Basin business mar 2016

March 2016

Basin Business

Thursday, March 24, 2016, Herald and News

KLAMATH BASIN

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Housing starts a sign economy is improving

Business

— Page 6

Chiloquin roasters KU takes awards at DECA — Page 4

Coffig for Life a small start-up brewing up big plans

Keeping business in Klamath

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— Page 3

Submitted photo

New name for hiring services — Page 6

Rosmarie Paul of Coffig for Life, hosts a display booth. The Chiloquin firm is seeing success in its coffee alternative drink.

A publication of the Herald & News Chamber: www.klamath.org

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Thursday, March 24, 2016, Herald and News

Basin Business

Coffig for Life

New product from the Basin

By GERRY O’BRIEN H&N Editor

CHILOQUIN — When William Paul was serving as a Seventh-day Adventist missionary in South America for, he came across a drink the locals had that was made from figs.

“It was some 20 years ago that I was given a fig or fruit drink and said, ‘Wow, this is wonderful.’ I thought it needed better marketing, better education of the public.”

Today, Paul, 53, and his wife, RosmaA reception for Coffig rie, operate for Life will be at 8 a.m. a small fig today in the Klamath roasting shop County Chamber of Com- in Chiloquin merce lobby, at 205 River- and turn out a powdered form side Drive.

A marketing display for the Chiloquin company. of black figs from Califorfamily, then California and then Chiloquin. nia. Their product is called Coffig for Life.

“I didn’t want to live in central California and “We started to make it in 2007 in the shadow of someone suggested Klamath County,” Paul said. the Andes Mountains. The drink itself goes back In 2014 they moved to Chiloquin to set up shop. to the time of the Spaniards. Even Nordic and “We roast the figs here using a special techJewish people have a similar drink made from dry nique. If you don’t understand how to roast and legumes or fruits. They used to grind them up in the wintertime and mix with hot water for a warm grind figs, you can ruin it pretty quickly.” The couple needed special roasters and grinders. Their drink.” shop is about 3,000 square feet a stone’s throw Coffig for Life is made from Black Mission figs from the Chiloquin Post Office. grown in the central California valley.

“We’re basically the only ones in the United Unable to franchise the product in South AmerStates doing this,” he said. ica, the couple moved to Orlando, Fla., to be with

Reception

The resultant dried powder is all natural, gluten free, slightly sweet and caffeine-free.

“A lot of people would frown on using dried figs as a replacement for coffee. But once you try it, you’ll never frown again. It’s very flavorful and has a lot of health benefits,” Paul said.

“Plus you can add it to coffee to cut down on your caffeine usage.”

“It’s a natural energy product that has its own natural punch.

It’s nice, never creates acid stomach,” Paul said.

The product yields two to A 1920s roaster is one of three times more two employed by Coffig. per scoop than coffee, Paul said.

It can be brewed, percolated, placed in K-cups or strained. The firm makes it in tea bags as well. It can be added to foods, such as ice creams, smoothies, cookies and brownies.

“It has all good benefits that figs have,” Paul said.

Coffig comes in two sizes: A standard 7.55 oz. bag will brew 142 cups of product and sells for $14 retail. The smaller, 3.52 oz. pouch brews 65 cups and sells for $7.99. Tea bags come in cartons of 14 and can brew up to 45 cups and sells for $6.75 retail. The firm sells the product on line at coffigforlife.com and it is available at Sherm’s Grocery stores, Gypsy Chix in Downtown Klamath Falls.

Coffig is available at Sherm’s Thunderbird as well as Gypsy Chix in Klamath Falls.

Submitted photos

ABOVE: The finished product. AT LEFT: One of two roasters used by Coffig employees at its Chiloquin site.

Basin Business

Thursday, March 24, 2016, Herald and News

Keeping businesses in Klamath County key At the Klamath County Economic Development Association (KCEDA), our new website — www.ChooseKlamath.com — is designed to encourage new businesses to plant their roots here in Klamath County.

However, we also have a program dedicated specifically to retaining the businesses that already call Klamath County their home: the Business Retention and Expansion (BRE) program, led by Rick Abel, our business development and retention manager.

The BRE program was established at the end of 2015, and was born out of some deep needs we have identified within the local business community.

