Oregon’s state constitution says revenue from taxes on motor vehicle fuel — “any tax levied on, with respect to, or measured by the … sale … of motor vehicle fuel” — shall be used exclusively for construction, repair, and maintenance of public highways, roads, streets and roadside rest areas. Measure 97, a proposed statute on the November ballot, doesn’t create a motor vehicle fuel tax. Technically it increases the corporate minimum income tax, but it calculates the minimum tax based on 2.5 percent of a corporation’s total annual in-state sales over $25 million. So what happens when the sales in question are sales of motor vehicle fuel, like with Chevron, Shell and the other gas companies?
The Measure 97 campaign says it would still be considered a corporate minimum income tax, not a motor vehicle tax in that case. And the measure itself is very clear that all the revenue it generates is to provide additional funding to public early childhood and K-12 education, healthcare, and services for senior citizens — not roads.
But State Senator Brian Boquist (R-Dallas) asked the Legislative Counsel to look into the Constitutional question, and on Aug. 30, the Legislature’s lawyers issued an opinion: To the extent the tax is calculated based on motor fuel, those monies — estimated at $250 million a year — would have to be spent on roads. The legal opinion is non-binding, and ultimately it could be for the courts to decide.
But State Senator Michael Dembrow (D-Portland), said $250 million would make a pretty good start on a robust transportation funding bill.
“From my perspective, that’s not a bad place to be putting some money,” says Dembrow. “Certainly it’s a top business priority for us to be investing in.”