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Senator Chris Telfer: Ways to Reduce State Spending

by In the news Tuesday, August 31. 2010

Senator Chris Telfer: Ways to Reduce State SpendingSenator Chris Telfer Proposes Ways to Reduce State Spending
By Oregon State Senator Chris Telfer,

Salem, OR – Last week state officials revised their revenue projections and they are down, again. Since the close of the 2009 Legislative Session revenue projections have fallen by more than $1.2 billion. Senator Chris Telfer (R-Bend) is proposing several ways that lawmakers can reduce state spending and balance the budget.“As legislators it is our job to balance the state budget,” said Telfer. “Letting the Governor cut across-the-board is irresponsible.” As he did in June, the Governor is ordering an 8 percent cut to every program regardless of its value to Oregonians. Telfer is asking lawmakers to meet in Salem to discuss a list of targeted budget reductions that will preserve the most vital state programs. “From this point forward our budget must be focused on creating private sector jobs,” said Telfer. “Without them we will not get Oregon’s budget back on track. Washington D.C. cannot print money fast enough to bail us out. We must step up and fix this problem here. Most of the items on the list below require lawmakers to meet. They cannot be enacted by the Governor or the Legislative Emergency Board alone.

Proposals include:
Transform Government

- The Department of Human Services continues to lead the way in transforming the way services are delivered. Of the more than 100 recommendations for improvement 31 have been implemented saving more than $80 million. The department should be encouraged to keep moving with implementation of the remaining ideas and other state agencies must follow their lead.

- Review all federal funds to see if Oregon’s required match is worth spending. The strings attached to federal funds may be greater than the benefit of spending Oregon tax dollars.

Reduce the cost of Government

- Examine all new spending in the 2009-11 budget. Any reductions should start there. We have requested the information on this spending but based on the way the state drafts a budget we have been told the information will take weeks to put together.

- Remove all General Fund money from the Department of Land Conservation and Development. Any functions the department can no longer afford can be handled at the local level by those with a vested interest in the economic health of the area. This would save about $7 million for the remainder of the 2009-11 biennium.

- With three of four General Fund dollars going to employee salaries and benefits (according to the Governor’s Reset Report) we cannot balance the general fund budget without shared sacrifice. Options for reductions in employee costs include:

- Approximately 3,000 new positions have been created in state government since 2007 (excludes higher education). By eliminating those positions the state could save $160 million in the current biennium. If public employee union leaders are not willing to open contracts to deal with health insurance and/or PERS the state will have no choice but to reduce the number of state employees. Where possible, any of these reductions should be focused on positions that do not provide a direct service to Oregonians.

- Ask employees to pay for just half of the 6% of salary the state currently pays to their PERS accounts. For the remainder of the current biennium this would save approximately $53 million. This change was recommended by the Governor’s Reset Cabinet.

- Halt the practice of granting salary rate reclassifications to state employees which are really just a backdoor way to avoid the pay freeze. (A list of reclassifications this biennium has been requested).

- Ask state employees to pay for part of their health insurance. If state employees paid what the average teacher does ($187 per month) that state could save over $71 million for the remainder of this biennium.

- Do not fill any positions currently vacant without the approval of the Governor.

- Suspend any Business Energy Tax Credits tax credits not yet approved. This could save approximately $80 million.

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Posted by at 01:57 | Posted in Measure 37 | 24 Comments |Email This Post Email This Post |Print This Post Print This Post
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  • Steve Plunk

    May I add reduce services. The diminishing returns on investment are reason enough to reduce the services themselves. Government can’t fill every need so a rational decision concerning what can be filled with the budget constraints makes sense. Too often state managers look at all the needs and work toward finding the revenue to fill them rather than look at the revenue and see what needs can be met. That’s a big difference and one we should recognize.

    • Cathy Kaech

      Chris Telfer is a fiscal conservative. She was a fiscal conservative before she ran for office. I use to live in Bend and often she was a lone voice, asking for her fellow city commissioners to come to a place of responsibility and common sense. ( This didn’t happen until it was too late in Bend. Or)

      We need her and her understanding of our grave financial perfect storm.

      • Anonymous

        I wonder, did she oppose the absurdly wasteful I mean high-cost Bend branch campus of OSU/UO?

    • Anonymous

      Speaking of reducing services, perhaps the state could close Southern Oregon University, or at least reduce the special subsidy it gets (in comparison with the more viable campuses)? When you look at the cost per degree actually earned, SOU (along with several other small campuses) is way higher than UO, OSU. Perhaps it’s a luxury we can no longer afford.

      • Steve Plunk

        Perhaps it is. I wonder if they would even study the possibility? I would advocate the closing of Rogue Community College before SOU. If a region is looking to attract business a college like SOU helps more than a community college.

        • eagle eye

          I believe they talk about it from time to time, partly as a means to siphon money off from the bigger campuses. But it will never happen, too much local opposition. The “rural” legislators.