Through this program, we hope to: n Strengthen existing companies in Klamath County; n Establish early warning systems to flag at-risk businesses that require our assistance

n Ensure that our economic development programs adequately serve our local businesses.

To address these needs, Abel and his BRE team are implementing a mechanism for linking expanding businesses with local economic development resources.

Those resources include: n Viable loan programs; n Small business assistance; n Technical assistance.

Meanwhile, KCEDA continues to work on unique solutions to the issues and opportunities that Klamath businesses face.

In talking with our local business owners, we have received feedback on a variety of concerns.

Just some of the needs local businesses have shared with us include: n Assistance with workforce issues for staffing. Requests for assistance on connecting with local career education programs repre-

sents 30 percent of all business owner requests.

To meet this need, we remain solidly partnered with Oregon Tech, Klamath Community College and O’Sullivan local job training programs. n Assistance with identifying funding. Whether it’s through small business loans, angel investors or other types of capital formation providers, 18 percent of our small business requests involve funding concerns. Our BRE program is committed to finding those funding solutions for local businesses. n Assistance with government connections. Specifically, Klamath County businesses want new ways to connect with local and state service providers, whether it’s South Central Oregon Economic Development District (SCOED), Oregon Small Business Development Center

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(SBDC), or Business Oregon. They are also interested in making federal connections, such as with the Small Business Administration (SBA). Our BRE program can help them with this.

If you are a Klamath County business owner interested in any of these services, feel free to contact Rick Abel by email at rick@teamklamath.com or, reach him by calling (541) 882-9600.

We are proud of the job that Rick and others on the KCEDA team are doing when it comes to business retention and expansion. After all, it only makes sense to bring new businesses to our area if our existing businesses are satisfied their needs are being met.

Greg O’Sullivan is executive director of the Klamath County Economic Development Association (KCEDA).

Team Klamath can be reached at (541) 882-9600.

Klamath Basin business briefs Pacific Power details hidden benefits of energy efficiency

Energy Trust at 866-368-7878 or visit Pacific Power at bewattsmart.com.

With energy upgrades, the benefits go far beyond lower utility bills. Here, Pacific Power helps you uncover ways that investing in energy efficiency can pay off.

1. Better customer experience. Lighting and HVAC upgrades can enhance the appearance of your business and create a more comfortable atmosphere. Customers stay longer, spend more money and come back more often.

2. Higher productivity. A Carnegie Mellon University study found energy-saving measures resulted in individual productivity improvements of 10 to 15 percent.

3. Improved product quality. High efficiency lights typically increase light output and enhance color quality. Benefits include less waste, lower rework costs and higher customer satisfaction.

4. Healthier indoor environment. Energy-saving improvements, such as natural ventilation and daylighting, can improve indoor air quality and enhance the overall work environment.

5. Safer workplace. Brighter lighting and more uniform light distribution can reduce the chance of a mishap.

Pacific Power teams up with Energy Trust of Oregon to offer services and incentives for energy efficiency improvements. Before starting your project, call

Waste Management given ethics award for ninth year in a row For the ninth straight year, Waste Management has been named one of the world’s most ethical companies by Ethisphere Institute.

The “World’s Most Ethical Companies” list recognizes companies that demonstrate superior achievement in ethical business practices. The list is published annually by the Ethisphere Institute, a global organization focused on defining and advancing ethical business practices.

Waste Management is a Fortune 500 recycling and environmental services company that uses garbage to generate renewable energy.

In Oregon, Waste Management provides recycling and garbage collection while also operating a Gold LEED certified recovery facility in Hillsboro, regional landfills in Yamhill and Gilliam County, and renewable energy plants that generate enough electricity to power 15,000 homes.

“Ethical business practices are at the heart of everything we do,” said Adam Winston, Waste Management’s director of operations for the Pacific Northwest. “This honor belongs to Waste Management employees at every level of our organization.”

FREE EMAIL OR PHONE ESTIMATES Serving Klamath & Lake Counties with over 30 years experience!

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Thursday, March 24, 2016, Herald and News

Basin Business

3D printing topic of IDEA Tech Talks 3D printing is the next wave in manufacturing. The next IDEA Talk will feature 3D design and printing guru Gerald Holt.

It will be at 6 p.m. Tuesday in the South Portal Building, 205 Riverside Drive, Klamath Falls.

