Good to go.

Okay, cool.

Session of the Forest Grove City Council.

Um, the topic is we so the topic is on our LOC priorities.

There's no public comment will be taken.

The council will take no formal action.

And with that, I'm gonna turn over to Jesse.

Thank you, Mayor.

Members of the council.

I'll try to keep my staff report brief so that council could reach consensus on the city's top five legislative priorities.

Um, but a little bit of background, the city is a member of the League of Oregon Cities and League of Oregon Cities every even numbered year appoints policy committees to go over various policy proposals that they will in turn advocate for down in Salem during the 27-28 legislative cycle.

As part of that process, they ask each of their members, of which we are one to come up with their top five priorities.

Once we come up with our top five priorities along with all of their other members, we submit those priorities to the League of Oregon Cities.

Those votes are then tallied at the League of Oregon City level and the LOC board of directors uh will review all of those votes in the top prior and the top five priorities for the League of Oregon Cities um uh by September 25th, and then that will become essentially the League of Oregon City's policy agenda or advocacy agenda for the upcoming legislative session.

So with that, um I did submit the um what is called the uh the LOC member voter guide, which has I think 27 different uh legislative policy priorities that came from all the various committees within LOC.

I submitted that to all the department directors and we did a little bit of internal uh polling and the results that came back from uh city staff, which are are certainly just uh city staff's opinion are on the memo that was submitted to the city council.

But um with that, I'd be happy to uh answer any questions.

Once council reaches consensus, uh then as the city manager, I will submit to the League of Oregon Cities on a ballot what the top five priorities are, and then it gets certified by LOC.

So with that, unless there's any questions, that's my report, Mayor.

Okay, great.

Thank you, Jesse.

So let's go over the process for how uh we're gonna do this.

I you know, I I would like to thank Jesse for sending this out in advance.

So we had a chance to look at it, I think a couple weeks in advance, not just with the normal packet.

Um what I was thinking we could do is maybe I probably should wait to eat.

Maybe we'll go through and say what our priorities are and I'll just tally them and we'll see we'll do like we'll start the discussion there.

And then if there's some that are on the bubble or you know, competing, then we'll we can make our case.

Does that sound like an okay?

Okay.

Counselor Schimmel, do you mind if I start with you?

Sure.

Well, I had uh selected seven or eight to see where where the staff guidance was, and all five of theirs were in that group.

So I I will concede to staff's recommendations on those five.

Okay.

So one counselor's saying agreeing with staff, and I think staff's was transportation package infrastructure, land availability, public meeting laws.

What was their what was their fifth one?

Cybersecurity.

Cybersecurity.

Okay.

Great.

Um I'm just gonna say staff rec one.

Okay, and then uh Councilor Falconer, are you good to uh my top five were um two from the housing, full funding and streamlining for production, um, housing land availability and land use, uh, water and wastewater infrastructure, 2027 transportation and public meetings law.

Okay, thank you.

Councilor Martinez.

Yeah, I felt that there's the recommendations by staff.

Okay.

Okay, and same with councilor Marshall.

So what I had put on mine um is similar to staff and similar to Councilor Falconers.

I had transportation package, infrastructure funding, land availability, and land use streaming, public meeting laws, clarity, and full funding and streamlining for housing production.

And then the one that I put on there that I was curious about, and um, I'm not gonna like die on the sword, but is the alcohol revenue modernization.

I think that that plays into uh you know our our work with public safety.

Uh, we need to figure out some revenue, but then also in the state, like my understanding is the state of Oregon is behind on that.

Um, and if you look at like our responses to people experiencing homelessness, I just thought that would be interesting.

So I just wanted that was on my list, but I'm by no means married to that.

We get five, correct?

Yes.

Okay, so there's one, two, three, four, five, six of us.

Wait, no, there's one, two, three, four, five of us.

Okay, so the one that I'm kinda I mean, I'm just gonna be pretty candid and blunt.

That's been my MO today.

But the cyber security, I guess I would like more information from staff because I personally think the full funding and streamlining for housing production was not on staff's list.

But then if you look at our 2040 action plan and then working with if we're gonna do land availability and land use streaming, and what I've been um advocating for from the MMC is really like this and the infrastructure funding, like all of these things are to me a package.

Um, and so I think those are the most important.

And so I guess I'm just curious as to how staff sees it and you know what guidance you can give us.

So good question.

Thank you, Mayor.

