Business
AgLife
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Thursday, February 10, 2022
The Observer & Baker City Herald
Earnings
growth boosts
status of
Oregon public
pensions
Unfunded liability for 2021
estimated at either $19.7
billion or $14.4 billion
SALEM — Oregon’s projected
unfunded liability for public pensions
apparently shrunk significantly last year,
mostly attributable to healthy investment
earnings that pushed the fund past the
$100 billion mark for the first time in its
75-year history.
A final accounting will come later this
year, but preliminary numbers for 2021
peg the unfunded liability at either $19.7
billion or $14.4 billion, depending on
whether “side accounts” are excluded or
included. Side accounts are amounts of
money that participating governments set
aside to cover part of their future pension
liabilities, but not all of the 900 govern-
ment employers in the Public Employees
Retirement System have set up such
accounts.
The comparable figure for 2020 was $28
billion.
The PERS fund was at $85.4 billion in
December 2020; the preliminary figure
one year later is $100.4 billion. Its invest-
ments go beyond common stocks, which
PERS started back in 1973, to other things.
Oregon has one of the nation’s largest public
pension funds.
“It’s a good marker to know what the
investment returns of last year did,” said
Scott Preppernau of Millman, the firm that
does the actuarial work for the system, in a
Jan. 31 report to the PERS board. “Clearly
a strong asset year makes a significant
improvement in these results over a one-
year time frame.”
A decade ago, under then-Treasurer Ted
Wheeler, the Oregon Investment Council
changed its strategy so that the PERS fund
will not grow as much when financial mar-
kets surge, but also does not drop as much
when markets plunge. The change emerged
after the Great Recession, when the PERS
fund lost 28% of its value as it declined
from $66 billion in December 2007 to a low
of about $48 billion in March 2009. It took
several years for the PERS fund to get back
to its pre-recession level.
PERS Board Chairperson Sadhana
Shenoy said Oregon’s long-term liability for
public pensions hasn’t gone away, given that
the funded status of the system is still below
a target of 90%.
“We have a long way to go,” she said.
“But this shows that one good year gives us
a little bit of respite.”
Rate-setting is next
The valuation of the PERS fund as of
Dec. 31 will be a factor when the board
sets pension contribution rates for the 900
participating governments for the 2023-25
budget cycle, which starts July 1, 2023. The
board will likely set those rates at a Sept.
30 meeting.
However, the current average rate of
17.9% is likely to be maintained, instead of
reduced. The board changed its policy last
year so that increasing the funded status of
the system to a specified target of 90% takes
priority over lowering contribution rates.
The “average rate” is a misnomer,
because no participating government pays it.
Rates are determined by the mix of
employees within a government agency,
based on when they were hired and
whether they are classified as public safety
employees, who qualify for higher pen-
sions upon retirement but also require
higher rates than other employees
for pension contributions. State law
defines “public safety employees” for
pension purposes.
Rates tend to be higher for govern-
ments with a greater share of employees
hired before August 2003 — although those
numbers have declined because of retire-
ments — or those with more public safety
employees, such as police, sheriff’s deputies
and firefighters.
Of the 228,000 public employees covered
by the system as of mid-2021, PERS reports
that more than 162,000 of them were hired
after the Oregon Legislature overhauled the
system in 2003. The rest, all hired before
then, fall into more generous defined-benefit
plans from prior years.
But of the 156,500 retirees as of the end
of 2020, most of them (130,000) get bene-
fits under a pre-1996 plan and are classified
as Tier 1. Another 18,000 get benefits under
See, Pensions/Page B2
Ready
to deal
Davis Carbaugh/The Observer
Jacob Brown, owner of the new La Grande Poker Room, poses for a portrait in the lounge of his business on Friday, Feb. 4, 2022.
La Grande Poker Room focuses on social
and entertainment aspect of gambling
By DAVIS CARBAUGH
The Observer
LA GRANDE — La
Grande’s new social gaming
site is up and running.
Jacob Brown, owner of
La Grande Poker Room, 211
Fir St., opened the business
on Friday, Feb. 4. The poker
room is aiming to focus on
the social gaming aspect of
gambling, while providing
another entertainment option
in La Grande.
