Oregon Legislature Approves Gov. Kate Brown's Tax Break For Business

By Lauren Dake (OPB) and Dirk VanderHart (OPB)
Salem, Oregon May 21, 2018 11:05 p.m.

Amid apprehension from both Republicans and Democrats, Gov. Kate Brown managed to usher a deal through the Oregon Legislature on Monday to give tax breaks to some of the state’s businesses.

Republicans criticized the one-day special session as an election-year political stunt, while Democrats said the tax cut comes at a time when the state is in desperate need for money to fund schools and health care.


The measure, however, sailed through the House with a 51-to-8 vote; the Senate passed it 18-12.

Brown called the special session with the idea of expanding a lower tax rate to businesses known as sole proprietorships. But the governor's goal of getting the proposal pushed through in a single day faced doubts. Republicans are still rankled that Brown blocked a set of larger business tax cuts in April.

They made that displeasure plain on Monday.

“It’s as if a thief comes and steals $100,” said Rep. Mike Nearman, R-Independence. “When he comes back the next morning and offers you a dollar, you take it. This session is nothing more than a thief sheepishly crawling back.”

The governor cast the session in a different light, saying it would help some of the state’s smallest businesses. Analysts suggested about 75 percent of the tax break would go to those earning more than $200,000 a year. The state estimated about 12,000 tax filers could qualify for the tax break, but that only about half of them would take the option.


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Republicans who denounced the governor's motives included Knute Buehler, the GOP gubernatorial candidate, who Brown will face in November.

"I think we can all agree that this is an emergency that is manufactured by the governor — manufactured by a choice she made last session … when the governor decided not to reconnect with the federal tax changes,” said Buehler, of Bend. “I happen to think that Oregon has more significant emergencies."

Democrats on the House floor remained largely silent. Less than a year ago, Democrats pushed to curtail the very tax their governor was now asking them to expand.

House GOP Leader Mike McLane addressed talk that Democrats would move again to repeal the tax break in future years.

“The question becomes why are we going to vote on expanding what will surely be repealed by the majority party in a year?” McLane, R-Powell Butte, said. “If this majority party votes to repeal the small business tax cut next year, this will be one of the greatest mockeries of the special session in the history of Oregon.”

The Senate, like the House, largely featured speeches by Republican lawmakers deriding a session they saw as a political stunt.

"This bill is pure politics," said Sen. Herman Baertschiger Jr., R-Grants Pass. "Everyone in the chamber knows it, everyone in the gallery knows it and everyone in the other chamber knows it. It’s an election year, that’s how it goes."

The bill passed easily in the Senate, despite speculation earlier in the day that Brown might not have enough supports to muscle it through.