Loading...
HomeMy WebLinkAboutCC Minutes - 05/26/09 Meeting M I N U T E S Eugene City Council Regular Meeting Council Chamber—Eugene City Hall 777 Pearl Street—Eugene, Oregon May 26, 2009 7:30 p.m. COUNCILORS PRESENT: Chris Pryor, George Brown, Andrea Ortiz, George Poling, Mike Clark, Alan Zelenka, Betty Taylor, Jennifer Solomon. Her Honor Mayor Kitty Piercy called the meeting of the Eugene City Council to order. 1. PUBLIC FORUM Mayor Piercy reviewed the rules of the Public Forum. Carol Berg-Caldwell , 2510 Augusta Street, expressed appreciation for the organizers of the Taser Town Hall. She also appreciated that councilors Brown and Ortiz had attended. She thought it had been a “great evening.” She was glad that Councilor Ortiz had undertaken “some outreach” to “groups who might want to continue the conversation” in the community. She reported that the people who attended the meeting had continued for a half- hour after the town hall’s scheduled end. She believed there would be more town halls like the one held on tasers. She had been especially touched by the testimony provided by Jeff Salisbury, father of a young man who had been shot in front of his home by a Eugene police officer who had responded to a call for help there. She thanked those who had attended. Eugene Drix , Ward 3, said he was there to inspire everyone. He read a short poem he had written about Eugene. He said he was there to give Eugene a brand. He related that he had been to England for two weeks. He averred that the people in the village he had visited were “pretty much like us.” He stated that he lived in the West University Neighborhood. He had spoken with some of the homeless people who lived in that area, who he called No-Adds because they had no addresses. He related that homeless people were worried about crime. He believed the community was in a “mess of need.” He reiterated that there were two holes downtown and said he would like to fill a hole with art. He added that the way to give homeless people integrity would be to provide them with bathrooms. He closed by declaring his love for Eugene. Kathryn Schmieding , 823 Crest Drive, Ward 2, stated that she had lived on Crest Drive for 61 years. She had been heartened to hear that it would be repaired, but she was greatly concerned over the method of assessment. She said as a senior on a limited income, it would be difficult to come up with the amount she was going to be assessed. She believed the cost should be divided up among all of the people who use the street, including those who reside on the cul de sacs that can only access their houses from Crest Drive. Jozef Siekiel-Zdzienicki , 1025 Taylor Street, Ward 1, asked if anyone knew who they should talk to th regarding the proposed West 11 Avenue corridor for the EmX. He wondered if the councilors knew how many times City staff had met with the Army Corps of Engineers (ACOE), the Lane Council of Government (LCOG) Metro Waterways Study Group and the Lane Transit District (LTD) regarding the possible enhancement and “reconfiguration” of Amazon Creek. He declared that it would take more than 60 days to “digest” the draft Environmental Impact Statement (EIS) for the project when it came out in January, unless a person was already knowledgeable about the subject. He recalled that an LTD representative had spoken MINUTES—Eugene City Council May 26, 2009 Page 1 Regular Meeting of transparency and public input when they had presented to the City Council several weeks earlier. He alleged that LTD “bristled” and “accused” him and his partner of inflammatory rhetoric for writing a letter to the editor. He asserted that he and his partner had the facts. He averred that the project had a “conjunction with the West Eugene Collaborative (WEC) plan” that would affect major portions of businesses, neighborhoods, natural environments, traffic patterns and lifestyles. He asked if it was not time for the council to be more involved and “a lot more informed.” Pauline Hutson , 1025 Taylor Street, opined that the LTD work plan presented to the City Council was “pure sales pitch.” She averred that they were the “little people” in the situation. She said they did not have money to put on presentations and public relations events. She felt they had no one else to turn to; the th councilors were their representatives. She thought that if the council chose the 7 Avenue route it would prevent a route being built along the Amazon Creek. She knew a woman who worked as a housekeeper for a living. She asserted that because this person’s bus route had been eliminated, she was now commuting two hours per day. Helen Reed , 3260 Storey Boulevard, stated that she had moved into her house the previous spring. She had been shocked by the amount of the assessment. She felt it was unfair and excessive. She had joined Bill Eddie and others in the neighborhood to gather signatures of remonstrance against the assessment. She noted that of all of the people she had spoken with, only one had supported the assessment. She said everyone she spoke with wanted the road improvements. She added that the people who had worked on the project felt especially strongly about moving