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Opponents of income tax increase seem assured of vote

BY DAVE HOGAN
11/26/2003
by DAVE HOGAN on 11/26/03.

SALEM -- Opponents of the Legislature's $800 million income tax increase gave elections officials 13 boxes of petition sheets Tuesday that they said contained more than 147,000 signatures -- nearly three times the number they need to put the issue on a special ballot.

Petitioners and tax increase supporters agreed that the signature total virtually guarantees a Feb. 3 referendum in which voters will decide whether to overturn the temporary tax increase that lawmakers used to help balance the state budget.

Signature gatherers said voters' anger about the increase eased collection of the signatures and makes them confident that voters will reject it.

"We have confirmed through this process that the citizens of our state are outraged by what the Legislature has done," said Russ Walker of Citizens for a Sound Economy, one of the groups spearheading the referendum campaign.

Using three orange handcarts, Walker and others wheeled the boxes of signature sheets into the state Elections Division less than two hours before the 5 p.m. deadline. Elections officials have until Dec. 9 to determine whether the petitioners have the required 50,420 valid signatures. They started sorting the signatures Tuesday night.

If the referendum qualifies for the ballot, it will set up a vote on one of the key pieces of revenue for the state's $11.5 billion general fund budget for 2003-05, which the Legislature balanced in late August at the end of a record-long session. Legislators agreed to the increase after tax revenues, driven down by the recession, failed to meet projections.

The vote would come a little more than a year after voters, by 54 percent to 46 percent, rejected a temporary income tax increase designed to prevent $310 million in cuts to schools and state programs.

Supporters of the latest increase say they will emphasize the services financed with the income tax money. That includes schools, health care, senior citizen services and courts, said Morgan Allen of Our Oregon Coalition, which backs the increase.

"We feel this brings stability to services that Oregonians care about," Allen said.

The coalition includes public employee unions, senior citizen groups, disabilities organizations, parent-teacher associations and Oregon Food Banks, he said. Their campaign on the referendum will be similar to the effort for Measure 28, the January tax increase proposal that failed. That campaign emphasized the services that would be cut if the measure failed.

But opponents of the $800 million plan say taxpayers want state government to limit spending, be more efficient, and look to new sources of revenue such as selling timber from state-owned forests, rather than raising taxes. That is particularly true, they say, while Oregon's economy struggles and unemployment ranks among the nation's highest.

"These petitions represent the voice of the taxpayers, who are tired of increasing taxes and afraid of losing their job, not making their house payment and not being able to put food on the table," said Jason Williams of the Taxpayers Association of Oregon.

Allen acknowledged that the election would be "a tough decision" for voters.

Walker said opponents of the tax increase, who have raised about $600,000 for the campaign, include the Oregon Family Council and the state Republican, Libertarian and Constitution parties.

In the referendum election, a yes vote would uphold the tax increase and a no vote would nullify it. If the law is upheld, a three-year income tax surcharge would be enacted. The bill to a taxpayer would be a percentage of the tax they owe and would increase with income, ranging from 1 percent to 9 percent.

The surcharge was contained in House Bill 2152, which also included a phase-out of medical deduction for middle- and high-income senior citizens, an increase in the corporate minimum tax and other business taxes, and a property tax increase. The bill would raise as much as $1.1 billion overall for the 2003-05 and 2005-07 budgets.

The petitioners said they collected signatures in all 36 Oregon counties and that more than 70,000 -- close to half -- were gathered in Multnomah, Clackamas and Washington counties. Walker estimated that about 25,000 of the statewide total were collected by paid signature gatherers. The rest came from volunteers.

The one issue no one was debating Tuesday was whether the referendum would have enough valid signatures to trigger the election.

Last year, 11 initiatives submitted signatures to try to make the November ballot. By checking for duplicates and examining voter signatures and other records, elections officials found that 65 percent to 73 percent of the signatures were valid.

At those verification rates, the referendum campaign would need to turn in 70,000 to 80,000 signatures to wind up with enough valid ones.

"With the amount of signatures they've turned in, I think it would probably be foolish to say they're not going to qualify," said Allen of the Our Oregon Coalition. "We've got a real fight on our hands."

Dave Hogan: 503-221-8531, davehogan@news.oregonian.com