Portland State University's plan to fund scholarships with a $35 million payroll tax has met with skepticism from business groups, labor unions and Portland Public Schools.

But as PSU moves forward with a November ballot initiative asking voters to approve the tax, it has received $100,000 in backing from its own private fundraising wing.

The PSU Foundation made the donation to the ballot-initiative campaign February 18.

Now the president of the tax's fiercest opponent, the Portland Business Alliance, says its members may stop donating to the PSU Foundation.

"We have heard concerns from many of our members who had made donations to the foundation or to the Simon Benson [Awards] dinner who are concerned about foundation money being used for the campaign," says PBA president and CEO Sandra McDonough. "I have had members say they will think twice about contributing to the foundation."