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HomeMy WebLinkAbout11/01/1978 Meeting . MINUTES - EUGENE CITY COUNCIL November 1, 1978 -_..~-- - -- -- -- - -.---- --------. - - - - - - --~- - . -- -- "-.--- -~ Adjourned meeting from October 25, 1978, of the City Council of the City of Eugene, Oregon, was called to order by His Honor Mayor Gus Keller at 11:30 a.m., November 1, 1978, King's Table, Oakway Mall, with the following Councilors present: D.W. Hamel, Jack Delay, Scott Lieuallen, Brian Obie, and Betty Smith. Coucilors Eric Haws, Ray Bradley, and Tom Williams were absent. - I. Items from Mayor and Council A. Scobert Litigation:--Mr. Obie referred to a recent letter from Jack Billings. Mr. Obie had met with Mr. Scobert, who does not wish to sell his property, but wishes to develop it with low-cost housing. In 1977, Council had authorized to proceed with condemnation of the property. Mr. Obie felt it might be more fair to withdraw approval of the condemnation. Assistant Manager said staff had discussed with City Attorney's Office the course of action in the area of surveys. It was felt the - property's description was valid as outlined in the February letter. Subsequently, surveys found an error. At first, according to the surveys, it appeared the City was proposing to purchase only vacant property. The subsequent survey showed the property included five feet of an existing building. Given the lack of land for parks, the neighborhood group and Parks Department still strongly recommend the matter be pursued. However, before that, Council will be asked to readopt the resolution for condemnation procedures. All interested parties will be notified prior to Council's action. Assistant Manager also noted Mr. Scobert's representation of development on the property was probably misrepre- sented. It was highly improbable he could develop it as he wanted. In response to a question from Ms. Smith, Ed Smith, Parks Director, said the issue never came before the Joint Parks Committee. Rather, it went through the Community Development and neighborhood review processe,s. Mr. Obie felt the main issue was that Mr. Scobert had been waiting for some time for resolution of the problem, and does not want to sell the property. Since the City had initiated the transaction, he felt it only fair that the City proceed as quickly as possible to resolve it. e 11/1/78--1 ;oq ., It was consensus that the issue would be scheduled for public hearing Monday, November 27, 1978, with all interested parties - not ifi ed. B. Mayor's Absence from City--Mayor Keller will be out of the office Monday, November 6 and Wednesday, November 8. C. Budget Subcommittee--Mayor again requested those Councilors interested in serving to notify him before next week. D. Downtown Development Board--Neal Sande has resigned and Mayor Keller appointed Chuck Wickizer, 1220 Oak Way Road to fill the unexpired term ending January 1, 1981. E. Community Schools Coordinating Committee--Mayor Keller noted a second resignation. He requested Council hold its approval for both appoint- ~ ments to November 8. F. Economic Improvement Commission Meeting--Wednesday, November 1, Harris Hall, an organization meeting for Lane County. G. Community Goals Conference--Thursday, November 2, 7:30 p.m., Council Chambers. H. Council Appointments to Various Committees--Mayor Keller requested Councilors please notify him regarding their interests in serving on committees prior to the new Councilors' assignments later this year. - I. Room Tax Committee Meeting--Wednesday, November 8, 4 p.m., Mayor's office. II. Routine Items for Council Approval A. Council Minutes October 25, 1978 Mr. Hamel moved, seconded by Mr. Delay, to approve Council minutes October 25, 1978. Motion carried unanimously. B. Wrecker's License: Sessler, Inc., 111 Highway 99N; owner, Ray Sessler Mr. Hamel moved, seconded by Mr. Delay, to approve wrecker's license. Motion carried unanimously. c. Adoption of Ambulance Rates Manager noted the resolution would be retroactive to October 5 when Council approved the increase in rates. Res. No. 3034--Concerning rates for ambulances and mobilechairs; amending Res. No. 2742 adopted September 26, 1977, was read by number and title. e 11/1/78--2 110 Mr. Hamel moved, seconded by Mr. Delay, to adopt the - resolution. Motion carried with all Councilors present voting aye, except Mr. Delay voting no. D. Calling Public Hearings December 20, 1978, re: All ey, Street, Easement Vacations '- CB 1782--Calling public hearing December 20, 1978 re: Alley vacation located between Willamette Street and Olive Street, north from West 16th Avenue, and retaining public utility easement over entire area (Suchy)(AV 78-1), was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18290. CB 1783--Calling public hearing December 20, 1978 re: Street vacat ion located north of West 34th Avenue, west of Chambers Street e and retaining public utility easement over entire area (Dixon)(SV 78-3), was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Ro 11 ca 11 vote. All Councilors present voting aye, the bill was declared passed and numbered 18291. CB 1784--Calling public hearing December 20, 1978 re: Public utility easement vacation located north of Myer Road, approximately 400 feet west of Gilham Road (Baitis)(EV 78-8), was read by council bill ~umber and title only, there being no Councilor present request i ng it be read in fu 11 . Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. e 11/1/78--3 ill Motion carried unanimously and the bill was read the second time by council bill number only. - Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18292. CB 1785--Calling public hearing December 20, 1978 re: Public utility easement vacation located on east side of Onyx Street approx- imately 100 feet north of East 35th Avenue (Mott) (EV 78-11), was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18293. CB 1786--Calling p~blic hearing December 20, 1978 re: Street ease- ment vacation located south of Sweetbriar Lane, east of East e 43rd Avenue, retaining seven-foot public utility easement (Stimac)(EV 78-12), was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18294. CB 1787--Calling public hearing December 6, 1978 re: Public utility easement vacation located near the terminus of Agate Street, south of East 27th Avenue (Thomas)(EV 78-10) and repealing Ordinance No. 18277, was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous e 11/1/78--4 'I~ consent of the Council, and that enactment be considered at e this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18295. E. Alley Vacation: Second and Final Reading (AI Art Enterprises) (AV 78-2) Manager noted receipt of money for alley vacation. CB 1780--Authorizing alley vacation located between East 14th Avenue and East 15th Avenue and from Oak Street west 160 feet to a north-south alley, was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18296. III. Awarding Bids for Civic Center and Bancroft Bond Sales e Sherm Flogstad, Finance Director, expressed pleasure with the results of the bids. The prevailing bond interest rate as of last Friday was 6.14 percent. However, the bi ds recei ved for the City sal es 'today were as follows: For the Civic Center, there were seven bids received with the low bid from the John Nuveen & Co., Inc., Chicago, at 5.611 percent. For the Bancroft improvement bonds, three bids were received with the low bid from Bank of America at 5.3137 percent. Mr. Flogstad introduced Jim Bancroft with Bartle Wells, who prepared the bid prospectus. Res. No. 3035--Awarding sale of GO Bancroft Improvement Bonds Series E, in the principal amount of $2,120,000 to Bank of America at a net interest cost of $636,061.75, net effective interest rate of 5.3137 percent was read by number and title. Mr. Hamel moved, seconded by Mr. Lieuallen, to adopt the resolution. Roll call vote. Motion carried unanimously. Res. No. 3036--Awarding sale of General Obligation Civic Center bonds in the principal amount of $18,500,000 to John Nuveen & Co., Inc., Chicago, at a net interest cost of $13,427,355, net effective interest rate of 5.611 percent was read by number and title. e 11/1/78--5 '13 I Mr. Hamel moved, seconded by Mr. Lieuallen, to adopt the resolution. Roll call vote. Motion carried unanimously. e IV. Consideration of Code Amendment re: Small Animal Clinics (CA 78-2) Unnanimously recommended by Planning Commission September 11, 1978. Jim Saul, Planner, said this was a routine amendment initiated by the Planning Commission to clarify an ambiguity in the Code. It more clearly defines a small animal clinic. The present Code definition makes no distinction between boarding not directly related to basic veterinary service, and boarding necessary for post-surgical observation. The amendment would add wording to allow emergency and post-operative over- night care of animals in small animal clinics. Public hearing was opened. Duwayne Penfold, 725 East 25th, noted the problems in the past with the tenn "boarding." He said there was a nation-wide discrepancy between hospitalization and boarding. Hospitalization is know as a service that is necessary because of intensive care given to patients. Boardi ng is confinement of a patient for the convenience of the owner. He said the amendment would help to clarify that definition. Public hearing was closed, there being no further testimony presented. Manager noted the amendment is an addition to the present Code, adding e the words "except that which is ancillary to veterinary service, such as overnight medical, emergency, or post-surgical observation." He said it related only to the definition of small animal clinics. CB 1788--Concerning definition of Small Animal Clinics; amending Section 9.254 of Code, 1971, was read by council bill number and title only, there being no Councilor present requesting it be read in full. Mr. Hamel