Promising State Revenue Forecast
Image: Bradley W. Parks / OPB
Tax Revenues Projected to Come in Much Higher Than Anticipated, Yet Many Still Hurting
Excerpt from Feb 24 OPB Story
The improved budget outlook — unthinkable at the time the COVID-19 pandemic set in nearly a year ago — is the last revenue forecast lawmakers will see before they offer a first-draft framework for the state’s next two-year budget in early March. The financial update comes as many Oregonians are still suffering from lost income and some businesses are struggling to survive. Economists in recent months have said those difficulties are more than offset by large businesses’ profits and affluent people doing better during the pandemic, along with stability brought by federal aid.
But the improved forecast isn’t a guarantee against budget cuts. While the state now anticipates having more money than expected left over from the current budget, that may not be enough to avoid some cuts as demands for public services increase and costs rise.
“Today’s revenue forecast brings some welcome news, as we see that state revenues are on the rise, making it clearer that the impact of the latest recession on income tax revenue is significantly smaller than we had estimated it to be last spring,” Gov. Kate Brown said in a statement. “Even with this good news, it is important to move forward cautiously, as the road ahead remains unpredictable. We also know that many Oregonians are still struggling with job losses, underemployment, and making ends meet.”