Earlier this month owners of local lodging establishments attacked Clatsop County's proposal to boost room taxes to cover the increased costs of the proposed new county jail.

On Wednesday, it was the turn of another industry to criticize a tax aimed at them.

Several local restaurant owners and their supporters urged the county board of commissioners to abandon a proposed tax on eating establishments, calling it an unfair and burdensome fee that would drive away business.

The board discussed the jail funding issue in a work session but took no action. Public hearings are scheduled for Aug. 14 and 28 on both the bond for the $16.7 million jail itself and the restaurant tax proposal.

The county is facing a short deadline to decide whether to seek voter approval for the new 140-bed jail in this November's election, and to choose how to pay for the estimated $850,000 increase in operating costs of the new facility. The filing deadline for the November ballot is Sept. 5.

The restaurant tax proposal was floated after the board's discussion on the room tax increase July 3. Staff were directed to draft a proposed restaurant tax ordinance for review.

The ordinance, based on a similar program in place in Ashland, where a 5 percent tax pays for sewer system improvements and parks, would impose a 2 percent tax on sales of food in restaurants, mobile outfits like espresso stands and food sold for immediate consumption in grocery stores. Alcohol sales would be exempt, as would such outlets as school and hospital cafeterias and temporary food stands.

But for those who spoke to the board, the entire proposal was too hard to swallow.

"If you wanted the most unfair tax, you found it," said Pig 'N Pancake owner Bob Poole.

Aside from what they said was the unfairness of targeting one industry - one with already low profit margins - many restaurateurs warned the board about the message the county would send by implementing such a tax, especially to the out-of-state visitors who appreciate the fact local businesses charge no sales tax.

"We couldn't buy that much anti-tourism advertising if we tried," said Dooger's owner Doug Wiese. "This is one huge black eye for Clatsop County."

With the county already hurting from media coverage of traffic tie-ups and Spring Break rowdiness, local businesses hardly need the additional bad publicity that the restaurant tax discussion would bring, said Jeff Ter Har. Just the word that the county is considering such a tax will be taken by many people out of the area to mean that the tax is already in place, he said.

"We need positive press, not more negative press," he said. "End this fiasco tonight."

John Riesterer said three-quarters of his customers are local residents. Paying the county tax would mean cutting back on donations to local causes, advertising and other expenses, he said.

Others questioned the cost of administering the tax, including the periodic audits that go along with it.

Portway and Labor Temple owner Bob Heilman said his and other restaurant employees will be among the first hurt by such a tax.

"When a person sees a sales tax on a bill, their tip is reduced," he said. "It's an immediate negative reaction."

More than 40 restaurant owners attended an organizational meeting Tuesday to discuss the tax proposal, and "we will grow," Heilman said.

Commission Chairman Sam Patrick said after the meeting that the board will wait to hear more testimony at the two public hearings next month before deciding on the tax proposal. But with the election filing deadline in early September, he sees few other options available to the county for a source of jail operating funds if the board rejects the restaurant tax.

"It would be difficult to do something else," he said. "We would have to decide by (Aug.) 14th."

One commissioner said he's already made up his mind. Bob Green told the audience he's opposed to the restaurant tax, and said he'll continue to push for the county to instead use its share of state timber revenue to cover the additional operating expenses.

Some speakers Wednesday suggested a bond levy to pay for the added operational costs. Commissioner Tim Gannaway noted that property tax limitation measures would prevent the county from charging the tax on all county taxpayers.

The county is studying alternative funding options like the restaurant tax and room tax to meet the added operational costs of the new jail. After cutting about $1 million from this year's budget, county officials say there isn't enough money in the existing budget to cover the extra $850,000.

Staff originally proposed a 2 percent increase in local room taxes to raise the needed funds. That option came under fire from motel owners at a board meeting July 3, and at the end of the meeting, the board directed staff to investigate a restaurant tax instead.

The estimated cost of the jail itself has been reduced. Consultant Richard Langford of Heery International spoke briefly on updated design and cost calculations the company developed for the project, and said almost $2 million has been shaved from the total price tag. Thanks to the separate development of the proposed community corrections transition center, the jail can be somewhat smaller, and the overall price reduced from about $18.5 million to $16.7 million.

Heery originally developed the jail plans in 2000 when the county first considered seeking voter approval for the project.

About $2.8 million of the jail's cost would be covered by the Rural Law Enforcement District and the Special Projects Fund - the rest would be paid for by a bond measure.

The board directed staff to continue researching ways to further reduce both the building cost and the operational expense of the new facility.

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