A conversation with Oregon Gov. Tina Kotek

Since our last conversation with Oregon Gov. Tina Kotek, President Trump has enacted tariffs and mass layoffs that could significantly impact Oregon’s federal workforce and economy. The Oregon Legislature has also begun its biennial session, taking up issues around education, transportation and housing. Kotek joins us in the studio to talk about all of that and more.

Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.

Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. Oregon Governor Tina Kotek is our guest for the hour today. And as always, there is a lot to talk about, from housing, education and transportation to the legislature’s first two months or so of its five-month session. That is all in addition to the effects of the Trump administration’s efforts to massively reduce the federal workforce and federal spending.

Tina Kotek, it’s good to see you. Welcome back to the show.

Gov. Tina Kotek: It is so nice to see you, Dave. Thank you for letting me come into your studio.

Miller: I want to start with housing, one of your top priorities. In November, Oregon released its first ever State of the State’s Housing Report and there was a lot of bad news in it. It found that we have, by far, the highest rate in the nation of unsheltered homelessness among families with children. We are short nearly 130,000 affordable housing units for people who are considered extremely low income or very low income. Evictions are going up. They recently hit their highest rate in 12 years. And many of the fastest growing occupations in the state don’t pay high enough wages for people to be able to afford a one-bedroom apartment. There’s more, but I had to stop my list at some point.

Did the release of this report, the first of its kind, change your mind about any of the policies that you have already been pursuing or want to pursue?

Kotek: No. And in fact, I think it was a good, sobering wake up call. When you can see those kinds of numbers, then you know we’re in crisis mode, we have to be doing everything we can be doing.

Miller: But you already knew that?

Kotek: True, but you’d be surprised. Everyone lives busy lives. Until you put those kinds of stark numbers in front of folks, they don’t sometimes get it. From my perspective, we are putting everything we can in the kitchen sink at this problem. What you see in that report is everywhere from how our homeless service system is working, up to what we need to do for the final outcome, which is get people into housing … which means more supply.

Miller: I want to play part of an exchange that we had the last time we spoke in your office. This is from our interview in August of 2024.

[Recording playing from OPB’s 2024 interview with Gov. Tina Kotek]

Kotek [recording]: Here’s what I’m going to be looking for next year, in particular. Are our housing start numbers up? [Are] all of the projects that the legislature funded around infrastructure, shovel ready projects, on course to be finished? That’s why after the session was over, I reviewed and our team reviewed all of those individual allocations. It’s like, what is the timeline? Some of them were this year, some of them were next year, some of them were 2026. We are trying to put all that in one spot so we can track it better. But I want to see more new housing starts next year.

Miller [recording]: So in 2025, what happens if there aren’t more housing starts?

Kotek [recording]: We’re gonna reassess and keep going. And I’m going to ask people, OK, we’ve given a set of tools. We’re clearly not being aggressive enough. I think we’ve put a right mix of opportunities, options, tools for developers, both for-profit and nonprofit, for them to improve our housing starts. If it’s not doing it, then we’re gonna come back and say this isn’t working, we need more.

[Recording ends]

Miller: Looking at the latest numbers I could find data for, it seems like it’s not working. There were 18,000 housing starts in 2023 and barely more than 13,000 by November of 2024. That’s the latest I could find data for … meaning that, unless there was an enormous increase in permits being pulled for new residential construction in the last month of last year, we’re significantly down just one year to the next, at a time when your administration has been really pushing to do the opposite. And you had said, if I look and housing starts are not up, then it’s gonna mean we’re not quite on the right track. We’re gonna have to do more. So it seems like we are there now. What more do you plan to do?

Kotek: I will be interested in seeing … Well, first of all, thank you for going to those specific questions. We have to look at the housing starts for this year. We’re not quite in construction season. I do think there is a bit of a cycle to things that are getting funded to be constructed. So I don’t think we have all the numbers to be able to make an assessment, at the moment.

That being said, just a couple of weeks ago, I convened a work group with the mayor of Portland to talk about multi-family housing. And we have to build all kinds of housing in Portland. Portland is significantly behind where they need to be. Our largest city has to improve their numbers. And what I heard from folks who have their permits and just need their final bit of financing is that interest rates are really challenging, lending has been challenging, how people feel about, frankly, Portland as a place to invest is a little shaky.

So what I took away from that was that we need to keep cutting the red tape, do the streamlining, get some dollars out there to help people get in the pipeline. But for people who are ready, my job right now is to convince investors that Portland is a good place to invest because I think we are making progress. So Portland’s a microcosm of the challenge.

Miller: How do you do that? Because, in a sense, you said part of your job now as the chief executive of the state is to tell people who build market rate housing, the private sector, “Please, it’s a good time to build in Portland, a good time to build in Oregon.” What is your pitch?

