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03/12/2014 - Packet"Completeness 9 Review for Boards, Commissions and Committee Records CITY OF TIGARD CCAC-City Center advisory Commission Name of Board,Commission or Committee bfan,h 12,2014 Date of Meeting Doreen Laughlin-for Chris Wiley Print Name Signature 5/8/14 Date City of Tigard City Center Advisory Commission Agenda MEETING DATE: Wednesday, March 12, 2014— 6:30 — 8:30 p.m. MEETING LOCATION: Red Rock Creek Conference Room 13125 SW Hall Blvd.,Tigard OR 97223 1. Welcome and Introductions.......................................................................................................6:30 — 6:40 2. Review / Approve February Minutes .......................................................................................6:40— 6:45 3. Non-Agenda Items/ Public Comment.....................................................................................6:45 — 6:50 4. Urban Renewal 101......................................................................................................................6:50 — 7:50 Presentation on Oregon Urban Renewal law and review of Ti gard's Urban Renewal Plan (Elaine Howard- Urban Renewal advisor) 5. Vertical Housing Development Zone.......................................................................................7:50 — 8:15 Action item:Review information and consider making a recommendation to the CCDA Board and forward questions for further research (Sean Farrelly) 6. Main Street Green Street.............................................................................................................8:15— 8:20 Update (Sean Farrelly) 7. Liaison Reports...............................................................................................................................8:20 — 8:30 8. Adjourn............................................................................................................................................8:30 p.m. Upcoming meetings of note: March 19,Tigard Downtown Alliance meeting,4:30-6:00 PM (location TBA) April 1, City Center Development Agency Board meeting,Red Rock Creek Conference Room, 6:30 PM April 9, Regular CCAC Meeting,Library Community Room,5:30 PM (early start and new location) Note:Weekly Main Street Green Street construction update meetings at Symposium Coffee, 7-8:00 AM CITY CENTER ADVISORY COMMISSION AGENDA— March 12, 2014 City of Tigard 1 13125 SW Hall Blvd.,Tigard,OR 97223 1 503-639-4171 1 www.tigard-or.gov I Page 1 of 1 Eel City Center Advisory Commission Meeting Minutes Date of Meeting: Wednesday, March 12, 2014 Location: Red Rock Creek Conference Room Called to order by: Chair Tom Murphy Time Started: 6:35 pm Time Ended: 8:50 pm Commissioners Present:. Thomas Murphy, Deanie Bush,Linli Pao, Sherry Devaney,Laura Fisher, Carine Arendes, Hank March, Richard Shavey,Lynn Scro (alternate) Commissioners Absent: Paul Miller Others Present: Guest presenter Urban Renewal Advisor Elaine Howard, Elise Shearer from TTAC and Mike Stevenson from TDA. Staff Present: Downtown Redevelopment Project Manager Sean Farrelly and Community Planning Senior Administrative Specialist Chris Wiley. AGENDA ITEM #1: Welcome and Introductions Tom opened the meeting. Newly appointed members Hank March, Richard Shavey, and Lynn Scroggin were attending their first meeting since being appointed so there was a round of introductions. Chris recorded the roll call. AGENDA ITEM #2: Review / Approve Minutes The February 12,2014 CCAC Minutes were approved as amended. Note: Although the February minutes said the Scoffins intersection was to be continued at the March meeting,it was decided to move the topic to a meeting sometime later this year. AGENDA ITEM #3: Non-Agenda Items / Public Comment AGENDA ITEM #4: Urban Renewal 101 (Attachment 1) Urban Renewal Advisor Elaine Howard gave her presentation on Oregon Urban Renewal law followed by a review of Tigard's Urban Renewal Plan. AGENDA ITEM #5: Vertical Housing Development Zone (Attachment 2) Action item:Ret ew information and consider making a recommendation to the CODA Board and forward questions for further research (Sean Farrelly) The commission members are in favor of the proposal however there were several questions about process that staff will need to follow up on. CCAC Meeting Minutes for Wednesday, March 12,2014 Page 1 oft AGENDA ITEM #6: Main Street Green Street Update (Sean Farrelly) A. Sean gave the commission an update on the flaggers' activities. The commission said word needs to get out to the public that construction stops at 3 p.m. and there is no construction activity on weekends so access to downtown businesses is easier during those times. B. At the request of the commission, Sean will ask project manager Kim McMillan if she could vary the days and/or times she meets with downtown merchants so there are more opportunities for downtown business owners to make the meetings. AGENDA ITEM #7: Liaison Reports A. TTAC - Elise Shearer. The April meeting is cancelled. TTAC's next meeting is scheduled for May 7. The focus at their most recent meeting was on the CIP and the budget. B. PRAB -Sean. Community Development Director Kenny Asher spoke to them this week and updated the members on the Parks Bond funds set aside for