HomeMy WebLinkAbout02/01/1993 Work Session
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City of Springfield
Work Session Council Meeting
MINUTES OF THE WORK SESSION OF THE
SPRINGFIELD CITY COUNCIL HELD
MONDAY, FEBRUARY 1, 1993
The City of Springfield Council met in York Session in the Springfield City
Hall, Meeting Room 2, Springfield, Oregon, on Monday, February 1, 1993 at 5:35
p.m. with Mayor Morrisette presiding.
ATTENDANCE
Present were Mayor Morrisette, Councilors Schanz, Walters, Berg, Maine, Burge
and Adams. Also Present were City Manager Michael Kelly, Assistant City
Manager Gino Grimaldi, City Recorder Eileen Stein, and members of staff.
1. Draft Springfield Comprehensive Housing Plan
Development Services Director Susan Daluddung introduced the Draft
Comprehensive Housing Plan. She explained the plan will go through a
citizen involvement process, as well as review by the Planning Commission,
but the housing staff wanted review by the "policy making" Council first.
Ms. Daluddung described how this plan covers the many aspects of the
Development Services Department by coordinating the divisions of planning,
community development, building safety and property management. Ms.
Daluddung stated this plan is a top Council priority goal for 1993. She
highlighted some of the overall geographic data discussed in the plan,
specifically pertaining to the definition of affordable (meaning affordable
for all income levels). She introduced Management Analyst Lynn Nakamura
who would provide the staff report.
Ms. Nakamura explained three aspects of the plan would be highlighted:
1. Home Ownership Opportunities
2. Rental Housing for Very Low Income Households
3. Policy Direction for Non-Profit Organizations
Ms. Nakamura indicated Council was requested to provide input on the
citizen involvement process. She explained the process the plan will
follow discussed in Attachment II of the staff report.
1. Home Ownership Opportunities: Councilor Burge stated is he concerned
that housing values data on the matrix in the staff report are outdated.
Ms. Nakamura said the information is based on 1988/89 census data, but
relative percentages are the same in comparison with Eugene, as well as the
State of Oregon.
Mayor Morrisette said he would like the $100,000+ five year goal figure of
6% to be higher. He believed in five years the number of homes over
$100,000 will be higher simply due to inflation. Councilor Maine stated it
is more important to think in terms of percentages and relativeness, than
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City of Springfield
Work Session Council Meeting
Page two
absolute value. The Council discussed this plan as a Council goal, and
said it is not 'ambitious enough. Some ideas included increasing the
threshold to $120,000 or adding a new category of over $150,000.
Ms. Daluddung explained factors used in determining the 6% in five years
goal. The Council discussed whether this plan will accomplish that
objective because it was felt 6% is too modest. Ms. Daluddung replied many
factors, such as more aggressive annexation policy, could impact this
figure. .
Mr. Kelly clarified the direction of Council regarding the upper end of
housing. Councilor Walters suggested using 3% of the median index versus
the 6% goal in five years, so the city would stay current. Councilor
Schanz asked the Councilors how they would achieve high end housing, since
builders/contractors have the control. Mayor Morrisette responded by
saying certain areas of the city would need proper zoning, by annexing
other areas, as well as the city's property management staff promoting lots
up in the hills.
Councilor Adams said this plan needs to reflect the images that the city
would like to project, as far as housing needs and policies. The Council
decided that policies need to be in place that will facilitate development
of higher end housing.
2. Affordable Rental Housing: Ms. Nakamura explained that according to HUD
standards, "affordable" rental housing is 30% of income spent on housing,
and a "severe burden" is categorized by spending 50% or more of income on
housing. She gave details regarding Springfield's housing needs as
presented in Matrix 2 of the staff report.
Council asked questions and discussed the goals and how they were derived.
Ms. Nakamura replied the goals are based on an assessment of rental housing
needs in Sproingfield, as studied by the Lane Council of Governments in
1988.
Councilor Berg expressed frustration over the federal HOME program and the
fact that funds are not readily available to purchase homes. Ms. Nakamura
replied it is due largely to insurance issues covering mortgages.
Councilor Burge stated it would take 75 years at this current level to
provide enough affordable housing for those in need. There was a ,
discussion regarding changing federal regulations and low federal support
for the HOME program.
Councilor Berg suggested building homes for people needing affordable
housing versus providing rentals. Council discussed other ways to utilize
the private and non-profit sectors to provide adequate affordable housing.
3. Policy Direction for Non-Profit Organizations: Ms. Nakamura discussed
proposed policies for facilitating housing development by non-profit
organizations. She explained the procedure for organizations to pay
reduced fees based on the income level of target home buyers/renters.