Kotek: We will continue to grow. Some of our in-migration has slowed, but we are still seeing in-migration. So we are a good bet for the future. This year, I think, is critical. So when the mayor and I talked about this, it is continuing to do what we’re doing in terms of improving the livability and community safety. And we are seeing better numbers there.

Telling the story nationally that Portland’s a good investment … I’ve even thought about [doing] a tour with investors. Let’s come down, walk the streets and talk about what’s happening. It is a little bit about doing a better sales job to say Portland really is a good investment, because I do believe it is. I think we will continue to grow, and people are going to continue to move here and they’re going to need housing.

I bring that example up to point out that there are so many factors in getting housing built. And I learn, frankly, a new one every couple of months. The bills we have in the legislative session that I’ve been working on, you’ve probably heard about the middle housing bill – we’re trying to make it easier, more predictable to build different types of housing options in communities. That’s something we’ve worked on. This is kind of 2.0 iteration of that.

We’re talking about streamlining certain types of regulations that cities can just plug and play. You’ve met this criteria, you can go to build, making the permitting easier. We now have a revolving loan fund for people who are trying to build market rate or workforce housing, to get a no-cost loan to get in the pipeline.

So I wish things were going faster and I feel good about the tools we’ve put in place. But frankly, nationally, everyone is struggling to build. I don’t think we’re any different. We’re just in a different hole compared to other places.

Miller: I want to turn to the permitting question. Given that we are in a housing emergency, would you support a legislative effort to take that kind of regulatory control away from cities and to say, “like you did for zoning, we’re going to implement some kind of statewide pro-growth, pro-density policy,” and we’re going to take that power away from cities to make it so we can truly fast track housing production everywhere, in Portland, in Roseburg, everywhere?

Kotek: I think what we need to do is provide very accessible templates for our local governments to, frankly, get out of the way and make their life easier. Here are zoning approvals and things that you can just say, “yep, that meets it, let’s go.” I think it’s very difficult for local governments to move faster because they’re not as resourced to do that. So let the state help you go faster ...

Miller: Do you think that they would take you up on that … like a voluntary template, we have an idea for a fast track way to approve construction for a single family home or a duplex? You’re saying that some cities have already used state provided versions of those rules?

Kotek: Well, I was just in Bend in January for a Western Governors Association meeting. It’s a region-wide conversation about housing and housing construction. Bend is taking advantage of every tool the state has given local governments to facilitate their construction. It’s very impressive. And there are a few other places I think that have done a really good job. Albany has been impressive. I think Eugene is trying.

So what I would say is, I need more cities to take advantage of that. And some of that is just getting through this idea that we have to control every piece of construction when we’re in a crisis. And we’re getting there. I see more cities saying, “Just make it easier for us. We want to build more things.” So we’re getting there. It’s just regulating and mandating from the state.

Miller: And when we get to education, that’s a place where you have been moving more towards a version of Salem control for schools that, let’s say in the future, are going to be underperforming four years in a row. We’ll talk about that in a second. But I’m curious why you would say, yes, given the education emergency, I am ready to back a bill, to put forward a bill that would exert more Salem control over education, but you’re resisting that for another emergency, which is housing?

Kotek: Here’s the approach I’ve taken on all of these issues. I think sometimes it’s easier to say, “Let’s just blow it all up. Let’s go from scratch and start all over.” You might say that’s how the Trump administration is taking on the federal government ....

Miller: Right, let’s break it all and see if we miss anything that’s broken?

Kotek: That’s right. Let’s break it. Let’s have chaos. I don’t think that’s the right way to go. What you’re seeing from me is a much more defined outcome-based, I would say, robust relationship and partnership with our local governments. So when I came up with the homelessness emergency, I said we all have to be doing this differently. I want to get you money, but here’s my criteria. You get to fix it locally for you too, but we have to hit these goals. I need you to rehouse. I need you to build shelter beds. I need you to keep people from becoming homeless in the first place.

So we have a structure and then there was some local variation. You’re going to see the same thing with the way I’m approaching school accountability. We need folks to move. We need to set expectations. The state will come in and provide assistance, and if necessary, a little bit of a hammer to move people faster, as opposed to just blowing the whole thing up and saying none of it works. That takes time. It doesn’t solve any problem. What we’re seeing with my homelessness emergency is local communities have stepped up. We’re staying committed to supporting them and they are hitting their goals.

Miller: So let’s turn to this education piece. One of the big themes or questions I’ve asked you, I think, a number of times is what would it take for you to exert more control to say [that] the Oregon Department of Education (ODE) is going to demand more. It’s going to have some version of accountability for the increased dollars that schools got in recent years. The Speaker of the House, Julie Fahey, said this recently: “Over the last few years, Oregon has made significant investments in our K-12 education system. But our student outcomes remain among the lowest in the state.” That led her and you to release this bill that would give more control to the ODE. How would it work?

