Tag Archives: oregon

by - 0 comments

Our Oregon: shooting Oregon in the foot – Dems and unions want more money to spend on more “stuff”

 

Tax big business. “Yeah.. that’s the ticket! Yeah, you betcha!,” SNL’s Tommy Flanagan would say.

bloated-government-cartoon

A Better Oregon, a campaign organization operating under the umbrella of Portland-based Our Oregon, a coalition of unions and progressive groups, agrees.

A Better Oregon is promoting Initiative Petition 28 for the November 2016 ballot. The measure would raise the corporate minimum tax on Oregon sales of more than $25 million a year from the current minimum of $50,000 to $30,001 plus 2.5 percent of the excess over $25 million. The tax would be based solely on sales, not profit.

The Legislative Revenue Office estimates the corporate tax measure would raise $5.3 billion during the 2017-2019 biennium. Corporate taxes during that biennium under the current system are projected to reach about $1.1 billion.

In other words, the measure would increase corporate tax collections per biennium by a whopping 400 percent in one fell swoop.

Rep. Mitch Greenlick (D-Portland), when endorsing the measure, said it would eliminate much of the constant need to choose between funding critical budget concerns each legislative session. “If that passes, we’ll have a lot of money to pay for stuff,” Greenlick said.

Otherwise, Greenlick said, most of the additional revenue in the economic forecast for the 2017-2019 budget would go to cover increased PERS liabilities and the state’s increased share of Medicaid funding, leaving little additional revenue for new stuff.

But not to worry, says Ben Unger, executive director of Our Oregon. The extra money won’t come out of your pocket. It will come mostly from large out-of-state corporations.

About 1,000 corporations doing business in Oregon, mostly multi-state corporations, would be affected by the higher taxes.

“This measure will make sure that large and out-of-state corporations do their part to fund the schools and services that will make Oregon thrive,” Our Oregon says on its website.

As long ago as I can remember advocates for higher taxes in Oregon have been making “out-of-state corporations” the bogeyman, the malignant beast that’s doing Oregonians wrong and needs to pay.

But as attractive a target as these corporations are, they’re not fools. They will find a way to avoid paying the taxes or they’ll pass on the added taxes to Oregon consumers as a stealth sales tax.

Moving a company’s headquarters to another state with a more congenial tax environment, as GE is doing with its recently announced shift from Connecticut to Massachusetts, won’t solve the problem, but there are always run-arounds.

Maybe some businesses will change their ownership form to get sales in Oregon under the $25 million trigger. Others may institute some special, higher regional pricing.

Some creative companies may become benefit corporations. Our Oregon thought it was being clever and supportive of the “good guys” when it inserted a provision in its initiative to exclude benefit companies under ORS 60.754 from the higher taxes. But this opened a loophole ripe for exploitation.

The liberal coalition behind Initiative petition 28, recalling their success in a tax increase battle in 2010, may be figuring they have a sure thing again with another measure targeting big business, but hopefully Oregonians in their wisdom will see this  proposal is a reach too far.

 

 

by - 0 comments

Benefit corporations: no sure thing

Lots of progressives in Oregon are big on public affirmations of goodness. That’s why they love the idea of benefit corporations, such as Neil Kelly, Rogue Creamery, Metropolitan Group, Medolac and Good Clean Love.

But before Oregonians conclude that benefit corporations are by their nature more socially responsible businesses, think again, and do some rigorous research. The fact is, in some cases the designation is being used as little more than a way to add a patina of respectability to otherwise questionable firms.

For a truly inauthentic attempt at sincerity and goodness, look no further than Laureate Education, Inc. It announced plans earlier this year its plans to do a $1 billion initial public offering (IPO) that would make it the first publicly traded benefit corporation.

If you’ve heard of Laureate, it may be because of its connection to former president Bill Clinton. In 2010, he signed on to become an “Honorary Chancellor”, or paid shill to be more accurate, for Laureate. In return for serving as a front man for the privately held for-profit education company, Clinton collected $16.5 million between 2010 and 2014. Laureate also has donated between $1 million and $5 million to the Clinton Foundation.

