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The
public employee unions:
AFSCME--American
Federation of State, County & Municipal Employees
OPEU--Oregon
Public Employee Unions
OEA--Oregon
Education Association
OSEA--Oregon
School Employees Association
AFT--American
Federation of Teachers
.
Last
fall, the 18,000-member Oregon Public Employees Union approved
a $2.75-a-month dues increase to finance political activities.
A
letter from the Christian Coalition to members, supporting
both Lon Mabon and Bill Sizemore's measures, says the initiatives
will: "block the teaching of homosexuality in the classroom;
place a serious crimp in the pagan environmentalist movement;
and limit the financial resources that are propelling the
liberal agenda."
Loren
parks got his start in business making plethysmographs for
penises and other organs.
Political whiz bang Patricia McCaig (above) has spent two
months knocking on corporate doors looking for leaders who
can bring some fresh faces--and healthy bank accounts--to
the effort to dethrone the king of Oregon's initiative system.
Top
corporate donors against Measure 47:
Pacific
Power: $35,000
Portland
General Electric: $30,000
US Bancorp:
$30,000
Legacy
Health System: $25,000
First
Interstate Bank: $20,000
There
are about 23,000 AFSCME members statewide who pay $3.25
a month to finance political campaigns.
Oregon Intel chief Jim Johnson (above) answered, and he
hopes his
high-tech colleagues will follow.
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Sidebar: "Sizing
up the Measures."
SIdebar: "Follow the Money"
For the past six years, Oregon politics has been like an
extended-run movie that plays over and over again. Sometimes
we vote, sometimes we sneer, but we never change the reel.
It's the Bill Sizemore Horror Picture Show.
You know Sizemore. He's the recurring character who gave
us the 1996 Measure 47 property-tax limit and its spawn,
Measure 50, and in 1996 defeated a north-south light rail
measure.
Oregon politics has become all Sizemore, all the time.
Look at last month's primary. Thousands of volunteer hours
and more than $400,000 were spent in a frantic campaign
to supplement the Portland Public Schools' coffers after
a decade of property-tax limitations pushed in part by Sizemore.
The urgency of the campaign was heightened by a 50 percent
turnout requirement--another Sizemore legacy. Separately,
voters rejected Measure 79, a referral that would have increased
the number of signatures required to qualify constitutional
amendments. It was a desperate attempt by the state Legislature
to rein in Sizemore's fourth branch of government: the initiative
system.
It's about to get worse. This year, Sizemore says he plans
to run at least four ballot measures--one law shy of a full
house of anti-tax and anti-union initiatives ("Sizing up
the Measures," page 33). The most notorious is the federal
deductibility bill. If it passed, it would be the most serious
cut the state has ever faced.
It doesn't seem to matter much that Gov. John Kitzhaber
stomped him in last year's gubernatorial election; Sizemore's
playing governor anyway. He says he would consider pulling
the measure if the Legislature held a special session to
implement the same bill with a more gradual impact. Meanwhile,
the actual governor pulled his school-funding initiative
last April, because he was stymied in trying to come up
with enough money to fight Sizemore at the same time.
In the past, fighting Sizemore has been a lonely battle.
The political will and money have come almost exclusively
from public employee unions. In 1996, for example, the unions
put up 85 percent of the money to fight Measure 47.
This year will be different.
For the past two months, a handful of people gathered by
Kitzhaber have been scheming to kill a trio of anti-government
measures that will be almost surely be on the ballot this
November: Sizemore's federal-deductibility measure, another
Sizemore measure to curb taxes and fees, and a limit on
state spending proposed by Don McIntire.
The group, led by Bill Wyatt, Kitzhaber's chief of staff,
and Patricia McCaig, who was chief of staff for former Gov.
