1992-01353-Minutes for Meeting December 10,1991 Recorded 1/7/19920108 0833
92-01.153 '
MINUTES OF THE BOARD OF COMMISSIONERS HEARINQ v
REGARDING THE INCORPORATION OF SUNRIVER
DECEMBER 10, 1991
ti
DICK MAUDLIN: This meeting is a public hearing on the p,ia/
for the proposed incorporation of Sunriver. The order ofrKI
station will be the presentation of the staff report which be
Kevin Harrison and County Counsel, Rick Isham; the identification
of property for inclusion in the proposed city; the petitioners
will have an hour and forty-five minutes for their presentation
and the opponents will also have one hour and forty-five minutes.
There will not be any rebuttal period allowed this evening unless
the time permits, and there has been a request for this, but we
are going to hold as close as possible to this schedule. It will
be late, but we expected that when we set the hearing.
At this time, have any of the commissioners had any ex parte
contacts prior to this meeting?
NANCY SCHLANGEN: I do not Mr. Chairman.
TOM THROOP: My understanding is that this is a legislative pro-
ceeding. I have clearly had contacts with all parties for both
sides, including folks that don't have a position and it is my
understanding that I didn't need to keep a record and disclose
all of those, but I have had numerous contacts over the last
year.
DICK MAUDLIN: I had contacts over the last week with Mr. Bennett
and Mr. Hyatt who came in to ask about the procedure prior to the
time that we set it up, and I also talked to Mr. Jones, one of
the petitioners and I talked today to Mr. Martin who also asked
about the procedure. Is there anyone here who wishes to chal-
lenge any member of the Board on this hearing?
(A woman asked Commissioner Maudlin to introduce himself.)
Yes, ma'am. My name is Dick Maudlin. I'm chairman of the
Deschutes County Board of Commissioners. On my left is Commis-
sioner Nancy Schlangen. On my right is Commissioner Tom Throop.
Hearing no challenges, we will continue. Kevin Harrison.
KEVIN HARRISON: Thank you Mr. Chairman. Can everyone hear me
okay? No? My voice doesn't carry very well. I hope this is
better. My name is Kevin Harrison and I'm a member of the County
planning staff. My comments will be directed primarily towards
the land use aspects of this petition. My goal here is to help
frame the land use questions involved in this application. To
begin with, the following standards and criteria apply to this
land use decision: Statewide Planning Goals 1 through 14 and the
1 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991 /(QP
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0108 0834
Oregon Administrative Rules interpreting these goals; Oregon
Revised Statutes Chapter 197, dealing with comprehensive land use
planning coordination; Chapter 215, County Planning; and Chapter
221, Cities. Also, the Deschutes County Comprehensive Plan and
relating functional plans, as well as Title 18 of the Deschutes
County Code and related development ordinances.
To begin with, ORS 197.175(1) makes county consideration of
a petition to incorporate a new city an exercise of county
planning and zoning responsibility and requires the county to
discharge that responsibility in accordance with ORS Chapters 196
and 197 and the statewide goals approved under those chapters.
The Supreme Court has discussed this process in its decision in
the Rajneeshpuram case. In its decision, the Supreme Court
explained; first, that the county's decision in connection with
the proposed incorporation is a land use decision which must
accord with the goals; and, second, a county discharges its
planning and zoning responsibilities with regard to whether a
proposed incorporation is in accordance with the goals if the
county is satisfied that after a successful incorporation elec-
tion, it is reasonably likely that the newly incorporated city
can and will comply with the goals once the city assumes primary
responsibility for comprehensive planning in the area to be
incorporated.
I would like to stress this point here because we believe
that this is really the central factor or criterion that applies
to this land use decision. Again, the Board needs to make a
determination that is reasonably likely that the newly incorpo-
rated city can and will comply with the goals once the city
assumes primary responsibility for comprehensive planning. And
lastly, the Supreme Court said the determination of the Board
must be supported by evidence in the record like any other land
use decision.
Staff has prepared a preliminary staff report which reviews
the goals on pages 8 through 13 of that report. We have identi-
fied goal and planning issues we believe are relevant to this
decision and have provided recommendations concerning these
issues. I won't go into those right now unless the Board would
like me to focus on them. But I would like to point out that
there is a basic disagreement between staff and petitioner with
respect to the level of detail needed for the Board to reach a
conclusion on whether it is reasonably likely the proposed city
can and will comply with the goals. Staff believes that addi-
tional information is required for the Board to reach a determi-
nation with respect to Goal 9, which deals with economic develop-
ment; Goal 10, which deals with housing; Goal 11, which describes
public facilities and services; and 12, which deals with trans-
portation. The petitioner believes the existing information is
sufficient. The Board should address this issue during its
deliberations.
2 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0835
ORS Chapter 221.040(2) provides that the Board may alter the
boundaries as set forth in the petition to include all territory
which may be benefitted by being included within the boundaries
of the proposed city. Staff has identified land outside of the
proposed city limits which we believe will be benefitted by
inclusion within the boundaries of the proposed city. These
lands include, first, properties within the rural service center
located on the southwest corner of Spring River Road and Lunar
Drive which are identified on Assessor's map 20-11-07B as tax
lots 100 and 103 through 120. Also properties within the Pace
Estates Subdivision identified on map 20-11-06C as tax lots 3000,
3100, 3200 in Tract A, and finally the properties within the new
destination resort approved south of Spring River Road and east
of the Deschutes River identified on map 20-11-00 as tax lots
1200 and 1300. If the Board decides to alter the boundaries
pursuant to ORS 221.040 in this staff's recommendation, another
public hearing must be held and notice given to those property
owners.
At this time, I would like to submit into the record county
decisions that were referenced in the staff report, as well as
maps of the properties that I have just described here, as well
as names of the owners of these properties.
At this point, if the Board has any questions for me, I
would be happy to try to answer them.
DICK MAUDLIN: The Board has no questions at this time. Rick
Isham.
RICHARD ISHAM: My name is Richard Isham, County Legal Counsel.
I have been asked to comment on the requirements with respect to
ORS Chapter 221, which is the organization and government of
cities chapter relating to the requirement for a tax base with
respect to a petition. Prior to the circulation of the petition
for the proposed incorporation of the City of Sunriver, I in-
formed the lawyers for the petitioners that it was my interpreta-
tion of that statute to require that in order to have a valid
petition that they set forth a proposed tax base sufficient to
support an adequate level of municipal services and a declaration
of the rate of taxation necessary to raise the amount of revenue
equal to the proposed tax base. The reference for that require-
ment is in ORS Chapter 221.031. The basis of a tax base for a
proposed city is to come from an economic feasibility statement
which is required pursuant to ORS 221.035, which says that the
economic feasibility statement shall be prepared by the persons
designated as the chief petitioners and shall form the basis of a
proposed tax base required by ORS 221.031.
Now, the position of the petitioners which has been submit-
ted or will surely be submitted into the record is that no tax
base is required and that the legislative history supports that.
3 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0836
As a point of information, and since this issue needs to be
addressed in this hearing for a number of reasons, that the
legislation which provided that the formation of an entity could
be had without a tax base was set forth in Senate Bill 210, which
was the legislation which required tax base to be considered in
any special district or city incorporation. But provides for
special districts, as opposed to cities, that a tax base and tax
rate need not be included in the petition if no tax revenue is
necessary to support the services and functions described in the
economic feasibility statement. That language is not contained
in Chapter 221, nor the example in the legislative history
relating to the absence of the requirement of a tax base with a
park and recreation district which was formed in Lane County.
Because of the fundamental differences in legal opinions on this
issue, there has been nothing which has changed my advice to the
Board of County Commissioners. And in addition, since petition-
ers have made reference to the legislative history, a copy of
that history will be submitted into the record in the event it is
necessary for the Board to make further review of that issue.
The Board of County Commissioners has also engaged the
services of a financial consultant. The county supplied the
financial consultant with a copy of the proposed feasibility
statement as it was filed with the County Clerk, and also a copy
of the existing state law with respect to the requirement for a
tax base, and a copy of the legislative history. In consultation
with the financial consultant, it was their opinion at this point
that there was insufficient data upon which they could form an
opinion, and advised the Board in terms of the staff report as to
whether or not in their opinion the proposed city's financial
feasibility statement was sufficient to support functions that
would be necessarily provided by a city.
The record will contain a copy of the petitions which were
filed with the County Clerk and which were received by the Board
of County Commissioners on June 10, 1991, and subsequently
accepted. Additionally, a copy of the economic feasibility study
for the proposed City of Sunriver, a copy of the preliminary
staff report, a copy of the affidavit of posting with a notice of
public hearing was posted in four public places within Sunriver,
the affidavit of publication in "The Bulletin" where the legal
requirements for publication were included, the legislative
history which I just referred to, a listing of the properties
which were identified in the planning staff report for possible
inclusion in the proposed city, a map which was submitted by Mr.
Keith Martin, along with the original of a letter which was
signed by William E. Gary, dated December 9, 1991, which was
faxed to the County and delivered tonight, those will become and
constitute a part of the record of these proceedings. Addition-
ally, through some means, which is actually not clear to me, the
County has received a large number of cards of individuals that I
believe are believed to be homeowners or property owners within
4 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0837
the proposed incorporation area, indicating a preference as to
whether they were in favor or opposed to the incorporation of the
city and those will also be included in the record.
Any person who has additional evidence which they need to
submit into the record during the course of this proceeding
should deliver to the recording secretary at this hearing if the
evidence is present. Additionally, the Board of County Commis-
sioners has received a number of letters and, Dick, do you have a
file which includes those letters? . . . those letters which are
in that file will all become and constitute a part of the record
of this proceeding.
DICK MAUDLIN: Any questions for counsel?
BOARD MEMBERS: No questions.
DICK MAUDLIN: You people out there will hear a lot of 223.010's
and few of those things tonight, but those are items that are
necessary to get into the record and we need to be sure that they
are on record, so you will just have to bear with us. At this
time I would introduce Keith Martin, who is the attorney repre-
senting the petitioner.
KEITH MARTIN: Thank you, Commissioner. I guess I have the same
question, can I be heard? We appreciate your willingness to
change the physical facilities for the evening and allow those
who are concerned and interested in this matter to be in atten-
dance during deliberations. For the record, my name is Keith
Martin. I am an attorney with the law firm of Harrang, Long,
Watkinson, Arnold & Laird. My address is 101 E. Broadway, Suite
400 in Eugene. I am here this evening representing the petition-
ers and we are anxious to respond to the interest and concerns
that the Commission has. I would make a formal request to which
you alluded, Commissioner Maudlin, earlier that out of our hour
and forth -five minutes we would like to reserve fifteen minutes
for rebuttal at the end of the evening. So we will endeavor and
request of you that after our formal presentation that the
comments from the public, if they exceed that time, that we get a
chance to discuss whether it comes off the rebuttal or not with
you for a moment.
DICK MAUDLIN: . . . Okay.
KEITH MARTIN: Thank you. As part of the formal presentation, we
have obtained an aerial photograph. It's a 1985 air photo of the
area. We've endeavored to mark on the map or photo the area that
is within the proposed petition to be considered for incorpora-
tion. Then below, in red we have identified what we understand
is the 600 -acre site where there has been preliminary approval
for destination resort, and in blue we have identified the rural
service area that the staff has suggested we consider. And we
5 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0838
did not get the Pace Estates Subdivision on, but I understand
that it is north of Spring Lake Road in this vicinity if that is
correct, and you and those who speak this evening are certainly
welcome to use that air photograph, which we would like to enter
officially into the record, to which Mr. Isham made reference is
a smaller reproduction of this so that the Commission can have it
for the record. And, then we would also like, which has been
noted, the letter of December 9, by Mr. William Gary of our
office, to be part of the record.
As part of this presentation, we have some citizens who
would like to speak to you in an organized presentation. We will
hear first from Dick Wright, who will talk about the history of
the petition and the gathering of information; Mr. Bill Padgham,
who will discuss the issues of the areas benefitted and the
boundaries of the proposed city; then Mr. Charles Cusack will
speak on the economic feasibility study; Sheldon Roberts on the
need the community feels for closer local government that is more
responsive to the interests of that area; Mr. Vern Harms will
speak on the reasons why this community should have the opportu-
nity to vote; and Mr. Herm Miller, who will address some of the
issues that have been raised by the Sunriver Owners' Association
with regard to this petition, which we think misrepresent what is
going on, and we felt that it was appropriate to clarify that
this evening.
After their presentations, I would like to take a few
minutes and maybe a few more than a few minutes . . . I saw a
sign the other day that said talk is cheap unless you hire a
lawyer . . . and I will talk more than a new minutes, although
I'm not sure why entirely, although I do know. If the Chair
would allow, I recognize that at Mr. Isham's invitation there is
being circulated a tablet on which people may sign up and indi-
cate that they will want party status. They don't necessarily
need to testify. They can mark whether they are for or against
this petition going to vote. That's the question. Should the
petition be placed on the ballot. We aren't talking about yes or
no on the ballot, the question is should this go on the ballot.
And, they can sign up and have party status and don't need to
come up and speak at this microphone. But, if it is permissible,
a little show of interest for the Commission, would you allow us
to invite those who would like this matter to appear on the
ballot to stand so you can get an idea of the level of interest
that they have? Would that be alright, Commissioner?
DICK MAUDLIN: I have no objection to that.
KEITH MARTIN: I'm going to invite those who would like to have
this question be placed on the ballot if you wouldn't just stand,
those of you who are standing, you can raise your hands and say
you're with it. Thank you very much.
6 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0839
KEITH MARTIN: Crowdsmanship isn't always something we can play
with. With that, I will ask Mr. Wright to come forward, and the
speakers I have introduced to you to make their statements and
then we'll proceed. Thank you.
RICHARD WRIGHT: I am Richard Wright. I live at 8 Sisters Lane
in Sunriver. I am a member of the Sunriver Incorporation Commit-
tee and also one of the chief petitioners. Can everybody hear
me?
This meeting is the culmination of a long journey. As
Sunriver grew from 1968 until the early 801s, it became apparent
that the permitted increases in the monthly assessment paid by
all property owners in Sunriver would be insufficient to meet the
increased financial demands. This necessity really didn't
crystalize until the transfer of administration from the develop-
er to the Sunriver Owners' Association took place in 1987. The
Board in 1989 agreed that two members of this Sunriver Owners'
Association Board of Directors should make a study, which they
did, of pointing out the possible advantages of forming a munici-
pality. This was done in the spring of 1989. An ad hoc commit-
tee composed of local residents who were not associated with the
Sunriver Owners' Association then made a study of possible
alternatives for the community. And, this committee looked at
special service districts. we looked at how we miaht fix the plan
of Sunriver, which is the gov
and we also looked at incorpo
pros and cons, and then we he
committee's findings in the f
In February of 1990, a commit
ration. This committee discu
the various pros and cons of
ted with attorneys, we consul
bodies, we interviewed a grea
within Oregon and outside of
with local residents. As a r
proposal that you have before
�rning document for the Association,
:ation. The committee developed
_d public meetings to discuss the
ill of 1989 and in January of 1990.
:ee was formed to focus on incorpo-
;sed with a number of city managers
.orming a municipality. We consul -
:ed with various governmental
: many personnel of cities both
)regon, and we discussed the matter
?suit of those discussions, the
you was developed.
The proposal might have taken different forms, but sensitive
to the reactions of the Board of Directors of the Owners' Associ-
ation, we did not include any services which the Association is
now providing to the community. We were unable to establish a
meaningful dialogue with the Board, so we developed an alterna-
tive proposal. Sunriver already has many of the characteristics
of self-supporting city. The Incorporation Committee then pro-
ceeded to develop the economic feasibility study to which you
already alluded, and proceeded further with the petition process.
During this process we consulted with and closely followed the
procedures established by the County Clerk.
With the enthusiastic assistance of a number of Sunriver
residents, we were able to collect the signatures of 402 regis-
7 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
tered voters in Sunriver over one long weekend in May on our
petition. These petitions requesting this body to authorize a
formal vote on the proposal to incorporate Sunriver was formally
presented to the County Clerk in June of this year.
We are aware that our proposal does not have unanimous
support. We do believe, however, that the registered voters in
Sunriver desire to have the opportunity to formally vote on our
proposal. I believe your packets contain a number of letters
from people who were unable to be here this evening, including
letters from a number of non-residents interested in supporting
our petition. The right of citizens to petition their governing
body to form a local government is guaranteed by Oregon statutes.
The desire of local residents to control their own destiny was
expressed in the War of Independence. The registered voters in
Sunriver ask this body to heed their request that they be permit-
ted to vote on our proposal. Thank you very much.
BILL PADGHAM: Mr. Chairman, Commissioners, ladies and gentlemen,
I am Bill Padgham. My wife and I reside at 4 Lofty Lane in
Sunriver. We are active in the affairs of Sunriver, and we
expect to remain active in the affairs of Sunriver regardless of
how these proceedings come out.
My comments tonight concern the benefits of incorporation
and how these benefits related to the proposed boundaries of the
city. You have the map before you, and the map is as descriptive
as anything could be. I will verbalize just a bit on the bound-
aries. On the west and on the north and on the east sides, we
are surrounded by U.S. Forest Service land. And then Sunriver is
bordered on the south by essentially undeveloped land. So the
area contains Sunriver as it exists today and the area adjacent
to Sunriver known as the Business Park. I would note that the
Deschutes River forms a natural boundary along the west side of
Sunriver. Included therefore is a fully integrated community of
residences, businesses, schools, churches and services that will
logically benefit from the creation of local government.
These benefits fall into several categories as follows. The
first category is the financial benefit which arises from the
generation of new revenues not available to unincorporated areas.
The revenue sources include a transient room tax, utility taxes
and State of Oregon revenue-sharing sources. In addition,
financial benefits derive from the ability of a municipality to
borrow in a municipal market on favorable terms to fund large-
scale capital projects. The second category of benefits concerns
local control enhancement, including the ability to elect a city
council accountable to the local electorate and of course the
ability to pass and enforce ordinances dealing with local prob-
lems. The third category of benefits covers the general advan-
tages which accrue to municipal governments which include limita-
tion on tort liability, access to technical and professional
8 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0148 4841
services and the right of eminent domain. At the present time,
the Owners' Association provide the basic services of fire
protection, police and emergency medical and road maintenance. A
private utility company provides sewer and water. To the extent
that these services remain adequate for the needs of community,
and there is no reason to believe that they will not, it is not
anticipated that the city will need to expend resources in these
areas. So the fourth category of benefits is the ability of the
city to concentrate on the development of public works projects,
such as a community center, a performing arts center and city -
owned recreational facilities. And in the final important
benefit that I wish to mention is that the planning function now
performed by the County would be brought to the local level and
done by the city.
I wish to emphasize that the proposal does not include the
use of an ad valorem property tax which would be necessary to
fund a normal menu of city services including the police, fire
and so forth. These are being adequately provided now within the
proposed boundaries by the Association. Therefore, in our
proposal as structured, a city-wide tax for these essential
services would be inequitable. Likewise, inclusion of areas
other than those in the proposal would be inequitable because
such areas have no ability to provide a proportionate revenue
stream without the use of an ad valorem property tax. So we urge
approval of our petition as submitted and I thank you for the
opportunity to speak in its behalf.
DICK MAUDLIN: Thank you, Bill.
CHARLES CUSACK: My name is Charles Cusack, and as you can see,
I've got a bad case of laryngitis so I hope to come across with
the help of this microphone. My wife and I have been permanent
residents of Sunriver since 1976. During our 15 years in
Sunriver, I have served as president of the SROA Board of Direc-
tors for two terms, and I also chaired the consolidated plan
committee which wrote the consolidated plan of Sunriver. I make
those remarks because I think it goes without saying that I'm not
an anti -association person by any means, but I do believe in what
we're doing or I wouldn't be here tonight. Currently I am
serving as co-chair of our Sunriver Incorporation Committee.
