Two ordinances updating tax exemption programs for multiple-unit and low-income housing developments were up for citizen review at two remote public forums on May 18. No residents commented at either hearing.
The controversial Multiple Unit Property Tax Exemption (MUPTE) program is intended to incentivize developers to build high-quality, multi-unit downtown housing in areas close to public transit, according to the city website. Higher-density downtown development is one of the goals of Envision Eugene, the city’s 20-year growth management plan. Rental housing and housing for home ownership is eligible for MUPTE. Student housing is not.
EW previously reported on MUPTE’s 2013 suspension, in part because of a fall-through in the design promises of a MUPTE-approved student housing complex. The developers of 13th & Olive, also known as Capstone, dropped plans laid out in their MUPTE application for a 5,000-square-foot retail space on the ground level, resulting in a loss of pedestrian and retail activity. MUPTE had granted the project a $16-million tax break.
The Eugene City Council voted to reinstate MUPTE in 2015 through an ordinance that revised the program.The ordinance removed the eligibility of student housing projects, required higher quality design, and created a review panel to increase oversight of the application and construction process, according to the city website.
In Sep. 2019, Eugene City Council voted 5-3 to approve an estimated $1 million tax break through MUPTE to a five-story building project on Ferry Street, according to the city website. The design does not include retail space on the ground floor.
The public forum on May 18 was intended to facilitate comments from Eugene residents about proposed changes to the program, according to newly re-elected Mayor Lucy Vinis. Eugene City Manager Pro Tem Sarah Medary said the ordinance up for consideration included three adjustments to the incentive program.
Medary said the proposed ordinance extends the construction deadline for MUPTE developments by 10 years, from January 2022 to January 2032. The ordinance would update the green building requirement for approved developments to be 10 percent more efficient than the state’s recently adopted energy code (Oregon Zero Energy Ready Commercial Code), according to the city website. The changes would also drop the requirement that projects obtain an Energy Star certificate, a green energy pathway no longer offered by Eugene Water and Electric Board.
A second public hearing was held on May 18 to consider an ordinance extending the end date for the Low-Income Rental Housing Property Tax Exemption program (LIRHPTE).
LIRHPTE is an incentive strategy to promote construction of low-income housing developments. The program was first adopted by the Eugene City Council in 1990, according to the city website.
In the past 30 years, Eugene has approved 33 property tax exemptions for low-income developments, including Emerald Village and the Saint Vincent de Paul Youth House.
The ordinance up for consideration at the public forum would extend the LIRHPTE program by ten years, to July 2030.
“Our current program is actually expired under city code,” Medary said. She said the ordinance is “necessary if you want to continue providing that program to future affordable housing development.”
City Council will take action on the proposed ordinances amending MUPTE and LIRHPTE on May 25.