The Multnomah County Board of Commissioners on Thursday, Sept. 22, will vote on a resolution to reduce property taxes for manufactured homes as a way to keep 5,000 residents more stably housed.
The effort to keep manufactured homes affordable for people with low or fixed incomes dates back more than a decade as the County has worked to ease tax burdens for people who own their manufactured home but not the land underneath. In 2009, then-Commissioner Deborah Kafoury and County staff worked through the Oregon Legislature to lay the foundation for alleviating the tax burdens of some of the most vulnerable manufactured homeowners by establishing a $38,000 property tax cancellation for manufactured homes.
"This resolution represents a sensible and equitable evolution of our past efforts to keep this housing affordable in the face of rising property values and lagging new construction," said Chair Kafoury. "Ultimately, it will offer more stability and security to owners of manufactured homes."
In 2019, Commissioner Lori Stegmann worked with the Oregon Legislature to include a property tax exemption for counties with a population of 570,000 or more, allowing them to adopt their own exemption threshold up to $50,000, up from $38,000. Rather than a cancellation for properties valued at $38,000 or below, the bill allows for a property tax exemption, which benefits all homeowners.
“We were concerned that mobile home values were increasing rapidly and that it would result in an inequitable burden on many fixed and low income communities,’’ said Commissioner Stegmann.
But as property values rose in the County, the number of households who qualified for the cancellation has shrunk. There are currently 4,917 mobile homes in Multnomah County. Of those units, 3,016 received a property tax cancellation for the 2021-2022 tax year. But since 2020, 72 manufactured home households have moved over the $38,000 threshold, losing the property tax cancellation.
Creating a property tax exemption of $50,000 would exempt another 726 homes from receiving a property tax bill, and all 4,917 mobile homes would benefit from a reduced property tax burden.
County Assessor Michael Vaughn told commissioners at a briefing on Tuesday that currently, if a manufactured home was valued even one dollar over the $38,000, the owner is hit with the full tax bill — as much as $1,000 in some locations. So in addition to increasing the threshold to $50,000, the resolution that the Board will consider would also offer additional relief by creating a partial exemption meaning that a property valued at the threshold amount is always exempt and only the amount above that is taxed.
For example, for a manufactured home valued one dollar over the $50,000, only the additional dollar would be taxed under the proposed resolution.
“This is a policy that benefits all manufactured homeowners,’’ Vaughn said. “But it’s also a future-looking policy as values continue to fluctuate. As they increase over the years, we’ll continue to benefit this population. And certainly what we’ll see is not the all-or-nothing policy that we currently have in statute.’’
Commissioner Susheela Jayapal, who championed the resolution with Commissioner Stegmann, agreed.
“While this proposal to increase the exemption on manufactured homes does not address the deep inequities created by our overall tax system, it brings forward changes that will deliver benefits to some of our lowest-income residents,’’ Jayapal said. “At a time when we’re facing a crisis of houselessness caused by the lack of affordable housing, we have to use every tool in our toolkit to keep housing affordable.”
If the Board adopts the resolution, the new exemptions would reduce tax revenue collected by Multnomah County by $350,000, and up to $3 million across taxing districts. In August, Taylor Steenblock from the County’s Office of Government Relations reached out to more than 50 special taxing districts and local governments describing the impacts of various scenarios.
“We did not hear concerns,’’Steenblock reported back to the Board Tuesday. “It seems a lot of people in those districts and governments understand the impact that the increase in (property) value is having on these families. They understand this decision will be very helpful for them, for keeping them in their homes long-term, and for preserving that affordable housing.’’