Item B: URA - West Broadway Preliminary Financing Plan

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Staff recommends Option 3. The attached urban renewal plan and report are based on Option 3 maximum indebtedness figures. Extend Termination Date:The Downtown District is scheduled to terminate ion June 30, 2024. If the district entered into a new debt obligation (after substantially amending the plan) in FY08, the district would have 16 years to repay the debt obligation. In order to increase the borrowing capacity of the district to take on the West Broadway redevelopment project, staff recommends that the termination date be extended to June 30, 2030. This would allow the Agency to maximize a debt issuance with a 20 year final maturity. Holding all else constant, a shorter district termination date would mean having a smaller debt capacity. The City could respond to this one of two ways. First, the City could make up for a smaller debt capacity by using other resources outside of the urban renewal district. This approach would enable the urban renewal district to issue a smaller amount of debt, but with the same level of revenue cushion. Second, if the City wanted to issue the same amount of debt, but with a shorter repayment schedule, the annual payments would be higher than in the longer repayment scenario. The revenue cushion would, therefore, be smaller. As a result, banks would be likely to ask for additional security from the City for the borrowing. The additional security would probably be a pledge of the City’s general fund resources. The City did this with the library financing. The City issued debt that was to be repaid by the urban renewal agency. In the event that the agency did not have sufficient revenues to pay the debt, the City’s general fund would make up the difference. The City has not had to use general fund resources to pay the library debt. Staff recommends extending the district termination date to June 30, 2030 to maximize the ability of the district to use its borrowing capacity for the West Broadway redevelopment project. Boundary Expansion: If the City undertakes the significant process required by statute for a “substantial amendment” to the Downtown Urban Renewal Plan, the Agency Board might also want to consider expanding the district’s boundaries at this time. Given the public notifica- tion requirements and the high degree of citizen participation associated with a “substantial plan amendment”, staff recommends adding public consideration of a boundary expansion. State law limits urban renewal district expansion to 20% of its original size. The Downtown District boundary has never been amended. The district encompasses 70 acres and therefore the maximum expansion is 14 acres, or slightly greater than three typical downtown blocks. Any expansion must be attached to the current district. There are two significant opportunity areas adjacent to the district: the Eugene Clinic area and the County Annex area. th Eugene Clinic: The site of the Eugene Clinic is at 12 and Willamette. Much of the site has been cleared of former buildings and is now used for surface parking. PeaceHealth has indicated their plans to vacate the buildings on site after their new hospital opens. This may be an excellent opportunity area – particularly for downtown housing.