forward with the improvements. Jeffrey S. Librett , 920 Crest Drive, also wanted to remonstrate. He favored having the work done, but the assessment seemed unreasonably and outrageously high to him. He averred that it was unaffordable. He related that he had an academic salary that was fixed. He noted that academics in the northwest made less than anyone else in academics in the nation and academics in the humanities made even less than that. He and his wife had put all of their money into the house, in buying it and renovating it. He said when they had bought it five years earlier, they had been told that they would not be charged more than $10,000 for potential assessments and that amount would be payable over a number of years. He stated that he would not have bought the house had he known what the assessment was going to be. He noted that he had two small children. He considered the assessments to be especially unfair, given that many people used the streets. He averred that the assessment policy was an outmoded law. Toby Gamberoni , 691 Crest Drive, Ward 2, wondered if they could not find a solution that would “harmonize the different interests” in the Crest Drive/Storey Boulevard/Friendly Street area. He believed the assessment policy could be shifted so that the assessments could fall on a wider range of residents. He reiterated that many people use the road, noting that the elementary school caused a great deal of traffic. He averred that making the few responsible for the many was not appropriate. He felt that the assessments should be shifted more toward equality and looking out for the “weakest on the team” who might not be able to pay. Zachary Vishanoff , Ward 3, provided a taser report he had written to “provide counterpoint.” He wanted the City to get tasers that included cameras because this would provide a better opportunity to determine if tasers were deployed reasonably. He noted his preference to have the tasers “gone altogether.” He read aloud some information regarding the “taser cam.” He added that Pete Kerns was a “good person to be a police chief.” He commended Acting Chief Kerns’ ability to communicate with the public. He opined that with what was going on currently, it was not “time to change the guard.” He added that he also liked Police Captain Steve Swenson for the same reason. He asked that his packet of materials be forwarded to the Civilian Review Board and the Human Rights Commission. MINUTES—Eugene City Council May 26, 2009 Page 2 Regular Meeting Bill Eddie , 830 Crest Drive, Ward 2, stated that 86 citizens had signed the petition remonstrating the Crest Drive project. He said the vast majority of the neighbors favored improving the road and understood the need to pay for them, but they believed the existing assessment policy to be unfair and unaffordable. He related that they were collectively asking the council to find a better way to fund the project and future projects in Eugene. He felt that if it took six months and the construction was delayed until the 2010 construction season, then the council should take the time to craft a more affordable policy. He said everyone felt the $10,000 to $20,000 assessment was onerous “even in the best of times.” He averred that no one should ever have to take a loan out on their house “to pay a tax.” He alleged that many of the people in the area would not qualify for a bank loan and would be forced to take a loan from the City at eight percent. He opined that this could be considered “predatory lending.” He believed that forcing someone into an unwanted loan raised both moral and legal questions. He declared that a small assessment shared among many made more sense than the current policy of “gouging the few to pay for the benefit of all.” He urged the council to accept the challenge to create a better assessment policy for all of Eugene. Marion Eddie , 830 Crest Drive, Ward 2, encouraged the council to work together to rethink the current means of assessment not only for the Crest Drive/Friendly Street/Storey Boulevard area but for all of Eugene. She said the council had heard “many heart-felt stories” about why the present assessment policy was alarming. She asked the council to please listen to the neighbors and citizens. She averred that if they continued with the present policy, it would cause an undue and unfair financial burden. She had hope that the council could come up with a more fair assessment and still complete the road repairs. Sue Kelly , 97405, recalled that when she had been a letter carrier in Springfield 27 years ago, some road repairs had been done and the people she brought mail to had been assessed for them. She related that it had caused terrible hardships and some people had lost their homes. She believed they could come up with something better than the current mode of assessment. She had spent two days gathering signatures and everyone she had spoken with liked the project and appreciated the work the City had done to arrive at a design they approved of, but all of them were against the means of assessment. She agreed with Mr. Eddie; this was a City and not a group of neighborhoods “loosely strung together.” She