Oregon Legislative Counsel Reaffirms Legislatures Role In Compact Process

A recent opinion issued by the Legislative Counsel in Oregon reaffirms the role the state’s legislature must play in the interstate compact adoption process.  Specifically at issue is Section 4 of Oregon HB 2679, which allows the Director of the Department of Consumer Protection and Business Services to enter into an interstate agreement to allocate state surplus line premium taxes without first seeking legislative approval.  In the opinion, the Legislative Counsel argues that the legislation as drafted represents an unconstitutional delegation of legislative authority.  

Currently Oregon is a member of 31 interstate compacts.  Of those 31, only one agreement (The Interstate Compact for the Placement of Children – ORS 417.095) has been adopted by the state without legislative approval.  In contrast, the Legislative Assembly has adopted 30 interstate compacts as part of state law.  Given that history, Legislative Counsel contends that it has been near “universal policy” for the Oregon Legislature to be involved in the consideration and ratification of any interstate compact the state joins. 

While this opinion specifically pertains to Oregon’s ability to enter into a surplus lines tax allocation interstate agreement, it speaks much more broadly to the role a state legislature must play in the adoption of an interstate compact.  CSG’s National Center for Interstate Compacts has always contended that a compact must be passed legislatively before being sent to the Governor’s desk for signature and becoming law.  Oregon’s long and successful history with interstate compacts reaffirms that contention and once again speaks to the need for legislative involvement in the compact process.