The Department of Revenue’s ruling on Happy Valley
On Tuesday, June 19, the Oregon Department of Revenue (DOR) ruled that the City of Happy Valley did not follow appropriate state law in withdrawing from the North Clackamas Parks and Recreation District (NCPRD).
The ruling invalidates the previous boundary change, meaning that Happy Valley remains part of NCPRD.
More information about this action can be found here.
NCPRD was surprised by this ruling. Staff had completed many actions and tasks associated with the assumed withdrawal. We understand this process has been confusing, and our staff is committed to making this process as clear and easy as possible.
When did the City of Happy Valley decide to leave the District?
In June 2017, Happy Valley City Council voted to withdraw from NCPRD effective December 31, 2017. The City cited its desire to provide parks and recreation services to city residents directly.
Although NCPRD worked in good faith to negotiate an equitable division of assets, the City filed a lawsuit against the District in October 2017. The City’s complaint sought a disproportionate share of the District’s assets and substantial cash demands. There are 78.7 acres of park lands in Happy Valley that were developed using NCPRD revenue, not including Hood View Park, that are used heavily by the City’s residents.
Last November, Clackamas County filed a counterclaim citing numerous examples of misleading claims by the City.
The State of Oregon’s Department of Revenue has found that the City of Happy Valley’s withdrawal from NCPRD is not compliant with state law and Happy Valley remains within NCPRD’s boundaries. This ruling means that Happy Valley residents remain in the District boundaries until the City completes the withdrawal process.
The statute that governs boundary changes for special service districts, ORS Chapter 198, establishes a process for withdrawal which would, in this case, require approval of Clackamas County Commissioners and potentially a vote of residents of the district.
Are residents of Happy Valley now considered “out-of-district”?
No. Happy Valley residents will remain within the District boundaries receiving the same services and benefits as they have been, and will continue to pay the NCPRD assessment until such time that the City’s withdrawal is legally formalized.
What does this mean for Happy Valley residents who are interested in registering for programs?
Happy Valley residents are eligible to register for programs with the same in-district fees they currently benefit from.
The online registration system has been upgraded to make signing up for recreational programs and classes easier than ever. Get information on setting up a new account here.
What does this mean for Happy Valley residents who have already registered for summer programs using out-of-district fees?
Happy Valley residents were only charged out-of-district rates for programs starting after July 1, 2018.
If you live in Happy Valley and have already registered for summer activities paying the out-of-district rates, you will receive a refund for the difference between the two rates. We will be contacting all Happy Valley residents who have registered with more information.
Will Happy Valley residents continue to pay taxes to NCPRD?
Yes. As of now, this ruling means that NCPRD will continue assessing Happy Valley residents. We have received another letter from the DOR, dated June 21, specifying that the NCPRD tax should be collected within Happy Valley. That letter is available here.
Happy Valley residents will remain within the District boundaries and will continue to receive the same benefits and access to recreational programs as they have been. The assessment will be in place until the city has legally completed the withdrawal process
Will Happy Valley residents be required to pay taxes to both the City and County for parks services?
Whether the City of Happy Valley wants to also impose its recent voter approved levy is a decision for the City. For questions about the recent voter approved levy, please contact the City of Happy Valley.
NCPRD will continue to assess the permanent tax rate within the City of Happy Valley, as specified by the DOR.
Where can I go for more information?