PERSPECTIVE FROM THE 19^TH HOLE:  This is the title I chose for my personal blog, which is meant to give me an outlet for one of my favorite crafts – writing – plus to use an image from my favorite sport, golf.  Out of college, my first job was as a reporter for the Daily Astorian in Astoria, Oregon, and I went on from there to practice writing in all of my professional positions, including as press secretary in Washington, D.C. for a Democrat Congressman from Oregon (Les AuCoin), as an Oregon state government manager in Salem and Portland, as press secretary for Oregon’s last Republican governor (Vic Atiyeh), and as a private sector lobbyist.  This blog also allows me to link another favorite pastime – politics and the art of developing public policy – to what I write.  I could have called this blog “Middle Ground,” for that is what I long for in both politics and golf.  The middle ground is often where the best public policy decisions lie.  And it is where you want to be on a golf course.

The headline in this blog uses a word — “kicker” – that has come to describe an important debate in the Oregon Legislature.

It is this:  When citizens pay taxes, are those monies theirs, or do they become state government property?

It is possible, objectively, to argue both points of view.

For what it’s worth, I was involved in various “kicker” debates over the years when I worked at the Capitol for state government agencies, and later as a lobbyist. 

So, in the first place, what’s the “kicker”?

The term refers to a reality in Oregon law:  When Oregon tax revenues (minus corporate income taxes) exceed the forecast made at the start of the two-year budget cycle by 2 per cent or more, all the extra revenue must be returned to taxpayers.

The corporate kicker works the same way, but the surplus, by state law, goes to schools.

The “kicker” law was passed by the Oregon Legislature in 1979 and, a year later, was approved by the state’s voters in a special election.

The law always has been controversial.  Some in the Legislature want to retain the money and use it to fund what they consider to be important government programs.  Others say the money belongs to taxpayers and, thus, should be returned.

According to the latest state government revenue forecast, which was released last week, Oregon is on track to bring in an additional $1 billion in tax revenues this budget cycle.  Thus, if left in place, a “kicker” tax rebate could reach about $1.4 billion, a record of sorts for “kicker” revenue.

The word “stunning” appears in the headline on this blog because a dramatic rebound from the down forecast one year ago caught state leaders by surprise, though they welcomed the good news.

The Oregonian newspaper wrote this:  “Today’s forecast is stunning,” said House Speaker Tina Kotek. “A year ago, the world was in a free fall.  Oregon’s decisions and investments in the face of converging crises have started an incredibly strong recovery.”

Senate Republicans proclaimed, “Oregon is swimming in money.”  Senate President Peter Courtney described the forecast as “unbelievable.”

What sparked the turnaround?

For one thing, federal aid poured into Oregon in the form of higher-than-usual unemployment benefits for almost anyone out of a job due to the pandemic, even if they weren’t seeking other work.  Further, assistance for renters, business owners, health care providers and that other groups helped lead to the strong economic performance.

That infusion of dollars tended to offset business losses during the pandemic, though many businesses are beginning to recover as, overall at least, the pandemic recedes.

With just six weeks left in the two-year budget cycle that ends in June, lawmakers aren’t expected to spend more than a trickle of the “new” money in the current budget.  Several political leaders have spoken about the importance of focusing on one-time spending items rather than establishing new, ongoing commitments, as they acknowledge the uncertainty around future revenues.

At the moment, Oregon taxpayers would receive their share of the “kicker” as a credit against their 2021 taxes when they file next spring. The size of the rebate would be based on how much tax they paid the state when they filed their 2020 taxes this year.

So, one question is, will the “kicker” kick?

The answer is almost certainly yes.

There is not time in the current legislative session to do anything else.  Plus, doing something else is a huge political lift.

But, as has been proposed in the past on occasion, a possible compromise down the road could be to propose placing the “kicker” revenue in dedicated funds that would be saved for the future, not spent as they arrive.  Voters might accept such a change.

Then, when the economy turns sour, as inevitably will happen sometime in the future, legislators would have sources of money to use to cushion the blow.

Whenever such a proposal is considered, if it is considered at all, it would take high-level negotiations to resolve the continuing tension – who’s money is it, the government’s or individual taxpayer’s?