Summary: Measure 28's demise means cuts in services and keeps intact Oregonians' record of defeating tax proposals
Oregon voters on Tuesday rejected a three-year income tax increase, turning aside fears that schools, state police and the needy would be hurt by new budget cuts.
The defeat of Measure 28 underscored Oregonians' historic reluctance to approve new taxes of almost any kind. Although voters did agree to raise the cigarette tax last fall, they've never approved a general tax increase of any kind since they adopted the current income-tax system in 1930.
In the wake of the defeat, Republican legislators said they'd push to ease the impact of some of the harshest budget cuts, particularly to the mentally ill and the elderly.
But Gov. Ted Kulongoski opposes trying to rework the cuts, his spokeswoman Mary Ellen Glynn said Tuesday night.
Opponents, who were caught off guard by a rise in support for Measure 28 in recent weeks, were jubilant at its demise.
"This is more of a mandate than I thought we'd receive," said Russ Walker of Citizens for a Sound Economy, a pro-business group that opposed the measure. "It really says something about where people's priorities are. . . . They don't buy the line the state is hurting that bad."
Supporters said they took comfort that there was a relatively strong vote for the proposed tax increase -- at least compared with many previous tax measures that failed to capture even a third of the voters.
"We had great success getting this issue in the forefront," said Kris Kain, president of the Oregon Education Association, the teachers union. "I think it shows people really care about these issues. They disagree, but they really care."
Even before the vote, Kulongoski and legislators from both parties had met privately to talk about whether to move away from some of the scheduled cuts if Measure 28 failed.
House Speaker Karen Minnis, R-Wood Village, said she particularly wants to look at cuts to mental health care and senior citizen programs that "could absolutely put people out on the street."
And Rep. Dan Doyle, R-Salem, is working on a plan that would reduce cuts to the Oregon State Police.
Yet Glynn said Kulongoski thinks that "what's done is done" and that the Democratic governor did not want the Legislature bogged down in further debate about what to cut to make up for the failure of Measure 28.
"We need to face up to the fact that Oregon is in a recession," Kulongoski said in a statement, "and our tax structure is such that when the economy takes a downturn, state services take a hit."
The measure was winning in just four of the 36 counties. It was passing in heavily Democratic Multnomah County, but losing in suburban Clackamas and Washington counties. And the yes margin in Multnomah County was not strong enough to offset the big no vote in the rest of the state.
Although the defeat of the proposed tax increase followed a common pattern, the election itself was one of the most unusual in Oregon history.
In September, the Legislature referred the proposed three-year tax increase to voters after the recession caused a $2 billion dive in expected revenues for the state's 2001-03 budget.
In addition to the Measure 28 income tax increase, lawmakers raised cigarette taxes and delayed an income tax cut. They tapped reserves and used other one-time revenues for $963 million and cut agency budgets by more than $720 million.
The referral was a compromise between lawmakers who preferred to impose a temporary tax without sending it to voters and those who wanted to balance the budget with spending cuts.
In fact, many legislators who voted to refer the measure to the ballot did so expecting it to fail.
Outside the Legislature, the measure's chances were widely derided, but the state's public-employee unions decided they had a chance if they allied themselves with school and social service activists.
While opponents largely slumbered, the unions assembled platoons of volunteers who helped wage a campaign that largely flew under the radar. They avoided television, instead using extensive phone banking and carefully targeted radio ads.
State agencies, ordered to cut $310 million out of the last five months of the two-year budget cycle, came up with a series of reductions that further spurred the campaign.
For example, the Department of Human Services last month sent 63,000 notices to care providers and social-service recipients warning that they faced benefit reductions and cutoffs.
Critics complained that the cuts were more harmful than they needed to be, a charge denied by state officials who said they had already made millions of dollars in administrative cuts.
By mid-January, a statewide poll showed the measure dead-even in the polls -- the first time in at least two decades that support for a tax hike increased over the course of a campaign.
News that the race was close did spark some opposition advertising on radio. And opponents said the relatively heavy turnout for a special election -- it exceeded 60 percent -- showed that both sides were getting their voters to return their ballots.
"It takes a lot of pushing from proponents to get the tax measure up," said Portland pollster Tim Hibbitts, "and it doesn't take much for the opponents to push it back down."
