Best advice on the 09-11 'number'? Delay budget process

“Don’t believe everything you think.” Not particularly philosophical but pretty good advice, especially when you’re figuring out how to respond to state and national economic news.

The most common question I am getting right now regarding the 2009-11 state budget and State School Fund is, “what’s the number.” Anyone new to Oregon should know that “the number” is a reference to the amount allocated by the legislature to the State School Fund for the next two years.

Following my own advice, I’m not going to share what I think it will be. In fact, my prediction is about as good as every prediction you’re currently reading in the newspaper. A prime example is the $3 billion shortfall reported in the past couple of days and coming from some of Salem’s leading political lights. At this point I’ll offer a second axiom for these political times, “don’t go toward the light.” Okay, the number originated in a remark from the state economist during a joint meeting of the House and Senate, but it wasn’t in the forecast and besides, the algebra of political necessity already has sent the number as high as $5 billion.

Here’s the situation. Oregon is facing a major shortfall in its income because our tax collections are based on income and lots of folks are out of work or going to be out of work soon. The truth is, no one really knows how many or how long. But, not knowing the numbers doesn’t deter the political class from coming to a clear realization that it has major service obligations and it needs to begin making a case for keeping them. Just look at the outcome of the legislative Session so far. A whole new fund, the School Day Restoration Fund, was created to send K-12’s first share in the Obama stimulus plan to local districts. That fund got its name from the public reaction to the reality of public schools closing their doors weeks early. The public wants its schools open and kids engaged.

Looking toward the next biennium, the legislature has received official estimates that put the shortfall at around $1.9 billion additional since the Governor’s budget was released. That’s it. There are no other numbers that describe the situation. Well, that isn’t enough to get the conversation among legislators, who are notoriously skittish when facing revenue issues, much beyond a beer tax and court paper filing.. In fact, the legislative equivalent of “don’t go toward the light” is something like, “don’t even think about raising taxes.” It will require a major public groundswell around seriously damaged public services to move legislators in this direction because the political calculus creates an equation that shows cut services cancelling raised taxes as a reason for lost elections. Hence, we are beginning to hear huge numbers. But, let me hasten to add, that doesn’t mean the numbers we’re hearing won’t come true – who knows?
All this still doesn’t answer the question of “when?” as applied to “the number.” Here’s a simple, but I think realistic, suggestion that will put anyone who follows it closest to building a budget on the real amount available for education next year – plan the meeting for final budget adoption for June 30 and then build your schedule backward from there to about the first of May. That’s when we get beyond the general estimates to the official revenue forecast that setting the income available to pay for the first version of the ‘09-‘11 budget. If you’re after strict accuracy, this will be your window of opportunity – about May 1 to June 30.
Legislative hearings on the State School Fund are over the next week and focused on Department of Education, regional programs and ESDs. Work on school districts’ allocation will come later, most likely as numbers reach the concrete rather than written in sand phase.

In the meantime, there are oodles of bills being considered by lawmakers aimed at improving education. We’ll be keeping you informed as these measures are considered and try to give you time to weigh into the political process on them.

We thought we’d add to your reading for the weekend with a copy of the School Restoration Fund Application questionnaire. As you look at this, realize that leading legislators view its collected information as a teachable moment for the legislature. It is expected to create a database on the districts in our state showing how they address this funding emergency, particularly the use of reserves and staff sacrifices, to save school days.

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This page was last updated on Tuesday, March 24, 2009 .