the downtown area. C. CODA —Carine. CCDA also liked the strolling street proposal that CCAC looked at during the February meeting. AGENDA ITEM #8: Other Comments A. The next CCAC agenda will look at goal setting. B. Sean — next month's meeting starts early and will meet at the library. AGENDA ITEM #9: Adjourn. The meeting adjourned at 8:50 p.m. (/ t C.L. Wiley, CCAC Rec.49 g Secretary ATTEST: / Thomas J. Murphy Chair Recordin,g Secreta 's Note:To reg�est copies of the attaehme th minzates,please emaik doieen@ tigard-or.gov CCAC Meeting Minutes for Wednesday,March 12,2014 Page 2 of 2 Urban Renewal Best Practices ---------------------------------------------------------------------- 0 ----------------------------------------------------------------------------------------------------------- C) - CD (D CD IQ Elaine Howard Consulting, LLC What is Urban Renewal? ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Program to address blighting influences in specifically designated areas • Authorized through Federal 1949 Housing Act, State Statute in 1951, authorized for cities in 1957 • Used throughout Oregon • Provides Financing Mechanism to Implement City Plans: Uses increases in Property Taxes to Fund Projects in Area Elaine Howard Consulting, LLC What is the Role of an Advisory Committee? ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ Role of CCAC: • Making recommendations on policy, budget, and implementation of urban renewal projects identified within the Urban Renewal Plan and/or the annually adopted Downtown Work Program to the City Center Development Agency Board for consideration, deliberation and action. • Making an annual report to the CCDA Board including a summary of key activities and proceedings and any specific suggestions or recommendations which the CCAC believes would assist its mission or the overall goals for the Downtown. • Making recommendations to the CCDA Board for amendments to the Plan. • Performing other duties as assigned by the CCDA Board Role of Board of CCDA (Council): makes decisions on urban renewal implementation, policy, and budget Cities with Urban Renewal "gg-joilksgin f ASTORIA V A.RRENTON RA NIER INA SEASIDE PORTLAND BOAREWAN OMILT4N.FREEti1I4i€R r HOOD RIVER HERM15TON .6RI6AL6°` 0 OpENDLETON Cl THE DALLES —LLAFfiOOK H9 RRIVERG;71JNiY LA GRANDE 0 LINCOLN CITY so WILSONVILLE 0 EIEPCIE BAY SALEM NEWPORT MADRAS ALBANY 0 LEBANON � WA G�JL�E�d WALDPORT� ?HILONIATH 0 NQHTHF"4AFN43 YACHATS R6DM.DFe6 PORTLAND HRRRISBURO SISTERS � TROIilTflAL;E 0 "OBLRG l �} REA�rER T(}N ,GRESHAM FLORENCE' NETA0 &PRINGFIELd BEND } L4KE E0 O ALJ TIGAR:D[ SANDY EUGENE OR sH€Rw4Co-bo ✓ C� }GLADSTONE Id REEOSRf7RT 0 CARLTi]7� OREWN CITY WIL �ONVILLE� ANBY EST CADA NORTH BEND 0 U IAA's Per COOS 13AY MCMINNVILLE O MOLLALA Municipality BANDCN 0ROSEBi1R6 WOODBURN� � 0 COQUILLE WINSTON HEIZER SILHERTON �. 0 0 DALLAS 0SALEM [y`y INDEPENDENCE0 GOLD BEACH '�L�` MONMOUTH h1EDFOR6 JALK59N�'1 L L E .� PHQHNIx KLAMATH FALLS 0 -- BROOKINGS TALENT C& NV �18 V If L]c��°ilc�tr it �Jrkan :. �' Renewal Disinct City of Tigard � � i�.� � .I . � *�` ILI Adopted y 2oo6 193.71 acres at the time adopted, this was2.6/ of total City - acreage Zoned MU- CBD lop A5 IMUebsn B-bundsry _, Ta,Kloz�p�ndarV _ b l _ �� � -•, ii What is Blight? ------------------------------------------------------------------------------------------------------------ 0 ---------------------------------------------------------------------------- ----- • Defined by the State Statute ORS 457 • Generally covers: Underdevelopment or underutilization of property Poor condition of buildings Inadequacy of infrastructure including streets and utilities Elaine Howard Con su ing, LLU State Limitations on Urban Renewal ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Population under 50,000 25% of Assessed Value of Property in City -- at adoption was 1.47 of total AV 25% of Acreage of City - - Tigard's Plan is 2.6% of acreage Tigard Population by PSU Pop Center estimates 49,135 July 1, 2013 estimate • Population over 50,000 15% of Assessed Value of Property in City 15% of Acreage of City • Existing Plan limitations: Can not be increased in size by more than 20% of original Plan acreage Maximum Indebtedness (MI) can not increase by more than 20% of original MI, indexing Elaine Howard Consulting, LLC Maximum Indebtedness ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ Maximum Indebtedness of Tigard Plan is $ 22,000,000 over 20 years (approx $ i M already collected in TIF) Total amount to spend on administration, projects and programs in an urban renewal area. Elaine Howard Consulting, LLC How Does Financing in Urban Renewal Work? ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • An area is designated as an urban renewal area • The tax assessed value of properties within the area is frozen • Taxes from that "frozen base" go to all taxing jurisdictions • Increases in taxes over the "frozen base" go to the urban renewal agency for use in the Area Elaine Howard Consulting, LLC Projected TIF Revenues $7,000,000 $6,000,000 $5,000,000 $4,000,000 Taxes TIF Revenue Going to Taxing Districts $3,000,000 ' Post-URA Tax Revenue $2,000,000 TIF Revenue 1-1T $1,000,000 Frozen Tax Base $0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Years After Formation of URA ■Post-URA Tax Revenue Reveune Sharing ■TIF Revenue Frozen Tax Base Elaine Howard Consulting, LLC Scenario Showing TIF Revenues and Debt Service j; AOL Q ,s W-P 2012-13 22- 3 2032- 2042-43 Dek SerVrice TIF Elaine Howard Consulting, LLC How Impacts are Calculated by Assessor ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ District Name Perm Rates 2012 jjff�W 2ni 1 9 9013 W/O Urban Renewal W/ Urban Renewal Property Value $100,000 $103,000 $103,000 Washington County 2.2484 $224.84 $231.59 $224.84 Metro 0.0966 $9.66 $9.95 $9.66 Port of Portland 0.0701 $7.01 $7.22 $7.01 Portland Community College 0.2828 $28.28 $29.13 $28.28 NW Regional ESD 0.1538 $15.38 $15.84 $15.38 Tigard/Tualatin School District 4.9892 $498.92 $513.89 $498.92 TV Fire & Rescue 1.5252 $152.52 $157.10 $152.52 City of Tigard 2.5131 $251.31 $258.85 $251.31 Aquatic District 0.09 $9.00 $9.27 $9.00 City of Tigard - Phase In 1.6838 $168.38 $173.43 $168.38 City of Tigard - Phase In 2 0.8293 $82.93 $85.42 $82.93 Urban Renewal $0.00 $0.00 $43.45 Total 14.4823 $1,448.23 $1,491.68 $1,491.68 Elaine Howard Consulting, LLC Property Tax Bills ----------------------------------------------------------------------------------------------------------- 0 ------------------------------------------------------------------------------------------------------------ • Add all increases in Assessed Value in Area • Distribute Amount to all Property Tax Bills in City • Does Not Increase Tax Bills (unless you have pre 2001 bonds) , Just Shows the Division of Taxes • Bonds: You are a Reduced Rate Plan, no impact on bonds or local option levies issued after 2ooi.Tigard UR impacts 4 pre2001 bonds. (Wash Co, Metro, PCC, School District, approx. $ 17K in 203-14) • Table 4e by Assessor shows Urban Renewal Impacts Elaine Howard Consulting, LLC PropertyTax Bills ---------------------------------------------------------------------------------- 0 ------------------------------------------------------------------------------------------------------------ District Name 2013 2013 W/O Urban Renewal W/ Urban Renewal Property Value $103,000 $103,000 Washington County $231.59 $224.84 Metro $9.95 $9.66 Port of Portland $7.22 $7.01 Portland Community College $29.13 $28.28 NW Regional ESD $15.84 $15.38 Tigard/Tualatin School District $513.89 $498.92 TV Fire & Rescue $157.10 $152.52 City of Tigard $258.85 $251.31 Aquatic District $9.27 $9.00 City of Tigard - Phase In $173.43 $168.38 City of Tigard - Phase In 2 $85.42 $82.93 Urban Renewal $0.00 $43.45 Total $1,491.68 $1,491.68 Elaine Howard Consulting, LLC Impacts on Taxing Jurisdictions ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Continue Receiving Tates on Frozen Base • Forego taxes on growth in Area • "But For Urban Renewal" • Increased Tax Revenues After UR Elaine Howard Consulting, LLC 2009 Legislation ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Revenue Sharing Triggers lo% and 12.5% of MI New plans and Substantial Amendments after 2009 • Limits on MI Increases: Indexing • Concurrence • Plans which have been amended since 2009 • Ability to Under-levy Elaine Howard Consulting, LLC What Types of Projects are Typically Completed? ------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------ e Infrastructure: Streets and Utilities eStreetseape *Catalyze development *Facade grants oParks, plazas Elaine Howard Consulting, LLC Parks and Plazas : Place Making ------------------------------------------------------------------------------------------------------------ • . 5 Ip map Elaine � i � • M.. ,--ems z� _- R -ter • nz Howard Consulting, LLC Fa / Grants ------------------------------------------------------------------------------------------------------------ • Nov 14 1 Elaine Howard r � FA EEK a • Redevelopment/Infrastructure: The Dalles Brewery Grade ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ Established in 1990 1998 Frozen Base $24,866,020 M M Area is 7.31% of City Acreage 3.41% of City Assessed Value Present AV k ». S Y ri I F I� Increased MI in 2009 to $29,125,583 from $14M _ Elaine Howard Consulting, LLC "First and A" Lake Oswego ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ h -1 T Elaine Howard Consulting, LLC Redevelopment: Lake View • ------------------------------------------------------------------------------------------------------------ • ILElaine Howard Consulting, • �r Agai- ite; goo Ar . •:,r "� . d aM 4 �l _ y �I 71� � s l � ------------------------------------------------------- Consulting, Elaine Howard 1St Street Lake Oswego Elaine Howard Cansu- • • �R y F Sherwood: New Streetscape ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ Area Established 2000 MI $45J33469 Increased in2012in Substantial Amendment Original Frozen Base $62,419,260 2011-12 AV: $290,643,763 465% growth City 217% Elaine Howard Consulting, LLC Site of Sherwood City Hall ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ MOP Elaine Howard Consulting, LLC p � - e From Old Warehouse to New CityHa & Library Elaine Howard Consulting, LLC Public Square Sherwood ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ u3 Elaine Howard Consulting, LLC apt E- -� l�+.