Industry, Political Action Committees Spend Big to Defeat Cap and Invest

Industries with something to lose from a cap and invest bill are pouring money into political campaigns

Although Oregon’s cap and invest climate change legislation stalled in the state Legislature in 2018, climate legislation is the on the docket for the 2019 session — and political action committees (PACs) that represent big industry as well as companies themselves are shelling out money hand-over-fist to candidates who object to the bill. 

If passed next year, cap and invest, which was known as the Clean Energy Jobs bill in the last legislative session, could have significant financial effects on Oregon businesses that emit greenhouse gases. Cap and invest would set a cap on the amount of carbon that businesses can emit.

The legislation proposed last year allowed for businesses to emit less than 25,000 tons of CO2 per year, and would require larger greenhouse gas emitters to purchase “pollution permits” for every ton of carbon emissions over the 25,000-ton limit. Eventually, the cap would be lowered. 

The long-term plan for revenue from a cap and invest bill would support developing more renewable energy resources, such as solar and wind powered electricity. Additionally, subsidies would be given to rural communities to offset the costs that the program would have on rural industries. 

Several interest groups, such as Oregon Business and Industry, have spoken out against last year’s cap and invest bill. The people behind Oregon Business and Industry aren’t only making statements. They’re speaking with their checkbooks, too. 

Since January, Oregon Business and Industry’s Candidate PAC has given $297,500 to both Democrats and Republicans in Oregon. 

The Oregon Business and Industry’s PAC backs candidates skeptical of the legislation, such as state Rep. Richard Vial, who represents Oregon’s 26th district. As of August, Oregon Business and Industry’s PAC has given Vial $7,500. Vial says he has “significant concerns” about how the legislation would affect many industries because he does not know how the legislation will look. 

“Whether it’s a tax on carbon or a cap and invest type deal, it’s still completely up in the air based on the committee work,” Vial said. 

Vial adds that the cap would affect Ash Grove Cement, the state’s only cement manufacturing facility, located in Baker City. In September, the company gave $5,000 to state Sen. Fred Girod, who the Daily Astorian reports expressed concerns about how cap and invest would affect rural Oregonians. 

Ash Grove Cement also gave $3,500 to state Rep. Mark Johnson in January 2017 and 2018. He is a Republican from Oregon’s 52nd District who resigned in November of the same year to become the CEO of Oregon Business and Industry. Johnson was fired in April for making inappropriate comments at a private meeting, according to Portland Business Journal.

Although economists say a carbon tax would be the most efficient way to tackle climate change, it is controversial because of the increased cost to companies and possibly to consumers. 

Washington state proposed a carbon tax last year, but it stalled in the state’s Legislature.

Oregon Business and Industry spokesperson Tonia Holowetzki says the group is “deeply engaged in the conversation” about carbon legislation, and they are waiting to see what comes up in the next legislative proposal. 

The cap and invest model is popular among Oregon leaders. State Rep. Paul Holvey who represents Eugene, says he supports the cap and invest bill as opposed to another carbon reduction program.

“I find the cap and invest system to be more sympathetic to a market-based program, and that will largely eliminate the bad economic impact that a straight up carbon tax would cause,” Holvey says. 

Oregon Business and Industry’s PAC also gave $56,000 to state Rep. Jeff Helfrich and $51,000 to state Sen. Chuck Thomsen in 2018. Neither responded to Eugene Weekly’s request for comment. 

Brad Reed, a spokesman for Renew Oregon, a group that backs the cap and invest program, says it’s not surprising industry is spending so much. 

“There are certainly fossil fuel interests and they have an interest in stopping this bill because it holds them accountable,” he says. “It’s not surprising they’re spending on the campaign trail. We’re happy to work with any legislator who’s working to see the bill pass.”

Another industry that opposes the cap and invest bill is the Oregon Farm Bureau. 

The Oregon Farm Bureau PAC gave $2,500 to Helfrich in August and $3,000 to Thomsen between 2017 and 2018. Helfrich took over for Johnson after he resigned in 2017.

If there is one thing that is certain about the legislation, it’s that the debate will continue. Reed says the Oregon Senate president will keep pushing for cap and invest legislation. 

“The Senate president [Peter Courtney] said at the end of the 2018 session if you’re not interested seeing this again, don’t show up in 2019.”