          As for closing Rogue CC, won’t happen either. But you are on to something. As noted elsewhere, the CC’s spend more per student than the 4-year colleges and universities, even though they only have year 1 and 2 programs. Plus, their public subsidy is huge compared to the 4-years, by a factor of 2 or 3 (when you count the local property tax contributions).

          The state could simply eliminate subsidies for the public universities, essentially making them private. Probably some of them would sink into oblivion. The others would charge much higher tuition than they do now to the in-state students, essentially, private school tuition.

          A good idea? It depends on who you ask.

  • Jim Ray

    Chris my Dear, if you are CPA I’m sure you would agree that if you had a private client that had a future financial “obligation” such as an upside down mortgage you would advise bankruptcy if there wasn’t any way of paying all of their past due and mounting bills.

    The State of Oregon is Bankrupt! NO amount of cute budget cutting, spending cuts, service reductions, etc. will be enough to withstand the PERS onslaught. You lose my vote as well as others if you don’t wake up!

    • eagle eye

      Wrong! The state is not bankrupt. With all the PERS stuff, it’s perhaps 15% in the hole for the next biennium and 10% long term (according to the figures Chris Dudley is using).

      So no, the state is not bankrupt, it has a budget problem.

      Besides, there is the little fact that there is no provision for a state going bankrupt. A good lawyer, and probably a CPA, could tell you that.

      • Jim Ray

        Ok fine, let’s call it “Receivership” instead of “Bankruptcy”.

        • eagle eye

          That would basically be dissolving the state and going to the federal government for protection and a takeover. There is not much precedent for that. You and I don’t want to go there. You really want the Obama administration running the remains of the state of Oregon? You sure they won’t immediately order a tax increase of say, 50% ?

          In any case, it’s totally unnecessary. The state is not bankrupt. The deficit is big, but managemable. If Oregon did run to the feds, the best thing for the feds to do would be to tell Oregon to get lost, go solve your own problems. The federal government has enough on its hands as it is.

          • Jim Ray

            Sorry Eagle Eye but “Receivership” does not mean the Feds are the “referee”. You suggested earlier that “A good lawyer, and probably a CPA, could tell you that.” OK fine, did that and was reminded about “Receivership” being the process and the Feds would not get involved.

            Explain to me your theory that Oregon is not “bankrupt” in that the PERS obligation alone (future) far outstrips revenue.

            You are trying to make chicken salad out of chicken shit!

          • eagle eye

            If state “receivership” is not going to the federal government, basically throwing the state at their mercy and control, pray tell what is it? What provision is there for it in any legal framework?

            And no, Oregon is not bankrupt. According to figures Dudley is using, the state general funds deficit is about 15% for the next biennium. About 10% after. That is hardly “bankruptcy”.

            And I tracked this down from the Aug. 21 page with a picture of Dudley and Kitzhaber. Bottom line: the problem is not insurmountably big, and most of it isn’t even due to state worker payroll costs.

            You’ll notice that nobody outside the fringe is talking about “bankruptcy” or “receivership”.

            Less to Dudley’s plan than meets the eye, but some illuminating stuff there.

            First, the long-term general funds deficit is only about 10% of the general funds budget (see p. 2 of the plan). Others have come up with this number too; it seems to be right about on target. Not the stuff of the “state bankruptcy” that some of the more eager hate-government types keep lusting for.

            Second, of the long-term deficit (p. 3), only about a third is made up of “payroll costs”. So problems with “payroll costs” amount to a little more than 3% of the general funds budget. That’s interesting in light of the constant screaming about public worker “bloodsuckers” causing the destruction of Oregon. The rest of the deficit is due to increased demand for human services, debt service, etc.

            Third, if Dudley ever actually comes up with details on how he will fill the budget gap — programs, savings with numbers adding up to the $2.25 billion or so long-term biennial deficit — it’s hard to find. He has his 26 points, but when all is said and done, they don’t add up to a hill of bean-counting!

            Dudley should hope Kitzhaber’s staff doesn’t see this too.
            #4 eagle eye’s optometrist! on 2010-08-21 11:20

            ( Reply)
            Interesting, doc, good work. But do you expect them to care about real numbers? The other stuff is too much fun.

            I wonder if Dudley has figured out what you figured out?
            #4.1 eagle eye on 2010-08-21 12:19 ( Reply)

          • Jim Ray

            You’ll notice that nobody outside the fringe is talking about “bankruptcy” or “receivership”.

