Joe Angel is a real-estate developer and investor best known for once owning 28 Portland-area Burger Kings. Angel also helped develop three downtown hotels—the Westin, the deLuxe and the Lucia.

Today, he splits his time between his West Hills home, an Arch Cape beach house and Sisters, while managing his investments. He's a civic-minded Portlander who served on the Planning and Sustainability Commission and recently decorated a building he owns at the corner of Northeast Grand Avenue and Lloyd Boulevard with a wall-sized mural of the late street musician "Working" Kirk Reeves.

Angel, 71, also owns one of the largest private properties in Portland city limits, a stunning 46-acre, hilltop spread at the pinnacle of the West Hills on Northwest Skyline Boulevard. It's one-and-a-half times the size of Laurelhurst Park, and a lot less crowded. He bought the property in 1977 but has not lived there since 1980.

You might think Angel's estate incurs hefty property tax bills. In fact, he pays about $9,000 a year for the 2,600-square-foot house on the property and the parklike grounds surrounding it.

The tax break was intended for timber companies, farmers and ranchers.

But Angel, merely by claiming that someday he will cut his trees, gets an enormous discount on his property tax bill.

In a 2014 court case, Angel said that in nearly 40 years of owning the property, he'd "engaged in little active management of the timbered area of the subject property." Critics such as Jody Wiser of Tax Fairness Oregon say the standards for the tax deferrals for forests and small farms are too lax and that urbanites are gaming the system. "It's beyond a tax break," says Wiser, who has testified in Salem against expanding such deferrals. "Homeowners are getting subsidized so they can enjoy their own land."

Les Blaize, a Northwest Portland resident who grows tomatoes and sword ferns to qualify for a farm deferral on his 12 acres, disagrees. Blaize says forest and farm deferrals preserve green spaces that protect Forest Park and benefit the community.

"I'm sitting on six buildable lots here," Blaize says. "I could cut all my trees and sell my land for $1 million. That's not good for anyone."

Last year, more than 2,700 property owners in Multnomah County took advantage of those deferrals, pocketing nearly $5 million in deferred property taxes.

Multnomah County tax assessor Randy Walruff says he does not think the way property owners are benefiting from tax deferrals on high-value properties in the metro area meets the original legislative intent.

"We're talking about a law that was created to help Oregon's forest industry," Walruff says. "Now, the same exemption is being used for estate sites. I just don't see how the public benefits from that."

Walruff says forest and farm deferrals make even less fair a property tax system that already disproportionately rewards high-value property owners.

"They are taking breakfast out of low-income children's mouths," Walruff says.

Property tax breaks reduce funding for schools and the police and fire bureaus.

Yet it seems nobody in Salem wants to examine these loopholes. Even the tax-friendly Democrats who control the Legislature have shown no appetite for examining the farm and forest tax breaks.

"In my four sessions on the House Agriculture Committee, I don't recall there ever being a review of these programs," says state Rep. Brian Clem (D-Salem). "I think they are serving their purpose."

In fact, powerful lawmakers have pushed to make a generous program even more lucrative. In 2011, state Rep. Peter Buckley (D-Ashland), co-chairman of the budget-writing Joint Ways and Means Committee, pushed unsuccessfully to lower the already minuscule minimum income requirement for a small farm tax deferral.

And House Speaker Tina Kotek (D-Northeast Portland) was the chief sponsor of a 2009 bill that provided a multimillion-dollar property tax bailout to just one constituent—a farmer who'd seen his tax deferral canceled (see sidebar, below).

Currently, lawmakers led by state Sen. Betsy Johnson (D-Scappoose) are seeking an expansion of such loopholes, pushing legislation that would generate retroactive new tax deferrals for wildlife habitat.

"If we are not going to make sure that people with existing tax deferrals are actually doing something that benefits the public," Wiser says, "we shouldn't be passing new laws that help more people avoid paying taxes."

Anyone who has driven through the Cascades knows what a forest looks like. But forests look different to legislators, who allow property owners with only 2 acres of trees to qualify for a tax deferral.

Originally, lawmakers created forest and farm deferrals to promote the timber industry and food production. As a result, farmers and foresters pay greatly reduced property taxes—in the range of 10 or 20 percent of what they'd otherwise pay. That costs local tax authorities across Oregon nearly $250 million a year, according to state figures.

The tax deferrals may make sense for large farm and timber operations. It's less clear what they do for the hobby farms and small forests that dot the metro area.

A good example is the home owned by Loran and Erena Friedrich, who live on 4 acres in Northwest Portland. The Friedrichs have a forest deferral for 3 of their 4 acres. The Friedrichs are not timber people. Erena Friedrich says she and her husband moved from Hillsboro to rural Portland in 2005 seeking more green space. She says the forest deferral on the Portland property they purchased was not a big consideration.

"Our taxes would be higher," she says. "It's handy to have the deferral."

One indication that property owners are serious about forestry is having a forest-management plan with a schedule for harvest, removal of invasive species, etc.

Erena Friedrich says she and her husband have no forest-management plan, nor have they given any thought to harvesting trees.

