Admin Order 58-11-01-F - Laserfiche WebLink

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component of planned public infrastructure projects that fully, or in part, will provide capacity for new growth anticipated in this community over a multi -year planning period. There are a couple of down -sides to the delay of periodic construction cost adjustments, one being that when the new rates are finally adopted they reflect a longer rate adjustment time period and result in higher spikes in actual adjustment rates when implemented than if they had been adjusted over shorter periods of time. The other down side is that the planned public infrastructure projects to be funded, fully or in part, by SDC revenues are delayed. The effective date of this administrative order has been delayed to June 1, 2011. This June I , 2011, effective date will correspond with the effective date of the reduction to parks SDC rates that City staff will be proposing to the City Council. If Council adopts the proposed park SDC rates reduction, that rate adjustment together with this administrative order's 3.5% rate increase will result in an overall reduction in the amount of SDCs currently collected for the average single -- family home. Specifically, if the Council approves City staff s recommendation to reduce the parks SDC with the June 1, 2011 effective date, the total SDCs collected for an average single- family home will be approximately -0.98% or - $88.15 less than is currently collected in SDCs. No changes are being made to the SDC rates as a result of this comment. Comment 4 : Gordon Anslow suggested that the SDC increases not go forward. He has been involved in the home building industry continuously since 1970. The current downturn in residential construction is not just another garden variety hiatus of work as with previous recessions. Since the 1950s, housing costs have been going up, as have new regulatory expenses affecting all aspects of homebuilding. The added costs have always been borne due to healthy demand and relatively high employment levels. Due to new rules, codes and expenses, housing that is affordable to working Americans can no longer be built. As a result, people remain in older, substandard housing, thus making older, substandard housing more valuable, and increasing the chance that it will not be replaced. If new construction becomes so expensive that little or no construction occurs, there will be no new work on which to charge SDCs, and the end result may be less money collected on SDCs than if the rates had not increased. He would like to see SDCs abolished so that affordable housing could be a reality again. However, at a minimum, SDCs should not increase at this time. Response City Council adopted growth management policy no. 14 states, "Development shall be required to pay the full cost of extending infrastructure." The only exception to this policy is an exemption from assessment of local SDCs for proposed housing for low - income persons that meets criteria outlined in Eugene Code 7.725(c). SDCs are an important funding component of planned public infrastructure projects that fully, or in part, will provide capacity for new growth anticipated in this community over a multi -year planning period to "build -out" of the current Eugene Urban Growth Boundary. Administrative Order -- Page 4 of 8