            Yes I’ve noticed that nobody on this post has mentioned either, however, I don’t believe that anyone is getting any info from the “inside”. Certainly you cannot be so naive EE as to trust any numbers from Dudley, Hell, he’s a Babe in the political woods with no one on his staff on the “inside”. Info I obtain comes from within. Enough said…

  • Anonymous

    In Oregon the only answer the bureaucrats ever have is to raise taxes. So, let’s just raise taxes on everyone so the protected government class can keep their cushy jobs and fat benefits. Let’s double the income tax rates, add a sales tax, double taxes on energy, abolish the mortgage interest deduction, eliminate limits on property taxes, tax every newborn child, tax every person for breathing and raise taxes on everything else (vehicle registrations, boats, professional registrations, building permits, etc). This way government will be sure to have all the money it needs. The only problem may be that there will be no private sector left to pay for the government in Oregon.

    Thank God for Texas!

  • Bob Clark

    I think Senator Tefler is running for state Treasurer. This sure beats what her opponent Wheeler is offering . I would add cutting the Milwaukee light rail contribution by the tune of $250 million. This project is a boondoggle which only puts TriMet deeper in deficit, and causes cuts in (lower cost) bus service.

  • eagle eye

    “If public employee union leaders are not willing to open contracts to deal with health insurance and/or PERS the state will have no choice but to reduce the number of state employees.”

    I wonder what Rep. Telfer has in mind to offer the union workers in return for the things she proposes to “ask” for? Does she think saying “pretty please” will do the trick? Or is this negotiation to be completely one-sided? That rarely works. The last time we did that successfully was in 1945.

    Perhaps the kicker will be on the table?

    • Barry

      Don’t state union workers have enough already?

      • eagle eye

        I think if you ask them, they’ll say if they have enough, so do the corporations, in spades. Especially if you are “asking” them to take significant pay cuts (which is what reductions in PERS contributions, reductions in insurance benefits amount to.)

    • Steve Plunk

      Higher taxes have historically resulted in higher spending. Taking away the kicker will not likely solve anything in the long run.

  • Anonymous

    the problem with all the proposals for making state workers “pay” is that it is all smoke and mirrors. the unions can smile and nod and wink and say “sure, we’ll kick in our 6% for PERS and we’ll make all the members pay $187 each month for medical.” then guess what? they’ll just write an across the board 10% salary hike into the contract – saying it is an overdue cost of living adjustment that is only “fair” after making so many sacrifices. want to bet the end result will be we pay union workers MORE? but then they can point and say “look, we TOOK the hit on PERS and we TOOK the hit on medical” and all the sheeple will bleat along.

    you want to save the budget in Oregon? how about reverting K-12, which has been a miserable failure at any price, back to 2005-2007 budget levels? how about eliminating all non-mandatory services from Medicaid? how about ODOT stops building pedestrian bridges, bike lanes, high speed bus lines and light rail?

    you want to increase revenue? how about cutting all the senseless regulation and bureaucracy so that businesses will actually grow and prosper, so that new businesses will actually want to come TO Oregon?

    we need radical change, not parlor tricks.

    • eagle eye

      It’s called “negotiation”. It takes two to agree to a contract.

      It’s amusing when people like you call for the state to make absurd cuts — though I didn’t see you mention state law enforcement and prisons from your proposals — but you imagine that the state being firm in a negotiation is beyond human possibility.

      It’s kind of like the class coward who is always fantasizing about beating up the class bully or football star, but who runs away whenever a minor fight breaks out.

      • Steve Plunk

        Eagle, Just because people don’t call for the cuts you might advocate doesn’t make them cowards. If you want to insult everyone I guess that’s a way to do it.

        Personally I would agree that prisons should be releasing nonviolent offenders and reducing costs. State law enforcement costs aren’t all that much so I see that as a non issue.

        The state has failed in labor negotiations and it’s all because they have had no incentives to be firm. A growing economy always gave them the resources needed to meet the union demands. Until now.

        The fact is everything needs to be looked at in new ways and with an open mind.

        • eagle eye

          I didn’t start the insults. Plenty of stuff there being thrown at lots of people by “Anonymous”. If he/she wants to throw it, I don’t feel bad about calling him a coward, call it a personal insult if you like, but Anonymous is not even very personal.

          What is cowardly is not the areas of the cuts, but their absurdity, especially taking K-12 back to 2005 levels. OK, run on that platform, start the “Gut K-12 Party”. It’s not the Republican platform (they seem to want to protect K-12 at all costs), nor the Democrats’ platform.

          What is cowardly is coming up with extreme ideas — like gutting K-12, or treating teachers like “hot dog vendors” (another great idea here), or declaring state “bankruptcy”, whatever that means.

          When a modest amount of sense and a modest amount of spine would have avoided the current problems.

          And still would, in fact.

          By the way, I’m glad that you apparently agree that the kicker “needs to be looked at in new ways and with an open mind.”

  • Ron Glynn

    I understand that Christ Telfer is a CPA, with long experience, and a State Senator plus was a Bend City Councilwoman for 5 years. Wow! A person actually qualified for the position of State Treasurer. Gee, I wonder who I would vote for in November?

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