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2002-108-Minutes for Meeting February 06,2002 Recorded 2/14/20021130 N.W. Harriman St., Bend, Oregon 97701-1947 (541) 388-6570 • Fax (541) 388-4752 www.deschutes.org Tom De Wolf Dennis R. Luke MINUTES OF MEETING Mike Daly DESCHUTES COUNTY BOARD OF COMMISSIONERS WEDNESDAY, FEBRUARY 6, 2002 Homestead Building, Sunriver Present were Commissioners Tom De Wolf, Dennis R. Luke and Michael M. Daly. Also present were Mike Maier, County Administrator; Rick Isham and Laurie Craghead, Legal Counsel; Paul Blikstad, Community Development; Jenny Scanlon, Commissioners' Office; Les Stiles and Larry Blanton, Sheriff's Office; Media Representatives Libby Beauvien of Z-21 TV Mike Cronin of the Bulletin; Brooke Snavely, Sunriver Scene; Barney Lerten of bendnet. com; and approximately 150 citizens. The meeting was held in Sunriver at the Homestead Building in order to accommodate citizens who wished to attend the meeting, as two issues of interest to citizens in the greater Sunriver area were on the agenda. Chair Tom De Wolf opened the meeting at 10: 00 a. m. 1. Before the Board was Citizen Input. None was offered. 2. Before the Board was a Decision and Consideration of Signature of Order No. 2002-026, Regarding Whether to Hear an Appeal of the Hearings Officer's Denial of File No. CU -01-93 (Well Drilling Business -Home Occupation in an RR -10 Zone). Paul Blikstad gave a brief overview of this issue for the benefit of the audience members who were not familiar with the appeal and hearing process. Minutes of Board of Commissioners' Meeting Page 1 of 6 Pages Wednesday, February 6, 206'2 uality Services Performed with Pride LUKE: Move signature of Order No. 2002-026. DALY: Second. VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes no. 3. Before the Board was a Decision and Consideration of Signature of Order No. 2002-027, Regarding_Whether to Hear an Appeal of the County Hearings Officer's Decision of CU-01-83/SP-01-52 (Regarding Commercial Activity in Conjunction with a Farm Use - Applicant. Gary Brian). Paul Blikstad explained that this issue is similar to the previous one, and gave a brief overview of the appeal. DEWOLF: Move approval of Order No. 2002-027. DALY: Second. VOTE: LUKE: No. DALY: Yes. DEWOLF: Chair votes yes. 4. Before the Board was a Final Public Hearing and Consideration of Signature of Order No. 2002-025, Regarding the Formation of the Spring River Special Road District. This item was moved toward the end of the agenda. 5. Before the Board was a Public Forum on the Formation of the Sunriver Service District. This item was moved to be the last item on the agenda. Before the Board was Consideration of Approval of the Consent Agenda. LUKE: Move approval of the Consent Agenda. DALY: Second. Minutes of Board of Commissioners' Meeting Page 2 of 6 Pages Wednesday, February 6, 2002 J VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. Consent Agenda Items: 6. Approval of the Four Rivers Vector Control Annual Work Program for 2002; 7. Chair Signature of an Oregon Liquor Control License Application for the Tumalo Store, Bend; 8. Signature of a Letter Reappointing Kendal Shaber to the Deschutes County Commission on Children and Families through December 31, 2005; and 9. Chair Signature of Oregon Health Division Grant Revision #5, Adding Revenue to Various Health Programs. CONVENED AS THE GOVERNING BODY OF THE 9-1-1 COUNTY SERVICE DISTRICT 10. Before the Board was Consideration of Approval of Weekly Accounts Payable Vouchers for the 9-1-1 County Service District in the Amount of $246.51. LUKE: Move approval, subject to review. DALY: Second. VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. CONVENED AS THE GOVERNING BODY OF THE EXTENSION/4-11 COUNTY SERVICE DISTRICT 11. Before the Board was Consideration of Approval of Weekly Accounts Payable Vouchers for the Extension/4-11 County Service District in the Amount of $1,713.49. LUKE: So move, subject to review. DALY: Second. Minutes of Board of Commissioners' Meeting Wednesday, February 6, 2002 Page 3 of 6 Pages VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. RECONVENED AS THE DESCHUTES COUNTY BOARD OF COMMISSIONERS 12. Before the Board was Consideration of Approval of Weekly Accounts Payable Vouchers for Deschutes County in the Amount of $858,883.90. LUKE: Move approval, subject to review. DALY: Second. VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. 13. ADDITION TO THE AGENDA None were offered. 4. Before the Board was a Final Public Hearing and Consideration of Signature of Order No. 2002-025, Regarding the Formation of the Spring River Special Road District. Laurie Craghead gave an overview of the issue, which originated in November; this is the final hearing. The Board of County Commissioners must decide whether to allow this to go onto the May ballot, using land use criteria for their decision. She explained a letter has been submitted questioning if this does fit land use criteria, and the letter has been made a part of the record. The Oregon Department of Revenue has given their approval of the legal description and map. If the district is formed, it will put into place a tax rate of $.94 per thousand to be used for road purposes. Chair Tom De Wolf then opened the public hearing. Minutes of Board of Commissioners' Meeting Wednesday, February 6, 2002 Page 4 of 6 Pages F3 Carol Jansen, Bob Anderson, Dave Wilkins, Ray Hamidde and Jens Jorgensen then testified. Their testimony, which was taken by a court recorder, is attached as Exhibit A. Being no further testimony offered, Chair Tom DeWolf closed the public hearing. Commissioner Luke explained to the audience that a positive vote by the Board does not put the district into place; it merely allows this to go forward to a vote of the people who would be affected by it. Chair DeWolf added that it would allow the folks in the district to discuss and learn more about the issue over the next few months, prior to the election on May 21. LUKE: I move approval of Order No. 2002-025. DALY: Second. VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. 5. Before the Board was a Public Forum on the Formation of the Sunriver Service District. Laurie Craghead gave an overview of the proposed formation and its purpose. The Commissioners also explained the nature of a county service district. Chair DeWolf then opened the public forum to receive testimony. Mike Brannan, Gary Fiebick, Shirley Mildes, Jim Henshaw, Randy Ebertson, York Richardson, Hans Abrams, Don Edwards, Jim Kreiss, Dave Ghormley, Peter Martin, Tom Gunn, Penny Bennington, Bob Foster and Tom Luersen then testified. Chair DeWolf had to leave the meeting just prior to the testimony of Penny Bennington. He indicated he planned to read the minutes of the remainder of the meeting so that he would be familiar with the testimony he was not able to hear first-hand. Minutes of Board of Commissioners' Meeting Wednesday, February 6, 2002 Page 5 of 6 Pages After the conclusion of citizen testimony, at the request of Tom Luersen (a partner in Sunriver Limited Partnership), Sheriff Les Stiles provided a brief history of the reasons behind this proposed formation. Gary Fiebick, General Manager of Sunriver, then provided the audience with some details regarding current and proposed tax rates, current and proposed homeowners' dues, and other information regarding the financial aspects of the proposed service district. The testimony that was given, which was taken by a court recorder, is attached as Exhibit B. Being no further items brought before the Board, Acting Chair Mike Daly adjourned the meeting at 12:10 a.m. DATED this 6th Day of February 2002 for the Deschutes County Board of Commissioners. ATTEST: , Recording Secretary Tom DSNYolf, Chair is R. Luke, r �,. o" s ZXX'O'" r14 0 ( Mich el M. 15ali,C missioner Minutes of Board of Commissioners' Meeting Page 6 of 6 Pages Wednesday, February 6, 2002 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DESCHUTES COUNTY BOARD OF COMMISSIONERS 10:00 A.M. WEDNESDAY, FEBRUARY 6, 2002 THE HOMESTEAD BUILDING, 57085 MEADOW ROAD SUNRIVER, OREGON Cascade Court Reporters 541-385-5664 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 2 SUNRIVER, BEND; WEDNESDAY, FEBRUARY 6, 2002; MS. CRAGHEAD: For the record I am Laurie Craghead, Assistant Legal Counsel. Just some background on this. As the Chair said, this is the final hearing for this Spring River Special Road District. The petition was filed in November, and the initial hearing was on January 3 for this hearing for this district. At that time under the statute the Board needs to either approve or disapprove of the petition based on land use criteria, and we had a letter that was submitted in the record from the CDE department regarding whether or not this application complied with the county's comp plan and the statewide planning goals. And the Board adopted that document as well and they voted to approve the petition. The state statutes requires then a final hearing on the matter, and then that's what this is. And there are maps if anyone hasn't gotten one that's here for this. There are maps in the back on the back table. The maps have been submitted to the Department of Revenue, and we have got a preliminary approval of these maps in the legal description. They are slightly different than the maps in the legal description that were approved at the initial hearing because the Department of Revenue wanted a little bit different map and wording and so we have gotten those. Cascade Court Reporters 541-385-5664 14 15 16 17 18 19 20 21 22 23 24 25 3 COMMISSIONER LUKE: And this is the Spring River Road District which is out Spring River Road out on the right-hand side after you cross the Deschutes, and they are going to go to a public election to see if they want to tax themselves'to maintain the roads MS. CRAGHEAD: Right. And the assessment would be $0.94 per thousand assessed value and with an estimate of the first year possibly raising $13,270. COMMISSIONER DE WOLF: What I would like to explain is sort of the way that we operate in public hearings, and this will apply to both this and the public hearing that will follow immediately after this one. Anyone who wishes to testify needs to come up to the microphone. This is being taped as well as a court reporter recording this information as well. You need to state your name clearly at the beginning of your testimony, and you need to spell your name. Unless it's Smith.or Jones, you need to spell your name for the record. We require that everyone remain civil to towards each other even when we disagree with each other on these issues. And anyone in my opinion who is not remaining civil I will stop your testimony. We would ask that you stick to the point, keep it as brief as you can while making your point, and that there is no need to repeat what other people have said so that we can all get Cascade Court Reporters 541-385-5664 i 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 3 COMMISSIONER LUKE: And this is the Spring River Road District which is out Spring River Road out on the right-hand side after you cross the Deschutes, and they are going to go to a public election to see if they want to tax themselves'to maintain the roads MS. CRAGHEAD: Right. And the assessment would be $0.94 per thousand assessed value and with an estimate of the first year possibly raising $13,270. COMMISSIONER DE WOLF: What I would like to explain is sort of the way that we operate in public hearings, and this will apply to both this and the public hearing that will follow immediately after this one. Anyone who wishes to testify needs to come up to the microphone. This is being taped as well as a court reporter recording this information as well. You need to state your name clearly at the beginning of your testimony, and you need to spell your name. Unless it's Smith.or Jones, you need to spell your name for the record. We require that everyone remain civil to towards each other even when we disagree with each other on these issues. And anyone in my opinion who is not remaining civil I will stop your testimony. We would ask that you stick to the point, keep it as brief as you can while making your point, and that there is no need to repeat what other people have said so that we can all get Cascade Court Reporters 541-385-5664 E E 8 C J 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 1 through this. There are a lot of people here today. I don't 3 know how many will end up testifying between these two ! hearings. But if we all stick to that and stay to the point and remain civil to each other which I know everyone will in this room, we are going to be in great shape. Dennis. COMMISSIONER LUKE: Questions are appropriate too. If you come up and you just have a question you want to ask, you still need to get on the record and we will do our best to get an answer for you. COMMISSIONER DE WOLF: It's real important that we get everyone on the tape so we have an accurate record of what was said here today. And so I will now open the public hearing regarding Order 2002-025 regarding the formation of the Spring River Special Road District. And I have got three people's names who want to testify. And if there are others at the end of that, we will certainly give you the opportunity. Carl Jansen, you are first. MR. JANSEN: Good morning. My name is Carl Jansen, C -a -r-1 J -a -n -s -e -n. I'm a resident on Bessen Road, I am part of the Spring River Road Association which is a voluntary group at the present time. I am basically the road coordinator for the road maintenance activities, and I thought I would at least provide some input to you as Cascade Court Reporters 541-385-5664 M 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 5 to one of the reasons for the urgency of having this special road district adopted by the voters. We have 87 owners, lot owners, in the Spring River Road Association area which is Cooper and Bessen and the adjoining roads. We sent out invoices to everyone to contribute towards the road maintenance activities in October of last year. We have 87 owners. 