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County voters to decide vets home levy


August 15, 2010

The Linn County Board of Commissioners sent to the Nov. 2 ballot a proposal for a 10-year local option levy to help pay for the construction of a new veteran's home in Lebanon.

The 150-bed facility, 86,500 square feet, will be constructed by the Oregon Department of Veterans' Affairs at an estimated cost of about $30 million. The home will be located on 10 acres north of Pioneer School in Lebanon, adjacent to the Health Sciences Campus and Samaritan Lebanon Community Hospital.

The project will provide a second home in the state. The Dalles has a 151-bed facility.

According to the U.S. Department of Veterans' Affairs, Oregon needs 800 beds, said Jim Willis, director of the ODVA

The home provides a variety of flexible choices and service options, including killed nursing care, treatment for patients with Alzheimer's disease, rehabilitative care and long-term care.

The home's proximity to the new facilities for the Western University of Health Sciences and SLCH will allow for the opportunity for added services to resident veterans.

As part of the site selection process, the agency looked for a commitment for about 35 percent in local matching funds. The federal Department of Veterans' Affairs will provide the remainder of the funding.

The matching funds, including the match requirement and cost of the land, is approximately $12 million and will be provided by an internal loan from the Linn County Road Fund, which has a balance of about $33 million.

The loan would be repaid over 10 years by the proposed local option levy. The levy would raise an estimated $1.3 million in its first year, increasing a little each year afterward. By the ninth year, the levy is estimated to yield nearly $1.6 million and in the final year of the levy, $357,000.

County officials are estimating a tax rate of 19 cents per $1,000 of property valuation.

The tax will increase tax compression effects, and depending on the status of individual properties, property owners may see no tax increase at all while others will pay the entire tax.

Compression is authorized tax revenue that government agencies do not collect when tax rates exceed the $10 general government tax rate limitation.

If an individual property is taxed at $11 per $1,000, all local option levies are reduced equally until the rate is $10. Once all local option levies are reduced to zero, then compression would begin reducing permanent rates, such as the city's and county's general tax rate, until the rate reaches the $10 limitation.

Local option levies around Sweet Home include the Linn County Sheriff's Office's Law Levy and the city's Police Department and Public Library levies. Permanent rates include the Cemetery District, the Extension Service, the city, the county and the Sweet Home Fire and Ambulance District.

A proposed aquatics district to fund the pool in Sweet Home would carry a permanent rate as well if approved by voters.

Commissioner Roger Nyquist told The New Era during the spring that he preferred to include the tax levy inside the $10 limit by using a local option levy rather than a general obligation bond, which would fall outside the $10 rate limitation, increasing actual tax payments for everyone by the full 19 cents.

Up front, internally lending money to the project and avoiding the general obligation bond process, the county will save $400,000, said Commissioner John Lindsey on Monday. Using an internal loan avoids the costs of issuing bonds and allows the interest on the loan to be paid to the county's Road Fund rather than outside bond holders.

"The interest payment is back to the citizens of the county not Wall Street banks," Lindsey said. "I'm not a big fan of Wall Street banks €“ crony capitalism.

"I'm interested in getting a project in Lebanon that we can leverage 300 healthcare jobs."

Those jobs will range from laundry services to doctors and nurses, Lindsey said.

He doesn't like taxes, he said, but "I am quite comfortable with this."

It will be a benefit to the county and to the county's veterans, who are extremely underserved without traveling, he said. It may lead to a Veterans' Administration clinic and other opportunities.

Lindsey and the commissioners believe the levy will be paid off in fewer than 10 years unless the economy completely tanks, he said. But he doesn't believe Linn County's economy will completely tank.

"When I look at 10 years, what it would cost, I think it's a worthwhile investment," Lindsey said.

The levy authorizes $12 million in taxes plus interest, Lindsey said, but he doesn't think it will take the full amount. Until architectural designs are solidified, cost estimates will remain estimates though, and it will be hard to say exactly how much the project will cost taxpayers.


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