How They Will Come For Your Kicker

The Kicker is a strange, yet beautiful mechanism that makes the Oregon tax system very unique. Should the State of Oregon happen to take in tax receipts more than 2% over projected revenues, then the excess money is “kicked” back to the taxpayers in the form of a tax rebate.  I love the Kicker because it reinforces the philosophical idea that your money belongs to you and not to the government.

Well this month marks two years since the Democrats in Oregon last attempted to take the Kicker away from taxpayers, and I fear we may see a repeat performance.

Buzz is already starting over whether the Kicker will “kick” this session.  As unemployment reaches lower levels and Oregon’s economy keeps improving, the chances of undershooting tax revenues is more and more of a possibility.  The Register-Guard has already put out a story speculating on the possibility.  Should the May Revenue forecast low-ball the number, we will see a whole new element introduced into our budget discussions.

So Oregon is having a big discussion over how to address the 1.7 Billion dollars necessary to maintain current services levels as well as pay for the new programs voted in by ballot measure back in 2016.  It is very likely that we will see some sort of “Grand Bargain” that includes a combination of tax increase and spending cuts being pitched to the legislature.  I would not be surprised to the the withholding of the Kicker on the chopping block as well.

As it so happens the Chief Sponsor of the bill to withhold your Kicker checks back in 2015 is none other than our new State Treasurer Tobias Read.  2015’s HB 3555 would have increased the projected revenues, thus eliminating last sessions Kick in order to direct half of that money towards the rainy day fund, and the other half to the general fund marked for education purposes.  By now though I think we are familiar with the shell game the legislature tends to play with dollars marked for certain things.  General fund money is fungible after all.

Kicking money back to the taxpayers when you’re facing close to a 1.7 billion dollar budget hole seems pretty silly right? That is why our current situation make for the perfect storm for efforts to eliminate the Kicker.  Think about it, the kicker for this session gets withheld in some giant tax/spending cuts reform proposal, then an effort is lead by our new State Treasurer to refer the elimination of the Kicker to the voters.  2012’s Measure 85 which eliminated the Corporate Kicker, already gives the big government crowd the blueprint on how to run it.  The money will be allocated to rainy day funds and to schools of course, which even I would be for if I actually trusted the Oregon Legislature to spend my tax dollars.
Do we need a more robust rainy day fund? Absolutely! Do schools need more money? Definitely! But I fear the elimination of the Kicker would cede philosophical ground to those who desire to keep feeding the behemoth of ever growing government.

  • While I agree about the taxpayer protection offered by the Kicker, I would suggest that the “schools” don’t need more money. Classrooms may, but the public school system with all its administrative overhead is already spending over $12,502 per ADM student as of 2014-15 according to the NEA annual report on 50 state spending. Portland Public Schools are already spending well over 15,000 per student.

  • Bob Clark

    Next Tuesday’s Portland Public Schools bond measure public vote might tell us something about the mood of the electorate to approve massive spending programs in the face of underlying dysfunctional local and state government performance. Sounds like there’s maybe a fair chance the measure might fail, or it passes maybe by just a narrow margin (and this one is thought by many to be “for the children”).

  • klatu

    Privatize as much of government as possible. The death spiral of PERs, unlimited government growth, and unsustainable public wages and benefits cannot be supported by the private sector forever.