Property Tax / Free Residential Use
This proposal would provide the funds used to operate the Beaver Hill Disposal facility (BHD). Two main concerns about this proposal have been expressed. One has to do with the tax resulting in free residential use of the BHD facility. Commercial haulers worry that they will lose customers if they can use the BHD facility for free. I do not believe it will have a serious negative impact because people who use collection services now will continue to do so and the potential savings in tipping fees would offset any loss. What it will do is stop some of the illegal dumping by people who cannot afford, or will not use, the services that are available to them at the current rates(Photos). The other concern involves something called compression; compression is a form of property tax limitation that became a concern when measure 5 was passed by voters in 1990. The measure places property taxes into two categories, education and general government. Education is limited to $5/$1000 of Real Market Value (RMV) and general government is limited to $10/$1000 RMV. If taxes in either of these categories exceed their ratio, the effected properties taxes are compressed (reduced) to its ratio. This compression begins with local taxes and if they are compressed to zero then all remaining taxes begin being proportionally compressed. RMV is the value that a specific property could realistically expect to sell for. In 1996 measure 47 was passed by voters creating a separation between RMV and Assessed Value (AV), but due to confusion in interpretation of the measure, it was revised and passed by voters as measure 50 in 1997. This measure rolled property values back to 90% of what they were in 1995-1996 to establish the AV, then limited increases of AV to a maximum of 3% per year. Over the next ten years RMV’s increased as much as 20% per year while AV’s were held to 3% per year. This has created a significant gap between the two values. Property taxes, both old and new, are based on the AV. Even with the economic downturn of the last couple of years, RMV’s state wide exceed AV’s by 50% or more. I believe there is sufficient room in the general government ratio to support this proposal without entering into compression.
The BHD facility has been operating on an average annual budget of approximately two million dollars per year, funded by the monies collected from public and commercial users. The BHD facility has been operating independent from the general budget since 1994. Over those years the only changes in our operating budget have come from a couple of rate increases and fluctuating use by our customers. This has resulted in a drastically reduced workforce. We are budgeted yearly for 18 people but we have not had more than 12 full time employees for at least the last three years. The budget that we actually operate on makes it very difficult to contract out maintenance and repair work, requiring us to do the majority of the plant and vehicle maintenance and repair ourselves, and while the employees at BHD are very talented, there are elements of the facility that require us to contract for repair and refurbishment. The assessed property values for Coos County for the 2008-2009 fiscal year were $4,031,280,000 plus $169,495,000 urban renewal excess value, giving the County a total assessed value of $4,200,775,000. Based on these figures, a tax of $.50 per $1,000 of assessed property value ($75 per year on a property assessed at $150,000) would generate just over 2.1 million dollars in revenue per year which would equal the current operating budget of the BHD facility. The tax would eliminate the need to collect a user fee for Coos County residents who could then dump for free if they chose to bring their garbage to the BHD facility, and since property assessments increase about 3% a year, increases in operating costs could be met without the need to raise the amount of the tax. Since our operating budget would already be met, commercial hauler rates could be cut from the current $79 per ton to a rate competitive with landfill sites like Coffin Butte. I would recommend a rate of $35 to $40 per ton; this would result in a 50% to 55% savings to the haulers in tipping fees alone. They would also save on fuel and other operating costs when they use the BHD facility versus Coffin Butte, savings that could be passed on to their customers. Although the amount collected from commercial haulers would be about half what it is now per ton, even if the amount of garbage we received from them didn’t increase, the amount collected would still be in excess of $700,000 per year. This money could then be used to build the funds required for final closure and monitoring of the three sites Coos County is responsible for, Beaver Hill, Joe Ney, and Bandon, roughly estimated at $9,000,000; of which we are currently $6,500,000 short. It can also be used to build an operating reserve and to pay for maintenance, repair, and refurbishment of the facility.
I believe that this proposal can be structured to give added protection from compression to those local, city, and county entities that are funded by taxes. By creating an operating reserve with the funds generated from commercial tipping fees this tax could be reduced, or even suspended, in any area where compression would be invoked, and the loss in tax funds could be made up through the reserve funds.
This is the proposal that I most strongly support. I believe that even if the feeling is that this is not the right time to ask the voters to support another tax we have successfully solved the original concern regarding the life of the current ash trench. After an updated survey and the addition of a metal removal operation the current ash trench probably has more than 15 years remaining, allowing time to carefully research many options including adding new customers and adoption of a System Benefit Fee, and that residents still see this facility as beneficial to them both economically and environmentally. I urge the Commissioners to work with us to secure at least the funds that are needed now, and continue to work with us to develop the best plan for residents in the future.
fmesserle@co.coos.or.us cparry@co.coos.or.us bmain@co.coos.or.us ourcountysite@charter.net
