In its fourth week, legislative budget writers issued a final packet of allocations and redistributions that spread a portion of the state’s projected ending fund balance among a handful of special projects and activities.

Sine die – which in Latin means adjournment without specifying a date for further meeting – could be as early as Tuesday, though more likely on Wednesday, and possibly as late as Thursday, depending on how long it takes for legislators to churn through the bills that remain “in play.”  Republicans in both chambers have slowed the process by not voting for routine motions to “suspend the rules.”  Without a suspension of the rules, the entirety of all bills considered on the floor must be read aloud before legislators can conduct a floor debate and vote.  For most measures considered last week, the majority of the time spent was in reading the bills, rather than in the debate and voting.

For an overall update on the session, see recent articles in the Oregonian and Statesmen Journal.

* * * * * * *

Higher Education Initiatives

University Venture Development Fund Tax Credit: HB 4072 would extend the UVDF tax credit for six years, enabling donors to receive tax benefits for contributions to a fund that supports the transition of university inventions from the laboratory to the marketplace. UPDATE: On Friday, by a 5-0 vote, the Senate Finance and Revenue Committee approved the bill and sent it the Senate floor with a “do pass” recommendation. The bill may be considered as soon as Monday.

University Investments in Equities: HJR 203 is a constitutional amendment referred by the legislature for consideration on the November 2016 ballot. It would enable universities to invest funds in common stocks. UPDATE: The bill passed the House by a vote of 55-1 and last week was approved by the Senate Rules Committee and is now headed for a vote on the Senate floor.

Lodging Tax: HB 4146 as introduced would double the statewide “transient lodging tax” from one to two percent. In the initial years the increase would support activities associated with 2021 international track and field championships to be held in Eugene. Because of OSU’s close proximity, our track & field facilities are likely to be involved as a potential venue, and may ultimately qualify for investments that will likely be under consideration during the 2017 legislative session. UPDATE: The House approved a revised proposal that reduced the rate.  The bill is now under review by the Senate Finance and Revenue Committee which is considering a number of additional amendments.  If the Senate adopts changes and passes the bill, it will need to return to the House for concurrence with the Senate amendments. Given the impending adjournment, bill supporters have little time to complete work on this bill.

Appropriations Actions

Increased Funding for Universities: Universities entered the session seeking at least a portion of the additional $55 million needed to bring them to the $755 million target sought during the 2015 legislative session. UPDATE: Adjustments to the biennial budget did not include any additional operating funds for Oregon’s public universities.

Marine Energy: Members of the bi-partisan Coastal Caucus sought $1.5 million for the research and development of marine energy on the Oregon coast. $1.25 million of this funding would enable OSU to compete for a $5 million federal grant. UPDATE: The Joint Ways & Means Committee approved $800,000 for this purpose included in SB 5701, the biennial budget rebalancing bill.  How OSU will approach the US DoE will depend on the solicitation for proposals that is expected sometime this spring.

ALS Endowment:  Included in the final budget bill is a one-time $100,000 allocation that will enable the OSU Foundation to create and manage an endowment to provide scholarships for students involved in research addressing amyotrophic lateral sclerosis (ALS).  The funding is in honor of State Rep. Vic Gilliam (R-Silverton) who was recently diagnosed with ALS.

Endophyte Research:  SB 5701 also appropriates $100,000 for endophyte research, to be matched by private dollars.  “These funds are to be used only for endophyte research in support of Oregon’s fiber and straw export industry. A report to the Legislative Fiscal Office on how the funds were used in support of endophyte research and what was made possible by this additional influx of funds should be made by December 31, 2016.”

Continuing Service Level (CSL):  The final budget also included a budget note that directs the Department of Administrative Services (DAS) and Legislative Fiscal Office (LFO) to develop, in consultation with the Higher Education Coordinating Commission and the seven public universities, an estimated cost of applying the Community College Support Fund model to the Public University Support Fund, the Agricultural Experiment Station, the Extension Service, the Forest Research Laboratory, and Public University State Programs.  The estimate will include data elements that the public universities will be required to submit to HECC in order to implement the model. DAS and LFO will provide the estimated cost to implement the Community College Support Fund CSL model for Public University state support to the Emergency Board, through the Legislative Fiscal Office, by July 1, 2016.

