MUPTE & SDC

MUPTE — Multiple-Unit Property Tax Exemption
SDC — System Development Charges

* UPDATED — July 11, 2015 *

In another impressive demonstration of solid community leadership, councilors Mike Clark and George Brown crafted a set of revisions to the MUPTE ordinance that was adopted 7-1 by the City Council at their July 8 work session. (Councilor Chris Pryor was the sole vote against the revisions.) The changes include:

  • Before any area, other than within the Downtown Plan, east of Charnelton Street, becomes eligible for MUPTE projects, the City Council must have adopted amendment(s) to the MUPTE program requiring that a percentage of the units in an approved MUPTE project must be workforce housing or that the developer must make commensurate “in-lieu of” payments to the City that are based on workforce housing rental rates, and that any such payments will be dedicated to a workforce housing fund.
  • Before any area, other than within the Downtown Plan, east of Charnelton Street, becomes eligible for MUPTE projects, the area must have refinement plan policies, adopted by the City Council and acknowledged by Oregon Department of Land Conservation and Development, that specifically cover multi-family and mixed use projects within the respective area that are supported by City tax exemptions or other City resources.
  • Within the Downtown Plan, east of Charnelton Street, in lieu of the workforce housing requirement, the owner shall pay to the city 10% of the total property tax exemption and that any such payments will be dedicated to a workforce housing fund.
  • The “Advisory Committee” membership will also have a human rights professional and have both an environmental professional and a public health professional (instead of one member for environmental/public health), for a total of six members.

Click the following link for a PDF document with the revised ordinance that City Council will consider at their meeting on Monday, July 13.
MUPTEproposedOrdinance10July2015

On the SDC front, Councilor Zelenka appeared to challenge the provisions as the clock ran out on the meeting. Stay tuned for that issue to be discussed at the next Council meeting.

SPEAK UP!

Take the 3 question survey (just 5 minutes) to let the Mayor and City Council know your opinions on MUPTE:
http://tinyurl.com/muptesurvey

GET INFORMED …

Read Our Pressing Need — Workforce housing needs to be part of MUPTE by Ward 1 City Councilor, George Brown (July 2, 2015 issue of the Eugene Weekly)

Read Rein in tax giveaway for Eugene apartments by Paul Conte (July 5, 2015 issue of The Register-Guard)

* UPDATED — June 24, 2015 *

Based on public and private comments by the Mayor and some city councilors, a majority of councilors appear prepared to approve a new, poorly constructed MUPTE program at their July 8 work session.

An initiative petition is being submitted to let Eugene voters decide whether they want to implement this property ten-year tax exemption for housing developers; and if so, what the rules should be.

Take the survey above and learn how you can help get a public vote on MUPTE.

==================

Read the “Guest Viewpoint” in the January 27 edition of The Register-Guard, which provides a concise description of the reforms introduced by Councilors Brown and Clark.
http://registerguard.com/rg/opinion/32686328-78/tax-break-proposal-puts-community-over-profits.html.csp#disqus_thread

Update: City council has postponed the continuing deliberations on MUPTE. At the Council meeting on February 9, there will be a public hearing and probable vote to extend the MUPTE suspension. This would allow council more time to consider the details of a revised MUPTE program.

Details:

In a tour de force of City Council leadership, Councilors Mike Clark and George Brown led the council to make critical changes that make a new MUPTE ordinance very close to a worthy program. First, Clark and Brown tag-teamed to pass the following motion:

“The two standing neighborhood representatives on the MUPTE Review Panel would be selected by the neighborhood associations. The two representatives from the MUPTE-impacted neighborhood would be selected by the impacted neighborhood association.”

While participation on the MUPTE Review Panel won’t ensure that all approved MUPTE projects are good for the impacted neighborhoods, at least the Review Panel neighborhood members can’t be hand-picked by the City Manager or Mayor.

Clark and Brown successfully fought back and attempt by Councilor Zelenka to keep control in the City Manager’s hands by relegating neighborhood associations to “recommending” people for the Mayor to “nominate” and the City Manager to “appoint.”

The outcome of the work sessions was even better. Staff has proposed that, in addition to the four neighborhood representatives, the City Manager appoint “[f]our technical professionals such as architects, green building specialists, lenders, laborers, or developers” to the MUPTE REview panel. This would have allowed the City Manager to appoint four developers.

Council replaced this language to require one member from each of the four categories:

  • Architects and Green Building Specialists
  • Developers
  • Labor
  • Evironmental Public Health

Eugene citizens can at least have some hope that representatives from the three non-developer categories will be more supportive of neighborhood residents’ concerns. So, in combination, these two changes make the review committee more balanced in favor of the community as a whole, rather than stacked in favor of developers.

Time ran out, but when Council resumes their deliberations some time iin the future, they will consider the following motion that Councilor Brown made:

“I move that the City Manager is directed to revise the MUPTE ordinance so that before any area, other than downtown, becomes eligible for MUPTE projects,  the area must have refinement plan policies, adopted by City Council and acknowledged by DLCD, that specifically cover multi-family and mixed-use projects within the respective area that are supported financially by City tax exemptions,  City funds or other City resources.”