In its IPO prospectus, Laureate says, “we may take actions that we believe will benefit our students and the surrounding communities, even if those actions do not maximize our short- or medium-term financial results.” There’s little in its history, however, that suggests such an approach is part of the company’s DNA.

“We recognized the enormous importance that society places on education as a public good,” said Douglas L. Becker, Founder, Chairman and CEO of Laureate. “This inspired us to create a culture that combines the ‘head’ of a business enterprise with the ‘heart’ of a non-profit organization. “

With one million students studying online and on campuses at 88 institutions in 28 countries, Laureate is currently a private company, but it plans to go public. The company grew out of the K-12 tutoring company, Sylvan Learning Systems, in 2004 when Sylvan was spun off.

Laureate was taken private in a $3.8 billion deal in 2007. Investors included KKR & Co., Soros Fund Management, Paul Allen’s Vulcan Capital, Steve Cohen’s SAC Capital Advisors, Citi Private Equity, Sterling Capital and others, all investors whose commitment to corporate citizenship and the public good is unclear.

Registration as a public benefit corporation is also no guarantee that the governance of a company will be friendly to shareholders.

Steven Davidoff Solomon, a professor of law at the University of California, Berkeley, has pointed out that Laureate’s form of governance is especially unfriendly to shareholders. While Laureate is listing its stock as a public benefit corporation, it will also be going public with dual-class stock, which will maintain its current owners’ control over the company. This includes K.K.R. which will indirectly hold a greater than 10 percent interest in the company.

This doesn’t make sense, Solomon argues. K.K.R. is out to sell its stake at the highest price possible, not benefit other causes. So one has to wonder how strongly Laureate will even pay heed to the public benefit standard.

Then there’s the question of whether Laureate’s schools operate in the best interests of their students.

It’s 5 schools in the U.S. include: NewSchool of Architecture & Design, San Diego, CA; Santa Fe University of Art & Design, Santa Fe, NM; Kendall College, Chicago, Il; University of St. Augustine for Health Sciences, St. Augustine, FL; and the online-only Walden University, Minneapolis, MN.

newschool

Consider their records on the U.S. Department of Education’s College Scorecard, an online system designed to help students, parents and advisers make better college choices.

For example, according to the Scorecard:

  • The average annual net cost of attending NewSchool is about twice the national average, only 50 percent of students return after their first year and the graduation rate after six years is only 33 percent.
  • The average annual net cost of attending Kendall College is more than twice the national average, only 57 percent of students return after their first year and the graduation rate after six years is only 45 percent.
  • At the Santa Fe University of Art & Design, only 31 percent of the students graduate within six years and only about half of those graduates subsequently earned, on average, more than those with only a high school diploma.

Laureate also operated The National Hispanic University in East San Jose, CA, but it closed in August 23, 2015. The San Jose Mercury News attributed the closure to the U.S. Department of Education reducing financial aid and online opportunities for students enrolled in programs that did not offer good prospects for employment. Other media reported that the school also failed to meet its goals in enrollment for online coursework.

It will be interesting to see how this company, that has a history of questionable payments to Bill Clinton, is $4.7 billion in debt, is burdened with high interest payments, has lost money every year since 2010 and has a habit of saddling its students with debt and low graduation rates pulls off its public benefit corporation charade.

It may be a hard lesson for a lot of true believers in benefit corporations.

by - 0 comments

Flip or flop – resistance is futile

They should have known.

Tarek and Christina El Moussa, the hosts of HGTV’s show Flip or Flop, figured Portland would be a natural market for their traveling seminar on how to remodel and flip houses for a profit. So they scheduled four seminars in Portland to teach the tricks.

fliporflop1

And, of course, Portland’s lefties went ballistic.

“Stay out of Portland!!,” said a typical online post. “You’re preying on low income families and marketing to out of state buyers that are pushing locals out. You are not welcome!!”

