HomeMy WebLinkAboutResolution No. 5475Tiii 1s1e1e Iii
COUNCIL RESOLUTION NO. 5475
A RESOLUTION AMENDING RESOLUTION NO. 5439 AND
APPROVING A MULTIPLE-UNIT PROPERTY TAX
EXEMPTION FOR RESIDENTIAL PROPERTY LOCATED
AT 131 EAST 5TH A VENUE, EUGENE, OREGON
(APPLICANT OBIE COMPANIES, INC.)
PASSED: 7:1
REJECTED:
OPPOSED: Zelenka
ABSENT:
CONSIDERED: February 9, 2026
•
RESOLUTION NO. 5475
A RESOLUTION AMENDING RESOLUTION NO. 5439 AND
APPROVING A MULTIPLE-UNIT PROPERTY TAX EXEMPTION FOR
RESIDENTIAL PROPERTY LOCATED AT 131 EAST 5TH AVENUE,
EUGENE, OREGON (APPLICANT OBIE COMPANIES, INC.)
The City Council of the City of Eugene finds that:
A. OES #2, LLC (296 E. 5th Avenue, Eugene, Oregon), is the owner of real property
located at 131 East 5th Avenue, Eugene, Oregon (Assessor's Map Number 17-03-30-44, Tax Lot
09700) ("the Property").
B. On April 26, 2025, the Eugene City Council adopted Resolution No. 5439 ,
approving a property tax exemption pursuant to the City's Multiple-Unit Property Tax Exemption
Program (Sections 2.945 through 2.947 of the Eugene Code, 1971 ("EC")), with respect to
residential units and commercial spaces to be constructed on the Property ("the project").
C. Resolution No. 5439 specified that the multiple-unit property tax exemption
(MUPTE) approval was for a project consisting of 41 studio units, 71 one-bedroom units, and 12
two-bedroom units , for a total of 124 residential units.
D. In October of 2025, Obie Companies (the applicant) proposed revisions to the
project that necessitate the amendment of Resolution No. 5439. The proposed revisions include
the addition of six dwelling units , a change in the unit mix, and the addition of balconies
overlooking 5th A venue. The project is not designed for the leasing of individual rooms or beds ,
for transient or vacation uses , or otherwise designed primarily for individuals attending college.
E. As revised, the proposed project will include 18 studio units , 78 one-bedroom units ,
and 34 two-bedroom units , for a total of 130 residential units.
F. The proposed project will also include approximately 7,136 square feet of
commercial space for which the applicant has requested tax exemption. A MUPTE may be applied
to commercial space when it is deemed to be a required design element or a public benefit of the
project. The proposed commercial space along 5th A venue will bring activity to a downtown Great
Street and engage the building with the public realm in a way that could not be accomplished if
the ground floor consisted of residential units. The inclusion of commercial space and activation
of the street significantly contribute to the project 's compliance with the Design and Compatibility
public benefit subcriteria of scale, form, and quality ; mixture of project elements; and relationship
to the street and surrounding uses.
G. The proposed project will also include approximately 69,500 square feet of parking
in an attached two-story parking garage. The bottom floor of the garage, approximately 35,750
square feet, will be u se d by non-resident visitors, such as customers of the commercial tenants.
Resolution -Page 1 of 6
The top floor of the garage , also approximately 34 ,750 square feet , will be dedicated for use by
residents. The applicant has requested the exemption for the parking area dedicated for use by
residents. Parking for residents supports the residential use , and, as proposed, meets requirements
for parking and circulation.
H. An independent outside professional consultant was retained and reviewed the
revised project 's financial pro-forma.
I. The Executive Director of the Planning and Development Department ("the
Executive Director"), as designee of the City Manager, prepared the Report and Recommendation
attached to this Resolution as Exhibit A and incorporated herein by reference. The Report and
Recommendation sets forth findings demonstrating that the revised project meets the criteria
described in EC 2.946 and the conditions set forth in Multiple-Unit Housing Property Tax
Exemption Rule R-2.945 ("Rule R-2.945").
J. Based on the findings in the Report and Recommendation, the Executive Director
recommends that the Council amend Resolution No. 5439 to approve application of the MUPTE
to the revised project. In making that recommendation , the Executive Director found that the
applicant submitted all materials , documents , and fees as required in EC 2.945 , EC 2.946 , and Rule
R-2.945 , and the applicant is in compliance with the policies contained therein.
