Portland City Council weighed options Wednesday for altering the city’s arts tax. Voters last November approved a $35 per household tax supporting arts education and arts organizations.
The tax is subject to several legal challenges, but the city’s attorney’s office says he’s confident those will be resolved.
So one of the council’s main concerns is bringing tax revenues in line with projections. So far, because of delinquent payers and others factors, revenues have come in about $2 million below projections.
Some suggest the structure of the tax adversely affects people in low income brackets. Problems have cropped up with voters being assessed for PERS benefits, Social Security, and other kinds of income.
There’s much to keep in mind. Some of the six proposed models would increase individual taxpayers’ liability.
Changes might also have a big influence on the administrative costs of the program. Double the number of people exempt from the tax, and you double the work that has to be done processing exemptions.
The tax voters approved caps administrative spending at 5 percent of the revenue collected.
Mayor Hales says he’s inclined to take up changes that would exempt some more people in lower income brackets, provided the basic payment doesn’t increase exponentially for taxpayers who are still liable.
“With a brand new tax we had hundreds of thousands of people voluntarily sending in a tax. I think we have a fairly clear mandate this is something people want. We also have obligation not to stray too far,” Hales said.
Commissioners Amanda Fritz and Nick Fish generally agreed, modifications are appropriate.
Commissioner Dan Saltzman said he felt voters didn’t approve collection of a target revenue sum, but rather a $35 flat tax.
“I really feel doing anything on the basis of equity, further increasing the poverty level is a breach of faith with voters. That is something this city council can ill afford at this time,” Saltzman said.
Commissioner Steve Novick did not support the tax, because people of all income levels are liable to the same tax bill. But he says he thinks it’s right to make the tax more progressive now.
What, he asked, would Woody Guthrie, who wrote so many folk songs about the northwest have thought of a tax that made rich and poor pay the same amount.
Hales envisions sending a proposal to a citizen oversight committee in September, and hopefully put it before council in October.