Item A: Downtown Development Financial Tools

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The City has developed a set of tools to invest in the development of affordable rental and ownership housing that is affordable to low-income households. The tools are typically used in combination with one another and with other subsidies allocated at the state level to make up the difference between development costs and the rents paid by low-income residents. The typical affordable rental housing development uses between 10 and 15 sources of funding to cover all necessary costs. The majority of the affordable housing resources may not be applicable to the development along West Broadway with the largest exception being the use of Low-Income Housing Tax Credits. Low Income Housing Tax Credits support the investment in affordable housing by providing equity for mixed-income or entirely affordable projects. The Federal program is administered by the State of Oregon. Several other City affordable housing tools and incentives that could potentially benefit a downtown development would include Systems Development Charge (SDC) Waivers, the Low-Income Rental Housing Property Tax Exemption Program, and the Homeownership Assistance Program. Example: WestTown on 8th th WestTown on 8, currently under construction by Metropolitan Affordable Housing Corporation, will offer 102 housing units affordable to persons at 60% of AMI or below and nine market rate live-work units. Tools used for the project include: Low-Income Housing Tax Credits CDBG funds through City’s Landbanking program for the site – (valued at $570,000 in 2004) $1,025,000 federal HOME Housing Development grant $222,000 Eugene System Development Charge Waivers 20 year Low-Income Rental Housing Property Tax Exemption $300,000 short-term low interest loan from the City – Housing Capital Project Fund and the Low- Income Housing Fund (generated through MUTPE fee payments). Other project subsidies for WestTown are provided by the Eugene Water and Electric Board and Lane County. F. City’s General Fund / Full Faith & Credit Pledge General Fund / Full Faith & Credit Pledge Summary Contribution to project from City’s general resources Provide security to bondholders for borrowings, with debt payments made from a particular revenue source, and ultimate back-stop by the City’s general resources Guarantee urban renewal financing on an interim period prior to receipt of incremental revenues The City’s General Fund resources and its full faith & credit pledge may also be used to assist with downtown development projects. General Fund resources are unrestricted and may be used for any public purpose. General Fund resources, however, are subject to significant competition from the City’s other services and programs. The City’s full faith and credit pledge may be used to provide security for borrowings that are repaid from other sources, such as building rental revenues, parking revenues or urban renewal tax increment revenues. The City’s pledge for such borrowings results in access to the public capital markets and a lower interest rate for those borrowings that might not otherwise be available. Examples: Broadway Place Garages, Atrium Building, Eugene Public Library The City has used its full faith & credit pledge to secure downtown development project financing in the past. The Broadway Place Garages were financed with the City’s full faith and credit obligations that are repaid from parking system revenues. The Atrium building was purchased with City full faith and credit Page 8 of 13