K. The City Council has concluded that the criteria described in EC 2.946 and Rule R-
2.945 have been met.
NOW, THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EUGENE, a
Municipal Corporation of the State of Oregon, as follows:
Section 1. Based upon the above findings which are adopted , and the City Council 's
review of the Report and Recommendation of the Executive Director of the Planning and
Development Department attached to this Resolution as Exhibit A and incorporated herein by
reference, the City Council amends Resolution No. 5439 to approve the ad valorem property tax
exemption under the City 's Multiple-Unit Property Tax Exemption Program for the residential
units and commercial space to be constructed at 131 East 5th Avenue , Eugene , Oregon (Assessor 's
Map Number 17-03-30-44 , Tax Lot 09700) subject to the following conditions:
1.1 Compact Urban Development. The project will consist of the development of 18
studio units , 78 one-bedroom units , and 34 two-bedroom units , for a total of 130
residential units , none of which are for transient use or vacation occupancy. There
are 7,136 square feet of commercial space on the ground floor of the building for
which the applicant has requested tax exemption. The proposed project will also
include approximately 69,500 square feet of parking in an attached two-story
parking garage. The top floor of the garage, approximately 34,750 square feet, will
be dedicated to residents and is included in the tax exemption. The bottom floor of
Resolution -Page 2 of 6
the garage, approximately 34,750 square feet, is not dedicated to residents and is
not eligible for exemption.
Multiple-Unit Housing Property Tax Exemption Rule R-2.945 ("Rule R-2.945")
requires that in order to be eligible for a MUPTE, projects on residentially zoned
properties must provide residential units equivalent to at least 175% of the
minimum density applicable to the property's zoning designation. The project will
be built on land zoned with a combination of C-2 Community Commercial and C-
3 Major Commercial, neither of which are residential zones and neither of which
includes a minimum residential unit density.
The project will be constructed in accordance with the schematic drawing showing
the site plan and major features and dimensions of the proposed development, as
well as schematic drawings showing side, front, and back elevations of the
proposed development, all of which are attached to this Resolution as Exhibit B .
1.2 Green Building. The project will utilize the City of E ugene Building and Permit
Services Pathway to meet the MUPTE green building requirement and exceed the
10% energy efficiency threshold. The applicant will submit to the City of Eugene's
Building and Permit Services Division an energy model with the applicant's
development permit application. Within 18 months after receiving a certificate of
occupancy, the applicant shall submit to the City a commissioning report pursuant
to Section 1.1.2.3 of Rule R-2.945-C and will report multi-family occupancy energy
use data to the City's Building and Permit Services Division for the life of the
MUPTE tax exemption.
1.3
The project's on-site parking will include installation of conduit for future electric
vehicle charging stations.
Local Eco nomic Impact Plan and Compliance with Laws. A plan is in place that
demonstrates that more than 50% of the dollar volume of the combined professional
services and construction contracts are or will be from business organizations or
individuals residing or doing business primarily in Lane County.
Applicant will ensure that qualified minority and women business enterprises have
been given an equitable opportunity to compete for development related contracts
by: (1) accessing lists of certified minority , women, emerging small business or
disadvantaged business enterprises from the Oregon State Office of Minority,
Women and Emerging Small Business (recently renamed the Oregon Certification
Office for Business Inclusion and Diversity); (2) searching for Qualified
Rehabilitation Facilities (now known as Oregon Forward Contractors) from whom
to procure products and services v ia the Oregon State Qualified Rehabilitation
Facilities Program (recently renamed the Oregon Forward Program) website; and
(3) advertising in general circulation, trade association, and minority focused media
about prime subcontracting opportunities.
Resolution -Page 3 of 6
Attachment A
The applicant will ensure that information about the City's Rights Assistance
Program in E nglish and Spanish is posted on the job site during construction of the
project.
T he applicant will ensure that the developer and its contractors and subcontractors
comply with wage, tax, and licensing laws.
The applicant will have in place methods for ensuring that all contractors
performing work are licensed and performing in compliance with state law.
