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Oregon predicted to lose almost $10.5 billion in revenue over next 5 years

Oregon economists delivered a bleak revenue forecast for the state over the next five years, predicting losses of almost $10.5 billion through 2025.

Posted: May 20, 2020 11:05 AM
Updated: May 20, 2020 1:29 PM

SALEM, Ore. — Oregon economists delivered a bleak revenue forecast for the state over the next five years, predicting losses of almost $10.5 billion through 2025. The state's latest economic outlook report came out on Wednesday, with lawmakers quickly voicing their reactions.

Unsurprisingly, the outsized impact on Oregon's revenue was attributed to the coronavirus pandemic and the state's response, which has resulted in mass lay-offs and record unemployment.

Experts say the recession is "extremely severe" and the deepest we have seen since 1939. But they said the economy should return to good health by mid-decade, making it shorter than the great recession of 2008.

Oregon officials predicted a "strong initial rebound" when COVID-19 restrictions are lifted, but said that the rally will be incomplete. Moreover, economists reported that the state's reliance on income taxes has made its revenue outlook "more volatile than in most states."

Gov. Kate Brown issued a statement shortly after the revenue forecast came out, pointing toward the federal government for help in making up for the major revenue shortfalls.

“The latest forecast for state revenue makes it clear that we have tough choices ahead. We will need to tighten our belts. I am working with legislative leaders to preserve critical state services, find efficiencies, and prepare for potential budget cuts," Brown said.

“Make no mistake, the budget gap created by this pandemic is too large to bridge without additional Congressional action," she continued. "I am thankful for the work of our congressional delegation to secure federal funding for Oregon in the relief packages Congress has passed so far. But those funds only address a fraction of our current need, especially since we are not permitted to use the funding we have received so far to address state budget shortfalls."

Lawmakers on both sides of the aisle quickly added their voices to the response. For Senate Republican leader Fred Girod, R-Stayton, the blame lay with Brown's enduring coronavirus restrictions.

“Oregonians had a clearly defined goal from the beginning of the COVID-19 pandemic: to flatten the curve. Governor Brown’s insistence to keep Oregon’s economy shutdown despite flattening the curve weeks ago, has cost Oregon billions of dollars of revenue, impacting generations to come," Girod said. "This revenue loss could have been mitigated if the Governor had been a leader and opened our state weeks ago.”

House Speaker Tina Kotek, D-Portland, struck a more hopeful note — referencing a rainy day fund that the state has worked to fill.

“Fortunately, our state is in a far better financial position than it was at the start of the Great Recession," Kotek said. "We have strong reserves that should be tapped early to avoid additional damage to our economy. I also believe increased bonding for public infrastructure will help to jumpstart the economy and put people back to work."

Oregon Coronavirus Cases

Data is updated nightly.

Cases: 156287

Reported Deaths: 2252
CountyCasesDeaths
Multnomah31935542
Washington21311212
Marion18541285
Clackamas13426183
Lane10325129
Jackson8489114
Umatilla767882
Deschutes597561
Yamhill379168
Linn360157
Malheur335358
Polk307343
Klamath279855
Douglas252755
Josephine236553
Benton234817
Jefferson196628
Coos152420
Union129519
Columbia127421
Wasco122126
Lincoln113620
Hood River106929
Morrow104914
Clatsop7776
Crook77618
Baker6639
Curry4296
Tillamook4212
Lake3786
Harney2776
Grant2251
Wallowa1425
Gilliam541
Sherman530
Wheeler221
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