I would like to address three areas of our proposal that the
County has questioned; tax base, budget adequacies and services.
On the tax base issues, we did not fail to recognize a tax base,
we simply set it as zero, because our revenues are ample to cover
all projected expenses and we just do not need to impose an ad
valorem property tax. There is considerable precedence for this
in the State of Oregon. We have identified 14 cities which were
formed without tax bases and in most cases are still functioning
without tax bases. Among these are Dune City, Waterloo, Tangent
and Millersburg. Furthermore, and in our opinion, in 1989
9 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0842
legislation which dealt with the tax base issue does not specify
any tax base minimum or maximum.
As for budget adequacy, our revenues are very firm and
conservatively calculated. Dwelling for a moment on the room
tax, we are not unmindful of the importance of this contribution
to the County. However, we feel justified in suggesting that
room tax funds be brought back to Sunriver based upon our new
assessed value of 558 million dollars, we will pay 7 million
dollars in property taxes this year of which roughly $840,000
goes into the County general fund. Since our community needs
relatively few County services, we feel that we are pulling our
own quite weel without paying into the County fund an additional
$983,000 in room taxes. Our budget is heavily impacted by the
presence of tourism, and we think it makes sense to bring these
dollars back home to help defray the expenses in Sunriver which
are directly attributable to tourist activities. The cities of
Bend, Redmond and Sisters retain their room tax revenues for
local use.
The utility tax income we have shown in a very firm figure.
We do recognize that a portion of these taxes may be passed back
to local consumers, however on PUC -regulated utilities, adminis-
trative rules limit the portion that can be passed back locally
in the form of rate adjustments. Additionally, each utility must
make its own determination as to the amounts to be passed
through. Overall, the trade-off in dollars received versus the
potential pass-throughs to our local community is very favorable
to the city.
On the expense side, County staff has questioned our allow-
ance both for the performance of the planning function and
preparation of the comprehensive plan. Our $25,000 budget for
on-going planning results from discussions with several communi-
ties which hire qualified part-time planning, and we are comfort-
able with this figure. As for our cost estimate for preparation
of the comprehensive plan, our $17,000 annual allowance results
from the total estimated costs of $51,000 amortized over three
years. This was discussed with George Read of the County on July
2, 1990, and although George did not commit to the County's
willingness or ability timewise to do this job on a contractual
basis, we came away from this discussion feeling that our allow-
ance was adequate. After deducting estimated expenses from
revenues, there is a surplus of over one million dollars which we
propose to use to fund projects of direct benefit to the city and
to all owners, residents and non-residents. As an example, over
the past 18 months, two proposals offered by the SROA to fund and
build much needed administrative and community buildings has
failed. Available city revenues could be used to make these
facilities a reality without the need for special assessments to
owners.
10 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
Lastly, the County has challenged our performance of only
the planning function. Initially, we've proposed to assume from
the SROA police, fire and road maintenance functions using city
revenues to pay for them. However, due to the unwillingness of
the SROA to discuss the transfer of these functions, it was
necessary for us to adjust our proposal to do only planning. We
have found no requirements for cities under 100,000 in population
to perform any specific functions. Hopefully, however, future
negotiations with the SROA could result in the transfer to the
city of some of these functions using city funds to pay for them
and making possible a proportionate reduction in maintenance fund
assessments to our owners, both residents and non-residents.
In summary therefore, we believe that the proposal is
legally and fiscally sound in those areas questioned by the
County. And that a successful marriage between an ongoing SROA
and a city government can work to the benefit of all elements of
our Sunriver community. Thank you.
RICHARD ISHAM: I have a question for Mr. Cusack. Doesn't a city
need a tax base in order to demonstrate that the proposed city is
likely to comply with its requirements to provide public facili-
ties and services?
CHARLES CUSACK: Well, we took the approach that our administra-
tive overhead and the services that we need to provide initially
are amply covered to the extent of one million dollars surplus by
revenues generated by other than an ad valorem property tax and
are not . . . it seems rather ridiculous to propose imposing an
ad valorem property tax upon the property owners within the
proposed city. We haven't found any evidence to my knowledge or
legal counsel's knowledge that indicates that you have to have an
above -zero property tax. I know that we have a difference of
opinion on that, but that is our contention.
RICHARD ISHAM: During the process, did you develop a budget that
would have included a provision providing fire, police and public
works facilities and that's not in your financial . . .
CHARLES CUSACK: We believe that our initial feasibility study
contained a much more complex budget than proposed to cover all
of the facilities, all of the functions that you have mentioned
including medical. And on that basis, we had initially included
an ad valorem property tax base. Then when we were unable to
conduct a dialogue with the SROA on the possibility of transfer-
ring there, we were faced with the possibility of a successful
election where we had told our people who voted for it that we
were going to provide police, fire, medical and roads, that we
would be opening up a city office the following week and we would
have to go back to these people and say we're sorry, we can't do
this because the SROA is not willing to transfer these functions.
So we felt that in order to present an honest proposal, that we
11 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
had to adjust that and propose initially only to perform the
planning function.
RICHARD ISHAM: In the absence of the . . . (change of tape)
CHARLES CUSACK: . . . and was based upon our assessed values for
last year which came to 370 million dollars, including the
business park, I believe our tax base was $370,000 which would be
a $1.00 rate. Now, this figure has changed because our assessed
value has risen by 52 1/2 percent, and were we to work out a
budget today to cover those services, we might come up with a
different figure. I'm not sure what that would be.
RICHARD ISHAM: In the absence of a transient room tax and if the
proposed city was required to provide public facilities and
services, what would be the basis of revenue to support those
services?
CHARLES CUSACK: In the absence of a transient room tax, we would
have utility taxes, gas, cigarette and liquor and a small amount
of revenue due to Forest Service sharing. And that would be
sufficient to cover city proposed administrative overhead. It
would not be obviously sufficient to provide the one million
dollar surplus that we are forecasting including the room tax
revenue.
RICHARD ISHAM: Thank you.
SHELDON ROBERTS: Good evening. I'm Sheldon Roberts. I live at
4 Grouse Lane in Sunriver, and I am not a member of the Sunriver
Incorporation Committee, although I am a very serious supporter
of them. So what I have to say to you Mr. Chairman and Commis-
sioners, will have a little bit more informal contact and be a
little less technical than what you have heard so far. I first
emphasize that those of us who support incorporation of Sunriver
only wish to have a valid place on the ballot next spring. We
are not prejudging the issue, just as we know that the County
does not want to do that. We simply want to know the will of
registered voters of Sunriver. My wife, Patricia, and I pur-
chased in the 70's a Meadow House Condominium which we still own.
We have lived full-time at 4 Grouse Lane since 1984. We have
celebrated 17 of the last 18 Christmases in Sunriver. We know it
and love it in all seasons. We do not rent our houses. We have
no commercial interest in Sunriver. We simply want to help
develop a residential community.
Currently, you the County are our government. You enfran-
chise us to vote. There are several owners' associations in
Sunriver. We belong to three of them and one elsewhere. They
are all designed to manage and protect the common assets of
property owners. SROA, the ascendent Sunriver association has
attempted to assume a governmental role. It does a good job of
12 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0845
managing governmental assets, but it is not a government. It
depends heavily on Deschutes County for support. There are some
that feel that the County's contribution to our needs and welfare
is minimal.
As permanent residents, we have three pronounced needs in
Sunriver. First we have an immediate need for control of two
widespread abuses: over -occupancy of rental units and massive
damage to our common grounds by renters and also to our bike
paths in particular. Now, pages of discussion have been written
about these problems, but so far very little has resulted except
lip -service. Last month, the County enacted an ordinance to
control over -occupancy, but there is not clear indication how it
will be enforced. At least it shows where the government is.
The City of Sunriver would be able to enact and enforce ordi-
nances to prevent continuation of these long-standing abuses.
Secondly, a city would give us the opportunity for a conti-
nuity of leadership. Because of the ownership control by an
insurance company in Connecticut, during the days of administra-
tion by Sunriver Properties, turnovers in leadership every two
years was not uncommon. I must admit to his great credit, Mr.
Atkinson has held the helm for a long period. However, after
transition to SROA of the stewardship of the owners' assets, we
have had changes in leadership every one or two years. What is
worse, current leadership seems rarely to look back to the
success or failure to what was done years before.
Finally, we need new facilities for our community service
departments and for the activities of permanent residents.
Twice, there have been elaborate and costly plannings and presen-
tations to SROA members for new facilities. In both cases, the
cost and the effort were lost. The proposals were voted down. A
city would be able to approach these challenges differently in
two respects. Most importantly instead of financing from higher
cost private sources, municipal bonds at lower cost would be
feasible subject to voter approval. Then a prudent city govern-
ment would approach these new facilities plannings in a less
glamorous, more cost effective step-by-step method. I remember
an early president of the SROA who had worked, a person who had
worked closely with our principal founder, John Gray, saying in
the early 1970's that Sunriver pioneers "set out to make a real
town here." Although they and many others have long since moved
away, many of us still think that dream can be realized. My
friends, this is a good idea whose time has come.
TOM THROOP: My question is, in the context of your testimony, do
you believe that the County has the responsibility to put a
legally sufficient measure on the ballot or do you think that we
should a put a measure on the ballot irrespective of its legali-
ty?
13 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
SHELDON ROBERTS: Well, Mr. Throop, I'm not an attorney, so I
don't want to render a full-scale legal opinion to you. But, as
a citizen, I do expect that you must conform to the law in
whatever you do, sir.
RICHARD ISHAM: Mr. Chair, I have a question. The bike paths you
identified as being abused, are those open to the public or is
that private property owned by the Sunriver Owners' Association?
SHELDON ROBERTS: Well, it's common ground of the Association,
but it is de facto open to the public, Mr. Isham. That is if you
were to take car loaded with bicycles down there with several
people and get on the path with no arrangements with Sunriver, I
don't think you would be challenged in any way. So in effect,
this is the type of thing that we would like to see controlled in
the future.
RICHARD ISHAM: With respect to the new facilities that you would
propose to purchase through voter approval, have locations within
Sunriver been identified or areas believed to be appropriate for
construction of those facilities and would those facilities by
open to the public or would they be for the use of the Sunriver
residents?
SHELDON ROBERTS: Your first question, such areas have been
identified in at least two proposals.
RICHARD ISHAM: Can you point to the map and indicate where those
might be and then identify in words approximately where they are
located?
SHELDON ROBERTS: Okay. This area right up in here which is
called the amphitheater and this area over here which is involved
in what is now the corporation yard. These are the two areas
that have talked about in these proposals and the final proposal
which was brought to us centered on what is now called the
corporation yard, that area which is to the western side of the
property.
RICHARD ISHAM: And the other part of my question was would those
facilities be open for Sunriver residents or would they be open
for the public?
SHELDON ROBERTS: Oh, I think they would be . I can't speak
for all the people who would be involved in this sort of thing,
but there has been a tradition for facilities to be available,
under the proper arrangements, for the public. That is the
properties owned by Sunriver Properties have been used for public
purposes, and our Fort Rock Park which is up on the ridge and has
recreational facilities has been used by many public groups who
are not restricted to Sunriver.
14 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0847
RICHARD ISHAM: Thank you.
DICK MAUDLIN: Thank you.
VERNON HARMS: Mr. Chairman, Commissioners, SROA board members
and friends. First of all, I am not a member of the Sunriver
Incorporation Committee. I am Vernon Harms and my wife, Judy,
and I have lived at 8 Irish Mountain Lane in Sunriver for over 10
years. We have enjoyed these years and deeply appreciate the
work the governing body has done so that we might enjoy ourselves
here. Lately, a great concern of mine has been the fact there
are those who are seemingly to place obstacles in our path for
having freedom to vote and determine the kind of government that
will govern us locally. The Declaration of Independence of the
United States says as follows, "July 4, 1776, the unanimous
declaration of the 13 United States of America, when in the
course of human events it becomes necessary for one people to
dissolve the political bounds which have connected them with
another and to assume among the powers of the earth the separate
and equal station to which the laws of nature and of nature's God
entitle them. A decent respect to the opinions of mankind
requires that they should declare the causes which impel them to
the separation. We hold these truths to be self-evident, that
all men are created equal, that they are endowed by their creator
with certain unalienable rights, that among these are life,
liberty and the pursuit of happiness, that to secure these
rights, governments are instituted among men deriving their just
powers from those that are governed."
I am here merely to encourage you to give us in Sunriver the
right to vote on our future. Further, in the Bill of Rights,
Amendment 10 states as follows, "That power is not delegated to
the United States by the Constitution, nor prohibited by it to
the states are reserved to the state's respectively or to the
people." I do believe the laws of the State of Oregon grant us
the right to vote and to form our own government.
Personally, we have heard a lot of talk of disenfranchise-
ment. We own a home in Green Valley, Arizona, south of Tucson.
The home is of far greater value than our home here in Sunriver.
It is located on a golf course and has a swimming pool. You can
come and visit us there, Commissioners. Our investment there is
substantial and that is the point I want to make. When the
question of incorporation recently came up there in Green Valley,
we were not asked how we felt. We did not feel disenfranchised
since our residence of record is here in Oregon and we felt that
we should leave the voting in Arizona up to our friends' and
neighbors' best judgment. I believe we are disenfranchised if we
are not allowed to vote here. I urge you to do your best to
facilitate a vote on incorporation for us in Sunriver.
15 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
And, in parting, recently when we visited the Soviet Union,
we had occasion to be guided by a tour host who was a young kid
who had been in the United States for six months, and he was a
little bit cocky and told a lot of jokes about Russia. And, he
mentioned that a Russian had been standing in line waiting for a
chit to go buy liquor and he waited long and finally he said to
his buddy, "I'm going to go and shoot Gorbachev. I'm sick and
tired of standing in line." About five hours later he joins the
line again and he's farther back, and his friend hollers back and
says, "Aren't you the guy that was going to shoot Gorbachev?" He
says "Yes, but that line is still longer." And we don't want you
Commissioners to feel that were standing in line to do anybody in
or looking for handouts and liquor chits, but we do want and
desire the ability and the right to vote. Thank you so much.
HERMAN MILLER: My name is Herman Miller and my wife and I live
in Sunriver and have since 1973. We live on 3 Fifteenth Tee
Lane. During these 18 years, we have been very active in commu-
nity affairs. I've been on the Sunriver board for three terms
and president for two terms and my wife has also served on the
board, and we've both been on various committees and are proud of
Sunriver's Owners' Association and we are happy that we live in
Sunriver and can work with them. I am still working for the SROA
as a member of the judicial council. And I have great respect
for them and for the many others in our community who give their
time and talent as volunteers for the good of the community. I
am also proud to have known many of you people of the County as
Commissioners and I have known Tom Throop for a long time and I
know you all work hard to do what you think is best.
Now, having praised all of you, I would like to point out a
few things about the board's letter of November 1991, with which
I disagree. The letter want to all 4,000 plus owners. Our
Incorporation Committee does not have the staff nor the money to
answer it in kind, but the letter from the Sunriver board takes a
"strong position opposing the petition." The petition they are
speaking of is the petition that would allow us to vote on
whether or not we favor or oppose incorporation. I find it hard
to accept that they don't believe we should vote, but I hope I am
wrong. Their letter goes on to explain the reasons why they are
against incorporation. And those reasons are: (1) possible
disenfranchisement of all non-resident owners; (2) the fear that
additional taxes might be imposed on property owners; (3) the
fear the owners would lose control of boundaries of Sunriver; (4)
the economic feasibility study is inadequate. I think that you
will agree that the economic feasibility study has been well -
covered tonight and I do not intend to talk to that point.
I would like to address the first three of these and first
of all the disenfranchisement. The matters that require a vote
by SROA owners now will still require their vote after incorpora-
tion. The right of them to vote will not be abridged. The non -
16 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0849
resident owners will not vote on matters that are under the
jurisdiction of municipal or county governments. Those outside
of central Oregon voters, non-resident owners, never had the
right to vote in Deschutes County anyway. Deschutes County is
our current governing body, so they will not be losing any rights
they once had. There is nothing a city could do even if it
wanted to that would abolish the Sunriver's Owners' Association
or plan of Sunriver or the covenants, conditions and restrictions
that apply to lots purchased within the community of Sunriver. I
don't feel that anyone is being disenfranchised.
Their second complaint is that there is the possibility of
additional taxes. The petitioners' proposals for a zero tax base
specifically eliminates the possibility of an additional property
tax being imposed by the city. It would take a majority vote of
resident owners to change this. And, as you Commissioners well
know, it is not easy to get taxpayers to vote in favor of taxes.
It is very difficult if there is not need for the money. I don't
think they need to worry about that. In fact, there is a very
good chance that if incorporation is successful, it might reduce
the amount of fees that they have to pay because we could, if the
Owners' Association wanted us to, fund some of the functions they
are now performing that are covered from funds out of the mainte-
nance fund.
The boundary issue has been covered to, to some degree, but
I want to stress that the boundaries as now defined in the plan
of Sunriver cannot be changed without approval of the Sunriver
owners. By boundaries, I mean those boundaries that are set by
the County, the boundaries that will develop from this hearing.
Once they're set, the only way to change those boundaries by
annexation is by having both the City of Sunriver and the annexor
and the other piece of ground, the other entity that would be
annexed, both agreeing to be annexed. If they were both agree-
able to annexing, the boundaries could change. Since both the
majority of non-resident owners and resident owners have much the
same basic goals, that is to improve and maintain the quality of
life in Sunriver, there should not be any major clash over
boundaries. The very small majority [sic] of owners who only see
Sunriver as a place to make a fast buck are of no real concern to
us because there are very, very few of those people.
I would like to end this the way I began it by saying that I
have a great respect for the Board. I know they are dedicated to
the job of improving the quality of life in Sunriver. So are we.
So is the County. We should all get together. Thank you.
RICHARD ISHAM: I have a question of clarification. Was the
purpose of your statement regarding annexation that it would be
difficult or highly unlikely that annexation would occur if
Sunriver was incorporated?
17 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0850
VERNON HARMS: You mean that we could not annex anybody?
RICHARD ISHAM: . . . for clarification of what your point was it
sounded as if you were saying that it would be difficult if not
impossible to annex additional territory to the city once it were
formed, if it were formed.
VERNON HARMS: I was speaking to the third point of concern that
the Owners' Association letter stated that the boundaries might
be changed under incorporation and the Sunriver Owners' Associa-
tion is not in favor of changing the boundaries. Neither are we.
In order to not have the boundaries changed if they are left as
we have proposed them then they cannot be changed unless the
resident owners would vote to annex the adjacent properties and
the adjacent properties would vote to accept that annexation.
Both would have to agree.
RICHARD ISHAM: So you're stating a fact, not expressing an
opinion as to whether that would or would not . . .
VERNON HARMS: . . . I believe I know the people of Sunriver and
I don't believe they want to extend the boundaries.
RICHARD ISHAM: Thank you.
KEITH MARTIN: Commissioners, we've been sitting for an hour and
fifteen minutes. Would you be amenable if it doesn't get charged
against my time that we at least maybe stand up and stretch for a
minute and let everyone else do that?
DICK MAUDLIN: I'm thinking about that. I think what we will do
is you have in your allotted time, by my watch, 50 minutes. If
you're going to leave some time, I would prefer to do the
stretching at the break in the middle of this thing so that we
can get on with this program.
KEITH MARTIN: Alright. Whatever you wish. I would like to make
a couple of major points and respond to some of the questions
that have been asked of those who have testified in the committee
presentation. Most of the detailed responses are in the letter
of December 9, however there are a couple of things that I
believe need to be augmented in that letter in light of the
questions that have been asked.
