Portland To Vote On $2.5 Billion Homeless Aid Tax Amid COVID Economy

As the COVID-19 pandemic continues to bring the economy to a screeching halt, progressive cities dealing with a large and growing homeless populations face increased pressure to provide assistance amid budget shortfalls and dwindling or delayed tax revenues.

“Businesses and households are racking up huge amounts of debt. You have people who aren’t paying their rent and who are delaying their mortgages,” according to Eric Fruits, a research director at the Cascade Policy Institute.

Given this backdrop, voters in Portland, Oregon will decide on Tuesday to approve taxes on personal income and business profits which would raise $2.5 billion over a decade for the city’s homelessness initiatives, according to KATU.

The ballot measure was planned before the pandemic reduced the U.S. economy to tatters. Proponents, including many business leaders and major institutions, argue the taxes are needed now more than ever in a region that has long been overwhelmed by its homeless problem.

How voters in the liberal city react amid the pandemic will be instructive for other West Coast cities struggling to address burgeoning homeless populations as other sources of revenue dry up. The measure is believed to be one of the first nationwide to ask voters to open their wallets in a post-COVID-19 world. –KATU

Instead of housing, the money would be spent on so-called “wrap around services” to help with rent assistance, job training, mental health and substance abuse treatment, and case management and outreach.

“I think it’s really going to give you a sense about how concerned are people, still, about homelessness as an issue — and what are they willing to pay in to solve that issue,” said Marisa Zapata, head of the Homelessness Research & Action Collaborative (HRAC) at Portland State University. 

“We know government budgets are going to be eviscerated, so what does this mean for additional revenue-raising opportunities?” she added. “Who could we turn to to bear some of that responsibility and how will voters react?”

According to HRAC, there are approximately 40,000 people in the greater Portland area who have experienced at least one period of homelessness, and 105,000 households which face housing insecurity.

Those who oppose the $2.5 billion bill are shocked that organizers continue to push the effort while the economy is stalled and much of Oregon’s population remains under lockdown.

“People are frustrated. They’re out of work, they’re angry and the last thing they’re thinking about right now is raising taxes,” according to Amanda Dalton, legislative director of the Northwest Grocery Association.

Voters in the three counties that make up the greater Portland metro region will be asked to consider a 1% marginal income tax on the wealthiest residents and a 1% tax on gross profits for the region’s biggest businesses.

The measure would apply to individual filers with a taxable income of more than $125,000 or joint filers with taxable income of more than $200,000. Joint filers making $215,000 a year, for example, would be taxed 1% on $15,000, or $150 a year. –KATU

Approximately 90% of Portland residents and 94% of businesses will be exempt from the tax, says Angela Martin, campaign director for HereTogether – the organization which created the measure.

Supporting the bill is the Portland Business Alliance, whose members have repeatedly cited homelessness as a ‘critical factor affecting its ability to expand and recruit,’ according to the report. Also backing the measure are the Portland Trail Blazers and other major sports franchises, as well as several local government leaders.

Last week Gov. Kate Brown asked all state agencies to find a way to cut nearly 20% of their budgets, while the city of Portland is expecting a $75 million drop in revenue.