19 of these owners at the present time have not paid. We sent out two invoices over the last two months, and basically we're looking at nonpayment of about $2,500 which is rather critical to maintain these roads. So what we are doing as far as the special road district and having a levy against the properties is to increase our income. We have had this problem on an ongoing basis for years. This is strictly a voluntary group, and right now a lot of these people that haven't paid are basically nonresidents in the area. They own property here, use our roads, but they are not paying for the maintenance of the roads. So it kind of gives you an idea that we need this road district adopted on the May election. COMMISSIONER DE WOLF: Thank you, Carl. Bob Anderson. MR. ANDERSON: Good morning. I'm Bob Anderson. That's with an o -n, please. I am opposed to the road Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 I district that you are trying to form. Mainly because in the last 25 years we have gotten along with plowing the road on the dirt road, and now all of a sudden we want to pave the road. Now, the reason they want to form the district is to borrow the money, $50,000 or more, from the bank which we don't have that kind of money in our district. We have only got about 30 full-time residents that live at the area. Now, some of the people that don't pay only come up in the summer or whatever, and we have gotten along paying $60 a year. Now this is going to jump all our taxes. It's going to jump mine about 500 percent. I'm going to go from $50 to $60 a month to over $300 a month just so -- COMMISSIONER LUKE: Is that a month or a year? MR. ANDERSON: A year. Excuse me. And I think it's just -- it's way out of line for the amount of people that are there, for the 30 people. The few people that want the road paved are trying to influence the other 60 people who don't get to vote and they don't get a say in it. I don't think it's right. Thank you. COMMISSIONER DE WOLF: Thank you. MR. WILKINS: Good morning. For the record I am Dave Wilkins, last name spelled W -i -1 -k -i -n -s. I am a full-time resident at 17061 Cooper Drive and my house just Cascade Court Reporters 541-385-5664 .r i 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 2E happens to be in the Spring River Association area. As Carl eloquently pointed out, we are experiencing some difficulty trying to collect the fair share of the other people who own property in the Spring River area. That was our primary purpose of establishing this association. It's also gotten to the point now, Commissioners, that there is a safety issue if the roads aren't plowed properly that there could be some problems getting some vehicles down to the end of these areas that we are trying to plow adequately, but it's difficult to do so with the current money that we have available. So I look at it as a good thing for the community and a good safe responsible thing to do as well so I support it. COMMISSIONER DE WOLF: Great. That's all I have on my list. Are there any others that would like to testify on this matter? Yes. Come on up. MR. HAMMITT: I am Ray Hammitt. That is spelled H -a -m -m -i -t -t. I am a resident of the Spring River Road District and I'd like to dispute Bob Anderson's testimony. He stated that he pays $50 a year or assessment is $150 a year this last year. And right now we are running out of money because some people have not paid. And because of the high volume of snow we have had this year, we are running out of money to plow the roads there, and it's mainly because of people that don't pay there. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 x And I know a large part of those people come in during the wintertime and use those roads during the wintertime there, and they should be responsible for paying their share. And that's all I have to say. I am in favor of the formation of the road district. Thank you. COMMISSIONER DE WOLF: Thank you. Anyone else? MR. JORGENSEN: I put my name on the list back there. COMMISSIONER DE WOLF: This is the Spring River. COMMISSIONER LUKE: You may have put your name on the other one. You are welcome to testify. COMMISSIONER DE WOLF: Come on up. MR. JORGENSEN: My name is Jens Jorgensen. The first name is spelled J -e -n -s, J -o -r -g -e -n -s -e -n. I live on 17090 Cooper Drive. We have had a residence there for the last 15 years. And the road maintenance have been sort of spotty, and the previous speaker I think pointed out that not everybody is paying. And my neighbor James Vadheim, they are also in favor of setting up a special road district so that we can in fact have a continual income and that we can do some serious planning about how to upgrade the roads and how to take care of them and how to plow them. So I hope that the Commissioners will act very favorably upon this request. Thank you. Cascade Court Reporters 541-385-5664 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 rl 9 COMMISSIONER DE WOLF: Thank you. Anyone else? Okay. I will close the public hearing. COMMISSIONER LUKE: Again this motion will be to approve Order No. 2002-025. This is not an endorsement of the road district or a nonendorsement of the road district. It just allows us to go to a vote and let the district people decide. COMMISSIONER DE WOLF: And I agree with Dennis that what we are doing is allowing the folks on both sides of this issue to discuss this over the next -- when is the election? May 21. Over the next three months or so and determine for yourselves what's the best way to proceed and do that in an election which is what we do in this country. COMMISSIONER DALY: I second. COMMISSIONER LUKE: I made a motion. COMMISSIONER DALY: I second. COMMISSIONER DE WOLF: Commissioner Luke? COMMISSIONER LUKE: Yes. COMMISSIONER DE WOLF: Commissioner Daly? COMMISSIONER DALY: Yes. COMMISSIONER DE WOLF: Chair vote is yes. The next item on o agenda is a public forum rather t a public hearing on the ormation of the S Iver Service District. Laurie. MS. DRAG Again the record, Laurie Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DESCHUTES COUNTY BOARD OF COMMISSIONERS 10:00 A.M. WEDNESDAY, FEBRUARY 6, 2002 THE HOMESTEAD BUILDING, 57085 MEADOW ROAD SUNRIVER, OREGON Cascade Court Reporters 541-385-5664 1 WO 1 COMMISSIONER DE WOLF: Thank you. Anyone else. Okay. I will close the public hearing. 3 COMMISSIONER LUKE: Again this motion w' 1 be 4 to approve Order No. 2002-025. This is not an e orsement 5 of th road district or a nonendorsement of t e road 6 district It just allows us to go to a vo e and let the 7 district pe ple decide. 8 C ISSIONER DE WOLF: d I agree with Dennis 9 that what we are oing is allowi the folks on both sides 10 of this issue to di uss this ver the next -- when is the 11 election? May 21. Ov t e next three months or so and 12 determine for yourselve at's the best way to proceed and 13 do that in an electi n which is what we do in this country. 14 COMMI SIGNER DALY: I second. 15 C ISSIONER LUKE: I ade a motion. 16 COMMISSIONER DALY: I se nd. 17 COMMISSIONER DE WOLF: Comma sioner Luke? 18 COMMISSIONER LUKE: Yes. 19 COMMISSIONER DE WOLF: Commission Daly? 20 COMMISSIONER DALY: Yes. 21 COMMISSIONER DE WOLF: Chair vote is ye The 22 next item on our agenda is a public forum rather than a 23 public hearing on the formation of the Sunriver Service 24 District. Laurie. 25 MS. GRAGHEAD: Again for the record, Laurie Cascade Court Reporters 541-385-5664 f c 1C 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 10 1 Craghead, Assistant Legal Counsel. This would be a 2 proposed formation of county service district -- 3 COMMISSIONER DE WOLF: Could we ask that you I take the conversations outside, Gentlemen. Thanks. MS. CRAGHEAD: -- that would be established covering the Sunriver resort area. The name of the district would be the Sunriver Service District, and the purpose would be provide services of fire prevention and protection, security services by contract, law enforcement services, and emergency medical services, and there are all statutory references to that. If approved, this measure would authorize this district would also have a permanent tax limit of -= right now it's proposed at 3.95 per thousand assessed value. And so that would be starting with the tax year of 2002, 2003. The governing board of this service district will be the Board of County Commissioners which is the county service district. Some history behind this. This was a district that the homeowners association board brought to the County Board of Commissioners asking them to initiate this and they did so. And we had an initial hearing on January 9, and then we originally had a hearing scheduled for today. But there was some paperwork things that needed to be done so we had to postpone it to the 13th. But the Chair said Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 11 because of the court reporter we will be entering the transcript into the record at the hearing next week for anybody who testifies today so that it will be a part of the official record and so that you will be considered to be participating in that hearing. And one thing I did mention at the last hearing is the criteria for the Board's considerations are will the area be benefited by a district, and then also did it comply with the land use regulations. And we again had at the initial hearing the submittal into the record of the SSD assessment and facts regarding the compliance with both the county and state land use regulations, and you adopted that at the initial hearing and again at the initial.hearing approved the formation of the district which is under statute -- it's odd. You approve the formation at the initial hearing and then have a final hearing in case there's any changes. COMMISSIONER LUKE: I have a question of staff. We received a letter that will be put into the record from Philip Rastle. One of the things he mentioned with some other things I think will be answered in today's hearing -- but one of them says residents in adjacent communities of Sunriver would have a vote. And the people who vote are just within the Sunriver community. Is that not true? MS. GRAGHEAD: Yes. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 COMMISSIONER DE WOLF: Within the district boundaries? 12 COMMISSIONER LUKE: Within the district boundaries which will be Sunriver. COMMISSIONER DE WOLF: Prior to that this same gentleman said that we ought to poll the nonresident owners as to their feelings on the proposed SSD, and I just wanted to respond to.that. That's something that we would not do. That's one of the deals about the way that elections work in this area and across this nation is that registered voters within the prescribed area in which a decision is being made are the ones making the choice. And people who chose to own a home here and not live here, that's one of the disadvantages that they accept in so doing is that they don't get to vote on elections within this district unless they have registered to vote in this district. So I wanted to clear that up. And one additional question, Laurie, is that this is proposed at $3.95 for a tax rate. Does this board have the authority to change that tax rate? MS. CRAGHEAD: Yes. COMMISSIONER DE WOLF: Before putting this out for a vote? MS. CRAGHEAD: You would change that at the final hearing on the final order. This is just the Cascade Court Reporters 541-385-5664 C E 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 13 proposal at the initial hearing, and that's one of the ' reasons I think we're having a final hearing and things change between the initial. For example, like on the last one we had to change the maps and legal, change the tax rate on this. COMMISSIONER DE WOLF: And I will just tell you what I am really interested in hearing about personally -- I have not talked with my colleagues about this -- is this represents in my opinion quite a large increase in the annual amount of money that people pay for these services. And so what I am going to want to hear that if somebody is going to be paying -- I don't know what it ends up being, 150, $200 more in an annual basis. What are people getting for that extra money? And if not, would it make sense for their rate to be different? So as people testify, those that have knowledge of this particular aspect of it, that's something that I am interested in. That hasn't become clear to me how all that extra money, the justification for that. Anyone have anything else to add? COMMISSIONER LUKE: No. COMMISSIONER DE WOLF: We will now open the public hearing on order -- excuse me -- the public forum on this formation of the Sunriver Service District. COMMISSIONER LUKE: I think I speak for all Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 14 the Commissioners. We want to thank Sunriver for providing this room. This is a beautiful room and for the sound system and everything else that's here. This makes a very nice place to have a public hearing. COMMISSIONER DE WOLF: In fact, Rick Isham, our county counsel, and I were talking at the beginning of the meeting and we have decided to remodel our board room to match this. And when The Bulletin complains that we are being too fancy, we expect real strong support from Sunriver following your lead on this. COMMISSIONER LUKE: I believe this is private funds that did this and not public. COMMISSIONER DE WOLF: So now I know what we can do with the extra money from this road district. The first person that I have on the list is Mike Brannan. MR. BRANNAN: Thank you. Good morning. My name is Mike Brannan, B -r -a -n -n -a -n, and I am a permanent resident of Sunriver. I am speaking on behalf of the Sunriver board of