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City Council Packet - 10/16/2012 1 4 • City of Tigard Tigard Workshop Meeting—Agenda TIGA TIGARD CITY COUNCIL MEETING DATE AND TIME: October 16, 2012 - 6:30 p.m. MEETING LOCATION: City of Tigard - Town Hall - 13125 SW Hall Blvd., Tigard, OR 97223 PUBLIC NOTICE: Times noted are estimated. Assistive Listening Devices are available for persons with impaired hearing and should be scheduled for Council meetings by noon on the Monday prior to the Council meeting. Please call 503 - 639 -4171, ext. 2410 (voice) or 503- 684 -2772 (1'DD - Telecommunications Devices for the Deaf). Upon request, the City will also endeavor to arrange for the following services: • Qualified sign language interpreters for persons with speech or hearing impairments; and • Qualified bilingual interpreters. Since these services must be scheduled with outside service providers, it is important to allow as much lead time as possible. Please notify the City of your need by 5:00 p.m. on the Thursday preceding the meeting by calling: 503 - 639 -4171, ext. 2410 (voice) or 503 - 684 -2772 (1'DD - Telecommunications Devices for the Deaf). VIEW LIVE VIDEO STREAMING ONLINE: http: / /www.tvcty. org /government- programming /government - meetings / tigard Workshop meetings are cablecast on Tualatin Valley Community TV as follows: Replay Schedule for Tigard City Council Workshop Meetings - Channel 30 • Every Sunday at 11 a.m. • Every Monday at 6 a.m. • Every Tuesday* at 2 pm (*Workshop meetings are not aired lire. Tuesday broadcasts are a replay of the most recent workshop meeting.) • Every Thursday at 12 p.m. • Every Friday at 3 a.m. • SEE ATTACHED AGENDA 1 14 • City of Tigard Tigard Workshop Meeting—Agenda TIGARD it TIGARD CITY COUNCIL MEETING DATE AND TIME: October 16, 2012 - 6:30 p.m. MEETING LOCATION: City of Tigard - Town Hall - 13125 SW Hall Blvd., Tigard, OR 97223 6:30 PM 1. WORKSHOP MEETING A. Call to Order- City Council B. Roll Call C. Pledge of Allegiance D. Council Communications & Liaison Reports E. Call to Council and Staff for Non - Agenda Items 2. RECEIVE BRIEFING ON AN INTERGOVERNMENTAL AGREEMENT WITH METRO REGARDING FANNO CREEK TRAIL SIGNAGE 6:35 p.m. estimated time 3. FIRST QUARTER BUDGET COMMITTEE MEETING 6:45 p.m. estimated time 4. ECONOMIC DEVELOPMENT DISCUSSION 7:45 p.m.estimated time 5. RECEIVE POPULATION AND HOUSING REVIEW UPDATE 9:00 p.m. estimated time 6. COUNCIL LIAISON REPORTS 7. NON AGENDA ITEMS 8. EXECUTIVE SESSION: The Tigard City Council may go into Executive Session. If an Executive Session is called to order, the appropriate ORS citation will be announced identifying the applicable statute. All discussions are confidential and those present may disclose nothing from the Session. Representatives of the news media are allowed to attend Executive Sessions, as provided by ORS 192.660(4), but must not disclose any information discussed. No Executive Session may be held for the purpose of taking any final action or making any final decision. Executive Sessions are closed to the public. 9. ADJOURNMENT 9:20 p.m. estimated time AIS -1024 2. Workshop Meeting Meeting Date: 10/16/2012 Length (in minutes): 10 Minutes Agenda Title: Briefing on an Intergovernmental Agreement with Metro Regarding Fanno Creek Trail Signage Prepared For: Steve Martin Submitted By: Greer Gaston, Public Works Item Type: Public Hearing - Informational Meeting Type: Council Workshop Mtg. Information ISSUE The council will be briefed on an intergovernmental agreement (IGA) with Metro regarding Fanno Creek Trail signage. STAFF RECOMMENDATION / ACTION REQUEST No action is required; the council will consider the IGA on its October 23, 2012, consent agenda. KEY FACTS AND INFORMATION SUMMARY The Intertwine is the name given to the regional network of parks, trails and natural areas. Metro, along with many businesses, nonprofits and cities, including Tigard, participate in The Intertwine. Most of Tigard's parks, trails and open spaces are included in The Intertwine. In order to provide a consistent and uniform look throughout The Intertwine, Metro developed designs and guidelines for directional (wayfinding) signage for regional trails such as Fanno Creek Trail. In March, Metro posted 10 directional test signs along Fanno Creek Trail near Downtown Tigard. A drawing of a sample sign that was posted is attached. Neighboring Tualatin Hills Park and Recreation District has plans to place similar Intertwine directional signage along its trails. Other segments of Tigard's Fanno Creek Trail lack any type of directional signage; signage is one of the most highly requested trail amenities. Metro was recently awarded a grant to install directional signage on selected regional trails including Fanno Creek Trail in Tigard. The attached IGA outlines Metro and city responsibilities as they pertain to directional signage: 1. Metro will install directional signs along Fanno Creek Trail in Tigard. 2. Tigard and Metro will agree on the type and location of the signs. 3. Tigard, at its expense, will maintain the signs. Tigard is required to contribute $5,000 in matching funds toward the signage project. OTHER ALTERNATIVES The council could propose changes to the agreement or could decide not to approve the agreement (currently scheduled for consideration on the October 23, 2012, consent agenda). COUNCIL GOALS, POLICIES, APPROVED MASTER PLANS None DATES OF PREVIOUS COUNCIL CONSIDERATION This is the first time this IGA has come before the council. Fiscal Impact Fiscal Information: If the IGA is approved at the council's October 23, 2012, meeting, the city will be required to contribute $5,000 in matching funds. This money would come from the park maintenance budget. Attachments Fanno Creek Trail Signage IGA Sample Directional Sign Agreement No. INTERGOVERNMENTAL AGREEMENT Metro Regional Trails:lntertwine Signage THIS INTERGOVERNMENTAL AGREEMENT ( "Agreement ") is made and entered into by and between Metro ( "Metro ") and the City of Tigard (the "City ") effective as of the last date of signature indicated below. RECITALS 1. Metro has received Surface Transportation Program funds for the design, fabrication and installation of wayfinding signs along three regional trails in the Portland Metropolitan area (the "Project "), and the City desires for Metro to install some of these wayfinding signs along the Fanno Creek Trail right of way located within the City (the "Trail "). 2. By the authority granted in Oregon Revised Statutes (ORS) 190.010, local government agencies may enter into cooperative agreements with units of local government for the performance of work on certain types of improvement projects with the allocation of costs on terms and conditions mutually agreeable to the contracting parties. NOW THEREFORE, the premises being in general as stated in the foregoing Recitals, it is agreed by and between the parties hereto as follows: TERMS OF AGREEMENT 1. The City hereby grants Metro and its contractors the right to enter onto and occupy Trail right of way for the installation of signage along the Trail. Before Metro installs a sign, the City and Metro will agree on the type of sign and the place where the sign will be installed on the Trail. This right of entry shall continue for so long as necessary for Metro to complete installation of the signage, and shall terminate upon completion of the installation, or by December 31 2014, whichever is sooner. 2. The City shall, at its own expense, maintain and operate the Project signs on the Trail right of way upon completion of the Project and throughout the useful life of the Project signs. Said maintenance shall be at a minimum level that is consistent with normal depreciation and /or service demand. Parties agree that the useful life of the Project signs is defined as twenty (20) years. The State of Oregon (the "State ") may conduct periodic inspections during the life of the Project signs to verify that Project signs are properly maintained and continue to serve the purpose for which federal funds were provided. If the State determines that additional maintenance is necessary, the City agrees to perform such maintenance. Maintenance responsibilities shall survive any termination of this Agreement. 3. The City acknowledges and agrees that Metro shall have no liability for the quality or accuracy of the signage, and hereby releases Metro for any damages or loss of any kind, including without limitation, direct, indirect, special, consequential, or punitive damages arising out of the use or installation of the signage, or related in any way to the information contained therein. 4. The City shall identify and grant Metro and its contractors all the required permits for the Project. If required, permit fees will be borne by Metro as a Project expense. Hazardous materials, archeological, and environmental investigations will also be borne by Metro as a Project expense. 5. Metro's Project Manager for this Project is Robert Spurlock, 600 NE Grand Avenue, Portland, OR 97232, 503 - 813 -7560, robert.spurlock @oregonmetro.gov, or assigned designee upon individual's absence. Metro shall notify the other party in writing of any contact information changes during the term of this Agreement. 6. This Agreement may be executed in several counterparts (facsimile or otherwise) all of which when taken together will constitute one agreement binding on all parties, notwithstanding that all parties are not signatories to the same counterpart. Each copy of this Agreement so executed will constitute an original. 7. This Agreement and attached exhibits constitute the entire agreement between the parties on the subject matter hereof. There are no understandings, agreements, or representations, oral or written, not specified herein regarding this Agreement. No waiver, consent, modification or change of terms of this Agreement will bind either party unless in writing and signed by all parties and all necessary approvals have been obtained. Such waiver, consent, modification or change, if made, will be effective only in the specific instance and for the specific purpose given. THE PARTIES, by execution of this Agreement, hereby acknowledge that their signing representatives have read this Agreement, understand it, and agree to be bound by its terms and conditions. METRO CITY OF TIGARD By By Date Date Agreement No. 2 Sample Directional Sign Fanno Creek Trail SW Main St Trail to Woodard Park Beaverton Transit Center T AIS -996 3 Workshop Meeting Meeting Date: 10/16/2012 Length (in minutes): 60 Minutes Agenda Title: First Quarter Budget Committee Meeting Prepared For: Toby LaFrance Submitted By: Carissa Collins, Financial and Information Services Item Type: Joint Meeting -Board or Other Juris. Meeting Type: Council Workshop Mtg. Information ISSUE Opportunity for the Budget Committee to meet and discuss financial issues for Tigard. STAFF RECOMMENDATION / ACTION REQUEST No action is required. This an opportunity to share information. KEY FACTS AND INFORMATION SUMMARY This will be the first meeting of the Budget Committee since the budget meetings in April. Items on the agenda include: • Discuss the status of Fiscal Year 2012 audit. • Present the 1st Quarter FY 2013 Financial Report. • Discuss the progress on forming the Audit Committee. • Debrief on the Fiscal Year 2013 budget cycle process, and determine if any changes will be necessary for the Fiscal Year 2014 budget process. • Discuss the status of the Financial Plan document for Tigard and the Mayor's Blue Ribbon Task Force. OTHER ALTERNATIVES N/A COUNCIL OR CCDA GOALS, POLICIES, MASTER PLANS 2. Financial Stability DATES OF PREVIOUS CONSIDERATION N/A Attachments No file(s) attached - = FY 2013 City Operating Budget Flowchart Legend Process Direct Data Input Capital Prior Fiscal Year Improvement Financial Forecast I Budget Data Program Audit Decisions p roduced g / A document Internal Kickoff Meeting produced Process J w/ CIP ,..______,----- Management Prelim work wi Team Auditors O -Receive final /�� invoices from p /y� Q Capital Needs Depts. /' ,// Assessment -Clo • fto:r F / developed from /O4 l - Master Plans - Existing CIP ' I City Staff -490964 [ ft' Public Comment ' " b 3 i Period (Sept -Oct) includes project nominations via /' / 4-ad / 2 Neighborhood \ Networks Program L V Public E project C nominations N Prepare Financials submitted to 0 Engineering Cf) —44111111. PW evaluates project lists and prepares CIP Project Request Forms I inance Internal Process 'W prepares project list to be !' ranked / / Prepare Final field work I framework in with Auditors V budget system \ L _o Present lists to 0 citizen committees 0 TTAC & PRAB for O ranking VP I V • IP ream & Citize FIN ZCOmmittees prioritize Forecast projects on ranking i- lo criteria V Upload Comprehensive audited I\ L Annual Financial actuals & ' FIN meets i Report (CAFR) is staffing data to .0 forecast and / 0 Staff& D a atd on indices published budget system �) List of prioritized > projects presented O to City Manager assumptions Z • � � -.1. - - a . 2 City Operating Budget Flowchart Capital Prior Fiscal Year Improvement Financial Forecast Budget Audit Program PW provides FIN Forecast w/ updated list of f - updated CIP projects & costs . - , Auditor's report to Initial oreca Audit Committe, a) reviewed w/ E - O ' CIP Team Staff and D a) evaluates & N ranks projects ' tnance nterna Process City Manager approves initi provides budgets/ forecast Instructions to departments 7 PW provides final Dept. budgets due CIP project list w/ to Finance & new costs to FIN for ^ FTE /Reclass Proposed Budget forms due to HR Soc. Service / Dept. budge Community Events C meetings w/ ■ (0 Finance & Applications sent out • V • % Schedules Social Forecasts upda bept. meetings w Service w/ Dept requests City Manager subcommittee meeting Neighborhood • Network Open • L+ House - CIP and Send tax 03 its process HR FTE & reclass abatement = reports due to applications L - Finance U) LL \ f \ Soc Sery /Comm Events Grants due & distributed to Exec Staff, subcommittee, , Meet w/ City /Meet w/ City � and City Recorder C Manager on Manager on C I Budget/ C Proposed Budget/ CIP CIP / Revised 10/16/2012 ;, ,�. City Operating Budget Flowchart Capital Prior Fiscal Year Improvement Financial Forecast Budget Audit /finance Internal Proce Program illiMilliffillii FIN meetings w/ Tax Abatement City Manager to finalize Proposed ! letters due to Budget Finance I • Submit Comm ' Events packet to Council -C ' orecast update i for Propo • CO Budg 2 Meetings with Council & Subcommittee to review Comm Evts grants V • V Budget /CCDA Proposed d Budget hearing notice to published Tigard Times "L Q F IN prepares white papers I Budgets issued to Budget Committee V Revisions to CIP for • Approved Budget Budget Submit financial Committee summary form to /- Meetings Washington County i II _ -v FIN prepare technical City Council packets >, Budget Committee adjustments for I I due to City Recorder a5 approves CIP hearing I 2 consideration S • N CIP adopted by Operating budget local filings to C Council & CCDA budget State & Government D adopted by I Finance Officers Council Assoc. in July Revised. 10/16/2012 SUPPLEMENTAL PACKET FOR (DATE OF MEETING) 2010 2011 2012 2013 2014 2015 2016 2017 '45e12 6/s f e Annual Expenditures 29,280,000 28,630,000 29,400,000 27,980,000 29,160,000 30,110,000 31,190,000 31,940,000 ^/0 3 Annual Revenues 28,860,000 28,610,000 28,330,000 28,700,000 29,580,000 30,520,000 31,330,000 32,220,000 Required EFB for Next Year 6,130,000 6,680,000 6,150,000 6,410,000 6,620,000 6,860,000 7,020,000 7,020,000 Ending Fund Balance 7,340,000 7,330,000 6,260,000 7,050,000 7,470,000 7,880,000 8,020,000 8,300,000 General Fund Forecast Adopted 35,000,000 ---- - - - --- - -- •--- ---- - -- - -- - - - - -- - 30,000,000 - -- - - -- -- - - - - -- - - -- ` -- - - - - - -- - - - -- 25,000,000 � ------- - - - - -- - - - -- - -- - - - - - - -- - - -- - - - 20,000,000 -' - -- - - - -- - - -- -- • 15,000,000 - -• - -- - - -- - -- - - - - - - -- - - - ' 10,000,000 ---------•-------------------- 5,000,000 -- j_T::T- 2010 2011 2012 2013 2014 2015 2016 2017 (5,000,0O0) _ - - - - - -- - - - . ! NM Ending Fund Balance Annual Expenditures Annual Revenues Required EFB for Next Year t 2010 2011 2012 2013 2014 2015 2016 2017 Annual Expenditures 29,280,000 28,630,000 29,400,000 27,980,000 29,660,000 30,630,000 31,740,000 32,510,000 Annual Revenues 28,860,000 28,610,000 28,330,000 28,700,000 29,580,000 30,520,000 31,330,000 32,220,000 Required EFB for Next Year 6,130,000 6,680,000 6,150,000 6,520,000 6,730,000 6,980,000 7,150,000 7,150,000 Ending Fund Balance 7,340,000 7,330,000 6,260,000 7,050,000 6,970,000 6,860,000 6,450,000 6,160,000 General Fund Forecast Adopted w/ Additional Expenditures Using Electrical Franchise Revenue 35,000,000 - - - - - -- ----- - - - - -- -- -- 30,000,000 25,000,000 � --- 20,000,000 y 15,000,000 10,000,000 -- — — — i 5,000,000 f-- __ 2010 2011 2012 2013 2014 2015 2016 2017 (5,000,000) -- - — _ i3 NM Ending Fund Balance — Annual Expenditures Annual Revenues Required EFB for Next Year A I ,.S1 pp le in en i Pa (, -+ ,4 e, ck I - _, UPI t " Cit o Tigard ! "/ ° TIGARD Memorandum To: City of Tigard Budget Committee '"4 From: Toby LaFrance, Tigard Finance and Information Services Director Re: FY 2013 First Quarter Financial Report Date: October 16, 2012 Introduction I am pleased to provide you with the FY 2013 First Quarter Financial Report. Please bear in mind that the numbers on the following pages are not the official audited financials of the City of Tigard. This means that the amounts represent the current fiscal situation of the City but may change with further accounting review. How to Read the Report The tables on the following pages report the progress against budget through the first three months of the fiscal year. Each page contains funds that are grouped to a similar purpose (e.g. transportation funds, water funds, etc). For each fund, the table provides the amount of the budget, the progress against budget and the percent of budget complete. At the top of the page are the resources for each fund. The resources start with the funds' Beginning Fund Balance, which represents the amount of savings in the fund at the beginning of the fiscal year. Next are the revenues of the fund grouped by revenue type. For more information on the particular revenues within a revenue type, see the Revenue Analysis section and the Fund Summaries section of the Adopted FY 2013 Budget Document. The Beginning Fund Balance plus the Revenues make up the Total Resources of the funds. The bottom half of the report shows the fund Requirements. The Requirements start with the Expenditures by type. For more information on the specific expenditures within a type, see the Program Summaries section and the Fund Summaries section of the Adopted FY 2013 Budget Documents. By subtracting the Total Expenditures from the available Total Resources, the Change is Fund Balance is calculated. By combining the Change in Fund Balance and the Beginning Fund Balance at the top of the page, the Ending Fund Balance is derived. Finally, the Ending Fund Balance is added to the Total Expenditures to calculate the Total Requirements. The Total Requirements equals the Total Resources to balance the budget. Summary of Findings This is a brief overall summary. Again, bear in mind that the financials here are not the official audited financials of Tigard, but represent the current financial situation and may change with further accounting review. 1. Budget amounts reflect the one budget adjustment that has been adopted by Council since the budget was adopted. 2. While we are 25% of the way through the fiscal year, it is expected that some operations will be over 25% spent. The reason is that we are paid 26 times per year (every two weeks) and there were three payrolls in August. This means that we have had 7 of 26 payrolls this quarter, or 27% of payroll. Since payroll is the largest expense in most operations, several of our operations are near 27% of budget through the first quarter. 3. One of the main assumptions in our General Fund forecast is that we spend at, or below, 95% of budget. At this point, we are slightly above this expenditure rate. We will continue to monitor this development. 4. Operating Expenditures for all programs in all funds are at, or under, 26 percent spent. 5. General Fund revenues are well below 25 percent. This is expected since Property Taxes are mostly received in November and December. 6. In the first quarter, General Fund Expenditures exceed revenues by approximately $5.0 million, leaving an ending fund balance of $2.3 million. It is anticipated that there will be less than $1.0 million in the ending fund balance prior to property tax collections in November. This supports staff's and the Budget Committee's discussion of a minimum reserve of $6.5 million in the General Fund at budget adoption. 7. Some capital funds are over the 25% pace due to the timing of projects. a. One area where this is true is in parks (page 4) with the recent park land purchase of the Fields Property, using Parks SDC and Parks Bond resources. b. Another area is in the Street Maintenance Fee fund (page 6) where most of the work for the year is conducted in the first two months of year. This is also a time to highlight the city's new practice of directly charging staff time to projects. Prior to FY 2013, staff time in Engineering, and related areas, was indirectly allocated to CIP projects. As we go through the year, we will be evaluating how well we estimated staff time and may need to make adjustments. The Pavement Management Program, which is funded by the Street Maintenance Fee, is one area where we may have underestimated the amount of staff time involved. 8. The revenue in the Gas Tax and City Gas Tax fund (page 6) is below budget. This is due to the timing in collections from the State. Finance expects to achieve the budgeted revenue. Finance will continue to monitor this item. 9. Expenditures in the Water CIP fund (page 10) are below pace due to the timing of invoices from Lake Oswego. Generally, they bill quarterly based on their actual expenditures. We anticipate receiving the first quarter bill soon. Follow -up from Last Quarterly Report of the Fiscal Year 10. There is no follow -up. Since this is the first report of the fiscal year. '.A FY 2013 - October Report (July thru Sept. - 25% of the year) General Fund General Fund - 100 Budget YTD* % of Budget Resources Beginning Fund Balance 6,341,359 7,264,797 115% Revenues Taxes 12,726,427 42,872 0% Franchise Fees 4,966,611 788,914 16% Special Assessments - - 0% Licenses & Permits 882,300 197,704 22% Intergovernmental 5,671,652 210,406 4% Charges for Services 3,142,995 646,711 21% Fines & Forfeitures 1,063,126 271,060 25% Investment Earnings 103,722 17,811 17% Other Revenue 24,655 23,618 96% Proceeds from Loan Repaymen 280,000 - 0% Transfers In 70,000 19,884 28% . .._, 8 % Total Resources 35,272,847 9,483,777 27 °,io Requirements Expenditures Policy & Administration 748,857 169,576 23% Community Development 2,965,740 767,737 26% Community Services 19,966,567 5,008,657 25% Public Works 5,163,623 1,242,117 24% Debt Service - - 0% Capital Improvement - - 0% Loan to CCDA 80,000 - 0% Transfers Out 623,264 4,167 1% Contingency 966,075 - 0% Total Expo 4.04...xemsemmeman Change in Fund Balance (1,582,638) (4,973,274) 314% Ending Fund Balance 4,758,721 2,291,524 48% Total Requirements 35,272,847 9,483,777 27% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 1 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Central Service Funds Central Svc Fund - 600 Fleet /Prop Mngmt Fund - 650 Insurance Fund - 660 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 518.468 213.796 Llfg 115.817 135.776 117% 792.663 811,896 102% Revenues Taxes - - 0% - - 0% - - 0% Franchise Fees - - 0% - - 0% - - 0% Special Assessments 0% - - 0% - - 0% Licenses & Permits - - 0% - - 0% - - 0% Intergovernmental - - 0% - - 0% - - 0% Charges for Services 5,979,588 1,492,498 25% 1,506,121 366,404 24% - - 0% Fines & Forfeitures - - 0% - - 0% - - 0% Investment Earnings 593 355 60% - 104 0% 7,810 380 5% Other Revenue - - 0% - 2,980 0% 52,936 7,895 15% Proceeds from Loan Repaymen - - 0% - - 0% - - 0% Transfers In 282.477 70,619 25% 15,200 13,926 92% - 0o Total Revenues 1,563,472 25% 1,521,321 383,414 25% 60,746 8,275 14% Total Resources 6,781,126 1,777,269 26% 1,637,138 519,191 32% 853,409 820,170 96% Requirements Expenditures Policy & Administration 6,292,137 1,471,914 23% - - 0% 100,000 20,000 20% Community Development - 0% - - 0% - - 0% Community Services - - 0% - - 0% - - 0% Public Works - - 0% 1,589,871 335,674 21% - - 0% Debt Service - - 0% - - 0% - - 0% Capital Improvement - - 0% - - 0% - - 0% Loan to CCDA - - 0% - - 0% - - 0% Transfers Out - - 0% - - 0% 870 218 25% Contingency 300.000 - 0°L 25.300 - 026 10.000 - 0% Change in Fund Balance (329,479) 91,559 -28% (93,850) 47,741 -51% (50,124) (11,943) 24% Ending Fund Balance 188,989 305,355 162% 21,967 183,517 835% 742,539 799,953 108% Total Requirements 6,781,126 1,777,269 26% 1,637,138 519,191 32% 853,409 820,170 96% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 2 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Development Funds Building Fund - 230 Elec. Insp. Fund - 220 Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 602,913 933,406 155% 112,766 124,797 111% Revenues Taxes - - 0% - - 0% Franchise Fees - - 0% - - 0% Special Assessments - - 0% - - 0% Licenses & Permits 986,974 323,402 33% 167,037 47,986 29% Intergovernmental 8,281 - 0% - - 0% Charges for Services 2,003 1,026 51% - - 0% Fines & Forfeitures - - 0% - - 0% Investment Earnings 19,782 443 2% 1,207 92 8% Other Revenue 9,990 3 0% - - 0% Proceeds from Loan Repaymen - - 0% - - 0% Transfers In 200,000 - 0% - - 0% Total Revenues 1,2270 324,813 26% 168,244 48,079 29" Total Resources 1,829,943 1,258,279 69% 281,010 172,875 62% Requirements Expenditures Policy & Administration - - 0% - - 0% Community Development 1,266,424 324,117 26% - - 0% Community Services - - 0% - - 0% Public Works - - 0% - - 0% Debt Service - - 0% - - 0% Capital Improvement - - 0% - - 0% Loan to CCDA - - 0% - - 0% Transfers Out - - 0% 202,827 707 0% Contingency 200,000 - 0% 50.000 - 0% Change in Fund Balance (239,394) 757 0% (84,583) 47,372 -56% Ending Fund Balance 363,519 934,163 257% 28,183 172,168 611% Total Requirements _ 1,829,943 1,258,279 69% 281,010 172,875 62% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 3 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Parks Funds Parks Capital Fund - 420 Parks Bond Fund - 421 Parks SDC Fund - 425 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 141,884 52.934 37% 6,170,647 5.903.399 96% 2.910.897 2.326.272 80% Revenues Faxes - 0% 0% - 0% Franchise Fees 0% - 0% - - O% Special Assessments - - 0% - - 0% - - 0% Licenses & Permits - - 0% - - 0% 257,825 184,214 71% Intergovernmental 34,000 - 0% - - 0% - - 0% Charges for Services - - 0% - - 0% 0% Fines & Forfeitures - - 0% - - 0% - - 0% Investment Earnings 3,015 47 2% 4,020 6,880 171% 19,782 1,089 6% Other Revenue - 15,436 0% - - 0% - 0% Proceeds from Loan Repaymen - - 0% - - 0% - - 0% Transfers In 6.448.628 2,184,580 34% - - 0% - - 0% Total Revenues 2,200,062 34% 4,020 6,880 171% 277,607 185,303 6 Total Resources 6,627,527 2,252,996 34% 6,174,667 5,910,279 96% 3,188,504 2,511,575 79% Requirements Expenditures Policy & Administration - - 0% - - 0% - - 0% Community Development - - 0% - - 0% - - 0% Community Services - - 0% - - 0% - - 0% Public Works - - 0% - - 0% - - 0% Debt Service - - 0% - - 0% - - 0% Capital Improvement 6,619,628 2,186,091 33% - - 0% - - 0% Loan to CCDA - - 0% - - 0% - - 0% Transfers Out - - 0% 4,977,628 1,162,199 23% 1,181,325 1,013,106 86% Contingency - - 0°L - - 07 91.000 - 00% Total Expenditures y ° . 40 y -. - - -- t Change in Fund Balance (133,985) 13,972 -10% (4,973,608) (1,155,319) 23% (994,718) (827,803) 83% Ending Fund Balance 7,899 66,906 847% 1,197,039 4,748,079 397 1,916,179 1,498,470 78% Total Requirements 6,627,527 2,252,996 _ 34% 6,174,667 5,910,279 96% 3,188,504 2,511,575 79% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 4 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Parks Funds Urban Forestry Fund Budget YTD* % of Budget Resources Beginning Fund Balance 1,165,876 1,175,199 101% Revenues Taxes - - 0% Franchise Fees - - 0% Special Assessments - - 0% Licenses & Permits - - 0% Intergovernmental - - 0% Charges for Services 25,000 60,000 240% Fines & Forfeitures - - 0% Investment Earnings 4,060 669 16% Other Revenue - 0% Proceeds from Loan Repaymen - 0% Transfers In - 0% Total - - nu 9,060 Total Revenues 29 060 61 209% Resources 1,194,936 1,235,867 103% Requirements Expenditures Policy & Administration - - 0% Community Development - - 0% Community Services - - 0% Public Works - - 0% Debt Service - - 0% Capital Improvement - 315 0% Loan to CCDA - - 0% Transfers Out 152,710 9,884 6% Contingency - - 0% Change in Fund Balance (123,650) 50,469 -41% Ending Fund Balance 1,042,226 1,225,668 118% Total Requirements 1,194,936 1,235,867 103% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 5 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Transportation Funds Gas Tax Fund - 200 City Gas Tax Fund - 205 Street Maint. Fee Fund - 412 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 1.690.204 1.645.133 97% 894.975 1,003,162 112% 774.860 1.038.949 134% Revenues Taxes 0% 0% - - 0% Franchise Fees - - 0% - 0% - - 0% Special Assessments - - 0% - - 0% - - 0% Licenses & Permits 2,602 - 0% - - 0% - - 0% Intergovernmental 3,621,560 446,338 12% 731,302 54,551 7% - - 0% Charges for Services - - 0% - 0% 1,903,072 433,403 23% Fines & Forfeitures - - 0% - - 0% - - 0% Investment Earnings 55,732 19,938 36% 34,584 4,274 12% 2,043 348 17% Other Revenue 59,700 1,771 3% 31,421 - 0% - - 0% Proceeds from Loan Repaymen - - 0% - - 0% - - 0% Transfers In 100,000 - �° - - 0% - - Q evenues 3,839,594 468,048 12. 58,825 Total Resources 5,529,798 2,113,180 38% 1,692,282 1,061,986 63% 2,679,975 1,472,700 55% Requirements Expenditures Policy & Administration - - 0% - 0% - - 0% Community Development - - 0% - - 0% - - 0% Community Services - - 0% - 0% - - 0% Public Works 2,229,010 432,784 19% - 0% - - 0% Debt Service 615,928 - 0% 324,420 0% - - 0% Capital Improvement - - 0% - 0% 1,470,000 1,308,135 89% Loan to CCDA - - 0% - - 0% - - 0% Transfers Out 2,290,163 106,936 5% 3,271 818 25% 193,645 23,411 12% Contingency 251,970 UN 50,000 - QN 150,000 - Tat inf In= ___ a 818 Change in Fund Balance (1,547,477) (71,672) 5 419,616 58,007 14% 91,470 (897,795) - 982% Ending Fund Balance 142,727 1,573,461 1102% 1,314,591 1,061,169 81% 866,330 141,154 16% Total Requirements 5,529,798 2,113,180 38% 1,692,282 1,061,986 63% 2,679,975 1,472,700 55% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 6 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Transportation Funds (Continued) TDT Fund - 405 TIF Fund - 410 Underground Util. Fund - 411 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 304.935 951,050 312% 855.972 885.315 103% 528.471 532.555 101% Revenues Taxes - - 0% - - 0% - 0% Franchise Fees - - 0% - 0% - - 0% Special Assessments - - 0% - - 0% - - 0% Licenses & Permits 176,678 166,510 94% - - 0% 15,629 - 0% Intergovernmental - - 0% - - 0% - 0% Charges for Services - - 0% - 0% - - 0% Fines & Forfeitures - - 0% - - 0% - - 0% Investment Earnings 11,279 388 3% 4,000 454 11% 7,160 229 3% Other Revenue - - 0% - - 0% - - 0% Proceeds from Loan Repayment - - 0% - - 0% - - 0% Transfers In - - Tip_ - - 0% - - 0% Tota evelt►u�g - i ,.. ,. , . -., , . 4,000 454 , . r _ } ; 229 Total Resources 492,892 1,117,947 227% 859,972 885,769 103% 551,260 532,784 97% Requirements Expenditures Policy & Administration - 0% - - 0% - - 0% Community Development - 0% - 0% - - 0% Community Services - - 0% - - 0% - - 0% Public Works - - 0% - - 0% - - 0% Debt Service - - 0% - - 0% - - 0% Capital Improvement - 0% - 0% - - 0% Loan to CCDA - - 0% - - 0% - - 0% Transfers Out 244,818 6,537 3% 636,861 2,840 0% 162 40 25% Contingency 40,000 - 0% 20.000 - 04 - - 026 Total Expe truces 284,818 % - 655Si 2,840 Change in Fund Balance (96,861) 160,360 - 166% (652,861) (2,386) 0% 22,627 188 1% Ending Fund Balance 208,074 1,111,410 534% 203,111 882,929 435% 551,098 532,743 97% Total Requirements 492,892 1,117,947 227% 859,972 885,769 103% 551,260 532,784 97% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 7 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Transportation Funds (Continued) Trans Capital Proj Fund - 460 Budget YTD* % of Budget Resources Beginning Fund Balance 71,086 92,333 130% Revenues Taxes - - 0% Franchise Fees - - 0% Special Assessments - - 0% Licenses & Permits - - 0% Intergovernmental 153,970 - 0% Charges for Services - - 0% Fines & Forfeitures - - 0% Investment Earnings - 67 0% Other Revenue - - 0% Proceeds from Loan Repaymen - - 0% Transfers In 3,371,749 115,987 3% Total revenues 3,52 5 719 116 ,054 3 % __ ■ Total Resources 3,596,805 208,387 6 °'o Requirements Expenditures Policy & Administration - - 0% Community Development - - 0% Community Services - - 0% Public Works - - 0% Debt Service - - 0% Capital Improvement 3,560,719 140,543 4% Loan to CCDA - - 0% Transfers Out - - 0% Contingency - 0% Total Expenditures 3,560,719 140,543 4% Change in Fund Balance (35,000) (24,489) 70% Ending Fund Balance 36,086 67,844 188% Total Requirements 3,596,805 208,387 6% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 8 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Sani / Stormwater Funds Sanitary Sewer Fund - 500 Stormwater Fund - 510 Water Qual /Quant Fund - 511 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 6.844.337 7.403.656 108% 1.084.671 2.195.002 202% 1,570,645 1,570,633 100% Revenues Taxes - - 0% - - 0% - - 0% Franchise Fees - - 0% - - 0% - - 0% Special Assessments - - 0% - - 0% - - 0% Licenses & Permits 25,750 8,653 34% - - 0% 4,250 1,925 45% Intergovernmental 152,500 - 0% - - 0% - - 0% Charges for Services 1,283,300 283,135 22% 1,948,353 615,409 32% - - 0% Fines & Forfeitures - - 0% - - 0% - - 0% Investment Earnings 100,333 3,171 3% 7,936 871 11% 15,102 679 4% Other Revenue 127,513 28,560 22% - 728 0% - 0% Proceeds from Loan Repaymen - - 0% - - 0% - - 0% Transfers In 329.000 - 0n 103,014 - 0% - - Q%q Totallteven 323,519 3 617,007 30% 19,352 - 2,604 MINIM Total Resources 8,862,733 7,727,175 87% 3,143,974 2,812,009 89% 1,589,997 1,573,236 99% Requirements Expenditures Policy & Administration - - 0% - - 0% - 0% Community Development - - 0% - - 0% - 0% Community Services - - 0% - - 0% - - 0% Public Works 1,560,427 347,702 22% 1,652,460 349,487 21% - - 0% Debt Service - - 0% - - 0% - 0% Capital Improvement 4,121,388 465,136 11% 331,807 45,299 14% - - 0% Loan to CCDA 200,000 - 0% - - 0% - - 0% Transfers Out 170,163 1,987 1% 173,356 774 0% 347,616 4,654 1% Contingency 159.986 - Doze 100.000 - - ° �4 Total Expendit effir§ .. - Change in Fund Balance (4,193,568) (491,306) 12% (198,320) 221,447 -112% (328,264) (2,050) 1% Ending Fund Balance 2,650,769 6,912,351 261% 886,351 2,416,449 273% 1,242,381 1,568,582 126% Total Requirements _ 8,862,733 - 7,727,175 87% 3,143,974 2,812,009 - 89% 1,589,997 1,573,236 99% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 9 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Water Funds Water Fund - 530 Water SDC Fund - 531 Water CIP Fund - 532 Budget YTD* % of Budget Budget YTD* % of Budge . Budget YTD* % of Budget Resources Beginning Fund Balance 6.300.490 8.427.291 1.3426 730340 1.536.402 210% 90.000.000 93.177.930 104% Revenues Taxes - 0% - - 0% - - 0% Franchise Fees - - 0% - - 0% - 0% Special Assessments - - 0% - - 0% - - 0% Licenses & Permits 10,030 8,483 85% 361,575 378,381 105% - - 0% Intergovernmental - 0% - 0% - 0% Charges for Services 13,201,296 3,835,427 29% - - 0% - - 0% Fines & Forfeitures - - 0% - 0% - 0% Investment Earnings 30,644 3,524 11% 233 817 351% 13,096 112 1% Other Revenue 9,673 0% - - 0% - - 0% Proceeds from Loan Repayment - - 0% - - 0% - - 0% Transfers In 58,751 0% - Q°Z 908,671 7,476 plc, Total Revn eueiW - 13,300,721 3,857,106 29% 361,808 379,198 __ 921,767 7,588 Total Resources 19,601,211 12,284,397 63% 1,092,348 1,915,600 175% 90,921,767 93,185,518 102 °i9 Requirements Expenditures Policy & Administration - 0% - 0% - - 0% Community Development - - 0% - - 0% - - 0% Community Services - - 0% - 0% - - 0% Public Works 7,950,086 1,598,887 20% - 0% - - 0% Debt Service - - 0% - 0% - 0% Capital Improvement - - 0% - 0% 22,706,500 568,948 3% Loan to CCDA - - 0% - - 0% - - 0% Transfers Out 4,660,675 10,517 0% 272,306 1,294 0% 132,452 33,113 25% Contingency 500.000 - 0% - - 0 - - 0°L a tturea 1,609,404 12% 272,306 , .**' ' ' . •.`' •' Change in Fund Balance 189,960 2,247,703 1183% 89,502 377,904 422% (21,917,185) (594,473) 3% Ending Fund Balance 6,490,450 10,674,993 164% 820,042 1,914,306 233% 68,082,815 92,583,457 136% ' Total Requirements - 19,601,211 12,284,397 63% 1,092,348 1,915,600 175% 90,921,767 93,185,518 102% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 10 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Water Funds Water Debt Svc Fund - 533 Budget YTD* % of Budget Resources Beginning Fund Balance 8,900,000 6,569,045 74% Revenues Taxes - - 0% Franchise Fees - - 0% Special Assessments - - 0% Licenses & Permits - - 0% Intergovernmental - - 0% Charges for Services - - 0% Fines & Forfeitures - - 0% Investment Earnings - 9,882 0% Other Revenue - - 0% Proceeds from Loan Repaymen - - 0% Transfers In 3,961,184 - 0% Total Revenues 3,961,184 9,882 0% Total Resources 12,861,184 6,578,927 51% Requirements Expenditures Policy & Administration - - 0% Community Development - - 0% Community Services - 0% Public Works - - 0% Debt Service 3,961,184 - 0% Capital Improvement - - 0% Loan to CCDA - 0% Transfers Out - - 0% Contingency - - 0% Total Expenditures 3,961,184 - 0% Change in Fund Balance - 9,882 0% Ending Fund Balance 8,900,000 6,578,927 74% Total Requirements 12,861,184 6,578,927 51% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 11 of 13 FY 2013 - October Report (July thru Sept. - 25% of the year) Debt Service and Other Funds GO Debt Svc Fund - 350 Bancroft Debt Svc Fund - 300 Libr. Donations /Bequests - 98( Criminal Forfeiture Fund - 240 Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Budget YTD* % of Budget Resources Beginning Fund Balance 309.160 272.622 88% 362.533 367.466 1Q1. ° L 376.045 474.398 126% 70.000 53.124 76 °r% Revenues Taxes 2,264,561 6,316 0% - - 0% - - 0% - - 0% Franchise Fees - - 0% - - 0% - - 0° i. - 0% Special Assessments - - 0% 120,000 - 0 - - 0 °-o - - 0% Licenses & Permits - - 0% - - 0% - - 0 °'6 - - 0% Intergovernmental - 0% - - 0% - - 0% - - 0% Charges for Services - - 0% - - 0% - - 0% - - 0% Fines & Forfeitures - - 0% - - 0% - 0% 10,600 4,111 39% Investment Earnings 4,612 619 13% 37,468 164 0% - 250 0% 1,892 13 1% Other Revenue - - 0% - - 0% - - 0% - - 0% Proceeds from Loan Repayment - - 0% - - 0% - - 0% - - 0% Transfers In - - 0% - - 0% - - n Total Resources 2,578,333 279,557 11% 520,001 367,630 71 °%o 376,045 474,648 126 ° /s 82,492 57,249 69% Requirements Expenditures Policy & Administration - - 0% - - 0% - - 0% - - 0% Community Development - - 0% - - 0% - - 0% - - 0% Community Services - - 0% - - 0% - - (% - - 0% Public Works - - 0/s - - 0% - - 0% - - 0% Debt Service 2,191,504 - 0% 118,621 - 0% - - 0% - - 0% Capital Improvement - - 0% - - 0% - - 0% - - (1% Loan to CCDA - - 0% - - 0%° - - 0% - - 0% Transfers Out - - � % 852 213 2 ( 5% � / 100,0(10 - 0 70 19,700 28% .t : I' ',OIL 4' - - a re � a �O ( i vii - - TA - - - vL .. : -. -. `.. ♦- ...:.. :: -. : - ... _ ., : .. - � _ . _...._ ..i.N- ) .i6e. � W -ain ., r .'.'3?esXttx.{14 =.- ..viri� °.1e�!� ++av Change in Fund Balance 77,669 6,935 9% 37,995 (49) 0% (100,000) 250 (1% (57,508) (15,576) 27% Ending Fund Balance 386,829 279,557 72% 400,528 367,417 92% 276,045 474,648 172% 12,492 37,549 301% Total Requirements 2,578,333 - 279,557 - 11 °%o 520,001 367,630 71% 376,045 474,648 126% 82,492 57,249 69% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 12 of 13 c FY 2013 - October Report (July thru Sept. - 25% of the year) Capital Projects Funds Facilities Cap Proj Fund - 400 Budget YTD* % of Budget Resources Beginning Fund Balance 500,328 428,823 86% Revenues Taxes - - 0% Franchise Fees - - 0% Special Assessments - - 0% Licenses & Permits - - 0% Intergovernmental - - 0% Charges for Services - - 0% Fines & Forfeitures - - 0% Investment Earnings 3,212 190 6% Other Revenue - - 0% Proceeds from Loan Repaymen - - 0% Transfers In 731,589 3,028 0% Total Revenues 734,801 3,218 ' 0% Total Resources 1,235,129 432,041 35% Requirements Expenditures Policy & Administration - - 0% Community Development - - 0% Community Services - - 0% Public Works - - 0% Debt Service - - 0% Capital Improvement 424,598 3,028 1% Loan to CCDA - - 0% Transfers Out 8,299 2,075 25% Contingency 50,000 - 0% Change in Fund Balance 251,904 (1,884) -1% Ending Fund Balance 752,232 426,938 57% Total Requirements 1,235,129 432,041 35% *Note: Financials presented are not the official audited financials of the City of Tigard, but represent the current financial situation and may change with further accounting review. 