The Portland Metro Chamber heightened tensions during a challenging budget season by submitting a research paper to the Portland City Council and Mayor Keith Wilson, arguing that the council does not have the authority to increase taxes without voter approval.
This email, which serves as a clear warning against potential tax hikes, arrives as several progressive council members are proposing various tax increases.
These proposals include raising the corporate tax rate for the Portland Clean Energy Fund and increasing taxes on large CEO salaries.
The Metro Chamber, which represents many of Portland’s biggest businesses, opposes these tax proposals, arguing that any tax increase would lead to the exit of companies and high earners from the city.
“We are providing this to you as a service, and to transparently communicate the basis for the Chamber’s firm position that the city council must refer any new or increased taxes to voters,” stated Jon Isaacs, the chamber’s executive vice president of public affairs.
The policy paper, commissioned by the chamber and crafted by consultants Jeff Newgard and Nikki Dobay from Peak Advocacy and Policy Consulting and Greenberg Traurig, asserts that the City Council lacks legal authority to raise existing city taxes.
According to the consultants, the only way to increase current taxes is through a ballot measure voted on by the public.
The research paper addresses a central question: Can the City Council impose or expand tax obligations without seeking voter authorization first?
The paper concludes that the council cannot.
The legal framework, supported by constitutional principles and case law, makes this clear, according to Newgard and Dobay.
They caution that various taxes adopted by the city over the past decade were created with little regard for the legal constraints set by the city’s charter.
This, they argue, exposes the city to escalating litigation risks, constitutional challenges, and substantial financial liabilities.
The consultants emphasize that the city’s charter does not grant it a broad power to tax.
They reference a ruling from the Oregon Supreme Court over a century ago, which determined that the charter did not provide the “power of taxation at large.”
This conclusion remains a controlling precedent and indicates a clear boundary: unless voters specifically authorize a tax, the City Council does not have the authority to impose or expand it.
In his email to council members, Isaacs did not explicitly state that the Metro Chamber would pursue legal action if taxes were increased by the council.
However, he made it evident that the paper represents the chamber’s position and suggests that legal challenges could arise should the council choose to raise taxes.
The paper claims that as the city considers passing further tax increases, including proposals to increase the CES and CEO Pay Ratio tax, additional lawsuits are likely to occur.
This points to potential legal risks associated with the push for new taxes.
Isaacs declined to disclose the amount spent by the chamber on the research paper.
In his communication to Wilson and councilors, Isaacs clarified that the chamber does not plan to take legal action against past taxes approved without a ballot measure, even though they believe these taxes were raised without authority under the charter.
City Councilor Steve Novick dismissed the chamber’s claims, referring to the paper as a joke.
He pointed out that Oregon Revised Statutes 221.410(1) states, “Except as limited by express provision or necessary implication of general law, a city may take all action necessary or convenient for the government of its local affairs.”
Novick argued that the power to tax is a fundamental aspect of any government.
Additionally, he criticized the chamber’s claim that it would not challenge past tax increases, pointing out that while they won’t, they are inciting others to bring lawsuits that could threaten the city budget.
Councilor Angelita Morillo echoed Novick’s sentiments, stating, “It’s always illuminating to see corporate interests investing in policy interpretation when it suits their bottom line.”
She affirmed that she would follow the City Attorney’s advice rather than that of consultants hired by an organization consistently opposed to holding corporations accountable for their fair share.
The Metro Chamber has historically played a significant role in City Hall, and it became more active earlier this spring when councilors began discussing tax increases.
Recently, after a council vote on a budget amendment to redirect $2 million in new funding for the Police Bureau to support cuts in outdoor park maintenance, the Metro Chamber declared that it would only back an increased Parks Levy if the council restored the $2 million in police funding.
Currently, it remains uncertain if any councilors will propose an amendment by June 11, the date by which the council must vote on the final budget, to replace the $2 million that Mayor Wilson allocated to the Police Bureau in the upcoming fiscal year.
The Metro Chamber appears to have identified Councilor Steve Novick as a potential intermediary for such a compromise.
Novick initially brought up the chamber’s threat during a city meeting on May 28, explaining that the chamber indicated it would support an increased Parks Levy only if the Police Bureau’s budget proposal was left intact.
This suggestion was met with dissatisfaction from some more progressive council members, who felt that the chamber should not exert such pressure to influence council decisions that cater to the business community.
During the council meeting, Councilor Angelita Morillo remarked that she hoped one “measly call” with the chamber would not sway Novick.
Recent polling shows that voter support for doubling the current Parks Levy is precarious at best.
An opposition campaign, such as one possibly organized by the Metro Chamber, could significantly hinder support for the measure at the ballot box.
In the absence of opposition, polling indicates that support for doubling the levy stands in the low 50 percentage points, which is a concerning starting point for any measure.
image source from：https://www.wweek.com/news/city/2025/06/05/portland-metro-chamber-to-city-council-you-dont-have-authority-to-raise-taxes/
