2016 will bring stable economy, wild politics to Lane County

January 3, 2016 - Register Guard

Wondering how 2016 will play out? In some ways, probably much the same as 2015 did. But there will be many wild cards. On the cornerstone issue of the local economy, expect stability with continued slow job growth and a stable real estate market.

But in the political sphere, expect a frenzy. Contentious ballot measures are headed for the November statewide election — including a large corporate tax increase, two different minimum wage increases, a repeal or weakening of Oregon’s “Clean Fuels” law and, ­potentially, an anti-union “right-to-work” proposal for public employees.

Throw in the presidential race — with the Oregon primary in May — and you’ve got a wild year.

Plus, Oregonians will vote on a governor in November — with choices including Democratic incumbent Kate Brown, who took over temporarily from the departed John Kitzhaber — and ­others who still are lining up.

The Oregon ballot measure fights, which will generate heavy political spending, probably will overshadow Brown’s bid. Brown has not yet drawn a well-known challenger in the race to serve out the remaining two years of Kitzhaber’s term. A close-fought statewide race is expected, however, for the open secretary of state post, which will feature two contested primaries in May. Two Lane County politicians, Democratic state Rep. Val Hoyle and Republican Lane County Commissioner Sid Leiken, have thrown their hats into the ring.

The November election also will see Oregon Democrats pushing to gain the one House seat they need for three-fifths supermajorities in the House and Senate in Salem, which would allow them to raise taxes without GOP support. Oregon Republicans, meanwhile, will look for a bounceback year after disastrous elections in 2012 and 2014.

State lawmakers may try to use the short Salem session in February to avert what one called a potential “Armageddon” in November between business and organized labor over the proposed $2.5 billion-a-year corporate tax increase and the $15-an-hour minimum wage ballot measures. Some moderate Democrats argue the Legislature should send its own compromise measures to the November ballot.

Lawmakers also will weigh a request for $45 million in state money to subsidize the 2021 world track and field championships in Eugene in February. That effort, which could involve doubling the state tax on hotel stays, probably will face extensive scrutiny from lawmakers outside of Lane County.

Legislators also will consider measures to ease the high cost of housing in urban areas across the state, and Portland in particular. Among the concepts favored by advocates: lifting the state ban on cities requiring developers to include subsidized units in their buildings, a short-term ban on no-explanation evictions and more money for low-income housing projects.

Moderate growth on horizon

Amid the political hoopla, look for a steadily improving economy in Lane County.

Local economists predict Lane County’s economy will continue to improve in 2016, with a boost in manufacturing employment in 2016 and beyond, thanks to the reopening of the Swanson Group plywood mill in Springfield in 2016 and the addition of RV maker Winnebago in Junction City and chip producer Avago Technologies in west Eugene.

Iowa-based Winnebago has said it plans to phase in production of diesel vehicles at the previously empty Junction City plant during the next 18 months, hiring up to 200 workers. Avago’s timeline for launching production of mobile phone components at the former Hynix plant in west Eugene is less clear, with no set start date. Avago bought the empty plant last year.

The economic slowdown in China and softness in the European economy still pose risks to the U.S. economy, and the potential damper of rising interest rates on the national housing market could hurt Lane County wood products makers that supply that market, said Brian Rooney, an economist with the state Employment Department. But “generally we would expect moderate growth to continue into 2016” for Lane County, he said.

Annualized employment growth in Lane County has been 2 percent to 2.5 percent for the past couple of years, and Rooney said he expects that to continue in 2016.

Tim Duy, an economist with the University of Oregon, also expects 2016 to look much like 2015. “We’ll have some further improvement in the housing market, particularly new construction, as a result of job growth and wage growth,” he said.

Duy also predicts that local housing prices will continue to rise in 2016 because of fairly solid demand, wage growth and the threat of inflation.

A new City Hall and mayor

In Eugene, the ongoing downtown facelift will continue, with the city of Eugene probably ­beginning construction of a new City Hall and Whole Foods opening its under-construction store.

The City Council will decided whether it wants to put Broadway Plaza, more popularly known as Kesey Square, up for sale, and the redevelopment fate of the current Eugene Water & Electric Board property along the riverfront in downtown ­Eugene may come into focus.

Meanwhile, voters will elect a new mayor to replace the long-ensconced Kitty Piercy, who is not seeking reelection to the post she’s held since 2005.

Lucy Vinis, a ShelterCare executive; former Eugene Water & Electric Board Commissioner Bob Cassidy; and Eugene resident Stefan Strek have filed to succeed her. Eugene City Councilor Mike Clark also is mulling a run. The primary is in May. The filing deadline is March 2.

Construction of the new City Hall is set to begin this summer, said Jeff Perry, the city’s facilities director. The design for the roughly 30,000-square-foot structure, which will be built on the western half of the downtown site that housed the old City Hall, is nearly complete, he said.

