IN THE OREGON TAX COURT MAGISTRATE DIVISION Property Tax
JOHN ERIC POLLARD, ) and REBECCA SUE POLLARD, ) ) Plaintiffs, ) TC-MD 200396R ) v. ) ) DESCHUTES COUNTY ASSESSOR, ) ) Defendant. ) DECISION
Plaintiffs appealed the assessment of property identified as Account 165429 for the 2020-
21 tax year. A trial was held on June 9, 2021, via web conference. John Pollard (Pollard)
testified on behalf of Plaintiffs. Todd Straughn, Eric Sexton (Sexton), and Zachary Hastings
testified on behalf of Defendant. Plaintiffs’ Exhibits A through CC and Defendant’s Exhibits A
through H were received as evidence.
I. STATEMENT OF FACTS
Plaintiffs began construction on their home in Bend during 2018, completed the home in
November 2019, and received an occupancy permit on November 8, 2019. (Ex A at 1). For the
2019-20 tax year, Defendant initially assessed Plaintiffs’ property as having a maximum assessed
value (MAV) of $448,110. (Ex B at 1.) The parties negotiated an agreement to reduce the
property’s real market value (RMV) to $618,630 and the MAV to $275,890 for the 2019-20 Tax
Year. 1 (Ex F at 1.) At trial, Pollard testified that he believed the assessment was reduced because
Plaintiffs had occupied the home for only 204 days, which constituted 56 percent of the year. (See
also Ptfs’ Closing Argument at 1.) In negotiating the stipulated agreement, Plaintiffs stated in an
1 Defendant reached the MAV by multiplying the stipulated RMV by the changed property ratio (CPR).
DECISION TC-MD 200396R 1 email to Defendant that “[w]e would be grateful if you can base your 56 percent completion on the
assessment number.” 2 (Ex C at 2.) Sexton testified that Defendant reduced the assessment on the
basis that the structure was 56 percent complete as of January 1, 2019. (Ex A at 1, 3.)
As of January 1, 2020, Defendant assessed Plaintiffs’ property as 100 percent complete.
(Ex A at 3.) Plaintiffs received their 2020-21 tax statement, which included a nearly 20 percent
increase in their MAV, and they appealed to the county Board of Property Tax Appeals
(BOPTA) to reduce the increase in their MAV. (Ptfs’ Ex Z at 1.) BOPTA found a clerical error
that resulted in a small decrease in Plaintiffs’ MAV, but upheld Defendant’s method of
calculating Plaintiffs’ MAV. Plaintiffs appeal this decision.
II. ANALYSIS
Whether the property’s 2020-21 MAV was calculated correctly depends on if Defendant assessed
Plaintiffs’ property as having a completed home for the 2019-20 tax year. If the home was assessed as
complete, then Defendant could not increase the MAV of Plaintiffs’ property by more than three percent
for the 2020-21 tax year. If the home was not assessed as complete, then the MAV of Plaintiffs’ property
should be adjusted to account for its increase in value resulting from the improvements.
A. Property Taxation in Oregon.
Real property is assessed on the lesser of its real market value or its maximum assessed
value. ORS 308.146(2). While a property’s real market value can change dramatically from
year to year, the MAV of a property can only increase by three percent each year, unless
exceptions to the general rule, such as new property improvements, allow for a greater increase.
ORS 308.146; 308.153. 3 New property and new improvements not subject to the three percent
2 No pictures of the home on January 1, 2019, were presented at trial. However, in Exhibit H, Defendant presented photos of the partially completed home in May 2019. 3 Unless otherwise stated, the Oregon Revised Statutes (ORS) 2019 version is used.
