Cascade Policy Institute

O R E G O N

April 17,2013

We are now halfway through the Oregon legislative session. Cascade has been in the Capitol almost every day, working to limit government and protect your freedom. Unfortunately, this task is like playing the game Whack-a-Mole. Every time we club one bad idea into submission, two more pop up. Those seeking Crony Capitalism handouts or another nannystate regulation are shameless. I f they want it, they demand it. Whether in the Capitol, a debate with a Metro Councilor, or at a city hearing, we are often the only organized voice defending limited government and opposing nanny-state regulations, higher taxes and fees, and crony capitalism. With your support, we at Cascade Policy Institute will be able to continue to provide this voice, push back, and be an advocate for vou. Below are some of the more wasteful pork-barrel spending proposals we hope to stop: The Lane Transit District (LTD) is requesting nearly $16 million in state funding to expand a so-called "bus rapid transit" line (which is not very rapid) to West Eugene. This extension is strongly opposed by property owners along the route who will lose some of their land. This project is completely unnecessary because faster express-bus service could be offered in the existing general-purpose lane. The only reason it is being proposed is that LTD hopes to leverage $75 million in federal funds, which they think of as "free money." The governor is proposing a new agency called the Unmanned Aerial Systems Center of Excellence (UASCE). The mission of this bureaucracy will be to subsidize "research and development and business development for unmanned aerial systems." Apparently, state planners believe building drones will be the "next big thing" for the Oregon economy - i f only the legislature will capitalize it with $2.5 million of public funds to subsidize highly risky start-ups. Even i f such companies become financially successful, I ' m not sure a state-run drone excellence center is something to be proud of. Another proposed new center is being called the PIE/Oregon Storyboard. This outfit would "recruit, train and promote early stage high technology startups in digital

4850 SW Scholls Ferry Rd. Suite 103 ' Portland, Oregon 97225 t: 503.242.0900 f: 503.242.3822 www.cascadepolicy.org info@cascadepolicy.org
T5 S1119

storytelling, video games, film and television industries." The governor wants $900.000 to give away to 20-something hipsters. DriveOregon is seeking an increase from its current biennial budget of $1.2 million to $2.25 million for 2013-15. DriveOregon is the taxpayer-supported cheerleading arm for the electric vehicle industry and has worked to place subsidized electric car charging stations throughout the Willamette Valley. Most of them occupy valuable parking stalls at venues like the Rose Garden and remain unused. I f you've ever seen them and wondered who is paying for them, now you know. You are. The Oregon Built Environment and Sustainable Technologies Center is seeking an increase from its $3.6 million biennial budget to $8.0 million for 2013-15. The goal of BEST is to support "emerging technologies and companies through research and commercialization grants." One could hardly think of a riskier way to allocate taxpayer dollars. We might be better off i f we paid a state bureaucrat to buy Lottery tickets with money appropriated to BEST.

These are just a few of the hundreds of spending requests pending in the legislative appropriations committee. Advocates insist that every project is a "need," not a "want," and rationalize that on a per-capita basis, they only cost taxpayers a few dollars per year. This is the primary way you lose more of your freedom each year - death by a thousand cuts. What is it worth to vou to stop this slow death bv a thousand cuts? Is it worth $50. $100 or $500? Please consider joining us in this fight with your tax-deductible gift todav! I f the outrageous proposals noted above are not enough to convince you, as they say in the midnight infomercials, "But wait, there's more!" Another boondoggle we are trying to wrestle to the ground is the Energy Trust of Oregon. Ratepayers now send more than $320 million every two years to the Trust, which literally has more money than it knows what to do with. While some people or businesses benefit from ETO with subsidized new appliances or retrofit projects, most of us simply pay a utility surcharge each month but never get anything in return. I f you're a customer of PGE or PP&L, you are probably paying a tax approaching 6% of your monthly bill. I f you're a natural gas customer, the premium is slightly lower. It's time to repeal these taxes and spin off the ETO as an independent non-profit that raises its budget the old-fashioned way: through voluntary contributions. And then there's TriMeL The Portland transit monopoly has been a financial black hole for decades. Management has made virtually every mistake possible: Operating costs are unsustainable, capital costs for rail projects are roughly 1.000 times greater than comparable bus routes, and debt service on bonds is cannibalizing the agency's general fund. Despite the fact that the all-funds budget for TriMet has gone up by 125% since 2005, levels of actual transit service have dropped by more than 14%.