Holt will share his insights and provide an overview of 3D printing and the current state of 3D technology.

He will also share best practices for using 3D printers in a product design process.

“We are returning to the South Portal Building to accommodate Holt’s presentation, which will feature live demonstrations of 3D printing and design,” said Rob Jellesed, Klamath IDEA coordinator.

“There is no cost, all ages are welcome, there will be good food and

Submitted photo

Samples of more simplistic 3D printer manufacturing.

beverages, and we are happy to have Mia & Pia’s providing a no-host bar.”

“The IDEA Talks are a great way to learn about starting a new enterprise or expanding a current busi-

KU students bring home DECA business awards Tuesday, Feb. 23, was a very special day for KU senior Vanessa Sanchez.

Entered in the state DECA competition know as SCDC (State Career Development Conference) located in Portland, Sanchez walked away with an amazing victory.

“She is the first KU student in the last 20 years to earn first place in all three components in her event,” said KU DECA coach Nat Ellis.

“Vanessa was amazNat Ellis ing.”

DECA is an international association of high school and college students in marketing management and entrepreneurship. DECA prepares emerging leaders and entrepreneurs for careers in marketing, finance, hospitality and management in high schools and colleges around the globe.

Sanchez will compete at national

DECA known as ICDC (International Career Development Conference) competition later this spring in Nashville, Tenn.

She will have to choose between the two events she the won at state.

“Each competitor who wins at state can only complete in one event at nationals,” Ellis said.

“I was so happy for myself and my teammates,” said Sanchez after celebrating her teams success. She will be joined by freshman Bailey Ellis who also made chapter history by being the first freshman to place in two events. Other award winners were Ellis’ older brother, Hunter, who is a junior at KU. “Bailey worked very hard and she really earned that award,” said Hunter.

The team is positioned to do well at nationals. “It is really amazing to just place at national,” Ellis said.

“And we have several teams members that we expect to do very well.”

The team was also awarded second place Oregon DECA Chapter of the Year.

ness, plan on staying late to network with fellow entrepreneurs, business owners, and the local support networks,” said Kat Rutledge, SBDC director and Klamath IDEA chair.

“Having someone like Gerald share his expertise in a casual setting is an opportunity we are proud to bring to the community.”

Holt began his career as a petroleum engineer where the experience of mentoring junior engineers sparked a passion for teaching. After nearly a decade, he left to pursue a career as an educator.

Holt taught several high school engineering classes where his work was recognized by the national leader in STEM education Klamath IDEA (Inspire Development and Energize Acceleration) is a non-profit community initiative dedicated to fostering and enhancing the entrepreneurial spirit in Klamath County. For more information call 541-884-8332, or check IDEA out online at klamathidea.org

KU DECA winners in Portland are, from left: Hunter Ellis, Josh Budden, Brin Rey, Bailey Ellis, Coach Nat Ellis, Vanessa Sanchez and Jacob Slinker.

Do you have some business news you want to relay?

Contact the Klamath County Chamber of Commerce at 541-884-5193 or the Herald and News at 541-8854437 and get into the next, monthly edition of Basin Business

Basin Business

Thursday, March 24, 2016, Herald and News

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Leadership conference available in Klamath Falls Leadercast is the world’s largest one-day leadership conference, broadcast live from Atlanta and simulcast to hundreds of locations around the world — including Klamath Falls — on May 6.

This year marks the 16th year of the annual leadership conference and the sixth year that the Klamath County Chamber of Commerce will be hosting the event.

This year’s event will be at Oregon Tech and is sponsored by Pacific Crest Federal Credit Union.

The theme of this year’s conference is “Architects of Tomorrow,” focusing on visionary leaders who imagine and build a future that is rich in innovation, collaboration and full of hope. A future where problems are solved, questions are answered, and confusion gives way to clarity.

The conference will equip attendees to create their own visionary path. Key speakers — visionaries in their own fields — will inspire the more than 100 people who attend locally, and the more than 100,000 people who will attend the event live in Atlanta or at hundreds of other simulcast locations in more than 20 countries.

