Oregon’s New Umbrella: The Rainy Day amendment
What if Oregon could enjoy the fastest economic growth of any state over the next five years? What if, over the next two years, Oregon could build a rainy day fund in excess of $2 billion to help cushion inevitable future economic downturns?
The first scenario is what actually happened in Colorado from 1995 through 2000, the first five years of its Taxpayer Bill of Rights or TABOR amendment.
The second scenario is what forecasters predict will happen here over the next two years if Oregonians pass a spending limitation known as the Rainy Day Amendment on the November ballot.
Colorado’s TABOR amendment is actually quite different from the proposed Oregon Rainy Day amendment. While both limit government to the growth of inflation plus population, TABOR requires that revenue above its limitation be returned to taxpayers, and it ratcheted down government budgets during the recession earlier this decade.
Oregon’s Rainy Day amendment says that excess revenue can either be kept in a rainy day fund or returned to taxpayers. Oregon’s amendment has no ratchet down mechanism, so during recessions the rainy day fund can help maintain state spending.
The Rainy Day Amendment thus offers the best features of the Colorado limitation, which led to strong economic growth during the boom, while avoiding the worst features that kept Colorado from easily adjusting to the bust. Oregonians who want their government to be fiscally responsible should seriously consider the opportunity it presents.
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