Item 4: MUPTE for Student Housing Project

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ATTACHMENT I Economic Impact The City anticipates that the economic impact from the Capstone project will be in three main areas: 1.Tax impacts. The land will be taxed during the MUPTE period, and the land plus the improvements will be taxed after the project is complete and the MUPTE period expires. The estimated property tax paid on the land for year 1 is $100,000. The estimated property tax for the entire development is $1.2 million in year 11. If the project does not move forward, tax revenue will be minimal on the chronically underdeveloped site. 2.Construction jobs and secondary benefit. Capstone estimates that 380 construction jobs will be created to construct the project. Based on estimates from Tim Duy, Senior Director of the Oregon Economic Forum, construction jobs generate a multiplier in the ratio of 1.84. In other words, an increase in construction spending of $100 will yield a net impact on the regional economy of $184. The mean hourly wage of all Eugene’s occupations is $20.11 an hour. An average of construction jobs’ wages in the Eugene-Springfield MSA is about $22.09 per hour, which is approximately 9% higher than the local, average job. Construction is about 3% of the local labor force. This project could be a partial counterweight for the continued sluggishness in residential/commercial construction as construction lost 200 jobs in 2011. Capstone has not made the final selection of the general contractor at this time. Capstone policy is to encourage the use of local contractors, suppliers, and workers for the project as much as possible. It is anticipated the general contractor will use a high percentage of qualified local and area subs, suppliers and workers. 3.Resident discretionary spending for downtown. Students spend discretionary funds in the community where they live. The University of Oregon’s estimate for the purpose of calculating livings costs assumes approximately $250 per student per month; the national estimate of monthly student discretionary spending is about $350. At the lower estimate, the residents of the Capstone project could spend up to $3.7 million per year. At least a portion of that could be spent downtown and may not otherwise occur if the project was located outside of downtown. 4.On-site permanent jobs. Capstone estimates five to seven permanent and fifteen to eighteen part-time operations jobs (including three professional courtesy officers), with approximately $500,000 spent on local services on an annual basis.