First of all, it should be underscored that, notwithstanding
the staff's expectations of those who are testifying, to ask
specific questions of policies about what this city will or will
not do is incredibly premature. It is the city council and the
elected officials who, if the city is formed, will set the
policies of the community and be accountable to the electorate.
And, to suggest for the moment what the policies about annexation
will be, what the policies about taxation, what the polices for
18 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0851
services, to identify what specific sites may or may not be the
location of public facilities, are all issues that that city
council has the responsibility to identify.
RICHARD ISHAM: Are you withdrawing the testimony that was
previously given?
KEITH MARTIN: I'm not withdrawing the comments that have been
made by concerned citizens. But, if you're asking about the
legal powers to bind and what will or will not occur when you
create a general power government, you can't suggest that the
petitioners bind that city council. As a principal of law, they
don't have the capacity to do that. All they are asking is that
the vehicle be created, that is the general power government,
closer to home rather than being Deschutes County, to render
decisions regarding the extent of municipal services. The
petition that is before you is only an attempt, as the state law
requires it to be, to demonstrate that the city is capable of
operating economically.
I want to back up for a minute. I don't like to particular-
ly do this. I prefer that others do it. But, I feel the need to
qualify somewhat as an expert before you since your own experts
have chosen not to submit any evidence that I have seen about the
economic feasibility of this community. I have spend 15 years in
the public administration as either an assistant city manager or
a city manager. In the last 12 years, I have been legal counsel
for eight different cities. At the present time, I represent
seven cities and am special counsel for over 10 cities or special
districts in this state within the last 12 months. My experience
includes three years as city manager in Roseburg, nine years as
assistant city manager in Eugene, where I was responsible for the
budget and the day to day operation of 10 of the 11 city
departments. Since that time, I have been involved in being an
adjunct instructor at the University of Oregon teaching graduate
courses in city management and municipal budgeting and finance,
an undergraduate course at Eastern Oregon State College on local
government and budgeting. I am also one of the co-authors of a
chapter in the recent state bar continuing legal education
publication, Local Government Law, on the chapter on public
utilities. Having said all of that, I want to respond to some of
the questions raised.
First of all, I would like to make the point that we believe
legally this petition is legally sufficient. There are two basic
standards as the staff accurately described for you. There is
the standard in ORS Chapter 221 that requires that the commis-
sioners identify what property is benefitted under this proposal,
to include all of the benefitted property and to exclude all the
property that is not benefitted. That chapter and those sections
do not give the Board the choice of refusing to place the pro-
posed measure on the ballot. If boundary commission jurisdic-
19 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0852
tions, where economic feasibility studies have long been a
requirement, the boundary commission has a discretion whether or
not the issue will be submitted. Not so, in what your statutory
duty is. With regard to the land use matter, as Mr. Harrison
accurately described, the issue is one of can this city reason-
ably be expected to perform its responsibilities in land use
planning and in meeting the requirements of the goals. That is a
minimal standard. Throughout the staff notes and comments, they
have portrayed an image of what a city must be in their view.
Our suggestion to you is that the state law does not require that
image.
As I noted to you earlier, we represent a number of cities.
Waterloo was among them at one time. Brownsville and Halsey are.
And, I can assure that you that every community with which I have
dealt has a different perception about what it needs to do or not
do, and each community defines, because the state's goals allow
them to define, what the objectives and economic development are,
how they will address any mandates from the state imposed on
cities regarding housing, all of those discretions. How public
facilities, what public facilities will exist, are discretionary
matters for a city council to determine. Let's create the animal
and let it function.
Now, one of its choices, among many, is if the County is
willing to contract with the city and have the County's compre-
hensive plan and land use ordinances apply. If the city goes
through its process required of the state's goals and in the
course of doing that concludes that the existing County compre-
hensive plan is adequate for that community, ORS allows that
comprehensive plan to be the controlling plan for the city. And,
I want to reference you because your staff has not done that, to
ORS 215.130(2)(b), which allows the city and county to confer
jurisdiction on the county for purposes of a comprehensive plan.
So this city, as it exercises its obligations in performing its
planning function over the next three years, which the state law
allows it to operate, may conclude and come to you the Commis-
sioners and say, hey, we want to operate under your comprehensive
plan. And, you and they can have a discussion and debate about
that and we assume, arrive at an equitable solution to that
matter.
With regard to all of the contracting that is proposed in
the economic feasibility study, the city recognizes that there
has to be a willing party on the other side of negotiation. But,
because this petition will create a general purpose government,
whether it is the County or SROA saying no, we aren't interested
in contracting with you, city. And, if the city has a responsi-
bility of providing this service, then it has the power to do
that, and it has the power to do that because it has the very
power to tax that you have. And, then maybe some more. They
have the power to acquire property, lawfully through whatever
20 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0853
means necessary to accomplish the public purposes and to provide
the public use facilities that are necessary.
It is not a question of whether then can enact a room tax or
not. The answer is, yes they can. Can it be referred to the
voters? Sure, it can. So can yours. Will it be referred to the
voters? It's not your judgment at this point. They have the
power to impose reasonable taxes, to impose reasonable charges
and fees for the performance of the public work that has to be
done. It is their function as the elected officials of the city
to find the equity, the balance that's necessary.
Now, the petitioners have noted in the petition that their
judgment about equity is at this point not to recommend a tax
base. Even if a tax base were approved by the voters at this
election, it would still require a vote of the city council to
authorize the levy of that property tax. The mere placement of a
tax base, if there were none placed, now you have heard Mr. Isham
suggest that there is no tax base. You have heard us say that's
okay, there doesn't have to be, but we have addressed that issue
and said that it is going to be a zero tax base, and the law
doesn't prevent that. Even if there was a dollar figure in that
blank in the petition, the city council is not required to levy
the property tax. They may choose other forms of taxation or
fees and charges.
Now with regards to utility tax, yes there is a privately
operated utility within the confines of the proposed city of
Sunriver. In fact, the boundary is designed, in part contem-
plates, the service area of those public utilities. There are
many communities in this state where the public utility is owned
privately. Lots of them. One unique thing about Sunriver, and
it may not really be so unique, is that the Sunriver utility owns
the sanitary sewer. Most private operators can't wait to get rid
of it and get rid of all the restrictions and problems that come
with discharging into the waters of the state. But, here there
is a private sanitary sewer utility. There is no impediment in
that existing. Hypothetically, for just a moment, suppose that
there were an area within the proposed incorporation where the
sanitary sewer utility did not want to extend sanitary sewers.
The city council is not impotent in dealing with the matter once
the city is formed. I am not suggesting that is what this city
council would do or not do because I don't know, none of us know.
But, it has the power to address it in a multitude of ways. It
could create its own sewer system to serve the area if it were
economically feasible. It could construct the sanitary sewers,
levy the assessment against the benefitted properties and then
contract with Sunriver utilities to treat the sewage if they
would accept the sewage. So there are a variety of ways the
provision of municipal service could occur if there are require-
ments that that service be provided.
21 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0854
I think it behooves this Commission to remember that in the
absence of any concrete evidence, you must presume that the new
city council will act lawfully and meet all of its responsibili-
ties. I don't think it's your prerogative to suggest otherwise.
I wouldn't know how you would create any concrete evidence that
would say some future city council, if the city is incorporated,
is going to act unlawfully. They aren't. The presumption is
that they will do their duty, and that they will be as responsive
to their constituents as you endeavor to be. That is certainly
the heritage in Oregon. And, I think that you should expect that
of this city that will be empowered to perform a full range of
municipal services and to set the policies for that community
and, as necessary, collect the taxes.
I want to take a minute and talk about the characteristics
of the area. I want to note to the Commission the Deschutes
River and its location in relationship to the service center
proposal. I know that that has got to be a problem for you based
on your record of trying to deal with that site. You've got
wetlands. You've got water table problems. There are a great
variety of problems that are in that location. But, consider
what you do to this city if you require it to cross and provide
utility service across the river. That's incredibly expensive
service, and you raise a large number of equity issues that don't
need to be raised. That area has its own set of unique problems,
clearly different, and the cost of addressing those problems is
clearly different than the cost of providing the services that
are here. This area south is unoccupied at the present time, not
incorporated. Should it be included in the petition? We say no.
The petition was submitted for a cohesive community. Should it
be included in an urban growth boundary? I don't know. But,
that is not a decision now. That's a decision that the County
Commissioners in conference with a city council get to make.
But, for you to try and presuppose what that boundary ought to be
at this point in time seems incredibly presumptuous, unless you
can identify the benefit that comes here is identical to the
benefits that have been discussed here. And I don't think they
are. I think that the benefits that the earlier speakers have
identified here are unique to this area partly because of the
presence of Sunriver Properties and the management of the common
areas. We recognize that. But, that is a unique community in
its own right and developed to receive the services that the city
can provide.
I would remind the Commission that you have . . . I don't
need to remind you, you know this. You have the power to regu-
late behavior on private property. You do it all the time.
Noise ordinances, the occupancy ordinance that you recently
passed are all regulating behavior on private property. A city
can regulate behavior on private property. And, so the bike
paths, if they remain in private ownership, the behavior on those
22 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0855
bike paths may still be regulated by the city council. It's not
a question on being unable to go on private and regulate it.
With regard to the location of facilities, as I pointed out
to you, the city council may not want to choose any of the sites
the SROA has considered before. That may be part of the kiss of
death on those earlier proposals and this city council may
envision a different place and location for them. Yes, they have
to provide public access to public facilities. And, they'll have
to work that problem out. Will it be impossible to do? Heavens,
no. If necessary, they could exercise the powers of eminent
domain. Obviously they prefer negotiating and working out with
the SROA or whoever the property owners may involve, but those
decisions of siting public facilities are things that can accrue
later on.
With regard to annexation, the state law does require both
the city's willingness and the property owner's willingness.
That's the way the legislature has set up cities for a very long
time. The city's approval of that can either be by vote as Mr.
Miller suggested, or it's possible the city council will approve
it if the property owners wish it. And, it can go ahead without
a vote in either jurisdiction, but it will have to go ahead with
approval in both jurisdictions and not otherwise. Even if an
urban service boundary were created, that does not assure annex-
ation. That's a separate question. And, again as I mentioned
earlier, urban growth boundaries are matters that ought to be
resolved between elected officials and elected bodies and not at
this juncture in the proceedings.
Lastly, I want to emphasize that this petition meets the
minimum standards. That's all that must be imposed. The minimum
standard is the benefitted property and is not excluding any
property that's not benefitted. And, whether this city, once
formed, is reasonably capable of performing it responsibilities
under the statewide goals. Those statewide goals provide a lot
of flexibility with regard to deciding what the economic opportu-
nities are going to be within the community, how much property is
really wanted to industrial development . . . (change of tape) .
. . has certain unique characteristic that are uncommon to any
other cities and as a result of that, how those housing condi-
tions are addressed with I think a very unique turn. But, I'm
not prepared here at this point to suggest to you what the
solution is. It's just that it has the ability to solve it. It
can address it be adopting its own comprehensive plan or it can
say, me too, to the County's comprehensive plan, because you have
already addressed the question of diversity of housing within
your jurisdiction.
The question of public facilities if have talked about and
the issues of transportation, I don't know of a community in the
state that has quite the level of diversity of facilities when it
23 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0856
comes to bike paths as well as automobile roads and so forth and
opportunities for multi -modes of transportation to occur. The
number of public streets in the community at this point are
somewhat limited because of, at this juncture, we have not been
able to do anything with SROA to the contrary. Will this city be
able to address the problem in the future if it is necessary? Of
course. If SROA is willing, we'll work out something with them.
If they are not, it is essential to the city's performance of its
public responsibility, it has the power to address the problem.
We urge you to let the citizens vote. That's the only issue
before you tonight. Let the petition go to the voter. Let the
debate occur. We suggest in our document that it's a little bit
like designing the cart before the horse is born to get too
involved in what this community can or will or must do. I also
suggest to you that we're at the point where we have become
engaged and not the question between the engaged couple over the
course of courtship is how will we perform. And, we think the
courtship ought to go on. That's the debate that needs to occur.
The marriage can be consummated at the election box with everyone
having an opportunity to say yes or no. Please let the citizens
vote. Thank you very much. Are there any questions?
TOM THROOP: The first question is Mr. Isham in his staff report
pointed out what he felt was an incorrect citation in the Bill
Gary letter of December 9, and I was curious if you would respond
to that. I think he indicated that in terms of the issue of the
need for a tax base that the special district statute, I think
ORS Chapter 178, was cited rather than the city statutes that is,
what, 221?
KEITH MARTIN: Yes, 221. I don't have the exact citation.
TOM THROOP: Okay, 198 is special district. Could you respond to
that issue that Mr. Isham raised?
KEITH MARTIN: The basic statute and the requirements of the
petition are in ORS 221. I think it's in .031 and .035. Mr.
Isham, I don't have the statutes here in front of me to give you,
but I would be glad to correct the citation if that is in error.
I don't think he was saying that, though. We have a miscite on
what page?
TOM THROOP: I think it was more than a miscite. I think it was
a drawing of a conclusion in an incorrect body of a statute.
KEITH MARTIN: We drew a conclusion in regard to the legislative
history on the requirement for feasibility studies. Is that the
one that's in question? I heard him question the legislative
history about that, but if that cite is incorrect, I would be
glad to go back and verify it and see that the Commission re-
ceives . . .
24 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 085'7
TOM THROOP: Well, as I understood it, it was more than an
incorrect citation. It was a conclusion that was drawn from the
wrong statutory citation. If you went to the proper citation,
could you draw the same conclusion?
KEITH MARTIN: Because I didn't do the research on the legisla-
tive history, Commissioner Throop, I'll have to respond to that
later.
TOM THROOP: Second question. You had indicated that making
decisions for a city is premature at this point, and I think the
fine citizens of Sunriver cannot bind the subsequently adopted
local government and you were arguing that a vehicle be created
at this point. It appears that the 1989 statute speaks to the
creation of a vehicle that contains adequate funding, and I guess
I'm curious. The city hasn't been formed, the city council
hasn't been elected, the adequate revenues could only be based on
a subsequent fundamental action of a city council that hasn't
been elected at this point. How can you demonstrate that reve-
nues are adequate to eliminate the need for a tax base when you
don't even have a city formed or a city council formed yet?
KEITH MARTIN: Commissioner Throop, I recognize that none of us
do, and the statute asks that the feasibility study consider ways
that this government can finance itself. The petition has said
it can by imposing what are basically general taxes through
transient room tax or through a tax on the utility, or upon
utility consumption or the use of state subventions. All of
those are legitimate, and in some cases ongoing source of revenue
at the present time being exacted from this community or coming
to the community or its general government. And, when you shift
the general government from Deschutes County to the City of
Sunriver, they stand in, they'll have to make certain legislative
acts, it's true. Why the legislature placed this in the statute,
based on what we understand of the record, was so that the
community, as they debated the ballot measure, would have some
sense of how the city could accomplish its mission. We have
defined a mission and revenue sources that say zero to real
property taxes. They are not a prohibition on property taxes.
It's just that the community is going to take a different ap-
proach. Fourteen cities in this state right now, performing
services in their communities do not levy a real property tax.
TOM THROOP: Were any of those fourteen cities formed after the
adoption of the 1989 statute by the legislature, or were those
adopted under the old standards?
KEITH MARTIN: There were adopted and functioning earlier. To my
knowledge, the last incorporation was the City of Rajneeshpuram.
Now, Mr. Johnson may be able to identify a few others. It is not
a common, everyday event. We've all acknowledged that.
25 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
TOM THROOP: I guess that the difficulty that I'm having . . .
I'm having difficulty reconciling . . . You indicate that we
shouldn't be looking forward to subsequent fundamental acts of a
city that we can't prejudge at this point, yet the 1989 statute
says that the vehicle needs to have, as a part of formation,
adequate revenue to be able to fund those services, and your
response, frankly, did not answer that question for me. Do you
want to make one more attempt at it?
KEITH MARTIN: Commissioner Throop, I just pointed out to you the
only state mandated requirement is that the city be reasonably
capable of performing its responsibilities under the state
planning goals and guidelines. There is no other mandated
service. Certainly, the presence of the existing room tax or the
ability of the city to generate a tax, it would produce the
revenue necessary to meet that requirement is being demonstrated
by saying to you, look, we've got utility taxes that can be used,
we have the room tax that can be used, we have some of the
state's subvention money that can be used. It's not dedicated to
any particular purpose. The road tax, gas tax money is, but the
sin taxes are not. And, beside that, the city has the general
taxing power in addition to that to create whatever it requires
to meet its basic obligation. I think we have more than answered
the question. My question to you was that if there had been a
tax base of a fixed number of dollars put into this petition,
that still does not assure anything because the city council
would have to levy it. And, their going to have to act no matter
what. The legislature, I think, in requiring this economic feas-
ibility study is saying, petitioners, show how this can work, let
the community debate whether a city funded the way you have
proposed is going to work or not. It is not, in my judgment,
your prerogative to go beyond the question of can it reasonably
perform its planning responsibilities. And, having made that
determination, your job is done. That's the minimum standard.
TOM THROOP: Would any of the facilities owned by the city be
closed to the public or, by necessity, are city owned facilities
open to the public? For example, bike paths, parks, common area
KEITH MARTIN: In cities, generally speaking public facilities
are open to the public. But, this is a public facility that were
in tonight. It is not always open to the public, and so there
are general powers limiting how a public facility is used. You
design and construct a senior citizens' center and then you don't
have kindergarten kids playing in it. And, so there are a
variety of things that can happen in the course of regulating
public facilities. But, the public, not just a property owner or
person not just a resident can be allowed in a public facility.
I think that anyone who meets the class gets to come. Now, I
don't know about the county library system here, but I do know
that in a number of places they distinguish library fees based on
26 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
inside the city residents and outside the city residents because
the library is property tax supported and they justify a differ-
ent fee and charge. But, it is still a facility open and used by
some class of the public.
TOM THROOP: Alright. Let's just take for example, on a Saturday
afternoon in the summer, I don't live in Sunriver, can I bring by
family down if the city is incorporated and use the bike paths,
or will there by some mechanism to prevent me or any other member
of the public from using bike paths. Or if I want to pay the fee
to get into the swimming pool, can I do that? I'm trying to get
a sense for closed versus open and I didn't get the sense I was
looking for in your response.
KEITH MARTIN: The answer to the matter is that's a question for
SROA. They own and control the facilities. That's theirs.
Public money cannot be spent on private facilities unless there
is a public use associated with it and identified. This city is
going to have to do those kinds of negotiations with SROA about
use of facilities that SROA owns. Just as if SROA wants to use
the recreation center that is one of the contemplated public
facilities, they're going to have to come and ask permission from
the city.
DICK MAUDLIN: Nancy?
NANCY SCHLANGEN: I have nothing at this time.
DICK MAUDLIN: Mr. Martin, I have one thing that I wanted to ask
you. I know you need to get all of this stuff in the record and
you know as well as I do that I've heard it 182 times, but I'm
glad all these other people got to hear it a little bit, too.
One of the things that concerns me about this thing is that you
keep going back, and a lot of the people that have talked keep
saying, we can do it, we can do it. I want to tell you some-
thing. Every time that I go out into the public and tell them,
"I'm from the government, trust me", they laugh like hell. And,
one of the things that you're saying is that you have presented a
petition that was signed by a number of people that did not
include a tax base saying that we are going to do all of this
with these dollars, and what you're saying is "trust me". And,
that's my concern because right at the moment all of those people
out there I represent, too, at this time and I'm trying to figure
it out. If you just bear with us, we'll get on through this.
KEITH MARTIN: Are you asking me to respond to the problem that
all of us have in the public service?
DICK MAUDLIN: I don't know if you can.
KEITH MARTIN: I can tell you that if the Commissioners and those
of us in this room could find the reason why it is that merely
27 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0860
being elected to office automatically changes a person from one
who could be trusted to one who could not, we could patent it and
make a bunch of money, I guess, and then they wouldn't trust us.