The the one thing I will say about the the fifth priorities support municipal cybersecurity proficiency was um we when we got all the results back, we just tallied, you know, which one had the most votes per se.

Um the top four all had three or more votes, and then there was one, I believe, that had two, which was number five.

Then there was a really, really long list of ones that had one vote, essentially.

Um and so I know that's not answering the question as to exactly why staff did, but I just wanted to let you know in terms of kind of the priority ranking, so to speak, uh it was pretty it was very, very close because we had a lot that were ranked at one, one that was ranked at two, and the rest were ranked at three or higher, just to give you a little bit more context.

I was not able to have follow-up meetings as to why directors chose this particular one versus another one.

But hopefully that gives you a little more context.

Yeah, thank you, Counselor Shamel.

If I can uh maybe ask the question a different way, I mean, what do we stand to lose if if we were to swap out the support municipal cybersecurity what the the relevance or how does that solve the city's versus say the housing uh item?

Well, I think I think staff just offers these for just information.

I don't think there would be anything to lose per se.

I think it would be you know, this is the discretion of the council, and whatever top five you'd like is what we'll submit.

So yeah.

Counselor Feltner, and then Councilor Martin.

Sorry.

No, I'm looking at you, and then her.

To me, the I mean I think we all agree that you know cybersecurity is important.

Um, this goal here just feels a little vague to me.

And it's not very I'm not even really clear about you know, kind of what LOC is really advocating for on this one.

I I'm I'm certain that the full funding, you know, the two housing ones, those are definitely going to be important.

I think that's and they're definitely important to the city for our own timeline of where we are, where we're falling on on our housing capacity um housing needs, you know, assessment.

Like that has to be that we're we're kicking that off this week.

Um, and then that immediately is followed by housing production strategy.

And so I think that um, you know, putting our voice behind those two are really important because they match our goals, you know, match our objectives, also our obligations.

And I'm I'm pretty sure that they're really these are the ones that are gonna move forward.

I'm just not entirely clear on what the cybersecurity one is.

And so I don't I just don't want to, I don't want to call it wasting a vote.

I just think maybe our vote is a little bit more impactful on those topics.

Thank you.

Counselor Martinez.

And my um in my opinion that the cybersecurity is very important because of what's going on in our uh world so far with AI, um, other countries um hacking um systems.

I don't think that that's something that we should set aside.

And it's really is something that needs to be addressed, and we need that backing of the state to do that as a small community.

Yeah, I I think we're like I I feel as the facilitator a little bit in a pickle because we have two members missing, and then the the consensus is three two.

It's not this has to be clarified today.

Like we can't we can't get our opinion in there and then get it because I'm on the fence.

Like I would the alcohol revenue monetization was also one that I looked at, but I was going these were also on there as well.

But that one hasn't like it says on there, it hasn't been changed since 78.

Right.

Like it's been quite some time to kind of just take a look at it and see if it needs to change.

And so I don't know if that's what they're looking at on this.

So I like when is staff when is this need to be completed?

I think it's September 15th or sometime the middle of September, I believe.

I'm not yeah, the deadline for submittal is uh September 25th, and so um there is another council meeting in between now and then.

Um just a little bit of clarification.

If a city submits you know their top five, it doesn't mean that the other ones aren't important, it doesn't mean that LOC won't advocate and won't respond.

Um, because those positions are already set, those were come up by the committees.

This is really just prioritizing out of the 27, which ones that they will kind of advocate for and step out on, if you will, but it doesn't mean that they won't be responsive or even potentially you know, advocate to submit legislation on some of the other ones.

Um it it just means that this will be their top five priorities.

And I would also add that I think we're one of 150 some cities that are part of LOC, you know, so um we get the same vote as any other city that's a member.

There's not a prioritization of votes within LOC, so we're all kind of voting on the same platform, so to speak.

So just a couple other context.

But if but yes, we do have some time.

Um there have been some cities that have submitted already.

There's others that are most cities are kind of considering this in July, August, certainly before September, yeah, to get our vote in.

Counselor Falconer.

Um did we I know we don't have two of our two of our counselors, did they provide you feedback before the meeting?

No.

Okay.

No.

Here's I guess my follow-up question of the council.

If we think that individually we're gonna reach out to and dig into these and try to do some homework, then I'm okay adding this to an agenda item in the future.

However, if we're not gonna do any additional research, I think we should try to come to some sort of decision decision today.

You know what I mean?

