Tax increase comes up for vote

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“Nobody cried over the people I laid off,” he said. “Why shouldn’t the public sector share in the cutbacks? When the private sector has to cut, the public sector needs to cut.”

Oregon’s economic woes are capturing national attention as a recent survey released by the Pew Center on the states ranked the beaver state’s budget gap as ninth in America, way below California, which is No.1, and significantly below Rhode Island, which was No. 8.

The 2009 to 2011 biennium state budget was cobbled together with about $1 billion in stimulus money and about $733 million in personal income and corporate tax increases which voters will decide on in January.

But, whatever the outcome of that vote, unless the economy picks up and state revenues follow, the shoe will drop in the next biennium when the federal stimulus money goes away.

But the ending of the federal money will not be the only stark issue.

“The rainy day funds are gone,” Bentz said.

There will also be a boost in the costs of state health care and other automatic roll-up costs and the losses in the Public Employee Retirement System, because of the downturn in the stock market.

If the tax increases are voted down, the Legislature’s special session in February will probably be devoted to finding a way to fill in the budget gap.

“It his highly unlikely that taxes will be considered,” Bentz said of the February session.

One suggestion is a sales tax, but Bentz said one Oregon legislative leader pointed out that the last time that issue was voted on, a sales tax only received about 30 percent support.

With education, human services and corrections being the largest budgets, those would be the areas most of the cuts would come from, Bentz said, with corrections being difficult because of voter-approved mandatory sentences.

“It will be difficult to select among good choices,” Bentz said. But, “The State of Oregon’s spending habits must be curbed,” he said, adding current spending can not be sustained.

“Budget cuts will be very painful,” he warned.

Randy Griffin, acting president of Treasure Valley Community College, said Oregon community colleges have been told they would be responsible for about $24.9 million dollars and they are to submit proposals for five percent and 10 percent reductions in state funding. For TVCC, that would mean a reduction of $471,354, at the 5 percent level and $941,787 at the 10 percent level.

“We don’t know how we will handle the cuts,” Griffin said. “They could hold community college harmless.”

If the governor made the cuts, it will be straight across the board, Griffin said.