Scott Swanson
Should Oregon extend option levies up to 10 years?
Should the state constitution be revised to “reset” property values at their market rates when land is sold?
Could population forecasting by a third party, which would not be appealable, be used in land use decisions?
Those were some of the questions on the table Tuesday, Sept. 18, as state and local lawmakers gathered at a City Hall Week forum hosted by the City of Sweet Home.
The gathering, held at the Police Service Building meeting room, also included discussion of renewing the state’s 9-1-1 tax and support for various programs to redevelop brownfields and other environmentally damaged areas, such as Sweet Home’s.
A panel of state Sen. Fred Girod, Rep. Sherrie Sprenger, Steve Frank of Stayton, who is running against Girod in District 9, and Richard Harisay of Sublimity, who is running against Sprenger for the District 17 seat, weighed in on the issues.
Mayor Craig Fentiman said the event wasn’t intended to be a debate, but rather a chance for local city officials to list “legislative priorities” for representatives of the League of Oregon Cities at the forum.
Officials introduced five proposals drafted by the league, which provides lobbying services and training for 242 city governments throughout the state.
Local Control Amendment – Introduced by Sweet Home City Councilman Scott McKee, this proposed constitutional amendment would allow local communities to vote on option levies outside of compression and would lengthen the maximum duration of a levy from five to 10 years.
McKee noted that Sweet Home has been especially hard hit by compression and its low permanent tax rate. He said that Linn County’s local option levy and falling property values in Sweet Home have left the city with losses of $730,000 – “nearly a third of what the levy was supposed to collect.
“We’ve had to eliminate four positions and reduce library services,” he said. “We’ve also seen an increase in public safety employees seeking employment elsewhere, due to job security concerns.”
Sprenger and Girod cautioned that eliminating compression might make it harder to sell voters on local option levies.
“A big part of these campaigns is when you’re out campaigning and you say, ‘This won’t raise your taxes,’” Sprenger said. “This is not a silver bullet. You can’t say that because it will.”
She said she understood the difficulties of Sweet Home’s situation, noting that she remembers a campaign for an option levy to fund a Bookmobile in Albany a few years ago.
“How do you pick funding for jail beds over third-grade reading levels? Something is inherently wrong.”
Girod agreed, adding that he thought passage of such a proposal in the legislature would be difficult.
“I think you could very well lose,” he said. “Timing’s everything in politics and the timing’s not right.”
Frank, a former Stayton City Council member, suggested that Sweet Home consider merging its law enforcement with another community, which is what Sublimity and Stayton did.
He said tax reform is the “only” answer to the levy problems.
“We can’t keep doing things the way we’ve always done things,” he said.
Reset at Sale – Also a proposed constitutional amendment, this would reset a property’s assessed value to its real market value when it is sold or when construction occurs. Taxes would not be raised on a current home.
Finance Director Patricia Gray told the panel that “people are getting a break on their property taxes,” blaming the problem on Measure 50, passed in 1997, which created a new “assessed value” for all properties at 90 percent of the property’s 1995-96 real market value.
She said that, plus the capping of annual growth, have resulted in huge disparities in tax bills as property values have increased and as neighborhoods have gentrified. A related problem is that, due to varying ratios used to calculate the value of new property, “identical properties with the same sale price, but permitted only months apart, can have dramatically different tax liabilities.”
She cited a Lincoln Institute of Land Policy report that says of 17 states with similar property tax limitations, Oregon’s “has gone the farthest of any (in the country) in breaking the link between property taxes and property values.”
In response, Frank suggested repealing Measure 50 but the other panel members expressed doubts that simply resetting the values would have much effect in Sweet Home.
Girod pointed out that in larger cities, such as Portland and Eugene, such a move might help.
“If Sweet Home went to a free-market system, you’d get less tax revenue,” he said, because land values are very low in the area.
“Be careful what you ask for,” he said. “If the assessed value is lower, you get less tax revenue. There’s a disconnect between Portland and Eugene, compared to Sweet Home and Waterloo.”
Sprenger echoed that warning.
