Oregon economic, revenue forecast shows near $1B kicker for 2026
PORTLAND, Ore. (KOIN) – The Oregon Economic and Revenue Forecast released Wednesday found Oregon's economy may be transitioning out of the pandemic lull and shows a near $1 billion kicker for taxpayers.
Oregon's Office of Economic Analysis, which prepared the forecast, explained “Over the entire cycle to date, Oregon’s economic performance has been solid. Employment gains, income growth, and population change are all roughly in the middle of the pack across all states, but a bit below the typical state."
According to the forecast, Oregon's General Gund for the current 2023-25 biennium increased by $676 million, or 2%, from the last forecast.
Two-thirds of the increase is from tracking tax collections alone. The other one-third is from a stronger revenue outlook for the rest of the biennium, OEA said.
This also means an increase in the projected kickers for that biennium. The personal kicker is now expected to reach $987 million for taxpayers in 2026 and $883 million for the corporate kicker, which will be retained in the General Fund and spent on education in the next biennium.
Looking ahead to the 2025-27 biennium, funding decreased by $66 million compared to the last forecast. Officials said the increase in corporate, estate, and interest earnings are not enough to offset the larger personal kicker being paid out. For 2025-27, the General Fund forecasts $610 million.
"In some ways it seems like Oregon is a bit out of sync in recent years. This is both in relation to the typical cyclical patterns, and relative performance across states or compared to the nation. Much of this is likely tied to the slowdown, or outright declines in the state’s population. Historically, migration is strongest among 20- and 30-somethings who move in search of a job, and then set down roots," the economic office said in the forecast.
The office added, "There are a few green shoots that Oregon’s relative growth may be picking up. Job gains, employment revisions, withholding tax collections, and the number of income tax returns filed so far this year all point toward the potential of stronger gains."
In a statement reacting to the projections, Oregon Gov. Tina Kotek said, "It is encouraging to see that our economy continues to be stable, with healthy workforce participation in key sectors. The forecast urges an emphasis on core programs and holding our ground on Oregonians’ top priorities.”
Oregon House Speaker Julie Fahey (D-Eugene) said "Today’s revenue forecast indicates that, statewide, Oregon’s economy is stable and growing. Inflation continues to slow, which is good news for our working families. Having a stable state budget will help us continue the critical investments we've made in Oregonians, like quality schools, affordable housing, and accessible health care. But we also need to remain prudent in how we use taxpayer dollars and stay focused on passing a transportation package next year that will keep our economy moving.”
Oregon Senate Republican Leader Daniel Bonham (R-The Dalles) encouraged the legislature to show restraint on spending.
“This forecast is another clear warning that we must exercise fiscal restraint,” Bonham said. “Oregon families are already feeling the squeeze from high costs, and it's imperative that we don't add to their burden by overspending.”