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Governor Tina Kotek Orders Immediate Spending Cuts Amid $370 Million Budget Shortfall

Governor Kotek directs agencies to cut spending and suspend non-essential travel to address a $370 million budget gap caused by federal policy changes, with further reductions expected.

  • On September 16, Governor Tina Kotek instructed Oregon agency leaders to implement urgent budget-saving actions and get ready for additional spending cuts in response to a $373 million projected deficit.
  • This shortfall arose after federal policies, including the July passage of H.R. 1 by Congress, reduced Oregon's expected revenue by about $888 million for the 2025-27 budget cycle.
  • Kotek mandated an immediate halt to all unnecessary travel outside the state and instructed agency leaders to reduce spending by keeping positions vacant longer, cutting costs, and postponing new initiatives as lawmakers work on proposals to increase taxes and fees.
  • The projected General Fund revenues dropped from $35.6 billion to $34.9 billion, and Kotek emphasized, “I am directing state agencies to prepare for further reductions” while protecting core services.
  • These measures aim to address the immediate gap, but additional spending targets will be set by Oregon's chief financial officer and further legislative discussions are scheduled during September 29 Legislative Days.
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OPB broke the news in Portland, United States on Tuesday, September 16, 2025.
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