Among the keynote speakers are: n Kat Cole — Group president of FOCUS Brands Inc. (including Cinnabon, Moe’s Southwest Grill, Auntie Anne’s, and more) n Steve Wozniak — Co-founder of Apple Inc.; n Henry Cloud — Acclaimed leadership expert, clinical psychologist, and best-selling author; n Nick Saban — Head football coach, the University of Alabama; n Andy Stanley — leadership author and communicator; n James Brown — Network broadcaster, CBS Sports and News; n Rorke Denver — Navy SEAL commander and author; n Chris Barez-Brown — Author and creativity guru; n Tripp Crosby — Host of Leadercast, comedian and director.

For years, Leadercast and the Klamath County Chamber have brought people together and equipped them to become better leaders, manag-

ers, community members, and employees. Here is what people have to say about Leadercast: “Leadercast was extremely informative and thought provoking. The Henley students stayed engaged and have already expressed interest in next year’s event.

“This is very encouraging to me since I believe we need to expose our young people to experienced, inspiring leaders as soon as possible to maximize their potential,” — Carla Yancey, Treasurer, Klamath Basin FFA alumni.

“With a constantly impressive lineup of speakers and the on-target themes year-over-year (and at such a value), I consider Leadercast a ‘can’t miss event,’ ” Janet Buckalew, vice president for member advocacy and business development for Pacific Crest Federal Credit Union and six-year Leadercast attendee.

For more information and to purchase your ticket or group tickets to the Leadercast Klamath Falls event, visit www.klamath.org or call (541) 885-5193.

Upcoming Chamber events Focus on Advocacy, Promotion and Education The Chamber is focused on advocating on behalf of business, promotion of your organization, and offering quality educational opportunities.

March, April, and May offer many chances to utilize your benefits!

Meet the Candidates Our Government Affairs Committee invites you to mingle and meet the candidates in the upcoming elections: April 6: Klamath County Commissioner Position 1 April 13: Klamath County Commissioner Position 3 April 19: Klamath County Sheriff

These events are free but we kindly ask you to RSVP to www.klamath.org Education Employment Law Series: Managing Social Media in the Workplace April 27 — 8 a.m. to 10 a.m.

The growth of social media — from electronic mail to blog postings to social networking sites — allows employers previously unheard-of access into the lives of employees and job candidates, but when should your organization use this access, and why?

What policies should employers have in place to protect against social media issues. Join us as Attorney Sean Ray explains how business owners,

management-level employees, and HR professionals can use social media strategically while avoiding the potential legal and managerial pitfalls associated with it. Register today. Thanks to BBSI for sponsoring this event.

Architects of Tomorrow: Leadercast 2016 Are you an Architect of Tomorrow? Do you have a clear vision of the future and are you leading the path? Visionary leaders have the ability to see a preferred future, operate in the present, and utilize the resources around them to architect a clear path to a new destination.

Join us May 6 for Leadercast 2016. Thank you to Pacific Crest Federal Credit Union for sponsoring this event.

Contact the Chamber Klamath County Chamber of Commerce

205 Riverside Drive, Suite A Klamath Falls, OR 97603 Office: 541-884-5193 Fax: 541-884-5195 Charles “Chip” Massie Executive Director cmassie@klamath.org

Heather Tramp: Marketing and Program Coordinator Email: heathert@klamath.org www.klamath.org www.facebook.com/Klamath Chamber twitter.com/AccessKlamath

Mark Fay, M.D. Scott Stevens, M.D. Physician/ Surgeon of the Eye Physician/ Surgeon of the Eye

Edwin Tuhy, O.D. Optometrist

Jennifer Sparks, O.D. Optometrist

New Patients Welcome

2640 Biehn St. • 541.884.3148 • www.klamatheyecenter.com

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Thursday, March 24, 2016, Herald and News

Basin Business

Elwood Staffing providing professional services Here in Klamath County, most folks are used to hearing the name “Hire Calling” or “SOS Employment Group.” The name has changed Elwood Staffing is now the name of that familiar face and together it has been providing staffing services to the community for more than 40 years.

Each company has brought several great things to the table. Elwood Staffing strives to continue that reputation. The group has five key beliefs that are standard to each and every employee and branch.

The key beliefs consist of: quality,

relationships, responsiveness, flexibility and progress.

“We do not see our associates or clients as numbers or statistics. We pride ourselves in conducting both business and associate relationships by these factors, which is why we are: The better people, people,” according to a press release.

The firm’s team members include: Lavonne Carleton who has been a part of the Klamath Falls branch for three years. Carleton is familiar with associates and clients from the SOS Staffing days.

