Oregon governor proposes spending to match her priorities

By PETER WONG
Oregon Capital Bureau

Gov. Tina Kotek’s recommended state budget focuses on new or continued spending on the key priorities she has laid out for her first year: Housing and homelessness, mental health and substance abuse treatment, and public schools.

In her budget message on Tuesday — one day ahead of the legal deadline for a new governor — the Democratic chief executive said more work remains. She proposes the added spending in a two-year, $32.1 billion budget from the tax-supported general fund and lottery proceeds, the most flexible sources of spending.

“We are not going to solve all the state’s problems within a single budget cycle,” she said in her message. “And with one-time federal resources expiring, future budget cycles may present difficult choices. That should not dissuade us, however, from demanding more and working hard to deliver results for Oregonians.”

Lawmakers have until June 30 to approve a series of agency and other budgets that constitute state spending. Unlike the presentation by the governor, the Legislature does not approve state spending in a single vote.

Total recommended spending from all sources is $116.5 billion, including federal grants and other sources that are earmarked for specific purposes.

Among the highlights for Kotek’s stated priorities:

Homelessness and housing: About $1 billion more for housing construction and preservation of existing housing deemed “affordable” — its cost is no more than 30% of household income, according to a federal definition. That amount is on top of $130 million she already has requested in the current budget for temporary shelters, rehousing and other services to keep people from being unhoused.

“These are critical investments to address the homelessness crisis that exists today,” she said. “But we know that the root cause of homelessness is the housing affordability crisis.”

Much of the new money for construction ($770 million) would come from bonds.

Mental health and treatment for substance use: As House speaker in 2021, Kotek helped steer $1 billion to such programs, including efforts to train new workers. She said her priority as governor is for state agencies to distribute the money to providers, including proceeds from marijuana sales redirected by a 2020 ballot measure and more from the federal-state Medicaid program.

“These steps will bring us closer to a holistic and culturally responsive behavioral health system so that no matter who you are or what you can pay, you are not alone,” she said. “Help will be there when you need it.”

Schools and child care: She proposes $100 million from bonds to build more early learning centers, $100 million targeted to student needs in reading skills, and $50 million for summer school programs.

“Child care is too expensive and nearly impossible to find for families across Oregon,” she said.

“For our public schools, children have the right to an education that will set them up for a lifetime of opportunity, but if they are not developing reading skills, it can have far-reaching impacts for the rest of their lives.”