CCMinutes - 09/29/04 WS - Laserfiche WebLink

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Ms. Taylor commented that the City could not distinguish between desirable and undesirable businesses in an enterprise zone, using HMT as an example of an undesirable business that had no stability and low- paying jobs that did not fit the goal of financial stability. She questioned whether growth with all of its problems and needs should be encouraged. She preferred to concentrate on what businesses already existed in the community and what their needs for assistance with retention or further development might be, as well as what was compatible with what already existed. Mr. Kelly agreed that an enterprise zone could be a good economic development tool and enjoyed support in the community. He questioned whether the enterprise zone could be properly targeted so it benefited community residents. He expressed concern that the State statutes and administrative rules were so constraining that a local enterprise zone could not be defined to bring clear community benefit. He said he would support a zone if clear definitions could be developed. He described two hypothetical situations and asked if each was permissible under an enterprise zone: · an existing local company outside of the enterprise zone with 50 employees mostly earning $8-$9 per hour decided to build a larger plant on a vacant greenfield site within the zone and expand its workforce by 10 people, thereby qualifying for a 67 percent tax exemption on the new building even though it paid wages that were not livable in the community · a company in Idaho with 25 employees mostly earning $8-$9 per hour decided to relocate to Eugene and build a plant on a vacant site within the zone, thereby qualifying for a 67 percent tax exemption on the new facility even though the number of employees and wages would not change and many of the Idaho employees relocated with the business Mr. Braud agreed that both businesses would qualify for a tax exemption. Mr. Pap6 said the question for him was why the City would not apply for an enterprise zone when its previous program and zones in other communities were successful. He noted that 82 percent of the businesses that participated in Eugene's previous zone were still operating in the community. He said that an enterprise zone was a legitimate tool for economic development that served communities well. He asked why the committee had not recommended inclusion of more of the downtown area and whether the committee had suggested conditions for a five-year extended exemption. Mr. Braud replied that the types of companies that would qualify were primarily located in industrial areas and that was why downtown was not included. He indicated that time constraints prevented the committee from exploring conditions for the five- year extension. Mr. Pap6 asked for recommendations on conditions or qualifications for the extension if the council had another work session on the subject of an enterprise zone. Mr. Meisner remarked that while he had questions about the efficacy of enterprise zones he would likely support the motion to direct staff to return to the council with an application package. He said he did not understand why the City would undertake an enterprise zone program without proof of financial capability from businesses. He stated he objected to inclusion in the zone boundary of the triangle south of First Avenue, north of the railroad tracks, west of Jefferson Street, and east of Polk Street because it had been designated largely for mixed-use and was across the street from exclusively residential properties and was suspicious of the inclusion of specific parcels within the expanded boundary. Mr. Braud responded that the committee did not do a parcel-by-parcel analysis of boundary expansion; it included all industrial property that was adjacent to the old boundary. MINUTES--Eugene City Council September 29, 2004 Page 6 Work Session