1990’s: State enjoyed huge economic growth and diversification Total gross state product increased...

1990’s: State enjoyed huge economic growth anddiversification• Total gross state product increased by 98% from 1991-2001.• High-tech industry growth.• Population growth – 11th fastest growing state.• Personal income grew at annual rate of 5.6%, exceeding the nation.• Exports increased by a compound annual rate of 5.8%.• State General Fund grew from $4,628.1 million in 1989-91 to

$10,121.8 million in 1999-2001 – dollars primarily went to K-12, Oregon Health Plan, and Public Safety.

• Kicker returned for personal income tax filers 7 times, totaling over $1.5 billion; for corporate tax filers 5 times, totaling over $400 million.

2003-05 All Funds

Transportation$2,672.8

6.0%

Natural Resources$1,388.9

3.7%

Consumer and Business Svcs.

$784.62.4%

Administration$6,909.4

14.4%All Other

$113.40.3%

Higher Education$4,153.8

11.1%

Other Education$2,219.9

5.2%

State School Funding

$4,930.613.9%

Economic and Comm. Dev.

$5,829.112%

Human Services$9,334.0

24.0%

Public Safety/Judicial

$2,472.87.0%

ResourcesTotal: $84,451.0 Million

ExpendituresTotal: $40,809.3 Million

Lottery$756.90.7%

Federal Funds$8,056.1

8.6%

Other Funds$23,680.8

27.6%

General Fund Revenues$10,217.4

13.0%Other Funds and

Federal Funds Beginning Balance

$41,739.850.1%

All Funds Expenditures


7.6%

Natural Resources$673.44.7%

Miscellaneous$274.81.9%Administration

$1,247.7 8.7%

Economic Development*

$3,199.522.3%

Public Safety/ Judicial$407.92.8%

Human Resources$3,563.524.7%

Higher Education$2,051.214.3%

State School Fund$1,176.1

8.2%

Legislative Branch$40.30.3%

Other Education$641.24.5%

Administration$3,551.512.0%Transportation

$2,059.17.0%


4.0%

Economic Development

$3,451.911.7% Public Safety/

Judicial$2,135.8

7.2%



5.9%

Higher Education$2,712.5

9.2%


Miscellaneous$146.20.5%

State School Fund$4,674.215.8%

Consumer and Business Services,

$511.51.7%


Miscellaneous$225.90.7%Administration

$4,033.511.8%

Consumer and Business Services

$812.92.5%


5.3%


3.8%


$4,102.412.0%

Public Safety/ Judicial$2,324.0

6.8%



5.6%



Administration$5,084.815.1%Consumer and

Business Services$850.62.2%


5.2%Natural Resources

$1,474.93.8%


$5,719.314.8% Public Safety/

Judicial$2,782.3

7.2%



4.9%




2001-03 Close of SessionTotal: $34,077.0 Million

2001-03 FinalTotal: $37,836.3 Million

1989-91 Legislatively AdoptedTotal: $ 14,360.4 Million

1999-2001 Legislatively AdoptedTotal: $29,576.8 Million

*Includes Consumer and Business Services

General Fund Forecast ComparisonFiscal Years, in MillionsGeneral Fund Forecast Comparison

Latest versus 2001 COS, Fiscal Years in Millions

3,000

4,000

5,000

6,000

7,000

8,000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

September 2004 Forecast Actual Revenues COS 2001 Forecast

Lottery Resources Available to the State

Office of Economic Analysis

Note: Resources do not include Video Lottery proceeds dedicated to the Counties. Beginning balance is included. 2003-09 debt service figures do not reflect any Education Endowment Fund or reserve earnings designated for debt service on education bonds.

0

100

200

300

400

500

600

700

800

85-87 87-89 89-91 91-93 93-95 95-97 97-99 99-01 01-03 03-05Proj.

05-07Proj.

07-09Proj.

Descretionary Resources Education Stability Fund (15-18%) Parks & Natural Resources (15%)

Debt Service Gambling Addiction Treatment (1%)

1989-91 General & Lottery Fund ExpendituresTotal: $4,804.6 Million

Public Safety/Judicial$631.013%

All Other$898.919%

Other Education

$308.76%

State School Fund

$1,176.125%

Higher Education

$693.314%

Human Resources$1,096.6

23%

1999-2001 General & Lottery Fund ExpendituresTotal: $10,613.2 Million


$1,557.815%

All Other$606.5

6%Other

Education$832.6

8%

State School Fund

$4,567.542%

Higher Education

$761.27%


22%

2001-03 Legislatively Approved General Fund & Lottery Funds Budget - End of Biennium

Total: $10,426.7

Higher Education$761.2

7%


24%


40%

Other Education$730.4

7%

All Other$618.4

6%


$1,635.516%

2001-03 Legislatively Approved General Fund & Lottery Funds Budget - Close of Session

