Oregon economists revise revenue forecast, state will have extra $217 million to spend

Oregon lawmakers will have less money to spend next year than they anticipated after a promising revenue forecast released last week. 

The Office of Economic Analysis last week revised its December revenue forecast, saying it overstated an expected increase in tax collections. In fact, insurance tax collections are trending down, not up.

That means lawmakers will have an extra $217 million to spend next year, rather than the $335 million forecasted earlier this month. And they’ll still have plenty of demands for the money.

Gov. Tina Kotek plans to ask for at least $14 million for homeless shelters around the state. She also indicated she’ll seek some funding related to the recommendations from her task force to revitalize Portland, which will present its plan at a summit in December.

Lawmakers will likely also face pressure from school districts – including Portland Public Schools, which is weeks into a teachers’ strike – to send more money to districts undergoing budget crises. 

And after a failed citywide vote to enact a payroll tax, Salem city leaders have signaled they’ll press the state for more aid. The state, which doesn’t pay property taxes, owns about 8% of the land within city limits and employs roughly a quarter of the total Salem workforce. In other capital cities, including Olympia, Washington, the state government provides payments in lieu of taxes to account for costs to cities. 

The 2024 legislative session will begin Feb. 5 and can last up to 35 days. 

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Julia Shumway is deputy editor of Oregon Capital Chronicle and has reported on government and politics in Iowa and Nebraska, spent time at the Bend Bulletin and most recently was a legislative reporter for the Arizona Capitol Times in Phoenix. An award-winning journalist, Julia most recently reported on the tangled efforts to audit the presidential results in Arizona.