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<br />Year 1Year 2Year 10 <br />Without MUPTE <br />Rent Income$ 158,400$ 159,984$ 173,240 <br /> - Vacancy (5%)$ 7,920$ 7,999$ 8,662 <br /> = Effective Gross Rent$ 150,480$ 151,985$ 164,578 <br /> - Operating Exp (25%)$ 39,600$ 39,996$ 43,310 <br /> = NOI <br />$ 110,880$ 111,989$ 121,268 <br /> - Debt Service$ 114,606$ 114,606$ 114,606 <br /> = CF <br />$ (3,726)$ (2,617)$ 6,662 <br />Cash on Cash Return -1%-1%2% <br />Value <br />$ 1,643,000$ 1,659,000$ 1,797,000 <br /> <br />Fiscal Impact <br />This property currently generates $4,136 in property taxes. Based on valuation, 33% is attributed to the <br />land. The land continues to be taxed during the exemption period. Staff estimates the land tax at $1,378 <br />annually. If approved for MUPTE, about $2,758 that is currently collected each year from the existing <br />improvements will be lost ($27,580 over ten years). The new apartments are estimated to generate <br />$15,122 annually in taxes. Therefore, the lost revenue will likely be recovered in year 12, two years <br />after the MUPTE period ends. <br /> <br />Timing <br />This application was submitted on November 14, 2008. If the council does not act within 180 days the <br />application is considered approved. The council will have received the Director’s report in the first 90 <br />days and consideration will take place soon thereafter. <br /> <br /> <br />RELATED CITY POLICIES <br />MUPTE is enabled by state statute. The City of Eugene has participated in the MUPTE program since <br />1978. Encouraging housing in the core area is consistent with numerous adopted planning and policy <br />documents. Examples include: <br /> <br />Growth Management Policies <br />Policy 1 Support the existing Eugene Urban Growth Boundary by taking actions to increase <br />density and use on existing vacant land and under-used land within the boundary more <br />efficiently. <br />Policy 2 Encourage in-fill, mixed-use, redevelopment, and higher density development. <br />Policy 3 Encourage a mix of business and residential uses downtown using incentives and zoning. <br /> <br />West University Refinement Plan <br />V.9 The City will encourage residential uses in all parts of the plan area. <br /> <br />V.11 The City and the neighborhood shall study ways to encourage a variety or mix of <br />structure types providing both owner and rental opportunities and appealing to a diverse <br />population. <br /> Z:\CMO\2009 Council Agendas\M090112\S0901126.doc <br />