said if all of the street projects were covered under one umbrella that everyone paid for, the City could have all of the streets that it needed. She quoted comments by the Mayor, Councilor Taylor, Councilor Clark, City Engineer Mark Schoening and Councilor Poling at the previous meeting that were in support of working on the assessment policy or were against causing hardship for people. Rick Robertson , 839 Crest Drive, stated that he had purchased his home in the Crest Drive area one year earlier. He had known that the assessments were coming up because the sellers had been forthright about it. He felt that the assessment process was not entirely fair. He wanted the City to work to find a more equitable way to pay for the improvements. Marlene Varady , 420 Crest Drive, Ward 2, agreed with everyone who spoke about the street assessments. She believed the area residents were asking the council to take on a “daunting task;” it would be a lot of work to change the law. She was sure several of the area residents would be glad to help with the process, if they could. She said they had worked hard to get the amount of signatures necessary for the remonstrance. She noted that the residents in the Elmira Road/Maple Street area had not “been so fortunate” and had not been able to get the number of signatures needed. She related that she had been asked at a Crest Association meeting whether she would be willing to pay for the Elmira Road area streets, too, and she had replied that “of course” she would. She wondered if it would be possible to reverse the ruling regarding the Elmira Road residents. She underscored that it was a difficult time to refinance or get loans. She also wondered if the City might consider lowering the interest rate it was offering to those people who had difficulty getting financing for the assessments. MINUTES—Eugene City Council May 26, 2009 Page 3 Regular Meeting Mayor Piercy closed the Public Forum. She expressed her appreciation for the time people took to come and testify. She said while she did not know how much they would agree or disagree; she appreciated Mr. Siekel-Zdzienicki and Ms. Hutson’s input and their concern for their community. She related that the former Police Auditor had provided information to her regarding the taser cams. She hoped the City would consider purchasing them. Councilor Taylor thanked everyone for coming and providing testimony. She recalled that she had been saying that the street assessment policy was not fair for years. She opined that if the City “did it to everyone at once, there would be a revolution.” She believed that the loans from the City should be no- interest. She supported allowing people to wait to pay when the property changed hands and assessing people in the cul de sacs. Councilor Clark echoed appreciation for the people who spoke before the council. He agreed that in the best world there would be a great chain of evidence in both video and audio in those cases where a taser was deployed. He noted that he and the other Police Commissioners had spoken of this. He said the challenge of putting the cam on the taser was that it was only activated when the taser was pointed at the person; the lead-up to that point was missed, which sometimes provided some pretty important information. He agreed that having a better video record would be an improvement, but thought they needed to find a different way of capturing it. He hoped the Police Chief, and staff, were working on ways that could be done. Councilor Clark asked Mr. Schoening to remind him of the number of miles of improved roads versus unimproved roads there were in Eugene. He noted that he had voted ‘no’ on the Elmira Road project. Mr. Schoening responded that Eugene had approximately 500 miles of roads, 50 of which were unimproved. Councilor Clark surmised that 10 percent of the roads were subject to the assessment model, if the neighbors decided to improve them, but 450 miles of the roads had already been paid for by the homeowners. Mr. Schoening affirmed that the homeowners had either paid through assessments or in the purchase price of their homes. Councilor Clark said he would love to hear from the residents what would be fair to the people who had already paid the higher price of their home to live on an improved street. He also wondered if any studies had been conducted on whether home values had changed on an improved road. Mr. Schoening responded that such a study had not been conducted. Councilor Clark said he would also favor paying for the assessments upon the sale of a property, but this would mean the City would have to establish a fund to find the money in order to do so. 2. CONSENT CALENDAR A. Approval of City Council Minutes - April 8, 2009, Work Session - April 8, 2009, Executive Session - April 13, 2009, Work Session - April 15, 2009, Work Session - April 20, 2009, Public Hearing B. Approval to Tentative Working Agenda C. Appointment of Lane Workforce Partnership Board D. Approval of Community Development Block Grant Recovery Funds Allocation E. Adoption of Resolution 4978 Approving a Multiple-Unit Property Tax Exemption for th Residential Property Located at 362 East 