This update provides a brief summary of the gubernatorial and state legislative races in Oregon with a forecast for the 2019 legislative session.

Governor’s Race

Governor Brown won the state’s most expensive gubernatorial race in history, with 50 percent of the vote, essentially the same percentage she captured in 2016 when she ran to complete the unfinished term of her predecessor, Governor John Kitzhaber.

Brown carried the same seven counties she carried in 2016 – led by Multnomah County where she captured a 50-point margin (74% to 22%) over State Rep. Knute Buehler, the Republican candidate.  For a map of the gubernatorial race results by county: https://gov.oregonlive.com/election/2018/general/governor/

 

Legislative races

Voters provided Democrats in both chambers of the legislature with “super majorities” – enough votes to pass tax increases on a party line vote. It is important to remember that “party line” votes are not ideal in passing legislation, and can be elusive especially when tax increases are involved. Senate membership will change by only two members. Sen. Alan DeBoer (R-Medford) chose not to run after serving two years in the Senate, and will be replaced by Democrat Jeff Golden. Former State Rep. Shemia Fagan defeated fellow Democrat Rod Monroe (D-Portland) in the May primary and went on to be elected to fill his seat in the general election.

In the Oregon House, the Democratic majority grew by three members, from 35 to 38, with the defeat of incumbents – Reps. Julie Parrish (R-Tualatin/West Linn), Richard Vial (R-Scholls) and Jeff Helfrich (R-Hood River). All of the seats vacated by Republicans who are retiring this year remained in Republican hands.

The resulting 38-22 margin is the largest Democratic majority in the House since 1975 when they held 39 seats. (While many of the Democrats “back then” were from the Willamette Valley and Portland, they also came from Roseburg, Heppner, and Lebanon.) Overall, with the retirement of seven incumbents, 17% of the House membership will turnover from the 2017 session. For a complete summary of legislative races: https://gov.oregonlive.com/election/

 

Prognosis

The increased diversity and the large Democratic margin in the House will likely contribute to increased tension and differences between the two chambers even though Democrats control both chambers.

Oregon lawmakers will face significant, structural budget challenges as they enter the 2019 legislative session. At least three factors contribute to the structural imbalance: sustaining the Public Employee Retirement System (PERS), sustaining health benefit programs for state employees, and meeting increased Medicaid costs.

In a series of meetings and listening sessions across the state, the Joint Committee on Student Success has sought to build the case for increased revenues to support K-12 schools. While this effort may ultimately elicit the necessary 3/5 majority needed to pass a tax increase, it is unclear whether, or how, increased funding might flow to Oregon’s public universities.

In addition, the state’s continued heavy reliance on income taxes as the primary source of state revenues may leave Oregonians particularly vulnerable if/when the national economy falters.

 

What Happens Next

The House Leadership announced changes earlier this fall in some key committee line-ups, including naming Rep. Dan Rayfield (D-Corvallis) as Co-Chair of the Joint Ways and Means Committee. The Senate has yet to name a replacement to chair the budget writing committee with last year’s departure of Sen. Richard Devlin (D-Lake Oswego).

We expect Governor Brown will issue a recommended budget for the 2019-21 biennium the last week of November. Over the last several months, University Presidents, students and faculty have urged the Governor to adopt the HECC’s recommendation for a $180 million increase in funding for the state’s public universities. These included letters from OSU student and faculty leaders, and student members of OSU budget committees.

Legislative committees will meet in Salem December 12-14 to consider issues that will likely arise during the 2019 session. Members will also be working the hallways in search of co-sponsors of bills they are proposing for the 2019 session. On Thursday, December 13, the Beaver Caucus will be holding a legislative advocacy day to begin to familiarize legislators with OSU’s legislative priorities.  More information can be found on the Beaver Caucus website.

Committees will meet again during the week of January 14. On Tuesday January 22, the legislature will convene for the 160-day session. We have established two lobby days during the session to promote OSU’s legislative agenda:

• OSU Statewides Day: Monday, March 18, 2019
• OSU Day: Wednesday, April 17, 2019

We anticipate many additional opportunities for stakeholders and advocates to meet with legislators throughout the session.

 

A Preview of OSU’s Legislative Priorities

Operating Budget

• The seven public universities have sought at least a $130 million increase in operating funds from the current biennial appropriation of $737 million, for a total investment of $867 million. This request would enable tuition increases at all Oregon public universities to stay below 5% per year over the next two years. In August, the HECC recommended to the Governor a $186 million increase in operating funds, for a total of $923 million. The HECC recommendation is obviously a significant improvement and would enable meaningful investments in student success and access while keeping tuition affordable.
• Yet to be determined amount increase in funding for the Oregon Opportunity Grant (OOG), supported by all seven universities. The HECC recommended a 69% increase in the OOG, which provides need-based grants to Oregon students, from $146 million during the current biennium to $247million for the 2019-21 biennium. The HECC’s recommendation would increase the award amount by about $600 per student and increase the number of students served. This would allow OSU to offer the Bridge to Success full scholarship program to more students and enable increased institutional resources.
• $30 million increase for the three Statewide Public Service Programs (Extension, Agricultural Experiment Station & Forest Research Laboratory). The OSU Board of Trustees supported this effort at their October meeting.
• $17.3 million for University Innovation Research Fund ($10 million) and Oregon Corps Program ($7.3 million) proposed by the Oregon Business Development Department for its budget (supported by Oregon’s four major research universities)
• $1.6 million in state match for the US Department of Energy marine energy grant (pending university, industry and philanthropy matches) to design and construct a wave energy testing facility off the Oregon coast. This is the second part of a $4.6 million state matching request. $3 million was allocated to the project in the 2018 session with a budget note that indicated $1.6 million in state contribution would be sought during the 2019 legislative session.

 

Capital Projects

• Shared Capital Renewal Fund: $65 million in state bonds for deferred maintenance to be distributed among all seven universities based on a yet-to-be revised Higher Education Coordinating Commission (HECC) formula (supported by all seven universities).
• OSU-Cascades Student Success Center: $12 million in state bonds, matched by $5 million in student-approved fees.
• Arts & Education Complex: $35 million in state bonds, matched by an additional $35 million in donor funds.
• Cordley Capital Renewal: $28 million state bonds for Cordley Hall Renovation matched with $28 million in university funds (second phase).

 

Policy Issues

Oregon State University is not seeking any specific policy bills. We will be closely following the “Clean Energy and Jobs” bill, currently under development by the Governor’s Carbon Office and the Legislative Joint Committee on Carbon Reduction. While our primary interest in this bill is to ensure that legislative decisions are informed by science, we are also mindful that state carbon legislation may affect university costs or operations.

We will work with the six other public universities and community colleges to track and respond to legislation that may affect students and our academic, research, and outreach responsibilities and programs.