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How Oregon Spends Money

Senator Doug Whitsett
R- Klamath Falls, District 28

Phone: 503-986-1728 900 Court St. NE, S-303, Salem, Oregon 97301
Email: sen.dougwhitsett@state.or.us
Website: http://www.leg.state.or.us/whitsett
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E-Newsletter 1/13/12
Oregon state revenue collections continue to decline. The November revenue forecast was about $300 million less than the amount predicted to be available at the end of last June. We fully expect that the next revenue forecast in February will predict further reductions.

The primary causes of the decline in revenue are our stagnant economy as well as our ongoing high rates of unemployment and underemployment. Tax revenue is sharply down because businesses are not making as much taxable profit and fewer employees are paying taxes on their wages. In fact, for the past two two-year budget periods, the actual amount of General Fund and Lottery revenue available to spend has decreased.

At the same time the cost of paying state employees will increase by about 7 Ĺ percent during this budget period. When we add inflationary costs, increased debt service on borrowed money plus the expense of expanded case loads the cost of maintaining current state services will swell by about 12 percent.

This sobering reality will result in Oregon state legislators searching for ways to reduce the cost of state government during the upcoming February Legislative Assembly. It is readily apparent that there simply will not be enough money available to continue all programs and services at their current levels. I believe that we must thoughtfully prioritize those programs and services. We then must drastically curtail or eliminate the services and programs determined to be the least important.

In my opinion, the cost of state advertising and communications is one area of spending that is ripe for reductions. A recent investigative report by the Oregonian newspaper determined that Oregon employs at least 220 public affairs specialists, design shop employees, and communications and public relations managers. The cost of their combined biennial salaries and benefits approach $40 million.


For instance, the Department of Human Services (DHS) was divided into two agencies in a cost reducing effort in 2009. At that time the agency had 16 advertising and communications employees. Two years later the two smaller agencies, DHS and the Oregon Health Authority, have more than doubled their communications staff to 39 employees.

Moreover, Oregonís top nine state agencies are scheduled to pay outside consultants about another $40 million during this biennium for public outreach and advertising campaigns. For example, the Department of Transportation employs 22 people devoted to communications. Yet the agency claims to not have the expertise or industry contacts to perform its advertizing and communication needs. It routinely pays outside consultants well more than $100 per hour for outside creative direction, media purchases and copywriting. A single five year traffic safety advertising campaign will cost the agency $5 million.

It seems that we may be paying both state employees and private company staff tens of millions of dollars to perform essentially the same tasks. Further, where is the wisdom in advertizing for greater public participation in programs that current budget constraints prevent maintaining at current service levels?

Oregon agencies produce and publish myriad magazines, pamphlets, brochures, catalogs and other outreach periodicals. These publications are usually printed on the highest quality paper with magnificent multicolor graphic design and extensive photography. The purpose for many of these periodicals is often not clear. We do not know who or how many people actually read the material. We often do not know what the agencies are trying to accomplish through their publications or whether they are achieving that purpose. Moreover, we often do not know the cost of developing, publishing and distributing this material. We do know that the cost is significant and amounts to tens of million dollars.


The Oregonian report did not focus on the additional substantial cost of state sponsored radio and televisions advertising. Hardly an hour passes when we are not exposed to some form of media advertisement promoting some government program, service or social position. Media advertising is expensive. The prime time hours when we often hear and see these advertisements are very costly.

Most egregious, the Department of Administrative Services that is charged with the responsibility of accounting for government costs admits that it has no current means of accurately accounting for or quantifying the costs of state government advertising and outreach.

The Oregonian used multiple public records requests and their own investigative skills to estimate those costs in nine state agencies. Oregon has more than 60 state agencies, boards and commissions that all have some advertizing, outreach and communications roles.

The fact of the matter is that we have no idea how much the state actually spends on these activities. Further, we have no current means of measuring the benefits derived from those expenditures.

Our Ways and Means General Government Subcommittee is working with the Department of Administrative Services in a concerted bipartisan effort to find the answers.

Please remember, if we do not stand up for rural Oregon no one will.

Best Regards,

Doug

 
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              Page Updated: Saturday January 14, 2012 03:05 AM  Pacific


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