The Oregon Youth Authority told the Legislature's Public Safety Committee on March 26 that it is seeking to maintain current service levels in the 2025–27 budget and is asking lawmakers to fund priority projects including completion of the McLaren Youth Correctional Facility infirmary and pharmacy, modernization of the statewide juvenile justice database known as JAGES, and implementation support for a Medicaid 1115 waiver.

"Today we continue with House Bill 5041, the primary budget bill for the Oregon Youth Authority," interim assistant director for business services Katie Hudson told the committee as she opened the agency's budget presentation.

The request matters because most OYA spending supports direct care for youth and because the agency is managing rising costs tied to youth mental and medical needs, staffing shortages and deferred facility maintenance. Hudson said the agency's legislatively approved 2023–25 budget was about $500 million, with roughly $400 million in general fund, $46 million in federal funds and $35 million in other funds. The agency said the governor's recommended budget for the next biennium is about $551 million and estimated it would need roughly $517 million to maintain current service levels without cutting core operations.

Agency officials said roughly 72% of current spending goes directly to youth services. Hudson told the committee that almost 87% of the agency's cost‑per‑day for a youth covers core staffing required for direct care and supervision, with the remainder covering nutrition, education, medical care and facility maintenance.

Debbie Martin, the agency's interim legislative coordinator, framed the OYA budget around three priorities: youth and staff safety, responding to rising youth acuity, and returning to basic, data‑driven operations. On safety, Martin highlighted Senate Bill 813 (described by the agency as aligning OYA staff protections with other public safety workers) and the McLaren infirmary and pharmacy renovations. "The renovations will ensure that we can keep youth healthy and provide all statutorily required and constitutionally protected healthcare services," she said.

The agency described several specific drivers of cost growth: increased youth acuity and mental‑health needs; higher overtime from workforce shortages; rising construction, supply and technology costs; and continuing investments in rate increases for behavioral rehabilitation services (BRS). Hudson said the legislature's 2023–25 biennial investments produced an average 41% increase in BRS rates, intended to improve provider sustainability and expand capacity.

OYA also described its information‑technology priorities. The JAGES modernization project — a web‑based juvenile justice information system intended to serve more than 3,000 juvenile justice partners statewide — was placed on hold in September 2024 by Enterprise Information Services because of project risks. Agency staff told the committee five of the seven EIS‑identified resolution categories have been conditionally accepted or resolved and that application development has resumed with new governance and quality assurance measures in place.

Other priorities in the governor's recommended package include funds for a facilities 10‑year assessment, deferred maintenance, upgrades to CCTV and door access control infrastructure (the agency said it now operates roughly 2,100 cameras and needs updated technical support, not new cameras), a housing and reentry coordinator and a small pool of rental assistance funds, and language changes to expand how the agency uses grant authority created by House Bill 4004 (2022). The agency also requested an ability to designate existing vocational and education funds (VSOY) to permanent juvenile direct‑care positions to stabilize supervision of older youth in vocational programs.

Martin outlined a 10% reduction scenario the agency prepared as part of its budgeting process. That scenario would shutter two youth correctional facilities and two transition facilities, eliminate about 100 of the roughly 407 funded close‑custody beds, and would include line‑item reductions the agency quantified as approximately $22.6 million for reduced close‑custody beds, $10.5 million for reduced community parole and placement beds, $2.7 million in county pass‑through reductions, and $7.6 million in program‑support cuts. Agency staff warned such cuts would significantly affect community diversion funds, grants and the agency's ability to maintain facilities.

Agency leaders told the committee they are pressing equity and culturally responsive services as operating principles, while acknowledging recent reviews of the Professional Standards Office and promising to place greater emphasis on safety investigations and transparency. Deputy Director Fuima Ono described equity work as already embedded in staffing investments and culturally responsive programming that the agency said is designed to reduce disparities in outcomes for youth of color.

The agency said it is tracking vacancy rates and other workforce measures: overall vacancy rates had declined from prior highs, but the agency flagged an almost 40% vacancy rate among qualified mental‑health professionals (QMHPs) and continued difficulty recruiting medical, dental and behavioral health staff. The agency emphasized that workforce shortages and overtime remain key budget pressures.

The presentation concluded with leadership urging lawmakers to fund the current service level and prioritized policy option packages. OYA officials said they will follow up with additional details on specific questions the committee raised, including overtime amounts and any estimated savings from the Medicaid 1115 waiver, which agency staff said were still being calculated.

The committee scheduled a public hearing on HB 5041 the following day.