RICHARD ISHAM: I have a couple of questions for Mr. Martin. Mr.
Martin, with respect to the utility taxes, a utility that has a
tax imposed upon it by a municipality is entitled to pass that
tax on in their rate structure to users?
KEITH MARTIN: It depends on how the tax is formed, Mr. Isham.
There are a variety of ways a utility tax can be created. The
franchise fee that municipalities charge for using the public way
which cities get to charge by the way and I'm not sure that
counties do, the franchise fee, under PUC regulations if the
utility is regulated by the PUC, the franchise fee, a certain
element of it, remains part of the rate base. If that amount is
exceeded, then it appears as a separate item on the bill. If the
city chose to just impose a license fee, a privilege tax under
state law, which it has the power to do in certain circumstances,
whether that privilege tax would be passed on to the property
owners or the customer or not is problematic. Nobody has an-
swered the question. If, on the other hand, a utility user fee
is charged, that would all appear on the utility bill. The tax
is not on the utility, the tax is on the consumption of the
utility, much like to room tax works. The room tax is not a tax
against the motel or hotel operator, it is a tax imposed on the
occupant that is collected by the hotel or motel. And, so you
have different incidence of tax all of which we have generally
classified in the EFS as utility taxes.
RICHARD ISHAM: You indicated in the beginning of your remarks
that there were very few public right-of-ways within the Sunriver
area proposed for incorporation. Could you identify those on the
map that you believe to be public right-of-ways?
KEITH MARTIN: There are those that could do a better job than I
of it, but my understanding is that most of the public right-of-
way is just in the industrial park area, some on the access road
into Sunriver and then the abutting County roads. That is my
understanding. But, there is about three or four miles of public
right-of-way within the incorporated area, and I believe the
economic feasibility study says that.
RICHARD ISHAM: Prior to imposing upon a utility a franchise tax
for the use of the public right-of-ways, would the proposed city
have to condemn what appear to be about 95 percent of the roadway
or public property where those utilities are located prior to
imposing that franchise tax?
KEITH MARTIN: You raise an interesting question. The City of
Springfield has recently had to deal with, where I think it was
Sprint Telephone Company had relatively short public occupancy of
28 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0861
the public right-of-way and the issue was how much of a tax could
be imposed. The question is what is the nature of the tax or the
fee that is being charged. If it is a pure franchise fee, then
it is going to be limited to the use of the public way. A
franchise fee is different from a utility tax. So if the inci-
dence of the tax is the use of the public way, that takes on a
different dimension then it does if it is an excise tax.
RICHARD ISHAM: What was the amount set forth in the economic
feasibility statement for condemnation proceedings to acquire
utility right-of-ways or public road right-of-ways where utili-
ties are located?
KEITH MARTIN: There is no money identified for that purpose in
the economic feasibility study. I want to return to the princi-
pal point of the economic feasibility study. There is an inter-
est on the part of petitioners and hopefully it will go on to the
city council that they will collaboratively work with SROA in
the provision of municipal services. If it is necessary to
acquire some right-of-way to accomplish the public purposes, the
city has the power to do that. It will have to have the money to
do it as well. And, there are a variety of ways that money could
be raised. Some of those may require voter approval of bond mea-
sures, but there are a great variety of powers that a general
purpose government has. Having said that, I acknowledge what
Commissioner Maudlin did, you've got to impose on that political
reality. But, this community wants the vehicle to address those
issues.
RICHARD ISHAM: You indicated that the property south of the
proposed area for Sunriver . . .
KEITH MARTIN: Are you referring to the area in red? The 600
acres?
RICHARD ISHAM: I believe you were referring to the RSC property
which you identified as blue on the map. You indicated that the
benefits of including that area in the proposed city limits did
not have identical benefits as the property that is in yellow on
your map, and is there some basis upon which you make that
statement that there is a requirement before the Board of County
Commissioners to consider property for inclusion that the bene-
fits of the added property be identical to the other property?
KEITH MARTIN: The state statute indicates that the property
benefitted by the proposal be the boundaries, that the boundaries
of the new proposed city include the property that is benefitted
by the formation of the city. This city and the general charac-
teristic that is contemplated at this point in time has identi-
fied, I believe, benefits that are unique to this area don't
extend to this, and that was the point that I was making. I
recognize the Commissioners are the ultimate deciders of that
29 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
?108 0862
question. It's a fact question in part that they have to re-
solve.
RICHARD ISHAM: You made a statement that the city could appar-
ently, I'm assuming by ordinance, adopt the Deschutes County plan
in order to meet its requirements under the statewide planning
goals. Is it your position that the requirements of the state-
wide planning goals as they relate to Deschutes County as a whole
are identical to the planning requirements of the city when
meeting those goal requirements?
KEITH MARTIN: Based on the reading that I have made of ORS
215.130(2)(b), it would appear that that could occur. I'm not
saying that it has to be. All I'm saying is that that is one of
the options available in our judgment to the city.
RICHARD ISHAM: Is it possible under statewide planning goals
with respect to a city, that those goals would be applied differ-
ent within the incorporated area?
KEITH MARTIN: Is the question would it be possible? The answer
is yes. Do they, are there different requirements? I think that
there are as we have chatted on other occasions, there's a lot of
questions on exactly what is the city's obligations. My reading
of the goals is that there is a substantial amount of discretion
for the community to define how it will address each of the
goals, and set its own character and nature.
RICHARD ISHAM: Just one last question. You mentioned the
possibility of a contract with the County with respect to land
use planning. What basis either in negotiations or discussions
was had by any individual with the County with respect to such
contract arrangements?
KEITH MARTIN: I think that one of the earlier people testified
that they had spoken to one of the County staff people about the
figures about what that might be, and while the County staff
person they visited with that was named by Mr. Cusack in his
testimony, there was no binding commitment and he acknowledged
that. You don't have to enter into that contract. You meaning
Deschutes County doesn't have to figure into that contract if it
doesn't want to, and if you don't, then the city is going to have
to take the $52,000 that it has set aside for the first year
planning responsibilities and address it some other way. You and
I both know that there are substantial numbers of land use
planners in this state who would welcome the opportunity to
contract to develop the comprehensive plan and the land use
regulations.
RICHARD ISHAM: Thank you.
30 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0863
DICK MAUDLIN: It's 9:15 and your time ran to 9:20, and right now
we're going to take ten minutes and we'll be back here in ten
minutes to start again.
We will reconvene the meeting at this time and call on Ken
Ludlow, president of the Sunriver Owners' Association.
KEN LUDLOW: See written testimony submitted (Appendix A).
RICHARD ISHAM: I have a question. You indicated that there were
627 resident -owned properties. Within the proposed boundary in
the petition, do you have any data on the number of rental units
that may be available or that might be counted as a single
property, but constitute multiple dwelling units?
KEN LUDLOW: Let me get help. Just a second. We don't have that
exact figure, I'm sorry. My top -of -the -head would say that of
the 3,432 balance that probably half to two-thirds of those
operate as rental units either through an agency or on their own.
RICHARD ISHAM: Is that on a short-term or long-term . . .?
KEN LUDLOW: We will get that figure for you if you would like to
have it.
RICHARD ISHAM: I guess the question was that in terms of housing
for people who work in the businesses within the incorporated
area or the area proposed for incorporation, what types of
housing is available in terms of rental units and apartments and
so forth?
KEN LUDLOW: You mean longer term rental?
RICHARD ISHAM: Right, month-to-month tenancy type thing?
KEN LUDLOW: There are a limited number of homes and condominiums
in Sunriver that would be considered for rental. I don't have
the number, but it would be a relatively small number of units.
I would say not over 100, certainly. As far as the rental units
that would be available within the property considered in the
petition, there are apartment units in the business park that are
rented long-term, more than one month, and I believe that figure
is in the area of 60 apartments. I'm not sure exactly what it
is.
RICHARD ISHAM: Do you know what the number of, out of the
platted lots within Sunriver, the number of lots that are cur-
rently vacant?
KEN LUDLOW: We are currently about 65 percent built up now. So
65 percent of the lots have structures on them.
31 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
RICHARD ISHAM: Is there any property within the proposed bound-
ary of Sunriver that has not been platted or designated for
development of a certain kind?
KEN LUDLOW: I don't believe so, no sir.
RICHARD ISHAM: Of the property that is within the boundary of
the proposed City of Sunriver, are restrictive covenants or
possibly the consolidated plan of Sunriver, is that a restrictive
covenant that covers those properties?
KEN LUDLOW: Yes, there are.
RICHARD ISHAM: Is that consolidated plan of Sunriver a public
document that's been recorded with the Deschutes County Clerk?
KEN LUDLOW: Yes, it is.
RICHARD ISHAM: Thank you.
DAVID BENNETT: Good evening. My name is David Bennett. I am
the attorney for the Sunriver Owners' Association. Before I get
into the remarks that I want to read into the record, I do want
to ask a couple of questions. First of all, I want to know how
long the record will be open since this is a land use decision
apparently, and I want to be sure that we have an opportunity to
submit original evidence and not merely the opportunity to rebut.
I understand, Mr. Chair, that you have given the date until
January 14 for rebuttal, but it appears that we will have another
hearing for other owners that you may decide would be within this
area by January 7. If you choose to make a decision no to
include property other than what is within the petition, I'm
wondering whether that record will be open. I certainly request
that we have the record open through the fourteenth of January if
that is possible and let people rebut what's already been said,
let some new original evidence come in. After all, the purpose
is for you folks to have as much evidence as possible so that you
can deliberate and make an intelligent decision on the petition.
DICK MAUDLIN: Written rebuttal will be received from anyone
through Tuesday, January 14. We have here a tentative schedule
of a continuance until Tuesday January 7 to provide notice to
property owners identified. We could have another meeting at
that time depending on what our decision is.
TOM THROOP: That January 14 date is not only for rebuttal
information, but for any new information.
DAVID BENNETT: That's what I wanted to confirm. If the record
were to be open until January 14 for us to raise any original
documents or evidence or for petitioners to, that's fine. I just
wanted to be sure that if this matter is adverse to one or
32 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0865
another party, and I'm sure that your decision will not please
everyone, someone may choose to appeal it. And if they do appeal
it, I want to be sure that we know when the record is closed.
So, I take that to be January 14.
The second question I have is that I would like to be able
to have a copy of the tapes and transcriptions of this hearing
tonight. I presume that's at our expense. That would not be a
very difficult thing to do, but we can listen to those between
now and when we need to rebut.
Then I have two comments. Mr. Martin asked people to stand
who were in favor of the petition and the non-resident owners by
virtue of their non -residency it is not easy for them to get
here. And I recognize they don't vote within the County, but
nonetheless, you make a lot of decisions which affect them, not
only their property, but their enjoyment of their property in
this County and in Sunriver. As was pointed out in the prelimi-
nary remarks, there is a box over here with some approximately
2,000 cards from people who are non-residents, and for the most
part I presume, that some residents were not in favor of incorpo-
ration. The last comment I'll make before I get to my remarks is
Mr. Martin asked if he could be given the time to rebut this
evening, 15 minutes. I'm not sure if he has five minutes left to
that. If you want to have any rebuttal tonight, I just want to
have the opportunity to also do some rebuttal if in fact we get
to that. I'm not asking you to decide necessarily now, but I
would like to be afforded that opportunity.
DICK MAUDLIN: My decision will depend on my feelings about the
time we spend, so I'll let you know.
DAVID BENNETT: I certainly understand that and I hope your
feelings are equal to each of us.
DICK MAUDLIN: It will be.
DAVID BENNETT: See written testimony submitted (Appendix B).
That's the end of my written remarks, but I want to point out a
few other things before I'm through. First of all, I want to
raise the issue of equal protection. There's a case in Califor-
nia, in the Sacramento area, in which a city was proposed to be
formed for the purpose of grabbing tax revenues associated with
the ad valorem tax of a major shopping center/industrial complex.
The trial court said that was okay. On appeal, the court found
that to be unconstitutional as a violation of equal protection
because what happened was that some people within the city, that
particular area, said that for us, let's us grab that great tax
base. We'll use is it and for those folks out there in the
periphery, that's your tough luck. You do what you want to.
And, we have a very similar thing here it seems to me in a very
narrow sense in that they're saying, we're going to grab this.
33 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0168 0866
We don't care about the rural service district, we don't care
about Pace Estates, we don't care about the property to the
south, we don't care about housing for people of low income.
We're going to keep all that revenue for us, right here in River
City. I don't think they can do that under this case, but even
more than that, this case says that it has to be a county -wide
vote, because it's depriving people within the County. Now, what
an Oregon court would say, I don't know. But, I think that's
something for you to consider when your make your determination.
The other thing is that it's very clear the Commissioners
have the right and duty to determine whether incorporation in
consistent with the goals and guidelines, and I want to emphasize
that again. Under 1000 Friends vs. Wasco County, it's clear to
me and it's clear I think to most people who read that case the
you have not only the right, but the duty to see that the state-
wide goals and guidelines can and are expected to be complied
with. Not that we believe that we can do that, not that yes,
that's our undertaking, not wait until we get there and see what
we can do, but up front, your obligations to the citizens of this
community, to the citizens of the County, the people who own
property in Sunriver and to the people who want to vote on this
themselves, to see that that petition is adequate in the first
instance.
Now, one other thing I want to point is that the state
revenue sharing that they talked about with respect to road
taxes, with respect to gasoline taxes, alcohol and other kinds of
things, for cities in excess of 2,500, that cannot be shared by
that city unless they provide for the six services listed in the
statute, and I don't have the statute before me, but police,
fire, sewer, water, planning, those are five I think of them.
There's no demonstration that they're going to provide any of
that. We're not going to provide anything. All we're going to
do is we're going to raise $900,000 or 1.2 million from this room
tax and we're going to let other people provide all of these
services and then what we're going to do is we're going to build
some municipal facilities for ourselves within Sunriver and not
let anybody else have access to them on land that we don't have
and I think that's wrong.
The other thing that's just another aspect of this is that
while that statute says cities of 2,500 or more, and this city in
terms of permanent residents is not yet there but will be un-
doubtedly within the next several years, at any given time, the
population, the people in that city, in that area, exceeds 2,500.
Sometimes they exceed 10,000. Now, it seems to me that we're
providing services not just to the residents, but we're providing
services to anybody that owns property there. Even if we're not
going to allow them to vote, we've got to provide the services to
them. And, that being the case, I think it's even more incumbent
that they show how the services are going to be provided by a
34 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0867
city that has an adequate tax base. That concludes my remarks.
If you have some questions, I would be happy to address them.
NANCY SCHLANGEN: I have a question of clarification concerning
that 600 acres. It was proposed by the petitioners not to
include it at this time. You were talking about the services and
at this time, Sunriver utility company and fire protection are
all providing services to that area. Perhaps I should have asked
Mr. Martin why they don't want the 600 acres included, because
that service area is taken care of and yet they don't want it
included in the incorporation. I don't understand that. They
are saying that this area does not benefit, is not a benefit,
that only the yellow area is. I don't understand that.
DAVID BENNETT: It seems to me you're trying to ask Mr. Martin
that. I'm not going to cede any of my time to him and he can
come back in rebuttal and have that time when it's his turn.
However, it's not my understanding that the area in red in served
by sewer and water from the utility company.
NANCY SCHLANGEN: It is.
DAVID BENNETT: Is it? Okay. I may be wrong about that, but it
may not be fully served. But the question is, the issue I raised
is that one, it had to do with whether or not they could use the
current easement lines for the sewer treatment and the water
lines to go to something outside of what is within the confines
of the Association. The Association owns the land over which
these easements run, and that easement says you can use it to
serve Sunriver, in my view. And, the question is whether they
can do that and that has to be addressed. That was the point I
think I was trying to make about that.
DICK MAUDLIN: Any questions, Tom? Thank you.
DAVID BENNETT: We would like next to have Dan Clinkenbeard, who
is a member of the board of directors and a resident of Sunriver.
DAN CLINKENBEARD: See written testimony submitted (Appendix C).
RICHARD ISHAM: Are you submitting that [table of comparative
budget figures] into the record at this time?
DAN CLINKENBEARD: Yes, it's also part of the testimony that you
will be provided with at the end. What the chart shows is, if
you take what we consider to be the unacceptable $291,000 in
utility tax revenues out of the budget, and you make certain
adjustments that we think the facts and circumstances of the
incorporation in the proposal justify, you'll see that we've
lowered the income by nearly $300,000 and upped the expenses by
about $200,000. A couple of highlights on that. One is increas-
ing the planning function from $42,000 to $70,000, as your
35 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
planning commission has indicated. Another is in police and fire
to the new area, assuming that all the legal problems that have
been discussed earlier can be overcome, our best estimate of the
cost of providing those services, and we used the County's
proposed area to arrive at this figure, is $90,000. And there
are also increases in legal and administrative, accounting staff
and start-up expenses that we think are justified. So this one
million dollar surplus that the committee has been talking about
we think comes down to,a half million dollar surplus.
TOM THROOP: I have a question for our own counsel. Under the
income or the revenue under gas tax under both proposals, there
is $71,856, and I note that under road maintenance there is only
$35,000. I was under the understanding that gas tax is a dedi-
cated fund. Now it looks like only half of it is spent under
road maintenance. Presumably, could the other 50 percent be
spent for other items, including administrative overhead?
RICHARD ISHAM: No, it couldn't. It's a constitutionally dedi-
cated fund and so any surplus would have to be held in reserve
for road purposes.
DAN CLINKENBEARD: When we left the number the same here, we just
weren't arguing with that part of their proposal.
TOM THROOP: Let me ask you one other one . . .
RICHARD ISHAM: As is the forest service revenue. That is paid
to the county for use for roads and schools and any decision to
share revenues from the federal forest service in lieu of taxes
is a decision made by the Board of County Commissioners.
TOM THROOP: Let me ask one other one. The attorney for Sunriver
Owners' Association, Mr. Bennett, indicated that for the liquor
tax and cigarette tax, granted, we're talking less than $20,000,
but indicated that four of six services needed to be provided in
order to be able to attract those dollars to the city. Did I
understand that correctly? Could anyone from our staff confirm
that, and if so, could that little less than $20,000 be collected
without providing for those six services?
RICHARD ISHAM: If I understood the testimony, a population in
excess of 2,500 is the requirement that those be provided. Is
that the testimony?
TOM THROOP: So, if it's under 2,500, there's no requirement?
Okay.
RICHARD ISHAM: Mr. Clinkenbeard, I have a question regarding the
budget of Sunriver Owners' Association. There was earlier
testimony that the Association has 31 employees, I gather of
which 12 were security officers and 8 are fire employees and
36 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0869
EMTs. With respect to the security officers and the fire offi-
cers, both in terms of salary and fringe benefits and overhead
operating expenses, can you indicate what the current budget on
an annual basis is for those two functions?
DAN CLINKENBEARD: Yes, I can if you give me a moment. The
public safety budget for 1991 is $475,900 and for fire is
$526,126. I would note that are employees are not under the PERS
retirement system and have no retirement benefits and no retire-
ment costs, either.
RICHARD ISHAM: Have you done any comparison to determine that if
the same level of service of 12 security officers and 8 fire
personnel we to be city employees, what the annual cost of
providing exactly the same service would be?
DAN CLINKENBEARD: I don't think you can provide exactly the same
service because you lose some services that the County is now
providing for us free, and you would have to pick the cost of
those services yourself. I can't speak to exactly what they are,
but they're administrative and reporting in nature. I can say
that the PERS add-on to the salary cost is 11 percent. Is that
correct? Approximately 11 percent. So, at a minimum, we think
that to cover the territory that you have staked out in the
County's proposal, we would need to add two personnel and in-
crease costs by that proportion. That's how we arrived at the
numbers that we did. PERS would be on top of that, of course.
RICHARD ISHAM: Thank you.
