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A court hearing on the scope of the regional government's collection power is set for May 21.

PMG FILE PHOTO - Metro's Newell Creek Canyon in Oregon City has seen an increase in environmental damage due to illegal camping. Metro, the regional government, soon will begin gathering taxes to address homelessness, but the measure is being challenged in court.Questions continue to swirl around the scope of Metro's authority to collect income taxes, including those for its $250 million-per-year homeless services measure.

The Multnomah County Circuit Court has scheduled a hearing on the scope of Metro's authority for May 21. Concerns have been raised by a coalition of businesses and business organizations, including the Portland Business Alliance.

The issue is larger than the measure approved by regional voters at the May 2020 election. They include whether Metro is required to comply with Oregon constitutional and statutory provisions that expressly apply to the elected regional government, or whether it has more authority to tax under its charter approved by voters in 1992.

The coalition argues the former.

Multnomah County Chair Deborah Kafoury has included $55 million as the county's share of the taxes in the budget she is proposing to take effect on July 1. She says the money will greatly reduce homelessness in the county by providing needed services to the homeless and those at risk of homelessness. It is expected to increase to $100 million in future years.

Metro asked the court to validate its collection authority. Following that, the coalition responded. They agree Metro has the right to impose the taxes approved by the voters. But they argue the rules for administering the tax must be the same as the Oregon Department of Revenue's rules for collecting such taxes.

Metro's rules are different, making complying with the tax more difficult, the coalition argues. In addition, some businesses could pay more taxes than that would be required under the state rules, the coalition also said.

Metro admits that its rules are different, but argues they are legal because they were adopted under its voter-approved home rule charter. Both sides have submitted lengthy and detailed files arguing the fine points of numerous court rulings on tax law and the authority of home rule charters.

Judge Steffan Alexander will conduct the hearing remotely.

The measure was approved by a majority of voters in all three counties within Metro's jurisdiction. It will collect a 1% income tax from people who make $125,000 annually or couples who earn $200,000 combined. It also includes a 1% tax on businesses that generate $5 million annually.

The funds will be distributed to Multnomah, Washington and Clackamas counties to support services to help prevent people at risk of losing their housing in their homes, and to keep the chronically homeless in their subsidized housing. The counties must submit plans for spending their share of the funds to Metro for approval.

The measure took effect on Jan. 1 and first quarter taxes are already due. Metro is contracting with the city of Portland to collect the taxes.


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