SALEM -- Gov. Kate Brown was sworn in for the first time as Oregon's elected governor on Monday and outlined her agenda for the 2017 legislative session.
In a speech that also served as Brown's State of the State address, she balanced aspirations for Oregon in the wake of Donald Trump's presidential victory against the hard reality of a looming partisan fight over state spending.
Brown didn't name Trump but presented Oregon as a refuge from some of the racist and partisan rhetoric stirred by last year's election. She highlighted Oregon's work for equality and said "we can not and will not retreat."
But the governor primarily focused on her policy goals and said she wants to reform Oregon's tax system to end the rollercoaster budgets the state has endured for longer than her 25 years in public office .
Oregon faces an estimated shortfall of at least $1.7 billion, assuming the state maintains current services over the next two years. That's despite an economic rebound that Brown said has received "glowing" coverage in national media.
"We now have two modern-day Oregon trails to choose from," said Brown, a 56-year-old Democrat who first assumed office in February 2015.
One of those paths would continue "the endless process of slicing and squeezing, of diminishing our hopes and expectations, and shrinking our dreams of what it means to be an Oregonian," she said.
The other trail follows former Gov. Tom McCall's advice to "not be guided by regionalism and factionalism," she said, but instead to "work in partnership, rather than partisanship."
Neither tax reform nor another top challenge Brown invoked Monday -- the state's $22 billion unfunded pension liability -- is on the governor's official 2017 legislative agenda. Still, Brown insisted, she wants to work with lawmakers to address the state's public pension crisis.
Specifically, Oregon must "ensure that no one can take advantage of the (pension) system," Brown said.
Brown has previously called for restructuring the Oregon Treasury's investment management division to save fees paid to Wall Street. That idea, which has failed repeatedly in the Legislature, would save just $1 billion over 20 years, the Treasury has said.
But when asked about other reform ideas at a news conference later Monday, Brown didn't offer any by name.
"There are a number of options on the table that we are thoroughly examining," she said.
This year, Brown's legislative agenda includes passing a transportation funding package that eluded her and legislative leaders for the last two years. She also wants to create a fund to improve high school graduation rates, pass gun control legislation and expand Oregon's Medicaid program to cover all children .
Brown noted the happier circumstances of Monday's inauguration, compared to when she was first sworn into office two years ago after Gov. John Kitzhaber's resignation.
Kitzhaber resigned in February 2015 amid state and federal influence-peddling investigations involving the private work of his fiancee, Cylvia Hayes. Kitzhaber has maintained he's innocent of wrongdoing. Now, Brown will serve out the remaining two years of what would have been his fourth term.
Although former governors Ted Kulongoski and Barbara Roberts attended Brown's inauguration, Kitzhaber did not. Former Gov. Neil Goldschmidt, whose career crumbled after he admitted sexually abusing a teenage girl when he was Portland mayor, also was absent. All former governors were invited.
Jim Moore, director of the Tom McCall Center for Policy Innovation at Pacific University, said Brown delivered "a good state of the state address" that "laid out policy ideas in a clear way," but the challenge for Brown will be finding ways to line up support from lawmakers.
"It sets her up well, but it's really in the Legislature's court right now," Moore said.
To that end, Brown made a point of reaching out to lawmakers who could provide crucial votes for her agenda in 2017. Because Democrats are just shy of holding the three-fifths supermajorities required to raise revenue, they need at least a couple of Republican votes in both the House and the Senate.
Brown aimed for a bipartisan tone, bookending her speech with quotes from Republican governors McCall and Mark Hatfield. She complimented current legislative Republicans as well as independent-minded Democratic Sen. Betsy Johnson of Scappoose.
The governor also acknowledged Oregon's rural areas have not shared equally in the "overnight and out of control" economic recovery centered in the Portland metropolitan area, a point frequently raised by legislative Republicans who largely represent those areas.
"For families living in Columbia, Coos, Crook or any of our rural counties, we must burst open the doors of opportunity so that individuals can find good paying jobs right where they live," Brown said, before ticking off a list of ongoing economic development initiatives.
She also pointed out the potential rural benefits in a transportation package, and highlighted a manufacturing initiative championed by Johnson, who sometimes votes with Republicans and could provide a crucial vote on transportation funding and revenue reform.
Lawmakers' reactions to Brown's budget proposal last month illustrate the governor's challenge.
Sen. Richard Devlin, D-Tualatin and co-chair of the budget writing committee, ruled out "flat funding" for universities as Brown had proposed. And Senate President Peter Courtney, D-Salem , reiterated in an interview Friday that Brown's budget was not balanced because it relied on revenue proposals lawmakers have not approved.
At Courtney's prodding, Devlin and budget committee co-chair Rep. Nancy Nathanson, D-Eugene, plan to release a proposed 2017-19 budget next week, earlier than in some previous sessions.
Courtney said he hopes to wake people up to the need for "a bigger, a better budget" and "the fact that we're not going to get through this without some more revenue."
Unlike Brown's budget proposal, which assumed the Legislature would pass tax increases, the legislative budget proposal will be based on the state's existing revenues.
"The budget is unacceptable, that's what I'm hoping people will conclude," Courtney said.
Courtney said there's a strong possibility lawmakers won't agree on a budget by the end of the regular session in July and will be forced to return for special sessions this summer.
Asked later for a progress report on her push for revenue, Brown told reporters she would be "convening a couple of stakeholder groups to work through the various options." But she didn't say how those talks might go.
"We will be having further discussions," she said, "and more formal conversations over the next few weeks."
The Oregonian/OregonLive's Gordon Friedman contributed to this report.
-- Hillary Borrud