DECISION TC-MD 200396R 2 limit are defined as changes in the property value resulting from, “[n]ew construction,
reconstruction, major additions, remodeling, renovation or rehabilitation of property” and are
“integral part[s] of the land or improvements on the assessment date.” ORS 308.149(6)(a)(A);
308.153(3)(a)(A). When improvements are made during the year, they are added to the property
tax account as of the January 1 assessment date of the following tax year. See Chart
Development Corp. v. Dept. of Rev., 17 OTR 170, 171 (2003) (explaining in which situations
MAV is subject to recalculation). For new property and new improvements, the real market
value of the new improvements is multiplied by the changed property ratio (CPR) and added to
the existing maximum assessed value. ORS 308.153(1). The CPR is “the ratio of average
maximum assessed value to average real market value of property located in the area in which
the property is located that is within the same property class.” Or Const, Art XI, § 11(1)(c); see
also ORS 308.153(1)(b). The value of new improvements is “the real market value” of the new
improvements less the real market value of any retirements. ORS 308.153(2)(a).
Plaintiffs contend that, following the stipulated agreement with the county, Defendant assessed
their home as 100 percent complete but that Plaintiffs were charged taxes for only 56 percent of the
year, which was the time during the tax year that they occupied the structure. Plaintiffs are thus asking
the court to conclude that their property’s MAV for January 1, 2019, reflects a completed structure so
that the property’s MAV does not increase by more than three percent for the 2020-21 tax year.
Defendant contends that the stipulated agreement did not result in the assessment of a completed
structure, but rather that the structure on the property was assessed as 56 percent complete on January
1, 2019. Defendant asks the court to conclude that the January 1, 2020, assessment reflects the
property as having a finished structure and is thus subject to partial re-calculation of its MAV due to the
additional 44 percent completion during 2019, pursuant to ORS 308.153.
DECISION TC-MD 200396R 3 Oregon taxes property owners for their interest (i.e., ownership rights) in the property,
not for their use of the property. Ellison v. Dept. of Rev., 362 Or 148, 168-69. See also Dish
Network Co. v. Dept. of Rev., 364 Or 254, 434 P3d 379 (2019) (providing further explanation on
Oregon’s property tax scheme after Measure 50 and clarifying that “new property” includes all
property that is newly added to the taxpayer’s tax account by the assessor). This interest is
assessed only on existing property; assessors are incapable of assessing property that does not
exist. Because Defendant assessed Plaintiffs’ home for the additional 44 percent completion
during 2019, their property tax increased more than three percent. The stipulated agreement
from the prior year did not calculate the MAV as having a complete structure, but instead as
having a partially completed structure. Indeed, Defendant would not be authorized to impose
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IN THE OREGON TAX COURT MAGISTRATE DIVISION Property Tax
JOHN ERIC POLLARD, ) and REBECCA SUE POLLARD, ) ) Plaintiffs, ) TC-MD 200396R ) v. ) ) DESCHUTES COUNTY ASSESSOR, ) ) Defendant. ) DECISION
Plaintiffs appealed the assessment of property identified as Account 165429 for the 2020-
21 tax year. A trial was held on June 9, 2021, via web conference. John Pollard (Pollard)
testified on behalf of Plaintiffs. Todd Straughn, Eric Sexton (Sexton), and Zachary Hastings
testified on behalf of Defendant. Plaintiffs’ Exhibits A through CC and Defendant’s Exhibits A
through H were received as evidence.
I. STATEMENT OF FACTS
Plaintiffs began construction on their home in Bend during 2018, completed the home in
November 2019, and received an occupancy permit on November 8, 2019. (Ex A at 1). For the
2019-20 tax year, Defendant initially assessed Plaintiffs’ property as having a maximum assessed
value (MAV) of $448,110. (Ex B at 1.) The parties negotiated an agreement to reduce the
property’s real market value (RMV) to $618,630 and the MAV to $275,890 for the 2019-20 Tax
Year. 1 (Ex F at 1.) At trial, Pollard testified that he believed the assessment was reduced because
Plaintiffs had occupied the home for only 204 days, which constituted 56 percent of the year. (See
also Ptfs’ Closing Argument at 1.) In negotiating the stipulated agreement, Plaintiffs stated in an
1 Defendant reached the MAV by multiplying the stipulated RMV by the changed property ratio (CPR).
DECISION TC-MD 200396R 1 email to Defendant that “[w]e would be grateful if you can base your 56 percent completion on the
assessment number.” 2 (Ex C at 2.) Sexton testified that Defendant reduced the assessment on the
basis that the structure was 56 percent complete as of January 1, 2019. (Ex A at 1, 3.)
