By Vlad Yurlov
Portland values its “green” projects; but local policymakers are attempting to address the region’s homelessness crisis by creating new facilities, rather than repurposing properties that already exist. Cascade Policy Institute has released a new report offering straightforward solutions to aid the unsheltered homeless by using public resources more effectively. Publicly owned and operated buildings should serve as emergency homeless shelters to eliminate the need for illegal camping. Homeless individuals need shelter, and vacant buildings like the Portland Expo Center have the space.
The Expo Center has never generated much revenue, and the property has capital needs that are not in its budget. This makes it a great candidate for Metro’s recent Supportive Housing Services funds, which could redevelop the Expo Center into a shelter. This 330,000-square-foot building sits on 53 acres of land. At 100 square feet per person, the exhibition space alone could shelter thousands of people. The kitchen, restaurant, meeting rooms, and other flexible space could provide the services emergency shelters need. Finally, the massive parking areas could serve as outdoor shelters for tents or vehicles.
To solve Oregon’s homelessness crisis, readily available public buildings, like the Expo Center, should be repurposed as shelter space. Using taxpayer-funded resources more efficiently would both provide emergency relief for the homeless and be a win for the local communities that have already paid for them.
Vlad Yurlov is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.
By Kathryn Hickok
January 24-30 is National School Choice Week, the world’s largest celebration of parental choice in education and the diversity of options available to help today’s students learn. Since 2011, National School Choice Week has affirmed that “every child deserves an effective, challenging, and motivating education.”
“School choice” means empowering parents to choose the education options that are best for their individual children’s needs, goals, talents, and circumstances. Traditional public schools, public charter schools, magnet schools, online learning, private and parochial schools, and homeschooling are all paths to success for K-12 students. Empowering parents to choose among many options can unlock the unique potential of every child. More than half the states in the U.S. currently give families more flexibility to direct their children’s education through educational choice programs including scholarships, education tax credits, and Education Savings Accounts.
As Oregon works to reopen schools during the COVID-19 pandemic, it is especially urgent that policymakers recognize that each family needs to find the right fit for their student to learn effectively and safely. All options should be valued, and education policies should promote parents’ ability to choose among them to help their child succeed.
Kathryn Hickok is Executive Vice President at Cascade Policy Institute, Oregon’s free market public policy research organization, and Director of Cascade’s Children’s Scholarship Fund-Oregon program. CSF-Oregon has provided private scholarships worth more than $3.3 million to lower-income Oregon children to help them attend tuition-based elementary schools since 1999
Repurpose money from the Student Success Act to offset the cost to families who have given up work to support their kids’ online learning
By Eric Fruits, Ph.D.
Oregon Department of Education recently announced relaxed guidelines for school reopenings. The new guidelines provide a roadmap for districts in the Portland area and much of the state to roll out in-person instruction for elementary school students. Regardless of the new guidelines, it is looking more likely that many of Oregon’s largest school districts will not return to full-time, in-person instruction for all students this year.
Earlier this month, the presidents of teachers unions representing Oregon’s five largest school districts sent a letter to Governor Kate Brown. The letter demanded all school staff be “fully vaccinated” before schools reopen for any in-person instruction. If all goes well, that means mid-February would be the soonest that schools can reopen.
Even if all goes well, be prepared for some moving goal posts. Some union representatives are saying schools should not reopen until all students are vaccinated. Because school aged children are the lowest priority population for vaccines, it could be a year or more before they can return to the classroom under this standard.
Meanwhile, extended closures are taking a toll on students. McKinsey & Company found that during the pandemic, students have learned only 67% of the math and 87% of the reading that grade-level peers would typically have learned. The Journal of Adolescent Health published a study comparing the learning difficulties of adolescents with and without attention-deficit hyperactivity disorder after schools closed last spring. The study reports students with ADHD had significantly more difficulties with remote learning than the students without a diagnosis. McKinsey’s research finds a growing racial and socioeconomic achievement gap associated with COVID-19 school closures.
