1978 October
78 EM
27
discrimination. without p.ople, all to equally them offers and programs it. in participation invitas Extension
counties. Oregon and Agriculture, 01 D.partmani S. U. the University, State Oregon of program coop.retive
a I. work Extnsion 1914. 30, Jun. and May of Congr.aa of Act, th. of furth.rance in dietributsd and duced
pro- was publication This dir.ctor. Wadsworth, A. H.nry Corvallis, Univ.raity, Stat. Or.aon S.rvic., Ext.n.ion
I
SERVICE
EXTENSION
OREGON
UNIVERSITY STATE
homesteads.
farm on taxes of half pay
would state that except tem,
sys- present from change No
year. per cent
per- 2 plus value market 1975
b) or value use farm a) of
lesser at assessed be would
farmland assessed Specially
value. assessed times bonds,
existing for amounts plus
value, assessed of $1000 per
$15 to limited taxes Property
value.
use farm at assessed lands
farm- Certain value. assessed
times rate tax to equal Taxes
FARMERS
HARRP.
in change for provision No
taxes. for
paid rent of portion the of
one-half to equivalent fund
re- a renters pay would State
$1500. of payment
maximum a to up residences
principal occupied owner on
levied taxes the of half pay
would state the Generally,
HARRP.
in change for provision No
relief. direct additional No
value. assessed duced
re- usually the times bonds,
existing for amounts plus
value, assessed of $1000 per
$15 to limited taxes Property
$16,000. than less of
incomes with renters to fund
re- $328 to up provides HARRP
taxes. pay to landlord by used
rent of Portion taxes. ty
proper- direct no pay Renters
$16,000. than less of comes
in- with homeowners to refund
$655 to up provides (HARRP)
Program Relief Renters and
Homeowners property. of value
assessed times rate tax mined
deter- locally to equal Taxes
RENTERS
HOMEOWNERS
SYSTEM PRESENT
MEASURE
6
11 MEASURE
PAYMENTS TAX PROPERTY 1.
SYSTEM TAX
OREGON'S AND 11 MEASURE 6, MEASURE
University. State Oregon Economics, Resource and Agricultural of Department
Assistant, Research Savage, John and Economist, Extension Weber, Bruce by Prepared
nues.
reve- state unspent return to
provision specific no is There
biennium. next the
into carryover would surplus
this of None payments0 tax
income their to proportion in
taxpayers to refunded be would
funds surplus of amount total
the more, or percent 2 by
appropriations exceed revenues
operating general state When
loans. new of
issuance the slow would That
loans0 state for available
be would money less base,
1975 a to back rolled be
would value assessed Because
1980. during slowed be would
loans new of issuance base,
1979 a at frozen be would
1980 in value assessed Because
Oregon. in value sessed
astotal the of percentage
a to limited generally is
loans Farm and Home Veterans
the as loans such issue to
ability its therefore, and,
capacity bonding state's The
nues.
reve- state unspent return to
provision specific no is There
BONDS
SURPLUS
programs. state existing for
funding reduce could and grams
pro- new for spending duce
re- probably would 11 Measure
relief.
tax property as renters and
homeowners to revenues tax
income personal state return
to constitution state the by
mandated be would state The
limit0 this from
exempt be would governments
local by reimbursements and
service, debt relief, renter
and homeowner Mandated years.
2 previous the in Oregon
in income personal of rate
growth the to limited be would
spending fund general State
permitted. be would
increases tax "automatic"
system, present the under As
approval. of vote two-thirds
a without biennium previous
spending. on limit overall No
prohibited. be would perty
pro- of value or transfer on
taxes New system. present
under as permitted, be would
increases tax "Automatic"
revenues. in receives it than
more spend not may state The
spending. on limit overall No
SPENDING
legislation. additional
without increase, lation
popu- and income personal as
"automatically" increase can
taxes state other and taxes
income from revenue total The
MEASURE 6
MEASURE 11
Property taxes limited to $15
per $1000 of assessed value,
plus amounts for existing
bonds, times the usually reduced assessed value.
No change from present sysNo direct relief protem.
vided by state.
Property would be assessed at
1975 values plus 2 percent per
year. Newly constructed, purchased or transferred property
would be assessed at market
value at time of change.
In 1980, the assessed value
of property would be frozen
at 1979 levels. Otherwise,
it is the same as the present system.
Property taxes would be shared
on the basis of 1975 market
value and length of ownership.
Taxes would continue to be
apportioned among property
owners on the basis of the
current market value of
property, except during
1980 when it would be apportioned on the basis of
1979 market values.
PRESENT SYSTEM
BUSINESS!
INDUSTRY
Taxes equal to tax rate times
assessed value.
2. ASSESSMENT SYSTEM
ASSESSMENT
OF PROPERTY
APPORTIONMENT
OF TAXES
With certain exceptions, property in Oregon is now assessed at its true cash value,
the price a willing buyer
would pay a willing seller.
Property taxes are generally
shared among the property
owners in direct proportion
to the current market value
of their holdings.
Owners of recently constructed,
purchased, or transferred property would pay a higher share
of taxes than owners of similar
properties that had not been
recently constructed, purchased
or transferred.
The 1979 legislature would
"review, study, and revise
as neces 5ary" existing assessment laws and practices0
3. LOCAL GOVERNMENT
REVENUES
For local governments with
voter approved tax bases,
the tax levy may increase
6 percent each year without
Tax levies
voter approval.
outside the 6 percent limitation must be approved by
the voters.
For local governments without tax bases, all property
tax levies must be approved
by voters.
