Oregon Gov. Ted Kulongoski this week called for a constitutional amendment that would force the state to save more in good years by directing part of its “kicker” tax rebates into an emergency reserve fund.

He made the proposal after Oregon voters approved $733 million of tax hikes to keep the state’s budget in balance during the current biennium and to stave off cuts in education and other services.

“Simply put, it’s time to say 'enough’ to budgeting from crisis to crisis —  'enough’ to additional tax increases — and 'enough’ to a lack of stability in our budgeting process,” said Kulongoski, a Democrat, who supported the tax increases. “To stop this roller-coaster budgeting, we must require the state to save more in good times so our children’s education is protected and we are not asking Oregonians to pay more in taxes in bad times.”

Oregon’s kicker law requires the state to rebate excess tax dollars to taxpayers when revenue exceeds forecasts by 2% or more in a biennium. Kulongoski said the state should direct as much as half of the kicker rebates into the emergency reserves to avoid boom-and-bust budgeting in the future.

He proposed that the state set a limit on the amount allowed to accumulate in the reserve, such as 10% of the previous biennium’s general fund budget. He also called for “strict rules” that would limit when the fund could be used and would prohibit lawmakers from using the entire fund in a single budget period.

The governor called on lawmakers to take up the issue during a special session planned for next month.

“This issue — kicker reform — is the single most important issue the legislature can address during the special session to help Oregon during this next decade and beyond,” Kulongoski said.

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