12 Avenue, Eugene, Oregon (Midtown Terrace LLC, Applicant) F. Ratification of Intergovernmental Relations Committee Minutes of April 15, 2009, April 22, 2009, and April 29, 2009 MINUTES—Eugene City Council May 26, 2009 Page 4 Regular Meeting Councilor Zelenka, seconded by Councilor Clark, moved to approve the Consent Calendar. Councilor Zelenka pulled Items D and E. Roll call vote; the motion to approve the Consent Calendar with the exceptions of Items D and E passed unanimously, 7:0. (Councilor Solomon had temporarily left the dais.) Councilor Zelenka explained that he had pulled Item D not because he was opposed to it, but because he liked the fund allocation and wanted someone to talk about it. Grants Manager for the Community Development Division Stephanie Jennings explained that Item D was a special allocation from the Community Development Block Grant (CDBG) funds that had been created through the American Reinvestment and Recovery Act (ARRA). She said the City of Eugene was eligible to receive a formula allocation of $371,021 of the stimulus money to carry out CDBG activities with an emphasis on job creation and other things meant to address the immediate economic recovery needs. Counselor Solomon returned to the dais. Ms. Jennings said the first of two programmatic pieces that staff was proposing was the Business Development Fund, a fund used to support a variety of community businesses that had resulted in the creation of over 1,000 jobs to date. She related that the other piece was funding for foreclosure prevention counseling, provided by a local agency for people who earned 80 percent of the area median income and below. Mayor Piercy remarked that they could not ask for better things to be able to do. Roll call vote; the motion to approve Consent Calendar Item D, approval of the Community Development Block Grant Recovery Funds allocation, passed unanimously, 8:0. Councilor Zelenka explained that he had pulled Item E because of his long-standing objection to utilizing the Multiple-Unit Property Tax Exemption (MUPTE) in the West University Neighborhood. He believed that the money would be spent on housing regardless of whether the developer was granted a MUPTE or not. He supported the MUPTE boundary expansion in the downtown area and the Trainsong area. He averred that development in the WUN was “going gangbusters.” Councilor Taylor also opposed the MUPTE. She also disapproved of placing a MUPTE in the Consent Calendar. She considered the item to be controversial and the Consent Calendar to be for routine items. Mayor Piercy read from page 82 in the Agenda Item Summary (AIS), which explained the difference between a market product and the product that could be offered for a MUPTE application, which exceeded the code requirements in several areas as a result of the tax exemption. She noted that the project would include one handicapped-accessible unit and that the Eugene Water & Electric Board (EWEB) had indicated that it would meet the Silver Earth Advantage energy conservation benchmarks, among other things. She felt the project was moving in a direction that the City wanted to go and the development would be a better product for the neighborhood that fit with community goals. She averred that this was why the neighbors supported it. Councilor Brown asserted that the “whole situation” had arisen from the University of Oregon’s “unwillingness” to house students. He agreed that it was a “wonderful project,” but he was not sure that the MINUTES—Eugene City Council May 26, 2009 Page 5 Regular Meeting use of a MUPTE was the way to go. He felt that if the MUPTE were used, it should be available to all areas of the city. Urban Services Manager for the Community Development Division Richie Weinman noted that the program was governed by state law. He said the program was available only in the core area or along transit-oriented areas. He stated that the boundaries were chosen by the council, which had debated the issue at great length numerous times. He did not believe the entire town could qualify for the MUPTE under state law. Councilor Brown commented that “oddly enough” he was going to support it. He believed it was a good project and that there had been a lot of inappropriate developments without the MUPTE in the WUN. He looked forward to seeing the Infill Compatibility Standards. He felt the conclusions and recommendations would help to solve a lot of problems. He supported maintaining the Urban Growth Boundary (UGB) where it was for as long as possible. He believed that projects such as the one before the council helped to do this. While he still opposed the MUPTE in general, the approval of the WUN had contributed to his decision to support this particular project. Councilor Clark respectfully disagreed with Councilor Brown’s assertion that it was the University’s responsibility to provide students with housing. He looked at the students of the University as members of the broader community, rather than as members of the University community. He believed that the City benefited from having the student population as members of the larger community. He indicated he would support the MUPTE as a matter