At issue is SB 426, a good idea that sailed through the House and Senate and that Gov. Ted Kulongoski is expected to sign. The concept is simple: Many of Oregon's 198 school districts now buy health insurance for employees individually, rather than as a group. SB 426 would instead pool most of those employees into one unit for insurance purposes. Citing actuarial studies done in Oregon and other states that show pooling would lower costs here, proponents argue that consolidation spreads risks and yields greater bargaining power.
The biggest opponent of pooling in Oregon has been the Oregon School Boards Association, which might be expected to support saving districts some money, if it didn't have a giant conflict of interest. According to its most recent annual report, OSBA got 59 percent of its $4.3 million in revenue in 2005 from fees for managing school districts' insurance needs. Pooling would take away most of those revenues, a big problem for the organization's 34 employees.
On March 13, when the House was due to vote on the bill already approved by the Senate, Scott papered members with a flier titled "The House that OEA built," refering to the Oregon Education Association, the teachers' union. The flier named the 40 representatives—including nine Republicans—to whom OEA gave money in 2006.
Scott's flier claimed the OEA-supported bill "will cost school districts millions in additional expenses. Scott's spokesman didn't return WW's calls.
The heavy-handed flyer was unusual enough on the House floor that Speaker Jeff Merkley (D-Portland) invoked a House rule that prohibits "impugning the motives" of members. Rep. Scott Bruun (R-West Linn), one of the Republicans whom Scott impugned, noted that he backed pooling long before OSBA backed him.
"I have never once seen an occasion when economies of scale didn't reduce costs," says Bruun, CFO of a construction company and one of the R's to vote yes for pooling.