May 2, 2017
May 2, 2017
For more than 15 years, Oregon’s major business groups, trade associations and elected officials have worked together to build the Oregon Business Plan. The partnership between business leaders and elected officials has accomplished many important initiatives in education, health care, transportation, water and forest management.
Oregon’s economy is thriving right now, outperforming the nation in job growth, one of our key goals. Businesses are growing and hiring. We’re seeing rising incomes, reductions in poverty, better healthcare outcomes and as a result, record state revenues.
However, we face a fundamental challenge to our state’s fiscal well-being: A structural budget deficit stretching before us for at least a decade. Unless we find a remedy, severe strain on state budgets will impede our ability to provide key services — education, health care, transportation and more — that are vital to Oregonians’ quality of life and prosperity.
Business leaders have held dozens of meetings since the Oregon Business Plan Leadership Summit in December with legislators and other interests concerned about the urgent need to address the toll that runaway costs and expanded services are taking, and will increasingly take, on the state’s fiscal well-being. At the summit we outlined a three-part framework for addressing the budget deficit:
1. Grow the economy. Maintaining Oregon’s robust economy is the best way to generate more revenue.
2. Make structural spending reforms to slow the unsustainable growth of government costs and tie spending to outcomes.
3. Adjust the current tax code, including taxes on business, to generate more revenue for investment in key areas such as high school and college completion and workforce development and innovation.
Proposals to curb future budget growth, outlined last week by a bipartisan legislative work group, are encouraging. Those proposals and new restraints on other cost drivers must be translated into lasting structural governmental reform. To build support for new tax revenues, Oregonians must be convinced that new investments will be used to achieve the outcomes all our children deserve.
If structural spending reforms necessary to match existing revenue can be achieved, here are some examples of strategic investments with clear outcomes we would support funding with additional revenues:
– The voter-approved Measure 98 to raise high school graduation rates and better prepare students for career opportunities through career and technical education programs.
– A K-3 literacy initiative intended to have third graders reading at benchmark level. Students who read well at third grade are much more likely to graduate from high school.
– Key investments in post-secondary education to improve affordability, access, student retention, degree completion and align with workforce development programs.
We have no illusions that reining in runaway costs and raising new revenues will be easy.
That includes holding down public sector health care costs and making sure the public pension system is financially secure for all employees. It also requires that we are prepared to look at additional taxes, including taxes paid by business, with the new revenue targeted at specific outcomes Oregonians want, such as improved high school graduation rates, literacy and classroom attendance time.
As Oregonians we share many values and have worked together for years to achieve results that have made this state great. We said in December we would roll up our sleeves, and we have been doing just that.
We remain optimistic that lawmakers in Salem can successfully address both long-term costs and revenues. The alternative is to do neither and kick the can down the road, again. Oregon’s economy is robust. Fixing the state’s structural fiscal problem in good economic times is far better than waiting for the next recession to decimate our schools and hurt our most vulnerable neighbors.
no comments yet
Stay up to date with the latest political news and commentary from Oregon Business Report through daily email updates:
Prefer another subscription option? Subscribe to our RSS Feed, become a fan on Facebook, or follow us on Twitter.