SearchHomeMenuSign UpDonate

The Swing of the Budget Ax

Fact Sheet
July 12, 2010 Download PDF

An Outline of Oregon’s Likely Service Cuts Absent Congressional Help

[Revised July, 14, 2010]

Life just got tougher for many Oregonians, now that the budget ax has swung again. In May the Oregon state economist announced that the recession struck Oregon harder than previously estimated, prompting him to project a General Fund deficit of about $577 million for the current two-year budget period ending June 30, 2011. In response, the Governor ordered across-the-board cuts to Oregon’s General Fund budget — of which more than 90 percent goes to education, health and human services and public safety.

The cuts amount to 4.6 percent of the General Fund budget for 2009-11, which translates into about 9 percent of the budget for the final year of the two-year budget period.[1] This fact sheet provides examples of the cuts that agencies submitted in response to the Governor’s order.[2]

Oregon is not alone in feeling the pain. Nearly all states in the nation face shortfalls, which together could total $140 billion in the coming year.[3] Oregon’s cuts would certainly be greater but for voters’ approval last January of Measures 66 and 67, which are now generating additional revenue. Without those funds, the cuts required this year would have been much deeper.

There is still a chance Congress will provide additional funding to help states cover their shortfalls. But even if federal help arrives, it won’t be enough to cover Oregon’s entire revenue shortfall.

Impact on students

Reduced access to early child development programs

Increased unemployment, larger classes and shorter K-12 school years

Higher community college tuition, reduced access to programs

University students relatively unscathed this time

Impact on children and families

Fewer supports to ensure babies and children with developmental disabilities are healthy and well cared for at home

Impact on low-income Oregonians

Reduced benefits for families with dependent children

The Oregon Health Plan escapes significant cuts

Reduced access to child care for working families

Fewer services for homeless Oregonians

Reduced reimbursements for care providers

Impact on seniors and Oregonians with physical or mental disabilities

Fewer supports to help adults with developmental disabilities or mental illness find work and participate in their communities

Cuts to supports that allow seniors and adults with disabilities to stay in their homes

Impact on public safety and public safety workers

Backlog and delays in crime lab investigations

Lower quality of supervision and treatment of youth offenders



Endnotes


1. The proposed cuts are not truly “across the board” but in fact vary by individual program. Some agencies chose to spare certain programs within a given expenditure limitation while making larger cuts in other programs. Also, the Governor has stated his intention not to close three prisons, as the Department of Corrections proposed, and asked the Emergency Board to provide sufficient reserve funds to keep them open. The Oregon University System had banked sufficient reserves not only to absorb the reduction in its direct allocation but also to make up for the cut in scholarship funds administered by the Oregon Student Assistance Commission.

2. Governor Ted Kulongoski, “Governor Orders Allotment Reductions to Balance 2009-2011 Budget,” press release, June 22, 2010, available at governor.oregon.gov/Gov/P2010/press_062210.shtml. Oregon Department of Administrative Services, Budget and Management Division website, www.oregon.gov/DAS/BAM/0610AgencyAllotmentReductions.shtml, contains links to budget allotment reduction spreadsheets submitted by each agency. In the footnotes below, these will be identified by the agency name as listed on that page, the section name on the agency page, and the line item on the spreadsheet.

3. Erica Williams et al., New Fiscal Year Brings More Grief for State Budgets, Putting Economic Recovery at Risk, Center on Budget and Policy Priorities, June 29, 2010, available at www.cbpp.org/cms/index.cfm?fa=view&id=3222.

4. Department of Education, Prekindergarten, $5,095,573.

5. Department of Education, early intervention program, $5,152,883.

6. Department of Education, state school fund, $237,973,291.

7. Anne Williams, “Tough Times Cut the Calendar,” Register-Guard (Eugene, Oregon), June 25, 2010, available at www.registerguard.com/csp/cms/sites/web/news/cityregion/24935976-41/oregon-eugene-cutting-education-instructional.csp.

8. Kimberly Melton, “Oregon schools consider eliminating programs and restructuring to cover state funding shortfall,” The Oregonian, June 28, 2010. Portland Public Schools is planning to eliminate physical education in elementary and middle schools, while other metropolitan districts are cutting four to 10 days from the school year and 15 to 180 staff positions.

9. Community Colleges and Workforce Development, state funding, $20,852,934.

10. Oregon University System, education, $26,689,283 to be taken from reserves.

11. Oregon Health and Science University, education, $3,121,204.

12. State Commission on Children and Families, $2,317,322 .

13. Department of Human Services (DHS), Children, Adults and Families (CAF), eliminate the TANF Cooperation Incentive Payment and add half to the TANF base grant, $3,495,580.

14. DHS, CAF, reduction in JOBS services, $5 million.

15. DHS, Division of Medical Assistance Payments, May financial update net savings, $8.7 million; tobacco tax forecast increase, $10,056,000; provider insurance forecast increase, $17,643,652.

16. DHS, CAF, Employment Related Day Care (ERDC), $17,346,182.

17. Housing and Community Services, State Homeless Assistance program, $382,179.

18. DHS, Seniors and People with Disabilities (SPD), reduce DD comprehensive service rates, $4,901,982, nursing facility payment reduction, $5,509,600, and community facilities payment reduction, $3,651,105.

19. SEIU-Home Care Commission collective bargaining agreement for 2009-11, available at www.dhs.state.or.us/spd/tools/cm/homecare/0911_contract.pdf. Home care workers in Oregon earn $10.20 per hour in 2010. A single wage earner working full-time at that rate would not maintain a family of four above the federal poverty level.

20. DHS, SPD, eliminate Medicaid personal care program, $762,898, and eliminate DD Family Support Program, $1.8 million.

21. DHS, Addictions and Mental Health, mental health programs, $4,249,016.

22. DHS, SPD, Medicaid Title XIX home delivered meals, $739,196.

23. DHS, SPD, eliminate Oregon Project Independence, $7,612,665, and in-home care program, $8,215,534.

24. Oregon State Police, Forensics/Medical Exam, forensics services, $1,272,864.

25. Oregon Youth Authority, suppression of operational expenditures, $6.6 million, management actions, $1.1 million, and emergency reduction actions, $2,027,900.