Governor Kate Brown released her 2019-2021 budget recommendations that roll out ideas to shore up state health care funding, continue to invest in affordable housing and pay for initiatives she announced in her re-election campaign.
Proposed budgets are also notable for what they don’t include. Brown’s $23.6 billion budget proposal omits any mention of Public Employees Retirement System (PERS) cost-cutting or investing to restart bi-state conversations about an I-5 Columbia River Bridge replacement.
Her proposed budget did contain a $2 billion revenue challenge to legislators to bolster Oregon’s public education system. The challenge coincided with the rollout of the Coalition for the Common Good, consisting of Oregon public employee unions, a group of long-term care providers and Nike, in support of a major tax package.
“We want to bring a sole focus into revenue reform,” said James Carlson, president of the Oregon Health Care Association. “The reality is we can’t afford to waste another five years chasing a deal that may or may not happen” on cutting government costs.
Major business groups are positioned to resist a major tax overhaul without steps to reduce the $22 million unfunded PERS liability, which poses a drain on local government and school district budgets.
The $2 billion in new revenue would go to extend the school year, decrease class sizes, expand access to preschool and decrease college tuition at public universities. Brown faced sharp criticism in her re-election campaign for Oregon’s low high school graduation rate and failure to provide all of the funding voters authorized to expand career and technical education statewide.
Brown’s budget is heavy on aspiration and revenue projections. It also is very readable, has a reasonable amount of detail and is backed up by economic and revenue analysis. For example, it shows that $19 billion in revenue comes from Oregon personal income taxes, which represents 80 percent of the budget. Corporate income taxes and lottery proceeds contribute 4 and 5 percent, respectively. Roughly 50 percent of Brown’s proposed spending would go to education and 27 percent to human services.
Even though state lawmakers will have around $1 billion more in revenue than the previous biennium, Brown included tax increases in her budget, much of it to plug a funding hole for Medicaid. She proposed raising tobacco taxes by $2 and expanding taxes or assessments on hospitals, insurers and some employers.
In her budget, Brown proposes to shut down the Oregon Department of Energy and allow the state’s Chief Education Office to end. She asks for creation of an Oregon Climate Authority that would administer a “well-designed, market-based program to achieve our state climate emissions reduction goals at the least possible cost, while protecting our manufacturing industry and mitigating impacts on low-income and rural communities, communities of color, and Tribes.”
Brown devotes substantial funding to her Children’s Agenda, including $285.8 million to provide preschool for an additional 10,000 children, $20 million for housing stability for homeless families, $13.8 million to integrate disorder treatment and behavioral health programs for families and $10 to increase “quality, affordable” child care. Brown wants to ensure 100 percent of Oregon children have health care access and proposes $47.1 million for a comprehensive child welfare system “based on positive human development” and that reduces the need for foster care.
Another campaign promise that showed up on Brown’s budget is incorporating standards from the federal Clean Air and Clean Water acts into state law. She also wants to fund an effort to eliminate a backlog in pending air quality permits.
Brown recommended expanding Oregon’s automatic voter registration system by including other public interactions with state agencies, such as applying for a hunting license, as triggers and sending voters ballots with return envelopes with pre-paid postage.
After a gubernatorial election that broke state spending records and involved independent expenditures funded with dark money contributions, Brown committed to work on campaign finance reform.
The budget proposal sets aside money for earthquake preparedness, firearm safety, a university program dealing with threat assessment and immigrant defense. Some $5 million is earmarked for funding rural broadband infrastructure and $10 million for remediation of rural brownfields so they can be redeveloped.
Brown titled her budget proposal, “Turning Point: An Agenda for Oregon’s Future.” Here is the opening paragraph of the budget document:
“Oregon is at a turning point. Hundreds of thousands of people have moved here in the past 20 years, and a million more are on their way. We’ve done some good things over the years, but our state is changing, and changing rapidly. With the aging of Oregon’s baby boomer generation, and the impacts of recent dramatic federal tax changes and burgeoning federal deficits exacerbating these changes, one thing is clear: we can no longer do things the way we have in the past. We must grow up as a state, and we need to decide – together – what we want to be over the next 20 years. The challenges of affordability, of educating our kids, of mitigating the effects of climate change, and of maintaining a strong democracy will not get better unless we change our approach.”
She says Oregon must renew faith in democracy, spend money wisely, address affordability, prepare for the future and “finally fix our underfunded education system.”