IMAGE: Jonathan Hill

Two key Democratic interest groups are locked in a behind-the-scenes battle that threatens to blast apart the coalition they have used to gain large legislative majorities in the Legislature.

On June 27, enviros and labor met with lawmakers for a third time in hopes of resolving their dispute.

The question? Whether environmentalists should proceed to the November ballot with a measure that would lock into the Oregon Constitution their right to 15 percent of Oregon Lottery proceeds for parks and habitat. (That current 15 percent set-aside expires in 2014.)

Kevin Looper, the director of union-funded Our Oregon, says any permanent set-aside of those lottery millions for parks and habitat needs a cap because the current state budget can’t pay for basic services.

“Without addressing those issues,” Looper says, “proponents run the risk of looking like they are grabbing for the cookie jar at a time when many folks around the table are going to be going without dinner.”

Time is running out for a resolution. Supporters of the measure must submit their final batch of signatures by Friday, July 2. The campaign—called Oregonians for Water, Parks and Wildlife—has already spent more than $1 million gathering the needed 110,358 valid signatures.

Beyond the money fight, there’s a second issue splitting labor and enviros over the lottery initiative. Enviros wrote the lottery measure before voters approved Measure 68 in May. Now, lawmakers and the Oregon Education Associaiton say the lottery measure would effectively amend Measure 68, which extends state bonding authority to local districts, out of existence. The OEA supported Measure 68 because it makes it easier for cash-strapped districts to build and maintain facilities.

The current battle over lottery money requires enviros to decide whether they want to fight the OEA—the state’s biggest public employee union—and the legislative leadership that supports its position in this high-stakes battle.

Together, labor and enviros worked earlier this year to pass tax-increasing Measures 66 and 67 and in years past to fight Bill Sizemore’s measures targeting public employee unions. They’ve also worked to get a 36-24 Democratic majority in the state House and 18-12 for Democrats in the Senate. To have that coalition fraying before legislative and governor’s races this November is extraordinary.

“Progressives have been very successful in passing and defeating ballot measures in recent years because we have refused to be divided by our opponents,” says Looper, who has often coordinated ballot measure coalitions.

Given that the May revenue forecast revealed a $577 million hole in an already pared-down state budget, it’s no surprise the disagreement focuses on money—lots of it.

In 1998, environmentalists scored an epic victory when they convinced voters to set aside 15 percent of lottery proceeds for parks and habitat restoration. How epic? In the 1989-1991 budget, spending on such programs totaled $12 million; today, thanks to the explosive growth in lottery revenues, spending has grown to $175 million.

But the 1998 measure creating that bonanza ended the set-aside in 2014 and provided a referral to voters for renewal. Proponents decided to put the question of enshrining the funding in the constitution to voters this year, however, because the referral is not guaranteed.

Legislative leaders—particularly House Speaker Dave Hunt (D-Gladstone)—and the 48,000-member OEA grew uneasy about losing permanent control over a portion of one of the state’s most reliable sources of revenue. And they fear restrictions in the measure place additional demands on the general fund.

Those concerns set in motion an increasingly tense series of meetings. Last week, Nature Conservancy lobbyist Nan Evans sent an email recapping what she termed “a truly fascinating and frustrating 24 hours.” Evans described a June 23 meeting that brought together key lawmakers, union reps and enviros.

“Basic themes of the discussion included the current state budget crisis; the probability of winning/losing at the ballot; the risks of splitting overlapping constituencies; the prospect of a fight over the measure if OEA opposes…impact of the budget deficit on teachers’ jobs,” Evans wrote.

She also described alternatives Hunt proposed if ballot measure proponents agreed to abandon their effort. Among them is a cap that would “index the growth in the Parks and Natural Resources Fund to the rate of growth of the GF [General Fund] and LF [Lottery Fund] combined.”

In her email, Evans told supporters that the meeting’s “bottom line was—‘is there a path forward without a fight?’”

Most of the same dozen or so parties convened again on a June 27 conference call, during which Hunt again urged proponents to back off. The hammer in his tool kit is the possibility that OEA could spend money on a campaign against the measure, which would provoke the kind of Democrat-on-Democrat violence party leaders fear.

OEA lobbyist BethAnne Darby says her organization will not decide what path to take until August, but says opposition is certainly a possibility.

“At a time when education is poised to lose the equivalent of $265 million in funding and we cannot see an end to the current crisis, it seems premature to lock in funding in the constitution for a particular program that is not subject to limitation,” Darby says.

So will proponents turn in signatures on Friday? “Yes, absolutely,” says campaign spokeswoman Jessica Moskovitz. “We’re very proud that we have more than enough to qualify.”