�� �- F._ .ate, �' - --•'� �r� - r� r 1130 Million Private Investment t — w y r sl z l r 4 � r ,,� [[Or•0[ex..Cx i[�.. Q 'UpE Sh SHERWt7OD OLD CANNERY SITE THE CANNERY sHcros-o3.0m.xaos � � _____• •__ __: :_• Cannery Shops / Sherwood Community Center — The Old Machine Shop The URA has contracted with Capstone Partners, LLC to convert the Old Machine Shop into Retail Space and a Community Center.. RAILROAD TRACKS F WEST X?.r PLA ► EE.GG ME PE4ME 1. 5 m = MACHINE .. �—� 77, C4 AJIMa A STREET WL?#ELS. -. - —J_.Fla 1 „tom um REaEh6ilAL l 1 �. SHER%-V OD OLD CANNERY SITE 5,•. ,t H 1z. - ,:. B C.A P~ Fa.'ue.4.... SHERWOOD CANNERY SQUARE PUD PLAN (PlannedThis PUD Unit Development) approved 1 1 Construction 1 • is complete. Tigard Projects in Plan ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Street Improvements • Streetscape Improvements • Bike/Ped Facilities • Parks • Public Spaces • Public Facilities • Planning and Development Assistance (Loan Programs, Technical Assistance, Facade) • Property Acquisition Ballot Measure 34-207 ------------------------------------------------------------------------------------------------------------ 0 ---------------------------------------------------------------------------------------------------------- • Charter Amendment clarified the Agency's ability to bond • Approved with 75°/a of vote in November, 2013 What are permissible uses of UR $ $ in Tigard . . Are we more restrictive ? --------------------------------------------------------------------------------- -------- ------------------------------------------------------------------------------------------ ORS 457 . 170 - 180 Your plan is not more restrictive , allows all activities . What is involved in extending duration of Plan ----------------------------------------------------------------------------------------- O - ---------------------------------------------------------------------------------------- 0 Duration of plan : no new indebtedness after loth anniversary of plan . Effective date is date county certified election results . Need council app roved amendment to plan to change this provision . What happens to Tax Increment at end of UR Area? ------------------------------------------------------------------------------------------ 0 -------------------------------------------------------------------------- v v May still collect to pay7fff debt . What is Compression? ----------------------------------------------------------------------------------------- O ----------------------------------------------------------------------------------------- Compression is not an issue to Tigard Urban Renewal Other issues with Tigard UR Plan? ----------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------- O - Amendments are different . Some items require a vote . Maximum indebtedness is low . city Population Albany 50,720 56,000,000 Beaverton ` 91,935 150,000,000 Canby 15,910 51,150,000 Gresham 106,180 92,000,000 Keizer 36,795 45,890,384 Lake Oswego Downtown 36,990 58,014,000 McMinnville 32,510 30,000,000 Oregon City 33,390 130,000,000 Pendleton 16,780 331500,000 Redmond 26,590 27,136,719 120,717,081 Roseburg 22,275 771250,133 Sherwood 18,575 35,347,600 45,133,469 Springfield Downtown 59,990 43,010,000 Springfield Glenwood 59,990 32,860,000 Tigard 49,135 22,000,000 [Tualatin Leveton 26,510 36,424,338 Tualatin Central 26,510 27,707,384 Wilsonville Year 2000 21,550 92,687,423 Wilsonville West Side 21,550 40,000,000 Woodburn 24,330 29,300,000 city Population • • • • • Beaverton 91,935 150,000,000 Oregon City 33,390 130,000,000 Wilsonville Year 2000 21,550 92,687,423 Gresham 106,180 92,000,000 Roseburg 22,275 77,250,133 Lake Oswego Downtown 36,990 58,014,000 93,980,000 Albany 50,720 56,000,000 Canby 15,910 51,150,000 Keizer 36,795 45,890,384 Springfield Downtown 59,990 431010,000 Wilsonville West Side 21,550 40,000,000 Tualatin Leveton 26,510 36,424,338 Sherwood 18,575 35,347,600 45,133,469 Pendleton 16,780 33,500,000 Springfield Glenwood 59,990 32,860,000 McMinnville 32,510 30,000,000 Woodburn 24,330 29,300,000 Tualatin Central 26,510 27,707,384 Redmond 26,590 27,136,719 120,717,081 Tigard 49,135 22,000,000 Minor Amendments ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ Minor Amendments are amendments that are neither Substantial Amendments nor Council-Approved amendments. Minor amendments require approval by the Agency by resolution. Council Approved Amendments ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Council-Approved Amendments consist solely of the following amendments : • Material changes to the goals and objectives of the Plan. • Addition or expansion of a project that adds a cost in 2005 dollars of more than $500,000 and is materially different from projects previously authorized in the Plan. • Extending the duration of the Plan. Substantial Amendments ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ • Amendments that increase the maximum indebtedness of the Plan and add land to the urban renewal area that totals more than i% of the total plan area are classified as substantial amendments. i. Substantial Amendments Requiring Voter Approval Substantial Amendments Requiring Voter Approval consist of increasing the maximum amount of indebtedness. Such amendments shall require City Council approval by non-emergency ordinance and an affirmative vote when referred