Item 2D: Resolution Approving Extension of Historic Tax Benefits

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Adoption of Resolution 4873 Authorizing a Second Term of Historic Property Classification and Special Assessment for Residential Property Pursuant to HB 2776 (2005 OR Laws CH 549) Meeting Date: May 22, 2006 Agenda Item Number: 2D Department: Planning and Development Staff Contact: Ken Guzowski www.ci.eugene.or.us Contact Telephone Number: 682-5562 ISSUE STATEMENT In order for owners of residential properties listed in the National Register of Historic Places to apply for a second 15-year enrollment in the Oregon Special Assessment Program, the City Council must adopt the attached resolution. Participation in this program is voluntary, so the property owner takes responsibility for submitting his or her Special Assessment application directly to the Oregon State Historic Preservation Office (SHPO). The Special Assessment Program is administered by the Oregon SHPO, which resolves all compliance issues directly with the owner. Once the application is approved, the Special Assessment Program allows the property taxes to be frozen at their current assessed value for a second 15-year period, with the agreement that the owner will use the tax savings to appropriately rehabilitate the historic property. BACKGROUND The City Council has not been involved in the Oregon Special Assessment Program in the past. Both residential and commercial properties have the ability to enroll in this program. Commercial properties enrolled in the Oregon Special Assessment Program have been able to enroll in a second 15-year tax freeze since 1995. HB 2776 helps to level the playing field for residential properties, so that all properties listed in the National Register can apply for a second 15-year tax freeze in Oregon. The Oregon SHPO works directly with applicants to develop their preservation plan and to ensure compliance and timeliness. The legislative content of HB 2776 makes residential property eligible for a second 15-year period, provided the local government adopts a resolution authorizing a second term on a jurisdictional basis, not on a building-by-building basis. Currently, there are 25 historic properties in Eugene that are enrolled in Oregon’s Special Assessment Program. Two of the commercial properties are in the process of applying for a second 15-year enrollment. Of these 25 properties, 15 are residential in use, and the remaining 10 are commercial in use. Financial implications to the City’s Permanent Tax Levy are small, at an estimated average savings of about $400/year or $6,000 over 15 years for each property enrolled in the program. The General Fund will lose about $90,000 in total tax revenues for these 15 properties. The assessor will reassess the property at a percentage of its real value at the time the owner chooses to enroll a second time. Five letters of support are attached to this Agenda Item Summary including the recommendation of Eugene’s Historic Review Board, which deliberated on this item at its March 30, 2006, meeting. L:\CMO\2006 Council Agendas\M060522\S0605222D.doc