Clackamas County / North Clackamas Parks and Recreation District (NCPRD) approved a budget that includes taxing Happy Valley residents. This comes after repeated promises in letters and website announcements that “Starting July 1, NCPRD will no longer be assessing its permanent district rate within Happy Valley.”
The City is monumentally disappointed with Clackamas County going back on promises it made to the City and its residents to honor the withdrawal from NCPRD and not tax property inside Happy Valley.
Not only is the City shocked by this latest development, it disputes a recent decision from the Department of Revenue to rescind its previous approval of the City’s withdrawal from NCPRD. The City was transparent throughout the process and all parties, including Clackamas County, were in agreement on the steps to withdraw. Only now at the 11th hour has the Department of Revenue, at the County’s request, inserted itself into the process and sought to direct the outcome.
The most concerning aspect of these actions is that they come on the heels of a local election in which the voters of Happy Valley overwhelmingly approved a levy to support City-run parks and recreation services. The City referred the levy to the voters with the understanding and promise from Clackamas County that it would not tax Happy Valley residents after July 1, 2018.
This most recent action illustrates once again the failure of NCPRD to listen to our residents. We are disappointed that our voters continue to be ignored.
We understand this reversal by the Department of Revenue will come as a surprise to many, as it was to us, and want to provide as much information as we can about how we got here and the potential impacts. Unfortunately, this stunning development opens more questions than we have answers at this time. Our commitment to you, our residents, is to keep you up to date as soon as we establish a path forward.
How did we get here?
Last June (2017), the City Council adopted an ordinance formally withdrawing the City from NCPRD. The decision to withdraw was one that wasn’t taken lightly and had been discussed for a couple of years within the community and by the City Council. For more information on the withdrawal, visit https://www.happyvalleyor.gov/ncprd-withdrawal-faqs.
What withdrawal process did the City follow?
It is important to understand that the City followed the process that Clackamas County Counsel advised it to follow. NCPRD was established by the County under Oregon Revised Statute Chapter 451. In that same chapter, the statute directs cities that wish to withdraw from such districts to follow a process outlined in ORS 222.524. This is the process the County identified, and the City followed, including notice to residents and a public hearing. Leading up to the decision and during the public hearing, the Council received comments from many residents who urged the City Council to withdraw from NCPRD.
After the withdrawal ordinance was adopted, Clackamas County and the Department of Revenue took steps acknowledging the City’s authority to withdraw and the process the City followed. The County Administrator specifically acknowledged the City’s withdrawal in writing and promised to “not stand in the way.” The County also committed to not collect taxes on behalf of NCPRD inside the city limits. Below are just a few of the examples of the affirmation the City received regarding the process.
- April 2017: Clackamas County Counsel advised the City to use the withdraw process the City then followed.
- May 2017: Clackamas County NCPRD Director wrote a letter suggesting they would work to “support a smooth transition.”
- May 2017: Clackamas County Board Chair Bernard wrote a letter acknowledging the decision to withdraw was up to the “City’s discretion.”
- June 2017: Clackamas County wrote a letter to the City acknowledging the City’s withdrawal stating that NCPRD would “not stand in the way.”
- November 2017: Clackamas County sent a mailer to every household in Happy Valley informing them that the City had withdrawn from NCPRD.
- November 2017: Clackamas County admitted in Circuit Court that Happy Valley properly followed the withdrawal process and NCPRD “cannot assess property within Happy Valley” for taxation purposes.
- March 2018: Oregon Department of Revenue approved the boundary change withdrawing the City from NCPRD for property tax purposes.
- March 2018: Clackamas County elections officials approved the City’s parks levy ballot language which stated the City was no longer part of NCPRD.
- April 2018: Clackamas County posted on its website that “Starting July 1, NCPRD will no longer be assessing its permanent district tax rate within Happy Valley.”
- April 2018: Clackamas County sent an email blast to district residents informing them that Happy Valley residents would be charged out of district rates and will have second priority for registration.
- April 2018: Clackamas County’s lawyer sent a letter stating that they agree Happy Valley had formally withdrawn for assessment and taxation purposes.
- May 2018: Clackamas County filed another pleading in Circuit Court which again admitted the City had properly withdrawn from NCPRD and they couldn’t collect taxes.
- June 2018: Clackamas County Clerk certified Happy Valley’s parks and recreation levy election results with 72% approval.
Only now is the Oregon Department of Revenue rescinding its approval of the boundary change, after months of input from residents, public hearings, promises made by Clackamas County to not tax Happy Valley residents. The City has been moving forward to develop a parks and recreation program on the basis of these events – including asking for voter approval to fund City parks. It’s frustrating, to say the least, that this is only surfacing at the eleventh hour.
What does this mean for my taxes?
As recent as this April, Clackamas County promised on its website that NCPRD would not tax Happy Valley residents. With this decision, it appears Clackamas County is reversing that promise. The City will share more information about potential tax impacts as it learns more.
Will we be charged in-district rates for NCPRD programs?
This spring, Clackamas County sent an email blast to district residents informing them that Happy Valley residents would be charged out of district rates and will have second priority for registration. At the same time, the City had been in the process of developing its own recreation programs. However, this recent decision creates significant uncertainty. If NCPRD elects to tax Happy Valley residents, it is the City’s position that our residents are eligible for in-district rates.
If you have any questions regarding this matter, please contact Ben Bryant, Assistant City Manager, at firstname.lastname@example.org or phone (503) 783-3840.