It is a good time to update citizens on the status of Senate Bill 1528B in the Oregon Tax Court given oral arguments last Friday, remind everyone after East Coast hurricanes & the Substation Fire about emergency preparedness, and point out the likelihood of a December Special Session in Salem. If you are not interested in all the topics you can scroll to bolding to see an individual topic, or just hit the delete key as the State does not have the resources to save everyone anyway. Just kidding, but be prepared yourself as the cavalry is not coming for weeks.
SB 1528B Update.
I believe everyone on my Legislative email list knows the majority socialist Democrats passed a $1.3 billion dollar tax increase on Oregon small businesses in SB 1528B earlier this year. SB 1528 disconnected with the federal tax code opposite of the intent and purpose of Ballot Measure 2 adopted by the people of Oregon. It was passed in violation of four clauses of the Oregon Constitution but Portlandia does not care about the law. If you got $1.3 billion it would be a revenue increase to you. If you spent $1.3 billion without getting the vote of your wife, husband, or significant other, then you’d be in the dog house too. Then if you did an automatic withdraw from you bank resulting in an overdraft you could not argue it did not count until payday next month. Well that is what happen in the Oregon legislature without a single minority vote. Not one. So Senator Baertshiger and I filed lawsuit against the Governor, Senate President, House Speaker, and the Oregon Department of Revenue to stop the small business tax increase. Note big corporations got a free ride by the socialist Democrat majority. Remember, minority Republicans supported small businesses in opposing SB 1528. Remember, socialist Democrats supported big corporations with NO tax increase along with wiping out small business market shares in our local communities.
This past Friday, October 19th, were oral arguments in the Oregon Tax Court on the lawsuit. As a Legislator, my reaction was more than negative. In fact, it appears to me the entire Judiciary has no interest in the people of this State, only the views of fellow lawyers. Since I have seen this elsewhere in the Circuit Courts, and federal Courts, this was really just a confirmation, no citizen should expect anything good to come of their experience with the civil courts in Oregon. The Legislature created the Oregon Tax Court to be easy for citizens to navigate without quarter million-dollar lawyers. It is quite apparent the elite lawyers want to remain the aristocracy. While a few counties have Judges who try to represent the common people most only want to talk to other lawyers as us commoners are simply peasants to be avoided. No wonder Judges get elected with 18% of the vote on average. And yes, I am certain my newsletter will be used against me but somebody has to push back against the destruction of the State of Oregon. Yes, we can all sit back and watch Portlandia meltdown in riots and mob rule but that does not represent the rest of rural Oregon. Yep, the deep state goes to every city in Oregon, every County in Oregon, not just Portlandia and Salem. Though good people exist everywhere too, regardless of party affiliation, however, “evil prevails when good men do nothing … as you will ultimately be judged by what you do or failed to do.”
We have prepared a list of items we thought key from the lawsuit oral arguments that maybe were not apparent or maybe we should have done better. We have done this as the total filings from both the state proletariat and our side exceeds a thousand pages last count.
Here are my SB 1528 highlights:
Since Oregon and Indiana share constitutional revenue origination clauses, Indiana case law is important in that it points out the revenue origination cause in our matching State constitutions has not been breached in Indiana, as claimed by Legislative Counsel in Oregon. Any Indiana bill that even has a dollar value originates in the Indiana House Assembly. Indiana’s 2018 matching Internal Revenue Code (IRC) connection bill to the Federal Tax Cut and Jobs Act was House Bill 1316 originating in their House of Representatives.
Legislative Revenue Office originally, and currently, even in the reports at the oral arguments, list SB 1528B as a revenue gain not a loss. Legislative Revenue Office (LRO) does prepare session ‘tax expenditure report’ in coordination with the Office of Economic Analysis (DAS) that terms all changes in loss terms. Any actual or proposed addition subtraction deduction or credit is deemed a ‘tax expenditure’ meaning it is characterized as the State owns 100% of your income within the boundaries of the State of Oregon. Guess the state proletariat thinks they should get 100% of your income then give you crumbs back.
The Office of Economic Analysis (DAS) is required by law to prepare quarterly economic revenue forecasts. The legislature branch and executive branch are required by law to balance the budget based on these revenue forecasts. They are not estimates but requirements under the law to include kicker repayments. That the state proletariat claim these estimates do not matter is simply ridiculous.
