By JONATHAN J. COOPER and NIGEL DUARA
PORTLAND, Ore. (AP) -- Democrat John Kitzhaber defeated Republican Chris Dudley in a tight race for Oregon governor after a protracted vote-counting process that stretched into Wednesday evening.
The former two-term governor had trailed the political newcomer and basketball star in early vote tallying, but made up the difference with votes from heavily Democratic Multnomah County in one of the tightest gubernatorial elections in recent history. Dudley conceded the race Wednesday evening.
With the state budget heading off a cliff and no one certain who's driving, Kitzhaber will have to negotiate a narrow, delicate path to steer the state onto safer financial ground.
He faces a nearly evenly divided Legislature, a state budget gap expected to be as much as $3 billion in the next two-year cycle and an electorate that declined to give him a mandate -- or possibly even a majority -- heading into the statehouse in January.
Kitzhaber didn't declare victory, and spokeswoman Jillian Schoene said the campaign remains "cautiously optimistic" until all the ballots are counted.
Dudley's campaign did not return calls seeking comment.
The candidates spent a combined total of at least $15 million on their campaigns this year. Kitzhaber -- who becomes the first three-term governor of Oregon -- benefited from the Democrats' chief advantage in Oregon: the large registration lead that has grown in recent years. That was due in part to the 2008 campaign of President Barack Obama, who returned to Oregon in the final days of the campaign to urge Kitzhaber's supporters to get out the vote.
Republicans picked up seats in the Oregon House and Senate and were within one seat in each chamber of tying Democrats. On Wednesday afternoon, the Republicans led in those races, but both were too close to call.
The divided Legislature could make Kitzhaber's proposals a tough sell, something he dealt with while vetoing a record 69 bills in 1999 and earning the nickname "Dr. No." On his way out, he called the state "ungovernable." It takes two-thirds of lawmakers in each house to override a veto.
Kitzhaber's plan to retrofit Oregon schools could face a pushback from Republicans loath to spend money on public projects. He has pledged to work with unions to alleviate Oregon's budget crisis, but Pacific University political scientist Jim Moore said the labor groups shouldn't expect a friend in Salem even after contributing heavily to Kitzhaber's campaign.
"For unions, it will be better than what Dudley would have done," Moore said. "The unions are going to have to sit down and talk again about contracts, obligations, and the role of individual union members.
If both chambers indeed tie, it means no bills will get out of the Legislature without bipartisan support -- an arrangement that could force the parties to work together or descend into gridlock. Oregon doesn't have a method for breaking ties in the Legislature, so tied votes fail.
It would be the first time in recent history that both chambers of a U.S. statehouse have been tied, according to the National Council of State Legislatures, which has data back to 1966. Oregon's last tie was in the 2003 Senate, when the parties worked out a power sharing agreement in which a Democrat was Senate president but a Republican leader held expanded power over legislation. A Democrat chaired the powerful Ways and Means budget committee while Republicans controlled the three subcommittees.
"There's two options," Moore said. "One, we enter political deadlock, so the Oregon being 'ungovernable' happens again. Or, more likely, they focus on what can be agreed upon between two parties on what to cut from the budget."
During the campaign, neither candidate was willing to thoroughly describe what sort of budget challenges Oregonians could expect and how wrenching they would be.
Outgoing Democratic Gov. Ted Kulongoski, leaving office after the two straight terms allowed by Oregon law, has described Oregon's budget situation as heading for a cliff, and it doesn't show many signs of brightening.
Twice this year, as state finances deteriorated, Kulongoski called for across-the-board budget cuts that have resulted in teacher layoffs and a prison closing. He and a board of advisers have said sterner measures will be required next year.
A telephone poll conducted for The Associated Press showed that Dudley ran strongly among voters who reported their family's financial situation had deteriorated in the past two years, while Kitzhaber built up a strong base of support among voters who said their family finances were either better or about the same.
Associated Press writer Tim Fought contributed.
Copyright 2010 The Associated Press.