directors. I am vice president of the board, and this board spent a lot of time since last summer when we had an advisory vote with regard to the setting up of a district. That advisory vote was for different reasons than why we are now asking the Board of County Commissioners to consider this district. At the time we had -- in the years past we had Cascade Court Reporters 541-385-5664 L E i E 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 15 L an ad hoc committee developing our long range plan to look at the future of Sunriver, where we were going, where did 3 we want to be, and the consensus of that study was that the E vast majority of Sunriver residents and property owners wanted to stay the same as we are and maintain property values and try to maintain the atmosphere, the ambiance, that exists in Sunriver. So it was logical for owners at that time when the option was should we form a district which the reason for that was to enhance the retention of our fire and Police personnel through their ability to be eligible for PERS membership, et cetera, or should we stay the same, and that's exactly the way it was written on that ballot. Only 1,800 of the 4,100 property owners in Sunriver -- and those are not all residents of Deschutes County obviously -- voted on that and that particular election failed at 54 percent of those who did send in their ballots. Since that time or about the same time that those ballots were out, our board took some position on that issue. We learned from Sheriff Stiles that he was concerned about the commissioning of our police department, and ensuing meetings with the Sheriff's office we learned the reasons for his discomfort with that'and could understand. And after a lot of soul searching on our part, Cascade Court Reporters 541-385-5664 I C E 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 16 L as a board of directors we basically came to the conclusion that the only way we could stay the same was to form a district because that way our police department could remain as it is now, that is, a fully functioning authorized police department. Because if the Sheriff chose to pull the commissions of our police, they would have no authority as police. And since our homeowners did want to maintain our police as we were, that was our way of doing it. And since then the Sheriff has stated that, yes, this is a logical and viable way to accomplish that. Thus we unanimously as a board came to your commission to ask that this be put on the May ballot. Now, as far as the tax rates are concerned -- and I would say this only for the benefit of our homeowners here. And if I am stating it wrong, I hope someone will correct me. But the currently stated tax rate of 3.95 is the upper limit. You can not exceed that once you are there. It's not what's going to be taxed on a first year basis. Our board and our finance committee have been looking at those expenses, and frankly we see the first year's rates probably in the neighborhood of $3.00 and probably a little bit over that. And we want to go over these numbers with the Board of County Commissioners and with your treasurer and make sure we are on the right Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 17 track. But we see the rate being no where near 3.95, and we projected our numbers out for quite a long ways. COMMISSIONER DE WOLF: I guess that's what troubles me is all districts operate with a maximum tax rate. To my knowledge this board is the only municipality or district of any kind in the State of Oregon that for a couple of years levied less than the full amount of it's tax rate. And once you have a tax rate, there is nothing that prevents the governing board from levying that full tax rate. And that's -- I mean my sense is if I am a voter down here, that would be my biggest concern. Okay. We are going to only levy $3.00, but we have the authority to levy 3.95. So if you only need 75 percent of that, then why not establish the $3.00 as your permanent tax rate? MR. BRANNAN: Thank you very much. That is exactly what our thinking is. COMMISSIONER LUKE: There is a problem. From a government standpoint is that if you go out for a permanent rate and that permanent rate is only going to last you for three, four, five years or even 10 years, it's extremely difficult to get around that. You are going to have to go out for a levy, and you are going to have to do exactly what the Sheriff is doing now. Every three or four years you are going to have to go out there and not know whether you are going to have the funds to operate. Cascade Court Reporters 541-385-5664 E E C 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 18 1 And I take a little different position than Tom. I think you need to set a rate you can live with for 3 a lot of years, that you may not levy the whole amount which we didn't. We didn't levy the full amount, and even this last time when we did that money went into a reserve account so hopefully we don't have to go out for levy. So from my standpoint this is your call down here. This is not our call. You guys have to set your rate. But I would surely look at a rate that's going to last you 10, 15 or 20 years and be able to live within that. Because new growth is the only thing that increases your income. And without -- one of these days Sunriver is going to build out and you are not going to have the new growth to help offset your costs. And costs keep going up. And I think personally you need that flexibility. But that's your call down here. MR. BRANNAN: That's exactly what the board is currently wrestling with and will be in contact with your offices as well. COMMISSIONER DE WOLF: Next is Gary Fiebick. Before you start, Gary, one thing that Mike Meyers pointed out to me the governing body that would set the amount that's levied is actually the county budget committee made up of the three County Commissioners and three citizen members one of whom is Lee Smith who lives down here in Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 19 Sunriver. So thank you for that clarification. So each year if this was approved at 3.95, whatever the amount was levied has to be approved by the budget committee of Deschutes County. Gary. MR. FIEBICK: Thank you. Gary Fiebick, F -i -e -b -i -c -k, general manager for the owners association at Sunriver working on this project. Just wanted to address we will have some final numbers and proposals to the Commissioners before the final hearing next week. It's good that you ask the questions about looking at the cost, total cost, of the district and operation of Sunriver association being a little higher than they are combined today. I might just review for everybody. You remember most of what's going on today in the corporate world or even in cities and sometimes in districts is there are mergers and acquisitions, and what they are doing is consolidating the operating costs of two organizations into one, and that's where they save a lot of money. In this case what we're proposing is a vote whereby there would be splitting of one organization into two, and therefore there are some increased costs just basically because each organization has certain fixed costs they have to cover in order to operate as a separate entity. And so that is part of the difference there. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 20 Secondly another benefit for the district, for the community, would be some reduction of the tort liability particularly in terms of having these public safety operations in the district. Third we think that the benefits to employees are improved particularly with regard to disabilities and other insurance through PERS. But what we expect there then is a reduction of turnover from the two departments from what we have had in the past. COMMISSIONER DE WOLF: You are losing some of your staff to other local agencies? MR. FIEBICK: Particularly the police department becomes a great training agency. We have people that are hired by Deschutes County Sheriff, recently by Crook County Sheriff, and by other cities. We have a gentleman going to Corvallis in a couple of weeks. COMMISSIONER DE WOLF: We all appreciate the fine training that you are giving. COMMISSIONER LUKE: By the same token the Sheriff losses people to the City of Bend and other agencies too. COMMISSIONER DE WOLF: So we need you. MR. FIEBICK: We hope to slow that down. The fourth point is that we are in the process of doing a reconciliation of the changes in the total costs and that's Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 21 under development. We will be able to share that with owners and with the board next week. I would think we could get there by then. And then finally the board of directors at a work session last week does recommend that a new tax rate, maximum tax rate, be set so that the district can operate at least eight years without having to look for a special levy. And we all can do forecasts and estimates of budgets for the first year and first couple years, but beyond that unless somebody has a better forecasting ball than I do, all bets are off a little bit. So there has to be some ability to operate and have some contingency money and surplus moneys available for the unknowns that can happen a few years out. So that's all I have to state this morning. And we will respond to any questions appropriate. COMMISSIONER LUKE: Tom mentioned that there is a six -person budget committee, three County Commissioners and three citizens members. When we do Black Butte's budget, their people come and do a presentation to us as a public hearing, and you are welcome to come in and testify on that budget. And the rate that they set for that year if it's -- most of the time it's not the maximum rate. Sometimes it is. So those are all public hearings. But the board members from Black Butte also have their own public hearing in the community and talk about it with Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 22 their homeowners and those kind of things before they come to the budget committee. It's a very public process when you do set the rate each year, not the permanent rate each year. MR. FIEBICK: Right. And that's my understanding that maybe some of the people in the audience don't understand that we are working with your legal counsel to set up a district managing board who would be responsible for that. And if that's a five member board, then two of those members would be from the current or then sitting SROA board so they would go through development of the budget and present it to the budget committee. COMMISSIONER LUKE: When we met with the Black Butte board just recently, they served us a very nice dinner in their lodge. MR. FIEBICK: We were going to invite you to lunch today, but since Tom is leaving early we didn't think it would be fair. COMMISSIONER DE WOLF: Third is Shirley -- and I am sorry. I can't read the handwriting. M -i -1 -d -e -s. MS. MILDES: I am Shirley Mildes, M -i -1 -d -e -s, and I am president of the board of directors here in Sunriver. Mike and Gary have presented the facts very well and I just wanted to add a note about nonresidents. That is a big concern here in Sunriver. We only have about Cascade Court Reporters 541-385-5664 23 1 1,500 full-time residents. We are trying to set -- this is 2 going to be a managing board which is made up of -- we are 3 proposing five people, and of those five people two will be 4 SROA board members, three will be residents or owners is 5 what I want to say. They can be either resident or 6 nonresident. 7 So in that way we are hoping that the 8 nonresident will have representation through that board and 9 also by the election of the SROA board -- the SROA board 10 will be looking at the managing board and the managing 11 board will be under the Commissioners. But in those ways 12 we hope to involve the nonresidents and give them an 13 opportunity to participate. Thank you 14 COMMISSIONER DE WOLF: Thank you, Shirley. 15 Next is Jim Henshaw. 16 COMMISSIONER LUKE: While Jim is coming up, I 17 would like to point out when we did have our yearly meeting 18 with the Black Butte board they did have one nonresident 19 that was on their board. 20 MR. HENSHAW: I am Jim Henshaw, H -e -n -s -h -a -w. 21 I am a permanent 12 -year resident of Sunriver, and I have 22 been on the citizen patrol. That's the group I am speaking 23 for. The Sunriver citizen patrol is a volunteer public 24 service group and actually we have a federal tax exempt 25 status. We provide essentially backup to the police Cascade Court Reporters 541-385-5664 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 24 department. We do traffic control, we do parking control, take animals to the pound and act as the eyes and ears for the police department. We are also actively involved in the planning for any emergency evacuation. We go through drills, and we are prepared to go out and direct traffic to get you out of here if we have a fire or a problem on the railroad. We also put new maps in the boxes. Quite frankly we would hate to lose any more of our highly qualified police officers, and we wanted to take this opportunity to announce that last night at our monthly meeting we passed a resolution that reads as follows: Should the Sunriver Service District not be formed, the citizen patrol will disband. Thank you. COMMISSIONER DE WOLF: Can I ask a question because I'm not sure I understand that. If the district does not form -- MR. HENSHAW: If a district is not formed, the citizen patrol will disband. We are very uneasy about being out there without radio contact with immediate police backup. COMMISSIONER DE WOLF: So in other words, and if the district does pass -- MR. HENSHAW: We will remain just as we are. We will continue to provide the services. