Item A: Joint Meeting with River Road Parks and Rec District

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Financial Impacts The City of Eugene has had an intergovernmental agreement with the River Road Park and Recreation District since 1983 to provide City funding to allow the continued use of RRPRD facilities and services for properties previously within the boundaries of the district but which have been annexed to the City. The idea behind the original agreement was that as existing residents annexed to the City, they could continue to use the services of the district. It was also expected that annexation of the entire district would occur within a 20-year time horizon and the entire district would be absorbed by the City. That did not occur within the period of the original 20-year agreement. The actual annexation history has been of undeveloped or underdeveloped properties--not existing residential properties. So residents occupying the new development are the primary beneficiaries of this agreement. Currently, City residents within this area have a higher level of service than other city residents since they can utilize RRPRD services as if they were in-district residents as well as participate in City services. No other City residents have this opportunity, including the much larger group of City residents in Santa Clara. There have been a number of changes in the state property tax laws in the past 20 years and the tax limitations are affecting both agencies. In 2003, the intergovernmental agreement was modified from a formula based on assessed value of annexed properties to a flat $100,000 per year payment. The district requested an increase to $200,000 beginning in FY09 so it can operate for a minimum of three years. The FY09 City of Eugene Budget continues the existing $100,000 payment for only one more year, with no further payments proposed. Generally, costs are rising faster than revenues and that has caused both the City of Eugene and the RRPRD to draw down reserves to maintain existing levels of service. The district currently has an assessed value of $407,895,219. The district has a permanent tax rate of $3.0559 and is expecting to receive $1,194,008in property taxes in the coming year. In five out of the last seven budget years, the district has not received a 3% property tax increase. This is due to annexations reducing the base number of properties. In addition, since nearly all new development occurs inside the City due to the Metro Plan policy, the district does not receive increases above the 3% allowed by Ballot Measure 50. As with the City, the district expenses have been increasing at a rate greater than 3% per year. The River Road Park and Recreation District 2008-09 Budget Message outlines the issues with their longer term financial outlook (see Attachment B). As a part of the River Road/Santa Clara Transition Project, the City contracted with ECONorthwest to perform a fiscal analysis of municipal services including Parks, Recreation and Cultural Services. One of the conclusions was that in 2004, River Road property owners were paying about $400 per year for parks and recreation services from the district while Eugene property owners were paying about $145 per year for the services being offered by the City (see Attachment C). An option that has been discussed with the district is to develop an intergovernmental agreement that calls for the transfer of staff from the district to the City and the district would use their property tax revenues to contract with the City for services to be provided to their residents. This would be similar to the agreement the City currently has with the River Road Water District whereby the City provides fire and emergency medical services for the district. Such an agreement would probably result in a move toward uniformity of fees between district and City residents and a potential reduction of service as the revenues to the district decrease. Z:\CMO\2008 Council Agendas\M080723\S080723A.doc