Kotek: So we have good bipartisan, bicameral support for my accountability package. So what it says is, “Let’s set the metrics we’re gonna study, track and hold people accountable to.” So these aren’t all new things. We passed the Student Success Act in 2019, where we said to districts, “you need to have a community plan for that new money that says you need to have better attendance numbers, you need to have 3rd grade reading, graduation and five-year completion.” There are five metrics there. I’m adding a couple more: 8th grade math and kindergarten attendance.

I’m saying these are the things you are going to be evaluated on. And if you’re not hitting those goals, we’re going to provide required support, mentoring, technical assistance, whatever you want to call it, with the district. And by year four, if you are not making progress, we will have to have a conversation, and come in and say, “up to 25% of the money you get from the state needs to be directed in a way to improve your outcomes.” The goal is never to get to that. But I think we’ve been very vague or a little wishy-washy about what we expect from our districts.

I am fighting for every dollar I can get into our schools. I know people say we just need more money. We are middle of the pack in terms of how we fund our schools, compared to other states. But we’re at the bottom, and that’s what the speaker was saying. We’re at the bottom when it comes to our outcomes. That doesn’t work for me. I’ll get you more money, but I need better outcomes. It’s not a blank check.

Miller: How do you explain the fact that school administrators seem supportive of this? The cynical view of this … Let me give you a possible reason. You can tell me if you think I’m right or not. In general, local entities like to control their own destinies. They like to control their own purse strings. This has certainly been the way education has worked in the state for a very long time. The fact that schools in general don’t seem to be fighting this makes me think either they don’t think that they’re gonna end up in arrears four years in a row, or, if they don’t meet these benchmarks and they have to lose some control, that there will be some way in the rulemaking that it won’t be as draconian as it seems.

So those are my maybe cynical interpretations of this. But I’m curious why you think districts don’t seem to be screaming about this?

Kotek: Well, I did see the press conference from Portland Public Schools who said, “Give us more money.”

Miller: But that’s a separate question. School districts will always say that schools are not being funded as much as experts say they should. That, to me, is a separate question. They said, “If you’re going to do this, give us more money.” But they didn’t say, “Don’t do this.”

Kotek: That is correct. I have been approaching this in the spirit of partnership, just the way we did when we reset how we calculate the base funding for our schools, which was the basis of my budget. It is a very strong state school fund number for districts. It’s still challenging for some places, but it is a really good number to say we want to make sure you get your basic needs met in the district for your students. I’m fighting for more money for early literacy and for summer. Those are direct funding that we know will help our students be successful. So they know I’m trying to get them more resources.

In the conversations leading up to the legislation, we heard from folks, “Give us a reasonable path. Tell us what you’re measuring. Help us to do more interim assessments, so we’re not just basing it on a one-time test that happens and we don’t see the results till after the school year is over.” I heard all that, put it on my bill. There’s still nervousness, even though people are out there saying they generally agree with the approach. But there’s nervousness about it. We’ll have to work on the details of when those particular mandated tools go into effect for the districts.

But here’s what we know: Oregonians love their schools. They believe in accountability. They believe in some level of local decision making and they want the state to be able to say that we, as state government, are doing everything we can to get better outcomes for their kids ...

Miller: What makes you say that Oregonians love their schools?

Kotek: Well, there was some really great polling from Foundations for a Better Oregon. They did some work last year to look at the Student Success Act, which was passed in 2019. Remember, that was a billion dollars more per year for our school districts. And then the pandemic hit. So it’s been a little bit taken off track. But when they did some polling, in talking to folks, people really understood that we have schools that they like and they want to see better outcomes. And you can hold both things to be true. Sometimes people think their school is fine, but then they know students aren’t doing well in other places. I have to see the whole picture. It’s not OK that kids can’t read by 3rd grade. It’s just not OK.

Miller: A few weeks ago, ODOT officials went before lawmakers to explain how they had overestimated their federal funding by more than a billion dollars when they were crafting their last budget. That led to delays in planned road and bridge projects, plus nearly $500 million in new debt, according to an audit. Do you trust this agency right now to be good stewards of Oregonians' money?

Kotek: We started this conversation last year, knowing that we would be having a transportation funding conversation in this legislative session. I asked for an external review of their processes and the Oregon Transportation Commission just received that report, I think, in the last week or something like that. So we’re looking at why they couldn’t do the forecasting and the estimating right. That is a problem. So there’s been a lot of work in the last nine to 12 months internally at the Department of Transportation where I have said, with the director, “You’ve gotta do your business better so people have confidence in the dollars you’re going to receive.” I do think we’re on the mend. I think that they’re putting the right things in place.

I also met with Senator Bruce Tarr, who’s been tapped by the Senate president to come up with a set of accountability measures. I welcome that. Let’s put some other things on top. So when the legislature does pass a transportation package, we have more certainty about what will be accomplished. I have a lot of alignment with our legislative leaders that we have to focus on the basics. This isn’t about a lot of big new projects. This is about, can we pave our roads, can we provide winter maintenance and make sure our bridges are safe? That’s where I’d like to get back to. And I am helping to create an agency that will be more accountable.