Barbara Roberts, was formed when the state's public employee
unions said that this time they couldn't fight Sizemore
by themselves. The group has settled on a plot in which
the state's business leaders, not labor groups, will be
the protagonists in this year's Sizemore drama. The unions
will still be there, but no longer alone. The goal is to
raise $2 million from the business community--if successful,
it would be the greatest single effort aimed at Oregon's
corporate leaders.
The change in tactic is partly out of necessity--the unions
will be busy fighting other Sizemore initiatives--but also
strategic. In addition to cash, the corporate leaders are
expected to bring a level of credibility that will allow
Sizemore's foes not just to push him back this November,
but to bury him, perhaps forever.
"This is the year that Sizemore is going down. I can feel
it," says Lisa Grove Donovan, a pollster for the public
employee unions.
The problem is, until now the people who could be the stars--including
Oregon's "new economy" elite--have been ignoring the show.
It isn't clear if they're willing to play that role.
Sizemore has never had a problem finding business support
for his measures. Though he paints himself as a grassroots
populist, his backbone support comes comes from conservative
millionaires like Loren Parks, Wes Lematta, and Robert Randall
("Follow the Money," page 42).
There is no countering cabal of progressives or even moderates
who are willing to match Sizemore dollar for dollar. There
is no leftie version of Mark Hemstreet who will write a
personal check for $100,000, no pro-public-education Loren
Parks with $200,000 in his pocket, no tree-loving Robert
Randall.
Just ask Ron Saxton. The chair of the Portland School Board
had hoped to get at least $100,000 from individual donors
for Portland's local-option campaign. The well-connected
Portland lawyer fell short by $70,000.
"We hoped it was self-evident that this was a good thing
to support, but it turned out that if we wanted to raise
money from an individual it was more about building a relationship."
That's where Patricia McCaig comes in.
In addition to working for former governor Roberts, McCaig
is a former Metro Councilor. She's married to former Tri-Met
general manager Tom Walsh and is now a paid political consultant.
In other words, she is as close to a member of the Democratic
party aristocracy as exists in the state of Oregon. When
it comes to fund-raising, that may be both her strength
and her weakness.
McCaig is at once charming and ruthless. She has run numerous
campaigns, including Metro's 1995 Greenspaces campaign.
Most recently, she led the successful 1998 Parks and Salmon
ballot measure, raising close to a million dollars, much
of which came from rich people and business leaders. But
it's one thing to get people to write a big check to preserve
state parks and our beloved salmon. It's another to get
them to finance a campaign against a measure that would
significantly lower their tax bills.
Sizemore wishes her luck. "Business has never stepped up
before," he says. "I never put measures on the ballot unless
they're popular. If people like a measure, it's a mistake
for business to fight it. They are very careful of making
enemies." Besides, he says, a company would betray the trust
of its investors and employees by fighting a measure that
contributes to its bottom line.
Convincing business leaders to vote against their pocketbook
isn't the only hurdle McCaig will have to clear.
First, she says, the pool of locally owned traditional
big businesses is shrinking. Corporate entities you could
depend on, like Pacific Power, First Interstate Bank and
U.S. Bancorp, have merged and remerged, and as they get
further away from Oregon, their donations become more elusive.
"It used to be, there were at least a handful of people
who could be counted on to give $100,000 or whatever, pick
your amount," McCaig says. "The world is different now.
They don't exist anymore."
She's also battling campaign fatigue, says Fred Miller.
Miller handles the political money for Portland General
Electric (now owned by Reno, Nev.-based Sierra Pacific).
PGE gave $30,000 to fight Measure 47 and is part of the
Portland Chamber of Commerce crowd, which has regularly
contributed to state politics. "Traditionally, timber was
there," he says. "Banks and utilities have always been there,
as has Fred Meyer. These are the ones you used to be able
to count on. But when you go to these people time and time
again, they start to think, Isn't there someone else who
can help?"
McCaig is banking on the answer being 'yes.' And it looks
like she's found her first hero.
