This study examines the effects of the 1979 Oregon Property Tax Relief Plan on 1980-81 school district budget decisions by comparing the available tax relief, the school expenditures, and the tax levies in the state for the years 1975-81. The history of direct and indirect property tax relief in Oregon is sketched for the years prior to 1979; the authors also trace the growth of the state's Basic School Support Fund and the pressures for substantial direct tax relief during a period of surplus in Oregon's general funds. In the midst of dwindling state resources, however, most Oregon school districts studied here (enrolling 83 percent of all students) were found to have increased their tax levies and current expenditures per pupil in 1980-81, the year after the state's direct tax relief program began. It was found that local districts had applied the 1979 tax relief measure almost exclusively to increasing school support rather than to lowering property taxes. But the authors note that indirect tax relief in the form of general state aid to schools (a plan viable in Oregon for only 1 year), provided property tax reduction with a moderate increase in school spending. (JW)