But wait a minute. If you’ve ever watched Flip or Flop, you’d know that what the Moussas do is buy generally crummy houses, invest in substantial upgrades and sell them (hopefully for a profit), substantially enhancing the neighborhood. What’s wrong with that?

Would Portland’s lefties prefer that rundown houses just sit there as eyesores in nice neighborhoods? Would they prefer that dilapidated houses sit empty, attracting vandals and squatters?

Critics of the Moussa’s visit were likely motivated, in part, by their objection to so-called gentrification, upgrades of neighborhoods driven by economic and demographic changes.

What the objectors fear is a dislodging of the local culture and its replacement by higher income, higher educated, higher status residents of all racial and ethnic populations who patronize a more upscale mix of retailers.

But gentrification, for all its negative connotations to lefties (who, by the way, are often a key part of the gentrifying population) is what turns decaying areas of cities into neighborhoods of residents and businesses who pay taxes that lead to upgrades in infrastructure and government services across the board for everybody.

If you have children who recently graduated from college or are about to, they will likely be part of this process, too, as they look for good jobs and great places to live, push up the population and housing costs in already gentrified areas and put pressure on other not-quite-there-yet neighborhoods.

As they say in Star Trek, resistance is futile.

 

 

 

by - 0 comments

Still struggling: four Oregon areas still missing in action

The Great Recession is over. Right? Don’t tell that to the folks who live in four areas of Oregon designated among the most distressed communities in the state.

According to an exhaustive analysis just released by the Economic Innovation Group (EIG), a significant portion of Americans still feel like the recovery has left them behind. That translates into over 30 million Americans living in communities defined by slow job growth, vanishing businesses, and fewer opportunities to move up the economic ladder.

EIG used seven metrics to assess economic well-being:

  • Educational Attainment: Percent of population 25 years and over with a high school degree.
  • Housing Vacancy Rate: Percent of habitable housing that is unoccupied.
  • Unemployment Rate: Share of the labor force that is unemployed.
  • Poverty Level: Percent of population living under the poverty line.
  • Median Income Ratio: Ratio of the zip code’s median income to the state’s median income.
  • Change In Employment: Percent change in the number of individuals employed.
  • Change in Business Establishments: Percent change in the number of businesses.

Oregon compares relatively well overall to the rest of the country in terms of the economic health of its residents (EIG considers just 4% to be living in economic distress, http://bit.ly/1S2eoVR), but it’s not totally in the clear.

Based on the metrics above, the following Oregon zip codes earned the dubious distinction of being the state’s most economically distressed areas in four different population density categories:

Density Category Location Zip Code
Very High Portland 97209
High Portland 97204
Medium Medford 97501
Low Christmas Valley 97641

Zip code 97209 in Portland is the most distressed area in the Very High Density category in Oregon.

Zip Code 97209

Zip Code 97209

Approximately 35.1% of 97209’s population lives in a low-income household with an annual income of less than $25,000 and another 20.7 percent live in a household earning an annual income between $25,000 and $50,000.

Portland zip code 97204 is the most distressed area in the High Density category.

Zip Code 97204

Zip Code 97204

Estimated annual median household income is just $13,350, significantly below the state average, and 91 percent of the households have an annual income of less than $30,000. Residents with a high school degree or less comprise 78 percent of the population.

Zip code 97501 in Medford is the most distressed area in the Medium Density category in Oregon.

Zip Code 97501

Zip Code 97501

Approximately 34.6% of 97501’s population lives in a household with an annual income of less than $25,000. Another 29.1% live in a household earning an annual income between $25,000 and $50,000. Annual median household income is $36,157. That puts 97501 363rd among all of Oregon’s zip codes.

As a side note, maybe tied to the local economy, 97501 has almost 8 bars per 10,000 residents, 32% more bars than average for Oregon and  95% more than the United States as a whole.

