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1990-13077-Minutes for Meeting May 02,1990 Recorded 5/10/19901.01 - 000 90-130'7'7 MINUTES DESCHUTES COUNTY~'.OF COMMISSIONERS May 21990. Chair Throop called the meeting tq..order - at 10 a.m. Board members in attendance were Dick Maudlin, Tom Throop and Lois Bristow Prante. Also present were Rick Isham, County Legal Counsel; Larry Rice, Public Works Director; Jerie Schutte, Purchasing Agent; Brad Chalfant, Property Management Specialist, and Mike Maier, County Administrator. 1. CONSENT AGENDA Consent agenda items before the Board were: #1, reappointment of Majorie Smith to the Historic Landmarks Commission; #2, appointment of Billie Laumer to River Forest Acres Special Road District Board of Directors; #3, appointment of Karen Grimm to Vandevert Acres Special Road District Board of Directors; #4, approval of Amendment #12 to 1990-91 Mental Health Intergovernmental Agreement; and #5, signature of Development Agreement for the Mayfields. PRANTE: Move consent agenda MAUDLIN: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 2. PUBLIC HEARING: RESOLUTION 90-030 ADOPTING CENTRAL OREGON REGIONAL STRATEGY Commissioner Prante said that the Central Oregon Regional Strategy Committee of Seven received many more requests than there was money available. She said the committee struggled long and hard before making their final recommendations which, if approved by each county commission, would be submitted to the Economic Development Department for approval and funding. She said they requested a tiny bit more money than was allocated but felt they had submitted quality proposals which should be approved. Chair Throop opened the public hearing and asked if there was anyone from the audience who wished to testify. No one wished to testify, so chair Throop closed the public hearing. PRANTE: I would move signature of the resolution. MAUDLIN: I'll second the motion. PAGE 1 MINUTES: 5/2/90 ~OfIIMED 5 101 - 0086 VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 3. TAX REFUND CLAIM ON SQUAW CREEK CANYON RECREATION ESTATES Before the Board was a request from Ron Remund for a tax refund on a portion of the taxes paid on his property in the Squaw Creek Canyon Recreational Estates, Inc. due to an error made by a county appraiser. Rich Isham said that the Board had met with Louis Dvorak, attorney for Ron Remund, and the County Assessor and his staff a week ago. He said the argument that Mr. Dvorak made to the Commission at that time was that the Commission had erred in canceling a refund under ORS 311.205(1)(a) because they were preceding under the authority of ORS 311.205(1)(c) where it said "the officer may correct any other error or omission of any kind so long as not to change the valuation judgment." Rick Isham said that statute cited three kinds of errors which were contemplated in that section. He said the Board asked him to review that section and give them an opinion as to whether or not the term "any other error" would include the appraiser's incorrect observation and belief that utilities were in a portion of the subdivision where it appears they were not. He submitted the attached report. Commissioner Prante said they were taxed on having utilities which weren't there, and she felt the money should be refunded. Commissioner Throop asked if there was a legally defensible provision in state law that would allow the refund? Rick Isham said it was his opinion that there was no authority for the County to do that. He said there wasn't unfettered discretion in the statute to correct every error within the tax system. He said a lot of the burden under the tax system was placed upon the taxpayer to file appeals in a timely manner. In this case, a person acquired the company that owned a majority of property after the fact. He said the current property owner was saying he didn't have an opportunity to file those appeals because he was not the property owner at the time, although he did in fact pay the taxes. Rick Isham said that whoever was the owner or taxpayer at that time had the opportunity to appeal for each of the years in a timely manner, but did not. Louis Dvorak, attorney for Ron Remund, said Mr. Remund was the sole shareholder of Squaw Creek Canyon Recreational Estates and current owner of the property. He said the ownership of the property during the years under discussion PAGE 2 MINUTES: 5/2/90 iot - Q08? (tax years 1983/1984 through 1985/1986) was in a joint venture which included Stanley J. Hafer who had the power of attorney for the rest of the joint venture. Mr. Remund was a member of the joint venture, and his job was to develop the property, i.e. zoning permits, plat, improvements, and he was to get reimbursed for his expenses by the other members of the joint venture. He eventually paid the taxes personally in order to avoid losing the entire project to foreclosure. Commissioner Maudlin asked if the field appraiser had stated that when he appraised the property, he was assuming the utilities were in on all of the lots? Mr. Dvorak