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Measure 84:

Eliminates estate taxes


We understand people’s aversion to “death taxes.” Many Oregonians who hope to pass on a bit of accumulated wealth to their heirs are startled to learn that a portion of their estate may be taxed before their loved ones receive a dime.

In truth, few Oregonians are affected by this. Oregon imposes a tax only on the the portion of an estate exceeding $1 million. The provision affects about 1,000 families per year, or less than 5 percent of all Oregon estates.

Still, the tax can sting those who own a business, farm or timber land.

Oregon lawmakers are aware of this tax and last year took steps to shelter smaller estates. Still, there may be more work to be done and if estate taxes were part of a broader discussion on tax reform, we’d support that.

But Measure 84 brings a meat ax to a job that is better suited for a scalpel. It would completely eliminate Oregon’s estate tax and grant family members the ability to swap property without paying taxes. The provision to phase out Oregon’s estate tax over four years would cost the state $256 million in the 2017-2019 biennium, a year after the tax fully phases out, according to an analysis by the Oregon Legislative Revenue Office. Oregon is expected to collect $195.6 million in the current biennium (2011-2013).

The second part of the measure, which would exempt gifts between family members from taxation, creates confusion.

Let’s say grandma buys a house for $50,000. Years later, her house is worth $250,000. If she sells the house at the market rate, she’ll now incur capital gains tax on the income earned from the difference in value. But under one interpretation of Measure 84, if she sells her house to her grandson for $250,000, the state can’t collect capital gains tax. The grandson could then sell the house for $250,000 and incur no tax (because there was no gain).

The loophole, if realized, could reduce capital gains taxes by 5 to 25 percent, according to the revenue office, at a cost of $50 million to $175 million annually.

To be fair to the measure’s authors, it’s not clear if this scenario would occur. But that’s the point.

Even if you like the idea of cutting taxes on the recently departed, the second clause of this measure is frighteningly broad, setting the state up for another backdoor tax loophole that favors those with tax lawyers in their employ.

If the legislature wants to adjust the $1 million threshold or set up a tiered tax system that recognizes the peculiarities of farm and forest land, we’d support the effort. But Measure 84 is just bad legislation.

Measure 79:

Amends constitution to ban

real estate taxes


The measure, to put a ban on real estate transfer taxes into the Oregon constitution, has aptly been described as a solution in search of a problem.

Oregon state law already bans the imposition of a tax on the sale of real estate and any effort to change that would require a two-thirds vote of the Oregon Legislature and the signature of the governor. Many lawmakers have proposed such a tax over the years and all of them have failed.

What’s more, there’s no proof that such a tax is onerous.

The state ban was enacted after Washington County had already imposed a real estate transfer tax of one-tenth of 1 percent of the sale price. As we’ve seen, it hasn’t stopped private investment in real estate development. Perhaps that’s why the Oregon Business Association is urging a “no” vote on this measure.

So do we.

Our pledge: To be worthy of your support

Last Wednesday was a remarkable day for journalism in western Washington County, heralding the return of a newspaper war in Forest Grove — something that hasn’t been seen for at least seven decades.

The Forest Grove Leader, a new weekly publication of The Oregonian, made its debut and featured a lively mix of news and sports. The 12-page paper, though light on ads, surely won itself some fans among the masses who picked up those ubiquitous, soggy plastic bags off their lawns and driveways.

The News-Times, meanwhile, countered with its largest paper of the year (26 pages plus a pair of special sections). Several people asked whether was coincidental.

It wasn’t.

But this wasn’t a case of us puffing up our chest to send a message to a challenger whose stated purpose is to put us out of business. Rather, it was you — our readers and advertisers — who made the statement.

The size of our weekly paper is determined by the amount of advertising space that’s reserved, and last week’s ad count went through the roof, fueled in part by several advertisers who took a week off promoting their own goods and services and instead promoted their hometown paper.

For years we’ve chronicled this community’s amazing support of other institutions — from its city library and local schools to a restaurant ravaged by fire.

Last week, we got to see what it’s like to be on the receiving end of that generosity. It’s both humbling and empowering.

The full-page ad with its pledge of support for the News-Times was particularly moving. Penned by one of our readers and underwritten by a local insurance agency, it described the News-Times as “the beating heart of Forest Grove and surrounding smaller communities ... as vital as roads, electricity, police, the fire department, our schools, and churches.”

The paper, it continued, “assures us our best chance of a healthy democracy in our little corner of Washington County and provides us a place to turn when our questions go unanswered ...”

Signed by 63 people, that pledge was a sobering reminder that this little publishing tiff has big stakes.

If you look at the staff and resources of the News-Times compared to what’s available to The Oregonian, this appears to be a lopsided fight.

But when you consider who’s got our back, we like our chances.

Thanks to all of you who have given your pledge of support. You now have our pledge to strive to be worthy of it.

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