SPENDING
BONDS
No overall limit on local
spending. Local governments
cannot spend more than they
receive in revenues0
Voters approve most local
bond measures.
Local governments can guarantee repayment of certain
bonds through their power
to levy taxes on property0
In addition to limits in the
present system, 3 new restrictions would be placed
on local taxing power: (1)
Because of the 1.5 percent
limitation, maximum local
tax rates for individual
governments would probably
be determined by the state
government. This would
limit property tax revenues.
Voters could not approve
property tax levies above
that limit. (2) New taxes
based on the value or sale
of property would be prohibited. (3) Special taxes
may be created only with
approval of two-thirds of
qualified voters0
In addition to limits in the
present system, expenditures
funded by property taxes
could not grow faster than
the rate of population growth,
adjusted by a price change
index. Voters could approve
taxes beyond this limit. This
limit could not be less than
that allowed under the 6 percent limitation.
No overall spending limit.
No overall spending limit.
The reduction in property
taxes would result in a reduction in local spending
and services, or some increase in local non-property
tax revenues unless the state
or Federal government increased their funding to
local governments.
The effect on local spending
would depend on the response
of local governments and
voters to the new limit on
expenditures funded by property
Local governments could not
make the same guarantee of
repayment of bonds under the
The
1.5 percent limitation.
capacity of local governments
to sell bonds would be im-
No direct effect.
The state generally would not
share payment of the additional property taxes beyond
these limits, even if voters
approved such taxes.
The effect on local revenues
would depend on the response
of local governments and
voters to this new limit.
taxes0
paired.
4. STATE GOVERNMENT
REVENUES
Generally, a simple majority
vote of the Oregon legislature is needed to enact any
law increasing existing state
taxes or creating any new
state tax.
A two-thirds vote of the Oregon legislature would be
needed to enact any law increasing existing state taxes
as sources of revenue.
The state legislature could
not enact any tax measure
increasing revenues from a
tax category (such as income
tax, cigarette tax) by 5 percent or more from the pre-
SPENDING
The total revenue from income
taxes and other state taxes
can increase "automatically"
as personal income and population increase, without
additional legislation.
"Automatic" tax increases
would be permitted, as under
present system. New taxes
on transfer or value of property would be prohibited.
previous biennium without a
two-thirds vote of approval.
No overall limit on spending.
The state may not spend more
than it receives in revenues.
No overall limit on spending.
State general fund spending
would be limited to the growth
rate of personal income in
Oregon in the previous 2
years. Mandated homeowner and
renter relief, debt service,
and reimbursements by local
governments would be exempt
from this limit0
As under the present system,
"automatic" tax increases
would be permitted.
The state would be mandated
by the state constitution to
return state personal income
tax revenues to homeowners
and renters as property tax
relief.
Measure 11 would probably reduce spending for new programs and could reduce funding
for existing state programs.
SURPLUS
BONDS
There is no specific provision
to return unspent state reve-
There is no specific provision
to return unspent state reve-
nues.
nues.
The state's bonding capacity
and, therefore, its ability
to issue such loans as the
Veterans Home and Farm loans
is generally limited to a
percentage of the total assessed value in Oregon.
Because assessed value would
be rolled back to a 1975
base, less money would be
available for state loans0
That would slow the issuance
of new loans.
When state general operating
revenues exceed appropriations
by 2 percent or more, the
total amount of surplus funds
would be refunded to taxpayers
in proportion to their income
tax payments0 None of this
surplus would carryover into
the next biennium.
Because assessed value in 1980
would be frozen at a 1979
base, issuance of new loans
would be slowed during 1980.
Prepared by Bruce Weber, Extension Economist, and John Savage, Research Assistant,
Department of Agricultural and Resource Economics, Oregon State University.
MEASURE 6, MEASURE 11 AND OREGON'S
TAX SYSTEM
1. PROPERTY TAX PAYMENTS
MEASURE 11
PRESENT SYSTEM
MEASURE 6
HOMEOWNERS
Taxes equal to locally determined tax rate times assessed
value of property. Homeowners
and Renters Relief Program
(HARRP) provides up to $655
refund to homeowners with incomes of less than $16,000.
Property taxes limited to $15
per $1000 of assessed value,
plus amounts for existing
bonds, times the usually reduced assessed value.
Generally, the state would
pay half of the taxes levied
on ownr occupied principal
residences up to a maximum
payment of $1500.
RENTERS
Renters pay no direct properPortion of rent
ty taxes.
used by landlord to pay taxes.
}IARRP provides up to $328 refund to renters with incomes
of less than $16,000.
No additional direct relief.
State would pay renters a refund equivalent to one-half
of the portion of rent paid
for taxes.
No provision for change in
HARRP.
No provision for change in
HARRP.
FARMERS
Taxes equal to tax rate times
assessed value. Certain farmlands assessed at farm use
value.
Property taxes limited to $15
per $1000 of assessed value,
plus amounts for existing
bonds, times assessed value.
Specially assessed farmland
would be assessed at lesser
of a) farm use value or b)
1975 market value plus 2 percent per year.
No change from present system, except that state would
pay half of taxes on farm
homesteads.
OREGON STATE UNIVERSITY
EXrENSIOI1
LJ SERVICE
Extension S.rvic., Oregon Stat. University, Corvallis, H.nry A. Wadsworth, director. ThIs publication was produced and distributed in furth.rance of the Act, of Congress of May S and Jun. 30, 1914. Extension work I. a
cooperative program of Oregon State University, the U. S. Department of Agriculture, and Oregon counties.
Extension invite, participation in its programs and offers them equally to stl p.opl., wIthout discriminatIon.
EN 78: 27
October 1978