10/16/2012 1:26 PM 13 of 13 AIS -1059 4• Workshop Meeting Meeting Date: 10/16/2012 Length (in minutes): 30 Minutes Agenda Tide: Economic Development Discussion Prepared For: Marty Wine, City Manager Submitted By: Cathy Wheatley, Administrative Services Item Type: Update, Discussion, Direct Staff Meeting Type: Council Workshop Mtg. Information ISSUE Council discussion on setting the course for an economic development strategy for Tigard. Should Tigard pursue city -wide economic development strategies, and what should they be? STAFF RECOMMENDATION / ACTION REQUEST Council discussion about desired outcomes, city strategy, and actions Tigard could take in furthering economic development, and guidance about preferred next steps. KEY FACTS AND INFORMATION SUMMARY The City of Tigard has created a foundation of adopted plans and policies that set a course for economic development strategies, many focusing on downtown Tigard, including: • Tigard Downtown Improvement Plan (2005) • City Center Urban Renewal Plan (2005) • Tigard Downtown Streetscape Plan (2006) • Development Strategy for Downtown Tigard (2007) • Fanno Creek Park and Plaza Master Plan (2008) • Tigard Downtown Future Vision (2009) • Downtown Code Update (2010) • Downtown Tigard Parking Analysis (2010) • Downtown Development Strategy Update (2011) • Capital Improvement Plans (2011 -2016) • Economic Opportunity Analysis (2011) • Tigard Triangle Master Plan (various) • Southwest Corridor planning (2010 - present) These plans contain elements of future steps and strategies that Tigard could take to brand the community, recruit and retain businesses, redevelop housing, and use data to focus city efforts and investments for development and redevelopment. Mayor Dirksen and several councilors have attended trainings and conferences, and have participated locally and regionally, to better understand and focus on economic development approaches that cities can use to develop the local economy. Councilor Woodard presented a proposal in July for a possible path for the City to focus on economic development in the future, including deciding on a strategy, choosing which action steps to take, and a vision of what economic development looks like for Tigard. The prior presentation is attached for reference. Recommendations included setting economic development organization goals; increase staffing in the organization; set up a website and links to inventories of developable land and answer the question "Why Tigard ?" OTHER ALTERNATIVES Council could choose to maintain current efforts and choose not to create a more comprehensive strategy or devote the city's financial resources to furthering economic development efforts. Such a strategy would include partnerships with organizations such as the Tigard Area Chamber of Commerce, neighboring cities, and regional partners. COUNCIL GOALS, POLICIES, APPROVED MASTER PLANS Goal 1.b.ii.1 Take the Next Step on Major Projects: Implement the Comprehensive Plan through code revisions, including Contribute to the SW Corridor Plan by adopting Tigard's land use policies and designations and identifying priorities for high capacity transit (HCT) station location alternatives by mid -2012. Determine the economic development opportunities, development plan, city policies and regulations needed to position the Tigard Triangle as an HCT station location. Goal 3. Identify a geographic - opportunity area in the downtown with the greatest potential to create a catalyst for further development. Concentrate most resources there. Five year Council goals include: Explore Pacific Highway Urban Renewal District as part of a citywide economic development strategy. DATES OF PREVIOUS COUNCIL CONSIDERATION Discussed several times by the City Council. This discussion is a continuation of the July 10, 2012 presentation by Councilor Woodard. Attachments No file(s) attached. Carol Krager From: Cathy Wheatley Sent: Monday, October 15, 2012 8:47 AM To: Carol Krager Subject: FW: Council discussion about economic development, October 16 Attachments: Economic Development in Municipalities [Read- Only].pdf; Cathy Wheatley.vcf Alegeet,174*7 /t4 . SUPPLEMENTAL PACKET Cathy Wheatley FOR Oct /6 ao/a— , City of Tigard (DATE OF MEETING) It City Recorder /Records Supervisor Administration cathy @ tgard- or.gov Tigard, OR 97223 USA (503) 718 -2410 From: Marty Wine Sent: Sunday, October 14, 2012 7:39 AM To: Councilmail Councilmail Cc: Liz Newton; Cathy Wheatley; Tom McGuire; Sean Farrelly Subject: Council discussion about economic development, October 16 Dear City Councilors, At this week's workshop the rescheduled discussion of economic development is planned. Mayor Dirksen reminded us that there are two documents that may be useful to you in preparation that were not attached to this week's AIS, although they were part of prior discussions. First is the presentation made by Councilor Woodard in July summarizing his perspectives about economic development in cities. It is attached in pdf format. Second is the City's Economic Opportunities Analysis. (Click on link to City website to view.) This was adopted as part of the City's Comprehensive Plan by the City Council in May 2011. If you asked me the starting elements of a city economic development strategy, this document and several of our adopted plans would be the data -based starting point for such a strategy. Because of other commitments, Greater Portland, Inc. and the majority of the Planning Commission members cannot attend this Tuesday night, but you will have the majority of the CCAC members joining you for your discussion. While this is a workshop meeting and no decisions are asked of Council, I would hope that we could make progress in answering the question "what does economic development mean for Tigard ?" and "what should be the city's role and next steps in pursuing economic development at the city level ?" Thanks, and see you Tuesday. Marty 1 M S Marty Wine City Manager DIRECT SO3-7]8-2486 CELL 971 -2S8 -8877 EMAIL marty@trgard WEB www.tigard- or.gov City of Tigard 1 CITY MANAGEMENT 13125 SW Hall Boulevard, Tigard, OR 97223 DISCLAIMER: E -mails sent or received by City of Tigard employees are subject to public record laws. If requested, e-mail may be disclosed to another party unless exempt from disclosure under Oregon Public Records Law. E -mails are retained by the City of Tigard in compliance with the Oregon Administrative Rules "City General Records Retention Schedule." 2 4geno/4 /� � SU PACKET FOR (DATE OF MEETING) City of Tigard 2011 Economic Opportunities Analysis Adopted by Tigard City Council on May 24, 2011 Prepared By Cogan Owens Cogan, LLC FCS GROUP This report was funded by an Oregon Department of Land Conservation and Development Department Periodic Review Grant. ACKNOWLEDGEMENTS Tigard City Council Craig Dirksen, Mayor Gretchen Buehner, Council President Marland Henderson Nick Wilson Mark Woodard Tigard Planning Commission /Advisory Committee David Walsh, President Tom Anderson, Vice President Margaret Doherty Stuart Hasman Matthew Muldoon Karen Ryan Jason Rogers Donald Schmidt Richard Shavey Cogan Owens Cogan, LLC Kirstin Greene, AICP, Managing Principal Steve Faust, AICP, Senior Planner Ellie Fiore, AICP, Senior Planner FCS Group Todd Chase, AICP, Senior Economist City of Tigard Staff Ron Bunch, Community Development Director Susan Hartnett, AICP, Assistant Community Development Director Craig Prosser, City Manager Darren Wyss, Senior Planner and Project Manager Sean Farrel ly, Redevelopment Project Manager TABLE OF CONTENTS Executive Summary — i Introduction — 1 Economic Development Vision and Goals — 1 Economic Trends Analysis — 2 Business Clusters Analysis — 9 Targeted Business Clusters — 12 Site Suitability Analysis (Land Demand) — 13 Inventory of Suitable Sites (Land Supply) — 16 Short-Term Land Supply Determination — 18 Assessment of Potential (Reconciliation of Demand and Supply) —19 Short-Term Land Need Determination — 19 Long-Term Land Need Determination — 19 Planning Market, Cost and Risk Factors - 21 Implementation Policies and Action Measures —22 Policies —22 Recommended Action Measures —23 Appendices A. Office Leasing Activity Summary, Mid-Year Report —26 B. Industrial Leasing Activity, Mid-Year 2010 Report —27 C. Analysis of Employment and Space Needs —28 D. Analysis of Retail Inflow/Outflow —32 E. Summary of Tigard Employment Zones and Regulations —33 F. Typical Site Requirements for Development Types — 37 G. Buildable Land Inventory —38 H. Redevelopment Land Inventory —39 I. Summary of Stakeholder Interviews —40 J. Map of Buildable Lands and Redevelopment/Refill Potential —44 Executive Summary The City of Tigard has conducted an Economic Opportunities Analysis (EOA) as required by its Periodic Review work program to update its Comprehensive Plan. The City received grant funds from the Department of Land Conservation and Development (DLCD) for technical consultant assistance to complete this task. The EOA was developed in compliance with OAR 660 Division 9 (Statewide Planning Goal 9: Economic Development). The EOA is in -part a technically -based study that compares projected demand for land for industrial and other employment uses to the existing supply of such land. At the same time, it provides economic development policies and actions consistent with emerging economic opportunities, market trends, and local vision Vision and Goals In March 2008, as part of a robust public process, the City of Tigard updated the Economic Development chapter of its Comprehensive Plan. The chapter included the City's vision and goals for economic development to read: Vision The City shall have a strong and resilient local economy with a diverse portfolio of economic activity: retail, professional service and industrial jobs. Goals 1. Develop and maintain a strong, diversified and sustainable local economy. 2. Make Tigard a center and incubator for innovative businesses including those that focus on environmental sustainability. 3. Make Tigard a prosperous and desirable place to live and do business. Demographic and Employment Trends Tigard has been increasing in population at a slower rate (1.3 %) than Washington County, but above Oregon and national growth rates. Tigard population is estimated to be 47,460 as of 2009, up from 42,260 residents in 2,000. Tigard currently is relatively "jobs rich" with a positive ratio of 2.3 jobs per household, which is well above the tri- county Metro regional average of 1.5 jobs per household. This is understandable given Tigard's concentration of regional employment centers, including Washington Square Mall, the "Tigard Triangle" employment area near the confluence of I -5 /Hwy. 217, and pockets of industrial uses along the Hwy. 217 corridor. Tigard also is home to a number of large retail employers at Washington Square Mall as well as several large high -tech manufacturing, construction contractors, professional, business operations, and state and local government operations. Regional commercial and industrial real estate brokers see Tigard as a well- defined submarket within the suburban Metro region. Tigard's office market is especially competitive within the inner southwest portion of the region. Additionally, various efforts are underway to make the Downtown Tigard area a more viable place to live and work. Target Industries In line with Tigard's vision and goals, and in consultation with the City Planning Commission, the consultant team and City staff recommend that the City focus on retaining and attracting a mix of existing and emerging business clusters that pay above average wages. This includes existing, established clusters such as: • Durable goods manufacturing (includes metals and machinery) • Education (private and non - profits) I'ieard 2011 I;connmic Opportunities nnal}sis • Financial services • Information (including software development) • Professional and technical services • Wholesale trade They also recommend that the City focus on emerging clusters, including health care and advanced technology (i.e., green energy) manufacturing and research operations. Tigard's Land Demand and Supply The consulting team prepared a range of land need forecasts including: efficient, medium, and high land needs scenarios. These scenarios all take into account the Metro employment forecasts, but assume varying levels of industrial development and redevelopment. As summarized in the table below, the land efficient need scenario assumes 48 acres of net new industrial vacant land demand, which is just below the estimated vacant industrial land supply of 50 acres. If the City chooses to pursue a more aggressive economic growth strategy that is consistent with the moderate or high land need scenario, the City would need to identify another 14 to 30 acres of vacant industrial land area to meet the level of industrial demand associated with adding another 1,059 to 1,324 industrial jobs. 20 -Year Industrial Demand Forecast and Vacant Land Supply, Tigard USB Efficient Land Moderate Land High Land Land Demand and Supply Need Need Need Scenario Scenario Scenario Demand for Vacant Industrial 48 64 80 Land Supply of Vacant Industrial 50 50 50 Land Land Surplus or (Deficit) 2 (14) (30) Existing Forecast of Preliminary Parcel Distribution, Unconstrained Parcel Size Surplus Efficient Land Need Forecast 1 Supply (tax Demand (tax lots) lots) (tax lots) 1 / Less than 1 acre 12 10 2 1 to 5 acres 5 5 0 5 to 10 acres 0 0 0 10 to 20 acres 2 2 0 20+ acres 0 0 0 Total 19 17 2 Notes: ' Tax lot demand forecast expected to meet or exceed supply in 20 years. Source: Based on findings included in demand and supply analysis. As shown in the table below, the land efficient needs scenario assumes 78 acres of net new commercial and mixed -use vacant land demand, which is just below the estimated vacant land supply of 86 acres. As with the industrial land needs, an economic growth strategy that is consistent with the moderate or I ia, i 2 I (Ipi AILOv ii high land needs scenario would require the City to identify an additional 19 to 45 acres of vacant commercial and mixed -use land to meet the demand. Reconciliation of Long -term Land Demand and Supply Commercial and Mixed Use 20 -Year Land Use Forecast (gross buildable acres), Tigard USB Efficient Land Medium High Land Land Demand and Supply Need Scenario Land Need Need Scenario Scenario Demand for Vacant Commercial 78 105 131 Land Commercial Demand 51 68 85 Mixed -Use Demand 27 36 45 Supply of Vacant Commercial 86 86 86 Land Commercial Zoned Supply 46 46 46 Mixed -Use Zoned Supply 40 40 40 Land Surplus or (Deficit) 8 (19) (45) Preliminary Parcel Distribution, Existing Supply Forecast of Surplus Efficient Need Forecast (tax lots) Demand (tax lots) (tax lots) Less Than 1 acre 89 30 59 1 to 5 acres 14 14 0 5 to l0 acres 3 3 0 l0 to 20 acres 0 0 0 20+ acres 0 0 0 Total 106 47 59 Source: FCS GROUP, based on findings included in demand and supply analysis. Recommendations In accordance with the proposed vision and goals, the consulting team and City staff recommends the City pursue the "efficient land need scenario ". The implications of this recommendation are that the City will focus a significant portion of future employment growth and high- density housing development in its Metro - designated Town Center (Downtown); Regional Center (Washington Square); High Capacity Transit Corridor (Hwy 99W); and the Tigard Triangle. More detailed information on employment trends and projections, and land needs and supply is found throughout the remainder of the document. Tigard 211 I Economic Opportunities Analysis iii INTRODUCTION The City of Tigard has conducted an Economic Opportunities Analysis (EOA) as required by its Periodic Review work program. The City received grant funds from the Department of Land Conservation and Development (DLCD) for technical consultant assistance to complete this task. The EOA was developed in compliance with OAR 660 Division 9 (Statewide Planning Goal 9: Economic Development) and is a technical study that compares projected demand for land for industrial and other employment uses to the existing supply of such land. The purpose of the EOA is to improve opportunities for Tigard to attract and maintain the type and quality of employment desired by its citizens, grow its economy, and maintain its quality of life. Goal 9 emphasizes the preservation and protection of vacant land for industrial and employment uses. This will happen by adopting policies that ensure an adequate supply of industrial and other employment lands within the City of Tigard. The Tigard Planning Commission acted as the advisory committee for the project, reviewing each task during the process to complete the EOA. The anticipated outcomes of the project are: 1. An understanding of the characteristics of Tigard's employment lands and their adequacy to accommodate future economic activity; 2. Updated economic development policies and action measures as a basis to plan for a supply of appropriately zoned land necessary for existing businesses to expand and to accommodate future economic activities. The six tasks reviewed by the Planning Commission included: 1. Economic Development Vision and Goals 2. Economic Trends Analysis 3. Site Suitability Analysis (Land Demand) 4. Inventory of Suitable Sites (Land Supply) 5. Assessment of Potential (Reconciliation of Demand and Supply) 6. Implementation Policies and Action Measures The process and findings of these tasks are outlined in detail throughout the remainder of the EOA. This includes examining key demographic and employment opportunities and trends to assess Tigard's economic development potential, projecting employment growth, and determining short- and long- term demand for employment land. This demand is compared to an inventory of suitable commercial and industrial properties (supply) to assess the sufficiency of immediate and longer term (20 -year) supply of commercial and industrial employment land in the City's Urban Planning Area (UPA). Finally, economic development policies and action measures are recommended for inclusion in the Tigard Comprehensive Plan. ECONOMIC DEVELOPMENT VISION AND GOALS In March 2008, as part of a robust public process, the City of Tigard updated the Economic Development chapter of its Comprehensive Plan. The chapter included the City's vision and goals for economic development: 'Tigard 2011 Economic Opportunities Anal) sis Vision The City shall have a strong and resilient local economy with a diverse portfolio of economic activity: retail, professional service and industrial jobs. Goals 1. Develop and maintain a strong, diversified and sustainable local economy. 2. Make Tigard a center and incubator for innovative businesses including those that focus on environmental sustainability. 3. Make Tigard a prosperous and desirable place to live and do business. Community Economic Development Objectives Community Economic Development Objectives were developed through interviews with City staff and a review of Tigard's economic development vision, goals and recommended action measures. These objectives were refined based on comments from the Planning Commission and the results of interviews with key stakeholders, including state and regional agencies, the Chamber of Commerce, Tigard Central Business District Association, and local employers and developers. • Encourage businesses that provide family -wage jobs to start-up, expand, or locate in Tigard. • Develop industry clusters, and preserve jobs, through the retention, expansion, and recruitment of industries that already have a presence in Tigard. • Promote well - designed and efficient development and redevelopment of vacant and underutilized industrial and commercial lands. • Ensure the City's land use and other regulatory practices are flexible and adaptive and that adequate public facilities and infrastructure exist to support a diverse and stable economic base. • Focus significant employment growth in Tigard's designated centers and corridors and support the development of efficient regional multi -modal transportation systems. • Limit the development of retail and service uses in Tigard's designated industrial areas to preserve the potential of these lands for industrial jobs. Support neighborhood commercial uses to meet smart growth goals. • Encourage businesses that are environmentally and economically sustainable. ECONOMIC TRENDS ANALYSIS The consultant team conducted an economic overview for the City of Tigard, including a review of national, state, regional, county, and local economic trend data and real estate market analysis of office, commercial retail, industrial, and public government space development for the Tigard Urban Service Boundary. The analysis focuses on the expected level of demand for new commercial, industrial, and public development and related gross buildable land needs over the next 20 years (2011- 2031). Both the U.S. and Oregon economies are currently mired in the aftermath of a national economic recession that began in December 2007. The current economic slowdown is now the longest on record since the Great Depression; however, some economic expansion is beginning to occur. According to the U.S. Bureau of Economic Analysis, real Gross Domestic Product (GDP is the measure of value of all goods and services in the U.S.) increased at an annual rate of 3.7 percent during the first quarter of 2010, and increased by 2.4 percent during the second quarter of 2010. Tigard 201 I I?conoiuk Opportunities Anal }sis 2 Consumers are still very cautious as unemployment rates remain high and high levels of home foreclosures continue. Oregon posted a year- over -year overall job loss of 16,000 jobs between June 2009 and June 2010. At the same time, the state's unemployment rate decreased to 10.5 percent in June 2010, compared to 11.6 percent in June 2009. It should be noted that Oregon's employment levels have declined over the past year in spite of the drop in unemployment rate. This trend likely reflects a decline in the number of people who are actively seeking employment. The U.S. and Oregon economies are now poised for a slow economic recovery. The July 2010 survey of the National Association of Business Economists reported expectations of slow growth in GDP during the second half of 2010 in the U.S. as industry demand, profit margins, employment, capital spending and credit conditions improve. Despite job losses, population levels continue to increase in both Oregon and Tigard due to population migration patterns, increases in immigrant population levels and natural population increases. As indicated in Table 1, according to the Portland State University Population Research Center, the population in Tigard increased to 47,460 residents in 2009, up from 42,260 residents in 2000. The average annual growth rate (AAGR) for population in Tigard was 1.3% between 2000 and 2009, which was below the level of population growth recorded for Washington County, but above the Oregon and national growth rates. Table 1. Population Trends, 2000 to 2009 Annual 2000 2009 Change 2000 -2009 Tigard 42,260 47,460 1.3% Washington County 449,250 527,140 1.8% Oregon 3,421,399 3,823,465 1.2% USA 282,171,957 307,006,550 0.9% Source: Portland State University, Population Research Center. Metro (the regional government) has prepared forecasts for households and employment for all local jurisdictions in the Metro Urban Growth Planning Area. The most recently adopted Metro growth forecasts are referred to as the Metroscope Generation 2.3 model, and include a forecast period from 2005 to 2030. FCS GROUP extrapolated the Metro forecasts to year 2035 using Metro's forecasted growth rate from the 2005 -2030. While Metro is currently in the process of preparing updated growth forecasts for the region, the Metroscope Generation 2.3 forecasts are being used for this EOA since they are the only set of officially adopted forecasts at this time. As indicated in Table 2, the 2005 to 2035 forecasts anticipate that Tigard will add approximately 3,185 households and 24,167 jobs over the 25 -year period. The extrapolated 2035 Metro job forecasts shown in Table 2 are provided for informational purpose only. In light of the recent national economic recession that caused severe declines in Oregon employment (from 2007 through 2010 ), Metro's 2030 job forecast for Tigard is assumed to be achieved by year 2035 under the "medium forecast" scenario used in the Tigard EOA. As noted in Table 2, the Metro job growth forecasts reflect the fact that Tigard currently is relatively "jobs rich" with a positive ratio of 2.3 jobs per household, which is well above the tri- county Metro regional average of 1.5 jobs per household. This is no surprise given Tigard's concentration of regional employment centers, including Washington Square Mall, the "Tigard Triangle" employment area near the confluence of I -5 /1-Iwy. 217, and pockets of industrial uses along the Hwy. 217 corridor. Tigard 201 1 Economic Opportunities Analysis 3 Table 2. Metro Growth Forecasts for Households and Employment, 2005 to 2035 Households Projected Projected. Avg. Change Annual Change 2005 2030 2035 2005 -2035 (%) Tigard 17,724 20,341 20,909 3,185 0.6% Clackamas County 140,415 241,821 269,594 129,179 2.2% Multnomah County 288,926 372,913 392,439 103,513 1.0% Washington County 189,925 272,998 293,545 103,620 1.5% Total 3 County Region 619,266 887,732 955,578 336 1.5% Employment* Projected. Avg. Annual 2005 2030 2035 Change Change (%) 2005 -2035 Tigard 41,308 60,637 65,475 24,167 1.5% Clackamas County 145,581 251,286 280,273 134,692 2.2% Multnomah County 493,671 705,721 758,005 264,334 1.4% Washington County 269,660 450,970 499,820 230,160 2.1% Total 3 County Region 908,912 1,407,977 1,538,098 629 1.8% Projected. Projected Tigard Jobs Per Household Ratio Tigard Capture of Capture of 2005 2030 2035 Region HHs Region Jobs Tigard 2.3 3.0 3.1 0.9% 3.8% Clackamas County 1.0 1.0 1.0 N/A N/A Multnomah County 1.7 1.9 1.9 N/A N/A Washington County 1.4 1.7 1.7 N/A N/A Total 3 County Region 1.5 1.6 1.6 N/A N/A Source: Metro adopted housing and employment growth forecasts, 2007; Metroscope Gen. 2.3; extrapolated to 2035 by FCS GROUP. *The extrapolated 2035 Metro job forecasts shown in Table 2 are provided for informational purpose only. In light of the recent national economic recession that caused severe declines in Oregon employment (from 2007 through 2010 ), Metro's 2030 job forecast for Tigard is assumed to be achieved by year 2035 under the "medium forecast" scenario used in the Tigard EOA. Washington Square Mall already functions as a regional commercial center that draws shoppers and patrons from over a 30 -mile radius. With 1,458,734 square feet (sf) of retail and entertainment space, the mall has five anchor stores including JC Penny, Macy's, Nordstrom, Sears, and Dick's Sporting Goods and 170 specialty stores. The mall added 28 new stores and restaurants in 2005, along with a new multi -level parking structure. In addition to large retail employers, Tigard is also home to several large high -tech manufacturing, construction contractors, professional, business operations and state and local government operations. Table 3 provides a list of Tigard employers with more than 250 jobs per establishment. Tigard 2011 economic Opportunities Analysis 4 Table 3. Large Employers in Tigard with More Than 250 Employees, 2008 Firm Name Specialty Employment Range Retail /Gen. Nordstrom Merchandise 500 - 999 Tigard - Tualatin School District Local Government 500 - 999 AEROTEK, Inc. Temp. Emp. Agency 250 - 499 City of Tigard Local Government 250 - 499 COSTCO Corp. Retail. Merchandise 250 - 499 Health Insurance Health Net Health Plan of Oregon Carrier 250 - 499 JC Penny Retail Merchandise 250 - 499 MACYS Retail Merchandise 250 - 499 Performance Contracting, Inc. Industrial Contractors 250 - 499 PERS Headquarters Pension Fund Mgmt. 250 - 499 Remedy Intelligent Staffing, Inc. Temp. Emp. Agency 250 - 499 Aero. & Tech. Part 250 - 499 Rockwell Collins Aerospace Mfg. STARPLEX Corp. Temp. Emp. Agency 250 - 499 Bldg. Interior Western Patricians, Inc. Contractors 250 - 499 Source: Oregon Employment Department. According to regional commercial and industrial real estate brokers, Tigard is a well - defined submarket within the suburban Metro region. Tigard's office market is especially competitive within the inner southwest portion of the region, with businesses considering locations among several areas including Tigard; 217 Corridor /Beaverton; Kruse Way; Barbur Blvd /Capitol Hwy; Tualatin and Wilsonville. Recent office leasing market statistics indicate that office vacancy rates in the Metro region have been increasing since 2008 as many businesses have shed jobs and scaled back on required space needs. As indicated in Appendix A, negative absorption levels have been occurring during the first six months of the year, particularly in Class A Office space, where Tigard experienced a net loss of 13,097 sf during the first half of this year. As of July 1, 2010 Tigard had total Class A vacancy rates of 151,900 sf and another 66,000 sf in vacant Class B and C space. Tigard's Class B inventory has experienced positive absorption this year, with 12,800 sf of net absorption. Since July 2010, Tigard has recorded several positive lease transactions, which rank among the largest in the region, such as Bridgewell Resources (32,088 gsf); Comsys into the Lincoln Center; State Farm Mutual Insurance (23,712 gsf) into Fanno Creek Place; and CAN Insurance (17,843 gsf) into the Pacific Parkway Center. Industrial leasing activity and vacancy rates were also significantly impacted by the recent economic recession. As indicated in Appendix B, Tigard had approximately 170,000 sf of vacant flex space (13.4% vacancy rate), and 339,000 sf of vacant warehouse space (7.7% vacancy rate) as of July 1, 2010. 1 igard 201 1 Economic ()pporainitie. Anal■,i, 5 Overall industrial lease rates in the Tigard submarket averaged $7.68 per sf /year, and were among the highest in the Metro suburbs. The City of Tigard and the Oregon Department of Transportation (ODOT) are taking steps to enhance the Downtown Tigard area to make it a more viable place to live and work. At a cost of $12 million, intersection improvements along Pacific Highway at Hall Blvd. and Greenburg Rd. are being paid for by ODOT, Washington County and the City of Tigard. This project is slated for completion by Spring 2011 and will include a third through -lane on the highway, turn lanes on side streets, an extended median, wider sidewalks, new bike lanes, improved pedestrian crossings, and wider corners for truck turning movements. This effort will also enhance access into and from Downtown Tigard. Tigard's recently completed Downtown Plan is setting the regulatory stage and establishing a new vision for renovating downtown. The vision is intended to be a 50 -year look at how the downtown could change into a "mixed -use urban village" with a wide range of housing and commercial opportunities that optimize natural features, such as Fanno Creek and Fanno Creek Park, transportation facilities, such as Pacific Hwy. and the Westside Express Commuter Rail system, and even light rail or bus rapid transit service to /from Portland. To estimate future development potential for Tigard employment, FCS GROUP evaluated the 10 -year employment growth forecasts prepared by the Oregon Employment Department for the Metro Tri- County region, and Metro growth forecasts for Tigard. As shown in Figure 1, the 10 -year job growth forecasts for the Metro Tri- County Region portend a positive trend towards job growth for all industry sectors, except federal government and the manufacturing sector. The sectors that are expected to grow the fastest in the Tri - County Metro Region include: educational and health services; professional and business services; leisure and hospitality; local government; retail; and wholesale trade. Tiga d 2111 11.cononnic Opportunities Anal∎sis ti Figure 1 Non -Farm Employment, Tri- County Metro Region, 2008 -2018 Forecast Local government 8,040 Stategovernment 1M 1,890 Federal government (270) Other services I= 2,210 Leisure and hospitality 10,590 Educational and health services 23,910 Professional and business services 19,780 Financial activities l= 2,730 Information 800 Transportation, warehousing, and utilities 1,520 Retail trade 6,670 Wholesale trade 4,960 Manufacturing (2,270) Construction • 1,090 Natural resources and mining II 1,190 Source: Oregon Employment Department includes Multnomah, Washington and Clackamas Counties. To estimate future development potential for Tigard, FCS GROUP evaluated the 10 -year employment growth forecasts prepared by the Oregon Employment Department as well as the extrapolated employment growth forecasts from Metro. In light of the recent national economic recession that caused severe declines in Oregon employment (from 2007 through 2010), Metro's 2030 job forecast for Tigard is assumed to be achieved by year 2035 under the "medium forecast" scenario. As indicated in Appendix C, the 20 -year job growth forecasts for Tigard indicate a more positive trend towards job growth for all industry sectors. According to Metro (and FCS GROUP interpretation of Metro data), the general sectors that are expected to grow the fastest in Tigard over the next 20 years include: services ( +10,092 jobs); retail ( +3,810 jobs), industrial /other ( +1,324 jobs), and government ( +882 jobs). The job growth projections indicate that Tigard should expect to experience significant redevelopment opportunities over the next 20- years. A range in employment forecasts is provided to take into account current weak market conditions and national economic expectations that expect lower -rates of job growth over the next several years. As indicated in Table 4, there is a great level of uncertainty Ti 2(11 I Economic Opportunities 7 regarding potential job growth for Tigard in light of weak regional and national employment growth predictions. Table 4. Forecasted 20 -Year Employment Growth and Building Space Needs in Tigard Employment Growth Forecast Slow Moderate High Retail Trades 2,286 3,048 3,810 Services 6,055 8,073 10,092 Industrial /Other* 794 1,059 1,324 Government* 529 706 882 Total 9,665 12,886 16,108 Notes: See supporting analysis in Appendix C. *Metro employment growth forecasts for "Other" were allocated to 60% industrial /other and 40% government by FCS GROUP based on local observations and assumptions. Tigard is expected to add between 9,665 and 16,108 new jobs over the next 20 years. As indicated in Table 5, this amount of employment growth translates into approximately 4.2 to 7.1 million of new or renovated building square footage (floor area). Table 5. Forecasted 20 -Year Total Building Space Needs in Tigard for Employment Employment Type Slow Moderate High Office 1,499,000 1,998,000 2,497,000 Institutional 170,000 227,000 285,000 Flex /Business Park 451,000 602,000 752,000 General Industrial 257,000 342,000 428,000 Warehouse 374,000 499,000 624,000 Retail 1,498,000 1,997,000 2,497,000 Total 4,249,000 5,665,000 7,083,000 Notes: See supporting analysis in Appendix C. Source: FCS GROUP. A large portion of this demand will need to be met by redevelopment and utilization of vacant buildings since large vacant undeveloped tracts of land are becoming increasingly scarce. It is estimated that redevelopment and utilization of vacant buildings is expected to accommodate 70% of the retail space demand, 50% of the service /office demand, 40% of the industrial demand, and 40% of the government facilities demand. Table 6 shows the expected level of redevelopment and refill in the Tigard USB over the next 20 years. As the existing vacant land supply in Tigard gets developed, the level of redevelopment activity is expected to rise. Prime redevelopment locations in Tigard include Downtown and the Tigard Triangle, and future planned high capacity transit stations along Pacific Hwy. The City's Downtown Plan envisions 2,500 dwelling units and over one million square feet of commercial office and retail space being added over the next few decades. Tigard 201 I Economic Opportunities Anal 8 Table 6. Redevelopment and Refill Assumptions (2011 to 2031) Tigard USB Employment Type Slow Moderate High Office 1,004,000 1,339,000 1,673,000 Institutional 114,000 152,000 191,000 Flex /Business Park 203,000 271,000 338,000 General Industrial 116,000 154,000 193,000 Warehouse 168,000 225,000 281,000 Retail 899,000 1,198,000 1,498,000 Total 2,504,000 3,339,000 4,174,000 Source: FCS GROUP; derived from Appendix C, based primarily on Metro 2009 -2035 Urban Growth Report (December 2009 draft) and local assumptions. After accounting for the levels of redevelopment activity identified in Table 6, the amount of vacant land demand in Tigard for employment uses over the next 20 -years is expected to range from 126 to 210 acres. Preliminary estimates for vacant lands needs in Tigard by general building type are provided in Table 7, and supporting assumptions are reflected in Appendix D and Appendix E. Table 7. Vacant Land Needs by General Land Use Zoning Classification (2011 to 2031) Tigard USB (gross buildable acres) Land Use Zoning Classification Slow Moderate High Commercial 51 68 85 Mixed Use 27 36 45 Industrial 48 64 80 Total 126 168 210 Source: FCS GROUP; derived from Appendix C, based primarily on Metro 2009- 2035 Urban Growth Report (December 2009 draft) and local assumptions. To help validate these assumptions, FCS GROUP conducted an additional analysis of retail sales inflow /outflow within Tigard. The retail analysis provided in Appendix D indicates that the amount of local retail trade in Tigard over the next 20 years could support an additional 1.4 million square feet of redevelopment or new development activity, even if current levels of retail sales inflow were cut by 50 %. Hence, it appears that the "slow" or "land efficient" vacant land demand scenario is the best match with respect to the retail market potential for the Tigard USB. The actual amount and timing of new development will vary from year to year. The wide range in development forecasts reflects current uncertainty regarding the region's ability to retain and attract major employers, the City's desire to stimulate redevelopment in downtown, and limited ability to accommodate new commercial and industrial development on vacant lands. 1 iaard 2011 Economic Opportunities Analysis 9 Business Clusters Analysis It is a widely accepted theory among economic development professionals that "business clusters" are the primary force driving local economic currents and business location decisions. Clusters of business activity go well beyond mere concentrations of industry or employment types. They represent unique competitive market advantages with regard to employment, work force, creativity, entrepreneurship, business costs, and supporting natural resources. The dusters analysis prepared by FCS Group is intended to identify potential employment sectors that are most compatible with local economic policy objectives. The process entailed: 1. Obtaining Employment Security (ES202) wage and salary employment data from the Oregon Employment Department (OED) for the Tigard Urban Service Boundary (USB), Washington County, Multnomah County and Clackamas County (tri-county region) for the year 2008. 2. Conducting a location - quotient (LQ) analysis to evaluate business and industrial clusters in the Tigard UGB relative to the tri-county region. 3. Evaluating business clusters within the Tigard UGB with regard to the LQ, projected growth rates, economic size of each cluster, and average wage rates. 4. Classifying each business cluster with regard to one of four classifications, including: I. STARS: Businesses with large LQ (propensity to locate in the Tigard USB) and higher than average projected growth rate compared to the tri -county region. II. EMERGING: Businesses with small LQ and high average growth rate (possible pent up demand or competitive market disadvantage relative to other locations). III. MATURE: Businesses with large LQ but lower than average growth rate. IV. CHALLENGED: Businesses with small LQ and lower than average growth rate. The business cluster analysis summarized in Figure 2 identifies the business sectors within the Tigard USB by their LQ, size and growth potential. Each sector has been analyzed by their North American Industrial Classification System (NAICS) code. This code is used by the federal government to classify types of businesses for tax accounting and economic research purposes. The data was derived from the OED ES202 wage and salary employment statistics for the year ending in 2008. Tigard 20 1 I Economic Opportunities Anal) sic 10 Figure 2 Existing Business Clusters in Tigard USB, 2008 r% Emerging: (High Growth/ Stars 26% Small Cluster) (High Growth) yrof. 3 Tech. Large Cluster) Services 23% 21% 111% - Educational Services 17% Prof. Admin. Was mt. 16% • Ettartalnment Food E Drinking 13% 8 Pls YYh le Trade 11% . . 9x 011111bvernment Average 10 -year Miscrvkss - alai/ Trade Job Growth = 10% ix E . nformation 6% O 0 - a Lodging Art i 3% uj Warehousing Mantis, Activities ioods ... — -1% d.- _ - _._ -_.. _. -_. - Compugr Mfp. . NoMunhN Metals Mfg. - I -11% -13% Transport Equip. -16% hallenged: 4 Mfs- I Mature: ( LOw Gro ' (Low Growth) .17% Small Cluster) r - -- Large Cluster) Note: X -axis denotes the Location Quotient (LQ) average set at 1. All sectors to right of the yellow line have an LQ greater than 1; all sectors to the left of the yellow line have an LQ less than 1. Source: Oregon Employment Department; data compiled by FCS GROUP. The clusters analysis classifies the existing business sectors in the Tigard USB into four general categories: Industry Sectors with Large LQ /High Growth Potential ( "Stars ") • Educational Services (private or non - profit) • Professional and Technical Services • Professional Administration and Waste Management Services • Wholesale Trade Il_ard 2011 Economic Opportunitie A[1,11v • 11 Industry Sectors with Small LQ /High Growth Potential ( "Emerging ") • Health Care and Social Services • Food Service and Drinking Places • Arts, Entertainment and Recreation Industry Sectors with Large LQ /Low Growth Potential ( "Mature ") • Retail Trade • Information Services • Financial Activities and Services • Construction • Nondurable Goods Manufacturing Industry Sectors with Small LQ /Low Growth Potential ( "Challenged ") • Transportation, and Warehousing • Miscellaneous Services • Metals Manufacturing • Computer Parts and Equipment Manufacturing • Lodging • Transportation Equipment Manufacturing • Government In addition to evaluating existing local business clusters, the City may also consider the expected regional growth in business sectors and emerging clusters. According to the Oregon Employment Department, the job sectors with the highest potential for new growth in the greater Portland metropolitan region include: • Business administration and waste management • Finance and insurance • Health care • Hotel /motel accommodations and food services • Professional • Retail trade • Scientific and technical service (computer science, engineering) • State and local government • Transportation and utilities (warehousing, distribution and energy research, private utilities) • Wholesale trade' While manufacturing of durable goods does not make the list of the top growth sectors, there are certain subsectors within manufacturing that are growing faster than others. The manufacturing sectors with the greatest net new job growth potential in the greater Portland metropolitan region include: computer - related parts manufacturing, transportation equipment, other miscellaneous durable goods (such as solar panels), and miscellaneous non - durable goods (such as apparel research and design). 