Miller: But why should Oregonians have faith in it? You’re saying you’ve been focused on this, and you’ve been having conversations with the leader and calling for a report, but what specific changes make you say that, yes, now we can trust them with even more money?

Kotek: I do think, even in the last year, they have started to tighten up their forecasting techniques of planning for what we need in the projects that we’re going to build. Frankly, in 2017, when the transportation package was passed – I was in the legislature at the time – we put some things in place that we thought would work. They haven’t worked, so let’s look at them, reassess. I’m very honest with Oregonians. If it’s not working, let’s keep working on it. Nothing’s ever perfect. And I think what I’m seeing in ODOT is an understanding that they need to be better, that the legislature is going to put additional guidelines for them to maintain that level of accountability. And we got to get a package done.

Miller: What funding mechanism would you most like to see for transportation projects, given that gas taxes have not kept up with inflation and fuel efficiency is playing into that?

Kotek: I think this is the next iteration of how we fund transportation in this session. I fully expect we will see the beginning of some kind of global road user assessment that some Oregonians are already using ....

Miller: Voluntarily?

Kotek: Voluntarily. Because at some point, we’ll have more people who will need the roads but will not be carbon-fueled vehicles. But that’s going to take a while. I don’t think people should understand that you turn on a road user fee on day one, that you have all the money. This is a 10- to 15-year development, to get to a new funding source for transportation.

Miller: So in the meantime, can we expect higher gas taxes and then some other user fees at the DMV that make up the difference as you get to a non-gas based way to pay for roads?

Kotek: I am looking to the legislature to fund a package that will make sure we can meet our basic needs in the state. I would suspect that it will be from the menu of things that we have previously funded transportation packages by – modest increases in registration fees and title fees, maybe a little bit on the gas tax, there have to be some increases there. The question is what the right amount is. I’m very cognizant of the fact that people are struggling with the cost of living. So we have to be careful about how that package is put together. But I also think a lot of folks believe that when you use a resource, when you use the roads and bridges of the state, when you pay into it, that’s kind of the obligation you have as well.

Miller: A week before Christmas, you put out an executive order mandating that state agencies use project labor agreements for most major infrastructure projects. There are some carve outs and agencies can ask your office for specific ones, on a case by case basis. But basically, this means that agencies have to enter into agreements with unions before work can begin, if labor is going to make up, I think, 15% of the total project cost – I think that’s the line. It’s gotten a lot of pushback, as you know, from contractors, from business groups, from Republican lawmakers. It’s the subject of a lawsuit now. Why did you sign this order?

Kotek: I think when the workers who do the job for major construction projects that we, as a state, own, when they sit down with the companies who do the construction and can come to an agreement on how best to compensate workers, what the working conditions are, they will do a better job. They are more likely to get to a project that is on time and on budget. And when you are building large scale projects with public dollars, I believe that there should be mutual benefit in the community. What project labor agreements do is all that. They say, sit down, figure this out. What does it mean for the workers who are going to do this job? And I think you’re going to see some benefits for the communities that you have not seen, like apprenticeship requirements and purchasing locally. All these things come with having a conversation instead of just saying, “OK, you’re the big contractor, you get to make all the decisions.”

I think, and research has shown, project labor agreements can be cost effective and beneficial to communities. At the end of the day, this is a little bit of a philosophical difference about [whether] project labor agreements work or not. I tend to believe that they are good for communities, good for projects and good for the bottom line of the state.

Miller: As you know, though, ODOT studied this two years ago, looking at studies of more than a thousand project labor agreements around the country and their report had this line: “The analysis found the inclusion of a PLA was strongly correlated with increased construction costs within the range of 10% to 20%.”

The sense I’ve gotten from looking at reporting about this is you can find studies showing that PLAs did not add to a project’s cost. But there are plenty that show that it did add something to a project’s cost. This is at a time when we’ve just finished talking about the urgent need to very carefully steward public money to pay for roads but other things as well, housing as well. I think that affordable housing projects would be exempted from that, I should point that out. But there are a lot of projects that Oregonians will be paying for with their money in the coming years that might be affected by this.

Do you just disagree with these studies showing that a lot of PLAs seem to have increased overall project costs?

Kotek: Well, I will be upfront. I have not seen all the numbers that you’re referring to. That being said, some of the things that don’t get covered when we talk about overall costs are the price at which the contract is signed or what the final cost of the project is. We see massive cost overruns sometimes. We see adjustments after things have been bid, and what I think project labor agreements do is you get more consistency and efficiency because of the skilled labor and the agreements that are made on the upfront. So if there are problems on the work site, they get resolved a lot faster.

