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EXECUTIVE SUMMARY <br /> 1Vote to readers: Much of this report's employment levels for several quarters (one <br /> narrative was written in the late summer time percent or more on an annualized basis), it's <br /> <br /> frame. Obviously the calamities that have expected to come back stronger than the <br /> since hit financial markets both here and nation's as the housing situation stabilizes <br /> increasingly abroad make the economic nationwide. <br /> backdrop to our forecast somewhat <br /> impertinent. It is, nevertheless, fairly As we would expect, an economic downturn <br /> consistent with the outlook from the most in jobs and real personal incomes does not <br /> recent State Economic Forecast (Sept. 2008). bode well for the outlook for transportation <br /> revenues. For revenues that are linked to the <br /> As for the nation overall, Oregon's economy pace of economic activity (fuel and weight- <br /> appears to be confronting considerable mile taxes), the impacts are pronounced <br /> headwinds. The string of 19 consecutive compared to the prior forecast in December <br /> quarters of j ob gains appears to have ended in 2007: <br /> the second quarter of 2008, a 4 3/4-year span <br /> going back to 2003: III. This pales, somewhat • Motor fuels usage taxes are lower on <br /> unfortunately, to the very long-lived boom average by $11.4 million per year over the <br /> covering 39 consecutive quarters that FY09-FY13 period; about 2.6 percent <br /> occurred in the 1991- 2000 period. lower than before. Ethanol blending in <br /> gasoline props revenues up a bit, <br /> Softening in the job markets nationwide is otherwise the drop off would be worse. <br /> expected to last for about five quarters out <br /> through the spring of 2009. Oregon, on the • Weight-mile use taxes decline on average <br /> other hand, is not anticipated to endure such a by nearly $15 million annually; about 5.2 <br /> lengthy malaise. This contrast emanates in percent lower than the prior forecast. <br /> large part from the nature of this business <br /> cycle compared to the past two cycles in For fee revenues not closely tied to the <br /> 1990-1991 and in 2001-2003. intensity of usage on the highway and roads <br /> system, the revenue impacts are somewhat <br /> While memories of the job recession induced more muted: <br /> by the "dot-com" bust in 2001-2003 are <br /> understandably more vivid, that downturn . DMV yearly revenues are down on <br /> was led by a collapse in business fixed average by $1.7 million per year, or only <br /> investment spending in equipment and about minus 0.6 percent. <br /> software. The present cycle is being driven, in <br /> contrast, by the housing collapse and The expenditures by ODOT that are necessary <br /> attendant troublesome times for the balance to maintain, preserve, and modernize the State <br /> sheets of a wide variety of financial Highway System, however, will not <br /> institutions. The current situation has more materially change with weaker travel <br /> similarities to the housing and S & L crisis in demands going forward. With these costs <br /> 1990-91 than to the dot-com calamity in being largely fixed, the funding gap with <br /> 2001-03 . So, while the Oregon economy is diminished user tax revenues is only <br /> expected to have several pronounced drops in exacerbated. The shortfall is further <br /> 1V <br /> <br />