Oregon Economic and Revenue Forecast

September 2013

Volume XXXIII, No. 3 Release Date: August 28, 2013

Michael Jordan John A. Kitzhaber, MD Prepared By: Chief Operating Officer Governor Office of Economic Analysis DAS Director Department of Administrative Services

2

SPECIAL ANNOUNCEMENT: Download the Economic and Revenue Forecast from the web

The Office of Economic Analysis will post all forecasts online at http://www.oregon.gov/DAS/OEA/pages/economic.aspx#most_recent_forecast

To receive an email notice of new postings, please sign up at the following web site: http://www.oregon.gov/DAS/OEA/pages/listserv.aspx

Department of Administrative Services

Michael Jordan DAS Director

Chief Operating Officer

Office of Economic Analysis

Mark McMullen, State Economist Josh Lehner, Senior Economist

Kanhaiya Vaidya, Senior Demographer Michael Kennedy, Senior Economist

André Harboe, Economist Kris Klemm, Administrative Specialist

http://oregon.gov/DAS/OEA/

http://oregoneconomicanalysis.wordpress.com/ http://twitter.com/OR_EconAnalysis

3

Foreword This document contains the Oregon economic and revenue forecasts. The Oregon economic forecast is published to provide information to planners and policy makers in state agencies and private organizations for use in their decision making processes. The Oregon revenue forecast is published to open the revenue forecasting process to public review. It is the basis for much of the budgeting in state government. The report is issued four times a year; in March, June, September, and December. The economic model assumptions and results are reviewed by the Department of Administrative Services Economic Advisory Committee and by the Governor's Council of Economic Advisors. The Department of Administrative Services Economic Advisory Committee consists of 15 economists employed by state agencies, while the Governor's Council of Economic Advisors is a group of 12 economists from academia, finance, utilities, and industry. Members of the Economic Advisory Committee and the Governor's Council of Economic Advisors provide a two-way flow of information. The Department of Administrative Services makes preliminary forecasts and receives feedback on the reasonableness of such forecasts and assumptions employed. After the discussion of the preliminary forecast, the Department of Administrative Services makes a final forecast using the suggestions and comments made by the two reviewing committees. The results from the economic model are in turn used to provide a preliminary forecast for state tax revenues. The preliminary results are reviewed by the Council of Revenue Forecast Advisors. The Council of Revenue Forecast Advisors consists of 15 specialists with backgrounds in accounting, financial planning, and economics. Members bring specific specialties in tax issues and represent private practices, accounting firms, corporations, government (Oregon Department of Revenue and Legislative Revenue Office), and the Governor’s Council of Economic Advisors. After discussion of the preliminary revenue forecast, the Department of Administrative Services makes the final revenue forecast using the suggestions and comments made by the reviewing committee. Readers who have questions or wish to submit suggestions may contact the Office of Economic Analysis by telephone at 503-378-3405.

Michael Jordan DAS Director Chief Operating Officer

4

Table of Contents EXECUTIVE SUMMARY .…………………………………………….……...…….…….....……………. 5

ECONOMIC OUTLOOK ………………………………………………………………….………………. 6 U.S. Economy ………………………………………………………………..….…………………… 6

Oregon Economy ………………………………………………………………...…………………. 9

Oregon Labor Market ……………………………………………….……………..………............. 10

Leading Indicators ………………………………………………………………..…………………. 11

Short-term Outlook …………………………………………………………………..………………. 12

Forecast Risks …………………………………………………………………..………….............. 14

Alternative Scenarios …………………………………………………………..…………………… 15

Extended Outlook ………………………………………………………………..………………….. 16

Exports …………………………………………………………………..……………………………. 17

Regional Trends ………………………………………………..……………………………………. 19

State Comparisons ……………………………………………..…………………………………… 22

REVENUE OUTLOOK …………………………………………………………………………… 23

General Fund Revenues, 2013-15 ………………………..………………………………………. 23

Extended Outlook ………………………………………..………………………………………….. 26

Tax Law Assumptions …………………………………..…………………………………............. 27

Alternative Scenarios ……………………………………..………………………………………… 27

Lottery Outlook …………………………………………..………………………………….............. 28

Budgetary Reserves …………………………………..…………………………..……….............. 30

APPENDIX A: ECONOMIC ……………………………………………………………………… 31

APPENDIX B: REVENUE ……………………………………………………………………...... 39

APPENDIX C: DEMOGRAPHIC ………….…………………………………………………..... 54

5

Executive Summary

September 2013

First, the good news: the economic recovery persists, with recent upward revisions to both output and job growth suggesting that the domestic economy remains on solid footing. Now, the bad news: growth continues to be lackluster, below historical averages and just strong enough to keep the economy moving in the right direction.

Much like the nation, Oregon’s economy continues to improve, however, unlike the U.S., Oregon’s private sector employment has accelerated in recent months. Since the labor market recovery began, Oregon’s private sector jobs have been expanding at a rate just under 2 percent. Since the end of 2012, private employment growth has improved to approximately 2.5 percent. This increase is largely due to improving economies in regions of the state outside of the Portland metropolitan area. Portland’s employment growth has remained steady, while the rest of the state, in particular the hardest hit areas of Bend and Medford, have stabilized and even begun adding jobs in the past year.

The recent acceleration in employment is expected to hold steady over the next two years before longer-run demographic trends weigh on growth. There is the potential for a temporary slowdown this fall as the tax law changes and sequester cuts impact underlying economic activity with a delay. However expectations overall are solidifying and our baseline economic outlook remains effectively unchanged. Furthermore, many forecasters are turning their attention more toward the quality of the recovery and the types of jobs being added and focusing less on probability of recession, which is considered lower today than a year ago.

In keeping with the stable economic outlook, expectations for General Fund revenue growth have remained largely unchanged as well. Along with underlying job growth, personal income taxes paid out of labor income are expected to accelerate somewhat during the 2013-15 biennium. Healthy income tax collections during July and August suggest that tax revenues are following this script for now. Although improved, overall revenue growth is expected to remain modest from an historical perspective. Personal income taxes based on investment income will grow slowly in the near term since many Oregonians cashed out gains in 2012 in anticipation of federal tax rate increases. Tax revenue growth is expected to fall in between the rates Oregon has become accustomed to during past periods of economic expansion, and the slow gains we have seen in recent years.

Although the outlook for the 2013-15 biennium remains on track, the final weeks of the 2011-13 biennium were a disappointment. A backlog of personal and corporate income tax refund payments were processed and issued shortly after the May forecast was released. As a result, the 2013-15 beginning balance is now expected to be smaller than it was at that time. Technical factors related to borrowing costs and the fact there was no corporate tax kicker in 2011-13 help to offset this lower beginning balance.

In terms of the major General Fund components, a modest improvement in the outlook for personal income taxes is offset by an expected decline in corporate tax collections. All other General Fund revenues are raised slightly due to a stronger outlook in estate taxes. Furthermore, the lottery outlook is raised slightly as stronger traditional sales, particularly in jackpot games, offset a minor reduction in the video lottery sales outlook.

The combination of these items is a decline of $37 million in total available resources for the 2013-15 biennium. The outlook for 2015-17 is raised $5 million and, on net, the 2017-19 revenue outlook is unchanged.

(Millions)2013 COS Forecast

September 2013 Forecast

Change from COS Forecast

Structural RevenuesPersonal Income Tax $13,558.2 $13,603.5 $45.3

Corporate Income Tax $1,056.6 $1,012.0 -$44.5

All Other Revenues $1,027.9 $1,032.7 $4.8

Gross GF Revenues $15,642.6 $15,648.2 $5.6

Offsets and Transfers -$120.8 -$100.3 $20.6

Administrative Actions -$18.2 -$13.6 $4.7

Legislative Actions -$136.9 -$136.9 $0.0

Net Available Resources $15,910.1 $15,870.4 -$39.7

Confidence Intervals67% Confidence +/- 9.0% $1,405.095% Confidence +/- 18.0% $2,810.0

2013-15 General Fund Forecast Summary

6

ECONOMIC OUTLOOK

U.S. Economic Summary

First, the good news: the U.S. economic recovery persists, with recent upward revisions to both output and job growth suggesting that the domestic economy remains on solid footing. Now, the bad news: growth continues to be lackluster, below historical averages and just strong enough to keep the economy moving in the right direction.

As has been the case for the past two years there remain two primary risks to the near-term economic outlook: contractionary public policies and weakness among our major trading partners. Policy risks include both federal spending cuts/tax increases as well as the pace of monetary tightening.

Despite the obvious risks, sentiment is improving among businesses, consumers and economists, with most in agreement that the durability, or sustainability, of the recovery is becoming less and less a question with each passing quarter. Although strong growth may not be around the corner, fears of a renewed recession have waned considerably.

The baseline outlook for the U.S. calls for a continuation of the recovery, with growth accelerating slightly in 2014. U.S. employment growth is projected to pick-up to around 220,000 jobs per month by 2015 as private sector growth strengthens and the public sector continues to turn from an economic drag to a more neutral, even positive, position. In Oregon, expectations are for this growth to be even stronger as private sector employment has already accelerated from sub-2 percent to 2.5 percent in recent months.

U.S. Economic Detail

In July, the U.S. Bureau of Economic Analysis released a comprehensive revision to the National Income and Product Accounts going back to 1929. The BEA’s revisions now incorporate some methodological changes, including the classification of research and development, and also the creation of original works such as movies, as business investment. Following the revisions and the release of the Q2 GDP figures the recovery in the U.S. now appears stronger than previously thought. Even so, growth rates have still been lackluster and below historical averages.

A similar, and familiar, pattern can also be seen in the labor market. Job growth has consistently been between 1.5 and 2.0 percent year-over-year or approximately 186,000 jobs per month since the beginning of 2012. Each of the past two years employment has been revised upward by the U.S. Bureau of Labor Statistics and early indications are that 2013 will be as well. Even so, job growth remains weak compared with previous expansions and is only strong enough to bring the unemployment rate down slowly. Over the past two years the unemployment rate has fallen from 9.0 percent in July 2011 to 7.4 percent in July 2013, which represents a decline of less than one-tenth of one percent per month, on average.

Even with this steady improvement in joblessness, wage gains have been elusive for many workers. Nationally, average hourly earnings have been increasing at a 2% pace since 2010 and recent research by the Federal Reserve Bank of San Francisco shows that approximately 15% of all workers received no wage increases in recent years, the largest share on record going back to 1986. Making these meager gains even smaller, inflation has averaged 2% in recent years, meaning real wages have not increased for the average worker.

Given these subpar trends, one might expect businesses and consumers to remain pessimistic about the economic outlook. However, this has not been the case. Small business optimism, while not fully recovered, is at its highest point since the

-6%

-4%

-2%

0%

2%

4%

Jan-07 Jan-09 Jan-11 Jan-13

Consistent, Steady and Lackluster Growth Avg Hourly Earnings Employment

7

recession began. Consumer sentiment is also at its highest level since prior to the recession and consumer spending continues to chug along at a rate of approximately 2 percent per year. Based on the latest Wall Street Journal Economic Forecasting Survey from August 2013, economists have lowered their odds of a recession happening during the next year to 15 percent. The economists in the survey now view the upside and downside risks to the outlook as being balanced. Similarly, IHS Global Insight, our office’s macroeconomic vendor, places the probability of recession at 20 percent.

Why is sentiment improving? The short answer continues to be the nascent rebound in housing and improvement in household balance sheets. Home prices are rising at double-digit rates based on the S&P/Case-Shiller Home Price Index and in the high single-digits based on the FHFA Home Price Index. Such gains are a boon to homeowners. As asset prices rise, wealth does too. Arguably more important in recent years, has been the decrease in homeowners with negative equity. According to Zillow, in the first quarter of 2013 approximately 25 percent of all homeowners owed more on their mortgages than their homes were worth. While still a large figure, it is down from over 31 percent at the end of 2011. This means that about 2.7 million homeowners who were previously underwater, now have positive equity over the past 15 months. This freedom from negative equity means these households are in much stronger financial positions and have more flexibility moving forward in terms of consumer spending and also refinancing or selling their home and relocating, if needed.

In addition to the positive effects of rising home values on household balance sheets, the country and the state have also seen a strong increase in construction activity. The momentum in the housing market may be stalling in recent months – potentially as a response to rising interest rates – however housing starts in July in the U.S. totaled an annualized 896,000 compared with 741,000 a year prior. Permits for new activity are also showing strong over-the-year gains in 2013. These levels of current and future activity are effectively double their recessionary lows. However, they still remain considerably below the historical average of 1.5 million seen before the housing boom and bust. This indicates that the housing expansion has room for further improvement and stronger growth from the sector is likely in the coming few years.

Even with the consistent growth seen in recent years and the combined bright spot of the improving household balance sheets, risks remain to the near-term outlook. In particular, both fiscal and monetary policies threaten to mute the private sector recovery seen thus far.

First, federal fiscal policy remains an economic drag due to tax law enacted at the beginning of the year in addition to the sequester that was officially put in place in March. These cuts are impacting both the private and public sectors and are beginning to appear in the economic data.

-1.5

-1.1

-0.7

-0.4

0.0

0.4

0.8

1.1

1.5

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Jan-10 Jan-11 Jan-12 Jan-13

As Rates Rise, Will New Activity Stall? 6 month change

Housing Starts New Home Sales

Mortgage Rate, bp change

80

100

120

140

160

180

Jan-10 Jan-11 Jan-12 Jan-13

Closed Sales Index, 2010 Average = 100 U.S. Portland MSA

8

In terms of direct federal employment, reductions have accelerated in recent months from around 1,200 per month at the Department of Defense in 2012 to 2,500 per month from April through June of this year. At other federal agencies this acceleration has been stronger, increasing from reductions of 1,600 per month in 2012 to 5,100 per month from April through June. Additionally, furloughs of the federal workforce are reducing hours worked and labor income for employees.

Sequester impacts in the private sector are harder to identify given the broad array of goods and services purchased by the federal government. However one important aspect to keep an eye on is businesses and industries that rely on federal contracts. Given that one-half of the sequester cuts were to be defense related, tracking military dependent industries does provide insight into the sequester’s impact on the private sector. As shown in the top graph on the right, since the threat of sequester became real at the end of 2012 – that is, expectations changed from the political belief that it would be delayed or replaced to actually being enacted – military dependent industries1 have stagnated in terms of employment. On a regional basis, as seen in the map, Oregon does not have a large reliance on these specific industries, however our neighbors certainly do. The direct impact of the sequestration may be somewhat muted here in Oregon, however to the extent that the U.S. economy slows down, it is expected that Oregon would too as the state’s business cycles do match the national trends.

The second primary policy risk to the near-term economic outlook remains monetary policy. The Federal Reserve has indicated that it will likely begin tapering its quantitative easing policies by the end of 2013, and begin raising the federal funds rate when the unemployment rate reaches 6.5 percent. These announcements, either explicit or based on reading the meeting minutes, have acted as a shot across the bow of financial markets and longer term interest rates have risen in recent months. The increases are seen in corporate borrowing costs, mortgage rates and government bonds. To the extent that increased borrowing costs slow down new investment by firms or curtail the improving housing market due to higher costs, it will certainly have a negative impact on the economy and act as a headwind. If, however, these higher rates are more a reflection on a stronger economy and increased activity, then they should be welcomed and not feared. New, incoming economic data in the months ahead will be very important to gauge when monetary policy will change.

1 For more information on military dependent industries and the sequester’s impact, please see our recent blog post:

http://oregoneconomicanalysis.wordpress.com/2013/08/07/the-sequester-impact/

+86bp

+102bp +69bp

+69bp

0

1

2

3

4

5

6

Governement, 10 Yr

Mortgage, 30 Yr

Corporate AAA Corporate BAA

Borrowing Costs Are Rising Dec-12 Jul-13

9

Oregon Economy

Much like the nation, Oregon’s economy continues to improve with each passing month. However, the rate of improvement remains subpar when compared with historical periods of expansion. Unlike the U.S., however, Oregon’s private sector employment has accelerated in recent months. Since the labor market recovery began, Oregon’s private sector jobs have been expanding at a rate just under 2 percent. Growth averaged 1.75 percent in 2011 and 2012. Since the end of 2012, however, private employment growth has improved to approximately 2.5 percent. This increase is largely due to improving economies in regions of the state outside of the Portland metropolitan area, as discussed in more detail in the regional section of the forecast (pg 19). Portland’s employment growth has remained steady, while the rest of the state, in particular the hardest hit areas of Bend and Medford, have stabilized and even begun adding jobs in the past year.

This improvement in the labor market largely matches the timing of our office’s economic forecasts in the past year. Expectations were that at the end of 2012 or in early 2013 the employment picture would brighten as the two main economic drags in the recovery lessen and even turn to positives. These two drags being the housing market and state and local governments. New construction and housing activity continues to grow briskly, as

discussed previously, while state and local governments have stabilized their employment in the past year. The outlook remains positive for both of these industries in Oregon.

Permits for new construction in Oregon are currently growing at double-digit rates for both single family and multi-family projects, and home prices in all of the metropolitan areas in the state are increasing above the rate of inflation on a year-over-year basis according to the FHFA estimates for the second quarter. Bend is once again the leader in the housing market with 16 percent appreciation, however prices in Central Oregon still remain 36 percent below peak levels, or the same as in 2004.

On the public sector outlook, expectations are for stable employment in the coming months. There remains the potential for one more round of layoffs in local education – K-12 in particular – this coming school year, however that will not be known for two more months. Non-education employment for the state, counties and cities has stabilized and is projected to grow along with the overall population in the next few years.

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13

Oregon Private Sector Employment

16.7%

8.2% 7.1% 7.0%

5.5% 4.8% 4.6% 4.6% 4.2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Bend Portland Oregon Medford Grants Pass

Albany Eugene Corvallis Salem

Home Price Gains in Oregon, 2013 Q2

0

500

1,000

1,500

2,000

2,500

3,000

Jan-90 Jan-94 Jan-98 Jan-02 Jan-06 Jan-10

Oregon Housing Permits (Monthly, SA 3 MMA)

Total Permits Single Family

10

Oregon Labor Market

The Office of Economic Analysis examines four main sources for jobs data: the monthly payroll employment survey, the monthly household survey, monthly withholding tax receipts and the quarterly census of employment and wages. Right now all four measures of the labor market are showing steady improvements with jobs being added, wages increasing and the unemployment rate declining, albeit are slower rates than customarily occurring at similar points in previous business cycles. Currently, wages in Oregon are increasing at approximately 4 percent per year, while in the previous expansion the gains were 6 percent per year and in the 1990s the gains were 8 percent per year.

The most recent job growth rankings, published by Arizona State University’s W.P. Carey School of Business, places Oregon 19th in the nation for job growth in July. Over the past year the state has added 29,300 jobs, or an increase of 1.8 percent. Private sector growth has been even stronger and the total employment gains are being held down by public sector cuts. A year ago, Oregon ranked 28th fastest with growth of just 1.2 percent.

Overall, getting a handle of the health of Oregon’s labor market is being somewhat complicated by technical issues within the underlying payroll jobs data. For this reason the employment data in our office’s forecast is adjusted for two important technical purposes: seasonality at the detailed industry level and the upcoming benchmark revisions2.

In the second quarter, total nonfarm employment increased 1.7 percent over the past year with the private sector growing at nearly 2.5 percent and the public sector falling 1.3 percent. The graph on the following page illustrates both the number of job gains by major industry by the length of the bar and the percentage increase these changes represent. Green industries expanded at a faster rate than total employment, while yellow industries increased a rate slower than average and red

2 Each year the U.S. Bureau of Labor Statistics revise the employment data – a process known as benchmarking. The

current establishment survey (CES), also known as the monthly payroll survey, is benchmarked against the quarterly census of employment and wages (QCEW), a series that contains all employees covered by unemployment insurance. The monthly CES is based on a sample of firms, whereas the QCEW contains approximately 96 percent of all employees, or nearly a complete count of employment in Oregon. The greatest benefit of the CES is the timeliness – monthly employment estimates are available with only a one month lag – and these estimates are reasonably accurate. However the further removed from the latest benchmark, the larger the errors. The QCEW is less timely as the data is released publically approximately 3-4 months following the end of the quarter. The greatest benefit of the QCEW is that is a near 100 percent count of statewide employment. For these reasons, the CES is usually used to discuss recent monthly employment trends, however once a year the data is revised to match the historical QCEW employment trends. The last month of official benchmark data is September 2012. The QCEW is currently available through March 2013, thus the preliminary benchmark used here covers the October 2012 – March 2013 period.

Nonfarm Job Growth by StateJuly 2013 over July2012

(Ranked by Percent Change)

Source: Blue Chip Job Growth Update, W.P. Carey School of Business, Arizona State University

Bottom 10 Middle 10Fourth 10 Second 10 Top 10

Oregon: 19th

-8% -6% -4% -2% 0% 2% 4% 6% 8%

10% 12%

1998Q1 2001Q1 2004Q1 2007Q1 2010Q1 2013Q1

Oregon Wage Growth 4 Qtr Rolling Average, Y/Y

BEA Wages Withholding

11

indicates outright job losses.

Overall employment gains in both the number of jobs, and as a percentage increase, were led by the leisure & hospitality and professional and business services industries. These two industries accounted for 56 percent of the job gains in the past year and both industries have fully regained all of their recessionary losses. One important item to note is that despite the conventional wisdom, not all of these jobs are low-paying, particularly in the professional and business services. In fact, among these professional jobs 47 percent of the gains in recent years have been in subsectors that pay more than $52,000 per year, while 45 percent are in low-paying subsectors – less than $30,000 per year – with the remaining 8 percent of job gains being between $35,000 and $50,000 per year, on average. For more information on these professional jobs, please see our office’s recent blog post3.

Other industries that are currently growing at above average rates are the majority of our goods producing ones: natural resources, construction and durable goods manufacturing. In particular natural resources and manufacturing have not been engines of growth in recent decades in both Oregon and the nation, however today they are. This is both a reflection of the depths of the recessionary losses and of the fact that the initial phase of economic recovery has largely been led by business investment and exports. Seeing increases in the number of loggers and production workers is encouraging, with construction workers now being added as activity increases. New home construction has now rebounded to the point where builders need to hire additional workers and the average hours worked in the industry has effectively returned to pre-recession levels.

For additional information on the most recent quarter’s employment forecast errors, please refer to Table A.1 in Appendix A.

Leading Indicators

In June both the Oregon-specific leading indicator series pointed toward continued growth in the local economy, as did the U.S. leading index published by the Federal Reserve Bank of Philadelphia. Sustained improvement in the majority of the individual indicators in all three series bodes well for employment gains in the coming six months.

Our office’s Oregon Index of Leading Indicators (OILI) has 8 out of the 11 indicators positive on a six month basis. The three negative indicators

3 http://oregoneconomicanalysis.wordpress.com/2013/07/25/professional-jobs/

2.8%

2.5%

2.9%

1.1%

1.4%

0.7%

2.7%

0.7%

2.3%

3.2%

0.7%

1.6%

5.8%

0.5%

-1.3%

-6,000 -3,000 0 3,000 6,000 9,000

Natural Resources

Construction

Durable Goods

Nondurable Goods

Retail

Wholesale

T/W/U

Information

Financial

Professional & Business

Education Services

Health Services

Leisure & Hospitality

Other Services

Public Sector

Oregon Employment Growth 2013 Q2 over 2012 Q2

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

-15%

-10%

-5%

0%

5%

10%

Jan-97 Jan-01 Jan-05 Jan-09 Jan-13

Leading Indicators Recession Probability (Right) OILI UO Index US Leading Index

12

are the Oregon Dollar Index, withholdings and new incorporations. The Oregon Dollar Index continues to appreciate as global growth, particularly in the emerging markets, slows leaving the U.S. as the brightest economic spot in a dim-lit global field and strengthening our currency. As expected, as a currency appreciates, exports slow and both the U.S. and Oregon exports are growing less briskly than a year ago. For more on Oregon exports please see page 17 of this report. Applications for new incorporations as the Oregon Secretary of State’s office continue to be lackluster and overall entrepreneurship and business formation in the U.S. are at suppressed levels. In the near-term this may not be too worrisome for employment gains however from a longer-run economic development perspective, increased business formation is an important aspect of economic growth. If these figures, both in Oregon and the U.S., do not improve it could weight on future growth. Lastly, withholdings out of paychecks are largely growing in line with subpar employment gains, however they are pushed around month to month by calendar issues – such is the case in June.

Both new housing permits and air freight tonnage have slowed in recent months; however remain positive on a six month basis. All other indicators show continued improvements in Oregon in recent years. The University of Oregon Index of Economic Indicators currently shows stronger growth with only one indicator slowing down – new orders for nondefense capital goods – which may be influenced some by the federal sequester and global slowing. One minor difference is that the UO Index smoothes housing permits over 5 months so the most recent loss of momentum has not reached the index to the same extent as in OILI.

At the national level the Federal Reserve Bank of Philadelphia’s leading index incorporates many of the same variables, in particular housing permits, new claims for unemployment insurance, the Institute of Supply Management survey and the interest rate spread. These indicators similarly point toward continued expansion for the U.S. Furthermore the most recent probability of recession4, calculated in real time by University of Oregon professor Jeremy Piger, is just 0.9 percent in May for the U.S. and 0.0 percent for Oregon.

Short-term Outlook

The recent acceleration of private sector employment growth in Oregon is expected to hold steady over the next two years before longer-run demographic trends weigh on growth. There is the potential for a temporary slowdown in growth this fall as sequester cuts hit harder, however expectations are even if this is the case, for growth to strengthen as the cuts diminish over time. Public sector layoffs are projected to stop by the end of the year with only modest gains thereafter, approximately in-line with population growth. While this represents stronger job growth than in the recent past, the unemployment rate will still decline slowly and it is not until 2015 that the unemployment rate will fall below 7 percent in Oregon.

Along with an improving labor market, stronger personal income gains will come. 2013 personal income is projected to increase at just a 2 percent pace, however, this largely reflects the pull-forward of investment-type income into 2012 due to the fiscal cliff. Personal income is expected to increase by 5 percent in 2014 and 5.1 percent in 2015.

As the economy continues to improve it will help drive up demand for new houses as household formation increases. Household formation has remained suppressed as individuals and families turned to rental markets and doubled-up during the recession. As these individuals find work in an improving economy, their desire to live on their own or away from their parents will lead to increased housing demand.

4 http://pages.uoregon.edu/jpiger/us_recession_probs.htm/

Sustained ImprovementContinued, Choppy GrowthSlowing or Slight DeclineNo Improvement

OILI (OEA)Industrial ProductionInitial Unemployment ClaimsHelp Wanted AdsBook-To-Bill RatioConsumer SentimentPurchasing Mangers IndexWithholdingAir Freight TonnageHousing PermitsOregon Dollar IndexNew Incorporations

Univ Oregon IndexHousing PermitsInitial Unemployment ClaimsManufacturing Hrs WorkedConsumer SentimentEmployment ServicesInterest Rate SpreadWeight Distance TaxCapital Goods Orders

Individual Indicators

13

Housing starts today in Oregon total nearly 15,000 at an annualized rate, which represents growth of over 80 percent from the recessionary lows of 2009 and 2010. A level of about 21,000 is the long-run average for the state prior to the housing bubble, and the forecast calls for strong growth in the coming few years with starts reaching 16,500 in 2014 and 19,800 in 2015. Over the extended horizon, starts are expected to average a little more than 23,000 per year to meet demand for a larger population and also, partially, to catch-up for the underbuilding that has occurred in recent years. As of today, new home construction is cumulatively about one year behind the stable growth levels of prior decades even after accounting for the overbuilding during the boom.

Forecast Changes Relative to the Previous Outlook

Overall the outlook has no fundamental changes as the May outlook is tracking the recent data fairly well. Personal income overall is lowered approximately 1 percent in 2013 due to revised estimates by the Bureau of Economic Analysis. These revisions were concentrated in wages and salaries. While this revision is carried forward throughout the forecast, the impact on the numbers lessens over time due to a slightly stronger employment picture in 2013, 2014 and 2015. These forecast changes are concentrated in the private sector as recent public sector figures in early 2013 were below forecast. Within the private sector all major industries have been revised upward except for manufacturing, where the downward revisions are most pronounced in the high technology and transportation equipment subsectors. Both of these industries are projected to add jobs in the next two years; however the growth has been lowered relative to three months ago. Furthermore both the unemployment rate and housing starts have been improving quicker than the previous outlook. The unemployment rate is two-tenths of one percent lower than projected, although it is not entirely certain this is for “good” reasons as the number of individuals looking for work has declined, helping drive the decline. Housing starts continue to grow faster than projections, however the longer-run picture remains the same.

A more complete summary of the Oregon economic outlook and forecast changes relative to the previous outlook – our office’s previous Table O.3 and O.4 – are available as Table A.2 and A.3 in Appendix A.

Forecast Comparison

Besides the Oregon Office of Economic Analysis, there are a number of other economic forecasters who produce an Oregon outlook. A comparison of these forecasts is provided below for employment growth and personal income growth. Arizona State University compiles these outlooks as part of the Western Blue Chip5, with the exception being IHS Global Insight.

