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2006-372-Minutes for Meeting August 15,2005 Recorded 3/29/2006COUNTY NANCYUBLANKENSHIP,FCOUNTY CLERKOS COMMISSIONERS' JOURNAL 03129/2006 09:05:26 AM II IIIII~IIIIIIIIIIIIIIIIIIII 2IIB-372 DESCHUTES COUNTY CLERK CERTIFICATE PAGE . NZ'F S r, c C. This page must be included if document is re-recorded. Do Not remove from original document. Deschutes County Board of Commissioners 1300 NW Wall St., Bend, OR 97701-1960 (541) 388-6570 - Fax (541) 385-3202 - www.deschutes.oriz MINUTES OF SHERIFF'S OFFICE PERMANENT FUNDING RATE SETTING MEETING DESCHUTES COUNTY BOARD OF COMMISSIONERS MONDAY, AUGUST 15, 2005 Commissioners' Conference Room - Administration Building - 1300 NW Wall St.., Bend Present were Commissioner's Tom De Wolf, Michael M. Daly and Dennis R. Luke. Also present were Michael A. Maier, County Administrator; Anna Johnson and David Givans, Commissioner's Office; Marty Wynne, Finance; and James Ross and Sheriff Les Stiles of the Sheriff's Office. Also in attendance were Lee Smith, Budget Committee member; Mike Lovely, Jack Blum and Andrea Blum, citizens. Representatives of the media present were Cindy Powers with the Bend Bulletin; and Molly Graham and Haurie Arehelian with Z21. Commissioner De Wolf began the meeting at 4:30 p.m. No formal agenda was available. The purpose of the meeting was to discuss and possibly take action on a rate to permanently fund the Sheriff's Office. Sheriff Stiles: Four and a half years ago, we started on the process of trying to obtain stable funding for the Sheriff's Office. Just as a quick review, Commissioner Luke and I went over to the `01' Legislative Session and spoke with them. It resulted in Ballot Measure 18 being crafted and the Legislature, all of the State, voted on that. Basically, the reason we were in that vote to begin with is when Measure 50 passed, the Deschutes County Sheriff's Office operating levy expired at midnight. According to Senator Westland we were only one in seven taxing district entities in the State of Oregon that got shut out in the cold. Since it did not become permanent we got stuck on a three year levy and a three year levy, since then. What we were trying to do because of Measure 50 was to set up a single district with the capability of taxing at two different rates based on differing levels of Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 1 of 12 service. That most closely mimics the split operating concept that people of Deschutes County are used to. It went down by 300,000 votes in November of `02'. In December of `02' we completed our first process of strategic planning based on that. We started to put together projected costs for two types of districts. One of which would be County wide and incorporate all common services and the second tax district to be rural, excluding Bend, Redmond, Sisters, Sunriver and Black Butte for primary police protection issues. At that point a suggestion was made to form a Permanent Funding Advisory Committee. Thirteen very bright and talented people came together, chaired by Lee Smith. They spent seven months meeting twice a month and sometimes a little more, putting together and researching the issues surrounding stable funding for the Sheriff's Office. The bottom line is very simple. I lost two employee's last week to the City of Bend, one of which I did not want to loose. I lost three last year to the City of Bend just before the levy. So far I have lost about ten people over the issues of stable funding. At $100,000 dollars a pop, that is a million bucks in the last four years. That is an inefficient way to do business. Commissioner Daly: A hundred thousand dollars is the training cost, right? Stiles: Training, uniforms, salary, roll ups, the initial investment for the first year. It is not salary, it is everything. Bottom line is that it is very simple, not only do we have that inefficiency but most of the issues I deal with on a daily basis, such as multi-year contracts (Phase II and Phase III of the radios.) Every time a multi-year contract or issue is addressed it carries with it a consequence of sustaining it, regardless of what happens with our budget. So, if we do fail a levy, the layoff's become even more dramatic to sustain those issues. This is an issue that has been bubbling along for a very long time. Lee and his group came up with a recommendation, the funding rate and setting a meeting for presentation today, the need has been clearly demonstrated. Jim Ross: I have two things here. I have a five page handout that I will go over rather quickly (see attached marked as Exhibit A) and I have a letter from the Committee to the Commissioners (see attached marked as Exhibit B.) As you know the Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 2 of 12 Sheriff's Office Funding Advisory Committee was formed one year ago with the following three fold Mission Statement: 1. Evaluate the present funding mechanisms for the Deschutes County Sheriff's Office. 