“Facing Reality” Report Offers Solutions to Governor Brown’s $1.7 Billion Budget Hole Without Raising Taxes

FOR IMMEDIATE RELEASE

Media Contacts:

Steve Buckstein (503) 242-0900

Jeff Kropf (541) 729-6229

PORTLAND, Ore. – Cascade Policy Institute and Oregon Capitol Watch Foundation jointly released a new report Wednesday, entitled Facing Reality: Suggestions to balance Oregon’s budget without raising taxes. The report offers practical solutions to fill Governor Kate Brown’s estimated $1.7 billion budget hole without raising taxes.

Facing Reality is the third budget blueprint in a series: In 2010 and 2013 Cascade Policy Institute and Americans for Prosperity-Oregon published Facing Reality reports that offered state legislators an opportunity to “reset” state government using the time-tested principles of limited government and pro-growth economic policies.

“Oregon has over one billion dollars more to spend than the last budget but is still nearly two billion short because Governor Brown’s budget continues out-of-control and unsustainable spending,” said Jeff Kropf, Executive Director of Oregon Capitol Watch Foundation. “It’s time to face the reality that raising taxes will never provide enough money to build the fantasy utopia envisioned by the Governor and current legislative leadership. There is no free lunch, and new taxes are only going to hurt the poor and the middle class.”

Facing Reality outlines $1.3 billion in reduced spending in seven specific areas which, coupled with small across-the-board agency reductions, equals $1.7 billion, enough to fill the Governor’s estimated budget hole and removing the need to raise taxes.

“Keep in mind that even with our Facing Reality budget reductions, the state of Oregon will still be spending more money than the previous budget,” said Steve Buckstein, Senior Policy Analyst and Founder of Cascade Policy Institute. “The reality the Governor and the legislature must face is that the bill for years of overspending is coming due, and raising taxes that hurt the economy is not the answer. Reducing how fast spending grows is the sustainable way forward.”

This third Facing Reality report offers politically possible solutions to meet the needs of Oregonians. It still gives most state agencies more money to spend, but without enacting new taxes being proposed by the several dozen tax increase bills introduced for consideration in the 2017 legislative session.

Here are the seven specific budget reductions proposed in Facing Reality:

Solution Impact
PERS—$100,000 cap $135 million
Department of Administrative Services—halt additional hiring $120 million
Medicaid—opt out of ACA expansion $360 million
Cover All Kids—reject expansion $55 million
Department of Human Services—targeted reductions $321 million
Department of Human Services—cash assistance reforms $160 million
State School Fund—reject Measure 98 $139 million
Total $1,290 million

For agencies not identified for specific reductions in the report, across-the-board reductions of about three percent from Governor Brown’s budget would eliminate the shortfall she identified. If this plan were implemented, none of the tax and fee increases outlined in the Governor’s budget would be necessary.

Buckstein and Kropf note, “Most Oregonians must face their own family budget realities every day. Facing Reality is a good-faith effort to hold our state government to the same budgetary realities. We look forward to working with state legislative and executive branch leaders to help implement such realities in 2017.”

Read the full report here: Facing Reality: Suggestions to balance Oregon’s budget without raising taxes

Founded in 1991, Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.  Oregon Capitol Watch Foundation is a 501(c)3 charitable educational foundation dedicated to educating Oregon citizens about how state and local governments spend their tax dollars by researching, documenting, and publicizing government spending and developing policy proposals that promote sound fiscal policies and efficient government.

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Press Release: Whistleblower Lawsuit Claims Oregon DHS Falsely Inflated “Healthy Kids Connect” Enrollment

February 8, 2013

FOR IMMEDIATE RELEASE

Contact: Steve Buckstein
               503/242-0900

Whistleblower Lawsuit Claims Oregon Department of Human Services Falsely Inflated “Healthy Kids Connect” Enrollment

…Cascade Policy Institute first reported inflated enrollment in its 2010 publication, “Facing Reality”

Portland, Ore. ― A former state employee has filed a $6.7 million whistleblower lawsuit against the Oregon Department of Human Services (DHS), saying she lost her job after pointing out financial irregularities and inflated enrollment projects for the state’s Healthy Kids Connect program.

Enrollment problems in the Healthy Kids Connect program were highlighted in “Facing Reality,” a report published by Cascade Policy Institute and Americans for Prosperity – Oregon in October 2010:

“Proponents of the program and DHS projected that the additional tax revenues would provide health insurance coverage to 80,000 Oregon children by the end of the 2009-11 biennium. However, with only a few months remaining in the biennium, the program has yet to enroll 26,000 more children to reach its projections.”

The complaint filed with the Marion County circuit court shows that as early as November 2009, there was evidence that the DHS projections were inflated:

“The press release draft stated Healthy Kids had a target enrollment of 80,000 kids. Plaintiff relied on three internal sources and the data revealed there were not 80,000 uninsured kids in the state.”

The complaint also alleges that DHS director, Bruce Goldberg, issued a directive regarding the method for counting the number of children enrolled in Healthy Kids. The method appears to be designed to inflate the number of children enrolled:

“In response to a question Plaintiff asked, [Healthy Kids staff member Melissa] Hanks provided Plaintiff with a document which outlined Goldberg’s directive on how the agency would calculate the number of enrollees. The document read, ‘For monthly caseload reporting on Healthy Kids Plan, we propose attributing any children’s caseload changes after June 30, 2009 to the HKP. This would generate the largest child count attributable to the HKP. That number will represent changes in caseload once Healthy Kids begins, and “Healthy Kids” become indistinguishable from all children.’ Plaintiff understood that any child enrolled in any state program was counted as ‘Healthy Kid’ for purposes of reporting enrollment. Enrollment was all children new to the program and all returning clients who have a gap in enrollment, which could be as short as one month. Plaintiff believed Healthy Kids took credit for the enrollment which predated the start of the program.”

In “Facing Reality,” Cascade Policy Institute called for ending the Healthy Kids Connect program. With the program sunsetting this year, the Legislature should make sure this troubled program ends with the sunset.

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Resetting Oregon’s Budget and Recharging Our Economy

Steve Buckstein
Cascade Commentary

Resetting Oregon’s Budget and Recharging Our Economy

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by Steve Buckstein

Oregon voters didn’t go as far as voters nationally this month turning out incumbent politicians, but we did replace a number of big-government state legislators with more fiscally conservative ones.

Reducing government spending is a big issue nationally, and a virtual necessity in Oregon due to our balanced budget requirement. Cascade and Americans for Prosperity-Oregon published our answer to this challenge last month in our report, “Facing Reality: Ideas to Reset Oregon’s Budget and Recharge its Economy.”

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