THE BIG NEWS out of Salem last week was bad news and then worse. First the state announced that it is facing a budget hole of $562 million that will haunt Oregon for the next decade if it's not fixed. Two days later, State Economist Tom Potiowsky said—whoopsie—due to a math error, that hole is actually $577 million deep. Apparently his office mistakenly thought the state gets 22 percent of each $1.18 it levies in cigarette taxes. It actually gets 22 cents.

We can't invent a time machine to fire whoever is responsible for that $15 million screw-up (because they will be fired... right?) but Governor Ted Kulongoski's solution for the budget debacle isn't much better: He's asking every state agency to slash its budget by nine percent. Even he doesn't think it's a great idea, telling press on Tuesday, May 25, "I do not like the option of across-the-board cuts... a governor should be able to make more targeted cuts in one area to prevent greater harm in another." Sigh. Rather than settle for a budget plan no one likes, we asked some smart, budget-savvy Oregonians for good ideas on how to cut the fat and raise revenue without crippling our state.

Cut Mandatory Prison Spending

Three voter-approved measures, starting with Measure 11 in 1994, have handed down stiff mandatory minimum prison sentences for people who commit certain crimes in Oregon. Though tough-on-crime advocates say these inflexible policies have helped cut crime in Oregon, their financial impact has been huge. Oregon's prison population has doubled in the past 15 years, forcing us to spend nearly 13 percent of our entire general-fund budget on corrections. Throwing out these constitutional amendments is unlikely (we'd need a statewide vote), but the legislature could potentially revise them.

"We need to be reviewing all options," says Democratic Speaker of the House Dave Hunt. He thinks that, at least, voters should reject a new mandatory minimum measure likely heading to the ballot this fall. "It's another lock 'em up, throw away the key mandatory minimum sentence that pretends it doesn't have any impact on schools or any other service," says Hunt.

Kick the Kicker

One of Oregon's unique and most staunchly defended financial policies is the kicker: When the state economist (you know, the one who made the cents vs. percents math error?) underestimates the amount of surplus revenue the state makes, the government mails a check for the difference back to corporations and individuals. We're certainly kicking ourselves now for kicking back $1 billion in 2007. Instead, say numerous legislators, when the state has extra money, it should go into a rainy day fund.

"We need to get rid of both kickers and not squander unanticipated income like we have been," says Chuck Sheketoff, director of the Oregon Center for Public Policy.

Invest Early in Education and Crime Prevention

Even though the state made massive cuts last year, one area that the legislature voted to keep entirely intact was Head Start early education.

"We did not cut one dime out of Head Start and actually increased our investment," says Representative Hunt. Why? Because a few pennies invested in prevention—which means early childhood education, along with things like mental health care—is proven to keep people more employed and out of prison in the long run. That saves the state money.

Host a Yard Sale

Not the best idea, but the only one that's happening for sure. With declining budgets and a huge influx of seized property from "several high-profile theft cases," the state's surplus property program is publicizing a giant sale it plans to host on June 5. While the extra bikes, bus shelters, gun parts, and assorted other old government supplies or seized goods are usually auctioned off on eBay, the government hopes to raise $50,000 with its "Saturday Sale" at the Property Distribution Center in Salem.