said that there was a map in the Assessor's records showing the area of the subdivision indicating lot values for each lot with an arrow going from lot to lot indicating that they all had the same value. He said normally, if the utilities were not in, there would be a notation on the map that said "cost to develop" showing the amount the owner would have to pay to make the lot habitable. That value was obtained independent from viewing the lot by calling the utility company. That value would then be deducted from the value of the lot found by appraisal. Commissioner Maudlin asked if the lots with utilities and the lots without utilities were all appraised at the same value? Bob Greenstreet from the Assessor's office indicated they were. Commissioner Maudlin asked if there was any kind of protest at the time that the assessed values were sent out. Mr. Dvorak said that the tax notices went to Mr. Hafer as attorney for the group of owners. When Mr. Remund checked to see if the taxes had been paid and found that they hadn't. He made an independent inquiry as to what the taxes were, and then paid the taxes. Mr. Dvorak gave the Board a copy of the law he felt was pertinent to the case. He felt the critical language was that the "Assessor can correct any other error or omission so long as it's not a change in value judgement and such errors include, but are not limited to, elimination of assessment." He said this was a general statement and that examples were not meant to limit the general phrase that went before. He said in this case, there was the problem of property that had off-site improvements that had a value. The value of the utilities could not be seen by looking at the utilities, but had to be determined by contacting the utility to see what the expense was to make the lot habitable. He said this was a lot different than going to someone's house and measuring the square footage inaccurately since the house might be worth just as much if it were smaller because the construction might be better. He said here there were looking at an expense that the user of the property had to pay someone else to make the PAGE 3 MINUTES: 5/2/90 101 - 0088 property usable. He said there was an additional problem created if the refund was denied in that Mr. Remund was only seeking the same treatment as his neighbors got which was a refund. Commissioner Throop asked why Mr. Remund's neighbors would have gotten a refund, and Mr. Remund would not. Rick Isham said there were other lot owners in the area who received refunds due to "clerical error" which were initiated by the Assessor's office. When this refund came through, it was stopped. Louis Dvorak said that this refund should be granted as a result of a simple subtraction of an expense that could be determined independently from an appraisal of the lot itself. He felt that in granting the refund, the Assessor was not exercising valuation judgment which was prohibited. He was just making a mechanical subtraction based on a cost that could be ascertained by phoning a utility company. Commissioner Maudlin asked how much the refund would be. Mr. Dvorak said the original amount was $14,445.11, then there were taxes that were paid for later years on lots that closed which he added, plus interest, making a total claim of $22,227.07. He said there was a question as to whether the refund for 83/84 was available, and if it wasn't, that would deduct $6,204.16. Rick Isham said there would be an additional year's interest because of the length of the litigation. However, Mr. Remund had said he would be satisfied with the refund on the same basis as his neighbors. Rick Isham said there was a large increase in the number of "clerical error" refunds being processed, and this one, because of the large amount, was brought to his attention. He reviewed it and had a difference of opinion. The Board ultimately canceled the refund. Some of the property owners in the area had already received refunds incorrectly by this time. Oscar Bratton, County Assessor, said there was a refund filing limitation which was five years past the last assessment roles. His main concern was because the County had listed and assessed something that physically did not exist on the property. He said it had always been a policy of his office that if it could be documented and proven that they had assessed something that didn't physically exist, the error would be corrected, the excess property taxes refunded, and the tax reduced. He said usually when they appraised a subdivision, they looked at the cost of the bare land plus the improvements. In this case, they erroneous showed that the utilities were there when they weren't. The appraiser saw utilities on one end of the subdivision and on the other end and assumed that the line had been put through the PAGE 4 MINUTES: 5/2/90 1011 - 0089 subdivision. Commissioner Maudlin asked if his refund policy was backed up by state law or if it was just a policy in his office? He said the limitation allowed him to go back five years. The Department of Revenue