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PORTLAND, Ore. (KATU) — The Portland City Council is set to consider a major overhaul of the city’s arts tax today to make the tax less regressive and more accountable.
The reforms are co-sponsored by Council President Jamie Dunphy and Councilors Elana Pirtle-Guiney and Tiffany Koyama-Lane and will be considered as part of the council’s regular agenda.
Voters approved the Arts Education and Access Tax in 2012 as a $35 per-person flat income tax intended to fund elementary public school arts teachers and nonprofit arts organizations, with services targeted to youth and underserved communities.
Under the current structure, the tax applies as a flat $35 on individuals living in Portland, and anyone making more than $1,000 in gross taxable income is required to file.
Low-income individuals making under $1,000 per year are not required to file. Individuals making over $1,000 but living in families under the Federal Poverty Level must proactively file to document poverty status to qualify for an exemption, but they do not have to pay.
The changes would relieve about 44% of current tax filers of the burden of filing, while maintaining stable revenue for the fund. Under the proposal, 56% of current filers would pay an additional $15 annually, a 43% increase from the current $35 tax.
“It is shocking how incredibly low some folks are just living out there. And the reality is that the collections on this has never met the expectations of what we would do because we are going after people who make as little as $1,000 a year,” said Council President Jamie Dunphy.
The ordinance also includes changes aimed at accountability and alignment with the original voter-approved measure, following city audits in 2019 and 2026 that called for changes to the tax and its funded programs to ensure commitments made to voters were delivered.
One major change would also be to the way people file. Currently, every individual must file separately, even if they are married. Under the proposal, filing would shift to a more standard system—similar to regular taxes—with categories like single and joint filing. That means couples could file together instead of submitting separate forms.
Among other changes, the proposal would direct that 95% of Arts Education and Access Tax revenues be dedicated to Portland K-12 students and/or underserved communities, and that 5% be distributed through grants and sponsorships to nonprofit organizations and schools providing arts programs and experiences specifically serving those same populations.
It would add a requirement that schools document any year-over-year underspending of funds received, including reasons for underspending and plans for using any ending fund balances.
One proposed change would shift the filing requirement from the current system where every individual must file separately to standard single/joint/other filings. The proposal would also raise the filing threshold to $20,000 in Oregon Taxable Income for single filers and $40,000 in Oregon Taxable Income for joint filers.
The councilors introducing this ordinance, Council President Jamie Dunphy, Councilor Tiffany Koyama Lane, and Councilor Elana Pirtle-Guiney say the current system is unfair, difficult to navigate, and financially unstable—and that the new plan would address those issues.
Tax rate may change
The proposal also addresses the tax rate itself.
The arts tax remains $35, the same amount set in 2012, and supporters say it has lost value because it has not been adjusted for inflation. In the 2025-2026 fiscal year, losses triggered 44% cuts to arts organizations. Without changes, cuts to arts educators in public schools may be triggered as early as the 2030-2031 fiscal year.
Under the proposed reforms, the rate would increase from $35 to $50 for those above the income threshold, which sponsors say would match inflation since 2012 and restore the tax’s original value.
The rate and filing threshold would then be indexed to inflation beginning in the 2027-2028 fiscal year, a change supporters say would stabilize revenue.
The reforms also include what sponsors describe as built-in accountability measures, including stronger reporting and clearer standards intended to ensure arts tax funds support students, classrooms and underserved communities.
City documents also describe community involvement efforts that included regular constituent events, public media appearances soliciting input, and outreach with groups and individuals representing school districts, arts educators, teaching artists, small and community-based arts organizations, and large arts institutions.
The ordinance has been under development for more than a year with stakeholder engagement including Portland arts organizations of varying sizes, Portland Public Schools and members of the Oversight Committee.
Past developments
Some of the issues already on the radar for city councilors include strategies to improve ease of collecting tax payment, such as a postcard with a QR code and existing integration with digital tax platforms, and clarification that those efforts are separate from other policy changes in the ordinance.
City documents also acknowledge that the tax remains regressive, with interest in exploring a tiered structure based on income levels in the future, and concerns about increased tax burden on lower-income individuals who remain subject to the tax.
Public testimony in committee included 12 people who provided verbal testimony at the April 28 meeting and five people who submitted written testimony prior to committee action.
A common theme was concern over the tax being burdensome; suggestions such as automatic low-income exemptions, reduced penalties and a more income-linked structure; concerns about insufficient revenue and financial strain on arts organizations; interest in changes to oversight and implementation; and debate over whether changes should be decided by a public vote rather than council action.
Testimony also included perspectives supporting elimination of the tax and shifting responsibility to state funding for schools and voluntary donations for nonprofit support, alongside comments emphasizing arts access as a core component of education and community life.
Community members are welcome to testify on the reform at the May 6 meeting. The meeting begins at 2 p.m., and the arts tax reforms are the second item on the regular agenda.
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