1 These emerging business clusters are documented in the Regional Wired Workforce Innovation and Regional Economic Development, Global Development Strategy, prepared by FCS GROUP et al, 2008. Tigard 20 1 I Economic Opportunities Analysis 1 The greater Portland metropolitan region is now considered an epicenter within the United States for sustainable technology. According to Global Insight, the greater Portland metropolitan region employs 6,700 people in "green jobs" which is more than Denver, Austin, Seattle and San Jose. The number of workers in green jobs (such as solar panel manufacturing, wind energy, bio energy research and manufacturing) is expected to increase to 53,000 over the next two decades. Portland General Electric and Pacific Power are ranked in the top three among the nation's top utility companies for Green Energy sales, and the greater Portland region has more J.F.ED- certified buildings than any other U.S. metropolitan area. With the Portland metropolitan region, recent federal and state tax policies have helped spur major investments in green technology and energy by firms such as: SolarWorld, SunEdison, Vestas and Portland General Electric — creating a major new industrial cluster in clean technology. Additional investments in advanced manufacturing are being made by Intel, Flir Systems (producer of night vision and thermal imaging systems), Precision Castparts (maker of parts used in Vestas wind turbines, Boeing aircraft and other products), Genentech, and other firms. These are examples of manufacturing companies that are finding success within the greater Portland metropolitan region, even in challenging economic times. Focused marketing and business recruitment efforts are being made by the State of Oregon and regional economic development stakeholders to attract certain established and emerging business clusters. The business and industry clusters that are currently being targeted by the Oregon Business Development Department, Portland Business Alliance and the Portland Development Commission include advanced manufacturing, clean technology (with sustainability sub - clusters in green building, solar & wind power), active wear /outdoor gear, and software. Targeted Business Clusters According to its Community Economic Development Objectives, the City of Tigard may target businesses that generally offer above average wages and provide health care and retirement benefits that support families. According to the U.S. Bureau of Labor Statistics, the occupations that had the fastest growth and highest pay over the past 10 years nationally included: computer systems analysts, registered nurses, computer support specialists, teachers, social workers, college faculty, computer programmers, engineering sciences, police officers, securities and financial services, physicians, advertising, marketing, management analysts, electrical engineers, paralegals, writers /editors, commercial artists, medical and health service managers. It is interesting to note that almost two- thirds of the jobs filled in these fast growing occupations required some level of on- the -job training in addition to high school and a college degree? In light of these findings, the consultant team and City staff recommend that Tigard focus on retaining and attracting a mix of existing and emerging business clusters that pay above average wages. This includes existing, established clusters, such as durable goods manufacturing (includes metals and machinery), education (private and non - profits), financial services, information (including software development), professional and technical services, and wholesale trade. They also recommend that the City focus on emerging clusters, including health care and advanced technology (i.e., green energy) manufacturing and research operations. As indicated in Table 8, these recommended business clusters (with the exception of educational services) pay above average wage rates. 2 Based on findings contained in publications provided by JIST Works, including the Occupational Outlook Handbook, 2008 -2009; and America's Fastest Growing Jobs by Michael Farr. 1 i 201 I (ihp Iiunitir, \t1,11) ,I, Table 8. Summary of Existing Businesses in Tigard USB, 2008 Number Average Average of Entities Employment Annual Pay Total Private 2,914 41,032 $43,542 Natural resources and mining 6 21 $38,742 Construction 272 3,329 $56,080 Manufacturing 117 2,743 $54,300 Durable goods 53 1,814 $58,229 Metals and machinery manufacturing 36 897 $51,425 Computer and electronic product mfg. 15 774 $65,308 Transportation equipment manufacturing 2 143 $62,594 Nondurable goods 64 929 $46,628 Trade, transportation, and utilities 704 11,375 $36,742 Wholesale trade 333 2,987 $64,284 Retail trade 329 7,621 $25,407 Transportation, warehousing, and utilities 42 767 $42,114 Information 69 1,206 $66,469 Financial services 405 5,037 $58,459 Professional and business services 638 8,146 $45,971 Professional and technical services 449 3,858 $62,851 Administrative and waste services 189 4,288 $30,784 Educational and health services 269 5,037 $38,133 Educational services 55 2,912 $36,384 Health care and social assistance 214 2,125 $40,531 Leisure and hospitality 204 3,018 $16,579 Arts, entertainment, and recreation 23 184 $16,241 Accommodations and food services 181 2,834 $16,601 Accommodations 10 131 $20,072 Food services and drinking places 171 2,703 $16,433 Other services 230 1,120 $36,618 Government 5 390 $49,275 Total 2,919 41,422 $43,596 Notes: Shading indicates targeted business cluster. Source: Oregon Employment Department, 2008. Average payroll reflects Washington and Multnomah counties. SITE SUITABILITY ANALYSIS (LAND DEMAND) The majority of the targeted businesses that consider expanding or relocating into Tigard will consist of small business operations (less than 50 employees) that can locate within existing professional office or Tigard 2011 Economic Opportunities Analysis 14 industrial buildings, or within new office or flex /industrial buildings that are developed on vacant sites of less than five acres in size. It is also likely that there will be larger potential business and high -tech industrial operations that consider Tigard as a potential location for new campus -style developments. Certain opportunities may emerge as regional businesses expand and desire to remain within the tri-county region. Other opportunities may occur as global and national businesses desire to establish a presence in the Pacific Northwest. In any event, it is likely that Tigard could attract three to four large professional service, health care, education, and /or high tech industrial businesses over the next 20 years. As indicated in Table 9, Tigard is already home to 41 large private business operations (with between 70 -250 employees). Tigard could continue to retain and attract large businesses if adequate sites are available. These types of large private operations usually require surplus adjacent land areas to accommodate future business expansion. Table 9. Existing Private Businesses by Size Class, Tigard USB, 2008 Total Large Small /Medium Sector Establishments Establishments Establishments Number Jobs Number Jobs Number Jobs Natural resources and mining 6 21 -- -- 6 21 Construction 272 3,329 4 571 268 2,758 Manufacturing 117 2,743 10 1,300 107 1,443 Durable goods 53 1,814 10 1,300 43 514 Nondurable goods 64 929 -- -- 64 929 Trade, transport., utilities & 704 11,375 20 3,997 684 7,378 communications y _ Y Wholesale trade 333 2,987 1 125 332 2,862 Retail trade 329 7,621 16 3,517 313 4,104 Transport., warehousing and 42 767 3 355 39 412 communications Information 69 1,206 2 376 67 830 Financial, professional & tech. 1,043 13,183 4 1,426 1,039 11,757 services Educational and health services 269 5,037 -- -- 269 5,037 Educational services 55 2,912 -- -- 55 2,912 Health care and social 214 2,125 214 2,125 assistance Leisure and hospitality 204 3,018 -- -- 204 3,018 Arts, entertainment, and 23 184 -- -- 23 184 recreation Accommodations and food 181 2,834 - 181 2,834 services Other services 230 1,120 1 99 229 1,021 Total 2,914 41,032 41 7,769 2,873 33,263 Notes: green shading indicates targeted business cluster. Source: Wagon Employment Department, 2008. Note: large establishments an those with at least 70 employees. Tigard 2011 Economic Opportunities Analysis y. The consultant /staff team recommends that Tigard provide a variety of small, medium and large vacant sites that meet the targeted business and industrial requirements. As indicated in Table 10, the existing businesses within Tigard can generally be grouped into three general land use categories: industrial, commercial and office. Table 10. Existing Private Businesses by Size Class and General Land Use or Building Type, Tigard USB, 2008 Small /Medium Primary Land Total Entities Large Entities Entities Use /Building Type Firms Jobs Firms Jobs Firms Jobs Industrial 1 770 9,847 18 2,351 752 7,496 Commercial 2 763 11,759 17 3,616 746 8,143 Office 3 1,381 19,426 6 1,802 1,375 17,624 Total 2,914 41,032 41 7,769 2,873 33,263 Notes: ' Reflects natural resources, construction, manufacturing, wholesale trade, transportation, warehousing, utilities, and communications sectors. 2 Reflects retail trades, lodging, accommodations, and misc. service sectors. 3 Reflects information, financial, professional and technical service, health care and educational service sectors. 4 Large establishments reflect establishments with at least 70 employees. Source: Oregon Employment Department, 2008. Compiled by FCS GROUP. Most small and medium business establishments prefer to lease space in office or commercial buildings, and /or could locate into redevelopment sites in downtown or in selected redevelopment locations (e.g., near planned high capacity transit stations or within the Tigard Triangle). No special vacant land requirements are identified for future small or medium businesses. However, the City should pursue more proactive redevelopment strategies to accommodate small and medium sized businesses. Larger business establishments that are included within the targeted business clusters will likely have minimum site size and infrastructure service requirements. Typical site requirements for the larger targeted business sectors are described in Table 11 and described in more detail in Appendix F. Based on the site requirements described in Table 11 and Appendix F, the recommended targeted business clusters will need sites ranging from one to twenty-five acres, with a majority of the need falling in the five to ten -acre range. Tigard 20I I Economic nomic Opportunities An_+I∎ <i; 16 Table 11. Typical Site Size Requirements for Tars, eted Business Types Small Users Medium Users Large Users Less than 50 jobs 50 to 70 jobs 70 to 200+ jobs per business per business per business Industrial Building tenants or 4 to 6 acres per user 6 to 20 acres per • Advanced Technology infill user Manufacturing redevelopment Prefers industrial or • Metals /Machinery Prefers industrial or sites in established business park Manufacturing business park industrial locations settings • Wholesale Trade campus settings Office Building tenants or 2 to 4 acres per • Education infill 1 to 2 acres per user user* • Professional and redevelopment Technology. Services sites in town Prefers town center, Prefers business • Information center, regional corridors or transit park campus • Financial Services center, or transit station areas setting with transit • Health Care* station areas service Retail Not in Targeted Clusters Notes: Assumes site development requirements shown in Appendix F. *Larger medical facility campus could require 15 to 30 acres. INVENTORY OF SUITABLE SITES (LAND SUPPLY) Consistent with the employment land demand forecast, the buildable land inventory (BLI) for the Tigard EOA documents industrial and commercial inventory that currently exists within the Tigard Urban Planning Area (UPA). This analysis documents existing land use inventories and compares industrial and commercial land use needs required for addressing the slow, moderate and high growth forecast scenarios. Employment Land Inventory The Tigard EOA includes a recent buildable land inventory completed by the City of Tigard Planning staff using Geographic Information Systems (GIS) data that is consistent with the current Draft 2009- 2035 Urban Growth Report (accepted by Metro Council in December 2009). The City's BLI included an analysis of existing vacant and partially vacant (sub - dividable) tax lots by current zoning classification and deducted all significant environmental constraints to estimate buildable land area within the Tigard USB. The land supply analysis focused on the land use classifications that support employment uses, including commercial, mixed -use, and industrial zones. The City has 10 commercial zones to account for a wide variety of uses ranging from retail to medical centers to mixed use centers. Tigard has three zones which accommodate industrial uses. Please refer to Appendix E for a detailed description of the allowed, conditional, and permitted uses within each of the City's zone classifications. The buildable land area for each tax lot was derived by analyzing GIS data pertaining to environmental features that would constrain the amount of potential site development on vacant and partially vacant areas. For purposes of this analysis, the environmental constraints were calculated for each site using Tigard 2011 kconomic Opportunities Analysis I estimates for land area that is constrained by the following: Metro Title 3 designation (waterways, wetlands, riparian buffers, 100 year floodplain). The vacant and partially vacant land inventory for the Tigard UPA includes 125 tax lots with a total buildable land area of 136.1 acres, as indicated in Table 12. Tigard's vacant land supply primarily consists of small (less than one acre) tax lots and tax lots between one and five acres in size. As indicated in Table 12, the tax lots of less than five acres in size comprise 79.3 acres or nearly sixty percent of the total vacant land supply. The larger tax lots include three lots of five to ten acres (22.1 acres total), and two contiguous tax lots more than ten acres in size (34.7 acres total). Please refer to Appendix G for additional detail. Table 12. Distribution of Vacant and Part Vacant Lands by General Land Use Zone Classification, Tigard USB Vacant and Partially Vacant Property < 1 acre 1 to 5 acres 5 to 10 acres > 10 acres Total Lots Acres Lots Acres Lots Acres Lots Acres Lots Acres Commercial 26 9.5 8 20.2 2 16.4 0 0 36 46.1 Mixed Use 63 25.3 6 8.9 1 5.7 0 0.0 70 39.9 Industrial 12 4.2 5 11.2 0 0.0 2 34.7 19 50.1 Total 101 39.0 19 40.3 3 22.1 2 34.7 125 136.1 Source: City of Tigard. As mentioned in the Site Suitability Analysis, the recommended targeted business dusters will need sites ranging from one to twenty-five acres to expand or locate within the Tigard UPA, with a majority of the need falling in the five to ten -acre range. The City appears to have a range of sites available to accommodate the targeted business clusters. However redevelopment sites may be needed to accommodate development needing five to ten -acre parcels. In light of the importance of redevelopment to the City's ability to grow and diversify its economic base, the City and consultant team also evaluated the relative level of high, medium and low redevelopment potential for each developed tax lot in the Tigard UPA. While this is not a stated requirement within OAR 660, Division 9, it is considered an important factor in deciding which land use growth scenario to target. The analysis of redevelopment opportunities is based on the ratio of assessed improvement value to land value for each tax lot using 2010 Washington County Assessor data. The results provided in Table 13 indicate that there are significant amounts of high and moderate redevelopment potential within the Tigard USB. The redevelopment analysis identifies 169 tax lots with a total of 115.6 acres as having "high" redevelopment potential, and 180 tax lots with 166.6 acres as having "moderate" redevelopment potential. h ,. Tigard 2011 Economic Opportunities Analysis 18 Table 13. Analysis of Redevelopment Tax Lots by General Land Use Zone Classification, Tigard USB City of Tigard Redevelopable Potential (Improvement to Land Value)* High (< 0.33) Moderate Low (> 1.00) (0.33 to 1.00) Lots Acres Lots Acres Lots Acres Commercial 19 7.2 31 17.8 199 299.8 Mixed Use 132 81.4 124 89.9 232 344.3 Industrial 18 27.0 25 58.8 146 437.9 Total 169 115.6 180 166.6 577 1,082.0 Notes: Improvement to Land Value calculated from Washington County Tax Assessor data (Sept 2010). 2 196 Properties contained a zero Improvement or Land Value and are not represented here. Source: City of Tigard. Short -Term Land Supply Determination In addition to the long -term land supply, OAR 660 - 009 -0005 also requires the identification of a short - term supply of land meaning "suitable land that is ready for construction within one year of an application of a building permit or request for a service extension." OAR 660 - 009 -0025 also requires that cities must provide "at least 25 percent of the total land supply within the urban growth boundary designated for industrial and other employment uses as short -term supply." In Tigard's case, all of the land supply currently included within the Tigard UPA is deemed by the City to be within the short -term supply category. Hence, there are existing roads, water, sewer, and other infrastructure facilities that are sized appropriately to handle some level of new development on the remaining vacant tax lots. One issue the City has been dealing with is that of highway capacity. This will continue to be an issue until a regional solution is found. This constraint was the cause of a maximum floor -to -area ratio of 0.4 being applied to the Tigard Triangle when a portion of it was rezoned to mixed -use employment. This severely limits the ability to maximize the development potential of available sites. It also causes proposed developments to provide mitigating measures when it is determined the increased vehicle trips will not meet ODOT performance measures. This can be financially constraining to a project if additional lanes, medians, or intersection improvements are required to be paid for by the development. Additionally, the Transportation Planning Rule (OAR 660 -12 -0600) and related ODOT performance standards for the state highways have presented a barrier to Tigard achieving its aspirations. This includes amending existing zoning to allow higher density developments that are consistent with the Region 2040 land use designations. The TPR requires an amendment to an adopted plan not cause an affected roadway to fail to meet performance standards, or if the forecast roadway operations are already failing to meet performance standards, the plan amendment must not further degrade performance. This is a known issue in Downtown, Washington Square Regional Center, along Pacific Highway, and in the Tigard Triangle, and may also arise in other areas near state highways or freeway interchanges. These issues are being addressed at the state and regional levels and could be somewhat mitigated as the City, Metro, and ODOT work to develop alternative performance standards through a corridor Tigard 201 I I conomic Oportunutes 19 refinement plan for Pacific Highway. The Pacific Highway corridor is also being studied for potential high- capacity transit service in the future. The presence of high - capacity transit could also alleviate some of the issues associated with ODOT performance measures by allowing new development to allocate additional trips to transit and reduce automobile trip demand. Strategies to promote transit - oriented development and address ODOT capacity issues are recommended as part of the implementation plan policies for the Tigard EOA. ASSESSMENT OF POTENTIAL (RECONCILIATION OF DEMAND AND SUPPLY) Short -Term Land Need Determination Commercial and industrial properties appear to clearly meet the statutory requirements for short -term land supply, as all of the long -term land supply can be classified as short -term as well as long -term supply. Industrial and commercial properties appear to be well served with adequate infrastructure, and there is an abundant supply of vacant industrial, office and retail building floor area being actively marketed in the Tigard USB today. Long -Term Land Need Determination Consistent with EOA documentation requirements, the economic trends analysis of land needs scenarios and the business clusters analysis indicates that the Tigard UPA can add approximately 794 net new industrial jobs without needing to add additional industrial -zoned land over the next 20 years. In light of current downward trends in industrial business activity, the land efficient need scenario appears to be most consistent with regional growth forecasts and anticipated market realities. Industrial Land Need and Parcel Requirements As indicated in Table 13, the land efficient need scenario assumes 48 acres of net new industrial vacant land demand, which is just below the estimated vacant industrial land supply of 50 acres. If the City opts to pursue a more aggressive economic growth strategy that is consistent with the moderate or high land need scenario, the City would need to identify another 14 to 30 acres of vacant industrial land area to meet the level of industrial demand associated with adding another 1,059 to 1,324 industrial jobs. In light of the City's rather limited remaining vacant industrial land supply of tax lots in excess of five acres, the consultant /staff team recommends that the City adopt economic goals and objectives that preserve the remaining large contiguous industrial sites for large industrial employment users. A preliminary expected forecast of demand by parcel size is also provided in Table 14, and assumes that virtually all of the remaining vacant industrial land supply within the Tigard UPA will be absorbed over the next 20 years. I 4)I I I.conomic Opportunities iAnaIvsis 20 Table 14. 20 -Year Industrial Demand Forecast and Vacant Land Supply, Tigard USB Efficient Land Moderate Land High Land Land Demand and Supply Need Scenario Need Scenario Need Scenario Demand for Vacant Industrial 48 64 80 Land Supply of Vacant Industrial Land 50 50 50 Land Surplus or (Deficit) 2 (14) (30) Existing Forecast of Preliminary Parcel Distribution, Unconstrained Parcel Size Surplus Efficient Land Need Forecast 1 Supply (tax Demand (tax lots) lots) (tax lots) 1 / Less than 1 acre 12 10 2 1 to 5 acres 5 5 0 5 t 10 acres 0 0 0 10 to 20 acres 2 2 0 20+ acres 0 0 0 Total 19 17 2 Notes: Tax lot demand forecast expected to meet or exceed supply in 20 years. Source: Based on findings included in demand and supply analysis. Commercial Land Need and Parcel Requirements As indicated in Table 15, the land efficient needs scenario assumes 78 acres of net new commercial and mixed -use vacant land demand, which is just below the estimated vacant land supply of 86 acres. As with the industrial land needs, an economic growth strategy that is consistent with the moderate or high land needs scenario would require the City to identify an additional 19 to 45 acres of vacant commercial and mixed -use land to meet the demand. . In light of the City's rather limited remaining vacant commercial and mixed -use land supply of lots in excess of five acres, the consultant /staff team recommends that the City adopt economic goals and objectives that preserve the remaining large contiguous commercial sites for strategic commercial retail and office employment users, and allow housing in these areas, only as part of a mixed -use development. A preliminary expected forecast of demand by parcel size is also provided in Table 15, and assumes that virtually all of the remaining vacant commercial land supply over one acre in size within the Tigard UPA will be absorbed over the next 20 years. The City also anticipates the development of high- capacity transit along the Pacific Highway corridor. The region has made a commitment to high- capacity transit and this corridor is the next to be studied. Any development of high- capacity transit would trigger the City to identify station areas to accept higher, transit supportive mixed -use densities. The logical locations for station areas would more than likely result in the rezoning of general commercial lands to mixed -use zoning. As both commercial and mixed -use zoned lands are included in this analysis, any rezoning would not decrease the amount of vacant or partially vacant land available. The range of allowed uses, from retail to multi -story office buildings, would not be affected. t,p ,,,,, An:�I 21 Table 15. Reconciliation of Long -term Land Demand and Supply Commercial and Mixed Use 20 -Year Land Use Forecast (gross buildable acres), Tigard USB Low Land Need Medium High Land Land Demand and Supply Land Need Need Scenario Scenario Scenario Demand for Vacant Commercial 78 105 131 Land Commercial Demand 51 68 85 Mixed - Use Demand 27 36 45 Supply of Vacant Commercial 86 86 86 Land Commercial Zoned Supply 46 46 46 Mixed -Use Zoned Supply 40 40 40 Land Surplus or (Deficit) 8 (19) (45) Preliminary Parcel Distribution, Existing Supply Forecast of Surplus Efficient Need Forecast (tax lots) Demand (tax lots) (tax lots) Less Than 1 acre 89 30 59 1 to 5 acres 14 14 0 5 to l0 acres 3 3 0 l0 to 20 acres 0 0 0 20+ acres 0 0 0 Total 106 47 59 Source: FCS GROUP, based on findings included in demand and supply analysis. Planning, Market, Cost and Risk Factors Consistent with EOA documentation requirements, the economic trends analysis, stakeholder interviews and business clusters analyses indicate that the Tigard USB is uniquely positioned within the greater Portland metropolitan region to experience continued success in retaining and attracting businesses and economic development. Risk of Losing Large Commercial and Industrial Sites As Tigard's vacant land supply of large parcels (more than five acres) becomes diminished, the City could risk losing economic growth potential if remaining larger industrial and commercial sites allow non - employment uses that displace prospective business opportunities. While the current short-term employment market is sluggish at best, the future long -term job growth trends bode well for Tigard if it preserves large commercial and industrial zoned parcels for intended business activity. These risks can be mitigated in part by adopting new economic development objectives that preserve large commercial and industrial areas for desired commercial and industrial business activities. Risk of Not Adequately Preparing for Targeted Area Redevelopment As Tigard's population and employment levels increase with time, and vacant land diminishes, the City will need to rely more upon redevelopment areas, and productivity increases from existing developed lands and businesses to achieve long -term economic strength and diversity. New economic Cigard 2011 Economic Opportunities Analy 22 development objectives should be formulated to enable the City to leverage desired redevelopment in targeted locations such as downtown, and within planned transit- station communities. Risk of Expanding the USB in the Future Beyond the 20 -year forecast time horizon the City should consider the need to grow into urban reserve locations, if the City's investment in infrastructure extensions yields a favorable return to its residents and businesses. An Urban Planning Area expansion is not necessary at this time to accommodate industrial and other employment land needs for the next 20 years, unless the City opts to pursue the moderate or high land needs scenario to accommodate additional commercial and industrial job growth. Planning and Permitting Risks The City should review its land use development code to ensure that it preserves sites for their intended use, yet is flexible enough to accommodate a full diversity of commercial and light industrial uses consistent with public safety, public facilities, and positive urban design characteristics. The ability to provide a streamlined and predictable permitting process can be a challenge as the City relies more on smaller infill and redevelopment sites to accommodate business growth. Non - Local Regulatory Risks The City is dependent upon ODOT to achieve higher trip caps in targeted redevelopment areas. As the City and Metro pursue high capacity transit facilities and assessed service levels, these regulatory risks may be addressed by assuming higher non - vehicle mode shares that result in reduced traffic impacts from new development. Most of the risk factors described above may be addressed by the City of Tigard. Others will require partnerships with regional and state regulatory agencies, such as Metro, Washington County and ODOT. The City can take a leadership position by providing a local planning and permitting environment that is favorable to business investment and more proactive economic marketing to raise awareness of Tigard's strengths as a preferred location for over 2,900 existing business establishments. IMPLEMENTATION POLICIES AND ACTION MEASURES OAR 660 - 009 -0020 stipulates that comprehensive plans must provide community economic development objectives, a commitment to providing a competitive short-term land supply, and identification and provision of adequate sites and public facilities to serve economic development demand. Since the City of Tigard updated the economic development chapter of its Comprehensive Plan in 2008, the document contains a fairly complete set of economic development goals, policies and action measures. The following is a list of topics and recommended policy updates to comply with state statutes and /or implement the City's economic goals. Policies Community Economic Development Objectives (CEDOs) The majority of these objectives are already embedded in existing policies. Two new policies are recommended: `The City shall encourage neighborhood commercial uses that support economic opportunities, multi -modal transportation options, neighborhood vitality, and the goals of efficient land use patterns." Tigard 201 1 Economic opportunities ;Analysis 23 `The City shall encourage businesses that are environmentaly and economically sustainable." Commitment to Provide Adequate Sites and Facilities and Commitment to Provide a Short-Term Land Supply of Land The commitment to provide adequate public facilities is embedded in existing Policy 9.1.4 of the Comprehensive Plan. One new policy is recommended to describe the commitment to provide adequate sites and a short-term land supply: `The City shall monitor and update its Buildable Lands Inventory to ensure adequate short and long -term supplies of buildable employment land." Provide for Prime Industrial Land Development on Large Lots Existing Policy 9.1.7 addresses the need to protect prime industrial land but does not address the need for large lots. It is recommended the policy be revised as follows: "The City shall limit the development of retail and service land uses in Metro - designated industrial areas, and especially on lots of 10 or more acres, to preserve the potential of these lands for industrial jobs." Promote Targeted Redevelopment in Downtown and other areas This issue is addressed by several existing policies and recommended action measures, but most directly by Policy 9.3.1: "The City shall focus a significant portion of future employment growth and high - density housing development in its Metro - designated Town Center (Downtown); Regional Center (Washington Square); High Capacity Transit Corridor (Hwy 99W); and the Tigard Triangle." No new language is proposed. Recommended Action Measures Assist property owners with the Oregon Industrial Site Certification Process A new recommended action measure is suggested: "Assist property owners with the Oregon Industrial Site Certification Process to help preserve and market the City's inventory of industrial lands." Economic Development Marketing and Incentives Directed Towards Strategic Clusters This issue is addressed indirectly by several recommended action measures, but could benefit from more concise language. A new recommended action measure is suggested: `Explore an economic development marketing and incentives program targeting strategic business clusters." Work with ODOT to address mobility standards Capacity issues on state highways (particularly Pacific Highway, Hwy. 217, and Interstate 5) impact economic development opportunities through trip caps, limited floor -to -area ratios, and required road improvements that are expensive. The conversation is just getting started at the regional level. A new recommended action measure is suggested: 'Work with state and regional partners to develop alternative mobility standards that will benefit the community and its economic development efforts. " I isard 21)1 I [conontic (lpportunitic, Anal) SIN 24 Monitor Local and Regional Economic Development Initiatives This request from the Planning Commission led to a suggested new recommended action measure: `Monitor local and regional economic development initiatives to assess their effectiveness related to cost and outcome." Metro Designated Centers and Corridors Based on a resolution passed by the Tigard City Council, Metro recently amended its Growth Concept Map expanding the Tigard Town Center Boundary to include the entire Tigard Urban Renewal District and the Tigard Triangle. The City is required to adopt this change into its Comprehensive Plan. Staff recommends adopting a definition that will refer to the Metro Growth Concept Map, thus eliminating the need to amend the Tigard Comprehensive Plan each time the Metro Growth Concept Map is amended. igard 201 I Economic Opportunities Ana■sis 25 APPENDIX A - OFFICE LEASING ACTIVITY SUMMARY, MID -YEAR REPORT OFFICE Leasing Activity, Mid -Year 2010 (as of June 30, 2010) Class A Market Statistics Mid -Year 2010 Existing Inventory Vacancy YTD Net YTD Under Const Quoted Market #Builds Total RBA Total SF Vac% Absorbtion Deliveries SF Rates Central Business District 41 11,389,435 1,412,066 12.4% (135,590) 368,800 62,200 $24.42 Suburban 141 17,234,745 2,225,626 12.9% (130,126) - - $23.74 Tigard 6 509,087 151,931 29.8% (13,097) - - $23.93 217 Corridor /Beaverton 12 1,142,430 303,750 26.6% (15,550) - - $21.77 Kruse Way 19 1,961,855 495,615 25.3% (26,228) - - $26.05 Barbur Blvd /Capitol Hwy - - - - - - $0.00 Tulalatin 4 361,270 154,503 42.8% 5,604 - - $24.31 Wilsonville 4 325,501 55,071 16.9% - - - $24.77 Total 182 28,624,180 3,637,692 12.7 % (265,716) 1P 368,800 62,200 $24.01 Class B Market Statistics Mid -Year 2010 Existing Inventory Vacancy YTD Net YTD Under Const Quoted Market # Builds Total RBA Total SF Vac% Absorbtion Deliveries SF Rates Central Business District 130 9,423,902 927,523 9.8% 61,787 - - $20.18 Suburban 1,155 30,095,314 4,345,461 14.4% (62,639) 14,000 268,854 $17.82 Tigard 83 1,979,955 277,469 14.0% 12,806 - - $20.88 217 Corridor /Beaverton 72 1,719,571 314,759 18.3% 5,148 - - $16.40 Kruse Way 26 728,262 93,241 12.8% (14,059) - - $20.76 Barbur Blvd /Capitol Hwy 42 890,672 121,398 13.6% 2,337 - - $16.79 Tulalatin 30 704,815 105,798 15.0% (7,289) - - $19.36 Wilsonville 17 622,051 30,169 4.8% (10,369) - - $16.71 Total 1,285 39,519,216 5,272,984 13.3 % (852) P' 14,000 268,854 P $18.38 Class C Market Statistics Mid -Year 2010 Existing Inventory Vacancy YTD Net YTD Under Const Quoted Market # Builds Total RBA Total SF Vac% Absorbtion Deliveries SF Rates Central Business District 177 4,093,913 489,486 12.0% 11,201 - - $17.49 Suburban 2,815 18,283,763 129,081 0.7% 68,665 - - $14.36 Tigard 97 662,182 66,493 10.0% (3,199) - - $15.60 217 Corridor /Beaverton 82 609,431 70,635 11.6% 1,202 - - $14.50 Kruse Way 19 133,044 2,452 1.8% - - - $18.00 Barbur Blvd /Capitol Hwy 120 846,865 99,822 11.8% (5,090) - - $15.60 Tulalatin 20 119,561 29,278 24.5% (5,598) - - $14.73 Wilsonville 21 103,496 2,681 2.6% 5,609 - - $17.21 Total 2,992 22,377,676 618,567 2.8% 79,866 - - _ $14.93 Class B and C Market Statistics Mid -Year 2010 Existing Inventory Vacancy YID Net YTD Under Const Quoted Market #Builds Total RBA Total SF Vac% Absorbtion Deliveries SF Rates Central Business District 307 13,517,815 1,417,009 10.5% 72,988 - - $19.37 Suburban 3,970 48,379,077 4,474,542 9.2% 6,026 14,000 268,854 $16.51 Tigard 180 2,642,137 343,962 13.0% 9,607 - - $19.56 217 Corridor /Beaverton 154 2,329,002 385,394 16.5% 6,350 - - $15.90 Kruse Way 45 861,306 95,693 11.1% (14,059) - - $20.33 Barbur Blvd /Capitol Hwy 162 1,737,537 221,220 12.7% (2,753) - - $16.21 Tulalatin 50 824,376 135,076 16.4% (12,887) - - $18.69 Wilsonville 38 725,547 32,850 4.5% (4,760) - - $16.78 Total 4,277 61,896,892 5,891,551 9.5% 79,014 14,000 _ 268,854 _ $17.14 Quoted Rates for Class B and C table are weighted average of individual B and C markets according to the total RBA inventory Source: CoStar Office Report Mid -Year 2010; Capacity Commercial Group. Tigard 2011 Economic Opportunities Analysis 26 APPENDIX B: INDUSTRIAL LEASING ACTIVITY, MID -YEAR 2010 REPORT Flex Building Market Statistics Mid -Year 2010 Existinglnventory Vacancy YTD Net YTD UnderConst Quoted Market #Builds Total RBA Total SF Vac% Absorbtion Deliveries SF Rates Central Business District 3 45,000 10,000 22.2% - - - $16.50 Suburban 741 18,956,577 2,268,793 12.0% (336,814) 70,020 - $10.23 Tigard 50 1,277,751 170,855 13.4% (12,799) - - $12.30 217 Corridor /Beaverton 87 2,204,502 419,258 19.0% (69,237) - - $11.77 Kruse Way 2 88,928 - 0.0% - - - $0.00 Barbur Blvd/Capitol Hwy 7 53,681 6,771 12.6% 5,100 - - $10.35 Tulalatin 14 430,840 23,229 5.4% (2,531) - - $7.54 Wilsonville 29 1,661,734 201,334 12.1% (18,316) 7,020 - $9.31 Total 744 19,001,577 2,278,793 ► 12.0% (336,814) 70,020 r. - $10.24 Warehouse Building Market Statistics Mid -Year 2010 Existing Inventory Vacancy YTD Net YTD Under Const Quoted Market # Builds Total RBA Total SF Vac % Absorbtion Deliveries SF Rates Central Business District 41 1,616,833 141,090 8.7% (1,843) - - $5.78 Suburban 4,694 167,214,476 13,813,643 8.3% 91,337 119,723 415,000 $5.55 Tigard 119 4,394,617 339,683 7.7% 57,333 - - $6.38 217 Corridor /Beaverton 75 3,332,391 471,805 14.2% 31,770 - - $6.30 Kruse Way 13 301,069 3,378 1.1% 10,240 - - $7.20 Barbur Blvd /Capitol Hwy 17 209,963 5,000 2.4% 8,000 - - $6.16 Tulalatin 221 8,453,141 675,494 8.0% (39,805) - - $5.20 Wilsonville 83 6,155,906 1,268,475 20.6% 47,351 - - $5.95 Total 4,735 168,831,309 13,954,733 ► 8.3% 89,494 119,723 415,000 $5.55 Total Industrial Market Statistics Mid -Year 2010 Existinglnventory Vacancy YTD Net YTD UnderConst Quoted Market # Builds Total RBA Total SF Vac % Absorbtion Deliveries SF Rates Central Business District 44 1,661,833 151,090 9.1% (1,843) - - $7.16 Suburban 5,435 186,171,053 16,082,436 r 8.6% (245,477) 189,743 415,000 $6.19 ► Tigard 169 5,672,368 510,538 9.0% 44,534 - - $7.68 217 Corridor /Beaverton 162 5,536,893 891,063 16.1% (37,467) - - $8.07 ' Kruse Way 15 389,997 3,378 0.9% 10,240 - - $7.20 Barbur Blvd /Capitol Hwy 24 263,644 11,771 ' 4.5% 13,100 - - $8.01 Tulalatin 235 8,883,981 698,723 ► 7.9% (42,336) - - $5.29 Wilsonville 112 7,817,640 1,469,809 ' 18.8% 29,035 7,020 - $6.72 Total 5,479 _ 187,832,886 16,233,526 ► 8.6 %_ (247,320) 189,743 _ 415,000 $6.20 Source: CoStar Office Report Mid -Year 2010; Capacity Commercial Group. I igard 201 I l conomic Opportunities Analysis 27 APPENDIX C: ANALYSIS OF EMPLOYMENT AND SPACE NEEDS Projected Tigard Employment, Medium Forecast Scenario, 2005 -2035 Change 2005 Proj. 2035 Jobs Retail Trades 9,854 14,426 4,572 46% Services 11,372 23,482 12,110 106% Industrial /Other" 12,049 13,637 1,588 13% Government* 8,033 9,092 1,059 13% Total 41,308 60,637 19,329 47% Source: Metro adopted housing and employment growth forecasts, 2007; Metroscope Gen. 2.3. Assumes allocation of "Other " jobs at 60% industrial, and 40% government. In light of the recent national economic recession that caused severe declines in Oregon employment from 2007 through 2010, Metro's 2030 job forecast for Tigard is assumed to be achieved by year 2035 under the "medium forecast" scenario. Projected Tigard Net New Average Annual Employment Forecast (1 Year Forecast) Low Medium High Retail Trades 114 152 191 Services 303 404 505 Industrial /Other* 40 53 66 Government* 26 35 44 Total 483 644 805 Projected Tigard Net New 20 -Year Employment Forecast Low Medium High Retail Trades 2,286 3,048 3,810 Services 6,055 8,073 10,092 Industrial /Other` 794 1,059 1,324 Government* 529 706 882 Total 9,665 12,886 16,108 1. Tigard 2011 Economic Opportunities Analysis 28 , APPENDIX C: ANALYSIS OF EMPLOYMENT AND SPACE NEEDS (CONTINUED) Job Sectors and Building Type Assumptions Flex /Bus. Gen. Employment Sectors Office Institutional Park Industrial Warehouse Retail Total Retail Trades 5% 1% 6% 0% 12% 76% 100% Services 72% 1% 5% 1% 1% 20% 100% Industrial /Other 8% 0% 50% 40% 2% 0% 100% Government 43% 37% 5% 0% 0% 15% 100% Source: Metro Draft 2009 - 2030 Urban Growth Report; modified to reflect local observations. Proj. Tigard Net New 20 -Year Employment Forecast by Building Type, Low Flex /Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Retail Trades 114 23 137 - 274 1,737 2,286 Services 4,360 61 303 61 61 1,211 6.055 Industrial /Other* 64 - 397 318 16 - 794 Government* 228 196 26 - - 79 529 Total I 4,765 I 279 I 863 I 378 I 351 I 3,028 I 9,665 Proj. Tigard Net New 20 -Year Employment Forecast by Building Type, Medium Flex /Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Retail Trades 152 30 183 - 366 2,316 3.048 Services 5,813 81 404 81 81 1,615 8,073 Industrial /Other* 85 - 529 424 21 - 1,059 Gowrnment* 304 261 35 - - 106 706 Total I 6,353 I 372 1,151 I 504 I 468 I 4,037 I 12,886 Proj. Tigard Net New 20 -Year Employment Forecast by Building Type, High Flex /Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Retail Trades 191 38 229 - 457 2,896 3,810 Services 7,266 101 505 101 101 2,018 10,092 Industrial /Other* 106 - 662 529 26 - 1,324 Government* 379 326 44 - - 132 882 Total I 7,942 I 465 1,439 I 630 I 585 I 5,046 I 16,108 Source: FCS GROUP based on Metro Draft 2009 -2030 Urban Growth Report; modified to reflect local observations. • t r• Tigard 2011 Economic Opportunities Analysis 29 F -. APPENDIX C: ANALYSIS OF EMPLOYMENT AND SPACE NEEDS (CONTINUED) Building Type to Land Needs Assumptions* Flex/Bus. Gen. Office Institutional Park Industrial Warehouse Retail Refill/RedeN,elopment Rate ' 67% 67% 45% 45% 45% 60% Jobs Needing Vacant Land Rate 2 33% 33% 55% 55% 55% 40% Building SF Per Job 2 370 630 550 700 1,100 510 Floor-Area-Ratio 0.50 0.50 _ 0.31 0.30 0.30 0.30 Public Facility Net:Gross Adjustment 3 1.10 1.05 _ 1.10 1.05 1.05 1.10 Work at Home Adjustment 4 0.15 0.03 0.05 0.03 0.03 0.03 * assumptions are intended to reflect a long-term average over 20 years. some "ramp up" is expected to attain these density levels. 