Item 7: Resolution Approving a Low-Income Rental Housing Tax Exemption - River Road

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development is inconsistent with the City’s Housing Dispersal Policy. The City Attorney has determined the proposed housing is not considered subsidized housing for the purposes of the Housing Dispersal as the policy defines low-income as those at 50 percent AMI and this development targets those at 60 percent AMI. A decision to approve or deny this tax exemption request must be based on the criteria included in the City’s Code. Summary of the low-income rental housing property tax exemption program The City adopted the low-income rental housing property tax exemption program in 1990. Since then, Eugene has approved tax exemptions for more than 20 developments with over 1,000 units. In 2011, the council unanimously approved extending the 20-year low-income rental housing property tax exemption program for an additional 10 years. The approved ordinance also permits recipients to reapply for the 20- year low-income rental housing property tax exemption after the initial 20 year period has expired. The council reviews each tax exemption request on a case-by-case basis. Most recently, the council approved a low-income rental housing tax exemption for St. Vincent de Paul’s Stellar Apartments in July 2012. Approval of the low-income rental housing property tax exemption If an application meets the substantive criteria [EC 2.939(2)(a)-(i) or EC 2.939(3)(a)-(e)], the City must grant the exemption by resolution. A decision to deny the exemption cannot be made by simple motion or inaction; it would need to be made by a resolution that explains how the applicant has failed to demonstrate that the tax exemption meets applicable criteria for approval. The requested exemption meets the substantive criteria [EC 9.239(2)(a)-(i)] as shown below and in the Community Development Manager’s Report and Recommendation (Attachment A). EC 2.939(2) Upon receipt of the City Manager's recommendation, the council shall consider the application and grant or deny the property tax exemption. The City Manager shall recommend approval of an application, and the council shall grant the exemption upon determining satisfactory compliance with or mitigation of the following criteria: (a) If unoccupied, the property: 1. Is offered for rental solely as a residence for low-income persons; or 2. Is held for the purpose of developing low-income rental housing; The property, or portion thereof subject to the property tax exemption, will be occupied solely as a residence for low-income persons. The property is currently vacant. One hundred percent of the development, once constructed, will be offered to families and individuals at 60 percent area median income (AMI). Low-income is defined under Eugene Code 2.937 as “Income at or below 60 percent of the area median income as determined by the State Housing Council based on information from the United States Department of Housing and Urban Development.” (b) If occupied, the property, or portion thereof subject to the property tax exemption, is occupied solely as a residence for low-income persons; The property is not occupied. (c) The required rent payment reflects the full value of the property tax exemption. Without the LIRPTE, the low rents cannot be achieved to meet limits prescribed by the Low-Income S:\CMO\2012 Council Agendas\M121126\S1211267.doc