Agenda Packet 10-15-18 Work Session

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October 15, 2018, Work Session – Item 1 EUGENE CITY COUNCIL AGENDA ITEM SUMMARY Work Session: Modifications to the Transportation System Development Charge Methodology Meeting Date: October 15, 2018 Agenda Item Number: 1 Department: Public Works Engineering Staff Contact: Dan Kaler www.eugene-or.gov Contact Telephone Number: 541-682-5216 ISSUE STATEMENT The City Council is being requested to direct the City Manager to amend the modifications to the transportation system development charge methodology in response to the comments received at the public hearing and to the concerns raised by the City Council. The amendments include phasing in the rate increase over two years, increasing the accessory dwelling unit reduction from 50 percent to 100 percent, and setting an annual financial limit for the proposed incentives. BACKGROUND System development charges are intended to provide an equitable means of funding capital improvements that provide capacity in infrastructure systems needed to serve growth. SDCs are collected by the City of Eugene to fund capital projects in four primary infrastructure systems: wastewater (both local and regional), stormwater, parks, and transportation. SDCs must be expended on capital projects related to the system for which they are collected. Examples of the types of transportation projects funded in part by TSDCs include pavement preservation on arterial and collector streets, traffic signal/intersection improvements, and off-street bike paths. Two forms of SDCs, improvement and reimbursement fees, recognize that capacity to meet the needs of growth is provided in two forms—new capacity-increasing capital improvements, and reimbursement for extra capacity built in the past in systems and paid for by the general community. Improvement fee SDCs may be spent only on capacity-increasing projects. Reimbursement fees may also be spent on rehabilitation projects. The City has a combination of both reimbursement and improvement fee elements in each system’s SDC. Public Hearing The City Council held a public hearing on the proposed TSDC methodology on June 18, 2018. There were three entities that provided public comment: a) Chamber of Commerce, b) Home Builders Association, and c) a private home builder. The Chamber of Commerce expressed concerns with the higher costs to the building industry and suggested a phased approach for the proposed TSDC increase. Additionally, the Chamber of Commerce supported a 100 percent reduction for Accessory Dwelling Units. The Home Builders Association expressed caution in approving transportation plans prior to knowing the financial consequences and it was suggested