Like I do think it is, you know, there are other cities.

What I'm hearing at the MMC level, you know, on in my groups is I did not hear cybersecurity come up.

I mean, and in like the state, you know, what's on the horizon for the state.

And so I think for me, sometimes it's just really important, especially for small communities like Forest Grove to push up those things that will have a significant effect on our community.

And that to me, that's infrastructure funding, right?

That's like all this housing production, like this could really move, and our community members could see it.

Like they could feel the result of this legislation.

And I do think cybersecurity is important.

I think my hesitancy to not put it as a top priority, is that I'm curious as to what our state legislature is actually gonna get out of it.

Like actually gonna what product?

No, I should I want to reword that what product we're gonna receive from this work.

You know what I mean?

I don't know.

That's kind of counselor Schimmel.

Well, uh I'm I'm persuaded the to change from the cybersecurity to the housing production for the fifth one.

Well, let me go back to my first question.

Does anyone want more time to think about this and to reach out and research, or do are we prepared to make a decision or come to consensus today?

I'm prepared for today.

I'm okay with today.

I mean, uh I'm with the understanding that you know, we're you know, we're gonna ha establish council priorities going into the legislative session and and how we're gonna advocate directly.

So these may uh uh reveal themselves over the course of six, seven months versus couple you know, a few weeks.

Counselor Falkner, I don't think that this precludes us from advocating for any kind of cyber.

I mean of course not, right?

I mean, we could always decide that if there is a bill that we think that the state is gonna step up and actually help, you know, communities deal with cybersecurity risk.

Um that we can certainly advocate for that.

I don't think that these two things are exclusive.

Is is our city manager also expressed that we're one of 150, so they could bring that up as well, right?

Okay, so uh do we have consensus on we had consensus on the four?

Is the fifth one to go with full funding and streamline housing production or is there a thumbs up for that?

Go ahead.

Yes.

Okay.

Yes.

Okay.

Counselor Marshall.

For replacing the um cybersecurity for full funding and streamlining.

I would go with alcohol revenue modernization.

So I don't know.

Okay.

Yeah.

I mean, if they're renting it.

It's three to two.

Yeah.

Okay.

So we're gonna go with full.

So we're gonna go transportation package, infrastructure funding, land availability and land use streaming, public meeting law clarity, full funding and streamlining for housing production.

Those are the five city manager.

Cool.

Okay.

And with that, I'm gonna adjourn this work session and we're gonna reconvene for our CEP meeting at 6 p.m.

It's a work session.

There's action.

So we are gonna start this work session, the Forest Grove City Council.

No public comment will be taken, and the council will take no formal action.

And it is actually a work session of the Urban Renewal Committee, I believe.

And not you in the council.

So with that, I'm gonna pass it over to our city manager and our assistant St.

Mander.

And they'll figure out who's going first.

Okay.

Mariah, do you have the presentation?

Thank you, Chair Wenzel and directors.

Um I'll just go ahead and kind of get into it while Mariah is bringing this up.

We actually have two work sessions planned for the Urban Renewal Agency.

This is kind of to set the stage for the second work session, although there may be some things at the end uh that we would like to talk to the board about about potentially following up on between now and the meeting in August.

So there's quite a bit of background here.

Um, and then uh and again we're kind of just setting the stage for a second work session in August when we get some some studies done.

So with that, I'll kind of dive into it.

I'm just gonna not go into all of the details of every slide.

I'm gonna kind of pull out some of the uh more pertinent things that are germane to this discussion, but uh would welcome any questions of either Kim or I uh during during the presentation.

So as I kind already mentioned, the purpose uh of tonight's work session is to give the board sufficient information to make an informed policy decision about the next steps regarding really three developable properties, and we're gonna go into detail on what those are that are currently owned by the urban renewal agency.

This is the first of two planned work sessions.

So next slide, please.

Uh this is what we're gonna cover tonight background, some milestones, some case studies, uh, the property overview of all three properties, and then a little bit about the financial metrics.

The work session number two is really gonna be kind of what I would characterize as potentially consequential in the sense that it's gonna have the feasibility studies.

We'll talk a little bit about what we have so far with those, and then some potential marketing and development pathways.

Question Yes in the marketing and development pathways, that's when we're gonna talk about like what we're willing, what this council is willing to offer developments.

Yeah, we and we might like I'm just wanna know where is this happening at?

Like we we might get into a little bit of that tonight as well.

