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Special District White Paper — Draft for Internal Review <br /> Limitations on District Property Taxes <br /> Altogether, seven interacting constitutional, statutory, practical or political limitations determine <br /> tax rates and the maximum amount of property taxes that may be levied and collected by a local <br /> government including a special district. <br /> Constitutional Limitations <br /> 1. The constitutional maximum general government tax rate limit is a legal limit on the total <br /> taxes that may be levied on any individual property by all general government taxing <br /> jurisdictions, including city, county and special district tax levies. <br /> 2. The Constitution also requires the voters for each taxing district approve an individual <br /> permanent maximum property tax rate limit for the district before it may levy property taxes <br /> X for operations. This approved maximum tax rate limit becomes the specific legal limit for the <br /> individual district. <br /> Principal Act Limitations <br /> 3. A special district's principal Act usually, but not always, specifies an absolute limitation on <br /> X the amount of property fax revenue that may be collected annually by that type of district. <br /> Regardless of the p rp oved m ximurrilax rate limit, the individu Fdistrict May not collect an <br /> amount greater th n the atoant specifi ally}alloWed in the district's principal Act. <br /> Practical Limitation ' ; i __ ' 1 <br /> ) <br /> 4. Recognition of pro erty value fluctuations n�' l w <br /> loarce of property value headroom <br /> beneath real mark t value hrnitatiohs to a , ommodate volatility in Ibcal property values is a <br /> wise policy and a practical Irmitation\ <br /> t _ <br /> 5. Allowing additionatheadroom for special, /evicts by any local general government jurisdiction <br /> is also good policy. This allows voters to approve`local option levies for special purposes <br /> without triggering compression of property tax revenue. <br /> 6. Property tax collections are always somewhat less than the amount levied. Currently in <br /> Eugene - Springfield, about 93% of levied taxes are actually received by the taxing <br /> jurisdiction. This is due to delinquent payments and tax compression. <br /> Political Limitations <br /> 7. The voters under the constitutional double majority rule must approve all new property tax <br /> X proposals put forward by a special district. <br /> Constitutional General Government Tax Rate Limit <br /> A significant part of 1990's Measure 5 is the total maximum general government tax rate limit <br /> that any property may be subject to. Subsequent passage of Measure 50 in 1997 specified that <br /> property taxes are to be calculated on a property's assessed value rather than its real market <br /> value. <br /> Special districts are subject to these constitutional limitations. A special district's property tax <br /> levies are considered to be general government taxes, and are included when calculating <br /> whether the total property taxes levied by all general government jurisdictions on a particular <br /> property exceed the constitutionally permitted maximum. If the total general government <br /> operating tax rate exceeds that cap, property tax revenue compression will occur and revenue <br /> received by each taxing district will be proportionately reduced. Article XI, Section 11 b of the <br /> Oregon Constitution sets the maximum total property taxes that may be levied and collected <br /> Draft #5 Page 12 10/24/01 <br />