The Portland Business Alliance has been a key player in the effort to convince regional government Metro to refer an estimated $250 million-a-year ballot measure to fund homeless services.
But now the group of downtown businesses is opposing the planned mechanism to fund that measure: a tax on high-income Portlanders.
In a letter sent today, the Portland Business Alliance asks Metro Council president Lynn Peterson for a payroll tax instead.
The PBA acknowledges a tax on high-income earners appears popular with voters, but say that's not a sufficient rationale.
"The coalition was provided guidance to not accept this revenue mechanism due to campaign considerations," write Andrew Hoan, president & CEO of PBA and developer Vanessa Sturgeon, who is PBA board chair, in the letter. "We respect the coalition process and remain committed to it. Our position is that political calculations alone should not govern the funding mechanism for this measure."
The proposal from the nonprofit groups pushing for a tax has been to impose an income tax on individuals earning $125,000 or more.
Metro Council is expected to vote on referring the measure on Feb. 20. The regional government and homeless advocates are seeking to present the measure to voters for the May 19 election.
Peterson and the coalition supporting the measure did not have immediate comment on PBA's letter.
In their letter, Hoan and Sturgeon cite several policy arguments against tax people earning high salaries, among them:
"Asking only one small and highly-mobile group of individuals to pay for this does not present the society-wide policy solution that this initiative seeks to advance," they write.
Hoan and Sturgeon also argue that a payroll tax would be more popular with voters if that option included an an exemption for small businesses and the decision to only tax higher salaries on company payrolls.
The letter says the PBA board has voted to endorse both Metro's November transportation measure and the homeless services measure—on the condition the latter sunsets in 10 years and is a payroll tax.
PBA says it's unclear what its position will be if the tax isn't changed.
"The Alliance board has not formally adopted an endorsement for the homelessness services measure proposed by Here Together, but with these changes to the funding mechanism, this measure could earn our endorsement," Hoan and Sturgeon write. "We hope you'll take our recommendations into consideration in crafting a resilient revenue mechanism."