other opinions monday

Oregon’s twin kickers:

Dumb, dumber refunds

The Oregon economy is alive and kicking, but if this state sends back more than a billion dollars in taxes next year instead of saving some of it for a rainy day, it will be time to declare the state’s political leadership brain-dead.

By preparing to give corporate and individual taxpayers the largest combined “kicker” in history – estimated Thursday at nearly $1.1 billion – Oregon is signaling that it learned nothing from the economic crisis that hammered this state just four years ago.

Oregon remains as vulnerable to an economic downturn and revenue collapse as it was then. Its weakened public schools are even more exposed to the early closures and other radical spending cuts that were a national embarrassment.

Forty-four states are now deciding what to do with higher-than-expected 2006 tax revenues. In most of them, legislators and governors either are replenishing rainy day funds or investing the money into critical services such as schools, universities and community colleges to further strengthen their economies.

North Carolina has a billion-dollar surplus and is increasing spending on K-12 education by 13 percent. Maryland is putting another $262 million into education. Hawaii is renovating 95 school buildings at a cost of $235 million. California is putting a whopping $2 billion more into schools.

Oregon, meanwhile, is preparing to give nearly $200 million back to mostly out-of-state corporations, and ship another $883 million back to individual taxpayers. Never mind that it has the sixth fastest-growing economy in the country.

The kicker is widely misunderstood by taxpayers. The law requires refunds when state revenues exceed economic forecasts. It is not a matter of “surplus” taxes.

No other state has such a dumb, fiscally destructive law.

Twice in the past 25 years Oregon plunged into recession and faced the hellish choice of either raising taxes at the worst time or slashing away at its core services, including the very schools and universities it needs to prosper.

The leaders of this state ought to leap at a once-in-a-generation chance to create a real rainy day fund. Yes, it involves sacrifice. Yes, it is politically unpopular. Yet twice burned, Oregonians ought to know this by now: You can have a kicker, or you can keep Oregon schools open in the next recession.

The Oregonian, Portland

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