The retooling of AOI
Associated Oregon Industries, the state’s oldest and
largest business lobby, overhauls its mission, installs a new
leader and sets about shining its lackluster image.
By Christina
Williams
Richard Butrick’s retirement reception was a friendly,
buffet-table, open-bar affair at the Salem Convention Center.
Backs were slapped, speeches were made and jokes were cracked.
At the evening’s wane, Butrick, president of Associated
Oregon Industries since 1986, asked the well-dressed group to
turn their allegiance over to his successor: a tall,
gray-haired gentleman keeping a low profile in the back of the
room.
For Salem insiders, that introduction marked the end of an era.
For two decades Butrick, a former parole officer, was the man
out front for the state’s oldest and largest business
lobby. During that 20 years AOI built up its muscle as a player
in the capitol, raising more money for its political action
committee, adding thousands of companies to its membership
rolls and taking staunch positions against bills the
association deemed bad for business.
Butrick, at 69, wasn’t forced into retirement. But his
exit from AOI gives the association an opportunity to bring in
new energy. And the change at the top coincides with a year of
soul searching by a board of directors eager to brush up
AOI’s image, not just among the business folks from the
20,000 companies it counts as members, but also in the minds of
the politically inclined Oregonian.
To carry its message and lead AOI into its next era, the board
hired Jay Clemens, a 59-year-old chamber of commerce veteran
and a self-described collaborator who comes to Oregon from the
Tulsa Metro Chamber in Oklahoma.
AOI CALLS ITSELF A NONPARTISAN business association, but the
label is dismissed as fiction by many Oregonians who look at
the politicians and issues that AOI supports and see a
decidedly Republican bent.
It’s not an image that AOI takes pains to avoid. Take
Butrick’s retirement party for example. Among a list of
corporate sponsors who kicked in money for the goodbye bash was
one conspicuous individual name: Saxton, Ron.
Harvey Mathews, director of AOI’s Political Action
Committee, says the group’s goal is to look at each
political race in a nonpartisan way before deciding to back a
candidate. “We don’t just write checks,” he
says. “We meet with the candidates and analyze the data.
We want to support the best business candidates,
period.”
In the current election cycle, AOI has thrown its weight and
its cash behind eight Republicans, including House Speaker
Karen Minnis, Majority Leader Wayne Scott and four
Democrats.
AOI has also come under fire for its cozy relationship with
state-owned workers’ comp provider SAIF Corp. Last year
SAIF restructured its contract with AOI in response to protests
from some legislators that AOI was the beneficiary of unearned
financial support from SAIF. To mollify critics, SAIF dropped
an annual subsidy — most recently $400,000 — it
paid for AOI to publish its bimonthly Business ViewPoint magazine.
TIME LINE
1895 — AOI is
founded to promote products made in Oregon.
1986 —
Richard Butrick is hired as the association’s
fourth president.
1988 — The
AOI Political Action Committee spends $73,200 during the
1987-88 election cycle.
1991 — AOI
starts offering workers’ compensation services to
SAIF Corp. customers with an aim of signing up as many as
12,500 businesses in the process. 1992 —
Oregon’s Family Leave Law goes into effect,
requiring businesses with 50 or fewer employees to give
12 weeks of unpaid leave to employees who need to care
for sick or injured family members. AOI lobbied against
early versions of the bill, and offered an amendment that
raised the threshold from 25 to 50 workers.
1992 — Joan
Austin of A-dec, a Newberg dental supply manufacturer,
becomes the first (and still only) woman chair of the AOI
board of directors.
1993 —
Northwest Natural cancels its AOI membership in protest
after AOI opposes a sales tax for education.
1996-97 —
Oregon Forest Industries Council, an AOI division, splits
to form its own association. Former AOI chair L.L.
“Stub” Stewart calls for a management review
of AOI.
1998 — AOI
PAC spends $112,000 on the 1997-98 election cycle.
2005 — SAIF
downsizes its contract with AOI to provide workers’
comp services and stops paying a subsidy for AOI’s
Business ViewPoint publication.
August 2006
— AOI board hires Jay Clemens, who takes over in
September following the retirement of Richard Butrick.
PAC raises more than $400,000.
December 2006
— AOI will release its agenda for the 2007
legislative session.
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A deal struck with SAIF in 1991 meant that AOI could sell
workers’ comp packages to its members at attractive
rates. Thousands of members joined AOI to buy the
workers’ comp coverage. Under the current SAIF contract,
AOI still offers the insurance, but no longer receives the
money for the magazine. Another contract under which AOI
provides risk management services for SAIF is likely to expire
this year.
In addition to the SAIF complaints, AOI has been charged with
exerting its considerable influence in the Legislature —
many feel excessively. The group received much of the blame for
killing biofuels legislation during the 2005 session by adding
an extension of the Pollution Control Tax Credit for Oregon
businesses. (Rep Jackie Dingfelder, the Democrat from Portland
who sponsored the original bill along with Rep. Jeff Kropf, a
Republican from Sublimity, calls the PCTC “the sacred cow
of AOI.”) AOI also urged the addition of language that
would prohibit the state from adopting clean car standards such
as the ones passed in California.
“It was the poison pill of the bill,” Dingfelder
says of the AOI-supported additions. “It’s very
unfortunate they chose a package that had bi-partisan
support.”
AOI vice president John Ledger says AOI was one of several
groups backing the final bill and that AOI didn’t request
the anti-clean car language. “It was a good bill,”
Ledger says. “When a good bill dies everyone points
fingers.”
