Relating to the authority of a political subdivision to impose income tax; prescribing an effective date.
Summary
HB 2110 limits how local governments in Oregon may impose taxes measured by net income. The bill requires any political subdivision that imposes an income tax to use the same statutory rules that apply under state law for determining net income, including apportionment and sourcing rules under ORS chapters 314, 316, and 317. It also exempts existing city business license taxes on net income that were already in effect and operative on January 1, 2025, and it applies to local tax ordinances not approved by voters before that date.
The bill also repeals ORS 268.505 and amends ORS 268.710 to remove a metropolitan service district’s authority to impose an income tax. In practical terms, this would narrow local taxing authority, especially for metro-level governments, and align future local income taxes more closely with state tax definitions and administration. The measure takes effect 91 days after adjournment sine die and applies broadly to ordinances imposing local taxes, subject to the stated grandfathering for certain existing city taxes.
Impact
HB 2110 would change Oregon law by preempting or standardizing local income tax rules, requiring local governments to follow state net-income determination provisions and eliminating a metropolitan service district’s separate income tax authority. It would amend ORS 268.710, repeal ORS 268.505, and create new provisions in ORS chapter 314 that affect political subdivisions imposing taxes on or measured by net income. The bill would also preserve certain preexisting city business license taxes on net income and limit application to local tax ordinances not approved by electors before January 1, 2025.
Sentiment
Based on the bill text and the absence of recorded committee testimony or votes, the available record suggests the measure is framed as a technical and structural tax-policy change rather than a broadly negotiated compromise. The bill’s language indicates a clear intent to constrain local taxing authority and create uniformity with state tax law. Because no committee discussion or voting history is provided, there is no documented public sentiment in the record beyond the bill’s formal policy direction.
Contention
The main point of contention is likely to be local taxing authority versus state control. Supporters would likely favor uniformity, predictability, and limits on local income-tax experimentation, while opponents—especially affected political subdivisions and metropolitan service districts—may object to the repeal of local authority and the restriction on future local income taxes. The grandfathering of existing city business license taxes suggests an effort to avoid disrupting current local revenue systems, but it also creates a distinction between existing and future local taxes that could be disputed.
Relating to the authority of the Wood County Central Hospital District of Wood County, Texas, to provide brain and memory care services to residents of the hospital district through the creation and operation of brain and memory health care services districts.