The building will be four stories tall and house the City Council chambers, offices for councilors, the city manager and his staff, meeting rooms, and a public lobby and exhibit space. Completion is set for late 2017.

Eugene city officials are poised in 2016 to take the reins of the proposed redevelopment of the EWEB riverfront property.

EWEB commissioners will vote Tuesday on “deal points” to guide two agreements, the first for the city to become the lead negotiator for the property, and the second an exclusive negotiation agreement between EWEB, the city and Portland developer Williams & Dame.

The City Council also is expected to decide this year whether to sell Broadway Plaza to private developers. A local ­development group has proposed buying the plaza and developing a five-story building with apartments and retail on it.

Many residents have objected to the proposal, decrying the loss of public space in the heart of downtown.

In response, city officials have asked for other ideas for ­redeveloping the plaza. The deadline for submitting “expressions of interest” is Jan. 15.

Difficult budgeting ahead

Meanwhile, Lane County government, chronically financially strapped, is anticipating another year of difficult budgeting in 2016. Gaps between expenses and revenues are expected in the county’s general and road funds for the fiscal year that starts in July. Those gaps are partly caused by the county’s desire to wean its budgets off temporary but potentially renewable timber payments from the federal government. For the second year running, the county expects it will use its federal timber funds to pay down construction debt — a move that gives more long-term stability to its budget, County Administrator Steve Mokrohisky argues.

Mokrohisky said he hopes to avoid big cuts in services through targeted spending reductions — on the county’s vehicle fleet or information services, for example — better management of lawsuits filed against the county and better management of workers’ compensation claims, and eliminating some ­vacant positions.

Also in 2016, the county will revive talks with the city of Eugene about a possible downtown land swap. The exchange, first broached in 2014, could allow expansion of the Lane County Farmers’ Market, while providing space for a new Lane County courthouse.

County officials also hope to complete, with the help of an outside consultant, a long-term management plan for county parks, after an initial draft in 2015 drew heavy public criticism.

UO has its eyes on deans

At what is arguably the Eugene-Springfield area’s single biggest economic driver — the University of Oregon — Michael Schill is settling in as president.

Among Schill’s preoccupations in the first half of 2016 is to stop the destabilizing churn at the senior level of academic leadership at the UO.

Of the 10 deans overseeing the university’s academic enterprise, all but one post has turned over since mid-2013.

Besides Dean Michael Moffit, who has headed the law school for five years, the academic dean posts at the UO have run for years on an “interim” basis.

Now, Schill is setting out to shape the UO by hiring permanent deans for the UO colleges and schools that educate most UO students: arts and sciences, business, architecture and journalism.

In addition, he’ll hire a new vice president to oversee the UO’s research.

“This will be — really, for a generation — a very, very important moment on campus,” Schill told the UO Board of Trustees in December.

The university’s goal is to fill those top posts — which rank third in the academic chain of command — by fall 2016. “All of the (hiring) committees have been formed, all of the positions have been posted, advertisements have been placed,” Schill said.

In February, the search committees will interview many candidates and choose three finalists for each position. Then, the 15 finalists each will spend two days on campus, meeting with faculty and administrators, during April and May. “We charted it out one day. It was a little bit scary,” Schill said.

The new deans will preside over a largely level student body. Enrollment declined for a third year this fall, but by less than 1 percent — with a total of 24,125 students now enrolled.

In addition to hiring deans, Schill said he hopes to increase the tenure-track faculty by 20 to 25 this year. Counting replacements, 40 faculty searches are underway this winter.

The key post of dean of the College of Arts and Sciences has been in the hands of an interim caretaker since Scott Coltrane became interim provost in July 2013, and later interim UO president. The college calls itself the “heart and soul” of the UO; it grants two-thirds of all UO undergraduate degrees and provides reading and mathematics courses for many others.

Nearly 13,000 undergraduates are studying in one of the college’s 46 majors, and an additional 1,300 graduate students are in the college, too. The College of Arts and Sciences dean oversees 900 faculty and 200 staff.

The UO School of Journalism and Communication also has been overseen by an interim dean since 2013, when long-time Dean Tim Gleason stepped down. The school enrolls 2,100 undergraduates and 125 graduate students in journalism, advertising, public relations and media studies.

An interim dean has overseen the School of Architecture and Allied Arts since August 2014 when then-interim UO President Coltrane made Frances Bronet interim provost. She later left the UO.

About 180 faculty teach about 1,500 students majoring at the Architecture and Allied Arts school. The deadline for a prospective dean to apply is Jan. 8, 2016.

The last unit to enter interim management was the Lundquist College of Business, when Dean Kees de Kluyver stepped down in September 2015. The college’s 103 faculty teach 4,500 undergraduate and graduate students.

A must-have skill for all the dean positions is an ability to succeed in what Schill calls “our wildly ambitious $2 billion fund-raising campaign.”

The campaign, as of Nov. 30, has raised $886 million, Schill told the UO Board.