The debate surrounding federal stimulus money is not limited to Congress. The Oregon legislature is also grappling with a controversial house bill that has Democrats and Republicans divided.
House Bill 2784 would require four banks in Oregon that accepted stimulus money as part of the federal Troubled Asset Relief Program to report how they used the money they received. The bill would also require the banks to appear before House and Senate committees to discuss their lending choices during the legislative interim.
“This bill asks a very simple question,” Rep. Chip Shields (D-Portland) said. “Do we have a right and responsibility to find out where our tax dollars went? I think the answer is yes.”
With the exception of two Democrats and two Republicans, the vote was divided along party lines, with Democrats predominately in favor, and Republicans opposing.
House Majority Leader Mary Nolan said she was frustrated by the lack of bipartisanship she observed in the vote.
“Whenever we ask for true accountability, Republican representatives’ response is to distract Oregonians,” she said. “It is clear they simply prefer the status quo.”
Michael Cox, communications director for the House majority office, said accountability and transparency should be requirements for businesses that receive federal funding. However, Rep. George Gilman (R-Medford) said in an e-mail that the bill would be repetitive because the financial institutions already are required to report where they spend the funding from TARP to another federal agency.
“The Federal Troubled Asset Relief program funding has a significant reporting requirement already, and this legislation would become an unnecessary duplication,” he said. “I have letters from several small banks in Oregon that indicate it would be an additional burden to them, and that is why I voted no.”
President and CEO of the Oregon Bankers Association Linda Navarro agrees that the bill is repetitive and explained that her aversion to it has nothing to do with avoiding transparency.
“It lacks substance,” she said. “It doesn’t add any transparency. If the legislature is interested in investigating banks, they should look at all state-chartered banks, not just the four that took money from the Capital Purchase Program for Healthy Banks.”
Navarro said that Umpqua Bank, Capital Pacific Bank, PremierWest Bank and Willamette Valley Bank did not take the money because they were financially troubled, but were encouraged to take the money to stimulate credit in the state.
“The bill is a poke to the banks that took the money in an attempt to reach out and build up Oregon’s economy,” she said.
Despite the controversy surrounding the bill, it was passed Wednesday in the House and moved into the Senate.
“There are not necessarily any suspicions,” Cox said. “The majority of Democrats are just trying to do everything they can to keep banks accountable to taxpayers.”
[email protected]