On May 13, the Portland Metro Chamber sent a letter to the Portland City Council to oppose any changes to the Portland Arts Education & Access Income Tax (Arts Tax) without first getting voter approval.
The Chamber believes that any attempt to implement such changes to the Arts Tax without voter approval would exceed the council’s lawful authority under the charter. The legal memo supporting this conclusion from Greenberg Traurig LLP and Peak Policy LLC, commissioned by the Chamber, is linked below for reference.
Importantly, the legal concerns identified in the memorandum are not limited to entirely new taxes but also apply to substantive changes to existing voter-approved taxes, including:
- Increasing tax rates
- Expanding the class of taxpayers
- Altering exemption thresholds
- Changing the structure or scope of the tax
- Repurposing or materially revising the voter-approved framework
The Chamber strongly supports the council’s intent to prioritize the cultural economy in this moment of long-term sustained economic decline. The business community recognizes that arts, events, cultural institutions, sports and entertainment will provide a bridge to a more vibrant future. However, the actions being considered are inconsistent with our city’s progressive values of transparency and collaboration.
Key Points:
- The Chamber supports arts funding in principle, but insists the process must respect the democratic framework under which the tax was originally approved.
- The council is considering amending, expanding, or restructuring the Arts Tax, which the Chamber says would be unlawful without voter referral.
- If the council proceeds with the tax increase, the Chamber is prepared to consider legal action on behalf of its members.
Additionally, we strongly urge this council to pursue other existing mechanisms to improve funding and support for the arts and cultural institutions in our community. As an alternative, the Chamber suggested redirecting the Motor Vehicle Rental Car Excise Tax, already paid by businesses to support arts and cultural venues, back to its original intended purpose instead of being absorbed into Multnomah County’s general fund. Redirecting this tax to its original intent provides increased investment in the arts and cultural economy without raising taxes.
We urge the Portland City Council to refer any changes of the Arts Tax to voters to instill public trust in government transparency and accountability.