“If their tracks need repairs, it’s their job as a business, not ours as taxpayers, to fix them.” Jody Wiser, Tax Fairness Oregon, Willamette Week, Feb. 8, 2012.
“Gravy Train,” the recent Willamette Week story by Kara Wilbeck, notesthat last year, Union Pacific Railroad had profits of $3.3 billion. Yet since 2006, under a law stating that Oregon should subsidize transportation businesses that “lack capital,” the state has already handed out $24.7 million tax dollars to this corporate giant.
The current legislative session in Salem is slashing school budgets and senior services, potentially closing a jail and counting every penny. ButHB 4028A is trying to add another $10 million to the $40 million already in the fund called “ConnectOregon,” for gifts to businesses and to public entities for multi-model (non-highway) transportation projects.
Of the 69 grant applications – most ask the public to do most of the spending
· 48 are for grants where the project owner will pay 25% or less of the project cost. Thus the public through ConnectOregon will be covering 75% or more of the cost.
· 11 applicants will cover 25% to 50% of cost.
· 10 applicants will cover 51% to 75% of the cost.
Of course there may be other grants or loans coming to the project owners from other sources, which would further reduce their own contributions.
Of that additional $10 million for ConnectOregon, $8.2 million could go to UP. The gravy train just keeps rolling along.
Why is UP once again seeking Oregon subsidies? The corporate giant’s mouthpiece Aaron Hunt answers in discredited terms that should make taxpayers grab for their wallets: the corporation just “wanted to partner with the public” and create “trickle down throughout the economy.”
This is the type of taxpayer rip-off that giant corporations like to arrange behind the scenes, even as their mouthpieces are complaining about “big government.”
In this short session, the next decision point in the state legislature is coming right away in the Capital Construction Sub-Committee of the Ways and Means Committee. Legislators there could add the extra $10 million--but passing out more cash to corporations is not acceptable.
Please phone or email one (or more) of the committee members now and say “NO” to the $10 million ConnectOregon allotment in HB 4028A. Tell them to use our tax dollars to pay teachers to teach, not to pay for corporate-owned railroad tracks. Thank you.
Click here for talking points and the phone numbers and e-mail addresses of committee members.
Tax Fairness Oregon
Tuesday, February 21, 2012
The Great Train Robbery ... By the Trainsters at Union Pacific, trying to hold US up!
House Bill 4028A: Oregon’s Union Pacific Gravy Train
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2 comments:
Maybe I'm missing something, but the House amendments on 4028 look to be a bunch of spending on Community Colleges - not $8.2M for UP etc.
From TFO website:
HB 4028 A — the lottery-backed bonds bill
We support bonding for the other two parts of HB 4028A: workforce buildings for community colleges and loans for water and sewer projects.
We’ve questions about the rationale for 10 million dollars in grants to ConnectOregon.
The ConnectOregon program is a nearly all-grants program, why are these not loans?
Loans are repaid by the recipients while grants starve the General Fund for 20 years.
In the name of the physical transportation infrastructure we are starving our intellectual infrastructure.
The public is funding up to 80% of costs for private business maintenance, upgrades and expansion projects. Just as doctors buy the equipment they need for their clients, rail, forestry, and private ports and airports should take care of their own facility needs. HB 4028 A includes loans to public entities for water and sewer but gives outright grants to private and public entities for multimodal transportation projects. Each of these entities has the capacity to repay loans via collections from their clients.
If we have money to give away, why not for clean water rather than upgraded loading equipment, airport hangers and private docks?
Connect Oregon IV Applications – 70 applications, for a total of $84 million
$3 million in 1 loan application for 100% of a project by the City of Central Point
$81 million in grant applications
$33 million in grant applications for 22 private profit-making businesses
$48 million in grant applications for 47 public entities
The $10 million in HB4028 would be added to the $40 million already allocated to ConnectOregon by the 2011 legislature.
Union Pacific asks for $8.2 million for 50% of the cost of a bridge replacement. UP is the largest freight railway in the U.S. with plans on spending $3.52 billion in capital investments in 2012.
BNSF seeks $3.9 million of $4 million, 97% of the cost of Portland rail improvements. BNSF is owned by Berkshire Hathaway, which plans to spend $2.1 billion nationally on rail’s core network in 2012. [Perhaps someone goofed on the spreadsheet? The maximum is supposed to be 80%]
Sause Bros. LLC wants $1.2 million of the $1.5 million cost for heavy lift equipment. With 60 tugs and barges in Coos Bay, PDX and four out-of-state locations, why should the public pay for 80% of the cost of their equipment?
Teevin Brothers wants $2.8 million for a T-Pier, 80% of the total cost. “Business is booming” according to the owner of this trucking, railing, and barging business, which built its own export dock on the Columbia in 2005 for $1.8 million. Why shouldn’t they pay their own way again?
Roseburg Forest Products seeks $4 million to expand UP’s rail line. The public would be paying 46% of the $8.8 million cost to help UP and Roseburg Forest Products, the largest freight rail and one of the largest privately owned wood-products companies in the United States.
All of these companies are well established, they are not start-ups. The state should be the lender of last resort not the donor of first resort. It’s time for sidebars and scrutiny, not more handouts.
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