OSWA Legislative Update

Budget Numbers Released
Last week, most state agencies released their "30% Cut List." Legislative budget writers asked agencies to prepare the figures after Governor Kulongoski previously ordered 10% and 20% cut lists proved insufficient as state revenues continued to decline. Each agency's cut list is posted on the web. Oregon State Legislature - Legislative Fiscal Office.

Next week, legislative budget writers will go on the road for two weeks of meetings throughout Oregon. The stated purpose of the meetings is to gauge public reaction to the possible state service cuts. Leaders have stated that the 30% lists are only guides; they will make final budget reductions after public meetings and hearings.

The Department of Forestry's two primary responsibilities, fire protection and Forest Practice Act (FPA) enforcement are both decimated by the 30% reductions due to matching funds from landowners and the federal government. In other words, rather than 30%, the DOF's private land program is facing an 83% reduction. OSWA and OFIC are meeting this week to discuss strategies in the face of the DOF being unable to enforce the FPA. There are an untold number of issues facing the forest products industry should the DOF not be able to carryon FPA enforcement.

For example, would the Department of Environmental Quality, which relies on fees for much of their responsibilities, take over U. S. Clean Water Act enforcement for forest lands? The U.S. EPA is another possibility. Without state assurance of FPA compliance forest product certification would also be threatened.

The impact on the DOF's fire program could also be catastrophic. Fortunately, Oregon's General Fund fire insurance policy for 2009 has already been purchased. With a much reduced fire protection program future year's policies would not be easy obtained. Also, the DOF has a five-year contract with the U.S. Bureau of Land Management to provide fire protection for the 2.2 million acres of BLM land in Western Oregon.

Climate Change
The group of legislators who last week proposed a "hard cap" on carbon-based electricity has pulled back from that version after hearing from Oregon's two major privately owned utilities to the legislators that conservative estimates place the cost of the hard cap at $11.5 billion.

Negotiations with environmentalists and legislators continue. Thus far, business, industry, homebuilders, labor and utilities have maintained unified in their opposition to costly proposals. Instead, the coalition has submitted a plan that achieves real carbon dioxide reductions through energy efficiency and an aggressive carbon reduction strategy for utilities regulated by the Public Utility Commission. Legislators that aren't part of the climate change negotiating team are very concerned over new legislation's potential negative impacts.

Meanwhile, the Senate Energy and Natural Resources Committee is holding a hearing on the proposed climate change plan on April 9 at 3:00 in the State Capitol. Associated Oregon Industries is organizing attendance for their business members. A similar hearing early in the session offered a resounding NO! to Governor Kulongoski's Cap & Trade Bill, despite the Governor's testimony urging adoption.

This Week
4-9       House Agriculture, Natural Resources & Rural Communities will hold a work session (possible action) on fire funding bills HB 2214 and HB 3281.

4-9             Senate Energy & Natural Resources Committee will hold a public hearing on the current legislative proposal for a cap on carbon dioxide emissions.

For the report on OSWA legislation, click on:
OSWA Bill Tracker
Login: OSWA; Password: session09

For more legislative information, click on:
Conkling Fiskum & McCormick Insider Online.