Editorial: The grand bargain was no bargain

The Oregon Legislature’s special session was called the grand bargain.

It was arguably a grand accomplishment to get the package of five bills passed in a quick session. It’s not clear the package was a bargain.

Schools are happy, and there’s no denying they are helped.

There’s $100 million more for K-12. The state’s Deputy Superintendent Rob Saxton says $100 million means 500 additional teachers or 2.5 additional school days for the entire state.

Community colleges got $15 million and other higher education institutions got $25 million. That money should enable them to keep tuition from increasing.

But will the Legislature be able to sustain that commitment? That’s not clear.

There were also changes to the state’s Public Employees Retirement System called PERS. The package reduced cost-of-living adjustments for retirees. Together with the PERS reforms passed by the Legislature in the regular session this year, the PERS changes could maybe save the system more than $5 billion in long-term liabilities. And it’s a big maybe.

The courts could wipe out much of those savings. That unravels the bargain.

Gov. John Kitzhaber also said after the session ended that the “Public Employees Retirement System is off the table for this governor. We are done. We are going to move on to other things that are important to Oregonians.”

His declaration may make the reforms or the governor more palatable to PERS employees. It’s strikingly premature to say no more work is needed on PERS before there have been any rulings by the courts.

Then there’s the point about the special session PERS changes raised by State Sen. Tim Knopp, R-Bend. He noted that the reforms raid the PERS contingency fund to make supplemental payments to people who get their cost-of-living adjustments reduced. The contingency fund is there, in part, to protect the system against lurches in investments. You know, like the ones that have contributed to its $14 billion shortfall.

The supplemental payments may only add up to $65 million over the next several years out of the contingency fund’s $600 million. But that means that as the PERS reforms are supposed to be positioning the system for the future, they are doing it in a way that reduces Oregon’s ability to deal with future uncertainty.

That’s a bargain?

There’s also already worry that the grand bargain’s new hastily erected tax breaks will become the new BETC — shorthand for Oregon’s Business Energy Tax Credit program that had enough loopholes to make it an multi-million dollar embarrassment.

So we’re sorry. We can’t join in the self congratulations that Democratic and Republican leaders churned out after the session. Many of them were delighted that Oregon government was able to pass legislation in stark contrast to what was going on in Washington.

It’s a lousy measure for accomplishment.

The Oregon Legislature’s special session was called the grand bargain.

It was arguably a grand accomplishment to get the package of five bills passed in a quick session. It’s not clear the package was a bargain.

Schools are happy, and there’s no denying they are helped.

There’s $100 million more for K-12. The state’s Deputy Superintendent Rob Saxton says $100 million means 500 additional teachers or 2.5 additional school days for the entire state.

Community colleges got $15 million and other higher education institutions got $25 million. That money should enable them to keep tuition from increasing.

But will the Legislature be able to sustain that commitment? That’s not clear.

There were also changes to the state’s Public Employees Retirement System called PERS. The package reduced cost-of-living adjustments for retirees. Together with the PERS reforms passed by the Legislature in the regular session this year, the PERS changes could maybe save the system more than $5 billion in long-term liabilities. And it’s a big maybe.

The courts could wipe out much of those savings. That unravels the bargain.

Gov. John Kitzhaber also said after the session ended that the “Public Employees Retirement System is off the table for this governor. We are done. We are going to move on to other things that are important to Oregonians.”

His declaration may make the reforms or the governor more palatable to PERS employees. It’s strikingly premature to say no more work is needed on PERS before there have been any rulings by the courts.

Then there’s the point about the special session PERS changes raised by State Sen. Tim Knopp, R-Bend. He noted that the reforms raid the PERS contingency fund to make supplemental payments to people who get their cost-of-living adjustments reduced. The contingency fund is there, in part, to protect the system against lurches in investments. You know, like the ones that have contributed to its $14 billion shortfall.

The supplemental payments may only add up to $65 million over the next several years out of the contingency fund’s $600 million. But that means that as the PERS reforms are supposed to be positioning the system for the future, they are doing it in a way that reduces Oregon’s ability to deal with future uncertainty.

That’s a bargain?

There’s also already worry that the grand bargain’s new hastily erected tax breaks will become the new BETC — shorthand for Oregon’s Business Energy Tax Credit program that had enough loopholes to make it an multimillion-dollar embarrassment.

So we’re sorry. We can’t join in the self congratulations that Democratic and Republican leaders churned out after the session. Many of them were delighted that Oregon government was able to pass legislation in stark contrast to what was going on in Washington.

It’s a lousy measure for accomplishment.