are a form of double taxation on top of property taxes that are paid to support schools and local government.

In reality, these taxes on home sales, known as Real Estate Transfer Taxes, are not common practice in Oregon, though they are common throughout the country. In Oregon, only Washington County levies a small tax on the sale of property.

However, over the past decade, the Oregon Legislature has considered nine attempts to authorize a home sales tax at the state or local level.

It’s a real issue, and the impact of a Real Estate Transfer tax is significant. At a 2% tax rate (the current national average), it would add $3,800 to the average home sale in Oregon.

In Oregon today, distressed properties make up 33% of home sales. Oregon home prices have declined 28% since 2007. Taxing the sale of distressed properties is a poor policy that will further dampen this critical sector of our economy.

Click here to sign the official initiative petition and put Initiative Petition 5 on the November election ballot.

Union Ballot Measures Present a False Choice

Raising taxes vs. cutting services is a false choice. How about growing the economy?

Earlier this month, Oregon’s government unions filed 13 new ballot measure proposals for the upcoming 2012 elections. Presumably, the unions will begin to do polling on these measures and begin collecting signatures to put some of them on the November 2012 ballot.

Many of the 13 proposed measures add to the tax increases of Measures 66 and 67, passed by Oregon voters last year.

For instance, the unions’ Petition 28 adds to the Measure 67 tax hikes by adding a new 10% corporate tax (up from 7.6%) on companies with $10 million in earnings.

Petitions 33 and 34 add to the Measure 66 tax hikes by increasing taxes from 9.9% to 13.4% for taxpayers and small businesses with incomes of $500,000.

Petition 39 would separate out the “top 1%” of taxpayers and small businesses and increase their state taxes to 13.6%.

Petition 41 would tell the legislature to determine which Oregonians can receive longstanding tax exemptions (the personal exemption, home mortgage interest, capital gains on home sales, etc) and who cannot.

Presumably, Oregon’s government unions believe there should be more money available to stave off cuts to the state’s most vital government services.

We don’t disagree with that. But finding new people (and employers) to scapegoat and tax isn’t the answer. It’s a tired approach that is bogging our state down.

The latest case in point? This week Portland’s unemployment rate finally falls below 9% for the first time in three years - but without any new jobs being created. Instead, 3,100 Oregonians simply gave up looking for work.

We believe that economic growth, job growth, and income growth is the only real answer for moving Oregon forward.

We’ll illustrate.

Portland’s Economic Health – By the Numbers
Portland-area employment and income still lagging

A group of Oregon’s leading business associations released a report this week detailing how the Portland Metropolitan economy ranks with other metropolitan economies throughout the US.

Some interesting findings:

Portland-metro’s employment per capita remained 6 percent below pre-recession levels by the close of 2010, compared to a 5 percent gap among all U.S. metros.

Portland-metro’s employment drop was also worse, dropping 8 percent (or by 81,200 fewer people employed), which was two percentage points lower than the average for U.S. metro areas. Only 17,900 new employees have been added back.

Portland-metro is ranked 23rd in population size, but 73rd in real personal income per capita and 136th in employment per capita. Seattle, Denver and Minneapolis metros continue to exceed expectations, generating higher per capita incomes than would be predicted by their size alone.

There is some good news…One area where Portland-metro performs exceptionally well is in the growth of its gross metropolitan product per capita (GMP). Between 2001 and 2010, the Portland-metro’s GMP per capita grew from about 5 percent below the U.S. metro average to about 20 percent above the U.S. metro average.

See Portland’s 2011 Economy By the Numbers

Measure 66 Tax Reductions Must Occur
No Justification for Keeping Tax Rates at Highest Levels

As we talked about last week, Oregon’s tax revenues continue to decline due to lackluster job creation and declining business incomes. In short, our economy is not producing enough taxpayers.

In response, Oregon’s government unions want to cancel tax rate reductions that were written into Measure 66, which was approved by Oregon voters last year. Under Measure 66, Oregon’s top tax rates are scheduled to ratchet down slightly on January 1st – but they’ll still be higher than pre-Measure 66 tax rates.

Said one government union lobbyist to the Salem Statesman Journal last week, “It’s surprising to me that at this time when there’s a real crisis…that no one is talking about the big tax cut to millionaires that’s coming up January 1.”

The article went on to report that union lobbyists are “dismayed” that Oregon legislators appear not to be considering “gaining more money by raising taxes on wealthy Oregonians.”

We believe legislators are absolutely correct not to consider this option at all.

On this issue, a little perspective goes a long way…

Keeping Our Focus on More Jobs, Higher Incomes
Moving Oregon Ahead Requires a Focus on Job Creation

This week, we’re refocusing ourselves on what matters most for Oregon today: Creating more jobs and higher incomes for Oregonians.

An assessment of where Oregon stands today would show:

♦ Oregonians are poorer than our neighbors in Washington and the U.S.

♦ Our 9.6% unemployment rate exceeds the national rate, and our “functional” 19.6% unemployment rate is 4th highest in the U.S.

♦ We’re getting older as a state, with fewer workers to support the services needed for an aging population

♦ Oregon’s public pension system is the most expensive in the nation, putting incredible pressure on government budgets

♦ Healthcare costs threaten to devour our state budget, leaving no room for educational investments

♦ Our tax system levies some of the highest tax burdens in the U.S. on income and investment – discouraging exactly what we need to fuel economic growth

It’s a toxic mix of policy and events that threatens the future prosperity of every Oregonian.

The only solution is a dedicated focus on growing more jobs, producing higher incomes, and changing the way state government operates to achieve better results with limited resources.

As the Oregon Legislature prepares to come back into session early next year, we’re going to be talking about those issues that will generate more jobs and higher incomes for Oregonians.

Specifically, we’ll be talking about these job creating efforts

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