So let's say, for the sake of argument, that you're building a household budget for 2019. Let's say you think you might have a shot at a 5 percent increase in income during the year; good work on your part.
But let's say that there are some items on the expenditure side of the budget that you've been putting off for years. Maybe the house finally needs that new roof. Maybe you need to find a bigger house. But you've done a little bit of financial work and you don't think that 5 percent boost in income is going to cover those expenses.
So you say, what the heck: You go ahead and build all of those expenses into your 2019 budget, even if you're not clear where the money will come from.
What you have isn't really a budget. It's more of a wish list.
Which brings us to Gov. Kate Brown and the budget plan she released last week. The big takeaway from Brown's proposed budget: She's hoping to work with legislators to find an additional $2 billion to help fund K-12 schools (and to help them pay off their growing bills for the state's public pension system) and to stave off what would amount to cuts in the state's higher education system.
But Brown is silent on how to raise that additional money; she says she plans to work with legislators to craft a revenue deal. She might be aided by the fact that Democrats finally have a three-fifths supermajority in each chamber of the Legislature, which allows them to raise taxes without a single Republican vote, but the supermajority margins are slender indeed: In the Senate, it would take the defection of just one Democrat to eliminate the supermajority.
So what this plan amounts to is a wish list.
To be fair, the governor's budget represents just a starting point, and will get a thorough working-over from legislators when they gather for their 2019 session. And Brown does have some business allies on her side in her negotiations for revenue increases, most notably the Coalition for the Common Good, a new organization that includes Nike and some of the state's powerful public-employee unions.
Brown also is hoping to gain allies from the state's public universities: Her proposal now includes no general fund increases for university programs, despite projected cost increases of more than 8 percent for the state's public pension system and health care costs.
To be fair, Brown has termed that unacceptable, and has offered a carrot to higher education: If legislators find that additional $2 billion, she'll earmark more than $580 million of that for higher education. But if the revenue deal falls through, higher education officials say they may have no recourse but to cut programs and impose double-digit tuition increases. (There's a catch to that as well: Tuition increases over 5 percent require the approval of the state's Higher Education Coordinating Commission, and Brown has lobbied that body in the past to keep a lid on those increases.)
So it could be that higher education officials will be in Brown's corner as the Legislature convenes — why pass up a chance to collect an additional $580 million? — but you couldn't blame them for having a sour taste in their mouths.
That sour taste could extend as well to Oregon taxpayers, who might point to the fact that the state, despite signs of a looming economic slowdown, will collect more tax money in the coming two-year cycle than ever before but still will be some $623 million in the red, thanks mostly to rising costs for the state's Medicaid program.
In the meantime, Brown has said she didn't put a revenue proposal of her own on the table because she didn't want to eliminate any options. At some point, though, she's going to have to show her cards for this proposal to get past the wish stage. (mm)