08/08/1984 Meeting - Laserfiche WebLink

Home Browse Search

regardi ng whether federal 1 aw woul d conti nue to allow jurisdictions to lend e their, tax-exempt status to qualified individuals, she said changes in federal legislation in 1983 and 1984 provided the opportunity for the City to develop its own program. She sai d the C; ty of Eugene program was model ed after the State of Oregon program. Ms. Smernoff then reviewed the policy document attached to the August 8, 1984, [DO memorandum to the City Council, highlighting the purpose, understandings, and eligible activites of the program. Councilor Holmer asked what advantage an investor would have in the industr;~ revenue bond beyond a lower rate of interest if the City was not responsible for the repayment of the loan. Wh i 1 e Counci lor Wooten responded that the investor woul d rece; ve a tax exempt status on the loan, Mr. Holmer sai d that exemption woul d be addressed in the market by the reduction in the interest rate paid on municipal bonds. Ms. Smernoff stated that any investor would be looki ng for a tax exempt investment. She sai d the bond purchaser and the appl icant woul d have to develop the chain of securiti es for the investment. She added that 50 percent of the bonds approved by the State were not sold on the market. Mr. Holmer asked if any consideration was given by the State or others to placing a restriction on the program to address any applicant getting an unfair economic advantage. Ms. Smernoff stated that neither State nor Federal 1 aws contai ned any requi rements or statements concerning competition between fi rms; she sai d the program was open to any qualified individual under the policy and administrative rules. In response to a question by Mr. Holmer, Ms. Smernoff stated that amending the Purpose statement to state "projects that fairly promote or develop" woul d not significantly change the intent of the policy document. She explained that it would leave to the di scret ion of the City Council the determi nation whether any unfai r e competition between firms existed. Councilor Wooten felt it would be a fine addition to the policy. She added that it was the intent of the CCED for the program to be used locally and as a tool for existing businesses as well as businesses wishing to relocate to Eugene. Res. No. 3873--A resolution approving and adopting the Industrial Development Bond Program for the Ci ty of Eugene. Ms. Wooten moved, seconded by Ms. Schue, to adopt the resol uti on. Mr. Hansen moved to amend the policy document to insert the word "fairly" in line two of the Purpose. Councilor Wooten said she agreed as long as it was understood that such wording did not imply any priority ranking or criteria not stated in the document. Councilor Obie, with the consent of the council, stated that the amendment was included in the main motion. Roll call vote; the motion carried unanimously, 7:0. e MINUTES--Eugene City Council August 8, 1984 Page 7