“The feedback has been
super positive,” Brown said.
“It’s something that La Grande
can use, another form of some-
thing fun to do.”
Brown, who is from La
Grande, purchased the space
in October and renovated it
to hold three full-size poker
tables. La Grande Poker Room
can host up to 27 total players
at one time, nine per table.
According to Brown, the plan
is to host weekly tournaments
and nightly cash games. The
business will primarily host
poker games, but cribbage and
other games could be a possi-
bility if players choose.
The business owner was
inspired to open the poker
room during his time going to
school out of the area, when
he took up social gaming as a
hobby. The absence of a social
gaming spot in Union County
motivated Brown to open
the location in La Grande
after seeing what was offered
in Medford.
“Medford has four social
clubs, so I would go down and
play and whatnot,” Brown said.
“That’s kind of how I found
out about social clubs.”
The closest social gaming
sites to La Grande currently
are in Ontario and at Wild-
horse Resort and Casino in
Pendleton. When he began
pursuing opening the busi-
ness, Brown said he received
interest from Baker and Wal-
lowa counties.
“I thought it would be a
good idea to open one here in
La Grande,” Brown said.
La Grande Poker Room will
offer $1-$2 cash games on a
nightly basis, and tournaments
will be scheduled based on
local interest.
“We’re going to adjust it
to what people want,” Brown
said. “Right now, I’m hoping
that we can do a tournament
every week.”
Davis Carbaugh/The Observer
La Grande Poker Room’s logo adorns one of the poker tables at the new
social gaming business on Friday, Feb. 4, 2022.
The journey to open the
business’ doors included
jumping through the necessary
hoops, including renovating
the space and qualifying for
required permits.
Since acquiring the building
in October, Brown added new
carpeting and opened up the
main playing area. He also
removed a stage that was there
and added a back room where
the stage used to be.
“Pretty much everything
in here is brand-new,” Brown
said.
The business owner had
to appear in front of the La
Grande City Council twice
in the buildup to La Grande
Poker Room’s opening. At a
regular session last September,
the council approved updating
the city’s social games bet
limit to allow for no-limit
poker.
Brown explained that the
city previously enforced a
$5 bet limit, which does not
reflect trends in the poker
community.
“When they made the rule
in 1992, poker then was more
synonymous with limit poker,”
Brown said. “Since 2003,
poker is typically no-limit.”
See, Poker/Page B2
Food industry must adapt to labor shortages, experts say
By MATEUSZ PERKOWSKI
Capital Press
Mateusz Perkowski/Capital Press
Participants examine food processing equipment at Food Northwest’s
recent processing and packaging expo in Portland.
PORTLAND — The
worker shortage isn’t a tem-
porary trend that farmers and
food processors can hope will
soon blow over, experts say.
As insufficient labor plagues
the agriculture and food indus-
tries, employers must per-
sistently compete for workers
while investing in automation,
according to experts at Food
Northwest’s recent annual pro-
cessing and packaging expo in
Portland.
“This is the new normal.
Things will not go back
to how they were before,”
said Osvaldo Granillo, sales
director with Redzone Pro-
duction Systems, which
helps companies with worker
productivity.
Retaining employees is
key — apart from the expense
of recruiting and training
workers, companies face an
“opportunity cost” when they
can’t fill orders due to an insuf-
ficient workforce, he said.
Employee retention doesn’t
just boil down to spending
more on wages, especially with
the new generation of workers,
Granillo said.
A survey of young workers
found that pay rates are 14th
on their list of concerns, while
enjoying their job is the top
consideration, he said.
“Employees are becoming
the new customers. We have to
make them happy,” said Steve
Childs, a production manager
for Chaucer Foods in Forest
Grove. “Employees aren’t
something you do once and
then put on a shelf.”
Roughly 70 million workers
from the “baby boomer” gen-
eration are projected to retire
during a time period when
only 40 million new workers
will enter the workforce,
said Brian LaPlante, dis-
trict account manager with
FANUC America Corp., a
robotics company.
Retirements have increased
in the aftermath of the coro-
navirus pandemic, acceler-
ating changes in the workforce
that were already underway,
LaPlante said.
See, Labor/Page B2