to Tigard voters for approval. Substantial amendments not requiring voter approval ------------------------------------------------------------------------------------------------------------ 0 ---------------------------------------------------------------------------------------------------------- 2. Substantial Amendments Not Requiring Voter Approval Substantial Amendments Not Requiring Voter Approval consist of adding land to the urban renewal area that totals not more than i% of the original plan area. Question from City Council ------------------------------------------------------------------------------------------------------------ 0 ------------------------------------------------------------------------------------------------------------ "What is involved in adding 500 or more acres of land to our area and increasing the limit of our debt by double?" State law allows a district to grow by only 20% of your original. Your original district was 193. 1 acres. You may add up to 38.74 acres. There area also statutory debt limitations: growth by 20% of initial MI with indexing unless concurrence by 75% of taxing jurisdictions. MI is $22,000,000, allowable increase w/o concurrence: $5,573,788 SUBSTANTIAL AMENDMENT for either What Happens After Urban Renewal? ------------------------------------------------------------------------------------------------------------ 0 ----------------------=-=---------------=-=- ---.---.-----=-=- ---------------------------------------------------- • Increased value of the Area is returned to the tax rolls and all taxing jurisdictions gain the benefit of increased taxes • Area of the City has been improved, better serving the citizens of the community Tax Base Through Life of URA $300,000,000 $276m $245m $250,000,000 $138m $105 _ $200,000,000 $77m $150,000,000 $35m $ 6m$912 TMEW POP 3 $100,000,000 $50,000,000 $o 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Years after Formation of URA Frozen Base Incremental Growth New Taxable Value after URA Expiration Elaine Howard Consulting, LLC ELAINE HOWARD AM CONSULTING, LLC Elaine Howard James Vanden Bos Office: 503.635.2783 Cell: 503.975.3147 1 Fax: 503.675.1161 elaine@elainehowardconsulting.com 705 Terrace Drive Lake Oswego, Oregon 97034 What is compression? --------------------------------------------------------------------------------------------- Assessed Real Value Market I Value Times tax Times rate per maximum $1,000 AV allowable rate I Equals Equals tax maximum extended allowable tax Property owner pays lesser of two ------------------------------------------------------------------------------------------------- If tax extended is greater than the maximum allowable amount, the difference is compression loss and is not collected. ECONorthwest Fri.^.NOMI - =1W-12F , Plat NIN III LU and out of compression? $900,000 $800.000 ---------------------------------------------- $700,000 $600.000 3 $ 00,000 k $400.000 a C $300.000 � $200.000 $100,000 $0 2010 2014 2018 2022 2026 200 —Assessed Value —Real Market Value Compression occurs when a property' s AV/RMV ratio falls below a level determined by the area' s tax rate E ONorthw st Pf 2NOMIC. =INAN^F . PI ANNING Once a property is in compression, what is reduced? Compression losses are inflict ----- --------------------------------------------------------------------- upon existing levies categoricoy A c r,Fs ops Each category is composed of multiple individual levies. Local option levies are reduced first. Each individual local option levy is reduced by the same percentage �. C, until all compression losses are accounted for. erm nent If compression losses exceed taxes to Ra tes local options, the process continues with permanent rates. Each individual rate is reduced by the same percentage until all compression losses are accounted for. GO Bonds are not affected by compression. ECONorthwest Fr:�rar,riir.; iNAWr .F . Pl.;raNIMr; affect urban renewal? • Pry ert -ta-x- to--ua n e n ewa I--is-co-unted-as- .------------------------------------------------ general government permanent levy rates for the sake of compression. When compression occurs beyond the local option stage for general government levies urban renewal revenue falls. Local Options ----------- -------- �`�`'' �'�y Permanen t Rates ---------------------'--------' E Northwest GO Bonds Fc.^.rar,riir. • =iNAWa F . PIANNIW; affect urban renewal? The Assessor's Offic e mines each year how much taxis to-be ext nd -for the TTRA Vid-TIF �___________________________________________________________ • Instead of collecting all UR money from properties within the URA, the Assessor sets a city-wide urban renewal rate. • In short, whenever property in the city is in compression, the URA loses revenue. City Limits URA ECONo west F! r�rar.iir.,; 1NAWF . ai. R ELAINE HOWARD m CONSULTI NG,LLC COMPRESSION Compression is an Oregon tax system issue that that reduces the amount of taxes that can be collected in a given year if the collection amount is going to exceed the pre-set maximum established by Measure 5 and adjusted by Measure 50.The calculations,causes,and effects of compression are extremely complicated.If real market values and assessed values are converging,urban renewal can cause increases in