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 25 COMMISSIONER DE WOLF: So is that then -- I just want to be clear. That's an indication of your support for the formation? MR. HENSHAW: 100 percent support. COMMISSIONER DE WOLF: Thank you. Randy Egertson. MR. EGERTSON: My name is Randy Egertson and that's spelled E -g -e -r -t -s -o -n. I am a resident of Sunriver and immediate past present of the board of directors. And I find myself under the circumstances that we face today to be in support of forming a district, and I would like to speak just specifically to the maximum tax rate issue. I think that there are two reasons why the 3.95 which was initially set kind of like a strongman is way too high and we must lower that maximum tax rate substantially. I think the board is talking about down to 350, and I am suggesting even as low as between 330 or 335 for two reasons. Number one, we probably have 100 or 150 owners here which is about 10 percent, and unfortunately many, many people don't pay a lot of attention to these things until they have to vote. And the 3.95 is going to scare the daylights out of a lot of them and I think will be a real negative to getting the district passed. A lot of people will see that as what they are going to be taxed Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 tomorrow the first year and not really understand -- in spite of all the education we try to do, there still will be a lot of people that won't understand that. Secondly, I think Sunriver is a very stable community, we have fixed borders, we are built out to about 90 percent. Our permanent residency rate has stayed stable. Our police and fire departments are staffed and equiped now to meet all the needs that we have. Thus the opportunity for unexpected or unknown things to arise in the future that would cause the governing board to have to ask for more taxes is very, very small. And I don't think that we should go into this with a tax rate -- the maximum tax rate that would allow the board to continue to raise the levy for a long period of time without coming back to the owners and explaining why the tax levy needs to be increased dramatically. I am also currently on the finance committee, and I know the board will be coming to you with detailed information between now and next week. But I think that the projections that we are looking at now for what the levies will need to be over the next eight to 10 years don't even approach $3.30. So I would encourage you to get that maximum tax rate as low as You possibly feel is appropriate. COMMISSIONER LUKE: I would like to point out I Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 27 am not here to say 3.95 is the number. That has to be a determination by the residents down here and what you guys want to submit. But as you look at this over the next week, understand that police and fire are under mandatory -- what's the word? -- binding arbitration, and the wages that are set for them are not determined by you. They are determined by somebody from outside the area. And they will look at the City of Bend, they will look at the Sheriff's office and the City of Redmond and they will make a determination. And you don't have a some people off to stay within your budget. My only suggestion is as you take that into account if you set a rate that you are not going to have to change for maybe 10 years hopefully and you never get there, but I am not here to tell you what rate that is. That is a determination for your budget committee. MR. EGERTSON: I think that the budget planning projections try to take that into consideration. And frankly I don't have a problem with the thought that the district might have to come back to the voters in four years to ask for a levy because I think the increase -- because I think if we do, that just keeps them honest and keeps them having to provide the right justification for what they are doing and what the costs are going up. To me Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 a 10 -year span is not that big a deal. I will be more than happy to vote in four years, if necessary. COMMISSIONER DE WOLF: I want to be clear. The people who are proposing this, the tax rate that they settle on, by the time of the public hearing I am not going to set a different rate, have this fail and then it's my fault or have it pass and the other half of the people say it's my fault or our fault. When these things come before me just speaking for myself, I will either approve or disapprove based on the proposal that's brought next week. And if that's 3.95, so be it. If it's 3.30, so be it. What I am trying to explain is that from what I have been hearing, these are the kinds of questions that need to be answered. And if 3.95 is the rate, those questions get answered on election day in May. And so.I am not here saying that if 3.95 is the number that people settle on, that I am going to say we are going to go 3.30 or nothing. And I just wanted to clarify that. MR. EGERTSON: And it sounds to me like you as the Commissioners will be within reason willing to accept whatever our board comes to you with and suggest as what they want the tax rate to be. COMMISSIONER LUKE: The district is the one that has to live with it. You have to provide the Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 29 services with the rate that you choose. And we will provide as much information as possible from our county administrator and our finance people to help you get to that decision, but that decision is yours. COMMISSIONER DE WOLF: And Dennis is exactly right. We do want to be as helpful as we can be, but I think that all of three us would agree clearly that this is a local decision when these things come to an election. And the questions I am raising are questions I would raise if I lived here, and they are questions that have been raised to me by people who do live here. And if in fact you come to the conclusion that at 3.95 this is going to fail, then it wouldn't be very wise to move forward with this election. If you can find a different number that works and you feel more confident, great. If 3.95 feels right -- but those are the kind of questions that I need answered that will help voters to make a decision over the next three months, and then people on both sides will have their own sales job to do with the voters. MR. EGERTSON: Then I would say that the remarks I made generally for you I would redirect then to our current board and tell them to sharpen their pencil before they come back to you. COMMISSIONER DE WOLF: Thank you. Cascade Court Reporters 541-385-5664 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 30 MR. MEYERS: This is in regards to some comments on PERS and making some projection in the future. But some of the speakers have been commenting that they are making the projections in their budgets,that they see some stability over the long haul here on this budget. Three weeks ago the county thought that we had a two and a half million dollar surplus in our PERS account, and two weeks ago we found out we had a $6 million deficit. And next year we even projected to have a $12 million deficit. The state agencies went from a $39 million surplus to $1.1 billion deficit. And so you can't make these budget projections thinking that there is going to be some certainty in these figures. These are real expensive costs that we don't know how we are going to handle these. I don't think the state has even come to grips on how they are going to handle it. The entire PERS account is $3.3 billion in the hole right now. COMMISSIONER LUKE: For one year. MR. MEYERS: For one year. COMMISSIONER DE WOLF: I can't believe nobody is talking about this when we have got 700 million at the state legislature and PERS alone is -- MR. MEYERS: $3.3 billion. I want to get those on the record that everything isn't predictable. You can be hit by some of these things, and you should take that Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 31 into account with your rate so you can be prepared to deal with it. COMMISSIONER DE WOLF: Okay. York Richardson. MR. RICHARDSON: There has been plenty of spellings of the word York in the last few months, but it is Y -o -r -k. Richardson, R -i -c -h -a -r -d -s -o -n. Some of my questions have been answered. However, the numbers that are presented to the homeowners have every effect on the passing or failure of this issue. And I think that as we are coming up with and everybody is considering what the costs are, I want to be sure that whoever is coming up with a number is taking all of the figures into consideration including the effect of our own police department on our county taxes. We are currently enjoying a relief with respect to rural areas because we do have a police department. That, of course, is going to be maintained, that differential will be maintained if we maintain our own police department. If we rely on the county sheriff for all of our police protection, our rate will go up on our county taxes eliminating that relief that we have for having our own police department. And so that figure needs to come into consideration when people are comparing what the difference is in what they are paying now and what they will be paying Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 32 after the establishment of a public service district. Also of course -- and I think that this has been taken into consideration -- the annual assessment by ourselves through our Sunriver Owners Association board will be decreased by the amount that the board is not going to have to budget and pay from our maintenance dues. And lastly, I have great questions in my mind as to what is going to happen to our fire station which is not yet paid off. If the county decides not to have a fire station here in Sunriver, then what are we going to do with that building, number one? If they do decide to have the station as it is now, there will be some moneys, I presume, paid by the county to the Sunriver Owners Association for the utilization of that building. The same thing has to do with our police department location and the new administration building. And also consideration points of what is going to happen not only to our very capable police and fire personnel, what's going to happen to your police cars? What is going to happen to our police uniforms that we own? What is going to happen to our existing moneys which reside in our retirement fund for those personnel? All of these are factors which must be taken into consideration and all of which have great latitude in how they are handled. And until those facts are known, our Cascade Court Reporters 541-385-5664 14 15 16 17 18 19 20 21 22 23 24 25 32 after the establishment of a public service district. Also of course -- and I think that this has been taken into consideration -- the annual assessment by ourselves through our Sunriver Owners Association board will be decreased by the amount that the board is not going to have to budget and pay from our maintenance dues. And lastly, I have great questions in my mind as to what is going to happen to our fire station which is not yet paid off. If the county decides not to have a fire station here in Sunriver, then what are we going to do with that building, number one? If they do decide to have the station as it is now, there will be some moneys, I presume, paid by the county to the Sunriver Owners Association for the utilization of that building. The same thing has to do with our police department location and the new administration building. And also consideration points of what is going to happen not only to our very capable police and fire personnel, what's going to happen to your police cars? What is going to happen to our police uniforms that we own? What is going to happen to our existing moneys which reside in our retirement fund for those personnel? All of these are factors which must be taken into consideration and all of which have great latitude in how they are handled. And until those facts are known, our Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 33 board and our general manager have an additional very much more difficult program in setting up what the tax rate will be. Thank you. COMMISSIONER LUKE: I would just like to point out Deschutes County does not do fire. You have rural fire protection districts that do that outside your urban areas. You have your own fire department here. This district if formed will have the ability to do fire, ambulance and police services, but we don't do fire. MR. RICHARDSON: Well, someone does. Excuse me for -- COMMISSIONER LUKE: I just wanted to point out rural fire protection districts are the ones that have the stations just down the road. Those are taxing districts on their own. COMMISSIONER DE WOLF: And if this doesn't pass, it would remain the way it is now. It wouldn't be anything that the county would step into. The other thing is if I remember correctly, Sheriff, there's a difference of about $3.35 roughly? SHERIFF STILES: They are paying 78 right now. Unincorporated is $1.12. COMMISSIONER DE WOLF: And so that's the difference that you are looking at is $0.34 difference between -- Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 34 MR. RICHARDSON: That's true as far the tax is concerned. But we have also paid for all of the appurtenances that go with creating a police department. COMMISSIONER DE WOLF: I understand that. What I am trying to point out -- if I could finish, please. The thing I am trying to point out is you are talking about $0.34 difference and that does have an impact. But when we are talking $3.95, $0.34 isn't a huge amount there. That is taken into account in the information that I have received. The difference, though, so far on what I have seen is that the homeowners dues being lowered would not be lowered to a point where people are not paying more money. Homeowners would actually be paying, from I have seen, somewhere in the $125 a year