Item 4 - Multiple Unit Property Tax Exemption Ordinance

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Public Hearing: An Ordinance Concerning Multiple-Unit Housing Property Tax Exemptions and Amending Sections 2.945 and 2.947 of the Eugene Code, 1971 Meeting Date: September 19, 2011 Agenda Item Number: 4 Department: Planning and Development Staff Contact: Nan Laurence www.eugene-or.gov Contact Telephone Number: 541-682-5340 ISSUE STATEMENT The City Council is asked to hold a public hearing regarding an ordinance to consider a new sunset date for the Multi-Unit Property Tax Exemption (MUPTE) program in the Downtown Plan area. BACKGROUND The Multi-Unit Property Tax Exemption (MUPTE) program is enabled by state legislation (ORS 307.600) and designed to encourage higher density housing and redevelopment in the core area and along transit corridors. The program provides a 10-year property tax exemption on qualified improvements; the land continues to be taxed during the exemption period. See Eugene City Council Agenda Item Summary for July 20, 2011, for additional background information. On July 20, 2011, the council considered MUPTE in the context of Envision Eugene and directed the City Manager to proceed in two phases: 1) prepare an ordinance and hold a public hearing to extend the sunset date for MUPTE within the Downtown Plan area, and 2) conduct additional work sessions in the fall to discuss other priority areas for council consideration and future action. The ordinance extending MUPTE for the Downtown Plan area is attached. In alignment with the state legislation, the ordinance extends the program sunset date within the Downtown Plan area from January 1, 2012, to January 1, 2022. Also per state legislation, the ordinance allows for an exemption to include the “…commercial portion of a multi-unit housing project to the extent that the commercial property is a required design or public benefit element of a multiple-unit housing construction, addition or conversion approved by an authorizing city.” Other than these changes, the approval criteria remain the same, and each MUPTE would continue to be approved on a case-by-case basis by the council. Envision Eugene City staff anticipates returning to the council for a work session later in the fall to discuss the application of MUPTE in areas other than the Downtown Plan area. The areas proposed for council discussion will reflect the insights and implementation strategies emerging from Envision Eugene. Timing & Next Steps In order for MUPTE to be continued as an economic tool in the Downtown Plan area, the council needs to take action in the form of holding the public hearing and adopting the new ordinance. Action on the ordinance is scheduled for September 26, 2011. S:\CMO\2011 Council Agendas\M110919\09-19-11 - Item 4 - MUPTE Ordinance.doc