Session Acted on Education to Careers, Natural Resources, Poverty
Transportation Awaits Future Resolution
Connecting Education to Careers
The Governor’s REcommended Budget (GRB) included roughly $60M of investments in STEM & CTE, including weighted funding. The legislature approved $35 million. While the amount was reduced from the GRB and did not include weighted funding, the legislature more than doubled investments from the previous biennium and passed an investment framework that was broadly supported by business and labor organizations. Investments include regional STEM hubs, STEM innovation grants, CTE revitalization grants, a career pathway fund to support underserved students and recruitment of more CTE instructors.
The STEM/CTE package includes pilot projects to allow CTE courses to meet requirements for high school credits and accelerated college credits, and community colleges and university admissions. The legislature also approved $6.8M for accelerated learning/dual credit programs.
The Legislature replaced the Engineering and Technology Industry Council (ETIC) with the Oregon Talent Council (OTC) and transferred to it remaining ETIC funds ($6.1M). The OTC will advise and act as resource for state agencies and educational institutions on issues of talent development to promote growth and competitiveness of Oregon’s high growth industries.
The Legislature appropriated $700 million in funding for Oregon’s universities, a 27.2% increase. The Legislature approved $550 million for community colleges, a 17.9% increase. These investments will help control tuition, expand access, and enhance graduation rates. The Oregon Opportunity Grant received X. The legislature also adopted and invested $10M in the “Oregon Promise,” leveraging federal Pell Grant money to make community college affordable for all Oregonians who enroll in a degree or certificate program.
Put Our Natural Resources to Work for Rural Oregon
The GRB included $50M for communities to develop water resources solutions to meet the needs of fish and agriculture. The Legislature fully funded this effort. The funding will allow critical projects to move forward immediately in the Umatilla Basin.
The GRB proposed $6.05M to accelerate the pace and scale of federal forest restoration. The legislature funded this request at $5M. The GRB also included $1.1M to provide technical and marketing capacity to support forest biomass supply, processing, and production. The legislature did not fund this request. Expansion of the biomass tax credit was proposed but not adopted.
Oregon State University Statewide Service programs received a large $14M boost to fund new programs. The GRB proposed a Natural Resources Transformative Technology Grant program to support the commercialization of new natural resource technologies. It did not get through the legislature. The legislature did provide funding for the operation of a center for manufacturing and design of advanced wood building products, a collaboration between OSU and UO. The legislature also provided $30M in bonding for a new OSU Forest Science Complex.
The Legislature passed two bills and invested $1.2M provide assistance to businesses engaged in western juniper harvesting or manufacturing and promote liaison efforts between public and private activities related to juniper and wildlife management.
The Business Plan’s agenda for poverty reduction was developed and led by the Oregon Business Council Poverty Reduction Task Force. The Legislature responded to many of its policy recommendations.
Oregon’s Temporary Assistance for Needy Families (TANF) program provides very poor families with monthly cash payments and other support as parents search for work and build self-sufficiency. However, the program also included a sharp benefits cliff that causes clients to lose their entire benefit once they begin working as little as 16 hours/week at minimum wage. The GRB included, and the OBC Poverty Reduction Task Force supported, a TANF redesign and reinvestment proposal that responded to a 2014 audit of the program. Savings created by declining caseloads would be reinvested to help families increase their earnings and move off of TANF. This $30M investment proposal, which reworked income limits and earnings disregards to strengthen work incentives and increased flexibility for local investments to better meet the needs of clients, was fully supported by the legislature.
Employer Related Day Care
Employment Related Daycare (ERDC) supports about 8,000 low-income working families in accessing higher quality care for their children through tiered reimbursement that lowers the family co‐pay at higher levels of quality. The Governor’s
Budget proposed an additional $55 million investment, with a 21% increase in cases and better integration of subsidies. The legislature approved a $45M increase.