“She always has a smile on her

face when interacting with people who come into our office. She has achieved the Certified Staffing Professional Certificate, making her savvy with employment laws and the progress of our office,” the release said.

Tamera Flescher joined the team in August of 2015. She is currently learning new endeavors within this industry to obtain her Certified Staffing Professional certification as well. Flescher is part of the marketing of the company brand throughout the community. She is introducing herself and Elwood to businesses.

The branch manager, Michelle Spendolini, is dedicated to providing support to her teams between Klamath Falls and Medford. She was welcomed to Hire Calling in 2006 and has stayed throughout the transition to Elwood Staffing. She started in the position of staffing manager and has worked her way to district manager.

Elwood Staffing is recruiting for various positions. Visit Elwood Staffing at 3815 S. Sixth St., Ste 150, Klamath Falls, or call 541-884-1410.

The office is open Monday through Friday from 8 a.m. to 5 p.m.

Western homebuyers pushing up new starts

By THE ASSOCIATED PRESS

U.S. homebuyers in the West accounted for all of February’s increase in sales of new houses, possibly signaling uncertain growth prospects for the broader real estate market heading into the spring buying season.

The Commerce Department said Wednesday that new-home sales rose 2 percent last month to a seasonally adjusted annual rate of 512,000. All of the increase came from 38.5 percent surge in purchases in the West, which reversed a stiff 32.7 percent decline in January that had cut into overall sales.

The rebound likely reflected a government report that can be extremely volatile on a monthly

basis, clouding some views of where the construction and housing markets are heading at the start of the most intense months for home sales.

“At this stage, it is unclear whether new-home sales are plateauing or are still in an uptrend,” said Joshua Shapiro, chief U.S. economist at MFR, a forecasting firm.

The U.S. housing market looks somewhat more tempered after strong growth in 2015. Sales in the opening two months of 2016 are running slightly below last year’s pace. Builder confidence has held steady despite a dip in sales expectations.

Purchases of existing homes tumbled in February, with the prior two months of healthy sales likely straining already tight supplies.

Price pressures are mounting as the share of

new homes being sold for less than $200,000 has declined so far this year, while the share of newhomes selling for more than $400,000 has risen.

New-home sales fell in the Northeast, Midwest and South in February. The median new-home sales price rose 2.6 percent from a year ago to $301,400.

The market still has yet to fully rebound from the housing crisis of nearly a decade ago. Newhome sales remain well below the historic 52-year average of 655,200, a figure that includes the build-out of the suburbs and influx of buyers after World War II. Subprime mortgages helped push up sales as high as 1.28 million in 2005. Sales of existing homes fell 7.1 percent last month.

Jobless report: Little growth, yet numbers improve Unemployment levels continued to tick down across South Central Oregon despite little job growth from area nonfarm businesses, perhaps an indication of an improving agricultural sector.

Klamath County: The seasonally adjusted unemployment rate dropped to 7.2 percent in February from 7.5 percent in January. The rate remains down from this time last year when it was 8.6 percent.

Klamath County added 80 jobs in February, slightly slower job growth than typically expected this time of year.

Nonfarm payroll employment was down by 230 jobs (-1.1%) from last February. Job losses were fairly widespread. Private educational and health services was the only industry to post job growth from last year,

adding 100 jobs. The largest declines were seen in retail trade (-60 jobs).

Lake County: The seasonally adjusted unemployment rate dipped to 7.1 percent in February, down slightly from the January rate of 7.4 percent. The unemployment rate was down from last February when it was 8.6 percent.

Employment levels in Lake County were up by a modest 20 jobs in February. Typically, the local economy experiences no change to its employment situation this time of year.

There was essentially no improvement to Lake County’s job market over the past year. The private sector posted minor losses, while government added around 30.

Basin Business

Avista Utilities inducted into 100 Best Hall of Fame by Oregon Business Magazine Avista Utilities garnered two recent honors from Oregon Business Magazine.

The company was ranked 18th “Best Company to Work For” in the medium size category (35 to 99 employees), marking the 10th year the company has ranked in the top quartile of all companies surveyed.

Avista was also inducted into the “100 Best Hall of Fame,” recognizing its ranking in the top 100 companies for 10 years.

