| Press Release |
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| March 16, 2007 |
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Governor Kulongoski Signs Historic Rainy Day Fund into Law
Will create stability for critical public services during future economic downturns
Salem –Today Governor Ted Kulongoski signed into law historic legislation establishing a general fund rainy day fund. Oregon was one of six states without a general fund rainy day fund, but with the Education Stability Fund and the bills signed into law today, Oregon will now have full protection for education, human services and public safety funding during future economic downturns.
"Today we have built a roof over our heads and when the next economic storm comes, we'll be ready," the Governor said at a signing ceremony for House Bills 2707 and 2031. "We will continue to provide vital services, and we will have fulfilled our most solemn obligation as elected officials to the protect health, safety and future of the people of Oregon."
Attending the ceremony were Senate President Peter Courtney (D-Salem), House Speaker Jeff Merkley (D-Portland), Representative Bruce Hanna (R-Roseburg), a bi-partisan group of legislators, and business leaders from throughout the state who worked to pass the legislation.
"Last week, we had an opportunity to put aside our differences, and focus on our common goal: to create stability for our critical public services and more fairness in our tax system. And we did so with great success," the Governor said. "After more than four years of advocating that we put enough reserves aside to keep our state strong during the worst of times - we are on our way to meet that goal."
The two bills, House Bill 2707 and House Bill 2031, will establish a reserve fund to cover future revenue shortfalls. Specifically, the bills:
- Retain an estimated $290.3 million of the anticipated 2007 corporate income tax kicker to finance the reserve fund;
- Require the ending balance of the General Fund (up to 1% of General Fund appropriations) to be placed in the fund, an estimated $138.4 million this biennium;
- Provide $24.8 million in tax rebates to small businesses with less than $5 million in Oregon sales;
- Set strict economic criteria and require a three-fifths vote of the legislature to access the fund;
- Limit the amount that could be drawn from the fund in any biennium to two thirds of its total value;
- Designate that interest earned on the fund will be committed to the fund; and,
- Cap the size of the fund to 7.5% of the prior biennium's General Fund revenues.
The Governor closed the ceremony by congratulating the House and Senate legislative leaders for moving this bill quickly through the session as a bipartisan priority.
"Back in January, very few people - in the press or public - believed that we would be standing here, not as Democrats or Republicans, but as Oregonians moving our state forward on to more solid fiscal ground," said the Governor. "If there's something I want to leave the press and public with today, it"s that I believe today"s ceremony is symbolic of what is yet to come this legislative session."
Contact:
Anna Richter Taylor, 503.378.6169
Jake Weigler, 503.378.6496
Kristina Edmunson, 503.378.5040
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