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Voters may see additional tax options

Curry County citizens had better get ready to vote again.

After the May 21 defeat of a property tax rate hike that would have funded public safety in the county, commissioners have found themselves right back where they were on Jan. 3 when they took office and began to address the challenges of fiscal solvency.

Now, they’re working under the constraints of a $2.1 million budget and believe it might take a September special election to get funding for public safety.

They will discuss that and other options at a meeting today (June 5).

The goal remains the same: Fund law enforcement while giving commissioners time to create a public safety special district and a permanent means by which to pay for it.

Commissioner David Brock Smith thinks consolidating the county 911 system with that in Brookings will reduce expenses – and thus decrease the amount of a possible income tax surcharge the state could impose.

Commissioner David Itzen is leaning toward a sales tax.

Commissioner Susan Brown favors a mix of all of them, to avoid placing the burden on the backs of a few.

Tax measure 8-71 was crafted in a few short weeks when commissioners realized they needed to shore up public safety agencies, and once again they have a short window – a mere 24 days – to begin the process to get on the ballot a tax measure that’s more palatable to a tax-averse electorate.

After all the discussions are held, and if all the deadlines are met, commissioners face the ultimate challenge. Any ballot question in a special election is required to get a “super-majority” of the vote – a majority of ‘yes’ votes and voter turnout of at least 50 percent.

Voters just missed that threshold in the recent election that county officials said they thought would have attracted a much larger percentage due to its volatility.

Sales tax

The Citizens Committee last year suggested the citizenry might approve a sales tax at a 3 percent rate with exemptions for such necessities as food and medicine or a 2 percent rate with no exemptions. Such a tax could be permanent or temporary, Itzen said.

“The Citizens Committee favored the sales tax as an alternative that should be considered,” Itzen said Monday. “Since we’ve not been successful with the property tax measure, it seems appropriate.”

It could also include taxing services – attorneys, cleaning companies, auto repair, yard services and others. That, Itzen noted, would further spread the tax burden and lower the rate, he said.

“Why should only goods be taxed?” he queried. “If someone who makes something that is sold is taxed, but an attorney who makes his living by his advice is not taxed? Is that fair? Maybe that should be considered.”

Either has several advantages, he noted, including that there would be no disparity based on someone’s place of residence, as the split-rate property tax proposed. Out-of-county residents would chip in on every purchase, as well, and out-of-pocket taxes would be based solely on how much one spends.

“Folks seem to regard this very favorably – especially in light of the defeat of the property tax measure,” Itzen said. “Part of my motivation is to make it Curry County solvent, rather than have the state come in because we cannot, and will not, fix it ourselves.”

Lane County did, and many there attribute it to the measure’s specific language saying the 55-cent tax increase was to fund juvenile services and jail beds.

“Maybe a revised property tax,” Itzen said. “Maybe drop revenue needs from $5 million to four or three? Take 911 out? There are things we could do to lower the amount slightly.”

The sales tax idea would, like the property tax, last five years, to again give county commissioners a “bridge” in which to craft a law enforcement district and the means by which to permanently fund it, Itzen said.

Some said they might have voted for the tax measure if it sunsetted in fewer years, but Itzen said it will take at least two years to create a law enforcement special district.

“It cannot be done in two years; I would be very nervous about that,” Itzen said. “Could it be done in three or four? I think we could have settled for four to craft the measure, explain it to everyone, have them kick it around. If that would’ve made the difference, that’s something we need to talk about.”

Most of the work to implement a 2 percent sales tax has already been done, Itzen said. But if commissioners propose a 3 percent tax with exemptions, that tinkering could delay any ballot question until November or even May 2014.

Brown said she first wants to tackle a Transient Lodging Tax – a tax upon which the three commissioners agree and one voters might approve because it doesn’t affect them.

“It’s already in place in three cities and the state – it’s not a new procedure (to implement),” she said. “I think we could implement it by January 1 to have revenues come in.” 

Currently, the cities of Brookings and Gold Beach have a 6 percent lodging tax; Port Orford’s is 7 percent. The county has none. In Gold Beach and Port Orford, 70 percent of revenue goes to promote tourism; the remaining 30 percent goes to town coffers. In Brookings, because it had a TLT in place before the state implemented that legislation, 25 percent goes to tourism promotion. 

First, Brown would like to see the TLT bumped to 9 percent for every lodging facility in the county. It would mean a 2 percent hike for hotels in Port Orford, but 9 percent for those in unincorporated areas of Curry County.

“Everyone’s doing 9 percent,” she said. “That’s still less than Del Norte – even Grants Pass. I don’t think 9 percent is out of line.”

Such a tax change would merely take a vote locally. But to divert those funds from tourism promotion, as required by state law, will take the governor’s approval.

The percentage diverted could also be tapered down each year until, in 2018, marketing efforts would again receive its full allotment of funds – and county commissioners would have in place a law enforcement special district.

Based on figures Brown recently received from the Department of Revenue and the county, if Curry County had had a TLT in place in the past five years, it could have reaped about $1 million a year in lodging tax revenue.

Even if the governor’s office only permitted the county to reallocate its 30 percent of TLT funds, it would garner $302,000 for law enforcement, Brown said.

Along with that, Brown said, she’d like to see a temporary tax to fund current services and then, perhaps a sales tax.

“It’s got to be a combination of funds,” she said. “I want to see a mix. The burden’s got to be on more than the property owners’ dime.”

Smith said any measure proposing a mix of taxes is set to fail.

“I don’t want to convolute it and make voters think we don’t have to address this for the long-term,” he said. “I’d be very concerned about throwing multiple measures on a ballot; it weakens them all.”

He said he is fully behind the idea of a TLT and partnering with other organizations to fund tourism.

“The problem is, we have to save the county first,” he said. “And what would we promote? Lawlessness? We have to secure Curry County before we can promote it as a better place to live, work and do business.”

To address immediate problems, Smith would like to consider consolidating the two 911 systems in the county and placing them in a district funded by existing 911 user fees. Such a consolidation – another suggestion made by the Citizens Committee – could result in a $500,000 savings, Smith said. Removing 911 from the equation would mean the county would need less money to function, bringing any possible tax rate increase to $1.67 per $1,000. Voters would still need to approve any such measure.

“By taking out 911 communications from the levy, it lowers the amount the county needs from $4.5 million to $3.925 million,” he said. In changing the (tax rate) ratio (between city and urban homeowners), as requested by the cities, we’re looking at a flat rate of $1.67. One of the last departments that can be moved out to stand-alone can be 911 communications.”

Commissioners and mayors hope to meet soon to discuss their communities’ needs and ideas before submitting anything by June 29.

“People aren’t going to vote for something just because we need it,” Brown said. “They’re going to vote for something that’s reasonable for them. We need to find out, from their perspective, what kind of government they want, what services they’re willing to pay for and what their threshold is. It will take a marriage of several things. Voters need to know that however we go forward, everyone is working toward it.” 

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