Ordinance No. 20459 - Laserfiche WebLink

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per year (based on FY10) after accounting for the State's system for school funding. The State determines how much money must be allocated for the education of each pupil across the state. If the money is not available from local property taxes, the State will make up the difference. In FY10, the Downtown Urban Renewal District diverted $650,000 of local property taxes that would have gone to education. The State made up the difference. If the Downtown Urban Renewal District had not diverted those funds, the State would have had the additional $650.,000 to allocate as it chose. In other words, the State could have chosen to allocate the money to education or to some other budgetary priority. Had the State chosen to keep the money in education, some of that money would have returned to Eugene schools based on the applicable statewide school funding formula. Under the formula, Eugene School District 4j would have received about $20,000; LCC would have received about $10,000; and Lane Education Service District would have received about $1,000. As a result of the Downtown Urban Renewal District, the State provided a net $629,000 for spending in Eugene. Without this increment financing, those funds would be used to fund school districts throughout the state. The Lane County Assessor conducted an analysis of the impact of the Downtown Urban Renewal District on School District 4j's local option levy, and that analysis was reviewed and confirmed by 4j School District finance staff. The analysis concluded that 4j is better off financially if the Downtown Urban Renewal District continues to collect tax increment funds than it would be if tax increment financing were terminated. The reason is that taxes that are currently counted under the "general government" category for Measure 5 tax rate limitations (i.e., the "school property tax dollars" that now go to urban renewal) would move into the "schools" category. When that happens, the schools category of taxes must be reduced for a number of individual properties within the City because schools are already collecting as much as they can under Measure 5 limits for those properties. State law says that local option levy proceeds are the first to be reduced in the event of compression. For FY10, the Lane County Assessor estimates that the positive benefit to School District 4j from the existence of the Downtown Urban Renewal District is about $137,000. These additional local option levy proceeds are extra funds available for educational programs at School District 4j and are outside of the state school funding formula. The overall net benefit to School District 4j from the Downtown Urban Renewal District, after subtracting out a $20,000 net loss from the division of tax calculation is $117,000. Reduced Rate Plan: The Downtown Urban Renewal District is a "reduced rate plan" under the statutes, which means that the property taxes that may be used to fund urban renewal activities is limited to the permanent tax rates and any bonds or local option levies that were approved by voters prior to October 2001. The projected tax rate used to generate urban renewal revenues for the district will be reduced over time as bonds approved by voters before October 2001 are paid off. Report on the 2010 Amendment 16