Revenue
Legislative Report - Week of 6/16
Revenue Team
Coordinator: Peggy Lynch
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Natalie Briggs
Please see Governance Overview here.
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Revenue Updates
Revenue Updates
By Natalie Briggs
By Natalie Briggs
HB 2321
Oregon House Bill 2321 seeks to study Oregon’s property tax system, with a focus on Ballot Measures 5 and 50. Ballot measure 5, passed in 1990, set limits on property taxes through a hybrid levy- and rate-based system originally intended to control rapidly increasing property tax costs. This was a departure from the previous property tax system, which relied on tax levies set by each district as a function of specific budget needs. Measure 50, passed in 1997, modified the system further by implementing permanent rates, reducing assessed value, and limiting annual property tax increases. Critics of measures 5 and 50 argue these changes to property tax policy in Oregon have resulted in inequitable taxation over time, with tax burdens shifting from high value to low value properties. Critics also argue these measures have imposed budget constraints on Oregon cities, requiring communities to rely on local levies instead. House bill 2321 and its amendments seek to generate a tax system review, with a focus on inequities and options to modernize Oregon’s tax system. Testimony provided during the June 5 work session on house bill 2321 was largely supportive.
House Bill 3962 (introduced as HB 3962-14) changes local transient lodging tax regulations in Oregon by expanding how funds can be used. Since 2003, Oregon law has required 70% of new or increased transient lodging taxes to be spent on tourism, with 30% reserved for local discretionary spending. HB 3962 expands the use of restricted funds to allow spending on infrastructure and tourism-impacted services such as public safety services, and is widely supported by voters as a means to sustain city services. Amendment -14 adjusts revenue allocation, requiring that a minimum of 40% of net revenue from transient lodging taxes go toward funding tourism promotion or tourism-related facilities, with no more than 60% to be used on city or county services. HB 3962-14 will become operative on January 1, 2026.