Overall, each forecast expects the economic expansion to continue, with relatively slow rates of growth in 2013 before seeing improvement in 2014. The range of employment estimates for this year is tight – ranging from 1.6 to

5 http://wpcarey.asu.edu/bluechip/western/oregon.cfm

Economic Forecast Summary

2013:1 2013:2 2013:3 2013:4 2014:1 2012 2013 2014 2015 2016

Personal Income, Nominal U.S. (4.7) 4.2 3.7 4.6 6.5 3.7 2.8 4.9 4.9 5.0% change Oregon (4.5) 4.1 3.7 4.5 6.7 4.0 2.0 5.0 5.1 5.4Wages and Salaries, Nominal U.S. (1.0) 2.9 4.0 4.0 4.8 3.7 3.3 4.4 4.8 4.7% change Oregon 0.7 3.1 3.8 3.0 5.0 3.9 2.0 4.2 5.0 5.0Population U.S. 0.8 0.8 0.8 0.8 0.8 0.7 0.8 0.8 0.8 0.8% change Oregon 0.8 0.9 1.2 0.9 0.9 0.7 0.9 1.0 1.1 1.2Housing Starts U.S. 0.96 0.90 0.97 1.04 1.11 0.78 0.97 1.23 1.56 1.61U.S. millions, Oregon thousands Oregon 14.5 15.0 15.1 15.6 15.6 10.9 15.0 16.5 19.8 22.1Unemployment Rate U.S. 7.7 7.5 7.6 7.6 7.4 8.1 7.6 7.2 6.6 6.0

Oregon 8.3 7.9 7.8 7.7 7.5 8.7 7.9 7.3 6.9 6.6Total Nonfarm Employment U.S. 1.9 1.6 1.3 1.4 1.5 1.7 1.6 1.6 1.9 1.9% change Oregon 2.6 1.7 1.7 1.9 2.5 1.2 1.9 2.2 2.3 2.1Private Sector Employment U.S. 2.4 1.9 1.7 1.7 1.7 2.2 2.0 1.8 2.2 2.1% change Oregon 3.6 2.5 1.9 2.2 2.9 1.8 2.6 2.5 2.5 2.3

Quarterly Annual

14

2.2 percent – while the range of growth n 2014 is significantly wider – between 1.9 and 3.1 percent. The effective differences in these outlooks are large. Growth of approximately 2 percent is just strong enough to lower the unemployment rate but made no meaningful impact on the feel-good nature of the expansion, whereas if growth does reach 3 percent, it would represent a typical expansion year in Oregon, or a return to the relatively good old days. Even so, personal income growth is expected to remain relatively modest, topping out in the low 5 percent rage. Previous expansions in Oregon saw growth routinely in the 6 or 8 percent rage. Two contributing factors here is lower rates of inflation (the forecasts are nominal, not real) than in previous decades and lower wage gains for nearly all workers in the slack labor market.

Forecast Risks

The economic and revenue outlook is never certain. Our office will continue to monitor and recognize the potential impacts of risk factors on the Oregon economy. Although far from comprehensive, we have identified several major risks now facing the Oregon economy in the list below:

• Federal fiscal policy. The federal sequestration went officially into effect in March, 2013. Outside of outright land ownership, Oregon has a relatively small physical presence of the federal government in the state. In terms of federal grants as a share of state revenue, Oregon ranks 29th highest. For federal procurement as a share of the economy, Oregon ranks 48th highest. Oregon ranks below average in terms of military-dependent industries as well. The one area that Oregon ranks above average is in terms of direct federal employment, ranking 19th highest among all states. However, even here the numbers are somewhat misleading as the nature of these positions may be less affected by the sequestration due to the concentration in hospitals, hydroelectric dams and the Bonneville Power Administration. Even so, to the extent that the national economy falters as the sequestration cuts hit harder, Oregon will be expected to slow down as well. The direct impact may be less than in other states but the impact will be felt nevertheless, particularly as our closest neighbors have large federal and military workforces.

• Strength and durability of housing market recovery. The housing market is growing briskly in terms of home sales and new construction. Inventory is not keeping up with demand and home prices are rising. These market movements are good for both the economy and underwater homeowners. However, even with these increases in activity, there remains much more room for improvements before the market reflects anything approaching normal activity. While foreclosures and long-term delinquency rates remain relatively high, when compared with pre-recession levels, the market has past the peak of foreclosures and is working through the backlog of distressed properties. Oregon, with the rest of the nation, will see sizable improvements to construction activity in 2013 and 2014.

• Ongoing European debt problems and potential financial market contagion or instability. The European high debt, low growth, austerity cycle has continued, more or less, for the past three or four years. So long as Europe is able to continue to muddle through the process, the situation acts as a drag on domestic and global economic growth, however no more so than it already is. With that being said, the potential for another financial crisis unfortunately still looms large as a catastrophic scenario. Domestic credit markets

Forecaster 2013 2014 2015 2013 2014 2015IHS Global Insight 1.6 1.9 2.4 2.3 5.2 5.1Conerly Consulting 2.2 3.1 2.3 5.2Forefront Economics 1.9 2.7 4.1 4.5Portland General Electric 1.8 3.0 4.8 5.5Wells Fargo & Co. 2.0 2.2 4.6 4.8Oregon Office of Economic Analysis 1.9 2.2 2.3 2.0 5.1 5.1Western Blue Chip Consensus 2.0 2.7 3.7 5.1

Employment Personal Income

Comparing Oregon Forecasts, August 2013

15

are easing, but consumers and businesses still have difficulty getting loans. To the extent that credit markets take longer to come back to some sort of state of normalcy, the current recovery could be slower than projected or thrown off track. In such a scenario, Oregon will suffer the consequences along with the rest of the nation.

• Commodity price inflation. Prices for many major commodities are trending down, but remain atypically high from a historical perspective. Future commodity prices will be tied to growth. Should the global expansion pick up speed, a return to high rates of commodity inflation is possible. Always worrisome is the possibility of higher oil (and gasoline) prices. While consumer spending has held up pretty consistently in this recovery, anytime there is a surge in gas prices, it eats away at consumers’ disposable income, leaving less income to spend on all other, non-energy related goods and services.

• Federal timber payments. With the temporary reinstatement over, the loss of these federal funds is impacting Oregon counties, particularly in the southern region of the state. It is clear that federal policymakers will not reinstate the program the same as before, however negotiations are ongoing for more sustainable timber harvests and related revenue. In the meantime, reductions in public employment and services are being felt in the impacted counties. For more information from a historical perspective, see two recent blog posts, here and here6.

• Global Spillovers Both Up and Down. The international list of risks seems to change by the day: sovereign debt problems in Europe, equity and property bubbles in places like South America and Asia, political unrest in the Middle East, and commodity price spikes and inflationary pressures in emerging markets. In particular, with China now a top destination for Oregon exports, the state of the Chinese economy has spillover effects to the Oregon economy. The recent economic slowdown across much of Asia is a growing threat to the Pacific Northwest’s growth prospects.

• Undoing the Federal Policy Used to Combat the Financial Crisis and Recession. Bailouts, tax cuts, monetary quantitative easing, and other fiscal packages most likely prevented a more serious economic downturn. But the clean-up after the storm can have its own risks to the economy. Exit strategies will have to be carefully implemented to prevent premature tightening and choking off the recovery or acting too late to avoid an inflationary environment. All states, including Oregon, face the same risks.

• Initiatives, referendums, and referrals. Generally, the ballot box and legislative changes bring a number of unknowns that could have sweeping impacts on the Oregon economy and revenue picture.

Alternative Scenarios

The baseline forecast is our projection of the most likely outcome for the Oregon economy. As with any forecast, however, many other scenarios are possible. In conjunction with the Legislative Revenue Office, this forecast provides three alternative scenarios, which are modeled on growth patterns over previous business cycles.

Optimistic Scenario: The recovery gathers steam and pulls the economy further away from recession and into a stronger cyclical expansion. The lackluster economic growth seen in the first half of the year proves fleeting and the U.S. economy builds momentum through the end of the year. The economy is soon firing on all cylinders. Economic growth is above potential in 2014 and 2015, resulting in stronger job and income gains. The federal spending sequester is reversed in order to reduce immediate spending cuts, allowing for less fiscal austerity in the near term and supporting overall growth. This stronger growth leads to more consumer spending and more business investment.

In Oregon, job gains are broad based with strong growth in all private sector industries. The unemployment rate declines faster than under the baseline scenario as individuals are able to find employment more readily and income growth accelerates. The increase in employment and income support a self-sustaining economic expansion in which new income fuels increased consumer spending (and debt reduction) which begets further

6 http://oregoneconomicanalysis.wordpress.com/2012/01/23/historical-look-at-oregons-wood-product-industry http://oregoneconomicanalysis.wordpress.com/2013/05/28/timber-counties/

16

increases in employment. Such an expansion increases housing demand as newly employed households (and increasing income for existing households) find their own homes after doubling-up with family and friends during the recession. This results in working down the existing inventory overhang more quickly and new construction returns to normal levels by late 2014 or early 2015.

Mild Recession Scenario: The slowdown in GDP growth in recent quarters continues through the end of 2013, as the federal fiscal drag weighs heavily. While jobs are added over the year, by early 2014 the economy slides slowly back into a recession. Job losses ensure in 2014 and into 2015 and while not severe - about 15,000 jobs in Oregon, it takes a toll on business income, housing starts and personal income. The unemployment rate returns to nearly 9 percent and declines slowly into 2016. The net effect of the mild recession is an extended period of prolonged economic weakness, not unlike Japan’s so-called Lost Decade(s). Although inflation is expected to remain positive, avoiding the deflationary cycle Japan has experienced, basically, since the early 1990s.

Severe Recession Scenario: The slow economic growth in the first half of 2013, coupled with larger-than-expected sequestration impacts sends the economy into free-fall. While the catalyst may be different, the economic effect is similar to late 2008 and early 2009, although not quite as severe when the dust settles. This is little comfort when the unemployment spikes back to over 11 percent and more than 100,000 Oregonians lose their jobs in 2014. Besides the economic headwinds of the federal government, the likely culprit in this scenario is a meltdown of the financial markets sparked by the European sovereign debt crisis. Economic growth in the U.S., while fairly steady, is not nearly strong enough to withstand an external financial shock of this magnitude. Further economic effects of a recession this size are personal income losses of around 4.8 percent, about three-quarters the size of the Great Recession losses in Oregon. Housing starts plummet to near historical low levels of construction and home prices decline further. On the bright side, when construction does rebound, it will result in a surge of new home building that will rise above the state’s long term average level of building due to pent-up demand for housing and the fact that the state will have under built housing during this time period.

Extended Outlook

IHS Global Insight projects Oregon’s economy to fare well relative to the rest of the country in the coming years. The state’s Real Gross State Product is projected to be the third strongest among all states in terms of growth with gains averaging 4.1 percent through 2018. Total employment is expected to be the tenth strongest among all states while manufacturing employment will lead the nation. Total personal income growth is expected to be eleventh fastest among all states.

OEA is somewhat less bullish, but expects Oregon to maintain a growth advantage relative to other states. However, this advantage will be somewhat smaller than the state has enjoyed in past decades.

2013 2014 2015 2015EmploymentBaseline 1.9% 2.2% 2.3% 2.1%Optimistic 2.3% 4.4% 3.0% 1.9%Mild Recession 2.0% 1.0% -0.7% 1.0%Severe Recession 1.8% -2.3% -3.2% 2.4%

Personal IncomeBaseline 2.0% 5.0% 5.1% 5.4%Optimistic 3.3% 8.2% 6.0% 5.1%Mild Recession 2.0% 3.8% 2.3% 5.2%Severe Recession 2.0% 0.3% -0.9% 6.6%

Alternative Scenarios September 2013

1,500,000

1,600,000

1,700,000

1,800,000

1,900,000

2000 2002 2004 2006 2008 2010 2012 2014 2016

Total Nonfarm EmploymentOptimistic Mild RecessionSevere Recession Baseline

17

Oregon has typically benefitted from an influx of households from other states, including an ample supply of skilled workers. Households continue to move to Oregon even when local jobs are scarce, as long as the unemployment rate is equally bad elsewhere (particularly in California). Relative prices of housing also contribute to migration flows in and out of the state. For Oregon’s recent history – data available from 1976 – the labor force in the state has both grown faster than the nation overall and the labor force participation rate has been higher. However three recent trends show potentially worrisome signs. First, the labor force participation rate has declined significantly during and after the Great Recession at both the national and state level. Second, since 2005 Oregon’s labor force participation rate no longer exceeds the national rate as it had for the prior 30 years. Third, during the Great Recession and through the early stages of recovery, the number of individuals in Oregon’s labor force held relatively steady, however in the past year that number is actually declining. All three of these labor force signals are potentially worrisome when it comes to Oregon’s dynamic labor supply. However, how much is attributable to the severe nature of the business cycle, from which one could reasonably expect a rebound, and how much is a fundamental shift in Oregon’s economy is unknown at this time.

In addition to its dynamic labor supply, Oregon also enjoys the long-term advantages of low electricity costs, a central location between the large markets of California, Vancouver and Asia, clean water, low business rents and living costs, and an increasingly diverse industrial base.

One primary long-run concern for policymakers, think tanks and Oregon’s economy is that very little progress on raising per capita income is projected out to 2020. In and of itself, a higher per capita income level would better fund public services for citizens. The Oregon Employment Department has published a detailed look at Oregon’s per capita personal income entitled Why Oregon Trails the Nation; it can be found at:http://olmis.emp.state.or.us/olmisj/PubReader?itemid=00007366

Oregon Exports

According to IHS Global Insight, our global trading partners have a mixed bag in terms of growth prospects. While the Eurozone is expected to continue its downward spiral in 2013 with the outlook even more negative than before, Japan’s prospects have brightened a bit but are still on a slow growth path.

Our top trading partner, Canada, is expected to grow at 1.7 percent in 2013 which is slightly higher than the estimate last quarter of 1.6 percent. China, is expected to grow 7.5 percent this year which is lower than the 8.1 percent growth that was previously assumed. The greatest risk this outlook is any weakness in the global economy as Chinese manufacturing exports are sold to the world. The Eurozone remains in recession, short-circuiting a major trading partner for China, while the U.S. continues to grow at subdued rates from a historical perspective. Given these prospects, in addition to relatively weak domestic economic data in China, growth is expected to be slower than in recent years.

In terms of Oregon’s actual exports in the most recent quarter, they fell by 4.5 percent in nominal terms (-$218 million) compared to Q2 2012. This

2013 2014 2015-18 United States 1.6% 2.7% 3.1%Canada 1.7% 2.4% 2.6%Japan 1.7% 1.9% 1.0%Eurozone -0.7% 0.6% 1.6%Mexico 2.9% 4.6% 4.3%South America 3.0% 3.6% 4.3%Asia except Japan 5.7% 6.3% 6.7%China 7.5% 87.8% 7.7%World 2.4% 3.4% 3.9%

Source: Global Insight, August 2013

Projected Growth Rates of Real GDP

$0

$5,000

$10,000

$15,000

$20,000

$25,000

Q1 1998 Q1 2001 Q1 2004 Q1 2007 Q1 2010 Q1 2013

Oregon all Exports (Four-Quarter Rolling Sum in Millions)

18

decline is mainly due to lower agricultural product exports which dropped by $106 million (-20.1%). This is expected since the discovery of certain genetically modified wheat in Oregon led to import bans from top export countries. In addition Electrical Equipment, Appliances, And Component exports dropped by 84 million dollars (-51.7%).

Industries with notable growth are non-electrical machinery which had growth of almost $100 million (+19.7%) in the second quarter of 2013 compared to the same quarter in 2012 for a total of $602 million.

Even though raw agricultural products declined, food and kindred products grew by $10 million (+6.5%) over the same period and has had steady growth over the last decade and seen exports more than double over that period. Value added processed food exports saw a much smaller dip in the Great Recession compared to general exports and has seen strong steady gains since 2009.

The largest Oregon export of computer and electronic products had tepid growth of $9 million (+0.5%) with a total of $1,721 million in the second quarter and a reversal of the drop it had in the first quarter.

Even though year-over-year growth was negative, Oregon’s top two export destinations were positive. China’s exports grew by $160 million (+26.6%) in Q2 compared with the same quarter last year and Canada grew by $34 million (+4.3%). South Korea (-23.1%), Brazil (-28.3%) and Vietnam (-61.5%) posted large drops in export activity.

Oregon Exports to Major Trading Partners ($ millions, not adjusted for inflation)

Q2-2012 Q2-2013 y/y % change

Share out of Total

Total All Countries 4,865.0 4,647.0 -4.5% 100.0%

China 601 761 26.6% 16.4%Canada 788 822 4.3% 17.7%Malaysia 491 479 -2.4% 10.3%Japan 408 391 -4.2% 8.4%Korea, Republic of 324 249 -23.1% 5.4%Taiwan 232 235 1.3% 5.1%Costa Rica 212 198 -6.6% 4.3%Brazil 219 157 -28.3% 3.4%Vietnam 161 62 -61.5% 1.3%Hong Kong 66 71 7.6% 1.5%Australia 132 120 -9.1% 2.6%Germany 115 98 -14.8% 2.1%Singapore 91 96 5.5% 2.1%Mexico 89 86 -3.4% 1.9%United Kingdom 161 82 -49.1% 1.8%

Source: WISER, August 2013

$0

$100

$200

$300

$400

$500

$600

$700

Q1 1998 Q1 2001 Q1 2004 Q1 2007 Q1 2010 Q1 2013

Oregon Food and Kindred Exports (Four-Quarter Rolling Sum in Millions)

19

Oregon Regional Trends

As discussed previously, job growth in Oregon has accelerated in recent months and continues to spread to regions beyond the Portland Metro. The share of all jobs created in the state that is occurring within the Portland MSA is under 60 percent in early 2013, compared with 90 percent in early 2011. Thankfully this relative decline is not due to job growth in Portland faltering, but rather due to strengthening in the other regions of the state. In particular the hardest hit housing areas of Bend and Medford, which fell the furthest in recession, are now leading the state in job creation rates in the private sector. There remains much ground to recover before reaching pre-recession levels of employment however the momentum is gaining in the right direction.

Portland remains the largest in terms of outright job growth at a steady 20,000 per year since 2011, however all other regions of the state combined are now creating approximately 15,000 private sector jobs in the past year.

The Columbia Gorge and North Coast are the other two regions in the state creating jobs at an above average rate. The Willamette Valley, while adding 5,500 private sector jobs in the past year, is a notch below the state average in job growth. Northeast Oregon, the South Coast and Southeast Oregon are all lagging the statewide trends in terms of job creation, however job gains have returned as the labor market slowly heals in these areas.

Seeing the recovery continue to spread to the state’s other cities and regions outside of Portland is highly encouraging and certainly needed. As the economy continues to expand, expectations are this growth with strengthen in the more rural areas.

The Oregon Office of Economic Analysis is now publishing one page summaries on each region of the state on a rotation basis over the course of the year. This publication schedule will allow two or three regional summaries per quarter, with a planned schedule as follows:

• March forecast: South Coast, Southern Oregon • June forecast: Central Oregon, Columbia Gorge, North Coast • September forecast : Northeast Oregon, Southeast Oregon • December forecast: Portland Metro, Willamette Valley

3,200

3,600 600 1,000 19,500 34,100

5,500

500 200

24 0%

1%

2%

3%

4%

5%

6%

Central Oregon

S. Oregon

Gorge North Coast

PDX Sum of Counties

Valley NE Oregon

South Coast

SE Oregon

Private Sector Growth by Region Mar '12 - Mar '13, QCEW

0

10,000

20,000

30,000

40,000

Jan-11 Jan-12 Jan-13

Oregon Employment Gains QCEW, Year-over-Year

All Counties Portland MSA Ex Portland MSA

20

Northeast Oregon

Baker, Grant, Morrow, Umatilla, Union, Wallowa

Forests, agriculture and formidable terrain cover much of this region that stretches east of the Cascades to the Idaho border and the Columbia River and Washington to the north. Covering nearly 20 percent of the state’s landmass, yet home to 3.7 percent of its population, the majority which live near or along I-84 in Hermiston (population 16,995), Pendleton (16,715), La Grande (13,110) and Baker City (9.890). The region’s dominant industries are highlighted by animal and agricultural related employment, in addition to key transportation sectors.

The region as a whole experienced a less severe Great Recession than the state with job losses of approximately 4 percent compared with the statewide average of nearly 8.5 percent. The unemployment rate spiked as job losses mounted, but not to the same degree as the state. However the labor market recovery that began in 2010 is now stalling locally and in recent months, job losses have returned and the unemployment rate is falling less quickly than statewide trends. Private sector growth in the past 12 months is negative in 4 of the 6 counties. While Grant and Wallowa are registering gains through July, growth rates are just 0.4 and 0.5 percent respectively, which are less than the statewide gains of 2.6 percent.

Overall the region’s strength in agriculture and related industries has benefited the regional economy compared with most others; however growth and momentum have stalled recently.

0%

2%

4%

6%

8%

10%

12%

14%

Jan-90 Jan-94 Jan-98 Jan-02 Jan-06 Jan-10

Unemployment Rate (SA) U.S. Oregon Northeast Oregon

-14%

-12%

-10%

-8%

-6%

-4%

-2%

0%

2%

Peak 1 2 3 4 5 6 7 8 9 10

% Jo

b Lo

ss fr

om P

eak

Empl

oym

ent

No. Years from Employment Peak

NE Oregon's Employment Loss by Recession

Early 80s 1990 2001

3.1% 3.7%

10.7% 11.8%

24.3%

0%

5%

10%

15%

20%

25%

30%

Total Nonfarm Employment

Population Farm Income (Labor &

Proprietors)

Agriculture Employment

Agriculture Sales (2011)

Northeast Oregon as Share of State Top 10 Industries by Location Quotient, 2012 1) Animal Production, NAICS 112 2) Agriculture & Forestry Support, NAICS 115 3) Food Manufacturing, NAICS 311 4) Crop Production, NAICS 111 5) Gas Stations, NAICS 447 6) Truck Transportation, NAICS 484 7) Utilities, NAICS 221 8) Federal Government 9) State Government 10) Local Government

82 84 86 88 90 92 94 96 98

100

1969 1974 1979 1984 1989 1994 1999 2004 2009

Real Personal Income less Transfer Payments, Percent of Previous Peak, 1969-2011

Oregon Northeast Oregon

21

Southeast Oregon

Harney, Klamath, Lake, Malheur

The region varies considerably in both climate and industries as one heads east from the Cascades to the Idaho border in this southern swath of the state. To the west lies the majority of the population and nonfarm employment in Klamath. A large timber and related industries concentration in addition to tourism-related sectors play an important role and the county is home to the state’s only national park, Crater Lake. To the east the landscape opens up and the population becomes more spare, until you hit the eastern edge of the state where another population base is located in Ontario in the Treasure Valley. Overall these four counties contain just under 3 percent of the state’s population, 35 percent of its landmass and nearly 15 percent of all agricultural sales.

Over the past year job growth has returned to three of the four counties with only Harney seeing losses. Somewhat unique to this expansion, much of the employment gains are in the goods-producing industries such as natural resources, construction and manufacturing, although each county differs slightly. Service sector jobs are growing less briskly, unlike overall trends in recent decades. Over the longer term, one would expect these trends to reverse, however in the short-run a cyclical rebound in these industries is welcomed and expected. In terms of growth rates, Lake and Malheur are growing the strongest at 2.3 and 1.2 percent respectively, while Klamath is effectively stable.

0%

2%

4%

6%

8%

10%

12%

14%

16%

Jan-90 Jan-94 Jan-98 Jan-02 Jan-06 Jan-10

Unemployment Rate (SA) U.S. Oregon Southeast Oregon

-14%

-12%

-10%

-8%

-6%

-4%

-2%

0%

2%

Peak 1 2 3 4 5 6 7 8 9 10

% Jo

b Lo

ss fr

om P

eak

Empl

oym

ent

No. Years from Employment Peak

SE Oregon's Employment Loss by Recession

Early 80s 1990 2001 Current

2.3% 2.9% 3.4%

8.2%

14.6%

0% 2% 4% 6% 8%

10% 12% 14% 16%

Total Nonfarm Employment

Population Farm Income (Labor &

Proprietors)

Agriculture Employment

Agriculture Sales (2011)

Southeast Oregon as Share of State Top 10 Industries by Location Quotient, 2012 1) Animal Production, NAICS 112 2) Wood Products Manufacturing, NAICS 321 3) Gas Stations, NAICS 447 4) Federal Government 5) Crop Production, NAICS 111 6) State Government 7) General Merchandise, NAICS 452 8) Accommodation, NAICS 721 9) Warehousing & Storage, NAICS 493 10) Motor Vehicle & Parts Dealers, NAICS 441

82 84 86 88 90 92 94 96 98

100

1969 1974 1979 1984 1989 1994 1999 2004 2009

Real Personal Income less Transfer Payments, Percent of Previous Peak, 1969-2011

Oregon Southeast Oregon

22

State Comparisons

The Great Recession took a massive toll on employment counts, household finances and need-based aid programs that are broadly called the safety net. The recovery seen in the past four years has been lackluster from historical perspective and while nearly all economic and labor market indicators are moving in the right direction, the pace of this improvement leaves much to be desired. Job growth has been just strong enough to bring the unemployment rate down slowly but broader measures such as the employment to population ratio have barely budged. Long-term unemployment remains a big issue across the nation and part-time work for economic reasons is still effectively twice as large as prior to the onset of recession. While the economy is improving, it has not been fast enough to produce higher rates of labor utilization across the board, wage gains above the rate of inflation or, in other words, the “feel good” nature of the expansion is not here, at least not yet.

One broad measure of the labor market is the U6 unemployment rate which includes the underemployed and discouraged workers within its numbers. This differs from the standard unemployment rate, sometimes referred to as U3, which only counts individuals without a job who are looking for work.

At the height of the economic expansion before the Great Recession (2007), Oregon had the highest U6 unemployment rate compared to the other western states at ten percent but was quickly surpassed by Nevada and California which were impacted to a larger degree as their disproportionately large housing boom relative to other states turned into a bust.

The average U6 unemployment in western states rose by 11.3 percent from its low point in 2007 (7.8% average) to its high point in 2010 (19.1% average). The U.S. as a whole rose by a smaller 8.4 percent over that period. Oregon saw its U6 rate increase by 10.7 percent from its low point to its peak in 2009. Nevada saw both the largest increase at 16 percentage points, and reached the highest level among the states at nearly 24 percent in 2010.

Utah has had the lowest average U6 over the last decade compared to western states and peaked at the lowest rate and has seen the sharpest decline of (-3.9%) since 2010 with a 11.2 percent rate in 2012. Oregon has also seen a decent decline of 3.5 percent in its U6 rate compared to its peak of 20.7 percent in 2009 but still maintains at an above-average rate of 17.2 percent in 2012.

A large safety-net program for workers is the unemployment insurance (UI) system. The graph above illustrates the proportion of people that exhausted their regular UI benefits that run for 26 weeks. In December of 2007 the average ratio of persons that exhausted their UI benefits were 36 percent of those who received benefits nationally and 33 percent for the western states.

The highest ratio of people that exhausted their benefits nationally was in March 2010 at 56 percent. Different states reached their peaks at different points in time. Arizona saw the highest ratio at 66 percent while

0%

5%

10%

15%

20%

25%

2004 2005 2006 2007 2008 2009 2010 2011 2012

U6 Unemployment Rate

AZ CA ID NV

OR UT WA U.S.

0%

10%

20%

30%

40%

50%

60%

70%

AZ CA ID NV OR UT WA US

UI Exhaustion Rate, Regular Program

Max Jul-13 Dec-07

US

23

Washington had the lowest peak at 51 percent. Oregon’s UI exhaustion rate ratio peaked at 55 percent in June 2010.

The latest data (July 2013) show that even 5 years into the recovery, those who are receiving UI benefits still do not find work after 6 months and exhaust their state benefits at an elevated level. The average ratio between western states was 42 percent in July 2013 which is almost ten percent higher than in December 2007.

Graph X illustrates another aspect of unemployment. Since being defined as “unemployed” according to the BLS does not necessitate receiving UI benefits, looking at the ratio of those who are eligible and receive UI benefits to the population that BLS defines as “unemployed” shows another aspect of the unemployment picture.

Since there are strict criteria to be eligible for UI benefits (must have been working recently, laid off and not fired due to poor performance, etc.), a high ratio denotes a cohort of unemployed that have a recent job history and were active in the labor force. A low ratio denotes that the majority of those unemployed are recent entrants into the job market or have returned from a hiatus.

In 2009, 66 percent of the unemployed in western states were receiving unemployment benefits from the UI system and the U.S. average was 63 percent. Idaho had the largest ratio at 80 percent and Utah had the lowest ratio at 54 percent. In the first quarter of this year, the numbers have decreased sharply with 41 percent of the unemployed in western states are receiving UI benefits and the national average was at 43 percent. A caveat to this data is that a person does not necessarily have to be unemployed to receive unemployment benefits. A worker is eligible to receive benefits if their employer cuts back their hours by a certain amount.

Another safety net program that runs in tandem with economic oscillation is the SNAP program. Graph X illustrates the proportion of persons in western states that receive this supplemental food program. In 2007, the average western state had 7.1 percent of its population participating in this program and the national average was 8.3 percent. By the end of the Great Recession in 2009 that number increased to 10 percent of the population for western states and continued to increase up to 2012. The average western state now has 14.5 percent of its population participating in this program with the national average at 14.8 percent. Utah has had the lowest average SNAP participation ratio over the last decade and broke the trend in 2012 by being the only western state to lower the ratio of persons in this program.

80% 78%

60%

69%63%

72%

52% 54%48% 48% 47%

43% 43% 41%34%

24%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

ID OR CA WA U.S. NV UT AZ

Unemployment Insurance Recipiency Rate

2009 2013q1

0%

5%

10%

15%

20%

25%

2004 2005 2006 2007 2008 2009 2010 2011 2012

SNAP Usage Ratio

AZ CA ID NV

OR UT WA U.S.

24

REVENUE FORECAST

Revenue Forecast Summary

In keeping with the stable economic outlook, expectations for General Fund revenue growth have remained largely unchanged since the last quarterly forecast. Along with underlying job growth, personal income taxes paid out of labor income are expected to accelerate somewhat during the 2013-15 biennium. Healthy income tax collections during July and August suggest that tax revenues are following this script for now.

Although improved, overall revenue growth is expected to remain modest from an historical perspective. Underlying job gains, while accelerating, will not match the pace seen during previous periods of economic expansion. Also, personal income taxes based on investment income will grow slowly in the near term since many Oregonians cashed out gains in 2012 in anticipation of federal tax rate increases. Tax revenue growth is expected to fall in between the rates Oregon has become accustomed to during past periods of economic expansion, and the slow gains we have seen in recent years.