“We are proud and humbled by this recognition of our company’s performance both in its operations and in the way we value and support our employees,” said Steve Vincent, Avista regional business manager for Oregon.

The Oregon Business Magazine awards are based on two questionnaires — one is completed by the

company and covers topics including compensation, benefits, diversity and other workplace attributes.

The other questionnaire is completed by employees and reflects their perceptions of and attitudes toward the company.

About Avista Utilities Avista Utilities is involved in the production, transmission and distribution of energy.

It provide energy services and electricity to 375,000 customers and natural gas to 335,000 customers in a service territory that covers 30,000 square miles in eastern Washington, northern Idaho and parts of southern and eastern Oregon, with a population of 1.6 million.

Avista Utilities is an operating division of Avista Corp. (NYSE: AVA). For more information, visit www.avistautilities.com.

New import auto and repair service shop opens downtown A new service shop opened in downtown on Esplanade Avenue in March.

This one-mechanic shop is owned and operated by Sean Fleener under the name Sean’s Downtown Import Auto/Equipment Repair.

It is located on the north end of Esplanade at 1501 in a 1920s former service station that has been modernized and includes a gallery of related patents and VW-manufactured vehicles.

Fleener has more than 30 years’ experience in diagnostic services and repair of domestic and import cars and trucks while working for other mechanic shops and construction equipment companies. He is specializing Volkswagen, Audi, Mercedes, Mini Coopers and other imports and uses full computer and control module diagnostic capabilities. He does work on domestic trucks with Duramax and Powerstroke transmissions.

He repairs construction equipment including bobcats, excavators, skid steers and other. His repair capabilities extend into all small-engine equipment such as lawn mowers, weed-eaters, chainsaws and wood splitters.

He has full welding and cutting equipment for any metal fabrication and repair.

His work ethic is one customer, fully focused, with complete explanation of all options and long lasting quality.

For more information, contact Fleener at 541-851-1549

Do you have some business news you want to relay?

Contact the Klamath County Chamber of Commerce at 541-884-5193 or the Herald and News at 541-8854437.

Thursday, March 24, 2016, Herald and News

7

Holding investments for long-term tax breaks As we get closer to the April 15 tax-filing deadline, you may be wondering about how your actions can affect the amount of taxes you pay.

Of course, you don’t have total command of some key tax-related components, such as your earned income.

But one area in which you do have a degree of control is your investment-related taxes. And since 2014 was a decent year for the financial markets, you may have some gains.

If you decide to sell some of your investments to “lock in” those gains, what would be the tax consequences?

Essentially, the answer depends on two variables: your tax bracket and how long you’ve held the investments.

You can get dinged Our tax code rewards those investors who hold their investments for longer than one year. Consequently, short-term capital gains — earned on investments held for less than one year before being sold for a profit — are taxed at an individual’s ordinary income tax rate, which for 2014 can be as high as 39.6 percent.

However, long-term capital gains, earned on investments held one year or longer, are taxed at just 15 percent for most taxpayers and 20 percent for those in the 39.6 percent bracket. (At this tax bracket, a 3.8 percent Medicare contribution tax may also apply to long-term gains, so the top capital gains rate would be 23.8 percent) You’ll need to check with your tax advisor on your specific situation.

In for the long run From a tax standpoint, you may be better off by keeping your profitable investments at least one year before selling them. But are there also other reasons to hold investments for the long term?

In a word, yes. For one thing, if you are constantly buying and selling investments, you won’t just incur taxes — you’ll also rack up commis-

sions and fees that can eat into your investments’ real rate of return.

Also, if you are always buying and selling, you may be doing so for the wrong reasons. You might be chasing after “hot” investments, even though by the time you buy them, they may already be cooling off — and, in any case, they may not even be right for your needs.

Or you might decide you need to “shake things up” in your portfolio because you haven’t liked what you’ve seen on your investment statements for a particular time stretch.

But if the overall market is down, it tends to drag everything down with it — even quality vehicles that still have good prospects.

Buy and hold strategy Rather than chasing after hot stocks or reacting to short-term price movements, you may be better off by following a “buy-and-hold” strategy in which you purchase investments appropriate for your needs and then hold those investments for the long term. Of course, “buy and hold” does not mean “buy and forget.”

You may still need to make transactions, but only if it’s really necessary — such as when an investment is no longer appropriate for your investment goals.