The governor admits her emergency orders have put families with children “in a bind.” Her budget concludes, “One out of six Oregonians…have kids, work in an occupation that cannot be done remotely, and do not have another non-working adult present in the household…these 350,000 or so Oregonians are in a bind. They face the tradeoff between going to work or taking care of their children….”
Families are struggling with bills while parents give up work to manage their kids’ Zoom schools. At the same time, the state projects increased tax revenues. It’s time to compensate families for the sacrifices they are making in the name of public health. When government actions deprive people of their property and livelihoods, the people have a right to compensation. This is especially true during emergencies, when jobs are lost and lives are upended. Shuttering schools has placed an enormous burden on families who have had to give up on job opportunities while spending more money adjusting to online learning.
One way to cover some of the costs to families would pay families for every scheduled day of instruction in which a student’s school is closed to the student for in-person instruction because of a governor’s emergency orders. Compensation could be paid on a sliding scale: $20 a day through fifth grade, $10 a day for middle school, and $5 a day for high school students. The compensation would also apply to “hybrid” school closures, since it would compensate families for days their students cannot attend school in-person. It would also apply to cases in which a governor’s orders close online schools that do not normally provide in-person instruction.
There is a precedent for such compensation. For example, Oregon law provides for compensation for property taken during declared emergencies. ORS 401.192(3) specifies, “When real or personal property is taken under power granted by ORS 401.188 (Management of resources during emergency), the owner of the property shall be entitled to reasonable compensation from the state.”
To be sure, this proposal raises the question of where the money would come from. Last year was the first year of Oregon’s Corporate Activity Tax. The state’s economist predicts more than $1 billion of revenue from the CAT for the 2019-21 biennium. That money is earmarked for “student success.” If we are truly “all in this together,” then now is the time to repurpose those funds to support student success by compensating the families who are giving up so much to help them succeed.
Eric Fruits is Vice President of Research at Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article was published in the Portland Tribune on January 24, 2021.
Press Release: Cascade Policy Institute Offers Straightforward Solutions to Oregon’s Homeless Crisis
January 22, 2021
FOR IMMEDIATE RELEASE
Eric Fruits, Ph.D.
Office: (503) 242-0900
Mobile: (503) 928-6635
Office: (503) 242-0900
Mobile: (503) 807-5978
PORTLAND, Ore. – Today Cascade Policy Institute released a new research report addressing the homelessness crisis in Oregon. Homelessness in the Portland Region: Some Straightforward Solutions to a Complex Problem was authored by Eric Fruits, Ph.D. and Vlad Yurlov. The report provides several recommendations, including:
- Opening unused public buildings as emergency shelters;
- Converting the Portland Expo Center to an emergency shelter with transitional services with funds from Metro’s Supportive Housing Services fund;
- Creating a regional shelter tracking system to identify available shelter space and vacancies.
These recommendations build off principles first laid out by former Mayor Bud Clark more than 30 years ago: Reach out to those who want help, be firm with those who don’t, and create an environment where residents feel safe and businesses can flourish. While there is no single solution to Portland’s homelessness crisis, readily available resources and technologies can provide rapid relief to homeless individuals and restore safety and livability to Portland residents.
During the COVID-19 pandemic, Multnomah County used publicly operated buildings, such as community centers, to help other shelters socially distance. Even so, thousands of homeless people remain unsheltered in the Portland metro area. Cascade Policy Institute proposes using more public buildings to safely and effectively house the homeless in emergency shelter space. Bybee Lakes Hope Center is an example of such a repurposing. In less than a year, Multnomah County’s never used Wapato Jail was converted into transitional housing with space for as many as 500 people.
Building on the success of Bybee Lakes, Cascade recommends Metro, the Portland area regional government, consider converting the now shuttered Portland Expo Center to an emergency and transitional homeless shelter. This 330,000-square-foot facility is built on 53 acres of land with a kitchen, spacious meeting rooms, and plenty of outdoor exhibition space. The facilities can house and serve thousands of currently unsheltered individuals. The timing is right, too. Metro is currently conducting a development opportunity study in search of different and new uses for the event center. Metro’s recently approved Supportive Housing Services income taxes can provide funding for the project.