Although the outlook for the 2013-15 biennium remains on track, the final weeks of the 2011-13 biennium were a disappointment. A backlog of personal and corporate income tax refund payments were processed and issued shortly after the May forecast was released. As a result, the 2013-15 beginning balance is now expected to be smaller than it was at that time.

Despite the stable forecast, many risks to the outlook remain. In particular, if Oregon’s traditionally strong migration trends and labor force gains reappear, a short-term revenue boom remains possible during the 2013-15 budget period.

The primary downside risk facing the near-term revenue forecast is the uncertain future of the nationwide economic expansion. Should federal government austerity or economic weakness abroad derail the U.S. economy, the expected growth in Oregon’s tax collections will not come to pass.

Revenue growth in Oregon and other states will face considerable downward pressure over the 10-year extended forecast horizon. As the baby boom population cohort works less and spends less, traditional state tax instruments such as personal income taxes and general sales taxes will become less effective, and revenue growth will fail to match the pace seen in the past.

2013-15 General Fund Revenues

A strong 2013 season of income tax collections put General Fund revenues for the 2011-13 biennium right in line with the Close of Session’s relatively optimistic outlook. Both personal and corporate income tax collections closely matched expectations.

Although underlying economic growth will be stronger in 2013-15, General Fund revenue growth is not expected to match the pace seen during the last biennium. Personal income taxes flowing from labor income are accelerating. However, this improvement is expected to be offset by slower growth in taxable investment income such as capital gains. Furthermore, legislators are not expected to enact $200 million in additional revenue items as they did to avoid program cuts in 2011-13.

Excluding legislative actions taken during the 2013 session, the revenue outlook for the 2013-15 biennium is largely unchanged relative to the May 2013 forecast. Including legislative changes, the forecast for General Fund revenues for 2013-15 is now $15,648 million. This represents an increase of $42 million (+0.3%) from the May 2013 forecast.

The September forecast for the 2013-15 biennium is $6 million (0.0%) above the Close of Session forecast. A modest improvement in the outlook for personal income taxes was offset by an expected decline in corporate tax collections resulting from a recent legal decision.

25

Personal Income Tax

Personal income tax collections were $2,046 million for the fourth quarter of fiscal year 2013, $34.3 million (-1.6%) below the latest forecast. Compared to the year-ago level, total personal income tax collections grew by 11.4% relative to a forecast that called for 13.3% growth. Appendix B presents a comparison of actual and projected personal income tax revenues for the April-June quarter.

Personal income tax collections grew strongly during the April 2013 filing season as the 2012 gains seen in stock markets and across other investments were realized for tax purposes. In addition to asset appreciation, a considerable amount of taxable investment income has been generated by taxpayers choosing to cash in their assets ahead of federal tax increases in 2013. Due largely to this pulling forward of income, year-end personal income tax payments came in more than 25% higher than last tax season. Quarterly forecast errors for the personal income tax estimates were driven by unexpectedly large refund payments that were processed during the final weeks of fiscal year 2013.

Going forward into the 2013-15 biennium, personal income tax collections are expected to grow at somewhat below average rates. Although growth in taxable wages is accelerating, growth in overall collections will be held back by slower growth in taxable investment income and fewer legislatively enacted revenue increases.

Corporate Excise Tax

Corporate excise tax collections equaled $134 million for the fourth quarter of fiscal year 2013, $30.7 million below the May forecast. Compared to one year ago, net corporate receipts were down 22% with the forecast calling for a 4% decline.

The rapid growth in corporate tax collections seen early in 2013 came to a sudden halt at the end of the year, leaving corporate collections well short of the kicker threshold. Corporate collections ended the biennium 1% below the Close of Session forecast, which was nearly $30 million short of the kicker threshold.

As with personal income taxes, quarterly forecast errors for the corporate tax estimates were driven by unexpectedly large refund payments that were processed during the final weeks of fiscal year 2013. After the dust settled, refund payments during the April-June quarter were ten times larger than last year.

(Millions)2013 COS Forecast

May 2013 Forecast

September 2013 Forecast

Change from Prior Forecast

Change from COS Forecast

Structural RevenuesPersonal Income Tax $13,558.2 $13,579.5 $13,603.5 $24.0 $45.3

Corporate Income Tax $1,056.6 $1,036.6 $1,012.0 -$24.5 -$44.5

All Other Revenues $1,027.9 $990.5 $1,032.7 $42.2 $4.8

Gross GF Revenues $15,642.6 $15,606.5 $15,648.2 $41.7 $5.6

Offsets and Transfers -$120.8 -$120.8 -$100.3 $20.6 $20.6

Administrative Actions1 -$18.2 -$18.2 -$13.6 $4.7 $4.7

Legislative Actions -$136.9 -$137.3 -$136.9 $0.5 $0.0

Net Available Resources $15,910.1 $15,827.3 $15,870.4 $43.2 -$39.7

Confidence Intervals67% Confidence +/- 9.0% $1,405.095% Confidence +/- 18.0% $2,810.0

1 Reflects cost of cashflow management actions, ex clusiv e of internal borrow ing.

2013-15 General Fund Forecast Summary

$14.24B to $17.05B$12.84B to $18.46B

Table R.1

26

Even after the end-year correction, corporate tax collections remain large from an historical perspective. Near-record corporate profits have yet to go away. Given that corporate tax collections and underlying profits are subject to boom-bust cycles, there is a considerable amount of downside risk to the outlook.

Nevertheless, strong growth is expected during the 2013-15 biennium, since Oregon’s economy is expected to continue to grow, and corporate tax collections are sensitive to the business cycle. However, these growth rates, while large, will remain less than half of what has been seen during recent profit booms.

Corporate income tax collections for 2013-15 are $24.5 million lower than what was called for in the May forecast. This downward revision is due largely to a court ruling that has allowed corporations to take credits against the minimum tax. Claims will be filed back to the imposition of the minimum tax in 2009.

Other Sources of Revenue

All other General Fund revenues are expected to total $1,033 million for the 2013-15 biennium, an increase of $42 million relative to the May forecast. This increase can be traced to actions taken during the 2013 legislative session.

In particular, $32 million in one-time actions will be transferred to the general fund under HB2322. Also, business registry fees with the Secretary of State’s office have been increased by $4 million, and a liquor bottle surcharge was added ($14.3 million).

Extended General Fund Revenue Outlook

Table R.2 exhibits the long-run forecast for General Fund revenues through the 2021-23 biennium. Users should note that the potential for error in the forecast increases substantially the further ahead we look.

General Fund revenues will total $17,374 million in 2015-17, an increase of 11.0% percent from the prior period, and $10 million (+0.1%) above the May forecast. In 2017-19, revenue growth is expected to slow to 8.7%, followed by rates of around 10% in subsequent biennia. The slowdown in long-run revenue growth is largely due to the impact of demographic changes and changes in savings behavior. Table B.2 in Appendix presents a more detailed look at the long-term General Fund revenue forecast.

Table R.2General Fund Revenue Forecast Summary (Millions of Dollars, Current Law)

Forecast Forecast Forecast Forecast Forecast Forecast2011-13 % 2013-15 % 2015-17 % 2017-19 % 2019-21 % 2021-23 %

Revenue Source Biennium Chg Biennium Chg Biennium Chg Biennium Chg Biennium Chg Biennium Chg

Personal Income Taxes 12,118.2 15.8% 13,603.5 12.3% 15,323.2 12.6% 16,793.5 9.6% 18,458.7 9.9% 20,411.8 10.6%

Corporate Income Taxes 883.9 6.8% 1,012.0 14.5% 1,028.8 1.7% 1,003.4 -2.5% 1,034.1 3.1% 1,096.7 6.1%

All Others 1,175.8 -4.1% 1,032.7 -12.2% 1,022.1 -1.0% 1,087.6 6.4% 1,170.9 7.7% 1,277.2 9.1%

Gross General Fund 14,177.9 13.2% 15,648.2 10.4% 17,374.1 11.0% 18,884.5 8.7% 20,663.7 9.4% 22,785.7 10.3%

Offsets and Transfers (12.0) (100.3) (117.5) (83.5) (46.0) (48.8)

Net Revenue 14,165.9 13.1% 15,547.9 9.8% 17,256.6 11.0% 18,801.0 8.9% 20,617.8 9.7% 22,736.9 10.3%

Other tax es include General Fund portions of the Eastern Oregon Sev erance Tax , Western Oregon Sev erance Tax and Amusement Dev ice Tax .Commercial Fish Licenses & Fees and Pari-mutual Receipts are included in Other Rev enues

27

Tax Law Assumptions

The revenue forecast is based on existing law, including measures and actions signed into law during the 2013 Oregon Legislative Session. OEA makes routine adjustments to the forecast to account for legislative and other actions not factored into the personal and corporate income tax models. These adjustments can include expected kicker refunds, when applicable, as well as any tax law changes not yet present in the historical data. A summary of actions taken during the 2013 Legislative Session can be found in Appendix B Table B.3. For a detailed treatment of the components of the 2013 Legislatively Enacted Budget, see: LFO 2013-15 Budget Summary

The treatment of the corporate taxes represents an important current area of policy uncertainty. Policymakers and the court system are currently determining if firms can be asked to pay excise taxes based on a single sales apportionment factor. Depending on the future treatment of corporate tax liability, the outlook for collections could be lowered on the order of $100 million per biennium.

Other recent tax law changes involve the treatment of court fees and criminal fines. These changes have significantly increased the amount of judicial related funds flowing into the General Fund, but the exact magnitude of the impact remains unclear.

Although based on current law, many of the tax policies that impact the revenue forecast are not set in stone. In particular, sunset dates for many large tax credits have been scheduled. As credits are allowed to disappear, considerable support is lent to the revenue outlook in the outer years of the forecast. To the extent that tax credits are extended and not allowed to expire when their sunset dates arrive, the outlook for revenue growth will be reduced. The current forecast relies on estimates taken from the Oregon Department of Revenue’s 2013-15 Tax Expenditure Report.

Alternative Scenarios

The latest revenue forecast for the current biennium represents the most probable outcome given available information. OEA feels that it is important that anyone using this forecast for decision-making purposes recognize the potential for actual revenues to depart significantly from this projection.

Currently, the overwhelming downside risk facing the revenue outlook is the threat that the U.S. economy will slip back into recession in the near term. Such a scenario, however it played out, would result in drastic revenue losses.

Two recessionary scenarios are displayed in table R.2b. In a severe recession, biennial revenues could fall by as much as $2 billion.7

7 The methodology for computing alternative scenarios has recently been changed to reflect recent work done by the

Legislative Revenue Office. Assumptions: Recessions begin in 2015 and return to baseline income by 2022. The moderate recession scenario assumes personal income growth will be reduced by one-half relative to the baseline in 2015 and 2016. The severe recession scenario assumes personal income will decline in 2015 by as much as it did in 2009. The percentage deviation in personal income taxes is 1.4 times the deviation in personal income. The percentage deviation in corporate income taxes is 2.0 times the deviation in personal income.

28

Lottery Earnings Forecast

Table R.3 presents a summary of lottery earnings and distribution for the 2013-15 BN. Revenues and available resources from Lottery games and programs are projected to total $1,059.5 million, a gain of $2.8 million from both the May 2013 and Close of Session forecasts. The increase is the result of stronger than expected sales in traditional games, in particular jackpot games.

Overall, video lottery dominates total lottery earnings, accounting for approximately 85 percent of all lottery transfers in the past three years. Although growth has generally been slow in recent years, it has stabilized after declining substantially in the wake of the Great Recession and enactment of the smoking ban. In total, declines in video lottery sales approached 23 percent from pre-recession highs to the depths of the recession; the same magnitude of losses seen in slot machine revenues in Clark County, Nevada, home of Las Vegas. So far, Oregon video lottery sales have rebounded at approximately twice the rates seen at Clark County slot machines.

TABLE R2b

Baseline Case

2014-15Fiscal Year

2015-16Fiscal Year

2016-17Fiscal Year

2017-18Fiscal Year

2018-19Fiscal Year

2019-20Fiscal Year

2020-21Fiscal Year

2021-22Fiscal Year

2022-23Fiscal Year

Personal IncomeLevel 157.8 166.0 174.7 184.1 193.6 202.7 212.2 221.9 232.8% change 3.4% 5.2% 5.2% 5.4% 5.2% 4.7% 4.7% 4.6% 4.9%

Taxes

Personal Income 7,068 7,474 7,849 8,211 8,583 9,004 9,455 9,918 10,462Corporate Excise & Income 524 519 510 503 500 507 527 557 571Other General Fund 505 506 516 535 552 576 595 613 628Total General Fund 8,097 8,499 8,875 9,249 9,635 10,088 10,576 11,088 11,660% change 7.2% 5.0% 4.4% 4.2% 4.2% 4.7% 4.8% 4.8% 5.2%

Mild Recession2014-15

Fiscal Year2015-16

Fiscal Year2016-17

Fiscal Year2017-18

Fiscal Year2018-19

Fiscal Year2019-20

Fiscal Year2020-21

Fiscal Year2021-22

Fiscal Year2022-23

Fiscal Year

Personal IncomeLevel 157.8 162.0 166.3 177.1 188.5 198.9 209.8 219.9 231.2% change 5.1% 2.6% 2.7% 6.5% 6.4% 5.5% 5.5% 4.8% 5.1%

Taxes

Personal Income 7,068 7,219 7,321 7,777 8,263 8,770 9,305 9,787 10,340Deviation from baseline -255 -528 -434 -320 -235 -149 -131 -122Corporate Excise & Income 524 494 461 465 474 489 515 547 562Deviation from baseline -25 -49 -38 -27 -19 -12 -10 -8Other General Fund 505 506 516 535 552 576 595 613 628Total General Fund 8,097 8,219 8,298 8,778 9,289 9,834 10,415 10,948 11,530% change 7.2% 1.5% 1.0% 5.8% 5.8% 5.9% 5.9% 5.1% 5.3%Deviation from baseline -280 -577 -471 -346 -253 -161 -141 -130

Severe Recession

2014-15Fiscal Year

2015-16Fiscal Year

2016-17Fiscal Year

2017-18Fiscal Year

2018-19Fiscal Year

2019-20Fiscal Year

2020-21Fiscal Year

2021-2022Fiscal Year

2020-21Fiscal Year

Personal IncomeLevel 157.8 151.3 157.7 170.3 183.5 195.8 208.7 218.8 229.9% change 5.1% -4.1% 4.2% 8.0% 7.7% 6.7% 6.6% 4.8% 5.1%

Taxes

Personal Income 7,068 6,546 6,779 7,353 7,952 8,577 9,236 9,715 10,264Deviation from baseline -928 -1,070 -858 -631 -427 -218 -203 -198Corporate Excise & Income 524 427 410 428 448 473 509 541 556Deviation from baseline -92 -99 -75 -52 -34 -17 -16 -14Other General Fund 505 506 516 535 552 576 595 613 628Total General Fund 8,097 7,479 7,706 8,316 8,952 9,626 10,340 10,869 11,448% change 7.2% -7.6% 3.0% 7.9% 7.6% 7.5% 7.4% 5.1% 5.3%Deviation from baseline -1,020 -1,169 -933 -683 -461 -236 -219 -212

September 2013 Alternative Cyclical Revenue Forecast ($ millions)

29

Table R.3

COS 2013

May 2013 Forecast

Sept 2013 Forecast

May 2013 Forecast

COS 2013

Transfers of Lottery EarningsTraditional Games $122.7 $122.7 $129.5 $6.8 $6.8Video Lottery $931.9 $931.9 $927.9 -$4.1 -$4.1Administrative Savings $0.0 $0.0 $0.0 $0.0 $0.0Total Transfers $1,054.6 $1,054.6 $1,057.3 $2.8 $2.8

Economic Development FundBeginning Balance $3.5 $3.5 $3.5 $0.0 $0.0Transfers from Lottery $1,054.6 $1,054.6 $1,057.3 $2.8 $2.8Other earnings1 $1.4 $1.4 $1.4 $0.0 $0.0Total Available Resources $1,059.5 $1,059.5 $1,062.2 $2.8 $2.8

Dedicated Distributions2 $404.1 $404.1 $405.0 $0.9 $0.9Other Legislatively Adopted Allocations $640.4 $640.4 $640.4 $0.0 $0.0Total Distributions $1,044.5 $1,044.5 $1,045.4 $0.9 $0.9

Ending Balance $15.0 $15.0 $16.8 $1.8 $1.8

Changes from:

Footnotes: 1. Includes interest earnings and rev ersions.2. Includes Education Stability Fund (18%), Parks and Natural Resources Fund (15%), Sports Lottery (1%), Gambling Addiction (1%), and County Distributions

2013-15 Lottery Fund Forecast Summary

0.0%

0.1%

0.2%

0.3%

0.4%

0.5%

0.6%

0.7%

0.8%

2000Q1 2003Q1 2006Q1 2009Q1 2012Q1

Gambling as a Share of Personal Income

U.S. Casino Gambling Oregon Video Lottery

Moving beyond 2013 and into future years as the economic expansion continues and strengthens, so too do video lottery sales. Over the forecast horizon video lottery sales are projected to increase at a rate of growth that is just under the gains seen in overall personal income. Even with the video lottery sales increases in recent years, these gains have not been quite as strong as the underlying economic conditions. Consumers remain cautious with their disposable income and while their overall entertainment spending is increasing, the share of their budgets spent on these activities has not increased. This has not been the case in past years with gains in video lottery having outstripped spending on other items throughout the Lottery’s history. Eventually as video games lose some of their novelty, sales growth will slow to more sustainable levels. For a more thorough look at Lottery revenues and consumer spending on gaming over the business cycle, please see our office’s research report available on our website8.

Another major item affecting Lottery transfers for state revenue purposes is the capital replacement plan that Lottery will implement over the FY 2014-2017 time frame. During the next two biennia, Lottery will replace the 12,000 existing video lottery terminals throughout the state, some of which will be nine years old when they are replaced. Due to advancements in technology, like a lot of industries, the current machines are becoming obsolete in the marketplace. This replacement plan is expected to cost approximately $215 million over four years, of which Lottery will self-fund $85 million. The remaining $130 million will be deducted from Lottery earnings prior to being transferred for general revenue purposes. The biennial impact of the replacement plan is $71.2 million in 2013-15, or less than 7 percent of available revenue to be transferred, and $59.2 million in 2015-17, or about 5 percent.

The full extended outlook for lottery earnings can be found in Table B.9 in Appendix B.

8 http://oregoneconomicanalysis.wordpress.com/2013/03/20/gaming-and-the-great-recession/

30

Table R.4

(Millions)2011-13

Biennium2013-15

Biennium2015-17

BienniumRainy Day Fund

Beginning Balance $10.4 $61.8 $263.7Net Deposits3 $50.8 $199.9 $197.0Interest $0.6 $2.0 $18.2Ending Balance1 $61.8 $263.7 $479.0

Education Stability FundBeginning Balance $5.1 $7.6 $187.9Net Deposits $184.8 $180.3 $197.2Interest2 $0.6 $1.0 $13.5Withdrawals -$182.9 -$1.0 -$13.5Ending Balance $7.6 $187.9 $385.1

Total Reserves $69.4 $451.6 $864.1

Percent of General Fund Revenues 0.5% 2.9% 5.0%

Oregon's Budgetary Reserves

Footnotes:1. Under current law , only 2/3rds of the beginning balance is av ailable for w ithdraw al. Withdraw al subject to economic and financial triggers.2. Education Stability Fund interest is distributed to the Oregon Education Fund (75%) and the State Scholarship Commission (25%).3. Includes transfer of ending General Fund balances, up to 1% of budgeted appropriations, as w ell as priv ate donations.

Overview of Budgetary Reserves

The state currently administers two general reserve accounts, the Oregon Rainy Day Fund (ORDF) and the Education Stability Fund (ESF). This section updates balances and recalculates the outlook for these funds based on the December revenue forecast.

Established by the 2007 Legislature, the ORDF is funded from ending balances each biennium, up to one percent of appropriations. The Legislature can deposit additional funds, as it did in first populating the ORDF with surplus corporate income tax revenues from the 2005-07 biennium. The ORDF also retains interest earnings. Withdrawals from the ORDF require one of three triggers, including a decline in employment, a projected budgetary shortfall, or declaration of a state of emergency, plus a three-fifths vote. Withdrawals are capped at two-thirds of the balance as of the beginning of the biennium in question. Fund balances are capped at 7.5 percent of General Fund revenues in the prior biennium.

The ESF gained its current reserve structure and mechanics via constitutional amendment in 2002. The ESF receives 18 percent of lottery earnings9, deposited on a quarterly basis. The ESF does not retain interest earnings. The ESF has similar triggers as the ORDF (in fact, the ORDF was modeled on the ESF), but does not have the two-thirds cap on withdrawals. The ESF balance is capped at five percent of General Fund revenues collected in the prior biennium.

Budgetary Reserve Outlook

Table R.4 presents projected balances for the ORDF and ESF. The ORDF ended the 2011-13 biennium with a balance of $61.8 million, while the ESF ended the biennium with a balance of $7.6 million. Combined, these reserve funds total approximately one-half of one percent of the 2011-13 General Fund revenues.

As the accounting books for the 2011-13 biennium close out, per statute given the positive ending balance to the General Fund, one percent of appropriation will be deposited into the ORDF in the coming months. This deposit will be $136.9 million. Additionally, at the end of the 2013-15 biennium, the corporate tax revenue due to the increases in the tax rate from Measure 67 (above the 6.6% rate) will be deposited into the ORDF. The current estimate for the biennium is $42.7 million.

In 2013-15, the ESF is expected to see deposits of $180.3 million based on Lottery sales. There are no scheduled withdrawals out of the ESF and the ending balance is projected to be $187.9 million at the end of the biennium.

B.10 in Appendix B provides more details for Oregon’s budgetary reserves.

9 Five percent of these transfers are deposited to the Oregon Growth sub-account. Due to the illiquid nature of this

sub-account, only funds in the main account are included in the figures presented here.

31

APPENDIX A: ECONOMIC FORECAST DETAIL

Table A.1 Employment Forecast Tracking ………………………………………...................................... 32

Table A.2 Short-term Oregon Economic Summary ……………………..................................................... 33

Table A.3 Oregon Economic Forecast Change …………………………………………………………… 34

Table A.4 Annual Economic Forecast ……………………………………………………………………. 35

32

Table A.1 – Employment Forecast Tracking

Total Nonfarm Employment, 2nd quarter 2013(Employment in thousands, Annualized Percent Change)

Y/YChange

level % ch level % ch level % % ch

Total Nonfarm 1,668.1 1.7 1,665.9 1.6 2.2 0.1 1.9 Total Private 1,380.9 2.5 1,377.3 2.0 3.6 0.3 2.6 Natural Resources and Mining 7.7 4.2 7.4 1.2 0.3 4.4 6.7 Construction 73.4 8.6 71.0 4.6 2.4 3.4 5.3 Manufacturing 175.2 2.8 174.3 2.9 0.9 0.5 2.0 Durable Goods 124.0 4.5 123.7 3.4 0.3 0.3 2.3 Wood Product 20.7 (1.2) 20.8 2.9 (0.1) (0.6) 5.9 Metals and Machinery 35.5 2.7 35.6 2.1 (0.1) (0.3) 2.6 Computer and Electronic Product 36.6 2.3 37.2 6.6 (0.6) (1.7) (1.3) Transportation Equipment 11.0 (3.7) 11.2 1.3 (0.1) (1.3) (0.2) Other Durable Goods 20.2 24.6 18.9 1.6 1.3 7.0 6.2 Nondurable Goods 51.2 (1.1) 50.7 1.7 0.6 1.1 1.5 Food 25.8 0.9 24.6 0.1 1.2 4.8 3.5 Other Nondurable Goods 25.4 (3.0) 26.0 3.2 (0.6) (2.4) (0.5) Trade, Transportation & Utilities 321.8 0.8 323.5 2.4 (1.7) (0.5) 1.8 Retail Trade 190.4 1.4 191.9 2.9 (1.5) (0.8) 1.8 Wholesale Trade 76.6 (1.6) 76.7 1.6 (0.2) (0.2) 1.9 Transportation, Warehousing & Utilities 54.8 2.3 54.8 1.6 (0.0) (0.0) 1.7 Information 32.5 2.0 32.9 2.2 (0.4) (1.1) 0.1 Financial Activities 92.4 0.1 92.7 0.3 (0.3) (0.3) 2.3 Professional & Business Services 201.2 2.7 200.7 1.6 0.5 0.3 3.4 Educational & Health Services 242.1 1.4 241.9 (0.1) 0.2 0.1 1.9 Educational Services 34.2 0.2 33.7 (9.2) 0.5 1.4 1.1 Health Services 207.9 1.6 208.2 1.5 (0.3) (0.1) 2.1 Leisure and Hospitality 176.6 6.2 174.5 2.6 2.0 1.2 4.6 Other Services 58.0 0.5 58.4 5.5 (0.4) (0.6) 1.0Government 287.2 (1.9) 288.6 (0.2) (1.4) (0.5) (1.2) Federal 27.5 (6.9) 28.0 1.0 (0.5) (1.7) (1.0) State 80.5 2.5 80.2 (0.3) 0.3 0.4 0.8 State Education 32.2 3.2 32.2 3.9 (0.1) (0.2) 1.6 Local 179.3 (3.0) 180.5 (0.4) (1.2) (0.7) (2.0) Local Education 92.8 (3.4) 93.3 (0.6) (0.6) (0.6) (2.5)

EstimatePreliminary Forecast ErrorForecast

33

Table A.2 – Short-term Oregon Economic Summary

Oregon Forecast Summary

2013:1 2013:2 2013:3 2013:4 2014:1 2011 2012 2013 2014 2015 2016

Nominal Personal Income 151.9 153.4 154.2 156.5 159.3 145.3 151.2 154.0 162.6 171.4 180.7% change (4.5) 4.1 2.1 6.1 7.4 5.4 4.0 1.9 5.6 5.4 5.4

130.1 131.5 132.0 133.4 135.3 127.7 130.6 131.8 137.3 142.6 147.8% change (5.4) 4.3 1.3 4.6 5.7 2.9 2.2 0.9 4.2 3.8 3.7Nominal Wages and Salaries 78.2 78.8 79.5 80.7 82.0 74.8 77.7 79.3 83.8 88.5 93.0% change 0.7 3.1 3.6 6.1 6.4 4.6 3.9 2.1 5.7 5.6 5.1

Per Capita Income ($1,000) 38.9 39.2 39.2 39.7 40.4 37.6 38.9 39.2 41.0 42.8 44.5% change (5.2) 3.2 0.9 5.1 6.4 4.8 3.3 1.0 4.5 4.2 4.2Average Wage rate ($1,000) 46.6 46.7 47.0 47.5 48.0 45.6 46.8 47.0 48.5 50.0 51.4% change (1.9) 1.6 2.4 4.3 3.7 3.4 2.6 0.3 3.3 3.0 2.8Population (Millions) 3.9 3.9 3.9 3.9 3.9 3.86 3.89 3.92 3.96 4.01 4.06% change 0.8 0.9 1.2 0.9 0.9 0.6 0.7 0.9 1.0 1.1 1.2Housing Starts (Thousands) 14.5 15.0 14.5 15.6 15.6 8.0 10.9 14.9 16.5 19.8 22.1% change 89.2 13.4 (12.7) 34.1 1.9 5.4 35.5 37.1 10.8 20.4 11.3Unemployment Rate 8.3 7.9 7.8 7.7 7.5 9.6 8.7 7.9 7.3 6.9 6.6Point Change (0.1) (0.4) (0.1) (0.2) (0.2) (1.2) (0.9) (0.8) (0.6) (0.5) (0.3)

Total Nonfarm 1,661.0 1,668.1 1,672.7 1,679.7 1,690.2 1,620.2 1,640.1 1,670.4 1,707.5 1,748.8 1,786.0% change 2.6 1.7 1.1 1.7 2.5 1.1 1.2 1.8 2.2 2.4 2.1 Private Nonfarm 1,372.4 1,380.9 1,385.1 1,391.6 1,401.3 1,325.2 1,349.3 1,382.5 1,417.6 1,455.8 1,489.3 % change 3.6 2.5 1.2 1.9 2.8 1.8 1.8 2.5 2.5 2.7 2.3 Construction 71.9 73.4 74.0 74.7 75.7 68.6 69.8 73.5 77.3 81.2 84.6 % change 11.9 8.6 3.4 3.8 5.6 1.4 1.7 5.3 5.2 5.0 4.2 Manufacturing 174.0 175.2 174.4 175.1 176.2 168.1 171.8 174.7 178.0 182.9 186.2 % change 2.7 2.8 (1.9) 1.8 2.4 2.6 2.2 1.7 1.9 2.8 1.8 Durable Manufacturing 122.6 124.0 123.2 123.8 124.7 118.6 121.6 123.4 126.3 130.6 133.6 % change 0.8 4.5 (2.4) 2.0 2.8 3.2 2.5 1.5 2.3 3.5 2.3 Wood Product Manufacturing 20.7 20.7 20.7 20.8 21.2 19.2 19.8 20.7 22.0 24.6 26.0 % change 9.6 (1.2) 0.5 2.9 6.6 (3.7) 2.7 4.9 6.2 11.7 5.7 High Tech Manufacturing 36.4 36.6 36.7 36.9 37.1 36.4 37.0 36.7 37.3 37.9 38.2 % change (4.3) 2.3 1.7 1.7 1.9 4.1 1.6 (0.9) 1.8 1.5 0.7 Transportation Equipment 11.1 11.0 11.0 11.0 11.1 10.7 11.1 11.1 11.1 11.5 11.8 % change (3.4) (3.7) 0.4 0.4 1.2 5.2 3.1 (0.2) 0.8 2.9 3.3 Nondurable Manufacturing 51.3 51.2 51.1 51.3 51.5 49.5 50.3 51.2 51.7 52.3 52.6 % change 7.5 (1.1) (0.7) 1.4 1.5 1.2 1.5 2.0 0.9 1.1 0.6 Private nonmanufacturing 1,198.4 1,205.7 1,210.7 1,216.4 1,225.2 1,157.1 1,177.5 1,207.8 1,239.7 1,272.9 1,303.2 % change 3.8 2.4 1.7 1.9 2.9 1.6 1.8 2.6 2.6 2.7 2.4 Retail Trade 189.7 190.4 191.0 191.5 192.8 184.8 187.2 190.7 194.8 198.9 203.1 % change 2.6 1.4 1.2 1.2 2.6 0.9 1.3 1.8 2.2 2.1 2.1 Wholesale Trade 76.9 76.6 76.8 77.0 77.4 74.2 75.3 76.8 78.1 79.6 81.1 % change 5.6 (1.6) 1.0 1.2 2.2 1.3 1.5 2.0 1.7 1.9 2.0 Information 32.4 32.5 32.8 33.0 33.0 32.1 32.5 32.7 33.2 33.9 34.7 % change (2.1) 2.0 2.7 2.3 1.1 (0.0) 1.2 0.7 1.8 2.0 2.4 Professional and Business Services 199.9 201.2 202.3 203.6 205.6 188.6 195.4 201.8 209.1 218.6 226.7 % change 4.8 2.7 2.1 2.6 4.1 3.5 3.6 3.3 3.7 4.5 3.7 Health Services 207.1 207.9 208.8 209.4 210.6 201.2 204.2 208.3 212.9 217.9 222.7 % change 2.5 1.6 1.7 1.3 2.3 2.1 1.5 2.0 2.2 2.4 2.2 Leisure and Hospitality 173.9 176.6 177.6 178.6 179.8 165.6 169.8 176.7 181.8 185.7 188.5 % change 4.8 6.2 2.3 2.5 2.7 2.0 2.5 4.1 2.9 2.2 1.5 Government 288.6 287.2 287.6 288.2 288.9 295.0 290.8 287.9 289.9 293.0 296.6 % change (1.9) (1.9) 0.5 0.8 0.9 (1.6) (1.4) (1.0) 0.7 1.1 1.2

