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Can Governor’s Plans Weather Economic Storms?

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Monday, March 24, 2008   

Portland, OR – Gov. Ted Kulongoski has laid out his vision for health care, education and economic growth in his State of the State address. One of his priorities is building Oregon's "rainy day" fund to prepare for tough economic times. To do that, he's calling for a boost in the state's corporate minimum tax.

Chuck Sheketoff, executive director of the Oregon Center for Public Policy, agrees. He says the current corporate minimum tax is embarrassingly low.

"The corporate minimum is a black eye on the business community of Oregon. The governor is appropriately saying we need to raise it, we need to make sure that education of our children and the health of our most vulnerable citizens are never again sacrificed on the altar of tough economic times."

He says the current rainy day fund, designed to get the state through an economic downturn, is not enough to do that, even with a corporate minimum tax increase.

Some state business groups say the increase would be too much of a burden. Sheketoff, however, says the 77-year-old minimum tax is obsolete and needs to be brought into the 21st century.

In order to pay for the governor's priorities, the state needs to re-think its tax system, Sheketoff suggests, to make sure the wealthiest Oregonians and businesses pay their fair share.

"What we need is a more progressive taxation system than is currently in place, and we need to revamp the corporate tax, not just raise the minimum, but make corporations like Intel into good taxpayers again."

The governor also focused on education from pre-kindergarten through college, with plans to bring all eligible children into Head Start programs, reduce class sizes in schools and improve college financial aid.

Larry Wolf, president of the Oregon Education Association, believes the support exists to make those education plans a reality in the next legislative session.

"We saw, in the last legislative session, education really being a top priority of not only the governor but the legislature and the citizens of this state. I hope we can move closer to fully funding the quality education model."

In the governor's annual address to the legislature, Kulongoski also called for more use of alternative energy and for health care for all Oregon children.





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