Sponsors propose severance tax to replace most harvest tax; public testimony split over small owners and REITs

Representative Mark Gamba and Senator Jeff Golden presented House Bill 3,489 and its dash-1 amendment at a public hearing of the House Committee on Revenue on April 24, proposing to replace most of the existing forest products harvest tax with a value-based severance tax targeted at large timberland REITs and similar owners.

Representative Gamba said the goal is to have large, out‑of‑state real estate investment trusts "start helping us pay for the wildfire services they benefit from," and argued the state has been paying wildfire costs from the general fund while REITs generally pay little or no Oregon corporate income tax. He described the dash-1 amendment as structured so that "the little guy will not see any extra burden and that the large timber REITs will suddenly start pitching in for the state's wildfire costs." He also stated the amendment "will not cut funding for OFRI. We are holding it harmless." (Representative Mark Gamba, sponsor)

Senator Jeff Golden said the bill would restore a severance tax generally at a 5% rate on the value of timber sales above 25,000 board feet per year and reiterated that the bill's nonrefundable tax credit would allow companies that already pay Oregon income tax to offset much or all of their severance tax liability. "If…