Dingfelder is hopeful that a biofuels package will pass this
session, and she’s already working with AOI on another
bill regarding electronic waste. “That’s just the
way it works in Salem,” Dingfelder says. “They can
be your ally on one issue and your opponent on
another.”
AOI’S FORMIDABLE HISTORY and lobbying muscle makes it a
valuable partner in Salem.
“It’s in every business entity’s interest
for them to be a strong organization,” says Mike
McCallum, president of the Oregon Restaurant Association, who
worked closely with AOI to oppose the energy deregulation bills
in the 2001 and 2003 legislative sessions.
“AOI is the one organization that should be the leader
and has the potential to give everyone else the backbone to
stand up for core business issues,” says J.L. Wilson,
state executive director for National Federation of Independent
Business. “That’s the role they should
assume.”
Wilson says AOI falls short sometimes — “like
everyone does” — and can seem to be spread too
thin, but he calls the group a “worthy
partner.”
Wilson is also president of the Oregon Small Business
Coalition, an affiliation of business lobbyists, which was
formed in 1995 as an alternative to AOI. “But
that’s not how we’ve grown up,” Wilson says.
“We work together on 95% of the same issues.”
The Oregon Business Association was formed in 1999 as another
alternative to AOI and has about 300 members. “There was
a need for a more progressive business voice,” says Tom
Kelly, founding board chairman and president of Portland
builder Neil Kelly. We felt AOI was too partisan.”
Kelly says OBA’s mission is to lobby for big-picture
issues such as education, transportation, access to health care
and a sustainable environment. “We’re trying to
recapture the magical time when business was a real proactive
voice,” Kelly says, referring to the 1970s.
When OBA was formed, AOI was coming out of a contentious
decade that saw some high-profile member defections such as
Northwest Natural and Portland General Electric and a tiff that
led to the Oregon Forest Industries Council splitting off from
AOI to form an independent organization.
Since that time, NW Natural and PGE have both come back into
the fold as members, and this year the OFIC moved its offices
into AOI’s building and enjoys a cordial relationship.
Add to that a cleaner relationship with SAIF and the end of a
20-year Butrick regime and it begins to look like a new day for
AOI.
It’s a fact that wasn’t lost on the
organization’s board of directors, which embarked more
than a year ago — even before the announcement of
Butrick’s retirement — on an overhaul of
AOI’s mission and image.
“IF YOU DON’T DEFINE WHAT YOU’RE FOR, then
other people will do it for you,” says Dan Harmon, a
Hoffman Construction vice president who serves on AOI’s
board of directors. “AOI was defined more by what it is
against than by what it’s for.”
Through a process of surveys and interviews, Harmon and the
board learned that AOI was known as a defender of corporate
interests, but wasn’t seen as a group with any interest
beyond its business membership. “People in the public
lost the connection between business doing well and the general
good for the state,” Harmon says.
Ben Fetherston, a Salem lawyer and new chairman of
AOI’s board of directors, will help steer the
organization over the next year or so toward a long-term policy
agenda that will set goals around Oregon’s trouble spots:
education, health care and fiscal reform.
“A lot of the focus of AOI has been moment to moment and
issue to issue,” Fetherston says. “What I have in
mind is developing and identifying long-term policy objectives
and then identifying the strategy to accomplish the
objectives.”
Prosperity has become AOI’s watchword. And convincing
the average Oregonian that AOI is promoting their individual
prosperity is the association’s goal.
It’s just one of several challenges — in-cluding a
budget that’s been in the red recently — that will
be faced by Clemens, who was selected by the board after an
exhaustive search. Clemens’ fiscal turnaround experience
was attractive and ultimately pushed the Washington native to
the front of the pack. According to those close to the process,
there were Oregonians in the running — some with
considerable clout in Salem — but, in the end, the board
went for the outsider with deep experience.
Clemens says he’s ready for the difficult task of
running a statewide business association in a state as diverse
as Oregon. The one-time president of the Boise Chamber of
Commerce was also eager to return to the Pacific Northwest.
“This is my part of the world,” Clemens says,
seated in Butrick’s old wood-paneled office at
AOI’s headquarters, a vigorous stone’s throw from
the Capitol.
In his first weeks in office, Clemens spent time getting
around his part of the world, meeting with lawmakers and a long
list of AOI constituents, as well as business leaders
representing companies AOI would like to woo as members.
He brushes away the notion that AOI is in trouble, that its
conservative stance has driven away some members, that its
revenue is lagging. “AOI is probably
misunderstood,” Clemens says. “I would tell people
not to underestimate this organization.”
“THE NEXT GENERATION OF AOI” is what Clemens calls
Associated Oregon Industry’s new phase. He will lead the
rebranding effort, replete with a marketing push. And
he’ll be working with the board on getting that long-term
policy agenda — the “prosperity agenda” in
AOI-speak — ready for prime time.
But don’t expect a wholesale change. AOI will still
battle “bad-for-business” bills and take stances
that might not match the opinions of all of its members.
“If you’re going to be a meaningful organization,
you have to take positions on tough issues,” Clemens
says. The trick to not alienating your members, he says, is to
have a process in which everyone gets to have their say.
“It has to be democratic.”
AOI’s partners in Salem are looking toward Clemens to
see what kind of change he can actually deliver. “We look
forward to new leadership,” McCallum says. “AOI can
be stronger. And it will be in Oregon’s best
interest.”
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