Item C: Ordinance Concerning Real Property Value-Added Charge

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Work Session: An Ordinance Establishing a Real Property Value-Added Charge; Adding Sections 2.100, 2.105, 2.110 and 2.115 to the Eugene Code, 1971; Amending Section 8.005 of that Code; and Adopting a Severability Clause Meeting Date: December 11, 2006 Agenda Item Number: C Department: Planning and Development/City Attorney Staff Contact: Susan Muir/Glenn Klein www.eugene-or.gov Contact Telephone Number: 682-6077/682-5080 ISSUE STATEMENT Under Ballot Measure 37, governments must pay compensation or waive regulations when certain regulations restrict the use of property and reduce its value. The measure did not provide any funding with which to pay those Measure 37 claims. The proposed ordinance would establish a real property value-added charge to be paid when certain regulations increase the value of the property. Such a charge would allow the City to create a fund with which to pay valid Measure 37 compensation claims. BACKGROUND The council’s first work session was held on January 25, 2006, at which it reviewed and discussed four separate options for a possible fee or tax to fund payment of Measure 37 claims. Following additional work sessions, the council directed the City Manager to bring back to the council for public hearing an ordinance that would impose a charge of 25% of the increase in value when the increase was the result of citizen-initiated requests for zone changes, plan designation changes, or a change in the Urban Growth Boundary (UGB). The charge also would be imposed for those actions when initiated by the City or other governmental entity, but only if the property owner submitted some type of application (for example, building permit application) that could not have been approved without the City’s action making a change in the zoning, Metro Plan, Refinement Plan or UGB. On October 16, 2006, the council held a public hearing on the proposed ordinance, which is attached as Attachment A to this Agenda Item Summary (AIS). After discussion and consideration of the testimony presented at the public hearing, the council unanimously approved a motion to leave the record open until 5:30 p.m. on October 30, 2006. In addition, following the public hearing, the council asked a number of questions and directed that a work session be scheduled where staff could return to council with answers to those questions. The balance of this section provides answers to the questions and identifies some of the policy questions raised by the testimony. Some of the questions and comments by councilors also sought amendments to the ordinance. Attached as Attachment B are suggested motions to amend the ordinance based on the requests following the public hearing. Is the real property value-added charge a “land use regulation” that would create new Measure 37 claims? No. “Land use regulation” – for purposes of measure 37 – is defined as a land division ordinance, a zoning ordinance, a transportation ordinance or a comprehensive plan. (The definition also includes L:\CMO\2006 Council Agendas\M061211\S061211C.doc