Wednesday, November 19, 2008

More Bleak News

I don't wish to be known as a "Negative Nellie", but I think reporting the news (good and bad)is important in the grand scheme of things. Hopefully folks will become more proactive around this stuff than reactive. From the Eugene Register Guard...

State revenues plunge, cuts planned
By David Steves

The Register-Guard

Published: Nov 19, 2008 09:51AM

SALEM — Oregon’s state revenues took their sharpest quarterly plunge since statehood, falling by $718 million, economists reported Wednesday.

The grim news triggered Gov. Ted Kulongoski’s call for across-the-board cuts of 5 percent from education, human services and public safety programs, which could take effect as soon as January.

The 4.6 percent drop since September is the largest, as a percentage of state general fund resources, since 2002, when those income tax and other revenues fell by 4.9 percent in a three-month period. In dollars, the dropoff was $506 million.

The plunging revenues, triggered by the national economic crisis, mean fewer dollars for public schools and universities, health care and safety-net programs and public safety.

The bleak news hit on two fronts. For the upcoming two-year spending cycle, which begins in July, Kulongoski and the Legislature are on track to fall $831 million, or 5 percent, short of the $16.9 billion needed to maintain all programs at their current levels.

For the current budget, which ends June 30, the Legislature and governor will have to find $142 million to keep the budget balanced.

Kulongoski said in a statement that across-the-board cuts to close that gap represented 1.2 percent of the overall 2007-09 budget. But since they would only apply to the biennium’s final six months, they would represent 5 percent of remaining spending for general-fund programs.

“Today’s forecast shows the depths of this recession and the economic uncertainty facing our state and our nation right now,” he said. “This recession demands tough decisions and requires shared sacrifice — and today’s action is the first of many difficult decisions that lie ahead.”

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