PORTLAND, Ore. (KOIN) – At the end of January, Oregon Governor Tina Kotek unveiled her budget proposal for the next two years with priorities like addressing housing and homelessness, funding mental health services and education — featuring a $116 billion price tag.

The new governor says she will not impose any new taxes to funnel money toward these issues.

With a new state budget, Oregonians typically see more money going into the reserve fund, essentially the state’s savings account. However, Kotek says she will not add to the fund in order to tackle the crises facing Oregon.

Instead, the governor wants to redirect $766 million that would have automatically gone to the reserve fund, to target her priorities.


Gov. Kotek is proposing a $1 billion budget to build and preserve affordable housing. The budget recommends $770 million for new affordable housing, $118 million to preserve current affordable housing and $4 million for manufactured housing.

Additionally, she wants $2.2 million to start the Housing Production and Accountability Office.

The governor is also factoring in her State of Emergency Declaration on the housing and homeless crises that she made on her first day in office when she signed three executive orders.

“I called on the legislature to invest $130 million as soon as possible in order to meet my goal of reducing unsheltered homelessness over the course of this calendar year,” Kotek said during a press conference detailing her budget proposal.

She added, “this budget expands on those early investments to rehouse and maintain housing stability for households moving from unsheltered homelessness into stable housing, provide ongoing homelessness prevention support, maintain shelter operations, create new permanent supportive housing and more.”

After she unveiled her budget, new Oregon House Speaker Dan Rayfield told KOIN 6 News “our opportunity to pair up with some of the governor’s tasks along with some of our early investments makes an incredible amount of sense.” He added that “we’re going through the process of evaluating the governor’s package with those groups of legislators to determine OK, what can we move right now?” 

On the Senate side, Senate President Rob Wagner previously told KOIN 6 News they are “ready to answer” Governor Kotek’s call after she signed three executive orders to address housing and homelessness.

In terms of the lack of affordable housing in Oregon, Rayfield says lawmakers will focus conversation on supply — adding that the state is underbuilt by more than 100,000 homes.

“The nice thing about this session — and I spent a lot of time during the campaigns reading campaign literature from Republicans, from Democrats — and everybody is focused on those same topics. So, that is this opportunity where we have unanimity where we need to focus,” Rayfield said. “This is a problem that is of the size where it’s going to take collaboration between all levels of government.”

Mental health and addiction care

In Kotek’s proposal, she’s asking for nearly $279 million to go to addiction treatment, overdose prevention and peer support services. This would be funded, in part, by Measure 110, which decriminalized most street drugs and directed money to addiction programs.

Kotek also wants to put $50 million towards increasing staffing at the Oregon State Hospital with another $195 million towards continuing behavioral health center investments.

In 2021, the state legislature approved $1 billion for behavioral health services, and Kotek says some of that funding needs to be better distributed.

“We have more to do to build on what is working and create a connected system that can lead to hope, healing and recovery. That’s why I’m proposing investments to disrupt the harmful and expensive pipeline of Oregonians moving from homelessness to jail or the state hospital,” Kotek said.

She continued to say her budget “aims to do this by increasing local residential treatment options, improving jail diversion services and enhancing intervention and outreach before patients are civilly committed.”

The governor said she’s also looking to invest in the workforce for these sectors.

“This work can’t be done if we don’t support our essential behavioral health workers and work to build a diverse and culturally responsive workforce. We must increase wages for community health providers,” she said. “My budget proposes doubling the Oregon Health Authority’s health care provider and center program which would bring up to 1,000 new workers from diverse backgrounds into this pipeline by supporting loan repayment, scholarships and other support for licensed behavior health providers and students.”

Education and childcare

Oregon has had some of the worst graduation rates in the nation. Although rates are improving, the governor wants to raise the state school fund from $9.3 billion to $9.9 billion. The biggest chunk of that investment includes a $100 million investment for increasing literacy at preschools and elementary schools.

Speaking to her education budget proposal, Kotek said, “these investments can only make the desired impact for our children and students with focused leadership and increased accountability. All of our education investments must be put together with specific, proven strategies to ensure we know that how the dollars are being spent are connected to the education priorities that Oregonians care about and that outcomes are achieved for every child who deserves them.”