By KYLE IBOSHI/KGW.TV
OTIS — Survivors of Oregon’s devastating wildfires are facing hefty taxes to rebuild their homes. In Lincoln County, an obscure construction tax intended to help the local school district build classrooms is being imposed on wildfire victims.
“They’re kicking you while you are down,” said John Skelton of Otis.
Skelton and his wife, Casey, barely escaped before the Echo Mountain Fire destroyed their home east of Lincoln City. All that remains on the rural property is a skeleton of steel, broken pieces and melted glass.
“This is home,” said Skelton, who is working with an old friend, Douglas Bernhardt, to rebuild.
When the men applied for a permit, Lincoln County warned they had to pay a new construction tax of nearly $2,000. The men tried to explain this wasn’t new construction. They were simply replacing a manufactured home.
County officials wouldn’t budge. Wildfire victims had to pay.
“We didn’t start this fire. We didn’t ask for this,” said Skelton.
Nearly 300 homes were lost in the Echo Mountain Fire.
“Everything is gone. Only thing left of my property is sheet metal,” said neighbor John Parrott.
Parrott is working with his family to rebuild their Otis home, but fears insurance will only cover so much of the cost.
“I’m living in a trailer,” said Parrott. “It’s going to be 33 degrees tonight. They need to come out there and help us. Not be charging people extra taxes.”
The construction excise tax allows local school districts to charge for construction, if they want. The tax money helps accommodate growth, so districts can pay for more classrooms and improved buildings.
In Lincoln County, the construction excise tax started in 2008 and currently is $1.24 per square foot for new or replacement homes.
Earlier this month, Bernhardt appeared before the Lincoln County School Board. He asked that wildfire victims receive a waiver, making them exempt from paying the construction excise tax.
“It’s not a new burden on the school district so why should they have to collect that money?” asked Bernhardt.
During the October 13 meeting, Lincoln County School Board members said their hands were tied because of how the state law was written. Despite losing their homes to wildfire, the victims would have to pay.
“There are no exceptions I am aware of,” said Lincoln County School District Superintendent Karen Gray in an email to KGW. “The law requires that we collect it at the board approved rates.”
Gray declined an interview request.
“I would absolutely support a change that includes exemptions for homes affected by natural disasters,” wrote board chair Megan Cawley in an email.
A review of local tax records shows there are potentially hundreds of Oregonians who lost their homes in the Almeda Fire, the Holiday Farm fire and the Beachie Creek fire who could be assessed similar construction excise taxes by their local school districts when rebuilding.
“This was so not the intent,” said former state senator Ryan Deckert, who sponsored the 2007 legislation creating the Construction Excise Tax.
Deckert explained school districts have the leeway to provide waivers.
“I’d be really disappointed and surprised if they charged the wildfire victims this fee because it would relatively easy for them not to do it,” said Deckert.
Some school districts provide tax waivers for victims of natural disasters.
The Greater Albany school district doesn’t charge a construction excise tax for “Replacement due to fire or flood loss equal to or less than the square footage of the original structure prior to the loss.”
The North Santiam School District waived its construction excise tax for victims of the Beachie Creek fire during an October 15 board meeting.
“It certainly can be done. Any district can waive it,” explained board chair Mike Wagner.
The temporary waiver applies to new construction within the North Santiam School District boundaries until March 2021. Homeowners requesting an exemption had to own and occupy the property at the time of the fire.
“Somebody who had their home burned- they don’t need to have extra tax put on when they are rebuilding their home,” said Wagner.
Rep. David Gomberg, D-Otis, said he is working to clear up confusion statewide. Gomberg said he is drafting legislation that would allow school districts to waive the construction excise tax for those impacted by a declared natural disaster or emergency.
“Let’s fix this. That way there won’t be a question,” said Gomberg.
In an email on Thursday, Gray said the district is working with Gomberg to get clarification or an exemption from the Legislature and encouraged patrons to contact legislators on the issue.
“We are 100% for getting exceptions due to natural hazards and stand ready to do that but we cannot until we get legal permission to do so,” Gray said in her email. “The board cannot be asked to break the law even if other districts do so. They sincerely want to help in any way they can and they have done so. LCSD has done many things to help our community during this terrible time. From feeding so many people, allowing schools to act as Red Cross sites when needed, transporting people around the county, opening our schools for people to use showers and do laundry, educating kids at school who have been displaced by fire damaged or destroyed homes, and more. We love our community and want to help in any way we can.”
In the meantime, wildfire victims in Lincoln County are frustrated there’s no tax relief as they try and rebuild their lives.
Instead, just the opposite. The Lincoln County School District is looking to increase the construction excise tax. The school board is scheduled to vote on the tax increase Nov. 10.