I think that discussion will be fully informed once the feasibility studies are done about the grocery store and the and the boutique hotel.

But it doesn't mean that it can't be talked about tonight either.

So have an idea.

So, really in terms of the vision 2040 plan.

Um these three properties, redevelopment or development of these properties really fits into kind of a multitude of goals.

Uh the first one is is the economy.

Some of it is specific, uh, some of it is more general.

There's incentive programs for small businesses, strengthening our partnerships, uh, increasing commercial business development, um, looking at a potential grocery store.

Next slide.

Another goal area is community growth, and that looks at really activating policies around utilizing downstairs or upstairs apartments that's specific, you know, to the urban renewal agency.

Uh wellness through infrastructure policies and design standards.

And so there's been some conversation about a potential plaza of one of the sites that could look at you know, potentially some wellness programs associated with that.

Walkability, pedestrian barriers, addressing those, explore park and ride options that really kind of gets into transit-oriented development.

Community connection, exploring opportunities to create a central community gathering space that also speaks specifically to something that might be attached to a potential property or a potential development.

So the URA purpose, we've really covered this a lot.

Um, but generally it's to eliminate blight, it's to improve utilization of land, encourage private investment, and at the end increase the uh taxable value of the property so that when it returns to the original taxing district, um, that it is worth more than it was otherwise before, and in doing so raises additional revenue.

Next slide.

So I am going to focus a little bit on this one.

These are the URA plan goals, and these are the ones that are enumerated currently in the URA plan.

Goal one is to provide opportunities for public participation.

Goal two, a prudent annual budget to minimize financial risk.

We're going to go into that with some of the financial metrics, talk about that tonight.

Improve the local investment climate by reducing financial barriers to development and redevelopment.

And then four, promote a vibrant forest grove town center through strategic urban renewal investments.

We'll talk a little bit about the programs that we have for that.

And then last, promote commercial and mixed-use redevelopment of sites along the Pacific Avenue corridor.

Next slide.

So this is just to kind of get some thoughts out there.

Um we just went online, did a little bit of research.

If you look at some of these developments in Springfield, for example, um, that's a mixed-use development.

It has some commercial on the bottom, it has some studio one, two, and multi-family on top.

It's got a public plaza.

This was all kind of part of an overall redevelopment area or redevelopment concept in in Springfield.

Um, and it was very strategically centered on trying to get a central community gathering space.

So that was one of their you know primary objectives.

Uh, Forest Grove, that was a rendering of the Jesse Quinn project that happened.

Uh, we'll go a little bit into that in 2016.

The example with Monmouth, um, that's uh a multifamily unit that is being proposed in bid right now, and what they're really looking for is some redevelopment concepts associated with an existing building.

So when you look at kind of adding upstairs apartments, that's precisely what they're really trying to do with this development.

And then independence, this was one that was constructed, I think in 2018.

It was the same developer that did the Jesse Quinn project here in Forest Grove.

Uh, and that was had a lot of kind of concepts.

It was a riverfront property, but it had townhouses, it had apartments, it had different types of apartments, it had some amenities associated with the clubhouse, and then it also had a hotel associated with it.

So it was pretty comprehensive.

Um, in terms of a little bit more background about the URA area, we're looking at six percent of the overall area uh within the city.

Um, and you it's depicted by the boundary here, it's generally flanked by 19th, and then also Pacific, uh, excuse me, east and west of uh north and south of both of those.

Next slide.

Um, this is something that I know all of you have seen before, so I won't go into it, but generally what this is showing is that if you use the tax increment above a frozen base of assessed value and you invest that, then over time you increase that taxable assessed value by using that tax increment financing.

And so when it returns back to the original taxing taxing district, in this case 2034, that that taxing district, in this case, the general fund or the city of Forest Grove would receive more than it otherwise would have if you had not invested.

The thing that's kind of important about this slide is that, and you'll see this in the financial metrics later, is that our debt is currently structured to 2034.

So it was intentionally structured as a 10-year note, not to extend beyond 2034.

Um, and that's part of that slide.

Next slide, please.

Is it still okay?

Uh so a little bit, some milestones.

We just kind of put this together.

Uh the URA was established uh 12 years ago in 2014 by ordinance.

Uh, the very next year, um, the the board, the the agency purchased time litho.

Um we did what was called an exclusive negotiating agreement.

That was after we had done an RFP process.

So we entered into negotiations.

