June 26 2019
A bipartisan group of Oregon lawmakers unveiled a proposal on Friday to reel in state spending during the upcoming budget cycle. The plan calls for a two-year hiring freeze on "non-essential positions."
It also would halt automatic budget increases tied to inflation for services and supplies. This comes as lawmakers are preparing to tackle a budget shortfall that's expected to reach $1.6 billion.
The proposal was unveiled during a Friday afternoon meeting of legislative budget-writers. Democratic House Speaker Tina Kotek opened the meeting by cautioning that the ideas were not the product of formal negotiations.
"I want to be very clear that these aren't products that have been agreed upon," she said. The goal behind the work group was to "get all the best ideas on the table from as many people as possible to get the conversation started."
The expected savings for the 2017-2019 budget cycle were not included in the proposal, which has some similarities with a plan pitched jointly by the Republican caucuses of the Senate and House. That plan was expected to save roughly $237 million in general fund dollars, according to an analysis by the nonpartisan Legislative Fiscal Office. But that analysis also characterized such a long-term hiring freeze as "unworkable and impractical."
Friday's cost containment proposal also comes one day after Oregon Governor Kate Brown announced an executive order to implement a two-month hiring freeze for all state agencies. The freeze is in effect from May 1 to June 30, and does not apply to positions considered critical to life, health or public safety.
Two Republicans sat on the five-member work group that produced Friday's cost savings proposal, which also examined ways to reduce the rate of increase in state spending on a long-term basis. House GOP leader Mike McLane of Powell Butte gave the proposal a qualified thumbs up. "While House Republicans have questions about the implementation and durability of these ideas, they nonetheless represent an encouraging starting point in a broader conversation," he said.
The plan drew immediate criticism from Oregon's largest state workers union. SEIU 503 President Steve Demarest called it "an effort to scapegoat people who have dedicated their lives to public service." Demarest said lawmakers should refocus their efforts on increasing business taxes. Those conversations are ongoing at the state capitol, but it's not clear if lawmakers will be to reach an agreement.
At least one business group praised the cost containment proposals. Patrick Criteser, the chair of the Oregon Business Plan Coalition, called it "an indication that legislative leaders are looking seriously at opportunities to put Oregon on a long-term path to a sound fiscal future." Criteser, who also serves as the CEO of Tillamook Cheese, said if lawmakers follow through on promises to reel in state spending, the business community "is prepared to look at new revenue, including taxes paid by business."
The number of state jobs affected by a hiring freeze wasn't estimated in the proposal. Neither was a clear definition of which kinds of jobs would be affected. House Democratic leader Jennifer Williamson suggested that essential jobs could include more than simply those at public safety agencies and hospitals.
"I'm concerned about case workers and home health care workers and those types of service providers, and where the line is," Williamson said.
Lawmakers have until early July to finish work on the upcoming budget. Most decisions won't come until after the release of the new revenue forecast, which is set for May 16.