There isn't a single company in Oregon that would benefit
more from Sizemore's federal deductibility measure than
Intel. The corporate behemoth, the state's largest private
employer, pays 15 percent of the state's corporate income
taxes. The measure would save it around $18 million in taxes,
based on what it paid last year.
Jim Johnson, vice president and head of Oregon operations
for Intel, doesn't care. In a time when high-tech companies
cannot find qualified engineers and other skilled workers,
Johnson says, the idea of gutting the state budget and hoping
everything will work out OK is unconscionable.
"What's different about this one is the magnitude of what
it's going to do to the state and the rapidness at which
it happens," he says. "It will be devastating. We'll live
through it, but it's not a good way to run a state. We have
to make a decision for investments in our future."
Intel has gone up against Sizemore before. In 1996, the
company gave $15,000 to the campaign against Measure 47.
But this year, Johnson says, Intel has to fight much more
aggressively.
Johnson won't say how much money Intel will give to the
campaign, but he's prepared to be an early and large contributor.
He's already begun slipping rallying cries into his speeches
around the state and has been e-mailing other members of
the corporate--especially high-tech--world.
Johnson's willingness to jump on the anti-Sizemore bandwagon
is critical for McCaig. She has a roster of targeted big
donors, but declined to divulge their names. She has acknowledged,
though, that the search for new money will inevitably lead
from the well-worn political paths of downtown Portland
into the uncharted territory of Silicon Forest.
Johnson can help her tap into money and business cultures
that are unfamiliar to her. Phil Knight, she knows. Bob
Pamplin, she can call. The health-care and timber industries
and other traditional companies still do politics, for the
most part, the old way. But there is an entire world, she
says, that she has no connection to. She illustrates her
point by telling a story about going into ¡Oba!, near
her office in the Pearl District, a few months ago on First
Thursday. "The restaurant was packed," she says, "I mean
packed. These were the workers from Intel or wherever
who had come into the city to have a good time. And I didn't
know any of those people."
It isn't going to be easy to tap into high-tech money.
Techies are notoriously apathetic about getting involved
in politics.
"They aren't known for large-scale political contributions.
It's hard to get them to contribute to political issues
and write checks," says Jim Craven, lobbyist for the American
Electronics Association, which includes the biggest high-tech
names in Oregon.
Most of Craven's clients are sporadic and, compared with
guys like Parks and Hemstreet, miserly when it comes to
state politics. Tektronix, Oregon's grandfather of homegrown
high-tech, ponied up $10,000 against mandated insurance
coverage of alternative medicine in 1996. So did Hewlett-Packard.
H-P also gave $15,000 against Measure 47. But to raise the
kind of cash McCaig is seeking, those folks will need to
add an extra zero onto their numbers.
It won't be easy.
Mentor Graphics spokeswoman Patty Arlett says she doubts
that her company, which employs 2,600 people in Oregon,
will join Intel in taking on Sizemore's tax measures this
November. "We don't even have a lobbyist," she says. Besides,
she adds, the Wilsonville company, which makes engineering
software used to design electronics, gives 1 percent of
its profits to a charitable foundation, which donates to
arts, human services and educational groups.
This is the kind of thinking that drives Ken Lewis crazy.
The retired president of both Lasco Shipping and the Port
of Portland commission, Lewis has taken on the Sizemore
campaign as a personal passion. "Where are these companies?,"
he asks. "There's so much apathy...[There's] this philosophy
that we just want to spend our time making money and let
decisions affecting our state be made by other people."
Craven bristles at the notion that his high-tech clients
have an inherent responsibility to play at politics. "I
think this line is getting old, the assessment that the
worth and value of a company is how much money they put
into politics," he says. "Where would this state be without
the money these corporations are already putting into the
general fund?"
Nevertheless, next week, American Electronics Association,
a high-tech trade group, will vote on whether to join the
anti-Sizemore fight. Craven thinks the group will lend its
support. The question then will be how widely the members
will open their wallets to fight a measure that would save
them money on their corporate and personal tax returns.