One of the biggest barriers to sheltering the homeless is also one of the easiest to solve. Currently, the region has no system to track the availability of shelter beds. Cities in California and Washington have developed manual shelter tracking systems and are in the process of moving the systems online.
Portland already has an online system to report and visualize homeless campsite locations. Some straightforward upgrades to the system can provide real-time data on shelter space and occupancy. Simply knowing where space is available is an important first step toward getting homeless residents into shelter.
Report coauthor Vlad Yurlov says, “The first step in housing a person is using a tracking system to find where they can go. Then, publicly owned and operated facilities such as the Portland Expo Center can provide immediate relief to both homeless individuals and the entire community.”
The Portland region has had a decades-long homelessness crisis. Over that time, local governments have embarked on numerous programs to “end” homelessness and spent countless millions of dollars only to see the crisis worsen. This is because government programs have focused on costly and inadequate affordable housing projects. Meanwhile, some of the most straightforward solutions to bring rapid relief have been ignored or dismissed.
The full report, Homelessness in the Portland Region: Some Straightforward Solutions to a Complex Problem, can be downloaded here.
Founded in 1991, Cascade Policy Institute is Oregon’s free-market public policy research center. Cascade’s mission is to explore and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity. For more information, visit cascadepolicy.org.
Some straightforward solutions to a complex problem
By Eric Fruits, Ph.D. and Vlad Yurlov
Every city in the United States has homeless individuals and families. Coastal cities, especially on the West Coast, have numbers of homeless that have hit crisis levels. In addition to the personal toll homelessness takes on the individuals and their families, the spread of unsheltered homeless populations and homeless camps imposes enormous social costs in the form of public health, public safety, and livability for the community at-large.
After decades of attempts to address homelessness—and unknown, but large, amounts of money spent—the crisis seems to have worsened in many places, especially in Portland, Oregon. Since the mid-1980s the region has launched long-range plans to “end” homelessness. All of the plans failed to reach their goals, for many reasons: insufficient funding, political headwinds, legal barriers, and the seeming intractability of solving the problem.
In 2020, the region’s voters approved two new income taxes to provide “supportive housing services” to the homeless and those at risk of becoming homeless. The taxes are anticipated to bring in approximately $250 million a year. During the campaign, proponents claimed, “We know what works, it’s just a matter of scale.” That’s not correct.
To be blunt, we don’t know what works, and there appear to be no economies of scale. For more than two decades, the “Housing First” approach has been heralded as the best solution. The approach focuses first on providing housing to individuals and families, then addressing issues that led participants to homelessness and are keeping them from being housed. These “wrap around” services are expensive and require individuals to have the ability and will to fully use them.
While the approach has improved outcomes regarding the transmission of HIV and the survival of those with HIV/AIDS and has had some success in reducing alcohol abuse, the National Academies of Sciences, Engineering, and Medicine concluded that there is no substantial published evidence to demonstrate improved health outcomes or reduced health care costs. Moreover, there is no evidence that Housing First approaches have had any effect on reducing overall homelessness or the number of unsheltered homeless.
For the community at large, the unsheltered population is the biggest concern. These are the people seen sleeping on the streets, in parks, in tents, in cars, or in abandoned buildings. This population is most quickly associated with filth left in doorways, needles scattered in parks, car prowls, and property theft. While a majority of Portland area voters have compassion for the homeless, they also want an end to overnight camping. They want to feel safe walking down the street or in their parks. They want their city’s businesses to flourish.
Many cities are bound by the Ninth Circuit Court’s decision in Martin v. City of Boise. This ruling prohibits city anti-camping ordinances from being enforced if there is no shelter space available. In addition, the City of Portland is bound by a settlement agreement requiring 24-hour notice before homeless camps can be cleared. The delays associated with the notice requirement means once a camp is reported, it can take the city a week or more to clear a camp.
One way to enforce a camping ban, while complying with Martin, is to develop a database of vacant and available shelter space. If the database indicates space is available, broad laws that prohibit public camping may be enforced. For example, after the Martin decision, Modesto, California implemented a straightforward inventory/vacancy system. Each day, county staff contact emergency homeless shelter providers in the county to track the availability of shelter beds. The information is then distributed to outreach workers and law enforcement officers. Police officers are then able to offer people who are camping illegally a more stable place to stay. As simple as this may seem, neither the City of Portland nor the State of Oregon has such a system.