Child Care Tax Credits
In order to work, families need quality, affordable and accessible child care. Oregon operates two highly related tax credits designed to offset the costs of childcare for low- and middle-income families: the federal Child and Dependent Care Credit and the Oregon Working Families Childcare Credit. The legislature consolidated the two credits and created the Working Families Child and Dependent Care Credit (AKA the “Kenny-Guyer Plan,” named after Representative Alyssa Kenny-Guyer who led the charge). The legislature invested $30M for the tax credit in 2015-2017 and $60M for future biennia. The credit builds off the existing federal credit, so the federal government bears the auditing cost, saving the state up to $1 million biennially. This was a major victory for working families and for the OBC Poverty Reduction Task Force agenda.
Individual Development Accounts
The GRB, the Task Force and its partners recommended extending the sunset on the Oregon IDA 75% Tax Credit. The Oregon
Individual Development Account (IDA) Initiative, one of the largest IDA programs in the nation, provides matched
savings accounts that incentivize saving for specific types of assets. Participants as young as 12 years old receive
financial training, make a savings plan, and save monthly , with a 3:1 match once they meet their savings goal. Oregon’s program has five asset categories: microenterprise, education, homeownership, employment-¬‐related equipment or assistive technology, and home renovation. The program is funded through donations that were eligible for
a 75% tax credit; the credit was scheduled to sunset at the end of 2014. The legislature extended the program through 2022 and added seven new savings categories. The legislature maintained the $7.5M cap on state expenditures for the credit, lowered the tax credit level to a maximum of 70%, and allowed for the tax credit to be sold at auction.
Agree on a Definition of Poverty and Measures for Oregon
The Federal Poverty Level is a widely used measure of pre-tax cash income but is antiquated in terms of defining what families need for a decent life. The OBC Poverty Reduction Task Force recommended creation of a State Task Force to create more meaningful measures of economic and social success to guide state policymaking. The bill creating the Task Force advanced to the Joint Ways and Means Committee but never came to the floor for a vote.
Invest in Community-Led Projects to Increase Prosperity in High Poverty Areas
Through its grant from the NW Area Foundation, the OBC Poverty Task Force has been engaged in three on-the-ground projects in communities across the state to help reduce poverty. These projects include the Malhuer Poverty to Prosperity initiative, providing low-income teens with career and technical education programs that allow them to graduate high school with a diploma and a career certificate; working with Southern Oregon Success to help make low-income students college-ready; and literacy project with the Klamath Tribes and community of Chiloquin. These efforts built off of what have been successful efforts to address complex problems at a community scale including Regional Solutions, Coordinated Care Organizations, Early Learning Hubs, and Regional Achievement Collaboratives. The GRB included a $25M investment to accelerate community-based problem solving by creating a “Center for Community Innovation” and a “Community Leverage Fund” to support communities in implementing projects. The legislature did not advance this proposal.
Modernize Our Infrastructure
The Legislature failed to pass a transportation package. Early in the session Democrats passed the “Clean Fuels” bill to reduce the carbon content of fuels, raising gas prices an estimated 4-19 cents over time. Democrats and Republicans wanted a transportation package but Republicans did not want to raise gas prices twice in one session. Negotiations to modify or repeal clean fuels did not produce a package that could pass through the legislature. The future for a transportation package is uncertain and it is unlikely that a package could emerge before the 2017 session.
The GRB included $58.8M for Connect Oregon VI. The Legislature invested $45M. Connect Oregon funds critical air, marine, rail, and other multi-modal transportation improvements.
The GRB included $28M for low interest loans in the Special Public Works Fund (SPWF) including $7M for industrial site readiness, $7M for levee improvements, and $14M for basic public works. The legislature funded the $7M for levee improvements and a total of $13M to be used for all other projects, for a total of $20M. The GRB also included $14M for the top Regional Solutions projects in each region, and $8M for non-capital projects. The legislature funded $12M for capital projects and $1M for non-capital projects.
The GRB included a $10M “rural infrastructure opportunity fund” to help rural communities seize key economic opportunities. The legislature did not approve this fund. The legislature did pass a bill to allow local governments to create “land bank authorities” to facilitate brownfields cleanup. New brownfield tax credits and property tax abatements were proposed but not approved.