Inside
MEETING NO TICES
See
Page 6
V olume 107
Number 5
Mar c h 17, 2006
P ortland
The great
Tax Shift
Corporations are paying
less and less in state
taxes, leaving workers
to pick up the slack.
By DON McINTOSH
Associate Editor
In today’s Oregon, the only thing
more regular than rain is government
budget-cutting. The price of state col-
lege tuition is up. The number of state
troopers is down. The Oregon Health
Plan is down to bare bones. And pub-
lic school classrooms are getting more
crowded — Oregon now has the sec-
ond-largest class sizes in America.
Meanwhile, little noticed by Ore-
gon residents, the state is collecting
less tax revenue than it used to from its
biggest corporations, and it’s even giv-
ing tax money back to businesses and
individuals in the form of a “kicker.”
Could there be a connection?
Based on the current estimate, the
state will give a tax credit next year of
$205 million to corporations and a tax
refund of $461 million to individuals
— even as the state’s public schools
face a $160 million shortfall, and hu-
man services face a $172 million hole.
That outrages some in the union
movement, like Tom Chamberlain,
president of the Oregon AFL-CIO.
The state labor federation has filed
several ballot initiatives that would
eliminate the corporate kicker, at least.
Now it appears there’s a chance the
Legislature may itself act to get rid of
the corporate kicker.
Oregon is the only state in the na-
tion with a kicker law. The way it
works, a state economist makes rev-
enue projections for a two-year period,
and the Legislature approves spending
based on that prediction. If revenues
end up being more than 2 percent
above projections, the state refunds the
tax money collected. Two-thirds of the
corporate kicker money goes to com-
panies headquartered outside Oregon.
The Legislature meets every two
years in odd-numbered years, but may
call a special session this April to deal
with the budget crisis.
Chamberlain is hopeful that legisla-
tors will refer a ballot measure to vot-
ers in November that would turn the
kicker into a rainy-day fund.
But it’s raining already. Schools in
Multnomah County, for example, are
facing a $100 million shortfall this fall.
And the kicker is only the begin-
ning of the story.
Crisis for education workers
Workers from the Multnomah Educational Service District were joined by community supporters at an
informational picket line March 9 in front of the MESD Administration Building off 116th and Airport Way
in Portland. AFSCME Local 1995 represents about 400 classified employees — a large portion of them are
educational assistants that provide classroom instruction to special-needs students in all Multnomah County
school districts. They have been working without a contract since last July. The union declared impasse Feb.
14 and a mandatory 30-day “cooling off” period expires March 17, at which time the union could give a 10-
day notice to strike. A mediation session is scheduled for March 23. A key issue in the talks is a demand by
MESD to re-define “full-time employee” so that workers have to pay more for their health insurance. “My
take-home pay is $17,500 a year,” said Bill Radford, a 13-year education assistant. “What’s being proposed
would increase my insurance co-pay from $520 to $990 a year. Family coverage would cost even more.”
Another rally is planned at 6 p.m. Tuesday, March 21, the same time MESD’s board of directors meets.
(Turn to Page 2)
Four months ahead of schedule
City unions, Portland reach tentative 4-year agreement
The District Council of Trade Unions (DCTU) has reached a ten-
tative agreement with the City of Portland on a new four-year con-
tract — four months before the current contract expires.
The DCTU is an umbrella organization of seven unions that bar-
gains jointly with the city. The unions are American Federation of
State, County and Municipal Employees Local 189, Electrical Work-
ers Local 48, Laborers Municipal Employees Local 483, Machin-
ists Local 1005, Operating Engineers Local 701, Painters District
Council 5 and Plumbers and Fitters Local 290.
Each of the unions has presented the tentative proposal to their ex-
ecutive boards for review. Some 1,800 city employees will vote on
the pact at separate union meetings to be held later this month. Bal-
lots will be counted jointly on March 31.
Fire Fighters Local 43, the Portland Police Association and the
Bureau of Emergency Communications (Portland metro 9-1-1 oper-
ators who are also members of Local 189) bargain separate contracts
under different timelines.
DCTU and city officials have been meeting informally for several
weeks preparing for what many assumed would be difficult bargain-
ing. Instead, the two sides were able to reach agreement during the
informal meeting stage.
That’s a 180-degree turn from previous bargaining. In 2001, city
employees embarked on a brief (four-hours-in-the-middle-of-the-
night) strike four months after their old contract had expired. Health
insurance was at the heart of that dispute.
In 2004, the contract was extended for two years, which got it to
this point.
Labor’s top issue in 2006 again was affordable health insurance.
For nearly a decade, a reserve fund (built up in the early ’90s when
insurance premiums were flat) has paid for the portion of employees
premiums that exceeded a negotiated cap.
“We’ve been living off that reserve for more than eight years,”
said Richard Beetle, business manager of Laborers Local 483, which
represents 585 city employees. “Everyone knew the subsidy could-
n’t continue.”
With the reserve fund nearly depleted and future costs of health
insurance unpredictable, the sides expressed their concerns and ex-
pectations during the informal meetings. At a meeting in late Febru-
ary, the city presented DCTU with a proposal: A four-year contract
— beginning July 1 and running through June 30, 2010 — with the
city paying 95 percent of the health insurance premium costs for
medical, dental and vision insurance for either City Core or Kaiser
coverage; annual cost-of-living (COLA) raises based on the area
Consumer Price Index, with a guaranteed 2 percent minimum and a
maximum of 5 percent, regardless of the CPI numbers; all Public
Employees Retirement System language in the contract would be
updated to reflect current language in Oregon law, some of which
was changed by the 2003 Legislature and subsequent court cases.
All other language in the contract would remain the same.
The actual dollar amount that employees pay for their health in-
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