Because of the COVID-19 pandemic, Portland has increased temporary emergency shelter beds to allow shelters to practice socially distancing. Among other locations, sites have been set up at the Oregon Convention Center, three community centers, a recently abandoned Greyhound bus station, and vacant outdoor land. Cascade Policy Institute proposes the city should continue to pursue making permanent some of these low-cost emergency shelters and camping sites.
In October 2020, Bybee Lakes Hope Center opened its doors as a supportive transitional housing facility for the homeless at the site of the never-opened Wapato Jail in Portland. Along the way, the project faced opposition from local politicians who claim solving homelessness is their main priority. Opponents argued housing people in a former jail was undignified, saying it amounted to merely “warehousing” the homeless. They claimed local zoning laws—which they control—didn’t allow for housing. But, the owner and operator of Bybee Lakes overcame these objections and now the site provides a template for repurposing surplus public land and buildings into facilities to serve the homeless.
Toward that end, Cascade Policy Institute urges Metro, the regional government, to convert into emergency housing the now-shuttered Portland Expo Center. The Expo Center is a 330,000-square-foot exposition facility sitting on 53 acres of land. It has easy access to public transit as a light rail line terminates at the front of the Expo Center and provides frequent service to downtown Portland. The facility needs significant capital investment to remain competitive in the exposition market, but has no identified funding source to meet these needs.
At 100 square feet per person, the site’s exhibition space alone could serve 2,000 to 3,000 individuals. Its 2,500 vehicle parking lot provides ample space for individuals who prefer to camp or sleep in vehicles. Converting the Expo Center could bring immediate relief to thousands of homeless individuals and families while providing a much better return on investment than current plans to remodel the site for low-attendance expositions. In addition, the massive increase in shelter capacity from converting the Expo Center would provide local jurisdictions the opportunity to reduce overnight camping and to clear camps, while remaining in compliance with the Ninth Circuit’s Martin v. Boise ruling.
None of Cascade’s proposals “solve” or “end” homelessness. Instead, they take some big steps toward a coherent framework for addressing homelessness: reach out to those who want help, be firm with those who don’t, and create an environment where residents feel safe and businesses can flourish.
Eric Fruits, Ph.D. is Vice President of Research at Cascade Policy Institute. He is also an adjunct professor at Portland State University, where he teaches course in urban economics and real estate.
Vlad Yurlov is a Policy Analyst at Cascade, specializing in homeless, transportation, and regional land-use planning. He has a Bachelor of Science in Quantitative Economics from Portland State University.
Research assistance was provided by Rachel Dawson and Helen Doran.
By Helen Doran
What does an old industrial site from World War II have to do with your tax dollars? Actually, quite a lot.
Willamette Cove dates back to the early 1900’s as a hub for industrial activity in Portland. Metro bought the property in 1996 from the Port of Portland with the intent of creating a new multi-use trail just minutes away from Cathedral Park, the University of Portland, and multiple neighborhoods.
Twenty years later, you can technically take a walk in Willamette Cove, but you would need to ignore the warning signs, hop the gate, and wear special protective gear. Despite several decades in public ownership, warning signs still call attention to the area’s hazardous levels of contaminants, which include dioxins, metals, and polychlorinated biphenyls (PCBs). These contaminants are known to cause cancer and other adverse effects.
Metro has worked voluntarily with the Oregon Department of Environmental Quality and the Environmental Protection Agency to clean up the area. In 2015 and 2016, the majority of spots hazardous to human activity were removed. Yet, the site does not appear to be any closer to becoming a beloved Portland park than it was in 1996.
Recent action by the DEQ to finalize a cleanup plan prompted Metro to make Willamette Cove eligible for funding from the $475 million in Parks and Nature bonds approved by voters in 2019. The funds Metro will dedicate to the project are for assisting the cleanup process led by the DEQ, but they do not guarantee public access to the site.