Zip code 97641, a sparsely populated area in Christmas Valley is the most distressed area in the low density category in Oregon.

Zip Code 97641

Zip Code 97641

Only 12 percent of the population has education beyond high school, connected, perhaps, to the fact that the median annual household income is 20,795 and 66% of the households have an annual income below $30,000.

In the coming weeks, EIG will be developing tools to enable people to easily compare communities and dive deeper into what is driving economic distress or prosperity. You will be able to see how well your community is doing, and then compare it to others across the country

by - 0 comments

Sen. Jeff Merkley: leading the way in partisanship

So much for working well across the aisle for the common good.

Jeff Merkley, D-OR, is one of the most partisan U.S. Senators, according to a just compiled Bipartisan Index that measures members of Congress. Of 100 Senators, Merkley ranked 93rd in bipartisanship.

Sen. Jeff Merkley, D-OR, a true blue partisan.

Sen. Jeff Merkley, D-OR, a true blue partisan.

A low score indicates that a legislator is viewing his or her duties through a partisan lens, rather than prioritizing problem solving and being open to working with the other party when possible, entertaining a wide range of ideas, and prioritizing governance over posturing.

The Lugar Center, a non-profit organization focusing on global policy issues, teamed up with the McCourt School of Public Policy at Georgetown University to develop a Bipartisan Index to measure members of Congress. The ranking of all senators, released for the first time on Tuesday, rates lawmakers by how their legislation does in attracting co-sponsors from the other party as well as how often they sponsor legislation proposed by members across the aisle.

“…sponsorship and co-sponsorship behavior is especially revealing of partisan tendencies,” said former Senator Richard G. Lugar, President of The Lugar Center. “Members’ voting decisions are often contextual and can be influenced by parliamentary circumstances. Sponsorships and co-sponsorships, in contrast, exist as very carefully considered declarations of where a legislator stands on an issue.”

Berkeley’s abysmal ranking in the Bipartisan Index suggests that he’s more interested in making political points than being an effective legislator. Partisan bills certainly have their place, but as Lugar said in his Introduction to the Bipartisan Index, “…at the beginning of the legislative process, when effective governance would argue for broadening a new bill’s appeal, too often the opposite is happening.  Bills are being written not to maximize their chances of passage, but to serve as legislative talking points.  Taking a position is not the same thing as governing.”

by - 0 comments

The Oregon Convention Center Hotel: paying off the unions

Ask any informed person without a vested interest in the proposed Oregon Convention Center Hotel whether they think it will be a fiasco and you’re likely to get a loud and clear, “Yep!”

But public opinion has little to do with whether the hotel will get built. The fix is in, with Metro, liberal politicians and labor unions joined at the hip.

Metro Council President Tom Hughes, the hotel’s principal cheerleader, was first elected to Metro in 2010 with the strong support of labor organizations; they continued that support in his successful 2014 race.

“I want to build a hotel,” Hughes once told union workers. “I want it to be built by union workers, and I want union workers running it.”

unite here

Portland has just three union-operated hotels, all organized by Unite Here Local 8: the Benson; the Paramount; and the Portland Hilton Hotel and Executive Tower.

The unions got their first break on the Convention Center project when Metro mandated that the hotel be built by union building trades.

Prospective developers were also told to bid the privately-owned and operated project under union-supported prevailing wage guidelines where wages are set artificially high above the market.

Metro stacked the deck in favor of the unions again when the Council required that Hyatt sign a labor peace agreement with Unite Here before Metro would begin negotiating the details of the project. Hyatt, long a non-union hotel chain, subsequently agreed to a national labor peace agreement with Unite Here.

Metro also gave unions an edge in organizing the eventual hotel workers by requiring that they use a voting process despised by employers and many workers called card check. Under card check, instead of holding a federally-supervised secret ballot election, workers get to vote under the watchful eyes of union organizers, Lucky them.

Once a majority of employees have signed cards, the union is immediately recognized.