DICK MAUDLIN: Thank you very much, sir.
DAN CLINKENBEARD: I would like now to introduce my fellow board
member, Mike Kelley.
MIKE KELLEY: See written testimony submitted (Appendix D). I
want to turn this over to Ann Porter, another Board member and
non-resident owner in Sunriver.
DICK MAUDLIN: Questions?
ANN PORTER: Thank you. See written testimony submitted (Appen-
dix E).
DICK MAUDLIN: Questions?
ANN PORTER: I now return the podium to our chairman, Ken Ludlow,
for some final remarks.
KEN LUDLOW: Hello, again. See written testimony submitted
(Appendix F). I thought a great deal about this and I have to
add one final thought. As a dedicated, truly dedicated citizen
37 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
of this County and as a resident of Sunriver, I resent the
petitioners asking me to vote for or against the formation of a
city when their petition lacks a tax base and other information
essential to making an intelligent decision. I urge you to deny
the petition. We have written copies of our remarks for each
Commissioner and County Counsel and for the recorder. We also
have a notebook containing letters from numerous Sunriver owners
objecting to the petition, which we would like to enter into the
record.
RICHARD ISHAM: Mr. Ludlow, could I ask you a question? There is
something that is unclear. The presentation by the petitioners
indicated that there have been apparently some attempts to
discuss contract requirements for police and fire and other
similar services and the presentation that's just completed
indicated that there's been no meaningful discussion, if I
understand that testimony correctly, regarding those services.
To what extent, if any, were meaningful discussions with respect
to contracting services to the proposed city?
KEN LUDLOW: There were none. And, at our initiation there were
none. We took that position for a couple of very specific
reasons. One, and as the petitioners' counsel pointed out, the
Incorporation Committee has no authority to negotiate anything.
They have to rely on a city council that would be elected after
formation of a city. So who are we negotiating with? Who are we
trying to settle what with? We felt that there was no require-
ment, need or indeed any effort on our part to do this, and we
stand by that.
RICHARD ISHAM: Thank you.
KEN LUDLOW: We do have three additional people we would like to
have testify regarding incorporation, starting with Lebroux
Edwards, followed by Sheridan Atkinson and followed by the head
of CORA. Thank you.
LEBROUX EDWARDS: My name is Lebroux Edwards. My wife and I live
at 3 Irish Mountain Lane in Sunriver. We have been residents of
Sunriver since 1982 and property owners since 1968. Prior to my
retirement in 1982, I worked for Pacific Northwest Bell for 36
years in Portland and Seattle in a number of managerial assign-
ments. Since moving to Sunriver! I have served on the Sunriver
Owners' Association board of directors for 5 1/2 years. I was
the president of the board for two years during the transition
period when the control and operation of the community was
transferred from Sunriver Properties, the developer, to the
owners' association. I have also served on the board of direc-
tors of Mid -State Electric Cooperative, the company that distri-
butes electricity to Sunriver, for seven years. I want to
discuss the utility tax that is included in the petitioners'
economic feasibility study.
38 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0871
The amount shown is $291,428. This includes taxes imposed
on companies that provide telephone, natural gas, garbage, water,
sewer and electricity. Included in the total amount is the
maximum percentage of tax that a city could impose. Five percent
of a utility company's revenue can be charged with the exception
of telephone, which can be charged seven percent. Oregon stat-
utes and administrative rules limit the amount that can be im-
posed. Further, the statutes indicate that for public utility
commission approved rates, a certain percentage of the utility
tax will be spread over all customers in the jurisdiction cov-
ered, and a certain percentage can be passed back directly to the
customers in the city that has imposed the tax. All of the tax
imposed on the company is a cost of doing business and will be
passed on to their customers.
For Sunriver, natural gas, telephone and water rates are
controlled by the public utility commissioners. Let me give you
an example. For natural gas, the amount of tax included in the
total tax of $291,000 is $49,900. This amounts to five percent
of the annual billing to customers in Sunriver. Three percent of
this can be added to rate of all the customers served by the gas
company in Oregon. Two percent can be added directly to the
customers in Sunriver. This amounts to $19,960 that would be
included in our gas bills. For telephone, four percent would be
spread over all U.S. West customers in Oregon and three percent
would be added to customers in Sunriver. The amount added to the
Sunriver customer bills in the next rate increase would be
$18,000 to pay for the utility tax imposed. Water would be
treated in the same way, except Sunriver is the only customer for
the proposed city, therefore the entire 5 percent or $30,740
would be added to our water bills when the next rates are
approved by the PUC. Sewer rates are not controlled by the PUC
and the Sunriver utilities company could rightfully increase our
sewer rates to recover the $24,159 that is proposed to be charged
as a utility tax. Garbage could also be increased to recover the
$16,500 tax.
Electricity is the largest amount, $128,695. The electric
rates charged by cooperatives are not controlled by the PUC, but
by the board of directors of each coop. There are nine board
members at Mid -State Electric, each representing the district in
which they live. If Sunriver becomes a city, it will be the
first city in the serving area of Mid -State. The board of
directors set the rates and serving with most of them for a
number of years, I would predict that none of them would be
willing to increase the electric rates in their districts to pay
for the tax imposed by Sunriver to help pay for capital improve-
ments in Sunriver. It is my belief that the entire $128,000
would be passed back to the customers in Sunriver on their
electric bills.
39 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 087`2
Adding all of the amounts that I anticipate would be added
directly to our utility bills would come to $237,488 or 81
percent of the $291,000 the petitioners have listed. I estimate
that the increase in my utility bills would be approximately $110
per year. I would prefer to make direct payments by an assess-
ment to pay for a fire hall or a community center, if necessary,
rather than having it hidden in my utility bills. I don't
believe the petitioners have advised the interested parties in
Sunriver of the consequences of a utility tax, nor do I believe
that the residents of Sunriver would stand to have this as a
source of income.
I would like to step away from the utility tax question for
a moment. I don't believe that the petitioners have demonstrated
a need to form a city. One of their statements for the need to
incorporate says, "The additional sources of revenue will permit
the funding of much needed capital improvements." I was the
treasurer for the Sunriver Owners' Association for the past two
years, until November of this year. We are in good financial
shape. We have a balanced budget and have operated that way for
many years. We have a full staff of well-trained personnel who
are paid wages comparable to those paid for similar occupations
in the area. We have excellent equipment that is well main-
tained. We have capital assets of $1,700,000. We have a reserve
account in the amount of $600,000 for replacement of capital
items, and for purchase of additional items. We set aside more
than $200,000 a year each year to be placed in the reserve
account. Housing for our security and fire department and
emergency medical personnel is marginal, and we have no community
center. Plans are being finalized by the Sunriver Owners'
Association board of directors to provide funds to provide
adequate space for the fire and security employees. Therefore, I
don't believe a need exists to form a city to provide "much
needed capital improvements."
To have two governing bodies with perhaps differing agendas
would be a disaster for our community in my opinion. The present
form of government has worked well for many years and I see no
reason to change. Control over Sunriver's future is at stake. I
urge you to deny the petitioners request. Thank you.
DICK MAUDLIN: Questions? Sheridan Atkinson.
SHERIDAN ATKINSON: I want to talk about those microbes again.
My name is Sheridan Atkinson, and I am the president of Sunriver
Properties. I live at 20 Vine Maple in Sunriver and I would like
to speak for a moment as a representative of the developer and I
would also like to speak as a citizen since I guess that's what I
am down there. Whether or not you use the number of 1,200
resident voters against an 8,000 property owner voting base or
whether you use, in round numbers, 4,200 owners of record and
some other smaller number, five to ten percent of that total as
40 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0873
the base that will vote, the issue from a developer's standpoint,
I think, is firstly one of disenfranchisement. I don't think
that a city with its city -type services, city -type of government
is what we sold. What we sold is in fact what we represented to
those approximately 4,200 owners of record and is manifested in
the current plan of Sunriver. Dave Bennett spoke to this partic-
ular issue and so did Mike Kelley, but as a citizen in this
regard, of Deschutes County, I personally believe that is a
county -wide issue and should be a full county vote. That's
probably not a totally popular opinion whether you're for it or
against it, but the County will see a decrease in revenue, and I
personally believe the Sunriver community does benefit from the
room tax receipts received by the County in many ways. Certainly
CORA, COEDC, road maintenance, general County services and cer-
tainly doesn't go unnoticed that the County is already working a
four-day work week, except for you folks.
Under the statewide planning goals, incorporation would
require that adoption of an urban growth boundary, which has also
been covered, and I hate to be redundant, but I think that it is
important from the developer's perspective. And, that urban
growth boundary would in fact have to include lands outside of
the current Sunriver boundaries, which in certain respects would
disenfranchise those non-resident owners and would impact on the
Sunriver planned community itself. Currently, there are no
public lands within the Sunriver planned community zone, nor the
adjoining 600 acres approved south as a destination resort, nor
the business park. SROA, as has been stated is a private, non-
profit corporation, not a public entity. Therefore, it really
asks the question, how do public funds get channelled into a
private organization, because that is specifically where they are
supposed to be headed.
As another point, I would like to show from the developer's
perspective, public support for the work than SROA has been
doing. We have experienced five years of cooperative efforts and
progress since transition. Not that there aren't problems. I
don't think that you can suggest cities are without problems
themselves.
And I think, lastly, it should be stated that SROA in fact
does work, and the risk of losing protection from our PC zone,
which I might add is the only PC zone is the county, is not worth
incorporating for. I don't believe more government is a good
deal, it certainly is not necessary, nor is it wise. I believe
we are fortunate to have the protection of the PC zone which does
provide some exclusivity and it will go with the first public
dime that we take.
DICK MAUDLIN: Thank you, Sheridan. Greg Custer.
41 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 08'74
GREG CUSTER: Members of the Commission, my name is Greg Custer.
I am the executive director of the Central Oregon Recreation
Association, also known as CORA. I would like to begin our
testimony by stating that our comments this evening on whether or
not Sunriver residents have the right to decide for themselves
which government structure they wish to adopt is really out of
our realm, and we're really not here as CORA to speak to that
issue. Rather, our testimony will present our opinion and some
of the visitor industry's concerns about likely impact on the
visitor industry countywide.
CORA is a non-profit, region -wide marketing cooperative
agency that was founded in 1971. The association's mission is
the promotion of tourism, travel and recreation and the subse-
quent economic development in Central Oregon. I would also like
to mention that we currently have 158 members, over a dozen of
which are Sunriver businesses, some of whom have been members of
CORA for our entire 20 -year existence. The association is guided
by the belief that a unified region -wide advertising effort is
the most effective way to promote Central Oregon's diverse
visitor industry and therefore contribute to the regions economic
prosperity. To this end, each year CORA assembles a comprehen-
sive ad campaign that includes display advertising, it includes
production of fulfillment literature, such as the Central Oregon
Vacation Guide, it also includes attendance at consumer and
travel industry trade shows and editorial development about the
region. Complementing this effort is our management of a respon-
sive ad fulfillment center that annually handles nearly 50,000
phone inquiries and also distributes over a quarter of million
fulfillment pieces to interested vacationers. This effort is
supported by a combination of both private sector and public
sector funding.
Approximately 45 percent of our annual budget is contributed
by Deschutes County via transient room tax collections in unin-
corporated areas of the county. Over the past decade, this
county support has been essential to the region's marketing
effort. In the 1990-91 fiscal year, the county contributed
nearly 25 percent of its total room tax collections towards the
visitor industry marketing effort, and this year the County has
budgeted $424,000 to tourism marketing and an additional $65,000
to the business recruitment efforts of COEDC, which is the
Central Oregon Development Council. This extraordinary County
support has been justified by one basic reason. Room tax
receipts have been one of the fastest growing and most important
sources for the general fund in Deschutes County. If this source
is to continue to grow, the visitor industry must maintain its
health. And, in the eyes of the County, a professional, region -
wide marketing effort is instrumental in maintaining the
industry's vitality. Since approximately two-thirds of the
County's contributions to the visitor marketing effort is gener-
ated by room tax collections from the Sunriver area, we are here
42 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0875
to stress the broad implications of Sunriver incorporation on the
continued health of the visitor industry and the overall economy
in Deschutes County.
Specifically, we would like to underscore a couple of areas
of concern. First of all, the elimination of nearly one million
dollars in room tax collections resulting from Sunriver's incor-
poration would diminish the County's ability to function as a
governing body. Already strained County services, such as health
services, facilities maintenance, infrastructure development and
administrative services would be impacted with the burden falling
on the citizens of Deschutes County. Second, should the County
lose nearly a million dollars in room tax collections, it un-
doubtedly would be hard pressed to continue its substantial
support of both the visitor industry's marketing program and the
business recruitment efforts of COEDC. Assuming a two-thirds
drop in room tax collections, a corresponding fall in the market-
ing effort could be highly detrimental to hundreds of Central
Oregon Businesses.
And imagine if you will, the following scenario. A loss of
room tax revenues necessitates the complete elimination of County
support for tourist marketing and business recruitment efforts.
Without any visible promotional effort, visitor arrivals will
inevitably drop. Room nights throughout the County would also
drop and so would room tax collections, and compounding this
problem, a depressed visitor industry would impact hundreds of
industry and non -industry businesses as visitor expenditures
decline. And, the numbers here are significant. Tourism in
Deschutes County in 1989 accounted for $149 million in annual
expenditures and this figure was up 20 percent over the previous
year. Of this $149 million in expenditures, 73 percent, or
nearly $109 million was spent on dining and entertainment, on
retail sales, on ground transportation, on food stores and
general recreation. This broad dispersement of visitor expendi-
tures is essential to hundreds of small businesses throughout
Central Oregon.
In closing, let there be no doubt that if the successful,
region -wide marketing effort for Central Oregon's visitor indus-
try is substantially altered, that room tax collections will no
doubt fall, and the Sunriver incorporation group, as well as the
County, needs to recognize this fact. Tourism marketing is not
something that you turn on and turn off and expect the visitors
to arrive in the same numbers. We have been working for 20 years
to give this region an identity, and to have that effort jeopar-
dized at this point could set the gains made over the past few
years backs substantially.
A marketing effort then is essential to maintaining the
health of Central Oregon's visitor industries which is now the
second most important revenue earning in the region, and any
43 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 08'76
movement that would diminish the County's ability to support this
industry should be carefully considered against the potential
cost and revenue losses that are inherent. Thank you very much.
DICK MAUDLIN: We have with us the local representative from
LCDC, Brent Lake. He has some comments he wants to make, but
he's neither pro nor con, he's just here.
BRENT LAKE: My name is Brent Lake, field representative for the
Department of Land Conservation and Development, and Dick, that's
one of many times, but recently, that we agree on something. I
am here not to speak either in favor or against. But, the point
is that the staff report is very accurate in one point. There is
a lot of work that has to be done, particularly in addressing the
goals 2, 9, 10, 11, 12 and 14. I think that there needs to be
additional information provided in order for the County to make
those findings, because as the Supreme Court case that you have
referred to many times, and you will be making a land use deci-
sion, and that decision will be appealable to the Land Use Board
of Appeals. So, I feel very clearly that you're going to have to
address those factors that are in your staff report.
My staff would like to perhaps file a letter and we are glad
to hear that you are going to leave the record open until the
14th of January, not only for my staff, but I think the citizens
need to have that additional time for those that are not here
tonight to be able to give you that information. My department
will be willing to provide you what information we can, and if
you need to assistance, within our limited budget. I saw Tom
look at me, because Tom, as many of you may know, is only on the
Land Conservation and Development Commission, so he's saying,
where's that work going to come from, but we will provide it. We
are concerned, and want to help Deschutes County and the citizens
of Sunriver as much as possible. So, however we can help you
with that.
DICK MAUDLIN: Thank you, Brent.
BRENT LAKE: Any questions?
TOM THROOP: Let me ask a question. By the way, let me make
certain that I clarify that as a member of the Land Conservation
and Development Commission, I will completely remove myself from
any department or commission deliberations on this. I will have
no involvement in determining how much staff time or anything
else is spent on this issue. I have a very clear conflict of
interest, and I function as a Deschutes County Commissioner on
this issue and will totally uninvolved on that other half.
I wanted to ask you a question, Brent. There was some
earlier discussion about the potential of having the Deschutes
County comprehensive land use plan and implementing ordinances
44 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0877
serve as the controlling documents for a new incorporated commu-
nity of Sunriver. And I'm curious, and it seems the proponents
thought that we might be able to simply move the current County
provisions over and have those current provisions govern a new
City of Sunriver. And, I'm curious what you're reaction is, if
you believe that provisions that were acknowledged for the PC
zone in Sunriver for a resort community in 1980 would be suffi-
cient for the acknowledgement of a city in 1992, or if there are
some live issues there?
BRENT LAKE: I think it will provide some good base information.
Unfortunately, I don't feel it's a document that simply can be
transposed as a city comprehensive plan. I think there are
particularly a number of areas that will have to be addressed in
the area of housing, perhaps in the area, and I was thinking
later on, in the area of the goal 5 resource, fish and wildlife
habitats and deer habitats in the area, and a number of other
things that are not addressed in the County plan looking at urban
development. I think that the PC plan is an excellent plan for
the area and is good base data, and I don't want to downplay that
base data because that's very important in any planning program.
But it will not have, I don't think, the ability to just transfer
and then four years later for us to acknowledge that County plan
as a city plan.
TOM THROOP: Let me follow up, just as an example. Could you
discuss the housing goal? I think the attorney for the propo-
nents indicated that the housing goal possibly could be satisfied
because that housing goal applies to the entire county and though
there may not be low income housing or multi -family housing
provided within Sunriver, the County's plan provided that else-
where. Would that, in your estimation, be sufficient? Can you
discuss just as an example where the insufficiencies might be as
it relates to the housing goal?
BRENT LAKE: Yes. I think the statewide planning goals require
and Goal 10 particularly requires that the city provide housing
for all level of incomes and to look at the entire community and
provide that. The example I think we have at the present time
with a city not willing to provide that is the case of Happy
Valley in the Portland area. We have challenged many times their
ability not to provide a cross level of housing for all levels of
incomes.
TOM THROOP: Let me ask you one other question. You raise an
interesting question there. I know that there are a couple of
communities that have had enforcement orders or currently have
enforcement orders, looking at Happy Valley, looking at Jackson-
ville. What kind of circumstances might, looking at the Sunriver
example, if housing wasn't provided for the array of housing
types or if growth opportunities for the variety of urban land
uses that are contemplated, for example, multi -family, single -
45 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0878
family dwellings, commercial, industrial, if lands were not made
available for those uses for a planning period of say 20 years,
would there be some state scrutiny, potentially enforcement
orders? How might that work? I mean can you adopt a no -growth
city in Oregon or is that not the way the Oregon system works?
BRENT LAKE: I don't believe you can adopt a no -growth city. The
statewide planning goals, because they require a level of service
and housing for all types, eliminates that and requires an urban
growth boundary for the city, and mutually for the city and the
county to adopt an urban growth boundary that will provide for
its people for a 20 -year period. I don't believe you can provide
for a no -growth city. The hypothetical case of whether or not
there would be some type of enforcement against a city if it did
not provide is exactly that, a hypothetical case. It is a
potential, it would be there. I feel that the problem can be
addressed. Whether or not it can be addressed in a satisfactory
manner by all parties I don't know, but, again, it's a hypotheti-
cal case. But it is a possibility.
DICK MAUDLIN: Thank you, Brent, very much. As is probably no
surprise to anyone, I'm not going to have a verbal rebuttal
tonight. We will have written rebuttal and any other written
information you want to give us by the 14th of January. But
before you go, you don't have to stay if you don't want to, but I
have a number of people who came here some distance who wish to
speak tonight and if they want to talk now, we're going to stay
here and listen. I have three people who wanted to speak in
favor of incorporation. First one, I would like to caution you
to limit your remarks to as near three minutes as possible. The
first one who signed up to speak is Robert Manville. Is he still
here? Yeah, he's still here.
