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current Metro Plan is not favorable to new special districts serving incorporated territory, Metro Plan
<br />amendments must be completed before the Boundary Commission can be expected to act affirmatively on
<br />any such proposal.
<br />
<br />Numerous rural fire protection districts serve the suburban and rural fringes of Eugene and Springfield
<br />(e.g., Goshen, Coburg, McKenzie, Mohawk Valley, Bailey-Spencer, Eugene #1, Lane Rural, Santa Clara,
<br />Zumwalt, Pleasant Hill, and Willakenzie). Effective July, 2003, the Southern Lane RFPD merged with the
<br />Creswell RPFD, and the territory of the City of Creswell has also been annexed to the Southern Lane
<br />RFPD.
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<br />Tualatin Valley Fire and Rescue, the second largest fire department in Oregon, is a well-known RFPD
<br />serving incorporated and rural areas. It provides fire protection and emergency medical services to over
<br />418,000 citizens throughout its 210-square-mile jurisdiction. The district's service area includes the cities
<br />of Beaverton, Durham, King City, Oregon City, Rivergrove, Sherwood, Tigard, Tualatin, West Linn, and
<br />Wilsonville, as well as unincorporated areas within Clackamas, Multnomah, and Washington Counties.
<br />
<br />Constitutional General Government Tax Rate Limit and Tax Compression
<br />Measure 5, which was passed by voters in 1990, limits the combined tax rate for "general governments"
<br />to $10 per $1000 of real market value (RMV). General governments include cities, counties, urban
<br />renewal districts, and any non-school special districts. At the time that Measure 5 was passed, assessed
<br />value (AV) and RMV for properties were essentially equal.
<br />
<br />Measure 50, which was passed by voters in 1997, changed the tax system so that properties are taxed on
<br />the basis of an AV that is generally lower than the RMV for the property. In FY05, AV is only about
<br />80% of RMV on average, with some properties having an AV closer to or equal to RMV. For most but
<br />not all properties it is possible for the total general government tax rate on a property to exceed $10 per
<br />$1000 of AV and still be within the $10 per $1000 of RMV tax rate limit.
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<br />When the taxes for general government services on an individual property do exceed $10 per $1000 of
<br />RMV, the taxes on that individual property are compressed. This occurs in a two-stage process for each
<br />individual property. First, any local option levies are proportionally reduced until either the $10 tax rate
<br />limit is no longer exceeded, or until the local option levies are reduced to zero for that property. If the
<br />local option levies are reduced to zero and the tax rate remains above $10, then taxes on the city, county,
<br />urban renewal districts and non-school special districts are reduced proportionally until the limit is no
<br />longer exceeded for that individual property.
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<br />Once the total general government tax rate exceeds $10 per $1000 of AV, properties that have an AV
<br />equal to the RMV will be in compression and will not have to pay taxes that exceed $10 per $1000 of
<br />AV. In FY05 the City of Eugene is expected to lose about $80,000 in revenue from the Youth Local
<br />Option Levy and Library Local Option Levy as a result of compression.
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<br />If the tax rate is raised to a higher level in the future, as from imposition of a new tax under a special
<br />district, in addition to crowding out the local option levies, the General Fund could experience a revenue
<br />loss as a result of compression. This factor will have to be considered as a cost to the city in any financial
<br />feasibility study concerning a new special district.
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