March 01, 2004
Property Taxes And The 'Urban Renewal Special Levy'
About That 'Urban Renewal - Portland' Line Item
As it happens, while perusing the Portland Development Commission's answers (pdf) to questions about urban renewal raised by the City Council during its (continuing) consideration of extending the Downtown Waterfront Urban Renewal Area, we finally discovered just what was up with the mysterious property tax line item about which Jack Bogdanski was wondering last month.
We're not going to go into the specific DTWF URA analysis contained in that document right now, but just point out the bits that led us to answers regarding that line item. The first key indication was this bit, from page three:
b) PDC and Council could elect to reduce the amount of the Special Levy, resulting in a reduction to City of Portland property tax bills;
This caused the recognition alarms to go off, because it seemed to indicate that there were indeed urban renewal funds that came out of everyone's property tax bills, regardless of whether or not they happened to reside in an urban renewal area.
Here's what Christine Egan of the PDC had to say when I asked whether the Special Levy was in fact the culprit when it came to Jack's property tax bill:
Yes, the "urban renewal special levy" is the line item "urban renewal-Portland." This yearly levy (total amount is set at $15 million) is divided among the four Option 3 Urban Renewal Areas (URA) as established under Measure 50. The four Option 3 URAs are the Oregon Convention Center Urban Renewal Area, Downtown Waterfront, South Park Blocks, Airport Way. Following the passage of M50, the Oregon legislature allowed urban renewal plans already in existence and categorized as an Option 3 district to use the "urban renewal special levy" to make up some of the revenues that would otherwise be lost under the provisions of M50.
So the existence of such a tax item traces back (as so much seems to do in Oregon) to the passage of Measure 50. From the Oregon Department of Revenue, we found a page on urban renewal which further describes the Special Levy:
The voters approved Measure 50 in 1997. This measure requires the Legislature to protect some urban renewal plans from losing revenue as a result of the measure. The division of tax method created by Measure 50 produces less revenue than could have been produced under the prior method. Special levy power was created to protect plans from this loss. The plans adopted before December 6, 1996, are protected.
The law allows these plans the option of imposing a special levy up to a maximum amount. The assessor calculates a separate tax rate for each special levy. The levy is billed to all taxpayers in the city or county that established the plan. Amounts for this levy may appear separately on the tax statement or combined with the amount for division of tax. Taxes imposed for the special levy are not divided. These taxes are subject to the Measure 5 general government limitation of $10 per $1,000 of real market value.
The amount distributed to the urban renewal agency is shown as a separate amount on the tax statement even though it is not a separate tax.
So the answer is revealed by further financial arcana as produced by Measure 50. Whether or not this explanation does -- or should -- satisfy those wondering about the "Urban Renewal - Portland" line item on their property tax bills is a matter we won't try to address here.