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HomeMy WebLinkAbout09/12/1988 Meeting (2) e M I NUT E S City Council Work Session 8J's Restaurant, 7th Avenue, Eugene September 12, 1988 5:30 p.m. COUNCILORS PRESENT: Cynthia Wooten, Ruth Bascom, Freeman Holmer, Emily Schue, Roger Rutan, Rob Bennett, Debra Ehrman, Jeff Mi 11 er. Mayor Obie opened the meeting at 5:32 p,m. I. BACKGROUND At the August 10 work session, the council selected an expansion option for consideration to be included in the renewal plan update. Council instructed staff to further analyze the area with regard to how urban renewal can help connect the areas of downtown, north of the railroad tracks, and the EWEB plaza. Staff was also directed to analyze the development potential of the e area and to examine the possibility of eliminating certain developed proper- ties as well as adding other parcels. This work session is to continue the review of the renewal plan update with a discussion of the 5th Avenue area. II. INTRODUCTION Community Development Division Manager Bob Hibschman reviewed the existing conditions of the area and displayed maps which showed the building condi- tions, the improvement value to land value ratio, vacant land areas, and the variety of zoning in the area. Mr. Holmer said he would be interested in seeing a map for the land ratio within the present central project. Mr. Hibschman said the Downtown Plan, when formulated, addressed conditions in the 5th Avenue and the core areas and focused on the value of linkages that can be provided between downtown, 5th Avenue, Skinner Butte, and the river. He said north Willamette Street is an important connection at the central core and is a terminus at the railroad station. He said the Downtown Plan also discussed the importance of streetlights and tree treatment in the 5th Avenue area. He said a portion of 5th Avenue is a special district area that encourages reuse of existing buildings and flexibility on how parking ar- e MINUTES--City Council Work Session September 12, 1988 Page 1 rangements can be made. He said there are also provisions for property e owners associations and an emphasis on owner-sponsored pedestrian improve- ments in the area. Mr. Hibschman said the Central Area Transportation Study (CATS) examined parking demand and supply in the downtown area. Two possible locations are identified in and near the 5th Avenue area--one is a subterranean location at 6th Avenue between Oak and Pearl streets which was originally designed to accommodate three or four more floors, and the other is a garage at the intersection of 5th Avenue and Pearl Street. Mr. Hibschman said the real question is what can the renewal tools do to improve this area? Linkages are a major answer. Staff proposes improving the streetscape, pedestrian areas, trees, and lights in order to provide continuity with the rest of downtown and to improve the atmosphere, particu- larly for nightlife. The Willamette terminus will undergo entrance beautifi- cation and ongoing improvements will be made on the south side of 5th Avenue to complement work already done on the north side. Parking would be the most important thing that renewal tools do to improve this area. It will make it easier for private property owners to develop their property. Renewal loan programs could be extended to encourage tenant improvements and improvements to building facades. Responding to Mr. Holmer1s query, Mr. Hibschman said that the current geographical limitations on the loan program are within the central boundaries. At this point, Mayor Obie decided to remove himself from the 5th Avenue discussions due to a possible conflict of interest. He turned control of the e meeting over to Council President Wooten. City Manager Mike Gleason said that parking facilities are the equalizer in an urban renewal district. Ms. Schue asked staff if there will be enough new development to generate enough additional tax increments to provide the parking. Mr. Hibschman said a generalized development model was used to examine potential increment revenue. He said it is going to take resources from the existing renewal district to address initial parking requirements in the new area. He said that, in theory, the old area will initially subsidize the new to pay for the parking. Mr. Gleason said the first question that needs to be addressed regards wheth- er parking is integral to the structure or will be free-standing, and the second question is whether parking structures will be built in conjunction with buildings which should typically be above five floors. Ms. Ehrman asked if the building would be exempt from increment if another four floors were added. Mr. Gleason said that would depend on how it is structured, because if the parking was part of the development and the devel- oper manages and leases it, there would be an income cash flow, but if the City builds it, then the public would get no increment flow. Responding to Ms. Ehrman1s follow-up question, Mr. Gleason said the County has no plans for expansion at this time. e MINUTES--City Council Work Session September 12, 1988 Page 2 Mr. Bennett said he was interested in getting away from the concept of free e parking because it is not really free. Mr. Gleason said that $35 is about the break-even point if taxes and operations have to be paid. Mr. Hibschman said the Overpark has to get $70 for every space to cover the operating costs that include debt service. Mr. Holmer asked about the cost if there was debt service but no taxes. Mr. Gleason said about $65. Mr. Bennett said he would like to see some more numbers on that. Ms. Wooten agreed that it is neces- sary