6.10.2019 City Council Work Session Minutes

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Council Discussion: • Councilor Syrett - said this motion addresses the burden on low-wage employees and she would not support exempting all employees making less than $25 an hour; said that this is a small amount of money to contribute to ensure that when 911 is called, someone will respond. • Councilor Clark- asked if non -profits are included in paying the tax; said his challenge with this amendment is that it gets less broad-based, which was supposed to be the rational for a payroll tax. • Councilor Zelenka - wanted to make sure he understood the amendment's different tiers for employees and that the employer rate would stay the same. • Councilor Semple - expressed support for this amended motion because it responds to community concerns about lowest -paid workers. • Councilor Taylor - asked for more information about how the rates would translate to dollars; said she will vote against this motion because, while it is an improvement, it is not enough. VOTE ON MOTION TO AMEND: PASSED 6:2, Councilors Taylor and Clark opposed. MOTION TO AMEND: Councilor Zelenka, seconded by Councilor Syrett, moved to 1. Amend subsection (1) of section 3.724 to increase the overall employer tax rate from 0.0020 to 0.0021 2. Add anew subsection (2) to section 3.724that states: 'Notwithstanding subsection (1) of this section, the tax rate imposed on the first $100,000 of wages paid by an employer with two or less employees is 0.0015" 3. Renumber subsections (2) through (6) of section 2.724 as subsections (3) through (7). and 4. Update the cross references in subsections (4), (5) and (7) of section 3.724 and in section 3.726. Council Discussion: • Councilor Zelenka - talked about his motion and his intention to address community concerns about sole proprietors by giving them a discount but not an exemption. • Councilor Taylor - shared concerns about employers not giving people raises because they will have to then pay more in taxes. • Councilor Clark- said that while he understood what this amendment is trying to accomplish, it may not work out the way it's intended. • Councilor Syrett -said she doesn't think there's a perfect way to get at the issue, but would prefer this approach exempting for the first $100,000 for businesses with one or two people versus exempting non -profits; expressed support for the amendment even if it may not get all of the relief intended. • Councilor Yeh - asked Councilor Zelenka to explain his rationale behind the amendment and why a sole proprietor making $100,000 would need a break • Councilor Zelenka - asked staff for the number of one- or two -person business within Eugene; explained that the amendment would give a break to sole proprietors making less than $100,000. • Councilor Clark- asked if "S" corporations pay both the employer and employee rate; asked about other situations where employers do business in Eugene but are not located in the city. MINUTES - Eugene City Council June 10, 2019 Page 4 Work Session