Many taxpayers will see increases

When tax statements go out on Oct. 17, some Jefferson County residents may be in for a surprise.

After several years of declining property values and taxes for many homeowners, this year, market values have begun to climb in some areas. However, they still remain well below the levels reached in 2007-08.

In some cases, the increase has translated into taxable values rising as much as 11 percent in areas such as The Pines and Strawberry Heights subdivisions in Madras, which had experienced dramatic decreases in values over the past few years due to the effects of foreclosures on the market.

Countywide, there was a 1.71 percent increase in taxable assessed value, from $1,428,714,661 to $1,453,141,355. The city of Madras was up 2.99 percent, and Metolius, up 1.06 percent, while the city of Culver dropped about 0.34 percent.

Taxable assessed value is based on the lesser of the real market value — which can show dramatic increases or decreases — or the maximum assessed value — which can increase by no more than 3 percent per year.

The maximum assessed value is the result of Ballot Measure 50, passed in 1997, which established a taxable limit for a property based on its value in 1995-96, minus 10 percent. From that point forward, unless the property changed, the maximum assessed value could increase no more than 3 percent per year.

One home's history

As an example of a home facing an 11 percent increase this year, Jean McCloskey, Jefferson County assessor, cited a home that came onto the tax rolls in 2006, and had a real market value of $172,260 in 2007. The maximum assessed value at that time was $67,492, but that value continued to climb at about 3 percent a year until 2011, when it reached $75,940.

Because the real market value on the house dropped to $60,900 in 2011 — lower than the maximum assessed value — the maximum was frozen until the real market value once again rises above $75,940. Since the RMV was lower than the MAV, the RMV became the taxable assessed value.

Last year, the home's RMV dropped even further, to $54,120, while the maximum remained frozen. So, this year, when the home's RMV rose 11 percent, that meant that the taxable assessed value also went up 11 percent.

"In Deschutes County, they have 20 or 30 percent increases in some areas," she said.

Changed property ratio up

Newer homes come onto the tax rolls at a rate determined by the changed property ratio — the average assessed value in the county divided by the average real market value of all other residential property.

That figure has increased substantially since 2007 and 2008, when new homes coming onto the market were taxed at just 41 percent of their real market value. This year, the changed property ratio is a healthier 88.5 percent, which means new homes are no longer paying taxes at a much lower rate than older homes.

Compression is pretty similar to last year, according to McCloskey. "It's still a factor on a lot of the accounts; when market values start going back up, it will be less of a factor."

Under Measure 5, which took effect in the 1991-92 tax year, general governmental taxes were limited to $10 per $1,000 of real market value of property, and school taxes to $5 per $1,000.

For example, residents in the city of Madras, for example, pay county general, library, Jefferson County Fire District, Mountain View Hospital, city, and Madras Aquatic Center levies, and local option levies for the county jail and MAC. The total of those general governmental levies cannot exceed $10 per $1,000 of real market value on the individual account.

If the levies total more than $10 per $1,000, local option levies, such as the levy for the county jail and MAC, are the first to feel the compression — or reduction — first.

Across the county, compression losses amounted to $720,378.33. The city of Madras was the biggest loser, with a loss of $179,969.57 to the city, including Deschutes Valley Water District.

The Madras Urban Renewal District will receive $331,526.18 this year after compression, down from the $359,994.82 it took in last year. Culver's URD will take in $33,246.20 — up from last year's total of $25,111.92.

In 2013, there were 511 residential sales, up from 482 in 2012. Of those numbers, 40 percent were foreclosure-related in 2013, and 41 percent in 2012 — showing a slight decline in foreclosures. So far, for the 2014 assessment year, foreclosures are down even more, to 24 percent of sales.

Hit particularly hard by foreclosures was The Pines subdivision, where all sales in 2012 were foreclosure-related. For 2013, that had dropped to 43 percent bank-owned, and for the start of the 2014 assessment year, 14 percent.

The biggest changes affecting this year's taxes include: School District 509-J retiring bonds from 1993 and 2002, but passing a new bond for 2013; Madras Aquatic Center passing a local option levy of 40 cents per $1,000; and the Jefferson County jail bond levy dropping from nearly 78 cents per $1,000 last year to 40 cents per $1,000, as the county pays it off early.

Top 10 taxpayers

The top 10 taxpayers in the county remained the same for the 2013 tax year. Topping the list were three utilities: Portland General Electric, which pays $3,578,943.43 on an assessed value of $234,823,000 — down nearly $4 million from last year; Gas Transmission Northwest, which pays $566,913.77 on $43,336,800; and Pacificorp, which pays $503,027.72 on $31,872,520.

Bright Wood Corp. is number four on the list, with a tax of $412,079.74 on an assessed value of $20,957,549 — down slightly from last year.

Rounding out the top 10 are Warm Springs Power Enterprises, Keith Investments/Manufacturing, Safeway, Burlington Northern Santa Fe Railroad, Union Pacific Railroad, and CenturyLink.

Property taxes are due at the Jefferson County Tax Office in the courthouse annex at 66 S.E. D St. in Madras by Nov. 15. Taxpayers who pay the full amount by the deadline will receive a 3 percent discount, while those paying two-thirds will see a 2 percent savings. Payments can also be dropped off in the curbside drop box on the east side of the annex.

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