The signal was loud and clear this morning that lawmakers are coming after your kicker. In Salem, the state’s economists gave their quarterly revenue forecast to an interim committee of lawmakers. Surprisingly, even with high prices and increased interest rates, economists are still projecting short-term growth in tax monies coming into the state. In fact, they are projecting that monies coming into the state for the current two-year biennium will be an incredible $4.97 billion ahead of what they thought they would get when the wrote the current budgets back in 2021. This now means that the personal kicker will be somewhere around $3.7 billion when it’s paid out in 2024, or about $1,737 per Oregon taxpayer.
Not surprisingly, pro-tax lawmakers present at the committee meeting began to question the suspension of the personal incentive. This arose because some of these lawmakers are concerned that the state will not have enough funds in the next biennium (which begins July 1, 2023) to do everything it wants. Notably, Republican State Senator Lynn Findley defended the incentive and reminded the committee that the bar for suspending it was very high (two-thirds of the votes in both the House and Senate), and that trying to manipulate it was not the right path.
Some things never change, and some lawmakers will be quick to talk about taking more of your money. But one last point to remember: the state now has more than $6 billion in cash reserves it can use to weather any economic challenge. This unprecedented level of cash reserves should preclude any real talk of raising taxes or suspending the kicker. And given the small but positive changes in the legislature resulting from last week’s elections, it’s highly unlikely there will be enough votes to raise taxes or suspend the kicker. Elections matter.
By Taxpayers Association of Oregon Foundation