of principle. He declared that this was not a matter of simple affordability and whether or not it was affordable or profitable to build housing in that area or in another area, it was about what kind of housing would be built. He underscored that they had spent a lot of time discussing impacts on neighborhoods and what kind of housing should be built. He averred that they wanted to build “very nice stuff” that had a low impact on existing neighborhoods. He observed that the City had a lot of requirements for people who would build or rebuild homes in existing neighborhoods. He believed that this helped to make Eugene a better city and the MUPTE was a good tool toward that end. Councilor Taylor reiterated her feeling that if everyone who had a good project received a tax exemption, there would not be money with which to run the City. She declared that the City ran on taxes and that everyone should pay taxes. Councilor Solomon thanked staff for providing Attachment G in the AIS, which detailed the tax exemption. She explained that during the ten years the project would be exempt from taxes only on the value of the building (the value of the land would still be on the tax roll); the foregone taxes would come to $34,530. th She stressed that in the 11 year, after the MUPTE had expired, the taxes on the development were projected to be $40,000. She considered the project to be a “net gain on all fronts.” Mayor Piercy believed the project could only be built at the level of quality that was proposed with the exemption. Roll call vote; the motion passed, 6:2; councilors Zelenka and Taylor voting in opposition. 3. ACTION: Ratification of Unanimous Intergovernmental Relations Committee Actions and Discussion and Action on Non-unanimous Intergovernmental Relations Committee Actions on Legislative Policy from May 20, 2009 MINUTES—Eugene City Council May 26, 2009 Page 6 Regular Meeting Councilor Zelenka stated that the only bill before the council was House Bill (HB) 3485, which would establish a tax credit for transportation of woody biomass from forest management operations to biofuel producers. Councilor Zelenka, seconded by Councilor Clark, moved to adopt a Priority 3 Support position on House Bill 3485. Intergovernmental Affairs Manager, Brenda Wilson, stated that the bill was currently stalled in the House Revenue Committee. She explained that although the Dead Bill Deadline was on May 29, because this bill was in the Revenue Committee, it could still move. Councilor Zelenka ascertained from Ms. Wilson that the bill was an attachment to an existing bill that would provide tax credits for various products and waste streams for biofuels. Ms. Wilson noted that this was one of the tax credits the bill would create. She said it would also create a tax credit for the purchase of equipment to collect the waste materials, for recycling waste materials into other useful products, and for energy generation from woody biomass. She added that the bill would also require the Oregon Department of Energy to study biofuel facilities and to report back to the next legislature. In response to a follow-up question from Councilor Zelenka, Ms. Wilson confirmed that the tax credit for waste material would help to divert such materials from the landfill. She explained that one example used in the last hearing was that if a person was going to raze a house, the materials could be converted into biomass and the person could receive a tax credit for it with this bill. Councilor Zelenka understood that biomass was considered a renewable fuel under the Renewable Portfolio Standards (RPS). He said the standard for consideration to be renewable was that it had to be carbon neutral. He indicated he would support the motion. Councilor Taylor asked if the bill had been supported by the Seneca Sawmill. Ms. Wilson replied that Seneca did not testify on this bill. Councilor Taylor declared that wood left to rot nourished growth. Roll call vote; the motion to adopt a Priority 3 Support position on HB 3485 passed, 6:2; councilors Brown and Taylor voting in opposition. Councilor Zelenka, seconded by Councilor Clark, moved to ratify the Intergovernmental Committee’s unanimous actions on bills and approval of staff recommendations in the May 20, 2009, Intergovernmental Relations Bill Reports for bills not pulled for discussion at those Intergovernmental Relations Committee meetings. Roll call vote; the motion passed unanimously, 8:0. 