08/17/1992 Meeting - Laserfiche WebLink

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e In response to Ms. Bascom's comments, Mr. Nicholson said it would be too bad if the council sacrificed important principles to make the strategy palatable for the public. The motion failed, 6:2. Responding to a question from Mr. Miller, City Manager Mike Gleason estimated that it would take staff 20 to 30 days to describe the service mix identified by the council. Mr. Boles moved, seconded by Mr. Green, to tentatively accept the core proposal as designed. The motion passed, 8:0. The council discussed funding strategies for the core package ($3.8 million). Mr. MacDonald proposed that the council retain the mix of corporate and personal income tax to support the core proposal. Mr. Rutan said he generally supported Mr. MacDonald's suggestion, but raised the possibility of refining the package by substituting a business and occupation tax (B & 0 tax). He said the tax would provide the broadest possible base as it encompassed partnerships, sub-s corporations, as well as C corporations and individuals. Mr. Mounts described the Multnomah County business tax and the Portland B & 0 tax. Mr. Boles asked how public sector employees would be addressed under the B & 0 e tax. Mr. Mounts said that those employees would be excluded from the collec- tion pool. Ms. Ehrman asked how much more would be realized from a B & 0 tax as opposed to a corporate income tax. Mr. Mounts estimated that an additional $900,000 would be collected at a rate of one percent. It would require 1.6 percent to realize $3.8 million. Mr. Boles asked if a B & 0 tax would affect professional corporations. Mr. Mounts said yes. Mr. Boles asked if there was a difference in the efficiency of collection, administration, and implementation between a B & 0 versus the mix of taxes the council has considered. Mr. Mounts said he had not analyzed the concept thoroughly, but pointed out that the administrative costs for business would be less than for a personal income tax due to the number of filers. In addition, the personal income tax requires monthly turnovers for withholding. He estimated that there were 5,000 entities affected by the B & o tax in Eugene as opposed to 75,000 persons affected by a personal income tax. The council briefly discussed with Mr. Mounts how a B & 0 tax would work and the rates necessary to support the core proposal. Mr. Rutan moved, seconded by Mr. Nicholson, to appoint council- ors to serve as a revenue task force for the purpose of analyz- e MINUTES--City Council Work Session August 17, 1992 Page 10 5:30 p.m.