Department of Justice Orders Release of Hidden Tax Subsidy Data, Clarifies Public Has Right to Know How Subsidy Dollars are Spent

OSPIRG

Salem– Yesterday, the Oregon Department of Justice ordered a state agency to release data about a major tax subsidy program estimated to cost Oregon taxpayers $322 million over the next two years, saying that there is a “strong public interest” in disclosing the information.
   
The order came after the agency, Business Oregon, denied a request by the Oregon State Public Interest Research Group (OSPIRG) to disclose information about the Strategic Investment Program, in which corporations receive a property tax break in exchange for a promise to create jobs and make specific investments in local communities. OSPIRG requested that Business Oregon disclose the recipients of these public dollars and what those recipients delivered in exchange for the money. OSPIRG filed a petition to the Attorney General last month to appeal Business Oregon’s decision. Business Oregon has seven days to either release the information or file suit to appeal the Attorney General’s decision.

“When a private company takes public dollars, the public has a right to know whether the company is holding up their end of the deal and creating jobs,” said Celeste Meiffren, Consumer and Taxpayer Advocate with OSPIRG. “The Justice Department has made it very clear that this is public information, so it’s time for state agencies to pull back the curtain.”

Since 2009, Oregon taxpayers have spent more than a billion dollars on corporate tax subsidies that are intended to create jobs and promote economic growth, while another $665 million is on tap to be spent in the next two years. Little information exists about whether these programs are delivering on their promise, despite a 2011 law intended to beef up disclosure of this spending on the Oregon Transparency Website.

Business Oregon and other state agencies have long justified suppression of this kind of data, arguing it is a ‘trade secret’ and is protected from disclosure under the public records law.

Yesterday’s public records order disagreed. The order states, “Regardless of whether that information may qualify as ‘trade secrets,’ we conclude that there is a strong public interest in its disclosure here… The incentives represent a sizeable public investment in that outcome, and the public has a correspondingly sizeable interest in ascertaining the extent to which its investment is paying off.”

OSPIRG is calling on Governor John Kitzhaber to step up the transparency of all corporate tax subsidy programs, noting that the transparency problems are not limited to the Strategic Investment Program. In a forthcoming report, the group will release findings showing that the available information on most corporate tax subsidy programs is inadequate to evaluate their effectiveness.

“Our Attorney General stood up for Oregon taxpayers yesterday,” said Meiffren. “It is up to Governor Kitzhaber to stand up for taxpayers today and in the future by instructing his agencies to show the public whether companies that get state or local tax incentives in exchange for jobs are doing just that.”

Read the full Public Records Petition Order here: https://www.ospirg.org/resources/orp/petition-public-records-disclosure-order