“In our desperation to pay the bills, let’s make sure we don’t do something that could bite us in the butt,” she said.
Jobs and Economic Development – Sweet Home’s Community Development Director Brian Hoffman presented a request for: $10 million to fund the Brownfield Revolving Loan Redevelopment Fund, which finances loans that commercial lenders can’t provide to clean up industrial sites; $25 million of Special Public Works funding to provide funding to municipalities to make industrial sites “shovel” ready for development; and $15 million to assist communities with funding incentives re-use or redevelop existing industrial lands.
Hoffman noted that a League survey indicated that lack of infrastructure is the biggest hurdle to attracting new or expanded industrial development.
“I think we’ve seen the benefits within our region of having shovel-ready sites,” he said, with a nod to Lebanon City Manager John Hitt, who was sitting in the audience. “In Sweet Home our growth has been plagued by problems that could be solved by these initiatives.”
Panelists were generally supportive of these proposals, though Girod said he wasn’t enthusiastic about funneling the money through the Oregon Business Development Department, which the League proposed.
He acknowledged that the state has lost “a tremendous amount of business” in recent years, but blamed labor laws and the failure to use natural resources.
“If we changed our labor laws and cut timber and took water out of the Columbia, then we wouldn’t need the Oregon Business Development Department,” he said.
Sprenger said the proposals were “viable” and she noted that smaller communities like Sweet Home have more difficulty making such improvements than larger cities, where the burden is spread over a greater population.
“This isn’t a silver bullet. This is a red-meat-on-the-bone kind of thing,” she said.
Harisay said he had a problem with public money going to private business.
“The money available here needs to be redirected to lots of things – not private enterprise,” he said.
9-1-1 Tax Renewal – City Councilor Greg Mahler, a volunteer firefighter for 23 years, presented a request to extend the 75-cent-per-month 9-1-1 emergency services tax, which is “the backbone of the budget that supports the planning, installation, maintenance, operation and improvement of the statewide 9-1-1 emergency reporting system.” He also asked that the rate be modified “to ensure adequate resources for both the management of the system and the acquisition of the most modern technology.
Mahler said the League is proposing that the sunset provision of the tax be removed and require that all monies derived from the tax go directly to emergency reporting services – not initially to the state’s general fund, which is the case now. He also proposed rewriting the law to make sure pre-paid cell phone users and voice over Internet Protocol users, who don’t currently pay the tax, are included.
“I’ve seen it where eight to 10 calls are coming in at the same time and two dispatchers are trying to handle those calls,” he said, in arguing that the 9-1-1 system needs adequate financing. “I’ve seen errors.”
Those proposals got unanimous support from the panelists with the exception of the removal of the sunset.
Sprenger, a former sheriff’s deputy, and Frank both said that removing the sunset is a bad idea.
“Sunsets are in there for the voters’ protection,” Frank said.
Gray and Fentiman spoke up and noted that Sweet Home is in the position of being a secondary 9-1-1 system and, as such, they said, funding for such secondary systems needs to be addressed as well.
Population Forecasting – Stayton City Councilman Brian Quigley proposed legislation that would provide cities with population forecasts, which are mandatory for updating their comprehensive plans, every four years and funded by the state through the Population Research Center at Portland State University. He also proposed that such processes would not be considered land use decisions and therefore would not be subject to appeal by the Land Use Board of Appeals.
He said cities have difficulty getting timely county approval of their own population forecasts, which slows land use actions and results in the loss of opportunities in that area.
Quigley said there would still be a challenge process if someone does not agree with the forecast, but that would be carried out by a peer review team of experts in the field, who would look at methodology, data collection and other issues.
Harisay, who said he moved to Oregon from another state because of rapidly encroaching development, said he likes the existing decision-making process because “the population needs time to respond” to land use proposals. He said he understands the urge for speed on the part of developers.
“They’re looking at their bottom line; we’re looking at the conditions of living,” he said.
Frank said the issue is “really important” for cities that want to grow.
Sprenger said the proposal does not eliminate appeals.
“It just says they can’t start attacking every piece of information as soon as it’s released.”