Personal Income ($ billions)

Other Indicators

Employment (Thousands)

Annual

Real Personal Income (base year=2005)

Quarterly

34

Table A.3 – Oregon Economic Forecast Change

Oregon Forecast Change (Current vs. Last)

2013:1 2013:2 2013:3 2013:4 2014:1 2011 2012 2013 2014 2015 2016

Nominal Personal Income 151.9 153.4 154.2 156.5 159.3 145.3 151.2 154.0 162.6 171.4 180.7% change (1.1) (1.2) (1.7) (1.3) (1.2) 0.0 (0.1) (1.3) (0.9) (0.6) (0.4)

130.1 131.5 132.0 133.4 135.3 127.7 130.6 131.8 137.3 142.6 147.8% change (1.3) (1.1) (1.5) (1.0) (1.0) 0.0 (0.1) (1.2) (0.7) (0.4) (0.2)Nominal Wages and Salaries 78.2 78.8 79.5 80.7 82.0 74.8 77.7 79.3 83.8 88.5 93.0% change (1.1) (1.3) (1.4) (1.0) (0.8) 0.0 (0.1) (1.2) (0.4) 0.2 0.3

Per Capita Income ($1,000) 38.9 39.2 39.2 39.7 40.4 37.6 38.9 39.2 41.0 42.8 44.5% change (1.1) (1.2) (1.7) (1.3) (1.2) 0.0 (0.1) (1.3) (0.9) (0.6) (0.4)Average Wage rate ($1,000) 46.6 46.7 47.0 47.5 48.0 45.6 46.8 47.0 48.5 50.0 51.4% change (1.6) (1.7) (1.6) (1.0) (0.7) 0.0 0.1 (1.5) (0.4) 0.1 0.3Population (Millions) 3.91 3.92 3.93 3.9 3.9 3.86 3.89 3.92 3.96 4.01 4.06% change 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Housing Starts (Thousands) 14.5 15.0 14.5 15.6 15.6 8.0 10.9 14.9 16.5 19.8 22.1% change 15.5 17.4 11.0 16.1 12.6 (0.2) (0.5) 15.0 9.9 0.9 (2.0)Unemployment Rate 8.3 7.9 7.8 7.7 7.5 9.6 8.7 7.9 7.3 6.9 6.6Point Change 0.0 (0.3) (0.1) (0.1) (0.1) 0.1 0.1 (0.2) (0.2) (0.1) (0.1)

Total Nonfarm 1,661.0 1,668.1 1,672.7 1,679.7 1,690.2 1,620.2 1,640.1 1,670.4 1,707.5 1,748.8 1,786.0% change 0.5 0.5 0.2 0.0 (0.0) (0.0) (0.1) 0.3 0.1 0.1 (0.0) Private Nonfarm 1,372.4 1,380.9 1,385.1 1,391.6 1,401.3 1,325.2 1,349.3 1,382.5 1,417.6 1,455.8 1,489.3 % change 0.8 0.9 0.6 0.3 0.3 (0.0) (0.2) 0.7 0.4 0.4 0.3 Construction 71.9 73.4 74.0 74.7 75.7 68.6 69.8 73.5 77.3 81.2 84.6 % change 2.7 3.8 3.1 2.6 2.6 (0.1) (0.6) 3.0 2.4 1.7 1.3 Manufacturing 174.0 175.2 174.4 175.1 176.2 168.1 171.8 174.7 178.0 182.9 186.2 % change 0.4 0.6 (0.5) (0.6) (0.6) (0.1) 0.0 (0.0) (0.6) (1.3) (2.2) Durable Manufacturing 122.6 124.0 123.2 123.8 124.7 118.6 121.6 123.4 126.3 130.6 133.6 % change (0.6) (0.0) (1.3) (1.5) (1.5) (0.1) (0.1) (0.9) (1.4) (2.2) (3.4) Wood Product Manufacturing 20.7 20.7 20.7 20.8 21.2 19.2 19.8 20.7 22.0 24.6 26.0 % change 2.8 1.9 0.6 (0.1) 0.3 (0.3) 0.4 1.3 0.7 (0.2) (0.8) High Tech Manufacturing 36.4 36.6 36.7 36.9 37.1 36.4 37.0 36.7 37.3 37.9 38.2 % change (3.7) (4.1) (4.4) (4.7) (5.0) (0.1) (0.3) (4.2) (5.0) (6.2) (8.0) Transportation Equipment 11.1 11.0 11.0 11.0 11.1 10.7 11.1 11.1 11.1 11.5 11.8 % change (2.4) (3.5) (3.6) (3.5) (3.4) (1.1) (0.9) (3.3) (3.2) (4.1) (5.2) Nondurable Manufacturing 51.3 51.2 51.1 51.3 51.5 49.5 50.3 51.2 51.7 52.3 52.6 % change 2.8 2.1 1.5 1.5 1.5 (0.1) 0.2 2.0 1.5 1.3 0.8 Private nonmanufacturing 1,198.4 1,205.7 1,210.7 1,216.4 1,225.2 1,157.1 1,177.5 1,207.8 1,239.7 1,272.9 1,303.2 % change 0.9 1.0 0.7 0.5 0.4 (0.0) (0.2) 0.8 0.5 0.7 0.6 Retail Trade 189.7 190.4 191.0 191.5 192.8 184.8 187.2 190.7 194.8 198.9 203.1 % change 0.4 0.4 0.3 0.2 0.5 (0.0) (0.0) 0.4 1.1 1.8 2.0 Wholesale Trade 76.9 76.6 76.8 77.0 77.4 74.2 75.3 76.8 78.1 79.6 81.1 % change 1.6 0.9 0.6 0.5 0.6 (0.0) 0.1 0.9 0.9 1.1 1.0 Information 32.4 32.5 32.8 33.0 33.0 32.1 32.5 32.7 33.2 33.9 34.7 % change (1.1) (0.9) (0.4) 0.0 0.2 (0.4) 0.1 (0.6) 0.6 1.0 1.8 Professional and Business Services 199.9 201.2 202.3 203.6 205.6 188.6 195.4 201.8 209.1 218.6 226.7 % change 1.4 1.3 0.7 (0.2) (0.6) 0.4 0.0 0.8 (0.8) (1.4) (2.2) Health Services 207.1 207.9 208.8 209.4 210.6 201.2 204.2 208.3 212.9 217.9 222.7 % change 0.5 0.4 0.3 0.3 0.2 (0.1) (0.0) 0.4 0.4 0.9 1.1 Leisure and Hospitality 173.9 176.6 177.6 178.6 179.8 165.6 169.8 176.7 181.8 185.7 188.5 % change 1.3 2.4 2.2 1.7 1.5 (0.1) (0.0) 1.9 1.6 1.8 2.0 Government 288.6 287.2 287.6 288.2 288.9 295.0 290.8 287.9 289.9 293.0 296.6 % change (1.1) (1.5) (1.6) (1.6) (1.5) 0.1 (0.1) (1.4) (1.5) (1.5) (1.5)

Employment (Thousands)

Personal Income ($ billions)

Quarterly Annual

Real Personal Income (base year=2005)

Other Indicators

35

Table A.4 Annual Economic Forecast

TABLE A.4Sep 2013 - Personal Income

(Billions of Current Dollars)

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Total Personal Income* Oregon 145.3 151.2 154.1 161.9 170.2 179.3 189.0 198.0 207.4 217.1 226.8 238.9 % Ch 5.4 4.0 2.0 5.0 5.1 5.4 5.4 4.8 4.7 4.7 4.5 5.3 U.S. 12,947.3 13,431.2 13,808.5 14,490.5 15,198.5 15,959.7 16,759.2 17,532.2 18,315.4 19,101.1 19,875.7 20,688.8 % Ch 5.1 3.7 2.8 4.9 4.9 5.0 5.0 4.6 4.5 4.3 4.1 4.1

Wage and SalaryOregon 74.8 77.7 79.2 82.5 86.6 90.9 95.2 99.4 103.4 107.6 112.0 117.0 % Ch 4.6 3.9 2.0 4.2 5.0 5.0 4.7 4.3 4.0 4.1 4.0 4.5 U.S. 6,661.3 6,906.0 7,132.7 7,447.5 7,805.5 8,174.9 8,538.2 8,887.4 9,244.4 9,606.7 9,963.7 10,331.8 % Ch 4.0 3.7 3.3 4.4 4.8 4.7 4.4 4.1 4.0 3.9 3.7 3.7

Other Labor IncomeOregon 18.2 18.9 19.3 20.0 20.9 21.9 22.9 23.9 24.9 25.9 26.9 27.9 % Ch 4.8 3.4 2.2 3.6 4.6 4.7 4.7 4.5 4.1 4.0 3.8 3.8 U.S. 1,139.0 1,172.2 1,204.5 1,249.6 1,306.6 1,369.0 1,434.8 1,501.4 1,564.7 1,627.6 1,688.9 1,749.6 % Ch 3.8 2.9 2.8 3.7 4.6 4.8 4.8 4.6 4.2 4.0 3.8 3.6

Nonfarm Proprietor's IncomeOregon 11.0 11.6 12.2 13.0 13.9 14.6 15.0 15.4 16.0 16.6 17.3 17.8 % Ch 3.6 5.0 5.0 7.1 6.6 4.9 2.7 3.1 3.9 3.8 3.9 3.0 U.S. 1,102.8 1,146.1 1,211.2 1,294.0 1,384.6 1,461.8 1,509.6 1,565.1 1,637.4 1,713.3 1,794.9 1,884.2 % Ch 4.1 3.9 5.7 6.8 7.0 5.6 3.3 3.7 4.6 4.6 4.8 5.0

Dividend, Interest and RentOregon 26.0 27.5 28.9 30.5 32.2 34.3 37.4 40.0 42.4 44.7 46.8 49.7 % Ch 7.3 5.6 5.0 5.8 5.3 6.6 9.1 6.9 6.1 5.3 4.8 6.2 U.S. 2,094.8 2,212.3 2,325.7 2,472.1 2,602.7 2,769.0 3,012.0 3,221.7 3,397.7 3,553.5 3,694.7 3,845.2 % Ch 7.6 5.6 5.1 6.3 5.3 6.4 8.8 7.0 5.5 4.6 4.0 4.1

Transfer PaymentsOregon 29.5 30.4 31.3 33.3 35.0 37.0 38.7 40.2 42.4 44.9 47.4 50.1 % Ch 2.4 3.0 3.2 6.2 5.2 5.8 4.6 3.9 5.5 5.7 5.6 5.7 U.S. 2,274.3 2,329.2 2,406.1 2,538.3 2,645.9 2,772.3 2,888.5 3,018.7 3,176.8 3,349.8 3,522.5 3,708.2 % Ch 1.7 2.4 3.3 5.5 4.2 4.8 4.2 4.5 5.2 5.4 5.2 5.3

Contributions for Social SecurityOregon 11.8 12.2 14.1 14.7 15.5 16.4 17.1 17.8 18.5 19.3 20.1 20.1 % Ch (5.7) 3.3 15.1 4.7 5.6 5.4 4.6 4.0 4.1 4.1 4.0 (0.0) U.S. 424.4 436.7 579.6 614.2 655.7 698.4 734.1 769.3 804.9 841.2 877.4 915.0 % Ch (17.6) 2.9 32.7 6.0 6.8 6.5 5.1 4.8 4.6 4.5 4.3 4.3

Residence AdjustmentOregon (2.8) (2.9) (2.9) (3.0) (3.1) (3.2) (3.4) (3.5) (3.6) (3.7) (3.8) (3.9) % Ch 19.1 5.2 (0.8) 3.8 4.3 4.3 4.0 3.4 3.0 3.1 3.0 3.0

Farm Proprietor's IncomeOregon 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 % Ch 273.8 1.4 (24.0) 7.2 11.9 (2.4) 0.8 42.8 (1.4) (3.0) (2.9) (9.0)

Per Capita Income (Thousands of $)Oregon 37.6 38.9 39.3 40.8 42.5 44.2 46.0 47.6 49.3 51.0 52.6 54.7 % Ch 4.8 3.3 1.1 4.0 3.9 4.1 4.1 3.5 3.5 3.4 3.2 4.0 U.S. 41.5 42.7 43.6 45.4 47.2 49.2 51.3 53.2 55.2 57.1 59.0 60.9 % Ch 4.3 3.0 2.0 4.1 4.1 4.2 4.2 3.8 3.7 3.5 3.3 3.3

* Personal Income includes all classes of income minus Contributions for Social Security

36

TABLE A.4Sep 2013 - Employment By Industry(Oregon - Thousands, U.S. - Millions)

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Total NonfarmOregon 1,620.2 1,640.1 1,671.8 1,708.6 1,747.5 1,785.1 1,816.5 1,843.0 1,865.4 1,884.9 1,900.0 1,914.6 % Ch 1.1 1.2 1.9 2.2 2.3 2.1 1.8 1.5 1.2 1.0 0.8 0.8 U.S. 131.5 133.7 135.9 138.0 140.6 143.3 145.4 146.8 148.0 149.0 149.5 150.0 % Ch 1.2 1.7 1.6 1.6 1.9 1.9 1.5 1.0 0.8 0.7 0.3 0.4

Private NonfarmOregon 1,325.2 1,349.3 1,383.9 1,418.7 1,454.5 1,488.4 1,516.4 1,539.3 1,558.1 1,572.5 1,585.8 1,597.3 % Ch 1.8 1.8 2.6 2.5 2.5 2.3 1.9 1.5 1.2 0.9 0.8 0.7 U.S. 109.4 111.8 114.0 116.1 118.6 121.1 123.1 124.3 125.3 126.0 126.5 126.9 % Ch 1.9 2.2 2.0 1.8 2.2 2.1 1.6 1.0 0.8 0.5 0.4 0.3

Natural Resources and MiningOregon 7.0 7.2 7.7 8.0 8.2 8.3 8.4 8.4 8.4 8.3 8.3 8.3 % Ch 4.6 3.1 6.9 3.5 2.0 1.8 0.9 (0.1) (0.1) (0.3) (0.6) (0.3) U.S. 0.8 0.9 0.9 0.9 0.9 0.9 1.0 1.0 1.0 1.0 1.0 1.0 % Ch 11.8 8.0 2.8 3.4 1.3 2.9 1.9 (0.1) 0.3 0.9 0.7 (0.2)

ConstructionOregon 68.6 69.8 73.8 77.3 80.8 84.2 85.8 86.9 88.4 89.7 90.7 91.7 % Ch 1.4 1.7 5.8 4.7 4.5 4.2 1.9 1.3 1.6 1.5 1.1 1.1 U.S. 5.5 5.6 5.8 6.1 6.8 7.5 7.9 8.0 8.1 8.2 8.3 8.4 % Ch 0.3 2.0 3.3 5.3 11.6 10.0 4.4 1.8 1.4 1.4 0.9 0.7

ManufacturingOregon 168.1 171.8 174.8 178.4 183.6 187.6 189.4 191.0 192.1 192.4 192.5 192.8 % Ch 2.6 2.2 1.8 2.0 2.9 2.2 0.9 0.8 0.6 0.2 0.1 0.2 U.S. 11.7 11.9 12.0 12.1 12.4 12.6 12.6 12.6 12.6 12.6 12.6 12.5 % Ch 1.7 1.7 0.5 1.1 2.0 1.6 0.3 0.2 0.2 (0.2) (0.4) (0.5)

Durable ManufacturingOregon 118.6 121.6 123.6 126.6 131.3 135.0 136.4 137.6 138.2 138.3 138.2 138.3 % Ch 3.2 2.5 1.7 2.5 3.7 2.8 1.1 0.8 0.5 0.0 (0.1) 0.1 U.S. 7.3 7.5 7.5 7.6 7.9 8.1 8.1 8.2 8.2 8.2 8.1 8.1 % Ch 3.0 2.6 0.7 1.7 3.2 2.6 0.5 0.1 0.3 (0.1) (0.4) (0.5)

Wood ProductsOregon 19.2 19.8 20.7 22.0 24.5 25.9 25.7 25.6 25.3 25.0 24.7 24.5 % Ch (3.7) 2.7 4.9 6.0 11.4 5.6 (0.5) (0.5) (1.2) (1.2) (1.1) (0.8) U.S. 0.3 0.3 0.4 0.4 0.5 0.6 0.6 0.5 0.6 0.6 0.5 0.5 % Ch (1.5) 0.4 3.5 20.2 26.6 8.6 (3.0) (2.4) 1.0 (0.1) (2.3) (2.4)

Metal and MachineryOregon 33.3 34.6 35.6 36.2 36.5 36.9 37.5 38.2 38.8 38.9 38.9 39.0 % Ch 6.9 3.9 2.6 1.7 0.9 1.1 1.7 1.9 1.4 0.4 0.1 0.2 U.S. 2.8 2.9 2.9 3.0 3.1 3.2 3.2 3.3 3.3 3.3 3.3 3.3 % Ch 5.7 4.3 0.8 2.2 2.9 3.5 1.6 0.2 0.6 0.6 0.4 0.3

Computer and Electronic ProductsOregon 36.4 37.0 36.7 37.4 38.1 38.8 39.1 39.4 39.7 40.0 40.3 40.5 % Ch 4.1 1.6 (0.8) 2.1 1.9 1.6 0.8 0.8 0.9 0.7 0.7 0.7 U.S. 1.1 1.1 1.1 1.1 1.0 1.0 1.0 1.1 1.1 1.1 1.1 1.1 % Ch 0.8 (0.9) (0.5) (1.9) (2.3) (1.0) 1.6 2.6 1.9 1.2 1.0 1.0

T ransportation EquipmentOregon 10.7 11.1 11.1 11.2 11.5 11.9 12.1 12.1 11.9 11.5 11.1 10.8 % Ch 5.2 3.1 (0.2) 1.1 3.2 3.2 1.9 (0.4) (1.8) (3.2) (3.1) (2.8) U.S. 1.4 1.5 1.5 1.5 1.5 1.6 1.5 1.5 1.5 1.5 1.4 1.4 % Ch 3.6 5.4 1.9 0.2 2.4 2.4 (0.8) (1.1) (1.4) (2.3) (2.4) (2.9)

Other DurablesOregon 18.9 19.1 19.5 19.9 20.7 21.5 22.0 22.3 22.6 22.9 23.1 23.4 % Ch 1.6 1.2 2.4 1.7 4.0 4.1 1.9 1.4 1.6 1.2 1.0 1.2 U.S. 2.0 2.0 2.0 2.2 2.3 2.4 2.3 2.3 2.3 2.3 2.3 2.3 % Ch 0.0 0.3 2.1 5.5 6.3 3.0 (0.5) (0.4) 0.3 (0.0) (0.5) (0.6)

Nondurable ManufacturingOregon 49.5 50.3 51.3 51.8 52.3 52.6 52.9 53.4 53.8 54.1 54.3 54.5 % Ch 1.2 1.5 2.0 1.0 1.1 0.6 0.6 0.8 0.8 0.6 0.4 0.4 U.S. 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.4 4.4 % Ch (0.2) 0.1 0.2 0.1 (0.2) (0.1) 0.0 0.3 (0.1) (0.3) (0.5) (0.7)

Food ManufacturingOregon 24.2 24.7 25.7 25.6 25.8 25.9 25.9 26.1 26.2 26.3 26.3 26.4 % Ch 1.7 2.1 3.7 (0.1) 0.6 0.3 0.4 0.4 0.5 0.4 0.2 0.4 U.S. 1.5 1.5 1.5 1.5 1.5 1.5 1.6 1.6 1.6 1.6 1.6 1.6 % Ch 0.5 0.7 0.5 2.0 1.1 1.4 1.3 1.4 0.8 0.5 0.4 0.2

Other NondurableOregon 25.3 25.5 25.6 26.1 26.5 26.8 27.0 27.3 27.6 27.8 28.0 28.1 % Ch 0.7 0.9 0.4 2.0 1.5 0.9 0.8 1.3 1.0 0.7 0.6 0.4 U.S. 3.0 3.0 3.0 3.0 3.0 2.9 2.9 2.9 2.9 2.9 2.8 2.8 % Ch (0.6) (0.2) 0.5 (0.7) (1.0) (0.8) (0.6) (0.4) (0.6) (0.8) (0.9) (1.1)

Trade, Transportation, and UtilitiesOregon 312.4 316.6 322.6 329.1 335.6 343.3 351.0 356.6 359.1 359.0 358.6 358.0 % Ch 1.2 1.3 1.9 2.0 2.0 2.3 2.2 1.6 0.7 (0.0) (0.1) (0.2) U.S. 25.1 25.5 25.9 26.2 26.5 26.9 27.3 27.6 27.6 27.6 27.4 27.3 % Ch 1.7 1.8 1.5 1.0 1.2 1.6 1.6 0.8 0.2 (0.2) (0.4) (0.5)

37

TABLE A.4Sep 2013 - Employment By Industry(Oregon - Thousands, U.S. - Millions)

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022Retail TradeOregon 184.8 187.2 190.8 194.2 197.8 202.0 206.1 209.1 210.0 209.2 208.4 207.8 % Ch 0.9 1.3 1.9 1.8 1.8 2.1 2.0 1.4 0.4 (0.4) (0.3) (0.3) U.S. 14.7 14.9 15.1 15.1 15.2 15.3 15.4 15.4 15.4 15.3 15.2 15.0 % Ch 1.6 1.4 1.6 0.1 0.2 0.8 0.8 0.1 (0.2) (0.5) (0.7) (0.9)

Wholesale TradeOregon 74.2 75.3 76.9 78.4 79.8 81.3 83.0 84.3 85.2 85.7 86.0 86.2 % Ch 1.3 1.5 2.1 2.0 1.7 2.0 2.1 1.5 1.1 0.6 0.3 0.2 U.S. 5.5 5.7 5.8 5.9 6.0 6.1 6.3 6.4 6.4 6.4 6.5 6.5 % Ch 1.7 2.4 1.5 1.9 2.0 2.3 2.3 1.5 0.9 0.4 0.3 0.2

Transportation and Warehousing, and UtilitiesOregon 53.4 54.0 55.0 56.5 58.0 59.9 61.9 63.3 63.9 64.1 64.1 64.0 % Ch 2.3 1.2 1.8 2.7 2.8 3.2 3.2 2.3 1.1 0.3 0.0 (0.1) U.S. 4.9 5.0 5.0 5.2 5.3 5.5 5.7 5.8 5.8 5.8 5.8 5.8 % Ch 2.3 2.4 1.4 2.6 3.1 3.3 3.1 2.1 0.5 (0.0) (0.2) (0.3)

InformationOregon 32.1 32.5 32.6 33.2 33.8 34.6 35.5 36.1 36.6 37.2 37.8 38.4 % Ch (0.0) 1.2 0.6 1.7 2.0 2.4 2.5 1.6 1.5 1.6 1.7 1.7 U.S. 2.7 2.7 2.7 2.7 2.7 2.7 2.8 2.8 2.9 2.9 3.0 3.0 % Ch (1.2) 0.1 1.0 (1.6) 0.4 2.2 1.9 1.3 1.7 1.8 2.0 1.9

Financial ActivitiesOregon 91.7 90.8 92.6 94.4 96.0 97.5 98.6 99.6 100.3 100.8 101.0 101.1 % Ch (1.6) (0.9) 1.9 2.0 1.7 1.5 1.2 1.0 0.6 0.5 0.3 0.1 U.S. 7.7 7.8 7.9 8.0 8.0 7.9 7.8 7.8 7.8 7.8 7.8 7.7 % Ch 0.0 1.2 1.3 1.0 0.1 (0.8) (0.8) (0.7) (0.2) (0.0) (0.3) (0.2)

Professional and Business ServicesOregon 188.6 195.4 201.9 209.2 218.3 226.4 232.2 236.9 242.3 247.8 253.5 259.7 % Ch 3.5 3.6 3.3 3.6 4.4 3.7 2.6 2.0 2.3 2.3 2.3 2.4 U.S. 17.3 17.9 18.5 19.3 20.1 20.8 21.3 21.7 22.2 22.6 23.1 23.7 % Ch 3.6 3.5 3.3 4.1 4.4 3.3 2.4 1.9 2.2 2.2 2.2 2.3

Education and Health ServicesOregon 234.3 238.2 242.6 247.6 252.2 257.2 263.0 268.8 273.8 278.5 283.3 286.5 % Ch 2.3 1.7 1.8 2.1 1.9 2.0 2.3 2.2 1.9 1.7 1.7 1.1 U.S. 19.9 20.3 20.7 21.0 21.3 21.8 22.3 22.7 23.0 23.2 23.3 23.3 % Ch 1.8 2.2 1.8 1.7 1.3 2.2 2.2 1.9 1.3 0.7 0.5 0.3

Educational ServicesOregon 33.0 33.9 34.1 34.0 34.2 34.5 34.8 35.3 35.7 36.2 36.6 37.1 % Ch 3.8 2.8 0.6 (0.3) 0.5 0.7 1.0 1.3 1.3 1.3 1.1 1.4 U.S. 3.3 3.3 3.4 3.3 3.2 3.2 3.2 3.2 3.2 3.1 3.1 3.0 % Ch 3.1 3.0 0.4 (1.6) (2.0) (1.2) (0.2) 0.0 (0.9) (1.6) (2.2) (2.4) Health Care and Social AssistanceOregon 201.2 204.2 208.4 213.6 218.0 222.8 228.2 233.5 238.1 242.3 246.7 249.3 % Ch 2.1 1.5 2.0 2.5 2.1 2.2 2.4 2.3 2.0 1.8 1.8 1.1 U.S. 16.6 17.0 17.3 17.7 18.1 18.6 19.1 19.5 19.8 20.0 20.2 20.4 % Ch 1.6 2.0 2.1 2.3 1.9 2.8 2.7 2.2 1.7 1.0 0.9 0.7

Leisure and HospitalityOregon 165.6 169.8 176.8 181.6 184.9 187.5 189.6 191.4 192.8 193.8 194.5 194.7 % Ch 2.0 2.5 4.1 2.7 1.8 1.4 1.1 0.9 0.8 0.5 0.4 0.1 U.S. 13.4 13.7 14.1 14.3 14.5 14.6 14.7 14.8 14.8 14.8 14.8 14.7 % Ch 2.4 3.0 2.7 1.6 1.3 0.7 0.5 0.4 0.3 (0.1) (0.3) (0.4) O ther ServicesOregon 56.8 57.3 58.5 59.9 61.0 61.9 62.9 63.7 64.4 65.0 65.6 66.1 % Ch 0.4 0.8 2.0 2.5 1.7 1.5 1.6 1.3 1.1 1.0 0.9 0.8 U.S. 5.4 5.4 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.4 5.4 5.4 % Ch 0.6 1.4 0.9 0.6 (0.5) (0.4) 0.2 0.1 (0.6) (0.5) (0.5) (0.5)

GovernmentOregon 295.0 290.8 287.9 289.9 293.0 296.6 300.2 303.6 307.2 312.5 314.2 317.4 % Ch (1.6) (1.4) (1.0) 0.7 1.1 1.2 1.2 1.2 1.2 1.7 0.6 1.0 U.S. 22.1 21.9 21.8 21.9 22.0 22.1 22.3 22.5 22.6 22.9 22.9 23.0 % Ch (1.8) (0.8) (0.4) 0.2 0.4 0.7 0.7 0.8 0.7 1.3 (0.1) 0.5