average more than they are paying currently, and that's where my concern was raised here. You are absolutely right. All these things need to be taken into account and need to be answered, and I would assume that most of these questions will have some form of answer by next week's hearing. And beyond that if this is finalized and approved, we will go to a May ballot, and you will all be hearing the arguments on both sides for the next 90 days. MR. RICHARDSON: Yes. And one factor which also comes greatly into play is that we have a fixed rate Cascade Court Reporters 541-385-5664 1 2 3 -4 5 6 7 8 9 10 11 12 13 i appeal process 14 free 15 terms of 16 appeal 17 And we 18 to get -- 19 of 20 to 21 22 23 24 25 35 per property assessment across the board the same regardless of whether you are living in $100,000 house or $1 million house. What's going to happen when this occurs is that it's going to be taxed on the basis of the assessed valuation of the house, and that's going to make a great deal more difference than any other single factor. And as long as I brought up this factor of assessed valuation, I think that the county assessor is way off base assessing my house at what my neighbor sold his house for. I can take any of you and the assessor too into different houses and the difference in cost of construction between a minimal figure which has been expressed on TV and advertising for some homes of about 35, 38 dollars a square foot and the cost of building that same house with the most deluxe features of tiles and wall hangings and coverings and window area and tile and bathroom fixtures and all of those other factors that go in it. It can be a difference of between this 35, 38 dollar level and $150 a square foot at the minimum difference. COMMISSIONER DE WOLF: What I would point out to you is that the assessor is a separately elected official and we have virtually no authority. And you do have an appeal process that is free in terms of the appeal itself. And we tried to get -- some of us tried to get a charter passed over a year,ago in which the assessor would Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 36 be an appointed position and would report to the Board of County Commissioners. That was trounced about 75 percent to 25 percent. And so that the people living in this county apparently like this system as it exists regarding the -- COMMISSIONER LUKE: Some people are bitter. I need to ask you a question. Does the current -- does the commercial property in Sunriver pay into the homeowners dues or anything? How do they pay into -- MR. RICHARDSON: That would really be a better question addressed to Mr. Fiebick. But my understanding is that, yes, that there is a formula -- COMMISSIONER DE WOLF: We have an affirmative nod that they do. MR. RICHARDSON: -- for addressing that and they do pay more than a single property assessment naturally. And if they have a bunch of condominiums or houses that they rent out and lodging and the building you are in and so forth, there are factors that go into that, but I am not privy to the total formula. COMMISSIONER DE WOLF: Thank you. COMMISSIONER LUKE: I notice Tom is in the back of the room. Earlier we thanked Sunriver for their hospitality. You guys, this is very nice. COMMISSIONER DE WOLF: Next I believe is Harvey Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 37 Abrams. MR. ABRAMS: I am Harvey Abrams, M.D. I have lived in Sunriver for 10 years hidden behind the screens. I don't get active in anything. So standing up here is unusual for me. I am a founding partner, senior partner and managing partner of Roseburg Anesthesiologists. We have owned property in Central Oregon around Sunriver since 1976. I do not object to the district as such. I am in full support of our police and fire departments and I think they need more help. Past presidents of the board of Sunriver have spoken to me at length with regard to the problems of employee turnover, and their positions have flip-flopped back and forth between a taxing district and remaining as we are. In addition their positions flip-flop between forming a city government and remaining as we are over the years. In addition their positions have flip-flopped between buying the old school and converting it to a meeting place for permanent residents of Sunriver and abandoning that concept. So you see, as the winds of time blow, the whims and directions of the board also blow. Fortunately as I like to say in spite of and because of Sunriver's governments and the way it's put together like the Deschutes, it just keeps rolling along. I think progress is a good thing. It's unfortunate when Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 38 people want to obstruct progress. But I do not think that progress comes from arbitrary position that the voters are placed in. Future of raising the levy, because -- future possibility of raising a levy because of increased costs that can be not predicted at that time would mean holding a shotgun to the head of the voter. Either you vote for increasing your own levy or you lose your police and you lose your fire. That's a no-win situation. That's not a choice. Now, as far as the cost of the present levy, if it does not provide us with more services, it's insane. Because the present levy will raise the average taxes in Sunriver by 50 percent, and the spread of taxation in Sunriver will go from somewhere around $1,800 a year for the lowest to $15,000 for the highest appraisal of property in Sunriver. Now, right now we pay between eight and nine dollars a thousand, and for that we get schools, we get roads, we get other county maintenance services. The only thing we don't get is police and fire which according to the figures and the very few figures that have been promulgated by the board state that that essentially costs us about 50 bucks a month because that's about what this fire district and police district will save us. Now, if the median cost of taxes in Sunriver Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 39 goes to somewhere around $6,000 as a result of this levy, we have to ask what are we getting for $6,000 when the median cost right now of taxes in Sunriver is only about $3,500 plus our $800 a year annual assessment. I am not against increased taxes for better government, and I am not against the police and fire department getting the benefits of PERS. I think they need it. But I am against our voting on something that we do not have all the figures, and in spite of what the board has said, there has been a lack of communication from the board and a real rush and a push. We have not gotten the dollar data information, what kind of services we are going to get and how far in the future these costs are going to take us. Thank you. COMMISSIONER DE WOLF: I have a question for You. You tossed out a number of figures here that conflict with some of what I have heard. You said that taxes will go up 50 percent and that the highest rated person will pay an additional $15,000 a year, that the median cost -- MR. ABRAMS: No, will pay 15,000 total. COMMISSIONER DE WOLF: Including -- so not 15,000 additional, 15,000 total? MR. ABRAMS: If you can $100,000 at $4.00 a thousand, that's $400. If you take a million dollar house at $4.00 a thousand, that's $4,000. If you take the median home at 450 to $500,000 valuation in Sunriver, figure it Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 out. It's 2,500, $3,000 more. And that same median home is only paying $3,500 in taxes right now. COMMISSIONER DE WOLF: What my request of you is that by the time we meet next week, if you could provide some documentation of what you have stated here today because what I have -- MR. ABRAMS: With all due respect -- COMMISSIONER DE WOLF: May I finish, please? MR. ABRAMS: You can finish. COMMISSIONER DE WOLF: The most recent information I received is that the increase on the average value would go up a little over 20 percent. And if in fact it's 50 percent, that's information I need to know. MR. ABRAMS: Well, your own -- of course, it's not your own but the county board of assessors can give you the average valuations for Sunriver. I am not privy to walk into the county board of assessors and say spend a half hour getting me this information. COMMISSIONER DE WOLF: Actually you are, and what I want to point out to you is what I base my decision on is information in the record. I don't create the information for the record. MR. ABRAMS: I will seek out the average valuation or median valuation for Sunriver. COMMISSIONER LUKE: The total rate for Sunriver Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 41 including schools and the county levies and then the bonds for the schools and the county are $10.18 a thousand. That's the total rate right now. Which is compared to almost any place else -- of course, you have the homeowners dues. You have homeowners dues and you pay for a lot of these things outside your taxes. MR. ABRAMS: You just made my argument. Because $4.00 a thousand plus $10.00 a thousand you are at 40 percent increase right there. COMMISSIONER DE WOLF: What I want you to understand I am not disagreeing with your position. I just want to know that the position that you have is clear to me. If you can put that down on a page so that I have something to compare to, it would help me to understand your position. MR. ABRAMS: I understand. I will do my best to prepare whatever you need. But the argument is made. And once again government for government sake is not the direction we should be taking. It's for better services. And until our board can demonstrate that we are going to get $4.00 worth of extra benefit from better services -- I have one more point to make. And the police departments are not going to be happy with what I have to say here. But the police departments have done a fine job in Sunriver over the Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 42 years, and I don't know that any of them has ever withdrawn a side arm. It's possible they have. Nonetheless, I wonder do we need armed police guards in Sunriver? Certainly we need reporting personnel. But do we need police guards in Sunriver anymore than we need armed police guards in the major malls? Thank you. COMMISSIONER DE WOLF: Thank you very much. And the last name I have on here is Jens Jorgensen who testified earlier, and I am assuming that Jens either left or -- and that's the last name I have on the list. Are there any others who would like to testify? Yes, sir. COMMISSIONER LUKE: We have two hands. Anyone else? There's quite a few. MR. EDWARDS: My name is Don Edwards. I am a 13 -year permanent resident here in Sunriver. And I am not speaking on either for or against it, but I think we ought to bring the figures to mind a little more. I have been told that our monthly dues to the SROA will be reduced by about $39 a month if we go ahead with this service district. $39 a month times 12 months is $468 we don't spend. On the other hand if we spend 3.95 per thousand assessed, for a $200,000 times 35 that's $790. $790 less 468 you are paying $332 for a $200,000 assessed house. For a $300,000 assessed house you will be paying $1,185 less 468 you will be paying 717 more. And for a $400,000 house Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 43 you would be paying $1,580 less 468 for 1,112 more. My question is where does this money go? Why are we paying extra? What are we getting for our money? COMMISSIONER DE WOLF: Thank you. MR. KREISS: My name is Jim Kreiss, K -r -e -i -s -s. I formerly served on the Sunriver board of directors and was chair of the ad hoc committee that was studying the services delivered by police and fire. First I want to thank the County Commissioners for coming here. I know you enjoy the building, but we are happy that you came here so we didn't have to come into town again to meet with you. We appreciate that. And second I want to thank Sheriff Stiles for being here today and for being clear about the kind of services not only that we have in Sunriver but that we could expect under a contract with the Sheriff. He's been very up front about that. And he wants to also make us understand what happens to our police department if we don't have local control under our board of directors with an assistant board working with the County Commissioners in the formation of this service district. I think after studying this thing since 1998 with the public safety committee, coming to the board, going through the processes, looking at the possible inclusion of the fire department with the La Pine district, Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 44 looking at what we want to do with our police department, it's imperative that at this time that we form the district regardless of the impact that it's going to have on some of US. I am a homeowner. I have a house that's worth more than the average amount. I expect to pay about $300 more per year, maybe 400, for the formation of the services district. If I want to keep my police department under my local control giving me the services in Sunriver that I expect, then I think that somewhere down the line I am going to have to pay more money.' That means the guy next door who has the empty lot is going to pay less for once. Sunriver's taxing policy has been out of whack. We know that. The million dollar house pays the same amount as the empty lot. Somewhere along the line if we are going to keep the services and provide the kind of effect that we need to have, we are going to have to balance that out. I think we need the service district now. Thank you very much. COMMISSIONER DE WOLF: Thank you. What was your name again? MR. KREISS: Jim Kreiss. COMMISSIONER DE WOLF: Yes, sir. MR. GHORMLEY: Good morning. My name is Dave Ghormley, G -h -o -r -m -l -e -y. I am not here to say yes or no. Cascade Court Reporters 541-385-5664 i 