A Better Oregon, a coalition of nonprofits spearheaded by the union-backed advocacy group Our Oregon, today announced they will ask lawmakers to pass a tweaked version of Measure 97, the $3 billion tax increase voters just rejected 59 percent to 41 percent.

The tax voters rejected would have taxed C corporations—usually large, often publicly held companies—2.5 percent on their Oregon sales over $25 million.

The new proposal includes some changes aimed at addressing the concerns of Measure 97's critics.

It raises the threshold from $25 million to $100 million (which probably exempts popular Oregon companies such as Powell's Books and Umqua Dairy). It exempts utilities, which reduces the burden on lower-income Oregonians. And it includes all companies, not just C corporations (which makes it more fair), and lowers the tax from 2.5 percent to 2 percent.

Those tweaks reduce the projected revenue from $3 billion to $2 billion a year.

But in a report released today, A Better Oregon says the need for government services remains great, so the coalition proposes expanding a healthcare provider tax that is primarily paid by hospitals currently.

That tax, which is 5.3 percent, triggers a matching grant from the federal Center for Medicaid Services. A Better Oregon wants to expand the tax to include other healthcare providers including dentists, chiropractors, managed care facilities and ambulatory service centers. That expansion could raise another $1 billion a year.

Members of the coalition will continue to emphasize the lower level of taxes Oregon businesses pay.

"When we better fund education, health care and other critical services we improve the productivity and vitality of the our state," said Hanna Vaandering, the president of the Oregon Education Association. "We as a coalition refuse to accept cuts to services for students and those in need as long as corporations in Oregon are paying lower taxes here than anywhere else in the country."

To pay any new tax in Salem, proponents need a three-fifths majority in both the House and the Senate. Democrats are currently a vote shy in both chambers: they control the House 35-15 and the Senate 17-13.

It's always tough to get Republican votes for new taxes and may be particularly difficult in the wake of November's election results.

House Republican spokeman Preston Mann provided a flavor of what coalition members can expect when they introduce their proposal in the Legislature next year.

"It says a lot about Democratic politicians and government employee unions that even in the face of an overwhelming defeat, they still have the audacity to stand before Oregonians and demand massive new tax increases with only vague details about how the money will be spent and a hardline stance against budget reform," Mann said in a statement. "The hubris of Democrats in Salem knows no bounds."