Federal GovernmentOregon 28.8 28.1 27.8 27.9 27.8 27.6 27.5 27.5 27.5 29.1 27.6 27.5 % Ch (5.6) (2.3) (1.2) 0.4 (0.4) (0.8) (0.1) (0.1) (0.1) 5.8 (5.2) (0.2) U.S. 2.9 2.8 2.7 2.7 2.7 2.7 2.6 2.6 2.6 2.7 2.6 2.6 % Ch (3.9) (1.5) (2.6) (0.2) (0.3) (1.9) (1.2) (1.2) (0.9) 5.2 (5.5) (0.6) State Government, O regonState Total 80.6 80.0 80.4 80.9 81.4 82.0 82.9 83.8 84.7 85.6 86.4 87.2 % Ch 1.0 (0.7) 0.5 0.6 0.6 0.8 1.1 1.1 1.1 1.0 0.9 0.9 State Education 31.1 31.8 32.1 32.3 32.4 32.5 32.7 33.0 33.3 33.5 33.8 34.1 % Ch 4.5 2.1 1.0 0.5 0.3 0.4 0.7 0.8 0.8 0.8 0.8 0.7 Local Government, O regonLocal Total 185.6 182.7 179.8 181.1 183.8 187.1 189.7 192.3 195.0 197.8 200.3 202.7 % Ch (2.1) (1.6) (1.6) 0.8 1.5 1.8 1.4 1.4 1.4 1.4 1.3 1.2 Local Education 96.9 95.4 93.0 93.4 95.4 97.6 99.4 101.1 102.6 104.1 105.5 107.0 % Ch (3.3) (1.6) (2.6) 0.5 2.1 2.3 1.9 1.7 1.5 1.4 1.4 1.4

38

TABLE A.4Sep 2013 - Other Economic Indicators

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022GDP (Bil of 2005 $), Chain Weight (in billions of $) 13,299.1 13,593.2 13,815.2 14,188.7 14,683.1 15,141.3 15,589.0 16,007.1 16,422.6 16,806.6 17,167.6 17,532.4 % Ch 1.8 2.2 1.6 2.7 3.5 3.1 3.0 2.7 2.6 2.3 2.1 2.1

Price and Wage IndicatorsGDP Implicit Price Deflator, Chain Weight U.S., 2005=10 113.4 115.4 117.0 118.8 120.6 122.6 124.4 126.3 128.2 130.4 132.6 135.0

% Ch 2.1 1.8 1.4 1.6 1.5 1.6 1.5 1.5 1.5 1.7 1.7 1.8

Personal Consumption Deflator, Chain Weight U.S., 2005=100 113.8 115.8 116.9 118.4 120.2 122.2 124.2 126.2 128.3 130.6 132.9 135.3 % Ch 2.4 1.8 0.9 1.3 1.5 1.7 1.6 1.6 1.7 1.8 1.8 1.8

CPI, Urban Consumers, 1982-84=100Portland-Salem, OR-WA 224.6 229.8 232.8 236.1 240.2 244.6 249.3 253.8 258.7 263.7 268.8 274.0 % Ch 2.9 2.3 1.3 1.4 1.7 1.8 1.9 1.8 1.9 1.9 1.9 1.9 U.S. 224.9 229.6 232.7 236.1 240.2 244.7 249.0 253.5 258.1 263.2 268.3 273.5 % Ch 3.1 2.1 1.3 1.5 1.7 1.9 1.8 1.8 1.8 1.9 2.0 1.9

Oregon Average Wage Rate (Thous $) 45.6 46.8 46.8 47.8 49.0 50.3 51.8 53.2 54.7 56.4 58.2 60.3 % Ch 3.4 2.6 0.1 1.9 2.6 2.7 2.9 2.8 2.8 3.0 3.2 3.7

U.S. Average WageWage Rate (Thous $) 50.7 51.6 52.5 54.0 55.5 57.0 58.7 60.5 62.5 64.5 66.7 68.9 % Ch 2.8 1.9 1.7 2.8 2.8 2.8 2.9 3.1 3.2 3.2 3.4 3.3

Housing IndicatorsFHFA Oregon Housing Price Index 1980 Q1=100 350.9 350.2 366.9 368.5 367.6 371.2 376.6 383.1 389.2 396.5 404.4 411.9 % Ch (6.7) (0.2) 4.8 0.4 (0.2) 1.0 1.5 1.7 1.6 1.9 2.0 1.9

FHFA National Housing Price Index 1980 Q1=100 313.8 313.6 338.3 362.6 373.0 377.0 384.8 389.3 393.7 400.7 409.6 423.2 % Ch (3.6) (0.1) 7.9 7.2 2.9 1.1 2.0 1.2 1.1 1.8 2.2 3.3

Housing StartsOregon (Thous) 8.0 10.9 15.0 16.5 19.8 22.1 22.4 23.1 23.5 23.5 23.6 23.9 % Ch 5.4 35.5 38.6 9.6 20.4 11.3 1.7 3.1 1.7 0.0 0.1 1.4 U.S. (Millions) 0.6 0.8 1.0 1.2 1.6 1.6 1.6 1.6 1.6 1.6 1.6 1.5 % Ch 4.5 28.0 23.5 27.0 27.0 3.0 (0.6) 0.9 1.2 (1.2) (2.8) (1.5)

Other IndicatorsUnemployment Rate (%)Oregon 9.6 8.7 7.9 7.3 6.9 6.6 6.6 6.7 6.1 5.7 5.4 5.5 Point Change (1.1) (0.9) (0.8) (0.6) (0.5) (0.3) (0.0) 0.1 (0.5) (0.5) (0.2) 0.1 U.S. 8.9 8.1 7.6 7.2 6.6 6.0 5.7 5.5 5.3 5.3 5.3 5.3 Point Change (0.7) (0.9) (0.5) (0.4) (0.7) (0.5) (0.3) (0.2) (0.1) (0.1) (0.0) 0.0

Industrial Production IndexU.S, 2002 = 100 93.6 97.0 99.5 102.8 106.7 110.0 113.1 116.2 119.4 122.3 125.2 128.0 % Ch 3.4 3.6 2.5 3.3 3.8 3.1 2.8 2.8 2.8 2.4 2.3 2.2

Prime Rate (Percent) 3.3 3.3 3.3 3.3 3.4 5.2 6.8 7.0 7.0 7.0 7.0 7.0 % Ch 0.0 0.0 0.0 0.0 5.3 50.7 32.5 2.5 0.0 0.0 0.0 0.0

Population (Millions)Oregon 3.86 3.89 3.92 3.96 4.01 4.06 4.11 4.16 4.21 4.26 4.31 4.37 % Ch 0.6 0.7 0.9 1.0 1.1 1.2 1.2 1.2 1.2 1.2 1.3 1.3 U.S. 312.3 314.6 317.0 319.5 321.9 324.4 326.9 329.4 332.0 334.5 337.0 339.5 % Ch 0.7 0.7 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.7

Timber Harvest (Mil Bd Ft)Oregon 3,649.0 3,595.0 3,523.0 3,776.1 4,134.7 4,202.9 4,294.8 4,375.0 4,449.2 4,482.8 4,503.9 4,540.9 % Ch 13.1 (1.5) (2.0) 7.2 9.5 1.7 2.2 1.9 1.7 0.8 0.5 0.8

39

APPENDIX B: REVENUE FORECAST DETAIL

Table B.1a General Fund Revenue Statement – 2011-13 …………………………………………… 40

Table B.1b General Fund Revenue Statement 2013-15 – Close of Session ………………………… 41

Table B.1c General Fund Revenue Statement – 2013-15 …………………………………………… 42

Table B.2 General Fund Revenue Forecast by Fiscal Year ………………………………………… 43

Table B.3 Summary of 2013 Legislative Session Adjustments ………………………………………. 44

Table B.4 Oregon Personal Income Tax Revenue Forecast ……………………………………….. 45

Table B.5 Oregon Corporate Income Tax Revenue Forecast ………………………………………. 47

Table B.6 Cigarette and Tobacco Tax Distribution …………………………………………………… 49

Table B.7 Revenue Distribution to Local Governments ……………………………………………… 50

Table B.8 Track Record for the May 2013 Forecast ………………………………………………….. 51

Table B.9 Summary of Lottery Resources …………………………………………………………..... 52

Table B.10 Budgetary Reserve Summary and Outlook ………………………………………………... 53

40

Table B.1 General Fund Revenue Statement - 2011-13

Tabl

e B.

1aGe

nera

l Fun

d Re

venu

e St

atem

ent -

- 201

1-13

Tota

lTo

tal

2011

-12

2012

-13

2011

-13

2011

-12

2012

-13

2011

-13

Taxe

s Pe

rsona

l Inco

me T

axes

(Befo

re K

icker

)12

,193,5

53,00

05,

852,

884,

000

6,29

9,79

7,00

012

,152

,681

,000

5,85

0,57

6,00

06,

267,

611,

000

12,1

18,1

87,0

00(3

4,494

,000)

(75,3

66,00

0)Of

fsets

and T

rans

fers

00

(11,

965,

000)

(11,

965,

000)

0(1

1,96

5,00

0)(1

1,96

5,00

0)0

(11,9

65,00

0)Co

rpor

ate In

com

e Tax

es (B

efore

Kick

er)

894,2

43,00

043

0,98

9,00

048

3,60

1,00

091

4,59

0,00

043

1,02

4,00

045

2,88

8,00

088

3,91

2,00

0(3

0,678

,000)

(10,3

31,00

0)Of

fsets

and T

rans

fers

00

00

00

00

0Ins

uran

ce T

axes

10

0,258

,000

47,4

76,0

0049

,932

,000

97,4

08,0

0049

,414

,000

47,2

72,0

0096

,686

,000

(722

,000)

(3,57

2,000

)Es

tate T

axes

190,2

84,00

010

1,76

6,00

010

7,37

2,00

020

9,13

8,00

010

1,76

6,00

010

1,86

3,00

020

3,62

9,00

0(5

,509,0

00)

13,34

5,000

Ciga

rette

Tax

es

74,24

4,000

37,9

38,0

0036

,352

,000

74,2

90,0

0037

,938

,000

37,0

18,0

0074

,956

,000

666,0

0071

2,000

Othe

r Tob

acco

Pro

ducts

Tax

es58

,586,0

0028

,087

,000

30,5

28,0

0058

,615

,000

28,0

87,0

0030

,522

,000

58,6

09,0

00(6

,000)

23,00

0Ot

her T

axes

1,3

27,00

01,

507,

000

656,

000

2,16

3,00

01,

507,

000

656,

000

2,16

3,00

00

836,0

00

Fine

s and

Fee

sSt

ate C

ourt F

ees

88,23

7,000

68,8

42,0

0070

,665

,000

139,

507,

000

67,8

56,0

0071

,641

,000

139,

497,

000

(10,0

00)

51,26

0,000

Secr

etary

of St

ate F

ees

47,03

9,000

26,5

15,0

0025

,710

,000

52,2

25,0

0026

,515

,000

25,9

13,0

0052

,428

,000

203,0

005,3

89,00

0Cr

imina

l Fine

s & As

sess

men

ts80

,598,0

0039

,899

,000

33,7

61,0

0073

,660

,000

41,1

49,0

0034

,818

,000

75,9

67,0

002,3

07,00

0(4

,631,0

00)

Secu

rities

Fee

s19

,070,0

009,

419,

000

10,6

96,0

0020

,115

,000

9,41

9,00

010

,723

,000

20,1

42,0

0027

,000

1,072

,000

Cent

ral S

ervi

ce C

harg

es11

,152,0

005,

576,

000

5,57

6,00

011

,152

,000

5,97

6,00

05,

620,

000

11,5

96,0

0044

4,000

444,0

00

Liqu

or A

ppor

tionm

ent

187,3

88,00

011

0,20

0,00

011

8,14

4,00

022

8,34

4,00

011

0,20

0,00

011

5,36

4,00

022

5,56

4,00

0(2

,780,0

00)

38,17

6,000

Inte

rest

Ear

ning

s9,9

13,00

09,

838,

000

3,05

3,00

012

,891

,000

9,83

8,00

06,

294,

000

16,1

32,0

003,2

41,00

06,2

19,00

0

Mis

cella

neou

s Rev

enue

s15

,800,0

004,

897,

000

5,00

0,00

09,

897,

000

4,28

8,00

03,

745,

000

8,03

3,00

0(1

,864,0

00)

(7,76

7,000

)

One-

time T

rans

fers

60,30

0,000

164,

806,

000

26,9

89,0

0019

1,79

5,00

017

1,35

8,00

019

,039

,000

190,

397,

000

(1,39

8,000

)13

0,097

,000

Gros

s Gen

eral

Fun

d Re

venu

es14

,031,9

92,00

06,

940,

639,

000

7,30

7,83

2,00

014

,248

,471

,000

6,94

6,91

1,00

07,

230,

987,

000

14,1

77,8

98,0

00(7

0,573

,000)

145,9

06,00

0

Offse

ts an

d Tra

nsfer

s Tota

l0

0(1

1,965

,000)

(11,9

65,00

0)0

(11,9

65,00

0)(1

1,965

,000)

0(1

1,965

,000)

Net G

ener

al F

und

Reve

nues

14,03

1,992

,000

6,94

0,63

9,00

07,

295,

867,

000

14,2

36,5

06,0

006,

946,

911,

000

7,21

9,02

2,00

014

,165

,933

,000

(70,5

73,00

0)13

3,941

,000

Plus

Beg

inning

Bala

nce

00

00

0

Less

Antic

ipated

Adm

inistr

ative

Actio

ns*

(23,1

35,60

0)(4

,395,0

00)

(4,39

5,000

)0

18,74

0,600

Plus

Legis

lative

ly Ad

opted

Actio

ns**

00

00

Avai

labl

e Res

ourc

es14

,008,8

56,40

014

,232

,111

,000

14,1

61,5

38,0

00(7

0,573

,000)

152,6

81,60

0

Legis

lative

ly Ad

opted

Bud

get

13,56

2,594

,263

13,7

34,9

47,6

6213

,688

,613

,608

(46,3

34,05

4)12

6,019

,345

Plus

Adm

inistr

ative

Actio

ns0

00

0

Proj

ecte

d Ex

pend

iture

s13

,562,5

94,26

313

,734

,947

,662

13,6

88,6

13,6

08(4

6,334

,054)

126,0

19,34

5

Estim

ated

End

ing

Bala

nce

446,2

62,13

749

7,16

3,33

847

2,92

4,39

2(2

4,238

,946)

26,66

2,255

Notes

: C

orpo

rate

incom

e tax

figur

e inc

ludes

Cor

pora

te M

ultist

ate ta

xes.

O

ther ta

xes i

nclud

e Gen

eral

Fund

portio

ns of

the E

aster

n Ore

gon S

ever

ance

Tax

, Wes

tern O

rego

n Sev

eran

ce T

ax an

d Am

usem

ent D

evice

Tax

.

Ciga

rette

and O

ther T

obac

co T

axes

are g

ross

tax r

eceip

ts. D

istrib

ution

s, ne

t of a

dmini

strati

ve co

sts, a

re re

porte

d in t

he T

able

B.6.

D

etaile

d entr

ies m

ay no

t add

to to

tals d

ue to

roun

ding.

*

Adm

inistr

ative

Actio

ns eq

ual e

xpen

ses a

ssoc

iated

with

cash

flow

man

agem

ent, e

xclus

ive of

inter

nal b

orro

wing

.

Estim

ate a

t CO

S 20

11

Fore

cast

s Dat

ed: 5

/16/20

13Fo

reca

sts D

ated

: 9/1/

2013

Diffe

renc

e09

/1/20

13 L

ess

5/16/2

013

09/1/

2013

Les

s CO

S

41

Gen

eral

Fun

d R

even

ue S

tate

men

t -- 2

013-

15 -

Clo

se o

f Ses

sion

Tot

alT

otal

2013

-14

2014

-15

2013

-15

2013

-14

2014

-15

2013

-15

Tax

es

Pers

onal

Inco

me

Taxe

s (B

efor

e K

icke

r)6,

515,

713,

000

7,06

3,75

9,00

013

,579

,472

,000

6,50

5,06

3,00

07,

053,

109,

000

13,5

58,1

72,0

00(2

1,30

0,00

0)O

ffse

ts a

nd T

rans

fers

(24,

142,

000)

(33,

400,

000)

(57,

542,

000)

(24,

142,

000)

(33,

400,

000)

(57,

542,

000)

0C

orpo

rate

Inco

me

Taxe

s (B

efor

e K

icke

r)50

0,30

6,00

053

6,26

4,00

01,

036,

570,

000

510,

306,

000

546,

264,

000

1,05

6,57

0,00

020

,000

,000

Off

sets

and

Tra

nsfe

rs(2

7,29

6,00

0)(3

6,00

2,00

0)(6

3,29

8,00

0)(2

7,29

6,00

0)(3

6,00

2,00

0)(6

3,29

8,00

0)0

Insu

ranc

e Ta

xes

52,1

12,0

0056

,542

,000

108,

654,

000

51,8

12,0

0055

,942

,000

107,

754,

000

(900

,000

)Es

tate

Tax

es10

1,89

1,00

010

6,09

1,00

020

7,98

2,00

010

1,89

1,00

010

6,09

1,00

020

7,98

2,00

00

Cig

aret

te T

axes

35

,272

,000

33,7

77,0

0069

,049

,000

35,2

72,0

0033

,777

,000

69,0

49,0

000

Oth

er T

obac

co P

rodu

cts

Taxe

s29

,273

,000

30,0

93,0

0059

,366

,000

29,2

73,0

0030

,093

,000

59,3

66,0

000

Oth

er T

axes

63

6,00

062

6,00

01,

262,

000

636,

000

626,

000

1,26

2,00

00

Fine

s an

d Fe

esSt

ate

Cou

rt Fe

es

71,4

74,0

0072

,345

,000

143,

819,

000

71,4

74,0

0072

,345

,000

143,

819,

000

0Se

cret

ary

of S

tate

Fee

s25

,550

,000

25,4

81,0

0051

,031

,000

27,5

50,0

0027

,481

,000

55,0

31,0

004,

000,

000

Crim

inal

Fin

es &

Ass

essm

ents

30,2

13,0

0025

,565

,000

55,7

78,0

0025

,613

,000

20,9

65,0

0046

,578

,000

(9,2

00,0

00)

Secu

ritie

s Fe

es10

,024

,000

10,2

20,0

0020

,244

,000

10,0

24,0

0010

,220

,000

20,2

44,0

000

Cen

tral

Ser

vice

Cha

rges

5,57

6,00

05,

576,

000

11,1

52,0

004,

076,

000

4,07

6,00

08,

152,

000

(3,0

00,0

00)

Liq

uor

App

ortio

nmen

t11

5,96

3,00

012

0,69

6,00

023

6,65

9,00

012

2,97

0,00

012

7,98

9,00

025

0,95

9,00

014

,300

,000

Inte

rest

Ear

ning

s4,

316,

000

5,64

5,00

09,

961,

000

4,31

6,00

05,

645,

000

9,96

1,00

00

Mis

cella

neou

s R

even

ues

7,50

0,00

08,

000,

000

15,5

00,0

007,

500,

000

8,00

0,00

015

,500

,000

0

One

-tim

e T

rans

fers

00

032

,200

,000

032

,200

,000

32,2

00,0

00

Gro

ss G

ener

al F

und

Rev

enue

s7,

505,

819,

000

8,10

0,68

0,00

015

,606

,499

,000

7,53

9,97

6,00

08,

102,

623,

000

15,6

42,5

99,0

0036

,100

,000

Off

set a

nd T

rans

fers

(51,

438,

000)

(69,

402,

000)

(120

,840

,000

)(5

1,43

8,00

0)(6

9,40

2,00

0)(1

20,8

40,0

00)

0

Net

Gen

eral

Fun

d R

even

ues

7,45

4,38

1,00

08,

031,

278,

000

15,4

85,6

59,0

007,

488,

538,

000

8,03

3,22

1,00

015

,521

,759

,000

36,1

00,0

00

Plus

Beg

inni

ng B

alan

ce49

7,16

3,33

854

3,49

7,39

246

,334

,054

Less

Ant

icip

ated

Adm

inist

rativ

e A

ctio

ns*

(18,

222,

166)

(18,

222,

166)

0

Less

Leg

islat

ivel

y A

dopt

ed A

ctio

ns**

(137

,349

,477

)(1

36,8

86,1

36)

463,

341

Ava

ilabl

e R

esou

rces

15,8

27,2

50,6

9515

,910

,148

,090

82,8

97,3

95

Legi

slativ

ely

Ado

pted

Bud

get

NA

15,6

08,6

70,2

98N

A

Proj

ecte

d E

xpen

ditu

res

NA

15,6

08,6

70,2

98N

A

Est

imat

ed E

ndin

g B

alan

ceN

A30

1,47

7,79

2N

A

CO

S L

ess

5/16

/201

3

Tab

le B

.1b

Fore

cast

s D

ated

: 5/1

6/20

13Fo

reca

sts

Dat

ed: C

OS

Diff

eren

ce

42

Tabl

e B.

1cGe

nera

l Fun

d Re

venu

e St

atem

ent -

- 201

3-15

Tota

lTo

tal

2013

-14

2014

-15

2013

-15

2013

-14

2014

-15

2013

-15

Taxe

s Pe

rsona

l Inco

me T

axes

(Befo

re K

icker

)13

,558,1

72,00

06,

515,

713,

000

7,06

3,75

9,00

013

,579

,472

,000

6,53

5,37

7,00

07,

068,

127,

000

13,6

03,5

04,0

0024

,032,0

0045

,332,0

00Of

fsets

and T

rans

fers

(57,5

42,00

0)(2

4,14

2,00

0)(3

3,40

0,00

0)(5

7,54

2,00

0)(2

4,14

2,00

0)(3

3,40

0,00

0)(5

7,54

2,00

0)0

0Co

rpor

ate In

com

e Tax

es (B

efore

Kick

er)

1,056

,570,0

0050

0,30

6,00

053

6,26

4,00

01,

036,

570,

000

488,

343,

000

523,

693,

000

1,01

2,03

6,00

0(2

4,534

,000)

(44,5

34,00

0)Of

fsets

and T

rans

fers

(63,2

98,00

0)(2

7,29

6,00

0)(3

6,00

2,00

0)(6

3,29

8,00

0)(2

0,89

0,00

0)(2

1,85

6,00

0)(4

2,74

6,00

0)20

,552,0

0020

,552,0

00Ins

uran

ce T

axes

10

7,754

,000

52,1

12,0

0056

,542

,000

108,

654,

000

51,3

24,0

0056

,215

,000

107,

539,

000

(1,11

5,000

)(2

15,00

0)Es

tate T

axes

207,9

82,00

010

1,89

1,00

010

6,09

1,00

020

7,98

2,00

010

4,09

1,00

010

8,87

1,00

021

2,96

2,00

04,9

80,00

04,9

80,00

0Ci

gare

tte T

axes

69

,049,0

0035

,272

,000

33,7

77,0

0069

,049

,000

35,2

72,0

0033

,777

,000

69,0

49,0

000

0Ot

her T

obac

co P

rodu

cts T

axes

59,36

6,000

29,2

73,0

0030

,093

,000

59,3

66,0

0029

,273

,000

30,0

93,0

0059

,366

,000

00

Othe

r Tax

es

1,262

,000

636,

000

626,

000

1,26

2,00

063

6,00

062

6,00

01,

262,

000

00

Fine

s and

Fee

sSt

ate C

ourt F

ees

143,8

19,00

071

,474

,000

72,3

45,0

0014

3,81

9,00

071

,474

,000

72,3

45,0

0014

3,81

9,00

00

0Se

creta

ry of

State

Fee

s55

,031,0

0025

,550

,000

25,4

81,0

0051

,031

,000

27,5

50,0

0027

,481

,000

55,0

31,0

004,0

00,00

00

Crim

inal F

ines &

Asse

ssm

ents

46,57

8,000

30,2

13,0

0025

,565

,000

55,7

78,0

0024

,646

,000

20,8

55,0

0045

,501

,000

(10,2

77,00

0)(1

,077,0

00)

Secu

rities

Fee

s20

,244,0

0010

,024

,000

10,2

20,0

0020

,244

,000

10,4

11,0

0010

,312

,000

20,7

23,0

0047

9,000

479,0

00

Cent

ral S

ervi

ce C

harg

es8,1

52,00

05,

576,

000

5,57

6,00

011

,152

,000

4,07

6,00

04,

076,

000

8,15

2,00

0(3

,000,0

00)

0

Liqu

or A

ppor

tionm

ent

250,9

59,00

011

5,96

3,00

012

0,69

6,00

023

6,65

9,00

012

4,55

1,00

012

7,06

7,00

025

1,61

8,00

014

,959,0

0065

9,000

Inte

rest

Ear

ning

s9,9

61,00

04,

316,

000

5,64

5,00

09,

961,

000

4,31

6,00

05,

645,

000

9,96

1,00

00

0

Mis

cella

neou

s Rev

enue

s15

,500,0

007,

500,

000

8,00

0,00

015

,500

,000

7,50

0,00

08,

000,

000

15,5

00,0

000

0

One-

time T

rans

fers

32,20

0,000

00

032

,200

,000

032

,200

,000

32,20

0,000

0

Gros

s Gen

eral

Fun

d Re

venu

es15

,642,5

99,00

07,

505,

819,

000

8,10

0,68

0,00

015

,606

,499

,000

7,55

1,04

0,00

08,

097,

183,

000

15,6

48,2

23,0

0041

,724,0

005,6

24,00

0

Offse

ts an

d Tra

nsfer

s Tota

l(1

20,84

0,000

)(5

1,438

,000)

(69,4

02,00

0)(1

20,84

0,000

)(4

5,032

,000)

(55,2

56,00

0)(1

00,28

8,000

)20

,552,0

0020

,552,0

00

Net G

ener

al F

und

Reve

nues

15,52

1,759

,000

7,45

4,38

1,00

08,

031,

278,

000

15,4

85,6

59,0

007,

506,

008,

000

8,04

1,92

7,00

015

,547

,935

,000

62,27

6,000

26,17

6,000

Plus

Beg

inning

Bala

nce

543,4

97,39

249

7,16

3,33

847

2,92

4,39

2(2

4,238

,946)

(70,5

73,00

0)

Less

Antic

ipated

Adm

inistr

ative

Actio

ns*

(18,2

22,16

6)(1

8,222

,166)

(13,5

51,00

0)4,6

71,16

64,6

71,16

6

Plus

Legis

lative

ly Ad

opted

Actio

ns**

(136

,886,1

36)

(137

,349

,477

)(1

36,8

86,1

36)

463,3

410

Avai

labl

e Res

ourc

es15

,910,1

48,09

015

,827

,250

,695

15,8

70,4

22,2

5643

,171,5

61(3

9,725

,834)

Legis

lative

ly Ad

opted

Bud

get

15,60

8,670

,298

15,6

29,4

10,0

6215

,608

,670

,298

(20,7

39,76

4)0

0Pl

us Ad

mini

strati

ve Ac

tions

0NA

0

Proj

ecte

d Ex

pend

iture

s15

,608,6

70,29

815

,629

,410

,062

15,6

08,6

70,2

98NA

0

Estim

ated

End

ing

Bala

nce

301,4

77,79

219

7,84

0,63

426

1,75

1,95

8NA

(39,7

25,83

4)No

tes:

Cor

pora

te inc

ome t

ax fig

ure i

nclud

es C

orpo

rate

Mult

istate

taxe

s.

Othe

r taxe

s inc

lude G

ener

al Fu

nd po

rtions

of th

e Eas

tern O

rego

n Sev

eran

ce T

ax, W

ester

n Ore

gon S

ever

ance

Tax

and A

mus

emen

t Dev

ice T

ax.

C

igare

tte an

d Othe

r Tob

acco

Tax

es ar

e gro

ss ta

x rec

eipts.

Dist

ributi

ons,

net o

f adm

inistr

ative

costs

, are

repo

rted i

n the

Tab

le B.

6.

Deta

iled e

ntries

may

not a

dd to

total

s due

to ro

undin

g.

* Ad

mini

strati

ve Ac

tions

equa

l exp

ense

s ass

ociat

ed w

ith ca

shflo

w m

anag

emen

t, exc

lusive

of in

terna

l bor

rowi

ng.

Estim

ate a

t CO

S 20

13

Fore

cast

s Dat

ed: 5

/16/20

13Fo

reca

sts D

ated

: 9/1/

2013

Diffe

renc

e09

/1/20

13 L

ess

5/16/2

013

09/1/

2013

Les

s CO

S

43

Table B.2 General Fund Revenue Forecast by Fiscal Year 1

Fisc

al Y

ears

2011

-12

Fisc

al Y

ear

2012

-13

Fisc

al Y

ear

2013

-14

Fisc

al Y

ear

2014

-15

Fisc

al Y

ear

2015

-16

Fisc

al Y

ear

2016

-17

Fisc

al Y

ear

2017

-18

Fisc

al Y

ear

2018

-19

Fisc

al Y

ear

2019

-20

Fisc

al Y

ear

2020

-21

Fisc

al Y

ear

2021

-22

Fisc

al Y

ear

2022

-23

Fisc

al Y

ear

Tax

es

Pers

onal

Inco

me

5,85

0.6

6,26

7.6

6,53

5.4

7,06

8.1

7,47

4.3

7,84

9.0

8,21

0.8

8,58

2.6

9,00

4.1

9,45

4.6

9,91

8.3

10,4

61.9

Off

sets

and

Tra

nsfe

rs0.

0(1

2.0)

(24.

1)(3

3.4)

(36.

9)(3

8.7)

(40.

5)0.

00.

00.

00.

00.

0C

orpo

rate

Exc

ise

& In

com

e43

1.0

452.

948

8.3

523.

751

9.1

509.

750

3.3

500.

150

7.5

526.

655

6.6

570.

7O

ffse

ts a

nd T

rans

fers

0.0

0.0

(20.

9)(2

1.9)

(20.

9)(2

1.0)

(21.

3)(2

1.7)

(22.

6)(2

3.4)

(24.

2)(2

4.5)

Insu

ranc

e 49

.447

.351

.356

.257

.960

.563

.065

.367

.368

.870

.071

.7Es

tate

101.

810

1.9

104.

110

8.9

115.

112

2.1

127.

113

5.3

141.

814

9.6

156.

