CC Minutes - 05/27/08 Work Session

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disappeared because land had been provided for a homeless shelter and a trailer park had been closed because of negligent care of the trailers. Mr. Weinman explained the Housing Dispersal Policy that applied to family housing. Land bank sites were not being purchased nor were subsidies currently provided for family housing in areas that were already 50 percent low-income. Much of the area in Ms. Ortiz’ proposal was already at the 50 percent level and new subsidized housing had not been pursued in that area.. A 20-year low income tax exemption is available. However, the economics of subsidized and low-income housing is that it takes more than tax exemptions to achieve that goal. With the 10- year MUPTE tax exemption, some low-income housing may be built if rents are high enough, but it is difficult to achieve in most neighborhoods. There is currently a low vacancy rate in Eugene which makes it difficult for low-income people to compete for the limited commodity. Ms. Bettman distributed two maps provided by Mr. Weinman, illustrating the Proposed MUPTE Boundary Expansion/Downtown Plan Area (blue map) and Proposed MUPTE Boundary Expansion/Old MUPTE Boundary (yellow map) areas. She said the MUPTE program was predicated on the assumption that properties would not otherwise be developed. Market factors and variables in the West University Neighborhood (WUN) impact development. Ms. Bettman said there was development in that neighborhood, as reported by an article in that day’s Register Guard, noting there were 900 University of Oregon (UO) freshman who did not have campus housing, in addition to other undergraduate and graduate students. The pressure of those housing needs was placed on the community. The City should not forego tax revenue where the market supported housing construction, but the playing field should be leveled where code barriers made construction challenging. Everyone should pay their share of taxes. Ms. Taylor said there was a big demand for housing in the university neighborhood and it would be built with or without a tax break. Everyone should pay taxes. She preferred going back to the pre-2004 MUPTE boundary because there was a benefit to filling the empty space downtown, and she was not willing to expand the boundary. Mr. Clark was challenged with the pre-2004 boundary that came away from the Eugene Water and Electric Board (EWEB) property as illustrated on the map, and created a disincentive for anything that might occur regarding a dense core around what might one day be built on the EWEB property, taking an option off the property. He considered the 900 incoming UO freshmen to be new members of the community who needed to be served with the appropriate housing choice, whether on or off campus, and did not consider them to be a cost of the university. He asked what the functional impact of ending MUPTE around the university would be. Based on his conversations with real estate professionals, Mr. Weinman believed there would be less construction. He understood that some of the projects were built without MUPTE because of the but for requirement, because developers had owned the land for a long time or had paid a below market rate for the land. With the current value of land at $60 to $80 per square foot, housing construction was no longer viable without the economic incentive. Some people had purchased properties with the intention of building knowing the MUPTE incentive was available. This knowledge of construction costs is supported by staff analysis of proposals for low-income housing. MINUTES—Eugene City Council May 27, 2008 Page 5 Work Session