Oregon Budget Forecast Cut by Up to $755 Million

Oregon's revised economic forecast projects a $500–$755 million shortfall in available funds for the 2025-27 budget cycle, largely due to an economic slowdown and ongoing federal policy and tariff uncertainty. Lawmakers now expect to have about $37.4 billion to allocate, which is less than the governor's proposal but exceeds the current biennium's budget. The Office of Economic Analysis has downgraded its national growth outlook for 2025 from 2% to 0.8%, with a 25% chance of recession but no recession currently forecast. Democrats attribute the revenue decline to federal policy turbulence, while Republicans point to state tax and regulatory measures. Governor Tina Kotek has committed to prioritizing affordable housing and homelessness prevention in budget decisions. The state legislature has approximately six weeks remaining in its session to adjust the budget in response to the lower forecast.