1/ Adjusts for building refill & vacancy allowances. 2/ Building density derived from Metro UGR assumptions. 3/ Allowances take into account land dedicated to public/utility easements. 4/ Allowance based on national statistics by US Dept. of Labor, Bureau of of Labor Statistics, Technical information: "Work at Home i Source: assumptions are generally consistent with the Metro Draft 2009-2030 Urban Growth Report; modified to reflect local observatio Proj. Tigard Net New 20-Year Redevelopment Building Space Needs (Floor Area) Flex/Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Low 1,004,000 114,000 203.000 116,000 168.000 899,000 2.504.000 Medium 1,339,000 152.000 271,000 154,000 225.000 1,198,000 3,339.000 High 1,673,000 191,000 338,000 193,000 281.000 _ 1,498,000 _ 4.174,000 Proj. Tigard Net New 20-Year Building Floor Area on Vacant Lands (Floor Area) Flex/Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Low 495,000 56,000 248.000 141,000 206.000 599,000 1,745.000 Medium 659,000 75.000 331.000 188,000 274.000 799,000 2,326.000 High 824,000 94,000 414,000 _ 235,000 343.000 _ 999,000 2,909,000 Proj. Tigard 20-Year Vacant Lands (gross buildable acres) Flex/Bus. Gen. Office Institutional Park Industrial Warehouse Retail Total Low 25 3 20 11 17 50 126 Medium 33 4 27 15 22 67 168 High 42 5 34 19 28 84 210 i P.: k 1 o ; Tigard 2011 Economic Opportunities Analysis 30 , i. ( APPENDIX C: ANALYSIS OF EMPLOYMENT AND SPACE NEEDS (CONTINUED) Land Use Assignment Assumptions Flex /Bus. Gen. Local Zoning Classification Office Institutional Park Industrial Warehouse Retail Commercial 50% 60% 20% 10% 10% 60% Mixed Use 40% 20% 5% 5% 0% 30% Industrial 10% 20% 75% 85% 90% 10% Total 100% 100% 100% 100% 100% 100% Assumptions by FCS GROUP and Tigard based on local observations. Proj. Tigard 20 -Year Vacant Land Needs Forecast by Zoning Classification, Low Flex /Bus. Gen. Land Use Classification Office Institutional Park Industrial Warehouse Retail Total Commercial 13 2 4 1 2 30 51 Mixed Use 10 1 1 1 - 15 27 Industrial 3 1 15 10 15 5 48 Total 25 3 20 11 17 50 126 Proj. Tigard 20 -Year Vacant Land Needs Forecast by Zoning Classification, Medium Flex /Bus. Gen. Land Use Classification Office Institutional Park Industrial Warehouse Retail Total Commercial 17 2 5 2 2 40 68 Mixed Use 13 1 1 1 - 20 36 Industrial 3 1 20 13 20 7 64 Total 33 4 27 15 22 67 168 Proj. Tigard 20 -Year Vacant Land Needs Forecast by Zoning Classification, High Flex /Bus. Gen. Land Use Classification Office Institutional Park Industrial Warehouse Retail Total Commercial 21 3 7 2 3 50 85 Mixed Use 17 1 2 1 - 25 45 Industrial 4 1 25 16 25 8 80 Total 42 5 34 19 28 84 210 Summary of 20 -Year Vacant Land Demand Forecast by Zoning Classification, Tigard USB (with current zoning regulations) Land Use Classification Low Medium High Commercial 51 68 85 Mixed Use 27 36 45 Industrial 48 64 80 Total 126 168 210 Assumptions by FCS GROUP based on Dec. 2009 Metro 2009 -2035 Urban Growth Report assumptions and local observations. f Tigard 2011 Economic Opportunities Analysis 31 APPENDIX D: ANALYSIS OF RETAIL INFLOW /OUTFLOW Analysis of Retail Development Potential Tigard Area 2010 to 2030 Est. 2010 Population in City 48,100 Roj. 2030 Population in City 62,278 Analysis of Effective Buying Income (EBI) Est. 2010 Per Capita hcome 11 $33,000 Roj. 2030 Per Capita Income 1/ $36,462 Est. 2010 Aggregate EBI (000) $1.587,300 Roj. 2030 Aggregate EBI (000) $2,270,749 Change in Aggregate EBI (000) $683,449 Future 2030 Supportable Retail Development Analysis of Existing & Future Retail Sales Potential 2010 2030 Retail Retail Distributi Buying Buying Total on of Power Power Change Sales Sales Support Supportable Local from from in Retail Attributed Attibuted able Sq.Ft. of New Income by Local Local Buying to Local to Retail Retail Retail Store Residents Residents Power Residents Inflow Sales Development Store Group Group 2/ (000) 2/ (000) 2/ (000) (000) (000) 4/ (000) 5/ Food Stores 8.3% $131,746 $188,472 $56,726 $51.054 $12,763 $63,817 236,000 Eating & Drinking 5.0% $79,365 $113,537 $34,172 $30,755 $13,181 $43,936 162,000 Gen. Merchandise 5.5% $87,302 $124,891 $37,590 $33,831 $27,680 $61,510 227,000 Furniture, Fixtures & Appliances 2.2% $34,921 $49,956 $15,036 $13,532 $11,072 $24,604 91,000 Automotive Services 9.6% $152,381 $217,992 $65,611 $52,489 $42,945 $95,434 352,000 Other/Msc. 11.3% $179,365 $256,595 $77,230 $54,061 $23,169 $77,230 285,000 Total 41.9% $665,079 $951,444 $286,365 $235,722 $130,810 $366,532 1,353,000 Notes: I /Derived from US Census estimates,: assumes .05% annual real income growth. 2/ Store group sales allocations from US. Bureau of Economic Analysis, Consumer Expendure Survey, Westem United States. 3/ Based upon employment estimates: assumes 500 sq.ft. perjob, 5% vacancy allowance. and avg. sales of$275/sq.ft. 4/ Future retail inflow assumed to account for 30% to 45% of total retail sales. 5/Building area assumes $285/per sq. ft. annual sales. and 5% vacancy allowance. Source: analysis by FCS GROUP. ( C• • `r Tigard 2011 Economic Opportunities Analysis 32 APPENDIX E: SUMMARY OF TIGARD EMPLOYMENT ZONES AND REGULATIONS The following is an overview of regulations related employment lands and zones for the City of Tigard. A general description of each zone is provided along with common and specific development standards when applicable. A summary table highlights specific regulations, such as building height, lot size, setbacks, landscaping and lot coverage. COMMERCIAL ZONES Neighborhood Commercial District (C -N) Provide convenience goods and services (those purchased frequently) within a small cluster of stores adjacent to residential neighborhoods. A limited number of other uses such as restaurants, gas stations and medical centers are permitted conditionally. Community Commercial District (C -C) Provide convenience shopping facilities to meet regular needs of nearby (1.5 miles) residential neighborhoods. Typically range in size from 30,000- 100,000 sf on 2 to 8 -acre sites. Separated from other commercial zones by at least one half -mile. Housing is permitted on the second floor at densities not to exceed 12 units /net acre. Limited other uses are allowed conditionally. Mandatory site development review. General Commercial District (C -G) Accommodate a full range of retail, office and civic uses with a City -wide and even regional trade area. Residential uses limited to single family residences on same site as permitted use. A wide range of uses are permitted conditionally. Professional Administrative Commercial District (C -P) Accommodate civic and business /professional services and compatible support services in close proximity to residential areas and major transportation facilities. Within the Tigard Triangle and Bull Mountain Road District, residential uses at a minimum density of 32 units /net acre are permitted in conjunction with commercial development. Heliports, medical centers, religious institutions and utilities are permitted conditionally. Developments are intended to serve as a buffer between residential areas and more intensive commercial and industrial areas. Mixed Use - Central Business District (MU -CBD) Provide a pedestrian friendly urban village in Downtown Tigard. A wide variety of commercial, civic, employment, mixed -use, multi - family and attached single family residences are permitted. All uses are allowed in all areas. Specific Development Standards (18.610): Four sub -areas (see MU -CBD Development Standards Matrix) have different setback and height limits in order to create a feeling of distinct districts within the larger zone. • Pacific Hwy. and Hall Boulevard Corridor: designed to create a "pulse- point" along the Pacific Hwy. corridor. Regional retail draw and potential future high capacity transit. • Main Street - Center Street: pedestrian- oriented with smaller scale development. • Scoffins Street - Commercial Street: higher density residential and employment base of civic, office and commercial uses. Tigard 2011 Economic Opportunities Analysis 33 • Fanno - Burnham Street: medium scale residential or mixed use development. Mixed Use Employment (MUE) Designed to apply to a majority of land within the Tigard Triangle, it permits a wide range of uses including major retail goods and services, business /professional offices, civic uses and housing (multi- family at a max density of 25 units /acre. A wide range of uses are permitted conditionally. Acknowledges a majority of trips by automobile, but supports alternative modes of transportation to the greatest extent possible and encourages a mix of uses. Includes special design standards for Tigard Triangle (18.620). Mixed Use Employment Districts (MUE - 1 and MUE - 2) Apply to areas where employment uses such as office, research and development and light manufacturing are concentrated. Commercial and retail support uses are allowed but limited, and residential uses are permitted when compatible with employment character of the area. MUE -1 example is Lincoln Center (high density). MUE -2 example is Nimbus area (more moderate densities). Mixed Use Commercial District (MUC) Includes land around Washington Square Mall and immediately west of Highway 217. Primary uses include office buildings, retail, and service areas. Also permits mixed0use developments and housing at 50 units /acre. Large buildings encouraged with parking under behind or to sides. Includes special design standards for Washington Square Regional Center (18.630). Mixed Use Commercial (MUC -1) Applies to portion of the Durham Quarry site. Subject to IGA agreement between Tigard and Tualatin. Permits a wide range of uses including commercial lodging, general retail, offices and housing at min density of 25 units /acre and max of 50 units /acre. Includes special design standards for Durham Quarry (18.640). Mixed Use Residential Districts (MUR) Applies to predominantly residential areas where mixed -uses are permitted when compatible with residential use. INDUSTRIAL /INSTITUTIONAL ZONES Industrial Park District (1 -P) Provides appropriate locations for combining light manufacturing, office and small - scale commercial uses (restaurants, personal services and fitness centers) in a campus - like setting. Only those uses with no off -site impacts are permitted. Mandatory site development review and specific design standards (18.530). Light Industrial District (l - L) Provides appropriate locations for general industrial uses, including manufacturing and production, research and development, warehousing and freight movement and wholesale sales activities with few, if any, nuisance characteristics. I igard 2(1 I I Economic oppurtnnilics Anal) ;is 34 Heavy Industrial District (I -H) Provides appropriate locations for intensive industrial uses including I -L uses as well as railroad yards and waste - related activities. Uses include those which involve the use of raw materials, require significant outdoor storage and generate heavy truck and /or rail traffic. Properties are carefully located to minimize impacts on established residential, commercial and light industrial areas. 1 igard 2011 Economic Opportunities Analysis 35 COMMERCIAL DEVELOPMENT STANDARDS MUE R -25 STANDARD C -N C -C91 C -G C -P MU- C -G MF DU" MUC -1 MUC MUE 1 MUE 2 MUR 1 MUR 2 CBD" t101ual 11 Iroll�an I'"rttos] /10)1151 Minimum Lot Size 5.000 sq 5,000 sq 0 None 6,000 sq ft None None - None None None None None None - Detached unit ft - - - - 1,480 sq ft - - - - - - - Boarding, lodging, - - - - . 6.100 sq ft - - - - - rooming house - Minimum Lot Width 5011 50ft 50 ft 5011 None 50ft None None None None None None None Minimum Setbacks - Front yard 20ft 0 /20ft " Oft »I 0ft " ❑ 00I ") 20 ft V 08 "I 0 ftl 0 ftl 0ftl 'I 10 ft - Sidefacingstreeton 20 ft - - - ❑ • 20 ft V 0ftl "I 00 0ftl 561 1011 corner & through Ids Iii - Side yard 0/20 ft 18] 0/20 ft 181 0/20 R t8l 0/20 ft 1e1 ❑ 0/20 ft 10 R V 0 0 ft 1301 0 ft 1191 0 III"' 0 11 1201 - Side or rear yard abutting - - - - - 01 30 ft 0 ftu - - - mare restrictive zoning - district - Rear yard 0/20 ft 181 0/20 ft 181 0/20 ft 18] 0/20 ft le] ❑ 20 ft V 0 ftl20/ 0 ft 1291 0 0 - Distance between front - - - - - 0/20 ft 20 ft v 0 N/A N/A 091122] ftI00I1221 of garage & property 151 ft09II20] N/A N/A line abutting a public or - N/A private street. Minimum Building Height N/A N/A N/A N/A ❑ N/A N/A N/A 2 stories 2 stories None 2 stories None Maximum Building Height 35 ft 35 R 45 A 45 ft ❑ 45 ft 45 ft 70 ft 200 ft 200 ft 60 ft 75 ft 45 ft Maximum Site Coverage 121 85 % 80 % 85 % 85 % ❑ 85% 80% 90% 85% 85% 85% 80% 80% Minimum Landscape 15 % 20 % 15 % 15 % ❑ 15 % 20 % 10% 15% 15% 15% 20% 20% Requirement Minimum FAR 01 N/A N/A N/A N/A ❑ N/A N/A NIA 1.25 1.25 0.6 0.6 0.3 Minimum Residential N/A N/A N/A N/A ❑ N/A N/A N/A 50 50 25 50 25 Density InPliel uail/ave unit/we _ unit/ acre unit/acre tmit/ace Maximum Residential N/A N/A WA N/A ❑ N/A N/A N/A None None 50 None 50 D Ml _ _ _ un itacre unit/acre * Multiple - family dwelling unit. •"See Table 18.610.1 and Map 10.610.A for development standards. V = See 18.640 - 050.8. ❑ = See Table 18.610.1 and Map 18.610.A for development standards. [1] The provisions of Chapter 18. 795 (Vision Clearance) must be satisfied. [2] Includes all buildings and impervious surfaces. [3] Applies to all nonresidential building development and mixed use development which includes a residential component. In mixed use development, residential floor area is included in the calculations of floor area ratio to determine conformance with minimum FAR. [4] Notwithstanding the requirements of Section 18.715.020, minimum and maximum density shall be determined for residential only projects using the number of residential units per acre shown in the above table. The provisions for density transfer described in Section 18.715.030.B apply, using the minimum and maximum density shown in the above table. Any mixed -use or commercial only development does not have a minimum density requirement. [5] For purposes of determining floor area ratio and residential densities, the net development area shall be uses to establish the lot area, determined per Section 18.715.020.A.. [6] Adjustments to minimum density in the Washington Square Regional center area subject to the standards set fart in Section 18.630.020.E. [7] The maximum density requ for developments that include or abut designated Water Resources Ova district Riparian setbacks per Chapter 18.797 are described in Section 18.630.020.D. [8] No setback shall be required except 20 feel shall be required where the zone abuts a residential zoning district. [9] See Section 18520.050.B for site and building design standards. [10] No front yard setback than be required, except a 20 -foot front yard setback shall apply within 50 feet of a residential district. [11] There shall be no minimum front yard setback requirement; however, conditions in Chapters 18.745 and 18.795 must be met. [12] There are no setback requiranents, except 30 feet where a commercial use within a district abuts a residential zoning district. [13] The maximum height of any building in the CBD zone within 100 feet of any residential zoning district shall not exceed 40 feet. [14] Where the side or rear yard of attached or multiple - family dwellings abut a more restrictive zoning district, such setbacks shall not be less than 35 feet. [15] Landscaped areas on existing developed property in the CBD shall be retained. Buffering and screening requirements set forth in Chapter 18.745 stall be met for existing and new development. [16] Lot coverage includes all buildings and impervious surfaces. 117] Modifications to dimensional and minimum density requirements for developments that include or abut designated Water Resources Overlay District Riparian setbacks per Chapter 18.797 are described in Section 18.630.040.F. (18] The requirements contained in the Buffer Matrices in Tables 18.745.1 and 18.745.2 shall be used in calculating widths of buffering/screening and required improvement s to be installed between proposed uses in the MUC, MUE and MUR zones within the Washington Square Regional Center (WSRC) and abutting zoning districts not included within the WSRC, or zoning districts within the WSRC which are not mixed -use. For MUC and MUE zones the requirements for Commercial Zones apply. For MUR zones, the requirements for the Neighborhood Commercial Zone apply. [19] For Commercial and Mixed -use developments, the maximum front and street side yard setback is 10 feet. For Residential only developments, the maximum front and street side yard setback is 20 feet. [20] Side and rear yard setbacks shall be 20 feet when the zone abuts residential districts shown in Section 18.510.020 except R -25 and R-40. [21 ] The maximum setback is 20 feet. [221 The maximum setback is 10 feet. C -N -Neighborhood Commercial District MUC 1 - Mixed Use Commercial CC - Community Commercial District MUC -Mixed Use Commercial CAI- General Commercial District MUE 1 - Mixed Use Employmmt/High Density C-P - Professional/Administrative Office Commercial MUE 2 - Mixed Use Employment/Medium Density MU hiked Use Central Business District MUR 1 Mbted Use Residential/High Density MUR 2 - Mixed Use Residential/Medium Density i t i Tigard 2011 Economic Opportunities Analysis 36 i i k MU -CBD Development Standards Matrix r' 2.3 STANDARD SUB -AREAS Main Street 99W /Hall Corridor Scoffms /Commercial Fanno/Bumharn (MS) (99H) (SC) (FB) Front setback 0/5 ft. Minimum 0 ft. (5 ft for frontage on 0 ft. 0 ft. 99W) Maximum 10 R 25 ft. 20 ft. 20 ft. Side facing street on corner and through lots Minimum 0 ft. 0 ft. 0 ft. 0 ft. Maximum 10 ft. N/A N/A N/A Sideyard Minimum/maximum N/A N/A N/A N/A Rear setback Minimum 0 ft. 5 ft. 5 ft. 5 ft. Maximum N/A N/A N/A N/A Building height Minimum 20 it 20 ft. 20 ft. 20 ft. Maximum (stories/feet) 3 stories (45 ft.) 3 stories (45 ft.) 6 stories (80 ft.) 6 stories (80 ft.) Ground floor height minimum 15 ft. 15 ft. None None Site coverage maximum 100% 90% 90% 80% Minimum landscaping' 0 % 10% 10% 20% Minimum building frontage 50% 50% 50% 50% Residential density (units per acre) Minimum 25 25 25 15 Maximum 50 50 50 50 I This table does not apply to existing development. All new buildings in the district must meet these development standards, including projects using the Track 3 approval process. 2 For standards for development surrounding the future public plaza see Section 18.610.040, Special Requirements for Development Bordering Urban Plaza. 3 See also Section 18.610.045, Exceptions to Standards in the MU -CBD zone. 4 In the MU -CBD zone, required landscaping can be provided on roofs. 5 Landscaping/screening requirements for parking lots must be met. 6 Station Area Overlay permits a maximum of 80 units per acre (see Map 18.610A). 3 stories/45 feet within 200 feet of Fanno Creek Park boundary (see Map 610.A) or within 50 feet of low or medium density residential district. s Minimum density applies to residential -only development (not mixed use). is Tigard 2011 Economic Opportunities Analysis 37 'r. li DEVELOPMENT STANDARDS IN INDUSTRIAL ZONES STANDARD I -P I -L I -H Minimum Lot Size None None None Minimum Lot Width 50 ft. 50 ft. 50 ft. Minimum Setbacks - Front yard 35 ft. 30 ft. 30 ft. - Side facing street on corner & through lots [1] 20 ft. 20 ft. 20 ft. - Side yard 0/50 ft. [3] 0/50 ft. [3] 0/50 ft. [3] - Rear yard 0/50 ft. [3][4] 0/50 ft. [3] 0/50 ft. [3] - Distance between front of garage & property line abutting a public or private street -- -- — Maximum Height 45 ft. 45 ft. 45 ft. Maximum Site Coverage [2] 75 % [5] 85 % 85 % Minimum Landscape Requirement 25 % [6] 15 % 15% [1] The provisions of Chapter 18.795 (Vision Clearance) must be satisfied. [2] Includes all buildings and impervious surfaces. [3] No setback shall be required except 50 feet shall be required where the zone abuts a residential zoning district. [4] Development in industrial zones abutting the Rolling Hills neighborhood shall comply with Policy 11.5.1. [5] Maximum site coverage may be increased to 80% if the provisions of Section 18.530.050.B are satisfied. [6] Except that a reduction to 20% of the site may be approved through the site development review process. I -P - Industrial Park District I -L - Light Industrial I -H - Heavy Industrial Tigard 2011 Economic Opportunities Analysis 38 APPENDIX F: TYPICAL SITE REQUIREMENTS FOR DEVELOPMENT TYPES Typical Criteria For Specific Development Sites c Campus 01 E Industrial/ o Heavy Hi -Tech Electronic and Call Center/ Commercial d Industrial/ General Food Manufacturing Computer Warehouse/ Business Office Shopping O Manufacturing Manufacturing Processing & Processing Assembly Distribution Services (Class A) Center Hotel a' '� N o 5to25 5to10 5to10 10to25 5to25 10to25 3to5 1to5 5to10 3to5 z m Interstate, state Interstate, Interstate, Interstate, state Interstate, state Interstate or Along arterial Arterial Arterial or w state highway highway or state highway highway or highway or limited access Along or streets or street interstate or rinci le or principle a. principle principle principle principle four -lane arterial or in down town visibility, visibility or . `g arterial within arterial within arterial arterial within arterial within highway within streets centers and prefers downtown 1 -10 miles 1 -20 miles within 1-30 1-15 miles 1 -10 miles 1 -15 miles transit areas transit areas centers o miles 1 • Water flow 2 • Water flow • Water flow 2 • Water flow • Water flow 65300 GPD • Water flow 2 24,600 GPD 3,500 GPD 24,000 GPD 210,000 GPD 3 • Water flow 2 • Water flow 2 • Water flow? • Water flow 2 t • Sewer flow 2 74,300 GPD • Sewer flow • Sewer flow 2 • Sewer flow • Sewer flow 36,100 GPD 17,000 GPD 24,900 GPD 58,800 GPD • Sewer flow >_ 11,700 GPD 14,600 GPD 3,500 GPD 14,000 GPD 2 10,000 GPD la • Sewer flow 2 • Sewer flow 2 • Sewer flow 2 • Sewer flow 2 •2 0 MW 74,300 GPD • 0.5 MW • 0.5 MW • 0.5 MW • 0.5 MW f 32,500 GPD 15,300 GPD 22,400 GPD 11,700 GPD Electricity • 0.5 MW Electricity Electricity Electricity Electricity • 1.0 MW • 0.5 MW • 1.0 MW • 0.5 MW • Fiber - telecom Electricity • Broadband • Broadband • Broadband • Broadband 0 °, Electricity Electricity Electricity Electricity F. and route • Fiber - telecom Internet Internet Internet Internet diversity access access access access NCDA - Net Contiguous Developable Acres Source: Compiled by FCS Group based on Business Oregon Industrial Site Certification requirements and industry standards, l4.ai ].= - , 01,1111, t lhpormn111, \n,rhpb I? APPENDIX G: BUILDABLE LAND INVENTORY City of Tigard Buildable Lands Inventory (as of January 1, 2010) Vacant and Part- Vacant Property < 1 acre 1 to 5 acres 5 to 10 acres > 10 acres Total Lots Acres Lots Acres Lots Acres Lots Acres Lots Acres Commercial C -C 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 C -G 19 6.8 6 14.0 2 16.4 0 0.0 27 37.3 C -N 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 C -P 7 2.7 2 6.2 0 0.0 0 0.0 9 8.9 Mixed Use MU -CBD 3 1.1 0 0.0 0 0.0 0 0.0 3 1.1 MUC 3 1.4 1 1.3 0 0.0 0 0.0 4 2.8 MUE 35 13.9 4 6.1 0 0.0 0 0.0 39 19.9 MUE -1 10 3.8 1 1.5 1 5.7 0 0.0 12 11.0 MUE -2 1 1.2 0 0.0 0 0.0 0 0.0 1 1.2 MUR -1 9 3.2 0 0.0 0 0.0 0 0.0 9 3.2 MUR -2 2 0.8 0 0.0 0 0.0 0 0.0 2 0.8 Industrial I -H 0 0.0 0 0.0 0 0.0 0 0.0 0 0.0 I -L 7 2.2 2 4.5 0 0.0 0 0.0 9 6.7 I -P 5 2.0 3 6.7 0 0.0 2 34.7 10 43.4 Total 101 38.9 _ 19 40.4 _ 3 22.1 2 34.7 _ 125 136.2 Summary of Vacant Land by General Land Use Zoning Classification Vacant and Part- Vacant Property < 1 acre 1 to 5 acres 5 to 10 acres > 10 acres Total Lots Acres Lots Acres Lots Acres Lots Acres Lots Acres Commercial 26 9.5 8 20.2 2 16.4 0 0 36 46.1 Mixed Use 63 25.3 6 8.9 1 5.7 0 0.0 70 39.9 Industrial 12 4.2 5 11.2 0 0.0 2 34.7 19 50.1 Total 101 38.9 19 40.4 3 22.1 2 34.7 125 136.2 Source: City of Tigard. I igaril 2011 Lconomie Opportunities :Anal■ sis 38 APPENDIX H: REDEVELOPMENT LAND INVENTORY City of Tigard Redevelopable Potential (Improvement to Land Value)) High (< 0.33) Moderate Low (> 1.00) (0.33 to 1.00) Lots Acres Lots Acres Lots Acres C -C 0 0.0 0 0.0 4 8.5 C -G 8 3.4 13 6.8 158 255.0 C -N 0 0.0 1 0.2 2 2.8 C -P 11 3.8 17 10.9 35 33.6 MU -CBD 24 10.5 50 38.4 86 59.0 MUC 7 12.6 11 24.2 35 155.0 MUE 70 40.5 22 12.3 59 61.8 MUE -1 15 11.5 10 6.9 24 30.9 MUE -2 0 0.0 0 0.0 6 29.4 MUR -1 10 3.9 23 5.6 16 5.3 MUR -2 6 2.4 8 2.6 6 3.0 I -H 2 3.4 4 5.5 9 41.3 -L 3 11.0 8 25.1 61 203.5 I-P 13 12.5 13 28.2 76 193.1 Total 169 115.6 180 166.6 577 1,082.0 Summary of Redevelopable Potential City of Tigard Redevelopable Potential (Improvement to Land Value) High (< 0.33) Moderate Low (> 1.00) (0.33 to 1.00) Lots Acres Lots Acres Lots Acres Commercial 19 7.2 31 17.8 199 299.8 Mixed Use 132 81.4 124 89.9 232 344.3 Industrial 18 27.0 25 58.8 146 437.9 Total 169 115.6 180 166.6 577 1082.0 Notes: Improvement to Land Value calculated from Washington County Tax Assessor data (Sept 2010). 2 196 Properties contained a zero Improvement or Land Value and are not represented here. Source: City of Tigard. I,2.;u.i '!!I I I u,i), m, Ohlu ill t1, An.,l'•i- 34) APPENDIX I: SUMMARY OF STAKEHOLDER INTERVIEWS In support of the City of Tigard's statewide planning Goal 9 Economic Opportunity Analysis, consulting staff interviewed twelve business leaders, employers and economic experts to gather perspectives on the City's current position and future economic opportunities. Summary of interview responses are included after each question, shown in italics. The list of respondents is included at the end of the summary. 1. What is Tigard's primary market advantage within the state and region with regard to attracting population and jobs? What do you feel are its greatest assets? Stakeholders consistently reported that Tigard's location is its primary asset, particularly its proximity to 1 -5 and other major transportation corridors such as Highway 217 and Highway 99W. Other factors frequently cited included Tigard's position relative to Portland, an educated, affluent population, and open spaces. Four respondents mentioned that the size of Tigard and its suburban setting are attractive. Other named assets include the variety of housing options, diversity of office and industrial buildings and availability of land. 2. I'm going to read you a list of seven (7) items. From the list, please identify Tigard's primary strengths as a place to do business. The list below is organized in order of frequency of response, shown in parentheses. • Proximity to 1 -5 and other transportation corridors (11) • Quality of life (10) • Available, skilled workforce (10) • Adequate public infrastructure (transportation, utilities, etc.) (5) • Access to local markets and customers (5) • General business climate (4) • Interaction with firms in the same and /or related industries (2) 3. (Optional- for employers) Do you have plans to maintain or expand your business in Tigard? If not, will you relocate within the region or elsewhere? Why or why not? Most employers who were interviewed said they plan to maintain their current location but are unlikely to expand. Two others said they hope to expand as the economy improves. Reasons for not moving include preferred location, access, and property ownership. One employer said a recent employee survey showed that most of their employees live near the business. One business owner said they may relocate when the current lease expires and relocate to a more thriving business district. 4. What geographic area(s) do you think best define(s) Tigard's competitive market region for commercial office, retail and industrial development? 1 igard 20 1 I I iconoinic Opportunities Anal. sus 40 Most interviewees responded to this question by identifying areas in the City that are thriving or successful employment districts. Four respondents felt that the Tigard Triangle is a particularly competitive market area within the city, especially for industrial and retail uses. One person felt strongly that the Triangle was not as competitive as the Hunziker area. Washington Square and the surrounding area were cited twice as being competitive for retail. Other areas mentioned by one person included Oregon Business Park, PacCorp and the area between Highway 99W and Scholls Ferry Road. 5. The City is interested in redevelopment in its downtown and along the Highway 99W corridor, developing a mixed -use district in the triangle south of Highway 99W and north of Highway 217, and adding more neighborhood commercial uses to meet local needs. Do you agree with these priorities? Why or why not? Are there other areas or corridors the City should focus on? Most respondents agreed with these priorities, though several cautioned against development that would compound existing transportation problems (particularly along Highway 99W). There was support for revitalizing downtown by adding new businesses and destinations; including mixed uses, parks and housing that contribute to a unique identity for the City. There was also a good deal of support expressed for improving the Triangle by adding services and diversifying the types of businesses there with available land. Other ideas for focused efforts included the Tiedeman /Greenburg area, the area north of Highway 99W and in the Oak Street or Locust Street areas by Washington Square. 6. What can Tigard do locally to complement the regional and state economy? Several respondents felt that improvements to the transportation network are important to support the Tigard economy. This included improving conditions for vehicle traffic, providing access to alternative transportation facilities such as bike lanes and light rail, and working with regional agencies (e.g., JPACT) to solve transportation problems. Two respondents suggested that the City needs an economic development department and /or active business recruitment by the mayor, city manager and economic development staff. Other ideas included lower taxes, incentives to start a business or re- locate in Tigard, and grants for small businesses. Two respondents recommended continuing to improve upon the current level of service and responsiveness of City building and planning staff. One suggested retaining large industrial tracts to attract potential employers. 7. What types of land and /or economic development actions or incentives are most needed in the City to nurture job growth and private investment? Respondents' most common suggestion was for the City to improve infrastructure - particularly transportation. Others suggested lowering taxes and strategically reducing system development charges (SDCs) for small businesses or other potential employers. Another suggested using enterprise zones or urban renewal areas to capture future tax revenues. Two others emphasized the importance of diversifying local businesses and professional services, particularly downtown. i i._ >arl .201 1 111),n tumid., 41 8. What actions should be taken by the City to create a more balanced and sustainable community? Interview respondents had several ideas about how to create a balanced and sustainable community. These include diversifying the types of business in the city, adding more transportation options and creating mixed -use districts. Two people said that the City needs to focus its efforts and build a distinct identity and greater sense of community, including supporting local business and adding more commercial services to residential areas. Others suggested creating affordable housing and mixed -use districts near commuter rail and future light rail. Two respondents noted that they thought the City is doing well with its current efforts. 9. Along those lines, the City wishes to better balance jobs and housing. What types of housing do you think are most needed? While three interviewees responded that the current mix of housing is adequate, others suggested the need for a more diverse housing stock. Specific needs include moderate to low- income housing in or near downtown and commercial services, second -floor residential, condominiums and small lot or zero lot line homes. A few respondents suggested siting mixed - income housing near transit routes. 10. What business clusters exist or should exist in Tigard? What can the City do to build and strengthen these clusters? Most interview respondents said that Tigard does not have business clusters other than some collection of general services and industry. One identified a cluster of finance and professional services. Several felt that Tigard has a good diversity of businesses and does not need to build clusters. Others suggested that the City could encourage clusters by recruiting a large company so that supporting organizations follow, or by acquiring and consolidating large parcels to sell to a major employer. One respondent recommended the City find a niche such as specialty medical, technical or manufacturing that does not compete with existing retail establishments including Washington Square. 1 1. What opportunities and challenges are there to expanding the traded sector in Tigard? What goods and services could be produced locally rather than imported, and what could be exported? Most respondents did not have an answer for this question. One suggested that all services are imported and another suggested polling the manufacturing sector to identify existing goods and services offered in Tigard. Another interviewee pointed out that there is a great deal of vacant Class A and B office and industrial space, which is both a challenge and an opportunity for the City to attract new industry and business. 12. Are there certain goods or services that you think are missing in the City of Tigard today? I igard 201 I Lcononlic Opportunities Analysis 42 Goods and services that interviewees said were missing from Tigard include downtown grocery and retail, upscale restaurants and neighborhood commercial services. Others suggested that Tigard needs light rail or bus rapid transit as well as more parks and trails. One recommended that Tigard develop a unique identity based on neighborhood and housing design in order to compete with the large surrounding retail and cited Sierra Madre, CA as a successful example. 13. Is there anything else you'd like to add? Interview respondents offered the following closing comments: • One person stated that he is frustrated with the lack of economic development activity on the part of the City. • Tigard has the opportunity to be a good example for a small city. Improve transportation options and get people off the freeways while maintaining mobility in and between towns. • The City needs to be efficient to support businesses. Be prepared for the economic upturn. Keep an eye on the planning department and have a contingency plan to respond to an increase in business activity (e.g., hire contractors or new staff). • Be sure to "over- communicate" this and other City projects. Explore and use a variety of communication media, including mail and social media. • It is great that the City is doing this type of outreach and planning. • Tigard's city council members toured Vancouver, BC a few years ago to look at urban planning and transportation issues. The trip, hosted by Metro, was very beneficial in generating ideas on how to meet these challenges. List of Interviewees 1. Kirsten Alvares, Gerber Legendary Blades 2. Jonae Armstrong, Washington Square 3. Mark Ellsworth, Economic Revitalization Team 4. Donald Fox, Fox Chiropractic Clinic 5. Mike Marr, Tigard Central Business District 6. Debi Mollahan, Tigard Area Chamber of Commerce 7. Bonnie Nakashimada, George Fox University 8. Jonathan Schlueter, Westside Economic Alliance 9. George Specht, Specht Properties 10. Eric Sporre, PACTrust /Oregon Business Park 11. Mike Stevensen, B &B Printing 12. Eric Turner, GVA /Kidder Matthews 1 igard 2011 Economic Oppirrtunilies Anal) ;is 43 : . Appendix J: 1 i Buildable Lands ' a Washingt•n Re J _'1 and Region • i g. ,l Redevelopment/ • 1 AT r - grill n Refill Potential n 1 �,� t� � City of Tigard - r _—^ M Oregon \ 04 "Ma 11\ - mss. e r ,y , �. Q Cny Limits r� ]] � �° �) O Zoning _+ .., ..G�7 ��g�.1 \ Taxlot Boundary - j ` Wetland A. a r H�� ' IN Water 6 , -� � ' 4 , ... . �� . �� Stream Corridor / -. El h � Q r 100 yr Floodplain �� ® Lard' Buildable Lands r i f ® IN ... , ,. ®` W�t'Wn r > -fl i �' Commercial i 1 1 , r r• Tigard _ - Industrial 1 mt i� , � � r � -Mixed Use ■ �� ` / e Residential m �. � _ Redevelopment Potential � � �' " ■ Improve_Land • .., • L" \ I I Hgh ilt 1 ' ®1 = Moderate i t '� Low Irifillill � .; - Government Owned Land 1 1 •1 - PHCT Corridor Highway 1.., ton 1111 ir gl ow - 1 i / .71"=7,E=.27,,F,;:Ei-;. p t 1 i rr,� 7 . i Ee .per Mk 4 / .. Thy Masten reprvexted en J. me,. man . er Psi' - _slim! tiri l' __,,, _ _ ___ I (/ '1,1 gi i . ...1 or - • i 0, ... ..- ,4 /7 M. z/ SUPPLEMENTAL PACKET FOR Cf /6 a ol-. (DATE OF MEETING) 6161 .--,row Economic Development in Municipalities OVERVIEW and RECOMMENDATIONS July 10, 2012 I Councilor Marc Woodard ` ■ TIGARD City of Tigard NATIONAL National League of LEAGUE orCITIES C ities Training Institute Presented Formulating Effective Economic Development Policy Marketing and Communications Strategies May 17 -19, 2012 I Manhattan Beach, CA Building Public— Private Partnerships (P3) March 10 -15, 2012 I Washington D.C. • City of Tigard , r ` Elements of a Successful City Economic Development Office (EDO) t Place to Call i i i "Formulating effective f 1 economic development policy through marketing ad • Ability to market , a community's comm n unications strategies by "quality of place" to businesses. way of Internet technology is • An effective website that now preferred by EDOs in the private sector." demonstrates a city's amenities. ■ A strategy to take advantage of the [Main seminar speaker: many investments that are good Anatalio Ubalde, CEO and co- founder of GIS Planning] for the community. • Quantify an interrelated model to www.zoomprospector.com determine return on investment. City of Tigard Economic Development and Redevelopment Defined According to Professor of Economics Michael Todaro, economic development is defined by: EDO GIS website Examples • An increase in living standards. Find the right location foryoed. ur company to grow a nd succe • The creation of more opportunities in the www sectors of education, healthcare, employment and the conservation of the j Oklahoma Business a C Property L for environment. www.okcedis.com ■ An implicit increase in the per capita income of every citizen. Grow Your Business in Oregon www. oregon4biz. cam /d ev /www /BO www. diffen.com /difference /Economic Develop Or ego - Oregon Advantage /Expand In ment vs Economic Growth Oregon/ Economic Development Sites and Buildings W ikipedia defines redevelopment: www.tvasites.com /index . ncml ve http: / /en.wikipedia.org /wiki /Redevelopment C ity of Tigard `' ' " . ",} u a s• h x .? • , t ^ , may, • AL; The Role of an Economic Integrator An economic integrator is an experienced practitioner and strategist who: • Administers P3 contracts. • Finds and coordinates appropriate funding through legislative grant opportunities. 07 • Has experience in land use negotiations and contractor development. • Is versed in risk and control policy. • Facilitates the contract negotiation process and "seals the deal." City of Tigard Cities Don't Create Businesses... While cities may not create businesses, they can help or hurt their ability to succeed and grow. Without an integrated EDO, analyzing land use opportunities will continue to be a planning exercise where desired development may not be implemented "as planned." !di Work Flow Disciplines of EDOs It is imperative to: • Understand the needs of local businesses. ` • Create effective lines of communication between businesses and government. do" • Coordinate efforts across multiple agencies to provide regulatory support for business development. 