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Portland, Keizer eye cell-phone taxes

November 10, 2009

Portland & Keizer eyeballing additional telecom taxes without public vote
By Pac-Tech Alliance,

Both citing declining revenue from traditional wireline taxes the cities of Portland and Keizer have announced they are considering additional taxes on wireless telecommunications and other utilities without a public vote (even though voters have challenged or rejected similar increases in other Oregon municipalities).

In the city of Keizer, according to a staff report, a decline in franchise fees from local utilities, cable and telephone companies is a major reason the city council has begun work on a Master Telecom Ordinance.  They’ve also appropriated $10,000 for outside legal counsel’s help.

According to the staff report, fees from local telephone companies fell by over $40,000 in just two years.  The report suggests one possible solution; a registration fee on all telecom providers.  The city has acknowledged there may be some pushback on the issue, but according to Councilor Richard Walsh, “I’m in favor of this, but I think we should be aware…we’re starting a fight.” *

A similar situation is brewing in Portland; also citing a decline in wireline revenue, the city is considering new utility taxes to make up for the shortfall.  In a recent auditor’s report, staff noted that if wireless companies pay just a business license fee it will generate $250,000 for the city, BUT if the city was to levy a utility fee of 5% on gross revenue it will generate $11,500,000 (or 46 times the revenue) for the city.** The report notes that “the impact of this inequity is a loss of revenue to the city…”*** and has recommended that the city remedy the inequity and update cable communications and franchise management codes.  The report also acknowledges that in other Oregon cities similar proposals have faced a referendum and the proposal was either defeated or withdrawn, but still recommends Portland move forward.

* Keizer Times 9/22/09
** Utility & Franchise Revenue: Equitable tax and consistent approach needed to improve collections, Report from the City Auditor May 2009, page 14, figure 3
*** Utility & Franchise Revenue: Equitable tax and consistent approach needed to improve collections, Report from the City Auditor May 2009, page 15, paragraph 2

Portland Auditor’s report:
Keizer Times Story:

  
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Discuss this article

Dave November 10, 2009

Another tax? I thought Portland was just in the news this year or last for having a surplus. What is wrong, do they need more moeny for a soccer stadium they keep talking about? I bet you it is that.

qw November 10, 2009

Why don’t you tax ipods while you are at it.

cell phone jammers December 19, 2009

Thank you for this posting, you’ve got a few solid points but will you be posting a follow up to this?

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