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HomeMy WebLinkAboutItem 2D - Ext. Tate MUPTEEUGENE CITY COUNCIL AGENDA ITEM SUMMARY Adoption of Resolution 4825 Extending the Completion Date for Construction of Residential Units Granted a Multiple-Unit Property Tax Exemption Under Resolution No. 4815 (1375 Olive, LLC) Meeting Date: February 14, 2005 Agenda Item Number: 2D Department: Planning and Development Staff Contact: Richie Weinman www. cl. eugene, or. us Contact Telephone Number: 682-5533 ISSUE STATEMENT City Council is asked to approve a resolution granting an extension for the Multi-Unit Property Tax Exemption (MUPTE) for "The Tate" at 1375 Olive Street. BACKGROUND On November 22, 2004, the council approved a Multi-Unit Property Tax Exemptions (MUPTE) for The Tate. The adopted resolution reflected the current provision in the State statutes that require housing projects to be completed for occupancy by January 1, 2006. January 1, 2006, is when the current State enabling legislation for MUPTE sunsets, unless the current legislature extends the program. (The legislature is likely to approve that extension). However, the state statute also allows participating jurisdictions to subsequently approve a one-year extension for approved projects. The Tate is actively proceeding and may break ground in the next month. However, it can not reasonably be expected to be complete for occupancy by January 1, 2006. Therefore, the applicant requested the allowed extension. The council's approval of the extension is immediately critical for financing. This action is being placed on the Consent Calendar because it is essentially a housekeeping item to comply with State law. The project itself is not changing from what the council approved. The council has a 26-year history of supporting tax exemptions to encourage new housing in the core area. This project is proposed for a site that was a City of Eugene parking lot serving the former library and permit parkers. When the site was purchased last year, the applicant stated that this tax exemption was critical to the project. Subsequently, City Council expanded the MUPTE boundary to specifically include this site. In April 2004, the MUPTE program regulations and boundary were further amended. L:\CMO\2005 Council Agendas\M050214\S0502142D.doc Financial and/or Resource Considerations The City and other local taxing districts forgo revenue when property is exempted from taxes. This project proposes new construction on a property that has been vacant for many years and in public ownership. During that time it was not on the tax rolls; therefore, there is no loss of revenue. New revenue will immediately occur because the land will be taxed during the exemption period. The improvements will bring substantial revenue after ten years. Timing These extensions are critical if this project is to proceed. The applicant's proposed financing is contingent on the exemption for the viability of the proposal. RELATED CITY POLICIES MUPTE is enabled by State statute. The City of Eugene has participated in the MUPTE program since 1978. Since that time, eleven requests have been approved. Encouraging housing in the core area is consistent with numerous adopted planning documents. Examples include: The Downtown Plan Policy V. 1 Stimulate multi-unit housing in the downtown core and on the edges of downtown for a variety of income levels and ownership housing. (The Tate is not inside the Downtown Plan boundary but is on the edge, five blocks from the intersection of Broadway and Willamette.) Growth Management Policies Policy 1 Support the existing Eugene Urban Growth Boundary by taking actions to increase density and use on existing vacant land and under-used land within the boundary more efficiently. Policy 2 Encourage in-fill, mixed-use, redevelopment, and higher density development. Policy 3 Encourage a mix of business and residential uses downtown using incentives and zoning. Jefferson/Far West Refinement Plan (The Tate is in this area) Residential 2.0 Increase the opportunity for home ownership within the area Residential 3.0 Encourage a mixture of housing densities and types to allow a diverse population group to live within the area. COUNCIL OPTIONS The council may approve or deny the extension. CITY MANAGER'S RECOMMENDATION The City Manager recommends approving the resolution to grant the extension. L:\CMO\2005 Council Agendas\M050214\S0502142D.doc SUGGESTED MOTION Move to adopt Resolution 4825 extending the completion date for construction of residential units granted a Multiple-Unit Property Tax Exemption under Resolution No. 4815 (1375 Olive, LLC). ATTACHMENTS A. Resolution FOR MORE INFORMATION Staff Contact: Richie Weinman Telephone: 682-5533 Staff E-Mail: richie.d.weinman~ci.eugene.or.us L:\CMO\2005 Council Agendas\M050214\S0502142D.doc ATTACHMENT A RESOLUTION NO. A RESOLUTION EXTENDING THE COMPLETION DATE FOR CONSTRUCTION OF RESIDENTIAL UNITS GRANTED A MULTIPLE- UNIT PROPERTY TAX EXEMPTION UNDER RESOLUTION NO. 4815. (1375 OLIVE, LLC). The City Council of the City of Eugene finds that: A. On November 22, 2004, the City Council adopted Resolution No. 4815 approving a multiple-unit property tax exemption for the construction of residential units at 1375 Olive Street, Eugene, Oregon. That Resolution required construction to be completed by January 1, 2006. B. Subsection (5) of Section 2.947 of the Eugene Code, 1971 authorizes the Council to extend the deadline for completion of construction of multiple-unit housing for an additional 12 consecutive months if it finds that the failure to complete construction by the time specified in the resolution approving the tax exemption was due to circumstances beyond the control of the owner, and that the owner had been acting in good faith and with due diligence. C. Although the property owner, 1375 Olive, LLC, expects to begin construction in February of 2005, it has advised that it is not likely that construction of the residential units can be completed by January 1, 2006, and has requested an extension to January 1, 2007. The Council finds that the property owner has been acting in good faith and with due diligence, and the inability to meet the January 1, 2006 construction deadline is due to circumstances beyond its control. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EUGENE, a Municipal Corporation of the State of Oregon, as follows: Section 1. Based on the above findings which are adopted, 1375 Olive, LLC is granted an extension to January 1, 2007, in which to complete construction of the residential units for which a property tax exemption was granted under Resolution No. 4815 on November 22, 2004. Section 2. The City Recorder is requested to forward a copy of this Resolution to 1375 Olive, LLC, and to append a copy of this Resolution to Resolution No. 4815. Section 3. This Resolution shall become effective immediately upon its adoption. The foregoing Resolution adopted and effective the __ day of ., 2005. City Recorder Resolution L:\CMO\2005 Council Agendas\M050214\S0502142D-attA.doc