"It's just woods," she says. "There is a game trail through it. We've seen coyotes come through. One morning I woke up and the entire yard was covered with elk."

Calculations done by the county assessor's office show the Friedrichs have saved over $7,000 on their property taxes in the past five years.

Critics of the farm and forest deferrals say the tax breaks often provide a cushion for wealthy Oregonians who like to surround themselves with big pieces of property.

"There's absolutely no doubt there are people who are doing minimal farming or planting the minimum amount of trees to lower their tax bill," says Tom Linhares, former supervisor of the Multnomah County Tax Supervising and Conservation Commission and the current Wasco County assessor.

There are few better examples than two parcels of property on Northwest Saltzman Road totaling nearly 73 acres that belong to Dick and Mary Jaffe.

Their farmhouse, an 11,000-square-foot Victorian built in 1996, sits next to a 4,000-square-foot barn and a 1,200-square-foot garage.

The Jaffes paid $3.5 million for their property in 2008. They have no recorded mortgage.

Of their property, 31 acres get a farmland tax deferral, some for trees and some for rangeland for alpacas that Mary Jaffe raises. Her company, Skyline Alpacas, breeds and sells the woolly animals. A website offers financing for buyers and volume discounts on pregnant females. "Brighten up your January with some NEW alpacas," Mary Jaffe's website says. "Due to our commitment to quality care, and the fact that we have run out of room, we have reduced our prices on most animals."

Part of the reason she can afford to be generous may be the property tax savings she and her husband enjoy—more than $30,000 over the past five years.

A tax deferral is remarkably easy to obtain for small farmers.

State law requires that for farmers to qualify, they have to gross $100 an acre. If they farm less than 6.5 acres, they must earn $650 in gross—not net—income in three out of every five years.

That threshold has not changed in decades and would be more than $3,500 today if adjusted for inflation.

The $650 threshold doesn't require that small farmers actually sell that much product. Under state law, they can consume 49 percent of the food or other products they grow or raise to meet the requirement. That means people who grow tomatoes, herbs or flowers in effect get a tax break to have a garden.

Tax Fairness Oregon's Wiser pointed out to lawmakers at a 2011 hearing on farm deferrals that she could obtain a farm deferral by harvesting the trillium that grows wild on her land and selling it at farmers markets.

Wiser also says the farm deferral's cost is even greater because it also allows hobby farmers to write off their vehicles and other equipment.

"We're subsidizing people having trucks who don't need trucks," she says.

Walruff, the Multnomah County tax assessor, is an intense fellow who speaks in staccato bursts. After more than 30 years working for the county, he looks like he could still compete with the Clackamas High School cross-country runners he coaches in his spare time.

In 2011, Walruff got an increase in staff and a better computer system. One of the first things he did was start cracking down on deferrals he considered questionable.

Walruff noticed there was a conflict between city conservation zoning overlays and forest deferrals. In June 2011, he canceled the deferrals on more than 50 properties in environmental zones, reasoning that the zoning made it virtually impossible to cut trees and therefore illogical to grant forest deferrals.

"When we look at exemptions or deferrals, we ask, 'Do they meet the intent of the law?'" Walruff says. "If you're in doubt, you cancel. That's the advice we've gotten from our lawyers."

Most of the 2011 cancellation notices went to property owners in Northwest Portland adjacent to or near Forest Park.

Robert Hodel, who lives on a heavily wooded 10.15-acre parcel next to Forest Park, received one of those cancellation notices. You'd need a helicopter to find Hodel's 2,885-square-foot home.

When the county canceled Hodel's forest deferral, he immediately applied for a farm deferral.

A representative of the county assessor's office visited Hodel's property and "found no evidence of commercial farming activity." The county rejected Hodel's application and asked him for five years of back taxes.

Hodel took the county to Oregon Tax Court in 2012, however, and won—because the judge ruled that under Oregon law, he has five years to establish himself as a farmer. (Hodel declined to comment.)

The tax court ruling saved Hodel nearly $18,000 over five years.

Walruff says the court's decision was hard to accept. "I wasn't very happy," he says. "I just don't believe those types of uses meet the intent of the law."

Joe Angel fared even better than Hodel.

Walruff also canceled Angel's forest tax deferral in June 2011, and Angel also went to tax court. In Angel's initial case, the magistrate judge upheld the county's cancellation, noting that Angel had twice filed documents indicating interest in developing his land. The judge also bought the county's argument that Angel was unable to harvest his timber because of the city's conservation overlay.

"Plaintiff's overt actions reveal an intention to hold and use the property in the manner that generates the greatest financial gain," Magistrate Dan Robinson ruled Aug. 20, 2012. "Coupled with the conservation overlay, plaintiff's actions suggest that the subject property was not being held or used for the predominant purpose of growing and harvesting trees."

But in 2014, Angel appealed his initial loss to the higher level of the Oregon Tax Court—and won.

Angel acknowledged he had done little in the way of planting or harvesting trees or eliminating invasive species. Nor had he filed a forest-management plan. Instead, he told the court, he'd "informally sought management advice from social acquaintances involved in the timber industry."

And the judge rejected the county's claim that the conservation easement blocked Angel from someday cutting trees.

