The Price of Mismanagement: Assessing the Impact of Measure 101 (Part 3)

March 14, 2018

 

Last week, I discussed how Measure 101 is devastating Oregon healthcare, as local hospitals are trying to stay afloat amid capsizing taxation.

 

Hospitals aren’t the only ones taking a hit from Measure 101 though.

 

That’s why I felt it was necessary to include this third and final installment of the series that covers the Measure’s effects on our education system and economy.

 

Both of these sectors are invaluable to our state’s future. However, with the staggering costs Measure 101 imposes on them, it’s uncertain how Oregon will fare in the years to come if we cannot find a more sustainable solution to paying for our healthcare.

 

Here’s how these taxes are impacting our state’s schools and economy.  

 

Overwhelming Students and School Districts

 

Because of Measure 101, K-12 schools and an estimated 12,000 college students will absorb the costs of $25 million in healthcare taxes.

 

These costs are especially straining for the college students who are already seeing substantial tuition increases, as a result of state funding cuts to many local universities and colleges.

 

As one student said, “An $81 per year new tax for student health plans might not seem like a lot to politicians, but for students every tuition and fee increase puts us at risk of dropping out because we can’t afford the high-cost of higher education.”

 

These taxes are overwhelming on every front of our state’s education system.

 

As school nurse Kim Bartholomew, R.N. noted, "$25 million of the new insurance premium tax will be borne by the K-12 public school system! In the school district where my son attends, that’s an estimated $660,000 in taxes this biennium.”

 

It begs the question: How can schools compensate for these exorbitant costs? The short answer is they can’t.

 

Oregon schools are already spread thin financially. Even after the $34 million the State School Fund received in marijuana tax revenue back in October, it’s hardly enough to cover operational costs and skyrocketing employee pensions.

 

Many districts have already been forced to trim their staffs and cut programs. The Salem-Keizer School District alone had to cut 67 teachers to free up more money in its budget.

 

With our school districts already struggling, the last thing they need is to take on another $25 million in Medicaid costs.

 

Crushing Small Businesses

 

College students and school districts aren’t the only ones feeling the pressure though.

 

Small businesses are getting crushed with these burdensome taxes, which has huge repercussions for Oregon’s economy. The state defines a small business as any company with a staff of less than 50 employees.

 

Bigger businesses aren’t exempt from taxation either, especially if House Bill 4105 passes. HB 4105 penalizes companies that offer health insurance to employees but have employees who double-dip between their coverage and federal medical assistance.

 

These laws are supposed to be a quick fix for our state’s budget deficit. But perhaps what makes them most problematic is the fact that they exempt Oregon’s biggest employers, like Nike, Intel and even the Oregonian.

 

The reason is because these entities are self-insured, create a lot of jobs and, at least in Nike’s case, threatened to leave the state if they weren’t given a tax break.

 

Meanwhile, our small businesses, which account for 99 percent of all Oregon companies and half of its workforce, are getting ruined by the high costs of employment.

 

Small business owners are struggling to provide health coverage for employees and stay afloat. Daniel Kintigh, owner of a local seedling nursery and Christmas tree farm, worries for the future of his company, saying:

 

In one year, our small group plan had a 73% cost increase. With the increase our premiums would potentially cost $50,000 a year to provide health insurance for the seven people on our small group plan...Big corporations can negotiate better insurance prices. Small businesses are stuck with very few choices, and ridiculously high costs.

 

Measure 101 is devastating our small businesses, which will inevitably lead to layoffs and economic disruption. We can kiss that historically low unemployment rate goodbye.

 

Can Oregon Recover?

 

If we cannot find more sustainable ways to pay for healthcare, our people will suffer.

 

Our access to affordable healthcare, our quality of education and our ability to work or provide work are all threatened by these punitive measures that are the direct result of irresponsible state spending.

 

Whether you believe healthcare is a right or not, Oregonians cannot continue to bear the exorbitant costs alone. After all, what good is universal health care if people are forced to sacrifice their quality of life to have it?

 

State lawmakers have promised that Measure 101 is only temporary; whether or not they’ll keep that promise remains uncertain.

 

There is one thing I know for sure though.

 

As an Oregonian from birth and the managing partner of a small business, I know that this great state has the resilience and communal support to overcome whatever challenges we face at whatever costs.

 

The people of Oregon are stronger than the powers that govern them. No matter how much state lawmakers exploit hardworking taxpayers and devastate our schools and businesses, Oregonians will emerge from this stronger and wiser than ever.

 

Our fierce, collective love for this state is what gives it a pulse—and nobody can take that away from us.

 

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