By Lydia White
Last week the Idaho Department of State Lands and the U.S. Forest Service signed ten agreements to allow logging and restoration on federal forest land, including land managed to benefit Idaho public schools by means of the Common School Fund.
Officials say allowing lumber companies to manage the land will create jobs while reducing the severity of wildfires raging in the western United States, costing over $2 billion this year alone. Jonathan Oppenheimer of the Idaho Conservation League says, “We’d like to see them recognize that you can still have a profitable timber sale while protecting some of those sensitive resources.”
Oregon faces similar wildfires, cost constraints, and environmental litigation, but hasn’t adopted Idaho’s successful approach, despite its Constitutional mandate to produce revenue for its own Common School Fund.
Earlier this year, the State Land Board halted the sale of the Elliott State Forest to a private company, an approach similar to Idaho’s, after backlash from environmental advocates. Instead, the Legislature passed a measure allowing Oregon to borrow $100 million in bonds to purchase the Elliott from a different state entity, all while costing Oregon’s Common School Fund billions in forgone returns.
Oregon, and other western states scourged by wildfires, should look to Idaho as it moves forward with its logging projects and adopt similar strategies proven to balance conservation and Constitutional requirements.
Cascade Policy Institute is set to publish a study of nine western states, including Idaho and Oregon, and their versions of the Common School Fund early next month.
Lydia White is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.
View the PDF version here: 10-4-17-Timber_Conservation_Oregon_Constitution_Not_at_Odds – PDF
By John A. Charles, Jr.
Some members of the Oregon Legislature think you don’t pay enough to travel. Therefore, they are considering a 298-page bill that would create multiple new transportation taxes.
The draft legislation, HB 2017, includes dramatic increases to vehicle registration fees, higher gas tax rates, a new sales tax on the purchase of motor vehicles and bicycles, and a statewide tax on all employees to subsidize transit.
In addition, a percentage of money currently paid by customers of investor-owned electric and gas utilities would be diverted to subsidize electric vehicle owners.
Billions of dollars would flow to various bureaucratic entities, with little accountability. Those of us paying the taxes would hardly know we’re paying them, and we would have no idea how the money was being spent.
The legislative strategy of simply “throwing money” at transportation is not going to work, because it’s already been tried. For example, TriMet riders only account for about 10% of all revenue in the FY 18 budget; the rest of TriMet’s income is derived from various backdoor taxes.
The agency’s most lucrative income source is the regional payroll tax, authorized by the legislature decades ago. TriMet has been raising its payroll tax rate almost every year since 2005 and will continue to do so through 2024. As a result, the agency now collects over $366 million annually from employers to subsidize transit operations. Yet, in the first decade after tax rates began rising, TriMet service actually declined.
Much of the new money went to pay for generous union contracts rather than the promised service improvements. The result: In 2016, employee benefits equaled 123% of wages. In other years the ratio has been as high as 149%. This is not a finance model that we should emulate.
The best way to improve any kind of service is to have a tight fit between what we pay as consumers and what we get in return. If we don’t know the real price, we can’t evaluate the purchase. And if taxpayers are being forced to subsidize unrelated services, there can be no fiscal discipline.
A better option would be to euthanize this 298-page monstrosity and work to implement highly-targeted user fees. The social costs of travel such as congestion, road wear, and noise pollution vary considerably by time of day, direction of travel, weight of the vehicle, and other factors. The user fees that we pay should account for these differences.
Gasoline taxes and vehicle registration fees are poor user fees because they are fixed, mostly invisible, and not time-sensitive. But new technologies now allow us to collect the full cost of each trip in real time by all modes of travel.
Some auto insurance companies already collect detailed driving data because they sell mileage-based policies. Millions of American drivers also own toll tags for use in modern tollways. And many transit operators use digital technology to collect variable fees based on distance traveled, type of service, and time of day.
User fees should be precisely calculated, and revenues should be dedicated to maintaining and improving the services paid for by consumers, with no cross-subsidization of other modes.
Transportation finance doesn’t have to be complicated. Legislators only make it that way when they don’t want you to know where the money is going.
John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.
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A report released Monday by Cascade Policy Institute recommends that cities and counties within TriMet’s service jurisdiction consider leaving the transit district.
The study shows that TriMet’s ongoing financial crisis is not just a temporary problem, but a permanent one caused by a failed business model. The agency has one of the most expensive union contracts in America, and the managerial obsession with rail transit is cannibalizing bus service. These problems go back decades, and it’s now too late to fix them.
Due to these factors, TriMet will face annual service reductions beginning fiscal year 2017. Those cuts will slowly destroy the agency. State law has long allowed jurisdictions to leave TriMet, and six communities already have: Molalla, Wilsonville, Sandy, Canby, Damascus, and Boring. Four of those cities created their own transit districts. Based on these experiences, the Cascade study recommends that more jurisdictions consider opting out and create their own transit districts.
Cascade Policy Institute’s report shows that the four cities operating their own public transit systems have lower labor costs, lower payroll tax rates, no long-term debt, virtually no unfunded liabilities for retirees, and better service than they previously had under TriMet.
Services under TriMet have continually declined since 2005, yet the TriMet payroll tax is at an all-time high of 0.72 percent.
“With major TriMet service cuts projected for FY 17 and every year thereafter, jurisdictions still paying the TriMet payroll tax should begin investigating options for leaving the district,” says the report.
According to Cascade President John A. Charles, Jr., “When TriMet was formed in 1969, the expectation among supporters was that creating a single public monopoly transit provider would create economies of scale. Unfortunately, what we really created were ‘diseconomies of scale.’ TriMet’s business model is now permanently dysfunctional, and the evidence from opt-out cities is that ‘smaller is better.’ Cities such as Sherwood, Tualatin, Lake Oswego, and West Linn should not wait for the inevitable collapse of TriMet; they should actively begin assessing the prospects for creating their own transit agencies, either as stand-alone districts or in partnership with nearby communities.”
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By Richard Vedder, Ph.D.
Click here to read the full report: