Anti-Tax Campaign Reports $250,000 Contribution—From an Oil Company That May Be Exempt From the Tax

Check from Equilon LLC highlights big stakes, inconsistency in proposed $3 billion tax hike.

By Nigel Jaquiss

The group Defeat the Tax on Oregon Sales has disclosed a $250,000 contribution from Houston-based Equilon LLC, the refining and marketing affiliate of Shell Oil.

Beyond the obvious fact that big oil is very interested in Oregon's tax picture, there are a couple of interesting aspects to the contribution.

First, it's the biggest check yet disclosed by the group fighting against Measure 97, the proposed $3 billion-a-year tax increase on corporations with Oregon sales of more than $25 million (the previous biggest check, $217,000, also came from an oil company, Phillips 66).

The Equilon check brings the total raised by opponents of the tax to $5.4 million, of which they have $3.7 million on hand.

The second interesting aspect of the contribution is Equilon's legal structure: the letters "LLC" mean it's organized as a limited liability company, a different legal structure than a corporation.

That highlights what critics have said is one of the inconsistencies of Measure 97—the tax increase only applies to so-called "C Corporations" (typically, large companies) and not to LLCs, S corporations, partnerships or other companies.

In the research report on Measure 97 it released yesterday, the City Club of Portland highlighted this issue, saying it could have the effect of treating similar companies differently.

“Measure 97 taxes only C corps, although many LLCs, B corps and S corps
compete in the same sectors with similar levels of revenue,” the report said. “Many large businesses are LLCs and S corps, and they often compete with C corps in similar sectors. For example, Fred Meyer (Kroger) and Safeway grocery store chains are C corps and would pay the tax. New Seasons Market, a B corporation, and Alberstons, a limited liability corporation (LLC), would not pay it.”

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