Oregon Voters OK Tax Hike

      PORTLAND, Ore. (AP) - Oregon voters have approved two measures
raising taxes on businesses and the wealthy, averting budget cuts
legislators said would have meant larger classes in the schools and
less help for the poor and the elderly.
      Voters in Tuesday's special election approved Measure 66, which
raises rates on people earning well above six figures, and Measure
67, which increases business taxes.
      With 80 percent of the expected votes counted, both measures had
54 percent approval.
      The Oregon Legislature approved both tax increases last year,
and business groups sponsored a referendum drive to put them to a
statewide vote.
      The campaign pitted public employee unions warning of cuts in
schools and social services against many, though not all, of the
state's business groups, who said the taxes would cost a state with
11 percent unemployment even more jobs.
      The most recent reports had labor outspending business in one of
the state's most expensive issue campaigns.
      "We know now that Oregonians heard the message of what these
measures were about - supporting the most vulnerable," said Elana
Guiney, a spokeswoman for the pro-tax group Vote Yes for Oregon.
      The revenue from the new taxes, $727 million, is expected to
account for about 5.5 percent of the general fund in the next
two-year budget. Passage of the measures gives the state
Legislature a breather when it goes into a monthlong session
starting Monday.
      The returns reflected Oregon's political split, with Portland
and Multnomah County, a liberal bastion, supplying a large vote in
favor, while rural counties and especially those in Eastern Oregon
voting against.
      The results could give legislators in other states hints about
whether they can ask taxpayers for help in repairing ravaged
budgets.
      Approval of the two tax increases also ran counter to the
state's history of turning down tax increases.
      But Democrats who have commanding majorities in the Legislature
said they were careful to target the upper 2 percent of individual
taxpayers and the businesses with the biggest sales, many
headquartered out of state.