Willamette Cove is distinct from many of the regional government’s parks and natural areas and should be prioritized by Metro. Willamette Cove is in the heart of Portland and borders several neighborhoods as well as a university. The convenient location of the site contrasts with the majority of Metro’s parks and natural areas, many of which are outside Metro’s jurisdiction and far from any neighborhoods or public transportation.
Willamette Week reports the area is so convenient that some residents take the risk and walk their dogs along the shore, despite the hazards. The area is also used as a campground by those experiencing homelessness. These activities highlight the need for Metro to restore the area and provide the recreational opportunities requested by the community. Other small-scale projects, such as Killin Wetlands, can wait.
Providing public access to Willamette Cove would revive Metro’s original mission for its Parks and Nature program: to offset the loss of backyards in urban areas with “nature in neighborhoods.” Yet, only 12% of Metro’s land acquisitions are accessible to the public, and over 80% are outside the urban growth boundary.
The 2019 parks and natural areas bond measure does almost nothing to bring parks where they are needed most—within the urban areas in which people live and work. In fact, the largest project funded by the measure, Chehalem Ridge Nature Park, can only be found by car since it is located almost 20 minutes from the nearest TriMet stop. Prioritizing public access to pedestrian-friendly Willamette Cove would be a sign of good faith from Metro that it can shift direction and provide parks within the cities, where taxpayers need them most.
Metro’s Parks and Nature program has needed a reset button for decades. Willamette Cove could serve as just that for taxpayers tired of funding inaccessible natural areas far outside the urban growth boundary. Metro should prioritize the restoration of Willamette Cove and expedite the construction of a multi-use trail. Metro residents have been waiting decades for this type of recreational opportunity.
Helen Doran is the Program Assistant, External Affairs at Cascade Policy Institute, Oregon’s free-market public policy research organization. She co-authored the only independent audit of Metro’s Parks and Nature program, entitled “Hidden lands, Unknown Plans: A Quarter Century of Metro’s Natural Areas Program.”
By Helen Doran
In Metro’s latest quarterly newsletter, “Our Big Backyard,” the reader is invited to agree with Metro’s vision of nature on the condition that he or she keeps off Metro’s properties.
Ways readers can have access to Metro’s “Big Backyard” are glaringly absent from the newsletter. In fact, a better title for the newsletter could be “Our Hidden Lands” because an estimated 88% of Metro’s land acquisitions are inaccessible to the public. Moreover, the parks available to the public emphasize “passive recreation,” which often means no dogs, no playsets, and no picnic spaces.
Metro has a vision for nature that fits specifically with its agenda, not with the needs voiced repeatedly by area residents. Ironically, Metro condemns this micromanaging of nature in its newest newsletter, stating that historically, “Nature often creates very real barriers to access, but more often these barriers are constructed by us” by defining what is “city” and what is “wilderness.”
It’s time for Metro to take its own advice and break down the very barriers to nature it has imposed. Residents want accessible parks with recreational opportunities near residential areas. Metro needs to abandon its agenda of hiding nature and bring it to the people it serves.
Helen Doran is a Program Assistant, External Affairs at Cascade Policy Institute, Oregon’s free market public policy research center.
By Eric Fruits, Ph.D.
With the clock ticking down to midnight on December 31, my family was looking forward to putting 2020 behind us. The New Year held at least a small hope that the pandemic would subside, vaccines would be distributed, schools would re-open, and the chaos and violence would taper off. While the year didn’t kick off the way I’d hoped, I can still dream in what I call my Year of Wishful Thinking.
Operation Warp Speed demonstrated what awesome innovations can be achieved with massive investment and reduced regulatory hurdles. In less than a year, we went from pandemic panic to numerous effective vaccines.
Now, if we can only get those vaccines into people’s arms. With hindsight, it was probably a mistake to put trust in the states to manage the vaccination process. In Oregon, Operation Warp Speed has given way to Operation Equity Lens. The first meeting of Oregon Vaccine Advisory Committee spent a third of its time on “an hour of introductions, sharing of pronouns, expressing words of the day and a Native American prayer” according to the Lund Report. As a result the meeting ran out of time and did not cover key agenda items.
