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Responding to questions from Mr. Rutan about options, Mr. Byrne said the Down- e town Commission considered doing only some of the improvements. Members gave projects priorities and the list presented to the council is in that order. Downtown Commissioners decided that all the projects are needed now. Another option would be to lease the commercial space as it is now at reduced rates. Such rates probably would not pay the operating expenses of the building. If the building is upgraded, the commercial space will be leased at market rates. Selling the building has been considered, but it has not been offered for sale. Parking garages may pay operating expenses, but they do not usually pay a mortgage. Mr. Gleason added that a paid parking program might enable a parking garage to pay back a purchase price. Mr. Rutan wondered if the Urban Renewal Agency should pay for improvements to the Overpark with the hope the expenses will be recovered in a tough rental market. Responding, Mr. Byrne said some propective tenants have indicated an interest in renting space, which would increase the annual income of the Over- park by $51,000, but they will only rent the space if the improvements are made. If the building is not upgraded, probably the existing tenants will leave. Answering a question from Ms. Ehrman, Mr. Jungjohann said the most important thing to prospective tenants is an improvement in the image of the Overpark. They want people to be comfortable using the building. The list of projects is in the order of importance to prospective tenants. Replying to Mr. Hansen, Mr. Jungjohann said the tenants who have left the e building rented it at reduced rates and have failed. Only one prospective tenant has been interested in space at a reduced rate of 35 cents a square foot, which would not pay the operating expenses of the building. The pro- posed improvements would pay for themselves over the period of the leases he has been discussing with prospective tenants. The market rate in the area is 75 cents a square foot. The average downtown rent is about 55 cents a square foot. Responding to questions from Ms. Schue, Mr. Byrne said the urban renewal fund has a working balance of $2.9 million. The working balance provides required reserves, loans for developers, and other debt service reserves. The current appropriation for capital improvements would cover about $200,000 of the Over- park improvements. A supplemental budget would have to be approved for about $200,000. Responding to questions from Ms. Wooten, Mr. Byrne said the "cut-off points" considered by the Downtown Commission were after the lease space repair, the storefront renovation, and the alley improvements projects, and then after those projects and the ground floor entries and the exterior stairway pro- jects. The five projects would cost about $192,000. Commenting on the proposed improvements, Ms. Bascom said she does not like to use the Overpark. The proposed improvements need to be approved if the buil- ding is to useful. She did not think any of the projects should be elimina- ted. She thought the outside stairways and the openings in the concrete are especially important. e MINUTES--Eugene City Council October 9, 1985 Page 5