SALEM — Gov. John Kitzhaber called for changing the state’s involvement in public education and increasing overall spending by nearly 11 percent over current levels in his proposed budget, released Monday.

The governor’s proposed $18.6 billion 2015-17 budget focuses primarily on funding kindergarten and early literacy programs, with Kitzhaber pledging to increase education spending by 9 percent, to $9.4 billion, in the next two years.

If health care and prison-sentencing changes continue to save the state money, if the economy doesn’t tank and if the state doesn’t have to give any rebates to Oregonians, Kitzhaber said, the state will start to build a budget surplus in 2021.

“The state’s role in education has got to change from that of simply a passive funder of enrollment to an active, strategic investment in outcomes. And that’s exactly what this budget seeks to do,” he said.

The proposal would put about $440 million toward full-day kindergarten, early learning and third-grade literacy programs, with Kitzhaber pledging to get 95 percent of students reading by grade three in the next five years, up from about 68 percent today.

The Legislature will now take into consideration the governor’s proposal as it creates its final budget, which must be passed and signed by July next year.

In addition to ramping up education spending, Kitzhaber proposes spending $4.9 billion on human services and $3 billion on public safety and the judicial system. Those areas account for 93 percent of overall proposed general fund/lottery budget spending.

Education funding starts at around $6.9 billion in the next budget before accounting for Kitzhaber’s proposed increases.

Eighty-three percent of the $18.7 billion expected revenue in the next biennium comes from personal income taxes. Fifteen percent comes from all other taxes and the lottery.

Kitzhaber said his proposal takes successful savings and increased revenues from his first term and allows the state to invest in what he called an “equity budget” that helps the entire state.

“Today we have an opportunity to make smart investments in Oregon,” he said.

Kitzhaber is asking the Legislature to create a $21 million Working Family Addition credit that he says would help people avoid a benefits “cliff,” or loss of benefits by recipients when they make more money.

There are 18 tax credits that will sunset during the next biennium. Kitzhaber is asking the Legislature to extend all of them.

His budget includes calling for $100 million in bonding authority for seismically upgrading schools and emergency buildings. Senate President Peter Courtney, D-Salem, proposed in August spending about $200 million to upgrade schools.

Courtney on Monday called the governor’s proposed budget “the first step in the process” and said he’s asked the co-chairs of the Legislature’s budget-writing committee to submit a draft by mid-January.

Republicans, who lost seats in both the House and Senate and remain in the minority, used the governor’s release to set up what will likely be a theme next session, with House Republican Leader Mike McLane, R-Powell Butte, calling for “proper oversight and accountability” of the increased spending.

“While the increased focus on education is welcome, we need to ensure that our resources are leading to better outcomes for our students and families,” McLane said in a statement. “Simply throwing more money at the problems is not going to solve them.”

The budget also drew slight criticism from the state’s higher-education leaders, who said the proposed $500 million for community colleges doesn’t do enough to restore cuts endured during the recession.

“Oregon and Oregon families need a strong ladder to the middle class, which means they need healthy community colleges,” said Andrea Henderson, director of the Oregon Community College Association. “Our future economy, jobs and quality of life depend on it.”

— Reporter: 406-589-4347,

tanderson@bendbulletin.com