My wish is that the Vaccine Advisory Committee gets moving on putting shots in arms. There is growing evidence that a focus on age is the best strategy for allocating the vaccine. It’s simple, straightforward, and targets the population most likely to die from COVID-19. The next committee meeting should be 15 minutes. “We distribute by age, everyone who agrees, say ‘aye.’” Everyone says, “Aye.” Done. Meeting adjourned, shots go out, the state is vaccinated.
With vaccinations rolling out, we need to focus on reopening the state. People need to go back to work. Businesses need customers. Kids need to be in school, both to learn and to see their friends again. Once a large share of the population is vaccinated, there’s no more reason or excuse for emergency orders shutting down huge parts of the state.
With the re-opening, there will be a reckoning. Residents and businesses will demand that peace, safety, and livability return to their downtowns and neighborhoods. Property owners and utilities will demand back payments. Parents will demand accountability from their schools. State and local governments will demand more and higher taxes. My wish is that the joy of reopening does not devolve into rent seeking and score settling.
The pandemic has provided an opportunity to experiment with deregulation. What we learned is that many regulations do more to stifle opportunities than to protect the public. For example, during the pandemic, the state allows physicians and physician assistants with out-of-state licenses to practice in Oregon so long as they are in good standing in their home state. It seems to be working, let’s make that permanent—and expand it to every occupation. During the pandemic, the state allows restaurant to-go orders to include cocktails. Restaurants have been pushing for to-go cocktails for years. It took an emergency to make it so. Let’s make it permanent.
In my Year of Wishful thinking, I hope state and local governments review their regulations from top-to-bottom to eliminate regulations that do more harm than good.
- As noted above, many occupational licensing laws do little to protect the public. Instead they serve merely to keep people out of the occupation and extract higher prices from consumers.
- Oregon’s certificate of need laws have led to an undersupply of much needed hospital beds in the state. If we had more ICU beds, we would not have needed to shut down as fast and as hard as we did.
- The state’s prevailing wage law was originally designed to exclude non-union and black-owned firms from winning government contracts. “Affordable” public housing costs almost double what privately built housing does and prevailing wages are a big reason why. Without prevailing wage laws, we could be building much more affordable housing.
- In much of Oregon, a student’s public school is assigned by street address and public money flows to the school system rather than the student. We need to flip that system. Send the money to the student and let their family choose which school meets their needs.
- Get government out of the business of being in business. There is no reason for Metro, the Portland area regional government, to be running the Zoo, Convention Center, Expo Center, and solid waste management. There is no reason for the City of Portland to also be the water company. We hate monopolies in the private sector and we shouldn’t tolerate them in the public sector.
The chaos of the first weeks of 2021 makes it difficult to be hopeful. But 95% of the year is still ahead of us. It’s not too late for some dreams to come true in the Year of Wishful Thinking.
Eric Fruits is Vice President of Research at Cascade Policy Institute, Oregon’s free market public policy research organization.
By John A. Chalres. Jr.
Every month when you pay your electricity bill, you pay a surcharge of about 5.6%. If you are a natural gas customer, you pay a similar tax ranging from 2.5% to 4.9%, depending on your vendor. Both taxes are likely identified as a “Public Purpose Charge” (PPC).
That name tells you nothing, which is by design. The proponents of the PPC don’t want you to think about why the tax was imposed or where the money goes, but you should. A lot of it is being wasted.
For example, the Energy Trust of Oregon – which receives over 80% of all PPC funding – spent $21 per million BTU of energy generated in its green power program in 2003, just after the PPC was enacted. By 2019, that cost had gone up to $135, an increase of 532%.
Between 2013 and 2016, Energy Trust also spent PPC funds to subsidize the sale of energy-efficient refrigerators, freezers and washing machines, while encouraging consumers to give the money away to the Oregon Food Bank. Many did, totaling $252,809. That was great for the Food Bank, but every penny was supposed to be used to entice consumers to buy appliances that they wouldn’t have purchased otherwise. The fact that they gave the PPC money away showed that the subsidies were wasted.
The Energy Trust is so well-funded that according to a 2018 audit by the Oregon Secretary of State, ETO spent $26,500 on a “holiday party and employee recognition expenses” for the retirement of its founding CEO.
