A two-percent countywide sales and tourism tax proposal took heat from a crowd of residents who packed the Hood River County Board of Commissioners’ meeting room Monday night.
More than 20 speakers weighed in on the concept, most condemning the tax. The overflow crowd spilled from the county building’s conference room into the hallway.
“No sales tax,” said red signs some attendees waved.
County officials called for the sales tax to avoid major service cuts amid a $1.6 million budget shortfall. The tax would be the first of its kind in Oregon, a state that has failed to pass a general sales tax for decades.
The tax aims to capture money from tourists, not only from goods but also services like event admission and recreational gear rentals. Groceries, medical items, and fuel would be exempt from the tax.
A survey estimated the program would raise about $3.5 million.
For the plan to move forward, the elected board needs to vote on whether to put the tax question on an upcoming election ballot — leaders are considering the May Primary election. Hood River County voters will have the final say on the measure’s passage.
Monday’s public hearing was the eighth meeting in which the county mulled over the tax, according to County Administrator Jeff Hecksel, but attendance was much higher Feb. 5.
Hecksel gave a rundown of the county’s financial straits. Neither of the county’s largest revenue sources — timber money and property taxes — have kept up with rising costs to run the government, he said.
Since 2006, timber revenue is down 36 percent. Property taxes cannot be raised above three percent due to state law — the county’s current rate is $1.41 per assessed $1,000, ninth lowest of Oregon’s counties.
The county has made cuts over the last decade, down on general fund employees by about 9 percent.
A county mailer says some possible eliminations discussed in the 2017-2018 budget cycle include core services like 24/7 sheriff’s deputy coverage and closing county parks.
Audience members sharply criticized the tax proposal, which many said would affect local residents and not just tourists.
The first speaker, Loran Ayles, said, “I think it’s the most ridiculous thing I’ve heard to come out of Hood River County. Hood River citizens do not want a sales tax — cut and dry.”
He asked the audience to raise their hands if they supported the tax, and less than five did.
“It’s a regressive tax,” David Phelps said. He felt it would hurt employees, retirees, and local businesses like Ace Hardware and Sheppard’s, that Phelps said don’t sell primarily to tourists.
Bart Vervloet said he thinks the measure will fail.
“I don’t like being sold a tax on an ‘us versus them’ theory, and it’s really easy to say this is a tourism tax — no, it’s not,” Vervloet said. “They’re here for (three or four) months … then for the other 80 percent of the year it’s on all of us.”
Caroline Park, co-owner of Thunder Island Brewing Co. in Cascade Locks, said the tax has a disproportionate effect on small businesses.
“The sale tax now becomes a deterrent for people to come and visit local businesses like mine and communities like mine,” Park said.
Many speakers acknowledged the financial difficulties the county faces but decried the tax. A few, however, voiced support.
Kate McBride, a Hood River City Council member, said she would vote for it. “If we don’t do this, what are we going to do?” she asked, to pay for services like health care and roads.
However, McBride suggested the board consider a lower tax rate or a narrower list of exemptions for it to be more “palatable.”
Commissioners said they had considered alternatives, but the sales tax was apparently the most viable way to combat the budget problems.
“We don’t feel good about it either,” Commissioner Les Perkins said.
Commissioner Bob Benton warned that the county will be entering its budget process next month and cuts could be coming.
“You will see those cuts within the next few months and what they look like, and what we’re prepared to do,” Benton said.
When an audience member questioned the statement, other commissioners said they will be entering the annual budget decision-making process.
Perkins said, “We’ve been through a decade of exploring options, we’re at the end of that road, we already know basically the things we can and can’t cut out of the budget.
“We know what we can cut and the list isn’t that long … it’s not being draconian, that’s just the reality we (have in) place.”
Benton said, “We would love more than anything else to not go down the road of a tax of any type.” He asked the community to give any suggestions they have.
Rivers said the county will pick a larger venue for the next hearing on the matter, Feb. 20.