- Associated Press - Wednesday, June 17, 2015

SALEM, Ore. (AP) - A controversial plan to borrow $161 million for seismic and other upgrades to the state Capitol is on life support as legislative leaders hustle to finish Oregon’s next budget.

And fervent support from Senate President Peter Courtney, D-Salem, may not be enough to save it.

Republican jabs - arguing the project amounts to lawmakers putting their own needs before those of thousands of Oregon schoolchildren in seismically suspect buildings - seem to be resonating with key Democrats looking ahead to next year’s elections.

But just as consequential? Gov. Kate Brown and House Speaker Tina Kotek, D-Portland, have their own agenda: finding $100 million to build thousands of units of affordable housing.

With other requests worth hundreds of millions on the table - all butting up against a nearly $1.2 billion cap on how much the state can sell in general fund and lottery bonds over the next two years - there’s likely not enough money to make all three Democrats happy.

How, and if, any compromise comes together would mark one of the only bits of budget drama left in a legislative session that’s mostly been marked by fights over policy.

“Lines are being drawn,” said Rep. John Huffman, R-The Dalles, a supporter of the Capitol renovations and a member of the small budget-writing subcommittee that helps decide how the state spends its bond revenue.

Sources in both chambers stressed the sensitivity of the discussions, with some House Democrats worried that if they dismiss the Capitol renovations too brusquely, Courtney might not be as willing to bend on housing investments or other priorities that need help clearing the Senate as the session winds down.

Lawmakers wrestling with what they say is an unusually large list of requests for bond-financed projects - ranging from courthouse fixes to help for universities - expect to come up with a near-final list by the end of this week.

Most of that work has been done behind closed doors, by a group of lawmakers including Courtney; Kotek; Sen. Richard Devlin, D-Tualatin; Sen. Fred Girod, R-Stayton; and Rep. Tobias Read, D-Beaverton. The group last met Thursday afternoon.

So far, the Capitol project has yet to be scratched off. Sources also say the group hasn’t settled on a final sum for the governor’s housing proposal.

“The conversations I’m having are not political,” Read said. “They’re about how can we stretch taxpayer dollars as far as they can go.”

Yet Devlin, the Senate’s lead budget writer, linked the two projects in an interview with The Oregonian/OregonLive - making clear that requests for state bond money and other revenue “go beyond how much resources we have.” He stopped short of describing the two in an “either/or” situation but acknowledged the House’s and Senate’s competing agendas.

Told of Devlin’s comments, spokeswomen for Brown and Kotek both played down any talk of tension.

“President Courtney has been real clear on his priorities,” said Kristen Grainger, Brown’s communications director, “and so has Governor Brown.”

“The speaker believes each bonding request should be - and will be - evaluated based on its own merits,” said Lindsey O’Brien, a spokeswoman for Kotek.

Courtney’s office, through a spokesman, declined to comment. But Courtney has been an outspoken proponent of making the renovations - even suggesting, at one point, that the Capitol be closed for children in light of the danger posed by its unreinforced marble-and-masonry walls in a major earthquake.

The state has already spent more than $30 million on planning for the project, which would not only shore up the Capitol’s structure but add hearing rooms, overhaul wiring and plumbing, and expand amenities such as the building’s basement cafeteria. Overall, the project would cost $337 million over four years.

As he faced criticism over the Capitol renovations, Courtney last year also proposed borrowing $200 million over the next two years to help school districts statewide remodel or rebuild dozens of buildings. Courtney had helped secure a ballot measure giving the state that ability years before.

But even if the Capitol renovations make the final list of bond projects, that’s no guarantee they’ll go forward. Senate Republicans have long insisted that the Capitol project come up for consideration separate from the list of other projects. That demand could also find purchase in the House. Putting the bill up by itself could make it easier for skeptics to say no.

“That’s another big decision that’s got to be made,” said Huffman, who likened the renovation project to a homeowner dealing with “deferred maintenance.” ”I’ve been trying to message it as good as I can in my caucus.”

Senate Minority Leader Ted Ferrioli, R-John Day, has been the loudest voice in demanding more money for schools instead. He’s proposed borrowing $300 million for school renovations - topping Courtney’s request by $100 million.

“We’re not sure about the politics in other caucuses,” said Stephen Elzinga, legislative director for Senate Republicans. “But we know our members support putting our schools first.”

Ferrioli, documents show, was part of a committee that voted unanimously in 2013 for the master plan meant to guide the Capitol project. He also was one of four votes against 2005 legislation that authorized the use of bonds for seismic work on schools and public safety buildings.

A spokeswoman, asked about those votes, said she was checking with Ferrioli for a response.

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Information from: The Oregonian, https://www.oregonlive.com

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