So again, I think we have differing research on this. I believe, at the end of the day, this will be good for communities, good for the projects themselves, and it’s a way of us stewarding public dollars in a way that we haven’t been doing. There’s been a lot of inconsistency in this area and my executive order is to provide guidelines. We do have some exemptions because for some projects, if they’re very simple projects, it might not make a lot of sense. But when you have a very high cost, complex project, a project labor agreement is going to be helpful.

Miller: I want to turn to the overall state economy. Carl Riccadonna, the still pretty new state economist, reported recently that while Oregon has seen job increases in healthcare, education and a few other sectors, it’s lost workers in areas like manufacturing, finance and retail. What stands out to you in this data?

Kotek: Well, I’m glad Carl is on board. I think he’s giving us a very strong macro understanding of the economy right now. I think we are stable. I think there are warning signs on the horizon around manufacturing that we need to pay attention to. What worries me about the economics of the country and of Oregon right now is, frankly, what’s happening at the national level. The idea of having blanket tariffs could impact a place like Oregon. We’re a very trade dependent state. I mean, we sell soft wheat to Asia. I just met with some folks from Ferrero [Italy] who make Nutella and they want to buy our hazelnuts. Tariffs will impact us a lot. We’ve seen some downturn in the semiconductor industry, which is a big sector for us.

Miller: By far, the biggest Oregon import and export is computer parts and semiconductors.

Kotek: Yes. So I think we have to stay bullish on supporting the industries we have here, doing everything we can to protect them. Obviously, the Oregon CHIPS Act has been successful in building the semiconductor ecosystem. That’s in addition to Intel, so we’re still focused on that.

So my concerns about the rumblings we’re hearing at the national level about a potential recession is frankly the uncertainty and instability that the Trump administration is causing. It affects a state like us significantly because we are very trade dependent.

Miller: I want to put a pin in big questions about the federal government for a second so we can just focus a little bit more first on some Oregon specific things, and then I’ll definitely carve out time for that.

In 2020, Oregon missed its statutory greenhouse gas emissions reduction goal. And that goal is less ambitious than the one in the executive order put out by your predecessor, Kate Brown … meaning that, right now, it does not seem like we are on track to meet our targets. What do you think is not working?

Kotek: What’s not working at the moment is the federal administration not making sure our Inflation Reduction Act awards and our Pollution Reduction Grant awards coming from EPA are coming through. I want to be really upfront ...

Miller: But the numbers I just mentioned precede what you’ve just described. What you’ve described is real and we should talk about it. But I don’t want to let you get off easily by simply saying this is because of what’s happening with the federal government. Those numbers precede Trump’s inauguration.

Kotek: True, I think for us to jumpstart into that next level of reaching our goals, it was somewhat dependent on knowing that we would get some additional federal investment. So I just want to put that out there. In terms of the programs that we’re doing here in Oregon, they’re working. We have more people than before who are buying electric vehicles. We’re on the path to improve more infrastructure. We have had a very successful heat pump program where we’re getting higher efficiency heat pumps into people’s homes.

All of the things that as a state we should be doing, we have been successfully implementing. Now, it gets more challenging where you’ve [picked] low hanging fruit, so how do you get to the next level? How do we get more renewable energy cited, permitted and online? We need much more renewable energy into our grid, for example. We knew these were going to be challenges and it is really hard when we don’t have a federal government that’s really walking side by side with us.

Miller: Let’s turn to that, because it’s a little bit of an artificial line to say let’s only talk about the state, if we are unbelievably tied together and dependent on the federal government. So you mentioned the Inflation Reduction Act. Some money, some projects have already gone through. This has been a couple of years already. But you’re saying that there is money that had been allotted to Oregon, that agencies were expecting, that is either on hold or fully off the table. Where does that stand right now?

Kotek: Yeah, so the Trump administration completely suspended new dollars coming into the state from the Climate Pollution Protection Program. I’m trying to get the right acronym here [CPRG: Climate Pollution Reduction Grants]. It’s the EPA program that said we were going to get about $198 million into Oregon for these signature programs that would also do things like reducing methane in our landfills, getting more people into zero emission vehicles, more heat pumps – just a slew of things that we were like, “just give us more money and we can expand.” We signed. We had awards and those things have been suspended … so much so that those projects that thought they would be getting these [grants] have had to stop what they’re doing.

There’s a housing project in Tillamook you probably read about. You might have covered it here at OPB. They were counting on some money to be the money that would get them to final construction, because they had some energy efficient elements to their construction. Now, they don’t know if they can get to the building right away. There are real world impacts when the federal government says, “Hey, you know that money thought you were going to get? You’re not going to get it.” People have been planning for it and that is all at the feet of the Trump administration.

Miller: What are you doing in response?

Kotek: Well, we are definitely pushing from a legal perspective, with the attorney general, and other attorneys general and governors around the country, saying, “That money needs to flow. You can’t hold that up. Actually, Congress would have to change their mind before you can do that.” So we’re pushing on the legal angle.