Duane Schultz is one high-tech entrepreneur who has gotten
involved in the public realm. A former executive at Apple,
Hewlett-Packard and Now Software, Schultz co-chaired a task
force that reported to Kitzhaber on the needs of graduate
education in the state; he has also volunteered with the
Portland Public Schools and managed the school's facilities
task force. "In that involvement," he says, "I found I was
always going to meetings where I was the only high-tech
person there."
Given his involvement with public education, Schultz doesn't
have to be convinced that this year's crop of Sizemore ballot
measures is dangerous. But he's still not planning on joining
the effort to dethrone Oregon's ballot-measure emperor.
"I don't believe I could get enough critical mass of technology
leaders to stop him," Schultz says. "They're very focused
on their businesses and their investments."
Gerry Langeler, one of the co-founders of Mentor Graphics
and now a partner in Olympic Venture Partners, says he'll
give money if he's asked, but he won't be standing next
to Jim Johnson on the front lines. He agrees with Schultz
that the high-tech world is so intense it leaves little
room for politicking.
"One of the startups we recently funded, the first thing
they bought was a condo near the office where they put 20
cots so the people could sleep without going home," he says.
Tom Bruggere is another high-techer who could lead a fight
against Sizemore, but he says he's waiting until things
get more organized. The former head of Mentor Graphics spent
$1.5 million of his own money in a failed bid for Senate
against Gordon Smith in 1996. When pressed, he admits he
could write a huge check to the effort--$200,000? $500,000?--if
he believed McCaig and gang could pull together a cohesive
campaign.
"I think it would take a helluva lot more leadership than
exists today in this state in fighting these kinds of alternative
government initiatives," he says.
It's early in the campaign. Until last week, McCaig didn't
even have a bank account for the political action committee,
which goes by the tongue-twisting name of Our Oregon. McCaig
officially stepped down from the campaign June 1, though
she says she'll continue to volunteer. Two local political
strategists, Mark Weiner and Paul Phillips, are vying to
replace her.
Thanks to Johnson, whoever gets the job will have a head
start. The benefit of getting the Intel executive to sign
up so quickly is twofold. First, money follows money: Whatever
amount he kicks in will serve as a signal to others that
this is not a lost cause. But even more important is the
credibility that his support brings.
The Sizemore electorate has traditionally been one of thirds:
One-third of the voters always vote with him, no matter
what he throws on the ballot, and one-third against him
just as indiscriminately. In the battle for the remaining
third, Sizemore has been masterful at using his opponents'
funding sources against them.
The opponents of Measures 47 and 59 weren't just bankrolled
by unions, after all--they were bankrolled by public employee
unions. Clearly, goes the Sizemore rap, they are motivated
by self-interest.
So, what can he say about an Intel executive? This is not
a lazy union goon getting fat on your property-tax dollars.
This isn't an overpaid teacher whose union dues go to save
her cushy job. This isn't some small-minded state bureaucrat
who loves red tape.
Rather, this is a man who got rich in an industry historically
hostile to organized labor. A man who stands to gain big--on
a personal and corporate level--if Sizemore prevails.
"I am one of the two percent that will get 40 percent of
the benefit," Johnson says. "Long-term, I would benefit
personally financially. But people have to ask themselves,
what's the right thing for the state, not the right thing
for me."
SIZING
UP THE MEASURES
Here is a list
of the initiatives that Bill Sizemore's Oregon Taxpayers United
is most likely to put on the ballot this November:
SIZEMORE* Full deductibility: This is the
measure that has the governor's office in a lather. Currently,
in Oregon, if you pay $3,000 in federal income taxes, you
can deduct that $3,000 from your state income tax bill.
That's the limit. If, for example, you pay $5,000 in federal
income taxes, you can still deduct only $3,000 from your
state income-tax bill. Sizemore calls it double taxation,
and his measure removes the $3,000 cap. Problem is, it's
a $1 billion income-tax cut for those who need it least.
