State Journal: Aggressive offense; Oregon windfall

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A Kansas battle over taxes and school finance, which has been waged with growing political intensity for more than a year, got even hotter this month after Gov. Joan Finney issued a double-barreled attack on the state's education establishment.

At a press conference, Ms. Finney blasted local school boards for raising property taxes by $76.5 million this year.

"This irresponsible action of Kansas school districts is nothing more than a concerted attempt to blackmail the state into raising state taxes to pour more state aid into schools," she said.

"As Governor, I owe the Kansas taxpayers an aggressive offense against this conspiracy to force more state spending for schools," Ms. Finney vowed.

Earlier this year, Ms. Finney vetoed a bill to increase state aid to schools, as well as a measure to raise state sales and income taxes. She signed, however, a bill allowing local districts to increase their budgets by up to 2.25 percent.

Ms. Finney this month charged that school boards were exceeding the allowable increases, and said local officials were trying to blame their tax hikes on her vetoes.

"They are engaged in a gross misrepresentation of the facts and disrespect for the public trust," the Governor said.

Education spokesmen denied Ms. Finney's allegations and accused her of trying to make the schools into scapegoats for public unrest over taxes.


While the recession is forcing many states these days to scramble to cover budget gaps caused by lower-than-expected revenues, Oregon officials are in the happy position of getting more money for the schools than they had anticipated.

Oregon voters last fall approved a ballot initiative limiting and later reducing property-tax rates. The measure also required that the funds lost by the schools by made up by the state, which as a result faced a need for an additional $1.7 billion in revenues over the next biennium.

New data indicate, however, that local school systems may get as much as $80 million more in property-tax revenues than projected over the two-year period, even with the curbs on rates. That means the burden on the state will be reduced by the same amount.

The reason, explained Terry Drake, a legislative analyst, is that Oregon real estate is booming. "We are seeing a dramatic increase in the assessed value of homes," which in turn boosts tax revenues, he said.

"We are getting inundated with high-income retirees and high-skilled middle-aged workers," who are able to bid up home prices, Mr. Drake said, adding, "The Californians are coming in droves." --H.D.

Vol. 11, Issue 11, Page 16

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