SB 1528B requires an above the line amount to be added back to the Adjusted Gross Income in Oregon. It is not a normal tax ‘deduction’ as used in the course of Oregon law. The federal Tax Cuts and Jobs Act interchanges deduction with reduction to establish adjusted gross incomes. This is properly explained in the LRO Revenue Impact Statement and the federal code explanations.
The federal Tax Cuts and Jobs Act took effect January 1, 2018. At that moment, Article IV Section 32 of the Oregon Constitution made IRC 199A(a) an integral part of Oregon law. No action was required by the Legislature. Ballot Measure 2 made any legislative tampering a second step after automatic connections to the federal code. State’s argument to the contrary saying the federal laws is not effective until April 15, 2019 violates Priest v. Pierce, and any Ballot Measure 2 review by the court. If a taxpayer does not pay their quarterlies the IRS and DOR will fine the taxpayer for failure to pay. The State’s argument is simply a bold face lie is the face of these facts. Try telling a cop the speeding laws do not apply to you until next year … see how that works out!
The State’s argument that the ‘word of the law’ does not matter only the purpose as determined by the court is blatantly false. From 2005 until the replacement of Chief Justice Balmer, every Chief Justice has clearly stated the ‘common word of the law’ is the law. The Judiciary’s Priest v Pierce doctrine is based on examining each word of the very law the State proletariat claims does not matter now. This sounds like the state proletariat believes politically appointed judges should legislate from the bench to the benefit of the Governor.
The Priest v Pierce doctrine sets precedence for prior court rulings. An application of the pages 25 to 55 in Senator Boquist’s original filing sets out exactly how the OTC can apply the court’s doctrine in reaching the conclusion SB 1528 is a revenue bill that did not originate in the house chamber and failed to receive a super majority, and violated the true meaning of the constitutional automatic rolling reconnect.
In previous court cases, if one applies Justice Kistler’s written opinion in Bobo, along with Justice Kistler’s later written opinion in Seattle, an obvious path to overturning SB 1528B is realized. In fact, applying the Priest doctrine would dictate a reversal of SB 1528B as contrary to Bobo and Seattle. Justice Kistler outlines a process to define ‘revenue’ bills in Bobo on pages 6 and 7. SB 1528B meets Justice Kistler’s definition of a revenue bill. Bobo is about mixing federal funds into the general fund then wrongly thinking somehow federal medical funds are state revenue. Justice Kistler correctly opines on page 8 of the ruling SB 963 in Bobo is not a new tax, a tax increase, or even a fee. In Seattle, Justice Baldwin makes the argument correctly the issue in Seattle is the application of an existing tax as to whether both taxpayers must pay the same tax. Justice Baldwin cites equity between two similar taxpayers. SB 1528 has no two similar taxpayers, no existing tax, and no equity between two types of businesses, as small businesses are taxed while c-corporations are not. Hence, SB 1528 is inequitable as it creates a new tax applied to the disadvantage of one business type over the other. However, Justice Baldwin cites Bobo, only once in determining the formula established by Justice Kistler in Seattle. Justice Kistler then opines in part and judgement in Seattle by clarifying his rational from Bobo in applying it to Seattle. By applying Justice Kistler’s opinion, with Justice Landau, in Seattle it is easy to conclude the differences of indirect taxes, direct taxes, income taxes, the existing property tax issue in Seattle, verses the difference in SB 1528 creating a new revenue and tax in SB 1528. The way forward for the court is not around Bobo and Seattle but through both cases by analyzing the common characteristics then applying them to the income tax in SB 1528B. This might not have been conveyed as well as needed in the courtroom last Friday.
Lastly, failing to mention the State proletariat position that legislators who vote against a bill adopted by the majority should have no consideration or merit before the court is unconstitutional in itself. The notion a ‘no’ vote by a Legislator eliminates their standing is nothing more than tyranny. That a bureaucrat of the state proletariat would say this in a courtroom, clearly means Oregon faces taxation without representation. The Deputy Attorney General no doubt represents the views of Governor Brown, Senate President Courtney, and House Speaker Kotek. The whole basis for the American Revolution is put before the people of Oregon just like in 1776. Tyranny of the state proletariat is a greater threat than even SB 1528. If Legislator’s representing their constituents and districts should be given no consideration or merit then there is no need for the Legislature at all. The court needs to consider whether it will consider the voices of all the people, or only the ruling elite in the state proletariat. It has come to this.