If you want to cut down on your capital gains taxes, holding quality investments for the long term makes sense. As for an investment strategy, a buy-and-hold approach can work well for you — long after tax season has ended.

Submitted by Meredith Hoffman Financial Advisor, Edward Jones 1307 S Alameda Ave, Suite B Klamath Falls, OR, 97603-3601 541.273.2483

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Basin Business

Thursday, March 24, 2016, Herald and News

Paid Advertisement

March 2016 Newsletter for Oregon State Senator Doug Whitsett, District 28 Senator Doug Whitsett

R-Klamath Falls - District 28 I represent the citizens of Senate District 28, which includes Klamath, Lake and Crook, as well as parts of Jackson and Deschutes Counties.

As Senator of one of the largest Senate districts in the state, it is extremely important that my constituents remain in contact with me about the issues and concerns that affect their lives. You and I must work together to protect the common interests of rural Oregonians.

I encourage you to contact my office by either email or telephone so that I can know how to best serve you. I look forward to hearing from you soon.

Best Regards, Senator Doug Whitsett

Capitol Address: 900 Court St. NE, S-311 Salem, OR 97301 Capitol Phone: 503-986-1728 Newsletters: www.leg.state.or.us/whitsett Email Senator Doug Whitsett: sen.dougwhitsett@state.or.us

THE NEW OREGON WAY: CRONY CAPITALISM & MONOPOLY PROTECTION The investor owned utilities (IOUs) such as PacifiCorp and PGE are given state-sanctioned monopolies within their designated service areas. The Oregon Public Utility Commission (Commission) is charged with making certain the more than 1,500,000 IOU Oregon customers are treated fairly by those monopoly-protected corporations.

The Oregon Clean Electricity and Coal Transition Plan (Plan) was championed by PacifiCorp and PGE during the recent Legislative session.

The Plan was passed by Democrat majorities in both chambers and will soon be signed into law by Govern Kate Brown.

The Plan will functionally double Oregon’s Renewable Portfolio Standard (RPS). It will eliminate both the coal-fired generation of electricity in Oregon and the importation of electricity generated by coalfired plants located outside of Oregon.

The Plan passed out of the Oregon Senate on a party-line vote after several hours of strongly worded debate. Only Senator Betsy Johnson (D-Scappoose) joined the Senate Republicans in vocal and persistent opposition to Senate Bill 1574, the bill that codified The Plan.

The scheme was negotiated among PacifiCorp, PGE, environmental advocacy organizations and renewable energy producers, with apparent strong support from the office of Governor Kate Brown. The bargain was made behind closed doors in confidential settings.

Incredibly, the Public Utility Commissioners were barred from participating in the closed-door meetings. All but one organization that advocates for ratepayers also appears to have been excluded from the discussions.

The only exception was the Citizen Utility Board (CUB). CUB was formed in 1984 by initiative petition to advocate for residential ratepayers.

In my experience, CUB has consistently and unabashedly advocated for the production of renewable power. The current chair of the CUB Board of Governors is the Director of Meteorology at Iberdrola Renewables.

Governor Brown expressed her tacit support for the proposal and even “asked” the Commission to refrain from comment until the Plan was fully “pitched” to the public by the utilities. She has also delayed consideration of the reappointment of two of the commissioners until after Legislative Assembly has completed consideration of SB 1574.

Unfortunately, developing new laws in closed negotiations among special interest groups appears to be the “new Oregon Way.” The IOUs claim the proposed changes are affordable, workable and are better for their customers than Initiative Petition 63, that is currently being advanced by many of the same advocacy organizations who participated in the closed-door negotiations.

The IOU representatives failed to mention how lucrative the deal is for their companies. Not surprisingly, those who were not at the table were on the menu including the IOUs’ ratepayers, the consumer owned utilities (COU) that compete with IOUs and the Commission itself.

The Commission held a hearing on the Plan the Friday before the legislative session began. I attended and spoke at that hearing.

The Commission pointed out that the Plan would reverse no less than four previous Commission decisions. They openly questioned the wisdom and appropriateness of the IOUs, who the Commission is charged with regulating, rewriting their own preferred outcome to Commission orders. They further charged that the Plan raises other issues to decide that have already been settled by the Commission through its extensive public process.

