On October 3, the Oregon Legislature passed a set of bills that makes changes to the Public Employee Retirement System (PERS), increases revenue, and provides additional funding for education (including $25 million for the Oregon University System), mental health services, and senior services. The major components of the package of bills passed are outlined below.
SB 861 sets the PERS cost of living adjustment (COLA) rate at 1.25 percent for benefit payments up to $60,000 and 0.15 percent for benefit payments above $60,000 starting on July 1, 2014. The bill also requires a 0.25 percent supplementary payment, capped at $150, to all PERS members or their beneficiaries. An additional 0.25 percent supplemental payment will be made to retirees whose pensions are less than $20,000. Supplemental payments will sunset on December 31, 2019.
SB 862 excludes salary increases made in lieu of insurance coverage from calculation of final average salary for determining long-term pension benefits. It further removes future legislators from PERS and prevents some convicted felons from receiving benefits.
HB 3601 changes tax rules, raising taxes on cigarettes, certain corporations and high income earners. It includes adjustments to Oregon's senior medical deduction, a higher tax rate for "C corporations," the removal of the $183 personal exemption for taxpayers earning over $100,000 individually or $200,000 jointly, and a 13-cents-per-pack boost in cigarette taxes. The bill also cuts rates for partnerships, limited liability companies, S corporations, and certain export businesses.
HB 5101 appropriates $140 million for education, $10 million for mental health programs, and $41 million for senior programs. It includes $25 million for a tuition buy down at OUS institutions. A budget note attached to the bill calls for the OUS allocation to be used to keep increases to the base rates per credit hour paid by resident undergraduates under 2 percent for winter and spring terms of 2014 on all seven campuses. The budget note further calls for no increases in the base rates for resident undergrads for the 2014-15 academic year. The Oregon University System issued a statement praising the Legislature for the added investment.
A final bill, SB 863, limits local government regulation of genetically modified organisms.