could only go back 2-3 years. He said at the time this refund was started, it was within the 5-year limit. Bob Greenstreet said it was inspected in 1981 for the 1/1/82 assessment date. Commissioner Throop asked if Mr. Bratton's policy conformed with state law. Oscar Bratton said they had asked for guidance from the Department of Revenue and from the Attorney General's office as to where the line was between a clerical error and a judgment error. No decision had come through yet. Jim Willis said the Department of Revenue was in the process of rewriting some administrative rules to address this problem. Commissioner Maudlin asked if the rules would be retroactive. Mr. Willis didn't know. Oscar Bratton said that when he called Scott Phinney, Chief Hearings Officer for the Department of Revenue, he agreed that this was a correctable error, and they proceeded on his advise. Later on there seemed to be a lack of consensus within the Department of Revenue about what was the correct thing to do. Commissioner Prante: I'm ready to make a motion that we grant the refund. Commissioner Maudlin: I'll second it for discussion. Commissioner Prante said the county taxed something that didn't exist, and that it was right and fair to refund those taxes. Commissioner Maudlin said he didn't want to compound the error. He said he felt there was an error made but was not ready to make a decision until there was an opportunity to take a closer look at the figures involved. Commissioner Throop said his view was that the State was very prescriptive in the administration of tax law, and that unless the County had some statement from the Department of Revenue or the Department of Justice that this was not a valuation judgment but another kind of error or omission which was refundable, he was not comfortable supporting a refund. He felt the Board should follow Legal Counsel's advise until they got a clarification from the State. Commissioner Maudlin said he concurred with Commissioner Throop. Commissioner Prante retracted her motion. Commissioner Maudlin asked the Assessor to press the Department of Revenue to get an opinion. Commissioner Throop asked that Legal PAGE 5 MINUTES: 5/2/90 101L - [090 Counsel also write a letter to the Department of Revenue for the Board's signature. If the response from these inquiries was different than the advise already received from County Legal Counsel, then the Board could reconsider the question. Rick Isham said the Board could file a petition for a Declaratory Ruling, however the Department of Revenue did not have to render a decision. 4. UPGRADE OF AT&T TELEPHONE EQUIPMENT Jerie Schutte reported that the County's current telephone system was full and an upgrade was needed to be made to add more incoming and outgoing lines. She said the $29,000 portion of the upgrade from System 75 Version 2 to Version 3 would increase extension capacity from 223 to 675. It would also allow an increase in incoming and outgoing lines from the current 18 to as many as 40. The new system would support the Audix System in which many departments had shown an interest. Suzie Penhollow, Clerk, said the Audix-voice Mail system would be helpful for getting out election information, especially the recorded message part of the system. People could call in after hours and get voter or marriage license information. She said the $1,000 cost was in her budget request. Sue Stoneman, Community Corrections, said the new system would help with the volume of calls they received. They currently needed one full-time clerical just to answer phones and take message. She said that could be cut in half by the use of an Audix system. This would offset the need to hire more clerical staff. Karen Green, Community Development Director, said they could use every feature of the Audix system and felt it would result in a savings. She said they had 2-1/2 positions working the phones, and this system should eliminate the need for the 1/2 position and would provide better service to their customers. A lot of information could be given out with recordings and eliminate the need to speak to someone in the office. They would use automatic messaging within the department. She said they had not put anything in their budget for this system, however, was told it was included in their 10% administrative transfer. Pat Metelski from the District Attorney's Office said it would help their office also. She said the amount of time to take the calls and write the messages to the staff would be cut considerably. Commissioner Throop asked if the $64,000 was a one-time capital equipment cost as opposed to ongoing operational costs. Jerie Schutte said it was all capital equipment costs, PAGE 6 MINUTES: 5/2/90 101 - 0001 but there would be a increase in maintenance costs after the first year. Mike Porterfield, Office Manager of the Deschutes County Sheriff's Department, said he had someone working 40 hours a week answering the telephone and the entry of arrest warrants. He said she had to work four hours overtime every week because she hadn't had