"Taxpayer's 'predominant purpose' for holding the subject property is a question of the taxpayer's state of mind," wrote Tax Court Judge Henry Breithaupt on July 24, 2014.

In other words, if Angel thought he deserved a tax deferral, he deserved a tax deferral.

Angel declined to answer questions about the specifics of his case. He does acknowledge it might be time for the Legislature to review the deferral program.

"The question on the forest and farm tax deferral programs is, 'Have the public policies worked?'" Angel says. "If they've gotten out of whack, let's have a debate about that."

Tina's Favorite Farm

Tucked between the Columbia Slough and a new FedEx terminal in Northeast Portland's industrial heartland lies a valuable piece of real estate owned by the Fazio family, Portland farmers for nearly a century.

For years, the Fazios grew cucumbers on the land, but today there is a mat of green fuzz, the leavings of transient geese—and a rock-crushing operation that produces gravel piled to the sky.

How valuable is the Fazio land? An adjacent property, now a 47-acre FedEx shipping facility, provides a useful comparison. The FedEx land—not the improvements on it—has an assessed value of $12.6 million.

The Fazio property, which at 36 acres is a little smaller, is assessed at tiny fraction of that amount—$67,000.

What accounts for the extraordinary difference in valuation? Two things: a tax deferral for farm use on the Fazio land and, more important, a friendly and powerful lawmaker.

Six years ago, state Rep. Tina Kotek (D-Northeast Portland) was in her second term as a legislator but already destined for big things.

On March 26, 2009, Kotek testified in front of the House Committee on Agriculture, Natural Resources and Rural Communities. "It's not often that an urban legislator like myself comes and talks to you about farming," she said.

Kotek was the chief sponsor of the bill she came to present—a bill she introduced at the request of Anthony Fazio of Fazio Farms.

Fazio had a problem, Kotek told the committee: His land near the slough was riddled with fungus. That made the ground unusable. The Fazios had stopped farming the land in 1999 and began filling it with clean dirt.

In 2007, the Multnomah County tax assessor's office canceled the Fazio's farm tax deferral after learning the property was operating as an industrial landfill and rock-crushing operation. In fact, records show Anthony Fazio established Fazio Landfill & Recycling on the property in October 2002, so the cancellation of the farmland tax deferral could have come much earlier.

For Fazio, though, the cancellation was a triple whammy: It meant an immediate property tax increase of about $80,000 per year and it gave the county authority to collect five years of deferred taxes, totaling about $400,000. The county also levied personal property tax on the rock crushers, elevators and other equipment used in the landfill operation, which would cost Fazio another $17,000 a year.

Media reports were sympathetic. WW joined the chorus of Fazio advocates in 2008, naming the Multnomah County assessor's office "Rogue of the Week" for squeezing one of Portland's last farms.

Kotek sponsored a 2009 bill that would allow properties in "remediation" to hold onto their tax deferral until the land was again ready to support crops.

The bill zipped through both chambers unanimously. House Agriculture Committee Chairman Brian Clem (D-Salem) called its passage "a real David and Goliath story."

Randy Walruff, the Multnomah County tax assessor, opposed Kotek's bill, and he doesn't like it any better today. He says he is not aware of any other landowners who benefited from Kotek's bill, and notes the legislation placed no time limit on how long farmland in "remediation" could lie fallow.

"Anyone else running a landfill on their property has to pay taxes on land in industrial use and pay personal property tax on the equipment," Walruff says. "Anyone except the Fazios."

Today, the Fazio property still gets a farm deferral, but it doesn't look much like a farm. Mounds of crushed rock 30 feet high tower over the fallow soil, and well-used rock-crushing machinery and earthmovers sit amid hulking piles of scrapped pavement and concrete waiting to be processed.

Walruff's staff calculates Kotek's bill has saved the Fazios $722,000 in taxes deferred since 2007, and another $100,000 on the otherwise taxable machinery used for "remediation."

Kotek says she usually opposes bills of narrow benefit, but she found the Fazios persuasive. "They were salt-of-the-earth guys," she says.

Kotek never received a campaign contribution from Fazio. She says restoring Fazio's farm deferral was legitimate but adds that all tax breaks should be reviewed regularly.

Anthony Fazio says he got into the landfill business to acquire cheap dirt to raise the level of his land and cover up fungus-ridden soil. He'd like to close his landfill.

"It's a horrible business," Fazio says. "I hate it. I don't want to be in it."

He says the county initially approved his plan to remediate his soil, then canceled his deferral. He says that was unfair. 

"They let me go down a path and then fattened me up like a turkey until they needed me for Thanksgiving," he says.

Fazio admits that fixing the soil has taken far longer than he ever imagined.

"At first I thought it was going to be a year," he says. "That's what I told them."

It's been 16 years, and trucks full of rubble are still arriving at a property that enjoys a vast tax break.

"That's very valuable industrial land being kept in farm use," Walruff says. "For them, that's a very good deal." –NIGEL JAQUISS.

Clarification appended: The original version of this story failed to make clear that Dick and Mary Jaffee own two separate parcels of land bought at different times.