Novick and Hales.jpg

Portland Commissioner Steve Novick, right, and Portland Mayor Charlie Hales, earlier this year, at Portland City Hall.

(Beth Nakamura/The Oregonian)

UPDATED: This story was updated with reaction from the Portland Business Alliance

Portland Commissioner Steve Novick said the city is considering more changes to a proposed personal income tax for road repairs and safety projects, including scrapping the "compromise" version of the tax and returning to a controversial option tabled earlier this year.

"We have a choice to make," Novick said Wednesday at a City Council meeting.

The commissioner said the Transportation Bureau, which he oversees, is considering returning to a so-called user fee proposal ditched in June after public outcry, or submitting another version of the progressive income tax.

"We have not, at this point, resolved which direction we are going to go," Novick said.

Wednesday's announcement means a final vote on the Portland Street Fund was delayed again. It's now set for Jan. 14. The City Council is considering a rare evening meeting on or around Jan. 7 for public comment.

The development marks the latest twist in the street funding saga that Novick and Mayor Charlie Hales started in February with a series of town halls.

In May, they presented a $53 million plan that included a fee on businesses based on the number of trips generated to their doors. They pulled that plan in the face of public criticism about a lack of equity for low-income residents and small businesses.

In November, Hales and Novick debuted a new proposal that would raise $46 million a year through a progressive income tax on residents -- capped at $900 a year for the wealthiest Portlanders -- and a fee on businesses based on square footage, revenue and employees.

But the same powerful forces that torpedoed the May proposal came out against the new plan. The Portland Business Alliance, saying it couldn't support a progressive income tax, vowed to send the proposal to voters.

Novick said the latest plan was a "compromise" that he hoped some would embrace and others would accept. City officials hoped, Novick said, an income tax would allay PBA concerns and satisfy Portlanders concerned about equity.

Under the new plan, the 45 percent of Portlanders on the low end of the income scale wouldn't pay anything.

But while advocates of low-income residents gave support, the PBA didn't. Novick said Wednesday that the PBA and its allies "would rather burn the city to the ground" than approve anything resembling a progressive income tax.

Sandra McDonough, PBA president and CEO, said she's "puzzled" by the latest news out of City Hall. "We haven't been throwing flames," McDonough said in reaction to Novick's comments, "we've been trying to sit at the table." She said the chamber was never alone in its criticism of the income tax.

The City Council held a public hearing on the new plan and modified it to limit the impact on home-based businesses. Novick said the city is done changing the business portion.

A final plan should be publicly available Dec. 31.

— Andrew Theen