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 45 I personally don't know exactly where I want to come down on this vote, and we have got 90 days to make that decision once we set the tax rate. I am interested in seeina that all the facts that we need to make an intelligent vote are spread out in front of us, and my own feeling is that there is some that aren't yet dealt with properly. And incidentally I don't mind -- if we settle on a tax rate, I don't mind going back to the voters down here for more. We do this all the time. And this is a good responsive intelligent community and it isn't something that takes a lot of hoopla. We just need the facts and we will go ahead and vote. If the need is justified, we will vote for it. And if the need isn't justified, we won't vote for it. So I don't think the issue of going back for a levy four years from now, five years, six years is really pertinent because this community will turn out and give you a fast answer if you need more money, and I think everybody who has served on the board would understand that. I want to talk about two issues. One is equity and the other is the costs that are being presented. There's a difference of opinion that could amount to about in very rough figures up to around $0.30 on the tax rate of whether we should give certain assets and certain services to the new district or whether we should charge -- Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 COMMISSIONER DE WOLF: We meaning the owners association? W. MR. GHORMLEY: SROA. Right. For instance, the fire house. I think I am right, Gary. I think we got 200,000 bucks left still to pay on the fire house. Is that about right? $300,000 Pete is saying. That's three more payments and then we own it or something like that. Maybe four more payments. Why are we going to charge the new district rent and buy it back all over again? It sounds to me like what we are doing is we are shifting the cost of the fire house to those who have more expensive properties. So we are going to go out here now and pay a million dollars over a period of time in rent to buy something that the community already owns. And this isn't the district versus SROA. This is us because the district is us and SROA is us. COMMISSIONER DE WOLF: Is it the same boundaries? MR. GHORMLEY: Same boundaries. Exactly. So why are we shifting a million dollars worth of cost in the form of a rent from the district to the homeowners association? And secondly, the same thing with the fire trucks and the police cars and the uniforms and all this other stuff that York was talking about. Why are we Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 47 selling that to the district? What are we going to do with this cash? Why do we need it? Same thing with the administrative services we are proposing to provide. We have one general manager, we have one accounting department, and now we are proposing to sell part of that to the district. If it will help bring the tax rate down, to me it would be greater equality by donating those services to the district. What happens if we do? If we donate those services, if we donate the facilities, if we donate the reserve funds, if we donate nature the equipment, then what have you done? You have reduced tax rate and increased slightly the homeowners' rate. Now think about equality. Isn't that a fairer deal? Does the guy who has a $100,000 house or a pole house over here with a $50,000 house, does he have any less need of fire and police than somebody in an $800,000 house? I don't think so. Does the fellow who lives in Corvallis or Salem who wants to be sure that somebody doesn't come in and break into his house, does he have any less need of police protection than the person who is living here all the time? I don't think he does. So I think if you want to talk your way through this, I think what the board has not done yet is said what is fair, and I see no reason to shift these costs to those Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 people and those facilities that have higher values. I am going to bring the resort into this too even though they haven't asked me to do this. The resort is going to take a big time hit on this deal. If there is one thing I want to have around this community is a healthy resort. I want to be sure it's profitable and first class. And here we're talking about something that will load them up with a bunch of costs which is in violation of what we originally agreed to do in our consolidated plan. COMMISSIONER DE WOLF: Can you explain why that is. MR. GHORMLEY: Because there's a sweetheart deal that the resort wrote when it turned all these assets over to the homeowners association. They get a preferential break on homeowner fees. COMMISSIONER DE WOLF: So then they would be responsible for -- MR. GHORMLEY: Now all of a sudden they are going to get taxed on the basis of their assessed valuation and they are going to take a load. And before we go loading them up with this, I think we better think about the impact on the homeowners' values. The other point I want to talk about is cost. To me the figures that are being presented are hopeful costs. I think Marty brought it out exactly right over Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 M •, here, and that is if you take this same budget and say let's pretend we're in Bend, what would these costs look like, I think you are going to get a far different picture of what it's going to cost to pay for the labor to perform these functions. And when you hear horror stories on PERS like we just heard, I get very, very nervous. Now, the homeowners association and all the people on the public safety committee and you heard a little bit about the pressure they are putting on down here for the citizens patrol now threatening to go out of business if this doesn't pass, this is the kind of hoopla that we are getting. But on the other hand what we are really talking about is what I need as an old fogey is I need a good ambulance service. And the biggest risk we got around here is fire, and I need'a fire protection service and all we are focusing on is the police. And frankly I haven't seen too many murders down here in the last 15 years. So Sheriff Stiles has a legitimate point I.think in saying I want to have control over people that are commissioned by me. I don't have any problem with that speech. As to the details of how that works, I'm not so sure. But I do know that when we start talking about having two full-time policemen patrolling the streets down here 24 hours a day, then if we want that kind of service, Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 50 we are going to pay for it. And if that's what we decide to do is go ahead and pay for it, then I am perfectly satisfied with that. But I think we better start thinking just a little bit about do we in fact need that level of police protection? And let's concentrate instead on how we are going to be sure that we have good fire protection and how are we going to be sure we have got good ambulance services. I think these are issues that the board in it's effort to try to get this problem off the agenda and get on with something else has not spent enough time clearly telling us exactly what the reality is, and as a result there's a lot of rumors going around saying there's no way this thing is going to fly for $3.00 or there is no way it's going to fly for 3.30. And we are saying as somebody previously said what do we get for our extra money? In my case it's probably $150 a month. And what do I get for the $150 a month? I am not saying I am not going to vote for it. I would love to have this issue go away. But I'm not going to vote for it unless I am convinced that I am going to get value received. Thank you. the red. COMMISSIONER DE WOLF: Anyone else? Back in MR. MARTIN: I am Peter Martin, M -a -r -t -i -n. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 51 I am a nonresident owner 14 years, and I want you to know that I support the formation of the district. I think there have been a number of questions that have been raised at the 11th hour. It's too bad they didn't come in earlier. I think the board has made every effort they can to inform us all as clearly and through as many meetings and they could come up with to let us know what's going on. I want to see this happen. We have only two choices here. We have the Sheriff's services which will be less than what we have now, and we have what we enjoy today. I want two officers patrolling 24 hours a day. It's not so bad this time of the year, but what about July and August? We need them. There is a lot of vandalism that can go on here without police presence. We take it away, the word gets out, the burglars come in. We have got a wonderful police department and a wonderful fire department, and I think the reason we're looking at the formation of a district and talking about 3.95 a thousand is because we haven't paid the people enough to start with. We have been getting the free ride on our public services. So it's time to pay the piper and bring our folks up to par with the industry. I can't vote so all I can do is encourage you to review this and please look upon this favorably because we need to have the level of services that have been provided. Thank you. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 52 COMMISSIONER DE WOLF: Thank you. Next. MR. QUINN: Tom Quinn, Q -u -i -n -n. I just want to raise a question. Mike Meyers raised the issue of the PERS cost and that sudden increase in liability. I wanted to ask is that not mostly or maybe all due to your exposure to Tier 1 PERS? MR. MEYERS: It's part of that and it's also part of the stock market. MR. QUINN: Isn't that to Tier 1 PERS -- MR. MEYERS: It guarantees an eight percent. MR. QUINN: I think everybody here doesn't understand PERS has Tier 1 and Tier 2, and employees that were in the program prior to what year? MR. MEYERS: 195. MR. QUINN: The main point is Tier 1 PERS does have major financial problems. Everybody has read about those in the paper, and this is what I believe you are talking about. And I believe almost all if not all of your current liability surprise isn't due to Tier 1. MR. MEYERS: We have -- 60 percent of our people are Tier 1 which is one of the lower percentages. MR. QUINN: But our employees if we form a district are only eligible for the Tier 2 program which does not include -- MR. MEYERS: They would be in the state pool, Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 53 and so I don't know how you can predict what the state pool rate will be when this district is formed. MR. QUINN: But the state pool again will not include in Tier 1 or any of the Tier 1 liabilities. MR. MEYERS: It does now. COMMISSIONER LUKE: State pool is all Tier 1 and Tier 2. MR. QUINN: Is that correct? COMMISSIONER LUKE: Yes. MR. QUINN: That's what I wanted to clarify because I really don't understand. MR. MEYERS: The county is part of the state pool effective January 1 of this year. These liabilities we are having now are not -- these are past liabilities. I can't tell you what the future ones will be, and I can't tell you what the pool rate will be next year or the year after. The point I was trying to make is you cannot predict some of these costs on a long term basis. MR. QUINN: I understand and I agree with that. But I mean I am trying to clarify that Tier 1 and Tier 2 -- frankly it's very confusing to everyone and I am sure even to you who works with it. MR. MEYERS: I think solving this problem you are probably going to end up with Tier 3 and Tier 4. COMMISSIONER LUKE: If the legislature ever Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 acts. MR. QUINN: They didn't the last time. Thank you. 54 COMMISSIONER DE WOLF: Mike is going to take over as Vice Chair of the Commission. I need to run and sorry that I have to leave. Thanks of all your input. And I will read the rest of it when we get the printed copy and we will see you next week. COMMISSIONER LUKE: Those of you who want to testify, why don't you come up here in the front so we know how many we got. MS. BENNINGTON: I am Penny Bennington. I just happen to be the treasurer of the -- Penny Bennington, B -e -n -n -i -n -g -t -o -n. I do happen to be the treasurer of the owners association board right now, and I do know the numbers. But I do want to talk as a homeowner. I own three homes in Sunriver and I think the important point you keep saying -- Dave Ghormley asked what am I getting for my money. I calculated -- based on $3.25 I calculated that I would be paying $27 more a month for all three houses. And one of the things we -- COMMISSIONER DE WOLF: Is that each month accumulative? MS. BENNINGTON: Accumulative. And one needs to remember I think right now I just quickly calculated Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12. 