State economist Mark McMullen reported to the legislature today total general fund and lottery fund projections for the 2011-13 biennium are down about $200 million from the close-of-session projections, which observers say is a small enough number legislators may not need to take emergency action to adjust the budget.
The personal income tax projection is down by $158.4 million (1.3 percent) and the projections for the corporate income tax projection is down by $18.7 million (2.1 percent).
Legislators will get two more quarterly revenue forecasts - one in December and another in February - before the end of the short legislative session on March 6. If the downward trend in revenue projections continues, legislators may make and adjustment to the budget in February.
Economists in the Oregon Office of Economic Analysis blamed the slowdown in employment for the negative adjustment in the revenue forecast. Second quarter job growth is estimated at 0.7 percent, and although it's positive growth, McMullen said, it's too slow to help economic recovery. Job increases were reported in manufacturing, retail traide, health services, and leisure and hospitality.
McMullen also said Oregon's recovery could be hindered by consumer pessimism, which already has had a palpable effect on the East Coast economies. If the same pessimism infects West Coast consumers, McMullen said, the outlook could get bleaker.
The state economist also released the almost-final revenue numbers for the 2009-11 biennium and said he does not expect either the corporate or personal kicker refund.
McMullen made his first appearance in front of the legislature as the Interim State Economist, after Tom Potiowsky stepped down last month to return to teaching at Portland State University.