The applicant will provide the City 's Building and Permits Services Division with
a list of all contractors performing work on the project. Prior to performing work
on the project, contractors must have valid, current licensing , insurance , bonding ,
and workers compensation coverage, and must be on the list of contractors
provided to the City.
The applicant will require that each contractor provide an affidavit attesting to the
fact that (1) the contractor, owner, or responsible managing individual for the
contractor does not have any unpaid judgments for construction debt , including
unpaid wages; and (2) the contractor is in compliance with Oregon tax laws.
1.4 Moderate-Income Housing Contribution . Consistent with the requirements of
Administrative Rule R-2.945-C 1.3, the owner will pay a fee to be dedicated to
moderate-income housing. The fee wil l be 10% of the total 10-year exemption
benefit.
1.5 Project Design and Compatibility . The applicant shall adhere to the fo ll owing
design elements, as well as th e actual square footages included in Exhibit B unless
the City Manager approv es a deviation from the plan pursuant to EC
2.946(2)( d)6.b.:
The proposed design features a broad 7-story mixed-use apartment building at the
terminus of Oak Street and 5th Avenue. Brick fac;;ade spans the entir ety of the tall
ground floor and is extended up into the archway entrances. The design
incorporate s aluminum storefront windows at the ground floor and stucco as the
primary exterior material on higher floors .
The gro und floor commercial space is organized around a plaza area that define s
th e buildin g's most important relationship with the street and the public realm along
5th Avenue at th e intersection with Oak Street. The project provides parking spaces
for both res idential tenants and visitors to the commercial improvements in a two-
story garage. The garage is situated behind the building against the railroad right-
of-way with access to Willamette Street and 5th A venue. The design successfully
incorporates elements that address the scale, form, and quality of the building; the
mi x of project e lements; the relationship to the street and surrounding uses ; and
parkin g and circulation.
Re so luti o n -Page 4 of 6
During the design process and before the final design drawings are completed, the
owner shall hold at least one neighborhood engagement opportunity to allow
members of the Downtown Neighborhood Association and others to provide
comments on the proposal. At least one of the applicant's principals shall attend
the meeting.
After the final design is completed and before it is submitted for permits , the final
design shall be submitted to the City to review for conformance with the design
approved by this Resolution. The neighborhood shall also have an opportunity to
review and comment on the final design. After the comment period , the City shall
determine if the design is consistent with the requirements of this Resolution, and
if not, whether the City Manager will approve a deviation pursuant to E C
2.946(2)(d)6 .b.
1.6 At the time of completion, the project shall conform with all local plans and
planning regulations , including special or district-wide plans developed and
adopted pursuant to ORS Chapter 195 , 196, 197, 215, and 227 that are applicable
at the time the application is approved.
1.7 During all phases of development, the project shall comply with wage , tax , and
licensing laws.
1.8 The project shall not contain any units for transient use or vacation occupancy.
1.9 The project will be completed on or before January 1, 2032 , unless an extension
of the deadline is requested by the property owner and approved by Council
resolution pursuant to EC 2.947(5).
1.10 The public benefits of the project that will extend beyond the period of the tax
exemption include Green Building (energy performance), Project Design and
Compatibility, and Compact Urban Development.
Section 2. Subject to the conditions in Section 1 of this Resolution , 100% of the
residential units and commercial space as well as the parking area dedicated for use by residents
described in Section 1 are declared exempt from local ad valorem property taxation beginning July
1 of the year following issuance of a Certificate of Occupancy and continuing for a continuous
period of ten years unless earlier terminated in accordance with the provisions of Section 2.94 7 of
the E ugene Code , 1971.
Section 3. Th e City Manager, or the Manager's designee , is requested to forward a copy
of this Resolution to the applicant within ten days, and to cause a copy of this Resolution to be
filed with the Lane County As sessor on or before Apri I 1, 2026.
Resolution -Page 5 of 6
Section 4. This Resolution shall become effective immediately upon its adoption.
The foregoing Resolution adopted and effective the 9th day of February, 2026.
