Title
Vertical Housing Development Zone
Body
RECOMMENDED ACTION (Motion):
Goal 1: Implement Economic Development Strategy and Maintain an Environment for Success - Staff recommends that the City Commission consider information regarding the Vertical Housing Development Zone and direct staff to proceed toward establishing a Zone for Oregon City.
BACKGROUND:
The Vertical Housing Program was adopted into state law in 2001. A Vertical Housing Development Zone (VHDZ) is an area designated by the Oregon Housing & Community Services Department (OHCS) under ORS 307.600 to 307.637. The area must be entirely within either a light rail station area, a transit oriented development district, a core area of an urban center, a defined central city, regional center, town center, main street or station community in the Metro 2040 Regional Growth Concept Plan, or an existing central business district or downtown area.
Developing more housing units in the downtown is vital to the continued revitalization of the area. A significant residential component will provide support to commercial development and enhance public safety. The VHDZ designation will encourage such development by offering partial property tax exemption to qualified projects. This is not a low-income housing program since it applies equally to all levels of housing. It does not sacrifice commercial space in favor of residential use. Instead, the VHDZ program encourages both commercial and residential development, since a development must have both residential and commercial components to be able to qualify under the VHDZ program. Although this program offers tax exemptions to qualified projects, it is designed to ensure that taxing districts will not be negatively impacted. The tax exemption applies only to the additional value created by the project. Typically, districts will receive taxes on 100% of the "pre-project" value of the property, plus taxes on at least 20% of the additional value created by the VH...
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