Everyone in Oregon has a favorite Uncle Phil. Certainly Phil Knight fills that roll for many Duck fans. But even though I was once Senator Duck with the University of Oregon in my district, I’ve always had an uneasy relationship with that Uncle Phil.
That Uncle Phil has been on my radar screen for years. It all started with union concerns about trade policy, workers’ rights and corporate decisions to move manufacturing overseas. And these days I hold that Uncle Phil responsible for a lot of the angry public PERS (Public Employee Retirement System) perspective. Remember the Bellotti Effect?
When Mike Bellotti retired as athletic director, he didn’t even have a contract with the UO. The university ultimately reported Bellotti’s last year of compensation at $300,000. Ultimately, PERS staff calculated his final average salary at $1.35 million. That resulted in an obscene yearly payout of over $400,000. Why?
Because that Uncle Phil and all the other shoe company owners forced athletic departments to count any endorsement money into the coach’s salary package. They did this to ensure coaches wouldn’t cut their own deals on the side with other shoe companies that weren’t the school-sponsored sneaker. All for that Uncle Phil.
While the Top Ten list of obscene PERS payouts rankles all of us, actuaries will tell you it’s a tiny, minute part of the PERS unfunded liability. But it’s a huge public perception problem. To the extent that any coaches at any Oregon public university or college must add endorsements to their final average salary, that shoe seller should have to pay into PERS!
Anyway, I digress. My favorite Uncle Phil is the current chair of the House Revenue Committee, a job he’s held for the past 10 years. This Phil, Phil Barnhart, started in the House in 2001. We served together during the 2001 and 2003 sessions. He’s one of the most intriguing people I’ve ever met. He’s a practicing psychologist and attorney. And he’s done forensic psychological evaluations for the courts. Smart guy with a passion for public service and a true state revenue junkie. I say that fondly, having served on the revenue committees in both chambers.
When I was up in Salem a few weeks ago, Phil and I went for a walk. I asked him how his gross receipts tax (or “commercial activity tax”) proposal was going. He said prospects were getting worse by the day; he anticipated Gov. Brown, Speaker Kotek and the senate president throwing in the towel. But he wanted a vote, to hold House Republicans responsible for the lack of adequate education funding.
Then with a glint in his eye, Phil said: “I don’t think we need a supermajority to rescind a tax break. We can get $200 million more into the general fund with a simple majority.”
But Phil, bills to raise revenue require 36 votes in the House. Oregonians passed Ballot Measure 25 in 1996 requiring a 60 percent majority in both chambers for any revenue-raising legislation. Phil responded that our courts haven’t been asked to address the question: does rescinding a tax break require the supermajority threshold?
You’ll get the answer to this final jeopardy question in a few months or years. House Bill 2060 passed last week by the slimmest of margins 31-28. All 31 “yes” votes were Democrats. Republicans, of course, went apeshit! I so feel their pain. The inevitable lawsuit will follow.
Republicans have had a rough couple of weeks. First, as we discussed last week, Democrats were successful in passing HB 2391, the health provider tax that will generate $550 million to pay for medical care for the state’s low-income residents and keep Junction City’s state hospital open. That bill required 36 votes, a feat accomplished with one vote from a retiring Republican.
Then my favorite Uncle Phil snuck in House Bill 2060. Democrats argued that this specific tax break had unintended consequences and didn’t produce the jobs it promised when it was part of the “grand bargain” reached between Republicans and then-governor Kitzhaber in 2013. So now, we’ll all wait for the court decision.
That’s the kind of spunk I like to see in Democrats. Rather than totally throwing in the towel after failing to get any Republican support for the commercial activity tax, Uncle Phil just added $200 million to the pot. I’m sure he’s not the only Democrat who dreamed up this scheme. But he’s the only one named Phil. Stay tuned.
Former state Sen. Tony Corcoran of Cottage Grove is a retired state employee.