to get away from free parking. Mr. Bennett said a number of retailers have expressed an interest in getting away from free parking and were con- cerned on what ideas there were for transition. Ms. Ehrman said there was no consensus on the Downtown Development District Review Group but they felt it might be time for the City Council to examine the issue. She said it seems to her that a small group is being taxed to benefit the whole city. Ms. Wooten asked about reactions from individual property owners. Mr. Hibschman said that parking seems to be the major concern. Mr. Holmer asked if there are any disadvantages to creating a new urban renewal district instead of expanding the present one. Mr. Hibschman said the main advantage in expanding is to have access to the resources of the established area. Otherwise, he said, the new area would be slow to generate increment like the Riverfront Research Park. Mr. Gleason said there would be a problem with including land already used because of displacement of exist- 'ing parking. If the district is expanded, then that tool would be used to develop parking in the surrounding boundaries. Mr. Bennett said that where new parking structures were located would make a big difference. He said a five-story structure could block the view and the e connecting route and will therefore create separation. He said part of the goal of expansion should be to invite people into downtown. Pat Decker said the five-story example cited earlier was based on a mixed-use area. She said that scale issues could be addressed and the City can talk with property owners that have parking problems. Mr. Gleason said it takes something above three stories to have enough increment flow to pay for replacement and new parking. Mr. Miller asked what kind of increment would be thrown off if a project under development is included. Mr. Hibschman said that every year, on January 1, the assessor determines the value, so a construction project would be assessed at that time. Therefore, the increment would theoretically be seen by the next fall. Mr. Miller said that it may then be better to move now. Mr. Gleason noted that the increment can only be captured if the dis- trict is in place there. Ms. Bascom asked if it would be better to separate the district if there are some projects waiting in the wings. Mr. Gleason said that if you want a high-density area with buildings above three stories, parking must be provided and the public must invest in the parking. He said that any existing cash flow out of the existing district must be focused on parking in that boundary, Mr. Rutan said what the council is trying to accomplish is to see if there are any opportunities to use urban renewal tools to help development occur in this area. He said the bottom line is to provide public parking facilities that would not occur on their own. Assuming these tools work, he said, then property can be brought into the urban renewal district as demand occurs. He asked if there is a way to have the mechanics in place and then incorporate e MINUTES--City Council Work Session September 12, 1988 Page 3 them when growth occurs. He said it seems impossible to speculate on what e future development there might be. Ms. Wooten declared that the City cannot be that flexible because it would end up with no plan and such a scheme would not be cost-effective. Mr. Rutan said the City could expand the area but not officially put it into place, so it could be quickly implemented as soon as it is needed. Mr. Holmer said he sees a lot of two-story development in the Central Eugene Project; he said he is not sure there is enough development to add 20 percent to the district. Ms. Schue said the City seems to have lost track of its original intentions. She said she thought the original understanding was not to invest in a new area until there is enough interest to pay for it. Mr. Miller asked if the City Council wants to give vision and leadership to help development capture the urban renewal increments. He said it seems prudent to plan about bring- ing the area into the district and take advantage as Eugene looks at expand- ing the downtown area. Ms. Bascom said there are areas right for development around the Oregon Electric Station and the train station. Ms. Wooten said she would like to add the quarter-block south of the alley between Pearl and High streets to the area. Ms, Ehrman said the Grower1s Market west of the train station on Willamette Street could also be added. She suggested that the half-block of the County parking lot and maybe the State office building be omitted. Mr. Gleason said the State is committed to the Portland project 'first, but he always assumed that government service is a key component of Eugene.s service area. Mayor Obie asked if the State gets a tax offset even if private developers develop the area. Mr. Gleason responded that it would depend on how the deal is structured. Ms. Wooten asked if the model included a new State building within the district. Mr. Hibschman said the model was a e generic one. He said another thing to consider is the potential expansion of the Hilton Hotel, which was originally designed to add 100 rooms. Mr. Bennett said that the East Broadway area has development that is occur- ring without City help, through natural market forces. Mr. Rutan said it is also important to remember the role of City government. He said urban renew- al expansion is to facilitate this but it must be remembered that the economy is poor in this area and the council cannot do anything to change that. He said the City should have a district and a program to respond when things begin to