More than two-thirds of the savings would go to people who
make $100,000 or more, according to the Legislative Revenue
Office. If passed, the measure would reach into the budget
passed last year in Salem and take $300 million from state
schools alone. The bill has been widely criticized even
by stalwart Sizemore supporters such as Oregonian
columnist David Reinhard because of its retroactivity.
* Vote on all taxes: This would require voter approval
of all statewide taxes and fees. It also is retroactive,
affecting fee and tax hikes from the past two years.
* Son of 59: This would prohibit using public funds
for political means. It's aimed at eliminating payroll deduction
of public employee union dues. It also preempts a push to
implement public financing of campaigns. This is a narrower
version of Measure 59, a failed 1998 initiative that was
so broad it would have prohibited state money being spent
on the Voters' Pamphlet.
* Union dues: This measure would require written
permission from union members--both public and private--for
payroll dues deduction used for political purposes.
* Teacher merit pay: This would peg teacher pay
to performance measures. If OTU decides to wage a serious
campaign in support of this measure, the Oregon Education
Association will stay away from the other campaigns.
* Takings: This would require compensation for any
rule changes that lower value of property. Sizemore won't
say for certain whether OTU will put this one on the ballot
in November.
--PW
FOLLOW
THE MONEY
Bill Sizemore doesn't like the notion that he's the waterboy
for a cadre of conservative millionaires who are buying
their way into the hearts of voters. He points out that
there are thousands of donors to Oregon Taxpayers United.
In that respect, he's right. In 1998, OTU reported more
than $200,000 in contributions of less than $50. But Sizemore
wouldn't have been able to run his campaign for Measure
59 without the $180,000, contributed both independently
and through OTU, by real estate developer Robert Randall.
In fact, it isn't likely Sizemore would have the impact
he does on the state without the few well-placed monied
men who have been supporting his measures for the past six
years years.
At one time, they were known by the romantic name the Round
Table. Assembled by Shilo Inn owner Mark Hemstreet in 1994,
they agreed at the time to pony up $100,000 each to go toward
conservative causes ("The Millionaire Men's Club," WW,
Nov. 16, 1994).
On the list was Wes Lematta, owner of Columbia Helicopter;
Loren Parks, the eccentric but generous medical-equipment
magnate; Harry Merlo, then-boss of Louisiana-Pacific; Aaron
Jones, owner of Seneca Sawmill; and Randall and Hemstreet.
Since then, they have taken on an almost mythological stature,
in part because the men involved are so elusive (they don't
talk to the press). They have had an enormous impact on
Oregon politics without ever having been elected to office,
and their reputation as right-wing bogeymen is even greater.
But not all the legends of the Round Table are true.
Sizemore, for example, doesn't do Hemstreet's bidding.
In fact, Hemstreet hasn't contributed to Oregon Taxpayers
United since 1996, when he gave $500 for the Measure 47
campaign. In 1998, he didn't give a dime to Sizemore, instead
running a separate set of ads in favor of Measure 59. Sizemore
didn't like it.
"It was an absolutely worthless campaign with ads as bad
as I've ever seen," says Sizemore. "I had nothing to do
with it. I did not encourage it, in fact I discouraged it.
But I did not talk to Hemstreet about it and did not coordinate
with him or anything."
This year, rather than backing OTU's measures, Hemstreet
will be supporting a spending limit proposed by Don McIntire.
But Sizemore will do fine without him. Sizemore says Loren
Parks has already contributed to Oregon Taxpayers United
enough to pay for signature gathering for the measures (which
could cost upward of $400,000) and will probably give more
as November gets closer. Sizemore also believes Lematta
and Randall will give again.
Sizemore has also has an out-of-state source of cash. In
1996, he received more than $300,000 from Americans for
Tax Reform, Grover Norquist's taxpayer group in Washington,
D.C. Sizemore will not say how much he expects to get from
ATR this year. --PW
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Willamette Week | originally
published May 10,
2000
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