4. ACTION: Resolution 4977 Adopting an Amendment to the Systems Development Charges Administrative Fee and Amending Resolution No. 4900 Councilor Zelenka, seconded by Councilor Clark, moved to adopt Resolution 4977 adopting an amendment to the Systems Development Charges Administrative Fee and amending Resolution No. 4900. MINUTES—Eugene City Council May 26, 2009 Page 7 Regular Meeting Councilor Clark, seconded by Councilor Solomon, moved to amend the Resolution to change the effective date from July 1, 2009, to January, 2010. Councilor Clark said he would hate to see the City raising any kind of Systems Development Charge (SDC) related costs in this economic time. Mr. Schoening said the increase had been postponed several months already. He explained that the Public Works Department had already reduced staff by two Full Time Equivalent (FTE) positions in the fund. He thought it could survive by buying down more of the construction permit reserve. He underscored that the service would not go away because it was required for the building permit activity that the City had. He reiterated that the impact would be to other funds, should the current SDC administrative charge remain the same. Councilor Brown asked what the rationale was for capping the four percent increase at $30,000. Mr. Schoening replied that the intent was that at that rate, the capped amount more than covered the cost of the service provided in larger more complex projects. He said they were trying to maintain a rate that coincided with the services provided. Councilor Brown asked for an example of a project that would be capped at $30,000. Mr. Schoening responded that if Autzen Stadium or the arena project had been built on green fields they probably would have paid SDCs that would have generated that kind of administrative fee. Councilor Brown thought the cap was somewhat arbitrary. He indicated he would not support it at that number. Councilor Zelenka asked Mr. Schoening how much the City would forego in revenue. Mr. Schoening replied that the revenue at the current level of activity would be approximately $90,000 in this fiscal year. This meant that deferring the increase would cause an impact of approximately $45,000. He said the permit center had very few funding sources, the other major source being the construction permit fund. He reiterated that the service would still be provided and the question was how to fund it. Councilor Zelenka surmised that other funds would be depleted to make up for deferring the increase in SDC administrative charges. Mr. Schoening replied that it would not deplete the funds, because there were some “vacancies” in the other funds. He cited, as an example, that there was a person working on the Wastewater Master Plan which meant that a position was vacant. Councilor Zelenka ascertained from Mr. Schoening that the four percent increase was equal to approximately $90,000 in this fiscal year. He asked what the impact would be on the work load. Mr. Schoening responded that he did not think it would affect the service or the work load; it would only affect the construction permit fund. Councilor Solomon noted that the council planned to discuss a local economic development plan at its work session scheduled for May 28. She felt that the increase to the fees was counter-productive to the goal of economic development. Councilor Clark said he was thinking of putting into place something other jurisdictions had done, which was to attach the fees at the closing of the deal when a development was sold. He did not want to actively discourage, through fees, any economic development. He understood that the projected amount of the fee increase was based on current permitting levels. He said this was based on the assumption that, no matter what the City did, the permit levels would remain the same. He wanted to find ways for permit numbers to increase and he believed that delaying the fee increase was a way to do so. He felt it would cost more to present more economic challenges to the potential development activity that could occur in the community. MINUTES—Eugene City Council May 26, 2009 Page 8 Regular Meeting Councilor Pryor noted that the fee for a single-family residence was $280 and asked what percentage of the cost of the residence this was. Mr. Schoening clarified that the amount was not related to the cost of the house, it was related to the cost of the services. Councilor Pryor asked how many starts the current estimates were based on. Mr. Schoening was not sure of this number. He said the starts were both commercial and residential and he did not know what the split was. He indicated that he could get the information. Councilor Pryor said he was trying to get at the impact of a possible delay. He questioned how much $280 would really impact home sales and starts. He averred that in the current market a person could get $280 in “change orders on carpet.” He asked if Mr. Schoening could give a more specific idea of the impact on the department a delay to January would create. Mr. Schoening replied that a person coming to the permit center would not notice a difference, but between July, 2009, and January, 2010, a couple of funds would “take a little bit of a hit.” Councilor Pryor surmised that a delay would be “a pain but not a burden.” Councilor Poling asked when the SDC on a project was collected. Mr. Schoening replied that SDCs were due when the building permit was issued, but could be financed through the City and paid for over a ten- year period. Councilor Poling understood that Eugene was not doing what Springfield and some other cities were doing, which was to collect the SDCs when the final check-off happened and occupancy was about to occur. He wondered if it would be possible for the council to have a discussion about considering a shift to this practice. He appreciated Councilor Clark’s motion. He knew a number of builders