In a bi-partisan vote. the Oregon legislature passed and Governor Kotek signed HB 3194, which is viewed to help businesses and control inflation. The bill allows remodeling or construction projects at today’s costs without running into the caps that trigger a re-evaluation of value for property tax purposes.

HB 3194, sponsored by Representative E. Werner Reschke (R-Crater Lake), changes the current fixed cap from $10,000 per year to $18,200 per year, and from $25,000 over a rolling five-year period to $45,000. It further allows the caps to be increased based on an increase in the CPI. The assessment year begins January 1, 2024.

Oregon voters placed limits on property taxes in the Oregon Constitution in 1990 with the passage of Measure 5, modeled after California’s Proposition 13. Voters were frustrated by the increase in property taxes attributed to rapidly rising property values, mostly in the Portland area at that time.

A D V E R T I S E M E N T

A D V E R T I S E M E N T

The Oregon tax revolt is a political movement that is an ongoing campaign for lower taxes. The tax revolt has, in large part, been by a series of citizen's initiatives. The caps on property taxes didn’t stop the increase in property values bringing in higher tax bills. This led to Measure 47 in 1996, which capped the annual rate at which property taxes could rise. Measure 47 also adopted Oregon's double majority rule, in which local tax levies could only pass in minor elections when voter turnout surpassed half of the registered voters.

The Committee to Unleash Prosperity says every state needs a property tax limit. A new study by Laffer Associates and CTUP shows the damage of property taxes. When property taxes rise, home values fall because the higher taxes get capitalized into the value of the house.

The table shows where property taxes are highest and lowest across the U.S. with an average tax rate of 0.99%. The effective property tax rate in Oregon is 0.82%, currently ranking 23rd highest in the country. However, specific tax rates can vary drastically depending on the county and city. The caps have succeeded in keeping property taxes far lower than if they rose in sync with home values. However, limiting property taxes has caused other taxes to be implemented or rise.

Government unions like to say that high property taxes are associated with better public services and schools, but that doesn’t bear out. If you look at the states on the extreme ends, quite the opposite is true. Oregon implemented the CAT tax to subsidize the lack of property tax, which likely impacts low-income families more than a property tax. Still they claim our schools are underfunded.

Oregon’s May 16 special election should send a strong signal to government officials. Multnomah County voters said a resounding “no” to a proposed capital gains tax

Salem City Council squeezed out a capital improvements bond measure of $300 million last November by saying the tax will simply replace a bond that has been eliminated. Now they are proposing to implement a new employee tax without voter approval that is causing a revolt. The Council blames this tax on their lack of being able to raise property tax rates. Isn’t the point of a limitation to halt spending? Salem’s Council might consider the cause of the revolt isn’t the source of the proposed tax, but it’s the rich appetite for spending.


--Donna Bleiler

Post Date: 2023-08-10 11:00:01

Last Update: 2023-08-09 17:33:05