We eventually reached a disposition and development agreement to do uh the Jesse Quinn and construction began.

Uh, when we looked at the overall project, uh the project cost was 15.5 million.

There was approximately $2 million in URA assistance.

That assistance came through various forms, all of which were allowed under the plan.

And then in 2018, so this development is now done.

We started looking at rolling out some programs.

And some of the first, the first program was the storefront improvement grant program.

It was very popular at the time, still is relatively popular, although we are having fewer applications, I think, primarily because we've had 17 storefronts, I believe, done now.

Um, we also did an installation art program at the time.

Um then in 2019, we did the design grant program that was to assist uh businesses with a potential design that they may want to fund.

Uh, we also partially funded the 21st Avenue campus corridor study.

Um, that's what led to a request for some federal funds for that particular project.

2020, we did the site B RFP for the grocery store, and that was uh there was a uh requirement there for housing, of which 30% of those units would be affordable.

Um, and as you probably recall, what ended up happening with that was the number of units was so small that it was not a project that was eligible for funding for affordable housing.

COVID hit.

Um, and so in that particular year, we also introduced the small business assistant grants program uh funded by the URA that was kind of a one-time program during COVID.

Next slide.

We received one proposal for site B.

We did enter into an exclusion, an exclusive negotiating agreement uh for the grocery store and for affordable housing.

Um that project was not financially feasible uh uh predominantly because they were not able to secure uh some not grant funds, but some uh essentially grant funds uh to construct the affordable housing.

Uh the grocery store market analysis was we started re-upping that analysis to see if kind of anything changed associated with the grocery store.

Um, and and then in 2023, we followed that up with another RFP for a grocery store.

In that particular case, it was if you have any kind of proposal about a grocery store on site B, please let us know.

Um, and we also started drafting the big program or the building improvement grant program.

And then so two years ago, we received one proposal for a grocery store.

We did enter into an exclusive negotiating agreement.

Uh, we introduced the big and the design grant programs, uh the design grant tied to the big program.

And then uh we reviewed the URA plan for opportunity sites for potential purchases.

Uh 2025 was a pretty big year last year.

Uh we were unfortunately notified that the grocery store was not uh financially feasible, uh principally due to the higher interest rates that it accrued over the last couple of years.

Um we targeted two opportunity sites, issued some debt, we awarded some grants, we modified the big program.

We partially funded the glow up project in downtown.

Uh, and that led to ultimately this year finalizing the purchase of both the theater building and the woodfold property.

So I'm gonna cover a case study and then I'm gonna pass it over to Kim, who's gonna largely do the rest of the presentation.

Um, but we wanted to offer the board just some kind of other examples of what other URA programs are doing, where their focus is at, what some of their um accomplishments have been, uh, and just kind of how they structure the program and and uh what we found is we we looked at Beaverton.

They've had a URA plan adopted since 2010.

Uh fundamentally, it's just a much, much bigger program than we have.

Um, it's a 30-year program or 150 million dollars in what's called TIFF funding.

So if they issue 150 million, whatever that expiration period would be to recruit to to pay off that debt would be how long their URA.

So it could, it's either 30 years or 150 million dollars.

It could go past 30 years.

Uh they have an annual revenue stream of 7.4 million.

You'll see in our financial metrics later that our annual revenue stream is about a million.

Um, and then they interestingly, they they have five allocation categories, and these categories were enumerated in the URA plan itself uh back in 2010.

And so they structured their programs based on these kind of five uh initiatives, if you will.

And they have different projects for each one.

Uh they recently introduced a building improvement grant program similar to ours.

Um, it's been very popular.

Uh, and I believe over the course of that grant program, they've awarded 17 grants.

If you haven't been there, um it's worth the trip.

If you have been there, uh then this is a review.

But uh one of the URA plan projects was the round.

And the round was a really kind of a mixed-use development.

It had a public plaza, it had restaurants, it had condos.

It's what they call a transit-oriented development.

The max line goes right next to it.

So whether it's max or whether it's a bus.

Um, they have works prices, they have a parking garage underneath, they have ground level retail.

So it really kind of incorporated a lot of the concepts that I know the board has been looking at, kind of all within one development.

So, with that, I'm gonna pass it over to Kim.

Yeah, so looking at the city of Bend, uh, they took a little bit of a different approach.

They actually have three different URAs within their city with three different plans, each adopted in another year.

And we're using this as an example of how they have done different types of incentives depending on what it was they were trying to incentivize in that particular area and in that particular plan.

