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Monday, May 31, 2010

There's a Hole in the Budget - Again

Posted By on Mon, May 31, 2010 at 4:36 PM

Gov. Ted Kulongoski gave Oregonians an ugly surprise last week: There’s an unexpected $570 million hole in the state’s budget for the next biennium.

The hole was discovered when the state processed the 2009 income tax returns and discovered that incoming revenue was a lot less than anticipated. Exercising his “allotment authority” under state law, the governor announced he would order a 9% across-the-board spending cut.

Writing on the Blue Oregon blog, state Rep. Michael Dembrow (D-Portland) describes the “devastating” effects of the cut on state programs and institutions, including education ($252 million, mostly in K-12), Human Services ($154 million), the state university system ($30 million) and community colleges ($20 million).

Instead of cutting across the board, Republicans want a special session of the legislature to decide what should get cut and by how much. Democrats like Dembrow reject that idea: “I see that process as leading to further uncertainty and unproductive political posturing,” he writes.

I have to go along with the Republicans on this one. True, the legislators would engage in “political posturing” – when don’t they? – and the Republicans would take every opportunity to rub the Democrats’ noses in the state’s current economic and fiscal mess.

But the cuts, especially to our already battered and bloody education system, are so damaging that I think the lawmakers need to shoulder their responsibilities and make the painful choices. I find myself agreeing with Bend Republican State Sen. Chris Telfer, who’s quoted on the Oregon Catalyst site as saying the cuts “should happen carefully and precisely reflecting the priorities of Oregonians, protecting the most vulnerable and investments in K-12 classrooms. That means the legislature must come into session and do what it was elected to do.”

When the current crisis is past, the legislators and the governor (whoever he may turn out to be) need to get real about providing a stable funding source for our schools.

Which makes me think of the Oregon Department of Transportation.

Whether the economy is good or bad, under Democratic administrations or Republicans, ODOT never seems to suffer. It always seems to have plenty of money to tear pavement up and put it down again.

Why? Because ODOT has a dedicated source of funding – the state motor fuels tax, currently among the highest in the nation at 43.7 cents a gallon on gasoline. The motor fuels tax generated close to a billion dollars for ODOT in the current biennium. All that money must be spent on state transportation projects; the politicians can’t fiddle with it or raid it for other purposes.

Could a similar source of dedicated funding be created for education? Something small and relatively painless? How about a nickel tax on every book, magazine and newspaper sold in the state?

I haven’t penciled out how much revenue that might produce; I’m just throwing it out there as an idea. But if we don’t do something about education funding, Oregon is going to become known as the state with the most beautiful roads and the most illiterate drivers.

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