by Rep. Knute Buehler and Dino Vendetti
Bend and Central Oregon are growing. With easy access to all forms of outdoor recreation, good local schools, expanding higher-education opportunities at the OSU-Cascades campus and direct-flight connections to key cities, Bend and Central Oregon have emerged from the Great Recession as an economic and lifestyle destination for a diverse community of entrepreneurs, dreamers and doers.
But Ballot Measure 97 — the $6 billion tax on corporate sales — is a direct threat to the progress and opportunities being created in the region.
By now, perhaps you’ve heard the major problems with Ballot Measure 97. First, it raises a whopping $6 billion every two years — a 30 percent increase in the state budget with no plans, controls or guarantees on how this huge influx of new revenue will be spent by the governor or Salem politicians. Second, it’s a highly regressive new tax, with no exemptions for food, medicine or monthly utilities. The tax will hit seniors on fixed incomes and middle/lower-income families particularly hard. And third, an independent analysis estimates the tax will cost more than 38,000 private-sector jobs over the next six years.
In all states that levy a personal income tax, more than 80 percent of the tax base is derived from personal, not corporate, tax. Oregon is no exception. Therefore, driving companies away and/or eliminating private-sector jobs that generate tax revenues is no way to strengthen communities and grow the tax base. For these reasons alone, voters should reject Measure 97.
Oregon doesn’t exist in isolation. As the U. S. and world economies grow more interconnected each day, Oregon now has 49 other state competitors for talent and capital. Technology has made it possible for workers in a knowledge-based economy to live nearly anywhere. Bend is now seen as one of the nation’s leading entrepreneurial cities making a successful transition from a natural resource to knowledge-based local economy.
In a knowledge-based economy, people are the most valuable assets and investment for businesses. And unlike a factory, people can easily move — to here and away from here. Tax policies, like Measure 97, will influence whether companies and people choose to locate here in the first place, or worse, relocate to a more tax-friendly environment. Measure 97 will hit startup companies particularly hard, since startups frequently have large gross receipts but little profit for many years. Measure 97 taxes receipts — not profits.
Oregon must invest more in K-12, higher education and the other critical infrastructure needed to thoughtfully manage growth. But Measure 97 isn’t the solution. Over the long term, it will actually weaken the economic foundation of our state.
Here in Bend, we’re enjoying the benefits — and challenges — that come with being a desirable place to live, work and play. According to Bruce Cleveland, founder of Bend Polytechnic Academy, “We are focused on providing Oregon students with the skills in high demand by industry. Workers with these skills will attract companies to start in or relocate to Bend and Central Oregon, especially technology companies whose employees value community, education, family and the environment. These companies and workers will provide a stable and large tax base we need to support our schools, seniors and other critical infrastructure projects.” Kollective is an example of a tech company that recently relocated from the San Francisco Bay Area to Bend and hired a BendPoly graduate.
Let’s not jeopardize our progress by passing a risky, extreme new tax.
Rep. Knute Buehler represents Bend (House District 54) in the Oregon Legislature. Dino Vendetti is the founding General Partner at Seven Peaks Ventures, located in Bend.