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The City Attorney's Office issued an opinion on May 30 that says the tax to fund the Portland Clean Energy Fund applies to far more sales campaign organizers said

FILE PHOTO - A cashier grabs a receipt at the Johnson Creek Fred Meyer.   
WHAT IS HAPPENING? A recent opinion by the City Attorney's Office has raised questions about the future of the Portland Clean Energy Fund approved by city voters at the November 2020 election.

Voters approved a 1 percent tax on the "retail sales" of large companies with at least $500,000 in sales in Portland. The May 30 opinion defined the term "retail sales" much more broadly than supporters of Measure 26-201 said during the campaign.

It now includes practically all such sales, including local construction projects, which could raise the cost of such taxpayer-supported projects as school district renovations and affordable housing projects.

And the opinon questions whether the City Council can approve exemptions to the tax that would withstand legal challenges.

WHO SAID WHAT? The measure was a citizen-driven initiative petition intended to raise funds for clean energy projects that also benefit communities of color.

It was written by advocates with the help of research from Commissioner Chloe Eudaly, who supported the concept. She asked the Revenue Bureau, which will collect the taxes, a series of questions to help refine the measure.

Supporters insisted during the campaign that the term "retail sales" was narrowly defined and would only apply to large retailers, like Walmart. They said it would generate around $49 million a year.

Opponents, which included much of the business community, said the term was not clearly defined and the tax could apply to many more businesses. They commissioned an ECONorthwest study released last July that said it could collect up to $79 million, meaning more companies would pay it.

WHAT CHANGED? After the City Council approved a measure to implement the ballot language, the Revenue Bureau asked the Attorney's Office a series of questions in order to adopt the rules to enforce it, including how "retail sales" is defined.

The Attorney's Office defined the term very broadly, saying there are few exceptions in the measure approved by voters.

"The Ballot Measure defined a 'retail sale' broadly to mean a 'sale to a consumer for use or consumption, and not for resale," the opinion noted.

That means many things purchased by governments, including construction projects, are subject to the tax.

Although 1 percent may not seem like much, it amounts to $2 million on the upcoming $200 million renovation of Lincoln High School, prompting PPS officials to worry about whether it can be completed within the proposed budget. Affordable housing projects funded by bonds approved by Portland and Metro voters also will be affected.

WHAT'S NEXT? Good question. So far the discussions among Portland officials have taken place behind the scenes. Supporter Jenny Lee, advocacy director of the Asian Pacific American Network of Oregon, said the nine-member grant review committee created by the measure should suggest any changes they deem necessary. Opponents have not yet proposed specific changes.

WHAT CAN I DO? Contact information for all council members is available at the city's website at

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