2. Based on the evaluation, determine a funding mechanism that would best serve the needs of the residents of Deschutes County and assure continued public safety services. 3. Make recommendations to the Board of Commissioners before March 31, 2005, as to what the maximum rate that could be assessed, will be over what period of time, and how those rates should be apportioned. The thirteen member Committee met twice a month from August 2004 to March 2005. As shown on page two, the Committee was supported by County Staff who provided the Committee with guidance on financial and legal issues. Marty Wynne, the Finance Director, attended most, if not all, of the meetings and provided oversight on all finance data and assumptions. Scot Langton, County Assessor, provided historical and forecasted assessed value information. Sue Brewster of the Sheriff s Office Legal Counsel provided State Law and legal information. The Sheriff's business manager presented to the Committee the Sheriff's Office Strategic Plan which provides Sheriff's Office expenses and recommended estimates through the fiscal year 2020-21. The Sheriff and his Staff gave presentations to the Committee of the Sheriff's Office operations. In addition the Sheriff's Office provided a detailed assignment of Sheriffs Office employees, expenses, and revenues, to each district for district tax rate calculations. As shown on page three, the Committee recommended the creation of two Public Safety Districts. The Committee determined the Sheriff's Office employee's, expenses, and revenues of other services (the non property tax revenue), could be accurately assigned to each district. District One is a County wide district. This district would be established to fund the common Sheriff's Office services. Common services include the Adult Jail, Court Security, Civil Processing, Emergency Services, Search and Rescue, and Marine Patrol. District Two includes all areas in Deschutes County outside the City of Bend, Redmond, Sisters, and the Sunriver and Black Butte Ranch Service Districts. This Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 3 of 12 district would be established to fund Road Patrols, Investigations, and related Support Services. Page four is a summary of the key funding proposal identified in the Sheriff's Office Strategic Plan. The Committee accepted the Sheriff's Office Strategic Plan dated September 23, 2004 and served reference for the amounts of timing and costs be covered by the Committee recommended funding strategy. The Strategic Plan identified the funding required to achieve the Sheriff's Office objectives and strategies for the next fifteen years. Including the following key funding assumptions: 1. Operating expenses for reopening the Work Center. The assumption of the Strategic Plan is that the Work Center would be reopened in the first year permanent funding is available. The Work Center has the capacity of 90 beds. 2. Operating expenses for the expanded Jail. The 2004 Strategic Plan assumed expansion of the Adult Jail would occur in stages between 2010 and 2020. Operating expenses include funding for new corrections employee's, materials, and services. Construction costs are excluded from the funding assumptions. 3. Operating expenses for increasing staff in Patrol, Investigations, and Support. In addition to increasing employees in these organizations, the Strategic Plan also included funding in our Capital Reserve for infrastructure improvements, and contingency funds over the 15 year time period of the Strategic Plan. Finally, on page five, the rates recommended by the Committee are shown. The Committee recommended the maximum rates for each district. District One, the County wide district is a maximum tax rate of $1.25 and District Two, the rural areas, has a maximum tax rate of $1.55. The total of those two is the maximum tax rate of $2.80. Commissioner Luke: That is just for the rural? Ross: That would be for the rural. They would pay both District One and District Two rates. Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 4 of 12 Luke: That is if they both pass. They could end up just paying the one. Daly: Explain yourself. Stiles: If they voted down one of the Districts. It is important to take into account here the $2.80 per thousand, relative to other issues that we're currently paying for services, (I think $2.70 for Bend Metro Parks and Rec.) The City of Bend right now, right now today, is paying for their police services and sheriff's services, $2.40 per thousand (that is in the ball park.) In Redmond it is over $3.00. So, we don't anticipate hitting the permanent rate of $2.80 until 2015. Luke: There are no promises on that. Stiles: Obviously, we can't make promises. It is all going to dependent on what the voters do with respect to jail construction costs. We have got the staffing covered, but if they vote we do not want