Item C: Ordinance Concerning Real Property Value-Added Charge

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– Section 2.100(1) – states that the purpose is “to develop a fund that can be used to pay compensation when a valid Measure 37 is filed.” The ordinance, however, does not contain an explicit limitation. Amendment 1A on Attachment B would add such an explicit limitation. Can the purpose of the fund be expanded to include use of the funds to purchase conservation easements in order to avoid the filing of and having to pay Measure 37 claims? Yes. The council has the power to impose the value added charge and to use the funds to purchase conservation easements. Amendment 1B on Attachment B would accomplish that purpose, as well as explicitly limit the use of the funds to payment of compensation for valid Measure 37 claims or to purchase conservation easements to avoid Measure 37 claims. Can a property owner pay the charge at the time of sale, rather than at the time of the change in zoning, UGB status or plan designation? As drafted, the ordinance requires payment at the time of the change (for a requested change) or at the time that the owner takes advantage of a change (for a non-requested change). The council could choose to allow a property owner to pay at the time of sale. In order to ensure that the City received payment, staff would recommend that the mechanism for such a deferred payment be similar to deferral of a local improvement district assessment: the property owner is given a choice to pay now, or to sign an agreement that gets recorded on the property requiring payment of the charge (plus interest). Amendment #2 on Attachment B would accomplish that purpose. Does the ordinance exempt land held by public entities or land zoned PL from payment of the value added charge? No. As presently drafted, the ordinance applies to publicly owned, as well as privately owned, land. The council could choose to exempt land held by public entities if it wanted to do so. Should the ordinance exempt zone changes which will conform a property’s zone to the property’s Metro Plan designation? The ordinance does not contain such an exemption, but the council could choose to exempt such zone changes. Should the ordinance apply only to those applications for amendments (to a property’s zone, UGB status, or designation in the Metro Plan or a refinement plan) that are submitted after the effective date of the ordinance? As presently drafted, the ordinance would apply to any application that is pending as of the effective date of the ordinance. The council could choose to have the ordinance apply only prospectively: i.e., only to those applications that are submitted after the effective date of this ordinance. Should the ordinance apply only to “requested” changes, and not to “non-requested” changes? As presently drafted, the ordinance applies to both. The council could choose to delete the provisions related to non-requested changes. Should the council postpone action on the ordinance until after the 2007 legislative session and after a work group of interested parties (including such parties as 1000 Friends of Oregon, appraisers and the Home Builders Association) can work with staff to develop an improved-version of the ordinance? In the weeks following the public hearing, Susan Muir was contacted by Rob Zako and Rick Duncan requesting an opportunity to meet to discuss some possible deficiencies in the ordinance. During and L:\CMO\2006 Council Agendas\M061211\S061211C.doc