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Brown talks with groups, but not negotiating alternate to union-backed tax plan

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TRIBUNE FILE PHOTO - Gov. Kate Brown says she is not trying to negotiate an alternative to a proposed gross receipt tax that could be on the ballot in November.SALEM — Gov. Kate Brown is not trying to negotiate an alternative to a union-backed corporate tax ballot measure, despite meeting with interests on various sides of the divisive proposal.

Those talks are not negotiations for an alternative to the corporate tax measure, a spokeswoman for Brown said Wednesday, Jan. 20. The proposed ballot measure would tax certain Oregon businesses with sales greater than $25 million.

Lawmakers in the state Senate have said they would prefer to work out a compromise bill to raise tax revenue, in order to avoid a bitter political fight between labor and business interests ahead of the November election. Unions and business groups appear ready to settle the issue at the ballot box, and statements by Brown and her administration suggest the governor does not plan to take the lead on the issue.

“As she has said previously, Oregon needs stable and adequate revenue for schools, and Gov. Brown continues to gather information and talk with a variety of stakeholders about the proposed measure,” Brown’s communications director, Kristen Grainger, wrote in an email Wednesday. “But these conversations are not negotiations.”

Brown said during a press conference Wednesday that she still had not reached a conclusion on the proposal.

News reports about Brown’s meetings with business leaders and others regarding the tax measure left some people with the impression the governor was trying to work toward a revenue bill that would serve as an alternative to the measure known as initiative petition, or IP 28.

The initiative, sponsored by the union-backed group Our Oregon, would raise an additional $2.65 billion annually for the state, according to economists in the Legislative Revenue Office. It would do so by charging corporations a 2.5 percent tax on sales above $25 million.

Although the measure specifies the tax revenue could only be spent on education, healthcare and services for senior citizens, it could help the state deal with financial challenges including an anticipated shortfall in the state’s Medicaid budget and an $18 billion unfunded liability in the state pension fund over the next 20 years.

“I don’t think there’s absolutely any question that we need additional revenue to make sure we have adequate funding for our schools,” Brown said during the press conference. “We have just invested significantly in early childhood education and removing barriers for Oregon students to be able to attend Oregon schools. In order to continue maintaining these levels of programs we need additional revenue. I have in my 24 years in public service ... tackled a number of issues, and sometimes issues are not so easy as they seem, and I would argue this is one of them. I have met with folks on both sides of this issue, and I have not yet reached a conclusion on IP 28.”

Brown, who is running for election in November, has received support from labor unions including a $100,000 campaign contribution from the national arm of the American Federation of State, County and Municipal Employees earlier this month. The donation was the largest the governor has reported for this campaign cycle, according to an analysis of state campaign finance data.

“I am pretty confident that the governor would consult working people, chief petitioners, if she were pulling together negotiations,” Ben Unger, executive director of Our Oregon and a chief petitioner on the tax initiative, said.

If Brown does attempt to negotiate a deal, the Legislature might have to schedule a special session. Grainger wrote in an email that “no action on a gross receipts tax is contemplated for the 30-day session in February.”

The Capital Bureau is a collaboration between Pamplin Media Group and EO Media Group. Hillary Borrud can be reached at 503-364-4431 or This email address is being protected from spambots. You need JavaScript enabled to view it.. Paris Achen can be reached at 503-385-4899 or This email address is being protected from spambots. You need JavaScript enabled to view it..