And I’m going to continue to push Oregon and Oregon agencies, based on the money we have, to continue to maximize our resources to hit our mission goals. I was saying the other day, we’re going to keep trying to hit our climate goals regardless of what the federal government does. And I’m just going to be honest. It will be more challenging to do so unless those resources come back to the state.

Miller: What are you expecting in terms of Medicaid, a source of an enormous amount of federal support, in this case, for children, for poor Oregonians, for people with disabilities, for older Americans getting long-term care, just literally millions of Oregonians. And we’re talking about hundreds of millions of dollars at stake. What are you expecting right now?

Kotek: So for those who might not recognize, the Oregon Health Plan is Oregon’s Medicaid program. One of every two kids in the state receives their health insurance coverage by the Oregon Health Plan, which is our Medicaid program. This is a conversation that we saw in the first Trump administration, that people think Medicaid is too expensive and they should cut it back. We have shown in Oregon that we know how to hold costs down in our Medicaid program and actually help people get healthier and have access to care. What you are seeing in D.C. right now is a return to a very partisan attempt to restrict Medicaid and put it all back on the states. This is a federal partnership.

States put a lot of money into their Medicaid program, as we do in Oregon. It’s a match. It’s a partnership with the federal government. I have not heard one idea out of D.C. that explains why Medicaid should be cut the way they’re talking about. And the only reason they’re talking about cutting Medicaid is they need to fund a bunch of tax cuts that they want to extend for really, really wealthy people. That seems like that’s a problem. So no cuts to Medicaid. That is not a fair thing and Oregonians will be hurt. Our seniors who are in long-term care will be hurt. We will have to reduce care in all kinds of ways if the money coming is cut off from the federal government.

Miller: Let’s dig into this because, I mean, the details here are important. Let’s say that there were a sizable decrease in federal spending to states for Medicaid. To what extent could Oregon pick up that slack?

Kotek: Almost impossible. I’m just going to be really frank. I don’t know where that money would come from to make up for what the federal government contributes to Medicaid in Oregon. One of the things they’re talking about is just giving us a flat amount of money and saying, “Go manage that.” Right now, as more people are on the program, the feds put in more money. We put in more money. It increases over time. They want to just flat cut off that kind of growth potential. So there’s only a couple of ways you can manage for that. You either kick people off the program, which I would not want to do, or you reduce the benefit [resulting in] the same problem.

When we reduced the Oregon Health Plan, the legislature did, back in the Great Recession …

Miller: Just to be clear, the third choice which we heard from your predecessor, two governors ago, John Kitzhaber, who was on last week, is you reduce the cost of services?

Kotek: But we’re doing that here. I think Governor Kitzhaber is making a good point. If other states did what Oregon is doing now, through the waivers we received from the federal government to manage our costs at a 3.4% increase over every year – we manage in a way that is based on good outcomes, not just paying for things – we’d save a lot of money nationally. But we’re already doing that in Oregon.

And here’s what I’ve seen in D.C. in my couple of conversations … There’s not a lot of nuance right now. No one is sitting there actually wanting to have a conversation about reforming Medicaid. They just want to cut money so they can pay for something else. I appreciate Governor Kitzhaber. But we’re doing it here in Oregon. So how does that help us? They want to cut Medicaid at the federal government [level] and they kind of don’t care what happens at the states.

Miller: There was a recent internal review of healthcare in Oregon’s prisons showing that people in custody were routinely denied care. The Department of Corrections fired its two healthcare leaders as a result. Then just last week, you fired longtime director of the Oregon Youth Authority, Joe O’Leary. That was after a growing number of abuse claims surfaced. These are both agencies that essentially incarcerate Oregonians – adults, in the case of the Department of Corrections; and children, in the case of the Oregon Youth Authority. What do you see as the connections between these two cases?

Kotek: I do think they’re different challenges. But the bottom line for me is, it is our responsibility as a state to run and maintain safe correctional facilities that meet the needs of the folks who are there, whether they’re adults or youth. In the adult system, Director Reese has been on the job about a year now, a brand new director, who has been identifying challenges that need to be fixed in the agency. One of those is the healthcare system. We’ve known that for a while. So he’s been making personnel changes, we’re having a new evaluation come in, we’re actually meeting with adults in custody and asking them what they need. So there’s a wholesale change happening in the adult correctional system.

In the Oregon Youth Authority, it’s very concerning to me that the office at the Oregon Youth Authority charged with taking complaints, investigating complaints and making sure youth in the facilities were safe, didn’t do their job. They were thousands of cases behind. And I can’t say if I know the impact of that because we don’t even know what the complaints are. That is frankly malfeasance. We need to be fixing that. So there’s new leadership now on the way.