1 ,- 4 e� Build sustainable cities that keep living costs down. `'� How do you measure the success of your EDO? �' r iIe'. fix- y,:?r Mir* 1 41"!.t-P 4 bWi44:,41r.:qr 3 irf City of Tigard l i Wt Lessons Learned from Economic Development Seminars I • Old economic development mentality is out... "I don't publicly give out information about my community because I want businesses to call me so I can explain it to them." • Investors look for city economic development opportunities on the Internet. "Current Internet marketing economic developer operations provide websites with searchable databases of land inventory sites and buildings at a minimum." • Today's business owners and investors want quick access to an inventory of a city's public, private and commercial properties. • Investors are interested in specific information: • Analysis, inventories, demographics, transportation, interactive mapping tools, amenities and city fees /taxes. City of Tigard After the City Website Review - Investor Follow Up An in -house meeting is preferable. The investor may want to speak with a city economic development expert after conducting an Internet marketing review. Topics of discussion may include: • Public–private partnership p p p policies. • How to qualify for associated business fee ' ' - exemptions. — = it • Investor - contractor - builder incentives. • Examples of various P3 contract opportunities. ei: i j��t ,:* £ i i {- , a� , ii,- , ' 4' City of Tigard � " What Turns Off Developers /Investors During the Market Search? Long gone are the days when an investor had to work with one contact in an economic development office that held all the city's real estate and demographic information. Today's Internet marketing technologies can save investors days, weeks or even months in making an informed decision about where to "set up shop." St .. City of Tigard What Does Current Economic Development Wisdom Tell Us? • Those that provide expedient and valued information about opportunities will be successful and remain relevant. • Maintaining a traditional business -as- A NA L. Y I usual model can spell failure. $ 0 L 0 N "The greatest danger in times of PRO SS turbulence is not the turbulence; 09 J E T IVES AP4WORJ( it is to act with yesterday's logic." -Al ON [Formulating Effective Economic Development Policy Seminar] S i ; 9 nay Y5i 5 e fl �� - saw " -y k�, S : City of Tigard �u ° Oregon Provides Economic Development Support and The City of TigYMPRaPe Conservation and Development (DLCD) grant to complete an economic opportunities analysis (EOA). • The Tigard Planning Commission conducted this analysis in 2011 and presented the City Council with options regarding land use rezoning in the Tigard Triangle and Downtown Tigard areas. • DLCD grant to continue the EOA during 2012 -13 fiscal period. City of Tigard Other Indicators that Suggest Cities Should Take an Economic Development Role • The State of Oregon stated that cities are unlikely to see improvements in property tax policies. • Governor John A. Kitzhaber, memo dated May 23, 2012, to City of Gresham Mayor Shane Bemis. • Oregon recommends that cities face budget constraints. • The governor's response to 22 city mayors, acknowledging budget constraints and the state's tax quagmire [Measures 5, 47 and 50]. • Governor Kitzhaber recommends: Achieve economic development. • "I believe the January 2009 report is a good starting point. The issue we now face is revenue reform that will be supported by Oregonians. I would ask for your support for reform efforts that achieve economic development, fairness and simplicity objectives." [Governor Kitzhaber] City of Tigard .. _ .:r'j; ,a"""lt. k '` ,yktz k?,; ,.•._. Transportation Policy that Advances Land Use Opportunities will be Posted to Economic Development Website The Oregon Land Conservation and Development Commission now provides a Summary of Amendments to the Transportation Planning Rule (TPR). [Economic Development— Section 111 • Provides cities much greater land use opportunity to direct land use first, then transit planning. • Provides communities with an option to designate a multimodal mixed -use area (MMA). ■ Gone are the days when roadways directed land use planning. ■ Priority re /development projects can be spotlighted as MMAs. City of Tigard Marketing of Pol that Support City's Economic Development Vision • Direct land use, transportation and MMA vision. F V1/ Q ,Ge RD • Transportation Planning Rules— pr r Open designation of MMA exemptions e 4Sjh essi and partial traffic mitigation. • Consistent land use and P3 policies will likely drive developer interest. • Fair and balanced equity exchanges for desired city development: SDC, city taxes/ fees, credits /exemptions, etc. City of Tigard The Making of Ashland's Economic Development Department: A Success S . Oregon made use of the DLCD grant to complete an economic opportunities analysis, c T Y OF ASHLAND much like Tigard's Planning Commission did in 2011 when it looked at rezoning the Tigard Triangle. • Ashland's City Council adopted their economic development strategy in July of 2011 with an Economic Development Goal for 2012. Objectives of the goal included: • Diversifying the economic base of the community. • Supporting creation and growth of businesses that use and provide local and regional products. • Increasing the number of family -wage jobs in the community. • Leveraging the strengths of Ashland's tourism and repeat visitors. City of Tigard Brammo: Electric Vehicle and Charging Station Manufacturer in Ashland Craig Bramscher is building one of Oregon's ; most promising new electric vehicle and charging station companies in Ashland. Ashland City Councilor Greg Lemhouse, who is also Brammo's director for global fleet development notes: 'Ashland is a community that embraces sustainable business principles and we believe we are an ideal place for high -tech companies to locate." • Small communities benefit from the many local supporting suppliers. • Products made in -state provide jobs and support systems around those jobs. • Gas - powered vehicles are primarily built outside of the U.S. [Reference: Local Focus, May 2012, pg 23.] City of Tigard CCDA Economic Development Teaching Points At their April 3, 2012, meeting, the CCDA hosted Ms. Knox of Shiels IObletz I Johnsen, Inc. (SOJ). SOJ represents business owners in public- private development partnerships to ensure representation with the architect and contractor. Ms. Knox noted: • Tigard has done a lot of great planning work in infrastructure, long -range planning and financial planning. • A city in a public - private partnership needs to determine the best first project that can be replicated. • P3s require a lot of perseverance and stamina. Hiring a project management team with experience in this area is preferred. City of Tigard SOJ: The Five Main Risks from a Developer's Perspective • Political Environment — Does the community support its leaders? Is there consensus in the community for the re /development project? • Building Approvals — Is the city permit process predictable and flexible? • Site Conditions — Are there any environmental concerns or access issues? • • Lenders — Is financing available for the project? • Market — What projects are desirable in the current market? t y d 3 � 4 x a. • City of Tigard Incorporating Economic Development Internet Marketing into City G Qx�� rnent's job to create jobs. . Local government cannot be a proxy for a productive economy, just as infrastructure spending cannot be a proxy for real growth. ■ The demand for viable infrastructure needs to emerge from a productive land use pattern, just as a healthy and viable local government can only emerge from a productive place. • Cities can lead a land use vision through effective website marketing and EDO policies. • If we want stability at the local level, we need to work to make our places more productive. [Better Cities & Towns (council distribution) The predicament of local government, Charles Marohn, June 11, 2012.] http: / /bettercities. net /news -opi n ion /blogs /charles -maroh n /18277 /predi cament- local - government City of Tigard Community Investment Toolkit Provided to CCDA by Redevelopment Project Manager Sean Farrelly, June 21, 2012 1. Financial Incentives 2. Innovative Design and Development Codes 3. Eco- efficient Employment Although loaded with good information, without land use policies in place we cannot effectively prioritize re /development projects. (Ms. Knox, SO1, Inc.) However, the CCDA deals mostly with downtown urban redevelopment projects. MY TAKE: • The information in the investment toolkit is too complex and requires annual updates in order to effectively understand and apply best known methods within the framework of our land use policies. • Requires an economic development department with an expert knowledge base in P3 investor finances, government policies, real estate and contract negotiations. ■ Requires a facilitator knowledgeable in integrating information into a productive, decision- making process flow. City of Tigard A Redevelopment Program Directed by CCDA Although T economic development program provides some of the tactical redevelopment components of an EDO, we lack the complete re /development land use vision, strategic marketing, P3 policy components and financial expertise that would help council leadership to achieve the voters land use vision. In order to be competitive in the 21st century, costs must be sustainable for future generations. We must work strategically to effectively develop and redevelop our community land use vision to foster and sustain our city's market economies. City of Tigard Triumph of the City through EDO Best Known Methods "How our greatest invention makes us richer, sma rter, greener, heal and happier." [Triumph of the City, Edward Glaeser] In order for the City of Tigard to triumph, in accordance with its future re /development, tactical /strategic land use vision, we must decipher and prioritize projects within our various plans relating to: • Downtown Tigard and Tigard Triangle develop a nd improvement ■ Urban renewal ■ C Parking apital Analysis improvement ■ mic opportuniti es analysis ■ ■ Transportation planning in the Southwest Corridor City of Tigard Triumph of the City through EDO Best Known Methods (continued) For Tigard to remain a great place to live, a 21" century economic development organization is necessary. The EDO website would offer interactive demographic data, development partnership opportunities as well as a land use inventory. I personally don't believe we can cost - effectively contract all of this expertise out —it will require an in -house team, including a disciplined economic development director, that will help council prioritize EDO functions. City of Tigard 2 e 1 3 Tigard City Council E DO Goal Recommendation • Recommend EDO council goals— specific for 2013 — during goal setting sessions. • Consider two CACs: City Center Advisory Committee (CCAC) for redevelopment projects and Tigard Development Advisory Committee (TDAC) for new P3 development projects. • Determine project priorities and CCDC toolset requirements based on land use goals and priorities. • Market project priorities via EDO GIS website. • Determine the best sustainability indicators of success. City of Tigard Tigard City Council EDO Goal Recommendation (continued) 2(1 At a minimum, City Council could: • Set economic development organization goals. • Begin phase one of an economic development department with: • GIS inventories on a website, like a city recreation audit (determine need and then build service supply). • Discuss future EDO resources: • FTE for an economic development director with expertise in integration /facilitation of public - private partnerships. • FTE for an assistant economic development director with Internet GIS marketing skills. • Incorporate Community Development and EDO into one department. City of Tigard Council Discussion 3 SUPPLEMENTAL PA IET FOR ID d/ (DATE OF MEETING) A m i& • TtKT11ONIX INC. 1 _ F ... ' L _ � l • 1111 III • ir. j 1F 411, - Tektronix From Howard Vollum interview about move to Beaverton in 1951 We had a five year lease at Seventh & Hawthorne (in Southeast Portland) and the lease was about to expire. The ground there was too small to build an adequate building. We had a three -shift operation there at the last. This wasn't the ideal way to do it, so we wanted to find more space. Obviously, we had to move outside of the city in order to do that. So we looked around and tried to decide which direction to go. It was sort of a choice of deciding whether to go east of the city or west. West seemed more attractive, generally. You had to go a long way east to be where you could get land, and so on. We looked around for a place. One thing we wanted to do was not go so far out that we were out of the Bell system telephone area. At that time West Coast, or whatever it was out there, their service was pretty bad. We found this property close to Sunset Highway on Barnes Road which seemed to meet all of our needs. As I recall it was about five acres at the start. It had a number of attractions. One of the things we were looking for was a place which could provide a wide variety of living accommodations. Our people were in various modes as far as living requirements were concerned. Some were building their own houses. Some wanted acreage. Some wanted apartments. All of these things were quite close in that area. By 1980 Tek was Oregon's largest employer with 20,000 employees worldwide. s , .o, .a,4-' s j r# r r+ aye Intel Excerpt from the Oregon Encyclopedia By 1974, they realized they would have to leave the crowded Santa Clara Valley for a location outside California, where the company could grow as needed. Washington County, Oregon, provided the best opportunity for expansion for the rising company. A ninety - minute flight away from the Bay Area headquarters, suppliers, and key customers, it was well within the 2- hour radius planners had drawn on a map to consider possible locations. Moreover, it had abundant and cheap energy and water. Land also was cheap in Washington County, far less expensive than in most of the rest of the country at the time, and construction costs were similarly low. The local work force was stable and relatively well educated. Finally, the initial location in Aloha was near Portland, an urban area offering social and cultural amenities for the professionals the company wanted to attract. Intel Corporation, the world's leading manufacturer of semiconductors, is Oregon's top private employer with a work force of approximately 15,500 in 2008. • Columbia Sportswear (3,163 employees in 2008) From Brainstorm Magazine HOW THE CITY OF PORTLAND LOST COLUMBIA SPORTSWEAR: The City That Shrinks By Jim Pasero BrainstormMagazine March, 2002 Tim Boyle and Columbia decided, in 2000, that they had out -grown their headquarters in St. Johns. "We wanted to expand our facilities," says Boyle, "and we knew that our building 1 in St. Johns was not a good candidate. So after we did a survey to find out where our employees live, we found that ground zero was the East end of the Morrison Bridge." "In other words, they lived everywhere," says Carl Davis, the company's general counsel, who was chosen to lead the survey for Columbia Sportswear's new home when he was hired in '98. Davis had previously been with NIKE for 17 years, working for five years in Washington, D.C. as the company's top lobbyist to the federal government. "I'm now an expert on land for sale in Portland," jokes Davis, with only a touch of sarcasm about his lengthy search. "In the process of our search we found a building owned by US Bank," says Davis. "It was the old Ben Franklin building on SE Grand & Hawthorne, a six story red brick building. There were only two bidders for the building, MuOregon Tax Research (www.oregontaxes.org) Local Tax Newsomah County and us." After Columbia submitted their bid, Davis thought they had a new home, and one that wouldn't require them building from scratch. "US Bank told us to do our final bid. We submitted the bid and the US Bank attorney called us and told us that the deadline had passed and that the building was ours, and that the other side hadn't made a bid." The other side being, of course, MuOregon Tax Research (www.oregontaxes.org) Local Tax Newsomah County. Columbia Sportswear had a brand new home...until... "That following Monday," says Davis, "the bank's attorney called us again and said 'you got outbid,' and that the county came in with a bid before midnight." And then Davis relates a story he says "has been told to me by several sources. What happened to us was that the county brought in assessors and had the building reassessed so that they could increase their bid and outbid us by $5 million." "The irony," says Davis, "is that once the county increased the assessment and got the building, they then pulled it off the tax rolls, because the county does not pay taxes." Before their move to Washington County, Columbia Sportswear was paying several millions of dollars in taxes to the city of Portland and MuOregon Tax Research (www.oregontaxes.org) Local Tax Newsomah County. "We were never looking for breaks," says Tim Boyle. "What we wanted from the beginning is what you would be offered if you were a brand new business. That ought to be the minimum." Boyle and Davis continued their search, but their story only gets worse. "When I saw the property between OMSI and KPTV," says Davis, "I could picture our employees running on their lunch hour along the Eastside Esplanade, and I could picture a ribbon cutting with Vera looking across the city at the nice view." All of sudden the neighborhood was starting to take shape with the Portland Spirit, KPTV -12, Columbia Sportswear, OMSI, and an extension of Portland Community College located side -by -side on the east bank of the Willamette River —not a bad foundation to begin an eastside renaissance. For the Mayor, and the six floors of city planners at the Office of Planning Design and Review (OPDR), that kind of business renaissance didn't align with the utopian vision. The vision was building a light rail stop and tearing down the Marquam Bridge. As the property sits today, it is owned by PGE. The six and one -half acres originally held a power plant but are currently used only to store utility poles. Davis says of the property, "We liked the site because it has a great view of downtown, so we approached PGE, who owned the property, and they said they wanted to sell. We're an outdoor company, so the process just seemed so sensible: an icon company for the city, building on the riverbank across from downtown." Davis was encouraged because many of the potential sticking points regarding building on the property had already been addressed: the greenway was already in, the bank was stabilized, the property had the designated number of plants required by the city, and there was also a bike path in place. One of the sticking points was the setback from the river the city would require for Columbia's building. "We needed to know," says Davis. "We could have lived with 75 feet, but to this date no setback was ever adopted by the city. They couldn't agree on whether it would be 10 feet, 100 feet, or 200 feet." This is the kind of planning politics that infuriates Dan Yates of the neighboring Portland Spirit. To Yates it is unbelievable that the city couldn't give Carl Davis an answer, "because the setback is right there in the city's code; it's 25 feet." Ken Novack, CEO of The Schnitzer Group, agrees, "The code does say 25 feet." "They (City Hall) like to talk about sustainability," says Yates, "but what this city needs is a regulatory climate that is ethical and regular. Businesses like predictability." The other issue of contention was parking. With four hundred workers at its corporate headquarters Columbia's employees would need a place to park their cars. There was enough property, but the city has something in its code called "area surface parking" which needed to be changed from urban restrictions to suburban use to accommodate the company's workers. Carl Davis worked with Wayne Kingsley and Commissioner Jim Francesconi to have the parking rules changed and they won the issue by a three -to -two vote, with the Mayor and Commissioner Charlie Hales voting against the change. "The mayor was very upset about it," says Davis. Beginning to worry about just how much trouble they could have in building on this property, Davis asked the city for a pre- conference hearing to meet with representatives from the city's various planning departments and determine just how many hurdles would surface. That meeting was held on October 4, 2000. The first thing that went wrong, according to a senior official from PGE, was that the city sent their underlings into a meeting instead of their big guns. In business, with a multi - million dollar deal on the line, would you send your inexperienced people? Where were the senior people from the city, the senior PGE official wanted to know? Davis remembers the initial obstruction from the city being that the property needed to be rezoned. "Well, that would have cost us $10,000 and a minimum of nine months, and they still couldn't tell us where the setback was." And then came the deal sinker: "You have a problem," Davis recounts a planner from Portland Department of Transportation (PDOT) telling him. "He said, 'you can't build surface parking; it's a light rail station. "' "Well, they didn't have a light rail station. What they had was a conceptual drawing of a light rail station," says Davis. This was a light rail station that had previously been denied by voters. Both Davis and PGE pointed out to planners that this property wasn't a light rail station. Davis remembers a representative from Tri -Met saying, "Yes, it is," which was confirmed by the representative from PDOT, who then said according to Davis, "This rule is unwavable and non - negotiable. Do you understand ?!" Davis tried to restore reason in the meeting. "If you get light rail," he told the planners, "we will accommodate it by building a parking structure. You don't have to sell it to us; we will just do it. You have Columbia's word on it." But the city wasn't buying. The PGE official confirms accounts of the meeting, adding that the city has an attitude that amounts to: I don't care who you are. I'll do it my way because I'm in charge. They're really despots, says the official. Sitting in his office more than a year and some months after that meeting, Comm. Francesconi looks physically deflated about downtown Portland's loss of Columbia Sportswear. "Columbia didn't have an advocate in that meeting," says Francesconi. "I don't think the mayor had enough information about what was going on. We could have worked with Columbia. It would have been good for light rail. I believe that a 'field of dreams' approach to economic development, where you say, 'build the perfect city and the business community will come,' is wrong." The mayor doesn't agree. But she does admit to being in the dark about Columbia's frustration saying, "We didn't know about the meeting." That's also what Sam Adams, the mayor's chief of staff, told Carl Davis when he remarked to him afterwards, "Don't blame the mayor. The mayor didn't do anything in this." "And I told him," Davis recalls, "Sam, that's the problem." Then Francesconi throws the match on the fire: "They tell me this wouldn't have happened if Neil was mayor." It's a sentiment voiced by many downtown business leaders. Sam Adams fires back, "Wasn't Neil the mayor when Portland lost Georgia- Pacific ?" The Mayor's response: "I'm not going to respond to that because you wouldn't like where the conversation would go." On October 5th, one day after the infamous meeting, Carl Davis and Tim Boyle drove west to Washington County to look at a potential new home —three buildings just off Cornell Road. They stopped at the Oak Hill McMenamin's Brewpub, drank a couple of Hammerhead Ales, and decided to move, ending a 63 -year relationship with the city of Portland. Carl Davis recounts calling Washington County about zoning for the potential site on Science Park Drive. "The county planner answered, 'What kind of zoning would you like Mr. Boyle ? "' says Davis. Twenty -one days later Columbia Sportswear closed on their new home. Today, Columbia Sportswear has a beautiful new headquarters, one they were able to assemble in an expeditious manner. "I knew from that meeting," says Boyle, "that if we have to fight with the city over whether some planner had destined the property for light rail, and the planner says this is 'non- negotiable' when the voters had already voted it down —well, if you have to fight about that, how difficult is everything else going to be ?" Columbia Sportswear may be happy with their new home, but their treatment at the hands of Portland city planners has left a lot of residual anger among business leaders. BrainstormNW Magazine 3/03 Ready to Admit Failure Facing up to Portland's lagging business growth By Melody Finnemore G3rdcn Cclrbrity Rob Bernardi doesn't fault Portland's city leaders for letting ra r him move his business to Vancouver, Wash., without so much as a phone call asking him to stay. After all, says the president and chief operations officer of Kokusai Semiconductor Equipment Corp., his company is relatively unknown despite its presence in Northeast Portland for close to a decade. "We only have 30 employees. We're not a Nike or an Intel 2 } r / J or a Fred Meyer or anybody big like that. It's possible - nobody even knew we left," Bernardi says. farin up to Portland s laN oq business growth asrr:. _ ;, Films r tGHT AT On the other hand, Bart Phillips, the president of the THE BUBBLE THE FORUM? O m a n ' s M o w We . P.1 as'CIWA"''A mm Columbia River Economic Development Council w Mt# twrtr+q ta. «tdo tauv. on ►t thb '°'r''D`^ "'`c'° nr (CREDC), called Bernardi several times and mailed him cwtoL spet : rtrttan Wtbrt x is coon more than enough material to convince him that a move to Arrw tr�m Vancouver was in his company's best interest. Bernardi had contacted Phillips in late 2003 to gather information that would help him compare the cost of doing business in both cities. "We needed to double our physical space and our lease was ending. We looked at eight properties on both sides of the river," Bernardi says. "We didn't specifically say, `The heck with Portland. We're moving to Washington no matter what we find there. "' What Bernardi found, however, was that Kokusai could save big bucks in taxes and utilities. CREDC's Phillips gladly provided information that outlined the absence of corporate, inventory and income taxes in Washington. Property taxes are lower than Oregon's. Bernardi's due diligence also found electricity cost 7 percent less, there was a 32 percent savings in water fees, and sewer rates were 43 percent lower. In addition to a lower cost of doing business, Bernardi says, Vancouver offered a strong pool of potential high -tech employees. "From a labor standpoint, I've got 8,800 potential candidates to choose from. Some may argue that Oregon has just as many, or probably more, but 16,000 of them work for Intel. We're a great company, but I don't think I'm going to recruit many people away from Intel," he says. The capper for Bernardi was that many of his employees live in Washington, mostly Vancouver. "That became a consideration pretty quickly because I could immediately have 70 percent of my employees be very happy with the decision to move. It would save them commute time and gas money as well as income taxes," he says. Bernardi moved Kokusai Semiconductor to Vancouver in October 2004. He credits Phillips and CREDC with making the decision an easy one by providing all of the cost comparison and other information he needed. "I'm assuming there's an organization like that in Portland, but I wasn't aware of one," Bernardi says. "I realize I could have found the Bart equivalent in Portland and, to be fair, I guess I should have. But, frankly, I don't know how you counter no corporate or income taxes. That's pretty hard to beat." Low business costs —from taxes to utilities to housing —are essential to a city's success, and these days the markets that are doing well are increasingly in smaller communities, says Joel Kotkin. Kotkin compiles Inc. Magazine's annual list of "The Top U.S. Cities for Doing Business," which in 2005 ranked Reno and Boise as the top two cities, respectively. Medford came in fifth on the list. Portland was 105th. In fact, after several years as one of Inc.'s "cities of the future," Portland had the dubious honor of nabbing eighth place on the magazine's 2004 list of the worst cities to do business because of "high costs and the anti- business mood." "I remember many years ago when Portland was doing better than everywhere else, primarily because other cities were resource - oriented and were really getting clobbered. That seems to have reversed itself," Kotkin says. "We've seen that a lot of smaller metro areas are doing very well and are growing very quickly. "As housing prices have grown and the political climate has changed, a lot of people are moving to smaller cities that are perceived as more business friendly and where labor is more available because housing is more affordable," he adds. Vancouver's ability to offer a lower cost of doing business attracted Kuni Automotive Group. The company, which opened its first dealership in Beaverton nearly 40 years ago, relocated its corporate headquarters from Portland. As an S corporation, Kuni Automotive was required to pay state income taxes on automobiles sold outside of Oregon. With 10 dealerships in four states, the company's savings since it moved to Vancouver two years ago has been "significant," says Greg Goodwin, chief executive officer. Kuni Automotive's chief financial officer wrote several Oregon leaders, including the governor's office, about the company's decision to leave Portland. The response was less than overwhelming, Goodwin says. "He received a phone call from Karen Minnis' office, and I don't recall that it led to a substantive conversation or inquiry of any kind," he says, adding that former Mayor Vera Katz's response to news of Kuni's departure was equally unsatisfying. "I don't remember her exact words, but it was to the effect that we were making a mistake. That's the extent of any comment or inquiry that we received. I find that disappointing. "There are a lot of Portland expats living in Vancouver, and I think that points to a fundamental problem," Goodwin adds. Plenty of paper generated within the last couple of years bolsters the argument that Portland is failing as a competitive place to do business: • A 2004 Downtown Business Census conducted by the Portland Business Alliance shows that downtown lost 4,272 workers between 2001 and 2004. Although 235 new workers were added in 2004, the total number declined from 86,769 in 2001 to 82,497 in 2004. • The Oregon Employment Department's latest unemployment figures show that Portland is recovering from the recession slower than other cities. According to the November 2005 report, the Portland metro area is adding new jobs at a slower rate than Bend and Medford. • The Cascade Policy Institute, a Portland think tank, issued a report in November that states the Portland/Multnomah County Business Income Tax prohibits the city's economic growth. Author Steve Buckstein says the perception that Portland is less business friendly than nearby counties is fueled by its higher taxes and unemployment. • The City Club of Portland launched its own study just last month and will spend the next year exploring Portland's strengths and weaknesses as a place to do business. When it's published in January 2007, the report will outline the factors that affect business decisions, how they impact different types of businesses, and how local government and communities should respond. Despite the stack of reports and news clippings to the contrary, there are many who dispute the assertion that Portland is hemorrhaging companies or that it even has a reputation as an anti - business city. "I think some of this is media that repeats something until it becomes a perception on a national level," says John Doussard, Mayor Tom Potter's communications director. "I read an article in the paper that said 14 businesses left town, and it neglected to mention the 81 businesses that started at the same time." Portland has leveraged $96 million in private investment during the first six months of the current fiscal year, according to the Portland Development Commission (PDC). Enterprise zone applications for that period represent nearly $94 million in private capital investment. Recent successes include: • YoCream International Inc., a Portland company founded in 1976, plans to add 21,000 sq. ft. of space to its facility on Northeast Airport Way. • LaCrosse Footwear Inc. announced last fall that it will lease a new 145,000 -sq. ft. building on Northeast Airport Way for its corporate headquarters and distribution center. LaCrosse plans to move into the new space in June. • Asterix Group, a small, women -owned creative services firm, expanded its offices downtown last fall. PDC officials say they provided the company with information about the apportionment of the business license fee and business income tax, which ultimately saved the firm thousands of dollars. • Other recent investments have been made by Oregon Steel Mills, Inc., US Bakery/Franz Family Bakeries and TCI America, according to PDC. Bob Alexander, PDC's economic development director, says the agency is exploring ways it can better communicate its business recruitment and retention efforts. "We're talking with private sector groups and other ambassador groups about ways we can get the word out," Alexander says. "It's almost that we have to get the word out locally about our competitiveness as a national site. We've become our own worst enemy in creating a perception." PDC has enlisted the help of the Portland Ambassadors, a coalition of private industry leaders and public partners formed 20 years ago to support the city's business recruitment and retention efforts. Members of the group often accompany PDC officials who meet with businesses, not only those being courted to move to Portland but also companies already located in the Rose City that have complaints. Many of the complaints, Alexander says, are about the city's business tax burden. "Oregon is not a particularly high -tax state. It's in the mid - ranking compared to other similar areas," he says. "While it is an issue, it tends to be a localized issue within the region that puts us at a competitive disadvantage." Plenty of business people would differ on the state's relative tax position. Rankings vary according to which burdens are being measured. Since the passage of various property tax measures, the state has shifted to greater dependence on fees and assessments rather than overt taxes. Even Gov. Kulongoski acknowledged in a 2002 BNW interview prior to his first gubernatorial campaign, "The problem is that Oregon has moved to a system of fees and assessments." Alexander says PDC does its best to meet with business owners who have expressed discontent with Portland and are considering moving their companies elsewhere. Still, he agrees there is room for improvement. "We've certainly looked at ways we can leverage the Portland Ambassadors and other private business groups," he says. "We're discussing with the brokerage companies ways we can find out about potential losses earlier than we might otherwise." "One of the benefits of having closer communication is that it helps dispel the perception that the city isn't talking to businesses or businesses aren't talking to the city," adds Anne Mangan, PDC's marketing coordinator. "We're really trying to make a stronger effort to communicate with the private sector so they don't feel disenfranchised." For some like Neal Arnston, president and chief executive officer of Albina Fuel Co., it's too little too late. In December, after 94 years on Northeast Broadway, the company moved to Vancouver. "Portland's business climate certainly played a part in that decision because of the unwillingness of the city's leadership to deal with congestion," Arnston says. "I think they're more concerned about the three or four percent of the population who ride buses and light rail and live in Dignity Village. It's a dismal climate and the city government and Metro, collectively, are trying to drive everybody off the streets and onto the train." Arnston says the company's 100 employees were happy to make the move since the lack of income tax in Washington meant a 9 percent pay raise for each of them. When the company announced its plans to leave Portland, just one city official met with Arnston to talk with him about the decision. "The only guy who cared was Jim Francesconi, and we know what happened to him," Arnston says. Doussard, Mayor Potter's press aide, says the mayor had planned a series of public work sessions to address Portland's business tax structure early this year. However, the work sessions were postponed and have not yet been rescheduled. Multnomah County Chair Diane Linn says she is disappointed by the Portland City Council's unwillingness to confront the issue more quickly. "I do feel some frustration about that and I feel we've missed some real opportunities because we didn't move sooner or better," she says. "I'm convinced it harms our business environment. I'm worried about the small and medium -sized businesses and about businesses who pay more than their share. There are some real flaws in how the Business Income Tax has evolved over the years. We're the only county in the state where companies have to pay for the pleasure of doing business." Possible options for tax reform include increasing the amount of compensation business owners can deduct from their taxes, Linn says. However, a proposal by City Commissioner Sam Adams to do just that floundered before the rest of the council. Linn says she hopes to find ways to reduce the county's reliance on the tax because it's an erratic source of funding that provides no certainty to the budget process. "It's a tough one because once you implement a tax of this kind, it's hard to dismantle it," Linn says. "There's a growing reliance on the BIT and Business License Tax (BLT) for school funding, and that's going to become a real issue." Albina Fuel's Arnston gives little credence to the notion of real change within Portland's business climate. For many company owners like him, fundamental improvements should have occurred long ago. "Don't you think they ought to be doing something for the business community before we decide to leave ?" Arnston says. Reno The "Biggest Little City "...and the best place to do business in the U.S. Harry York admits that people questioned his decision to move to Reno, Nev., just over a decade ago. "When I moved here people said, `Why in the hell are you moving to Reno ? "' says York, chief executive officer of the Reno - Sparks Chamber of Commerce. "We had this image as a place where there was nothing but gaming and whorehouses, which wasn't fair, but that was people's perception." Reno's efforts to change that perception have paid off. It ranked first on Inc. Magazine's 2005 list of "The Top U.S. Cities for Doing Business" because of its low housing prices and business - friendly environment. A steady migration of business owners, many of them from California, drove a 14.1 percent increase in business service jobs and a 6.1 percent increase in financial services jobs between 2001 -05, according to the magazine. Entrepreneur magazine ranked Reno as the "Best Small City in America for Small Business" last year, and Fortune magazine ranked it as one of "America's Top Three Booming Towns." Both Time and Forbes touted Reno for its quality of life and business - friendly environment. Chuck Alvey, chief executive officer of the Economic Development Authority of Western Nevada, says Reno has focused on three strategies during the last decade: improving recreational and community amenities, strengthening its business climate, and building a citywide sense of self - esteem. "When I first got here 15 years ago, people were friendly but seemed kind of down on themselves as a city. There wasn't a real sense of community self - esteem," Alvey says. York adds that Reno was well known for its advantageous location and strength as a hub for shipping and distribution because it has no inventory tax. A major change within the last decade has been in Reno's quality of life. Reno began marketing recreational opportunities such as a downtown waterway for kayakers and rafters, a vibrant arts community and its recruitment of national retailers such as Pottery Barn and Williams- Sonoma. City leaders recognized that Reno's school system, marked by a high student pregnancy rate and a low number of teens going on to college, needed a major overhaul. The quality of its housing and health care also improved significantly, York says. Reno's efforts to improve its business climate included streamlining its permitting process by establishing one -stop permit shops and making sure each city within the metro area operates on a similar system to increase efficiency. In addition, Reno privatized its workers' compensation system to control costs and extend reporting periods, Alvey says. Reno recently launched Target 2010, a strategy designed to guide the city as it faces booming population growth and a changing economy. "We're going to keep being competitive and recruiting new business, but over time we're hoping to do a lot more of the expansion and location of startups so we have organic growth instead of poaching from elsewhere," Alvey says. "I don't think that helps the long -term growth of the economy." In marketing itself to companies, Reno offers some minor tax incentives for companies that offer high -wage jobs. What makes it more attractive, however, is that businesses don't have to pay personal income, corporate or inventory taxes, Alvey says. "When we had exclusivity on gaming, that took care of our taxes. In recent years we've had to adjust things, but there have been limits on raising taxes," he says. While the increased competition for gaming has forced Reno to explore other revenue sources, the city will continue to build on its reputation as an affordable place to do business. "Having low taxes isn't a gift, it's an investment," Alvey says. Boise No small potatoes It was a banner year for Boise, Idaho, when it came to national rankings of the best American cities to do business. Idaho's capital city nabbed first place on Forbes' 2005 list and second in Inc. Magazine's most recent ranking, proving the success of its strategy to capitalize on its affordability, says Jeff Jones, Boise's economic development manager. "Our target, contrary to popular belief, isn't large corporations with a lot of employees. Our target is smaller firms, 10 to 15 people, in high -cost, West Coast cities," he says. "These companies rely on labor and if they are going to survive, their employees have to be able to find affordable housing." Boise's average home price is about $240,000, Jones says, noting the ability to find a quality home in Boise for $200,000 gives it an advantage over Oregon and California. "That same house in Portland costs $306,000. When you're dealing with those kinds of dynamics, it makes it easy to be competitive from a labor standpoint," he says. Low -cost utilities are another of Boise's strengths, Jones says, adding that a plentiful supply of hydro dams means Boise offers among the lowest electric bills in the country. He also markets Boise's affordability when it comes to taxes. "Companies are attracted to our ability to balance our sales tax, income tax and corporate tax," Jones says. "We refer to it as the three- legged stool so that none of them are extremely burdensome." Boise is home to Fortune 500 giants such as Micron Technology Inc., Washington Group International, Hewlett- Packard, J.R. Simplot Company, and Albertson's. Those companies have helped the city recruit others. "That's really where 80 percent to 90 percent of our growth will come from. We have great companies, and they help us recruit new ones," Jones says. Spin -offs and a cluster approach to economic development have strengthened Boise's competitiveness as a good place to do business, Jones says. As part of its cluster strategy, Boise's economic development department recruits businesses based on a series of screens that begins with reviewing a company's employment base. "Those that are losing employees I'm not interested in because why waste time on a dead thing ?" Jones says. Payroll increases and a "locational quotient," or labor availability within specific sectors that match Boise's strengths, make up the second and third screens. Companies that pass the three screens are then considered recruitment targets, Jones says. "When it comes to industry recruitment, I'm going to go after companies where I know I have a competitive advantage. You build on the strengths you already have," Jones says. "We do the same analysis on our competitors. I'm sure they don't appreciate it, but all's fair in love and war." Medford E is for effort, enterprise and e- commerce Once known more as a rural haven for retirees than a dynamic business market, Medford has emerged as a hot spot for companies seeking an affordable place to operate. The Southern Oregon city ranked fifth on Inc. Magazine's 2005 list of "The Top U.S. Cities for Doing Business." Among the city's greatest strengths, economic development leaders say, are its status as both an enterprise and electronic commerce zone. Medford was one of four Oregon cities to be designated an e- commerce zone in 2002 by the Oregon Economic and Community Development Department. The designation, which allows Medford to offer income tax relief to businesses, builds on the property tax breaks it has been able to include in its incentives package as an enterprise zone. "The benefit of those two programs is that they provide an incentive to the business community— primarily manufacturing and distribution companies —to do some expansion in exchange for a 10 percent increase in employment," says Gordon Safley, executive director of Southern Oregon Regional Economic Development Inc., a private nonprofit established to help companies in Jackson and Josephine counties create jobs. "For large companies it can provide some significant earnings, and for smaller companies it can help them grow and show them that they are supported by a business - friendly community," he adds. Bill Hoke, Medford's economic developer, says the city worked hard to obtain the e- commerce zone because of its benefits to the business community. "It took a great deal of community involvement. We are one of the most active zones in the area, by far. I publicize it, and I encourage its use in business retention and expansion efforts," Hoke says. "I think one of the secrets of our success is we use the tools we have to the greatest benefit." In addition, Medford is bolstering its business - friendly image by implementing changes to streamline its development review process. "We frontload the process so all of the meetings are held early on," Hoke says. "I act as a point of contact so people can deal with just one person, which is helpful, especially on large projects. If there are questions, I find the answers, and if something needs to be done, I chase it down. It gives people a degree of certainty and confidence because they know I'm there to help." Collaboration among the city, county, utilities, local chambers of commerce, the Southern Oregon Visitors Association, the state economic development department, and private business owners has been crucial to Medford's success as well. A pro- business city council has been invaluable, Hoke adds. "I came in and started a program from scratch and the council has given me 100 percent support in what I do to recruit and retain companies," he says. "One of the keys is to have council support. If you don't have that, it's very difficult to do business." • Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 1 Kirsten J. Day of Perkins Coie LLP Speaker 14: 1 David W. Green of Stoel Rives LLP Speaker 15: 1 WRAP -UP PANEL DISCUSSION: POTENTIAL ISSUES IN A COMPLEX MIXED USE REDEVELOPMENT PROJECT AND THE BEST APPROACHES FOR RESOLVING THEM /9�a ��✓,Q/j / T �"'4 y September 19, 2012 b ,, r� t SUPPLEMENTAL PACKET 1 J FOR ..._... d /,G - 6 (DATE OF MEETING) Dina E. Alexander is a founding partner of Radler White Park & Alexander LLP. She handles all aspects of real estate transactions with an emphasis on acquisitions and dispositions, public /private partnerships, and structured finance. Dina is a member of the bar and actively practices in Oregon, California and Washington. She was recognized in Chambers USA in 2012. Kirsten J. Day is of counsel with Perkins Coie LLP. Her experience includes real estate company management responsibilities, dispute assessment, negotiating and managing regulatory environmental compliance agreements and other legal/business questions and issues faced by real estate companies. While General Counsel for Pacific Realty Associates, L.P. (PacTrust), Kirsten handled a 16 million square foot national portfolio of office, retail and industrial commercial real estate. She maintains bar membership in California as well as Oregon. David W. Green, a partner with Stoel Rives, has been recognized in The Best Lawyers in America and Chambers USA. His expertise in real estate financial transactions for major lenders includes negotiating and structuring sale- leaseback transactions and structured finance transactions. The information contained in this outline should not be relied upon as comprehensive. These materials are not intended by Perkins Coie LLP, Radler White Parks & Alexander LLP, Stoel Rives or any of the presenters as legal advice, but are merely presented for discussion and illustrative purposes. {00042455;2} 91004- 2500/LE0AL24509212. 