MEDFORD — The economic downturn was the gorilla in the room at a packed town-hall meeting Monday, with local legislators expressing hope about likely federal stimulus packages for social services and infrastructure improvements, but warning that if the recession worsens, all bets are off.

MEDFORD — The economic downturn was the gorilla in the room at a packed town-hall meeting Monday, with local legislators expressing hope about likely federal stimulus packages for social services and infrastructure improvements, but warning that if the recession worsens, all bets are off.

"The big thing is, we don't know how bad the recession is going to get," said state Sen. Alan Bates, D-Ashland. "Is it a depression like 1932, with falling prices? No one knows. You get a different answer from everyone. We're going to get to Salem, take a big breath and get the revenue forecast in May." As they prepared to leave for the legislative session, Bates and state Rep. Sal Esquivel, R-Medford, told about 125 people at the Central Library in Medford that, if there is excess revenue collected (more than 2 percent over revenue forecasts) there could be some relief from a "kicker" tax refund. But Esquivel cautioned that every time the kicker fund goes up "we go like gangbusters," and then it's down in the next cycle.

Bates, who will chair the Human Services Subcommittee of the budget-writing Ways and Means Committee, said the state expects the infrastructure stimulus package will go toward schools, higher education and transportation. The latter is vital, said Esquivel, for economic development and relocation of business to the state.

Legislators will learn in about March or April if they will get the infrastructure package and how much it will be.

Eric Dziura of the Medford School Board said, "My biggest concern is how far down can the economy go?" News from the capitol, he added, suggests the state revenue shortfall could reach $300 million and that big cuts late in the session "could be devastating."

Bates responded, "The truth is we don't know how deep it's going to go. It could be terrible." However, he noted that "human services will probably be barely OK," although if the state doesn't get the stimulus package in that area by late January or early February, it will have a cash flow problem and have to begin cutting services.

Bemoaning high income tax rates in Oregon, legislators and citizens kicked around the perennial fix of a sales tax, but Esquivel cited California as a bad example of how a sales tax can creep upward relentlessly, and Bates, while he supports it, said he'd only vote for it in exchange for scrapping the income tax.

Bates also faulted the income tax because it declines in bad times, making social services suffer when they are most needed.

Audience members complained about the proposal to tax vehicle mileage and clapped loudly when Esquivel said it punishes drivers who use economy cars and, in any case, doesn't have enough votes to pass the House.

In response to other concerns from the audience, the legislators said fluoridation has fallen from favor and won't pass, and neither will a ban on using cell phones while driving, though a "hands-free" requirement might become law.

Esquivel said driving while phoning or texting "is the equivalent of drunk driving" but Bates added he's not going to "cram (a cell-phone ban) down people's throats." The pair of legislators deftly handled a loud attack on the Latino population by one audience member by saying the key is to require adherence to the proper immigration process and follow the example of Arizona, banning hiring of illegals.

Esquivel said he's half Mexican and resents the stereotype. Bates noted that Canada, because it has a good economy, democracy and educational system, doesn't send a stream of illegal immigrants to the U.S., so the root of the problem is in Mexico.

In response to concerns about treatment and support for Iraq War veterans and their families, which are experiencing high divorce rates from returnees with post-traumatic stress disorder, the legislators, both Vietnam veterans, said they would continue to work on helpful legislation.

Bates said the best thing people can do at the local level it "put pressure on the federal government to end the war. It can be done in three years. It's breaking up families — the divorce rate is 70 percent."

Bates said he hopes the recession ends no later than late 2009 or in 2010 but if it's still there for the biennium after this one (starting in July 2011), then "it's a whole new world, and not a good world."