Major re-investment in Oregon schools finally crashes through
Monday, May 20, 2019
The Senate Republicans returned last week, allowing a foundation-shifting vote on the Student Success Act.
It happened suddenly. It was not clear early Monday, May 13, if the terms of a deal between Senate Democrats and Republicans would hold, but by the close of the floor session, House Bill 3427 had passed on a party-line vote.
On Thursday, May 16, Gov. Kate Brown signed the bill, dedicating $1 billion a year to helping Oregon's children and improving education. The Student Success Act is law, and although it is possible that it will be referred to the ballot, business leaders have supported the bill. The state’s leading business association, Oregon Business & Industry, said it would not oppose the bill.
To persuade the Republicans to return to the floor and procedurally permit a vote, Democrats agreed to give up a gun-regulation bill, Senate Bill 978, and a bill removing nonmedical exemptions for getting vaccinated, House Bill 3063. Those highly contentious bills had support and opposition from both parties.
Brown worked with the Senate and House leadership to negotiate a deal. Senate Republicans agreed that schools needed and deserved better funding, but they opposed the business tax mechanism.
The Student Success Act makes tremendous new investments in public education. When fully phased in during the 2021-23 biennium, the tax proposal is expected to net more than $1 billion in new revenue per year.
The Student Investment Account will receive roughly $1 billion a biennium, to be allocated directly to school districts for student social-emotional health and safety, well-rounded educational opportunities, smaller class sizes, and more learning time.
The remaining funds will pay for early learning investments, school meals, full funding for Measure 98, more resources for the High Cost Disability Fund, program administration, and full funding for Early Intervention/Early Childhood Special Education.
The legislation pays for these investments with a new commercial activity tax on business. The legislation lowers most personal income taxes to compensate for any bumps in consumer prices.
Legislative staff projections indicate the tax will raise $1.6 billion in the upcoming biennium. Factoring in allocations to the State School Fund to cover the income tax cut and other bill costs, staff expect $905 million to go to early learning and K-12 education: $475 million for the Student Investment Account, $170 million for early learning, and $260 million for statewide initiatives.
These investments will grow as the tax is fully implemented, providing stable funding for schools.
The Legislature is now turning to changes to the Public Employees Retirement System to rein in costs. The Joint Ways and Means Capital Construction Subcommittee, which includes the most powerful legislators in Salem, held a hearing on PERS proposals last week and has another one scheduled Tuesday.
Senate Bill 1049 is the likely vehicle for any changes. Current bill drafts would lower employer costs and decrease employee benefits and has drawn widespread attention. Any changes will be a tough fight.
For now, however, education advocates should take a moment to celebrate the Student Success Act, the first concrete step toward major re-investment in our schools in almost 30 years.
Sen. Rob Wagner, a Lake Oswego School Board member, praised the Student Success Act, saying it is an effort to build a better Oregon.
“This is a once-in-a-generation vote,” Wagner said.