Total: $11,973.9

Higher Education$814.3

7%


41%


$1,761.715%

Other Education$835.2

7%

All Other$899.6

8%


22%

Approved General Fund & Lottery Funds

2 of 2

Human Services$2,278.7

21.5%

Higher Education

$679.56.0%

P ublic Safety/ J udicial$1,600.4

14.5%

All Other$654.35.3%

Other Education*

$833.97.5%

State School Fund

$4,904.645.2%

2003-05 Legislatively Adopted General Fund and Lottery Funds Budget

*Includes Oregon Health Sciences University

ExpendituresTotal: $10,951.4 Million

RevenuesTotal: $10,974.3 Million

Corporate Income Tax

$475.34%

All Other $666.6

4%

Tobacco Tax $112.3

1%

Lottery $756.9

6%Insurance

$120.11%

Personal Income Tax

$8,843.184%

General Fund and Lottery Funds by Program Area

$-

$1,000,000,000

$2,000,000,000

$3,000,000,000

$4,000,000,000

$5,000,000,000

$6,000,000,000

$7,000,000,000

Educa

tion

Human

Res

ourc

es

Public

Saf

ety

Econ

Develo

pmen

t

Natur

al R

esou

rces

Trans

porta

tion

Consu

mer

Ser

vices

Admini

strat

ion

Legi

slativ

e Bra

nch

Judic

ial B

ranc

h

Misc

ellan

eous

1989-91 LAB

2001-03 LAB

2003-05 GBB

2003-05 LAB

* Excludes additional PERS savings of $191.5 million that is used to balance the Governor’s Revised Budget and includes new discretionary resources.

State School Fund Level

What has caused the General Fund expenditure growth since 1989?

• Primary– Population– Initiatives– Policy decisions

• Secondary– Inflation– Lawsuits

State and Local Resources for K-12 School Funding

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

1989-91

1991-93

1993-95

1995-97

1997-99

1999-01

2001-03

2003-05

2003-05 O

ld Proporti

ons

State

Local

Bil

lio

ns

of

Do

lla

rs

Estimated Impact of Measure 11 on Oregon’s Prison System

0

1000

2000

3000

4000

5000

6000

Ja

n-9

5

Ja

n-9

6

Ja

n-9

7

Ja

n-9

8

Ja

n-9

9

Ja

n-0

0

Ja

n-0

1

Ja

n-0

2

Ja

n-0

3

Ja

n-0

4

Ja

n-0

5

Ja

n-0

6

Ja

n-0

7

Ja

n-0

8

Ja

n-0

9

Ja

n-1

0

Ja

n-1

1

Ja

n-1

2

Ja

n-1

3

Ja

n-1

4

Ad

dit

ion

al

Inm

ate

s

Direct Impact

Indirect Impact

Historical October 2004 Forecast

Office of Economic Analysis, October 2004

Department of State Police2003-05 Governor’s Balanced Budget

Sworn Positions

665

547 540 547 537 512 517

427 440 450

542

461

329 329

115

122 120 120 115112 116

121 122 122

128

119

107 119

77

78 105122 134

121145

125 129 126

126

116

113123

80

86105

102 108139

118

148 144 156

129

111

8686

0

100

200

300

400

500

600

700

800

900

1,000

1979-81 1981-83 1983-85 1985-87 1987-89 1989-91 1991-93 1993-95 1995-97 1997-99 1999-01 2001-03 COS 2003-05 GBB 2003-05 LAB

Patrol Services Fish and Wildlife Criminal Investigation Other

937

833870 891 894 884 896

821 835854

925

807

635657

Policy Decisions• Oregon Health Plan (OHP)

The Office of Medical Assistance Programs budget has increased significantly since 1989-91. The General Fund and tobacco funded portion has increased from approximately $201 million to $1.21 billion.

OMAP (OHP Included) Growth by Fund

$-

$500,000,000

$1,000,000,000

$1,500,000,000

$2,000,000,000

$2,500,000,000

$3,000,000,000

$3,500,000,000

1989-91 1991-93 1993-95 1995-97 1997-99 1999-01 2001-03 2003-05LAB

Co

st

TF GF + TTX +TS

(General Fund,Tobacco Tax,

Tobacco Settlement)(Total Funds)

Other Issues

• General Risk

• Reserves/Other Fund Balances

• PERS/Labor

• Kicker

• Additional Lawsuits

• Bond Rating

• Annual Sessions

• Accountability/oversight vs. Reduced Administration

• Regulatory Reform

• Economic Recovery

• Pent-up Budget Demand

• Potential Initiatives

• One-time Revenues

1990’s: State enjoyed huge economic growth and diversification Total gross state product increased...

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