While economists and pundits describe the period from 2008 to 2013 as “the Great Recession,” for the commercial construction industry it has been the Second Great Depression. Our industry has experienced over 40 percent unemployment for over five years. Thanks to projects like Intel’s D1X expansion, the Kaiser hospital in Hillsboro, and a number of data centers in the Columbia River Gorge and central Oregon, we’ve begun to see the faint glimmer of light at the end of the proverbial tunnel, but we’re not by any means out of that tunnel yet.
For three legislative sessions, we have joined our colleagues in the business community to work with policymakers at all levels to rebuild Oregon’s economy. Many have asked why Associated General Contractors Oregon-Columbia Chapter has moved outside its usual role of industry watchdog and stepped into such statewide issues as taxation, education and regulation of business. The reason is simple: Until the economy recovers, the construction industry can’t recover. And until that recovery happens, tens of thousands of skilled men and women will continue to look for lower-paying work and hope that they can hang on just a little longer.
With a steely focus on sustainable economic growth, AGC consistently pushes for good policy and good legislation, like investing in workforce development and preserving public infrastructure. But just as important, when we have to, we oppose flawed and harmful legislation. One such flawed proposal we oppose is Senate Bill 488, a bill that would remove the existing sunset on an experimental program called the low carbon fuel standard, or LCFS.
While the Oregon Legislature never approved the creation of an LCFS, in 2009 it directed the Oregon Department of Environmental Quality to study whether an LCFS could work in Oregon. During that process, the Legislature established a sunset for the study — an expiration date — of 2015, which meant that DEQ had six years to develop a program.
Four years later, DEQ has produced more questions than answers and more delays than results. Industry experts and economists forecast severe spikes in the cost of fuel production, which will likely hit consumers in their wallets. And companies testing the fuel mixes proposed under the standards are finding a growing trail of failing equipment and machinery that is very costly to repair, if it can be repaired at all.
Oregon should continue to explore and develop programs to reduce emissions. We are, after all, some of the world’s best conservationists. Protecting the environment is in our genes. In supporting programs that truly lead to cleaner air, for example, AGC has advocated for an incentive-based approach for emission reduction equipment. But an LCFS is the wrong approach. Only one other state in the country — California — has even attempted to develop an LCFS. That program is tied up in state and federal courts.
Organizations like ours who oppose SB488, including groups such as the Oregon Farm Bureau and the Oregon Refuse and Recycling Association, point out that Oregon’s nation-leading biofuel usage and renewable fuel standards are already doing what an LCFS would attempt to duplicate — encourage investments in alternative fuels and reduce emissions.
Simply put, it appears that the LCFS is an attempt by the state government to dictate what the market is already doing, and doing well. Oregon’s ethanol and biofuel companies already attract tens of millions of dollars in investments every year. Oregon’s renewable fuel standard already drives exciting new technologies to the marketplace. And the dizzying number of existing state and federal emissions and technology rules already contribute to real reductions in greenhouse gas emissions.
It is our strong hope that the coming years will be remembered as years of renewed economic prosperity. To accomplish that, we cannot fall prey to trying to make reality fit into theory.
For generations, Oregon’s elected leaders have understood the balance between protecting and improving the environment and growing and strengthening our economy. And our members are firmly committed to efforts that will effectively, sensibly reduce the environmental impacts resulting from transportation emissions. We agree that “aspirational” goals and targets give us all something to reach for. But in the final analysis, we need to look at the merits of each piece of legislation. And on its merits, SB488 would remove the sunset that was put in place precisely to protect against badly designed policies and programs.
Passing SB488, implementing bad policy and slamming companies around the state with an unworkable program will not help bring jobs back to our citizens. And it will not help protect the environment.
On behalf of Oregon’s slowly recovering construction industry, we urge the Oregon Legislature to vote No on SB488.