Portland Commissioner Dan Saltzman on Monday gave an emphatic thumbs down to Mayor Charlie Hales' proposal to raise the city license fee on Portland businesses, saying a tax hike shouldn't be the reward for record business growth.
"I don't support it," Saltzman tells WW. "I can't justify a rationale."
He's joined by Commissioner Steve Novick, which means Hales' budget proposal—his last before leaving office—may already be in trouble. He needs three votes to pass his plan. Commissioner Nick Fish is traveling and unavailable for comment. Commissioner Amanda Fritz says she's withholding judgment until she hears from the public.
Hales' proposal, unveiled at a press conference Monday, would raise Portland's business license fee .3 percentage points to 2.5 percent, affecting about 25,000 businesses. Coupled with a tax decrease for a far smaller number of businesses—about 2,000—the changes would generate an additional $8.7 million a year, city officials estimate.
But Portland's not facing a budget shortfall. In fact, it has an unexpected budget surplus of $25 million this year, including an expected $9 million in additional ongoing funds for the next five years. That's thanks to record tax collections from businesses and hotels, as well as slow growth in health care costs at the city.
Saltzman, for one, says it makes no sense to slap businesses with higher fees when they're doing well and the city's not hurting for money.
"To say this is your reward defies logic," says Saltzman.
Hales would like the additional revenue to pay for police background investigators, body cameras for cops, firefighters and additional 911 dispatchers. That's on top of additional commitments to affordable housing and services for the homeless.
But Novick tells reporters he thinks the mayor can make new investments in his top priorities without raising taxes. Other initiatives may have to wait, he says.
"We can balance the budget without touching any of the proposed investments in housing," Novick writes in an email, "while providing critical additional resources for 9-1-1; avoiding bitter cuts to parks programs; and giving the police their top priority, the background investigators."
Novick also says a tax increase on businesses won't help the prospects of the Portland gas tax currently on the May 17 ballot. That's an idea Hales flatly rejected at a press conference earlier in the day. "We need both," Hales said.