The Oregon Legislature on Wednesday passed a far-reaching package of bills that included a public employee retirement system cost-of-living reduction and an increase in some corporate taxes.
The Legislature also passed a bill that would pre-empt local governments from banning biotech crops. The House passed that bill 32-22, and the Senate followed, passing it 17-12.
Proponents of the pre-emption bill said it will prevent an onerous county-by-county patchwork of biotech rules.
The bills were part of the legislative package known as the “grand bargain,” which the Legislature approved during the special session Gov. John Kitzhaber called.
Kitzhaber had vowed to veto the entire package unless all the bills were passed by legislators.
The tax bill was the biggest initial hurdle because it had to pass with a three-fifths majority in each chamber. It would increase the corporate tax rate from 6.6 percent to 7.6 percent on income between $1 million and $10 million.
Rates for some S corporations — in which taxes are passed through to shareholders rather than applying to the business — would be reduced under the bill, depending on income level.
The net effect is an additional $189 million in revenue for the state over the next two years.
Some Democrats opposed the tax rate reduction provisions, while some Republicans objected to the corporate tax hike.
The most controversial portion of the Public Employee Retirement System reform provisions would reduce the rate of cost-of-living adjustments that increase retirement payments each year.
The Senate passed the reduction in the cost-of-living adjustment, 22-7, and the House passed it, 31-24, on Wednesday.