a jail, we will never get there. Luke: Sheriff, on the list of services, if there is a fire what rate is that in. Is that in the County wide rate, response to fire? Most of those fires are in a rural area. Stiles; Initially that would come out of the patrol division. It has been our experience that after you get past that initial response most of the people that show up are the emergency services personnel, patrol and corrections deputies wanting to catch some paid overtime. We keep our patrol folks as free as we can. Our liaison in the past has been Don Webber. I am hoping that Joe takes that position and even frees Don up. Luke; I would not count on that. Sheriffs Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 5 of 12 Stiles: Who better to liaison with fire than Joe? Luke: He has his hands full. But, to answer my question, the money comes out of the rural rate instead of the County wide rate? Stiles: No, the initial response does. The bulk of the expenses are going to come out of the forestry bulk, who are in the County wide under the special services section and corrections deputies, fifty, fifty. On the Davis fire we had more corrections deputies than patrol. On B&B we had more patrol because they were also working with the Secret Service on the President's visit. So, we just kept the patrol folks out there. Luke: One of the reasons we have not made this decision, since the first recommendation from March, was because the of the jail study. Why are we not waiting until that jail study is done before you are asking us to vote on this? Stiles: Because the jail study has no bearing on it, essentially. The jail study is going to make a recommendation relative to, should we expand and if so, by how much and by when. We took into account in our Strategic Planning process the numbers that are needed to staff the corrections side of the house. That's what we can go to in what was already approved by the Permanent Funding Advisory Committee. There are no costs in this rate for construction. Construction is a completely separate issue relative to whether or not the Board chooses to go out for general obligation bonds, or sell property in Redmond, or do nothing at all. Commissioner DeWolf• Would it be accurate to say that from the beginning of that jail study that we have gotten enough information to know that we are in the ball park for the operations? So, it is not necessarily that it is completely irrelevant, it's that we have enough information now to recognize... Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 6 of 12 Stiles: Tom is right, I had forgotten completely that they have already made a recommendation for us to build out to what was projected in 2002 and then wait until 2010 and see what happens. We are in the ball park right now for staffing for that build up. That is included in this rate and that is why the numbers are what they are. Lee Smith: I appreciate the Sheriff's comments, it was a very good Committee, well balanced, representing both rural and urban areas and a lot of different expertise. In addition to all of the Committee meetings, we probably had several hundred hours of exchanging emails, a lot of communication. We focused on two things. We focused first of all on what should be the structure and we had a number of different options to take a look at. We considered for example, having just a single Sheriff's district for all of Deschutes County. In the process of interviewing people like the Police Chief of Bend, the one from Black Butte Ranch and some others, we thought that there would be a strong resistance to having a County Wide District for the Sheriff where they would be paying the same amount. The cities felt that they were providing a lot of those same services themselves. So for that and some other reasons, looking at the equity issues, we decided that the best and fairest structure would be to have two separate districts. One paying for those services that are considered truly County wide, that includes the jail for example and the overall operations of the Sheriff's Office. Then a separate one for the rural areas that just covers the cost of rural patrols, which the cities indicated that was what they felt they should not have to pay for and be duplicating the effort. So, those are the two things that we looked at, first of all the structure and secondly try and figure out what the rates should be for the two separate districts that we were going to recommend. We did not look at trying to decide what ought to be funded, there was strong support for reopening the Work Release Center, but that was in the Sheriff's recommendations. We felt that we did an impartial job of trying to figure out what was the cost benefit analysis, who gets the benefits and how those costs should be divided. So, that is how we came up with the rates. Luke: Ultimately, this will be decided by the voters of Deschutes County. One of the reasons you