moved, seconded by Mr. Delay, that the bill be read the second time by council bill number only, with unanimous consent of the Council, and that enactment be considered at this time. Motion carried unanimously and the bill was read the second time by council bill number only. Mr. Hamel moved, seconded by Mr. Delay, that the bill be approved and given final passage. Roll call vote. All Councilors present voting aye, the bill was declared passed and numbered 18297. v. Authorization of Sale of City-Owner Property--Memo distributed Manager said the property was acquired when Monroe Park was expanded. The house was moved to 1442 West 11th. e 11/1/78--6 lilt Charles Kupper, HCC Director, said this property was one of three prop- e erties on the Monroe Park site which was being developed with CD funds. In July 1977, when the park was to be constructed, it was decided the property should not be torn down, noting the CD policy not to demolish property. Bids were requested, with two successful bids for two pieces of property. The third property was much larger, and bids were not received to remove it. In cooperation with the Westside Community, it was decided to use CD funds to remove and refurbish the house, with the condition that it be sold to a family in the low/moderate-income range, the money to be recaptured from the sale and recycled to the Westside neighborhood. He said four goals from the Community Development and neighborhood had entered into this decision: 1) To retain the structure; 2) to accommodate moving the house as it was compatible with the neighborhood; 3) to sell it to a single-family owner/occupant at a price in the low/medium-income group; and 4) to recapture City money and recycle into the Westside program. Paul Osborn, HCC, reviewed the memo distributed to Council regarding the method of sale. The goal .would be to recover as much of the money as possible as quickly as possible. The proposed process would have three lien agreements: 1) From a commercial lender, probably between $20,000 and $28,000; 2) a rehabilitation revolving loan, carrying the difference between the first debt and the cash investment ($48,000); and 3) the rehabilitation revolving loan fund would carry the difference between the e investment ($48,000) and the appraised value ($58,500). The payment on the third debt would be deferred as long as the buyer owns and occupies the house. When the buyer moves or sells, the entire balance would become due. He noted that since it was hoped to sell the house to a family of low- to medium-income, it was necessary to keep the monthly payment down to 25 to 35 percent of the family's gross monthly income. This particular funding process would allow the payments to be approximately $403 per month. He said lenders indicated they would prefer a five-percent down payment which would be in the neighborhood of $3,000. Another option would be for the City to sellon a land sales contract with no down payment. The house would be open for a two- to three-week period with advertising. Applications would be taken with a drawing of ten names. That list would be used to select a qualified buyer. He said the second loan agreement would carry an interest rate of three percent, with the third loan agreement carrying none. Mr. Hamel wondered what sort of insurance the City might have to control the second ownership, that the single-family residence would not be sold and used as a rental. Mr. Osborn said there was no method of assuring the buyer would stay for any length of time. The major concern was the City getting a return on its investment. He said, however, there was some discussion that the third lien might be a disappearing one, in that $50 per month he reduced to encourage the buyer to stay. That suggestion was dropped, as there were some problems regarding taxing income. e 11/1/78--7 "5 I Mr. Delay, a member of the CDC, felt this was a workable solution to address the goals of the CD Act and the neighborhood. He said this e was a unique situation. Mr. Osborn noted that under the Westside NIP, there is a land banking program. He said the land now in the program is all vacant, but there will be disposal of other properties some time in the future. However, he noted, this was would not be high-volume business. Steve Wood, 271 West 10th Avenue, representing the Westside NIP, said the group was supportive of the staff's proposal and hoped Council would approve. Mr. Obie agreed in concept with the proposal. However, he felt the house did cost more than needed, and perhaps could have been developed in a manner that would allow a lower-income family to occupy it. He hoped the City would not get into a great deal of this type of business. He was also concerned regarding no down payment, noting that a down-payment requirement would attract a permanent resident and show the credibility of the buyer. He did not agree with the policy of subsidizing the interest rate on the