compression.However,urban renewal can also be a tool to help facilitate growth that ultimately reduces compression.Urban renewal can also decrease compression in the schools category when school taxes are re-classified as general government taxes under urban renewal. The recession of the 2000's,by decreasing the real market value of many properties,has caused compression losses to increase throughout Oregon.Compression occurs when tax rates exceed tax limitations and assessed values and real market values inch closer together. Measure 5 as adjusted by Measure 50 imposed tax rate limits of$10 per$1,000 of real market value for General Government categories and$5 per$1,000 for Education categories.Urban Renewal is calculated in the General Government category.This classification reallocates the Education portion of taxes within an urban renewal district from Education and moves it into the General Government category.Urban renewal taxes divided from levies to repay general obligation bonds that are exempt from Measure 5 are also included in the General Government category.This has the effect of increasing the General Government tax rate,but reducing the Education and Exempt tax rate. The Measure 5 tax rate limits are exceeded in many areas in the state,but this did not cause significant reductions in taxes collected(compression)until the difference between assessed values and real market values decreased.Compression occurs first on local option levies,then on permanent rate levies.While compression is a concern for all taxing jurisdictions,it is especially a concern for special districts that have local option levies,as those are compressed before any other levies are compressed. An example of how compression works is shown below.In the first scenario a house with a real market value of$200,000 and assessed value of$190,000 experiences compression while a house with a real market value of$250,000 and assessed value of$190,000 does not experience compression. 1. Scenario I Assessed Value(AV)$190,000 Taxes levied Real Market Value(RMV)$200,000 Actual tax rates: General Government taxes($12.50 per$1,000 of AV) $2,375 Education taxes($6.50 per$1,000 of AV) $1,235 Tax rate limits: General Government tax limit($10 per$1,000 of RMV) $2,000 Education tax limit($5 per$1,000 of RM[) $1,000 Compression General Government(M-5 loss) $(375) Compression Education (M-5 loss) $(235) In this scenario,both the general government and education taxes have to be compressed.In this situation,taxing jurisdictions are scheduled to collect$610($375+$235)over the established taxation limit.To ensure the limit is not exceeded,the actual taxes collected are compressed down to the maximum$2,000 and$1,000 limits,and the taxing jurisdictions lose out on$610 of revenue. Copyright Elaine Howard Consulting,LLC 2012 www.elainehowardconsulting.com ELAINE HOWARD m CONSULTI NG,LLC If the real market value is higher(i.e.assessed value is a lower percentage of the real market value),compression is less likely to occur.In the scenario below,compression does not occur as the real market value of$250,000 allows enough capacity to levy the full amount of the taxes for tax rates in excess of the Measure 5 limits.This example is still based on a $190,000 assessed value. 2. Scenario II Assessed Value(AV)$190,000 Taxes levied Real Market Value(RMV)$250,000 Actual tax rates: General Government taxes($12.50 per$1,000 of AV) $2,375 Education taxes($6.50 per$1,000 of AV) $1,235 Tax rate limits General Government tax limit($10 per$1,000 of RMT) $2,500 Education tax limit($5 per$1,000 of RM[) $1,250 Compression General Government(M-5 loss) $0 Compression Education(M-5 loss) $0 As shown above,there are two variables to watch when considering compression,the tax rates and the relationship of the RMV to AV of properties. The effect of the recession can be seen in the two scenarios above.The property in these scenarios provides$3,610 to local taxing jurisdictions when its real market value is$250,000,however,when that value drops to$200,000(similar to what many properties have done throughout the recession),the taxes on the property are compressed down to$3,000,and the taxing jurisdictions are faced with declining revenues.Also,new local option levies can exacerbate the situation when they are passed,as they increase the tax rates,but not the tax limits. The only ways to reduce compression are to reduce tax rates,to increase the real market values of properties,or raise the taxing limitations,that would take a state-wide vote.However,there are not that many plan areas around the state are within areas where the total general government tax rate is under$10 and therefore there is no compression at all. According to data from the Department of Revenue,of the 102 plan areas that received division of tax revenue in 2011-12, 22 suffered no compression loss and another 31 had compression losses of under$100.For the special levies,out of a state-wide total of 22,10 had no loss and 5 had losses of under$100.According to Tom Linhares,Executive Director of the Multnomah County Tax Supervising Commission,The City of Portland has 92%of all of the compression losses statewide. Urban renewal can help eliminate or offset the effects of compression in two ways,by