Big new city tax on the fast track?

The streets of Portland certainly need a lot of work. And it is clear the gas tax dedicated to this purpose is now quite inadequate – because it has been many years since the current rate was set, and inflation has taken its toll on what it can pay for; and, in addition, revenue is actually dropping because people are driving cars that use less (or no) gas.

Led by Portland Commissioner Steve Novick and abetted by Mayor Charlie Hales, the City of Portland is considering a “Street User Fee” to solve the problem -- and after flashing it to a business group in later April, barring the media from attending, reportedly Novick and Hales have put it on a fast track to consider before the end of May, which means something may already be decided by the time you read this.

From the EditorThe accompanying presentation sheet was received by THE BEE from a local business association; at our deadline a later version was passed to us, much longer and unable to fit in this space, but the most significant feature is that instead of an $8 and $12 starting residential option as shown here, now only the higher-cost option is on the table, all the way down the list. Surprise.

We have some real misgivings about this proposal. It now starts with a $12 charge for households to pay – PER MONTH. Neither amount sounds too severe if the money is dedicated for city street repair – but on a per-month basis, that adds up to $144 a year – per household! (For households designated “low income” there is a 30% discount, which still adds up to $67.20 to $100.80 per year.)

But, to keep the taxes at these “low” levels for homeowners, the city expects to whale the tar out of many businesses, as the accompanying “Street User Fee” PER MONTH sample schedule shows.

There have been legitimate complaints over the years that Portland has tended to drive businesses out of the city limits with its fees and taxes, and this sure won’t help. Even nonprofits like credit unions and the Portland Public Schools will have to pay sizeable Street User taxes, according to this sample schedule.

In the example, daycares may have to pay more than motels! And business owners will have to pay residential taxes at home and then pay business taxes again at work – not to mention that a small business based in a home might have to pay two taxes (residential and business) on the same property, even though home-based businesses often generate little or no customer traffic (and, in general, are not supposed to). Some more questions: Will the traffic to each location be measured and updated somehow, or are properties in each category to be taxed by some unexplained average, as the examples appear to show – averages that suggest more vehicles travel to a daycare than to a motel! Will the city have the discipline to dedicate all the funds raised to street repair? Will the streets be repaired across the city, or will this general collection fund repairs in certain specific areas? Will the tax be reduced when the repairs catch up to the need? Since the only way the city has set up for monthly billing to all citizens is the Water Bureau billing system, the bills will be sent out that way, to the same list – although not actually on the water bill. It will be a separate bill. Since water is billed to the property owner, landlords will get these bills for residential tenants and business leaseholders, and will be put in the position of having to be the city tax collector for these tenants. David Ashton has pursued the impacts this tax will have on both homeowners and businesses, and reports on it separately as the headline story in this issue of THE BEE.

We understand at least one or perhaps two members of the City Council are leaning away from imposing this tax without a vote of the people, and with Novick and Hales planning to vote yes, we can only hope three members of the Council vote no.

This plan needs rethinking, and should, when honed and made much fairer, then go onto the ballot for taxpayer approval before being imposed on us all.

Contract Publishing

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