second loan. He felt the City should get at least the same amount of money back as it has to borrow and should not subsidize interest. He also felt the City should share in the increase in market value or collect some sort of interest for the third loan. Mr. Delay said the CDC had had considerable discussion regarding the down payment. There would be closing costs so the buyer would need some money e up front. It was also noted the family probably would have little savings for front-end costs. He felt the plan as presented could accommodate Mr. Obie's concerns regarding the down payment. Mr. Osborn had also said the three-percent interest on the second loan was an attempt to stay within the 25- to 30-percent gross monthly income of the family. However, he noted that the loan term could be extended to keep the payment down. In regard to no interest on the third loan, he said this was an attempt to find some method of encouraging an owner/occupant status, and this could be that incentive. Mayor Keller wondered whether the City was in the business of creating an opportunity without protecting the public's best interest. He won- dered if this proposal would really benefit the people the City wishes to have occupy this house. He said it appears a person could buy the home and see the opportunity to make a few dollars, and thus, sell the home. Mr. Delay responded that the proposal was an attempt to create an oppor- tunity for a family who would not be able to compete in the normal market for a single-family home. He said it was true that there might be some appreciation on the home, but the family would have to sacrifice by going back into the normal homeownership market and that might be more of a burden than'the family could bear. Mr. Delay suggested that perhaps staff could bring back a proposal for mechanisms to discourage premature resale. e 11/1/78--8 11~ , Mr. Lieuallen felt the Council IS only concern should be whether or not e the City was going to sell the house. If Council were to add penalties for premature sale, and the buyer decided to sell, the City would then still hold a piece of the property. He could not understand the reason for. this. He said it seemed the question was either the City was going to sell or it wasn1t. In regard to Mr. Obiels concern of the $10,500 increase by market appraisal, Mr. Lieuallen said that is not money the City has paid out, and the CD Committee is not in the business of making money. He felt the rate of return on the $10,500 was not that critical. If the City were in the business of making profits, then that might be a major concern. Mr. Delay said the Westside neighborhood wanted to ensure recovering the money and recycling it back into the neighborhood. He said that could have been done without the $10,500. However, in that would have left the situation more in the line of Mr. Obiels concern that the buyer would have even more appreciation occurring. The proposal was to ensure the $10,500, which is not out of the City.s pocket, would not be an incentive for speculation. It was noted that the City does offer very low interest rates, such as on 312 loans and private rehabilitation loans (at zero, 3, 5-1/4, and 7-1/4 percent) . Staff will respond November 8 as to whether continued subsidies can be avoided and whether or not some protective device can e be set up to avoid speculative buying. Mr. Hamel also requested staff respond on whether or not it should develop the other property referred to by Mr. Osborn. Mr. Hamel felt the CD funds were not meant for moving houses. A short recess was taken. VI. Ballot Measures 6 and 11: Effects on Bonding Programs; memo distributed Paget Engen said the emphasis would be on the effects of Ballot Measure 6, since Ballot Measure 11 did not have direct effect on the bonding, programs. She was relying on Attorney General opinions and other experts such as Regan, Roberts, and O.Scanlin. She noted all conclusions could be subject tolitigation,and might be different than the Attorney opinions she was now presenting. She said the main concern was the ability of the City to pledge unlimited faith and credit of the community to pay back bonds. Presently, the com- munity1s full faith and credit is pledged to do so. If Ballot Measure 6 were to pass, any future bonds that the City wished to issue would be limited tax bonds. It is not known what would happen to the market. Under Ballot Measure 6, General Obligation bonds, Bancroft bonds, serial levies, street and sewer improvement bonds would have three hurdles to pass: , 1. Is it legal to levy the bonds at all? . 