So, in their first Juniper Ridge, which is established in 2005, that is an area where they were looking to increase industrial development and employment density.

So that primary URA URA activity has been development assistance, up to 10% of total development project costs, and that's through property tax refunds.

Uh in the Murphy Crossing area established in 2008.

This is an area that they were looking to establish more residential housing.

It was largely viewed as undevelopable due to poor access for transportation utilities.

So the URA funding in that example has been directly invested in transportation utility improvements.

The core area established in 2020, this encompasses a lot of the downtown and vend has the most in common with our URA, the largest, most economically diverse of the three areas, and they've used more of a mixture of grants, direct funding, development assistance through property tax refunds in order to incentivize the kind of development that they're looking at there.

Switching gears over to looking at our properties.

So we have two types of zoning that are impacting the properties the URA has.

One being town center core.

This primarily, this only affects the theater building.

And the emphasis here is that in a town center core, you must have retail service located on the ground floor.

So some kind of walk-in clientele.

And then the upper floor can be used for office, residential use.

So it can be a mixed use building or a single source commercial kind of space.

For both site B and Woodfold, they are considered town center transitions.

So this can be a mix of retail office, light industrial, residential use, and does not have the same requirement for retail on the ground floor.

Next slide.

So looking in a little bit deeper, so this is site B, approximately one acre.

Again, this is town center transition.

So does not require retail on the first floor, is sloped as gravel.

There have been two RFPs.

Jesse had said a second ago, neither resulted in the DDA.

And the grocery store feasibility study is currently being updated.

Next slide.

The Woodfold lot, nearly twice the size of Site B at almost two acres, also zoned town center transition, which makes it pretty broad use.

It does include two storage buildings currently, although we may want to revisit those buildings.

One is under month-to-month lease and one is being considered for temporary storage by the city, with the understanding that this would be temporary and this is not the final and best use for that site.

There are three food carts on the site that are under month-to-month leases, and a property management firm is managing all of those leases.

Finally, the theater building, town center core, retail must be on the first floor, includes a gravel parking strip along the back side adjacent to the city's central parking lot.

Initial concept design shows a potential for somewhere between 14 to 31 rooms.

However, there may be seismic improvements that are required.

We do know that both the roof and the HVAC system are past their design life.

So there is some timeliness with redevelopment on this property that we need to start moving forward on.

And there is a property management firm, also same property management firm, also managing uh three multi-year leases and one month-to-month lease in this space.

And in our second work session, we'll be going into the boutique hotel feasibility study that is currently being developed surrounding this building.

Next slide.

And this map shows the proximity of all three properties.

So on the left, that is site B in the center top, the theater building, and in the bottom right corner, the woodhold property.

So potential projects on URA property.

This just basically says the URA plan says that development assistance or redevelopment assistance can be used for the following categories.

A public plaza, some type of transit-oriented development.

So an example of that could be assisting in some way to make it a Todd development.

Mixed use mixed use development, including housing retail and office.

Standalone residential development is eligible as a potential project.

Standalone commercial development is eligible.

Building rehabilitation, so fixing up a building that you may have otherwise purchased, science site clearance and preparation.

We've done that both for the Jesse Quinn and for site B, and then environmental remediation, which is often coupled with site clearance and preparation.

We've also used URA funds and participated in that as well.

Next slide.

And then these are just the types of development assistance.

Again, this is mostly review.

There's actually hard costs, whether it's site preparation, construction expenses, and on-off site infrastructure improvements.

There's soft costs, which can be studies.

We're just talked about a couple studies, engineering reports, traffic impact analysis, environmental analysis, STC waivers, or land write downs.

You can do low interest loans, you can do grants, you can do matching grants.

So there's a number of different ways in which the board, if they want to, could assist some type of development or incentivize some type of development to occur.

Next slide.

So digging deeper into our financial metrics.

The URA plan specifically authorized $15 million in maximum indebtedness.

So look thinking back on the chart with the triangle, the maximum indebtedness is the calculation of how much debt can the URA effectively pay off during the time frame.

For our plan, it is $15 million, and it allows up to three debt issuances.

Currently, debt has been issued two times.

Current debt amounts to about $577,000 per year of debt service payments until the year 2034.

The URA could issue more debt.

So maximum deadness of $15 million, $7.27 million was issued.

And allowable debt remaining is $7.73 million.

