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Gov. Brown remains silent on corporate tax hike

She outlines her economic priorities at Westside Economic Alliance breakfast.

TRIBUNE PHOTO: PETER WONG - Gov. Kate Brown talks with Mari Watanabe, executive director of Partners in Diversity under Portland Business Alliance, after Westside Economic Alliance breakfast Wednesday, June 22, at Embassy Suites in Tigard.Gov. Kate Brown drew more attention Wednesday (June 22) for what she did not say to Washington County business leaders and public officials as for what she did say.

Brown did not say how she stands on a ballot measure, which has qualified for a statewide vote Nov. 8, that will raise corporate taxes based on Oregon sales.

“We respectfully urge you to stand with business and community leaders in opposition,” said Tom Brian, former Washington County board chairman and state representative, at the close of Brown’s remarks at a Westside Economic Alliance breakfast.

Like virtually all business groups, WEA opposes the initiative backed by public-employee unions — which are also among major supporters of the Democratic chief executive.

After the breakfast, however, Brown’s official spokeswoman said the governor would have a response — but that any details would have to come from the governor’s campaign staff, not her office staff.

“An announcement regarding her position on this or any ballot measure or candidate will need to be announced by her campaign,” Kristen Grainger said in a statement.

Brian also said alliance members are unlikely to disagree with Brown’s call for more state aid to education programs, more attention to problems faced by small businesses, and a major funding plan for roads and transportation projects.

The pending ballot measure would raise Oregon’s corporate minimum tax on businesses with Oregon sales exceeding $25 million annually. The rate would be 2.5 percent on sales exceeding $25 million. According to the Legislative Revenue Office, it would raise about $6 billion every two-year state budget cycle — money that advocates say would represent a fairer share from businesses to support schools and state services.

“But it makes Oregon even more reliant and more exposed to the volatility of income taxes,” Brian said. “Whether local or state, tax policy by petition rarely has served us well.”

Brown has said that should it pass, she has a plan for implementation that would cushion some of its negative effects.

In Brown’s response issued by Grainger: “With one of the strongest state economies in the nation, Governor Brown is working to sustain that economic growth statewide as well as address the need for adequate and stable revenue for education and other critical services.

“Over the past 30 years, no Oregon governor or legislature has been able to do both, so she continues to consult leaders in business, such as the WEA breakfast this morning, as well as education and human services about the potential benefits and challenges across the state if IP-28 passes or fails to pass. She will take a position when that consultation process is completed.”

Brian also called on the governor to appoint a task force to review Oregon’s tax system, which relies on income taxes for schools and state services and property taxes for local services.

In Brown’s response issued by Grainger: “She is certainly open to ideas other leaders may present for achieving stable and adequate funding for education and other services for Oregonians.”

Brown is up for election Nov. 8 for the two years remaining in the term of predecessor John Kitzhaber, who resigned under pressure in February 2015 just 38 days into his fourth term.

Brown and Brian were in the Oregon Legislature together during the 1990s — though Brian switched to the Republican Party after 1991 — until Brian was elected in 1998 to the first of three terms as the nonpartisan Washington County chairman. Brian left office in 2010. Brown was elected in 2008 as secretary of state, first in line of succession to the governor.

What she did say

During her remarks at the WEA breakfast at the Embassy Suites in Tigard, Brown focused on three issues that she said would maintain Oregon as the “picture of economic health,” according to Bloomberg’s recent economic evaluation of states that rated Oregon as the most improved in 2015.

“State government does not create jobs,” she said. “But we can lay the groundwork to make sure our economy continues to thrive… It’s one of my priorities to create an Oregon that thrives in every single corner of the state.”

Oregon’s unemployment rate has reached a modern-day low of 4.7 percent. But other areas have lagged behind economic growth in the metro area.

Brown pledged to work for greater state support of education at all levels, including early childhood programs, career training, science and technical education, and college affordability.

Though Oregon lawmakers doubled state aid to career training and science education to $35 million in the 2015 session, Brown said, Washington state spent $400 million that same year.

“I am working now to identify stable funding to get those programs into every single school across this state,” she said.

Brian’s response: “There is very little disagreement in this room for support of our education system.”

Brown also said she has a panel looking at ways to refine regulations and provide incentives for Oregon’s small businesses, which create an estimated 70 percent of new Oregon jobs. The panel is scheduled to come up with recommendations in the fall.

“We want to make sure that all of our businesses are focused on creating black ink, instead of wasting their time on navigating red tape,” she said.

Transportation plan

Brown said she plans to build on the work of a transportation panel, which she inherited from Kitzhaber, that called in a May report for reducing metro-area traffic congestion, shoring up roads and bridges to withstand a severe earthquake, and modernize the system.

Brown mentioned a recent report that said congestion will mire Portland area drivers in 52 more hours of traffic annually.

“As a lawyer, that’s a lot of billable hours,” she said.

On a recent shopping trip to Washington Square in Tigard, Brown said, it took her two hours on a Friday to return to Salem, where the governor’s official residence is. Without traffic, the drive is normally under an hour.

Brown said she is working with the Oregon Transportation Commission and others to develop her own proposal for presentation to the Legislature, which already has a joint committee at work for the 2017 session. The committee met June 13 in Portland and has scheduled a hearing Sept. 19 in Hillsboro.

Lawmakers approved major funding plans in 2003 and 2009, mostly by raising vehicle registration and driver licensing fees – and in 2009, increasing the state gasoline tax for the first time since 1993. Under Oregon law, however, the money is reserved for road and bridge work.

“These revenues do not begin to meet the real and increased needs of our multimodal transportation system,” Brian said in his response.

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Adds comments by Brown's official spokeswoman after the breakfast; corrects estimate as projected by the Legislative Revenue Office in a May report.