Public schools also receive PPC funding; and in 2012, Secretary of State Kate Brown released an audit of school conservation expenditures. Her audit showed that at least 333 projects had costs that exceeded benefits. In one case, the Newberg School District installed insulated roofing panels at Mabel Rush Elementary School in 2005 that had a payback of 111 years and an expected life of 25 years. The panels were estimated to cost $84,200, but were only expected to generate $762 in energy savings each year. The measure was estimated to lose $65,150.
The Public Purpose Charge was enacted by the Oregon legislature in 1999 as a modest, 3% tax on customers of PGE and PacifiCorp. It was supposed to go into effect in 2002 and disappear by April 2012. The purpose was to create a small pot of money that could be used to subsidize both energy conservation and renewable power projects.
Instead, it morphed into something much more expensive. Soon after passage, the Oregon Public Utility Commission began coercing most natural gas companies into participating, which was not part of the original law. Then, in 2007, another add-on tax was approved by the legislature to subsidize small energy conservation projects. In that same law, the PPC expiration date was extended from 2012 to 2026.
Since 2002, the PPC has collected more than $2.3 billion from electricity ratepayers. More than 80% of funding goes to the Energy Trust of Oregon, which now has an annual budget of roughly $200 million.
The most cost-effective PPC projects were completed between 2002 and 2012, exactly as the legislature envisioned. By 2019, the cost of subsidizing energy conservation and green power projects had gone up by 73% since the start of the program.
Cascade Policy Institute recently released an analysis of PPC expenditures and concluded that the original, ten-year mission of the PPC has been met. Now in its 19th year, the tax should not be extended again and should be repealed prior to 2026 if possible. Ratepayers are reeling from the effects of the pandemic, and eliminating a combined 10% tax on electricity and natural gas would provide much-needed relief.
John A. Charles, Jr. is President and CEO of the Portland-based Cascade Policy Institute, Oregon’s free-market public policy research organization. A version of this article was published in the Portland Tribune on January 13, 2021.
By Vlad Yurlov
Would you like to have a nice picnic near a garbage dump? How about a meeting? If Metro has its way, these are just some of the frills that will come attached to its newest waste facility. A new transfer station is being planned in Cornelius to expand waste management services to the west side of the region. But instead of providing a functional facility that benefits the region, Metro is pitching expensive features that have nothing to do with waste management, such as meeting spaces, parks, and education centers.
If Metro continues down this path, the new transfer station will have flair instead of function. Waste management debt will be used to fund unrelated goals, while regional improvements still beg for attention. Metro’s systems planning manager says both of the current transfer stations in Portland and Oregon City are “at capacity” and “increasingly costly to operate.” Metro should focus on improving waste management, not adding expensive extras. If the region really needs a new transfer station, there is no room for frills.
Vlad Yurlov is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.
By Rachel Dawson
In the middle of a worldwide pandemic that has decimated local businesses, Portland is proposing millions of dollars in new taxes. Officials recently announced a new proposal called “Clean Air, Healthy Climate” that would impose two separate carbon taxes on large stationary emitters as early as this month.
Portland facilities that produce 2,500 metric tons of carbon or more each year would be charged a “Healthy Climate Fee” of $25 per carbon ton. Approximately 35 Portland area facilities such as Daimler would be required to pay the fee with a minimum charge of $62,500. Officials estimate the fee will generate around $9 million dollars that would fund programs and projects “to meet the City’s decarbonization pathways.” This includes paying for engagement with specified organizations and vulnerable populations, commercial and residential building retrofits, and EV infrastructure, among other things. While these programs seem highly ambitious, specific details and outcomes remain vague or undetermined.
A separate “Clean Air Protection Fee” would apply a tiered fee of up to $40,000 on major facilities generating “substantial hazardous air pollution locally and are therefore required to hold …Air Contaminant Discharge Permits, or Title V Permits.” In 2019 a total of 72 Portland facilities held these specified permits.
