Oregon Department of Human Services Director's Message
August 19, 2010 DHS Director's messages on the web
To: All DHS and OHA employees
From: Bruce Goldberg, M.D., Director

Budget update

"Life's challenges are not supposed to paralyze you, they're supposed to help you discover who you are."
~Bernice Johnson Reagon

As you may have already heard, the state economic forecast will be released next week. State economists will provide the quarterly analysis of revenues that will be available to provide state services through the end of the budget cycle that ends in June 2011. Earlier this week, Governor Kulongoski released word that the news will not be good -- revenues are expected to be $200 to $500 million less than predicted in the previous forecast.

This reduction would be in addition to the $577 million shortfall that resulted in reductions to DHS services, education and other programs.

As of today, we do not yet know what the final figure will be or what if any further budget reductions may be coming our way. At the same time that we are getting the bad revenue news, the state will be receiving about $260 million in federal funds through enhanced Medicaid dollars (approximately $142 million) and through aid to schools (about $118 million). So how these events will interact has yet to be determined.

As I learn more, I will keep you informed.

While this news is difficult, it isn't surprising given the other two pieces of news released this week. The monthly unemployment figures came out, showing that for nine months in a row, Oregon's unemployment rate stayed at about 10.6 percent. Meanwhile, the Children, Adults and Families Division reports that as of last month there are nearly 718,000 people on the Supplemental Nutrition Assistance Program -- an increase of 49 percent over the past two years.

And tomorrow is an unpaid mandatory furlough day for most state employees resulting in reduced wages and rising workloads.

That is the paradoxical reality of our time. The recession means that there are fewer dollars for the vital services that more and more people need to help them through the recession. Services we reduced to seniors, low-income families, and other vulnerable Oregonians. Also, office closures mean that clients may have to wait for some services and reduced staffing means that everyone is carrying a greater workload.

That is the reality -- and the challenge -- that will define us as an organization for years to come. There are some external forces we cannot control, such as the recession. But others we can. The Oregon Health Authority is working to put together a plan for the 2011 Legislature to help contain the cost of health care and make it more affordable and available for us all. Work is also happening in DHS and throughout both agencies to reduce costs in other ways. We continue to reduce administrative overhead and we continue to do our best to reprioritize workload and services in the face of the reality of decreased staff.

I know this is a very difficult time for us all. I also know that in every corner of the agency our staff is working hard to find ways to get through these tough times. My sincere thanks for all you are doing.

That is how we will get through this -- by being smart, creative, and tackling it together.

I will continue to keep you posted over the next weeks about the budget situation as I learn more.

DHS on the web