As the AFL-CIO’s Southeastern Oregon Central Labor Council put it, the hotel workers “…will come into a workplace where their management has promised to leave any decisions to the workers without wasting money on deceiving anti-union campaigns.”

Yep, folks, the fix is in.

by - 1 Comment

Subsidizing electric cars in Oregon: a shockingly bad idea

Batteries don’t charge up electric cars; government subsidies do. At least that’s what supporters of a bill now before the Oregon House seem to believe.

The bill, H.B. 2092, would establish an Incentive Fund to make rebates of up to $3000 to purchasers of alternative fuel vehicles, including those that are powered by batteries or hydrogen fuel and gasoline-electric vehicles. Rebates from the fund could total as much as $30 million per biennium and would be on top of the already absurd federal subsidy of up to $7500.

Just what we need, a $30 million government subsidy to purchasers of pricey cars, when Oregon is already one of the top states for EV market share and the state has many other more pressing concerns to address.

The House Energy and Environment Committee held a public heating on the bill on April 2 and has a work session on the bill scheduled for today, April 16.

Under the bill, state rebates would help affluent Oregonians buy vehicles such as the $43,000 BMW i3 and $135,000 i8, the $42,000 Mercedes B-Class, the $106,000 Tesla Model S P85D, and the $35,000 Chevy Volt.

The purchaser of a $135,000 BMW i8 would be eligible for a $3,000 rebate from the state under H.R. 2092

The purchaser of a $135,000 BMW i8 would be eligible for a $3,000 rebate from the state under H.R. 2092

To put things in perspective, $30 million is more than the TOTAL state income tax liability of all personal filers in 16 Oregon counties in 2013: Baker County ($13.1 million), Crook ($18.2 million), Curry ($19.6 million), Gilliam ($12.1 million), Grant ($5.9 million), Harney ($5.1 million), Jefferson ($15.5 million), Lake ($6.2 million), Malheur ($17.6 million), Morrow ($11.1 million), Sherman ($2.6 million), Tillamook ($23.6 million), Union ($24.7 million), Wallowa ($6.1 million), Wasco ($23.6 million) and Wheeler ($1.3 million).

If I lived in one of those counties I wouldn’t look kindly on all my personal state income tax payments going to this alternative fuel vehicle boondoggle.

Let’s be honest here, folks. There are a lot of other places $30 million could be invested more wisely in Oregon.

Seven Oregon counties have been losing population, Coos, Baker, Wallowa, Malheur, Grant, Wheeler, and Sherman.

If the Legislature can find another $30 million to spend, why not use the $30 million to help these struggling counties attract businesses?

Deserving young people around the state are dealing with the stresses and strains of trying to find the money to pay for post-secondary education.

Why not put the $30 million in Oregon Opportunity Grants, the state’s need based financial aid program.

The state invests in Employment Related Day Care in support of the Early Learning initiative, providing greater access to quality childcare for Oregon’s working families.

How about adding $30 million to the budget for that?

A potential decline in lottery revenues during the 2015-17 biennium is likely to present budget issues for the Oregon Parks and Recreation Department, Oregon Watershed Enhancement Board, Department of Agriculture, Department of Environmental Quality, Oregon Department of Fish and Wildlife, and the Oregon State Police Division of Fish and Wildlife. In addition, the Oregon Department of Fish and Wildlife is facing a significant budget shortfall.

The legislature could help out the Natural Resource Program area by adding $30 million to its budget.

The logical decision? Short-circuit this bill.

by - 1 Comment

We’re waist deep in the Big Muddy: the Oregon Convention Center hotel

The 990,000 sq. ft. Crystal Palace opened at Britain’s Great Exhibition of the Works of Industry of All Nations in London’s Hyde Park in 1851.

The 990,000 sq. ft. Crystal Palace opened at Britain’s Great Exhibition of the Works of Industry of All Nations in London’s Hyde Park in 1851.

