Item 1: Ordinance on MUPTE Boundary

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Public universities typically do not require adult students to live on campus and there are many students who live with parents, commute from nearby communities or are non-traditional (older, married, parents etc.). About one-fifth of NW Christian University students live in student housing. The current combined undergraduate and graduate enrollment at the University of Oregon is 20,394, of whom over 16,000 are undergraduate students. For planning purposes, the University is projecting modest increases over the next eight years with enrollment at 21,477 in 2016. Can a chart be provided that compares property taxes prior to an approved MUPTE, taxes collected after ten years, and shows how long it takes to recover the lost revenue? Response: Original tax data is not easily available for the older MUPTE projects. Others are not yet on the tax rolls. The following table provides information for the four most recent MUPTE developments that are now being fully taxed. The amount of revenue lost from removed improvements is provided in the third column. The ten- year total is based on the taxes on the removed improvements increasing by an estimated 34% over the ten years. An estimate is provided because actual predictions are difficult because of the peculiarities of Oregon’s property tax system created by Measure 47. APARTMENT ANNUAL REVENUE LOST TOTAL TAX AVERAGE CURRENT PROPERTY TAX ON REMOVED PAID (ON TAX PAID ANNUAL TAX PRIOR TO IMPROVEMENT LAND) ANNUALLY PAID ON LAND MUPTE (LAND IN YEAR ONE DURING DURING AND PLUS AND MUPTE MUPTE IMPROVEMENTS* IMPROVEMENTS) ESTIMATED 10 EXEMPTION YEAR TOTAL (YEAR) Paradice Apts. 3,376 (1995) 1,398/18,733 24,020 2,404 18,156 Burnell Ambrose 3,564 (1995) 3,084/41,425 8,114 811 5,463 Nozama Apts. 1,693 (1996) 135/1,809 19,065 1,905 10,959 Hilyard House 3,357 (1996) 1,769/23,704 19,240 1,923 31,320 *If one of these projects were constructed without the MUPTE the total tax exempted over ten years would be approximately ten times the amount in the last column. However, it can be assumed that they would not have been built at all, because the applicant had to financially demonstrate that the project wasn’t feasible “but for” the MUPTE. When was the current MUPTE boundary created, and has multi-family activity followed the boundary amendments? Response: The MUPTE boundary has changed numerous times since it was originally created. The current boundary was adopted in 2004. Multi-family development activity is most significantly impacted by economic factors which include the cost of land and construction, interest rates, and housing demand. To some extent the degree of construction is also impacted by opportunities in other locations. After the boundary was reduced to the heart of downtown in the late 1990’s, no multi-family construction Z:\CMO\2008 Council Agendas\M080721\S0807211.doc