are asking for a decision now is so that you can go before the City Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 7of12 Council so you can meet your time line for the filing for a mail action if the decision was to go in May. Stiles: We have not made that decision and frankly I would value the input of the Board and any one else I can get to give me input because there are a number of potential consequences attached to this. The reason it is important to make a decision right now is if we are going to go in May, our backs are against the wall. We have to file by the first week in December with the State Department of Revenue and the Secretary of State Ballot Title rate language. To do that we have got to get three resolutions of support from Bend, Redmond, and Sisters City Councils. To make the appointment to see them, we have to be able to tell them what the rate is so they can pass the resolution of support. Luke: Does the resolution of support from them have to specify which election? Stiles: No, it just simply says we support this rate, we support this concept. My fear is, what I did not want, is because if we fail to make a decision, we are defaulted into a November election and we don't have the option of a May election. I am very worried for host of reasons, not the least of which, in talking with our State Senator the other day, he let me know that McIntire has five issues, two of which he thinks will sustain sufficient signatures, and one of which is almost guaranteed will be on the ballot along with other ballot measures. He anticipates big, big bucks coming from outside the State of Oregon to campaign against taxes and government. Going against the Governor and everybody else trying to get the 50% in November, it has what, an 80% failure rate, as far as money measures. That's bad enough but to be competing for media time and space and running a campaign against a campaign that is pretty slick and highly financed, that is going to be against government and taxes, I am not sure that that is the environment we need to be in. That is why I am going to need some help. We at least need to set the rate so that we have the option of making that decision. If you don't make the decision, the decision will be made for us, and we're stuck with November whether we like it or not. Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 8 of 12 Luke: I think the Permanent Funding Committee did an excellent job. You guys did a lot of analysis. I know the Sheriff tried to guide you through this whole process, you guys are very successful in resisting him and we appreciate that. A very independent group. I know that Jim put together a lot of numbers, Marty reviewed those numbers and the Committee reviewed those numbers and spent a lot of time on them. LUKE: Move approval that the County Commissioners support the County Wide Rate of $1.25 per thousand and a Rural Rate of $1.55 per thousand. DALY: Second. Daly: I want to comment though. I came to work and heard on the radio about the rate per thousand. It is a substantial amount of money but what they did not say was that that rate would probably not be levied until fifteen years from now. So, I think we need to make it very clear that this rate, the one we are looking at here, probably won't be levied until fifteen years down the road. Stiles: Probably about ten. Daly: Ten years? Stiles: In 2014. Ross: Actually, 2013. Luke: Sunriver had the same cell though. When Sunriver formed their district down there, they had to go in with the higher rate. You have to, that is what the law says. Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 9 of 12 Daly: I just want to make it very clear that this rate is way down the road; it is not going to happen this first year. Luke: You can't say that. You can tell them that this is the projection, that is what your budget shows but you cannot make promises. There is nothing that says that the Budget Committee and the Commissioners can't enforce the full rate in the first year. Stiles: Frankly, Commissioner Daly hit the nail right squarely on the head. That is going to be the biggest hurtle that we are going to have to sell in nine months of campaigning to educate people about. They are going to see $2.80 and they are going to go tomorrow morning, to them, it is tomorrow morning. I don't know how we get around that other than to do everything we can possibly do to say we have indexed it to this, this is what we reasonably believe, we have done our homework and put together the Strategic Plan, it is in your hands. We don't see this coming until way down stream. DeWolf: Part of what we can do is as part of the ballot measure, and I am not sure how to legally do the wording, but we can put what the intention is. You have this all year, by year, what the anticipated rates are and so that can be put in the ballot measure. If the Budget Committee or the Sheriff, at that time, has an inclination to go beyond what was promised, at least the voters will have that historical document that says wait a second, this is not what we agreed to. That's the one thing that even though, Dennis is right, we can't guarantee it, we can sure let future folks know that hold these offices what the intention was when this was passed. Luke: You can't make promises in a ballot title. DeWolf: I said intentions, Dennis, I said intentions. Luke: You can definitely establish a record. Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 10 of 12 DeWolf This is what was intended, yep. Daly: It just occurred to me in hearing the radio this morning that we are starting off on the wrong foot with that kind of media coverage because it is giving the wrong impression before we have even made this decision. Luke: Does Brian Cambridge sensationalize stuff? Daly: I was just bringing that point up. Stiles: I talked to Jeff and I said Jeff, he has got it wrong, you are creating a false picture. Frankly, I am afraid we are going to deal with that for nine months and that is the perception we have to change. Luke: All you can do is get very good stories to the visual media and print media. DeWolf It may well be that that's one of the reasons to go out in May, that you try and get the best message out that we can, get the 50% and get if passed. If it doesn't, we've still got the opportunity to come back in November, you know, with the message refined even further. I am not suggesting that that's where we are at but doing this now gives us that option. Stiles: There in lies part of my fear. I took one of my supporters out Thursday evening last week for a trip to East Lake and said I need $5,000 for the campaign. That is what he has given me in the past and he said why would I want to do that, give you money to increase my taxes. In the end, we are going to get to do this once. We are going to raise enough money that we are going to get to do it once. If it does not pass, it will probably be long past my lifetime before the topic comes up again. Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page II of 12 Luke: I am ready to vote. VOTE: LUKE: Yes. DALY: Yes. DEWOLF: Chair votes yes. Being no further input, the meeting adjourned at 4: 55 p.m. DATED this 15th Day of August 2005 for the Deschutes County Board of Commissioners. ATTEST: Recording Secretary Tom DeWolf, Chair Attachments: Exhibit A: Sheriff's Office Funding Rate Setting Meeting - Handout (5 pages) Exhibit B: Sheriff's Office Permanent Funding Advisory Committee - letter to the Board of Commissioners (6 pages) Sheriff's Office Permanent Funding Rate Setting Meeting August 15, 2005 Page 12 of 12 Dennis R. Luke, Commissioner 0 X cc wa I V~ 0 N H cd 0 A-a March 21, 2005 Sheriff's Office Permanent Funding Advisory Committee Allan Bruckner Jacques DeKalb Judy Duncan Chris Earnest Gary Everett Charles Humphreys Dennis Krakow Daryl Nakahira Bill Pfeiffer Karen Rawnsley Leland Smith Lindsay Stevens Randy Wight Board of County Commissioners Deschutes County 1130 NW Harriman Street Bend, OR 97701 This letter presents the recommendations of the Sheriff's Office Permanent Funding Advisory Committee (SOPFAC) to the Deschutes County Board of Commissioners. The Mission Statement provided to the Committee at our first meeting stated that our mission was three-fold: 1. Evaluate the present funding mechanisms for the Deschutes County Sheriffs Office. 2. Based on the evaluation, determine a funding mechanism that would best serve the needs of the residents of Deschutes County and assure continued public safety services. 3. Make recommendations to the Board of Commissioners on or before March 31, 2005 as to what the maximum rate that could be assessed will be over what period of time AND how should those be apportioned. The Committee was also provided with a list of seven "parameters" which were used to guide our deliberations. These instructed the Committee to utilize budget and cost data provided by the Sheriff, the County Finance Director, and the County Assessor without changes. Consequently, the Committee accepted the Deschutes County Sheriff's Office Strategic Plan Update, September 2004, as our reference for the amounts and timing of costs to be covered by a new funding strategy. Our recommendations are contained in two motions that were approved by a majority of the Committee members. There was substantive discussion about the approved recommendations, as well as several alternatives, which the Committee felt should also be summarized and conveyed to the Commissioners. While not formalized by motions, please review that summary and consider it as integral to our recommendations. Exhibit Page / of RECOMMENDATION 1- PERTAINING TO STRUCTURE The Committee recommends the creation of two Public Safety Service Districts: DISTRICT ONE A countywide district with a rate to be approved by a vote of all eligible voters in Deschutes County. The rate determined