For some reason, politicians are infatuated with building stuff. They’re objectophiles, aroused by, even obsessed with, things rather than people

In Portland, politicians have fallen head over heels in love with the idea of building a Convention Center hotel. The object of their desire is a subsidized $212 million 600-room Hyatt Hotel.

But the fact is, it was a bad idea right out of the gate and it’s an even worse idea now.

On the one hand, given Portland’s vigorous emergence from the Great Recession and a skyline brimming with construction cranes, the assumption that government-mandated subsidies are critical to building a convention center hotel is outdated if Metro believes the hotel’s success is a slam dunk. On the other hand, if the growing competition in the convention market will make adding a subsidized hotel a foolish gamble, then why do it at all?

“Faced with convention centers that are routinely failing to deliver on the promises of their proponents and the forecasts of their feasibility study consultants, many cities wind up, as they say, “throwing good money after bad,” said a Brookings report. “Indeed, weak performance—an underutilized center, falling attendance, an absence of promised private investment nearby—is often the justification for further public investment. A new center is thus often followed by a subsidized or fully publicly-owned hotel…”

A May 2013 rendering of a proposed Hyatt hotel at the Oregon Convention Center.

A May 2013 rendering of a proposed Hyatt hotel at the Oregon Convention Center.

So here we are.

The Portland project would be funded with $60 million in Metro-issued revenue bonds, backed by taxes the hotel would generate, plus $18 million in grants and loans from Metro, the Portland Development Commission and the state lottery.

But there are problems with Portland’s hotel proposal, as well as with the arms race of convention center-related construction going on around the country. According to CityLab, there simply aren’t enough big conventions to justify all the convention center expansions. Since 1995, convention space in the United States has increased by 50 percent, but convention growth hasn’t kept pace. “So many were saying, ‘all you have to do is get one percent of the national market and you’ll do just fine,'” he says. “Three hundred cities bought the same logic.”

In fact, the number of conventions in the United States has fallen over the past decade, as has attendance at the largest conventions.

The optimistic predictions for the Oregon Convention Center and an associated hotel neglect to consider that lots of other cities are expanding, too.

Boston is considering a $1 billion expansion of its convention center with a massive 1,200 room $800 million hotel. A Marriott Marquis Hotel is expected to open in 2016 across from the George R. Brown Convention Center in Houston. Hotel operators Omni, Hyatt, Starwood, Peabody and Marcus have shown interest in a request issued by Oklahoma City to develop a 500- to 800-room downtown convention hotel to go with a $287 million convention center scheduled to open in 2019.

Even Des Moines, Iowa is in the game. In Feb. 2015, city and county officials approved a $101 million 10-story 330-room convention hotel project attached to the Iowa Events Center. Officials said they expected the project would draw many more national events to Des Moines and add considerable revenue to the property tax base.

And the list goes on and on.

But not to worry. Portland has advantages because it’s a happening city – food, culture, livability, young professionals – enthused the Oregon Convention Center’s ebullient 2013-2014 Annual Report. That year, the Center hosted 343 events attended by 549,762 people, many of them first time visitors to Portland, the report proclaimed.

But dig deeper into the dry numbers at the end of the report and you’ll find a less glowing story.

The number of events at the Oregon Convention Center actually shrank from 469 in FY2011 to 392 in FY2012, 377 in FY2013 and 343 in FY2014. Meanwhile, net operating results showed losses growing from $10 million in FY2011 to $11.6 million in FY2014.

Despite these numbers, and continuing controversy over the planned subsidized hotel, Metro president Tom Hughes calls critics “short-sighted and selfish” for wanting a public vote on the hotel project.

The hotel plan “promises generous returns for many years to come,” Hughes has said.

So we slog along.

Waist deep! Neck deep! Soon even a

Tall man’ll be over his head, we’re

Waist deep in the Big Muddy!

 

by - 0 comments

Stuck: running in place in Oregon

I work in Hillsboro, OR where evidence of a strong economy is everywhere. It’s tempting to assume that family income must be growing by leaps and bounds in Washington County, too, and to extrapolate and assume all is well statewide.

