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Legislature's House Democrats sidestep State Constitution to raise $670 million

by State Legislator House District 56, Werner Reschke, guest writer for Herald and News June 29, 2017

Last Friday, Oregon’s Democrat-led House of Representatives voted to raise $667 million in new taxes on the backs of the smallest of Oregon small businesses. Unfortunately, this is nothing new. During the past 10 years Oregonians have seen their taxes increase 48 times, with Democrats in near total control of Oregon’s Legislature and Governor’s office during that stretch.

Since the failure of Measure 97, Democrats have been seeking new ways to increase taxes and raise revenue. The state is short $1.4 billion, they argue, of what is needed to maintain “current service levels” for our state agencies. While we have a disagreement over how large shortfall is, House Republicans have offered help in solving this problem by supporting the following plan:

Step 1: Kill all anti-business/anti-growth bills currently circulating around the Capitol and identify a target economic growth rate that will allow state revenues to continue to grow naturally.


Step 2: Enact systemic changes to the cost structure in government so its growth rate is significantly less.

Step 3: Look at how Steps 1 and 2 affect the budget gap and then consider raising taxes for only new investments (for example not to fund PERS, but to fund Measure 98).

Democrats have rejected Steps 1 and 2 and gone directly to Step 3. While Democrats are in charge of the House — they have the votes to do about anything they want with 35 Democrats to 25 Republicans — they are short one vote to raise taxes which requires a super majority (36 votes). House Republicans have held steadfast on the plan to solving our budget gap.


On Friday, Democrats brought House Bill 2060 A to the floor. HB 2060 A would raise the taxes of small businesses in Oregon with fewer than 10 employees by $667,000,000 over the next six years. According to the Klamath County Chamber of Commerce, nearly 80 percent of all businesses in Klamath County could be negatively impacted by HB 2060 A. Despite the fact that the bill raises well over half a billion dollars in new revenue, Democrats went around the Oregon Constitution’s supermajority requirement and passed the bill on a simple majority vote (All House Republicans and 3 Democrats voted no). Worse yet, this new tax will be levied exclusively on the smallest of Oregon small businesses.

The simple fact is the Oregon does not have a revenue problem, it has a spending problem. Raising revenue on any group when during the past six years state revenue has increased by 40 percent (and we are expected more records in revenue receipts in the next budget cycle), is a gross misdiagnosis of the problem. We all know when there is a misdiagnosis of a problem then all sorts of incorrect solutions will come forward. HB 2060 A is such an incorrect, and unconstitutional, solution.

This bill is more than a difference of opinion. This is a matter of following the laws we legislators swore to uphold and the constitution the people of Oregon expect us to obey.

E. Werner Reschke, a Republican, is the state legislator from House District 56, which includes Klamath Falls and southern Klamath County.



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