Eugene council approves 10-year multiunit property tax exemption for Station House at 131 E. Fifth Ave.

The Eugene City Council on April 16 approved a 10‑year multiunit property tax exemption for Station House, a proposed six‑story, 124‑unit mixed‑use development at 131 East Fifth Avenue in the city’s Market District.

Councilors voted 6‑2 to adopt a resolution to grant the exemption for residential units and residential‑dedicated parking; the motion carried with Councilors Lincoln and Keating opposed.

City staff told the council the project would place 124 residential units above a ground floor with more than 7,000 square feet of commercial space, and a two‑deck garage providing roughly 218 parking spaces. Staff and the city’s third‑party financial consultant, Pacific Northwest Economics, concluded the development would not be financially viable without the MUPTI and recommended approval. “It won’t be built without a MUPTI. It absolutely will not be built,” Councilor Clark said during the discussion.

Why it matters: The exemption would forgo an estimated $9.1 million in building‑value property tax over 10 years while aiming to spur new downtown housing and long‑term tax revenue. Staff estimated the completed project (valued at about $68 million) would generate roughly $1.1 million a year in property taxes beginning in year 11 and rise to about $1.5 million by year 20; the site currently generates about $60,000 a year in property tax on land value.

What the council considered: The MUPTI program requires projects to demonstrate public benefits and financial need. Staff briefed council on design and compatibility criteria, historic‑resource review and public‑benefit elements. Urban design staff concluded the project meets design and compatibility standards and does not adversely impact adjacent historic resources including the Oregon Electric Station and the Southern Pacific Railroad Depot. The final design submitted during review added brick along the high ground floor, larger storefront windows and a recessed front courtyard, among other changes.

On public benefits, applicants may either set aside a portion of units at moderate‑income rents or pay a fee equal to 10% of the total tax exemption over 10 years; the Station House applicant chose the fee option. Staff estimated the fee at about $914,000 and said the city would deposit that payment into a dedicated moderate‑income housing fund. Staff also said applicants may pay the fee up front at a discount or elect to pay over years three through ten of the exemption period.

Parking and tax treatment: The MUPTI review panel recommended excluding the first floor of commercial parking from the exemption but including parking decks dedicated to residential tenants as part of the exempt residential use. Staff said the city worked with the Lane County Assessor to estimate value; the assessor had not finalized an assessment, but staff estimated the commercial parking portion might represent roughly 5% of total development value if only half of the parking structure is treated as commercial.

Program cap and timing: The city’s MUPTI program has a 1,500‑unit cap. Staff said there are currently 928 units approved under the program (about 62% of the cap); adding Station House would raise the total to about 1,052 units (about 70% of the cap).

Council debate: Supporters emphasized the long‑term tax revenue and the need for more downtown housing. “If we do, in 10 years, we will be getting sizable additional taxes that will help provide services,” Councilor Groves said. Dissenting councilors raised concerns about timing during city budget pressures, precedent and local impacts. Councilor Keating said he would prefer investment in other corridors and criticized the project’s effect on views of Skinner Butte, adding that future renderings should show local landscape context and potential view obstruction. Keating also cited concerns about the lack of environmental study related to bird migration near the Butte.

Other details: Staff reported the applicants committed to a local economic impact plan that estimates a high share of procurement going to Lane County firms (the applicant estimated 75% local spending and stated a target of 50% for certain contract categories). The project will follow the building permit services pathway for green building requirements, requiring an engineered energy model demonstrating at least 10% better energy performance than code.

Outcome and next steps: The resolution to approve a 10‑year MUPTI for Station House passed 6‑2. Staff said the council could have modified conditions of approval or denied the request; with approval, staff will proceed with final conditions and monitoring the applicant’s compliance with program requirements, including the moderate‑income housing fee and local contracting commitments.

Votes at a glance: Motion to adopt the resolution approving a multiunit property tax exemption for property located at 131 East Fifth Avenue (attachment B to the AIS): passed 6‑2. No votes: Councilors Lincoln and Keating.