The Governor’s Task Force on Federal Forest Payments and County Services, Final Report, January 2009 details a number of preemptive steps hard hit rural counties should consider enacting to handle the loss of federal forest payments. The report is broken down into sections that outline what the counties can do for themselves, what the state and state taxpayers can do for the counties and how the federal government might better share resources and revenues.

Number one, of course, is to use the full extent of local property tax capacity. For Coos County, this move alone is projected to cure 90% or more of the county’s budget shortfall. Naturally, it is not a popular option but consider that Coos County average property tax rates $1.08 per $1,000 are less than 38% of the $2.80 per $1,000 statewide average and that commercial and industrial property owners pay a fraction of that amount. Since these large property owners have not successfully reinvested their tax savings into job creation it is not unreasonable to ask them to pay their fair share for the use of local infrastructure and services.

Counties statewide have significant unused property tax capacity within constitutional limitations;
o It is reasonable to expect hard hit counties to seek voter approval of property tax increases in the range of ten percent to 30 percent, which will increase overall taxes paid by county taxpayers by just two to five percent; and,
o Counties should be freed from restrictions in state law that limit or prohibit their ability to enact transient lodging tax and real estate transfer taxes.

Understanding that voters are disinclined to approve significant tax increases the report discusses the likelihood of creating special service districts, a concept that’s been successfully implemented in Oregon counties.

Another option for ongoing increases in county tax effort lies in the creation of special
taxing districts for such services as sheriff’s patrols, library services, emergency and agricultural extension services. A list of allowable purposes for such districts is contained in ORS 451.010.
County service districts, which require voter approval, offer the advantage of a new permanent taxing rate for the services for which the districts are created.

The report also discusses amending state law to allow the counties more flexibility to use the money they have within the general fund.

The next course of action is to shift more of the burden to the rest of the state. Asking the state taxpayers to pick up more of the tab for counties that refuse to pay an equivalent property tax rate is not necessarily fair or without political consequence but it may be possible to ask for increased funding for shared services.

The report also talks about increasing harvests on federal forest while simultaneously recommending using the forests as carbon sinks for tax credit revenues.

In short, there are a lot of recommendations made here that have never been brought before the people for discussion. Instead, the county is on a one track course to cut down the Coos Bay Wagon Road…

UPDATE Commissioners reaffirm that raising property “taxes is not a viable option in this economy.” This thinking is why resource rich communities are historically poor and economically challenged. The greatest assets are undervalued to benefit private groups that heretofore have failed to reinvest in the area and create new jobs. The ideology shared by all three commissioners condemns the very assets that should enrich everyone.