As of January 1, 2020, Defendant assessed Plaintiffs’ property as 100 percent complete.
(Ex A at 3.) Plaintiffs received their 2020-21 tax statement, which included a nearly 20 percent
increase in their MAV, and they appealed to the county Board of Property Tax Appeals
(BOPTA) to reduce the increase in their MAV. (Ptfs’ Ex Z at 1.) BOPTA found a clerical error
that resulted in a small decrease in Plaintiffs’ MAV, but upheld Defendant’s method of
calculating Plaintiffs’ MAV. Plaintiffs appeal this decision.
II. ANALYSIS
Whether the property’s 2020-21 MAV was calculated correctly depends on if Defendant assessed
Plaintiffs’ property as having a completed home for the 2019-20 tax year. If the home was assessed as
complete, then Defendant could not increase the MAV of Plaintiffs’ property by more than three percent
for the 2020-21 tax year. If the home was not assessed as complete, then the MAV of Plaintiffs’ property
should be adjusted to account for its increase in value resulting from the improvements.
A. Property Taxation in Oregon.
Real property is assessed on the lesser of its real market value or its maximum assessed
value. ORS 308.146(2). While a property’s real market value can change dramatically from
year to year, the MAV of a property can only increase by three percent each year, unless
exceptions to the general rule, such as new property improvements, allow for a greater increase.
ORS 308.146; 308.153. 3 New property and new improvements not subject to the three percent
2 No pictures of the home on January 1, 2019, were presented at trial. However, in Exhibit H, Defendant presented photos of the partially completed home in May 2019. 3 Unless otherwise stated, the Oregon Revised Statutes (ORS) 2019 version is used.
DECISION TC-MD 200396R 2 limit are defined as changes in the property value resulting from, “[n]ew construction,
reconstruction, major additions, remodeling, renovation or rehabilitation of property” and are
“integral part[s] of the land or improvements on the assessment date.” ORS 308.149(6)(a)(A);
308.153(3)(a)(A). When improvements are made during the year, they are added to the property
tax account as of the January 1 assessment date of the following tax year. See Chart
Development Corp. v. Dept. of Rev., 17 OTR 170, 171 (2003) (explaining in which situations
MAV is subject to recalculation). For new property and new improvements, the real market
value of the new improvements is multiplied by the changed property ratio (CPR) and added to
the existing maximum assessed value. ORS 308.153(1). The CPR is “the ratio of average
maximum assessed value to average real market value of property located in the area in which
the property is located that is within the same property class.” Or Const, Art XI, § 11(1)(c); see
also ORS 308.153(1)(b). The value of new improvements is “the real market value” of the new
improvements less the real market value of any retirements. ORS 308.153(2)(a).
Plaintiffs contend that, following the stipulated agreement with the county, Defendant assessed
their home as 100 percent complete but that Plaintiffs were charged taxes for only 56 percent of the
year, which was the time during the tax year that they occupied the structure. Plaintiffs are thus asking
the court to conclude that their property’s MAV for January 1, 2019, reflects a completed structure so
that the property’s MAV does not increase by more than three percent for the 2020-21 tax year.
Defendant contends that the stipulated agreement did not result in the assessment of a completed
structure, but rather that the structure on the property was assessed as 56 percent complete on January
1, 2019. Defendant asks the court to conclude that the January 1, 2020, assessment reflects the
property as having a finished structure and is thus subject to partial re-calculation of its MAV due to the
additional 44 percent completion during 2019, pursuant to ORS 308.153.
