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The hearing is set for Dec. 8 on a proposed city payroll tax intended to help balance the city’s general fund budget. Interim city councilor for Ward 5, Andrew Buck, also took the oath of office and joined the council in its discussion on the tax.
The Springfield City Council will hold a public hearing on a proposed payroll tax, elected officials agreed during a work session on Monday, Oct. 27.
The hearing is scheduled for Dec. 8, said Nathan Bell, the city’s finance director.
“That would give us a chance to hear more directly from the public, discuss, finalize and at the end of that meeting, we wouldn’t be implementing the payroll tax,” Mayor Sean VanGordon said during the meeting. “We would be directing the staff to start that work. So we would be working on implementing all through the next year.”
If the council decides to move forward with the payroll tax, it would be implemented by a council-adopted ordinance rather than a decision by voters.
The council previously agreed to proceed with a tax rate of 0.1% shared by employees and employers. The proposal states it would apply to employers located within Springfield city limits and be paid on gross wages before deductions. For an employee earning $50,000 annually, the tax would be $50 per year, matched by the employer.
Plans call for the tax to go into effect Jan. 1, 2027. Bell said that if the council moves forward with an ordinance, it would need to be ready for adoption in February or March to be ready for implementation by January 2027.
The payroll tax is expected to have a net revenue of $2.9 million the first full fiscal year. Bell said if the proposed tax rate were increased to 0.11% it would net an additional $400,000, which Councilor Alan Stout noted could be applied “to plug a hole in our library funding.”
VanGordon convened a 12-person task force earlier this year to review the city’s finances and recommend ways to balance the general fund. The committee suggested a payroll tax, as well as reducing the library budget by $500,000 and increasing the rate for its police and fire levies, among other long-term suggestions.
The payroll tax is intended to help balance Springfield’s general fund, which is the city’s main operating fund. Finance leaders forecast the general fund will have a shortfall of $3.5 million in fiscal year 2027 and $4.8 million in fiscal year 2028 before taking into account the task force recommendations, according to a general fund five-year forecast. Limited property tax growth, a decline in timber revenue and recent inflation are driving the deficit.
With the task force suggestions applied to the general fund, those shortfalls drop to $1.5 million in fiscal year 2027 and $390,000 in fiscal year 2028.
“I look at this forecast and those task force recommendations; it doesn’t solve all of our problems,” Bell said. “I don’t think the idea is to give us this blank check. It still requires us to have a sharp pencil and kind of tighten our belt, but it is something we actually can work with while we start to implement other things, such as economic development initiatives.”
Springfield’s general fund supports police, fire and emergency medical services, administrative services (which includes human resources, finance, IT, the city manager’s office and the city attorney’s office), municipal court, development and public works, and the library.
Business community reaction
Bell said city staff have been talking with members of Springfield’s business community about the proposed payroll tax.
“Generally, I would describe people as still curious,” VanGordon said. “You know, obviously they understand the technical issue that we’re facing … (They) may not be super-thrilled with additional taxes from a competitive perspective, but there was definitely a lot of appreciation with how transparent we were being about this challenge.”
The mayor said members of the business community requested the tax be simple to execute and that the structure stay consistent for the first three years.
The proposed payroll tax does not have tiered rates, in contrast to Eugene’s community safety payroll tax, which exempts employees making minimum wage.
Springfield’s plans call for guardrails for the tax, including that there be no rate increases or structural changes for the first three years, with a review process after year three. Plans also call for annual reporting on how the money is being used.
Interim councilor sworn in
Before the work session on Monday, Ward 5 Springfield City Councilor Andrew Buck took the oath of office. He then took his seat with the other councilors.
Buck, 45, will serve as an interim member of the City Council through December 2026. He replaces Victoria Doyle, who resigned in August after serving since January 2023.
The seat will be on the May 2026 primary election ballot, and Buck has said he plans to run. The councilor selected in May, or at a runoff election in November, will begin serving a four-year term January 2027.