Councilor Burge asked what happens if a non-profit sells property to a
private party, and how is the money recapped. Mayor Morrisette replied
that homes built by Habitat for Humanity can not be sold for twenty years.
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City of Springfield
Work Session Council Meeting
Page three
Mr. John VanLandingham replied the city has a program in place in
conjunction with the Oregon Bankers Association to recapture equity in
those circumstances.
Councilor Berg questioned why the city is subsidizing affordable housing,
when the city already has a 40% level of low income housing now. He feels
we need to promote a more balanced housing structure. Mr. Kelly reviewed
the funding matrix and explained how the city will be spending more money
over the next five years on upper ending housing, and how the goals
intermingle.
Councilor Berg said he will be satisfied if our goal is to increase
affordable housing that is owner occupied, not rental.
2. Property Tax Exemption Programs for the Development of Low Income Housing
Development Services Director Susan Daluddung introduced this item and
stated it was developed in response to Council direction based on the
request of Mr. Dan Desler, Good Neighbor Care Centers.
Ms. Nakamura explained the twenty year property tax exemption proposal for
low income housing developments. She clarified one ordinance will give tax
exemption to non-profit developers and one will give exemption to private
developers. She stated a public hearing would be held in the regular
session meeting later in the evening to adopt supporting ordinances.
Councilor Maine asked how the previous Council stood regarding this issue,
and if any promises were agreed to or implied. Mayor Morrisette responded
the only prior commitment made was that the Systems Development Charge
(SDC) would not be waived.
Ms. Daluddung reviewed the history of Mr. Desler's request regarding his
Springwood development project. She said Mr. Desler provided the Council
with a list of assistance requests and reviewed the list, which included
property tax exemption status.
Mr. Kelly explained that this program has been postponed until the
Comprehensive Housing Plan could be developed. He told the Council after
their review of the housing plan, they could evaluate the Springwood
Development proposal with regards to the housing policies. He added other
needs of Mr. Desler, such as infrastructure, would be addressed at another
time.
Councilor Yalters asked how the McKenzie Meadows project could be developed
with affordable units without any city assistance. Mr. Desler replied
there is a competition for tax credits, and Bowen Corporation had access to
a greater percentage of tax credits that he does. He said the difference is
4 percent versus 9 percent, and at the present time there are no longer any
credits available. Mr. Al Johnson added the developer must build within
the same year that the tax credits are sold. Due to the Springwood appeal
process, Mr. Desler was not able to begin construction within the same
year. Mr. Desler further explained the occupants of the Bowen development
are at 80 percent of the median income, and the targeted people for the
Springwood development project are at 50 percent of the median income.
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City of Springfield
York Session Council Meeting
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Mr. Desler also provided information regarding elderly people wishing to
cash out their capital gains money and apply the funds to an affordable
housing project. Mr. Desler said if an elderly person sells their home to
live in his affordable housing, it then makes available housing stock for
younger first home buyers.
Council discussed the tax exemption program in relation to the Springwood
development proposal, specifically in regards to finding affordable housing
for the elderly.
Councilor Maine asked if the Council supports the program, if they will
have defeated their own goals with regards to the housing policy. He added
that any policy implemented will not just affect the Springwood project,
but all low income housing projects in Springfield.
Council discussed the amount of tax exemption needed to assist the
Springwood development ($83,000), if a cap should be placed per annum on
exemptions, and the length of the exemption period (20 years).
Mr. Desler commented the exemption would be passed on to the consumer, and
not his company. Mr. John VanLandingham spoke about other developers and
projects such as Mr. Terry McDonald with St. Vincent De Paul, and their
possible interest in the tax exemption program.
Mr. Kelly explained his reasoning for suggested a per annum cap. He gave
details about the city's $10.00 tax rate cap due to Ballot Measure 5 and
how the city will not lose money until the $10.00 cap is reached. Mr.
Kelly stated a $100,000 tax exemption over a twenty year period would have
some impact on the city, but would not be a significant burden. On the
other hand, if the Council allowed a five year exemption, then the city
would suffer no financial impact.
Councilor Maine said the Council has reached consensus to provide a total
$100,000 tax exemption for incentive to developers of low income housing,
either for profit or non-profit. Ms. Daluddung said Mr. Desler would need
to come to the Council with an application for his tax exemption request.
Council members understood that Mr. Desler's application would probably
consume about $85,000 of the $100,000 total program. Mr. Desler commented
the tax exemption would be the only financial request he would ask of the
city, except for support on traffic signals, obtaining County road fund
money, etc.
ADJOURNMENT
The work session was adjourned at 7:25
p.m'6id~Ai
Mayor '
Minutes Recorder - Eileen Stein
ATTEST:
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Ci ty Recorder
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