Item 4: Ordinance on City Income Tax for Schools

Home Browse Search

ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Public Hearing: An Ordinance Concerning a Four-Year Income Tax for Schools; Adding Sections 2.2000 to 2.2038 to the Eugene Code, 1971; and Providing a Sunset Date Meeting Date: April 11, 2011 Agenda Item Number: 4 Department: Central Services Staff Contact: Sue Cutsogeorge www.eugene-or.gov Contact Telephone Number: 541-682-5589 ISSUE STATEMENT The council will hold a public hearing to receive testimony on an ordinance implementing a four-year City income tax for schools. Action on the ordinance is scheduled for April 25. BACKGROUND On February 14, 2011, the council approved Resolution #5023 referring to the May 17 ballot an income tax measure for schools. On February 22, 2011, the council adjusted the tax brackets and rates for the measure in Resolution #5024. After an appeal, the ballot title was certified on March 15, and was assigned Measure #20-182, Temporary City Income Tax for Schools. This ordinance, along with administrative rules that would be adopted by the City Manager, would implement the provisions of Ballot Measure #20-182. The proposed ordinance is included in Attachment A. If Measure #20-182 is passed, administrative rules would be developed and then adopted after a public notice and comment period. Ordinance Provisions The following discussion highlights the major provisions contained in the draft ordinance included in Attachment A. Effective Date and Sunset: The ordinance states that it would become effective only if Measure #20- 182 passes and that the tax would be in effect for tax years 2011, 2012, 2013 and 2014. In addition, the ordinance provides that the tax provisions would sunset after returns are filed for the 2014 tax year. (Section 1, 2.2002, and Section 3.) Tax Rates and Brackets, Dates and Other Requirements: The ordinance provides more detail about how the tax rates and brackets will work. It includes rates and brackets for single and joint filers, and provides that residents with the same Oregon Taxable Income should pay the same tax rate, even if some of their income is exempt from Eugene taxation under Oregon Revised Statutes. It also sets out who is required to file a return, how part-year residents will have their income prorated, a provision for taxpayers to file for an extension, and a tie to changes in federal and state tax returns. (2.2010 through 2.2018) Definitions: The ordinance includes definitions for items such as “resident” and “Eugene taxable income.” (2.2004) \\Cesrv500\cc support\CMO\2011 Council Agendas\M110411\S1104114.doc