Miller: How do you decide? My guess is that any given day as governor, you might hear the beginnings of the executive summary of a report, or you might hear rumblings that some agency subdirector has been looked into for X, Y or Z. These are two relatively high profile cases that turned into firings. My guess is some number of weeks or months after, people in your office were already talking about them. How do you decide now is the time to fire somebody and also now is the time to tell the public about what’s happening?

Kotek: Well, I always try to move as quickly as we possibly can. You want to have all the information straight before you make a decision. There was an investigation underway at both the Department of Corrections and the Oregon Youth Authority that needed to run their courses. As soon as I had enough information and as soon as the director, in the case of Director Reese, had enough information, action was taken. Again, a little bit of contrast to what’s happening at the federal level, where it’s like, “Let’s just blow it up and then fix it later.”

We still have to provide services. Firing people or reforming systems has to be done in a way that you can continue to do the business at hand and make improvements. From my standpoint, I will always ask hard questions. I am never satisfied. The minute I hear there’s a problem, I need to know right away what the challenges are. And then we have to have a plan to fix it. Unfortunately, I inherited some problems and I’m trying to fix them.

Miller: Let’s turn to another issue here. Last month, you had the state restart its Motor Voter program. That’s the automatic voter registration system for people who interact with the DMV. You put it on hold in the fall after we all learned that some non-citizens had been automatically registered to vote. We’re talking about a relatively small number of people, but it was the first time there’d been a very obvious problem with this previously, I think, broadly well-regarded program. How much faith do you have in the current system now?

Kotek: So when the problems came to light, there was an immediate action plan internally, to look at the process by which bad data, more or less, was being entered into a system and then was getting transferred to the secretary of state saying these folks are eligible to vote. We did audits, we did reviews. I would not have suggested or recommended to the secretary of state that we continue unless I knew, with some certainty, that we have fixed the problems.

There are now regular protocols in place to verify the data. I will say we have to continue, I think, to put some more automated systems in place to make sure that that stays that way. But no, there hadn’t been any review of this. The legislature passed this years ago. Everyone thought everything was fine and then it was a real wake up call that implementation wasn’t quite what it needed to be. Human error does creep into systems. But now, I believe, and the secretary of state would agree with me, we’ve put protocols in place to have better verification of the data.

It was a wake up call … but that happens. As a governor, I’m year three [into my term], I am continually surprised that we continue to have these kinds of operational problems. I don’t know if it was the pandemic or whatever, but my job is to say, “That’s got to be fixed. We have to do this better.” It’s kind of the reason I ran for office. I think I’ve said this before. How you do the business of the government is important. You can’t just say you want to do something. You have to actually do it accurately and right.

Miller: One thing that came to mind as you were talking about that is this. If I understand what happened at the DMV correctly, this is, in some ways, a software issue where it was very easy to kind of move forward in a default setting way. And even if somebody didn’t give a U.S. Passport, the software was a piece of this. You could look at Cover Oregon, 10 years ago or so, but a very public and unbelievably costly version of a software issue. The same thing happened during the pandemic with the Employment Department. Why is Oregon bad at public sector software?

Kotek: Well, I don’t know if we’re worse in other states. We’ve had challenges, but I haven’t done a state by state comparison. We needed a new system in the Employment Department to issue unemployment insurance benefits ...

Miller: They were using a system from 30 years ago?

Kotek: It took 10 years to get there. I think a better question might be, “Why does it take us so long?”

Miller: OK, answer that question.

Kotek: I don’t know. That was before me. But what I will say is there’s a new system in place. It modernizes our system. It is not 100%. And what I hear is new systems take about 12 months to work out all the bugs. So we’re at about the 12-month mark with Frances in Employment. So I think it is allowing us to do things we would never have been able to do under the previous system.

I can’t speak to the software in the DMV, other than human error and software assumptions have to be assessed on a regular basis, because things do get out of sync and then problems do happen. I think in Oregon, we are actually doing a better job of setting up new systems and fixing them as we go. But I don’t think that’s unusual. You go from a legacy system to a more modern-based IT system, there’s going to be some kinks.

So I think my point to Oregonians is, if you have concerns and things aren’t working, let my office know and we will do everything we can to fix them.

Miller: You mentioned tariffs earlier. Is there anything that you can do at the state level to lessen the impact of these tariffs?

Kotek: I would say very little, other than to continue to support the sectors we have and diversify our sectors. But again, we are very trade dependent, so it is challenging.

Miller: I’m curious how you think about your overall approach to the president. There was an Oregonian article this morning, basically making the point that you have consciously not put yourself out there as a very vocal opponent of the president and his policies. You haven’t been supporting him or quiet about the way you think some of his actions are going to affect the state, but you haven’t gotten on a soapbox in the middle of Pioneer Courthouse Square and said, “Resist, resist, resist.” Or if you have, I’ve missed that.

Is that, in your mind, a pragmatic decision that governors or leaders anywhere in this country who really stand up, now suffer consequences and have to deal with some kind of retribution? Or is it, do you think, more temperamental, that this is the way you feel most comfortable leading?

