Item 2D: Approval of Low-Income Rental housing Property Tax Exemption

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awarded from the State, market conditions and consequent investor wariness prohibited the sale from closing as quickly as anticipated. ShelterCare worked diligently with a consultant and secured a tax credit investor and a permanent lender in the fall of 2010. ShelterCare successfully acquired the property in December. Resolution 4999 provided that the tax exemption commence on July 1, 2010, and continue for a continuous period of 20 years. However, due to delay of the sale of the property, the exemption was not commenced on July 1, 2010. It is necessary to amend Resolution 4999 so that the exemption will commence on July 1, 2011, thereby providing the full 20 years of the property tax exemption for the property. In addition, Resolution 4999 declared the residential units on the property exempt from local ad valorem property taxation; however, the resolution should have declared both the land and residential units exempt as permitted by Section 2.940(5) of the Eugene Code, 1971. Therefore, Resolution 4999 should also be amended to reflect that the land and residential units are granted the exemption. Without the property tax exemption the affordability of the units would be compromised. This property tax exemption is critical for the project’s financial viability. RELATED CITY POLICIES The City of Eugene affordable housing development programs support a number of the City Council Adopted Growth Management Policies. The recommended project directly supports the following Growth Management Policies:  Promote construction of affordable housing.  Encourage in-fill, mixed-use, redevelopment, and higher density development.  Improve the appearance of buildings and landscapes.  Provide for a greater variety of housing types. COUNCIL OPTIONS A. Approve the amendment of Resolution 4999. B. Direct the City Manager to provide additional information for further consideration of the amendment to Resolution 4999. C. Deny the requested amendment to Resolution 4999. CITY MANAGER’S RECOMMENDATION The City Manager recommends Option A, the approval of the amendment of Resolution 4999 granting a th 20-year property tax exemption to 29 Place. SUGGESTED MOTION Move to adopt Resolution 5025, amending Resolution 4999 approving a low-income rental housing property tax exemption for the land and property located at 2984, 2986 and 2988 Oak Street, Eugene, Oregon (ShelterCare/Applicant). \\Cesrv500\cc support\CMO\2011 Council Agendas\M110228\S1102282D and atts A and B.doc