OYA Budget Cut Exercise

The governor asked all state agencies to submit plans for a potential budget cut. Here are details about OYA’s plan.

In response to a major state revenue shortfall due to coronavirus, the governor asked all state agencies, including Oregon Youth Authority, to submit plans for an allotment cut this biennium. This is a set percentage across-the-board reduction to every General Fund appropriation. For OYA, that’s a $27 million cut.

All plans were submitted May 8. Below is a link to a PDF of what OYA submitted:

OYA Budget Cut Exercise Document (PDF)

It’s Just a Planning Exercise … But It Still Hurts

OYA’s submission is a planning exercise, so it doesn’t mean these cuts will happen or even that the list we submitted will be what we are talking about in a month, or in the fall when we get the next revenue forecast.

We won’t know for several months to what extent OYA will need to make cuts.

OYA director Joe O’Leary said in a message Monday to OYA staff, “I recognize that what we are talking about leaves an emotional scar even if the cuts don’t happen. The list will be hurtful for you to see, and I am sorry that we will have to manage the uncertainty for many weeks, even months.”

Our Approach: ‘Share the Pain’

We were tasked not only with coming up with a list of potential budget reductions, but also with prioritizing them.

The OYA leadership team landed on an approach that would “share-the-pain” proportionately across the various OYA departments, if this came to pass.

It means that not only do Facilities Services, Community Services and Central Office take roughly proportionate reductions, but those reductions are layered in chunks that would see each division reduced relatively equally the further you go down the list.

The Prioritized List

OYA leaders prioritized some things we think we could live without if we absolutely had to. However, anything on this list would we difficult to implement while still maintaining the level and types of services we focus on now.

  1. First, we proposed a one-third portion of our residential, foster care, and youth services dollars. This is an amount that is projected to go unused given current patterns so far this biennium. We would prefer to hold on to that just in case usage changes, but it makes sense to put some of this forward first. That’s a significant amount, at $2.4 million.
  2. Second on the list is one-time savings from limiting travel and training and holding open vacant positions. However, that saves only about another $1.3 million.
  3. Only after that do we list positions. At that point, we listed a facility living unit, juvenile parole/probation officers (JPPOs) and juvenile parole/probation assistants (JPPAs), Central Office positions, and another one-third of the youth services/BRS dollars layered in relatively equal chunks. But even with all that, it only gets us to about $9 million.
  4. The rest of the list basically follows that pattern — living units, field offices, same portion of Central. The hard truth is that doesn’t get us to the $27 million target until we put an entire youth correctional facility and transition camp on the list. Also, by that point, we would have to close two field offices and gut Central Office. We put all that toward the very end of the list to reflect that those would be the absolute last things we would eliminate if we had no choice.

If everything on the list were cut, the total would be about 157 positions: or nearly 16% of our staff.

Frequently Asked Questions

What happens next?
We wait for the May 20 revenue forecast to provide more specificity about how much revenue the state has lost. That will help the governor and legislators have a better idea of what the state is facing.

Even if the revenue forecast is really bad, major cuts won’t happen immediately. The governor can direct full cuts or partial allotment cuts. The governor and legislators could use some of Oregon’s rainy-day funds to patch the funding gaps or use a combination of cuts and fund restoration.

What about the coronavirus aid money that Oregon got from the federal government?
OYA was told that money is not to be used to backfill state revenue. It can only be used for expenses directly related to COVID-19. Things may change, but right now, we are being told the funds are not going to solve our budget shortfall.

Will there be layoffs?
Based on what we know now, we think some layoffs and/or reductions in compensation are to be expected. But we think it will more likely happen in combination with other options the governor and legislature land on, such as more targeted reductions, and dipping into reserves. Still, no one can say for sure.

When will I know if my position is affected?
We tried to keep our cut list as general as possible because this is still just an exercise at this point, and we don’t want to scare people unnecessarily.

However, for some positions, this was not possible, and the specific position or body of work is more clearly identified. We will be connecting with those employees and extending support during this uncertain time. Our HR staff is ready to support anyone who may eventually be affected by budget cuts and help them work through their options.

 

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