News & Insights
State of Play
Oregon’s baseline economic forecast only a few months ago called for a slowing economy but not a recession. State economists then aligned their expectations with the “soft landing,” where the Federal Reserve steers the national economy through a contraction without driving it into a recession. Today, during a joint hearing of the legislature’s revenue committees, the economists released an updated revenue forecast where they switch lanes.
On November 8, Oregonians cast their ballots in contentious races up and down the ballot, including congressional, gubernatorial, and state legislative campaigns. In 25 of Oregon’s 36 counties, voters also determined the fate of 51 local funding measures. The tax and spending proposals varied across the board, including creating new and reauthorizing existing funding mechanisms. Overall, 36 of 51 (70 percent) local funding measures were approved by voters, suggesting that Oregonians remain willing to open their pocketbooks for services within their communities.
Republicans breaking through the supermajority ends the political threat of unilateral tax rate increases, but it does not end the threat of tax policy changes intent on raising revenue. With tighter margins in the legislature and a state budget facing a slowing economy, the propensity for Oregon to come up with new and controversial ways to raise revenue likely increases.
For the third consecutive election cycle, advocates for a univeral basic income are pursuing a ballot initiative imposing a gross receipts tax to send checks to residents. Oregon’s Department of Revenue abandons controversial proposal requiring out-of-state businesses to pay income tax if they have a website. And a gripe about griping about tax incentives.
Election season is well underway, but lawmakers briefly paused campaigning for a series of virtual committee meetings. Typically, the opposite is true. Incumbent lawmakers generally use their bully pulpits to show they are leading or, at the very least, standing up to the “other side.” This week was different, with temperaments staying mostly above the fray and lawmakers engaging in their regular interim business.
Oregon considers adopting a controversial policy from the Multistate Tax Commission reinterpreting a federal law insulating businesses from state taxes if their only connection to the state is soliciting tangible property sales. Oregon’s Quality Education Commission accuses the legislature of pocketing funds constitutionally set aside for public education. And the City of Portland may move to update the region’s tax code.