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Governor Ted Kulongoski warns Storm is brewing
by Ralph Metcalf - The Oregon Herald
  Monday April 5, 2010 - 6:06 PM
 
PORTLAND — Outgoing Governor Ted Kulongoski last Friday urged candidates to join him in promoting kicker reform, “a litmus test” for anyone seeking the governorship. Kulongoski said he “described the state of our state this way: Skies clearing — and a potential storm brewing” to characterize Oregon’s tentative emergence from recession, with economic uncertainty and a state budget deficit ahead.

In his final state of the state speech, the Governor called for policymakers to change the state’s tax rebate system, which sends “kicker” checks to taxpayers when and if the state collects substantially more revenue in a biennium than state economists had predicted would come in. Kulongoski wants the state to continue kickers rather than give it to taxpayers.

“If we want to keep that brewing storm I mentioned safely off shore, fixing the kicker must be our top economic priority,” he told an audience at a Portland State University conference center.

Kulongoski wants half of all surplus “kicker” revenue for a state government reserve to help pay for education, human services and public safety during lean economic spells when state revenues drop. After a certain level, revenues exceeding economists’ forecasts would be returned to taxpayers, he said.

Kulongoski called it “the best antidote to the argument that we have to keep raising taxes.”

Campaign managers for both the leading Democrats in their primary, Bill Bradbury and John Kitzhaber, said they were ready to pick up the cause, should either of them succeed Kulongoski as governor.

Not surprising, Republicans oppose Kulongoski’s idea. The campaign for GOP hopeful Chris Dudley released a statement quoting Dudley as saying that while he wanted to build up state savings, as Kulongoski wants, it should not be done through changes to the kicker program.

“I do not believe in litmus tests and I do not believe in keeping taxpayer dollars that are protected by our constitution,” said Dudley, who prefers setting aside 3 percent of revenues into reserve for education and essential programs to tap “during times of severe economic downturn.”

Republican candidate Allen Alley called for taking one-half percent of state government’s overall budget and placing it into reserve. The state would continue to take one-half percent out of its budget to repay state debt.

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