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June 2nd, 2010 HENRY STERN | News Stories
 

State Of Disaster

Trying to get beyond the definition of insanity and figuring out what to do differently in Oregon’s bleeding budget.

     
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IMAGE: Jon Sperry

Last week’s grim budget news that the state of Oregon has sprung another $577 million budget leak prompted us to post on wweek.com with a couple of quick thoughts.

The first was to point out an article that same day in The New York Times about some of the dramatic changes—like reducing the number of counties—other budget-strapped states have considered. (It’s worth noting that former Gov. Vic Atiyeh proposed three decades ago that we consolidate metro-area counties into a “Willamette County” in order to eliminate redundancies and save tax dollars.)

The second was that our financial mess may help Oregonians trying to get marijuana legalization on the November ballot. Passage of such a measure would mean additional tax revenue—proponents estimate up to $100 million a year—at a time when the state is turning over the couch cushions looking for change.

At the moment, Gov. Ted Kulongoski is proposing 9 percent cuts across the board and Republican lawmakers want a special session to be a bit more surgical. In our post (wweek.com/budget_news), we asked our Web readers for advice on how to balance the smaller budget. Here’s a small sample of what readers told us (with edits for space considerations):

Eric says:
May 25, 2010 at 4:18 pm  

Can we “unplan” the Columbia River Crossing project and get some of that $100 million refunded to us? Or maybe cancel (for now) the Milwaukie MAX line to recover the $250 million in pledged lottery funds? Speaking of the lottery, now there’s a golden goose to squeeze some more. Can they revoke the contract with bars and taverns they signed in October to cut their commissions? If not, how about creating some exciting new Lottery games in the months ahead? I can’t think of a better way to fund needed basic services than to take more money from the poor, the financially non-savvy, and gambling addicts.

3rd solution says:
May 25, 2010 at 11:48 pm

Let’s implement a 3 1/2 to 4 1/2 percent sales tax on luxury items: Automobile purchases over $25K, boat purchases over $15K, jewelry, wine, watches, bottled water, candy, aircraft. This amount is not so significant that people would stop purchasing the smaller items, but we’d earn a good deal of money from people purchasing larger items because their personal incomes happen to be growing, and [they’re] in a position to buy special luxury goods.

Skip Loder says:
May 26, 2010 at 9:47 am  

9% across the board cuts so everyone feels the pinch. Only then can serious discussions start about repealing the kicker since budget forecasts are always off and we need to save for a rainy day. Follow this with PERS reform, which is a must, and get the unions involved since state wages and benefits are too high and unsustainable. “Enhancing revenue” is a tough one, since Oregonians hate to pay for anything. Finally, we all must realize that our standard of living is going to be permanently lower than our past expectations. Sorry, just keepin’ it real!

harley leiber says: May 26, 2010 at 10:55 am
PERS reform? You’re drilling a dry well.… The 2003 changes have been litigated and resolved. There is nothing left to change, really, other than telling public employees to save their own money. You are not going to get anyone to reduce benefits that are already being paid…. The people receiving benefits were subject to the rules in force at the time. It was a valid contract...end of discussion.

Eric says:
May 26, 2010 at 12:20 pm

Contracts are abrogated all the time. Laws are rewritten. Court precedents are overturned. Responsibilities are discharged in bankruptcy court. The accepted wisdom is that PERS is ironclad and inviolable. The accepted wisdom also once held that house prices only go up. We know how that worked out. Nothing is guaranteed.

harley leiber says:
May 26, 2010 at 2:28 pm  Eric:
I feel your pain, buddy, but the issue is settled law. Move on.

Geoff Kleinman says: May 26, 2010 at 8:21 pm
The third thing is the corporate kicker check. Yup, that’s right, even with record budget deficit the corporate tax estimates were too low and so corps in Oregon may get REBATE checks. Can our system be any more broken?

392812 says: May 27, 2010 at 10:46 am
My proposals to solve Oregon’s budget problems:

1) Abolish the kicker. Seriously, banning a 2%+ surplus makes stability impossible.
2) Establish a reserve/emergency/reserve fund.
3) Implement a sales tax.
4) Legalize marijuana.
5) Legalize same-sex marriage.

 
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