$1B shortfall could derail business projects - Portland Business Journal:

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l , which revealed its $635 million biennia budget request justthis week, may need to adjustr its attempts to add another 160,000 residents to the healtyh insurance rolls. l could take another look at plane to askfor $26 million to back its brand of sustainability industry businesxs models. l Manufacturing 21, which hopes to regenerate Oregon’sz industrial muscle, may need to either forgo or look elsewhere foran $18 million jobs training and transitionn package.
The only comfort is that all sectors schools, public safety and social services in particular that rely on state funding are as nervous as businesxs advocates whofear they’ll see few economid development dollars through 2011. “Everybodu is moving into panic mode in termd of watching the availability of state saidNorm Eder, Manufacturing 21’s executive director. “State resources for economiv stimulus programs havedeclined precipitously. This could be the tip of the iceberg.” Added Ben the state’s treasurer-elect, “When you get into a storjm of this magnitude, everybody in the boat’s going to get Businesses could faceother challenges.
For , which provides services for youths and personsdwith disabilities, relies on publicx funding for nearly 87 percent of its $32 million budget. Any deficits must be filled throughuprivate donations, said Bart McMullen, president of . “Therr are a lot of places like Albertina Kerr and likesafeth net-type clinics that will be said McMullen, an Albertina Kerr board “And that puts the squeeze on too.” The anxiety was unleashed this week after economistse warned that the state could have $1 billiomn less to spend than in 2007. The tensiohn will build until Dec. 1, when Gov. Ted Kulongosku releases his proposed budget.
“Ww have to be carefull where to squeeze,” said Andy president and CEO of the andHealth “It’s important to do this thoughtfully.” The good news for businesds is that Senate President Peter Courtney wantsd to forge ahead with plans to issure as much as $1.6 billion in bond dedicated to enhancing various state infrastructure including roads and bridges. The money would providew the statewith 38,000 jobs, he The pledge comes as welcome news to Georgre Pernsteiner, chancellor of the . He’s spoke n with Kulongoski about enhancingthe schools’ buildings and othe r infrastructure needs.
“It would get a lot of constructionb jobs going quickly and help ourcapital budgets,” Pernsteinet said. However, Pernsteiner and many others who anxiously awaitedthe Nov. 19 revenuse forecast were mostly glum. Thos e relying on appropriations must now wait to see what Kulongosk proposes inhis 2009-1 1 budget. The numbers handed down by statew economists Tom Potiowsky and Josh Harwood landedx lower thanthe $2 billion shortfall some revenue analystsd had predicted this fall. Potiowsky said the actual general fund shortfalkis $718 million, with the number expectefd to grow to $1 billionb once new expenditures are added to the equation. Courtneyu said the number coulc evenreach $1.
4 billion when the next legislative sessionh starts in January. Sen. Bruce a Hillsboro Republican, said projections made during the 2001-03 slowdown indicats that the state’s shortfall numberzs eventually double from their original projectionswduring recessions. “We’re saying it’s about a $1 billionh change now from what we over the end of the2007 session, when Oregon’ s economy seemed strong, said Starr. “Basex on our experiences then, I expect it to be aboutf $1 billion more.
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