Item B: MUPTE Boundary and Selection Criteria

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MUPTE Guidelines The current MUPTE application packet is provided as Attachment A. This includes the adopted local standards. Public benefits are at the core of the program. Applicants must currently respond to a list of public benefits including sustainability features, responsiveness to adjacent historic resources, building material quality, design elements, Americans with Disabilities Act (ADA) accessible units, home ownership and solicitation of neighborhood association comments. The guidelines include specific rules for protection of historic or potentially historic buildings. Local Market Conditions and Activity The local rental housing market is tight. The low vacancy rate (less than 2% in Eugene and near 0% in the core area), has tended to push rent increases at rates in excess of wage growth. Yet, because of increases in land and construction costs, local rental rates still appear to be insufficient to support new construction of quality infill rental housing in most neighborhoods. West University has recently become an exception in some cases because there is a tolerance for higher rents. However, because rental income is the determining factor for land costs in higher density residential zones, the land costs have been increasing. The non- MUPTE developments have occurred when the land was purchased at much lower than the current market rate of $60.00 per square foot. TIMING The program is operating under existing guidelines that remain in place until changed by ordinance. RELATED CITY POLICIES Policy Issues and Council Goals The key policy issues are whether the City wishes to provide a tax exemption as a tool that encourages construction of housing in the core area and if so, whether the rules or guidelines should be revised. Encouraging housing, and higher densities in the core area and in surrounding neighborhoods is consistent with numerous adopted planning and policy documents. Examples include: Growth Management Policies Policy 1 Support the existing Eugene Urban Growth Boundary by taking actions to increase density and use on existing vacant land and under-used land within the boundary more efficiently. Policy 2 Encourage in-fill, mixed-use, redevelopment, and higher density development. Policy 3 Encourage a mix of businesses and residential uses downtown using incentives and zoning. Downtown Plan: Living Downtown Policy 1 Stimulate multi-unit housing in the downtown core and on the edges of downtown for a variety of income levels and ownership opportunities. Policy 2 Reinforce residential use in neighborhoods abutting the downtown commercial core to help contain commercial activity in downtown and maintain the historic character and livability of adjacent neighborhoods. Downtown Plan Implementation Strategies A. Expand the MUPTE program boundary to encourage housing on the edges of downtown. Periodically review boundaries and expand to include areas where additional housing is appropriate. F. Seek opportunities to equalize the costs of building housing in and near downtown compared with locations elsewhere in the city. Y:\CMO\2008 Council Agendas\M080527\S080527B.doc