Item 4 - Ordinance on Downtown Urban Renewal Plan Amendments

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The estimated amount of urban renewal taxes to be divided over the remaining term of the Renewal Plan (net of discounts, delinquents, etc.) is shown in Table 7. Only the perm- anent tax rates of the overlapping jurisdictions are considered in this analysis because there are no local option levies included in urban renewal revenues for the Downtown Urban Renewal District, and bonded debt tax rates will be reduced from year to year until the existing bonds are paid off. As can be seen, in FY2007/2008, it is estimated that the City of Eugene would forego about $840,000 of revenue because of the Downtown Urban Renewal District. In FY2029/2030, when the district is terminated, the City of Eugene is estimated to receive $2.2 million of additional tax revenue. Lane County is estimated to forego $150,000 of revenue in the first fiscal year, and to benefit by $400,000 of additional tax revenue when the district is terminated in FY2029/2030. The combined school districts are estimated to forego $670,000 of revenue in the first fiscal year, and to benefit by $1.8 million of addi- tional tax revenue when the district is terminated in FY2029/2030. As mentioned above, however, the impact on schools is really an impact on the state’s budget because schools are mainly funded on a per-pupil funding formula rather than by the level of property tax dollars generated within their boundaries. This analysis does not take into account the effect of terminating the urban renewal district on any local option levy that the schools might have outstanding in FY2029/2030. Because the Downtown District Urban Renewal Plan took steps to be “grandfathered” under the provisions of Measure 50, the district is allowed to levy a higher amount of taxes than would otherwise be allowed for the existing life of the district. The base amount allowed to be levied is the “division of tax” levy, which is equal to the incremental property value in the district times the overlapping tax rate for all jurisdictions (City, County, schools, bonds). In addition, the “grandfather” provision allows the Downtown District Urban Renewal District to levy a “special levy” in order to protect the level of property tax collec- tions after implementation of the provisions of Measure 50. In FY2006/2007, the special levy tax rate was $0.1888/$1000 of AV and the “division of tax” levy was $0.1936, for a total of $0.3824/$1000 of AV. When the district has collected sufficient revenues to fund the current $33 million of projects included under the existing maximum indebtedness cap, the district will no longer qualify for the special levy and taxes will go down for Eugene taxpayers which is anticipated to occur not later than FY2008/2009. Table 7 on the following page provides details of the impact of carrying out the 2007 Amendment to the Plan. Report on the Downtown Urban Renewal District Plan – Circulation Draft of July 17, 2007 17