916

4.6

Cig

aret

te

37.9

37.0

35.3

33.8

32.3

30.3

29.0

27.7

26.4

25.2

24.1

23.0

Oth

er T

obac

co P

rodu

cts

28.1

30.5

29.3

30.1

30.9

31.8

32.7

33.6

34.5

35.5

36.5

37.5

Oth

er T

axes

1.5

0.7

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

Oth

er R

even

ues

Lice

nses

and

Fee

s14

4.9

143.

113

4.1

131.

013

5.2

132.

713

7.2

134.

713

9.5

137.

214

1.0

138.

8C

harg

es fo

r Ser

vice

s 6.

05.

64.

14.

14.

14.

14.

14.

14.

14.

14.

14.

1Li

quor

App

ortio

nmen

t11

0.2

115.

412

4.6

127.

111

4.5

117.

912

1.5

125.

112

8.9

132.

713

6.7

140.

8In

tere

st E

arni

ngs

9.8

6.3

4.3

5.6

7.0

8.0

11.8

17.5

24.4

32.7

35.0

38.0

Oth

ers

175.

622

.839

.78.

08.

28.

48.

48.

48.

48.

48.

48.

4

Gro

ss G

ener

al F

und

6,94

6.9

7,23

1.0

7,55

1.0

8,09

7.2

8,49

9.2

8,87

5.0

9,24

9.5

9,63

5.1

10,0

87.5

10,5

76.2

11,0

88.1

11,6

60.2

Net

Gen

eral

Fun

d6,

946.

97,

219.

07,

506.

08,

041.

98,

441.

38,

815.

39,

187.

79,

613.

310

,064

.910

,552

.811

,063

.911

,635

.7

Bie

nnia

l Tot

als

2011

-13

Bie

nniu

mPe

rcen

t C

hang

e20

13-1

5 B

ienn

ium

Perc

ent

Cha

nge

2015

-17

Bie

nniu

mPe

rcen

t C

hang

e20

17-1

9 B

ienn

ium

Perc

ent

Cha

nge

2019

-21

Bie

nniu

mPe

rcen

t C

hang

e20

21-2

3 B

ienn

ium

Perc

ent

Cha

nge

Tax

es

Pers

onal

Inco

me

12,1

18.2

15.8

%13

,603

.512

.3%

15,3

23.2

12.6

%16

,793

.59.

6%18

,458

.79.

9%20

,380

.210

.4%

Cor

pora

te E

xcis

e &

Inco

me

883.

96.

8%1,

012.

014

.5%

1,02

8.8

1.7%

1,00

3.4

-2.5

%1,

034.

13.

1%1,

127.

39.

0%In

sura

nce

96.7

6.9%

107.

511

.2%

118.

410

.1%

128.

38.

4%13

6.2

6.1%

141.

74.

1%Es

tate

Tax

es20

3.6

20.6

%21

3.0

4.6%

237.

111

.3%

262.

410

.6%

291.

411

.1%

321.

410

.3%

Cig

aret

te

75.0

-2.4

%69

.0-7

.9%

62.6

-9.3

%56

.7-9

.6%

51.7

-8.8

%47

.1-8

.8%

Oth

er T

obac

co P

rodu

cts

58.6

23.8

%59

.41.

3%62

.75.

7%66

.35.

7%70

.15.

7%74

.05.

7%O

ther

Tax

es2.

2-1

3.3%

1.3

-41.

7%1.

2-2

.0%

1.2

-0.4

%1.

20.

0%1.

20.

0%

Oth

er R

even

ues

Lice

nses

and

Fee

s28

8.0

68.3

%26

5.1

-8.0

%26

7.9

1.1%

271.

91.

5%27

6.7

1.8%

279.

81.

1%C

harg

es fo

r Ser

vice

s 11

.641

.9%

8.2

-29.

7%8.

20.

0%8.

20.

0%8.

20.

0%8.

20.

0%Li

quor

App

ortio

nmen

t22

5.6

13.8

%25

1.6

11.6

%23

2.4

-7.6

%24

6.6

6.1%

261.

66.

1%27

7.5

6.1%

Inte

rest

Ear

ning

s16

.124

5.3%

10.0

-38.

3%14

.950

.0%

29.3

95.9

%57

.195

.1%

73.0

27.8

%O

ther

s19

8.4

-56.

7%47

.7-7

6.0%

16.6

-65.

2%16

.81.

2%16

.80.

0%16

.80.

0%

Gro

ss G

ener

al F

und

14,1

77.9

13.2

%15

,648

.210

.4%

17,3

74.1

11.0

%18

,884

.58.

7%20

,663

.79.

4%22

,748

.310

.1%

Net

Gen

eral

Fun

d14

,165

.913

.1%

15,5

47.9

9.8%

17,2

56.6

11.0

%18

,801

.08.

9%20

,617

.89.

7%22

,699

.610

.1%

Sept

embe

r 20

13($

Milli

ons)

Gen

eral

Fun

d R

even

ue F

orec

ast

Not

e: T

otal

s m

ay n

ot s

um d

ue to

roun

ding

. Oth

er ta

xes

incl

ude

East

ern

and

Wes

tern

Ore

gon

Seve

ranc

e T

axes

and

Am

usem

ent D

evic

e T

ax. O

ther

reve

nues

incl

ude

Com

mer

cial

Fis

h Li

cens

es &

Fee

s an

d Pa

ri-m

utua

l Rec

eipt

s.

44

Table B.3 Summary of 2013 Legislative Session Adjustments Biennia Staff

Measure Summary

Revenue Impact

Statement 13-15 15-17 17-19 19-21 21-23

Personal Income Tax Impacts (Millions) 1099 Penalties – HB 2464 $0.8 $1.1 $1.2 $1.3 $1.4 HB 2464 HB 2464 Federal Reconnect – HB 2494 -$0.7 $0.4 $0.00 $0.00 $0.00 HB 2492 HB 2492 DOR Enforcement – SB 5538 $33.1 $0.0 $0.0 $0.0 $0.0 SB 5538 Tax Credits - HB 3367 HB 3367 HB 3367 Earned Income -$42.2 -$75.2 -$75.8 -$37.5 $0.0 Medical Deduction $3.0 $5.0 $6.0 $8.0 $10.0 Married-Filing Separate $4.0 $5.0 $5.0 $6.0 $6.0 Political Contributions -$6.3 -$15.5 -$13.7 -$5.6 $0.0 Cultural Trust -$3.3 -$6.6 -$6.8 -$3.4 $0.0 Pension Income -$0.9 -$1.7 -$1.7 -$0.9 $0.0 Rural Medical Provider -$1.0 -$3.6 -$2.9 -$2.3 -$1.9 Rural EMT -$0.2 -$0.3 -$0.3 -$0.2 $0.0 Employer Provider Scholar. $0.0 -$0.1 -$0.1 $0.0 $0.0 Farmworkers Housing $0.0 -$0.1 -$0.2 -$0.3 -$0.2 Mobile Home Closure $0.0 -$0.1 -$0.1 $0.0 $0.0 Mobile Home Gains $0.0 -$0.1 -$0.1 $0.0 $0.0 Film & Video Credit -$7.6 $-7.6 -$3.8 $0.0 $0.0 Personal Income Tax Total -$21.3 -$100.2 -$93.3 -$34.9 $15.3

Corporate Income Tax Impacts (Millions) Out of State Banks – HB 3477 $1.0 $1.0 $1.0 $1.0 $1.0 HB 3477 HB 3477 1099 Penalties – HB 2464 $0.2 $0.1 $0.1 $0.1 $0.1 HB 2464 HB 2464 Tax Havens – HB 2460 $18.0 $42.0 $49.0 $51.0 $55.0 HB 2460 HB 2460 Fire Insurance – HB 2084 -$1.4 -$2.0 -$2.2 -$2.3 -$2.4 HB 2084 HB 2084 Tax Credits - HB 3367 HB 3367 HB 3367 Farmworkers Housing. -$0.2 -$0.5 -$0.7 -$0.9 -$0.8 Sunset Workers Comp $1.5 $3.0 $3.0 $3.0 $3.0 Corporate Income Tax Total $19.1 $43.6 $50.2 $51.9 $55.9

Other Tax/Revenue Impacts (Millions) Program Change Bill – HB 2322 $47.5 $0.0 $0.0 $0.0 $0.0 HB 2322 HB 2322 Criminal Fines – HB 2562 -$9.2 -$9.4 -$9.6 -$9.8 -$10.0 HB 2562 HB 2562 Other Tax Total $38.3 -$9.4 -$9.6 -$9.8 -$10.0

45

Table B.4 Oregon Personal Income Tax Revenue Forecast

TABLE B.4

2005:3 2005:4 2006:1 2006:2 FY 2006 2006:3 2006:4 2007:1 2007:2 FY 2007

WITHHOLDING 1,064,107 1,087,942 1,177,488 1,075,476 4,405,013 1,118,878 1,172,656 1,182,336 1,088,108 4,561,977 %CHYA 8.4% 6.4% 10.5% 6.0% 7.8% 5.1% 7.8% 0.4% 1.2% 3.6%

EST. PAYMENTS 194,848 186,648 224,403 270,754 876,653 231,720 177,026 267,345 363,055 1,039,146 %CHYA 22.4% 36.4% 11.4% 0.3% 14.2% 18.9% -5.2% 19.1% 34.1% 18.5%

FINAL PAYMENTS 51,797 68,000 88,998 787,622 996,416 55,408 89,432 100,476 779,577 1,024,893 %CHYA 16.8% 27.6% 13.8% 49.4% 41.7% 7.0% 31.5% 12.9% -1.0% 2.9%

REFUNDS 62,638 94,755 345,524 358,699 861,617 89,254 126,707 444,768 369,456 1,030,186 %CHYA -9.4% 17.8% 0.7% -1.4% 0.6% 42.5% 33.7% 28.7% 3.0% 19.6%

OTHER (149,733) - - 176,911 27,178 (176,911) - - 177,781 870 TOTAL 1,098,381 1,247,835 1,145,365 1,952,063 5,443,644 1,139,841 1,312,406 1,105,388 2,039,066 5,596,701 %CHYA 10.9% 10.2% 14.3% 22.2% 15.3% 3.8% 5.2% -3.5% 4.5% 2.8%

2007:3 2007:4 2008:1 2008:2 FY 2008 2008:3 2008:4 2009:1 2009:2 FY 2009

WITHHOLDING 1,115,359 1,200,822 1,196,532 1,111,034 4,623,747 1,162,107 1,182,763 1,128,994 1,089,305 4,563,169 %CHYA -0.3% 2.4% 1.2% 2.1% 1.4% 4.2% -1.5% -5.6% -2.0% -1.3%

EST. PAYMENTS 250,749 217,163 281,441 399,475 1,148,828 264,440 174,826 217,305 263,135 919,707 %CHYA 8.2% 22.7% 5.3% 10.0% 10.6% 5.5% -19.5% -22.8% -34.1% -19.9%

FINAL PAYMENTS 57,503 129,817 104,841 971,325 1,263,486 70,306 99,430 104,105 529,995 803,836 %CHYA 3.8% 45.2% 4.3% 24.6% 23.3% 22.3% -23.4% -0.7% -45.4% -36.4%

REFUNDS 71,372 155,912 389,876 365,908 983,068 92,063 180,329 447,706 404,229 1,124,327 %CHYA -20.0% 23.0% -12.3% -1.0% -4.6% 29.0% 15.7% 14.8% 10.5% 14.4%

OTHER (177,781) (1,084,201) - 182,322 (1,079,660) (182,322) - - 138,521 (43,801) TOTAL 1,174,457 307,689 1,192,938 2,298,247 4,973,332 1,222,469 1,276,690 1,002,698 1,616,726 5,118,583 %CHYA 3.0% -76.6% 7.9% 12.7% -11.1% 4.1% 314.9% -15.9% -29.7% 2.9%

2009:3 2009:4 2010:1 2010:2 FY 2010 2010:3 2010:4 2011:1 2011:2 FY 2011

WITHHOLDING 1,092,795 1,151,673 1,157,857 1,116,552 4,518,878 1,146,189 1,196,214 1,262,781 1,218,439 4,823,622 %CHYA -6.0% -2.6% 2.6% 2.5% -1.0% 4.9% 3.9% 9.1% 9.1% 6.7%

EST. PAYMENTS 176,110 161,759 186,894 265,703 790,467 179,692 148,589 207,036 284,662 819,978 %CHYA -33.4% -7.5% -14.0% 1.0% -14.1% 2.0% -8.1% 10.8% 7.1% 3.7%

FINAL PAYMENTS 63,363 77,013 105,745 515,262 761,383 62,259 81,728 114,877 607,592 866,456 %CHYA -9.9% -22.5% 1.6% -2.8% -5.3% -1.7% 6.1% 8.6% 17.9% 13.8%

REFUNDS 96,477 188,704 459,550 380,459 1,125,190 92,291 151,515 432,478 340,652 1,016,937 %CHYA 4.8% 4.6% 2.6% -5.9% 0.1% -4.3% -19.7% -5.9% -10.5% -9.6%

OTHER (138,521) - - 136,193 (2,328) (136,193) - - 165,933 29,740 TOTAL 1,097,271 1,201,740 990,947 1,653,251 4,943,210 1,159,655 1,275,015 1,152,216 1,935,973 5,522,860 %CHYA -10.2% -5.9% -1.2% 2.3% -3.4% 5.7% 6.1% 16.3% 17.1% 11.7%

2011:3 2011:4 2012:1 2012:2 FY 2012 2012:3 2012:4 2013:1 2013:2 FY 2013

WITHHOLDING 1,235,508 1,287,030 1,348,171 1,269,562 5,140,271 1,262,589 1,364,547 1,354,116 1,321,413 5,302,666 %CHYA 7.8% 7.6% 6.8% 4.2% 6.6% 2.2% 6.0% 0.4% 4.1% 3.2%

EST. PAYMENTS 194,674 185,239 199,238 299,646 878,797 205,533 159,104 278,341 321,896 964,874 %CHYA 8.3% 24.7% -3.8% 5.3% 7.2% 5.6% -14.1% 39.7% 7.4% 9.8%

FINAL PAYMENTS1 85,889 87,233 117,628 627,762 918,512 72,224 91,338 123,456 785,542 1,072,560 %CHYA 38.0% 6.7% 2.4% 3.3% 6.0% -15.9% 4.7% 5.0% 25.1% 16.8%

REFUNDS 64,687 156,272 530,800 360,618 1,112,377 52,211 109,503 536,506 383,176 1,081,397 %CHYA -29.9% 3.1% 22.7% 5.9% 9.4% -19.3% -29.9% 1.1% 6.3% -2.8%

OTHER (165,933) - - 193,614 27,681 (193,614) - - 201,367 7,753 TOTAL 1,285,451 1,403,230 1,134,237 2,029,966 5,852,884 1,294,521 1,505,486 1,219,407 2,247,042 6,266,457 %CHYA 10.8% 10.1% -1.6% 4.9% 6.0% 0.7% 7.3% 7.5% 10.7% 7.1%

May 2013OREGON PERSONAL INCOME TAX REVENUE FORECAST - QUARTERLY COLLECTIONS

Thousands of Dollars - Not Seasonally Adjusted

Note: "Other" includes kicker and federal pension refunds, as well as July withholding accrued to June.Tax law impacts are reflected in the collections numbers to produce more meaningful projections.

46

TABLE B.4

2013:3 2013:4 2014:1 2014:2 FY 2014 2014:3 2014:4 2015:1 2015:2 FY 2015

WITHHOLDING 1,347,517 1,423,691 1,425,986 1,387,507 5,584,700 1,440,006 1,493,888 1,507,377 1,468,721 5,909,992 %CHYA 6.7% 4.3% 5.3% 5.0% 5.3% 6.9% 4.9% 5.7% 5.9% 5.8%

EST. PAYMENTS 244,853 186,350 285,449 370,539 1,087,191 293,365 226,021 327,376 397,211 1,243,972 %CHYA 19.1% 17.1% 2.6% 15.1% 12.7% 19.8% 21.3% 14.7% 7.2% 14.4%

FINAL PAYMENTS1 74,435 95,065 102,034 774,971 1,046,506 68,240 93,729 112,315 899,186 1,173,469 %CHYA 3.1% 4.1% -17.4% -1.3% -2.4% -8.3% -1.4% 10.1% 16.0% 12.1%

REFUNDS 81,700 169,409 498,422 443,419 1,192,950 95,211 187,211 523,623 465,620 1,271,665 %CHYA 56.5% 54.7% -7.1% 15.7% 10.3% 16.5% 10.5% 5.1% 5.0% 6.6%

OTHER (201,367) - - 211,296 9,929 (211,296) - - 223,654 12,358 TOTAL 1,383,738 1,535,697 1,315,047 2,300,895 6,535,377 1,495,103 1,626,428 1,423,444 2,523,152 7,068,127 %CHYA 6.9% 2.0% 7.8% 2.4% 4.3% 8.0% 5.9% 8.2% 9.7% 8.2%

2015:3 2015:4 2016:1 2016:2 FY 2016 2016:3 2016:4 2017:1 2017:2 FY 2017

WITHHOLDING 1,524,210 1,581,246 1,588,261 1,546,215 6,239,933 1,604,686 1,664,731 1,654,778 1,607,820 6,532,015 %CHYA 5.8% 5.8% 5.4% 5.3% 5.6% 5.3% 5.3% 4.2% 4.0% 4.7%

EST. PAYMENTS 314,481 242,291 350,890 424,570 1,332,232 336,142 258,979 374,532 441,014 1,410,668 %CHYA 7.2% 7.2% 7.2% 6.9% 7.1% 6.9% 6.9% 6.7% 3.9% 5.9%

FINAL PAYMENTS1 75,138 104,320 121,632 962,863 1,263,953 82,162 113,947 129,397 1,017,545 1,343,051 %CHYA 10.1% 11.3% 8.3% 7.1% 7.7% 9.3% 9.2% 6.4% 5.7% 6.3%

REFUNDS 100,221 196,457 571,293 505,678 1,373,649 108,215 213,372 596,938 527,639 1,446,164 %CHYA 5.3% 4.9% 9.1% 8.6% 8.0% 8.0% 8.6% 4.5% 4.3% 5.3%

OTHER -223,654 0 0 235,461 11,807 -235,461 0 0 244,858 9,397 TOTAL 1,589,955 1,731,400 1,489,490 2,663,431 7,474,276 1,679,314 1,824,285 1,561,769 2,783,599 7,848,966 %CHYA 6.3% 6.5% 4.6% 5.6% 5.7% 5.6% 5.4% 4.9% 4.5% 5.0%

2017:3 2017:4 2018:1 2018:2 FY 2018 2018:3 2018:4 2019:1 2019:2 FY 2019

WITHHOLDING 1,668,750 1,731,188 1,735,556 1,689,013 6,824,507 1,752,908 1,818,499 1,839,331 1,792,961 7,203,700 %CHYA 4.0% 4.0% 4.9% 5.0% 4.5% 5.0% 5.0% 6.0% 6.2% 5.6%

EST. PAYMENTS 349,162 269,010 388,982 456,731 1,463,884 361,605 278,596 402,899 474,351 1,517,451 %CHYA 3.9% 3.9% 3.9% 3.6% 3.8% 3.6% 3.6% 3.6% 3.9% 3.7%

FINAL PAYMENTS1 87,332 120,874 136,124 1,072,371 1,416,700 91,693 126,302 140,051 1,090,265 1,448,311 %CHYA 6.3% 6.1% 5.2% 5.4% 5.5% 5.0% 4.5% 2.9% 1.7% 2.2%

REFUNDS 114,760 225,101 619,307 547,429 1,506,597 119,667 234,146 662,777 586,081 1,602,671 %CHYA 6.0% 5.5% 3.7% 3.8% 4.2% 4.3% 4.0% 7.0% 7.1% 6.4%

OTHER (244,858) - - 257,210 12,351 (257,210) - - 273,024 15,815 TOTAL 1,745,625 1,895,971 1,641,355 2,927,895 8,210,846 1,829,330 1,989,252 1,719,504 3,044,520 8,582,606 %CHYA 3.9% 3.9% 5.1% 5.2% 4.6% 4.8% 4.9% 4.8% 4.0% 4.5%

2019:3 2019:4 2020:1 2020:2 FY 2020 2020:3 2020:4 2021:1 2021:2 FY 2021

WITHHOLDING 1,860,667 1,930,295 1,933,999 1,881,916 7,606,877 1,953,118 2,026,200 2,028,464 1,973,544 7,981,325 %CHYA 6.1% 6.1% 5.1% 5.0% 5.6% 5.0% 5.0% 4.9% 4.9% 4.9%

EST. PAYMENTS 378,555 292,345 421,424 495,188 1,587,512 392,678 303,225 437,389 519,309 1,652,601 %CHYA 4.7% 4.9% 4.6% 4.4% 4.6% 3.7% 3.7% 3.8% 4.9% 4.1%

FINAL PAYMENTS1 98,213 133,351 150,515 1,095,910 1,477,989 98,322 132,973 154,698 1,139,258 1,525,251 %CHYA 7.1% 5.6% 7.5% 0.5% 2.0% 0.1% -0.3% 2.8% 4.0% 3.2%

REFUNDS 127,689 245,213 694,868 614,039 1,681,810 134,798 256,066 704,919 622,776 1,718,558 %CHYA 6.7% 4.7% 4.8% 4.8% 4.9% 5.6% 4.4% 1.4% 1.4% 2.2%

OTHER -273,024 0 0 286,587 13,563 -286,587 0 0 300,542 13,955 TOTAL 1,936,722 2,110,777 1,811,069 3,145,562 9,004,131 2,022,732 2,206,333 1,915,632 3,309,877 9,454,574 %CHYA 5.9% 6.1% 5.3% 3.3% 4.9% 4.4% 4.5% 5.8% 5.2% 5.0%

2021:3 2021:4 2022:1 2022:2 FY 2022 2022:3 2022:4 2023:1 2023:2 FY 2023

WITHHOLDING 2,048,224 2,124,864 2,136,753 2,080,637 8,390,478 2,159,298 2,240,097 2,238,521 2,177,168 8,815,084 %CHYA 4.9% 4.9% 5.3% 5.4% 5.1% 5.4% 5.4% 4.8% 4.6% 5.1%

EST. PAYMENTS 408,775 314,938 455,914 547,351 1,726,978 433,351 333,873 483,455 583,449 1,834,128 %CHYA 4.1% 3.9% 4.2% 5.4% 4.5% 6.0% 6.0% 6.0% 6.6% 6.2%

FINAL PAYMENTS1 101,539 137,969 154,169 1,183,559 1,577,236 101,173 139,249 158,501 1,261,635 1,660,558 %CHYA 3.3% 3.8% -0.3% 3.9% 3.4% -0.4% 0.9% 2.8% 6.6% 5.3%

REFUNDS 137,460 263,374 738,586 653,292 1,792,712 142,822 274,137 767,047 678,565 1,862,573 %CHYA 2.0% 2.9% 4.8% 4.9% 4.3% 3.9% 4.1% 3.9% 3.9% 3.9%

OTHER -300,542 0 0 316,842 16,300 -316,842 0 0 331,555 14,713 TOTAL 2,120,536 2,314,398 2,008,250 3,475,096 9,918,280 2,234,158 2,439,081 2,113,430 3,675,242 10,461,910 %CHYA 4.8% 4.9% 4.8% 5.0% 4.9% 5.4% 5.4% 5.2% 5.8% 5.5%

Note: "Other" includes kicker and federal pension refunds, as well as July withholding accrued to June.Tax law impacts are reflected in the collections numbers to produce more meaningful projections.

May 2013OREGON PERSONAL INCOME TAX REVENUE FORECAST - QUARTERLY COLLECTIONS

Thousands of Dollars - Not Seasonally Adjusted

47

Table B.5 Oregon Corporate Income Tax Revenue Forecast

TABLE B.5

FY FY2005:3 2005:4 2006:1 2006:2 2006 2006:3 2006:4 2007:1 2007:2 2007

ADVANCE PAYMENTS 119,391 183,280 59,091 163,812 525,573 129,737 236,441 59,754 162,465 588,396 %CHYA 29.6% 27.8% 46.0% 12.1% 24.5% 8.7% 29.0% 1.1% -0.8% 12.0%

FINAL PAYMENTS 14,985 17,619 24,327 39,526 96,457 19,718 17,154 25,440 65,628 127,941 %CHYA -9.6% 7.0% 20.9% -14.0% -2.7% 31.6% -2.6% 4.6% 66.0% 32.6%

REFUNDS 16,350 108,723 19,140 39,592 183,805 22,481 199,419 38,715 49,865 310,480 %CHYA -12.2% -16.6% 25.9% 17.4% -7.1% 37.5% 83.4% 102.3% 25.9% 68.9%

TOTAL 118,026 92,177 64,278 163,745 438,225 126,975 54,176 46,478 178,228 405,857 %CHYA 31.1% 212.4% 41.6% 3.4% 35.6% 7.6% -41.2% -27.7% 8.8% -7.4%

FY FY2007:3 2007:4 2008:1 2008:2 2008 2008:3 2008:4 2009:1 2009:2 2009

ADVANCE PAYMENTS 133,408 205,375 64,256 155,284 558,323 100,589 145,285 63,802 97,368 407,044 %CHYA 2.8% -13.1% 7.5% -4.4% -5.1% -24.6% -29.3% -0.7% -37.3% -27.1%

FINAL PAYMENTS 23,631 45,064 35,076 52,143 155,912 23,501 26,721 22,314 21,822 94,357 %CHYA 19.8% 162.7% 37.9% -20.5% 21.9% -0.6% -40.7% -36.4% -58.1% -39.5%

REFUNDS 39,623 158,106 36,380 39,394 273,503 28,134 124,826 67,471 37,218 257,649 %CHYA 76.3% -20.7% -6.0% -21.0% -11.9% -29.0% -21.0% 85.5% -5.5% -5.8%

TOTAL 117,416 92,333 62,951 168,032 440,732 95,956 47,181 18,645 81,971 243,753 %CHYA -7.5% 70.4% 35.4% -5.7% 8.6% -18.3% -48.9% -70.4% -51.2% -44.7%

FY FY2009:3 2009:4 2010:1 2010:2 2010 2010:3 2010:4 2011:1 2011:2 2011

ADVANCE PAYMENTS 79,579 163,877 66,451 147,313 457,220 115,286 175,561 76,405 165,354 532,606 %CHYA -20.9% 12.8% 4.2% 51.3% 12.3% 44.9% 7.1% 15.0% 12.2% 16.5%

FINAL PAYMENTS 20,404 24,009 38,412 45,714 128,539 21,781 21,206 35,770 40,805 119,562 %CHYA -13.2% -10.2% 72.1% 109.5% 36.2% 6.8% -11.7% -6.9% -10.7% -7.0%

REFUNDS 29,072 137,244 40,080 25,774 232,170 23,130 89,877 39,065 31,489 183,562 %CHYA 3.3% 9.9% -40.6% -30.7% -9.9% -20.4% -34.5% -2.5% 22.2% -20.9%

TOTAL 70,910 50,642 64,784 167,254 353,589 113,936 106,890 73,111 174,670 468,606 %CHYA -26.1% 7.3% 247.5% 104.0% 45.1% 60.7% 111.1% 12.9% 4.4% 32.5%

FY FY2011:3 2011:4 2012:1 2012:2 2012 2012:3 2012:4 2013:1 2013:2 2013

ADVANCE PAYMENTS1 120,766 154,290 86,873 156,652 518,581 130,348 110,207 80,942 282,526 604,023 %CHYA 4.8% -12.1% 13.7% -5.3% -2.6% 7.9% -28.6% -6.8% 80.4% 16.5%

FINAL PAYMENTS1 19,117 26,841 32,512 33,322 111,792 16,387 21,377 36,660 34,009 108,433 %CHYA -12.2% 26.6% -9.1% -18.3% -6.5% -14.3% -20.4% 12.8% 2.1% -3.0%

REFUNDS 34,927 91,252 55,051 18,153 199,384 33,212 17,832 25,595 182,929 259,568 %CHYA 51.0% 1.5% 40.9% -42.4% 8.6% -4.9% -80.5% -53.5% 907.7% 30.2%

TOTAL1 104,955 89,878 64,335 171,820 430,989 113,524 113,751 92,007 133,606 452,888 %CHYA -7.9% -15.9% -12.0% -1.6% -8.0% 8.2% 26.6% 43.0% -22.2% 5.1%

OREGON CORPORATE INCOME TAX REVENUE FORECAST - QUARTERLY COLLECTIONSThousands of Dollars - Not Seasonally Adjusted May 2013

48

TABLE B.5

FY FY2013:3 2013:4 2014:1 2014:2 2014 2014:3 2014:4 2015:1 2015:2 2015

ADVANCE PAYMENTS1 138,250 118,782 92,673 188,919 538,624 163,595 161,998 99,078 205,894 630,564 %CHYA 6.1% 7.8% 14.5% -33.1% -10.8% 18.3% 36.4% 6.9% 9.0% 17.1%

FINAL PAYMENTS1 22,918 26,354 39,898 42,805 131,975 22,159 25,777 37,592 42,433 127,960 %CHYA 39.9% 23.3% 8.8% 25.9% 21.7% -3.3% -2.2% -5.8% -0.9% -3.0%

REFUNDS 47,837 38,008 47,567 48,844 182,256 64,868 51,442 59,893 58,628 234,831 %CHYA 44.0% 113.1% 85.8% -73.3% -29.8% 35.6% 35.3% 25.9% 20.0% 28.8%

TOTAL1 113,331 107,128 85,004 182,879 488,343 120,885 136,332 76,776 189,700 523,693 %CHYA -0.2% -5.8% -7.6% 36.9% 7.8% 6.7% 27.3% -9.7% 3.7% 7.2%

FY FY2015:3 2015:4 2016:1 2016:2 2016 2016:3 2016:4 2017:1 2017:2 2017

ADVANCE PAYMENTS1 171,951 165,129 102,683 211,299 651,063 172,367 170,285 106,519 214,026 663,197 %CHYA 5.1% 1.9% 3.6% 2.6% 3.3% 0.2% 3.1% 3.7% 1.3% 1.9%

