State Fiscal Briefs

April 2023

Oregon’s budget basics

According to the National Association of State Budget Officers (NASBO), Oregon’s total expenditures in fiscal year (FY) 2022 were $67.8 billion, including general funds, other state funds, bonds, and federal funds. NASBO reported that total expenditures across all states in FY 2022 were $2.9 trillion, ranging from $5.6 billion in Wyoming to $510.0 billion in California.

Each state allocates spending and taxes differently among different levels of governments, and local governments often administer programs with state funds, so combined state and local government data show a more complete picture of individual benefits and contributions when comparing states.

Per the US Census Bureau, Oregon’s combined state and local direct general expenditures were $54.7 billion in FY 2020 (the most recent year census data were available), or $12,902 per capita. (Census data exclude “business-like” activities such as utilities and transfers between state and local governments.) National per capita direct general expenditures were $10,540.

(Note: We cite data from both NASBO and Census to provide a broader picture of each state’s fiscal situation. However, these sources detail spending from different levels of government in different years, and the COVID-19 pandemic and the federal government’s response to it significantly affected these totals in different ways in different years. Please only use one source if you are looking for historical comparisons.)

Oregon’s largest spending areas per capita were public welfare ($3,091) and elementary and secondary education ($2,296). The Census Bureau includes most Medicaid spending in public welfare but also allocates some of it to public hospitals. Per capita spending is useful for state comparisons but is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.

Oregon’s combined state and local general revenues were $51.4 billion in FY 2020, or $12,109 per capita. National per capita general revenues were $10,933. Oregon does not levy a general sales tax. After federal transfers, Oregon’s largest sources of per capita revenue were charges ($2,459), such as state university tuition and highway tolls, and individual income taxes ($2,036).

Oregon’s politics

Governor Tina Kotek, a Democrat, was elected in 2022 with 47 percent of the vote. The next gubernatorial election is in 2026.

Democrats control both the House of Representatives (35 Democrats to 25 Republicans) and Senate (17 Democrats to 11 Republicans and 1 independent). Control of the governor’s mansion and each house of the legislature gives Democrats a trifecta in Oregon. All Oregon House seats are on the ballot in 2024 because representatives serve two-year terms. Senators serve four-year terms; roughly half the senatorial seats are on the ballot in 2024, and the other half will be up for election in 2026.

Oregon’s budget institutions, rules, and constraints

Oregon uses a biennial budget. The legislature must pass a balanced budget, but it can carry a deficit over into the following year. Oregon further limits both spending and revenue growth with a budget rule based on personal income growth. The rules are binding and require a legislative supermajority or vote of the people to override them. The state also requires a three-fifths supermajority to pass bills that increase tax rates. The state does not have any limits on debt service or authorized debt.

Oregon also uses a unique budget rule known in the state as “the kicker.” When the state’s actual revenue collections are 2 percent or more above the official revenue forecast for the two-year budget cycle, the excess revenue is returned to Oregon taxpayers as a tax credit on resident’s state income tax (thus, the size of the rebate depends on the filer’s income). There are separate kickers for individual income tax revenue and corporate income tax revenue. Oregon voters approved the kicker in a 1980 ballot initiative.

For example, in 2019 the state’s tax collections unexpectedly soared and ended up $1.6 billion above the 2 percent kicker line. As a result, the median Oregon taxpayer will get a tax credit worth $346 on their tax year 2019 state income tax. Higher earners will get tax rebates worth thousands of dollars when they file next year.

(Note: Some states have informal budget institutions that constrain overall spending growth or a specific expenditure’s growth.)

Oregon’s current budget

Governor Kotek released her FY 2024-2025 biennial budget proposal in January 2023. She has not yet given her state of the state address.

Oregon enacted its supplemental FY 2022-2023 biennial budget in April 2022. The enacted budget included $121.2 billion in total fund spending and $27.9 billion in general fund spending over the two-year period. Oregon also passed tax cuts in both calendar years 2021 and 2022, including sending one-time tax rebates to filers eligible for the state’s earned income tax credit in 2022.

Under the American Rescue Plan, Oregon will receive $2.6 billion in direct state fiscal aid and $1.3 billion in local government aid from the federal government. As of January 2022, Oregon had spent part of its ARP funds on public safety, capital construction, health, and economic development.

According to NASBO, Oregon’s recent expenditure totals (general fund spending/total spending, including federal transfers) were:

  • FY 2022: $19.0 billion/$67.8 billion
  • FY 2021: $16.4 billion/$66.8 billion
  • FY 2020: $18.9 billion/$55.0 billion
  • FY 2019: $9.6 billion/$42.6 billion

For more on Oregon’s budget, see