Oregon state relief fund hit by lawsuit from logging company citing racial discrimination


A Pacific Northwest logging company is suing the Oregon state government over a relief program devoted to Black Oregonians on the grounds its mission is unconstitutional.

The lawsuit was filed on Thursday in U.S. District Court by Great Northern Resources, which claims the COVID-19 pandemic has already cost it $100,000 in sales and could cost up to $200,000 by the end of the year.

According to court documents, the company said it was twice denied a $10,000 grant from the U.S. Small Business Administration’s Economic Injury Disaster Loan Program and its cash reserves have since run dry. It is still awaiting on an emergency grant from the Greater Eastern Oregon Development Corporation it reapplied for on October 19, court documents show.

The company is suing the state over what it claims is unlawful discrimination by other state relief programs, namely the Oregon Cares Fund.

The fund was created this summer and devotes a share of the state’s $150 billion in federal CARES Act aid to financially distressed Black Oregonians, businesses, and nonprofits.

The $62 million fund is administered by The Contingent nonprofit in partnership with The Black United Fund.

Great Northern’s 14-page lawsuit names Katy Coba, the state's chief operating officer and director of Oregon Department of Administrative Services, and The Contingent as defendants.

“Because Oregon did not link the grant program to specific, ‘identified discrimination,' Defendants cannot establish that the program furthers a compelling state interest – and it is therefore ‘almost impossible' to conduct a narrow-tailoring inquiry,” the lawsuit states. “The Legislature’s superficial analysis confirms that Defendants cannot meet their burden of showing that the use of race to distribute grants is narrowly tailored.”

The lawsuit seeks an injunction banning the defendants from using race as an “essential factor” in distributing relief as well as reimbursement for legal fees.

It argues further in the lawsuit that the Oregon Cares Fund violate the Fourth and 14th Amendments as well as the Civil Rights Act of 1964. According to the lawsuit, Great Northern claims that the Oregon Cares Fund stands to discriminate against its owners on the basis of their race. They are not Black, according to court documents.

A number of Oregon lawmakers, from Oregon House Speaker Tina Kotek, D-Portland, to Gov. Kate Brown, pushed for the fund’s creation on the grounds that it could correct historical inequities experienced by many Black Oregonians.

A 2018 report from the Oregon Health Authority found that Black Oregonians made up 20% of those living below the federal poverty line despite making up 2% of the state’s population, according to the U.S. Census Bureau.

The OHA has further reported that 9% of those hospitalized with COVID-19 were identified as non-hispanic white while another 8% were identified as Black.

Other Oregonian leaders who support of the fund point back to the state’s Exclusion Law of 1844, which banned Black people from living in Oregon and subjected Black settlers to “not less than twenty nor more than thirty-nine stripes” for every six months they remained in the state.

The lawsuit has received criticism from a range of Oregon activist and nonprofit groups.

Oregon’s Black Resilience Fund, which largely raises money for local Black communities and businesses, condemned the lawsuit’s assertions.

“This challenge seeks to stamp out any legislative effort to uplift Black, Indigenous, & other People of Color,” the organization tweeted. “In a state that at once made it unlawful for Black people to settle here, any legislative effort to remove barriers for Black people is what's unprecedented.”

A hearing for the case has not been scheduled.

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