Friday, October 30, 2015

Multnomah County Property Tax Appeals

The news is out. It seems like Multnomah County is taking advantage of the accessory dwelling unit (ADU) situation in Portland. In 2010 the city decided to waive systems development charges (SDC) on new ADU creation whether that be converting a garage, carving space out of a basement or building a brand new structure. This was great as it enabled the building of thousands of permitted ADUs.

(cue impending music)

Now that we have a bajillion ADUs in the city Multnomah county decided to strike. Obfuscating state code they have interpreted a re-use as a re-zone and have JACKED property taxes up on many properties with newly built ADUs. The problem is that they are not only reassessing the improved value of the ADU itself but pretending as if the house is brand new construction as well. Even if it was built in 1924! The net effect is that Multnomah County is shooting themselves in the foot by killing the detached ADU industry.

The Oregon State Department of Revenue has said that Multnomah County is probably doing it wrong but they aren't enforcing or overruling any judgements yet.

Plenty has been written on this already and developments are appearing. The point of this brief is to not dig into more detail but to offer some solutions:

  • Contact the county staffer about this:

Dave Austin

  • It's possible that a class action suit may arise.

  • Or appeal the taxes on your own. I hope you're smart!
  • There are several exemptions you can file for including active military service, veterans, elderly, disabled, enterprise zones and non-profits. From personal experience it is not terribly difficult to become a non-profit. Doing the paperwork yourself is fairly cheap and you don't necessarily need 501(c)(3) status to be a state non-profit. But be sure that your non-profit use is accurate and that you are not the sole beneficiary. If you are housing your elderly folks, maybe you could set yourself up as a care home?
  • You may also be able to revert your taxes by connecting your ADU to your main house. Some restrictions may apply. The County may or may not reassess backwards. Contact us for a free assessment of your options.
Good luck! Hopefully we can just get this reversed and tar and feather those in charge.

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