None-the-less in regard to the afore-mentioned highlights, we are hopeful the tax court judge will see through the smoke screen of the state proletariat in applying the Oregon Constitution fairly in this case. Constitutional court opinions say even if a doubt exists, the law should be applied in favor of the citizen not the government.
You can see our various filings on SB 1528B on the links on my webpage:
Now something that should interest everyone.
The Substation Fire in July and August started just outside of The Dallas next to the Cello Switch Station & Big Eddy Transformer site in tall dry farm crops. It easily could have damaged the substation or power grid in a very detrimental way. Hurricane Florence on the East Coast last month could have put power out on the East Coast for weeks. We should all be reminded of Ted Koppel’s bestselling book ‘Lights Out’ as he describes how a cyberattack or other similar event could easily cut power for weeks if not months to large parts of America. Such an outage could be caused by cyberattack, simple computer failure, sabotage, environmental or other terrorism, foreign attack, or the Cascadia event. This Summer’s wildfire should be a wakeup call to everyone to be prepared for at least 21 days without power. Also of note, the gas price spike the past two weeks after the natural gas line explosion in British Columbia cut production supplies and slowed road construction in Oregon. Again, plan for at least 21 days without power.
What does 21 days without power mean. No electricity. No heat. No refrigeration. No computers. No game stations. No social media. No cell phone service after a matter of hours. No working gas pumps. Only the fuel in your car. No water once gravity runs out. No sewer service in some areas. No stores open that use electricity. No truck transport. If this is coupled with an earthquake like Cascadia or even a foreign attack then all these impacts could be doubled or tripled quickly. While the state and federal governments, with volunteers too, have developed some plans, the fact is locally nobody may be able to reach you, your family and your community for weeks. Recall the closest petroleum sources are in Utah but they only have 5% excess capacity. Salt Lake City is 765 miles away with little in-between that will not be impacted.
What can you do. Prepare a little every month. Preparing is not costly. Start by making a list of what you have on hand even if only a mental list of clothing, blankets, water containers, medicines, flashlights, candles, pots, and other common items. Look in the cupboard for types of food that would last weeks if not months. Maybe a trip to the Dollar Store would give you good ideas. Think how you will cook or heat your food. Maybe a camp stove from Walmart, or the house’s wood stove. Or an outdoor tripod over an open fire, my wife calls this enhanced camping. What about sanitation without water. Like handy wipes and toilet paper. Surprisingly, most items you might need for 21 days to a month without power are pretty common and inexpensive. The Red Cross has lists of good ideas online but my favorite link is below.
Last time I raised emergency preparedness with constituents many folks said it was alarmist or would never happen. If you did not see Hurricane Florence on the news google it. Or google Ted Koppel’s Lights Out. You should think about security too. If you do nothing to help your family or yourself it will simply increase the weight on others. Indeed, you could help others.
Nothing like an emergency to cause a special session of the legislature. We have an emergency clause in the Oregon Constitution but that is not the type of special session or emergency I’m talking about today.
The U.S. Congress generally has a lame duck session in December every two years in the nation’s Capitol. If we have a lame duck Governor then the only way the Portlandia based majority can pass its environmental agenda, carbon tax, corporate tax, your personal taxes, and anything else they want on pure party lines is to have a special session in December. The Portlandia leftist majority can do this around December Legislative Days then have Governor Brown sign the bills before she leaves office.
Also, if the Portlandia majority is worried about the courts pushing back on their unconstitutional passage of any tax bill on a vote of 16 Senators and 31 State Representatives verses the constitutionally required super majority, they could easily want a December special session to pass their bills before the court rules on SB 1528. Simply pointing out the sort of political shenanigans that could happen before Christmas. Fine lumps of coal.
Be safe, serve your family and neighbors. Be aware, as my wife says ‘stay alert, stay alive’ as Oregon needs all of you.
Hope this update helps you a little.
Brian J. Boquist
Oregon State Senator