Scott Swanson
The downturn in the economy, coupled with the provisions of Measure 50, passed by state voters in 1997, has left some county property owners wondering who’s trying to stick it to them on their tax bill.
That’s because, for the first time in years, landowners are finding that the assessed value of their property is more than they think their land is worth on the commercial market.
“It’s rather annoying,” said David Hoard, who owns a tree farm on North River Drive, not far from Foster Dam.
Hoard, who is retired and living on a fixed income, he said, saw his property tax increase by $15 from last year to $546 even though the “real market value” the county assigned to his property dropped from $132,120 to $115,550.
County Assessor/Tax Collector Mark Noakes said that when Measure 50 was passed, nearly 15 years ago, it created an artificial assessed value based on 1995 values, less 10 percent and provided subsequently for 3 percent increases in that value per year.
“That became the baseline for 1997 for the assessed value of property,” Noakes said. “There’s also the real market value.”
The only other way property taxes can go up is if voters approve short-term “local option” levies, such as Sweet Home School District voters did in 2001 to renovate local school campuses, or to fund existing levies such as the Sweet Home Fire and Ambulance District or new operating levies such as the veterans home in Lebanon.
Thanks to double-digit inflation during most of the period since 1997, property owners have gotten used to seeing assessed values coming in below what their property is worth on the commercial market, Noakes said. That is, until the recent recession.
“It’s only in the last three years that we’ve started to see a decline (in commercial values). You can see the real market value was a lot more than the assessed value, almost from Day One. In terms of the overall market, it increased much faster, at a greater rate than assessed values.”
Noakes said Measure 50 created stability for taxpayers.
“They knew their tax bills wouldn’t go up in big swings with the real market value,” he said. But with the recent declines in property values, taxpayers’ “biggest investments” – their land – has dropped in value but the taxes haven’t.
“They forget that the tax value is allowed to increase,” Noakes said.
Hoard said the problem with Measure 50 is that “it doesn’t account for deflation.”
“Deflation needs to be added to old Measure 50, somehow.”
He said he has complained both to the county and to the Legislature’s Democratic Office about the problem.
County officials, he said, say there’s nothing they can do to fix the problem because it’s a state law.
“Going to the county was a waste of time,” he said.
Hoard said last year he contacted state Rep. Sherrie Sprenger about the problem but “nothing happened,” so he went to the Democrats this year.
“Hardly anybody understands it,” he said of the taxation formula. “It took me a while too.”
Hoard said he’s urging property owners to appeal to the Board of Property Tax Appeals if they thing their statements are out of balance and then write letters or make calls to state legislators and the governor’s office.
“If they don’t get enough appeals at the county level, or if they don’t have enough contact at the Legislature, nothing’s going to happen,” he said.
Property tax appeals must be filed by Dec. 31, 2010.
Noakes said that his department will review cases in which property owners believe the county’s numbers don’t match up with reality.
“If the real market value is substantially lower than what they have on their tax bill, they should ask,” he said.
For more information, visit the County Assessor’s Web site, which explains Measure 50 and includes a variety of answers for property owners: http://www.co.linn.or.us/assessorshomep/assessor.htm