raising the real market values of properties and by encouraging new development.Increasing real market values are dependent on a strong real estate market,which typically follows a strong economy.New development is an obvious benefit to taxing jurisdictions as it provides another source upon which to levy taxes.New development is also beneficial to school districts that are using the construction excise tax.It is the desire of many special districts and urban renewal agencies that the impact of urban renewal help facilitate growth in the community that will increase its economic vitality and both increase the real market values of properties and add new development to the tax rolls. elainegelainehowardconsulting.com cell:503.975.3147 office:503.635.2783 Copyright Elaine Howard Consulting,LLC 2012 www.elainehowardconsulting.com w' k TigardCityOf Respect and Care Do the Right Thing Get it Done D D oW N 3 • ° Te-+ Verti* cal ousing NUl N D n Develoment one LA rD rD P N - 0 K (An introduct *ion) rD r+ � rD Ul City Center Advisory Commission March 12, 2014 City of Tigard Overview / Designated by the State Oregon Housing & Community Services Department (OHCS). State enabling legislation allows municipalities to create a special district. Encourages investment and rehabilitation for: • Mixed-Use Development. * Residential above Commercial Encourages higher density development in a targeted area. e / Projects are certified through State OHCS. / Certified projects eligible for property tax abatement of up to 80% (20% per floor for first four floors of residential above commercial.) / Tax abatements are applied only to the value of the building not the land. / The Zone must be in a qualifying area of a city. / Abatement for a 10-year period if applications are approved before January 2016. City of Tigard X a� ■;•�' 1 �� •� �� 1� Original F: Empty Bank Building - Proposed Development with VHDZ Under Construction Example : OR Fourth • •p - - progress) _y City of Tigard 0 Example : Milwaukie, OR North Main — Kemper 2007 City of Tigard Ms r 4 EMI City of Tigard State Designation Criteria: / Contains property for which land-use comprehensive plan and local ordinances allow mixed-use development. / Entirely within ahalf-mile radius of existing/planned light rail station or quarter-mile of fixed-route transit. 1 Completely comprised by the core area of an urban center. City of Tigard ' Bin`s �,� � ' � �ml ,.. ■Tl� „ ,�.i d IN ' 1.°'x�'�11 �n':n'��•- � 11116 1 •ss.. ■ r ... � �' � .1� .,1 �'¢ n�::'1 _! 5111111 1 -R;• ,._• T�■1 ■ "�111 - b�. 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Rn. °I � y*�I � ry9 gg: ' n9r�" c ° 4W1�ra� .a o 1 rr l■nl 1 ■a '"•` X77 i H Com` a■ 11 ILMM awl.. -1ny°nr/ ii�l6iiY~ II+° I r >2� °s Rin r■H■I ■ni 1'� ' s s .t Him I� r®niin.� � ..•111111 •� .p „: � "4 x _�" 1 - � i i� r'nWi"I -? s ?C::■�"." r J T v � L r• r t o ir'lir i"i■ 1 ■ ��- A a;:a=E S■■lr.�■ e NO 11 7011111 ■ InuP� I 9ll�s a I 'i lu nU r.- '� lV , ...... wIR11L•N " �� e.m��r.... ......„111 ..,,e■°�6o■■i 7; � City of Tigard District Analysis: Fixed Route Transit Vertical Housing Analysis �Jj Eligibility Regturements 1 Urban Center n Mixed Use Zoning FtF Light Rail Station ® t" ®Tigard City Boundary � F ®® c E90 ME IN r a � ®�® — ®m® _ R ®® ®� t.Ad�y.K 5�4e `y BE E ON `POR N33" �Idi es � 0 ©.125 025 7 �� s �� —;_� 9 i f TIGARD SHE. WOOD City of Tigard District Analysis: Town Center (Alternative) �Verticat Housing Analysis Eligibility RegWrements �-1 MetroTown Center Mixed Use Inning Light Rail Statiun E ' ®Tigard City Boundary 7 E r ] � e f L .. _ v d y K1p�..-. 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I s -��';1 a�- ia.1 i .• � ��� :n �i � I/� a ����i,1, Ls , %im sa i 11 '■ir■CI �'^r s. �•` ✓ :If +b+. �� 9 A Q � , s■�■■gRNI� s;,gin ,• � ;:� �" is= , ,.■,=r .. .+� all�■' MI ■' lal�y I �'j. ^��� �V��II� ��■ nJl!■a1�F P Cz��:�'�•, s '-Eye l =c.. of "* r � P n■■■n •r� +x �...NIIIIIIC: - A+t � *£I� y� Nr ri2���"i■' �,` a�4.. IIt IiNil�� �. r•�� 4 ■ a ■■?.:n'e':=-�,3.� u �r :. p�Il r 111111��.,. � '��mrNl. i� T�, `, + %n.i a"■.'i:■��E�I�I�h.�l " _:,L�■■'m=■!r ■i•l7lr�jr7rsy■I��-� � I ,� �' y'�� w ■ I ■■ r r I�`=�ri City of Tigard District Analysis: Downtown/Town Center Downtown Town Center Number of Properties 196 Properties 400 Properties Land Value $76.9M $187.8 M Value of Buildings/Structures $97.5 M $235.8 M Acreage (non-ROW) 174 Acres 327 Acres M50 Assessed Value $76.41VI $258.1 M City of Tigard Recommendation: Town Center Verticat Housing Xnatysis Eligibility RegWrements fMetroTown Center 4 k` Mixed Use Inning ' tt Light Rail Statiun E ®Tigard City Boundary 7 ON AIII - Emu t Ad-y �) BE E ON i--,POR no, �Idl es R 14 iJ TIGi41RD A � SHE. OO TfiA T. - ape \ f City of Tigard Process and Next Steps / Approval to move forward with application to State to authorize a local VHDZ zone. / Adopt Resolution for Zone designation. / Notify overlapping taxing districts. / Meet with taxing districts as needed. / Complete and submit application. / Wait for State approval. / State OHCS will notify County Assessor. F V" ' Vertical Housing Program Housing an Community einces Program Factsheet Program Overview The 2005 Legislature passed legislation moving the Vertical Housing Program from Oregon Economic and Community