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Special Session Finishes As Budget Showdown Looms

Gov. Kate Brown -- and lawmakers -- hope that federal authorities will give Oregon money to help plug the budget hole before another special session later this summer.
House lawmakers meet during the special session on Thursday, June 25, 2020. | BEN BOTKIN/THE LUND REPORT
June 29, 2020

Oregon lawmakers wound up the three-day special session on Friday but now they face the daunting task of balancing a state budget in another session later this summer. 

Gov. Kate Brown and the legislative leadership want to wait a few weeks before tackling the budget to see what, if any, federal aid Congress may send Oregon’s way before lawmakers start slashing spending. Brown hopes to avoid a bloodbath that would gut agencies as the public increasingly turns to the government for help for everything from medical care to food stamps to housing assistance during the pandemic. 

“If we don’t see action by the end of July, then I will be expecting to call the Legislature in very quickly to look at budget reductions and plan for the next biennium,” Brown told reporters Saturday.

Earlier this year, Brown ordered agencies to undergo an exercise that demonstrates the severity of the state’s budget situation: She asked agencies to suggest 17% in budget cuts for the rest of the two-year budget cycle, which ends June 30, 2021.  Those scenarios are just a starting point when lawmakers get down to business. 

At the Oregon Health Authority, a 17% cut would take more than $370 million out of the agency. The authority’s proposal would trim 173 beds from Oregon State Hospital, which serves people with mental health needs. Medicaid, a $6 billion-a-year program, would lose $64 million, or $233 million when factoring in matching federal money. 

The revenue projections are grim. Oregon faces a $2.7 billion revenue shortfall for the upcoming fiscal year, a reflection of the state’s unemployment during a pandemic that has forced restaurants, bars and hair salons to close their doors for months or drastically curtail their services. 

The recovery will not unfold quickly. The state’s economic forecasters project a $10.5 billion revenue shortfall for the next five years. 

Brown knows a bailout from Congress that eliminates the entire budget gap is unlikely. 

“Obviously, it would be my hope that they would provide enough federal dollars to fill that entire hole,” Brown said. 

But, she added: “I am realistic enough to know that’s not likely to be the case.”

Brown has outlined about $150 million in proposed cuts for state agencies, but without federal help more trims will become necessary. 

“We’re continuing to hold vacancies open and frankly we’re doing everything we can to squeeze every little bit of toothpaste out of the tube to address the short-term budget crisis,” Brown said.

Congress isn’t the only lifeline. The state has about $1.5 billion in reserve accounts, another source that could offset deeper cuts. 

Said House Speaker Tina Kotek, D-Portland: “Now we can refocus our energy on rebalancing the budget and protecting working people.”

To be sure, lawmakers were busy during the special session, with a focus on police reforms sparked by the death of George Floyd and COVID-19 relief for Oregonians. Lawmakers extended the governor’s moratorium on evictions through Sept. 30 and gave tenants six months to catch up on back rent.

They also limited police use of tear gas and chokeholds and passed a bill requiring a database of police misconduct.

Lawmakers didn’t avoid health care entirely. They passed a bill that requires health care providers to collect data on race, ethnicity and preferred written and spoken languages while treating patients for COVID-19 and report the information to the Oregon Health Authority. 

The Legislature also approved a bill that establishes more rights for people with disabilities in hospitals. The measure, Senate Bill 1606, guarantees that patients can see family and have a caretaker with them for special needs\. 

Advocates for people with disabilities lobbied for the legislation, saying the COVID-19 pandemic exacerbated discrimination against people with disabilities. In some cases, patients with intellectual or developmental disabilities faced obstacles in receiving treatment or providers urged them to have end-of-life directives that denied ventilators or other life supports.

The pandemic was front and center during the session. The capitol building was closed off to the public, except for the media. Arrows taped along hallways directed the flow of foot traffic to ensure people maintained 6-feet of physical distance.  

The capitol was much more quiet without the milling about of lobbyists, schoolchildren on tours and sightseers. Committees heard testimony from the public -- but virtually through video conferencing.

Legislative leaders even mulled the prospect of an entirely virtual special session, but scrapped the idea amid concerns that new laws could not withstand a legal challenge. 

Lawmakers passed about two dozen bills in three days. During the regular session earlier this year, lawmakers passed only three bills due to a Republican-led walkout of legislators that kept both chambers from having a quorum and passing bills. That 32-day session ended March 5, three days shy of the deadline to adjourn.  The Senate had a similar walkout in the 2019 session.

Sen. Peter Courtney, president of the Senate, was relieved that lawmakers fared better during the special session. He had feared the Legislature could become obsolete if it didn’t do its job.

“From a political science standpoint, I think this moment had to come for the Legislature or she eventually would disappear,” Courtney, D-Salem, said.

Republicans, however, called the special session a failure because lawmakers didn’t address the budget up front.

“This session has been a huge disappointment because we did not get the budget done, and Oregonians were locked out of the process,” Senate Republican leader Fred Girod, R-Stayton, said in a statement. “This isn’t sine die because we will be back for another expensive special session that will pander to Democrat special interests.”

You can reach Ben Botkin at [email protected] or via Twitter @BenBotkin1.