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Kare Brown Governor Oregon's economic recovery is driving growth in our metro areas, leading to record revenue growth and triggering an unprecedented kicker refund of $1.4 billion. And for the first time since the Great Recession, the last few revenue forecasts have shown that Rural Oregon is finally taking advantage of the economic growth the rest of the state has seen for much of the last decade. As lawmakers, we are all responsible for the economic health of the entire state, urban and rural. However, Rural Oregon is not prepared as well as Urban Oregon for the next downturn because they are still struggling to keep up with infrastructure demands in two key areas: middle income housing and broadband connectivity. The rural housing crunch and lack of internet access are a drag on our rural economies, holding back the kind of job growth and prosperity that can weather the next economic storm. While the kicker should provide tax relief to middle class Oregonians, much of the refund is actually returned to Oregon’s wealthiest. By simply capping kicker refunds to $1,000 per taxpayer, Oregon can retain $500 million in revenue, with nearly half of that money coming from the top 1 percent of taxpayers. This one-time cap would allow a major investment in our rural communities and help pay off schools’ PERS liability at a critical time in Oregon's economic recovery. Governor Brown proposes dedicating $250 million to help pay off the PERS liability of schools, dedicating $220 million to rural housing needs, and $29 million broadband infrastructure in Rural Oregon Funding projects in rural Oregon that boost communities and economic prosperity will help both people and rural cities and counties who are struggling under the PERS employer rates. Approximate Taxpayers Revenue Share of AGI* quintile AGIrange in with reduced raised ($ revenue 2017 kicker millions) raised Lowest 20% Below $15k_ 0 $0 0.00% Second 20% __$15k-$31k 0 $0 0.00% Middle 20% ‘$31K-$55k 0 $0 0.00% Fourth 20% $55k-$96k 24,000 $2 0.30% Next 15% ‘$96k-$193k 219,000 $105 21.10% Next 4% ‘$193k-$436k 71,000 $153 30.70% Top 1% ‘Above $436k 18,000 $239 47.90% Total 331,000 ‘$499 1100.00% ‘Adjusted Gross Income 254 STATE CAPITOL, SALEM OR 97301-4047 (503) 378-3111 FAX (503) 378-8970 WWW.GOVERNOR.OREGON.GOV

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