This is the title I chose for my personal blog, which is meant to give me an outlet for one of my favorite crafts – writing – plus to use an image from my favorite sport, golf. Out of college, my first job was as a reporter for the Daily Astorian in Astoria, Oregon, and I went on from there to practice writing in all my professional positions, including as press secretary in Washington, D.C. for a Democrat Congressman from Oregon (Les AuCoin), as an Oregon state government manager in Salem and Portland, as press secretary for Oregon’s last Republican governor (Vic Atiyeh), and as a private sector lobbyist. This blog also allows me to link another favorite pastime – politics and the art of developing public policy – to what I write. I could have called this blog “Middle Ground,” for that is what I long for in both politics and golf. The middle ground is often where the best public policy decisions lie. And it is where you want to be on a golf course.
A major political battle is brewing in Oregon and the debate could go to the heart of what state government means here.
The title is strange: The so-called “kicker law.” But, many Oregonians know about it because it has existed for years and often means regular citizens have more money in their pockets.
If you want to read a solid article on this subject, go to the Oregon Public Broadcasting (OPB) website.
There, reporter Dirk VanderHart writes a long story on the law. His work deserves plaudits as a solid piece of journalism, which, I add, is typical of OPB, the state’s best news and public affairs outlet.
[In the spirit of full disclosure, I was OPB’s lobbyist for more than 10 years in Oregon and my old firm still represents the company.]
Here is the bottom line. All of us can read all we want about the kicker law and other elements of Oregon state government budgeting, but the issue boils down to this salient point: Politics is what matters, not intricate tax and budget detail.
From OPB, here is a summary of the kicker law:
“The kicker is an Oregon institution, triggered whenever personal income taxes and other non-corporate revenue streams come in at least 2 per cent higher than state economists predicted when legislators were building a two-year budget. In those increasingly common cases, all the excess is ‘kicked’ back to taxpayers.
“The law was fashioned in 1979 as a blunt tool to keep state spending in check, but Oregon has never seen anything close to the $5.6 billion refund headed out the door next spring.”
The sheer magnitude of the payout is kick-starting – pardon the play on words — a fresh set of questions in the Oregon Capitol and beyond.
For their part, Democrats are increasingly pointing to the refund to explain why they can’t pay for a growing list of what they call “crises” — housing and homelessness, public defense, mental health, and K-12 education.
Further, the state’s largest labor union is calling out the economists whose consistent underestimations of income tax revenue have sent $10.2 billion out of state coffers over the last decade.
Here is a quick summary of the politics:
- Conservatives, including many Republicans, believe the tax money belongs to taxpayers and, so, if there is more than expected, it should be sent back.
- Liberals, including many Democrats, believe state government – including such programs as K-12 education, higher education, public safety, and social services – needs the money more than taxpayers, so it should be saved for government.
State Senator State Senator Lew Frederick is one of the most vocal opponents of the kicker – and because I know him well from having lobbied him at the Capitol, I report his position.
As a Portland Democrat, Frederick needs little prompting to expound on all the things Oregon could do with the forgone money: From his perspective, fully fund schools, bolster mental health care, pay for road maintenance.
“We have the money,” Frederick said. “It’s not available because of the way we’ve designed the kicker, and because folks have been told that somehow spending it is taking money from them. It’s not.”
Of course, to others, it is – it’s “taking” someone’s money.
A third political issue lurks on the horizon.
A number of years ago, Republicans, concerned that the “spend it all” attitude would prevail, managed to “enshrine” – yes, that is the word that often is used – “enshrine” the kicker law in the State Constitution.
That means it would take a statewide vote of the people to change it or get rid of it, not just legislative action at the Capitol in Salem.
The very size of the kicker this year – OPB says the “state will send a jaw-dropping $5.6 billion back to taxpayers next year” – has ratcheted up pressure on changing the tax policy, despite how much voters may love it.
There is talk around the Capitol that, (a) the state economist, John McMullen, has not done his job well because his estimates on revenue have been so far off, and, thus, he should be let go, (b) it is time for discussions about how to change the law, so government has money for schools and other programs.
An interesting sidelight, at least so far, is that the state’s highest-ranking Democrat, Governor Tina Kotek, has shown no appetite to propose spending kicker money. She has repeatedly declined to entertain the idea of diverting the refund to address her top issues of housing and education – and it would take a vote of people, as explained above, to do that deed.
“That personal income tax relief that will come in next year’s taxes is really important to Oregonians,” Kotek told reporters in October. “If Oregonians want to have a conversation of where the personal income tax kicker goes in the future, let’s have that.”
It may not be smart to bet on politics, but if I was doing so on this issue, I would bet that Oregonians would not vote to get rid of the kicker.
One of the state’s most reputable polling firms, DHM research, says essentially the same thing – 68 per cent of voters want to keep the kicker and only 28 per cent are open to change.
Plus, in the end, most voters will want to keep money in their pockets.