On February 6th, the House Revenue Committee held a hearing on HB4010, our bill that would disconnect Oregon from federal Opportunity Zone tax provisions. The hearing flushed out the opposition unseen till now: investors and their proxies – economic development folks, real estate developers, lawyers and accountants. City economic development staff, as always, contended that without the ability to give away taxpayer money, they can’t attract development. Legislators are telling us that trickle-down advocates are calling and visiting them to lobby against the bill.

It’s time to show Senate and House members that you support HB4010 and do not want to continue to encourage more wealth disparity by allowing more tax schemes. As one legislator said: “It’s really simple: stop giving money to rich people.”

Take action

Call/email your legislators today

Legislators tell us they ignore cut-and-paste jobs, so we recommend any of these points in your own words:

  • The tax benefits go to the rich (7 percent of taxpayers have reportable capital gains).
  • Most investments will go to metro Portland or out of state, not Oregon’s towns.
  • Oregon’s investors can get tax reductions from the state even though they invest elsewhere.
  • Congressional estimates of the federal revenue loss have more than doubled since Opportunity Zones (O Zones) were enacted two years ago—and the latest estimate was released before Treasury issued its final “Come on in!” regulations in December. (Two years ago the Legislative Revenue Office estimated a loss to Oregon of $15.8 million in this biennium.)
  • Our research found that the big-ticket investments to date in Portland were underway before O Zones were designated meaning O Zones have not advanced any investments, dubious or otherwise.
  • O Zone investments are tax breaks on top of profits, because capital gains tax breaks have no value if an investor has no capital gains. On the flip side, the tax benefit cannot make a marginally profitable investment a good one, because investors will seek a sure bonanza elsewhere.
  • Thirteen states provide no state income-tax benefit for O Zones, either because they don’t conform to federal tax law (California, Mississippi, Massachusetts, North Carolina) or have no state income tax (among them Washington, Nevada, Texas and Florida).
  • HB4010 doesn’t affect the much larger federal tax benefit and therefore has a marginal effect on investment decisions—but has a large effect on Oregon’s treasury.

Emails matter. Chair Nathanson has not scheduled HB4010 for committee action; the floor would follow, quickly. Then it is over to the Senate, where we’ll have our hands full. Request a work session on HB4010.

A number of coalition members testified, balancing opposition from the investors’ advocates. A link to witness testimony, starting with our 14-minute presentation on behalf of the coalition, is here: House Committee On Revenue 2020-02-06 5:30 PM – Feb 6th, 2020