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HomeMy WebLinkAbout06/26/1989 Meeting e M I NUT E S Eugene City Council Dinner/Work Session Eugene Community Conference Center June 26, 1989 5:30 p.m. COUNCILORS PRESENT: Ruth Bascom, Shawn Boles, Debra Ehrman, Bobby Green, Freeman Holmer, Emily Schue. COUNCILORS ABSENT: Roger Rutan. The adjourned meeting of June 21, 1989, of the Eugene City Council was called to order by Council President Ruth Bascom. 1. MODIFICATIONS TO THE BUSINESS DEVELOPMENT FUND Mike Sullivan, Planning and Development Department, gave the staff report. He said that on May 23, 1989, the Community Development Committee (CDC) recommended modifications to the Business Development Fund (BDF). These e modifications address legal problems with the City's Targeted Business Assistance Program (TSAP) arising out of recent Supreme Court revisions regarding minority set-aside programs. Mr. Sullivan said the Council Committee on Economic Diversification (CCED) has reviewed these modifications and recommended their approval by the full council. Mr. Sullivan reviewed the proposed modifications to the BDF which include: expansion of the Loan Advisory Committee to enhance the representation of minority, disabled, and female head-of-household borrowers; enhanced marketing efforts designed to reach diverse community groups; staff sensitivity training; loan recipient sensitivity training; affirmative hiring by loan recipients; credit policy modifications to address the needs of businesses with extraordinary credit barriers; and the creation of a loan pool within the BDF to address the needs of businesses with extraordinary credit barriers. Mr. Sullivan stated that a number of credit policy modifications are included in the CDC's proposal. The BDF program is organized around preference criteria which are used in the analysis and approval of a loan application. Currently the preference criteria are project impact, project effectiveness, and project need. The proposal is to add an additional preference criteria called extraordinary credit barriers. An extraordinary credit barrier would be defined as an impediment to access to conventional credit arising from socioeconomic factors or traditional credit industry risk standards. Mr. Sullivan said that the goal of the BDF would also be broadened to recognize e MINUTES--City Council-- June 26, 1989 Page 1 Dinner/Work Session e the need to diversify business ownership in the community by addressing extraordinary credit barriers. Mr. Sullivan said that different policies will apply to businesses which are found to have extraordinary credit barriers. These businesses would be granted flexible credit policies which would provide far-ranging relief from conventional credit criteria, including decreased requirements for equity, bank participation, and collateral for the loans. These businesses would also be offered flexible financing methods, including a higher percentage of BDF financing, smaller loans, seed capital loans to new businesses, and flexible repayment terms. Finally, loan recipients who receive financing under the extraordinary credit barrier criteria would receive ongoing technical assistance. Mr. Sullivan said the CDC also recommended the creation of a distinct pool within the BDF to fund loans for businesses with extraordinary credit barriers. The funding level would be set at $255,000--the amount currently identified for the Targeted Business Assistance Program in the Three-Year Plan, pending reprogramming requests. Ms. Ehrman asked whether members of the loan advisory committee would also receive sensitivity training. She felt that this type of training would be appropriate for committee members as well as staff. Mr. Boles thought that the CDC had intended to give sensitivity training to both groups. Mr. Green asked if those who seek loans to expand their business, rather than e to start a new business, could be exempted from technical assistance and training. Mr. Sullivan said most applicants are seeking loans for expansion of their business. He explained that the CDC felt loan recipients should receive training to assist businesses in their development. This is particularly important because the loans will be granted under conditions of greater risk; the training is viewed as a means of sheltering the BDF from this increased risk. Mr. Green inquired about the interest rates on the loans granted under the extraordinary credit barrier criteria. Mr. Sullivan said that if the applicant is borrowing 25 percent or less of the funds that he/she needs, the interest rate will be 6 percent. If the applicant is borrowing more than 25 percent, the interest rate will be 10 percent. Mr. Sullivan said that HUD has informed staff that its interest rate should be based on the ability of the business to pay, rather than on a fixed rate. He said that staff will begin working on restructuring the City's interest-rate policy soon. Mr. Bennett thought that expansion of the loan advisory committee membership is a good idea, but that the criteria for loan approval should not be changed. Mr. Bennett said that if the committee is expanded to include more representative membership, then it should not be necessary to change the loan criteria. Mr. Sullivan explained that the only criteria that will change are the preference criteria; these criteria will be expanded to include an analysis of whether the applicant faces extraordinary credit barriers. Mr. e MINUTES--City Council-- June 26, 1989 Page 2 Dinner/Work Session e Boles added that the criteria for judging the quality of the applicant's plan and their product will not change under this proposal. With regard to the modification requiring loan recipients to use affirmative hiring practices, Mr. Bennett argued that business persons who qualify for these loans