Lawmakers from throughout Washington County have begun cheerleading for a new revenue package, holding a town hall Friday night at the PCC Willow Creek Center in Beaverton.
The goal: To convince an estimated 50 area residents that a Democratic package of new taxes and new revenue will help stabilize the state's boom-and-bust cycle economy.
It was an easy sell: Nine Democrats made the case to a room full of education and social service advocates.
Sen. Mark Hass of Beaverton and House Speaker Tina Kotek of Portland — two leading Democrats who didn't attend Friday's town hall — have crafted a tax reform plan to address the state's $1.4 billion revenue shortfall. The plan would raise an estimated $900 million in the next two years.
The plan would temporarily hike corporate income taxes in 2017 and 2018 from 6.6 percent and 7.6 percent, to 8 percent and 9 percent in order to help raise the $900 million. The corporate income tax then would be repealed in 2019 and replaced with a commercial activity tax on businesses with annual sales of $3 million or greater. The change would effectively mean small businesses would no longer have to pay corporate taxes, only a $250 filing fee. The commercial activity tax would yield an estimated $1.1 billion in 2019-2021.
Rep. Margaret Doherty of Tigard led the charge Friday, outlining the plan for a receptive audience and explaining how the proposal would "smooth out" Oregon's volatile tax structure.
With the state's reliance on income tax and no sales tax, Oregon tends to free fall into reception and to rocket back out during good times. The proposal is designed to increase revenue, but also to decrease the rollercoaster effect of the state's highly elastic revenue stream.
Republicans have opposed the proposal, saying Oregon has plenty of taxes but a "spending problem."
Rep. Mitch Greenlick of Northwest Portland, whose district reaches into Washington County, agreed — to a point. "We do have a spending problem," he told the crowd. "We don't have enough money to spend."
Doherty said that cuts necessary to balance the state's $1.4 billion shortfall — and states are constitutionally required to balance budgets — would mean painful reductions to popular programs. She said 93 percent of the state general fund goes toward public education, public safety, health care and human services.
Veronica Williams of Tualatin came to Willow Creek to ask if the business community is prepared to back this proposal. Corporate lobbying is credited — or blamed — for last year's defeat of Measure 97, a corporate tax plan that would have raised about three times as much as the current proposal.
"We just can't keep saying 'no' to revenue solutions," Williams said.
Louise Currin of the Aloha area is a former public school employee. Her issues are increasing class sizes and cuts to programs aimed at helping students from low-income families.
She said the Democrats proposal won't solve the problem, but she backs the plan nonetheless. "This doesn't get us where I want to be. But it gets us on the road."
Other participants in the town hall included Sen. Chuck Riley of Hillsboro and House members Jeff Barker, Aloha; Ken Helm, Beaverton; Sheri Malstrom, Beaverton; Susan McLain, Forest Grove; Janeen Sollman, Hillsboro; and Rep. Brad Witt, Clatskanie.
Second town hall
Lawmakers gather from 10 to 11:30 a.m. today, Saturday, June 17, at Wilson High, 1151 S.W. Vermont St., for another town hall on the revenue proposal. Participants include House Majority Leader Jennifer Williamson and State Reps. Margaret Doherty, Mitch Greenlick and Ann Lininger.