2020 OREGON PUBLIC FINANCE: BASIC FACTS

2020 OREGON

PUBLIC FINANCE:

BASIC FACTS

Research Report #1-20

LEGISLATIVE REVENUE

OFFICE



INDEX

Section

Pages

Subject

ii

LRO Organizational Chart

A

A1 ¨C A7

Overview

B

B1 - B3

Surplus Kicker

B3 - B4

Reserve Funds

B4 - B5

State Budget History

B6 - B7

Effect of Tax Changes

C

C1 ¨C C12

Personal Income Taxes

C13 - C24

Corporate Excise Taxes

D

D1 ¨C D11

Property Taxes

E

E1 ¨C E5

Property Tax Relief

F

F1 ¨C F5

Estate and Inheritance Tax

G

G1 ¨C G4

School Finance

G5 - G7

School Formula and ESD

G8 - G11

School Finance data and Tables

H

H1 ¨C H8

Transportation Taxes

I

I1 ¨C I7

Timber Taxes

J

J1 ¨C J4

Excise Cigarettes, Tobacco and

Alcohol (OLCC) Taxes

K

K1 ¨C K5

Lottery

L

L1 ¨C L3

Other taxes: 911 & Lodging

M

M1 ¨C M3

Recent Tax Votes

N

N1

O

O1 - O3

Recent Tax Votes

P

P1 - P2

Other Reports

Corporate Activity Tax

Sources: The data for the tables in this document come from a variety of sources. The

largest single source of data is the Oregon Department of Revenue. Other sources

include: The Departments of Education, Forestry, Transportation, Employment,

Consumer and Business Services, Administrative Services; the Oregon Lottery, the

Oregon Liquor Control Commission and a number of local governments.

LRO: 4/23/2020

i

Research Report #1-20

2020 Organizational Chart

Legislative Revenue Office

State Capitol Building

900 Court Street N.E., Room 160

Salem, OR 97301

503-986-1266



Senate Finance & Revenue

Chair

Senator Mark Hass

House Revenue Chair

Representative

Nancy Nathanson

LEGISLATIVE REVENUE OFFICER

Chris Allanach

Expertise: Tax Reform, Corporate Activity Tax, Kicker/

Reserve Funds, Revenue Forecast & Budget

503 986-1261

christopher.allanach@

Sr. Economist - Mazen Malik

Sr. Economist - Dae Baek

Expertise: Transportation, Bonds, Court Fees,

Tourism, Utilities, Local Finance, OLCC, Marijuana

Expertise: School Finance, Gambling, Employment &

Labor, Health & Insurance, Tobacco

503-986-1260

mazen.g.malik@

503 986-1265

dae.h.baek@

Economist ¨C Kyle Easton

Expertise: Personal Income Tax, Tax Credits, Housing

503-986-1267

kyle.easton@

Economist ¨C Jaime McGovern

Expertise: Property Tax, Natural Resources,

Estate Tax, Local Government, Utilities

503 986-1262

jaime.mcgovern@

Office Manager ¨C Corinne Gavette

Economist- Kaitlyn Harger

Expertise: Bill Process, Committee Scheduling,

General Office Issues, Supervise Session Staff, LRO

Budget, Staff Interim Committees

Expertise: Corporation Excise & Income

Taxes, Tobacco

503-986-1264

corinne.gavette@

503-986-1263

kaitlyn.harger@

Committee Assistant Sara Johnson

Senate Committee Business

503-986-1269

Committee Assistant Austin Anderson

House Committee Business

503-986-1268

Overview of Oregon¡¯s Revenue System

Comparative Analysis 1

The most comprehensive way to compare Oregon¡¯s current revenue system with other states is to

examine the most recent U.S. Census Bureau statistics on state and local government finance.

These data include all state and local revenue sources (and expenditures) collected on a consistent

basis from all states. The most recent data are for the 2017.

Census divides state and local revenue sources into six categories. These categories are:

? Taxes

? Revenue from the Federal Government

? Charges¡ªconsisting of direct payments for services from governments. The largest

components of this category are higher education (tuition & fees) and payments for healthhospital services.

