Oregon Governor Kate Brown announces details of her 2017-19 budget proposal during a press conference at the state capitol.

Oregon Governor Kate Brown announces details of her 2017-19 budget proposal during a press conference at the state capitol.

Chris Lehman/OPB

Oregon Gov. Kate Brown rolled out a two-year spending plan Thursday at the state Capitol. The proposal tackles a $1.7 billion budget shortfall with a mix of program cuts and tax hikes.

The governor’s budget includes what she calls “painful cuts” to state services. Those are cuts that likely would have been avoided if voters had approved Measure 97, the corporate tax hike on last month’s ballot.

Brown’s proposal does include some tax increases: a higher tobacco tax, a tax on hospitals, and getting rid of a tax break for some kinds of businesses.

But all told, those tax hikes would raise less than one-sixth of what Measure 97 would have.

Brown, a Democrat, said she’s still talking with business and labor groups about how to raise more revenue. She notes that those discussions are part of a decades-long attempt at crafting a more stable source of revenue for the state.

“Oregon governors and legislative leadership have struggled to find the right solution,” Brown said. “I am hoping that over the next several months — possibly years — that we can find that right solution.”

The governor’s spending proposal is a starting point for what will be a months-long budget crafting process involving state lawmakers.

Some of those lawmakers weighed in on the governor’s budget plan Thursday.

Senate President Peter Courtney, a Democrat, said Brown’s proposal “will definitely prompt debate, and it should.” He said the Legislature’s budget-writing committee will seek public input on a statewide series of public hearings.

“It has never been more important for Oregonians to decide which priorities we value most and just how much we value them,” Courtney said.

Republicans, who hold the minority in both legislative chambers, blamed the cuts in the proposed budget on “overspending” by Democrats.

In a statement, House GOP leader Mike McLane said:

“Until we are willing to … address the root of our budget problems, we will continue to experience the same kind of budget challenges we are facing today.”