You will find very few Oregonians who have heard of section 179 expensing. It is literally buried in section 179 of the IRS tax code.
But if the 2011 Legislature ends up being what many of us have predicted – the most important and courageous legislative assembly in many decades – folks should remember section 179 expensing.
Why do we care?
Because today, in passing a minority report that connected Oregon’s tax code with the federal tax code, 41 out of 60 members of the Oregon House made a statement that this legislature will be different. The majority report that came out of the House Revenue Committee connected Oregon to most of the federal tax code but left out two tax incentives to stimulate private sector job growth: section 179 expensing and bonus depreciation.
Conventional wisdom in Salem is that minority reports never pass and they certainly never become law. Well, this minority report is on its way to the Senate where a vote will happen today and then Governor Kitzhaber stands ready to sign the bill in its current form, fully connecting Oregon to the federal tax code as of January 1, 2011.
If we are going to reset Oregon’s budget, the old rules of political engagement will not do. It will not be easy for legislators to vote to stop our overspending on corrections; it will not be easy to craft a balanced stability package that can both pass with super-majorities in the legislature and pass at the ballot box; and, it is not normal for a governor to sign the first important bill of a legislative session which comes in the form of a minority report. In fact, it has never happened.
This could be harbinger of big things to come. As we watch the discord in Wisconsin and the budgetary standoff in the nation’s capitol, we see that setting the right tone matters. Yesterday’s progress occurred because Democrats joined with Republicans. Tomorrow, or some day soon, perhaps we’ll see Republicans join with Democrats. Whatever the combination, we are encouraged by the new tone that emerged yesterday in Salem and we look forward to continuing our work with legislators to tackle the big challenges before us.
They can have their Wisconsin cheddar….we’ll take Tillamook cheese and a new tone in Salem.