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Dear Friends and Neighbors,
Saturday was a good day.
Often as a legislator, I craft budgets and write laws, only to see them dissipate into our coastal communities like an evening fog. Seldom do I see the results of my work in a way that is tangible, touchable, and real.
Saturday, I was invited to the ribbon cutting at the new Depoe Bay Docks. The old wooden docks were constructed 75 years ago and were dangerously falling apart. Four years ago, the city reached out, and we were eventually able to secure nearly $5 million for new harbor infrastructure.
Our new docks will support the recreational fishing and whale watching fleet, private boats, and, importantly, our Coast Guard. They will make the world's smallest harbor safer. And they will help the unique marine economy that thrives there.
I told the crowd that we had accomplished all of this by working together. And I laughingly added that the new docks would not look this good again in our lifetime. In gratitude for the effort, Depoe Bay gave me a very heavy piece of the old dock.
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Good days as a legislator sometimes mean big things and sometimes mean having a big impact on a small family. Saturday, we also learned that my staff had succeeded in reversing a garnishment for a constituent who had been fined for not paying a bill that had been sent by the State to the wrong address. A $128 expense had ballooned to $2,539 in penalties over a five-year period. Fixing that helped make Saturday a doubly good day.
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Oregon is required to maintain a balanced budget. We can’t spend more than we bring in from income taxes, corporate taxes, alcohol and cannabis taxes, the lottery, and federal grants.
To better understand the status of our economy and the resources we have for state spending, the legislature receives quarterly reports from the state economist. I often share those reports in my newsletters because they are important. But I also describe the economist's job as one of the most difficult in state government – trying to estimate wages, exports, new business, and population changes in the face of pandemics, wildfires, and Washington, DC.
In a report issued this week, chief economist Carl Riccadonna and senior economist Michael Kennedy told Oregon lawmakers to expect to have about $350 million more than they thought they would have at the last forecast in November. Oregon’s economy is strong, with wages up and businesses growing.
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The economy is strong but also fragile. Everything is changing as we speak. Federal announcements about taxes, tariffs, mass firings, and spending cuts haven’t yet affected Oregon’s economic forecast, the state’s chief economist reported. Riccadonna said tariffs could have a particularly acute effect on Oregon. The state’s economy relies more on manufacturing and trade than most states, and it’s especially sensitive to trade with Asia.
The positive adjustment is largely attributed to robust wage growth, leading to higher-than-expected personal income tax revenues. However, the forecast also highlights potential challenges. Oregon is falling behind the rest of the country in job growth, population gain, and GDP. Key industries that provide good-paying, long-term jobs—like construction and manufacturing—are struggling. The concern of persistent inflation and uncertainties surrounding federal policies are also concerning.
The forecast, despite the revenue boost, is among the least dramatic lawmakers have seen in recent years. The state has grown accustomed to forecasts with revenues in numbers that have shocked state economists. Those unexpected surges have led to a series of ever-higher “kicker” payments — the refunds returned to personal income tax payers when revenues come in 2% or more above expectations.
You can read the entire March Economic & Revenue Forecast Presentation here.
Read more in the Capital Chronicle here.
Read more in OPB here.
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I will say again that our economy is strong but fragile, with increasing uncertainty resulting from Washington, DC. That uncertainty is landing hard in rural Oregon.
More so than in Portland, Eugene, and other urban centers, rural Oregon depends on Medicaid and food assistance, money to prevent and battle wildfires, programs to boost farmers, and grants to upgrade infrastructure like high-speed internet coverage across vast expanses.
The end result has left many rural Oregonians unsettled over the turmoil that’s unfolding in their communities. Read more here.
Officials have said as many as 10% of the state’s nearly 30,000 federal employees already have received termination notices. That includes Forest Service workers, Veterans Affairs staffers, Bureau of Land Management managers, scientists across multiple agencies, and Bonneville Power Administration employees, who ensure that the region’s power grid doesn’t fail.
And those cullings could have greater consequences on rural Oregon, where good-paying jobs are tough to come by. An Oregon Employment Department report released Wednesday shows federal employment pays significantly more than the average salary in almost every rural county in the state.
| Support and maintenance workers for the NOAA Marine Operations Center Pacific ships in Newport have been terminated. | |
Here in our part of rural Oregon, news is landing hard. Yachats News had an excellent overview this week of local effects.
