More Economic Development Transparency in Oregon

Published June 20, 2011

Oregon lawmakers have unanimously approved a measure requiring state agencies to post information about Oregon’s economic development tax incentives on the state’s transparency Web site.

House Bill 2825, sponsored by State Reps. Phil Barnhart (D-Eugene) and Kim Thatcher (R-Keizer), requires disclosure of the names of companies receiving tax dollars through economic development programs; the amount of tax incentives received; deliverables promised in return for tax incentives; and whether those deliverables were met.

“First, we started with a bipartisan approach with support from both business groups and public employee unions, as well as from taxpayer and public policy watchdog organizations,” said Thatcher. “Second, we worked with various state agencies to ensure there would not be additional cost to the state in providing the reports about tax breaks for economic development to the state’s transparency Web site.”

Initial Resistance
The bill drew some concerns from business lobbyists when first introduced. Business lobbyist Jim Craven initially testified against it.

“One of the original objections was that the bill’s language seemed to presume that the administrating agencies would evaluate business incentives on new rationales, rather than on the statutory rationales already used in granting different incentives,” he said. He also asked for clarification that nothing in the bill repealed existing Oregon law that protects from disclosure of proprietary information.

This problem was fixed with changes to the bill to address Craven’s concerns.

$350 Million in Two Years
Jon Bartholomew, advocate for Oregon State Public Interest Research Group (OSPIRG), which played an important role in rolling out the idea for the bill, said it will give the legislature a chance to check wastes of taxpayer money.

According to OSPIRG research, Oregon taxpayers spent approximately $350 million in the last two years on business subsidies to aid economic development, and there has been no real way of measuring whether the spending has been successful.

Dubious Benefits
Thatcher agrees with that skepticism about the usefulness of business subsidies.

“The state spends a lot of time picking winners and losers as it takes tax dollars paid by one set of people and gives them to others through tax incentives that may or may not be producing an economic benefit to the state,” Thatcher said.

Steve Buckstein, a senior analyst at the Cascade Policy Institute, an Oregon-based public policy organization, says he doesn’t believe business subsidy programs do much good for the economy. He testified in support of the transparency bill.

“I don’t believe the state should be picking winners and losers through such programs in the first place,” he said. “Either way, I hope we can all agree that as long as such programs do exist, they should be transparent to constituents.”

Sreya Sarkar ([email protected]) writes from Chicago.