ROBERT MANVILLE: I'm Bob Manville. I live at 22 Loon Lane in
Sunriver. The only reason I'm speaking for incorporation falls
somewhat into the area of the County Commissioners. Funding from
Sunriver short-term rentals is turned over to Deschutes County on
a taxed system. I guess that's a true statement.
DICK MAUDLIN: You're talking about room tax receipts?
ROBERT MANVILLE: Room tax receipts, yes, sir.
DICK MAUDLIN: That's correct.
ROBERT MANVILLE: What is returned to the Sunriver community to
compensate for such services as fire and ambulance? Is not there
a Deschutes County responsibility to furnish these services?
DICK MAUDLIN: No. There are fire and ambulance being served,
but it is not the responsibility of the County to provide them.
46 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 08'79
There are fire districts all over Deschutes County, but Deschutes
County has nothing to do with it.
ROBERT MANVILLE: I'll be very
Is there any County support for
Not included, right?
DICK MAUDLIN: No. None.
short because my time is short.
the water and sewage systems?
TOM THROOP: Let me make a point here. We're not in the business
of providing urban services. Cities, special districts, county
service districts provide those services. We provide general
countywide services that are mandated primarily by the federal
government or the state government. You receive a tremendous
amount of service from us, but they are not the urban kinds of
services you are describing.
ROBERT MANVILLE: Is that in return for, say, the room tax?
TOM THROOP: We collect tax money and we provide general county-
wide services in return that all citizens of Deschutes County
receive. If you want more intense urban services, you organize
those is a different fashion.
ROBERT MANVILLE: I guess I understand you. The last comment.
The community has existed for a number of years and, with minor
boundary considerations, there should be no need to spend $15,000
of taxpayer money to substantiate anything. End of comment.
Thank you.
DICK MAUDLIN: If I understood the question correctly and, you
correct me, it's your feeling that the County should not spend
any money to examine what our avenues are regarding this incorpo-
ration petition. Is that correct?
ROBERT MANVILLE: That's basically the gist of what I said.
DICK MAUDLIN: Well, we're in close agreement then. My assump-
tion is that I'm not very happy about spending the money either,
sir, but I think that we have a duty to all of the citizens to
make sure that what we're doing is proper one way or the other.
Whatever way it goes, I think we do need that advice. The next
person is Dave Oliver.
DAVE OLIVER: My name of Dave Oliver. My mailing address is P. 0
Box 3670, Sunriver. I've owned property there since 1970, and I
just want to make a couple of observations here. The reason I'm
standing here now is because when I signed up, it was the short-
est sheet to sign on and I'm not against or for, either one.
But, the observation is that in regards to the expense of the
sewer line that will serve the rural service center across the
river, it's my understanding that the Sunriver utilities will
47 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
provide sewer and water to the new destination resort which is
south of Sunriver and south of Spring River Road which is basi-
cally adjacent to and across the river from the rural service
center. Therefore, from the point of the destination resort
where the Sunriver utilities is going to get across the road the
cost to go down the road to the rural service center should not
be taken into consideration by this Board because that expense
will be borne by the users of that service, the owners of the
rural service center or who else uses that. So that's something
you don't need to consider yourselves with.
That's one side of the aisle. The other side of the aisle
is, an observation that was noted earlier on, that the rental
monies that are coming in could possibly decrease and I would
like to point out that with the new County rules and regulations
that went into effect limiting occupancy, that in reality, the
rental agencies will rent more houses simply because a house that
wants to hold 16 people, a three bedroom house, will not be
limited to eight, so you rent two houses. Now that means the
money is going to go up and you're going to make more money.
Now, if the city comes in and they decide to make the rules
tougher, you can even get more houses in the program, so you can
get more money coming in. So, that's the other side of the
aisle. That's the observations I'm making. So you don't need to
be concerned with the rental money or with the sewer expense.
Thank you.
DICK MAUDLIN: Thank you, Dave.
DAVE OLIVER: You're welcome.
DICK MAUDLIN: Noel Lyons? I didn't think he'd wait. I have a
number of people who wish to speak in opposition. Clyde
Reynolds?
CLYDE REYNOLDS: My name is Clyde Reynolds. I've owned in
Sunriver about 12 years. I have one house and I just sold a lot.
I'm very interested in Sunriver. I want to bring up some facts.
When the Sunriver . . . (change of tape) . . . vote to all of the
Sunriver owners, the 1,933 that they referred to replied.
Ninety-two percent of the replies in Sunriver were against
incorporation. Seven percent were for incorporation. Those were
the ones that stood. Eighteen, or one percent, had no opinion.
Now, in regard to this proposal of incorporation, I haven't heard
anyone discuss or any notes regarding the impact of tax and
budget in regard to Proposition 5 which is limiting, putting a
ceiling on taxes, and could be a very difficult situation in
Sunriver. And, there should be some study and research and
something brought forward to the Commissioners.
Now, under the proposal it says, "However, no transfer of
ownership of equipment to the city from the association is
48 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0881
presently contemplated." Okay. I understand that when the
County arrives at 100,000 population, it's mandatory that a city
provide fire and police protection. Absolutely. Well, if we
have this newly formed city that does not own its fire and police
protection, where are they going to get the money? Well, they
have built into their program a way to get the money. If this
goes through, they call this eminent domain. They can take my
private property. My private property is the property of the
fire, the police and the equipment I have at Sunriver. So, that
is one way to do it, but you don't build a city based upon
confiscation of private property. Now, another thing that they
promote, I understand that Sunriver doesn't have too much debt,
in fact I don't think they have any. They now proclaim that we
can now have deficit financing. That's what we want. Anything
we want, we can go to the bank or raise some bonds, but we have
to pay for it. All you people that want this thing, be prepared
to pay more taxes, and have duplication of government unless you
just confiscate our private property. That's about all I have to
say and it's short. Thank you very kindly.
DICK MAUDLIN: Thank you. Leland Smith?
LELAND SMITH: I appreciate the opportunity to express my views
on the proposed incorporation of Sunriver. My name is Leland
Smith. My wife and I have been full-time, permanent residents of
Sunriver for more than three years. And let me be the first one
to use the new address that was assigned to use by Deschutes
County. We reside at 57613 Rocky Mountain Lane. I would also
like to establish for the record that I'm representing my own
interests as a resident and property owner in Sunriver and since
I have made presentations before you in my other capacity, to
specifically state that I am not here in my employment capacity
with the Central Oregon Economic Development Council. My com-
ments do not represent a position of the Council or of the board,
nor in any other way with the interests of that organization.
I'm here because my wife and I moved to Sunriver three years ago
because we thought that was the best place we could find on the
West Coast to live and we made a personal decision that that's
where we want to be.
I would also like to establish that while I am personally
opposed to incorporation of Sunriver, my primary purpose here
tonight is not to present a case against incorporation, but
rather to state that I believe it would be inappropriate for the
Deschutes County Commission to scheduled an election on this
matter and to encourage you with withhold scheduling such an
election until such time as certain essential conditions have
been met. My basis for this position is that the residents of
Sunriver have been given incomplete and inaccurate information
regarding the effects and consequences of the proposed incorpora-
tion, and that it would not be possible for us to make an
49 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0882
informed decision on this issue of such vital importance to the
community at this time.
I like to try to keep myself informed of issues and when
this subject first came up, I talked to a number of people who
are both on the Incorporation Committee and who are supporting it
and asked them why they were doing this and asked them to explain
some of the issues that I thought were important in this whole
subject. For example, one of the things that I read on the last
session of the legislature was a provision for manufactured
housing in communities of 2,500 or more. And I asked these
people if Sunriver would be required to accommodate low income,
manufactured housing, which would substantially alter the charac-
ter of our community. First, I was informed that we would not,
because we have a population below the threshold level of the
ordinance. So, when I pointed out the growth projections that
was past that threshold level within five years, I was told the
ordinance still would not apply because the CC&R's preclude such
development in Sunriver. But, I told some of these people that I
read the ordinance and the ordinance says that you specifically
cannot circumvent its intent through blanket CC&R's. And, I was
given the opinion, okay, if we have to comply with the intent of
the law, we can accommodate such housing within the urban growth
boundary, but do it outside the present boundary governed by
those CC&R's. So, then I raised the question whether this means
we're going to have to issue bonds and levy property taxes to pay
for the extension of infrastructure to service these areas in
order to provide that kind of housing in the urban growth area.
I was told no, that the City of Sunriver is going to have new
taxes.
And, incidentally, I find it sort of interesting that one of
the stated benefits of incorporation is that we will have access
to municipal bonds and the lower interest rates at the same time
we're told we're not going to have ad valorem taxes. I have done
a lot of municipal finance issues in the last 25 years and I know
for fact and I will represent this for a fact that you don't go
into the municipal bond markets and sell credit -rated municipal
bonds by saying you're going to back them up with the highly
voluble transient room taxes and incidental taxes. You have to
have ad valorem taxes in order to sell municipal bonds. And, yet
I'm told we're going to have lower borrowing costs, but not
property taxes.
So again, I'm not making a case for or against manufactured
housing or whether or not it is appropriate for us to bear the
cost of providing services to outlying areas. I'm saying that
these are important issues that are being addressed with opinions
rather than facts. At this point, I don't know why the incorpo-
ration is considered to be desirable or beneficial. I am told
that there will be a great deal of money diverted from Deschutes
County to the new city, but I don't know what services we will
50 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
lose from Deschutes County, and what benefits we will gain from
the new city. For example, are we going to have to provide a
jail for ourselves, or is Deschutes County going to provide us
with those services, even though we are going to take a million
dollars out of your budget. In fact I'm told that we'll lose
nothing from the County, which I find improbable, and SROA will
continue to provide overall management and services.
So at this point, as a person who has tried to become an
informed voter, I can't tell you what the new City of Sunriver is
going to do. I don't know where this money is going to go.
These questions are important and I'm sure there are as many
hypothetical answers as there are people living in Sunriver, but
we can't make an intelligent decision about incorporation based
on hypothetical answers. We have to have facts. We need to know
what are the laws of the State of Oregon that govern municipali-
ties? What are the requirements of those laws that will apply to
an incorporated City of Sunriver that do not apply to the exist-
ing community? How will our rights and privileges as a private
community be affected by those laws? What new services will we
have to provide in order to conform to state laws? What current
powers will be denied to us if we become a municipality? What
services will we lose from Deschutes County and how will we
compensate for them? And, of course the $64 question, how much
is this going to cost and how will we pay for it?
I believe the only way to get answers to these questions is
to have an objective and impartial analysis performed and the
findings presented to the Sunriver electorate. That analysis
should cover all of the Oregon municipal statutes and the ordi-
nances that would apply to an incorporated Sunriver, not just the
cursory issues that are raised in public debate. The findings
should be presented in a form that fully exposes all of the
issues and accurately informs the residents of Sunriver of the
consequences of incorporation. Until such an evaluation is
provided, we should not be asked to make a decision on this issue
based on assertions, opinions and unsubstantiated claims. That
is what would occur if you should schedule an election without
the thorough analysis, the one that I am recommending. So, I
urge you to withhold the scheduling of such an election until the
residents of Sunriver can be assured that all the issues have
been addressed fairly, objectively and factually. Thank you.
RICHARD ISHAM: Leland, just a question. You made a statement
that based on your experience it would be impossible to market
bonds based on variable revenues unless there was general taxing
authority attached to them. Basically, what is your experience
to make that type of statement?
LELAND SMITH: Prior to moving to Sunriver, I was senior vice-
president and director of corporate consulting services for the
Grubb and Ellis commercial real estate company in San Francisco.
51 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0884
I worked with the national accounts for company. We were the
second largest commercial, industrial real estate firm in the
United States. A large part of our work was working with cities
in the development of surplus real estate. So, we explored all
of the financial avenues that were available to cities so that we
could advise them on how they could utilize their surplus proper-
ties. We did this in a great many different states. And,
essentially looking at debt financing, on the basis of that
experience over a period of about five years, I make that conclu-
sion that cities don't have recourse to debt financing unless
they have a guaranteed ad valorem tax base to back it up or some
other form of revenue taxes. We got involved with airport bonds,
certificates of participation, those sorts of things. But, a
statement was made earlier by the attorney, and I would concur
with it, that room tax revenues aren't what you can go to the
bond markets with and expect to sell credit -rated bonds.
RICHARD ISHAM: Thank you.
DICK MAUDLIN: Thank you. James Freeburg?
JAMES FREEBURG: My name is Jim Freeburg, 7988 Sidney Road S.W.,
Port Orchard, Washington. We pay our assessments promptly and
voted in favor of the new administration building and fire
station. My wife and I are most wholeheartedly in agreement with
the reasons stated by the board of directors of the Sunriver
Owners' Association in opposing the proposed incorporation. We
have been visitors to Sunriver since shortly after its inception.
Eight years ago, we purchased a vacation home in Sunriver, a
resort community, government by an owners' association and
controlled by all property owners. Now a minority group not
content with merely living in an exceptional community paid for
primarily by non-resident owners is attempting to disenfranchise
US. This is gross departure from the concept of Sunriver from
the basis upon which we determined our purchase. Because this is
a resort community, it is by necessity structured as such.
Without the non-resident owners and their tenants, there would be
no Sunriver. I find it most appalling that this group which
represents 15 percent of the development while enjoying the full
benefits is now eager to usurp control from those who pay for a
large part of it. The manner in which they attempt this is a
clear indication of the consideration which may be expected by
the non-resident owners in the proposed city. Thank you very
much.
DICK MAUDLIN: Thank you, sir. Kent Schafer?
KENT SCHAFER: I'm Kent Schafer, 1688 NE Meadow Lane in Bend. I
also own a residence at 3 Rhododendron in Sunriver. I guess I
have a question about the petitioners and what their stated
purpose is. It is not clear to me and I think it is not clear to
a lot of owners and non-resident owners in Sunriver. I would
52 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
like to ask the Commissioners if they would hop on a ship not
knowing just where you're going. Then the captain says we're
going to Hawaii, trust me. I ask the Commissioners who in good
conscience you could allow a minority faction to dictate rules
over the majority. Is that democracy? At least with the Owners'
Association, one owner equals one vote. I concur with Mr.
Clinkenbeard that the petitioners' reliance on room tax is not
justified. What if type situation that came up was if the new
city commissioners dictated a restriction on nightly rentals? In
this particular instance, they would be cutting the very revenues
they're relying on to run their infrastructure. I would urge the
Commissioners to deny this petition.
DICK MAUDLIN: Thank you. Margaret Lambie?
MARGARET LAMBIE: I'm Margaret Lambie, I live in Portland,
Oregon, and I bought my house in Sunriver spring vacation 1974.
My children were then ages 6 to 16 and they have grown up with
the delights of being able to come to Sunriver any time we wanted
to come for the weekend. I have shared my home with acquain-
tances. I sometimes get a call from someone who says, you don't
know me, but I'm a friend of so and so and they've stayed at your
house at Sunriver. In the 18 years that I have had the house,
there's only been twice that I've had problems. One family
thought it was okay to drive their car not out of the driveway,
but across the property in front of the house to the next lane.
It seems that was more convenient, I don't know why. I promptly
put some paving stones down there so that nobody else would get
the idea and I told that family they've never come to my house
again.
I didn't just buy a house at Sunriver. I bought it when
Sunriver properties was running the place and I bought a piece of
a community. Besides owning a house, I own a share of the common
ground around my house. There is a lot of common ground around
my house. I own a share in the tennis courts, in the swimming
pool, the bike paths. If I see anybody going off the bike path
and onto the common ground to cut across the common ground, I'll
get them off their bike and tell them to stay on the path, that's
my property you're damaging. It's everybody's property you're
damaging.
As you can tell from my accent, I grew up on Scotland.
Different places have different rules on public right-of-way. I
grew up in a town called Aire. The county's Aireshire, where the
cows come from, and the river Aire flows through the town to the
firth of Clyde. It's a busy harbor. Off the river towards the
beach there is a slipway and from the site of harbor to get to
that end of the beach there's a bridge that turns and all year
that bridge is set so that you can walk across it, across the
slipway. There might be a board in drydock there being repaired,
but one day a year that bridge is turned so that nobody can walk
53 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0148 0886
across it because if it's not closed it becomes a public right-
of-way after 40 years.
I've heard questions this evening about is that public, are
the bike paths public? Everywhere in Sunriver there are signs
that say for the use of residents and guests only. I have had to
tell the guests that stay at my house those signs mean you belong
there, they don't mean you don't belong there. I think that it
is clear that while the people who own Sunriver, and I mean all
of us collectively own Sunriver, this is private property we're
talking about. It's not a collection of houses that happen to be
in the same place with something or other in between. We all
share in that common ownership. So, I kind of feel uneasy
tonight listening to talk about who's going to govern the place.
To me, the Sunriver Owners' Association is me and all the other
owners, and the people who run it donate their time, they volun-
teer their time. I am tremendously grateful and appreciative to
these people who are willing to give up their free time to help
me have the pleasure and enjoyment that I have. So, I see us as
a closed community that is willing to share with people who live
nearby within the neighboring surroundings. They can come in and
enjoy the bike paths. Nobody's going to say that you don't own
property here, you've got to get out. That doesn't mean we don't
own the property.
I'm a little distressed that this has come before you at all
for your consideration tonight. I think all of the things that I
have said have been said much more professionally by other
people. We pay taxes to Deschutes County and a group of owners,
part of our own group have brought this before you to say, let's
take this out of private ownership and put into public domain and
I think that they must have had a reason for doing it. They must
have had a good reason for doing it, but I haven't heard it
tonight. I hope that you deny the petition. I would not like to
see this voted on at all. I think it's before the Commission
incorrectly.
DICK MAUDLIN: Thank you very much. Somebody wrote down Sunriver
Owners' Association, and I'm not going to let them talk any more.
Art Kegler?
ART KEGLER: My name is Art Kegler and I'm a resident in Sunriver
and have had the opportunity or the duty or the drudgery to sit
in your chair in the past. I have had eight years of that. I
have signed off on a comp plan with Brent Lake. And, I would say
only that at this point, and even of all the literature I have
read, the committee is ill prepared to manage and to govern a
city. I know it will not be their responsibility, but they have
to put the program to work. I would only urge you to at this
point, ask them to go back to the drawing board. I think a total
denial is not in order simply because sooner or later, and I know
many people out there will not like this, but sooner or later
54 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0887
Sunriver will be incorporated. I don't think now is the time. I
don't think the committee is prepared to handled the responsibil-
ities of a city of that size, and I think the Homeowners' Associ-
ation does an excellent job.
There is one other consideration and I will finish on that
point. When you consider this and if you should find it legal,
if you should find that your Commission goes ahead and puts it on
the ballot that you put it on a ballot other than the November
ballot of the general election. I think it will get lost in a
lot of the verbiage and I think it's a very important local issue
and I think you should consider trying to put it on a ballot
other than, either in May or one that would give it its proper
and just view. Thank you.
DICK MAUDLIN: Thank you, sir. Mary Chisholm?
MARY CHISHOLM: Good evening. My name is Mary Chisholm. I'm a
Sunriver resident and business owner, residing at 15 Siskin Lane
and have for four years. I wanted to go on record that I am not
only against incorporation of Sunriver, but that I'm also against
the petition to have it on the ballot and not because I'm for
limiting any of our citizen's rights, but because I think that
we're addressing the symptoms and not the problem. I believe
that we as a Sunriver community have not come together as a
community to solve the issues that we have and to find alterna-
tives to the room tax monies that seem to be the prevalent issue
that I have heard about in the incorporation. And, that we have
not addressed the advantage of the three-phase program that is
already in place. We moved here, myself and my husband, to
escape urban sprawl and because Sunriver was a planned community
with finite boundaries and because of the restrictions that are
in that kind of a community. I don't believe we need incorpora-
tion to gain local control. I believe that we have local control
now. With incorporation, even if the present boundaries are
accepted, Sunriver's boundaries could and probably would in the
future expand and that is one of my major concerns.
