Item A: Downtown Update - East Broadway Development Project

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The development agreement will specify that the completed public parking garage will be similar in scope and design with drawings submitted by GED, as presented to the council at the February 13 work session. Staff will continue to address the urban design goal of orienting the commercial space along 8th as much as possible. Publicly-owned, privately leased commercial space exists in many of the other City-owned garages. Based on City Council discussion on February 13, staff is also exploring the option of structuring the ownership and design of this commercial space so that it could be sold or maintained as publicly-owned space. GED will be responsible for constructing the parking structure (including the commercial space). Because that structure is a public improvement project, GED will have to comply with all applicable public contracting laws and prevailing wage requirements. 4) Intergovernmental Agreement between the City and Urban Renewal Agency An intergovernmental agreement between the City and the Urban Renewal Agency (URA) would cover the terms of the agency’s participation in the garage purchase. It would also set out the agreement for the agency to reimburse the City for the facility reserve’s contribution to the garage project. The IGA would have to be approved by both the City and the URA. Attachment D includes the outline of terms for this agreement. At the February 22 City Council meeting, a question was raised about the reimbursement component of the proposed intergovernmental agreement. Under the proposed IGA, the URA will send one-half of any excess of current year revenues over current year expenses back to the City to reimburse the City’s contribution from the Facility Reserve. The question raised was whether the URA had the ability to increase spending in the budget each year to ensure that there was no excess available to be sent back to the City. The answer to the question is yes, the URA has the ability to increase spending in the budget. It would be the City Council (when it acts as the URA board), however, that would approve any budget changes and choose whether or not to ensure excess funds are available to repay the City’s contribution from the Facility Reserve. That decision cannot be made unilaterally by staff or by the Eugene Redevelopment Advisory Committee. It is only a decision of the City Council when they act as the URA board. Financial and/or Resource Considerations The financing strategy recommended by staff is for the Riverfront Urban Renewal District to pay for as much of the costs of the garage project as possible. Attachment E includes the details of the strategy. On March 15, the council will be asked to consider a supplemental budget for the costs of the City’s participation in this project. The total cost, including payment to the developer and other related City costs, is estimated to be $8,035,000. Funding for the project would come from several sources: Riverfront Urban Renewal District revenue bonds of $4 million; Riverfront District cash of $1.5 million; City stormwater funds of $0.25 million; City Library Debt Service Fund reserves of $0.475 million; and City Facility Reserve of $1.8 million. Under this approach, the Riverfront Urban Renewal District would pledge all of its revenues, after paying for district administration costs, to this garage project, either as an up-front cash contribution or to service debt in future years. L:\CMO\2006 Council Agendas\M060315\S060315A.doc