- The staff at the U.S. Fish & Wildlife office has been cut from nine positions to 4.5.
- Three positions at the U.S. Department of Agriculture’s agriculture experiment station and the lead oyster researcher on the Oregon coast were fired last week, and USDA funding for an OSU student/researcher was cut. The oyster researcher’s dismissal was rescinded this week.
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There are four branch offices of the National Oceanic and Atmospheric Administration at the center, including three research ships. Termination notices to 880 of 12,000 NOAA employees across the country went out Thursday – sure to impact the nearly 100 working in Newport.
- Four employees at the U.S. Environmental Protection Agency research facility in Newport, representing 40 percent of its research staff, were terminated on Feb. 14.
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Half of the rangers at Yaquina Head Outstanding Natural Area were terminated on February 18, and a seasonal ranger who was supposed to return to work this week had his position rescinded.
- The Cape Perpetua Visitor Center will no longer have any temporary or permanent seasonal staffing for interpretation.
| The federally-run Yaquina Head Outstanding Natural Area north of Newport lost four of its employees through dismissals or rescinded job offerings this month and has cut back operating hours and programs. | |
I told OPB last week, “When we start losing people here, and we are losing people, that puts at risk the work we’re doing to understand ocean warming and hypoxia and acidification and rising water levels. It also puts the fishing people going into those waters at risk if they don’t have a clear prediction of what the conditions are going to be out there.”
Robert Cowen, the director of the Hatfield Marine Science Center, added that the work the scientists do has a huge economic impact on the state of Oregon. “We have some of the best managed fisheries in the world. When you have sustainable fisheries, it’s well recognized and easier to sell the fish at a premium.”
These changes have broad consequences in our communities that rely on NOAA to tell us if an ice storm is coming or on Hatfield researchers to prevent disease from devastating the oyster industry. But there is also a human side of these dramatic shifts.
I’m hearing from long-time federal workers who received emails terminating their work with one hour to clean up and leave. I’m hearing from people with positive performance reviews that are now fired “for cause”. And I’m hearing from people who were on “probation” now suddenly dismissed. Those probationary workers are either newly hired or have worked in the federal government for decades and started a new role that subjects them to a probationary status of one to two years. When you are fired for cause or during probation, this raises questions as to whether you qualify for unemployment compensation. So these families are suddenly wondering how to buy groceries next month.
We have concerns about what may be next.
Federal funds represent nearly 11 percent of the Lincoln County School District’s $107 million operating budget. The money is used for programs such as special education, food services, college and career readiness, and professional development for staff, the district said.
Lincoln County Health and Human Services director Jayne Romero said her department receives $18 million in federal funds that come either directly from the federal government, are passed to the county from the state, or are earned by providing health care to individuals under the Oregon Health Plan, Medicaid, and Medicare.
There are major worries that the nearly-complete $80 million PacWave wave-energy testing project taking place north of Waldport will be shuttered if the U.S. Department of Energy, which has funded much of the project, turns its focus to oil and natural gas production — as President Trump has asked.
The Port of Newport is seeking about $28 million in federal grants from both the U.S. Department of Transportation and the Maritime Administration’s port infrastructure development plan to replace its Port Dock 7.
Angell Job Corps has 143 students, about 51 staff members, many of which are not Forest Service employees, and an annual budget between $4.5 million and $6 million. Angell, like other Job Corps, is operated by the US Forest Service in partnership with the US Department of Labor.
Oregon’s Democratic U.S. House members warned this week that firing firefighters and employees at agencies that manage federal land could have drastic consequences for the upcoming fire season. The federal government owns just over 50% of Oregon’s land, and it’s mainly managed by the U.S. Forest Service and the Bureau of Land Management.
Let me be clear. I support identifying and eliminating waste in government. Right now, I’m engaged in reviewing state budgets and applying 10% reductions to each of our agencies in the event that revenue does not meet expectations. You need to do that carefully. But what I’m seeing from Washington, DC, is not careful.
Rural Oregon is hurting and very angry. And our federal government is about to make them hurt more and probably make them angrier.