happen. Mr. Holmer asked if the new Centennial Bank was planned without City help. Mr. Gleason said the bank decided on the location inde- pendent of the City. Ms. Wooten summarized some of the council.s views thus far. She said the council would like to have more clear, concise calculations on increment values and finances of an independent free-standing structure not located at 5th Avenue and Pearl Street. She said the council wants to examine its commitment to the central core area, the possibility of phased pay parking, and the reasons for not having a new urban renewal district. Ms. Wooten said that Ms. Ehrman would like to drop the half-block of the County lot from the area and Ms. Wooten herself would like to add the quarter-block between Pearl and High streets, The council also requested more information on how to construct a plan without final approval to allow for more flexibility. e MINUTES--City Council Work Session September 12, 1988 Page 4 At this point, Ms. Wooten asked for summary views from councilors on this e particular configuration. Ms. Bascom said she is not ready to embrace this area and would like to have more discussion. Ms. Schue said she has mixed feelings, She said she was not sure that parking was a crisis at this time and noted that things are happening now without urban renewal. She said she would rather see the unused property in the current district developed and is not sure if the 5th Avenue area needs urban renewal to keep present development going. Mr. Gleason said that once the density is above two floors, there will be a need for more parking. He said that any surplus parking would allow for entrepre- neurial spin-offs and would prevent choking out that entrepreneurial spirit. Ms. Ehrman said that she is interested in dropping and adding the above-men- tioned blocks and is also interested in parking concerns. Mr. Miller said he favors the northeast expansion and he is not closed to having a separate district, but he is concerned with the time frame and the lag time that would not allow the City to act when it is necessary. Mr. Rutan said that an urban renewal district is not going to create development. He said it is nice to look ahead but it is going to be the private side economics that will create development. Ms. Wooten said the Downtown Commission initially reviewed opportunities for the urban renewal plan and expressed interest and concern in blighted areas. Ms. Wooten said there is the possibility that the matter "be tabled due to lack of interest. She said she thinks that the north and the east are ready to go with some facilitation and words of encouragement from the City. She said this may not happen yet, but it may be a way to expand without turning our backs on the core area. e Ms. Wooten asked how many of the councilors would be generally interested in phased pay parking programs. Ms. Ehrman said the parking would pay for itself if administration, public safety, and marketing were not added. Ms. Bascom said she would like to hear from the retailers. The council expressed a consensus interest in the topic. Mr. Bennett said the transition to paid parking is necessary because free parking is based on the assumption that traditional retail could be done downtown, but the new type of multi-tenant, mixed use, specialty shops lend themselves to paid parking. He said he is also excited about the movement to the north and the east, but he is not willing to forget about the central Eugene district. Mr. Holmer agreed that the north and the east are important but commitment must be kept to the central core. He said the north and east development will help the downtown area because specialty shopping appeals to people and will create and generate interest in the other areas as well. Mayor Obie asked if it would be useful to have a public hearing on the size and location of the district. Councilors agreed that a suitable working area should be determined first. Ms. Ehrman said she is intrigued by the idea of a separate district, yet she does not want to spend the central core money and not hold to the 20-percent limitation. Ms. Wooten asked if it is possible to initiate a third district. Mr. Rutan remarked that the council has always shied away from special dis- tricts and sees that as the same. e MINUTES--City Council Work Session September 12, 1988 Page 5 ---- . Ms. Bascom asked if the issue will be re-raised at the library financing meeting. Mr. Rutan asked if any increment will be realized from development of the library. Mr. Gleason said that would depend on use and how the deal is structured. Ms. Schue said that would reinforce the idea of keeping the two areas separate. She said she would like to hear from property owners. Mayor Obie asked if a new district would require approval of other taxpaying districts, such as the school district. Staff agreed to research this issue. Mr. Bennett asked if there are any cities where operating and maintenance costs are paid by the assessment district, and pay fees and the capital side are handled by something other than tax increments. Mr. Gleason said the possibilities are extensive, but the most prevalent model is to build the structures by having some increment of the bUilding paid for out of the leases. Ms. Wooten said she would be interested in getting a report on centralized retail management. Mr. Bennett said he would report to the council. The meeting was recessed at 7:15 p.m. Respectfully submitted, "".," ... . . ~~ , .... '_'___.. ~~., __~..1 Micheal D. Gleason City Manager e (Recorded by Johnny Makosky) mncc 091288-530 e MINUTES--City Council Work Session September 12, 1988 Page 6