05/17/1989 Meeting - Laserfiche WebLink

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e development of sidewalks on 11th Avenue in front of the project, and possible streetscape improvements on Willamette Street to complement the building. Mr. Rutan asked what the balance of the Tax Allocation Fund will be after loans have been made to the Pankow and St. Laurent development companies. Mr. Hibschman said approximately $1.5 million will remain in the fund to be used as additional support for buildings in the downtown area which are undergoing rehabilitation or change of use, and to cover other site-development costs associated with the Pankow project. He said upon completion, the St. Laurent project is expected to have an annual flow of approximately $160,000-$170,000. Mr. Boles thought the council should be clear in the memorandum of understanding about whether it intends to allow a waiver of interest accrued on the loan from the Tax Allocation Fund or to permit deferred payment. Mr. Gleason emphasized that the points laid out in the memorandum of understanding are the preliminary deal points; the ERA will have an opportunity to approve the actual development agreement. e Mr. Gleason explained the reason for including the possibility of a waiver in the memorandum of understanding. He said, unlike the other public parking facilities that the City has developed, these structures will be paid for by the market. If the parking spaces can be leased at a market rate that is high enough to cover the costs of principal, interest, and taxes, then the developer will pay all of these. If not, the interest may be waived, and the developer will have to pay at least interest and taxes. Mr. Gleason said it is impossible to know at this point whether the market value of the spaces will cover the principal, interest, and taxes for the structure. He added that the City's preferred position will be to defer the interest on the loan; the last resort will be to waive it. Mr. Bennett pointed out that a developer cannot practically develop housing in the downtown area without also providing parking. In addition, once this parking has been provided, it is not practical to make it available to the public for security reasons. Mr. Rutan moved, seconded by Ms. Schue, to authorize the City Manager to execute the memorandum of understanding with the St. Laurent Development company on behalf of the Eugene Renewal Agency. Mr. Green asked if the rental rate for the housing in this project will be competitive. He emphasized that the goal of the council is to encourage housing in the downtown core and pointed out that merely providing housing units will not meet this goal; the rents must be reasonable if people are to occupy the units. Mr. Green expressed concern that the housing portion of the project would remain unoccupied. Mr. Hibschman said staff looked at housing survey information for the city when developing this agreement. He said both staff and the developer believe there is a demand for the type of housing planned for the project, at the anticipated rental rates. e MINUTES--Eugene City Council May 17, 1989 Page 4