Oregon Budget Proposal: Program Cuts, No New Taxes

The chief budget-writers for the Oregon Legislature have released a spending proposal that includes cuts to state programs.

The proposal issued Thursday outlines how lawmakers might bridge an expected budget gap.

Revenues continue to grow in Oregon, but the cost of providing services is growing faster, adding up to a $1.8 billion shortfall for the two-year budget cycle that starts in July, according to the co-chairs of the Legislature's budget-writing committee.

The proposal would mean cuts to state-funded programs like education, health care and public safety. Democratic Rep. Nancy Nathanson, who helped craft the plan, said those cuts probably won't sit well with Oregonians.

"I believe we'll start to hear from them once we start to have our public hearings that this is not adequate. It's moving backward," said Nathanson.

She and her senate colleague Richard Devlin drew up their plan without proposing any new revenue sources. They said those conversations are ongoing and a bipartisan agreement on tax increases is far from a sure thing.

Republicans, who serve in the minority in both chambers, offered some praise for the proposal. Senate GOP leader Ted Ferrioli called it a "budget based in reality."

Republicans have been cool to the idea of raising revenue to fill the budget gap.

"The only way Oregon will get through the current budget crunch is by setting better spending priorities and demonstrating budget discipline," said Ferrioli.

The Ways & Means co-chairs said their budget proposal would fund K-12 education at roughly $200 million less than the cost to continue services at existing levels.

Some education advocacy groups say the gap is even larger than that.

"We recognize that the co-chairs are in a tough spot," said Oregon School Boards Association director Jim Green. "But the budget proposals we are seeing signals a terrible cycle of future cuts for our schools."

The legislative proposal wouldn't mean as many cuts to higher education as a spending plan released by Gov. Kate Brown last month. But the co-chairs said it could still lead to higher tuition and staff reductions.

Another difference between the governor's budget proposal and the legislative budget framework is that the lawmakers' version does not recommend the closure of a new psychiatric hospital in Junction City.

Instead, the co-chairs would save money by reducing the number of patients being served in both Junction City and the state's main mental hospital in Salem. Like the governor's budget, the co-chairs' proposal does recommend shuttering an Oregon Youth Authority facility near Astoria.

Lawmakers convene Feb. 1 for a five-month session. Most budget decisions won't be finalized until after two more revenue forecasts — in February and May — give lawmakers a clearer picture of the revenue that will be on the table.

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