Summary: The City of St. Paul is faced with a variety of pressing issues including land use, development, and public utility infrastructure and resource protection. At the present time, these issues are being addressed by one full time employee, limited consultant assistance, and volunteer citizen efforts. The existent permanent tax rate is insufficient to fund services necessary to adequately address these issues and run the City. The proposed measure would fund a City Recorder, Administration, land use planning, public works, engineering and legal services, and other necessary services to permit the city to more adequately respond to these matters. If this measure is approved it is estimated that approximately $41,935.00 will be raised in each year that the local option tax will be imposed.

This measure is subject to the limits of section 11b, Article XI of the Oregon Constitution. The revenues raised will be for government purposes other than schools. Approval of this measure will cause property taxes on St. Paul properties to exceed the limits of Article XI, section 11 (g)1 and (2)(a) of the Oregon Constitution.

Explanatory Statement:

The requested two-year local option tax will add $2.50 per $1,000 assessed value to the City’s permanent tax rate. This tax revenue would go into St. Paul’s General Fund.

What is the General Fund?

The General Fund pays all city expenditures not covered by the City’s Sewer, Water, or Street Funds, including such services as police, administration, finance and payroll, land use planning and growth management. Sewer, Water, and Street Funds may only be used to pay for projects or services related to providing sewer, water and streets for St. Paul. Anything else must be paid for out of the General Fund.

Why does St. Paul need additional General Fund Revenue?

Measure 50 caps assessed valuation increases at three percent (3%) per year. The City of St. Paul is facing a variety of very complex issues relating to such matters as development, police services, long range planning. The City is legally required to carry out these functions. These issues are currently being funded by the existing local option tax, which expires June 30, 2001. The City’s current Permanent Tax Rate under Measure 50 provides insufficient resources to adequately address these issues and run the day-to-day business of the City.

How much tax revenue does St. Paul currently collect?

The permanent tax rate for the City is set at $0.61 per $1,000 of assessed value. This generates approximately $10,328 each year. There are 2 temporary tax levies currently in place. One of these is a bond measure for $2.0189 per $1,000.00 assessed value. The current local option tax providing revenue for the General fund is set at $2.50 per $1,000 assessed value. This provides the city with approximately $41,935 for the General Fund annually, but expires on June 30, 2001. The total property tax rate for the City of St. Paul is $5.1346 per $1,000 assessed value. This will change by zero percent (0%) if the requested levy of $2.50 is adopted.

What should citizens know about the requested local option tax?

Under current law, the City cannot increase its permanent tax rate. It may ask voters to approve temporary tax measures. The revenues from the measure must be put into a separate fund and can only be used for the purpose stated in the measure. If the recommended measure were approved now, the City would collect the first year’s revenues in fiscal year 2001-2002. This would allow the City to operate without a gap in funding.

Submitted by:

Tom Kirk, Mayor

St. Paul City Council

No arguments in favor of or opposed to this measure were filed.