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Medicaid is a federal and state health insurance program that provides essential medical and health-related services for many Americans, including those from low-income families. In Oregon, the Medicaid program is known as the Oregon Health Plan (OHP). Currently, 1.4 million Oregonians are enrolled in OHP, representing 34% of the state’s population. 57% of kids (0-17 years old) are enrolled in the program, highlighting its critical role in supporting Oregon’s youngest residents.
Oregon is fully “leveraged” in Medicaid. We offer wide access, and we’ve expanded what services are covered. These are all considered good “bangs for the state fund buck” because of the federal contribution. Medicaid is jointly financed by the federal government and states. The federal government contributes approximately 2/3rds of Oregon’s funding, while the State covers the rest. Recent news out of DC has raised profound concerns about Medicaid’s future.
| Here is a dashboard that shows up-to-date Medicaid enrollment by county. | |
The US Congress is poised to reduce federal Medicaid funding drastically. These proposed cuts would reduce Medicaid spending by one-fifth—approximately $1.9 trillion over the next decade—and could result in the loss of coverage for up to 20 million people nationwide. If federal support diminishes, Oregon would try to fill some or all the resulting funding gaps, potentially taking money from other key services such as K-12 education, public safety, and childcare subsidies.
Remember, no Medicaid cuts have happened yet. U.S. Rep. Cliff Bentz, R-Ore., said Wednesday that the nation’s spending on Medicaid programs is unsustainable, and he urged patience as Republicans in Congress formulate their plan to dramatically reduce spending on the health care program. You can listen to his interview on OPB here.
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Hearings of interest this week:
Few bills this session will be more heavily fraught than House Bill 3140, which would allow all recreational businesses to require customers to “release the operator from any claim for ordinary negligence.” In other words, to sign a liability waiver.
| Slippery slope: Trial lawyers push back against the recreation industry. | |
Representatives from the recreation industry—which state figures show generated more than $16 billion in spending in 2022—say huge jury verdicts have caused insurance costs to soar, threatening the survival of the mostly small businesses that connect Oregonians to the pastimes they love. But trial lawyers argue that forcing consumers to waive their rights to sue for ordinary negligence is fundamentally unfair. Their argument asserts that passage of HB 3140 would strip protections from consumers.
The measure is sponsored by a bi-partisan group of legislators – most of whom represent recreational districts. Read more, or you can watch the hearing here.
Another provocative hearing was on HB 3179.
Since 2021, Oregon’s largest utilities have increased billing rates by nearly 50%. As of October 2024, over 150,000 Oregonians had their power disconnected due to unpaid bills– almost the population of Salem. This measure directs the Public Utility Commission to consider the cumulative economic impact of a proposed rate increase before approving it. You can watch this hearing here.
I have co-sponsored both of these bills.
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OK – how about some good news?
With rents rising at mobile home parks nationwide, advocates tout the cooperative model as a way to preserve one of the last affordable housing options for people with low or fixed-incomes and to give them a greater voice in managing their parks
Back in 2014, I supported an Oregon law that said if a company plans to sell the land of a mobile home park, residents have the first opportunity to join together and form a co-operative, get funding, and make a bid to buy the property.
The latest success story is Surfside Village in Newport. Susan and I joined the residents last week to celebrate.
Surfside Village was first put up for sale in 2015. However, the owners and the committee of residents were unable to come to an agreeable purchase price. They were advised to wait and see if they could purchase again in the future. When the property was put up for sale again in 2024, they worked with Casa of Oregon for over ten months to put a deal together.
There are currently 28 Resident Owned Communities (ROC) in Oregon. Unlike traditional manufactured home communities, ROCs are not subject to market-based rent increases, and there is no profit margin in monthly site fees. This cooperative ownership gives homeowners the ability to control costs, improve facilities, and make their own rules while providing the peace of mind of land ownership.
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Senator Anderson and I held our first joint Town Hall for the session on Friday morning. Since the Ways and Means Committee was not meeting this week, we were both able to be there in person. | |
Monthly gatherings like this are planned, but as our Friday committee gets more business, we will likely be attending remotely.
Thank you to Dave Price and Oregon Coast Community College for organizing these important opportunities for us to listen, answer questions, and update all of you. There were 30 people in the room and another 70 online.
If you missed the Hall, you can watch the recording here. If a passcode is required, use &KjMBX03
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Representative David Gomberg
House District 10
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