Local government in Oregon is predominantly financed by the property tax, although there are other local taxes, such as hotel/motel ​taxes, transit taxes and, in Multnomah County, a business income tax. 

Most local governments must prepare and adopt an annual budget. This includes schools, counties, cities, ports, rural fire protection districts, water districts, urban renewal agencies and special districts. Oregon’s Local Budget Law establishes standard budget procedures and requires citizen participation in budget preparation and public disclosure of the budget before it is formally adopted. A budget officer must be appointed and a budget committee formed. The budget officer prepares a draft budget, and the budget committee reviews and revises it before it is approved. Notices are then published, copies of the budget are made available for public review, and at least two opportunities for public comment are provided. 

Local government budgets are usually for a fiscal year beginning July 1 and ending June 30. However, local governments have the option of creating a two-year biennial budget like the state. The governing body must enact a resolution or an ordinance to formally adopt the budget, make appropriations, and levy and categorize any tax. This must be done no later than June 30. Budget revenues are divided into ensuing year property tax and non-property tax revenues. 

The Oregon Constitution allows a local government to levy annually the amount that would be raised by its permanent rate limit without further authorization from the voters. When a local government has to increase the permanent rate limit, or when the rate limit does not provide enough revenue to meet estimated expenditures, the government may request a local option levy from the voters. Approval requires a "double majority." This means that at least 50% of registered voters must vote, and a majority of those who vote must approve the levy, unless the measure is submitted during an election held in any May or November, which are exempt from the “double majority” approval requirement.