Editor’s note: This is the fourth in a series of special articles examining Curry County’s fiscal crisis and possible options. Correction: The label on the graphic illustration on Page 1 of Saturday's Pilot should read "per capita property taxes for county government."

Curry County has the second lowest property tax rate  for county government in the state. Oregon Gov. John Kitzhaber says a tax increase has to be considered in solving the county’s fiscal crisis.

When the governor’s letter was published, the Curry Coastal Pilot put a reader poll about property taxes on its website, www.CurryPilot.com.

A month later, the trend is clear: 53 percent of 863 responders say they will vote against any new taxes. Another 5.6 percent say they’re skeptical. 

Only 27 percent say they know an increase is necessary, with another 8 percent admitting they might vote yes “if it’s done right.”

That’s a better margin than the 72 percent-28 percent rejection a year ago for a special five-year property tax levy to support the county’s public safety services. 

Those services – sheriff’s office, district attorney’s office, and juvenile department – are 73 percent of all costs in the county’s general fund budget. 

With federal support payments slated to end, savings from previous years all used up, and services at what officials call “bare bones” levels, the county warns of a crisis.

But when county officials look for outside help from state or federal agencies, one thing sticks out: Curry County’s very low property tax rate for county government. 

It’s 60 cents per $1,000 of assessed property value, compared to an average of $2.81 for Oregon’s 36 county governments. Put another way, the average Curry County resident pays $60 a year for county government; the average Oregonian pays $167.

“Curry County has a tax rate that is much lower than other counties that receive county payments,” wrote Gov. John Kitzhaber. “In any scenario, providing an adequate level of service to the public in Curry County will require re-examination of this tax rate going forward.”

When a special Citizens’ Committee convenes next Wednesday to examine the county’s fiscal crisis, there are no specific directions from the county commissioners for their recommendations. It is clear, however, that there will be a discussion of property taxes, the traditional and only substantial tax option open to local government in Oregon.

“We’re going to see what recommendations they come up with,” said Commissioner Bill Waddle, “but I’m pretty sure that we’re going to come up with some sort of a proposed levy to get on the May ballot.”

Asked about the Pilot’s website poll on taxes, Waddle says “I watch it daily.”

When a report from Oregon Solutions talks about a property tax increase, it opens the section with a qualifier: “If it were politically feasible ...”  

A vast majority of property tax comes from residential property. What would a property tax increase look like for an individual home? 

The total assessed value of residential property for 2010-11 is $1,401,141,000, and the census shows 12,613 housing units. That gives an average assessed value of $111,000. Here are the “average” bills for various rates:

– At 60 cents per $1,000 assessed value, the average home now generates $66.60 in property taxes for county government. 

– County officials believe a rate of $1.40 would  stabilize the problem; that would be $155.40 for the average home. 

– To go up to the state average tax rate for county government of $2.81 would mean a bill of $312 to the average home.

– If a decision is made to put Curry County back into Coos County (where it was before statehood), some officials presume the Coos County tax rate of $1.08 would apply. That’s $119.88 for the average home.

“A $1 increase in property taxes would generate about $2.4 million for the county,” says Waddle. That would be $111 for the average home.

The hurdles for voter approval of additional property tax include the national anti-tax climate, the state’s property tax limits, and Curry County’s peculiar demographics, economics and geography.

Geography first: Curry County’s forests and much of its oceanfront property is owned by the state and federal governments, neither of which pay property taxes. Private farm and forest lands also pay little or no property taxes.

That leaves just 4 percent of the real estate in the county as taxable. County officials have long said that even if every piece of taxable property was built to its potential, the county’s current property tax rate would not generate enough revenue to cover the county’s expenses.

Under state tax rules, approved by state voters in the property tax revolts of the 1990s, there are strict limits on raising local property taxes. Those rules leave just one more chance, May 15, before the county’s 2012-13 fiscal year starts on July 1.

The national anti-tax mood reflects the results in Curry County’s last levy election. A recent Rasmussen Poll shows that 70 percent of respondents would prefer lower taxes, even if meant fewer government services. 

Where voter approval of taxes may be even more difficult in Curry County is in its demographics and economic condition.

For decades, the timber harvests on federal lands provided revenue sharing to the county and jobs for its residents. When the timber harvests stopped on federal lands, the revenue sharing stopped and the mills closed. The loggers and the millworkers moved away. 

That decline has continued in the past decade, with “forest cluster” jobs in Curry County dropping by another 20 percent, according to the Oregon Employment Department. The jobless rate in Curry County tends to be 2 points higher than the state average.

In their wake, the loggers and millworkers left a stock of inexpensive housing, with low property taxes, amid a beautiful landscape with a mild climate. Retirees replaced the timber industry.

Curry County’s lumber and wood products jobs dropped from about 1,000 in the 1970s to less than half that in 2010. The population over residents over age 65 rose from about 1,400 in the 1970s to 6,300 in 2010 – now 30 percent of the population.

Retirees skew the personal income data in two ways.

First, income is lower. Curry County’s per capita personal income is 96 percent of the state average and 88 percent of the national average. 

Second, more personal income comes from “fixed” categories: retirement, Social Security, Medicare, public assistance, dividends, interest, rents and unemployment. Some 63 percent of income in Curry County comes from those categories, compared to 40 percent in Oregon and 37 percent nationwide.

County officials recognize that putting a property tax levy on the May ballot is much different than believing that it might pass.

On Tuesday, the elected officials – commissioners, sheriff, assessor, clerk, district attorney, surveyor and treasurer – agreed to start working on two spending plans for 2012-13, including one with no new federal support payments and no new property taxes.

“There was a consensus that we should do a budget with a 25 percent across-the-board reduction in all general fund departments,” said Waddle. “This is our way of trying to get some real concrete information into the loop, and have it available before the second Citizens’ Committee meeting.”

Having done townhall meetings and presentations for last year’s levy election, Waddle admits that information doesn’t always bring yes votes.

“There’s a lot of people who are really feeling a tremendous amount of pain from this economic situation,” says Waddle. “No matter how much good information you give them, they’re still going to vote no.”

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Next: Are there other sources of income for county government?