STEVE LAW
Statesman Journal
December 13
Gov. John Kitzhaber said Wednesday that state leaders need to
fill a $900 million hole in the state budget — $200 million larger than
anticipated two weeks ago — and patching it will require more than just
cutbacks and short-term reserves.
“I think the time has come for making some pretty difficult choices in this
state that will have a heavy impact on our future,” Kitzhaber told a panel of
reporters and editors from the Statesman Journal and Oregon Public Broadcasting.
Bulging demand for welfare, prison health care and other social services is
driving costs $100 million over budget, Kitzhaber said. Plus, he would like to
set aside an extra $100 million in reserves when he rewrites the 2001-03 budget,
in case the economy worsens next year.
“The real number, I think realistically, is closer to $900 million,” said
the Democratic governor, “which is about an 8 percent cut.”
Kitzhaber promised to release a revised “all-cuts budget” the week of Jan.
7, 2002 to prepare for a budget-balancing legislative session in February. But
he predicted lawmakers will balk at accepting that magnitude of cuts, and he
hopes to use that document as a starting point for negotiations over long-term
solutions, such as changing the tax code.
Kitzhaber declined to cite specific tax changes he might propose, but downplayed
the idea of promoting an increase in cigarette taxes. That would be hotly
opposed by cigarette companies and wouldn’t raise enough money, Kitzhaber
said, adding. “I’m not ready to talk about taxes until I produce my
budget.”
Lawmakers might be able to “cobble together a fix” through a mix of cutbacks
and using tobacco settlement dollars and other reserves, Kitzhaber said. “I
think that would be inappropriate.”
Relying on short-term cuts and short-term revenues will only put off the
state’s problems, he said. Revenues are expected to be $1 billion short for
the 2003-05 and 2005-07 budget cycles, he said, so spending all the reserves now
will only make future matters worse.
Tough decisions should not be postponed, he said, adding, “This happened on
our shift and we have the responsibility to fix it on our shift.”
Public schools will have to shoulder some cuts, Kitzhaber said. Schools and
colleges get 56 percent of the $12.3 billion general fund budgeted by the 2001
Legislature, so it’s impossible for them to escape unscathed. Education, human
services and public safety combined get 90 percent of the general fund, he said,
so that’s where he’ll have to look to make cuts.
Kitzhaber won’t call a special legislative session until votes appear assured
for a budget package, he said. But lawmakers need to act in February to restore
a balanced budget.
The governor also criticized U.S. Attorney General John Ashcroft and his
campaign to thwart Oregon’s assisted suicide law. “They’re making
criminals out of physicians, and it affects every doctor in America,” said
Kitzhaber, a former emergency room physician.
He also criticized high- tech industry leaders, who he said were clamoring for
more university engineering programs without regard for the state’s overall
budget crunch and other spending priorities.
Steve Law can be reached at (503)
399-6615.