Item 2A: Approval of City Council Minutes

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Ms. Solomon stated that the problem was not that the transportation system was unsustainable, rather that revenues from other federal and state sources had decreased; it was funding that was unsustainable not the transportation system. She appreciated the option of a capital local option levy to add balance and stability to the funding strategy. She asked how much funding could be requested in the levy. Larry Hill, Financial Services, explained there was room within the Measure 5 rate cap for an additional capital local option levy and there would be no compression if the levy was appropriately sized. He said an average tax rate of $.75 per $1,000 of real market value could generate about $10 million annually. He said the levy was a “pay as you go” approach and unlike a bond there were no interest or issuance charges. Ms. Solomon felt there was a compelling argument for going to the voters with a capital local option levy as there did not seem to be enough support among councilors for a TSMF and the gas tax could not fill the funding gap. She hoped a TSMF would eventually be considered and that the option of a levy would be explored. Mr. Poling concurred with Ms. Solomon that it was incorrect to label the transportation system as unsustainable; the problem was that the council had lacked the courage to properly fund road repairs. He referred to a description of the levy as being for pavement reconstruction capital projects and asked if that meant roads that had to be torn down to the roadbed and rebuilt but capacity would not be added. Mr. Corey clarified that the language was a recommendation and not a limiting factor of the levy as a funding mechanism. He said that would ensure that the levy funds would be used to address the reconstruction backlog and other funding mechanisms could be used to address ongoing operations and maintenance and capital preservation. He said the levy could be used for a broader range besides reconstruction. Mr. Hill explained that a capital local option levy could be used for any capital construction that was legal under State statutes and only limited by what the council authorized it for and the use for which funds were appropriated. Mr. Poling suggested that if a levy was considered it be limited to fixing current roads and not used for adding capacity to roads or constructing entirely new roads. Referring to people who did not own or use a car, he agreed with Mr. Corey that they still benefited from having a transportation system in place. He was willing to consider reducing the burden on those people if they were required to prove limited road use, but would not consider exempting them from fees. He felt the commuter tax or employment tax was unfair as nonresidents had no voice in that. He was in favor of holding a public hearing on the gas tax but not certain if he would support the proposed increase. Mayor Piercy cautioned about the balance between a user tax on school buses and trying to put funding into the schools. Ms. Bettman thought the local option levy and a TSMF, if considered by the council, should both go on the ballot. She said how funds could be spent should be defined in the ballot measure instead of ordinance and explicitly exclude projects or components of projects that were SDC (system development charge) improvement fee eligible or assessment eligible; not just funded but eligible for funding. She asked if staff was recommending a uniform local option levy or a tax rate local option levy. Mr. Hill responded that the local option levy could be either rate-base or based upon an amount. He said the benefit of a rate-based levy was it adjusted to the increase of the value in the community and essentially indexed to growth and reflected growing demand on the community’s infrastructure. He said the benefit of a fixed amount each year was it MINUTES—Eugene City Council January 22, 2007 Page 7 Work Session