State budget forecast to yield kicker


Schools line up for extra funding as state releases optimistic budget forecast.

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BY JACOB PALMER | DIGITAL NEWS EDITOR

Oregon taxpayers will get a tax refund of $473 million, a state budget forecast released Thursday revealed.

The refund will come as a tax rebate and not a personal check, the Portland Tribune reports.

It would be the first such rebate in eight years, following a record $1.1 billion payout in late 2007, just before the official start of the most recent economic downturn. But unlike in the past two decades, the money will not come in the form of checks mailed to taxpayers in the fall. Instead, as a result of a change lawmakers made in 2011, the money will be credited against 2015 income taxes, returns for which are due in April 2016.

Known as a “kicker,” the money results when actual tax collections exceed budget projections for the state’s two-year cycle by 2 percent or more. Under the 1979 law, the entire amount above the projection — not just the excess above 2 percent — is returned. The exact amount will not be known until the state’s next quarterly economic and revenue forecast, which is scheduled Aug. 26, about two months after the close of the 2013-15 budget cycle.

As a response, schools are urging lawmakers to allocate extra funding.

From a separate Portland Tribune story:

“So we are trying to have a measured approach by using some of these dollars to invest now in education, health care and public safety — and trying to keep an eye on where we are heading in 2017,” said Rep. Peter Buckley, a Democrat from Ashland who is House co-chairman of the joint budget committee.

Lawmakers’ tasks were made easier by the forecast, which directed that 40 percent of the higher projection go to the state school fund. Oregon’s 197 school districts draw the lion’s share of their operating costs from the state budget. That total amounts to $105 million more, in addition to the $7.255 billion that Democratic majorities pushed through in April.

A group of 10 students were arrested at the Capitol, pushing legislators for more education funding instead of sending out a kicker.

The Statesman Journal reports:

Many students blocked the hallway chanting their opposition to a personal income tax refund — a practice in Oregon known as “the kicker.” The possibility and size of a kicker is typically a key subject of interest at the revenue forecast. The students instead yelled support for greater funding for post-secondary education. Those arrested were taken to the Marion County jail on charges of interfering with legislative operations, said Lt. Bill Fugate of the Oregon State Police.

Emma Kallaway, executive director of the Oregon Student Association, confirmed that Associated Students of the University of Oregon president Beatriz Gutierrez was among those arrested by state troopers. A small group that interrupted the committee hearing was escorted out of the hearing room and joined about 25 other students laying in the hallway holding signs and chanting.

Educators in Central Oregon are hoping the rosy budget forecast will mean no teacher cuts.

From the Bend Bulletin:

“This will allow us to direct more dollars to our classrooms,” [chief operations and financial officer Brad] Henry wrote in an email to The Bulletin, calling the extra money “a solid step towards the right direction.”

The Legislature approved $7.255 billion for K-12 schools for the 2015-17 biennium but included a trigger that would send 40 percent of new revenue to schools if the economy showed improvement in the May economic forecast. School leaders statewide had said they needed at least $7.5 billion over the two years. Bend-La Pine’s proposed $151 million general fund budget called for cutting about four teachers, which would raise the student-teacher ratio by about one student in kindergarten through second grade. It included lower cost-of-living increases for employees and a lower end fund balance than originally planned.

 




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