The City estimates the Clean Air Protection Fee would bring in around $2 million annually in revenue. That revenue would be used for investments in “pollution reduction programs” with a focus on vulnerable and marginalized communities. Such investments duplicate current pollution reduction programs such as the Portland Clean Energy Fund and the Energy Trust of Oregon.
The City claims the taxes are needed because county data suggest the region is not meeting its self-imposed greenhouse gas reduction goals. Multnomah County data from 2018 show total GHG emissions were reduced 19% below 1990 levels. Portland claims this is “far short of the City’s goal to reduce emissions 50 percent by 2030.” Aside from the fact that there is a mismatch between Multnomah County and Portland area boundaries, the 19% statistic does not tell the whole story.
While Multnomah County emissions have gone down by 19% since 1990, the county’s population level has increased by 39%. Thus, GHG emissions per capita actually have decreased by 42%, a remarkable achievement.
However, these taxes won’t be imposed on the entire population. Only major stationary emitters, such as industrial facilities, will be required to pay them. And since 1990, industrial facilities in Portland have done more than their fair share in reducing GHG emissions. Between 1990 and 2018 total industrial emissions in Multnomah County have decreased by 51% and industrial emissions per capita have gone down by 65%. Instead of punishing industrial facilities by imposing additional fees, Portland officials should be celebrating their success.
In fact, when industrial emissions are taken out of the equation, total Multnomah County emissions have only gone down by 10% since 1990.
These taxes come at a time when many businesses are struggling to keep their doors open and staff employed. Over the past year, Oregon has lost 16,700 manufacturing jobs. As of August, Precision Castparts eliminated 10,000 jobs worldwide due to the Coronavirus, 717 of which were located in the Portland Metro area. Despite the company’s struggle to keep workers on its payroll, Portland’s proposed carbon fee would cost Precision Castparts an estimated $629,494 annually. The company has stated that “significant tax or fee increases would factor into future decisions related to our operations in Portland.”
Additionally, Evraz North America, a global steel company, would pay over $2.7 million annually. Evraz has already cut around half of its Portland area employees since last year.
Instead of fighting climate change, this tax may end up costing Portlanders their jobs.
Other eligible employers include many major hospitals such as Oregon Health & Sciences University, Legacy Emanuel Hospital & Health Center, and Providence Portland Medical Center.
Officials should be supporting businesses hard hit by the pandemic and recession, not taxing them into layoffs. These two carbon taxes will punish a sector that is already making great strides in lowering GHG emissions. Since total industry GHG emissions have decreased to 51% below 1990 levels, the industry sector by itself has already surpassed Portland’s GHG reduction goal. The City of Portland should immediately halt all current and future work on this proposal.
Rachel Dawson is a Policy Analyst at the Portland-based Cascade Policy Institute, Oregon’s free market public policy research organization.
By Rachel Dawson
Oregon couldn’t let a new year commence without the rollout of a new tax increase.
Voters passed Measure 108 last year which increases cigarette and cigar taxes and establishes a new tax on vaping products beginning January 1, 2021.
The measure was approved by 65% of voters, likely because it was painted as an effort to reduce smoking and help low-income Oregonians by directing 90% of funds to the Oregon Health Plan. However, once in practice these new changes will have unintended consequences.
First, the taxes are regressive and will hurt low-income Oregonians. A recent study found that “low socioeconomic status is generally associated with a high prevalence of cigarette smoking.” Smoking prevalence was 41% among men with incomes below the poverty level versus 24% for those with incomes at or above it. It’s absurd that the state is taxing some of the very same people these medical services are supposed to help.
Second, only 10% of raised funds will go to tobacco-use prevention and cessation. It’s clear the purpose of these taxes is to fill a budget hole, not to help tobacco users quit their addiction. The state has created a perverse incentive for itself–the more people smoke, the more money the state brings in. Additionally, e-cigarettes and vaping products, both safer alternatives to cigarettes, will now be taxed. One study found that for every 10% increase in e-cigarette prices, sales dropped by 26%, leading to an increase in traditional cigarette use.
If officials are truly committed to protecting public health by reducing cigarette use, they should allocate a higher percentage of the taxes’ revenue to smoking cessation and prevention programs.
Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research center.