Business Group Seeks To Derail Tax Funding For Education

Oregon Manufacturers and Commerce, a new business lobbying group, filed a petition on Thursday, May 30 to stop a new tax on business passed by the legislature to fund a $1 billion education bill. If their petition collects 75,000 signatures, the tax funding for the new education bill would be stalled until it is decided by statewide ballot measure in early 2020. 

The legislature passed a 0.57 percent tax on business with more than $1 million in revenue per year. Unlike other gross receipts tax proposals, businesses are allowed deduct portions of their costs, and also exempts food, health care, and gasoline sales from the tax. 

Challenges from business interests were not entirely unexpected. Governor Kate Brown already cleared this version of the tax with Oregon’s largest business lobby, Oregon Business & Industry. OBI negotiated with Brown, moderating the specifics of the tax in exchange for their neutrality on it should it come to the ballot box. 

OMC, the organization which filed the petition, was formed just under a year ago. An investigation by Willamette Week last year revealed that OMC was formed partly because of a divide in Oregon’s business community over how hard of stance to take against the agenda of the incipient Democratic majority.  

OMC was founded by veteran lobbyists who, according to documents reviewed by WW, worried that “the influence of Oregon’s public employee unions and significant out-of-state donors with extreme environmental agendas have pushed the majority Democrats further and further to the left.” 

 Labor unions nationwide had the wind knocked out of them last year, when the U.S. Supreme Court decided that union members who disagreed with their unions’ actions could choose not to pay dues, the primary source of funding for many unions. 

University of Oregon professor Gordon Lafer with the Labor Education Research Center told reporters he has seen the pattern of politicians backing away from labor unions and allowing business groups to dictate the terms of the labor debate multiple times. 

“The playbook is get the unions out of the way, then shrink the list of things that people can vote on,” Lafer says.  

Brown pushed for last week’s PERS reform bill which requires public employees make contributions into retirement for the first time. Even though it is a small portion of benefits, the move may damage both her relationship with public employee unions as well as the negotiating position of labor unions themselves.  

By Ian MacRonald