Resolution -Page 6 of 6
REPORT AND RECOMMENDATION
of the Planning & Development Department
Revisions to the Station House Project and Request for Amendment to
Multiple-Unit Property Tax Exemption Approval
Exhibit A
The Executive Director of the Planning & Development Department of the City of Eugene finds
that:
1. OES #21 LLC is the current owner of real property located at 131 East 5 th Avenue in Eugene1
Oregon (Assessor1 s Map #17-03-30-441 tax lot 09700)1 at the intersection of East 5 th Avenue
and Oak Street. In April 2025 1 the Eugene City Council passed Resolution No. 54391 approving
an application from Obie Companies Inc. ("Obie Co.1') pursuant to the Cit/s Multiple-Unit
Property Tax Exemption ("MUPTE 1') program (Sections 2.945 through 2.947 of the Eugene
Code1 1971).
2. In October 2025/ Obie Co. requested revisions to the approved project which require City
Council review.
3. As the City Manager1 s designee1 I have reviewed the revised project proposal and found that:
3.1 The revised project will provide 18 studio units1 78 one-bedroom units1 and 34 two-
bedroom units for a total of 130 residential units. This is an adjustment from the
previously approved 124-unit development, which consisted of 41 studio units, 71
one-bedroom units, and 12 two-bedroom units, which will result in six additional
units.
3.2 The revised project will retain the commercial space on the ground floor, which
Council approved for inclusion in the tax exemption. The inclusion of commercial
space and activation of the street significantly contribute to the project's compliance
with the Design and Compatibility public benefit subcriteria of scale, form 1 and
quality; mixture of project elements; and relationship to the street and surrounding
uses.
3.3 As in the original approved application1 the revised project is not designed to be
student housing/ and residential units will not be available for transient or vacation
occupancy.
3.4 The applicant submitted all materials necessary to review the proposed changes in
the context of the existing MUPTE approval and the requirements set forth in Section
2.945 of the Eugene Code/ 197t and the administrative rules adopted by
Administrative Order No. 53-25-04-F.
3.5 The recommended resolution would not change the portions of the building impacted
by the currently approved tax exemption, which include all residential portions of the
building, the ground-floor commercial space1 and the portion of two-floor parking
structure which serves residential tenants. The portion of the parking structure
Report and Recommendation --Page 1 of 4
Exhibit A
intended for commercial visitors would not be subject to tax exemption and would be
assessed and taxed as normal.
3.6 The revised project responds to the Required Public Benefit criteria as follows.
Where the revised project deviates from the project details as approved in Resolution
No. 5439, the changes are noted.
3.6.1 Compact Urban Development. Compliance with this requirement is
unchanged. Rule R-2.945-B.4. requires that in order to be eligible for MUPTE,
projects on residentially zoned properties must provide residential units
equivalent to at least 175% of the minimum density applicable to the
property's zoning designation. The project will be built on land zoned with a
combination of C-2 Community Commercial and C-3 Major Commercial,
neither of which are residential zones and neither of which includes a
minimum residential unit density.
3.6.2 Green Building Features. Compliance with these requirements is unchanged.
Consistent with the requirements of Administrative Rule R-2.945-C 1.1.2.3, the
project will utilize the City of Eugene Building and Permit Services' pathway to
meet the MUPTE green building requirement.
3.6.3 Local Economic Impact Plan. The revisions do not impact the approved
project's compliance with these requirements. In their original application, the
applicant provided a Local Economic Impact Plan and other materials
demonstrating compliance with program requirements related to local
contracts; opportunities for minority, women, and emerging small businesses;
the City's Rights Assistance Program; and compliance with wage, tax, and
licensing laws.
3.6.4 Moderate-Income Housing Contribution. Consistent with the requirements of
Administrative Rule R-2.945-C 1.3, the owner will pay a fee to be dedicated to
moderate-income housing. The fee will be 10% of the total 10-year exemption
benefit.
3.6.5 Project Design and Compatibility. The proposed rev1s10ns make modest
changes to the approved building design. Review by Urban Design staff
concluded that the changes are positive and that the design continues to meet
all MUPTE design and compatibility criteria. The recommended Council
resolution would replace the originally approved design with the revised
design. The project will adhere to the design shown in the resolution and will
apply basic design concepts that consider the scale, form, and quality of the
building; the mix of project elements; the relationship to the street and
surrounding uses; and parking and circulation. The materials shown in the
resolution will be adhered to, to the greatest extent possible.
