- Associated Press - Friday, May 26, 2017

PORTLAND, Ore. (AP) - Senate President Peter Courtney said Friday there isn’t enough support to successfully approve multi-billion dollar tax reforms on business, transportation and health care.

Those are the top three revenue-raising items steering negotiations for the 2017-19 budget, including solutions for a $1.4 billion shortfall that, combined with cost-cutting options that have also been slow-going, is theoretically already solved. Lawmakers are constitutionally required to balance the state budget by July 10, which leaves about five weeks after accounting for the upcoming Memorial Day and Fourth of July holidays.

Courtney, a moderate Salem Democrat and the Oregon Legislature’s longest-serving lawmaker, stated his concerns during the Senate floor meeting. He said he’s worried that time is running out to break the deadlock in his chamber on the three tax proposals - all of which are still being drafted into formal bills.

“There are not the votes in the Legislature to pass a transportation plan, there are not the votes for (business tax) revenue and there are not the votes for the (health care) provider tax,” said Courtney, adding he spoke to Gov. Kate Brown twice beforehand about the situation. “This thing is just not working right now.”

Tax hike proposals must begin in the House and be finalized in the Senate, with a three-fifths majority vote in each chamber before they can go to the governor. That super-majority means full support is needed from Democrats, who control both chambers, and at least one Republican in each chamber.

Both parties say they’re close to finalizing the transportation package as well as the health care provider tax increase. The transportation plan would raise $8.2 billion over the next decade to pay for modernizing the state’s highway infrastructure through gas tax increases, highway tolls and new levies on car and bicycle sales; the provider tax would close the 2017-19 budget shortfall by almost half, $600 million, and spare the Medicaid expansion program that serves roughly 350,000 low-income Oregonians.

But the tension lies with the business tax proposal, as well as efforts to curb government spending.

Democrats are pushing to overhaul Oregon’s corporate tax system and raise between roughly $1 billion and $2 billion for the next biennium, a net gain after small losses in revenue from reduced personal income tax rates that are also on the table. Another $650 million, a figure recently estimated by House Speaker Tina Kotek, in cost savings is also being eyed mostly from costs tied to public employees, although those efforts have been idle so far.

Republicans argue Democrats aren’t as serious as they say about reigning in government spending, which the minority party argues is the primary driver of Oregon’s budget woes given that tax revenues are at all-time highs. They also oppose the business tax plan because it would adopt a scaled-back version of the corporate levy that voters rejected in November through Measure 97, the labor unions’ $6 billion big business tax hike proposal.

In the Senate, the business tax also faces tension between far-left and moderate Democrats, which Senate Republican Leader Ted Ferrioli says could work in the minority party’s favor moving foward.

“What that does is set up conversations where Democrats and Republicans in the middle can sit down with each other and say ‘OK we’ll accept the death of these policy bills which are not broadly supported, in exchange for the ‘yes’ votes that we need for revenue on health care, and yes we’ll accept a repeal of the low-carbon fuel standard for votes on the transportation package,” Ferrioli told the Associated Press. “Those are the choices: we either have moderation or we don’t have a successful legislative session.”


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