DECISION TC-MD 200396R 3 Oregon taxes property owners for their interest (i.e., ownership rights) in the property,
not for their use of the property. Ellison v. Dept. of Rev., 362 Or 148, 168-69. See also Dish
Network Co. v. Dept. of Rev., 364 Or 254, 434 P3d 379 (2019) (providing further explanation on
Oregon’s property tax scheme after Measure 50 and clarifying that “new property” includes all
property that is newly added to the taxpayer’s tax account by the assessor). This interest is
assessed only on existing property; assessors are incapable of assessing property that does not
exist. Because Defendant assessed Plaintiffs’ home for the additional 44 percent completion
during 2019, their property tax increased more than three percent. The stipulated agreement
from the prior year did not calculate the MAV as having a complete structure, but instead as
having a partially completed structure. Indeed, Defendant would not be authorized to impose
taxes on property value that does not yet exist. Although Plaintiffs argue they would not have
agreed to the stipulation had they known their MAV would be readjusted the following year, the
adjustment was required as a matter of law due to new additions to the property.
B. Plaintiffs’ Burden of Proof
Plaintiff has the burden of proof, by preponderance of the evidence, of establishing that
the MAV of their property was incorrect. ORS 305.427. Neither party disputes that Plaintiffs’
construction was unfinished on January 1, 2019, nor do they dispute that the home was finished
by January 1, 2020.
At trial, Sexton testified that he evaluated Plaintiffs home as 56 percent complete on January
1, 2019. This was supported by photos of the home taken on the 2019 actual assessment date,
demonstrating Defendant knew the home was not a completed structure on January 1, 2019, and thus
would not have evaluated the property as if it contained a completed structure. In addition, Plaintiffs’
email negotiating the stipulated agreement contained the statement “your 56 percent completion,”
DECISION TC-MD 200396R 4 implying that Defendant and Plaintiff agreed to use the 56 percent figure. Nothing in the stipulated
agreement indicates the MAV and RMV used in the agreement represented a finished building, nor
does the agreement prevent yearly adjustments to the MAV and RMV to account for new
improvements made to the property. Plaintiffs may have made a unilateral mistake when assuming
the 56 percent was used for their occupancy instead of for the home’s level of completion.
Defendant’s assessment on January 1, 2019, was based on Plaintiffs’ structure being 56
percent complete. Because this property was finished by January 1, 2020, it was assessed as
complete for the 2020-21 tax year. The property is subject to adjustment of its MAV under ORS
308.153 for that year, rather than the three percent maximum increase under ORS 308.146.
III. CONCLUSION
The court finds that Plaintiffs’ property was 56 percent complete as of January 1, 2019.
Defendant correctly determined that Plaintiffs’ property was 100 percent complete as of January
1, 2020, thus requiring it to compute additional value to the MAV for the 2020-21 tax year.
Defendant’s adjusted 2020-21 assessment of the Plaintiffs’ property, as modified by BOPTA for
a slight error, was correct. Now, therefore,
IT IS THE DECISION OF THIS COURT that Plaintiffs’ appeal is denied.
Dated this____ day of November 2021.
RICHARD DAVIS MAGISTRATE
If you want to appeal this Decision, file a complaint in the Regular Division of the Oregon Tax Court, by mailing to: 1163 State Street, Salem, OR 97301-2563; or by hand delivery to: Fourth Floor, 1241 State Street, Salem, OR.
Your complaint must be submitted within 60 days after the date of this Decision or this Decision cannot be changed. TCR-MD 19 B.
DECISION TC-MD 200396R 5 Some appeal deadlines were extended in response to the Covid-19 emergency. Additional information is available at https://www.courts.oregon.gov/courts/tax
This document was signed by Magistrate Richard Davis and entered on November 23, 2021.
DECISION TC-MD 200396R 6