Item 1: Ordinance on Downtown Urban Renewal Amendment

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Public Hearing: Ordinance Adopting an Amended Urban Renewal Plan for the Downtown Urban Renewal District Meeting Date: April 19, 2010 Agenda Item Number: 1 Department: Planning & Development Staff Contact: Amanda Nobel Flannery www.eugene-or.gov Contact Telephone Number: 541-682-5535 ISSUE STATEMENT The public is invited to comment on a proposed ordinance to amend the Central Eugene Project (Downtown) Urban Renewal Plan. On March 8, 2010, the Urban Renewal Agency (URA) Board initiated amendments that include increasing the maximum indebtedness by $16.15 million to a total of $49.15 million, expanding the boundary to include the potential Veterans Affairs (VA) clinic site, and terminating the Downtown District as soon as sufficient funds are collected to pay for the package of projects (Lane Community College’s new downtown campus, public safety improvements and increased police staffing, VA Willamette Street Clinic, and Park Blocks improvements for the Farmers’ Market.) BACKGROUND On March 8, 2010, the URA Board of Directors initiated a process to amend the Downtown Urban Renewal Plan as a funding option for the package of downtown projects. The proposed amendments would 1) increase the maximum indebtedness (spending limit) to cover the four specific projects, 2) expand the District boundary to be able to provide assistance for the VA project, and 3) terminate the Downtown District as soon as sufficient funds are collected to pay for those projects. (See Attachment A for a summary of council discussions and actions and public involvement over the past year.) School District 4J Also on March 8, the URA Board requested the City Manager complete analysis of the financial impact on School District 4J from the Downtown District continuing to collect property tax revenue and, should there be a financial impact, to come back with ways to keep 4J whole, either through the exchange of services or through financial help. The analysis concludes that 4J is better off financially if the Downtown District continues to collect tax increment funds than it would be if tax increment financing were terminated. The net benefit to 4J is about $117,000 annually from having the Downtown District in place. Alternatively, 4J would lose about $117,000 annually and gain a one-time payment of $30,000, if the Downtown Urban Renewal District were terminated. An explanation of the three impacts to 4J from Downtown Urban Renewal District tax increment collections are: 1.On-going Operating Funds = on-going gain of <$20,000 if the Downtown District were terminated: The State determines operating budgets for each school district based on the number of pupils. If the money is not available from local property taxes, the State will make up the difference. In FY10, the Downtown District diverted $550,000 of local property taxes that Z:\CMO\2010 Council Agendas\M100419\S1004191.doc