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Special District White Paper <br /> (iw <br /> FUNDING URBAN SERVICES <br /> Background <br /> This paper studies several types of special districts that could provide urban -level services within <br /> the Eugene - Springfield metropolitan area. We do not look at all types of special districts nor do we <br /> attempt to answer all questions. Rather, we offer a range of useful information on types of special <br /> districts that could offer urban services now provided by the City of Eugene. This is a starting point <br /> for further analysis and discussion. <br /> Many city services are funded primarily with property tax revenue, which flows to the city's General <br /> Fund. Among important City of Eugene services relying in whole or in part on the General Fund are <br /> library, recreation, parks and open space, police, fire, and emergency medical services. Local <br /> property taxes are subject to constitutional, statutory, political and practical constraints. These <br /> revenue constraints are increasingly forcing city councils to make choices among important city <br /> services, reducing or foregoing some services in order to preserve or implement others. City <br /> residents will likely continue to expect improved and expanded urban -level services. In the face of <br /> the limited ability of the City to fund desired services, it is useful to examine alternative funding <br /> strategies. <br /> The Eugene City Council recognizes these needs in its adopted goal of Fair, Stable and Adequate <br /> Financial Resources. The applicable action priority under this goal is for a Review of the City role in <br /> provision of regional services. The adopted work plan for this item includes an analysis of the <br /> potential of special districts as a service delivery option. <br /> Measure 5 and Measure 50 <br /> With the passage of Measure 5 in 1990, a constitutional limit was placed on the total tax rate that <br /> 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. Oregon voters adopted <br /> another Constitutional amendment, Measure 50, in 1997. This measure reduced local government <br /> operating tax revenue by 17% statewide and rolled back property values for tax purposes to July 1, <br /> 1995 values, minus 10 %. It also made a clear distinction between real market value and assessed <br /> value, and required all local governments to have a voter - approved maximum property tax rate per <br /> $1000 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. If <br /> real market value is lower than assessed value, it becomes limit of taxable value. <br /> These measures significantly reduced local property taxes. However the ability of a city to provide <br /> desired ongoing services beyond what could be provided under a city's permanent rate limit was <br /> restricted to limited- duration local option levies with a maximum length of five years. Even with <br /> approval of a majority of voters, tax revenue could not be permanently generated beyond the level <br /> of revenue allowed by city's permanent rate limit. <br /> c <br /> Special Districts Paper - Final 11- 8- 01.doc Page 3 of 41 <br /> City Council Agenda page 27 <br />