The latest quarterly revenue forecast drew a sigh of relief from lawmakers who won't face the prospect of immediate spending cuts. But the accompanying economic forecast confirmed what people feel — Oregon's economic recovery is stuck in low gear.
If nothing else, the forecast served as the opening act of the 2013 legislative session.
New House Republican Leader Mike McLane seized the moment to underscore that 160,000 Oregonians are out of work and may have slim prospects if the state economy continues to limp toward recovery. "Without stronger private-sector job growth," he said, "the next legislature will have difficulty funding education and other services at the levels Democrats promised to voters in the recent election."
"As 2012 winds down," said State Economist Mike McMullen, "Oregon's economic expansion persists, but remains stuck in low gear. Growth continues to come in fits and starts — a strong quarter or two followed by a weak quarter or two, with the underlying trend remaining slow and steady."
The forecast, which Senate President Peter Courtney said shows "signs are positive," means lawmakers won't have to break out their budget axes. But the weak recovery is certain to fuel a more intense debate in the 2013 legislative session about stimulating the economy and restraining spending.
A focal point of that debate will be changes that Governor Kitzhaber seems prepared to advance to the Public Employees Retirement System (PERS), which is projected to soak up a sizable percentage of tax revenue growth in the next biennium.