Not so much.

In fact, even Washington County isn’t doing that great, despite the presence of Intel, which has been growing like kudzu, feverishly sprouting buildings and good jobs.

Way back, growth in the U.S. economy was accompanied by income increases across the board, improving the lot of the poor and expanding the middle class. Everybody shared in the rising tide.

middle_class_family

But that hasn’t been happening for a long time. Now a lot of people find themselves working harder, but just treading water.

“Over the past 25 years, the (U.S.) economy has grown 83 percent, after adjusting for inflation — and the typical family’s income hasn’t budged,” according to a recent analysis by the Washington Post. “In that time, corporate profits doubled as a share of the economy. Workers today produce nearly twice as many goods and services per hour on the job as they did in 1989, but as a group, they get less of the nation’s economic pie.”

The result? In 81 percent of America’s counties, median family income is lower today than it was 15 years ago, the Post analysis revealed.

What about in Oregon? I decided to look deeper. The data shows that in 25 Oregon counties, the inflation-adjusted median family income is lower today than it was 15 years ago.

That’s true even in Washington County where median household income, adjusted for inflation, actually peaked in 1999 at $72,787. That year was also the peak for such wildly dispersed counties as Clackamas, Deschutes and Malheur.

The situation is even worse in counties such as Baker and Lake where median family income, adjusted for inflation, hit its peak 35 years ago.

If you really want to hit bottom, there are six counties, including Curry, Lane and Wheeler, where medium family income, adjusted for inflation, peaked 45 years ago. That’s right, almost half a century ago, when Richard Nixon was inaugurated President and the Apollo 11 astronauts, Neil Armstrong and Edwin E. Aldrin, Jr., took their first walk on the moon.

So what we have in Oregon is an economy in which few of us are really better off economically then we were years ago.

Here’s the county-by-county breakdown of when median household income, adjusted for inflation, peaked in each of Oregon’s 36 counties and the level at which it peaked.

Oregon-county-map

County Peak Year Amount
Hood River 2013 $56,725
Sherman 2009 $52,664
Washington 1999 $72,787
Clackamas 1999 $72,264
Columbia 1999 $63,555
Yamhill 1999 $62,070
Polk 1999 $59,218
Benton 1999 $58,558
Deschutes 1999 $58,159
Multnomah 1999 $57,733
Marian 1999 $56,673
Linn 1999 $52,326
Crook 1999 $50,759
Jackson 1999 $50,734
Clatsop 1999 $50,289
Jefferson 1999 $49,678
Tillamook 1999 $48,026
Wallowa 1999 $44,726
Josephine 1999 $43,406
Malheur 1999 $42,525
Morrow 1979 $57,126
Wasco 1979 $54,645
Harney 1979 $54,318
Umatilla 1979 $50,513
Lake 1979 $49,714
Grant 1979 $48,786
Union 1979 $48,006
Lincoln 1979 $47,053
Baker 1979 $42,760
Lane 1969 $52,736
Coos 1969 $52,171
Gilliam 1969 $49,892
Klamath 1969 $49,511
Curry 1969 $49,042
Wheeler 1969 $40,675

SOURCES: U.S. Census and American Community Survey. Amounts in 2013 dollars.

by - 0 comments

Who owns Chuck Riley?

Democrat Chuck Riley’s defeat of Republican Bruce Starr on Nov. 4 for Oregon’s 15th District Senate seat cost a ton of money. Now, like a company that’s gone public, his key supporters are going to expect a return on their investments.

rileySenate

As of Dec. 8, 2014, Riley’s campaign committee, Friends of Chuck Riley, had raised $913,372.33 and spent $889,757.01, according to records on file with the Oregon Secretary of State. The onslaught of campaign cash was so great that the contest ended up being the most expensive state Senate race in Oregon history.

But it was also a very tight race, with Riley finally coming in ahead by just 287 votes out of 39,734 cast. Likely costing Starr the race was the Libertarian candidate, Caitlin Mitchel-Markley, who captured 3,593 votes.