will be based upon the allocation of services as defined by the Sheriff in his document titled "Identification of Employees and Costs between County-wide and Rural Tax Districts" dated 12-7-2004. The rate will NOT include the costs of constructing new jail facilities but WILL include the estimated costs of current and projected expanded jail operations and the re-opening of the Work Release Center. The rate established will be the maximum rate required to fund Sheriff services as defined through FY 2020-21 but will be assessed annually as necessary by the Board of County Commissioners and will assume the continued availability of "Other Revenue" as shown in the Sheriff's Strategic Plan dated September 2004. DISTRICT TWO This District would include all areas in Deschutes County outside of the cities of Bend, Redmond and Sisters, and the Sunriver and Black Butte Ranch Service Districts. This district would be established to fund rural patrols, investigations and related support services as defined by the Sheriff in his document titled "Identification of Employees and Costs between County-wide and Rural Tax Districts" dated 12-7-2004. Funding for this district would be voted upon only by eligible voters residing in this district. The rate established will be the maximum rate required to fund services as defined above through FY 2020-21 and will be assessed annually by the Board of County Commissioners and will assume the continued availability of "Other Revenue" as shown in the Sheriff's Strategic Plan dated September 2004. The Committee further approved a motion to recommend to the Board of County Commissioners that the formation and tax rate of either district not be dependent upon the passage of the other district. SOPFAC Recommendations 2 March 21, 2005 To BOCC Exhibit .0 Page ;i-_ of RECOMMENDATION 2- PERTAINING TO RATES The Committee recommends the following maximum and initial tax rates to be set for the two districts: District One: Maximum tax rate of $1.25 per $1,000 of assessed value. Initial tax rate of $0.90 per $1,000 of assessed value in FY 2006-07. District Two: Maximum tax rate of $1.55 per $1,000 of assessed value. Initial tax rate of $1.45 per $1,000 of assessed value in FY 2006-07. Projections from the Sheriff's Office show that the maximum rates will be required in FY 2013- 14 to cover the increased costs of the expanded jail operations. Rates should be reduced beyond that point because property tax revenues are projected to increase faster than costs. Respectfully submitted, Leland F. Smith, Chairman SOPFAC Recommendations 3 March 21, 2005 To BOCC Exhibit .d Page 3 of CP. DISCUSSION SUMMARY AND ADDITIONAL RECOMMENDATIONS The recommendations of the Sheriff s Office Permanent Funding Advisory Committee to the Deschutes County Board of Commissioners were approved by a majority of the members operating under Robert's Rules of Order. However, there was not unanimous agreement on some of these recommendations. Many different ideas and opinions were expressed during the series of meetings, with time made available for expressing and discussing the views of all members. The following discussion summary addresses the primary issues considered by the Committee and includes the positions supported by the minority members. For more detailed information on the Committee's deliberations, please review the minutes of the individual meetings. The Committee considered the alternatives of forming one, two, or three districts as described below: One District: A single district was evaluated that would have covered all of the operating costs of the Sheriff's Office that require property tax revenues, with a single tax rate dividing the costs equally among all County taxpayers according to their assessed valuations. At least one Committee member felt that this would be the most fair and equitable method, and many agreed it would be the simplest to design. Other members felt that this option would place an unfair tax burden on residents of the three incorporated cities and two service districts who are paying for their own police services. There were also questions about whether this option would be approved by the respective city councils as required, and whether urban voters would pass such a measure on the ballot. Two Districts: The two-district option was ultimately approved by a 10-to-1 vote with one abstention, primarily for the reasons above. In addition, many members felt this option most closely follows the existing precedent of a split-levy that has been approved by the voters. The Sheriff s Office provided a breakdown of employee assignments which showed whether they were primarily for the benefit of county-wide or rural residents as contained in the December 7 document. The Sheriff s Office also provided detailed cost projections of the services of each district. These were matched against projected property tax revenues from the Assessor's Office to show the