Research shows voters willing to give up personal income tax kicker.

PARIS ACHEN/CAPITAL BUREAU - John Horvick, vice president of DHM Research, and Jim Green, executive director of the Oregon School Boards Association, answer questions on a new poll on revenue reform, during a news conference at the Oregon Capitol in Salem March 13, 2017.SALEM - A new poll shows that a majority of voters would like to see the state curb spending to make up a $1.6 billion revenue deficit but also would support a corporate tax hike if the proceeds were dedicated to K-12 education.

The poll of 600 registered voters by Portland-based DHM Research sheds light on voters' preferences as legislators work on the 2017-19 budget and craft proposals to raise more money. The Oregon School Boards Association commissioned the poll to help guide lawmakers in policymaking this session.

The results provide "a path forward for this Legislature when they look at the budget issues," said Jim Green, OSBA executive director.

About 28 percent of respondents said lawmakers should balance the budget entirely by curbing spending, 60 percent favored some combination of spending reductions and tax hikes and 4 percent preferred only tax increases. Another 8 percent didn't have an opinion on how to solve the problem.

"I think that is in line with where we need to go here in building," House Speaker Tina Kotek, D-Portland, said of the poll results. "…we have groups and members looking at cost containment over the next three to four biennia, and I think you're going to have to couple that with a revenue discussion. It's not an either, or; you need both."

Work groups are discussing potential revenue and spending reduction packages, and lawmakers would need to start considering a specific proposal by mid-April, Kotek said.

Senate Minority Leader Ted Ferrioli, R-John Day, noted that voters in the poll ranked education as the highest priority for spending. He called on lawmakers to set a budget for K-12 and make that safe from cuts before tackling any reductions in the budget.

"If I was going to put an emphasis on it, it was: 'Boy we really need to get a hold of this spending problem and curb the spending, and if that were possible, we should look at revenue sources,' because I think people understand you can't just solve all of your problems with one approach," Ferrioli said of the poll results.

Voters said businesses and corporations should contribute about 40 percent of Oregon's state tax revenue. Corporations now contribute only 6 percent of general fund revenue, according to the Legislative Revenue Office.

Voters overwhelmingly rejected the idea of a general sales tax, even if it went to education, but they are open to giving up their personal income tax kicker refund if the proceeds were to support K-12 schools. The last personal kicker refund equaled about $402 million in 2015, said LRO senior economist Chris Allanach.

OSBA's Green said there is a sense of urgency for lawmakers to take action on the budget and revenue measures, so that school districts have time to plan their budgets and give notice to staff members of their employment outlook.

"We think it's imperative for the legislative leadership and the 90 folks who sit here in the Capitol to move forward with a plan to increase revenue," Green said.

Registered voters representing the state's demographic makeup, including geographic area, age, gender and political party, were interviewed by phone Feb. 23-26. The results have a 4 percent margin of error.

Highlights of the poll:

• Sixty percent of voters think the state should balance its budget through a combination of spending reductions and tax hikes.

• Six-in-10 believe Oregon has a spending problem.

• Ninety-three percent of voters say it's important to fund K-12 education.

• Sixty-five percent of voters would support a measure such as Ballot Measure 97 if the tax revenue were dedicated to K-12 schools. Measure 97 would have levied a 2.5 percent tax on the Oregon sales of certain corporations.

• Voters overwhelmingly defeated the measure, and the poll indicates that voters objected to the fact that the tax revenue was not dedicated to certain purposes.

• On average, voters think Oregon's businesses and corporations contribute about 36 percent of all state taxes collected. In fact, businesses contribute only 6 percent. A majority of voters say businesses and corporations should contribute 40 percent on average.

• Fifty-six percent support a $2 billion increase in funding every two years to education to meet the Quality Education Model.

• Fifty-nine percent are opposed to a general sales tax to fund K-12 education.

• Six out of 10 voters would be willing to give up the 2 percent kicker refunds if the proceeds were placed in a rainy-day fund specifically for K-12 education. (Corporation income kicker refunds were eliminated with Ballot Measure 85 in 2012, and the proceeds were dedicated to K-12).

Paris Achen
Portland Tribune Capital Bureau
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