This is the motion that would truly follow Statewide Planning Goals #1 Citizen Involvement and #10 Land Use Planning.

Click here to learn how Councilor Brown’s motion would affect MUPTE approvals.

Click here for the City Manager recommendation that Council approve a new, flawed MUPTE program at the January 20, 2015 work session.

Click here for the proposed MUPTE ordinance and other attachments for the January 20, 2015 work session.

Here’s a brief take on MUPTE … Please weigh in with your respective City Councilor to let them know your views.

MUPTE is a “housing program,” and tax exemptions should be based on a “value-for-value” principle: The City provides cash value in tax exemptions, developers provide commensurate value in the type of housing (including form and location) that addresses Eugene’s most important housing needs.

This simple principle leads to several key elements:

  • The program is not a “developer welfare” program, and tax exemptions should not be based on the developer’s “need.” Only the City’s housing needs should be considered.
  • Eugene’s housing needs are not just for “dwelling units”‘ i.e., to chalk up numbers for the simplistic Envision Eugene “analysis.” By the same token, Eugene’s housing needs are broader than what technically falls under the category of subsidized “affordable” or “low-income” housing. There’s a large unmet need for housing that’s attractive and affordable at market rate to “workforce” families.
  • It’s absurd on the face of it to think that a reasonable “value-for-value” test would be met by the developer “giving” the City 1/10th of the cash amount of the tax exemption (as the City Manager proposes). If the City gives a developer a tax break that’s worth a million dollars (present value), then the City should be able to show tax-paying citizens and businesses a legitimate million dollar value (or at least close to it) in housing that meets the City’s true needs. This requires a credible framework for evaluating the benefit of a proposed MUPTE development. The evaluation need not be complex, however; it could be as simple as a point system (see below).

No housing project should benefit from the community giving up tax revenue, unless the neighborhood community in which the project will develop wants the project. While the zoning code (at least in theory) is the community’s statement of what a private property owner is allowed to build on their own dollar, code requirements are not even close to the standard that should be met for a project that the City in essence uses community members’ money to help pay for. No one should be receive cash value from the City to build a housing development that the neighborhood community (as a whole) opposes. This simple principle leads to a several key elements:

  • There must be a valid community-driven process to thoughtfully establish the standards that must be met for a project that is partially paid for by the community’s (foregone) tax dollars. This process cannot be a staff-driven charade, and it cannot require the community to marshal an 11th hour, get-up-to-speed effort for each proposed MUPTE development.
  • Oregon has a noble and effective planning framework that demands genuine citizen involvement in land use planning, and refinement plans are enshrined as the specific instrument through which citizens can truly be involved in determining the future of their communities. The refinement plan process is the only legitimate, effective means to determine the legally-binding policies that govern the location and standards for community-subsidized housing developments.
  • Whether or not an “advisory committee” has any value in the approval process for individual MUPTE applications, it is in no way a substitute for a community-driven process to establish relevant policies for each area in which the City may grant cash value to housing developers. It’s absurd to suggest that an advisory committee, appointed by the City Manager, that has no more than a quarter of its members from the affected neighborhood and that has no real power at all, is somehow a faithful or meaningful way to let neighborhood communities plan how their neighborhoods will grow and evolve with tax-supported development.

Any MUPTE ordinance that Council adopts that violates the two principles above is certain to be revoked if put to a community vote.

*UPDATED — December 5* Click here for initiative ordinance to require a public vote for any new MUPTE program.

Click here for the “Five-Minute Guide to Fixing MUPTE”.

*UPDATED — June 25*  Click here for MUPTE FAQ.

*NEW*  Click here to read the staff “Draft MUPTE Concepts From Neighborhood Input — June 20” document (June 20).

The MUPTE program has been suspended through February 28, 2015, and City Council is currently reviewing and revising the MUPTE program criteria and process. (See calendar on the right.)

Neighborhood advocates have worked on a community-based proposal for a fair, equitable and sustainable program that allocates the use of the City’s financial incentives (such as MUPTE) and City revenues from development (through SDCs).
In brief, the program we’re proposing would have two parts:

  • For those areas where multi-family development projects are eligible to apply for a Multiple-Unit Property Tax Exemption, the MUPTE approval criteria and process would ensure that impacted neighborhoods are not harmed and would gain concrete benefits from MUPTE projects in or near the neighborhood. (StaffProposedMUPTEareas)
  • For all other areas in the City, a portion of the System Development Charges (SDC) that must be paid by developers of multi-family projects would be allocated at the neighborhood’s direction to transportation and parks improvements that would benefit the areas impacted by the projects.

Click here to read an alternative draft proposal. (This proposal is an early draft and still under discussion.)

Click here to view the City’s “MUPTE Revisions” page.

Click here to read the staff recap of neighborhood leaders feedback through May 25, 2014.

Click here to view the City’s “SDC” web page.

Neighborhood advocates are invited to join the discussion. Read the invitation from fellow neighborhood folks working on this issue.

2 responses

  1. Deborah Craig | Reply

    Many thanks for Survey about MUPTE that will inform City Council. City always short of funds yet is willing to allow well-off developers to avoid Millions in tax revenue – then asks voters to make up for shortfall. Totally nuts.

Leave a reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: