Item 4: Ordinance on MUPTE Exemption

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Action: 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 26, 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 City Council is asked to adopt an ordinance adopting a new sunset date for the Multi-Unit Property Tax Exemption (MUPTE) program in the Downtown Plan area. The ordinance also allows for an exemption to include the commercial portion of a multi-unit housing project to the extent that the commercial property is required or considered to be a public benefit. As previously, each MUPTE would be considered by the council on a case-by-case basis. 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. On September 19, the council held a public hearing to consider an ordinance to extend MUPTE for the Downtown Plan area and allow 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.” No public testimony was given and the public hearing was closed. The City Attorney recommends modifying the ordinance considered at the public hearing to make it clear that the new provisions would apply only to new applications. No change to the substance of the ordinance is proposed. Section 2 of the ordinance attached to the AIS reflects this modification. Timing & Next Steps 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. S:\CMO\2011 Council Agendas\M110926\S1109264.doc