Item 3: Ordinance on Low-Income Housing Property Tax Exemptions

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Public Hearing: An Ordinance Concerning Low-Income Housing Property Tax Exemptions and Amending Sections 2.916, 2.920, 2.938, 2.939 and 2.940 of the Eugene Code, 1971 Meeting Date: April 11, 2011 Agenda Item Number: 3 Department: Planning and Development Staff Contact: Becky L. Wheeler www.eugene-or.gov Contact Telephone Number: 541-682-5532 ISSUE STATEMENT The City Council will hold a required public hearing to consider an ordinance amending the Eugene Code extending the sunset date for the low-income housing property tax exemption program and the 20- year low-income rental housing property tax exemption program. The proposed ordinance would extend the sunset date by 10 years for each program. In addition, the proposed ordinance would enable recipients to reapply for the 20- year low-income rental housing property tax exemption after the initial 20-year period has expired. Action on this item is scheduled for April 13, 2011. BACKGROUND Both the low-income housing property tax exemption and the 20-year low-income rental housing property tax exemption are enabled by state statute. The low-income housing property tax exemption provides an annual exemption for properties that are used for the purposes of a nonprofit corporation. This housing is not required to be rental housing. The 20-year low-income rental housing property tax exemption provides a 20-year exemption for properties offered for rent or held for the purpose of developing low-income rental housing. Applicants requesting a 20-year exemption are not required to be a nonprofit in certain instances. In 1992, the City Council adopted both programs to facilitate the development of affordable housing for low-income persons. In compliance with provisions enacted by the Oregon Legislature, the City Council adopted Sections 2.910 to 2.922 and Sections 2.937 to 2.940 of the Eugene Code, 1971, which provides procedures for granting exemptions from ad valorem taxes on low-income housing and low- income rental housing developed by non-profits. The Oregon Legislature extended the sunset for both the low-income housing property tax exemption annual renewal program and the 20-year low-income rental housing property tax exemption program by another 10 years to 2014 and 2020, respectively. In order to continue these programs, current Eugene Code, 1971 must be amended to reflect changes in state law. Changes to be Made Eligible tax years – Subsection (2) of Section 2.916 and subsection (2) of Section 2.920 of the Eugene Code, 1971, need to be amended to extend the tax years in which applicants are eligible to receive an \\Cesrv500\cc support\CMO\2011 Council Agendas\M110411\S1104113 - and Att's A and B.doc