Kotek: I am both a fighter for our state and pragmatic. If there’s a fight, I will stand up for our state. When it came to being worried about whether a drug that’s useful for folks who need to have an abortion … mifepristone is available, we have a supply. I didn’t wait for the federal government to make mifepristone illegal. I said we need a supply in the state.

Miller: But that’s a policy you can enact and say, “hey, folks at OHSU or whatever, make sure that you have stockpiles,” as opposed to putting out an angry press release with loaded language for saying why the president is ruining our lives. I haven’t seen you doing that as much. Some elected officials are spending more of their time doing stuff like that.

Kotek: I’m not an angry bird type. That being said, when things have gone wrong, we immediately had a press conference when they cut off all the financing portals, the systems that we use to put our reimbursement requests into the federal government. They shut them down. We had a press conference that day to say this is illegal, you need to stop that, these need to be turned back on.

When I was in D.C. and found out that wildfire mitigation grants were being cut, that the Bonneville Power Administration wasn’t going to have staffing, all these things, I wrote letters to the secretaries and I said, “I will call anybody and advocate for our state at all levels.” I’m not afraid of doing that and I’ve got to focus on what’s happening in Oregon. In some ways, our destiny is ours to create while we have a very uncertain federal environment. And it’s going to be a long four years. I long for the days of some consistency with a federal government that we had under previous administrations. So I have to focus on what matters for Oregon and tune out the noise at the moment because people are counting on me to make sure people have what they need here in the state.

Miller: What’s the latest that you’ve heard about layoffs, early retirements or defunding at the Bonneville Power Administration, at NOAA, at the National Weather Service, at the National Forest Service?

Kotek: They have all been, I think at the end of the day, detrimental for Oregon. So people were scared into taking early retirement. We saw a bunch of folks leave at Bonneville, Forest Service and other places. It’s going to impact our ability to meet the needs of Americans. The federal government won’t be there for everyone. When you’re a veteran showing up at the VA, you’re not going to have the same people you had before. I hope our electrical grid isn’t impacted by the fact that a bunch of people took early retirement at the BPA. When you take your vacation this summer to National Park, is there going to be a park ranger there?

There will be real personal impacts for things that Americans and Oregonians have counted on. I’m particularly concerned about the impact on rural Oregon. When you have people who have federal jobs in the natural resource agencies – Parks, BLM, Forest Service – those are good paying jobs. When they go away, that disproportionately impacts our rural communities. I don’t think the Trump administration cares and it will continue to impact our communities.

Miller: Is there talk among fellow Democratic governors about banding together to somehow provide replacements for some of the things that are being cut. I’m not talking about all of it. You’ve already said that there is no replacement for Medicaid funding. But I’m thinking about weather stations or a CO2 monitoring station in Hawaii. Is there talk between governors of Colorado, Washington, California, you, Hawaii to say, “you know what, we will band together and fill in some of these blanks that are left by a federal disinvestment”?

Kotek: I actually think it’s the opposite because governors understand what things cost. They understand what it means to sustain them. And I can’t think of a state government in this country that thinks that they can pick up the tab for what the federal government has been paying for, which they should be paying for because these are national resources. Think about it. They want to cut NOAA, the agency at the federal level that monitors the weather and tells us when there are storms coming and the tracking. They can’t even put up weather balloons they need because of budget cuts. That’s just insane. It is a national priority for us to understand what the weather is doing right now. So there’s no way any states, even banding together, could replace that.

Miller: Just over the last year, people who really pay attention to artificial intelligence say we are on the cusp of a societal transformation that boggles my mind. It’s hard for me just to wrap my head around, as a human. But they say it’s going to impact labor, security, education, healthcare, every aspect of our lives. Are you having questions, at the state level, about what AI is going to mean for Oregonians?

Kotek: We’re already seeing the impact of artificial intelligence. In fact, AI is used in a lot of services that I don’t think people have complete transparency on. I did have a council that just wrapped up their report on how artificial intelligence should be utilized across state government, set up some guidelines. There are ethical concerns, making sure that the assumptions that are in artificial intelligence will equitably treat Oregonians the way they need to see services happen.

Like any new technology, I think we should be cautious. I also think there’s a lot of potential for AI and tools that are AI-driven that can enhance the work we do at the state. I think it will reduce bureaucracy, while allowing state workers to be able to do different things with their time. And I particularly think of folks who work on the human service side. If an AI-funded, or AI-driven tool could help you do your eligibility calculation faster, for example, then you get more time to actually have face time and one-on-one conversations with the person you’re trying to help. We could make it more of a human interaction because AI takes the paperwork off your hands. So I want to make sure we capitalize on that because I think that could help.

Miller: Tina Kotek, thanks very much.

Kotek: Thank you, Dave.

Miller: Tina Kotek is the governor of Oregon.

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