Admin Order 58-11-01-F - Laserfiche WebLink

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Response: In accordance with the adopted Eugene SDC methodologies, SDC fees and credits may be periodically adjusted to account for changes in construction costs and system valuation. The City's adopted cost index by which to adjust SDCs is the 20 -city national Construction Cost Index (CCI) as published by the Engineering News- Record (ENR). City of Eugene Staff is acutely aware of the economic downturn that this community has, and continues to endure. Proposed adjustments scheduled in 2009 for local SDC rates and related SDC administrative fees were delayed until calendar year 2010 to provide relief to the development community. There are a couple of down -sides to the delay of periodic construction cost adjustments, one being that when the new rates are finally adopted they reflect a longer rate adjustment time period and result in higher spikes in actual adjustment rates when implemented than if they had been adjusted over shorter periods of time. The other down side is that the planned public infrastructure projects to be funded, fully or in part, by SDC revenues are delayed. In response to this comment, the effective date of this administrative order has been delayed to June 1, 2011. This June 1, 2011, effective date will correspond with the effective date of the reduction to parks SDC rates that City staff will be proposing to the City Council. If Council adopts the proposed park SDC rates reduction, that rate adjustment together with this administrative order's 3.5% rate increase will result in an overall reduction in the amount of SDCs currently collected for the average single- family home. Specifically, if the Council approves City staff s recommendation to reduce the parks SDC with the June 1, 2011 effective date, the total SDCs collected for an average single- family home will be approximately - 0.98% or - $88.15 less than is currently collected in SDCs. Comment 8 : Lori and Mike Butler have been building homes in Lane County for over thirty years and this year were forced to lay off employees that have been associated with them for twenty years. Their goal is to get these people back to work, in many cases back to work in the only thing they know. Now, they are shocked at the City's plans to increase SDCs when the area has been in a deflationary environment. They ask that the increase be deferred for a twelve month period of time to allow for the economy to show some improvement. Response In accordance with the adopted Eugene SDC methodologies, SDC fees and credits may be periodically adjusted to account for changes in construction costs and system valuation. The City's adopted cost index by which to adjust SDCs is the 20- city national Construction Cost Index (CCI) as published by the Engineering News - Record (ENR). City of Eugene Staff is acutely aware of the economic downturn that this community has, and continues to endure. Proposed adjustments scheduled in 2009 for local SDC rates and related SDC administrative fees were delayed until calendar year 2010 to provide relief to the development community. There are a couple of down -sides to the delay of periodic construction cost adjustments, one being that when the new rates are finally adopted they reflect a longer rate adjustment time period and result in higher spikes in actual adjustment rates when implemented than if they had been adjusted over shorter periods of time. The other down side is that the planned public infrastructure projects to be funded, fully or in part, by SDC revenues are delayed. Administrative order - Page 7 of 8