for whom a $280 fee would be a big impact. He pointed out that the City was losing builders every day and loans were harder to get than before. He said it was a “tough” situation. Councilor Zelenka had deduced from the total of the estimated revenue that the fees would be generated by th 160 housing starts approximately. He observed that $280 was 1/10 of one percent of the cost of an average house. He was challenged to imagine that the fee increase would have a “giant impact” on the building industry. He expressed appreciation for Mr. Schoening’s candor in what impact delaying the fee would have on staff. Councilor Brown asked if it was rare for a project to reach the $30,000 cap. Mr. Schoening responded that it was rare and there were no projects of that magnitude currently “in the pipeline.” Councilor Pryor recognized that delaying the fee increase could be more symbolic rather than tangible in terms of benefit. He did not want something symbolic to hurt staff and this was why he had sought to determine whether staff would really be impacted very much by the delay. He said if they could send a message that the City supported reinvigorating the community, he could be supportive of it. He added that if staff had responded that it would create a big impact, then he would have been more inclined to oppose the amendment. He thought this could send a positive signal to the community that the council wanted to try to do what it could to help. Mayor Piercy expressed appreciation for the conversation and for the spirit of being sensitive to the challenges being faced by the community at present. She supported the amendment but did not want to give the impression that they were any less supportive of SDCs; the council still had a commitment to having private development pay its own way as much as possible. MINUTES—Eugene City Council May 26, 2009 Page 9 Regular Meeting Roll call vote; the motion to amend the resolution passed, 7:1; Councilor Taylor voting in opposition. Roll call vote; the motion passed, as amended, 7:1; Councilor Taylor voting in opposition. Mayor Piercy adjourned the meeting of the Eugene City Council and convened a meeting of the Eugene Urban Renewal Agency at 8:52 p.m. 5. ACTION: Beam Development Extension Request Councilor Zelenka, seconded by Councilor Clark, moved to direct the Agency Director to 1) amend the Purchase and Sale Agreement to extend the required start of construction date by six months to December 1, 2009; 2) negotiate with Beam to provide flexibility in the Purchase and Sale Agreement, if possible, regarding the City’s commitment for leased space, and if negotiations are successful to amend the Purchase and Sale Agreement regarding leased space without approval from the Urban Renewal Agency, and 3) continue discussions with Beam and Lane Community College regarding the possibility of locating a new Lane Community College Downtown Center on the Beam property. Mayor Piercy said the City had been trying to get the project going and the City and the developer had worked hard to move forward with filling one hole and renovating the adjacent building. She stressed that the financial underpinnings were difficult for everyone at present. Senior Development Analyst for the Community Development Division Denny Braud said the problems the project faced were two-fold. He stated that, primarily, the economy was presenting problems for project financing. He noted that the City of Portland currently had about 40 urban renewal projects that were on hold because of it. He related that Beam Development was facing the same challenges as many developers in trying to attract financing, tenants, and investors. He said the delay would provide the opportunity for Beam to extend the project and to “hopefully make some headway” on it. He noted that the other advantage of providing some additional time had to do with the emerging interest of Lane Community College (LCC) to locate there. He shared staff’s belief that having LCC at that location would make the building a landmark for many years. He averred that the additional six months would give Beam Development, the City, and LCC an opportunity to forge a partnership. Mayor Piercy stated that she was a big supporter of LCC. She understood that the college had to wait until it heard from the Legislature regarding funding in order to see the potential of this partnership. She believed that it would be a “great thing” to do. Councilor Poling indicated that he would support the motion. He recalled that when the original discussion had occurred, some councilors had averred that Beam had the ability to move in and start the project “tomorrow.” He said it was obvious how bad the current economy was when a company that could have supposedly come in and started the next day was coming back and asking for an extension. He pointed out that Beam Development had made all of the payments required of it. He liked the idea of LCC moving into that building. He noted that the council had granted KWG Development Partners an extension and he felt it would be fair and consistent to do the same for Beam Development. He added that he did now know if the City could support