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New shortfall won't hurt schools this fall, governor promises

The latest shortfall in Oregon revenue will not affect K-12 schools, at least for the moment, Gov. Ted Kulongoski announced today.

The governor made the announcement via press release shortly after state economists delivered gloomy news that the state's budget deficit had grown another $377.5 million.

Federal funds from the recent Ed Jobs legislation will help offset the shortfall for schools.

The governor pledged to maintain school funding at the June level of $5.8 billion.

"With school about to start, we want to assure Oregon families and their school districts that even with this revenue shortfall, there will be stability for school budgets, while also maintaining a responsible level of reserves for the last three quarters of this budget period," Kulongoski said.

In addition to the $118 million in federal schools assistance recently approved by Congress, the governor, Senate President Peter Courtney, D-Salem, and Speaker Dave Hunt, D-Clackamas County, agreed to move about $34 million in state reserve funds to K-12 education when the state Legislature convenes in February.

About two-thirds of the State Education Stability Fund and rainy-day fun will remain in savings to address the uncertainty of the last three revenue forecasts of the 2009-2011 biennium, Kulongoski said.

"We're putting the priorities of Oregon families at the front of the line," said Courtney in a statement. "Our plan keeps the doors of our schools open and the gates of our prisons closed. It maintains care for our senior citizens, assistance for people with disabilities and health care for our most vulnerable. We have taken a deliberate and cautious approach and achieved these priorities without the need for a special session."

School officials said they are moving forward cautiously.

"The news could be better, although it could be worse," said Vicki Robinson, Central Point schools business manager. "There are many 'if's' right now. We know this is probably isn't the last thing we are going to hear on this. There is another revenue forecast in December."

— Paris Achen