13 14 15 16 17 18 19 20 21 22 23 24 25 55 where we're projected I think the mean level is about 156,000 assessed value. We will have that for you next week. But again I own -- two of those properties are taxes assessed less than that mean. So I am.going to be paying less. There are a whole number of homeowners that will be paying less for these services. We just need to remember that unfortunately what Dave -- what you will be getting for your money is to be able to keep the services that we currently have. There is a tax shift, there is a cost shift, that's what the reality is with tax assessed over the owners association which is an even across the board. And unfortunately we are not going to be able to justify what that higher cost is. But again as a homeowner with three houses, two of them are below the mean, and there is a whole number of homeowners that haven't stepped up to the plate, condominium owners, the vacant lots and everything else that will be paying less for those services. Thank you. COMMISSIONER DALY: Thank you. Anyone else? MR. FOSTER: I have a very quick question. COMMISSIONER DALY: Come on up and state your name, please. MR. FOSTER: My name is Bob Foster, F -o -s -t -e -r. I am not a homeowner in Sunriver. I have been here many, many years. I have a business and operate in Sunriver. Cascade Court Reporters 541-385-5664 1 L 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 56 Certainly trying to pay attention to this there is a lot of mathematics that I certainly can't follow. There seems to be various groups, various positions, that I'm not real certain how it all plays together. My only purpose in trying to find out is I do deal with a large number of homeowners in Sunriver that ask my opinion from time to time. My only question is this: If this were to be voted on and it's done, I believe Mr. Abrams stated very soundly that things change a lot in Sunriver. Things will continue to change. I personally believe that over years the government if you would of Sunriver is going to change from one group of people to a decidedly different group of people. If this were to come to pass and that group of people decided that perhaps the level of services was not what they thought they needed anymore or they thought they needed more, they thought the taxing was improper, inappropriate or whatever, if this thing -- if we wanted it to go away, how would that come to be done? COMMISSIONER LUKE: You don't have to levy any taxes, and Laurie or Rick can answer this, I think. But if you do not levy taxes for three or four years, something like that, three years, if you do not levy taxes for three years the county could shut the district down. MR. FOSTER: And that would be a County Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 57 Commission decision? COMMISSIONER LUKE: The question is is that a County Commissioner decision? Rich Isham, Chief Counsel for Deschutes County. MR. ISHAM: Rick Isham, County Legal Counsel. There are two ways that the district can be dissolved. One is.through failure over a three-year period to levy a tax and that's a board initiated dissolution. That's the Board of County Commissioners. The other is a decision by the district board which because it's a county service district, there is also the Board of County Commissioners. They can initiate this dissolution. Dissolution in either case takes into consideration any outstanding obligations, basically acts as a trustee and winds down the affairs of the district. COMMISSIONER LUKE: And the service district could choose to levy, say, a dollar a thousand and contract with somebody too. There's all kinds of options. Nobody says because you formed a district you have to provide all the services for that matter. MR. ISHAM: Well, that's correct on an annual basis. The decision on what services to provide and what tax rate to impose would be determined through the budget committee as was pointed out and then ultimately by the district governing bodies. And then the proposed operating Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 model is the same model that is being used in Black Butte Ranch which there's basically an operating board that operates on site, makes the day-to-day decisions regarding the operation of the district. COMMISSIONER LUKE: Does that answer your question? MR. FOSTER: If I could just so that I can clarify it. So what we are saying is we would form a district by a vote of a group of people that is currently in place in Sunriver due to their permanent residency. We would create an entity then that is of some financial benefit to the county I must assume for administrative whatever -- COMMISSIONER LUKE: No. MR. FOSTER: None whatsoever? COMMISSIONER LUKE: No. MR. FOSTER: No money flows to the county in any way? COMMISSIONER LUKE: No. MR. FOSTER: We definitely would create a situation from what I am gathering where money would be able to go up in two directions on the people that are impacted by this, one through SROA fees which can continue to go up if need be, one by increasing the tax rate that we have been speaking of. It can go up. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 59 COMMISSIONER LUKE: It can't go past the maximum tax rate, though. MR. FOSTER: I understand. Unless we go back to the voters and the voters voted against it. So what I am gathering is voters can vote to have it and to increase it, but the voters would not be the people that would be allowed to vote to eliminate it? COMMISSIONER LUKE: If I was a County Commissioner, I would probably put it to a vote to see if they wanted to dissolve it. Rick just told you a lot of times what he was talking about sometimes you get road districts that don't levy taxes and they just choose not to maintain the roads anymore. And so you have something in place so that you shut these down so they can do something else if they want to. But I have never seen it done -- it hasn't been since I have been a Commissioner. How long have you been here? 20 years? Rick, have you ever seen one shut down? COMMISSIONER DALY: Inn of the Seventh Mountain. MR. ISHAM: Actually Mike is correct. The county service district provided the sewer services for the Inn of the Seventh Mountain and condominium units and the hotel functions that were performed there. Ultimately for a number of reasons, some of them environmental, the contract was negotiated to hook to the City of Bend. And Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 so the purpose of the district -- the district was no longer needed and so the Board of County Commissioners as that was a county service district also initiated the dissolution, paid off the debts and liabilities, and developed a closure plan for the sewer plan and closed it. So it does happen. But I think in a situation like that, you had a substitute service provider which was the City of Bend which it extended the services to the district and then entered into an independent contract to provide service to the owners. MR. FOSTER: Thank you. COMMISSIONER LUKE: Thank you. Anybody else besides Gary? MR. LUERSEN: I am Tom Luersen, L -u -e -r -s -e -n. I am an ex -property owner. I was kicked out by my neighbors last week so I am no longer living in Sunriver. However, I do represent Sunriver Limited Partnership and that's the largest property owner within Sunriver. I have been asked several times over the last four or five months my position which really represents not my position but our company's position on the service district. And I have surprisingly stayed below the radar which is where I wanted to go on this particular issue. It's complicated, the math is a little bit confusing at times because we have not landed on a specific yet. Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 61 I think the board has done a wonderful job in attempting to communicate and to make information available. But like anything else, you only get those that are interested to hear the information. And as you know, we're at the lowest occupancy if you will right now, the last three or four months, than we are in the entire season. People are beginning to come into town as the skiing picked up, they will begin to arrive more often as spring comes into fruition. As those people come in, so do the questions get re -raised all over again. And to me the .most fundamental question that I don't understand and yet have heard a whole lot of answers to is, Sheriff Stiles, if you would, your position and how we got here. I have heard, met with Gary and representatives of the board. I have not missed a public hearing meeting where I usually sat in the back and taken notes. If it would be appropriate, I would love to ask Les to come up forward and just summarize -- I am not looking for a debate, I'm not looking for Q and A even from the Sheriff, but for a simple position on how we got here if it's appropriate. Lastly the resort will take a position on it. As Dave pointed out, whatever happens here to property owners here, it effects us. We are running a business. We are for profit obviously. There is a -- at the 3.95 tax Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 G. rate, it's a six digit figure that impacts our company on the gross side. That's without the reduction of monthly dues. So at the 3.95 level it's up over $110,000. It's a pretty substantial hit for us. Yet we are also a pretty large company. I don't want to sound political in my comments, but this is really a homeowner's position. It's why we have stayed below the radar. We clearly will take a position, and I will let that position be known when it's appropriate. My role in all of this and we have John Fettig, Dale Garnick, some of the people from our company, here to learn. I know that you are doing the same and that you haven't taken a position yet that's not well-informed and well-educated. That's what these forums are for. This isn't to come and listen to ourselves talk or get it in the record or to stand in front of the County Commissioners. It's an opportunity to learn. I can speak for myself only. I am not very well-educated. I'm not educated to the point that I am comfortable in making decisions. I ultimately will be. Sheriff, if you would take the time to summarize or, Commissioners, if it's appropriate, but it would certainly be helpful to me. Thank you. SHERIFF STILES: I want to thank you very much. I was kind of hoping to stay below the radar screen Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 63 also. Tom, I can answer part of your question, and for those who are here today, I will be happy to go into as much detail as you would like either now or after the meeting. I don't know how we got here. I know that a year ago approximately in March of 2001 about two or three months after I was sworn in as Sheriff I was contacted by some people in Sunriver who asked me the following question. It appears as though there's going to be an advisory vote relating to the formation of a public safety service district, and what we have been told -- we meaning residents that were asking the question -- have been told is this: There are two options. Form a public safety district or everything remains as it is. Is that true? My response to more than one person was no. That may not be true. There are a number of other issues out there that need to be explored. I have been in office 90 days. I need to explore those issues, but I would not guarantee that the options for voters to go on was a public safety district or everything remains as it is. Some change may be coming down the road. I think, Tom, that that's a partial answer to your question of how did we get here. In the intervening nine months from that time to now, there have been a number of other questions Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 C:A! relating to the issue of why does the Sheriff stand where he does. And Dave, I really appreciated your comment about what is fair because on my desk I have got a little plaque that has what's fair and what's right. Those are the two guiding principles that I try to live by daily in making decisions as Sheriff of Deschutes County for all of the people of Deschutes County. In the course of looking into what the options were for us with respect to Sunriver and the public safety district -- I am going to get back to this fair and right here in a minute. But I think it's important to understand, Dave, do you remember the exact date -- I was a candidate. There was a forum of public safety people at your house. At that time I was asked the question if you are elected Sheriff, where would you stand on a public safety district or what do you think is in the best interest for Sunriver police officers because we have a high turnover rate. As a candidate I made it clear that I thought the formation of a public safety district would solve a whole host of those problems and address them in a much better manner. The last time I was in this beautiful room I was sitting next to Larry Kimmel. Mike, you were here. It was a candidate debate for the campaign, and some of you who are here today I recognize were here then. Even though Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 65 I was running a fever and Larry Kimmel was also that night, I think I remained pretty consistent in why the public safety district would answer your needs better. In the end the question that I have to ask myself is this: What's fair and what's right for all of the people that I represent in Deschutes County which roughly numbers 118,000 right now. And the issue is the civil liability by commissioning others. Dave Ghormley hit on it, a couple of other people have hit on it this morning. Every time somebody raises their hand and I swear them in as a deputy sheriff, I as the Sheriff am representing all of you because you are my boss and I become liable for the actions of that individual. In the end that's what this issue really boils down to. But there is another very critical, critical issue in my opinion because it's not just about civil liability. I wrote an article, an In My View piece, for The Bulletin that was published last Sunday. I would urge if you haven't read it take a look at it because it's more succinct than I have been so far. But there is another issue. You need to have local control. You need to have the local control over your law enforcement and your fire services. There is going to be inherent conflict between the Sheriff and the Sheriff's office providing the Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 66 necessary and needed oversight that must be done to protect all of the residents of Deschutes County from potential civil liability and what you via the Sunriver Owners Association and management may want to see your police officers doing. And I am here to tell you right now that you can't put your police chief in that kind of a vice. There will be inevitable conflict, some of them