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After heated debate, Albany council adopts multiunit property tax exemption ordinance; guidelines, county IGA approved
Summary
Following multiple amendment attempts and questions about public benefit levels and downtown exclusions, the Albany City Council adopted an ordinance creating a Multiunit Property Tax Exemption (MUPTI) program and approved guidelines and an intergovernmental agreement with Linn County.
The Albany City Council adopted an ordinance on Nov. 5 establishing a Multiunit Property Tax Exemption (MUPTI) program after extended debate over program scope and public benefits.
Council discussion focused on whether the program offers adequate public return for a potential seven- or 10-year property tax exemption. Councilor Thompson said the proposed thresholds were too low and proposed increasing the in-lieu payment to 20% of foregone taxes and requiring more public-benefit items ("I continue to support increasing that rate to 20% of the total tax exemption," the councilor said). That amendment and related adjustments that would have raised the in-lieu payment and public-benefit minimums failed to gain majority support.
Another amendment proposed excluding the historic Central Business District from the designated MUPTI boundary; that amendment also failed. Staff and proponents, including representatives invited to speak, urged caution about reducing incentives, saying some projects require the MUPTI tool to be financially viable. A staff representative summarized the program's checks: projects must pass an independent financial analysis showing the exemption is needed and SDCs, connection fees and other infrastructure charges are not waived.
On a roll call the ordinance vote resulted in a tie; the mayor cast the deciding vote in favor and the ordinance passed. Council then adopted a resolution establishing program guidelines and authorized staff to enter an intergovernmental agreement with Linn County to implement the program; the IGA authorization passed 4-2.
Councilors said they supported using the tool selectively to incentivize construction in underutilized areas, while some warned the city must ensure public benefit when taxpayer revenue is delayed by abatements.
The adopted ordinance and guidelines will allow the city to consider qualifying projects under the MUPTI framework, subject to the third-party financial analysis and the public-benefit requirements written into the program guidelines.