A new member of the legislature, Chris Gorsek (D-Troutdale), has introduced HB 3316, which would change the board of TriMet. Currently, the board is comprised of seven people appointed by the governor. Under Rep. Gorsek's bill, this would be changed to 11 people appointed by various local governments. I have met with Rep. Gorsek to advise him that much more needs to be done, and he is very willing to consider bolder reforms. By the time you receive this, I will have testified at the April 15 hearing, and hope to persuade the committee that TriMet is a failed experiment and needs to be partially dismantled. Most of the smaller cities need to follow in the footsteps of Wilsonville, Sandy, and Canby, which left TriMet years ago and created their own transit districts. These operations are much cheaper and better focused on customer needs. State law needs to be amended to allow cities to leave TriMet at any time, for any reason. We're standing up for PERS Reform and against tax increases. The Democratic majority has announced that it will enact only modest PERS reform, which is being derided by almost everybody as "PERS Lite." The Democratic proposal is much weaker than what Governor Kitzhaber was seeking and thus will require a tax increase to balance the state budget. Since any tax increase needs a 3/5 majority approval in both legislative chambers, Republicans will need to provide two votes on each side. Our challenge between now and June 30 is to ensure that the legislature does not find the 3/5 majority to raise taxes, but we need vour help. The governor's proposed budget for 2013-15 already shows a revenue increase of $1.6 billion over the current biennium. By our definition, this is not a "revenue crisis" as commonly described in the press. Legislators should learn to live within their means, as we all do in our own households and businesses. Certainly, PERS is wreaking havoc with local school districts; and we don't enjoy watching educational programs disappear. But simply raising taxes is not the answer. The problem is that the legislature has steadily enhanced PERS so much that it promises more to retirees than can be delivered. I f the current legislative body doesn't have the courage to cut back some of these promises, there will never be a solution. Over time, rational taxpayers and business owners will simply leave the state rather than serve as cash cows for timid politicians. The truth is, every session of the legislature represents a threat to your property and your civil liberties because legislators always want to "do something" to justify their existence - and "doing something" usually means expanding the reach of government. Our job is to push back, by reminding them that state government is supposed to serve us. not rule us. But we need vour support in order to continue pushing back!

Last week we co-released with our colleagues at Americans for Prosperity-Oregon a detailed blueprint for reform, entitled Facing Reality 2013. This report follows up on several major proposals in our first Facing Reality report presented to the 2011 legislature. Now, we update the cost savings from privatizing liquor distribution and sales, reducing corrections costs down to the national average, eliminating the costly PERS pick-up, and aligning state employee compensation with the private sector. Together, these four proposals alone would save state government more than one billion dollars in this biennium alone, more than countering any claims that we need to raise taxes on hardworking Oregonians and businesses. Facing Reality 2013 also summarized the economic benefits, including 50.000 more jobs within five years, which Oregon would reap by becoming a Right to Work state. Right to Work would allow employees to work, and employers to hire, without letting a labor union get in the way by commanding payments from unwilling workers. Coincidentally, an initiative petition may be circulated soon to grant such freedom to all Oregon public employees. I f that happens. Cascade will be in the forefront of making the economic and moral case for its approval. Constraining big government is an expensive job. It requires extra travel, additional research, and increased costs of printing and postage. I hope you will consider making a generous contribution of $50, $100, $500, or more today, in support of this work. The five-month legislative session only takes place every two years, and we are right in the thick of things. The time for us to make a difference is NOW! If you are able to send a contribution of any size, it will help keep us engaged in the daily battle. Thank you for your generous support. Sincerely,

John A. Charles, Jr. President & CEO PS. With the recent passing of former British Prime Minister, Margaret Thatcher, I am reminded of a quote of hers which, in an often amended form, states, "The problem with socialism is that you eventually run out of other people's money." While we are not a Socialist nation, we are doing a very good job of spending "other people's money." Please consider joining us in stopping the involuntary taking of your financial resources through increased taxation and fees, by giving a voluntary, tax-deductible contribution today. Thank you.