An eastern Oregon logging company wants to block Oregon’s new, $62 million coronavirus relief fund for Black Oregonians and businesses from using race to allocate money until the courts resolve its legal challenge.
Great Northern Resources, a small logging company in John Day, filed a motion for a temporary restraining order or preliminary injunction against the Oregon Cares Fund in the U.S. District Court in Portland on Saturday.
The motion comes after the logging company filed litigation over the constitutionality of the fund on Nov. 2. Great Northern Resources said it expects to lose $200,000 this year because of the coronavirus recession and contends that it has a right to compete for coronavirus relief money allocated to businesses.
“The pandemic’s harm to Great Northern should qualify it to compete in any government-aid program for businesses that have been affected by Covid-19,” Saturday’s motion said. “And yet the company is ineligible to receive a grant from the Fund because its owner is not Black. This is unconstitutional. By distributing government benefits on the basis of race, Oregon has violated the Equal Protection Clause” of the U.S. Constitution.
The litigation doesn’t identify Great Northern’s ownership, but public records list its president as Tad Houpt, a lands-rights activist who was active in the events around the occupation of the Malheur National Wildlife Refuge in 2016. Grant County Commissioner Sam Palmer identified himself as Great Northern’s vice president in a filing with the state last year.
Conservative legal strategist Edward Blum says his organization is funding the legal challenge.
The logging company contends in its new motion that the fund will be depleted and that it will be denied the opportunity to compete for relief on an equal footing without emergency injunctive relief.
Federal CARES Act dollars used to seed the fund must be spent by Dec. 30.
As of Sunday, organizers of the Oregon Cares Fund had already approved more than $37 million in payments and paid out more than $25 million to Black Oregonians, Black-owned businesses and Black-led nonprofits.
The lawsuit lists The Contingent, a nonprofit which is administering the fund in partnership with the Black United Fund, and the Oregon Department of Administrative Services as defendants. The department did not immediately respond to a request for comment Sunday.
Fund organizers defended the constitutionality of the fund Sunday, asserting that Black Oregonians are experiencing disproportionate harm from COVID-19 due to systemic disadvantages built into the economic and healthcare systems.
“The Contingent must be allowed to continue this targeted grant program,” said the Oregon Cares Fund in a statement Sunday. “Legal and political processes should not impede delivery or aid to those in need during a pandemic that has caused historic levels of economic harm. While attorneys argue, people suffer. It’s not fair to deny aid to deserving businesses in the middle of a global pandemic.”
The Oregon Legislature’s Emergency Board voted in July to allocate federal CARES Act dollars to seed the fund.
A July 13 opinion by the Legislative Counsel’s Office said that setting aside funds for one race could be considered unconstitutional without strong data and evidence showing “past discrimination in the economic sphere.” The agency said it wasn’t aware of the Legislature compiling that evidence.
Proponents of the fund pointed to a separate legal opinion from firm Schwabe, Williamson & Wyatt that contended that Black Oregonians are both suffering disproportionate economic harms from COVID-19 and receiving disproportionate aid from existing relief efforts.
According to the Oregon Health Authority, Black Oregonians are more than three times as likely as White Oregonians to contract COVID-19, despite making up under 3% of the state’s population.
A study conducted by the National Community Reinvestment Coalition in July found that Black business owners had a harder time securing coronavirus financial relief than white business owners. A separate study from researchers at the University of California, Santa Cruz found that Black-owned businesses were closing twice as fast as White-owned businesses during the pandemic.
