Brahm Ekstrand, administrator of the Property Tax Division at the Oregon Department of Revenue, briefed the Joint Committee on Ways and Means Subcommittee on General Government on March 11 about the division's appraisal responsibilities, modernization projects and a funding request to cover a shortfall in other funds.

Ekstrand said the division appraises specialized property statewide — including industrial, utility, and centrally assessed companies — and appraises more than 8.2 million acres of private forest land annually. He told the committee the state's appraised-value work attributable to Oregon for centrally assessed companies exceeds $34 billion.

Why it matters: Property valuations determined by the department affect tax bills and revenue for state and local services. Changes in the division’s funding and technology systems influence counties' ability to process tax rolls and maintain uniform appraisal practices.

Scope of programs and oversight: Ekstrand described four primary oversight functions: administering the CAFA grant program that supports county assessment staffing; reviewing certified ratio reports that counties submit annually; providing appraiser testing and continuing education; and prescribing statewide mapping standards. He said ORMAP (the statewide digital base map funded by a $1 document recording fee that generates about $800,000 annually) has converted 87% of tax maps to digital format and 20 counties have reached ORMAP goal 6 for highest accuracy.

Industrial and central assessment valuation work: The division annually values more than 800 companies in industrial valuation and central assessment, generating about $800 million and attributing more than $34 billion in company value to Oregon. Ekstrand described an annual review process in which returns are manually processed each year with on-site inspections and full reappraisals performed when activity indicates the need. Depreciation disputes were described as a common point of contention between the department and taxpayers in industrial valuations.

Modernization and project status: Ekstrand and other staff said the department completed modernization of the central-assessment software and is working on the industrial-valuation portion as part of the Elvis project. Presenters said they had encountered vendor issues, adopted a contingency plan, and were launching a formal project kickoff for the contingency work; they said they were "on track to go live in January," and that they expect to remain within budget.

Funding request and CAFA/CAPA notes: The division requested $1.3 million general fund this biennium to cover a decline in other-fund revenues that historically funded appraisal positions. Ekstrand said appraisal positions are partially funded by an other fund source he referred to as "CAPA/CAFA" during testimony; he explained that statutory limits cap the department’s share of that funding and that revenues are not indexed, creating a gap between personal-service costs and available other funds. Committee members asked whether this request would only sustain current operations; Ekstrand said the request is to maintain existing services and positions rather than add staff.

Senior and disabled deferral program: Ekstrand described the senior/disabled deferral (senior-deferral) program that places a lien on qualifying properties and pays county property taxes for participants. He said the program pays about $12 million annually on behalf of participants and that the revolving account that funds the program had been depleted previously but now holds about $70 million. Ekstrand said participation has been declining and staff reported common reasons: applicants' reluctance to place a state lien on their homes and concerns about reduced home value for heirs. The department confirmed the 6% simple interest charged on deferrals is established in statute.

Ending: Ekstrand said the division continues outreach and training for county partners and requested that the committee consider the $1.3 million general-fund request to avoid service interruptions; the informational hearing continued with the collections division briefing.