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had surveyed the 17 largest fire departments in the state; 11 departments were municipal departments provided out of general fund governments like Eugene and six of the departments were fire districts. He said that typically, departments in jurisdictions with populations of 50,000 or more were delivered municipally like in Eugene, and rural areas with populations of 49,000 or less formed fire districts for better efficiencies and economies. He noted that the exceptions were the Tualatin Valley and Clackamas 10 fire districts, both of which were located in the metropolitan area around Portland. He said that Gresham had disbanded its fire department and was scheduled to vote on annexing into the Clackamas Fire District 10. He concluded with the observation that the City was in a good position to take no action regarding changes to the provision of emergency services. Mayor Piercy noted that there was an effort in the legislature to eliminate the Lane County Local Government Boundary Commission to ensure that cities could not prevent the formation of special districts. Ms. Bettman said that legislation had been drafted but not yet introduced that would eliminate the boundary commission and another bill was being considered that would only remove the commission's authority with respect to public safety and library districts. She agreed with the staff recommendation regarding the possible formation of a fire district. Financial Analyst Larry Hill, responding to a question from Ms. Bettman, said that compression was computed on a property-by-property basis and industrial property did not increase in value as quickly as other types of property. Much of the compression, where the assessed value approached the real market value, was occurring in industrial properties. He said that for most properties the average relationship between assessed value and real market value was approximately 80 percent. He explained that when taxes were $10 per $1,000 of real market value compression occurred and taxes on that property were reduced until the $10 cap was no longer exceeded. He noted that local option levies were affected first and then permanent levies were reduced. Ms. Bettman asked how a special district that only included the County would differ from the County, which had taxing authority. Principal Planner Kurt Yeiter explained that it was a legal difference that consisted of being able to exempt those costs from the base property tax and charge additional taxes for special district activities. Ms. Bettman expressed the opinion that because it was so much more expensive to provide services in rural areas, urban taxpayers would then be faced with either a diminished level of services or higher taxes. Mr. Kelly said he supported the staff recommendation to take no action. He commented that most people regarded police and fire as basic services provided by local government and there was no compelling evidence that a change in the current structure was desirable. He acknowledged the level of cooperation that existed among local fire departments. He expressed concern that a fire district governed by a five- member board would further confuse the public and increase the disconnect from decision- and policy- makers. He thanked Mr. Hill for his explanation of compression and its impact on the City. He asked if projections of the impact of compression in coming fiscal years were being done. Mr. Hill said that a model to anticipate compression in the future was being developed and he hoped that some results would be available during the council's budget discussions. In response to questions from Mr. Pap6, Chief Tallon said the survey of 17 fire departments addressed the MINUTES--Eugene City Council March 7, 2005 Page 3 Work Session