11/1/78--9 '71' . I 2. Payment for that debt would have to come within the City's share of $15 per $1000 limitation. - 3. It would require two-thirds vote of the qualified electors (a question still remains as to what is meant by two-thirds). In regard to revenue bonds, she said the City has never issued them, but this would effect EWEB. However, neither ballot measure would jeopardize their legality. In regard to serial levies, a question is involved as to whether they are indebtedness in the sense that Ballot Measure 6 exempts prior indebtedness. Under Ballot Measure 6, tax is collected from existing approved serial levies and probably would be included in the City's portion of the $15 per $1000 maximum rate, unless an actual debt had already been incurred~ Future serial levies would probably be defined as special ad valorem taxes on real property and would be prohibited. There was also some question as to whether the Council would have any option as to whether or not it wanted to levy serial levies. Ballot Measure 6 would also affect tax increment funding. Because of the roll back of assessed values, it would reduce the urban renewal increment. The roll back of actual tax rates would also reduce the annual revenues available to urban renewal agencies. Ms. Engen then reviewed the effect of some of the public projects. She noted the Civic Center bonds would not be affected since they had been - sold today. However, she noted, future capital improvements under Ballot Measure 6 will have to be financed by some other means. Mayor Keller wondered about the hotel/convention center and whether it would still be possible to use tax increment funding. Mr. Kupper said under Ballot Measure 6 the potential revenues would decrease for any given development. Also, the national rating services have withdrawn the rating, making sale of bonds on a national market nearly impossible. He said only a few tax increment bonds were not being sold in California at 9 percent plus interest rates, as the rating had been withdrawn there too. Mr. Delay said it seemed new ways of financing would be needed for public improvements as well as consideration that use of the traditional ways will be more expensive for the City. Assistant Manager said there will continue to be a market for governmental securities, and the scarcity of those may drive interest rates down at some time in the future. Manager noted that at a recent leMA meeting, people from California were saying that in two years a revised Constitutional Amendment will be offered. The purpose would be to clarify and to allow cities to issue tax increment and GO improvement bonds. However, he noted in Oregon this would take four years as it could only be done at the general election in 1982. He also noted an increase in the levying of user and service charges in California. . 11/1/78--10 "8 . c Mayor Keller thanked Ms. Engen for her fine presentation on the ballot e measures. He felt it had contributed greatly to the Council's under- standing and hoped also to the community's understanding of the measures. VI I. Public Opinion Survey: Status Report--Report distributed Manager reviewed the top ten projects as a result of the survey, includ- ing concerns about the downtown mall, repair and maintenance of homes and yards, bus service, general traffic congestion and delay, request for more police patrol and protection, more retail or department stores down- town, and increased parking. He reviewed for Council the City.s response to some of these problems as outlined in the memorandum. Ms. Smith left the meeting. He then reviewed the survey response on the property tax question. In general, in November of 1977, the citizens of Eugene were reasonably satisfied with the services received; 66.8 percent felt taxes were about right, 17.5 percent felt taxes were too high, but 15.7 percent felt ser- vices were worth more than taxes. He said there might be some specula- tion as to reasons for taxpayers. attitudes to be changed from last year. First, California.s Proposition 13 has created a nation-wide momentum of hostility toward property taxes. Second, inflation is a major concern. Tax revolt is a new and current political fad which has opened possibilites for a means of securing more disposable income and e an opportunity to "shake up the system." He said it was impossible to know what the taxpayers feelings were regarding city taxes. It coul d be the revolt is directed toward other jurisdictions. The November 7 election may provide some partial answers, but is is difficult to predict the extent of hostility toward various jurisdictions. Agenda item for consideration for kiosks on the mall will be delayed to the November 8 meeting. VIII. Public Hearings Scheduled November 6, 1978 A. Rezoning from PL to R-1 Property Located South of 25th Avenue, West of Onyx Street (Eugene Lodge)(Z 78-23) B. Rezoning from R-l to R-2 Property Located South of 12th Avenue, between Hayes Street and Grant Street (Jonese)(Z 78-24) c. Rezoning from AG and RA to C-2 Property Located at Northeast Corner of River Avenue and River Road, south of Beltline Road (Lane Transit District)(Z 78-25) ~dU1Y made, seconded and passed, the meeting was adjourned. )~ Charles T. Henr City Manager e DT:er/CM27a1 11/1/78--11 11ft