another extension. He did not want to experience another situation like the one the City had faced with the Oregon Research Institute. MINUTES—Eugene City Council May 26, 2009 Page 10 Regular Meeting Councilor Clark recalled that he had been concerned about the City guaranteeing the space as a renter. He averred that this situation was different, one that he could support. He believed locating the LCC downtown center in the building would be a “fantastic idea.” Councilor Taylor commented that she had been disappointed to hear about the situation from the newspaper. She thought having LCC locate in the building would be “great.” She had some concern that the amount of money would not be enough, averring that “$9 million is nothing.” In response to a question from Councilor Taylor, Mr. Braud clarified that the City wanted to have a little bit of flexibility in order to reduce its commitment from the original 50,000 square-foot amount. He said it was a good time to rethink this commitment now that the PSA was open and the City was renegotiating. Councilor Taylor asked how much space the City was currently renting in the downtown area. City Manager Jon Ruiz replied that he did not know, but he would find out from Facility Division Manager Mike Penwell, He added that he was not certain space taken in the Beam project would come from currently leased space. Councilor Taylor asked if the City was delaying the project by negotiating with LCC. Mr. Braud assured her that the City was not. He explained that Beam Development had to attract a high percentage of pre- lease commitments in order to start, which was challenging in the present economy. He said lenders would require 80 to 100 percent building occupancy before financing the project, a big change from the previous year. Mr. Ruiz thought if the City could “work a deal” with LCC, it could accelerate the process. Councilor Taylor asked if staff was confident that LCC could raise the money. Mr. Braud replied that this was something LCC had to make progress on. He said the college still had some work to do and needed to accelerate the project in order to attract funding sources, such as stimulus money which was contingent on being shovel ready. Councilor Zelenka understood the current economic influences on the project. He liked the idea of having LCC downtown. He said Beam Development had been looking all over town for tenants. He felt that the project could jumpstart the downtown area. Mayor Piercy expressed appreciation to staff for its “hard and inventive work” to keep the project moving forward. She also appreciated Beam Development’s commitment to the community. She stressed that the situation was not one of someone “dragging their feet.” She also wanted to convey her appreciation to LCC for taking an interest in the project. She hoped the economy would improve soon, and underscored that the lack of development was not due to a lack of interest. Councilor Solomon asked if LCC wanted to take over the entire development. Mr. Braud replied that LCC was looking for 80,000 square feet and the Centre Court Building was not that large. In response to a follow-up question from Councilor Solomon, Mr. Braud stated that ownership was critical to LCC because of bond funding requirements. Councilor Solomon asked if it “all fell apart” would the City lose money. Mr. Braud responded that the City would not lose money, but Beam had a financial stake in it because of carrying costs. He said the City was able to service its Department of Housing and Urban Development (HUD) loan with Beam’s payments. MINUTES—Eugene City Council May 26, 2009 Page 11 Regular Meeting Councilor Solomon echoed the Mayor’s compliments to staff. She observed that the situation was extraordinarily complicated and frustrating. She believed that if the City stuck with it, the project would come to fruition. Councilor Brown indicated he would support the extension. Councilor Poling clarified for the public that the item did not come to the council as a surprise in the newspaper. The information was on the council packet delivered on May 22 and the council had prior knowledge of it before it hit the press. Councilor Zelenka referred to the letter from Beam Development, on page 143 of the Agenda Packet. He pointed to the fourth bullet point and said he interpreted it as indicating that the City could have to pay some financing charges on the property if the project did not get going within six months. Mr. Braud agreed with that interpretation. He said if Beam spent the next six months trying to court LCC to the site and then LCC could not attract all of the funding, the project would then have to start all over. He believed that the fourth bullet point was there in recognition of this possibility. Councilor Zelenka commented that all of it depended on what happened with the economy. Mayor Piercy remained hopeful that the “moments of opportunity for funding” would help the project launch. Roll call vote; the motion passed unanimously, 8:0. The meeting adjourned at 9:14 p.m. Respectfully submitted, Jon Ruiz City Manager (Recorded by Ruth Atcherson) MINUTES—Eugene City Council May 26, 2009 Page 12 Regular Meeting