Oregon Legislators Hear State Economic Report, Explore Policy Proposals as 2014 Session Nears

The Oregon Legislature’s interim legislative committees met in Salem in November to get updates on bills passed in 2013, check up on state agencies and explore policy proposals for the 2014 session that starts in February.

Lawmakers also heard from State Economist Mark McMullen, whose Oregon Economic and Revenue Forecast for the third quarter of 2013 shows continued slow-and-steady growth in jobs, household-income levels and tax revenues – and not just in the Portland metro area.

Oregon’s economic recovery is spreading, McMullen said, and some parts of the state that had been relatively stagnant are now beginning to see rapid growth. Towns like Bend and Medford were among the hardest hit during the recession, but McMullen said both are now beginning to see marked improvement in their local economies.

Lawmakers took no official action in November, but they did discuss a variety of issues, including liquor regulation, health care and electronic cigarettes. The House Consumer Protection Committee also considered the issue of mechanic’s liens on automobiles, hearing testimony from the Northwest Credit Union Association and representatives from OnPoint Community Credit Union.

Pam Leavitt, the Association’s policy adviser for legislative affairs in Oregon, says credit unions are concerned that mechanic’s liens placed on vehicles by unscrupulous entities could negatively impact not only consumers and credit union members, but also the financial institutions that make auto loans.

Under Oregon law, mechanics who work on an automobile may enforce a lien against that vehicle if they are not paid for their work. To do so, the law requires that they obtain authorization to complete the work, and that they notify any existing owners and lienholders of their intention to file a lien. If these steps are taken, they can place a lien on the vehicle, stripping others with interests in the vehicle — including their customer and any lenders — of their title rights.

The Department of Motor Vehicles processes mechanic’s liens without requiring mechanics to demonstrate that they have met the legal requirements. If the process is followed by a reputable mechanic and works as intended, the mechanic is paid for his work and lienholders resume their rightful title to the auto. But financial institutions say unscrupulous mechanics have placed liens for exorbitant amounts — inflated by fees for storage and other unsupported items — gained possession of vehicles and then disposed of them in whole or for parts.

Rightful owners of the vehicles — Oregon consumers and auto lenders — are left holding the bag, Leavitt says. They can sue to regain title to the vehicle, but that requires posting a bond for twice the amount of the mechanic’s lien and incurring approximately $5,000 in legal costs that are not reimbursed by the defendant, even if the plaintiff wins the suit. That financial burden, along with the time and knowledge needed to build a case, usually make such lawsuits impractical.

After hearing from OnPoint’s Veronica Ervin and Steven Epling, committee Chair Paul Holvey (D-Eugene) said he would review the issue for a possible legislative fix during the February session.

Legislative committees meet quarterly when the Oregon Legislature isn’t in session to keep track of issues facing the state. The next regular session is scheduled to begin in February, with additional committee meetings planned in January.


Questions? Contact Gary Stein: 503.350.2216, gstein@nwcua.org.

Posted in Advocacy News.