Ballot Measure 85 changes the “corporate kicker” provision of the Oregon Constitution. Under current law, certain excess corporate income and excise tax revenues collected during a biennium are returned to corporate taxpayers. Under Ballot Measure 85, the excess revenues would be retained in the state’s General Fund and used to provide additional funding for kindergarten through twelfth grade public education. The Legislature has full discretion over how it allocates General Fund moneys, including the total amount of General Fund moneys to kindergarten through twelfth grade public education.

The Oregon Constitution describes how the “corporate kicker” process works. First, at the beginning of each biennium the Governor estimates tax revenues that will be received by the state’s General Fund during the biennium. Estimated revenues from corporate income and excise taxes are determined
separate from other General Fund revenues. The General Fund is where most individual and corporate income tax revenues are deposited. The General Fund pays for state services, including schools, prisons and social services. The biennium is the two-year period for which the state budget is prepared. The biennium runs from July 1 of each odd-numbered year to June 30 of the next odd-numbered year.

Second, at the end of each biennium budget, the Governor determines the revenues actually received by the General Fund. Again, revenues received from corporate income and excise taxes are determined separately from other General Fund revenues.

Finally, if revenues actually received by the General Fund from corporate income and excise taxes are at least two percent greater than what was estimated, the excess currently are returned, or “kicked back,” to the corporate income and excise taxpayers.

Ballot Measure 85 amends the Oregon Constitution to provide the “corporate kicker” be retained in the General Fund and used to provide additional funding for public education, kindergarten through twelfth grade. The excess revenues would no longer be returned to the corporate income and excise
taxpayers. The Legislature has full discretion over how it allocates General Fund moneys, including the total amount of General Fund moneys to kindergarten through twelfth grade public education.

The Oregon Constitution contains “kicker” provisions for both corporate income and excise taxpayers and personal income taxpayers. Ballot Measure 85 does not affect the “kicker” for personal income taxpayers.

Result of "Yes" Vote: "Yes" vote allocates the corporate income and excise tax "kicker" refund to the General Fund to provide additional funding for K through 12 public education.

Result of "No" Vote: "No" vote retains existing corporate income and excise tax "kicker" that requires refund to corporations when revenue exceeds estimated collections by two percent or more.