The Office of Economic Analysis (OEA) presented the March Economic and Revenue Forecast to the House Committee on Finance and Revenue. Though the previous forecast back in the December featured information about a mild recession through unprecedented revenue growth and sizable reserves, the March forecast highlighted an even stronger outlook than expected. Combined resources for the 2021-23 and 2023-25 have increased by $696 million since the last forecast. Inflation is slowing, employment and income are higher than expected, and even though we may still expect a recession or economic slowdown, it may not be as dire as we once predicted.
In the words of OEA, “Either the economic storm clouds have parted, or we are in the eye of the hurricane."
Because of the continued, unprecedented growth above forecasted revenue, OEA predicts a personal kicker of $3.94 billion will be credited toward Oregonians in 2024, as well as a corporate kicker of $1.55 billion.
Despite the unexpected stability of the outlook, concerns remain about inflation and cost of living. Additionally, the legislature will have some very large fiscal asks this session, including money for the I-5 bridge and funds for the Governor’s housing and homelessness plan.
The next forecast will be May 17th, which will be the most significant indicator for how much money the state will have before they pass their budget.
Governor Kotek issued the following statement on the March forecast:
“As inflation continues to slow, this revenue forecast shows that we can anticipate having more predictability and stability for the coming budget cycle. While this is encouraging news, the legislature still has some tough choices to make. We will have to keep focused and stay the course in order to make much-needed investments in Oregonians’ most urgent shared priorities: housing and homelessness, behavioral health, and education.”