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Special District White Paper — Draft for Internal Review <br /> FUNDING URBAN -LEVEL SERVICES <br /> Background <br /> This paper studies several types of special districts that could provide urban -level services <br /> within the Eugene - Springfield metropolitan area We do not look at all types of special districts <br /> nor do we attempt to answer all questions. We rather offer a range of useful information on <br /> types of special districts that could offer urban services now provided by the City of Eugene. <br /> This is a starting point for further analysis and discussion. <br /> Many city services are funded primarily with property tax revenue, which flows to the city's <br /> general fund. Among important City of Eugene services relying in whole or in part on the <br /> general fund are library, recreation, parks and open space, police, fire, and emergency medical <br /> services. Local property taxes are now subject to constitutional, statutory, political and practical <br /> constraints. These revenue constraints are increasingly forcing city councils to make choices <br /> among important city services, reducing or foregoing some services in order to preserve or <br /> implement others. Cit , residents wilrfi ckel'y contintieI4 expecUmproved and expanded urban - <br /> level services. In the face of the limitedbility oftheCity tp fund desired services, it is useful to <br /> examine alternative funding g strategies. ' J ' ; ! 1 . <br /> City road services do of depend on property taxes€an so are not constrained by provisions of <br /> Measures 5 and 50, b t these services�,are<,also facing rev constraints. The traditional <br /> sources of revenue fo City'of Eugene road=,o eration, Maintenance and preservation activity <br /> and capital projects h ve been/state highway fur ds endfederal timberifund transfers from Lane <br /> County. State highway u ansters have not kept pace With either inflation or population <br /> growth. Transfers of federal dollars under the County /City Roads Partnership Agreement have <br /> declined by 54% in the past five years. The Agreement is currently extended for only one year <br /> and transfers beyond FY02 are not assured. Due to these reductions in available funding, <br /> capital project funding for roads has been eliminated from the FY02 City budget. If additional <br /> revenue is not found the City road fund is facing projected operating deficits within a few years. <br /> The Eugene City Council recognizes these needs in its adopted goal of Fair, Stable and <br /> Adequate Financial Resources. The applicable action priority under this goal is for a Review of <br /> the City role in provision of regional services. The adopted work plan for this item includes an <br /> analysis of the potential of special districts as a service delivery option. <br /> Measure 5 & Measure 50 <br /> With the passage of Measure 5 in 1990, a constitutional limit was placed on the total tax rate f <br /> that could be levied on an individual property. This measure established a maximum general <br /> government tax rate of $10 per $1000 of a property's real market value. Measure 50 was <br /> subsequently passed, in 1997. This measure reduced local government operating tax revenue <br /> by 17% statewide and rolled back property values for tax purposes to 1991 -2 values, minus <br /> 10 %. It also made a clear distinction between real market value and assessed value, and <br /> required all local governments to have a voter - approved maximum property tax rate per $1000 <br /> taxable assessed value prior to levying a permanent operating levy. Assessed values are <br /> allowed to rise 3% a year, plus taxable new construction and annexed property assessed value. <br /> If real market value is lower than assessed value, it serves as an upward limit of taxable value. <br /> Draft #5 Page 3 10/24/01 <br />