Lawmakers Warn Oregon Budget Not Designed to Backfill Federal Spending Cuts
The battle of the budget was on colorful display in Gresham at the first of a series of Joint Ways and Means Committee roadshow hearings. Rep. David Gomberg. D-Otis, provided color commentary:
“Public employees were in purple, gun control advocates and teachers in red, county and municipal workers in green, food advocates in blue, and infrastructure advocates in orange vests and hardhats. … People lined the sidewalk leading to the theater, chanting and singing. It was friendly, but also a bit intimidating.”
A sobering moment came when Senator Kate Lieber, D-Beaverton, who co-chairs the Joint Ways and Means Committee, summed up the situation: “We are not going to have enough money to pay for everything. And if federal spending is cut, it will impact services to Oregonians. The state budget is not designed to backfill federal funding. The state budget is designed to draw down federal funds that provide critical services.”
Additional Ways and Means hearings are scheduled for Astoria, Warm Springs, LaGrande, Salem and Klamath Falls. Virtual testimony will be taken April 16 in connection with the Salem hearing.
Oregon is in relatively good position with an economic forecast projecting more revenue to spend than previously expected. However, state officials warn Trump administration spending cuts and blowback from Trump tariffs could jeopardize that revenue picture going forward.
Transportation Package
One of the biggest wildcards in the 2025 legislative session is how to close a gaping budget hole in the Department of Transportation as fuel taxes are being affected by increasing vehicle fuel efficiency and more motorists investing in electric or hybrid vehicles.
Lawmakers listened last week to presentations regarding road use charges to augment or replace the gas tax, including one from the Legislative Revenue Office describing the overhead cost of managing such a revenue system.
Members of the Joint Transportation Committee are expected to release a framework for a major transportation package in the near future.
Health Care
The Oregon Health Authority (OHA) reported an immediate loss of approximately $117 million in COVID-era grants and funding. The grants were scheduled to continue for a year or more. The money came from the Centers for Disease Control and Prevention and the Substance Abuse and Mental Health Services Administration.
The abrupt termination affect behavioral health initiatives, health equity efforts and immunization programs and impacts all nine federally recognized tribal communities and every county in the state. OHA is assessing the full impact of the cuts and exploring potential legal avenues to address the sudden loss of funding.
Lieber said the cuts undermine essential programs that ensure the safety and health of Oregonians. Rep. Tawna Sanchez, D-Portland,, also a co-chair of Ways and means, highlighted the state’s reliance on federal funds to maximize service reach while expressing concern over the challenges in maintaining these services without federal support.
Lawmakers approved last week House Bill 2010 extending assessments on health insurance plans and hospitals through 2032 to secure federal funding for the Oregon Health Plan. Governor Tina Kotek signed the bill into law, ensuring continued financial support for Medicaid services benefiting approximately one-third of Oregonians.
Medicaid funding cuts remain in the crosshairs of congressional spending decisions tied to extending the 2017 Trump tax cut, which expires this year.
The Oregonian reported the closing of 40-year-old Bridge House, a transitional housing program for homeless youth in Portland. Many of the 500 young people it served identified as LGBTQ+.
“Other years, you might go out and advocate and see if we can get extra money in,” said Executive Director Dennis Morrow. But this year, he said, with federal funding for social services highly unstable and the state and county facing their own budget woes, the effort to keep the program open seemed futile.
Public Education
The Trump administration continues its push to eliminate the U.S. Department of Education, raising questions about continuation of its funding for special education and children from low-income families.
Oregon Attorney General Dan Rayfield, along with 20 other Democratic attorneys general have filed a lawsuit challenging elimination of the Department of Education and some of its programs that support public education.
Firearms Regulation
Lawmakers introduced Senate Bill 243 that would impose a 72-hour waiting period for gun purchases, ban bump stocks and restrict individuals under 21 from purchasing semi-automatic weapons. The measure also would allow local governments to establish firearm policies in public buildings.
The legislation follows an Oregon Court of Appeals ruling upholding voter-approved Measure 114 that mandates permits for firearm purchases and bans high-capacity magazines exceeding 10 rounds. A District Court ruling had previously blocked enforcement of Measure 114.
The U.S. Supreme Court has ruled that states have the power to implement gun restrictions related to public safety.