Once we incorporate, there's no turning back. I think
incorporation should be our last resort. And, the gentlemen just
before me says that he believes that incorporation is a foregone
conclusion at some point in Sunriver's future. I don't believe
that has to be the case. There has been a lot of Sunriver
Owners' Association bashing. I believe that they have done a
good job. It's, after all, our association. If we don't like
the way it's being done, we have the opportunity as owners to
change it, to get new board members just as we would do if we had
elected officials under a city -form of government. We have the
same responsibility now that we would then, however, we would
have one less layer of government. In conclusion, I see no
benefit from incorporation at this point in the life of Sunriver,
but I do see us as a community jeopardizing a quality of life
55 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
0108 0888
that I know all of us treasure for a perceived monetary gain.
Thank you.
DICK MAUDLIN: Thank you, Mary. That completes the testimony for
the evening and I want to first of all thank you. It's wonderful
to work with professionals. Everyone has been very kind and it's
been an excellent meeting. You know each other and you get along
and I really appreciate the fact that it's been the kind of
meeting it's been. My intent at this time is to suspend this
meeting until January 7. I don't think that there is a decision,
and probably not necessary to make a decision on whether there
will be another hearing on this matter. We can make that deci-
sion in the next couple of days and be sure we have a timeline to
advertise this. Is that correct? Or, do I have to just defer .
TOM THROOP: What is the proper timing to consider whether or not
we're going to have an additional public hearing on possible
other properties to be included in the boundary?
DICK MAUDLIN: That is something I think we have to discuss
before we can suspend the meeting to the 7th. Do we postpone the
meeting until the 7th and then make a decision as to whether we
are going to add additional property, or do we have a time frame
that we have to advertise, notify, that sort of thing?
RICHARD ISHAM: Mr. Chairman, the staff report proposed inclusion
of certain properties on the basis that they would be benefitted
and submitted into the record. There is no specific time frame
except that notice has to be given to each property owner so that
they can appear before for the Board and show cause why their
property should not be included within the proposed city. That
notice has not officially been given to any of those persons that
were listed on the sheet showing properties that were included in
the record, and so it's the staff report's conclusion that those
properties would be benefitted based on the information that was
submitted into the record. Although no decision would be made at
this point by the Board by the giving of notice, because any
decision for inclusion or exclusion would occur, so it's probably
appropriate for the Board to direct that notice be given to those
people set forth on the list of property owners identified south
and southwest of the proposed boundary and that the hearing be
continued to Tuesday, January 7, 1992, at 11:00 a.m. to hear from
those property owners.
DICK MAUDLIN: Mr. Isham's recommendation is that we go ahead and
notify the affected parties to the south and southwest and to
direct all of these people to be noticed and to have them meet at
the County Commission office on Tuesday, January 7 at 11:00 a.m.
for a show and tell to tell us why or why not they should not be
included in this district.
56 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
44
L '♦ ',!`m
TOM THROOP: We would make a subsequent decision on whether or
not they were to be included, let's say for example, nobody
showed which means nobody is there to protest it, and could still
make a decision not to include the properties?
RICHARD ISHAM: Right. That would be in your final decision and
order.
DICK MAUDLIN: Let me ask you one more question since I started
this mess. We're meeting tomorrow as the Board of County Commis-
sioners. Was there sufficient testimony to say no, we don't need
to include any more or yes, we do need to include more? Why
should we go to the effort of notifying if it isn't necessary.
RICHARD ISHAM: The statute authorizes you to continue to the
meeting from time to time. You could continue it to a regular
board meeting at the Deschutes County Administration Building at
10:00 a.m. tomorrow, Wednesday, December 11, if you wish.
TOM THROOP: Let me ask this question. Are we in a position in
your opinion, in staff's opinion, to make that determination
tomorrow when we haven't closed the record yet. I guess the
record wouldn't be closed until the 14th anyway. We wouldn't
have made a decision until after the 14th, but are we in a
position now with the record being open to make a decision now as
to whether we are or are not going to include the benefitted
properties?
ALLAN JOHNSON: I guess I would say that you probably are not in
a position to make that final determination and what you ought to
do is make a determination is that these properties may be
necessary and may be benefited and that therefore notice should
be given and people should be given the opportunity to come in
and to object so that you leave your options open in both direc-
tions, to make the decision after you have all the evidence in.
DICK MAUDLIN: I never argue with anybody we hire. We will
notice and we will do it at, whenever the department gets it done
and this meeting is postponed until January 7, at 11:00 a.m.,
Tuesday at the County Commission Board, probably Room A at the
Juvenile Department. ,Thank you all.
day of �-tic_, 1991, by the Board
DATED this 4.�
of Commissioners of Deschute
ecording Secretary
57 - MINUTES OF BOCC HEARING OF DECEMBER 10, 1991
APPENDIX A
0198 0899
Good evening, Commissioners. I am Ken Ludlow, President of
the Sunriver Owners Association Board of Directors. With me are
David Bennett, attorney for Sunriver Owners Association, Dan
Clinkenbeard, Director and Secretary/Treasurer, Mike Kelley,
Director, and Ann Porter, Director residing in Portland. We are
appearing in opposition to the petition to incorporate Sunriver.
Our position is supported by the Board of Directors of the Sunriver
Owners Association.
Our opposition is based upon both the legal and practical
aspects of the petition which the Incorporation Committee
submitted. We do not believe it meets the legal requirements
mandated by state statutes, and strongly believe the Economic
Feasibility Study contained in the petition is inadequate and
misleading.
We suggest to the Deschutes County Board of Commissioners that
it has no choice but to deny this petition as it neither meets the
legal requirement nor the practical requirement for an incorporated
city.
That is our position, now let me support it with some facts
and questions. First, these facts about Sunriver today.
• Sunriver Owners Association, a non-profit corporation,
includes all owners of property within Sunriver as
members. Including residents, non-residents, commercial
and resort properties, the total number of properties is
4,069. The breakdown is as follows:
PAGE 1. KEN LUDLOW TESTIMONY
01,108 0891
Resident -owned - 627
Non -resident -owned - 3,432
Commercial/Resort - 10
Total = 4,069
• All owners and their property are subject to the
Consolidated Plan of Sunriver which grants the owners
equal privileges whether they are residents or non-
residents and subjects these owners to equal obligations
and restrictions.
• All of these owners have a vote for election of the Board
of Directors on proposed amendments to the Sunriver
Consolidated Plan, on issues covered by the Sunriver
Consolidated Plan, and certain issues covered by the
Bylaws and Articles of Incorporation. The Sunriver
Owners Association Board of Directors, elected by all
owners, is empowered to adopt Rules and Regulations,
which are consistent with the Consolidated Plan of
Sunriver.
• Sunriver, under the Consolidated Plan, is operated and
maintained by its nine member Board of Directors, which
supervises the Sunriver General Manager and a staff of
31 including _12 security officers and
8 firemen and EMT personnel.
Under incorporation, the City of Sunriver would have its own
Charter (which may or may not be consistent with the Consolidated
Plan), its own ordinances, its own City Council, and its own
bureaucracy. The City Council would be elected by the registered
PAGE 2. KEN LUDLOW TESTIMONY
0108 0892
voters within Sunriver (presently 1,050) who are owners of the 627
properties occupied full time, together with their spouses and
voting age children. This represents only 15.4% of the people who
own property in Sunriver. This 15.4% would control the City
Charter, the Bylaws and the ordinances. The more than seventy-five
percent of Sunriver Owners who do not vote here would have no voice
on any ad valorem tax levied in Sunriver, yet they would pay 85% of
the tax. Ladies and Gentlemen, that is taxation without
representation, and is patently contrary to the democratic
principles we all hold dear.
I now would like to introduce David Bennett, the Association's
attorney, who will address some of the legal deficiencies in the
Petition.
PAGE 3. KEN LUDLOW TESTIMONY
APPENDIX B.
0198 0893
INTRODUCTION
Good evening. My name is David Bennett. I am attorney for
the Sunriver Owners Association. I would like to address the legal
deficiencies of the Petition and accompanying Financial Feasibility
Study in relation to the statewide land use planning goals and
guidelines. The petitioners bear the burden of showing that the
proposed incorporation is consistent with the goals and guidelines
and with the Deschutes County Comprehensive Plan. Because the
goals and guidelines are incorporated into the Deschutes County
Comprehensive Plan, and because of the legal questions surrounding
the applicability of the Comprehensive Plan, I will focus my
remarks on the goals and guidelines themselves. Ultimately, it may
be irrelevant whether the goals and guidelines apply directly to
the question of incorporation, or whether you analyze compliance
with the goals as embodied in the Comprehensive Plan. In either
event, the Petition must be consistent with the goals and
guidelines.
In this connection, I want to make it clear that Sunriver
Owners Association understands that the actual drafting and
acknowledgement of a comprehensive plan and zoning ordinances for
a new city call for a much more direct and detailed application of
the statewide goals and guidelines. Sunriver Owners Association is
not trying to require the petitioners to write every section of a
comprehensive plan even before an incorporation vote is held. On
the other hand, Oregon law is clear that in order to approve the
PAGE 1. DAVID BENNETT TESTIMONY
Petition and call for an election, this Commission must be
satisfied that incorporation of a new city of Sunriver is
consistent with statewide goals and guidelines. That, in turn,
requires an inquiry into whether the petitioners have shown that
they can comply with the goals upon incorporation. It would be
irresponsible to go to the expense of a vote and organization of a
new city if it has not been demonstrated at the beginning of the
process that the city will have the ability to comply with Oregon
land use planning laws. At a minimum, petitioners must show their
ability to comply with the goals or guidelines. If they cannot,
the Petition must be denied.
Applying that test, we believe that the Petition is legally
deficient in several respects and, accordingly, that you should
deny the Petition.
GOAL 11 - PUBLIC FACILITIES
Goal 11 requires the petitioners to show that a minimum level
of public facilities could be provided to the new city. Goal 11
specifically lists among these services the following: sewer,
water, road maintenance, police, fire, planning and zoning, and
community governmental services. Even a brief review of the
Petition discloses that petitioners have proposed a mere shell of
a city, a municipality that will not provide any of the public
services and facilities that a local government should be expected
to provide.
PAGE 2. DAVID BENNETT TESTIMONY
i• •
Sewer and Water
Sewer and water services are now provided to the property
within Sunriver Owners Association by Sunriver Utilities Company,
an affiliate of Sunriver Properties, the successor developer of
Sunriver. The petitioners have shown absolutely no ability to
control whether Sunriver Utilities will in fact provide sewer and
water services to the land within the city's proposed boundaries,
not to mention the additional property proposed for inclusion by
County staff. A municipality of Sunriver would have no control
over whether Sunriver Utilities Company provided such service. Nor
would the city have any control over the cost of such service if
Sunriver Utilities should choose to provide it. In addition,
certain sewer and water service transmission lines now used by
Sunriver Utilities are located on, and benefit from, an easement
over property owned by Sunriver Owners Association. Among the
issues petitioners have ignored is whether this easement includes
the right to use the transmission lines for service to properties
not currently served.
Roads
The vast majority of the roads located in the Sunriver
development are private roads, owned, maintained, operated and
patrolled by Sunriver Owners Association. Accordingly, the use of
those roads is strictly subject to the terms of the Consolidated
Plan and may be further regulated as determined in the discretion
of the Sunriver Owners Association. Sunriver Owners Association
has no obligation to permit the use of roads within Sunriver by
PAGE 3. DAVID BENNETT TESTIMONY
anyone other than Sunriver owners and their guests. The
petitioners have not even addressed the complications posed by a
city consisting primarily of private roads.
Police and Fire
One of the most troublesome aspects of the Petition is its
assumption that police and fire protection will be provided by
Sunriver Owners Association to properties not subject to Sunriver's
Consolidated Plan. This assumption is apparently just that - an
assumption. There have been no contracts signed, none has been
negotiated, and no proposals have been made which are acceptable to
Sunriver Owners Association.
In any event, Sunriver Owners Association's private security
force would not be authorized to enforce the ordinances or laws of
a new city. This could only be done through an intergovernmental
agreement between the new city and the County Sheriff (which would
generate additional costs not reflected in the Financial
Feasibility Study) or by a new city police force (which would
similarly increase the costs projected by the petitioners).
Neither the Sunriver Owners Association Board of Directors nor its
security force is under any obligation to agree to provide security
services for properties outside the current boundaries of Sunriver.
The primary purpose of the Sunriver security force is to enforce
the private covenants contained in the Consolidated Plan and Rules
and Regulations of the Sunriver Owners Association, although the
members of that security force are currently deputized by the
Deschutes County Sheriff to augment an existing sheriff's
PAGE 4. DAVID BENNETT TESTIMONY
�l' 08 0897
department. Their primary duty, however, is not the enforcement of
criminal laws.
On the other hand, any security force, private or otherwise,
hired by a new city of Sunriver may not be authorized by Sunriver
Owners Association to enforce private covenants. The primary duty
of a city police force is the enforcement of city ordinances and
state laws. Under Oregon law, then, the city would constitute a
law enforcement unit and its security force would come within the
statutory definition of police officer, requiring their attendance
at police training facilities at additional cost to the new city.
In addition, because they would be public employees, these police
officers would automatically have to be covered by the Public
Employee Retirement System (PERS), at still additional cost to the
city. The Petition submitted to you does not even contemplate the
difficulties in providing police and fire protection to the new
city, and does not budget a single dollar for police or fire
protection, both of which would be required to be provided at
additional cost if the city is to have any ordinances or any fire
protection. It is our understanding that the petitioners have
suggested in their discussions with some Sunriver residents a
number of ordinances that the new city is contemplated to pass
following incorporation.
Planning
The Petition suggests that planning and zoning services for
the new city, including the creation of a comprehensive plan and a
complete set of zoning ordinances for the new city, would be
PAGE 5. DAVID BENNETT TESTIMONY
accomplished by contract with the County. We believe the estimate
of costs for these services are unrealistically low. Instead of
the $42,000.00 per year for planning and zoning services
contemplated by the petitioners, County staff has estimated a
minimum of approximately $70,000.00 per year. Although Sunriver
Owners Association does not currently perform all of the functions
required to be performed by a local government regarding approving
various developments, Sunriver Owners Association does have
considerable experience in land use review matters through its
Design Review Committee and through enforcing the Consolidated Plan
and Rules and Regulations of Sunriver. We believe that even a
$70,000.00 per year estimate is low, and that it will cost
materially more than that for the city of Sunriver to comply with
its legal obligations concerning land use matters.
In regard to land use planning under the authority of a new
city, Sunriver Owners Association wishes to express its particular
concern about the impact of yet another layer of zoning and
planning regulations on the quality of life at Sunriver. The
Sunriver Consolidated Plan would continue to control specific
development applications within the boundaries of Sunriver with
respect to design review and other matters covered in the
Consolidated Plan. At the same time, however, if a new city of
Sunriver is formed, that city will be forced to comply with all of
the statewide land use planning goals and guidelines within the
boundaries of the new city. Since the existing Sunriver
development will constitute the vast majority of land within such
PAGE 6. DAVID BENNETT TESTIMONY
a new city, we believe that the new city will have substantial
difficulty in complying with those goals and guidelines.
GOAL 10 - NEEDED HOUSING
One of the statewide goals that would prove the most difficult
for the new city to comply with is Goal 10 regarding housing.
Among other things, Goal 10 would require the new city to ensure an
inventory of buildable land within the city sufficient to meet the
city's housing needs. This requires a consideration of the variety
of housing types and the full range of income levels and housing
prices that exist in the County.
Your staff's report discusses the median income levels and
housing costs prevailing in Deschutes County in some detail. This
report shows a need for lower cost housing. If Sunriver were to
incorporate as a city, the need within the Sunriver boundaries
would be even more acute. As a private community, Sunriver does
not have to meet Goal 10. Sunriver has been conceived and
administered as a particular kind of community, with extensive
restrictions on the type of development that may take place, the
size, location, materials and physical appearance of buildings that
may be constructed, and restrictions designed to ensure the maximum
preservation of trees and open space in its natural condition. The
debate here is not whether this type of community may appeal to one
particular person or another. The point is that the community of
Sunriver has been specifically and substantially restricted in the
nature and extent of development that may take place there. All of
these restrictions increase the price of housing in Sunriver.
PAGE 7. DAVID BENNETT TESTIMONY
01108 0900
Obviously, the property owners in Sunriver believe that it also
maintains the value of properties in Sunriver and for that reason,
among others, those restrictions are strictly enforced.
If Sunriver were a city, however, the city's obligation to
comply with Goal 10 and to provide needed housing would be in
direct conflict with the Consolidated Plan and the restrictions
that have made Sunriver what it is today. Since the Consolidated
Plan should continue to control development on property that is
subject to the Consolidated Plan, the new city would have to look
elsewhere for available property to meet the housing goal. The
Petition fails to address this goal altogether. At a minimum, the
petitioners must be required to identify an inventory of buildable
land within the boundaries of the proposed city, including an
analysis of any private restrictions that may affect development of
that property or the price of housing developed on that land. In
addition, it is not enough simply to point to a chunk of land and
say, "This is our Goal 10 parcel." The petitioners must show that
urban services, such as sewer, water, roads, police and fire
protection can be provided to this buildable land at reasonable
levels and within a reasonable time frame. The petitioners have
not done so.
Under Oregon law, the petitioners' failure to meet this Goal
is sufficient reason in and of itself for this Commission to deny
the Petition.
PAGE 8. DAVID BENNETT TESTIMONY
0108 0901
AD VALOREM TAX
The petitioners have proposed as the city's sole source of
revenue collection of a 7% room tax on short term rentals generated
within the proposed city's boundaries. This money is currently
paid to the County. It is far from clear, however, that a new city
can be legally incorporated in the State of Oregon without the
imposition of an ad valorem tax.
ORS 221.031(2) provides that, among other things, a petition
for incorporation "shall also include a proposed tax base
sufficient to support an adequate level of municipal services and
a declaration of the rate of taxation necessary to raise an amount
of revenue equal to the proposed tax base." (Emphasis added.) The
law also requires that "The tax base shall be expressed as a total
dollar amount and the tax rate shall be expressed in dollars per
thousand dollars of assessed value. The tax rate shall be
calculated for the latest tax year for which the assessed value of
the proposed city is available." (ORS 221.031(2)).
The purpose for this law is clearly to permit prospective
voters to have full disclosure of the financial impact of the
proposed incorporation in the form of new or additional property
taxes. The need for such a requirement is revealed by the Petition
before you now. Significantly, this same statute requires
disclosure of the proposed tax base needed "to support an adequate
level of municipal services." As representatives of Sunriver
Owners Association will continue to explain, the petitioners have
not only not proposed an adequate level of municipal services, they
PAGE 9. DAVID BENNETT TESTIMONY
9198 9992
do not even control the methods and facilities needed to deliver
municipal services to those areas within the proposed city's
boundaries that already receive such services. This is another
instance of a proposed level of government promising to provide
services without increasing costs, and as we think you will see,
the petitioners' financial expectations are unrealistic.
Even if the petitioners could realistically provide an
adequate level of service without an ad valorem tax, the language
of the Oregon statutes on this point appears to require the
petitioners to propose an ad valorem tax and to disclose fully both
the tax base and the tax rate before the incorporation election.
For this reason alone, you should deny the Petition.
