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<br /> February 12, 2020, Work Session – Item 1 <br /> <br />EUGENE CITY COUNCIL <br />AGENDA ITEM SUMMARY <br /> <br /> Work Session: Incentives for Accessory Dwelling Units Meeting Date: February 12, 2020 Agenda Item Number: 1 Department: Planning and Development Staff Contact: Anne Fifield <br />www.eugene-or.gov Contact Telephone Number: 541-682-5451 <br /> <br />ISSUE STATEMENT This work session will provide City Council information on incentives that could lower the cost of developing or owning an accessory dwelling units. <br />BACKGROUND Housing affordability and availability is a long-standing and growing problem in Eugene. In 2018, City Council directed staff to implement what became the Housing Tools and Strategies project, to identify potential tools and strategies available to the City to address housing affordability, availability and diversity for all income levels. That project included technical research and stakeholder input to identify a variety of actions the City could pursue to reduce costs and/or barriers to building more housing. In the Housing Tools and Strategies project, the City contracted with Strategic Economics to evaluate barriers to housing affordability, availability and diversity. Strategic Economics submitted a final report in January 2019, which stated that an effective ADU policy can contribute to achieving or maintaining affordability while accommodating growth. ADUs are a relatively low-cost housing type since there are no land costs and because they capitalize on existing infrastructure. In the September 16, 2019 Work Session regarding Accessory Dwelling Units, City Councilors asked staff to explore the creation of incentives that could reduce the cost of constructing ADUs. Council passed a motion that asked the City Manager to deliver a memorandum that addresses a 10-year property tax exemption, an SDC discount or credit, or other financial incentives identified by staff that could lower the cost of building ADUs. To identify and understand potential financial tools, staff reviewed analysis conducted during the Housing Tools and Strategies project and conducted additional research. We identified six different potential tools that could lower the cost of developing or owning an ADU in Eugene. The six potential tools include: A. Property tax exemption; B. Waive System Development Charges;