Arts tax deal: Mayor's $3M gamble to hire art teachers

Arts tax deal: Mayor's $3M gamble to hire art teachers
The deadline to pay the $35 Portland arts tax is Wednesday.

PORTLAND, Ore. – The Portland arts tax saga took another turn Monday, thanks to a gamble at City Hall.

Mayor Charlie Hales proposed a new deal that would allocate money to Portland schools for art teachers and programs before the next school year, despite the legal challenges to the Portland arts tax.

The tax, approved by Portland voters in 2012, funds arts education in public schools, but it was challenged by two lawsuits. If the city loses either suit, the money may have to be given back to taxpayers, many of whom have already paid the $35 annual tax.

The deadline to pay the arts tax is Wednesday, May 15.

The city was scheduled to distribute the estimated $6 million starting in November. Under the new deal proposed by Mayor Hales, the city would disburse half that amount from the pool already collected from taxpayers.

If the city loses the lawsuits and the $3 million has to be returned, the city would draw $1 million each from the following three resources to cover the bill:

  • The city’s contingency fund
  • Future budget appropriations to the Regional Arts and Culture Council (RACC)
  • The six city school districts (Portland Public Schools, Centennial, David Douglas, Parkrose, Reynolds and Riverdale

“The superintendents and I have been working to find a way to be true to the taxpayers, whose money this is, and to the voters, who approved the arts tax,” Hales said in a news release. “We think this does it.”

About two thirds of the $3 million will be earmarked for PPS. The other $1 million will go to the other five districts. Each district superintendent will decide how to spend the money.

"We are not in the business of telling superintendents how to run their districts,” Hales said. “These decisions have been tough to reach, but it’s been a combined effort all along, and we’re grateful to the arts community and our school districts for working with us to find a practical solution.”

Portland Public Schools Superintendent Carole Smith will recommend hiring an estimated 30 full-time arts teachers and spreading those 30 positions evenly across her district.

Hales' spokesman Dana Haynes said it’s fair to say the arts tax has not worked the way anybody wanted it to. He said the other $3 million, originally scheduled to be distributed next spring, is off the table until the lawsuits are resolved.

“If the lawsuits go against us and we can’t give out the tax money, everybody’s got some skin in the game,” Haynes said.

The tax has been revised twice since voters approved it last November. Earlier this year, a tax analysis showed anyone in a household above the federal poverty level was expected to pay the $35 annual tax, even if a person in the home made less than $35. The Portland City Council revised the tax to exclude people who made less than $1,000 in 2012.

Earlier this month, the mayor's office announced some people who paid the arts tax were eligible for refunds because they received most or all of their income from Social Security or the Public Employees Retirement System (PERS). Those types of income are not taxable by the city.

Hales said the tax money will primarily go to elementary schools.

“We want these students to have the benefit of the arts education that taxpayers have supported, and to do it in a financially responsible way,” Hales said. “In the end, getting teachers in our classrooms will pay dividends for generations to come.”