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Oregon House Bill 4111 - Foreclosure Reform Bill
New Law Relating to Local Improvement District Liens Passes Oregon Legislature
Bill Now Awaits the Governor's Signature
by Scott Rohter April 2012
House Bill 4111 is the culmination of my fifteen year long struggle to correct a terrible injustice that was committed in the name of all Oregonians to two Lane County senior citizens, Jack and Betty Neely of Eugene. They were 77 years old and 66 years old respectively when their home was foreclosed on by the City of Eugene and sold for the exact amount of an unpaid sewer lien. These two Oregon senior citizens stood opposed to the juggernaut of urban development and the annexation of the unincorporated areas of River Road and Santa Clara which are just north and west of Eugene. Their home at 1600 Horn Lane was directly in the path of Eugene’s urban growth boundary. Jack and Betty Neely were all that stood in the way of Eugene's continued expansion into these areas. Their family home was foreclosed on and sold for just $7,411 after a long legal battle with the City which the Neely’s eventually lost. Then their home which had been appraised at nearly $70,000 was expropriated by the City and sold for the exact amount of the unpaid sewer lien, which by the way the Neely's never even wanted, in order to scare the rest of the residents of River Road and Santa Clare into nearly full compliance with the City's illegal ordinance. It also helped to achieve an 80% hookup rate to the Eugene Municipal Wastewater Treatment Facility and bring in much needed revenue to pay back the Federal government for the money that the City of Eugene had borrowed in order to build these sewer lines. In other words the City of Eugene made an example out of the Neelys, and it cost Jack his life. This occurred in 1995.
Jack and Betty Neely paid dearly for their principles, and they paid dearly for standing up to Eugene’s over aggressive land use planning goals. Their refusal to pay the original sewer assessment fee of $5000 which the City levied on them (It was later determined by the Oregon Appeals Court that this fee was illegal) cost Jack Neely his home and his life. The Neely’s were assesed $2,411 worth of of fines leaving them with a questionable debt of $7,411. Actually because the Neelys lost their house they really paid over $70,000 worth of fines, and Jack Neely wound up by paying for what he believed in with his life. He died of a heart attack one month after being evicted from his house by the Lane County Sheriff. That was after a five year long legal battle that left both he and his sister discouraged. It also left them basically penniless and homeless. He was staying with a friend at the time of his death. Jack Neely died of a broken heart that was precipitated by his long and unsuccessful legal battle with the City of Eugene. He was disillusioned, and beaten down at the time of his death. That’s what the autopsy report did not say.
I wrote Oregon House Bill 3453 back in 1995. It was gutted and passed that year by the House, but then it was allowed to die in the Oregon Senate. I tried unsuccessfully to bring the Bill back in 2010 and 2011. In 2010 it was referred to as Senate Bill 929. It didn’t even receive a hearing that year thanks to the "do-nothing" Democrat that represents my district in the Oregon Senate. I don't know why for the last 15 years that no one else in this State ever thought enough to do something about this matter, and that no one in the State Legislature ever brought this Bill forward again. Eugene Mayor Kitty Piercy sponsored the original House Bill back in 1995 when she just a newly elected representative from the district that Jack and Betty Neely lived in, but she did nothing at all during the rest of her long legislative career to correct this injustice. She did not bring the bill forward again during the next five years that she served in the Oregon State Legislature. She went on to became the Democrat Caucus leader and eventually in her last term she became the House Minority leader. Did someone need to remind her of the importance of correcting the injustice that was done to the Neely family?
How on earth did the law which allowed the Neely home to be sold for the exact amount of a sewer lien ever get written in the first place? I'd like to know. And what the heck is wrong with the League of Oregon Cities who stood opposed to a small change in the language of the Bill this year that would have made it even better? Oregon House Bill 4111 simply seeks to restore justice to cold hearted law and order for all Oregonians, who for whatever reason might find themselves in the same situation as the Neelys one day, with a local improvement district lien on their property that they just cannot pay. The Oregon law that my Bill reforms is ORS 223.525. This State law simply ignored the United States Constitution and The Bill of Rights. It violated three of our first ten Amendments.
It violated the 4th Amendment which guarantees to all Americans the right to be secure in our houses against unreasonable seizures. It violated the 5th Amendment which requires that private property which is taken for a public use (such as satisfying a municipal sewer lien) cannot be taken without just compensation. And it violated the 8th Amendment which prohibits the imposition of excessive fines, and cruel and unusual punishment. When did it become acceptable in Oregon or anywhere else in the United States for that matter to sell someone’s house for the exact amount of an unpaid sewer lien (which by the way was later determined to be illegal by the Oregon Court of Appeals), and to effectively turn a couple of independent, taxpaying Oregon Senior Citizens into homeless people who are dependent upon the State for government assistance? After the Neelys lost their home, in a subsequent lawsuit the Oregon Appeals Court ruled (in The City of Eugene v. Nalven) that the City of Eugene was wrong in forcing someone who lived outside of the City limits of Eugene to hook up to the Eugene Municipal Sewer System. The City of Eugene was dead wrong, and Jack Neely was dead. He lost his life due to their illegal behavior, and it’s about time that the City of Eugene offer an official apologize to the surviving members of the Neely family and make the proper restitution.
In Salem last week House Bill 4111 passed the Oregon Legislature, but someone in a legislative work-up session inserted some incorrect language into the Bill, a defect which will turn back the hands of justice ever so slightly by substituting the words 75% of total assessed value , for the words 75% of real market value , which will slightly minimize the impact of the Bill.
There is often a substantial difference between real market value and total assessed value. It is not clear who actually inserted the words total assessed value into the Bill, or at whose request it was put there, but the League of Oregon Cities, opposed my request to substitute the words [real market value] for the current language in the Bill [total assessed value]. What possible good reason could they have for opposing this small correction?
I have received assurances from Dave Hunnicut of Oregonians in Action that during the next session of the Oregon Legislature they can revisit this issue and correct the defect in the current language of the Bill. Nevertheless it is still a great moral victory for all Oregonians of good conscience, and a huge improvement over what the old law was.
"A journalist has no better friend than the truth." - Scott Rohter