09/30/1987 Meeting - Laserfiche WebLink

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Ms. Wooten said that while the legal question may be an important issue in its own right, she was not sure that it was relevant to the council's e consideration of the updated Urban Renewal Plan. Mr. Bennett said the most important questions are: Should the downtown occupy a unique and important place in the community on a continuing basis, and should special development tools be available for downtown? He said councilors need to address this fundamental question before getting bogged down with specific legal questions about tax increment financing. Mr. Bennett said his answer to the fundamental question was that downtown does occupy a special place and that it is worthy of special consideration. The question, therefore, that he would ask the City Attorneys is: How can the City position itself so that it will be able to use tax increment (or some other type of financing) for the development of downtown? Mayor Obie asked Mr. Sercombe to have the City Attorney's Office deliver an opinion on the issue raised by Mr. Holmer. In response to a question later in the meeting, Mr. Byrne said the loan program spends about $50,000 of the annual $1.9 million tax increment revenues. F. Tax Increment and the Overall Tax Rate, Continued Mayor Obie said that although the downtown occupies a special place in the community, the use of tax increment financing is costing taxpayers 68 cents per $1,000 of assessed value. He said this must be weighed against other community priorities and values. e Ms. Wooten said that if the use of tax increment financing were stopped, all of the 68 cents per $1,000 of assessed value would not return to the General Fund budget. Mr. Gleason said none of it would; rather, the overall tax rate would be lower. Mr. Bennett said tax increment financing (or a tool like it) is so important because it does not generate the tax until development occurs; this makes the use of tax increment funds much more accountable. He said that i f tax increment had not been used and if no development had occurred downtown, no one would have received the 68 cents per $1,000 of assessed value anyway. Mr. Gleason expressed strong disagreement with the statement that the use of tax increment financing is costing Eugene taxpayers 68 cents per $1,000 of assessed value. He said this is true only if one assumes that downtown would be as developed as it is today if the City had done nothing; this, however, would not have been the case if the City had done nothing. Therefore, the question is, what would have been the cost of running the City if downtown had remained at its old assessed value? Mayor Obie said this assumed that the development would not have occurred elsewhere in the city (i .e., not in the downtown core). e MINUTES--Eugene City Council September 30, 1987 Page 9