F1��YiY �:l iTr7
Although each of the statewide land use planning goals and
guidelines must be satisfactorily addressed by the petitioners to
show that incorporation would be consistent with those goals, the
two goals I have discussed, Goal 10 and Goal 11, are the goals that
are most dramatically affected by incorporation of a new city. The
petitioners have not shown, and we do not believe that they can
show, that incorporation would be consistent with these goals. The
petitioners have proposed a shell city which is unable to provide
any of the urban services that a city should provide, and they have
not even addressed the myriad issues associated with the need for
adequate housing stocks.
What may have appeared to the petitioners as a relatively
simple grab for room tax revenue should not mislead the residents
PAGE 10. DAVID BENNETT TESTIMONY
and other owners of Sunriver. Being a city carries with it certain
specific comprehensive legal obligations, including the obligation
to comply with land use planning goals and guidelines. The
petitioners have not even begun to make the required showing that
they can comply with those goals. For that reason, if for no
other, the Petition should be denied.
PAGE 11. DAVID BENNETT.TESTIMONY
1993 BUDGET FIGURES
Income
Liquor Tax
Cigarette Tax
Gas Tax
Room Tax - All
Utility Tax
Forest Service
9-1-1 System
TOTAL INCOME
Expenses
Insurance
Administrative Staff
Accounting/Audit
Rent, Postage, Utilities
Planning - All
Police & Fire -New Areas
Dues/Council
City Attorney
Cora/Chamber
Road Maint (Sr./Bus Park)
9-1-1 System
Start Up Expense
Sub Total
Contingency
TOTAL EXPENSES
Petitionerst
Proposed Budaet
$ 13,248
4,960
71,856
1,127,054
291,428
2,475
6,000
$1,517,021
$ 20,000
60,000
23,000
16,200
42,000
1,500
10,000
225,411
35,000
6,000
10,000
449,111
44,911
494,022
08
0904
SROAIs
Projected Budget
$ 13,248
4,960
71,856
1,127,054
2,475
6,000
$1,225,593
$ 20,000
90,000
42,000
16,200
70,000
90,000
1,500
35,000
225,411
35,000
6,000
17,000
648,111.
44,911
693,022
ESTIMATED SURPLUS $1,022,999 $ 532,571
APPENDIX C
0108 9995
Good evening. My name is Dan Clinkenbeard and I am
Secretary/Treasurer of Sunriver Owners Association. I am going to
address what I think you will agree are the inadequacies and
contradictions of the proposed budget.
To set the context of my remarks, I offer two observations:
(1) There is a clear trend in business and government to
merge, consolidate, and centralize in order to eliminate
duplication of staff and services and save money by
reducing costs. Regionalization, not fragmentation, is
becoming the rule.
(2) Areas typically incorporate to obtain essential services
they don't now have - services such as police, fire,
emergency medical, planning, sewer, water, etc. Sunriver
already enjoys a very high level of these services at low
cost.
What this proposal offers is a new level of government with
unnecessary and very expensive administrative and bureaucratic
duplication of existing County and Sunriver Owners Association
services in order to provide new facilities already planned for by
the Sunriver Owners Association to be financed principally with
funds from our new three-phase program. So, let's look at this
budget. I'm not going to address all of the line items; just those
that leap off the page and beg further scrutiny.
Looking at revenues, let's look first at a room tax for
managed and privately rented units - a proposed $1,127,054.00 in
revenues. The problem with this source of income is reliability.
PAGE 1. DAN CLINKENBEARD TESTIMONY
0108 0006
Recognition of this unreliability is implicit in the State of
Oregon's requirement that all new cities have a tax base to provide
a steady and secure income stream through an ad valorem tax.
Common sense tells you that room taxes go down when the economy
goes down. People cancel skiing trips when there is no snow.
Vacations are cancelled when a major fire breaks out. We have seen
these things. Further confirmation is offered by lenders who will
not lend against tax anticipation notes secured by room tax
revenues (or lottery revenues) and bond underwriters who will not
underwrite municipal bonds based on these revenues.
The petition itself gives evidence of the unreliability of
this income, in Paragraph 2, Local Control Enhancement,
Subparagraph b.: "The ability to pass and enforce ordinances to
deal effectively with a multitude of behavioral and other problems
confronting the community." While we don't know what this means,
if, for instance, the City were to restrict short term rentals,
then the City would be legislating away its only source of revenue.
We are not here to argue whether Cannon Beach - style rental
controls are desirable socially, economically or politically.. We
are here to say that petitioners can't have it both ways: For
every dollar of room tax lost because of rental controls, Sunriver
property owners, including residents, will have to pay another
dollar - a new dollar - of ad valorem tax.
Next on the list is utility taxes which would come straight
out of the pockets of the residents and other property owners in
Sunriver in the form of higher utility bills. I have never heard
PAGE 2. DAN CLINKENBEARD TESTIMONY
anyone say they wanted to pay higher utility bills to support an
added layer of non-productive, government -backed bureaucracy so
that they can continue to receive the same level of services. This
new tax is not acceptable to the community and you should not
accept it as a valid source of revenue.
Turning to the expense side, we have compared proposed
expenses with those of two comparable Oregon cities:
Brookings, population 4,450, 35% non-resident ownership; and
Cannon Beach, population 1,260, 80% non-resident ownership
We have sought opinions from the County and others and we have
exercised judgments based on our own experiences. A table showing
these comparisons follows:
Income
Liquor Tax
Cigarette Tax
Gas Tax
Room Tax - All
Utility Tax
Forest Service
9-1-1 System
TOTAL INCOME
Expenses
1993 BUDGET FIGURES
Petitioners)
Prouosed Budaet
$ 13,248
4,960
71,856
1,127,054
291,428
2,475
6.000
$1,517,021
Insurance $ 20,000
Administrative Staff 60,000
Accounting/Audit 23,000
Rent, Postage, Utilities 16,200
Planning - All 42,000
Police & Fire -New Areas -
Dues/Council 1,500
City Attorney 10,000
PAGE 3. DAN CLINKENBEARD TESTIMONY
SROAIs
Pro -i ected Budget
$ 13,248
4,960
71,856
1,127,054
2,475
6,000
$1,225,593
20,000
90,000
42,000
16,200
70,000
90,000
1,500
35,000
0108 0908
Cora/Chamber 225,411 225,411
Road Maint (Sr./Bus Park) 35,000 35,000
9-1-1 System 6,000 6,000
Start Up Expense 10,000 17,000
Sub Total 449,111 648,111
Contingency 44,911 44,911
TOTAL EXPENSES 494,022 693,022
ESTIMATED SURPLUS $1,022,999 $ 532,571
Note that no provision has been made in either budget for municipal
court, prosecutorial or jail services.
Think of this - it will take $1.2 million in tax revenues now
constructively used by the County to provide $.5 million of surplus
for use by the new, larger City of Sunriver whose future boundaries
and financial demands cannot now be estimated.
Also note that the proposal does not recognize that while
expenses begin when the city is incorporated, revenue will not
begin to flow into the city for 90 - 120 days, with no ability to
secure interim financing through tax anticipation notes. Where
will the money with which to run the city during this period come
from?
Let's assume now that the city has survived the start-up
period and is ready to address the requirements of LCDC Goal 11
with the $.5 million we have identified earlier. Page 12 of the
Deschutes County Planning Division Staff Report lists the following
among others: police, fire, and recreation facilities and services,
as minimum facilities and services needed to serve an urban area.
PAGE 4. DAN CLINKENBEARD TESTIMONY
?�08 0909
The Incorporation Feasibility Study acknowledges this on Page 48,
where it says:
The projected revenues of the proposed city are
sufficient to allow construction and maintenance of
additional public facilities (library, conference center,
etc.) by the proposed city. These revenues are also
sufficient to allow assumption by the proposed city of
some of the public facilities and services now being
provided by SROA.
So, they are proposing to use surplus funds of $.5 million to
provide over $1.2 million in police and fire services and build all
of these new facilities. What nonsense! The only way this city
can function is with concurrent establishment of a tax base and
immediate implementation of an ad valorem tax. The residents of
Sunriver who may be voting on incorporation deserve to know what
their tax base and their tax rate will be.
This proposal seeks financial legitimacy by deferring
consideration of the costs of implementing LCDC Goals and
Requirements until development of the City Comprehensive Plan -
after the incorporation election. There are tremendous financial
risks to present Sunriver owners associated with incorporating new
areas into Sunriver. Without ad valorem tax, revenues cannot grow
as new demands for city services grow and the residents of today's
Sunriver will pay for all of these new costs and residents or
business owners in these new areas will pay nothing! How does this
benefit the present owners of Sunriver?
Not only is this proposal founded on impossible economics, it
provides no services or facilities to Sunriver that are not now
provided by Sunriver Owners Association and the County, or provided
PAGE 5. DAN CLINKENBEARD TESTIMONY
0108 0910
for in our new three-phase program. We believe it does not
adequately disclose the future financial risks it poses to present
Sunriver owners and that it does not meet the sensible requirements
of Oregon law for reliable ad valorem tax based financing. We urge
you to reject it.
PAGE 6. DAN CLINKENBEARD TESTIMONY
APPENDIX D
0108 0911
Good evening, Commissioners. My name is Mike Kelley. I am a
homeowner, business owner and resident of Sunriver. I am also a
member of the Sunriver Owners Association Board of Directors. At
the outset, I would like to stress that while municipalities and
homeowners associations co -exist without strife throughout the
United States, it is important for everyone, both pro and con, to
acknowledge that the incorporation of Sunriver will result in
change. The proposed economic feasibility study seems to de-
emphasize change and in fact seems to imply that running Sunriver
will be business as usual.
From a practical standpoint, many of the proposals within the
economic feasibility study are assumptions that in fact, and maybe
in law, will not work at all. I would like to bring these areas to
your attention.
The proposed economic feasibility study indicates that the
primary municipal services of police, fire, emergency, and road
maintenance will continue to be provided by Sunriver Owners
Association either directly or under contract to the city. The
proposed city boundary contains an area (Sunriver Business Park)
which is not part of the Sunriver Owners Association.
Additionally, if you follow the recommendations of your staff, you
will be altering the proposed city boundaries to include other
areas which also lie outside the jurisdiction of Sunriver Owners
Association. In either of these cases, the petitioners assume that
the Sunriver Owners Association will provide the essential
municipal services. I am here to tell you firstly, that Sunriver
PAGE 1. MIKE KELLEY TESTIMONY
0.08 0912
Owners Association has not said that we will provide such services.
Secondly, we do not know if we have the manpower or equipment
capacities to provide such services. Thirdly, we highly doubt if
our membership will even give us the authority to provide the
services to an entity which they will perceive as taking away
substantial rights from them. In any event, we will be obliged to
check with the entire membership before we can proceed with any
contracts with the proposed city.
It is interesting to note that the owners of the Sunriver
Business Park at one time rejected an opportunity to be covered by
the municipal services of the Sunriver Owners Association because
they were unwilling to become subject to the auspices of the
Sunriver Owners Association Design Review Committee. Should they
become part of an incorporated city of Sunriver, and should that
city find some provider willing to deliver services to the area,
they will begin to receive these municipal services absolutely free
of charge since no ad valorem taxes are proposed to be collected by
the proposed city. Further, the owners of these non -Association
properties do not pay into the Sunriver Owners Association
maintenance fund. The provision of the free services will
presumably also be granted to any other areas which you choose to
include in the city boundaries.
We already have two layers of government in Sunriver -
Deschutes County and Sunriver Owners Association. The addition of
a third will add significant confusion and cost to the residents
within Sunriver, and for that manner, all residents in the county.
PAGE 2. MIKE KELLEY TESTIMONY
0108 0913
Who will be responsible for what? What planning will be done by
Sunriver Owners Association? By the city? The County? What
rules, laws or ordinances will prevail and when and where will they
prevail?
Even if there is a perfectly clear understanding among the
bureaucracies, I doubt if the average citizen will ever get it
right the first time. More importantly, a resource precious to the
Sunriver Owners Association will be diluted by the incorporation.
Namely, only a limited number of people within any community are
willing to be involved with civic or association matters. The
creation of another body creates more competition for the
relatively few leaders in the community.
What is really accomplished by incorporation? This issue has
already generated a great deal of expense, divisiveness, and
controversy within our community. It has diverted our energy and
resources from other challenges and tasks which need attention.
Why do areas tend to incorporate? Most often, to obtain
services they don't now have. Yet, in this case, police, fire,
emergency, water, sewer and planning already exist. Moreover, the
incorporators have proposed that such services be delivered by
existing providers over whom the city would have no control.
It might make sense to incorporate if the same quality of
service could be achieved at a lower cost. Yet, the petitioners do
not project lower cost. In fact, they have not even consulted with
Sunriver Owners Association, Sunriver Utilities, or the County
before filing the petition to see what costs might be. In
PAGE 3. MIKE KELLEY TESTIMONY
0.108 0914
virtually every case, the total costs to the citizens definitely
will increase. Planning, administration, and bureaucratic
duplication of County services add costs yet produce no additional
value. Sewer and water rates will increase as taxes are levied.
Fire and police costs will go up as a result of state and federal
laws and regulations which did not apply under the Sunriver Owners
Association. Judicial, prosecutorial and jail services which must
be provided will cost money and were not even addressed by the
petitioners.
All the additional costs will be paid for primarily by room
tax revenues. Not new money, simply money coming out of the pocket
of all county taxpayers and going to pay for duplicate services
without any value being added.
LCDC Goal 10 (Housing) requires that certain types of density
housing be provided for when the city population exceeds 2,500.
According to a study commissioned by the Board of Directors of
Sunriver Owners Association and prepared by David Evans and
Associates in April of 1991, the population of Sunriver will exceed
the 2,500 level within three years after the earliest possible date
for the formation of the proposed city (May 1992). With the
inclusion of the Business Park and its apartment complex in the
proposed city boundaries and with the possible inclusion of other
benefited areas, the population could exceed 2,500 in a much
shorter time frame.
Even with this short time frame, the petitioners have chosen
not to address this issue. Rather, they propose to address it in
PAGE 4. MIKE KELLEY TESTIMONY
VO -109 0915
the city comprehensive plan after the city is formed. This
approach deprives the potential voters of all the facts they need
to make an intelligent decision with respect to the proposed city
formation. Given the development restrictions of the Sunriver
Consolidated Plan, it is likely that the areas within the city's
boundaries, but outside the boundaries of the existing Sunriver
development, would be used to meet the Goal 10 requirements for
high density, lower cost housing. With the boundaries of the city
unknown, with the required housing density, and the rapid growth in
south Deschutes County, it is certainly feasible that within a five
year time frame there will be more city voters outside the
boundaries of the Sunriver Owners Association than there will be
within the boundaries. This is local control of a sort, but not the
kind of local control that petitioners have been promising Sunriver
residents.
Since Sunriver is surrounded on three sides by National
Forest, all growth must be to the south. The areas immediately to
the south already have many known problems with substandard road,
construction, septic and water service. It will ultimately be the
job of the newly formed municipality to deal with these problems.
Therefore, an ad valorem tax must be enacted to generate the needed
funds the financial burden is likely to fall primarily on the
property owners of Sunriver Owners Association, since the assessed
values of their property is extremely high relative to that of the
land south of Sunriver.
PAGE 5. MIKE KELLEY TESTIMONY
Although the petitioners have tried to sidestep these issues,
the residents of Sunriver Owners Association deserve to know the
facts; the practical consequences of incorporation. There will be
change: more government, probably fewer services, the probable loss
of local control, and a much different kind of Sunriver than we
have today. We urge you to deny the Petition.
PAGE 6. MIKE KELLEY TESTIMONY
APPENDIX E
0.08 001'
Good evening, Commissioners. My name is Ann Porter. I am a
member of the Board of Directors of the Sunriver Owners Association
and a non-resident property owner.
As a non-resident property owner, I can only interpret the
proposed incorporation as a loss. For non-resident owners, there
will be a number of losses:
• Loss of a voice in local control, because the
incorporation will effectively disenfranchise us;
• Loss of property values; and
• Loss of property rights.
In the past, when owners have purchased property in Sunriver,
they have been assured membership in the Owners Association. That
membership included (1) the right to vote (to elect Board members
and to vote on special issues; (2) the opportunity to testify and
participate in local decision making; and (3) so far, an ever
growing increase in owners' property values.
Now, non-resident owners are being threatened with a loss of
voting rights. Only residents will be permitted to vote. There
are 4,000 properties in Sunriver, 85% of which are owned by non-
residents, and 15% which are owned by residents. If we assume there
are two voters per property, then the residents represent
approximately 1,200 owners eligible to vote in a city out of
approximately 8,000 total owners. Even assuming that every single
eligible voter were to vote, a simple majority of that number is
601. Therefore, 601 persons could vote to incorporate and
PAGE 1. ANN PORTER TESTIMONY
0108 0918
simultaneously disenfranchise the other 7,399 people. I call that
situation minority rule.
Now, non-resident owners are being threatened with no
participation in local control and planning. We now own private
facilities, e.g., open areas, tennis courts, a swimming pool, bike
paths, and streets through our owners association. As members of
the Sunriver Owners Association, we have guaranteed rights and
protections. A city would have planning, zoning and eminent domain
powers. What will happen to our "Consolidated Plan", the plan
guaranteed to us when we became property owners?
Now, non-resident owners are being threatened with the
possible reduction of property values. Who wants to buy property
where the planned community is now being run by a "skeleton" city
government? Who wants to buy property where the rates and amount
of taxation are unknown and where no one knows which entity, if
any, will provide needed services?
Now, non-resident owners are being threatened with a loss of
property rights. Under the current Consolidated Plan, owners know
what they can and cannot do with their property. They know the
rules and regulations for renting their property. Under the
proposed incorporation, those rules may change. There may be
different rules about rental control in which I, as a non-resident
owner, will have no voice. Now we have a consistent level of
quality and design due to the Consolidated Plan. What will we have
then?
PAGE 2. ANN PORTER TESTIMONY
with
0108 0919
In one fell swoop, we non-resident owners are being threatened
a loss of voting rights,
a loss of a voice in local matters,
a loss of property values, and
a loss of property rights.
We are being requested to finance our own disenfranchisement,
and to provide services for free to the people who benefit from our
loss. Do not assume that the 850 of the owners who are non-
resident will permit the Owners Association to comply with that
request.
For the reasons stated above, I know you can conclude that the
petition for incorporation is fatally flawed. I ask that you deny
this petition. Thank you.
PAGE 3. ANN PORTER TESTIMONY
APPENDIX F 0108 0920
REN LUDLOW / CLOSING REMARKS
There are numerous problems with the Petition for
incorporation that has been submitted to you. Any one of these
deficiencies is legally enough for you to deny the Petition. As you
have heard, some of these deficiencies are technical in nature,
some of them reflect at least a lack of information that the
petitioners are obliged to provide both to you and to the people
that the petitioners are asking to vote in favor of incorporation,
and still others are financial or practical. As you consider this
Petition, you will obviously need to consider each of these issues,
which will undoubtedly be the subject of further debate and
argument.
We also ask, however, that you step back from the detail, from
the technical aspects of each particular issue, and that you
reflect on the petitioners' proposal as a whole. When you do, we
believe that you will recognize the Petition as an attempt to
create a simple shell of a city in order to capture county room tax
revenues.
This proposal has not been prompted by a genuine desire to
provide needed services where none exist. This proposal is not
motivated by a desire to increase the level of municipal services.
Indeed, the proposed municipality cannot assure even a minimal
level of services to the new areas that are not already receiving
them from independent providers over whom the city would have no
control. The asserted argument for local control, when viewed in
PAGE 1. KEN LUDLOW CLOSING REMARKS
0108 0921
light of land use and other legal requirements, simply does not
make sense. It is not in the best interests of the county at
large, and it is not in the best interests of the residents of the
proposed city to create an additional layer of government that will
do nothing except soak up valuable room tax revenues in order to
create a new bureaucracy. For all these reasons, we urge you to
reject the Petition.
PAGE 2. KEN LUDLOW CLOSING REMARKS