That suggests the next race will be hard fought as well, particularly if no 3rd party candidate runs, and that it will again require a substantial war chest. To create that war chest Riley will have to placate some big givers. After all, it was the big givers who filled his coffers, not the little people.
So who does Chuck Riley owe for his victory?

The biggest cash/in-kind contributors to Friends of Chuck Riley were Riley’s own Democratic Party, unions, a climate change activist, trial lawyers, and two national gun control groups.

The money from the Democratic Party came from two groups, the Senate Democratic Leadership Fund ($174,585.50)
and the Democratic Party of Oregon ($107,577.56), which received significant contributions from some of the same characters as Riley’s committee.

For example, former New York City Mayor Michael Bloomberg’s gun control group, Everytown for Gun Safety, donated $75,000 directly to Friends of Chuck Riley and $50,000 to the Senate Democratic Leadership Fund.

Michael Bloomberg

Michael Bloomberg

Riley’s committee also pulled in $10,000 from the Brady Campaign to Prevent Gun Violence.

Other big contributors to Riley’s Committee included:

• Service Employees International Union (SEIU) $204,460.39

This includes: $193,661.96 from Citizen Action for Political Education of SEIU Local 503; $10,798.43 from Committee on Political Education of SEIU Local 49.

seiu

• Oregon League of Conservation Voters PAC $191,120.02

OLCV made an in-kind contribution of $127,498.50 in the form of a TV ad. The balance was in the form of: cash; in-kind field work, postage, preparation and production of advertising and a phone program. The TV ad money came out of a $130,000.00 contribution to OLCV from NextGen Climate Action Committee, established by billionaire Tom Steyer to help candidates who support the need to deal with climate change.

Oregon_League_of_Conservation_Voters-270x222

• Oregon Trial Lawyers Association PAC $38,477.87

otla_logo

• Oregon American Federation of State, County
and Municipal Employees (AFSCME) Council 75
Political Soft $17,500.00

afscme

• Oregon Education Association – People for
Improvement of Education $8,342.00

OEA_logo

• Other unions $10,500.00

Joint Council of Teamsters No. 37 Political Fund
$1,750

United Food and Commercial Workers Union Local
555
$4,500

Oregon School Employees Association – Voice of
Involved Classified Employees
$1,000

International Union of Operating Engineers, Local
701 Misc PAC
$250

American Federation of Teachers-Oregon Candidate
PAC
$3,000

All of the above contributions totaled $752,563.34. That’s 85 percent of total expenditures by Riley’s committee.

Compare that with the amount that came in from contributors of $100 or less, about $8000. That’s less than 1 percent of total expenditures by Riley’s committee. Even if all the small contributors had bundled their money in an effort to enhance their potential influence, they would have been a small player. They might as well have spent their money on a nice dinner out.

So, how are we going to know the influence of the big donors on Riley? It’s not going to be easy.

First of all, it’s not clear that the size of Riley’s war chest was the key determinant in his victory. There’s no hard evidence of a constant linear linkage between campaign money and victory, although a candidate does need enough money to deliver key messages to critical audiences.

But now that Riley has been elected, the major donors are likely to influence positions Riley takes.Equally important, large donations to Riley are likely to give certain interests better access to him to influence public policy in general.

Big donors will also probably have an ability to influence the shape and specifics of legislation that’s before Riley much earlier in the legislative process, when it’s harder for the public to detect.

Large donations may also carry the day on critical votes where Riley’s one vote for or against can determine the fate of a bill. “These low salience critical votes present the most likely circumstances for members to repay groups for their financial support,” according to Lynda Powell at the University of Rochester in a paper on The Influence of Campaign Contributions on Legislative Policy.

One thing is clear – the big donors are going to be keeping an eye on Riley, just like big investors keep an eye on the stock market. All investments carry some risk, but the reward for risk can be a great return.

return-on-investment1