2 Law Seminars International j Easements and CCRs ( 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 2 • Kirsten J. Day of Perkins Coie LLP Speaker 14: 2 David W. Green of Stoel Rives LLP Speaker 15: 2 Case Study Uptown Shopping Center /The Westerly 1. Introduction of Panelists. 2. Project Description: Developer is under contract to purchase land (the "Site ") from Seller and intends to build a high rise condominium building with a ground floor retail component on the Site. The Site is part of a surface parking lot that serves an adjoining low -rise retail center ( "Shopping Center ") owned by Seller. (Please see the attached site plan.) The Site contains approximately fifty (50) parking spaces that will be unavailable during construction. Developer's construction plans include a multi- level, underground parking garage. Developer has an option to purchase the adjoining surface lot (the "Surface Lot "). This case study provides an opportunity to discuss some of the unique easement and CC &R issues that arise when a buyer of land wants to develop a high -rise residential building adjacent to a retail center. 3. Easement Issues (Panel): A. Reciprocal Access. (1) In favor of Developer: (a) Over and across Surface Lot - Seller retains right to modify or eliminate Surface Lot so long as Developer retains �. " ( access to the Site. Loading (b) g zone. \,v') (2) In favor of Seller: tyt ti (a) Over and across Site to access Replacement Parking (defined below). B. Soil Nails. (1) Some protruded into public right -of -way and required encroachment permits from PDOT; others protruded into Seller's land and required easements from Seller: (2) PRACTICE TIP: Anytime there is excavation of any depth in proximity to a neighboring structure, there is a risk that the technique to provide temporary lateral support is inadequate and the neighboring structure will settle and suffer cosmetic and/or serious damage. In the same fashion, heavy vibrations from pile - driving can trigger damage claims. Proving the causal connection can be difficult. A precautionary technique that provides such proof is to have a surveyor or engineer take sightings from a {00042455;2} 91004- 2500/LBGAL24509212. 2 2 Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 3 Kirsten J. Day of Perkins Coie LLP Speaker 14: 3 David W. Green of Stoel Rives LLP Speaker 15: 3 distant point to particular spots marked on the neighbor's structure. They can then check those spots during and after construction to determine whether movement did or did not occur. C. Construction Staging. (1) Easement area defined and limited. (2) Temporary, not perpetual in duration. (3) Seller requirements regarding fencing, dust control, noise control, blocking view of Shopping Center and/or signage for Shopping Center, ingress and egress, etc. D. Encroachments. (1) Utility Vaults. (2) Pedestrian Plaza. (3) PRACTICE TIP: It may be important to a lender to differentiate between encroachments into adjoining private property (for which an encroachment agreement or permanent easement may be obtainable) vs. into the public right of way (for which the City of Portland will usually not grant a permanent easement, but will consider granting a revocable license), and also between intentional encroachments (for which a permanent easement may be available, if onto private property) or accidental encroachments (which the developer could remove if the Property were ever destroyed and rebuilt). Lenders prefer permanent easements, of course, since they do not need to worry about what the future costs may be in "curing" the encroachment. E. Construction Crane — PRACTICE TIP: Tower cranes not only extend upward higher than the intended structure's finished elevation, but the long arm of the crane, called a jib or boom, may extend horizontally well beyond the boundary of the building footprint and potentially swing over neighboring property. This is arguably a trespass of the neighbor's airspace and poses a risk not only of collapse, but also of loads being dropped. Sometimes the developer will seek to obtain licenses or easements from the neighbors to address this situation. (An article discussing this topic by Jesse S. Ishikawa was published in the ABA's Property & Probate Journal at pp. 63 -66 (January/February 2006)). F. Landscaping. G. General Items for Consideration in REAs and CC &Rs: {00042455;2} 91004- 2500/LE0AL24509212. 2 3 Law Seminars International I Easements and OCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 4 Kirsten J. Day of Perkins Cole LLP Speaker 14: 4 David W Green of Stoel Rives LLP Speaker 15: 4 (1) Approval of modifications and amendments to REAs /CC &Rs: How many owners need to approve a modification or amendment (ti) to the REA? Be careful about requiring 100% owner approval to \ L 7 all modifications aim d aendme WRAC 1" ICE TIP: Consider .911 distinguishing between major approval items and minor approval items. Also consider overall approval percentage based on square footage held (i.e., owners holding []% of the total square footage in the shopping center /property). S3 (2) Recordation of Memorandum of Agreement versus recording the actua greement. PRACTICE TIP: If an agreement is intended � to run with the land and bind future owners of a property, record the entire agreement rather than a memorandum of the agreement. (3) Multiple layers of REAs /CC &Rs. PRACTICE TIP: Be clear about how REAs and CC &Rs recorded subsequent to the initial easements, covenants and conditions relate to the initial documents and what documents control. If necessary, update the initial _ documents as well. - (4) Tenants as parties to REAs /CC &Rs: Be very careful about agreeing to permit any parties other than the fee owners of the property to be parties to REAs /CC &Rs. PRACTICE TIP: If a tenant (usually a national tenant in a shopping center development) demands that they be a party for purposes of protecting their store and exercising certain control rights over the property, be clear about that tenant's rights. In addition, set an outside date (usually expiration or earlier termination of that tenant's lease) by which the tenant will automatically no longer be a party to the REAJCC&Rs. 4. Replacement Parking: Seller requires Developer to provide alternative, off -site parking during construction and to replace the fifty parking stalls within the one ominium •u . m: o .e tut t e `Reep acet m e - barking "). Deve1 ji r has agreed to provide the Replacement P. e g. One floor o e par mg garage to be constructed on the Site will be platted as a condominium and conveyed to Seller at no cost. A. Timing - When will the Replacement Parking be available? B. Concerns of Seller's lender? (1) Developer's Lender. (2) Seller's Lender - PRACTICE TIP: If the Loan is in a securitized pool, then the Seller may need to pay off or defease the Loan; if not, then Seller's lender will want: (a) partial release payment to release land; (b) assurances that the collateral value of the remaining property is not disproportionately reduced; {00042455;2} 91004- 2500/LEGAL24509212. 2 4 Law Seminars International 1 Easements and OCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 5 Kirsten J. Day of Perkins Cole LLP Speaker 14: 5 David W. Green of Stoel Rives LLP Speaker 15: 5 (c) assurances that the remaining property will comply with parking requirements and other applicable governmental requirements; (d) a timetable and obligation by someone (borrower or buyer) that Seller's Lender can enforce in some way as to how the parking will be created that will replace lost parking spaces; and (e) some kind of "hammer" that Seller's Lender can wield, if the person obligated to replace the parking fails to do so. C. Seller remedies to enforce obligation of Developer to provide Replacement Parking. (1) Remedy Options. (a) Monetary Damages. (b) Specific Performance. (c) Reversion or re- purchase right. (d) Ability to tear down in- process improvements and restore surface parking lot. (e) Opportunity to complete construction of the parking garage. (f) Ways for Seller to protect itself if Developer files for bankruptcy protection and certain remedies are stayed by the bankruptcy action (e.g., a letter of credit or guaranty so that Seller can complete (d) or (e)). (2) Interplay with Developer's construction lender. (a) No amendments or modifications to CC &Rs without Lender's approval, (b) Notices and Cure Rights - Lender will want the right to receive notices of default, commencement of arbitration or other proceedings between the parties, etc., that may be sent to Developer and a reasonable opportunity to cure defaults after expiration of the time period given to Developer to perform. (c) Adequate parking for condo building. (d) Partial Release — PRACTICE TIP: Seller will need partial release of parking condominium unit with no simultaneous pay down of construction loan. It will facilitate release later to have the terms for the partial release well {00042455;2} 9 1 0 04- 25 001LEGAL24509212. 2 5 Law Seminars International !Easements and CCRs f 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 6 Kirsten J. Day of Perkins Coie LLP Speaker 14: 6 David W. Green of Stoel Rives LLP Speaker 15: 6 documented (usually, in the Deed of Trust or Loan Agreement). (e) No Assumption – Developer's Lender is not required to "assume" the Developer's obligation as a condition to being allowed to obtain possession (through a receiver or otherwise) to cure defaults of the Developer, and may stop performing any curative actions at any time, with no obligation to continue them to completion (at least, if and until it is the fee owner). (f) No Reversion for Non - Development — PRACTICE TIP: After the initial closing of the construction loan, Developer's Lender will typically not accept any reversion of fee title, if development does not occur. A subordinate lien to the Seller to secure Developer's duty to develop may work. In some circumstances, a Lender will accept a reversion or repurchase right in favor of a public body, such as PDC, if the land was acquired from the public body, so long as (a) the time period for construction in order to avoid application of the reversion or repurchase is several years longer than it is expected for development to take place, and/or (b) the party exercising the reversion or repurchase is required to pay Lender an amount at least C equal to Lender's outstanding loan (including interest and costs). D. Seller concerns regarding Replacement Parking. (1) Security — How to protect shopping center patrons, employees, and others who use Replacement Parking which is now underground? Require Developer to provide security? Liability issues for both Developer and Seller if either is required to provide security for Replacement Parking. If there is any shared usage of the Replacement Parking by residents of Developer's condo project and the Seller's tenants, invitees, etc., it compels consideration of allocating maintenance costs and rules of usage. Whether fees can be charged for usage is also to be addressed. (2) Employee Parking - PRACTICE TIP: In order to preserve surface parking in the front of the Shopping Center, Seller may consider requiring employees of the Shopping Center tenants to use Replacement Parking, since this parking is harder to access and requires walking further to various stores in the Shopping Center. Does Seller have the right under Shopping Center leases to enact rules and regulations for the Shopping Center to require tenant {00042455;2} 91004- 2500/LE0AL24509212. 2 6 Law Seminars International ( Easements and CCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 7 Kirsten .1. Day of Perkins Cole LLP Speaker 14: 7 David W. Green of Stoel Rives LLP Speaker 15: 7 employees to use Replacement Parking? Security issues for Seller as well if Seller enacts this requirement. (3) Truck access for Shopping Center — PRACTICE TIP: Seller must make sure that delivery trucks for Seller's tenants can easily get to loading docks within Shopping Center. Are loading dock areas and turnarounds protected from encroachment? 5. Height and Use Restrictions: A. In favor of Developer: (1) Developer desires Seller to agree that the Shopping Center will not be expanded, remodeled or rebuilt to a height taller than the tallest existing building. Seller must confirm that Seller can agree to this without running afoul of any tenant leases. Seller has to give serious thought about potential future uses of the site being constrained by any such agreement. If a tenant has the right to remodel/rebuild its premises following casualty or otherwise, can this tenant be prevented from exceeding height limitations? (2) Developer wants restrictions on Seller's future development of the Surface Lot, including location of any improvements on the Surface Lot. B. In favor of Seller: (1) Seller desires the Site to be subject to exclusive use rights set forth in leases of Shopping Center tenants. (2) Seller wants to insure that any future owner of the Site is required to build the building approved by the City. (3) Call out parking requirements specifically (whether by Replacement Parking or otherwise) to make clear that parking requirements must be met at all times. 6. Site Improvements: Seller had future plans to perform substantial tenant improvements to the Shopping Center that were going to trigger additional on -site improvements. Seller required that the site improvements be performed by and partially paid for by Developer. 7. Distressed Real Estate: What to Consider When Purchasing /Redeveloping REO Properties A. PRACTICE TIP: Understand the landscape (i.e., be prepared to complete full enough due diligence on REO properties): {00042455;2} 9 1 004- 2 500/LEGAL24509212. 2 7 Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker - 13: 8 Kirsten J. Day of Perkins Coie LLP Speaker 14: 8 David W. Green of Stoe! Rives LLP Speaker 15: 8 (1) Special servicers: Special servicers are by law short term holders of real estate (REMIC rules generally limit to three year maximum holding period before sale, subject to possible extension of three years). Their asset managers are very bright but do not necessarily come from real estate backgrounds and they have many deals on their plates. These assets managers will not have deep knowledge of, or experience with, the real estate. (2) Lack of information and documentation: REO properties are usually missing leases, rent rolls, NNN back -up and other documentation. (3) Pay particular attention to acts, documents, etc., of prior owner (borrower) of property, as many owners negotiate questionable terms in leases, easements, etc., when the property is losing money. B. PRACTICE TIP: Beware of these red flags when negotiating the purchase and sale agreement, as purchasers who push too hard on these items risk losing the deal: (1) Seller delivery of due diligence documents will be limited: If there are specific documents or issues that concern you, find out early the extent to which the Seller has the relevant documentation or knowledge, as the lack thereof could lead to increased due diligence on your part. (2) Seller representations and warranties are very limited and likely will not extend post - closing. Remember that special servicers are looking to sell the property and get rid of all ownership obligations. (3) Seller indemnifications are almost non - existent. (4) Purchaser remedies for seller default/failure to close are very limited: Reimbursement for due diligence costs if Seller fails to close due to Seller default, but obtaining specific performance remedy can be difficult. (5) Seller contingency to get credit committee approvals before closing. (6) Post - closing seller obligations are non - existent. 8. Other: A. Maintenance Obligations — Who performs what? Who pays? {00042455;2} 91004- 2500/LEGAL24509212. 2 8 Law Seminars International' Easements and CCRs ( 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 9 Kirsten J. Day of Perkins Cote LLP Speaker 14: 9 David W. Green of Stoel Rives LLP Speaker 15: 9 B. Cost allocation issues related to parking condominium. C. Insurance. (1) Seller may require additional insured status for liability insurance both during construction of Site and afterwards. D. Indemnities. E. Priority of Lien for Assessments for Common Costs. PRACTICE TIP: Developer's Lender typically would prefer that the lien be subordinate to the first mortgage lien on the Lender's collateral (first mortgagee would not be bound to pay the assessments if first mortgagee forecloses). If otherwise, then Developer's lender will look even more closely at how costs are allocated and may require reserves to pay assessments. F. Review of Shopping Center Leases. PRACTICE TIP: Seller must review all current leases of Shopping Center before entering into transaction for sale and development of Site in order to confirm any potential issues with tenants which could result from this development (particularly any anchor tenants). If any tenant approvals and/or modifications to tenant leases will be required, Seller must start early and be ready to give tenants something in return for their approval. (1) Tenant control rights over common areas of property and alterations to the common areas. (2) Tenant self -cure rights that extend beyond that Tenant's premises. (3) Reserved parking/no- build/no staging areas. G. Underlying development or improvements agreements with governmental or regulatory authorities. PRACTICE TIP: Be clear on the outside dates for property owner obligations and reimbursements so that such obligations do not run in perpetuity. Otherwise, it is very difficult to sell the property with these agreements in place. {00042455;2} 91004- 2500/LEGAL24509212. 2 9 Law Seminars International I Easements and CCRs 1 09/19/12 in Portland, OR Dina E. Alexander of Radler White Parks & Alexander LLP Speaker 13: 10 _ Kirsten J. Day of Perkins Cole LLP Speaker 14: 10 David W. Green of Stoel Rives LLP Speaker 15: 10 ` ll'' C .0 • 0 ' ; ::,,f 1, ' . 7: - ..,-,..... „.., JJJ , - a. ., ' » ` # y `Li r t , i ,r f 0 f A iy A fitr\. 1 r r N. (1 1 17 .. • Ct g ; ,...4,4 I tin"4 -s -, iik i ;- _, r e:- - 4 * : ) ' F ' -- art . - 4 .... ..., , . „,.., , . , :.. ,.... , ,..„ .., . ... -., 4 r �� 'ylA it. f i i ii„ t 4 • h H ,9 ... ill ''"�'�p_, t om . I 5 _., 4 f gip � [ ' , A . u \ ; ± »F T . � i . ' i (]1 1 TWf .JTV FOU '6'9 Kiva 14 1 INUMS . 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Rives LLP Speaker 15b: 1 A Lender's Perspective on Issues in Complex Mixed Use Redevelopment Projects (David W. Green, Stoel Rives LLP) 1. Adopting a Perspective Based on Relative Risks for Future Arguments. From a Lender's perspective, the counsel for the Lender should not be re- writing EVERY document submitted for review or approval. Instead, the initial analysis should be to see if it "works." If it is a declaration of covenants, conditions and restrictions ( "CCR's ") or a declaration of easements or cross easements between private parties ( "Easement "), does it cover the necessary basics? Beyond the basics, does it create any unusual duties or liens that would be ahead of the Lender's lien and create any problems? 2. Assessing the Risks. Divide documents to be reviewed into three separate piles. Pile #1 - Public easements - easements given to governmental and quasi - governmental entities (e.g., cities, counties, State Highway Department, utility companies, Tri-Met, etc.) for use of land either by the public or the public entity. Pile #2 - Private easements between two private owners for a specific use. Pile #3 — CCR's and Easements between multiple different private parties, and not just the prospective borrower from your Lender client. In a redevelopment project, the risks of arguments between private, competing users are frequently greater than the arguments that might later exist between a borrower -owner and the public bodies in connection with a public easement. Therefore, if the easement is a single party easement agreement from or with a public body, the degree of detail in the public easement is typically less. Key issue: is there a chance that the public body may exercise the Easement in a manner that could materially interfere with operations of the redevelopment party? If not, then the risks are lower and public body's form of easement may work without extensive changes being needed. The pile of documents to be reviewed that deserves the most attention is the one that tries to establish CCR's or Easements between public bodies and/or private parties with multiple different kinds of uses of the Property (e.g., projects in the South Waterfront, or the development of a mixed use retail and residential project with public areas, private retail areas, residential units and condominium owners). 3. Creating or Accepting the Minimum Level of Detail for a Public Easement. The ultimate "minimum ": creating the Easement is by inclusion on a plat or subdivision map. Pluses: easy to do; unlikely to create future comments by buyers, lessees or lenders. Minuses: no detail. Next step up, in terms of levels of detail, would be to use the public body's standard form easement (if any). Generally, if the redevelopment project is complex, this is not enough. 1 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International j Easements and CCRs 1 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 2 Next step up, in terms of levels of detail, would be to take the basic form of public easement and add some basic additional sections to deal with the duty to restore the surface after installation of any underground lines, on -going duties for maintenance, indemnification (may not be acceptable for governmental bodies), rights to grant other easements or uses, and rights of relocation. (See attachment #1). 4. Creating or Accepting the Level of Detail Needed on Private Easements. Private Easements could be created with as skimpy a detail as a public easement, and brevity has the same advantages and disadvantages as noted above. However, for even the simplest project, CCR's are important to govern common use issues and maintain the quality and character of the development, and Easements will be needed for access, sewer, storm sewer, electrical lines, water and other utilities, and use of parking. Creating a restriction or an Easement by inclusion on a plat or subdivision map may be expeditious if it is limited to creating easement areas for public uses, such as public utility lines. Other easements (such as easements for access and use of parking) are best handled in a more detailed Easement that is recorded. Private easements for public utilities are comparable to public easements in many respects. Since the installation of the utility may be done by the utility company, or a private contractor working to specifications required by the public utility, the frequency of problems is less than easements granted to private parties. Mostly, easements to private owners for public utilities need to include some detail on how work will be performed (now or on modifications later), and allow some flexibility for the easement area to be relocated or modified. Private easements for parking, access, signs, and other purposes tend to involve relatively higher potential for future arguments about the scope of the Easement and how it is used. For private easements, if you are presented with a form, try to add to the form the essentials, if they are not there, for clauses that will help on enforcement later. (See attachment #1, Sections 1- 6). 5. Enforcing Another Party's Failure to Maintain_ Two approaches to dealing with a party's failure to maintain area under CCR's or Easements: (i) create notice and cure rights for other owners to do necessary maintenance; or (ii) if feasible, allow for the designation and future changes to a party who is "maintenance director" for the Easement area. Spell out the standard of maintenance in reasonable detail, or provide that the areas are to be maintained in accordance with similar first class projects in the same geographic area, or some comparable standard. Build in provisions for owners to cure a defaulting owner's nonperformance, after notice to the defaulting owner and its lender. 6. Maintaining Insurance on Common Facilities /Improvements and for Carrying Commercial General Liability Insurance on Common Areas. If there are material common areas or common facilities (and, sometimes, even if there are not) the CCR's and Easements may provide that owners will maintain insurance on their own property. Review the requirements to make sure there is reasonably flexibility. Allow blanket coverages and 2 Law Seminars International — Wrap -up Panel Discussion. { Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International 1 Easements and CCRs 109/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 3 reasonable deductibles, and limit obligations on delivery of evidence of insurance to certificates of insurance (vs. certified copies of policies, etc.). (See attachment #2, Section 4). If there are obligations of owners to repair casualty and restore, the time periods should be reasonable and there should be an option not to restore, but to raze and put in attractive but vacant condition, unless the nature of the property is that it must "support" other properties, as they support this property, or other factors that warrant a duty to rebuild under all circumstances. 7. Estoppels - Eliciting the Current Status of an Easement. A prospective lender will want to verify the status of compliance with the terms of the CCR's or Easement, especially if there may be assessments for common costs or the possibility of charges for reimbursement of costs by a defaulting owner. Include a section allowing the owner, or a prospective lender or purchaser, to obtain a status certificate or estoppel from other owner(s). (See attachment #2, Section 6.5). 8. Non-payment of Costs — Determining the Priority of the Lien for Unpaid Costs under the Easement. Some but not all CCR's and Easements will provide for a lien for nonpayment of costs that may be chargeable to an owner under the Easement. Generally, attempts to make the lien prior to mortgages or encumbrances by an owner will result in more interaction with future lenders and purchasers than warranted. A "protection of mortgagees" section may provide the right balance — the lender cannot foreclose out the Easement, but a default by an owner cannot lead to a lien foreclosure that would defeat the lien of the mortgage. (See attachment #2, Section 6.8). 9. Time Periods for Default and Cure Rights. The preferred format is for the CCR's or Easements to define reasonable default and cure periods granted to owners AND also provide that the holder of a Mortgage requesting notices shall have a slightly longer time period (after expiration of the cure period granted to the owner) to cure an owner's breach before other remedies may be exercised against the defaulting owner or its property. 10. Resolving Future Arguments between Passionate Parties. The CCR's and Easements should address the key areas that owners and users care about: (1) access; (2) maintenance; (3) joint use rights; (4) default and enforcement; and (5) restrictions (if included). If there are specific actions that the parties want to restrict occurring within the retail development, then they should be stated clearly. Does the document include an attorneys' fees section? Consider requiring that consents, approvals and other decisions that are done by owners under the CCR's or Easements must be made in a commercially reasonable manner. Arbitration or dispute resolution methods may be included, but the views on whether they help resolve disputes or fan the fire up the arguments vary between clients. 3 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International Easements and CCRs l 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 4 CONCLUSION No two projects are the same, and Lenders do not have a single approach in reviewing CCR's and Easements in redevelopment projects. Learn the client's view of the project and whether changes are possible to the CCR's and Easements before trying to review the CCR's and Easements for any problems. Public easements will typically involve less likelihood of future problems than easements created for the benefit of different owners or parcels within a redevelopment project. Private easements for public use are comparable — somewhat less likelihood of problems later, if it is well drafted and clear/ Private easements and CCR's governing the privately owned portion of the Redevelopment project deserve careful review because there is a greater likelihood of arguments later between the competing parties holding rights of use within the redevelopment that conflict with each other. Private easements and CCR's between multiple private parties with different and competing kinds of uses deserve the most attention, from a Lender's perspective. - - David W. Green, Stoel Rives LLP • 4 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International 1 Easements and OCRs 1 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 5 [Attachment #1 — Six Basic Provisions to Look For in Public or Private Easements' The Owner grants to the [City or Public Body], as Grantee, for the benefit of the public, a perpetual non - exclusive public utility easement and right of way (the "Easement ") in, on, over, under and across the real property described in Exhibit A (the "Easement Area "), for the purpose of installing, constructing, altering, repairing, maintaining and operating an underground [water /stouui sewer /sanitary sewer] line and appurtenances ( "Improvements "), together with the right of ingress to and egress from the Easement Area for the foregoing purposes. ADD: I. Restoration after Installation of Improvements. Grantee shall, effective as of the date of completion of any installation of the utility improvements, at Grantee's sole cost and expense, remove all debris and restore the surface of the Easement Area to its previous condition. 2. Maintenance of Utility Improvements. Grantee shall maintain the improvements in safe and proper working condition at all times and shall, if the Easement Area is disturbed by maintenance, alteration, repair or replacement of its improvements, restore the surface of the Easement Area as nearly as possible to the condition in which it existed at the commencement of the maintenance, alteration, repair or replacement, at its sole cost and expense. Grantee agrees to perform all work so as to avoid to the extent reasonably possible, interference with other utilities or access to Grantor's property. Grantee shall keep the Easement Area and Grantor's property free from any liens caused by Grantee, its agents, independent contractors or employees. 3. Indemnification. Grantee shall indemnify and hold Grantor, and the fee owner(s) from time to time of the Property, and their respective agents, tenants, successors and assigns, harmless from and against any and all claims, demands, losses, damages, expenses and liabilities, including without limitation personal injury, and for any damage to or loss or destruction of property, suffered by Grantor, the fee owner(s) from time to time of the Property, and their respective agents, tenants, successors and assigns, arising out of or resulting from the construction, maintenance or use of the improvements constructed by Grantee in the Easement Area or arising out of Grantee's use of the Easement Area; provided, however, that a party shall not be entitled to such indemnification for damage caused by the sole negligence or intentional misconduct of the indemnified party. 4. Reservation of Certain Rights to Use the Surface. Grantor reserves to itself the right to use the surface of the Easement Area for any purpose including landscaping and paved parking; provided, however that Grantor shall not erect, place or construct any permanent buildings or structures on the Easement Area without the written approval of Grantee. 5. Non - Exclusive Easement. The Easement granted hereby shall be non - exclusive and Grantor reserves the right to grant other easement rights in and to the Easement Area; provided that (i) such easement rights shall not interfere with the presence or safety of the underground 5 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, StoeI Rives LLP Law Seminars International ( Easements and CCRs 1 09/19/12 in Portland, OR David W Green of Stoel Rives LLP Speaker 15b: 6 lines and any valves, meters and/or facilities installed in the Easement Area or otherwise substantially interfere with the easement rights granted herein, and (ii) if Grantor lays another type of utility line to or crossing any of the utility lines of Grantee in the Easement Area, Grantor shall comply with all applicable state and federal regulations and the regulations of Grantee for the protection of the Grantee's lines or facilities within the Easement Area. 6. Relocation of Easement by Grantor. Grantor reserves the right to relocate the Easement and lines, valves, meters and facilities within the Easement Area, at Grantor's sole cost and expense, and upon such relocation, the Easement referred to herein shall automatically be deemed to be the Easement as relocated. Such relocation shall subject to the prior written approval of Grantee as to the revised Easement Area location, which approval shall not be unreasonably withheld, conditioned or delayed. C 6 Law Seminars International — Wrap -up Panel Discussion 1 Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 7 !Attachment #2 — EXAMPLE, of Easement Provisions to Look for in Simple Private' Easements) 1. GRANT OF PARKING EASEMENT. 1.1. Grant of Easement. Grantor, as owner of the real property described as "Grantor's Property" on Exhibit A ( "Grantor's Property "), hereby grants and conveys to Grantee, as the pending purchaser /owner of the real property described as "Grantee's Property" on Exhibit B ( "Grantee's Property "), for the use and benefit of Grantee and its customers and invitees (and those of its tenants), an irrevocable non - exclusive easement to use a portion of Grantor's Property designated as "Grantee's Parking Area" on Exhibit C, containing 100 parking spaces, for purposes of tenant, customer and employee parking. Grantee shall have the right to mark or post Grantee's Parking Area as exclusively for the use of Grantee's employees and customers. This grant of easement will be binding between the parties as of the date of execution of this Agreement but will not be effective until Grantee closes its purchase of the Grantee's Property from Grantor. If Grantee does not close the purchase for any reason, Grantee will execute and deliver to Grantor a good and sufficient termination of this Agreement. 1.2 Changes and Relocation Rights of Grantor. Grantor reserves the right from time to time, to alter the access drive ways on Grantor's Property, and/or to reconstruct the improvements located on Grantor's Property. If such alteration or reconstruction requires relocation of Grantee's Parking Area, Grantor shall have the right to relocate Grantee's Parking Area, provided that an equivalent number of parking spaces, located in an area convenient to Grantee's Property, are included in the relocated parking area. Such relocation shall be done in a manner designed to minimize disruption or interference with operation of the business located on Grantee's Parcel and shall be done at the sole expense of Grantor. 2. TERM. The term of the Easement and this Agreement shall be perpetual (except for any termination done in accordance with Section 6.7). 3. MAINTENANCE AND REPAIR. Grantee shall be responsible for maintenance of the Grantee's Parking Area in accordance with standards appropriate for a first class retail development in the greater Portland/Vancouver metropolitan area. Maintenance obligations include sweeping, paving, striping, snow and debris removal. 