time to enter the arrests. This system would give her some relief. Larry Rice, Public Works Director, said it would help them in a couple of ways. He said it would free up time for other work to be performed by the receptionist, plus they needed the capacity expansion. He said it would help especially in the winter months for messages to the public. He said Public Works would financially support the system with their share of the costs. Ralph Delamarter, Librarian, said he could see many potential benefits for the Library and felt it would be a good move. Jerie Schutte said that AT&T would provide staff training on the Audix system. Mike Maier said $90,000 for the system was in the proposed budget ($70,000 for upgrade and $20,000 for ongoing maintenance). With some financial help from Public Works, he felt the County should be able to fund what the departments need. MAUDLIN: I would move that we accept AT&T upgrade and the audio voice mail program, and we will put it into the budget for approval. PRANTE: I would second that. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 5. BUSINESS REVOLVING LOAN TO PHIL HATCH, CENTRAL OREGON RECYCLERS Before the Board was approval of a business loan to Phil Hatch, of Central Oregon Recyclers. PRANTE: Move approval. MAUDLIN: I would second the motion. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES PAGE 7 MINUTES: 5/2/90 10 x. 0092 6. RESOLUTION 90-032 DECLARING INTENTION TO TRANSFER PROPERTY TO THE CITY OF BEND Before the Board was signature of Resolution 90-032 declaring their intention to transfer property to the City of Bend. A public hearing would be held on May 23, 1990, to hear any objections to the transfer. PRANTE: I would move signature. MAUDLIN: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 7. COUNTY GRAZING LEASES Brad Chalfant said that the county currently had 16 properties being leased for grazing which totaled approximately 1,700 acres. He said he and an OSU Extension Agent visited the sites and the Extension Agent prepared recommendations for the management of each of the parcels. He said future leases would include specific recommendations and requirements for management of the property to maintain the quality of grazing for livestock and wildlife. Some properties would be withdrawn from grazing for a year to allow the grasses to regenerate. He said there had been a request to purchase one parcel. He felt that because of it's unique location and access problems, it should be sold. Any sale would have to be by auction, but Rock Springs Guest Ranch had the only access to the property. Commissioner Maudlin said they should look into the cost of getting access to the property which might make it more valuable. Brad Chalfant said this property needed active management which the County neither had the interest nor the money to do. Commissioner Maudlin said he felt that the grazing leases should be terminated on the sale of the property. He felt that if the county had an opportunity to sell some property and get it back on the tax roles, the County should be able to terminate the grazing leases immediately. Brad Chalfant said that BLM had expressed interest in a number of the properties, and there could not be existing leases on them if they were to be traded to BLM. Brad agreed that the leases should be terminated at the time of the sale. Commissioner Throop said there may be property involved that would have other values that were so high (i.e. wildlife or potential trade with BLM) that the County would not want to sell the property. PAGE 8 MINUTES: 5/2/90 101 - 0093 MAUDLIN: I would move that we take the recommendations that Brad has brought to us with the changes and thoughts that we have expressed here, and bring it back to us for approval. PRANTE: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 8. ESCROW DOCUMENTS FOR COMMUNITY HEALTH PROPERTY Before the Board was signature of the Escrow Documents for purchase of the Community Health property located at 908 NE 4th Street in Bend. MAUDLIN: I move signature of documents. PRANTE: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 9. WEEKLY WARRANT VOUCHERS Before the Board were weekly bills in the amount of $239,675.50. PRANTE: Move weekly warrant vouchers, approval upon review. MAUDLIN: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 10. CITY PLAT FOR WYNDEMERE PHASE II Before the Board was signature of City Plat for Wyndemere Phase II. PRANTE: Move approval. MAUDLIN: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES PAGE 9 MINUTES: 5/2/90 101 - - 0094 11. LIQUOR LICENSE RENEWAL FOR MT. BACHELOR. MAIN LODGE Before the Board was signature of a Liquor License Renewal for Mt. Bachelor, Main Lodge. PRANTE: Move approval. MAUDLIN: Second. VOTE: PRANTE: YES THROOP: YES MAUDLIN: YES 12. PUBLIC HEARING: DESCHUTES COUNTRY STORE Commissioner Throop continued the public hearing to Wednesday, May 9, 1990, at 10 a.m. DESCHUTES COUNTY BOARD OF COMMISSIONERS Lois Bris ow /nte, ommissioner To Throop Chair D1.c Maudlin, Commissioner BOCC:alb PAGE 10 MINUTES: 5/2/90