In 2019, HB 2007 was introduced by Representatives Tina Kotek (D-Portland), Karin Power (D-Milwaukie), Rob Nosse (D-Portland), Senators Michael Dembrow (D-Portland), Lew Frederick (D-Portland) and Kathleen Taylor (D-Milwaukie). It was an extensive bill aimed at eliminating diesel vehicles that pollute the air by producing carbon throughout the state.

At the time, the environmental groups came out strongly in support of the legislation. However, in an effort to reach bipartisan support, the bill was reshaped to focus on phasing out older diesel engines in the Portland Metro area ONLY. The compromise included retrofit and replacement of older on-road engines in heavy traffic areas, like the Portland area, while exempting agricultural trucks, log trucks and small truck fleets.

Two years later HB 2007 seems to have resurfaced as HB 2674. Again introduced by Representative Nosse (D-Portland). It appeared as a one page bill directing the Department of Environmental Quality to study the impacts of engine emissions on the environment and provide results of the study in a report to interim committees of Legislative Assembly no later than September 15, 2022. However, all that changed with the proposed -1 amendments also submitted by Representative Nosse.

The 48-page amendment to the original one page House bill, changes the intent of the bill from study of an issue to a mandated solution. The new intent is in the title of the amendments, the “Clean Diesel Engine Taxes.” The amendments propose the following:

• 3% excise tax on the retail sale of tires (Section 2)
• 1.5% privilege tax for businesses who sell or lease off-road equipment (Section 3)
• 1.5% use tax on off-road diesel equipment purchased outside Oregon (Section4)
• 3.5% rental tax for rental of non-road diesel equipment (Section 20 – amending ORS307.872)
• 2.0% rental tax for rental of all other qualified heavy equipment (Section 20 – would capture non-diesel heavy equipment)
• Privilege tax on light and heavy-duty motor vehicles (Section 23) with less than 7,500 miles on them. The taxes collected are allocated in the following manner:
  • Light duty vehicle tax goes to the Connect Oregon Fund (ORS367.080)
  • Heavy duty vehicle tax goes to the Clean Diesel Engine Fund (ORS468A.801)

The compromise in HB 2007 narrowed the scope of the legislation to just the following:

• Phase out of older medium and heavy duty on road trucks in the Clackamas, Multnomah and Washington County
• Prioritize ~$53M of the remaining VW settlement funds to do retrofits and replacements of old diesel engines within the Tri-County area. Also allow for funds to be used for off-road voluntary construction equipment participation in the retrofit or replacement program. In addition, it exempts some small businesses with limited fleet vehicles and provides for a voluntary upgrade fund for log trucks
• Tri county areas with state public contracts over $20M need to ensure 80% of equipment used will be clean diesel beginning in 2022. This would capture large public projects like the I-205 Abernathy bridge and widening project, the Rose Quarter project and State 217 North bound and South bound projects.
• Finally, it established the Supporting Businesses in Reducing Diesel Emissions Task Force. The taskforce was to be made up of 11 members representing: Elected official of a government entity having jurisdiction in an area with elevated concentrations of diesel particulate matter; public members who represent organizations concerned with the impacts of diesel emissions on health and communities; public member who represents the trucking or freight industry; public member who represents a business that operates equipment that is likely to be powered by diesel engines; public member who represents contractors or businesses that retain the services of subcontractors that operate motor vehicles or equipment powered by diesel engines; and public member to represent the environmental justice communities.

The initial meeting of the taskforce was to take place in the fall of 2019 and make recommendations to the legislature no later than September 2020. The taskforce would be repealed as of December 31, 2020. The taskforce held four meetings and at the final one on August 28, 2020, they reviewed a proposed timeline for how to implement the intent of HB 2007.

Sep. 2020 File Rules with Secretary of State and begin public comment period
Oct. 2020 Public Hearing
Dec. 2020 DEQ Staff Report to Environmental Quality Commission
Jan. 2021 Environmental Quality Commission Action – The final Administrative rule was filed and effective January 21, 2021
Q1 – 2021 Outreach and Develop Program Materials
Q2 – 2021 Open Grant Program
Q2 – 2021 Review Applications and Award Funding

Although HB 2674 was filed before legislative session began, it was not filed on behalf of the Supporting Businesses in Reducing Diesel Emissions Task Force. In written testimony, Erin Hansell-Heideman a Morrow and Gilliam Co. Wheat Farmer and President of the Morrow County Wheat Growers agreed stating “I know that the year-long Diesel Task Force considered many of these taxes and chose not to proceed”. So, it is unclear who the driving force is behind this legislation, and why it was introduced now when HB 2007 is only in the outreach portion of the timeline and the grant program itself is not targeted to begin until Q2 of this year.

A D V E R T I S E M E N T

A D V E R T I S E M E N T

What is known is HB 2674 has drawn the attention of some of the same people that helped mitigate HB 2007 in 2019. On March 3rd, the bill was scheduled for a hearing in the House Energy and Environment Committee. However, it was never heard due to other bills that were scheduled for a work session that same day. The hearing had over 100 people submit testimony, and it was overwhelmingly in opposition to the bill. In written testimony Agelita Sanches, with Timber Unity reminded the committee that “This is a direct attack on farmers and loggers. Many of whom you exempted just a short time ago”. However, Jenny Dressler, on behalf of Oregon Farm Bureau Federation summed it up best in her written testimony when she said “OFBF opposes the proposed -1 amendments, which would levy countless new taxes on rural businesses—farmers, ranchers, and small woodland owners—in order to fund diesel engine replacement and retrofit in the densest areas of the state. Rural communities aren’t responsible for Portland’s air quality, but the -1 amendments to HB 2674 puts that responsibility squarely (and inappropriately) on our members’ shoulders. The proposed -1 amendments taxes our tires, our farm equipment, our trucks, and the dyed diesel used in off-road equipment to grow food and fiber.”

As Legislative session moves towards the March 19th deadline when bills must be scheduled for a work session so that they may be moved out of committee to their chamber floors by April 13th, it will be interesting to see if HB 2674 receives an actual hearing, a work session, or is again amended and morphs into something different.


--Terese Humboldt

Post Date: 2021-03-11 09:05:31

Last Update: 2021-03-11 09:32:49