FINAL PAYMENTS1 21,295 26,231 39,555 42,199 129,279 20,447 25,114 38,172 41,486 125,220 %CHYA -3.9% 1.8% 5.2% -0.6% 1.0% -4.0% -4.3% -3.5% -1.7% -3.1%

REFUNDS 68,832 60,012 68,391 63,998 261,233 75,763 64,766 70,760 67,470 278,760 %CHYA 6.1% 16.7% 14.2% 9.2% 11.2% 10.1% 7.9% 3.5% 5.4% 6.7%

TOTAL1 124,414 131,348 73,847 189,500 519,109 117,051 130,633 73,931 188,042 509,657 %CHYA 2.9% -3.7% -3.8% -0.1% -0.9% -5.9% -0.5% 0.1% -0.8% -1.8%

FY FY2017:3 2017:4 2018:1 2018:2 2018 2018:3 2018:4 2019:1 2019:2 2019

ADVANCE PAYMENTS1 174,187 170,625 108,112 219,190 672,115 175,654 173,215 110,277 220,195 679,342 %CHYA 1.1% 0.2% 1.5% 2.4% 1.3% 0.8% 1.5% 2.0% 0.5% 1.1%

FINAL PAYMENTS1 20,821 24,982 37,644 42,098 125,545 20,611 24,759 37,743 41,127 124,239 %CHYA 1.8% -0.5% -1.4% 1.5% 0.3% -1.0% -0.9% 0.3% -2.3% -1.0%

REFUNDS 81,306 67,604 73,521 71,925 294,356 84,287 70,985 75,907 72,274 303,453 %CHYA 7.3% 4.4% 3.9% 6.6% 5.6% 3.7% 5.0% 3.2% 0.5% 3.1%

TOTAL1 113,702 128,003 72,235 189,363 503,303 111,978 126,989 72,113 189,047 500,127 %CHYA -2.9% -2.0% -2.3% 0.7% -1.2% -1.5% -0.8% -0.2% -0.2% -0.6%

FY FY2019:3 2019:4 2020:1 2020:2 2020 2020:3 2020:4 2021:1 2021:2 2021

ADVANCE PAYMENTS1 179,040 177,282 111,332 223,106 690,759 182,060 182,984 115,650 225,757 706,450 %CHYA 1.9% 2.3% 1.0% 1.3% 1.7% 1.7% 3.2% 3.9% 1.2% 2.3%

FINAL PAYMENTS1 20,686 24,966 37,905 42,441 125,998 21,409 25,833 38,889 43,122 129,254 %CHYA 0.4% 0.8% 0.4% 3.2% 1.4% 3.5% 3.5% 2.6% 1.6% 2.6%

REFUNDS 85,778 71,961 76,953 74,607 309,299 86,956 72,180 76,089 73,830 309,054 %CHYA 1.8% 1.4% 1.4% 3.2% 1.9% 1.4% 0.3% -1.1% -1.0% -0.1%

TOTAL1 113,948 130,287 72,283 190,940 507,458 116,514 136,636 78,450 195,049 526,649 %CHYA 1.8% 2.6% 0.2% 1.0% 1.5% 2.3% 4.9% 8.5% 2.2% 3.8%

FY FY2021:3 2021:4 2022:1 2022:2 2022 2022:3 2022:4 2023:1 2023:2 2023

ADVANCE PAYMENTS1 186,597 188,519 118,943 232,863 726,921 188,716 190,316 121,245 232,945 733,222 %CHYA 2.5% 3.0% 2.8% 3.1% 2.9% 1.1% 1.0% 1.9% 0.0% 0.9%

FINAL PAYMENTS1 23,105 26,928 40,170 45,972 136,175 24,999 28,861 41,985 46,118 141,963 %CHYA 7.9% 4.2% 3.3% 6.6% 5.4% 8.2% 7.2% 4.5% 0.3% 4.3%

REFUNDS 87,002 69,903 74,745 74,852 306,502 86,910 71,029 74,315 72,194 304,449 %CHYA 0.1% -3.2% -1.8% 1.4% -0.8% -0.1% 1.6% -0.6% -3.6% -0.7%

TOTAL1 122,700 145,544 84,368 203,983 556,595 126,805 148,148 88,915 206,868 570,736 %CHYA 5.3% 6.5% 7.5% 4.6% 5.7% 3.3% 1.8% 5.4% 1.4% 2.5%

1 Includes adjustments for changes in tax law.

May 2013OREGON CORPORATE INCOME TAX REVENUE FORECAST - QUARTERLY COLLECTIONS

Thousands of Dollars - Not Seasonally Adjusted

49

Table B.6 Cigarette and Tobacco Tax Distribution

TABL

E B.

6Ci

gare

tte &

Tob

acco

Tax

Dis

tribu

tion

(Mill

ions

of $

)*

Toba

cco

Use

Healt

h Pl

anRe

duct

ion

Citie

s,To

bacc

o Us

eSt

ate G

F(M

easu

re 44

)Ac

coun

tCo

untie

s &He

alth

Plan

4Re

duct

ion

(22 c

ents

) 1(8

7 cen

ts) 1

(3 ce

nts)

2St

ate T

otal

Publ

ic Tr

ansit

3To

tal

Stat

e GF

(Mea

sure

44)

Acco

unt 4

Stat

e Tot

al

Dist

ribut

ion

Fore

cast

*20

11-1

237

.938

147.8

55

5.8

98

191.6

91

11

.795

203.4

87

28

.087

21.67

02.4

1052

.167

20

12-1

337

.018

144.2

67

5.7

55

187.0

39

11

.509

198.5

48

30

.522

23.54

92.6

1956

.690

20

11-1

3 Bien

nium

74.95

6

29

2.123

11.65

2

37

8.731

23.30

440

2.035

58.60

945

.219

5.029

108.8

58

2013

-14

35.27

2

13

7.465

5.483

17

8.220

10.96

618

9.186

29.27

322

.586

2.512

54.37

1

2014

-15

33.77

7

13

1.640

5.251

17

0.668

10.50

218

1.170

30.09

323

.218

2.582

55.89

3

2013

-15 B

ienni

um69

.050

269.1

05

10

.734

348.8

88

21

.468

370.3

56

59

.366

45.80

45.0

9411

0.264

2015

-16

32.29

2

12

5.851

5.020

16

3.163

10.04

017

3.203

30.93

623

.868

2.655

57.45

8

2016

-17

30.34

4

11

8.259

4.717

15

3.320

9.434

162.7

54

31

.802

24.53

72.7

2959

.067

20

15-1

7 Bien

nium

62.63

6

24

4.110

9.737

31

6.484

19.47

433

5.958

62.73

748

.405

5.383

116.5

26

2017

-18

28.97

9

11

2.937

4.505

14

6.421

9.010

155.4

31

32

.692

25.22

42.8

0560

.721

20

18-1

927

.675

107.8

55

4.3

02

139.8

32

8.6

0414

8.436

33.60

825

.930

2.884

62.42

1

2017

-19 B

ienni

um56

.653

220.7

93

8.8

07

286.2

53

17

.614

303.8

67

66

.300

51.15

35.6

8912

3.142

2019

-20

26.42

9

10

3.002

4.109

13

3.539

8.217

141.7

57

34

.549

26.65

62.9

6564

.169

20

20-2

125

.240

98.36

7

3.9

24

127.5

30

7.8

4713

5.377

35.51

627

.402

3.048

65.96

6

2019

-21 B

ienni

um51

.669

201.3

68

8.0

32

261.0

70

16

.064

277.1

34

70

.065

54.05

86.0

1213

0.135

2021

-22

24.10

4

93

.940

3.747

12

1.791

7.494

129.2

86

36

.510

28.16

93.1

3367

.813

20

22-2

323

.019

89.71

3

3.5

78

116.3

11

7.1

5712

3.468

37.53

328

.958

3.221

69.71

2

2021

-23 B

ienni

um47

.123

183.6

53

7.3

26

238.1

02

14

.651

252.7

53

74

.043

57.12

86.3

5413

7.524

1. Th

e 199

7 Leg

islatu

re sp

ecifie

d tha

t the t

empo

rary

10 ce

nt tax

be co

unted

as ot

her fu

nds s

tartin

g July

1, 19

97. A

s a re

sult t

he H

ealth

Plan

rece

ived 3

7 cen

ts pe

r pac

k as o

f July

1, 19

97.

The 1

0 cen

t tax

has e

xpire

d on J

anua

ry 1,

2004

.

V

oters

appro

ved 6

0 cen

ts pe

r pac

k tax

incre

ase d

edica

ted to

the H

ealth

Plan

, effe

ctive

Nov

embe

r 1, 2

002.

2. M

easu

re 44

crea

ted th

e TUR

A an

d fun

ded i

t with

a 3 c

ents

per p

ack t

ax ef

fectiv

e Feb

ruary

1, 19

97.

3. C

ities,

Coun

ties a

nd P

ublic

Tran

sit ea

ch re

ceive

reve

nue f

rom a

2 cen

t per

pack

tax.

The

total

amou

nt sh

own e

quals

the t

otal 6

cents

per p

ack d

edica

ted to

thes

e enti

ties.

4. M

easu

re 44

incre

ased

the o

ther to

bacc

o tax

es fro

m 35

% to

65%

of th

e who

lesale

price

, effe

ctive

Feb

ruary

1, 19

97.

Hou

se B

ill 34

33, e

nacte

d by

the 20

01 Le

gislat

ure, li

mits

this t

ax to

50 c

ents

per c

igar.

The H

ealth

Plan

rece

ives 4

1.54%

of th

e rev

enue

from

the ot

her to

bacc

o tax

colle

ction

s. Th

e TUR

A rec

eives

4.62

% of

colle

ction

s. Th

e rem

ainde

r goe

s to t

he G

enera

l Fun

d.

Othe

r Tob

acco

Tax

Dist

ribut

ion

Ciga

rette

Tax

Dist

ribut

ion

Sept

embe

r 201

3

50

Table B.7 Revenue Distribution to Local Governments

TA

BLE

B.7

Rev

enue

Dis

trib

utio

n to

Loc

al G

over

nmen

ts (M

illio

ns o

f $)

Cig

aret

te T

axTo

tal L

iquo

rD

istr

ibut

ion

toR

even

ueG

ener

alM

enta

lO

rego

nR

even

ueC

ities

, Cou

ntie

s &

Ava

ilabl

eFu

nd (5

6%)

Hea

lth 1

Win

e B

oard

Shar

ing

Reg

ular

Tota

lC

ount

ies

Publ

ic T

rans

it 2

2011

-12

194.

104

110.

200

8.30

00.

283

23.9

6634

.237

58.2

0317

.118

11.7

9520

12-1

320

2.61

211

5.36

48.

051

0.28

225

.109

35.8

7060

.980

17.9

3511

.509

2011

-13

Bie

nniu

m39

6.71

622

5.56

416

.351

0.56

549

.075

70.1

0711

9.18

335

.054

23.3

04

2013

-14

218.

937

124.

551

8.82

20.

316

27.1

2438

.749

65.8

7319

.374

10.9

6620

14-1

522

3.35

912

7.06

79.

001

0.32

227

.672

39.5

3267

.204

19.7

6610

.502

2013

-15

Bie

nniu

m44

2.29

625

1.61

917

.823

0.63

854

.796

78.2

8013

3.07

639

.140

21.4

68

2015

-16

213.

681

114.

500

9.27

10.

332

28.5

0240

.717

69.2

2020

.359

10.0

4020

16-1

722

0.09

211

7.93

59.

549

0.34

229

.357

41.9

3971

.296

20.9

709.

434

2015

-17

Bie

nniu

m43

3.77

323

2.43

518

.819

0.67

457

.860

82.6

5614

0.51

641

.328

19.4

74

2017

-18

226.

694

121.

473

9.83

50.

352

30.2

3843

.197

73.4

3521

.599

9.01

020

18-1

923

3.49

512

5.11

810

.130

0.36

331

.145

44.4

9375

.638

22.2

478.

604

2017

-19

Bie

nniu

m46

0.19

024

6.59

119

.966

0.71

561

.383

87.6

9014

9.07

343

.845

17.6

14

2019

-20

240.

500

128.

871

10.4

340.

374

32.0

8045

.828

77.9

0722

.914

8.21

720

20-2

124

7.71

513

2.73

710

.747

0.38

533

.042

47.2

0380

.245

23.6

017.

847

2019

-21

Bie

nniu

m48

8.21

526

1.60

821

.181

0.75

965

.121

93.0

3015

8.15

246

.515

16.0

64

2021

-22

255.

147

136.

719

11.0

700.

396

34.0

3348

.619

82.6

5224

.309

7.49

420

22-2

326

2.80

114

0.82

111

.402

0.40

835

.054

50.0

7785

.131

25.0

397.

157

2021

-23

Bie

nniu

m51

7.94

827

7.54

022

.471

0.80

569

.087

98.6

9616

7.78

349

.348

14.6

51

1 Men

tal H

ealth

Alc

ohol

ism a

nd D

rug

Serv

ices

Acc

ount

, per

OR

S 47

1.81

02 F

or d

etai

ls on

cig

aret

te re

venu

es s

ee T

AB

LE B

.6 o

n pr

evio

us p

age

Sept

embe

r 201

3

Liq

uor

App

ortio

nmen

t Dis

trib

utio

n

City

Rev

enue

51

Table B.8 Track Record for the May 2013 Forecast

(Millions of dollars)Actual

RevenuesLatest

ForecastPercent

DifferencePriorYear

PercentChange

Withholding $1,321.4 $1,319.2 0.2% $1,269.6 4.1%Dollar difference $2.2 $51.9

Estimated Payments $321.9 $337.0 -4.5% $299.6 7.4%Dollar difference -$15.1 $22.3

Final Payments $785.5 $752.2 4.4% $627.8 25.1%Dollar difference $33.3 $157.8

Refunds -$383.2 -$328.5 16.6% -$360.6 6.3%Dollar difference -$54.7 -$22.6

Total Personal Income Tax $2,045.7 $2,079.9 -1.6% $1,836.4 11.4%Dollar difference -$34.3 $209.3

(Millions of dollars)Actual

RevenuesLatest

ForecastPercent

DifferencePriorYear

PercentChange

Advanced Payments $282.5 $179.5 57.4% $156.7 80.4%Dollar difference $103.0 $125.9

Final Payments $34.0 $32.9 3.5% $33.3 2.1%Dollar difference $1.1 $0.7

Refunds -$182.9 -$48.1 280.5% -$18.2 907.7%Dollar difference -$134.9 -$164.8

Total Corporate Income Tax $133.6 $164.3 -18.7% $171.8 -22.2%Dollar difference -$30.7 -$38.2

(Millions of dollars)Actual

RevenuesLatest

ForecastPercent

DifferencePriorYear

PercentChange

Corporate and Personal Tax $2,179.3 $2,244.3 -2.9% $2,008.2 8.5%Dollar difference -$65.0 $171.1

Corporate Income Tax Forecast Comparison

Table B.8 Track Record for the May 2013 Forecast(Quarter ending June 31, 2013)

Total Income Tax Forecast Comparison Year/Year Change

Forecast Comparison Year/Year Change

Year/Year Change

Personal Income Tax

52

Table B.9 Summary of Lottery Resources

TABL

E B.

9Se

pt 2

013

Fore

cast

Summ

ary o

f Lot

tery

Res

ourc

es20

13-1

520

15-1

720

17-1

920

19-2

120

21-2

3

(in m

illion

s of d

ollar

s)Cu

rrent

Fo

reca

stCh

ange

from

May-1

3

Chan

ge

from

COS

2013

Curre

nt

Fore

cast

Chan

ge fro

m Ma

y-13

Curre

nt

Fore

cast

Chan

ge fro

m Ma

y-13

Curre

nt

Fore

cast

Chan

ge fro

m Ma

y-13

Curre

nt

Fore

cast

Chan

ge fro

m Ma

y-13

LOTT

ERY

EARN

INGS

Trad

itiona

l Lott

ery1

129.4

646.8

036.8

0312

1.303

(1.01

0)11

9.873

(1.77

8)11

9.395

(1.77

0)12

0.517

(1.76

3)Vid

eo Lo

ttery

927.8

71(4

.051)

(4.05

1)1,0

28.53

0(2

.469)

1,192

.899

(1.86

7)1,3

12.28

3(1

.485)

1,445

.589

(1.43

0)Ad

min.

Sav

ings

0.000

0.000

0.000

0.000

0.000

0.000

0.000

0.000

0.000

0.000

0.000

Tota

l Ava

ilabl

e to

Tran

sfer

1,057

.335

2.752

2.752

1,149

.834

(3.47

9)1,3

12.77

1(3

.645)

1,431

.678

(3.25

5)1,5

66.10

6(3

.194)

ECON

OMIC

DEV

ELOP

MEN

T FU

NDBe

ginnin

g Bala

nce

3.491

(0.12

3)0.0

000.0

000.0

000.0

000.0

000.0

000.0

000.0

000.0

00Tr

ansfe

rs fro

m Lo

ttery

1,057

.335

2.752

2.752

1,149

.834

(3.47

9)1,3

12.77

1(3

.645)

1,431

.678

(3.25

5)1,5

66.10

6(3

.194)

Othe

r Res

ourc

es2

1.400

0.000

0.000

2.000

0.000

2.000

0.000

2.000

0.000

2.000

0.000

Tota

l Ava

ilabl

e Res

ourc

es1,0

62.22

62.6

292.7

521,1

51.83

4(3

.479)

1,314

.771

(3.64

5)1,4

33.67

8(3

.255)

1,568

.106

(3.19

4)

ALLO

CATI

ON O

F RE

SOUR

CES

Coun

ty Ec

onom

ic De

velop

men

t33

.849

(1.93

3)0.0

0039

.492

(0.09

5)45

.803

(0.07

2)51

.156

(0.05

7)59

.502

(0.05

5)Ed

ucati

on S

tabilit

y Fun

d 319

0.320

0.495

0.495

206.9

70(0

.626)

236.2

99(0

.656)

257.7

02(0

.586)

281.8

99(0

.575)

Parks

and N

atura

l Res

ourc

es F

und4

158.6

000.4

130.4

1317

2.475

(0.52

2)19

6.916

(0.54

7)21

4.752

(0.48

8)23

4.916

(0.47

9)OU

S Sp

orts

Lotte

ry Ac

coun

t 58.0

00(2

.546)

0.000

11.49

8(0

.035)

13.12

8(0

.036)

14.31

7(0

.033)

15.66

1(0

.032)

Gam

bling

Addic

tion 5

10.54

60.0

000.0

0011

.498

(0.03

5)13

.128

(0.03

6)14

.317

(0.03

3)15

.661

(0.03

2)Co

unty

Fairs

3.669

0.021

0.000

3.648

0.000

3.648

0.000

3.648

0.000

3.648

0.000

Othe

r Leg

ilativ

ely Ad

opted

Alloc

ation

s664

0.397

360.1

560.0

0026

9.600

0.000

258.6

000.0

0025

8.600

0.000

258.6

000.0

00To

tal D

istri

butio

ns1,0

45.38

235

6.607

0.908

715.1

82(1

.312)

767.5

21(1

.347)

814.4

92(1

.196)

869.8

88(1

.17)

Endi

ng B

alan

ce/D

iscr

etio

nary

Res

ourc

es16

.844

(353

.978)

1.844

436.6

52(2

.166)

547.2

50(2

.297)

619.1

86(2

.059)

698.2

18(2

.021)

Note:

Som

e tota

ls ma

y no

t foot

due t

o rou

nding

.

1. In

clude

s plan

ned r

affles

throu

ghou

t the f

oreca

st pe

riod.

2. In

clude

s inte

rest e

arning

s on E

cono

mic D

evelo

pmen

t Fun

d and

reve

rsion

s.

3. Ei

ghtee

n perc

ent o

f proc

eeds

accru

e to t

he E

d. St

ability

Fun

d, un

til the

balan

ce eq

uals

5% of

GF

Reve

nues

. Th

ereaft

er, 15

% of

proc

eeds

accru

e to t

he O

regon

Cap

ital M

atchin

g Acc

ount.

4. Th

e Park

s and

Natu

ral R

esou

rces F

und C

onsti

tution

al am

endm

ent re

quire

s 15%

of ne

t proc

eeds

be tra

nsfer

red to

this

fund.

5. On

e perc

ent o

f net

lotter

y pro

ceed

s are

dedic

ated t

o Coll

egiat

e Athl

etics

and G

ambli

ng A

ddict

ion pr

ogram

s, res

pecti

vely.

Cert

ain lim

its ar

e imp

osed

by H

B 50

35 fo

r 201

1-13.

6. Inc

ludes

Deb

t Serv

ice A

lloca

tions

, Allo

catio

ns to

Stat

e Sch

ool F

und a

nd O

ther A

genc

y Al

locati

ons

53

Table B.10 Budgetary Reserve Summary and Outlook

Rainy Day Fund(Millions) 2011-13 2013-15 2015-17 2017-19 2019-21 2021-23

Beginning Balance $10.4 $61.8 $243.4 $458.8 $725.7 $1,034.6

Interest Earnings $0.6 $2.0 $17.3 $52.5 $76.8 $104.8

Deposits1 $50.8 $179.6 $198.0 $214.4 $232.1 $252.8

Ending Balance2 $61.8 $243.4 $458.8 $725.7 $1,034.6 $1,392.3

Education Stability Fund3

(Millions) 2011-13 2013-15 2015-17 2017-19 2019-21 2021-23

Beginning Balance $5.1 $7.4 $178.7 $365.0 $576.4 $804.6

Interest Earnings4 $0.6 $1.0 $12.8 $39.4 $58.0 $36.3

Deposits5 $184.6 $171.3 $186.3 $211.4 $228.2 $90.0

Distributions -$182.9 -$1.0 -$12.8 -$39.4 -$58.0 -$33.2Oregon Education Fund -$0.5 -$0.7 -$9.6 -$29.5 -$43.5 -$24.9Oregon Student Access Comm. -$0.2 -$0.2 -$3.2 -$9.8 -$14.5 -$8.3Withdrawals -$182.2 $0.0 $0.0 $0.0 $0.0 $0.0

Ending Balance $7.4 $178.7 $365.0 $576.4 $804.6 $897.7

Total Reserves(Millions) 2011-13 2013-15 2015-17 2017-19 2019-21 2019-21

Ending Balances $69.2 $422.1 $823.8 $1,302.1 $1,839.2 $2,290.0

Percent of GF Revenues 0.5% 2.7% 4.8% 6.9% 8.9% 10.1%

Table B.10: Budgetary Reserve Summary and Out

Footnotes:1. Includes transfer of ending General Fund balances, up to 1% of budgeted appropriations, as well as private donations. Assumes future appropriations equal to 98.75 percent of available resources. Starting with 2013-15, projected corporate income taxes above the rate of 6.6% for the biennium are deposited on or before June 30 of each odd-numbered year.2. Available funds in a given biennium equal 2/3rds of the beginning balance under current law.3. Excludes funds in the Oregon Growth and the Oregon Resource and Technology Development subaccounts.4. Interest earnings are distributed to the Oregon Education Funds (75% ) and the State Scholarship Fund (25% ).5. Contributions to the ESF are capped at 5% of the prior biennium's General Fund revenue total. Quarterly contributions are made until the balance exceeds the cap.

September 2013

54

APPENDIX C: POPULATION FORECASTS BY AGE AND SEX

Table C.1 Population Forecasts Component of Change 1980-2020 …………………………………... 57

Table C.2 Population Forecasts by Age and Sex: 2000-2020 ………………………………………….. 58

Table C.3 Population of Oregon: 1980-2020 ……………………………………………………………... 59

Table C.4 Children: Ages 0-4 ………………………………………………………………………………. 59

Table C.5 School Age Population: Ages 5-17 ……………………………………………………………. 59

Table C.6 Young Adult Population: Ages 18-24 ………………………………………………………….. 59

Table C.7 Criminally At Risk Population: Males Ages 15-39 ……………………………………………. 60

Table C.8 Prime Wage Earners: Ages 25-44 …………………………………………………………….. 60

Table C.9 Older Wage Earners: Ages 45-64 …………………………………………………………….. 60

Table C.10 Elderly Population by Age Group ……………………………………………………………… 60

55

OREGON'S POPULATION FORECASTS BY AGE AND SEX

Oregon’s population count on April 1, 2010 was 3,831,074. Oregon gained 409,550 persons between the years 2000 and 2010. The population growth during the decade of 2000 to 2010 was 12.0 percent, down from 20.4 percent growth from the previous decade. Oregon’s rankings in terms of decennial growth rate dropped from 11th between 1990-2000 to 18th between 2000 and 2010. Slow population growth during the most recent decade due to double recessions probably cost Oregon one additional seat in the U.S. House of Representatives. Actually, Oregon’s decennial population growth rate during the most recent decade was the second lowest since 1900. The slowest, actually negative, growth was during the 1980s when Oregon was hit hard by another recession. As a result of recent economic downturn and sluggish recovery, Oregon’s population is expected to continue a slow pace of growth in the near future. Based on the current forecast, Oregon’s population will reach 4.25 million in the year 2020 with an annual rate of growth of 1.13 percent between 2012 and 2020.

Oregon’s economic condition heavily influences the state’s population growth. Its economy determines the ability to retain local work force as well as attract job seekers from national and international labor market. As Oregon’s total fertility rate remains below the replacement level and deaths continue to rise due to ageing population, long-term growth comes mainly from net in-migration. Working-age adults come to Oregon as long as we have favorable economic and employment environments. During the 1980s, which included a major recession and a net loss of population, net migration contributed to 22 percent of the population change. On the other extreme, net migration accounted for 73 percent of the population change during the booming economy of 1990s. This share of migration to population change declined to 56 percent in 2002 and it was further down to 32 percent in 2010. As a sign of slow to modest economic gain, the ratio of net migration-to-population change will increase gradually and will reach 76 percent by the end of the forecast horizon. Although economy and employment situation in Oregon looked stagnant in the recent past, migration situation was not similar to the early 1980s pattern of negative net migration. Potential Oregon out-migrants had no better place to go since other states were also in the same boat in terms of economy and employment.

Age structure and its change affect employment, state revenue, and expenditure. Demographics are the major budget drivers, which are modified by policy choices on service coverage and delivery. Growth in many age groups will show the effects of the baby-boom and their echo generations during the period of 2012-2020. It will also reflect demographics impacted by the depression era birth cohort combined with diminished migration of the working age population and elderly retirees. After a period of slow growth during the 1990s and early 2000s, the elderly population (65+) has picked up a faster pace of growth and will surge as the baby-boom generation continue to enter this age group. The average annual growth of the elderly population will be 4.1 percent during the forecast period as the boomers continue to enter retirement age. However, the youngest elderly (aged 65-74) will grow at an extremely fast pace during the forecast period, averaging 4.9 percent annual rate of growth due to the direct impact of the baby-boom generation entering the retirement age and smaller pre-babyboom cohort exiting the 65-74 age group. Reversing several years of shrinking population, the elderly aged 75-84 started to show a positive growth as the effect of depression era birth-cohort will dissipate. A faster pace of growth of population in this age group will begin once the baby-boom generation starts to mature into 65-74 age group. The oldest elderly (aged 85+) will continue to grow at a moderately but steady rate due to the combination of cohort change, continued positive net migration, and improving longevity. The average annual rate of growth for this oldest elderly over the forecast horizon will be 1.3 percent.

As the baby-boom generation matures out of oldest working-age cohort combined with slowing net migration, the once fast-paced growth of population aged 45-64 has gradually tapered off to below zero percent rate of growth by 2012 and will remain at slow or below zero growth phase for several years. The size of this older working-age population will remain virtually unchanged at the beginning to the end of the forecast period. The 25-44 age group population is recovering from several years of declining and slow growing trend. The decline was mainly due to the exiting baby-boom cohort. This age group has seen positive growth starting in the year 2004 and will increase by 1.4 percent annual average rate during the forecast horizon. The young adult population (aged 18-24) will change only a little over the forecast period and remain virtually unchanged for most of the years into the future. Although the slow or stagnant growth of college-age population (age 18-24), in general, tend to ease the pressure on public spending on higher education, college enrollment typically goes up during the time of high

56

unemployment and scarcity of well-paying jobs when even the older people flock back to college to better position themselves in a tough job market. The growth in K-12 population (aged 5-17) will remain low which will translate into slow growth in school enrollments. This school-age population has actually declined in size in recent years and will grow in the future at well below the state average. The growth rate for children under the age of five will remain below zero percent in the near future and will see positive growth only after 2014. Although the number of children under the age of five will decline slightly in the near future, the demand for child care services and pre-Kindergarten program will be additionally determined by the labor force participation and poverty rates of the parents. Overall, elderly population over age 65 will increase rapidly whereas population groups under age 65 will experience slow growth in the coming years. Hence, based solely on demographics of Oregon, demand for public services geared towards children and young adults will likely to increase at a slower pace, whereas demand for elderly care and services will increase rapidly.

Procedure and Assumptions

Population forecasts by age and sex are developed using the cohort-component projection procedure. The population by single year of age and sex is projected based on the specific assumptions of vital events and migrations. Oregon’s estimated population of July 1, 2010 based on the most recent decennial census is the base for the forecast. To explain the cohort-component projection procedure very briefly, the forecasting model "survives" the initial population distribution by age and sex to the next age-sex category in the following year, and then applies age-sex-specific birth and migration rates to the mid-period population. Further iterations subject the in-and-out migrants to the same mortality and fertility rates.

Populations by age-sex detail for the years 2000 through 2009, called intercensal estimates, in the following tables are developed by OEA based on 2000 and 2010 censuses and postcensal totals from the Population Research Center, Portland State University. The numbers of births and deaths through 2009-12 are from Oregon's Center for Health Statistics. The total populations for the period 2013 to 2020 are generated as part of the economic and revenue forecast of OEA.