small, some of them potentially small in.the beginning but by the time they are magnified through misconception and misunderstanding they might become large. But you can't do that. And this option is one way to resolve that issue as well as me maintaining the stance that I have had for over two years which is the Sunriver police department should be it's own entity and should answer to you. Not to me. Tom, does that answer your question? MR. LUERSEN: Yes, sir. My question is about the insurability of the liability imposed on you, Sheriff, if in fact we are a deputizing people and our officers here. We have as an owners association insurance to cover some of that is my understanding. Can we -- is there the other alternative that says you are willing to protect the liability of the residents of Deschutes County if in fact we can increase our insurance if you will for that service? That's a question I have yet to really understand the Cascade Court Reporters 541-385-5664 ,1 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 67 answer to. SHERIFF STILES: I will be happy to address that. Gary, am I correct two million right now per incident, 10 million cap? MR. FIEBICK: I think it's one to ten -- SHERIFF STILES: It's one to 10. One million per incident, 10 is the cap. 10 is the aggregate cap. MR. FIEBICK: That's the umbrella. SHERIFF STILES: Tom, to answer your question, one million isn't enough. I can't go into it, but I think Gary would be happy to share some information with you. I know of at least one incident in the last 12 months that one million wouldn't even start to go there. How high is enough? And would that also provide the due diligence that comes from the Sheriff because it's not just a matter of simply dollars and cents. The real issues that are being tested right now in the federal court system if you move outside of the state system where you have got your tort liability or at least we do and you move in to the federal venue, you have now moved into an area where concepts of negligent retention, negligent training, negligent supervision, negligent hiring, all of those negligence issues are pretty big dollar issues. And I think our legal counsel will Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 68 support that. I don't know if that's enough. But even if you had one hundred million, the incident itself that occurs I still must be able to show that I have provided all of that oversight for hiring, training, supervising. And the minute I am doing that which I am doing right now. Quite frankly in the last six months I have given Chief Kennedy a number of very specific directives, I have sent my under sheriff down, I have sent my patrol captain, my detective captain and my training sergeant to evaluate your files. I have every bit of confidence in Sunriver officers. I cannot continue on the backs of all the other taxpayers in Deschutes County to support that kind of oversight because they didn't pay for that quite frankly. They didn't. And so every time I am sending staff down to do that to make sure that we are providing that kind of oversight, it's costing other taxpayers their money. Does this answer your question? MR. LUERSEN: I understand. COMMISSIONER DALY: Anyone else want to ask a question of the Sheriff? SHERIFF STILES: Before I leave can I make one comment, Commissioner? COMMISSIONER DALY: Yes. SHERIFF STILES: The last comment I want to Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 I make is this: In the last nine months I have heard a number of allegations relating to what I have said or haven't said. Could I please make this invitation. If you have any questions, Tom, or anyone else regarding where I stand or why I stand there, please call me at my office. I will leave some business cards here today. And the other one of the areas that I am most concerned about is the fact that the Sheriff is not and will not contract. That's not true. There are a host of other options. This is not the only option. That said, this is the best option. This being the public safety district is absolutely clearly the best option for your control. And if that is important, I would certainly take that into account. I will not get involved and I cannot make recommendations as to staffing levels or any of those things. The level of service you want is your decision. But there are other options that are open and I have not shut any doors. Thank you. COMMISSIONER LUKE: What phone number do they call? SHERIFF STILES: 383-4393. COMMISSIONER LUKE: Thank you. COMMISSIONER DALY: Does anybody else want to ask a question of the Sheriff or come up and testify? Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 70 COMMISSIONER LUKE: Gary wanted to finish off if there is no one else. MR. FIEBICK: Gary Fiebick, general manager of Sunriver. Just on behalf of the board I would like just to respond to some of the comments and questions that have come up during this time. Some of the facts. First of all I think the Sunriver tax rate is above $10 per thousand currently. Secondly, the numbers and things that we are working on have nothing to do with Arthur Anderson or Enron or any other subsidiary. But actually as far as the police service level, Sheriff Stiles is correct and Dave Ghormley who was president when I came on as general manager in 1996. The policy has been since before 1996 that Sunriver would endeavor to have two police patrol officers on duty 24 hours seven days a week. Now, one of the things that we don't do if somebody is at court or ill or on vacation, we don't always back fill. But you can always be assured that we will have at least one person on when required when it's necessary. Secondly, the board had a work session and they revised some of their thoughts on the few issues so I would like to share that with you now. As regards personal property, that is the furniture, fixtures, equipment including vehicles, et cetera, the board is proposing that Cascade Court Reporters 541-385-5664 1, S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 71 all of that equipment and furniture and fixtures be sold to the district for one dollar. Essentially giving it. Therefore that will reduce the district's budget and we have a new iteration with that in consideration. Secondly, real property. That's been discussed off and on by the board for some time and debated. At last meeting it was decided that at least for now we would leave the rents there for a couple reasons. We had debt service both on the fire department and we have debt service both as well as on the administrative area. But I think underlying all of that they want to be careful that if in the future this district might merge or annex property or area to it, that the owners of Sunriver would be able to obtain a fair value for that property if it were transferred to a larger district. Next I would like to turn to tax values. We receive from the assessor specific values regarding Sunriver itself, the area that will be within this district. According to the true cash value, that means your local realtor when he comes to look at your property he is going to tell you what the value of your property is based on all kinds of comparable sales, but true cash values for all of Sunriver is $1,232,108.802 according to the county assessor. A portion of that is resort, a portion is golf, a portion is commercial, and the major Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 11 if 1� 21 2: 2. 2 2 2 72 share is residential. Now, if you look at what we're dealing with in this calculation set of numbers, we're talking about the tax assessed values. Was it 195 when the law changed that said the tax assessed values of properties in the state could only go up a maximum three percent a year unless you made an addition or something like that. The tax assessed value for the same area is $853,977,211. If you do the math, the tax assessed value on average is only 69 percent of the true cash value of the properties here. So all the calculations that we work with in trying to estimate what it would cost you as an owner whether it's commercial, resort, golf or residential is based on the tax assessed values, not the true cash value. COMMISSIONER LUKE: That number is pretty consistent across the county. Most property is 30 percent under true cash value. MR. FIEBICK: Thank you. Next item there is discussion or question about resort and commercial assessments. Yes, the resort and commercial properties and L golf properties are assessed on a formula that is set out in the consolidated plan for Sunriver, and that assessment 3 can be calculated by anyone really if you have the right 4 set of numbers. 5 For the purposes of taxes, the resort value is Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 73 $13,589,660. Now, that includes more than just what the Sunriver resort has in terms of assets. That includes the hangars because they are developed on what was resort property, and it includes the trout house because it was on resort property when it was developed. So it it's just the SLRP property, There's a couple of differences there. The golf courses are assessed separately, and by agreement with the assessor I think all the golf courses in Central Oregon are assessed more on a business basis rather than a value of land basis. Commercial properties and that's the accumulation of all the commercial properties, that's the mall, it's mall two, it's Dr. Skotte, it's the old service station, it's the marketplace store out north and it's probably a couple of other properties. Those commercial properties are $15,347,701. And the balance is the residential. Now, as concerns the resort, SLRP -- John or Tom you can correct me -- the resort owns I believe 65 lodge condominiums and 30, 35 river lodges. So that's about 100 residential units that they own. The resort will pay on those residential units just like any other condominium owner or homeowner in Sunriver. So they have those changes. In addition they have this resort value to the remainer of their assets as well as the commercial Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 74 value. And so they pay on that on an adjusted basis also. Now, the last iteration of budgets that we did we assumed that the first year tax rate might be $3.15 per thousand and that the SROA assessment would be revised downward to I believe $35. It may go a little lower. But that's what the board is comfortable with at this point in number. Based on that, the increase in combined annual tax on assessments for the commercial properties is about $33,500 increase annually. The resort properties in aggregate, the total increase with the new tax district and revised SROA assessments based on their formulas for those, their increase for all those resort properties would be approximately $23,600 a year. Residential properties. I did some calculations. There are 4,124 residential properties. Some are vacant lots, some are condominiums and some are homes. The mean value, that is the average based on tax assessed values is $198,814. That's pretty straightforward math. The true cash values based on true cash assessment, the average or mean value is $289,107. So it's almost $100,000 more true cash value on average for the average property. We looked at what the break even value might be on tax assessed values, and with a $3.15 per thousand assessment for the first year and assumption that the SROA Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 75 assessment would drop from $71.91 a month to $35 a month, then the break even value where if you have a higher value you will pay more in total or lower value you will pay less than total is about $140,600. Now, if you take the example with the mean value of property, that is the average property on tax assessed values that is $198,814, the new assessment, the new district tax, the combined increase for that property would be about $183 a year or monthly increase of about $15.25. Now, again there are a couple other choices and decisions that the board is reviewing with counsel of the financial advisors from the county and others and so these can change and will change a lit bit before we get to the final hearing a week from today. Hopefully we will have those decisions by the board and be able to incorporate those recommendations by next Monday so we can get the information to the Commissioners' office and make it available to owners. COMMISSIONER LUKE: Are you done? MR. FIEBICK: Yes. COMMISSIONER LUKE: The county and a lot of different governments and I imagine individuals, there's -- you can put a right of reversion into a deed. If the homeowners so chose to make the fire hall or different things available or give them to the district, you could Cascade Court Reporters 541-385-5664 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 I have a right of reversion there. If something changes, they would get it back. So there are some options that would protect the homeowners association. MR. FIEBICK: Right. And we have discussed that in our group. COMMISSIONER LUKE: Thank you. COMMISSIONER DALY: Are there any questions? COMMISSIONER LUKE: Do we know where we are meeting a week from today? We are meeting in this same room a week from today at 10:00. COMMISSIONER DALY: If there are no other questions, I guess we are adjourned. Thank you. (Time noted 12:05 P.M.) Cascade Court Reporters 541-385-5664 76 -L , 1; 4 ti ly, f .- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 STATE OF OREGON ) ss COUNTY OF DESCHUTES ) I, DEBORAH FLEISCHER, Court Reporter and Notary Public, do hereby certify; That the foregoing transcript is a true record of the proceedings. I hereby certify that I am not interested in the event of the action. IN WITNESS WHEREOF, I have subscribed my name this 11th day of February, 2002. DEBORAH FLEISCHER Court Reporter & Notary Public Cascade Court Reporters 541-385-5664 77