4. INSURANCE. Grantee shall maintain a policy or policies of public liability insurance covering the Grantee's Parking Area with a combined single limit of liability of not less than $1,000,000 and with umbrella liability coverage up to a total of at least $3,000,000. Grantee will, on request, provide to Grantor evidence of such insurance, which shall name Grantor and any lender or mortgagee of Grantor's Property as an additional insured party. Grantee may self - insure its obligation to insure to the extent that is reasonable in light of its net worth and maintain required insurance under "blanket" policies of insurance. 7 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International Easements and CCRs 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 8 5. EFFECT OF THE AGREEMENT. The rights granted under this Agreement shall run with the land as to all property burdened and benefited by this Agreement, including any division or partition of such property. The rights, covenants and obligations contained in this Agreement shall bind, burden and benefit each party's successors and assigns, lessees, mortgages (or beneficiaries under a deed of trust) as to Grantee's Property or Grantor's Property, or any portion thereof, as the case may be. This Agreement sets forth the entire agreement of the parties with respect to the subject matter hereof. 6. GENERAL PROVISIONS. 6.1 Waiver. Failure at any time to require performance of any provision of this Agreement shall not limit a party's right to enforce the provision. Any waiver of any breach of any provision shall not be a waiver of any succeeding breach or a waiver of any provision of this Agreement. 6.2 Attorneys' Fees. In the event suit or action is instituted to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover from the other party such sum as the court may adjudge reasonable as attorneys' fees at trial, on appeal of such suit or action, and on any petition for review, in addition to all other sums provided by law. 6.3 Rules and Regulations; Regulation of Parking. Grantor will have the right to adopt reasonable rules and regulations consistent with this Agreement to promote safety, order, availability and cleanliness of Grantee's Parking Area, and Grantee will reasonably co- operate therewith, provided that the same do not materially interfere with the exercise of C Grantee's rights under this Agreement or use of Grantee's Parking Area. Grantee's Parking Area will be used for parking of employees and invitees of Grantee's business (and not for overnight storage of vehicles, other than overnight parking of Grantee's vehicles used in connection with the operation of its business at the Grantee's Property, which may be parked overnight 011 Grantee's Parking Area in parking spaces that are nearer to Grantee's Property). Grantee will provide, on request, license plate numbers for vehicles of Grantee and its employees and will cause its employees and invitees to park vehicles within the Grantee's Property or Grantee's Parking Area (and not the remainder of Grantor's Property). Grantee will not change the striping of, or otherwise alter, the parking spaces within the Grantee's Parking Area without Grantor's prior written approval, which will not be unreasonably withheld. If Grantee fails to sweep, stripe or otherwise maintain the Grantee's Parking Area after fifteen (15) days' written notice of work to be done, Grantor may do so and recover the costs from Grantee, with interest at 12 percent per annum from the date of expenditure until reimbursement in full. 6.4 Indemnity. Each party shall defend, indemnify and hold the other harmless from any claim, loss, liability or expense (including reasonable attorneys' fees) arising out of or in connection with the party's own negligence or failure to comply with the terms, restrictions and provisions of this Agreement. 8 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International I Easements and CCRs 1 09/19/12 in Portland, OR David W. Green of Stoel Rives LLP Speaker 15b: 9 6.5 Status Certificate, Information. Within 20 days after receipt of a written request, a party shall promptly deliver a written status certificate to the other party stating (i) whether this Agreement is unmodified and in full force and effect, and (ii) whether (to the best of the party's knowledge) the other party is in compliance with its obligations hereunder, and any other matters that may be reasonably requested. 6.6 Notices. Notices given under this Agreement shall be in writing and will be deemed given and effective when delivered in person to the other party of three (3) business days after being deposited in the U.S. Mails, postage prepaid, and sent by registered or certified mail to the other party's address for notices or upon receipt if delivered by nationally recognized overnight delivery service. Each party shall give notice to each other party of its address for notice by written notice to the other party. In the absence of such notice of a party's address for notice purposes, any notice under this Agreement may be given to the address to which property tax statements are delivered by the taxing authority. 6.7 Amendments. Except as otherwise expressly set forth in this Agreement, this Agreement may not be modified, amended, or terminated except by the written agreement of both parties in a formal termination or modification of easement instrument (or their successors and assigns, as holders of the dominant and servient estates under this Agreement). 6.8 Protection of Rights of Mortgagees. No breach of the provisions in this Agreement will defeat or render invalid the lien of any mortgage(s) or deed(s) of trust now or hereafter executed which affects the parties' respective interests pursuant to this Agreement; provided, however, that upon any sale under foreclosure of any mortgage(s) or under the provisions of any deed(s) of trust, any purchaser at such sale, and its successors and assigns, will hold any and all property interest so purchased subject to all of the provisions of this Agreement. 6.9 Governing Law. This Agreement will be governed and construed in accordance with the laws of the State of [Property Jurisdiction]. 9 Law Seminars International — Wrap -up Panel Discussion Potential Issues in a Complex Mixed Use Redevelopment Project and the Best Approaches for Resolving Them September 19, 2012 David W. Green, Stoel Rives LLP Law Seminars International J Easements and CCRs 1 09/19/12 in Portland, OR J. David Zehntbauer of Dunn Carney Allen Higgins & Tongue LLP Speaker 3: 1 Terminology 101: Issues Arising from Uncertainty over Basic Terminology (e.g. Calling the Document an Easement vs. a License) September 9, 2012 Presented By: J. David Zehntbauer Dunn Carney Allen Higgins & Tongue, LLP / 851 SW Sixth Avenue, Suite 1500 (..„)&._ Portland, Oregon 97204 Telephone: 5 03.224.6440 Facsimile: 503.224.7324 Email: dzehntbauer @dunncarney.com http://www.dunncarney.com J. David Zehntbauer: David Zehntbauer is a partner at Dunn Carney Allen Higgins & Tongue LLP, where his practice focuses on real estate and corporate law. He leads the firm's Real Estate and Land Use team and is also an active member of the Business, Hospitality, Intellectual Property, and Condominium and Planned Community teams. He has extensive experience in commercial property acquisitions and dispositions as well as commercial and residential leasing, lease enforcement and secured financing, both on behalf of lenders and borrowers. David also advises clients regarding loan workouts and mitigation of risk involving troubled assets. In addition to his real estate expertise, David routinely advises clients regarding entity selection, formation and financing, which includes the representation of closely held businesses raising equity financing, mergers and acquisitions and asset and stock sale transactions. David is also active in the community, where he serves as a Director of the Community Warehouse, a member of the NAIOP Public Affairs Committee and participates in several other real estate and business organizations in Portland A portion of these materials regarding easements were co- authored by Dina E. Alexander, Partner at Radler, Parks, White & Alexander, LLP. Ms. Alexander works on development projects from beginning to end, including land acquisition, joint venture, equity and debt financing, construction contract, leasing and sales. She represents both the public and private sectors. Ms. Alexander is licensed in Oregon, Washington and California and earned her J.D. in 1996 from Willamette University College of Law, where she was a member of the Willamette Law Review. The author also thanks Bridget D. Lynn, associate attorney at Dunn Carney Allen Higgins & Tongue, LLP for her assistance with these materials. The information contained in this outline should not be relied upon as comprehensive, as a form bank or otherwise. Any clauses and forms contained in these materials are not forms of Dunn Carney Allen Higgins & Tongue, LLP, Radler, Parks, White & Alexander, LLP, or of the presenter, but are merely examples included for illustrative purposes. Easement, license and covenant issues can be complex, and all agreements should be reviewed by an experienced real estate lawyer. 1 'Page Terminology 101 DCAPDX_829386 v1 Law Seminars international 1 Easements and CCRs 1 09/19/12 in Portland, OR J. David Zehntbauer of Dunn Carney Allen Higgins & Tongue LLP Speaker 3: 2 1. Easement. A. Definitions and Characteristics. (1) What is an easement? An easement is an interest in land which gives a person the right to use and enjoy the land of another. An easement does not grant the right to possess the land but rather the ability to use the land. The use granted may not be inconsistent with any use of the land already being made. Because an easement is an interest in real estate, the grant of an easement is subject to the statute of frauds (i.e., as a general matter, easements need to be in writing). (2) The Jargon. (a) Dominant Estate. The "dominant estate" is the land benefited by the easement. If an easement is appurtenant, an easement cannot be separated from, and is included in a transfer of title to, the dominant estate. (b) Servient Estate. The "servient estate" is the land burdened by the easement. If the easement is appurtenant, this is the land owned by the grantor of the easement. (c) Appurtenant: An easement is "appurtenant" if it grants a right of use that benefits the property owned by the holder of the easement (the grantee). The use of the term "appurtenant" implies there is a dominant estate, which is benefited by the easement. In other words, the easement appertains to the dominant estate. Favored by courts. (d) In Gross: An easement "in gross" is an easement that is unrelated to the land owned by the holder of the easement or to any particular piece of property. An easement in gross is akin to a license in that it can be the mere grant of a personal right to use another's property. If personal, it is not assignable. (e) Grantor: The person granting to another the right to use his or her land. The owner of the servient estate. (f) Grantee. The person to whom the right to use another's land is granted. The owner of the dominant estate if the easement is appurtenant. C 2IPage Terminology 101 DCAPDX_829386_vl Law Seminars International! Easements and CCRs 1 09/19/12 in Portland, OR A 6 EN a M i T&A/_ � y SUPPLEMENTAL PACKET FOR ') / -, -,?4/ (DATE OF MEETING) LAW SEMINARS INTERNATIONAL An Advanced One -Day Workshop on Easements and CCRs Current Uses and Considerations in Oregon September 19, 2012 Portland, OR Development Agreements & CCR Issues in Public and Private Partnerships Eugene L. Grant, Esq. Davis Wright Tremaine LLP Portland, OR j e ca�� 7Z� e � � h �i /Pi7 t's7 - c74- 2 Dri" e-°Y1cP1)' � �� PAP � � � ;�� -�' v ,./2. (e- P A-a\71 /, c„."0 _J..._ v 1/s.,(),,, ),,ol .- • ( r Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6a: 1 [J u rbanland.uh org M http: / /urbanland.utLorg /Articles /2012 /July /ApgarManifesto A "P3" Manifesto by Sandy Apgar and Tony Canzoneri Text Size: A J A I A July 19, 2012 Public /private partnerships (PPPs) are the vehicle of choice to plan and execute many development projects that neither private nor public sector participants could perform on their own. Despite the popularity of PPPs, also known by the emerging moniker "P3s," research and practice have shown that few professionals have mastered the art of designing them, and many business and government leaders are mystified by the complexities of implementing them. Consequently, myths about these partnerships abound and critical community needs remain unmet. We acknowledge our bias to favor PPPs, which is built on three personal beliefs: that business is the main engine for growth and wealth creation in a market economy; that government has an essential role in ensuring legitimacy, individual opportunity, and fairness; and that the partnerships are potent vehicles for bringing the best of both sectors — public and private —to bear on the most challenging problems. What are PPPs —And What Aren't They? PPPs are ventures formed jointly by a government or quasi - governmental organization with one or more privately owned and operated organizations. Their aim is to meet public needs that either partner has identified but neither can meet by acting alone because of insufficient funds or inadequate capabilities. Successful partnerships have four defining characteristics: the partners share responsibility for policy making but the private partner manages implementation; the partnership uses property that is or will be owned by the government; the partners share in the risks and rewards of the project; and the public agency bases its selection of private partners mainly on qualifications rather than price. PPPs are about relationships: they prosper from long -term, enduring cooperation. They fail when an adversarial, contract - oriented management style overtakes the spirit of stewardship and common purpose. Contractors are clever in finding loopholes; partners, however, apply their creativity to improving shared results. While the partnerships must be established on paper, the purpose, terms, and quality of collaboration are far more important than contract provisions to accomplishing the best outcomes. Any partnership that relies on its contract more than its leaders to solve policy and operational problems is doomed. The spirit of partnership is delivered through continuing negotiation, not only for establishing the initial structure and organization, but also for ongoing operations. Successful leaders are skillful in crystallizing principles to guide the negotiating process, defining issues to be negotiated, executing decisions efficiently, reviewing progress and problems, and redefining the objectives as conditions change. The U.S. Army's Residential Communities Initiative Public Agency: U.S. Army. Private Partners: Actus Lend Lease, Balfour Beatty, Clark Realty, Equity Residential, Hunt, Law Seminars International! Easements and CCRs 109/19/12 in Portland, OR • Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6a: 2 Lincoln, Michaels, Piceme, and Pinnacle. Program Purpose /Outcomes: The Residential Communities Initiative (RCI), established in 1998, C cleared a $7 billion maintenance backlog, produced high - quality new and upgraded family housing on Army installations in the United States, and established long -term operations and maintenance responsibility. Partnership Process /Structure: • Selection of private real estate development partners through requests for qualifications, with choice based on past performance, capabilities, and shared vision. • Preparation of collaborative community development and management plans. • Creation of special - purpose entities (for one or more sites) managed by private sector and Army executives, that lease Army land and build, finance, operate, and maintain on -post housing and ancillary facilities for 50 years. • Financing with private equity and debt, secured by the leasehold and housing. Cash flow from basic allowance for housing payments authorized for military members living in private housing. Size: 1 • 85,000 family housing units. • $15 billion in development value, including renovation plus new construction. • 34 projects on 44 sites in 20 states. (In some instances, more than one site was involved in the same partnership.) Public Benefit: • Six-to-one "budget multiplier" of private to public capital (versus Department of Defense threshold of three to one). • Up to 200 percent faster delivery of new and renovated homes compared with conventional govemment processes. • Up to 30 percent lower construction and life -cycle costs compared with conventional government processes. • 100 percent of housing deficit will be met by 2017. • High - quality products and services. • High resident satisfaction. Data source: U.S. Army Public /Private Initiatives Division. (The Army's Residential Communities Initiative ties profiled in an Urban Land interviewtiith Sandy Apgar ('The Promise of Privatization: Lessons from Military Housing, "July 2008.]) These partnerships are not privatization. That misnomer bedevils potential sponsors as they strive to implement PPPs because it implies wholesale transfers of public assets for private gain and eclipses Law Seminars International 1 Easements and CCRs 109/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6a: 3 the partnership principle. Public /private partnerships, by contrast, require partners to engage in active, continuing relationships with shared objectives regarding ownership and operations. PPPs are not designed solely for asset sales, typical sale - leasebacks, design/build contracts, or outsourcing facilities and services. These well - established methods meet particular needs in both the public and private sectors, but they involve different objectives, financing, procurement methods, and working relationships. They may be better solutions than PPPs in many situations and should be considered. Why Should PPPs Be Established? For this discussion, PPPs are collaborations between public agencies and private businesses to finance, plan, build, manage, and /or operate real estate projects. Even the broadest applications, such as mixed -use town centers and major transport hubs, are rooted in real estate strategy and economics and reflect ULI's credo of responsible land use. While PPPs are designed to provide private capital for public projects, their most important contributions often lie in the ingenuity and entrepreneurship of the private partners. One needs only study the U.S. Army's Residential Communities Initiative (RCI), a program to plan, build, and renovate Army family housing, to leam how private partners bring innovation, in addition to capital, to the task of producing public benefits. Public /private partnerships usually are triggered by problems that, especially with media attention, become political and practical concerns. Broken bridges and potholes are symptoms of more fundamental issues that most people do not see and which normal management processes do not address. For example, when the Army faced a $7 billion backlog of unfunded housing maintenance in the 1990s, it was clear that Congress would not appropriate the required funds through the Defense Department budget despite dire predictions and back - channel pleading. Even if it had done so, the government's traditional approach to military housing was more costly and time consuming than the private sector's more holistic and efficient approach. The agility of PPP leaders in collaborative problem solving and compromise throughout a project's life is a counterweight to slow, cumbersome, bureaucratic processes and hasty, insensitive commercial solutions. Both experienced private developers and enlightened public officials embody such problem - solving skills, but the partners must be at the same table on a continuing basis to drive the partnership or it will not work. At times, the lofty goal to "preserve the public interest" and the management skill to "cut through the crap" are complementary parts of their collaboration. A profoundly important, though rarely planned, outcome of a successful partnership process is the sense of public purpose that emerges among the private partners. As the chief executive of an Army PPP developer told one of us, "Our team members, most of whom were not in the military, have developed the soldiers' ethic of selfless service through this relationship. They believe in our mission of community building as much as our clients believe in their service, which produces excellent results." Imagine the extraordinary potential for PPPs to innovate in meeting public needs by engendering this spirit among their teams. As government at all levels faces growing needs and massive budget pressures, public /private partnerships may be the best, if not the only, vehicle for government to meet many of its obligations. When public needs outstrip government resources, elected leaders often lack mandates for taxation that, in theory, would enable them to execute solutions. But even if such public consensus existed, inherent inefficiencies in many govemment processes favor business solutions. The public authority that is responsive and proactive recognizes that partnerships can originate from anyone, anywhere, anytime and establishes a streamlined structure and process to enable their formation and execution. The authority also provides for transparency and accountability, with metrics to ensure that the private partners' returns do not exceed market norms. Features of Successful PPPs Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6a: 4 From professional experience and a review of more than 50 projects in the United States and abroad, we have culled five distinct features shared by successful PPPs: / • Clear definitions and roles — careful delineation of the public properties that the partnership will 1 control, develop, and operate; explicit description of the public needs the project is designed to meet, the desired outcomes, and the measures to assess the partnership's performance in addressing those needs; and top -down leadership by the partnership's executives, with bottom - up support from users and taxpayers who are most directly affected by the PPP's economics and operations. • Robust, mutually beneficial business relationships— strong, reliable business partners with the management and financial strength to plan, drive, and deliver a complex, Tong -term project; open - book relationships to ensure that transaction, status, and performance data are available to all partners and to overseers appointed to ensure the public trust; and rewards to the private sector partners that are commensurate with the risks they assume, based on business models that incorporate direct revenue streams to ensure continuing viability. %� • Holistic, flexible planning and financing for the project's full life cycle —an objective, fact -based � rationale for the partnership's governance and financial structure, with continuous innovations in policy and operations throughout the partnership's life; and engagement of all the major stakeholders — customers, regulators, constituents, suppliers —in the decision - making process, from initial visioning through final disposition. 4 • An integrated internal and external communication plan — professional community outreach and public relations; frequent, managed conversations among all stakeholders throughout each stage of the project; active promotion of early wins in the project's life cycle to demonstrate its potential; periodic progress reports at key milestones; and deeper outcome -based reports on the long- term value for money that can be realized by all stakeholders. `. • A pervasive spirit of stewardship in partnership actions —the business philosophy that reduces the need for thoughtful, creative leaders to rely mainly on contracts as their primary method of governance. The passive disclosure required by regulations is not synonymous with mutual open - book reporting to provide strong checks on individual behavior in partnership spending and actions. Yet, enduring PPPs also encourage proactive enterprise and adaptation to change over each project's life, which can range from 30 to 99 years. The art of PPPs requires tailoring these interrelated features to each particular project. One of the PPP proponent's prime responsibilities is to ensure that each project incorporates the full menu of features but weights them to reflect the specific needs driving its strategy and structure. Wise judgment, infused with common sense, ultimately must prevail. An inflexible, mechanistic approach that appears to yield quantitative results but produces the wrong outcome will quickly lose public and political support. •1 • (. Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6b: 1 urbanland.uli.org http : / /urbanland.uli.org/ Articles /2011 /Fa1111 /KaufmanPartnership Public /Private Partnerships: Wide Ranging Views and Successful Approaches It was pretty much business as usual at Thursday's panel discussion on "Public /Private Partnerships: Solutions for the Next Generation" at ULI's 2011 Fall Meeting in Los Angeles— master plans, local politicians decrying their tight budgets, pay -as- you-go infrastructure takedowns, tiffs over TIFs. Then, veteran developer Morgan Dene Oliver, CEO of Oliver McMillan in San Diego, California, went wildly off script, pointedly refusing to discuss the Buckhead project in Atlanta, which his company recently took over, and going instead for some home truths. "The solution now for all of you," Oliver told the standing - room -only crowd of private developers and public officials packing the room, "is don't invest in anticipation of making money over a very quick period of time if a public /private partnership is necessary to do the business you want to do. I'm not investing a dollar or a moment in public /private partnerships in the for - profit arena." Oliver's take on the current situation, and the near -term outlook for public /private development, encompassed the growing gap between the haves and the have -nots in the U.S. economy as well as the lack of certainty and strong leadership at the local government level. "It's not like it used to be, where politicians theoretically served because they thought they had something really meaningful to contribute," he said. "They need the money. They need their jobs. And it's poison to the notion of public /private partnerships." The budget crisis in local government—including the threat to redevelopment dollars in California —is undoubtedly a core issue for developers working in the public sphere, said moderator Renata Simril, managing director for Jones Lang LaSalle of Chicago. Across the country, 44 states and Washington, D.C., are projecting 2012 budget shortfalls totaling $112 billion, she added. But, Simril noted, that could mean increased opportunities for public /private partnership (P3) projects as public institutions seek to monetize real estate holdings and look to fund an estimated $300 billion in infrastructure projects over the next five to seven years. Still, while 26 states have some kind P3 legislation on the books, the experiences of developers on the panel seem to indicate that the best public /private partnerships may be the ones in which the least public money and risk are involved. Now president of McFarlane Partners in San Francisco, Gregory Vilnick was president of Forest City Enterprises during the late 1990s, when the company took over the redevelopment of Stapleton International Airport in Denver, Colorado. Forest City entered the picture after municipal leaders rejected a public plan that would have cost $100 million just to break ground, Vilnick recalled. The company's solution was a master plan for transforming the decommissioned airport, originally built during the 1920s, in which infrastructure was installed on an as- needed basis, and getting retail off the ground created a revenue stream to continue building, he said. "We negotiated with the city to take the land down over a 15 -year period," he said. "All the infrastructure went in and was paid for either from advances from the company or by bonds. Advances were in the form of bonds the company would take back and monetize and then would reissue them at a lower rate as soon as the existing tax revenues were in place." The project, now half finished, is a walkable Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6b: 2 community with about 2 million square feet (186,000 sq m) of retail space and 5,000 residential units, Vilnick added. At the other end of the spectrum, one area where public /private partnerships still seem relevant is for ( construction of public buildings with a critical function —such as the planned Long Beach, California, courthouse being developed with Meridiam Infrastructure North America of New York at the head of the project team. Joseph Aiello, CEO of Meridiam North America, said his company's plan for the courthouse is based on a P3 model called performance -based infrastructure (PBI) developed byformer British Prime Minister Tony Blair. Private companies are given concessions to design, finance, build, operate, and maintain public buildings. They get yearly payments from the public agencies they contract with, but if the buildings don't perform up to the agreed standards, the companies don't get paid, Aiello said. PBI is now widely used in some parts of Canada, but Aiello said the Long Beach courthouse is the first major rollout of the P3 model in the United States. He sees the model as widely replicable for schools and similar types of critical public projects. "Generally, any public building, any series of public buildings [where large capital expenditures} end up coming to $500 million," he said. "It's about providing public infrastructure for the community." In Long Beach, a strong mayor and community redevelopment plan were also a part of the picture, Aiello said, echoing Oliver's view that the future of public /private partnerships will depend on local officials providing the leadership and certainty developers need. Before taking over the Buckhead project, Oliver said, he went to see the mayor of Atlanta. To get the project going, Oliver said, "I need a public /private partnership. I need you and your staff. I need a partnership and team to help me move this through in an expedited fashion that gets it. "That is a major new form of public /private partnership," he said. "That is a good place to spend your money and time putting it together." Law Seminars International 1 Easements and CCRs 109/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6c: 1 urbanland.uli org m - on . 44. � http: / /urbanland.uli.org /Articles /2012 /Jan /MacCleeryNOMA NoMa: The Neighborhood That Transit Built An infill transit station, built with significant private sector funding, helped transform a desolate swath of Washington, D.C., into a vibrant, vital, mixed -use neighborhood. The neighborhood that has become NoMa (short for north of Massachusetts Avenue), now home to luxury apartments, high -end offices, and dozens of construction cranes raising new buildings, just ten years ago was marked by abandoned warehouses, windswept parking lots, vacant properties, and a methadone clinic. Located just a few blocks north of the U.S. Capitol and the busy Union Station railway hub, the area was adjacent to elevated transit tracks but was not served by a station. Now, eight years after a remarkable financial collaboration by the federal government, the District of Columbia, and local landowners helped build a new infill transit station, the area is undergoing a transformation. The station, opened in 2004 and now called NoMa- Gailaudet U, has been key to the neighborhood's revitalization, which in tum has contributed to the city's financial recovery. It was built on the Red Line of the Metro regional heavy -rail system, which has been operated by the Washington Metropolitan Area Transit Authority (WMATA) since 1976. The Red Line is the Metro system's oldest segment. Despite the fact that the Red Line ran through the area on elevated tracks, the transit system's original planners, using traditional measures of potential ridership that focus on existing development, had not blessed it with a stop. By the 1990s, it became dear that the area's significant land use potential was limited by its lack of a transit station along the Red Line. To address this deficit and make the area an option for new federal office buildings, which must be located near transit, and to spur development, stakeholders launched an effort to fund and build a new infill station one that had never been on a transit plan or map. ULI trustee James Curtis helped lead the early partnership. His company, Bristol Group, acquired in the heart of NoMa the old distribution center for the Woodward & Lothrop department stores —which the firm transformed into a 400,000 - square -foot (37,000 -sq -m) office building now called One NoMa Station —along with eight acres (3.2 ha) of adjacent land as part of a portfolio of assets in the 1990s. A Law Seminars International! Easements and CCRs J 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6c: 2 .'C S w r Metro train runs along elevated tracks on the eastern border of NoMa, as spring daffodils brighten the area. To unlock the potential of NoMa, a public /private partnership was needed. Curtis says everyone involved in the project had to take a leap of faith. "No one, ! think, could have foreseen at the time what NoMa would become," he says. But Curtis was persuaded by the area's pro'dmity to the Capitol and its development potential. For the District, which was in federal financial receivership at the time, the area represented a vastly underutilized land use asset that was spinning off tax revenues of only about $5 million per year. For the federal government, it was a prime potential site for close -in federal office buildings, if only the transit problem could be solved. "We had to break down silos and really think outside the box to make this happen," says Curtis. A particular challenge was bringing along WMATA, which initially was not enthusiastic about the project. In the end, the funding package for the NoMa station totaled $120 million (in 2004 dollars). The D.C. government contributed $9 million for planning and environmental assessment, issued $25 million in municipal bonds to pay for its share of construction, and covered cost overruns, for a total contribution of about $54 million. Congress matched the citVs bond amount and allotted an additional $6 million for partial construction of an adjacent multiuse recreation trail, for a total investment of $31 million. Private developers, recognizing the significant land value upside from the transit expansion, contributed $25 million of their own funding and the equivalent of $10 million in land. The private sector also helped fund technical studies for the station. A nonprofit corporation was created for the project and named Action 29 –New York Avenue Metro Station Corporation —for Action item 29 of the National Capital Revitalization Act, signed by President Bill Clinton in 1997 and calling for a new infill Metro station. Composed of area property owners, major developers, business leaders, and others, Action 29 was incorporated to organize and leverage private investment for the station; it was dissolved after the station opened. Federal and local governments often partner on transit projects, but the significant contribution of adjacent landowners makes this effort stand out. "The results of NoMa have exceeded projections by a wide margin," says Curtis. He gives particular credit to the city, which recognized the economic development potential of the area and the station. "The city knew that high rents and land costs were pushing the federal government out of downtown and into Virginia. It needed to do something to keep these buildings in the District," he says. "All of us also wanted to create a new 'place' in the city, and a transit station was a critical component of that." The investment has paid off: the assessed valuation of the 35 -block area increased from $535 million in 2001 to $2.3 billion in 2007, and the area now generates about $60 million in city taxes annually. The assessed value of One NoMa Station has jumped from $45 million in 2004 to about $250 million currently. NoMa is now home to 16 million square feet (1.5 million sq m) of building space, with 2,700 residential units, two hotels, and 200,000 square feet (19,000 sq m) of retail space, and more construction is planned. Today, the largest tenant is the federal government. The new headquarters building for the Bureau of Alcohol, Tobacco, Firearms, and Explosives, a nearly $100 million investment, opened in Law Seminars International f Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6c: 3 2008 and is wrapped in first -floor retail and restaurant space —a first for new federal buildings in Washington. The District of Columbia government also has a major presence, and National Public Radio is building its new headquarters in the area. Private uses have proliferated as well. In addition to the two hotels, a Hams Teeter supermarket and a variety of restaurants complement the new high -end apartment and condominium buildings springing up in the place of former surface parking lots. Viewers Ketch the film Slumdog Millionaire in a car -free version of a drive -in movie. The NoMa Business improvement District (BID), formed in May 2007, has helped market and promote development of the area. The BID estimates that the NoMa station has catalyzed $3 billion in private investment and over 7 million square feet (650,000 sq m) of development, and that more than 40,000 people have jobs in NoMa. The area still has room to grow: according to the BID, the area is the fastest growing in the city but it is only about 50 percent built out. NoMa is still a work in progress, but its identity is coming into focus, says BID president Robin -Eve Jasper. Its large modern buildings and mix of offices and residential units provide the backdrop for a new set of investments in the public realm and place making, which Jasper describes as an ongoing effort to create connectivity to the established residential neighborhoods around NoMa and to build vibrant community spaces like dog parks, water features, and tot lots. "For a long time, no one was sure if anyone would live in NoMa's new buildings," Jasper says. "But now we know who is here, and it's at just the right time to think about things like parks and the public realm." With the city, the BID is sponsoring tax increment financing legislation that can help pay for needed infrastructure improvements, including upgrades to sidewalks, new parks, and landscaping. In recognition of how far the area has come, this fall the WMATA board agreed to shed the station's clunky original name, New York Ave – Florida Ave – Gallaudet U, and rebrand it as NoMa– Gallaudet U. The renaming of the station is an important symbolic indication that the NoMa neighborhood --once just a no -man's land north of the Capitol and Union Station in need of transformation —is slowly coming into its own as a place. This is the second in a newUrban Land series, `Business on Board, "investigating the business community's role in advancing transit. To be added to the infrastructure mailing list, e -mail infrastructurea_uli. org. To read other articles in this series, see: Seattle and Suburbs Find innovative Compromise to Save Transit Utah Business Embrace Light Rail Law Seminars international 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6d: 1 urbaniand.ulLorg - _ _ _ ry ✓ - - _ M _ http: / /urbanland.uli.org /Articles /2011 /June /SheridanQuincy Quincy, Massachusetts: A New Redevelopment Paradigm In one of the oldest cities in the United States, one of the newest forms of public /private "_. i s ,� t a a partnership is taking shape —an enterprise that - = • could be a model for revitalizing downtowns across the county without straining public a finances. }3 Officials in Quincy, Massachusetts, are ti partnering with Street-Works----a development firm that specializes in the creation of mixed -use districts around public spaces —to transform the city's moribund central business district into a of the future. What's unusual about the Quincy project is that the private sector is doing the heavy lifting— raising significant at -risk, predevelopment capital (Street -Works spent more than $18 million before it even had an agreement with the city), privately acquiring and (without eminent domain), and letting everyone know what it is doing. This is a reversal of the traditional urban development model, in which municipalities pay for public improvements before the private sector starts construction. Quincy envisions financing its infrastructure improvements through new income generated by development - specific revenue supplemented with parking garage revenues. Richard E. Heapes "Street -Works is accepting the upfront risk for permitting and building the public improvements, securing rights to all private land in the development area, guaranteeing a 4 -to -1 ratio of private -to- public dollars in the overall project, and leasing tenant space in advance," explains Richard E. Heapes, principal in White Plains, New York –based Street-Works. "Once revenues start flowing from new additional taxes and public garages, Quincy would purchase the new infrastructure from Street - Works; the city already has agreed to borrow $289 million for this. By working together, the city and Street - Works can get financing for the public improvements sooner and more easily than either party could on its own." What is unusual is that Quincy is not on the hook for one dime until Street -Works finishes the Law Seminars International I Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6d: 2 infrastructure. To support the new construction, the city needs new downtown utilities, roadways, sidewalks, public spaces, and eight public parking garages. Street -Works will secure interim private financing for these improvements upfront. It's a creative solution to a common problem, says Tom Murphy, senior resident fellow, U.LVKIingbeil Family Chair for urban development and former mayor of Pittsburgh, Pennsylvania. "Quincy is one of a number of cities that are becoming much more entrepreneurial in being extremely creative in doing public /private partnership deals," he says. "It used to be that cities weren't as adventurous; they were risk - adverse. But Quincy is sharing tremendous risks with the developer for significant rewards for its citizens. They've figured out how to finance the revitalization of their city." Murphy adds that banks are still reluctant to lend money for large undertakings such as Quincys. "That means increasing numbers of cities will be playing nontraditional roles in financing in nontraditional times," he adds. "Cities still have access to capital through federal money as well as their own ability to float bond issues. I think the Quincy development is a good example of the public and private sectors figuring out how to do a project together with nontraditional financing. I expect to see more. , ,t prefers to refer to the Quincy project as a "private /public" partnership, where the private sector leads the way and the public sector partners to make it happen. Challenges along the way have included tremendous "education" with municipal officials and the public to explain the goals and roles of the players in the process. The old ways of urban development— cities go out and purchase land, tear things down, take out a bond, and put that land out for a proposalhaven't worked and left cities on the hook for millions, says Heapes. 