Annual numbers of births are determined from the age-specific fertility rates projected based on Oregon's past trends and past and projected national trends. Oregon's total fertility rate is assumed to remain below the replacement level of 2.1 children per woman during the forecast period, tracking at slightly lower than the national rate.

Life Table survival rates are developed for the year 2008. Male and female life expectancies for the 2010-2020 period are projected based on the past three decades of trends and national projected life expectancies. Gradual improvements in life expectancies are expected over the forecast period. At the same time, the difference between the male and female life expectancies will continue to shrink. The male life expectancy at births of 77.1 and the female life expectancy of 81.7 in 2010 are projected to improve to 78.2 years for males and 82.7 years for females by the year 2020.

Estimates and forecasts of the number of net migrations are based on the residuals from the difference between population change and natural increase (births minus deaths) in a given forecast period. The migration forecasting model uses Oregon’s employment, unemployment rates, income/wage data from Oregon and other states, and past trends. Distribution of migrants by age and sex is based on detailed data from the American Community Survey. The annual net migration between 2012 and 2020 is expected to remain in the range of 22,100 to 39,500, averaging 33,730 persons annually. Slowdown in Oregon’s economy in the recent years resulted in smaller net migration and slow population growth. Estimated population growth and net migration rates in 2010 and 2011 were the lowest in over two decades. This slow population growth, as a result of slow economy and high unemployment rate, is expected to continue in the near future. Migration is intrinsically related to economy and employment situation of the state. Still, high unemployment and job loss in the recent past have impacted net migration and population growth, but not to the extent in the early 1980s. Main reason for this is the fact that other states of potential destination for Oregon out-migrants were not faring any better either. Hence the potential out-migrants have very limited destination choices. As Oregon’s economy gets better, net migration and population growth will increase. However, the growth will not look like high growth period of 1990s.

57

Table C.1 Population Forecasts Component of Change 1980-2020

STATE OF OREGONPOPULATION FORECASTS

COMPONENTS OF CHANGE 1980 -2020

Year Population Change Births Deaths Natural Net Migration(July 1) Population Number Percent Number Rate/1000 Number Rate/1000 Increase Number Rate/1000------ ----------- ----------- -------- ----------- -------- ----------- -------- ----------- ----------- --------1980 2,641,200 --- --- --- --- --- --- --- --- --- 1981 2,668,000 26,800 1.01 43,196 16.27 21,870 8.24 21,326 5,474 2.061982 2,664,900 -3,100 -0.12 42,261 15.85 21,548 8.08 20,713 -23,813 -8.931983 2,653,100 -11,800 -0.44 40,378 15.19 22,039 8.29 18,339 -30,139 -11.331984 2,666,600 13,500 0.51 39,611 14.89 22,702 8.54 16,909 -3,409 -1.281985 2,672,600 6,000 0.23 39,296 14.72 23,531 8.81 15,765 -9,765 -3.66

1980-1985 31,400 204,742 111,690 93,052 -61,652

1986 2,683,500 10,900 0.41 39,332 14.69 23,403 8.74 15,929 -5,029 -1.881987 2,701,000 17,500 0.65 38,702 14.38 23,695 8.80 15,007 2,493 0.931988 2,741,300 40,300 1.49 39,120 14.38 24,752 9.10 14,368 25,932 9.531989 2,790,600 49,300 1.80 40,648 14.70 24,705 8.93 15,943 33,357 12.061990 2,860,400 69,800 2.50 42,008 14.87 24,763 8.76 17,245 52,555 18.60

1985-1990 187,800 199,810 121,318 78,492 109,308

1991 2,928,500 68,100 2.38 42,682 14.75 24,944 8.62 17,738 50,362 17.401992 2,991,800 63,300 2.16 42,427 14.33 25,166 8.50 17,261 46,039 15.551993 3,060,400 68,600 2.29 41,442 13.69 26,543 8.77 14,899 53,701 17.751994 3,121,300 60,900 1.99 41,487 13.42 27,564 8.92 13,923 46,977 15.201995 3,184,400 63,100 2.02 42,426 13.46 27,552 8.74 14,874 48,226 15.30

1990-1995 324,000 210,464 131,769 78,695 245,305

1996 3,247,100 62,700 1.97 43,196 13.43 28,768 8.95 14,428 48,272 15.011997 3,304,300 57,200 1.76 43,625 13.32 29,201 8.91 14,424 42,776 13.061998 3,352,400 48,100 1.46 44,696 13.43 28,705 8.62 15,991 32,109 9.651999 3,393,900 41,500 1.24 45,188 13.40 29,848 8.85 15,340 26,160 7.762000 3,431,100 37,200 1.10 45,534 13.34 28,909 8.47 16,625 20,575 6.03

1995-2000 246,700 222,239 145,431 76,808 169,892

2001 3,470,400 39,300 1.15 45,536 13.20 29,934 8.67 15,602 23,698 6.872002 3,502,600 32,200 0.93 44,995 12.91 30,828 8.84 14,167 18,033 5.172003 3,538,600 36,000 1.03 45,686 12.98 30,604 8.69 15,082 20,918 5.942004 3,578,900 40,300 1.14 45,599 12.81 30,721 8.63 14,878 25,422 7.142005 3,626,900 48,000 1.34 45,892 12.74 30,717 8.53 15,175 32,825 9.11

2000-2005 195,800 227,708 152,804 74,904 120,896

2006 3,685,200 58,300 1.61 46,946 12.84 30,771 8.42 16,175 42,125 11.522007 3,739,400 54,200 1.47 49,404 13.31 31,396 8.46 18,008 36,192 9.752008 3,784,200 44,800 1.20 49,659 13.20 32,008 8.51 17,651 27,149 7.222009 3,815,800 31,600 0.84 47,960 12.62 31,382 8.26 16,578 15,022 3.952010 3,837,300 21,500 0.56 46,256 12.09 31,689 8.28 14,567 6,933 1.81

2005-2010 210,400 240,225 157,246 82,979 127,421

2011 3,857,625 20,325 0.53 45,381 11.80 32,437 8.43 12,944 7,381 1.922012 3,883,735 26,110 0.68 44,897 11.60 32,968 8.52 11,929 14,181 3.662013 3,917,800 34,066 0.88 45,286 11.61 33,318 8.54 11,968 22,098 5.672014 3,957,600 39,800 1.02 45,798 11.63 33,700 8.56 12,098 27,701 7.032015 4,001,600 43,999 1.11 46,373 11.65 34,146 8.58 12,227 31,772 7.98

2010-2015 164,300 227,736 166,570 61,166 103,133

2016 4,048,800 47,200 1.18 47,002 11.68 34,654 8.61 12,349 34,851 8.662017 4,098,400 49,600 1.23 47,692 11.71 35,192 8.64 12,500 37,100 9.112018 4,149,100 50,700 1.24 48,368 11.73 35,765 8.67 12,602 38,098 9.242019 4,200,500 51,400 1.24 49,049 11.75 36,385 8.72 12,664 38,736 9.282020 4,252,600 52,100 1.24 49,711 11.76 37,090 8.78 12,621 39,479 9.34

2015-2020 251,000 241,822 179,086 62,736 188,265

1980-1990 219,200 404,552 233,008 171,544 47,6561990-2000 570,700 432,703 277,200 155,503 415,197 41,520 2000-2010 406,200 467,933 310,050 157,883 248,317 24,832 2010-2020 415,300 469,558 345,656 123,902 291,398 29,140

Sources: 1980-1999 population - U.S. Census Bureau; 2000-2010 population - intercensal estimates by Office of Economic Analysis basedon 2010 Census and post-censal estimates by Population Research Center, PSU; births and deaths 1980-12: Oregon Center for Health Statistics.

58

Table C.2 Population Forecasts by Age and Sex: 2000-2020

2001 2002 2003 2004 2005Age Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total0-4 114,742 109,903 224,645 115,219 109,865 225,084 116,118 110,533 226,652 117,038 111,315 228,353 117,847 112,161 230,008

5- 9 118,879 113,240 232,119 117,908 112,625 230,533 117,595 112,522 230,117 118,055 112,983 231,038 118,737 113,851 232,58810-14 125,950 119,470 245,421 126,474 120,344 246,818 127,007 120,408 247,415 126,169 119,728 245,898 124,732 118,604 243,33615-19 127,311 119,879 247,190 127,250 119,862 247,112 126,490 120,236 246,726 127,484 121,227 248,711 129,634 122,978 252,61220-24 120,814 115,792 236,605 122,925 118,001 240,926 125,433 119,922 245,356 127,001 121,951 248,952 128,090 122,777 250,86725-29 119,436 111,809 231,245 119,216 112,937 232,153 120,690 114,847 235,536 122,799 117,484 240,282 125,208 121,121 246,32930-34 125,882 117,768 243,651 127,842 119,417 247,259 128,373 120,485 248,858 127,650 119,951 247,601 126,179 119,324 245,50335-39 125,463 122,883 248,346 123,019 119,340 242,360 121,225 116,792 238,017 121,489 116,438 237,927 124,789 119,125 243,91440-44 134,585 136,761 271,346 133,102 135,121 268,224 131,876 133,467 265,343 131,106 132,016 263,121 129,401 129,428 258,82945-49 136,214 138,948 275,162 136,992 140,305 277,297 136,336 140,343 276,679 134,864 139,381 274,245 134,310 139,320 273,62950-54 125,826 127,295 253,120 126,548 128,354 254,902 129,544 132,212 261,756 132,767 136,330 269,097 135,022 138,899 273,92155-59 89,314 91,758 181,072 98,235 100,967 199,202 103,863 106,596 210,460 109,932 112,923 222,855 117,120 120,794 237,91460-64 67,383 70,539 137,922 70,666 74,175 144,841 75,490 79,114 154,604 80,095 83,740 163,835 84,062 88,300 172,36165-69 53,861 59,438 113,299 54,996 60,295 115,291 56,889 62,083 118,972 59,083 64,273 123,356 61,643 66,384 128,02770-74 48,249 57,290 105,539 47,788 56,535 104,323 47,448 55,941 103,389 47,523 55,493 103,016 48,249 55,650 103,89975-79 40,503 54,397 94,900 40,508 53,697 94,204 40,627 52,917 93,545 40,403 52,009 92,412 40,366 51,512 91,87880-84 27,465 41,513 68,978 28,398 42,507 70,905 28,798 43,326 72,124 29,266 44,164 73,430 29,725 44,474 74,199 85+ 19,293 40,549 59,843 19,854 41,313 61,167 20,727 42,323 63,050 21,444 43,325 64,769 22,398 44,689 67,087

Total 1,721,170 1,749,230 3,470,400 1,736,939 1,765,661 3,502,600 1,754,532 1,784,068 3,538,600 1,774,167 1,804,733 3,578,900 1,797,511 1,829,389 3,626,900Mdn. Age 35.3 37.8 36.6 35.5 38.0 36.8 35.7 38.2 36.9 35.8 38.4 37.1 36.0 38.5 37.2

2006 2007 2008 2009 2010Age Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total0-4 118,832 113,050 231,882 121,058 115,102 236,160 122,723 116,618 239,340 123,056 116,873 239,929 122,327 116,130 238,457

5- 9 119,959 115,315 235,274 120,925 115,818 236,743 121,906 116,639 238,545 122,109 116,793 238,901 121,539 116,369 237,90810-14 124,400 118,240 242,639 124,017 118,145 242,162 124,144 118,401 242,545 124,495 118,646 243,140 124,508 118,732 243,24115-19 131,680 124,886 256,567 133,027 126,562 259,588 134,019 127,039 261,058 133,094 126,245 259,339 131,126 124,540 255,66720-24 129,625 123,869 253,494 129,491 124,047 253,538 128,090 124,102 252,192 128,034 124,294 252,328 128,787 124,903 253,68925-29 128,110 125,220 253,330 131,446 128,889 260,335 134,251 131,308 265,559 134,893 132,724 267,617 134,019 131,816 265,83530-34 126,016 119,767 245,782 126,936 121,971 248,907 128,841 124,231 253,072 130,499 126,264 256,763 131,489 128,325 259,81435-39 128,779 122,827 251,606 131,387 125,260 256,647 132,046 126,581 258,627 130,807 125,534 256,341 128,070 123,596 251,66540-44 126,728 126,664 253,391 124,917 123,759 248,677 123,362 121,440 244,802 123,395 120,853 244,249 125,969 122,843 248,81145-49 135,135 139,543 274,678 134,349 138,533 272,882 133,523 137,181 270,705 132,802 135,635 268,437 130,825 132,538 263,36350-54 136,187 140,978 277,165 137,589 142,901 280,489 137,266 143,176 280,443 135,862 142,064 277,926 135,129 141,565 276,69355-59 124,581 129,098 253,680 125,683 130,760 256,444 128,665 134,868 263,533 131,454 138,782 270,236 133,011 140,802 273,81260-64 87,811 92,304 180,115 97,117 102,054 199,171 102,948 107,873 210,821 108,952 114,138 223,090 115,236 121,045 236,28165-69 64,860 69,850 134,710 68,563 73,945 142,509 73,612 79,164 152,776 78,191 83,768 161,959 81,854 87,917 169,77170-74 49,222 55,999 105,221 50,569 57,052 107,622 52,510 58,915 111,425 54,604 61,042 115,646 56,925 62,949 119,87475-79 40,359 51,026 91,385 40,218 50,594 90,812 40,073 50,211 90,285 40,236 49,905 90,141 40,932 50,101 91,03480-84 29,996 44,406 74,402 30,251 44,085 74,336 30,464 43,606 74,069 30,361 43,011 73,372 30,391 42,734 73,126 85+ 23,554 46,323 69,877 24,585 47,794 72,379 25,325 49,078 74,403 26,014 50,369 76,383 26,800 51,458 78,258

Total 1,825,834 1,859,366 3,685,200 1,852,129 1,887,271 3,739,400 1,873,769 1,910,431 3,784,200 1,888,859 1,926,941 3,815,800 1,898,938 1,938,362 3,837,300Mdn. Age 36.3 38.6 37.3 36.5 38.7 37.5 36.7 38.8 37.8 37.0 39.1 38.0 37.2 39.4 38.3

2011 2012 2013 2014 2015Age Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total0-4 121,094 115,082 236,177 119,525 113,352 232,878 118,418 111,965 230,383 118,113 112,042 230,156 118,432 112,244 230,676

5- 9 121,760 115,893 237,653 122,723 116,903 239,626 123,978 117,928 241,906 124,575 117,922 242,497 125,114 118,085 243,19910-14 124,068 119,044 243,112 123,593 118,290 241,883 123,352 118,190 241,542 123,304 118,372 241,676 122,763 118,093 240,85615-19 129,078 121,924 251,002 127,537 120,584 248,121 126,611 119,836 246,447 126,651 119,832 246,484 127,249 120,326 247,57520-24 130,576 126,680 257,256 132,867 128,777 261,644 135,220 130,560 265,779 136,367 131,524 267,890 136,389 131,400 267,78925-29 133,298 130,833 264,131 132,469 129,950 262,419 132,395 130,283 262,678 134,061 132,260 266,321 136,662 135,457 272,11930-34 133,514 130,756 264,270 135,703 133,357 269,060 137,250 135,049 272,299 139,559 137,165 276,724 140,552 137,982 278,53435-39 125,923 121,787 247,710 126,016 122,283 248,299 128,643 124,338 252,981 130,690 126,514 257,203 134,057 129,652 263,70940-44 128,970 125,349 254,319 130,797 126,601 257,398 131,448 127,404 258,851 130,876 126,523 257,399 129,625 124,943 254,56745-49 127,764 128,560 256,324 125,373 125,013 250,386 123,743 122,203 245,946 124,060 121,430 245,489 126,594 123,370 249,96450-54 134,685 140,685 275,370 133,452 139,251 272,704 132,058 137,577 269,635 131,450 136,067 267,516 129,705 133,298 263,00355-59 134,057 142,357 276,414 134,484 143,087 277,571 134,427 142,755 277,182 133,277 141,930 275,206 132,989 141,934 274,92360-64 121,429 127,818 249,247 122,921 129,547 252,468 124,934 132,784 257,718 127,678 136,691 264,369 130,137 139,359 269,49665-69 84,427 90,851 175,278 92,091 98,797 190,888 97,923 105,070 202,993 103,373 110,444 213,818 109,600 117,393 226,99370-74 59,391 65,610 125,000 62,313 69,030 131,343 66,924 73,747 140,671 70,958 78,250 149,209 74,459 82,252 156,71175-79 41,512 50,107 91,619 42,559 50,757 93,316 44,045 52,137 96,183 46,149 54,196 100,345 48,244 56,140 104,38480-84 30,431 42,276 72,707 30,447 41,797 72,244 30,626 41,240 71,866 30,851 40,805 71,656 31,506 40,914 72,420 85+ 27,718 52,319 80,037 28,529 52,957 81,486 29,185 53,555 82,741 29,737 53,905 83,643 30,458 54,223 84,681

Total 1,909,694 1,947,931 3,857,625 1,923,400 1,960,335 3,883,735 1,941,178 1,976,623 3,917,800 1,961,729 1,995,871 3,957,600 1,984,536 2,017,064 4,001,600Mdn. Age 37.4 39.7 38.5 37.6 39.9 38.7 37.8 40.0 38.9 38.0 40.1 39.0 38.1 40.2 39.1

2016 2017 2018 2019 2020Age Male Female Total Male Female Total Male Female Total Male Female Total Male Female Total0-4 119,682 113,208 232,891 121,303 114,590 235,893 122,951 116,023 238,974 124,719 117,634 242,353 126,512 119,304 245,815

5- 9 124,686 117,612 242,297 123,960 116,514 240,474 123,447 115,595 239,042 123,372 115,527 238,898 123,861 115,808 239,66910-14 123,357 118,096 241,453 124,818 119,690 244,508 126,425 121,123 247,548 127,264 121,381 248,645 127,990 121,739 249,72915-19 127,408 120,999 248,407 127,535 120,665 248,200 127,733 120,890 248,623 128,010 121,342 249,352 127,637 121,211 248,84820-24 135,623 130,118 265,741 135,019 129,720 264,739 134,700 129,589 264,289 135,169 130,009 265,178 136,114 130,850 266,96425-29 140,820 140,362 281,183 145,090 145,075 290,165 148,886 148,697 297,583 150,979 150,873 301,852 151,482 151,348 302,83030-34 141,923 139,037 280,960 142,751 139,828 282,579 143,812 141,367 285,179 146,420 144,357 290,777 149,779 148,416 298,19435-39 137,226 132,709 269,935 140,403 135,863 276,266 142,629 137,929 280,558 145,445 140,322 285,767 146,767 141,319 288,08740-44 128,178 123,619 251,798 128,841 124,507 253,348 131,908 126,854 258,762 134,269 129,247 263,516 137,888 132,551 270,43945-49 130,342 126,348 256,690 132,766 128,027 260,794 133,804 129,085 262,888 133,483 128,367 261,850 132,380 126,878 259,25850-54 127,257 129,954 257,212 125,350 126,753 252,103 124,043 124,221 248,265 124,607 123,644 248,251 127,334 125,857 253,19255-59 133,140 141,893 275,033 132,370 141,099 273,469 131,289 139,836 271,125 130,901 138,592 269,493 129,299 135,836 265,13460-64 132,099 141,680 273,779 133,275 143,046 276,322 133,736 143,161 276,897 132,946 142,640 275,586 132,895 142,846 275,74265-69 116,151 124,488 240,638 118,206 126,674 244,880 120,594 130,206 250,800 123,563 134,284 257,848 126,169 137,075 263,24570-74 77,138 85,251 162,389 84,587 93,049 177,636 90,317 99,216 189,533 95,579 104,449 200,028 101,463 111,115 212,57875-79 50,492 58,690 109,181 53,133 61,922 115,055 57,231 66,318 123,549 60,802 70,488 131,290 63,893 74,158 138,05280-84 32,199 41,076 73,275 33,231 41,761 74,992 34,565 43,027 77,592 36,346 44,827 81,173 38,136 46,529 84,664 85+ 31,222 54,715 85,937 31,911 55,065 86,976 32,572 55,319 87,892 33,172 55,472 88,644 34,168 55,993 90,161

Total 2,008,945 2,039,854 4,048,800 2,034,552 2,063,848 4,098,400 2,060,643 2,088,457 4,149,100 2,087,045 2,113,456 4,200,500 2,113,766 2,138,834 4,252,600Mdn. Age 38.3 40.3 39.3 38.4 40.4 39.4 38.5 40.5 39.5 38.7 40.6 39.6 38.9 40.7 39.8

Oregon's Population Forecasts by Age and Sex: 2001-2020 (July 1 population)(July 1 Population)

State of Oregon

59

Table C.3 Population of Oregon: 1980-2020

Table C.4 Children: Ages 0-4 Table C.5 School Age Population: Ages 5-17

Table C.6 Young Adult Population: Ages 18-24

Year Total(July 1) Population Number Percent

--------- ---------------- ---------------- ----------------1990 2,860,400 - -1991 2,928,500 68,100 2.38%1992 2,991,800 63,300 2.16%1993 3,060,400 68,600 2.29%1994 3,121,300 60,900 1.99%1995 3,184,400 63,100 2.02%1996 3,247,100 62,700 1.97%1997 3,304,300 57,200 1.76%1998 3,352,400 48,100 1.46%1999 3,393,900 41,500 1.24%2000 3,431,100 37,200 1.10%2001 3,470,400 39,300 1.15%2002 3,502,600 32,200 0.93%2003 3,538,600 36,000 1.03%2004 3,578,900 40,300 1.14%2005 3,626,900 48,000 1.34%2006 3,685,200 58,300 1.61%2007 3,739,400 54,200 1.47%2008 3,784,200 44,800 1.20%2009 3,815,800 31,600 0.84%2010 3,837,300 21,500 0.56%2011 3,857,625 20,325 0.53%2012 3,883,735 26,110 0.68%2013 3,917,800 34,066 0.88%2014 3,957,600 39,800 1.02%2015 4,001,600 43,999 1.11%2016 4,048,800 47,200 1.18%2017 4,098,400 49,600 1.23%2018 4,149,100 50,700 1.24%2019 4,200,500 51,400 1.24%2020 4,252,600 52,100 1.24%

Change from previous year

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020

Perc

ent C

hang

e

Popu

latio

n

Year

Oregon's Population and Annual Percent Change, 1950-2020

Forecast

Annual Percent Change

Total Population

Year(July 1) Population Number Percent Population Number Percent Population Number Percent

--------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------1980 199,525 --- --- 524,446 --- --- 329,407 --- ---1990 209,638 10,113 5.07% 532,727 8,281 1.58% 268,134 -61,273 -18.60%2000 223,207 13,569 6.47% 624,316 91,589 17.19% 330,328 62,194 23.20%2001 224,645 1,438 0.64% 624,675 358 0.06% 336,660 6,333 1.92%2002 225,084 439 0.20% 624,611 -64 -0.01% 340,778 4,118 1.22%2003 226,652 1,568 0.70% 624,349 -262 -0.04% 345,266 4,487 1.32%2004 228,353 1,701 0.75% 625,461 1,112 0.18% 349,138 3,873 1.12%2005 230,008 1,655 0.72% 628,326 2,865 0.46% 351,076 1,938 0.55%2006 231,882 1,874 0.81% 633,646 5,320 0.85% 354,328 3,252 0.93%2007 236,160 4,278 1.85% 635,720 2,074 0.33% 356,311 1,983 0.56%2008 239,340 3,180 1.35% 635,372 -348 -0.05% 358,967 2,656 0.75%2009 239,929 589 0.25% 633,575 -1,797 -0.28% 360,134 1,166 0.32%2010 238,457 -1,472 -0.61% 630,741 -2,835 -0.45% 359,764 -370 -0.10%2011 236,177 -2,280 -0.96% 628,350 -2,391 -0.38% 360,673 909 0.25%2012 232,878 -3,299 -1.40% 628,673 324 0.05% 362,601 1,928 0.53%2013 230,383 -2,494 -1.07% 629,997 1,324 0.21% 365,676 3,075 0.85%2014 230,156 -228 -0.10% 631,123 1,126 0.18% 367,424 1,748 0.48%2015 230,676 520 0.23% 631,853 730 0.12% 367,565 141 0.04%2016 232,891 2,215 0.96% 632,316 462 0.07% 365,583 -1,982 -0.54%2017 235,893 3,003 1.29% 633,196 880 0.14% 364,725 -858 -0.23%2018 238,974 3,080 1.31% 633,608 412 0.07% 365,895 1,170 0.32%2019 242,353 3,379 1.41% 634,819 1,211 0.19% 367,254 1,359 0.37%2020 245,815 3,462 1.43% 637,587 2,768 0.44% 367,624 370 0.10%

% Change from previous decade/yr.% Change from previous decade/yr. % Change from previous decade/yr.

60

Table C.7 Criminally At Risk Population (males): Ages 15-39

Table C.8 Prime Wage Earners: Ages 25-44

Table C.9 Older Wage Earners: Ages 45-64

Table C.10 Elderly Population by Age Group

Year(July 1) Population Number Percent Population Number Percent Population Number Percent

--------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------1980 561,931 --- --- 790,750 --- --- 491,249 --- ---1990 544,738 -17,193 -3.06% 926,326 135,576 17.15% 531,181 39,932 8.13%2000 616,988 72,250 13.26% 996,500 70,174 7.58% 817,510 286,329 53.90%2001 618,906 1,918 0.31% 994,587 -1,913 -0.19% 847,276 29,766 3.64%2002 620,252 1,347 0.22% 989,996 -4,591 -0.46% 876,242 28,966 3.42%2003 622,211 1,959 0.32% 987,755 -2,241 -0.23% 903,499 27,257 3.11%2004 626,423 4,212 0.68% 988,932 1,177 0.12% 930,032 26,533 2.94%2005 633,901 7,478 1.19% 994,575 5,644 0.57% 957,826 27,793 2.99%2006 644,210 10,309 1.63% 1,004,110 9,535 0.96% 985,638 27,813 2.90%2007 652,287 8,077 1.25% 1,014,565 10,455 1.04% 1,008,986 23,348 2.37%2008 657,248 4,961 0.76% 1,022,060 7,495 0.74% 1,025,501 16,515 1.64%2009 657,327 79 0.01% 1,024,971 2,911 0.28% 1,039,689 14,188 1.38%2010 653,491 -3,836 -0.58% 1,026,126 1,155 0.11% 1,050,150 10,461 1.01%2011 652,389 -1,102 -0.17% 1,030,430 4,304 0.42% 1,057,355 7,204 0.69%2012 654,592 2,203 0.34% 1,037,176 6,747 0.65% 1,053,129 -4,226 -0.40%2013 660,118 5,526 0.84% 1,046,809 9,633 0.93% 1,050,480 -2,648 -0.25%2014 667,328 7,210 1.09% 1,057,647 10,838 1.04% 1,052,581 2,101 0.20%2015 674,910 7,582 1.14% 1,068,930 11,283 1.07% 1,057,386 4,805 0.46%2016 683,001 8,092 1.20% 1,083,876 14,946 1.40% 1,062,714 5,328 0.50%2017 690,799 7,798 1.14% 1,102,358 18,482 1.71% 1,062,688 -26 0.00%2018 697,760 6,961 1.01% 1,122,082 19,724 1.79% 1,059,175 -3,513 -0.33%2019 706,022 8,261 1.18% 1,141,912 19,830 1.77% 1,055,179 -3,996 -0.38%2020 711,778 5,757 0.82% 1,159,550 17,638 1.54% 1,053,325 -1,854 -0.18%

% Change from previous decade/yr. % Change from previous decade/yr. % Change from previous decade/yr.

Year (July 1) Ages 65+

%Change from previous

decade/yr. Ages 65-74

%Change from previous

decade/yr. Ages 75-84

%Change from previous

decade/yr. Ages 85+

%Change from previous

decade/yr.--------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------

1980 305,841 --- 185,863 --- 91,137 --- 28,841 ---1990 392,369 28.29% 224,772 20.93% 128,813 41.34% 38,784 34.48%2000 439,239 11.95% 218,997 -2.57% 162,187 25.91% 58,055 49.69%2001 442,558 0.76% 218,838 -0.07% 163,878 1.04% 59,843 3.08%2002 445,890 0.75% 219,614 0.35% 165,109 0.75% 61,167 2.21%2003 451,080 1.16% 222,361 1.25% 165,669 0.34% 63,050 3.08%2004 456,984 1.31% 226,373 1.80% 165,842 0.10% 64,769 2.73%2005 465,089 1.77% 231,926 2.45% 166,077 0.14% 67,087 3.58%2006 475,596 2.26% 239,931 3.45% 165,787 -0.17% 69,877 4.16%2007 487,657 2.54% 250,131 4.25% 165,148 -0.39% 72,379 3.58%2008 502,959 3.14% 264,201 5.63% 164,354 -0.48% 74,403 2.80%2009 517,502 2.89% 277,606 5.07% 163,513 -0.51% 76,383 2.66%2010 532,062 2.81% 289,645 4.34% 164,159 0.40% 78,258 2.45%2011 544,641 2.36% 300,279 3.67% 164,326 0.10% 80,037 2.27%2012 569,277 4.52% 322,232 7.31% 165,560 0.75% 81,486 1.81%2013 594,454 4.42% 343,664 6.65% 168,049 1.50% 82,741 1.54%2014 618,670 4.07% 363,026 5.63% 172,000 2.35% 83,643 1.09%2015 645,189 4.29% 383,704 5.70% 176,804 2.79% 84,681 1.24%2016 671,420 4.07% 403,027 5.04% 182,456 3.20% 85,937 1.48%2017 699,539 4.19% 422,516 4.84% 190,047 4.16% 86,976 1.21%2018 729,367 4.26% 440,334 4.22% 201,141 5.84% 87,892 1.05%2019 758,983 4.06% 457,876 3.98% 212,463 5.63% 88,644 0.86%2020 788,699 3.92% 475,822 3.92% 222,716 4.83% 90,161 1.71%