The Eugene City Council voted unanimously tonight to have a committee bring back more information on possibly referring a progressive city income tax to save local schools for the May ballot.

The council didn’t take a formal vote clarifying exactly where they stand. But about half the council or more appeared to favor the income tax over a restaurant tax, after several restaurant owners testified that a restaurant tax would unfairly target businesses already struggling to stay afloat in the recession. About half the council or more also appeared to favor attempting to meet a mid February deadline for referring a measure to the May ballot.

The 4J and Bethel school superintendents said they would discuss with their elected boards whether they should delay possible school construction bond measures for May to avoid competing with the city effort to fund actual teaching.

4J Superintendent George Russell said he hoped the city tax could raise $10 million a year for his district, which is facing huge classes and a four-day school week due to dramatic cuts. Bethel also faces proportionally big deficits.

A progressive, graduated city income tax with rates set at 0.5 percent for income (AGI) $50,000 to $99,999, 1 percent for $100,000 to $249,999, and 1.5 percent for incomes more than $249,999 would generate roughly $40 million per year. That’s based on an EW analysis of state tax data that assumes Eugene has a similar income distribution to Lane County and generates about 63 percent of the Adjusted Gross Income in the county.

If the graduated tax were limited to incomes above $70,000, the tax would impact roughly 20 percent of taxpayers and generate roughly $22 million a year. A graduated tax above $100,000 would impact roughly 10 percent and generate roughly $19 million a year.

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