ORS 221.450¹
Privilege tax on public utilities operating without franchise

Except as provided in ORS 221.655 (Privilege tax on distribution utilities), the city council or other governing body of every incorporated city may levy and collect a privilege tax from Oregon Community Power and from every electric cooperative, people’s utility district, privately owned public utility, telecommunications carrier as defined in ORS 133.721 (Definitions for ORS 41.910 and 133.721 to 133.739) or heating company. The privilege tax may be collected only if the entity is operating for a period of 30 days within the city without a franchise from the city and actually using the streets, alleys or highways, or all of them, in such city for other than travel on such streets or highways. The privilege tax shall be for the use of those public streets, alleys or highways, or all of them, in such city in an amount not exceeding five percent of the gross revenues of the cooperative, utility, district or company currently earned within the boundary of the city. However, the gross revenues earned in interstate commerce or on the business of the United States Government shall be exempt from the provisions of this section. The privilege tax authorized in this section shall be for each year, or part of each year, such utility, cooperative, district or company, or Oregon Community Power, operates without a franchise. [Amended by 1987 c.245 §3; 1987 c.447 §115; 1989 c.999 §§7,8; 1999 c.865 §30; 1999 c.1093 §7; 2007 c.807 §41]

Notes of Decisions

Read with ORS 221.420 (Municipal regulation of public utilities), under home rule analysis, where city ordinance charging franchise fee is not specifically preempted by state law, city has authority to enact and enforce ordinance. Rogue Valley Sewer Services v. City of Phoenix, 262 Or App 183, 329 P3d 1 (2014), aff’d 357 Or 437, 353 P3d 581 (2015)

“Privilege tax” as used in this sec­tion encompasses license fee es­tab­lished by respondent city where that fee is intended to raise revenue to fund city-wide services such as police and fire depart­ments. Northwest Natural Gas Co. v. City of Gresham, 359 Or 309, 374 P3d 829 (2016)

“Franchise” as used in this sec­tion means negotiated agree­ment between city and utility that func­tions as contract, and does not mean city licensing scheme that involves unilateral imposi­tion of fees. Northwest Natural Gas Co. v. City of Gresham, 359 Or 309, 374 P3d 829 (2016)

1 Legislative Counsel Committee, CHAPTER 221—Organization and Government of Cities, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors221.­html (2019) (last ac­cessed May 16, 2020).
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2019, Chapter 221, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano221.­html (2019) (last ac­cessed May 16, 2020).
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent. Currency Information