Oregon Public Broadcasting

The budget picture in Oregon just keeps getting worse. State economists announced Thursday that projected revenues dropped another $377 million in the past three months.

That comes on the heels of a half-billion dollar drop in May.

Oregon senior economist Josh Harwood told lawmakers that Oregon isn't alone in facing severe budget challenges. But he says the state relies heavily on the income tax, and that makes Oregon's budget more volatile than many other states'.

Josh Hardwood: "Forty states have budget shortfalls, but the magnitude that we're seeing here on your budget, because your source is the one particular one that's doing the worst, nationally, is greater."

Majority Democrats including Governor Ted Kulongoski immediately announced a plan that they say will lessen the impact of the newest shortfall.

They say they'll use a combination of federal funds and state reserve funds to offset cuts to education, public safety and some human services programs.

Nonetheless, the governor is telling other state agencies to prepare for another round of across-the-board cuts, the second this summer.

Online:

Oregon Revenue Forecast