The proposed design features a broad, seven-story, mixed-use apartment
building at the terminus of Oak Street and 5th Avenue. The original design
Page2of4
Report and Recommendation
Exhibit A
featured loft units on the top floor (the sixth floor). The revised design would
turn the upper portion of the loft units into a true seventh floor of additional
residential units. Additional changes include new balconies on the sixth and
seventh floors on the building elevation which faces 5 th Avenue. The overall
height of the building is raised seven feet to account for the site's sloped grade
and accommodate small changes spread across the residential floors, including
energy efficient ventilation equipment between floors. The revised design also
adds window planter boxes on the second floor, makes modest changes to the
main entrance, subtly changes window trim and layout, raises the ornamental
band below the 6 th floor to below the 7 th floor, relocates a portion of the
required long-term bike storage space to a new bike room under the parking
access ramp, and substitutes the trash utility entrance from a roll-up door to a
standard pedestrian door.
Apart from these changes, the design remains unchanged, including the
building's exterior materials, its height and form, its overall high quality of
construction, and its significant engagement with the public realm.
3.6.6 Historic and Existing Housing Sensitivity. The project is adjacent or near a
historic locale, Oregon Electric Station building, but the historic locale will not
be affected by the project. Like the approved building design, the revised
design includes no direct structural impacts-such as alterations or
demolitions-to any of the identified historic resources.
3.6.7 Project Need. In support of the revised project proposal, Obie Co. submitted
full financial details as would be required for a newly submitted MUPTE
application. The revised pro-forma and financial information were analyzed by
PNW Economics, an independent real estate economics consultant who found
that the project as proposed faced similar financial hurdles as the original,
approved MUPTE application, which could not be built but for the benefit of
the tax exemption.
The financial information accompanying the revised project proposal is based
on projections prior to finalizing financing, construction, and tenanting. It
includes assumptions regarding rents, vacancy rates, operating costs, lender
underwriting criteria, interest rates, and reasonable rate of return. PNW
Economics and City staff reviewed the assumptions and considered the
impacts of the applicant's proposed revisions to the project. The consultant
analyzed the applicant's new residential unit mix and proposed rents. PNW
Economics concluded that the target rents are largely reasonable but may be
higher than what the market will bear, meaning a MUPTE may be more
necessary to the project's feasibility than the applicant assumes.
Overall, the financial analysis remains substantially the same. The additional
residential units and other details in the proposal slightly improve the financial
outlook for the revised project, but the development would still not be feasible
Pa ge 3 of 4
Report and Recomm e ndation
Exhibit A
without the tax exemption. The PNW Economics analysis concludes that the
project would not be viable without the availability of the MUPTE using the
reasonable assumptions outlined and concludes that MUPTE is critical to the
success of the project from a financial feasibility perspective.
3.7 Obie Co. attended a neighborhood engagement meeting regarding Station House for the
Downtown Neighborhood Association on September 25, 2024. Obie Co. will hold
another neighborhood engagement meeting prior to completing the building's design,
which would feature the revised design, if it is approved. Before submitting for building
permits, Obie Co. will submit the final drawings to staff to review conformance with the
design attached to the MUPTE resolution. Staff will also give interested parties an
opportunity to review and comment on that final design.
4. The community member MUPTE Review Panel considered the original project application
during three meetings held on January 10, January 29, and March 14, 2025. The Panel was not
involved in review of the revised project proposal.
After reviewing the original application, the Review Panel unanimously concluded that the
project meets the Required Public Benefit criteria, that the project's financial need was
demonstrated, and that a ten-year exemption was warranted. The Panel recommended that
the tax exemption be applied to residential and commercial portions of the building and to
portions of the parking structure dedicated for use by residential tenants. The Panel did not
recommend that the exemption be applied to parking dedicated to retail customers.
Therefore, based upon the above findings , the revised project is, or will be at the time of
completion, in conformance with all applicable local plans and provisions of the Eugene Code,
1971, planning regulations, the Metropolitan Area General Plan, and the criteria set forth in the
City's adopted administrative rules. I recommend that the approved MUPTE resolution be
amended to reflect the applicant's proposed changes to the project.
D d h . 28 d f January 2026_ ate t is__ ay o _______ _,
Dern~an 28 2026 07 :34 :42 PST)
Denny Braud
Executive Director
Planning & Development Department
Page 4 of 4
Re port and Recommendation
Exhibit B
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