By Yuxing Zheng
The Oregonian
PORTLAND, Ore. — When the Oregon Legislature convenes Monday, two large state agencies will be asking for tens of millions of dollars.
Lawmakers will revisit the 2013-15 budget to address collective bargaining costs, a record $40 million wildfire season and revenue forecasts that fell $70 million short of earlier projections.
Most problematic are the budgets for the Department of Corrections, which is housing about 200 more inmates than projected, and the Department of Human Services, which administers social services for elderly, disabled and poor Oregonians. One lawmaker said she feared the state might need to reopen a prison.
Corrections officials say they need about $90 million, and Human Services officials say they need about $100 million to fill their gaps, though some money is expected from other sources.
The budget gaps, however, are nowhere near the cuts state agencies saw at the height of the recession and, in many cases, represent a small percentage of their overall budgets, said Sen. Richard Devlin, D-Tualatin and co-chair of the budget committee.
“The basic reality is that we will have adequate resources to perform the services that need to be provided, and agencies may need to tighten their belts a little more,” he said.
Although the 2013-15 budget is set, lawmakers can revisit the budget every few months.
Central to budget discussions next month will be how much should be released from the $154 million that lawmakers held back from state agencies last year, after the previous budget cycle ended with less money than expected.
The agencies, with the exception of most education programs, saw 2 percent withheld from their general fund budgets. For large departments such as Human Services, that totals about $46 million, an amount that could affect programs.
Releasing all of the $154 million would leave the state with about $25 million projected at the end of the budget cycle, Devlin said. “If we were to do that, we’d be within a very high probability of going into the red, which we won’t do,” he said.
Current discussions would return about a quarter of the withheld money to state agencies, he said.
Human Services, which receives more than two-thirds of its money from the federal government, is also expected to lose about $8 million to federal sequestration cuts.
“We do have some significant budget challenges,” Human Services Director Erinn Kelley-Siel told a panel of lawmakers two weeks ago. “We know we’re going to have to have harder conversations.”
In Corrections, sentencing reforms were expected to save about $19 million in the 2013-15 budget cycle. But the department has 200 more inmates than anticipated, said Linda Gilbert, the agency’s principal legislative analyst.
“The big picture for the Department of Corrections is that it can be very serious, because we’re talking about possibly having to reopen institutions, and that’s very costly,” said Sen. Jackie Winters, R-Salem, co-chair of the public safety budget subcommittee. “We’re hoping we don’t have to reopen a facility.”
Unlike most state agencies, Corrections has no control over how many people it must serve, and the facilities must operate all day, year-round, she said.
Money to pay for collective bargaining agreements across all agencies will be partially paid for by an $86.5 million “salary pot” set aside last year as contract negotiations were wrapping up. Human Services also needs to pay for $11 million in collective bargaining costs with in-home care and service providers, who aren’t state employees.
The “salary pot” is expected to cover 80 to 90 percent of the added costs from collective bargaining agreements, said Ken Rocco, legislative fiscal officer.
Legislators will likely begin to make key budget decisions halfway through the five-week session after the next revenue forecast Feb. 12.
“I think the biggest wild card is the forecast,” Rocco said. “That’s, of course, out of our hands.”