The Commission pointed out that the Plan will result in little, if any, overall reduction in GHG emissions. The IOU representatives were not able to refute that assertion. During the Senate hearings, the legislative counsel attorney who drafted the bill testified the Plan would not result in the closure of a single coal-fired generation facility, anywhere.

The only coal-fired plant in Oregon is already scheduled to be closed. Coal-fired plants located in other states, currently supplying electricity to Oregon, will continue to operate into the foreseeable future.

Those plants will not cease to operate, will not stop using coal and will not reduce their GHG emissions.

The scheme is calculated to help meet Oregon greenhouse gas (GHG) reduction accounting goals. Neither regional, nor global, GHG emissions will be measurably reduced. It is worth noting that Oregon currently produces about 0.04 percent of global GHG emissions. That is four ten-thousandths of the total global GHG emission. One part in 2,500!

The complete depopulation of Oregon would not result in a measurable change in global GHG emission.

Advocates of the Plan kept repeating how Oregon must be a leader in GHG emissions. As I pointed out in my Senate floor speech, the first lemming into the sea is also a leader.

The Commission questioned the IOU representatives regarding how the Plan redefines much of the cost of its implementation to be costs that are “prudently incurred.” Those costs can generally be recovered from the company’s ratepayers. The IOUs are also allowed to make about a ten percent profit on most prudently incurred costs.

The Commission declared the plan serves to create significant incentives to build solar and wind powered generation capacity. It then asserted that the text of the bill throws out the requirement for the new construction to be effective and prudent. Its apparent effect is to remove Commission and public oversight, thereby allowing the IOUs to charge their ratepayers and take their designated profit.

Most of the cost of siting and construction of wind and solar generation facilities is currently being borne by taxpayers in the form of refundable tax credits, production tax credits, accelerated depreciation and loan guarantees. Many facilities receive well more than 80 percent of their funding through these tax giveaways. For that reason, most of the cost of complying with Oregon’s RPS is currently being paid by the taxpayer, rather than the IOUs’ customers.

The Commission pointed out that the Plan would allow IOUs to shift much of that cost burden to their ratepayers as prudently incurred costs,

as the existing renewable subsidies are phased out. The IOUs would also be allowed to make their designated profit on much of those enormous new ratepayer funded costs.

The Commissioners questioned the purpose of provisions of the Plan that further enhance the protection of the IOU monopoly status.

They cited two specific sections of the bill that serve to make any encroachment on their monopoly designated territory or customers prohibitively expensive. The sections act as poison pills to prevent any municipal or public utility district, such as those being contemplated in Klamath County, from ever being created.

The plan will essentially prohibit IOU ratepayers from escaping their monopoly protected rates, other than by moving out of their monopoly protected service area. Obviously, Klamath Basin farmland that is irrigated using PacifiCorp provided electricity cannot be moved out of their monopoly protected service district.

Persistent Commission questions regarding the cost of the Plan to IOU customers were generally deflected as a work in progress and as currently being modeled. The IOU representatives appeared reluctant to discuss details of the projected cost increases to their customers. This understandable reluctance also persisted through the legislative hearings.

By most accounts, the “Oregon Clean Electricity and Coal Transition Plan” will cause at least a one and one half percent annual increase in PacifiCorp electricity rates. Those increased costs may be grossly understated, because no comprehensive, independent cost analysis has been performed by the utilities, by the Commission, or by anyone else.

The projected 40 percent rate increase, over the next 25 years, will be in addition to PacifiCorp’s usual Public Utility Commission sanctioned periodic rate increases. PacifiCorp’s rates have already increased by at least 80 percent since the company was acquired by Mid-America Energy Holdings in 2005. That company is a subsidiary of Warren Buffet’s Berkshire Hathaway.

The Commissioners, one and a half million Oregon IOU customers and many members of the Legislative Assembly would have liked to seen a comprehensive cost analysis prior to the votes enacting the Plan. That did not happen!

This is not the Oregon Way. This is crony corporatism and monopoly protection in its most blatant form.

Please remember—if we do not stand up for rural Oregon, no one will.

Best regards, Doug Follow the link below to subscribe to an electronic version of my weekly legislative newsletter updates: https://public.govdelivery.com/accounts/ ORLEG/subscriber/new?topic_id=ORLEG_30.