Development Department(OECDD)to Oregon Housing and Community Services (OHCS)beginning in November 2005. The purpose of the Program is to encourage investment in and rehabilitation of properties in targeted areas of a city or community, to augment the availability of appropriate housing, and to revitalize communities. The program encourages mixed- use developments that contain both non-residential and residential uses in areas (zones) designated by local jurisdictions. The residential portion may be for market rate or lower income households. Eligible projects receive a partial property tax exemption which varies with the number of"Equalized Floors" in a project,with a maximum property tax exemption of 80 percent over a 10 year term. An additional partial property tax exemption on the land may be given if some or all of the residential housing is for low-income persons (80 percent of area median income or below): Eligibility Requirements/Zones An eligible zone is any area that meets the criteria for a Vertical Housing Zone which has been designated by the local jurisdiction and has been approved by the Department. Any project that has made application to and has been approved by the Department may receive a partial tax exemption as determined by the number of Equalized Floors for a maximum of 10 years. The tax exemption will be based on the number of Equalized Floors as determined by the total square footage divided by the number of actual floors of the project that are at least 500 square feet per floor. Equalized floors will be rounded down to the nearest whole number(e.g., any equalized quotient between 1.0 and 1.99 will have a rounded Equalized Floor equivalent of 1.0). Application / Charge The application can be accessed via the OHCS Web site. Eligible criteria and instructions can be accessed through the Oregon Administrative Rules for the Vertical Housing Program. A non- refundable Project Application charge of$550. A one-time Monitoring charge of$150 for projects with no low-income units, and$200 for projects with low-income units. For more details,visit: hqp://www.oregon.gov/ohcs/pa es�/hfs_vertical housing pro ra�px For More Information For more information,please contact us .... To talk with someone about developing affordable housing in your area,please contact a Regional Advisor to the Department. Regional Advisor to the Department Main Office: (503) 986-2000 Webpage: http://www.oregon.gov/ohcs/Pa esg /DO_RegionalAdvisors.aspx Page 1 of 1 More information: Revised 03-26-2013 Don Herman,Program Representative Phone:(503)986-2082 E-mail:Don.Herman@hcs.state.or.us ,„,„Y Tigard City Center Development Agency The City of Tigard's Urban RenewalAgency CCDA M E M O R A N D U M TO: City Center Advisory Commission FROM: Sean Farrelly, Redevelopment Project Manager and Lloyd Purdy, Economic Development Manager RE: Vertical Housing Development Zone- Agenda Item 5 DATE: March 4, 2014 At their April 1, 2014 meeting, the Board of the City Center Development Agency will consider a Vertical Housing Development Zone (VHDZ) in the Urban Renewal District and potentially portions of the Tigard Triangle. If the Board is in favor of the program, the City Council will adopt the zone at a subsequent meeting. The Board of the CCDA was previously briefed about the concept in October. What is a Vertical Housing Development Zone? State enabling legislation allows municipalities to adopt a Vertical Housing Development Zone to encourage the private sector to build higher-density mixed-use development (first floor commercial with residential above) in targeted areas of a city. The reduction of a portion of property taxes for a defined period of time can often improve the financial feasibility of a mixed use project, particularly in markets where lower achievable rents might not support the cost of new construction. The City may define a Vertical Housing Development Zone by applying to the State of Oregon Housing and Community Services Department (OHCS). Qualified new development projects within a Vertical Housing Development Zone are eligible to receive a 10-year property tax abatement on the value of new construction for up to 20% per residential floor (for the first four floors) above a commercial ground floor (for a total property tax abatement of up to 80%). • Projects are certified through State OHCS. • Tax abatements are applied only to the value of the building, not the land, although an additional partial property tax exemption on the land may be given if some or all of the residential housing is designated as affordable housing (80 percent of area median income or below.) • The Zone must be in a qualifying area of a city, consistent with OHCS criteria. • Each project is provided with the abatement for a 10-year period if applications are approved before January 2016 (current legislation) • Abatement applies to all taxing jurisdictions. Taxing jurisdictions have the option to "opt out" of the zone. Other communities (Hillsboro, Milwaukie, Gresham and Oregon City) have used VHDZ to encourage mixed-use residential development. The Fourth/Main Project nearing completion in downtown Hillsboro is an excellent example of how this tool facilitates mixed use development in urban infill real estate markets. 2