rates that would be required in each of the two districts to fully cover the costs. Three Districts: There was some discussion about forming a third district that would function only to build and operate the jail facilities. The three-district option was unduly complicated and did not offer significant benefits over the two-district option. Exhibit e) Page-A- of Le 2. There was also substantive discussion about whether some of the costs of patrol and investigative services should be divided between both districts rather than fully assigned to just one. At least one member felt that Sheriffs patrols benefit all residents in Deschutes County to some extent, even if they are primarily conducted in rural areas. That member favored assigning some part of the costs of patrols to the county-wide district, thereby reducing the tax rate in the rural district while increasing it in the county-wide district. Other members felt that residents of the incorporated cities and two service districts are already paying for patrol services, without tax support from the rural areas, and they should not have to pay additional taxes for rural patrols. The Committee voted 8 - 2 to fund all patrol and investigative services by residents of District 2. 3. The maximum rate recommended for District One is intended to cover the full operating costs of expanded jail facilities to be constructed at various times between FIT 2007-08 and FY 2020-21. The Committee agreed unanimously that the maximum rate SHOULD NOT be levied unless and until the voters approve the bonds or other financing mechanisms for the jail expansions. If the construction bonds for the jail are not approved by the voters, or for any other reason those jail expansions should not occur, then the annual levies should be at rates lower than the maximum. In that event, any amount of the maximum rate allocated to jail operations should be considered as a reserve for future jail operations and should not be levied and/or used for other purposes. The Committee did not consider alternatives to the jail because the Sheriffs calculations were based solely on the expansion of the jail. 4. The Committee was provided by the Sheriff's office with a spreadsheet showing the annual tax rates that would be required in order to fully fund Sheriff's services through FY 2020-21 under the assumption that the jail expansions would occur. That spreadsheet incorporated projections provided by the Assessor's office showing increases in assessed valuations in Deschutes County during that time period. The Assessor's projections included a breakout for the rural areas of the county, which enabled the Sheriffs office and the Committee to assign costs to the two districts respectively. The Committee strongly recommends that the projections of annual tax rates be included in the ballot language to show that the initial rates are not the maximum rates, the time periods when higher rates are anticipated, and that the rates are expected to decline after the jail expansions are completed and fully operational. The Committee also recommends that the Budget Committee consider the Sheriff's projections in setting annual tax rates for both districts. 2 Exhibit e) Page 5 of - _ 5. The ballot to form District One should clearly show what the maximum rate assessed will be if the expanded jail facilities are not constructed. While the Committee was aware that the County cannot set a "contingency" rate, the members felt that the voters have a right to know what portion of the maximum rate is assigned to the expanded jail operations. 6. There was considerable discussion about whether the Committee should recommend increases in the allocation of the Transient Room Tax to fund Sheriff's services in District 2. There was also discussion about whether the General Fund allocation to the Sheriff's office should be increased and/or maintained at a higher level even as Transient Room Taxes increase over time. The Committee agreed that the BOCC and the Budget Committee should consider these and other revenue options in order to reduce the property tax rates for the two districts. 7. There was considerable discussion about whether the passage of the two permanent tax districts should be linked, i.e., whether the failure of one district should automatically cause the failure of the other, even if it received majority approval. In particular, some Committee members felt that the Rural District, primarily dedicated to financing patrols and investigations, should not be formed if the County-wide District, largely dedicated to financing the jail operations and general administration, should fail. It was unanimously decided and recommended that each district should stand on its own and that urban residents should not be able to deny rural residents the opportunity to form their own district independently of the County-wide District. Respectfully submitted: Leland F. Smith 3 Exhibit B Page t of