are already sensitive to issues of affirmative hiring. He emphasized that letting these businesses select their own employees will be an important key to their success. Mr. Boles stressed that the affirmative hiring requirement will apply to all loan recipients in the BDF, not just to those who are found to face extraordinary credit barriers. II. AUTHORITY TO SET LAND USE FEES--CODE REVISION Tony Mounts, Finance Division, gave the staff report. He said that in August 1987, council adopted Ordinance No. 19494 amending Section 2.020 of the City Code delegating to the City Manager the authority to set certain fees. At the time of adoption it was known that numerous sections of the code would need to be amended to conform with the intent of the ordinance. It was agreed that sections of the code would be amended as fees were updated. Mr. Mounts said the Planning and Development Department has updated its fees and would like to use the administrative procedure to complete their adjustment. Sections of the code dealing with the setting of land use application fees need to be changed. Mr. Holmer asked whether staff salaries had really increased by 17 percent e over the past three fiscal'years. Assistant City Manager Dave Whitlow said annual merit raises for City employees accounts for some of the increase, as does the cost of living adjustment in wages. He assured councilors that the base pay of these employees has not increased by 17 percent over the past three years. Ms. Ehrman suggested that this statement be either deleted or explained. Mr. Holmer asked whether the City's fee level acts as a deterrent to economic development in the area. Abe Farkas, Director of Planning and Development Department, said the fees have not been a deterrent to economic development. He noted that while the City's fees may be higher than some other jurisdictions, the City's staff is more responsive to the needs of the developer. Mr. Boles asked how much the City is recovering of the actual costs of processing land use applications. Hillary Kittleson, Department of Planning and Development, said that by council policy, the City recovers approximately 21 percent of its costs. She said the proposed fee increases maintain this level of recovery. Mr. Whitlow added that the council can choose to change this level of fee recovery. Mr. Bennett thought that the City's fees should be based on a policy of recovering no less than 20 percent, but more than this when the market would permit a higher recovery rate. Mr. Boles agreed. e MINUTES--City Council-- June 26, 1989 Page 3 Dinner/Work Session e Ms. Schue thought that this method of recovering fees would be purely arbitrary and hard to justify. She felt that the recovery rate should be based on a fixed percentage of the costs to process a land use application. Mr. Mounts pointed out that the ordinance states that the City Manager should consider several factors when setting fees, including applicable policies, the amount charged by the City in the past, the full cost of providing the service, and amounts charged by comparable jurisdictions. He felt that this was flexible enough to allow staff to make the type of assessment suggested by Mr. Bennet~ with direction from the council. Councilors directed staff to reassess the proposed fees, looking closely at comparisons between the City's rates and those set by other jurisdictions, while recovering at least 21 percent of its actual costs. III. PROPOSED ORDINANCE CONCERNING SKATEBOARD RIDING Jan Bohman, Planning and Development Department, gave the staff report. She said the proposed ordinance would prohibit skateboard riding on downtown sidewalks in the area from Charnel ton to Oak, and 8th Avenue and Willamette Avenue, and between 6th Avenue and 8th Avenue on Willamette Street, in multi-level parking structures, and within ten feet of three bus transfer stations. The proposed ordinance also defines the offense of unsafe operation of a skateboard on the sidewalk for other areas of the city. Ms. Bohman said this definition is parallel to the definition of unsafe operation of a bicycle on a sidewalk. She said the skateboarding issue has been raised e by complaints from citizens about damage to property, conflicts with pedestrians, and reckless behavior by skateboarders. Ms. Bohman stated that at an earlier public hearing on this issue, several people commented on the need for a skateboard recreation area. She said this issue is being addressed through the Parks and Recreation Master Plan, which includes a policy that a task force be formed to determine whether there is sufficient need for a skateboard recreational facility, and if so, to look at the feasibility of constructing such a facility. Mr. Green stated that there is a clear need for a skateboard recreation facility. He felt the task force should begin immediately working on the question of feasibility. Mr. Bennett agreed. Ms. Bohman suggested that Mr. Green raise this issue at the council's hearing on the Parks and Recreation Master Plan. Mr. Boles thought it would be best if the council delayed adoption of this ordinance until it provides a skateboard facility. With regard to Item 2(c) of Section 1 of the ordinance, Mr. Boles suggested that the references to specific bus transfer stations be eliminated, so that the Item would read, "Within ten feet of any bus transfer station." Mr. Boles pointed out that the bus transfer stations may be relocated, and if this occurs, it would necessitate a change in the ordinance. Other councilors agreed with this suggestion. e MINUTES--City Council-- June 26, 1989 Page 4 Dinner/Work Session e The meeting adjourned at 7 p.m. Respectful y submitt~ ~~, .. Mich al Gleason, City Manager (Recorded by Tanya Northman) MNCC 062689-530 e e MINUTES--City Council-- June 26, 1989 Page 5 Dinner/Work Session