When Hermiston and Pendleton residents received their property tax bills this week they might have noticed a new line on them for the cities’ urban renewal districts.
The good news is, they don’t actually owe more taxes — the line just represents a shift in accounting procedures. The bad news, according to Hermiston assistant city manager Mark Morgan, is it is causing some confusion from taxpayers who think they’re being charged a new tax by the city.
“The internal accounting of how revenues are collected and distributed has changed, but the total property tax bill that people owe is unchanged,” he said in a statement. “I think the intention is for transparency, but frankly it muddies the waters.”
He told the Hermiston Herald that he worried people would think the city had lied about citizens outside Hermiston’s urban renewal district not having to pay additional taxes for the urban renewal district. People’s taxes are still not going up to pay for the district, he said.
Urban renewal districts function by creating a baseline of property taxes within a certain district (downtown, in Pendleton and Hermiston’s case). During the life of the district, as property values rise, the “extra” taxes from that increase in values is skimmed off the top and diverted into projects designed to increase property values in the district further.
Paul Chalmers, director of Umatilla County assessment and taxation, said the change in the way the bill is presented comes from a ruling by the Oregon Supreme Court. It doesn’t change the amount of money people are paying — the amount would have shown up on their taxes anyway, divided between the different taxing districts that are giving up revenue to the urban renewal district. It also doesn’t change the amount of money that the urban renewal district receives.