'We have a new paradigm in Quincy. The key to our strategy is that it's market - driven," he adds. "Many urban markets are underretailed, and in some cases under- offced, and in nearly all cases don't have enough residential development. Because of the barriers of land acquisition and entitlement, there is healthy market demand in many urban places." Street -Works created a separate entity Hancock Adams Associates (HAA) —to develop New Quincy Center and is the managing member. HAA will leverage the city's many assets —the Quincy Center MBTA (Massachusetts Bay Transit Authority) station and the historic Church of the Presidents with its tremendous history to create a dynamic, mixed -use environment structured on three primary uses: commercial, retail, and residential, all connected by tree -lined sidewalks, parks, and open spaces. The land agreement stipulates a 2015 start date for the Quincy Center project and an end date as far out as 2039. But Street -Works is targeting an aggressive schedule that would see new construction completed around 2020, with construction beginning in four years. So confident is Heapes that Street -Works recently upped the size of the 40 -acre (16.2 - ha) � W „" project because of market response. it is now a $1.6 billion development with $340 million of public improvements. The program includes' 700,000 square feet (65,100 sq m) of retail uses, 1,400 residential units, over 1 million ` square feet (92,903 sq m) of office space, and two hotels. "None of this space is being built � 'spec,' which would not work with our economic F 4x model," says Heapes. "As of this time, every -d major residential developer in Boston is pursuing us to participate in the residential s _ x program and we could lease the destination anchor retail [340,000 square feet (31,587 sq m)] two times over. The office component is getting serious consideration for education expansion and Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6d: 3 a wellness platform involving major Boston hospitals expanding out of downtown Boston to access more health care customers." Street -Works believes New Quincy Center could be a blueprint for other municipalities in the future. But Ws not easy. A number of factors are required for such a partnership to be successful, including a strategic vision by the public sector with strong leadership; a strong, stable history of city management with a good credit rating; a robust market for market -driven uses; and enough land to acquire without eminent domain to create critical mass to change the perception of the market. "To create urban districts that provide the legal structure for the 'purchase-model' to be utilized requires the approach of performance criteria for public places and extremely flexible zoning," says Heapes. Downtown revitalization such as that envisioned by Street -Works necessitates planning and zoning that is more flexible and allows for a variety of market uses that could come to the site. "In our agreement with Quincy, the zoning [is] within a broad framework," says Heapes. "It's not parcel -by- parcel, or traffic - driven. It doesn't prescribe exact uses for various blocks but allows [for] flexibility. The zoning is more performance - driven. It provides needed economic flexibility. Instead of the city dictating what is built, we worked together to figure it out. We developed trust, which came from the public and private sectors cooperating and figuring it out together. As a result, the private sector can build everything at once. It can be done faster and more cost-effectively. When the private sector builds infrastructure with a legislative agreement by the city to purchase it back, it gives the private sector a guaranteed take -out exit strategy, and allows a separate additional tax to be put in place to pay for that infrastructure." He adds that the Street - Works' model is building a new neighborhood district, not merely one project. "You can't do it with only public leadership or just private leadership," he said. "It takes a true private /public partnership." Law Seminars International 1 Easements and CCRs 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6e; 1 urbartland.uiLorg http : / /urbanland.uli.org/ Articles /2012 /June /uI /PetersonTransit Regional Transit: Regrouping in the Tampa Bay Area A reversal of momentum can take one's breath away. Throughout 2010, the Tampa Bay region seemed poised to join Charlotte, Dallas, Denver, Salt Lake City, Seattle, and other southern and western metropolitan regions transforming themselves through Tight rail and transit- system upgrades. In the Tampa Bay region, local leaders started by tackling the fragmentation of a region made up of seven counties in a state where metropolitan planning and transit service are typically provided at the county level. They pushed state legislation creating the Tampa Bay Area Regional Transportation Authority (TBARTA) in 2007. Two years later, TBARTA released its first master plan, calling for knitting the region together by 2035 with 116 miles (187 km) of rail and bus rapid transit lines, 226 miles (364 km) of express bus service, and 170 miles (274 km) of special lanes for buses, carpool vehicles, and toil - paying vehicles. Adding to the excitement, the Obama administration awarded federal funds for high -speed rail connecting Orlando with downtown Tampa. Political support grew in Tampa's Hillsborough County to finance TBARTA's plans, and county commissioners voted to hold a referendum on a penny sales tax increase dedicated to transportation. But election day in November 2010 brought a "no" from Hillsborough County on the sales tax. That same day, Florida voters chose a new Republican governor, Rick Scott, who would soon pull the plug on high -speed rail, refusing billions of dollars in federal funds. His first budget slashed state funding for TBARTA by over $900,000. To use a football metaphor, it was as if the home team had been driving down the field with the go- ahead score in reach. On first and goal the quarterback gets sacked; on second down, he throws an interception. Monday - morning quarterbacks came up with this analysis: the transit plans were not far enough along for people to rally around them, and the recession was still too deep. Some people pointed fingers at tea party politics. But building the future of regional transit around Tampa Bay is not a game. It is not about winning or losing; the clock does not run out. Leaders in the area, including in the business community, understand that building an economically competitive region boosted by a robust transit system is a long -term project. Short-term setbacks are just that: short term. There will always be something to do next—and then next—and next after that. Developing leadership that can stay the course on regional transit requires an institution that can think and act regionally, and that is where the Tampa Bay Partnership (TBP) comes in. A nonprofit organization with financial support from 175 private and public organizations, the TBP has as its mission advancing the economic development of the region by marketing Tampa Bay nationally and internationally, conducting research, and coordinating business and govemment efforts. Major TBP investors include the region's hospitals, professional sports teams, media companies, business services organizations, universities, and county economic development councils. The Tampa Bay Partnership supported regional transit from the start—from the moment members realized that Charlotte and other "new transit metros" were successfully wooing companies and jobs with the promise of a region connected by high - quality transit service. "Back in 2009, then – Charlotte Mayor [Pat] McCrory told a Tampa Bay crowd he uses Charlotte's transit investments to recruit companies away from Tampa Bay," recounts Stuart Rogel, TBP president and CEO. "This was a wakeup call for Tampa Bay. We knew companies were using transportation as a factor in their relocation decisions, but the reality that a competitor region was leveraging transit— successfully— indicated a real problem. Transit investments are not just for a community's quality of life, but for real Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6e: 2 economic health." An W- 41 K . fi T «x, ,rat d h � empty lot in Tampa wits in vain for the dream of a high -speed rail station to come true. As Americans focus on transportation choices, new data and rankings shine light on the performance of entire transportation systems. When it comes to being able to reach jobs via transit, the Tampa —St. Petersburg— Clearwater area ranks 77th among the 100 largest U.S. metropolitan areas, according to Missed Opportunity: Transit and Jobs in Metropolitan America, a recent analysis by the Brookings Institution. The region also ranks poorly in pedestrian safety, compounding the challenge of expanding transit service and meeting livability objectives. Improving transportation is also critical to the partnership's regional business plan and the accompanying strategic plan for 2012 -2014. "Modern transit will reduce traffic congestion, link together residential and business centers, and encourage higher - density, mixed -use development of residential, office, cultural, and entertainment areas that young professionals want and expect," says Gary Sasso, chair of the TBP's transportation task force and CEO of the Carlton Fields law firm. "Employers want employees and customers from all over the region to have ease of access to their places of business, and they want to know they are operating in a region that is investing in progress, quality of life, and the infrastructure needed to support growth." The 2010 election and its aftermath provided the Tampa Bay Partnership with an opportunity to step back and reassess its approach to advocating for regional transit. Katie Franco, the TBP's vice president for public policy and advocacy, shared the lessons learned and the partnership's resulting five -point strategy: • Passionate leadership. The TBP is uniquely positioned to keep the excitement flowing and commitment level high in the business community. t y , ..__...._. - . • Community education. Dialogue needs to expand beyond business leaders and political leaders; moving forward also requires better outreach to the public. • Structures for regionalism. Confronting fragmentation and supporting coordination across the seven - county region will continue to be important. • Innovative funding. Depending solely on raising taxes is not a winning strategy, public /private partnerships and new approaches to tolls need to be considered, too. • Independent analysis of projects. Being a cheerleader for regional transit in the abstract is not enough; the region needs an independent voice that can also evaluate and prioritize specific Law Seminars International I Easements and CCRs 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6e: 3 projects. The stakes remain high, a point driven home in March when Florida East Coast Industries announced its All Aboard Florida initiative to provide new passenger rail service between Orlando and Miami by 2014. With top speeds of 110 miles per hour (177 kmph), the new rail service would put Atlantic beaches within easy reach of tourist magnet Orlando, placing the Tampa Bay region at risk of being left behind as cities on Florida's east coast exploit the new connectivity the service would provide. 6 ~> Despite setbacks to rail plans, a ULI Advisory Services panel recommended near -term steps to make dovmtot n Tampa transit ready. While the TBP works at the regional level and with the business community, local government initiatives are also advancing. Although Hillsborough County has abandoned, for now, its study of light rail, Pinellas County, home of St. Petersburg, is moving forward. The county and TBARTA released an alternatives analysis in January that recommends creating a nearly 24 -mile (39 -km) light -rail connection between Clearwater and St. Petersburg. Also over the past year, Pasco County adopted an innovative "mobility fee," replacing its flat $10,000 transportation impact fee levied on each new single- family home. The mobility fee, a type of impact fee, provides incentives for development in planned growth areas that can be served by transit, as well as disincentives for rural sprawl. Moreover, revenues are not designated solely for road construction, but also can be used to fund buses, park- and -ride lots, sidewalks, and bicycle infrastructure. In Tampa, a ULI advisory services panel, originally invited to examine development connected to the hoped -for high -speed rail station, found plenty of work that can be done in the near term to make downtown Tampa and adjacent neighborhoods transit ready. Although light rail may be on the back bumer in Hillsborough County, buses are not. Bus ridership in Tampa and the rest of the county rose nearly 12 percent in 2011, continuing a string of annual increases. Meanwhile, the Hillsborough Area Regional Transit Authority and the Hillsborough County Expressway Authority are partnering with the Federal Highway Administration to study bus toll lanes, an innovation that would expand toll roads and bus lanes, collecting revenue through tolls and fares. On the one -year anniversary of the failed referendum in Hillsborough County, the Tampa Bay Times wrote in an editorial, "Last year's vote was a setback, but it cannot be the final word." And it hasn't been. The Tampa Bay area still seems positioned to eventually join Denver, Salt Lake City, and Seattle — regions that also found their way forward after initial "no" votes on plans for regional transit. This article is part of the continuing Urban Land series Business on Board, which investigates the business community's role in advancing transit. To be added to the infrastructure mailing list, e -mail Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6e: 4 mailto:infrastructure anuli.org C Law Seminars International !Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6f: 1 T ft A bus rapid transit project proves a powerful catalyst for development —and transforms the way Cleveland thinks about the link between transportation and jobs. EUCLID AVENUE IN CLEVELAND connects the sible to ignore. Starting in the 1970s, a nearly 3o-year two largest commercial districts in northeast Ohio: debate focused on how to integrate rapid transit downtown Cleveland and University Circle. A micro- along Euclid Avenue. Finally, in 1998 the city set cosm of the city itself, the corridor has experienced aside prohibitively expensive rail plans and decided extreme highs and lows throughout its history. At to move forward with bus rapid transit (BRT). the turn of the 20th century, Euclid was known as The resulting $200 million, 6.8 -mile (si km) Millionaires' Row and was home to the founders of Euclid Corridor Transportation Project catalyzed a Standard Oil and General Electric. But by the time powerful transformation along the avenue. Since the the Great Depression ended, the avenue was dev. BRT line opened in 2008, the corridor has attracted astated, During the 195os, its streetcars were dis- $5.8 billion in investment —$3.3 billion for new Stations on the 6.8 -mile mantled. By the 2000s, the corridor was depressed, construction and $z.5 billion for building rehab, (u km) Healthline bus tined with dilapidated buildings and vacant lots and together totaling more than no projects. Disprov- rapid transit line In Cleveland are transparent, evoking a sense of hopelessness. ing naysayers and exceeding the expectations of constructed of glass But Euclid's role as an essential link between the supporters, the project has generated the economic and steel, well-tit, and central business district downtown and University growth that many thought could only be achieved equipped with emergency blue•light phones and Circle —a hub of world -class medical facilities and arts with raft —and at a fraction of the cost. In 2011, the closed - circult security and culture amenities — rendered the corridor impos- project won a ULl Award for Excellence. cameras. :. "x s .- . i a , nt dam c - �r.,:.z H v- ,,. .,, s -'- - `te ''': "", -,^:- .' r °t`';': f n' ' .. ,. 5. =: + z _: 1. i4 + °. **z „'. „ �7' ` � w "-3��''. . "?...—S. '' °-- s .�? "ate"'" -^4 c la W",. : ^ ^t."� , x ^ ..a. a rz z a^ s _,. .�.#,.• , l rte .' . .._. - r'``.2 'r. F. -1 .,:: . ^,_.., . 2 :1 : s°, =�+ s A ckE .. � . L C rives roviith in c l eve l a n ' - - _w_._,.:„,,,...„..5.1.1..„......7.,_.,.....4,... JASON HELL£NDRUNG `' x ` ' ' `�- k� 2 .,,414 ^sus � ' ll a �.�', , '.., . ° "'- -�"A r 'z - «i R ....k re "" Y: ,, rs, h 47,`,,',..• s.., ' , � x a* _ ,.,,sc t_. L... ' , �4n- , ba`"*'^ r z. .�•^k • s n • d* r7, nf:2 ;. - v -, , -'a sir .., ! C" " :sss, -4 � ....r _ rl.,\ " '. � , ,,wr � ---- -„ - " - .T ' . ,.ter i .. x "a .' z , ` s ,_ °"*�7} tw r . .- t. ak* 's , . '' ,.d , "x°" ' . ' a s � "'� ,, x" �lN � 1 , „ �- . a a ..� ft f � . ss - i k r., � i 3 , T� 6 y , 2tifi z t s r _ . row” ., a^ t . 'SLLYr L - .. -�� ..._�, — ,,, .. .. ^�i«s' -..... .... _ .. ... ..... _.. :., ., ...,.. MAY /JUNE 2072 URBAN LAND 61 Law Seminars International 1 Easements and CCRs 1 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6f: 2 Vir Yr"te t w s A view of Euclid shows , the downtown street before (below) and after (right) development of the HealthLine bus rapid ' r r transit system. Platforms 14^ located In the median reduce interference with sidewalks. i L ii Although the Euclid corridor project secured fund- ing in 2004, the project still struggled to gain initial widespread support. One major challenge was the notion that a bus line would not attract the profes- sional community, instead driving the area's social problems along Euclid Avenue further into the down - town and University Circle districts. Developers and s community members also questioned the project's W ability to stimulate economic growth significantly. ( __ a In response, the RTA and the design team —prime consultant Wilbur Smith Associates of Cleveland and By connecting downtown with University Circle, planning and landscape architect Sasaki Associates the BRT service contributes to the unification of of Boston— adopted a strategy of "thinking rail while Cleveland's top economic generators across the using bus." Dedicated bus Lanes free the buses from entire city. The Cleveland Clinic and University the interference of other traffic. From downtown to Hospitals of Cleveland —the city's two biggest University Circle, buses run along exclusive lanes employers— purchased naming rights to the BRT in the center of the street, which results in greater line in a 25- year, $6.25 million deal. Dubbing it the efficiency. From Public Square [downtown] to Uni- HeaithLine ties the service to Cleveland's branding . versity Circle, we reduced travel time from 3o min- as a hub of medical care and research. By physically utes to 20 minutes," says Michael). Schipper, RTA linking large hospitals, startups, convention space, deputy general manager for engineering and project and cultural amenities, the corridor is propelling management. Cleveland's evolution into a world -class destination Additional features include prominent stations, for the health care and biotech industries.. raised station platforms that match the height of Implementation was made possible by a complex the bus floor to allow same -level boarding, real- funding partnership of multiple organizations, includ time updates of bus arrival times, and off- vehicle ing the Reglonal Transit Authority (RTA) as the proj- fare collection —ail of which imbue the HealthLine ect sponsor, the New Starts program of the Federal • with the sensibility of an urban rail line. Having Transit Administration (FTA), the Ohio Department of fewer stations improves travel times, and platforms Transportation, the Northeast Ohio Areawide Coordi- in the road median reduce encroachment on the nating Agency, the city of Cleveland, the Cleveland sidewalks. The stations, designed by Robert P. Clinic, and University Hospitals. Of the $200 million . Madison International Inc. of Cleveland, are modem invested in the project, $168.4 million for the transit and transparent, constructed of glass and stainless component was provided by the full funding grant steel, and designed to support the public realm by agreement (FFGA) with the FTA. The remaining $31.6 creating their own identity that reinforces the entire million went toward nontransit improvements, includ- corridor and transit rather than mimicking a certain ing sidewalks, utilities, and public art period or architectural style represented in the / 1 62 URBAN LAND MAY /JUNE 2012 Law Seminars International !Easements and CCRs 109/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker Sf 3 I '-'-li:.. 11, t tit, ....,.: , ,ii.:,, yy , a.... � ` -u ' ;� a yy'� �y Mfr ''„, , tea � • xy '1 I 14 - n ) 1 . " e'- plantings and seasonal _ ' VIVA & : , plantin enliven the medians • ' a . 2 f „ ,, n Y a 1 L where HeatthLi a t a tlons are ,.tt ,..- .,, .,._ may — y located alo re{be l l w )an ue. . shown before {bel and w -' ` " ` 3 after (left) Introduction of the b. ., ^r r , bus rapid transit service. neighborhoods the line traverses. They are well -lit a it t4 -, ... and are equipped with emergency blue -light phones , ,41- x1' a j and closed-circuit security cameras. 4 � s, . 1 K . x The HeatthLine operates 24 hours a day, seven ' ' . 4r^t 7 _' days a week. On weekdays, buses arrive at stations :, 1 , i 1 ' • 'ri" every ten minutes from early morning into the eve- .. , ,, Wing. During peak service periods, arrival frequency :, shrinks to every seven minutes. Such rigorous ser• "w ,,._ , ` vice levels make the HeatthLine a convenient and ' , 1. `1 x reliable transit option. "� 5- - The corridor accommodates multiple modes of transit by incorporating exclusive bike lanes and such as the station shelters, lighting, and pavement pedestrian - friendly sidewalks and street crossings. materials, are consistent along the entire corridor, The bus exclusive center lanes allow parking to be other elements — shelter size, light configurations, integrated back into the street, supporting efforts pavement pattems, and tree species —are distinct to to revitalize retail storefronts. Providing visual inter- Identify the different neighborhoods. est are seasonal plantings that provide splashes of Ridership has increased steadily over the years color in the medians; colorful and rhythmic pavement and now totals about 15,100 people per day. The striping in the sidewalks that provide human scale; b of riders are commuters, but we are experienc- and distinctive lighting elements —a custom light cre- ing a big uptick in midday ridership," says Schipper. ated for downtown medians; small bump tights in the In response, the RTA is extending the service's peak median outside of downtown that cast a low, wide hours to accommodate more riders. light that illuminates the center of the street; and The link between downtown and University Circle lighting of trees In wide, planted medians. Public art provided by the HeaithLine fortified the idea for the installations are integrated into street design along Cleveland Health -Tech Corridor, an initiative launched the corridor, including pavement pattems in the in 2010 that spans three miles (5 -8 km) and encom- crosswalks, stone patterns in the street, iron castings passes ten neighborhoods. Created by BioEnterprise, for tree grates, and a few stand -alone sculptures iliu- a biosciences business incubator, and Midtown urinated by light emitting diodes at night. Cleveland, an economic development corporation, The project required strategic partnerships among the Health -Tech Corridor seeks to attract and support diverse interests — public private, nonprofit, and businesses downtown, along Euclid, and in University neighborhood. To determine and satisfy the interests Circle. Baiju Shah, BioEnterprise president and CEO of various stakeholder groups, the RTA held about and a self described convert regarding the HeatthLine, 2,000 public meetings. One design solution that was persuaded by the "well- designed planning pro - engendered widespread community support was to cess that tied into a compelling business proposition." address the eight distinct neighborhoods in the cor- Today, Shah considers the HeatthLine a force spurring ridor individually. Though some design elements, developers to locate projects along the corridor. MAY /JUNE 2012 URBAN LAND 63 Law Seminars International I Easements and CCRs J 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6f: 4 ( i Among the features of One of the most visible ventures along Euclid is the medical and health are industries, is scheduled the Saco mittlon Euclid the $28 million MidTown Tech Park, which opened for completion in 2013. Corridor Transportation Protect are dedicated bike in summer 2o11. MidTown Tech Park has 128,000 The Healthline has not only created employment lanes, raised platforms square feet (11,900 sq m) of state -of -the -art incuba- opportunities, but also has changed the way people on the Healthline that tor space located on the former site of a used car think about transportation and job location, says allow same - level boarding dealership in Midtown, once one of the most down- Lillian Kuri, program director for architecture, urban of buses, and pedestrian amenities such as trodden neighborhoods along Euclid. Ravaged by design, and sustainable development at the Cleve - distinctive pavement civil rights protests in the 196os, the area had been land Foundation. a community foundation providing patterns at crosswalks. targely Ignored since. Substantial development in leadership advocacy on strategic initiatives for the Midtown so soon after completion of the Healthline city. "It has raised consciousness about making was unanticipated, Schipper says. "We wouldn't sure jobs are accessible to low - income residents," have expected this type of thing until five or so she says. Employers are strategically locating to years out," he says. be accessible by public transportation as a way of lumpStart, a nonprofit venture development attracting talent— something commonplace in major organization, was the first tenant of Midi Tech urban districts but often ignored in medium - sized, Park. "Midtown is increasingly becoming a hub for car- centric cities. entrepreneurship — particularly young biomedical The HealthUne has precipitated an economk companies —and we were excited to be contributing development strategy not just for the corridor, but also to that energy while adding to the growing vitality for the city. The project has brought about the partner - of Cleveland's urban core," says Ray Leach, lump- ships necessary for Cleveland to make a transition Start chief executive officer. "And now many of the from an industrial economy to a knowledge -based incubators, tech companies, higher - education insti- economy, building on the strength of education, tutions, and world -class health care are connected research, health care, and tourism. Euclid Avenue sup - not just in missions and interests, but by a physical ports the ventures that comprise this new economy, corridor developing around the Healthline." as well as housing, retail businesses, restaurants, and Cleveland HeartLab, which makes a biomarker- entertainment venues. The corridor is vibrant with pos- based heart test, is one of MidTown Tech Park's sibility as a place for people to live, work, and prosper, newest tenants. According to the Cleveland Plain and serves as an example for similar cities in the Dealer, the company has grown from eight to 8o United States and around the world. ti. employees over two years and likely would have left the area were it not for the new developments JASON HELLENDRUNG isa principal atSasakiAssociates, along Euclid. redpient of the 2012 American Planning Association National In addition, construction of about 5,100 housing Planning Firm Award. His practice involves reshaping cities through units has augmented the corridor's revitalization. public infrastndureimprovements—in particular, integration of New developments are also proliferating at either transit, redevelopment of urban waterfronts, and creation of public end of the HeatthLlne. Adjacent to University Circle, open space. He is on the UIJ Public Development and Infrastructure the Uptown district is home to the new $27 million C oundlandisamemtferof the ArriericanSociety oilandstape Museum of Contemporary Art. Downtown, the Cleve- Arthdeds U.S. Green 8u8dingfouridl ,AmericanPubficTrarmsg land Medical Mart & Convention Center, targeted to Association, and International Downtown Association. 64 URBAN LAND MAY /JUNE 2012 Law Seminars International I Easements and CCRs 1 09/19/12 in Portland, OR . Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6g: 1 urbanland utLorg _ W w w . http: //u rbanland.uli.org/ Articles /2012 /April /BraunsteinSpaces - We ate Private Money for Public Spaces In an era of shrinking govemment budgets, public /private partnerships are becoming an increasingly popular way —and often the only way—to improve, maintain, and operate successful public parks and spaces. Two examples of this model, one well - established and the other just getting off the ground, were presented at the ULI WashingtonReal Estate Trends conference in the nation's capital on April 17. Bryant Park , located in the heart of midtown Manhattan adjacent to the New York Public Library , is the countrys largest privately funded and operated park. A potter's field in the early 1800s , this 9.6 -acre (3.9 ha) space has been used as a public park since the 1840s. By the 1970s, it had become a dangerous haven for criminal activity and, with the moniker "Needle Park ," was a symbol of the city's decline. In 1980, a group of prominent New Yorkers, including members of the Rockefeller family, founded Bryant Park Restoration Corporation. One of its founders, Daniel Biederman , spoke to the ULI audience. Privately funded restoration began in 1988 and the park re- opened in 1992. Public funding ended in 1996, and the renamed Bryant Park Corporation now receives funding from business improvement district assessments, corporate sponsorships, event fees, restaurant rent, assessments, and other sources. "Privatization of Bryant Park has created value for surrounding real estate," Biederman told the group. "Adjacent buildings have increased their effective rents, and now developers are naming buildings after the park." Biederman noted that one marker of success is that more than half the park's users – counted twice daily by interns – are women. 'Women are much more discriminating users of public spaces than men," he said. "They notice details like smells and crumbs on tables. We know we are succeeding when we see the park full of women and strollers." Bryant Park has been able to take advantage of corporate sponsorships while maintaining strict control. "I often challenge people to find the corporate logos in the park," Biederman said. Logos for Coke, for example, are confined to the edges of the park's ping -pong tables and its ping -pong balls. Southwest Airlines operates a single beverage kiosk. John "Chip" Akridge , chairman of The John Akridge Companies , is chairman of the Trust for the National Mall , which is working as a private partner of the National Park Service to bring this dynamic to the nation's capital. Trust President Caroline Cunningham , addressed the Trends conference. Law Seminars International j Easements and CCRs 09/19/12 in Portland, OR Eugene L. Grant of Davis Wright Tremaine LLP Speaker 6g: 2 Photo by: Alex Boykov Cunningham pointed out that, with more than 24 million visitors, the National Mall has more visitors annually than Yosemite, Yellowstone, and the Grand Canyon national parks combined. Surveys have found that 97 percent of Americans know of the National Mall and about 70 percent are willing to donate to support it. The Mall has suffered, however, due to deferred maintenance, neglect, disrepair, deteriorating infrastructure, and lack of amenities. The Trust aims to obtain $350 million in private donations, about half of the amount needed to implement the National Mall Plan , which was signed in 2010 to provide a blueprint for restoration of the Mall and to guide its future over the next 50 years. A design competition has yielded 12 finalists proposing ideas for the renovation of Union Square at the foot of the U.S. Capitol, the Washington Monument grounds, and Constitution Gardens. All of the proposed solutions, Cunningham noted, include plans for restaurants, restrooms, and other amenities. The Trust also hopes to develop opportunities for virtual and experiential learning. C Law Seminars International I Easements and CCRs 1 09/19/12 in Portland, OR AIS -974 5. Workshop Meeting Meeting Date: 10/16/2012 Length (in minutes): 20 Minutes Agenda Title: Population and Housing Review Update Submitted By: Marissa Daniels, Community Development Item. Type: Update, Discussion, Direct Staff Meeting Type: Council Workshop Mtg. Information ISSUE Staff will brief council on the status of the Goal 10 Population and Housing Review. STAFF RECOMMENDATION / ACTION REQUEST No council action is requested. KEY FACTS AND INFORMATION SUMMARY The overall purpose of the Population and Housing Review is to assist the city in meeting community aspirations for growth, as outlined in the comprehensive plan, while complying with state housing goals and requirements. The project looks at population projections and demographic trends along with the amount and location of available land. The end result is a list of potential strategies to meet the city's future demand for housing that implements the city's aspirations and state requirements. The project will also provide a qualitative analysis of trends and market preferences in regards to an aging population and potential recovery from the recent housing downturn. Strategies that respond to the opportunities presented by potential high capacity transit, redevelopment of downtown Tigard, and the future development of the recently annexed River Terrace will be included. Staff will brief council on the results of initial work tasks, including results of the data review, compliance with the Metropolitan Housing Rule, and the policy and Development Code evaluation. For detailed information about each work task, consultant reports are available online at www.tigard-or.gov/housing. Tigard has been awarded a Periodic Review grant by the Department of Land Conservation and Development (DLCD) to complete this Review. Every five to seven years, cities and counties are required to evaluate their comprehensive plans and land use regulations through a process called "Periodic Review" (ORS 197.628 -644 and OAR 660, Division 25). This process ensures Tigard's Comprehensive Plan and land use regulations are consistent with Oregon law and continue to provide for the growth management and development needs of the community. Tigard has been engaged in a periodic review process for two years, and the Population and Housing Review is part of this process. OTHER ALTERNATIVES N/A COUNCIL GOALS, POLICIES, APPROVED MASTER PLANS DATES OF PREVIOUS COUNCIL CONSIDERATION N/A Attachments PowerPoint Slides AgendaQuick©2005 - 2012 Destiny Software Inc., All Rights Reserved 5,7017 111( MR City ofTigard Respect and Care 1 Do the Right Thing 1 Get it Done Population and Housing Review October 16, 2012 TIGARD Cite ofTigard Task Due 1. Data Review and Report - -71 2. Metropolitan Housing Rule Review and - - compliance with OAR 660 -07 -0000 3. Policy Evaluation and Report Draft Multifamily housing 4. Development Code Evaluation and Draft Report 5. Housing Strategy Report December 6. Draft Goal 10 Population and Housing January - Review Report 7. Final Report March Single family housing www.tigard -o r.gov /housing - f City of Tigard a t t �� Tasks 1 and 2 • Collect population and housing data • Identify recent and future housing trends • Determine types of housing likely to be affordable to projected households • Population and housing projections • Refine buildable lands inventory • Ensure compliance with state statutes related to housing www.tigard - or.gov /housing City of Tigard Recent and Future Housing Trends • Migration to urban environments , t • Diminishing household ti sizes 1. 11 • Baby Boom generation LI — transitions • Millennial generation preferences • Immigration ——. --•"°' • Workforce housing Townhomes will likely represent a larger share of for -sale starter homes. www t i g a r d -o r. gov/housing City of Tigard Population and Total Housing Units H ousing Single Single Family 3- or 4- 5+ Units Mobile Total % of P rojections Family Attached Duplex plex MFR Home Units Units Total 3,577 1,279 145 393 1,154 0 6,547 100% • Results show a need for %age 54.6% 19.5% 2.2% 6.0% 17.6% 0% 100% over 6,547 new housing units by 2030 Sources: PSU population Research Center, Claritas, Census, Johnson Reid • Of the new units needed, 78% are projected to be Projected future demand for NEW housing units (2032) ownership units • The largest share is projected to be single family detached homes www.tigard-or.gov/housing City of Tigard '- Buildable Land MOM. Yea lovani, Oaf eau., Inventory L 4."--) 0 GM,.r, ,<„� , uaa. 01 ay. .. •- ntrr.,., • The city's BLI was used to ww•$r determine the location of """" """' developable land within g - - I iagb Tigard. ,, • This information was analyzed to determine j —." - - i E the city's capacity for L----m new housing units. ...a .J.,5 ` ___,, ,,__ . . ,,,„, 7 - Buildable land inventory by zoning designation www.tigard-or.gov/housing City ofTigard Need for Future TOTAL NEW UNITS NEEDED (2032) Single Family Multifamily Total Units Capacity of Residential Vacant Lands Units Per Net Designation 4,856 1,692 6,547 (In Units) Acre Land R -1 3 0 3 3 1.3 R -2 2 0 2 2 2.2 • Very good news: R -3.5 100 0 100 197 8.7 Each comparison is right on target for R -4.5 867 0 867 1,302 8.7 meeting the need R-7 628 0 628 628 8.7 with the land R -12 525 0 525 525 14.3 available. R -25 146 1,094 1,240 1,240 29.4 MUR -1 0 191 191 191 50.0 MUR -2 0 60 60 60 50.0 Area 63 700 0 700 700 6.7 Area 64 1,785 347 2,132 2,132 13.0 Totals/ 4,756 1,691 6,447 6,979 11.6 Averages: www.tigard-orgoy/housing City ofTigard Tasks 3 and 4 • Review Comprehensive Plan to ensure consistency with Tasks 1 and 2 and relevant state or federal housing regulations • Review the Community Development Code to ensure consistency with Tasks 1 and 2, the Comprehensive Plan, and relevant state or federal housing regulations www.tigard-or goy/housing City of Tig, Current and Forecasted t Housing Needs °� , ti Y Y _ • The City's y Comprehensive Plan 7 ;11.: Y t �, • does a good job of • addressing the identified need for:' t "►'�' • _ Affordable housing, and - fir F .` _ J _ A variety of housing types • Results show there is sufficient capacity for new housing There is a need for future housing in a variety of price ranges and housing types. www.tigard-or.gov/housing City of Tigard Policy and Code Metropolitan Housing Rule (OAR 660 -007) Compliance with Key federal and state Section Requirement Result -0030 To provide the opportunity for at Under current zoning and planning housing least 50% of new residential units there is an opportunity for greater to be attached single family than 50% to be attached or regulations housing or multifamily housing multifamily units (76 %). -0035 Target densities for jurisdictions, Under current planning and zoning • Fair Housing Act in Tigard it is 10 or more dwelling Tigard provides for an overall • Economic Opportunities units per net buildable acre residential density of new Analysis construction of 11.6 units per acre • Urban Growth The city is meeting key requirements for housing. Boundaries and Needed housing within Boundaries • Metropolitan Housing Rule www.tigard-or.gov/housing s,J yy rs �' S " : , y ' • City of Tigard ' Review of Development Code Types of Questions to be • ° addressed: i. • Do districts allow for a variety of housing types, • , . • ~''1 m R" ! including new housing i types such as cottage .. housing or live /work s , '" r. •+ ' units? • • Should standards be revised to help meet density and affordability goals? • Should the city update location, size and setback standards for Accessory Dwelling Units? www.tigard- or.gov /housing City of Tigard Future Work • Housing Strategy Report • Goal 10 Population and Housing Report • Planning Commission and City Council Review www.tigard-or.gov/housing City of Tigard Questions? ` \_,, ,, 4 . yam , ' ! 4 . , II flibBh_ -......._ ,...r*,.,. ,_ , -------- , :••,-„,:,s----,\_,,,,\-. , .._....., . `,' www.tigard-or.gov/housing