Alan R.P. Journet Ph.D.
Cofacilitator
Southern Oregon Climate Action Now
February 4^th 2026

Chair Nathanson and members of the House Committee on Revenue:

I write as cofacilitator of Southern Oregon Climate Action Now (SOCAN), the oldest grassroots climate organization in the Rogue Valley now representing some 2,000 Southern Oregonians who are concerned about the climate crisis and seek federal, state and local action to address it. We are rural and coastal Southern Oregonians who live on the frontlines of the warming, reducing snowpack, heatwaves, drought, rising sea level and the increasing wildfire risk that these trends conspire to impose on us. Because of our concern, we pay close attention to efforts nationally, statewide, and locally that impact our collective efforts to address the climate crisis. As our logo above indicates, the focus of SOCAN is to promote action through science while encouraging that this be undertaken through a social justice lens.

Biennium after biennium, the state of Oregon seems inordinately often to find itself short of treasury funds. According to DOR (2025): “The 1979 Oregon Legislative Assembly passed the “Two percent kicker” law as a way to control state spending.” As a result of this law, the state compares the state economist’s revenue forecast for a biennium with the actual receipts and returns to the taxpayers any surplus received over that forecast if the difference exceeds 2% Walczak (2017). As a result of a ballot measure in 2000, this was added to the Constitution and thus requires a Constitutional amendment to be removed. The Office of Economic Analysis (OEA) certified that revenue for the 2023-2025 biennium exceeded the income forecast by that same OEA by $1.41 billion. As a result, Oregon taxpayers can expect to receive a kicker representing 9.863% of their 2024 tax liability.

According to OSBA (2025), state economist Carl Riccadonna revised the estimated 2025-2027 biennium revenue upwards by nearly $310 million.  However, he also warned that “uncertainty over tariffs and missing data from the federal shutdown means they have less confidence than usual in their economic predictions.’ Unsurprisingly, the Trump / Republican tariff shenanigans are playing havoc with our state’s budgetary planning. Notably, the provision of this kicker does not relate to actual state expenditures, so a kicker can be activated even when expenditures exceed revenue, thus dropping the state into a financial deficit. If the state’s economy is thriving, yet the revenue estimate failed to predict it, the kicker’s activation can unreasonably compromise the state budget. As Walczak (2017) pointed out that “When designed properly, tax triggers can be a responsible way to implement meaningful tax reform. Poorly designed tax limitation programs like the kicker, however, can exacerbate shortfalls and put pressure on lawmakers to impose new taxes to cover the lost revenue.” As Hauser (2026) pointed out in testifying on HB 4125: “Oregon’s current budgeting process is unrealistic, resting entirely on a single revenue estimate. It asks the state economist to carry out a near-impossible task: to predict the global, national, and state economy over the course of a two-year period, and then translate that into a precise revenue estimate.” A problem arises if the economists developing the forecast fail to predict an unpredictable event, such as a pandemic, inflation, or, indeed, tariffs.

The problem that Oregon has experienced in funding emergencies is exacerbated by a Trump Administration that back in early 2025, for example, froze federal disaster relief despite court orders blocking the act of freezing funds (Bourgeois 2025). There is no evidence that the federal government will behave any more responsibly in the future, potentially leaving the state further mired in financial chaos.

Eleven states and the District of Columbia have established ‘tax triggers’ as a means of stimulating tax rate reductions (Walczak 2016). Oregon’s kicker, however, is a little different since it does nothing about tax rates but merely uses the ‘trigger’ to stimulate a return of revenue to taxpayers. Of course, not all taxpayers receive the same refund. Rather, the refund is a percentage of the tax paid in the previous year. Inevitably, this means the largest taxpayers, those who are most wealthy, reap the greatest reward from such a system.

Over the last decade, the kicker has cost the state Treasury almost $11 billion dollars (OCPP 2026). Notably, 62% of this has accrued to the benefit of the wealthiest 20% of Oregonians. Clearly, the Oregon kicker is a boondoggle designed to benefit the wealthy, screw the Treasury and through that target state programs and indirectly undermine the lives of low- and middle-income Oregonians. Frankly, the Oregon Kicker looks like another boondoggle to benefit the wealthy at the expense of average Oregonians.

Apparently, the state is in no better shape than are one third of Oregonians, who “couldn’t afford a $400 emergency expense without borrowing money or going into debt.…”(FOX 2025).

It seems entirely appropriate that HB4125 should allocate funds to a ‘One-Time Emergencies and Finance Fund.’ Further, it is appropriate that these funds should be designated to cover expenses incurred in relation to the Public Employees Retirement System, the cost of capital projects that would otherwise require revenue bonds, the payment of debt service, and expenses related to emergencies.

The evidence suggests that the mechanism employed in Oregon for computing and allocating the kicker is in need of adjustment. In this vein, Hauser (2026) concluded that: “HB 4125 provides an excellent way to improve Oregon’s budgeting process while recognizing the constitutional demands of balancing a budget.”

For these reasons, Southern Oregon Climate Action Now concurs with Hauser (2026) in supporting HB4125

Respectfully Submit

Alan Journet Ph.D.

7113 Griffin Lane

Jacksonville
OR 97530-9342

alan@socan.eco
541-500-2331
541-301-4107

Sources Cited

Bourgeois M. 2025. Oregon joins legal effort forcing Trump admin to unfreeze FEMA funds. KOIN 6 https://www.koin.com/news/oregon/oregon-joins-legal-effort-forcing-trump-admin-to-unfreeze-fema-funds/

DOR 2025 Fact Sheet: Oregon’s Surplus Revenue “Kicker” Credit. Oregon Department of Revenue. https://ap.ps.oregon.gov/oregon-newsroom/OR/DOR/Posts/Post/Fact-Sheet-Oregons-Surplus-Revenue-Kicker-Credit

FOX 2025. One third of Oregonians can’t afford a $400 emergency. FOX 12 Oregon. https://www.kptv.com/2025/10/21/one-third-oregonians-cant-afford-400-emergency/?fbclid=IwY2xjawPwvNFleHRuA2FlbQIxMABicmlkETFRa1VWSHZZRXJXRUpheFhZc3J0YwZhcHBfaWQQMjIyMDM5MTc4ODIwMDg5MgABHowBAyhplAaiPh2euj0wOkNTGSDT1s4O-kb3m_TmU9wbMnH2Qbhv5xSSnNpe_aem_mFFedpUCsAZElmLFvXYfFA

Hauser D. 2026. HB 4125: Stabilize Oregon’s Budget. Oregon Center for Public Policy. https://www.ocpp.org/2026/02/02/hb-4125-stabilize-oregons-budget/

OSBA 2025. Revenue report gives Oregon some breathing room. Oregon State Boards Association. https://www.osba.org/revenue-report-gives-oregon-some-breathing-room/

Walczak J 2016 Designing Tax Triggers: Lessons from the States. Tax Foundation. https://taxfoundation.org/research/all/state/designing-tax-triggers-lessons-states/ Walczak J 2017. Oregon’s “Kicker” Kicks the State While It’s Down. Tax Foundation https://taxfoundation.org/blog/oregon-kicker-tax-refund/