The Oregon Legislature’s lead budget writers proposed a $9.9 billion State School Fund on Thursday. Now the real negotiations begin.
The State School Fund bill, House Bill 5015, already says $9.9 billion, based on Gov. Tina Kotek’s recommended budget. But the Joint Ways and Means Committee makes the final decision on all state spending.
HB 5015 will have its first public hearing Monday in the Ways and Means Education Subcommittee. Education advocates are lining up to say it’s not enough.
“Districts are projecting widespread cuts in programs and staff at $9.9 billion,” OSBA Executive Director Jim Green said Thursday. “At a time of record state revenues, we urge the Legislature to find the resources to prioritize our students and fund schools at $10.3 billion.”
School business officials calculate that with inflation and soaring workforce costs, districts need at least a $10.3 billion State School Fund for most districts to avoid cutting staff, programs or days. Green pointed out that schools are also dealing with students’ increased social and emotional needs after the pandemic’s disruptions.
“We look forward to working with our state leaders and policymakers to find the resources and the political will to ensure our students are not shortchanged,” Green said.
Led by Co-Chairs Sen. Elizabeth Steiner, D-Beaverton, and Rep. Tawna Sanchez, D-Portland, the Joint Ways and Means Committee approves all Oregon spending. The Ways and Means Committee Co-Chair Budget Framework lays out $31.6 billion in expenditures, about $2.3 billion more than the 2021-23 budget.
Oregon must have a balanced budget, but funding can shift as legislators work out individual bill details. The framework includes hundreds of millions for housing and workforce investments that are still fluid. The framework also sets aside $325.6 million for critical state issues, including literacy. The framework notes that isn’t enough for all the investments sought.
Kotek released a statement praising the framework’s “thoughtful approach” while urging legislators to stay focused on housing and homelessness, behavioral health, and education.
The framework revealed education funding tradeoffs legislators are considering. The State School Fund amount includes the $1.5 billion corporate tax refund kicker. Several bills proposing possible education uses for the large, one-time windfall, from creating a construction fund to addressing workforce shortages, would be out of luck if the money all goes into the State School Fund.
The framework also uses corporate activity tax money in the State School Fund. The 2019 Student Success Act stipulated that some of the new corporate tax money go to the State School Fund to offset the personal tax cuts in the bill. The framework actually increases the act money going to districts through the Student Investment Account to $930 million.
The expenditures include $4 billion for the Oregon Department of Education, the Higher Education Coordinating Commission and the new Department of Early Learning and Care.
The framework is based on the Oregon Economic and Revenue Forecast released in February, but Oregon’s economy has been hard to predict in recent years. Tax revenues this biennium have far surpassed expectations, leading to a record $3.9 billion personal kicker and a $1.5 billion corporate kicker.
Growth has slowed, though, and economists have warned a recession is possible. The May 17 forecast will be the final word on how much the Legislature can spend.
– Jake Arnold, OSBA
jarnold@osba.org
