Home arrow COSA Blogs arrow Revenue takes downturn, most of SIF to be released, but across-the-board cuts appear likely
Revenue takes downturn, most of SIF to be released, but across-the-board cuts appear likely Print E-mail

by Craig Hawkins, Communications Director

State revenue is expected to decline by $165.9 million in the 2007-09 (current) biennium and $718.4 million in the 2009-11 biennium, compared to the September forecast.  This information comes from the December 2008 Economic and Revenue Forecast presented to the House and Senate Revenue Committees by the Office of Economic Analysis this morning.  The 2007-09 decline results in an ending fund balance for the state of negative $142.1 million.  Because Oregon is required to have a balanced budget, 2008-09 reductions in revenue for schools and other sectors of state government are already in the works.

One place that little revenue reduction is planned is in the School Improvement Fund.  COSA, along with education partners OEA, OSBA and ODE, have been working with the governor’s office since last week’s announcement of the governor’s request that ODE delay/withhold distribution of the School Improvement Fund.  As you can see in the this letter, the governor is now asking that $125 million of the $130 million SIF be released on November 24.  However, the letter also requests that ODE “reduce the monthly payments to school districts in the months of January through May 2009.”  This is part of the governor’s use of his “allotment authority” to do across-the-board reductions to balance the state budget.  K-12’s share of those across-the-board-cuts is about $75 million, which represents a revenue reduction of about $115 per student this year.  We will continue to work with our education partners and the governor’s office, and we will update you as developments occur and additional information becomes available.

Other key facts from the December revenue forecast:

  • Since the close of the 2007 Legislative session, overall estimated state revenue is down $322 million for the 2007-09 biennium.
  • In September, the forecast called for an ending balance of $23.8 million in the current biennium.  The $165.9 million decline in projected 2007-09 revenue results in the $142.1 million shortfall.
  • The 2009-11 forecast is down $718.4 million compared to September, with total decline since the close of the 2007 session of about $1.3 billion.
  • The Rainy Day Fund for this biennium now stands at $340.5 million, and the Education Stability Fund now stands at $393.4 million.

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This page was last updated on Wednesday, November 19, 2008 .