Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the State Budget topic
No spam. Unsubscribe anytime.
Deschutes County officials say state revenue forecast and federal Medicaid changes threaten program funding
Summary
County leaders and state legislators on a Deschutes County conference call said the latest state revenue forecast is lower than expected and warned potential federal changes to Medicaid eligibility could reduce incoming federal dollars, squeezing funding for county services such as community corrections, behavioral health and wildfire response.
The Deschutes County Board of Commissioners and invited state legislators discussed the state revenue forecast and its likely effects on county services during a Tuesday conference call.
County staff described a forecast downgrade and federal Medicaid policy proposals that could reduce funds arriving in Oregon. "The revenue forecast is down compared to the last forecast. The official number that they quoted was $755,000,000," a county staff member summarized, adding that roughly $250 million of that figure had been pre-allocated for wildfires and that, in practical terms, the forecast shows about a $500 million decline relative to prior expectations.
Why it matters: County leaders said reduced state revenue and possible federal changes to Medicaid could force the state to re-prioritize spending and leave less general-fund support for programs counties deliver. "They're even more concerned about this potential reduction in the money that the state gets from Medicaid," the county staff member said.
State Senator Mike McLean, a member of the Ways and Means and revenue committees, told commissioners that despite the revision the state remains larger than in previous decades. "We have twice as much as we had 10 years ago," he said, noting that the new forecast was close to last December's numbers even if lower than March's.
Legislators and county leaders listed three primary budget pressures: a one-time "kicker" (estimated at roughly $1.6 billion) that the state must return to taxpayers unless voters or a two-thirds legislative vote change its use; potential loss of federal Medicaid funding if eligibility or allowable uses are restricted; and planned salary increases for state employees. Together, those items could consume billions and leave less discretionary money for other programs.
Commissioners said the pressure is already affecting conversations about funding for community corrections, behavioral health, workforce development and wildfire response. County leaders worried that a narrower legislative reconciliation package and the use of special purpose appropriations (SPAs) could leave counties uncertain about long-term program support.
"They may put that money into what they call a special purpose appropriation or a SPA and then let the eBoard come back and make funding decisions down the road," the county staff member said, warning that reliance on SPA allocations would increase uncertainty for county services.
Officials urged targeted outreach to Ways and Means members to emphasize that several county programs reduce downstream costs if maintained. The county requested short, one-page reminder letters summarizing local priorities and offered to deliver them to relevant legislators.
Local context and next steps: Participants said the Ways and Means committee may set aside money for later allocation by the Emergency Board, a move that would defer final decisions into interim periods and create uncertainty for county planning. Commissioners asked staff to coordinate brief, focused advocacy materials for key subcommittee chairs and co-chairs.
Ending: County staff and legislators agreed to keep communication channels open over the next several weeks while budget decisions firm up and to follow up with short written summaries for Ways and Means members.