If acted upon by the Governor and the legislature during the 2017 legislative session, Oregon’s public universities and the OSU Statewide Public Service Programs may face budgetary increases that more accurately reflect the true cost of increases associated with the Public Employees Retirement System (PERS) and other costs that were not included in the calculations that were used in the creation and adoption of the 2015-17 budget.

Industrial Hemp: Although budget writers did not approve funding for industrial hemp research to be conducted at OSU, the legislature approved HB 4060, which revises and clarifies state statutes involving the cultivation of industrial hemp.

Additional funding for Oregon Promise: The Ways & Means Committee approved an additional $1.7 million for Oregon’s “free community college” program to fund additional support services at Oregon’s 17 community colleges.  The additional funding was taken from a prior, unused, appropriation for accelerated learning and will be distributed by the Higher Education Coordinating Commission. “Each community college will get one share of the funds, except Portland Community College will receive three additional shares given its size and operation of four major campuses.”

Capital bonding for Universities:  The Ways & Means committee approved bonding for five capital projects sought by Portland State University, Southern Oregon University and Oregon Institute of Technology.  The projects had been reviewed and approved by the Higher Education Coordinating Commission and include:

• $5 million in XI-Q bonds for OIT to repair infrastructure failures in the North Utility Corridor Electrical Supply Feed and the College Union Building Storm Drainage System.
• $5.1 million for Article XI-F bonds for PSU to purchase the Corbett Building in Portland, which PSU currently leases from its Foundation for use by its Business Accelerator program.  (The legislature also reduced bonding for a housing project at PSU that is expected to be lower than projected when originally approved.)
• $1.5 million in Article XI-F bonds for SOU to construct a new building for Jefferson Public Radio (JPR), adjacent to the university’s Center for the Arts facility in Ashland; and
• $2 million in Article XI-Q bonds for SOU to expand the scope of the McNeal Pavilion project initially approved by the legislature in 2014 for deferred maintenance and seismic upgrades. The additional funding will allow the construction of a new competitive gym for intercollegiate basketball and volleyball programs.
• $1.7 million in Article XI-F bonds for SOU to finance energy improvements to be included in the Science Building deferred maintenance project approved in 2011.

Establishment of a Legislative Policy and Research Committee:  Budget writers approved SB 1569 which establishes a Legislative and Policy Research Committee which will oversee and direct an increased capacity in the legislature for conducting research and policy analyses.  Under amendments adopted by the Senate Rules Committee, the Committee will consist of an equal number of House and Senate members and Democrats and Republicans.  Given the interest in collaborating with the legislature on policy matters four universities (including OSU) wrote in support of the bill.

Other Higher Education Bills of Note

SB 1540  Calls on the HECC and universities to determine the best method of increasing number of mathematics majors at Oregon universities. UPDATE:  After approval by the Senate (27-1), the House by a vote of 53-0 approved the bill and sent it to the Governor for her signature.

SB 1558  Limits disclosure of records of college or university student health center, mental health center or counseling center, or records of health professional retained by college or university.  UPDATE:  After the Senate passed the bill (28-0) the bill passed the House on a 53-0 vote.  The bill now awaits the Governor’s signature.

SB 1586  Requires universities to undertake a number of activities to encourage students to register to vote. The seven public universities submitted a statement in favor of the bill, with amendments. UPDATE:  The Joint Ways & Means Committee amended the bill and removed provisions that would have required the state to carry the cost of postage paid envelopes for future ballots.  The bill is awaiting a vote on the Senate floor.  It will then go to the House.

HB 4019 Requires universities to provide in-state tuition to dependents of Oregon residents who leave the state to serve in public service organizations. UPDATE:  This bill passed the House (59-0) and was approved in the Senate on a 28-0 vote.  It awaits the Governor’s signature.

HB 4021 Directs the State Treasurer to study possible refinancing mechanisms for student loans. The seven public universities submitted a statement in favor of this bill. UPDATE:  This bill was passed by the House (54-6) and last week was approved by a vote of 29-0 in the Senate.

If you have questions about this report or any state legislative issues contact jock.mills@oregonstate.edu.