State Treasurer Tobias Read on Thursday issued a press release sharply criticizing the newly unveiled blueprint for a massive federal tax cut saying it would largely benefit the super-rich, while putting at risk key projects that benefit working families.
“In this misguided proposal, the super-rich win the most. And regular Oregonians lose,” said Read, who worries the economy suffers by consolidating more wealth among the super-rich at a time of acute income inequality.
Read said that to help finance the proposed tax cuts, the Congressional House Republican plan would limit federal deduction limits connected to state income taxes. Among Read’s comments:
“An analysis by Bloomberg Economics found that Oregonians would be among the hardest-hit by the tax plan, due to proposed caps on income and property tax deductibility.
“The tax cut blueprint also would eliminate access to tax-free bonds that are critical to financing affordable housing projects and other economic development programs to improve the quality of life for every Oregonian. Costs would climb for financing and refinancing infrastructure and public facilities at all levels of government.”
Reed’s office oversees public bonding in the state, and he stated that nonprofit-financed projects for hospitals, cultural, social service, and education facilities would also become less viable.
The treasurer said problems with the tax-cut blueprint are a stark illustration about the need for an open discussion about improving America’s tax system, adding, “When will Congress learn that complex fiscal policy cannot be crafted behind closed doors, without the involvement of leaders at the state level?”
Also under the plan, governments would lose the ability to refinance tax-exempt debt into less expensive tax-exempt bonds, which would increase pressure on taxpayers. In addition, the proposal limits the ability of state agencies to sell bonds that improve quality of life or facilitate economic development, which would increase interest costs.
“The House proposal would functionally eliminate the Oregon Facilities Authority, a successful state agency that helps nonprofits statewide, build vital projects with the help of low-cost, tax-exempt financing,” Read stated. “During the past 27 years, the authority has helped to facilitate more than $3.7 billion in bonds for projects across the state, including $2 billion for healthcare facilities, $1.3 billion in education facilities and $350 million to improve and expand affordable housing stock. The tax-cut blueprint also would threaten the continued viability of the State’s efforts to increase the supply of new, affordable multi-family housing under the ‘LIFT’ program, which provides gap funding for housing projects around the state.”
Read said he will work with the Oregon Congressional delegation as well as treasurer and comptroller counterparts in other states to highlight the need to maintain access to tax-exempt financing, which reduces the cost of infrastructure that benefits the public.