? Miscellaneous Revenue¡ªthe largest component of this category is interest earnings on

government balances. Also included in this category are asset sales, system development

charges and net revenue from lottery.

? Government Enterprises¡ªconsisting of gross revenue from government operated

enterprises such as liquor sales and public utilities.

? Insurance Trust Revenue¡ªis made up of current revenue generated by public employee

retirement funds (mostly earnings on retirement funds), state operated workers¡¯

compensation funds and unemployment trust funds.

The Census combines all these sources to get total revenue for the state and local revenue system.

Insurance trust revenue and gross revenue from government enterprises are subtracted to get

general revenue. General revenue is a better gauge of revenue available for provision of public

services because most enterprise revenue goes back into the operation and trust revenue is for

specific future beneficiaries such as unemployed workers and public retirees. Finally, the Census

Bureau defines own-source revenue as general revenue minus transfers from the federal

government. This measure is the best overall reflection of the state and local government revenue

burden borne by the residents of a state.

Census data for Oregon¡¯s 2017 revenue categories can be found in Table 1. The information is

presented in a dollar per person format with Oregon¡¯s rank among the 50 states. A rank of 50 means

lowest per capita revenue.

On a total revenue basis, Oregon ranks 8th among the states. However, this measure includes

insurance trust revenue and gross government enterprise revenue, both of which are not generally

available for the provision of public goods and services. General revenue (excluding the insurance

trust and government enterprise categories), provides a better indication of revenue available to fund

public services in the current year. In this category, Oregon state and local governments received

$10,539 per person during 2017. Oregon ranked 12th among the states in this category. Own source

revenue (general revenue minus transfers from the federal government) totaled $7,940 per person

for a ranking of 17th.

1

This analysis is based on the available 2017 data and therefore does not include tax changes since that

time.

LRO 4/23/2020

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Table 1: All State and Local Government Revenue, Per Capita

$ Per Person

State Ranking

SUMMARY CATEGORIES

Total Revenue

General Revenue

Own-Source Revenue

$14,023

$10,539

$7,940

8

12

17

REVENUE SOURCES

Taxes

Federal

Charges

Miscellaneous

Government Enterprises

Insurance Trust Revenue

$4,731

$2,599

$2,284

$925

$544

$2,939

24

13

5

11

16

4

Table 1 also breaks down Oregon¡¯s revenue sources by category. Taxes comprise 45% of Oregon

general state and local revenue. Oregon state and local governments collected $4,731 per person

in taxes in 2017, an increase of 3.4% from the prior year. This ranked the state 24th in overall per

person tax burden. Oregon ranks 13th among the states with $2,599 in federal revenue (this category

does not include federal revenue going directly to individuals such as Social Security benefits).

Oregon is relatively dependent on charges for services, ranking 5th with $2,284 in per person

revenue. The charges category covers a large number of fees and charges for government services

at the state and local level. The largest are charges for hospitals (26% of total charges) and higher

education (21% of total charges). Oregon also ranks in the upper half of states in miscellaneous

revenue 11th. The state¡¯s extensive use of lottery revenue contributes to this ranking. Oregon ranks

4th in insurance trust revenue. The state¡¯s relative ranking tends to move up and down with changing

financial market conditions because Oregon¡¯s retirement funding system is highly dependent on

financial market returns.

Table 2 focuses on the taxes portion of the Oregon revenue system. Taxes play a particularly

important role in state and local revenue systems because they are the primary source of revenue

for general public goods such as education and public safety. Taxes also potentially have the largest

impact on economic activity because they represent a direct extraction of resources from the private

sector for use by the public sector.

Table 2: Oregon's Tax Revenue, Per Capita

$ Per Person

Total Taxes

Personal Income Tax

Corporate Income Tax

General Sales Tax*

Selective Sales Taxes

Property Tax

Other Taxes

$4,731

$2,021

$173

$0

$525

$1,487

$525

State Ranking

24

7

13

48

29

28

9

* Tied with 3 other states

LRO 4/23/2020

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