ELECTION 2016: Portland, Ore., voters approve 10-cent gas tax increase

By Keith Goble, Land Line state legislative editor | 5/18/2016

By a razor thin margin, voters in the city of Portland, Ore., on Tuesday approved a 10-cent per gallon tax on local gasoline sales. The city now has the distinction as having the highest local gas rate in the state.

Ballot Measure 26-173 was approved with a 51 percent margin.

The vote follows a city council decision a week ago to impose a new tax on trucks. The nearly 3 percent local heavy vehicle use tax is a companion to the gas tax increase.

The taxes collected on cars and trucks are as billed as helping the city address a road repair backlog estimated at between $100 million and $200 million over the next decade.

A 10-cent gas tax rate increase is estimated to raise $16 million annually. The tax will be collected locally through 2020.

The additional revenue from the city-level tax, however, will not be used solely for road projects. About 56 percent, or $9 million, will be applied to pavement work. The other 44 percent, or $7 million, will pay for projects that include bike lanes, sidewalks and crosswalks.

Opponents said the city would be better served to make sure all existing revenues are being used appropriately before enacting new revenue measures. Another complaint is that the ballot question does not put enough money into roads.

Supporters said putting money into pedestrian improvements could have a higher economic return for the city than pavement maintenance. They cite the city’s use of biking, walking and public transit as delivering economic returns.

The truck tax is a companion of the gas tax effort. Businesses paying the Oregon weight-mile tax will be subject to the city’s new heavy-vehicle use tax for the next four years.

According to estimates, the 2.8 percent truck tax rate increase will raise $2.5 million each year. Revenue will be used for street work and safety projects.

The truck tax is scheduled to take effect this September.

Elsewhere, voters in the Oregon communities of Reedsport and Sandy also decided on local fuel tax rate increases.

The ballot in Reedsport included a question on a seasonal tax to benefit the city’s levee system and streets. By a 54-46 percent margin, voters approved the 3-cent tax on gas and diesel purchases in the Douglas County locale. The tax will be collected May through October.

Advocates said the six-month term will generate the greatest amount of revenue from people traveling through the area.

The tax is expected to raise $100,000 annually.

In Sandy, 71 percent of voters turned back a 3-cent increase to the local fuel tax rate to pay for road work. The Clackamas County community already collects 2 cents on each gallon of gas and diesel sold.

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