Annual revenue that comes in, again, looking at that triangle graph from before is about $1 million.

Again, about a little more than half of that, $575,000 is going into debt service.

Currently, $370,000 is being diverted into the grant program.

This is a budgeted amount, and about $175,000 is going to general operations.

And this is a fixed amount that we have determined for the URA required to function.

Currently, there's approximately one and a half million dollars in unappropriated fund balance or savings.

So of the seven or so million dollars that was taken out in debt, most of that was used to purchase two properties earlier this year, but there is still one and a half million dollars sitting in that unappropriate fund balance.

Assuming other expenses remain the same, this can be used to incentivize projects.

Based on current projections, this number, the savings number will be start to increase in fiscal year 28-29.

Next slide.

And from here, we will go into some hypothetical scenarios about how you could use that investment and what that uh considerations around those investments could be.

I know that's a lot of information in a short amount of time.

So Chair, I was wondering if you wanted to.

Yeah, let's do a little check for understanding.

Uh up until this point, are we good?

Are there any questions?

I think we're good.

Okay.

Thank you.

So we just wanted to outline a couple scenarios and just kind of again, this is just food for thought.

Um, so let's just make an assumption that the boutique hotel study says it's going to require $2 million in incentives to attract the development of a boutique hotel.

These are just some of the considerations.

I'm sure there are others, but these are some of the considerations and trade-offs that would come up that would be brought to the board.

One would be whether you want to incentivize a boutique hotel, and if so, at what amount?

Or is that an amount that starts to say, you know what, maybe we don't want to do a hotel, maybe we want to do something else.

Don't know what that might be, but how much do you want to incentivize, you know, a boutique hotel going in at that particular property?

The second consideration, what would the impact of doing?

So if you do choose to incentivize it at $2 million, what's the what's the impact on the other two properties?

If you remember your kind of the cash flow, or if you remember the annual revenue, or if you remember the amount that's kind of in theory in savings and what that looks like going over time, how might that impact the development of potentially site B and also Woodfold?

So and then the last would be whether to adjust, you know, kind of the URA annual programs to further incentivize development.

So for example, as part of that cash flow, you have the debt requirement, and then you also have the programs.

You have grant programs, and then you have some operational expenses associated with that.

There's always a potential option that if it's very important for the board to incentivize the development of this property, and it requires X amount of incentives to do so, there's of course the option to suspend potential annual programs to go ahead and incentivize that and use it for this until such time that that requirement is paid off, and then maybe you restart the annual programs.

We're not suggesting that that happen.

We're just trying to illustrate some of the ways the financial levers could work dependent upon what you may or may not want to do, and depending upon what value you may place on trying to do that particular development.

Next slide.

So looking at hypothetical scenario two in this one, uh it would be that the grocery store study says that there's insufficient URA incentive capacity to attract a downtown grocery store.

So some considerations that may be brought to the board.

This first one has to do with really the marketing pathway and how we can market or change the marketing strategy for a property.

So this is whether to continue requiring a grocery store in future proposals or to open up the broader RFP in order to allow for other types of development.

Um if not, what type of a development would then be uh desirable for site B and Woodfold would be a question that would come to the board.

Um are there other public amenities such as a plaza that would be a condition of uh development?

And if so, which site is best suited?

Um, what types of incentives would the board want to offer?

And is that a sufficient um incentive to require or encourage that kind of development?

So depending on the consideration, there might be other incentives that might be available to finally we want to talk a little bit tonight about marketing and developing properties, knowing that we will be coming back to this conversation pretty thoroughly in our our next work session, but we're hoping that we can get some direction from the board this evening in order so we can do some more work between now and August.

So we know that there are several avenues that exist to market and develop the properties, including development requirements, incentives, whether to package the sites together and separately, um, such as we've listed throughout both of the hypotheticals.

And so we'd like to work to define those pathways available and perhaps get a start on some of those marketing materials.

So some of the options that we've been researching include a notice of site availability, which is an extremely broad opportunity for folks to bid on or propose different concepts for development, an RFQ, which can be kind of an initial strainer for folks who might be best qualified in order to develop the properties within certain requirements of the board, uh request for proposals, which goes somewhere after the ideally would be after an RFQ.

So we've uh strained for uh the best qualified fits, and then we ask them for concepts in the RFP process, and then developing or asking for some marketing assistance in order to develop those marketing materials.

So this includes a detailed offering memorandum that a realtor would help create active marketing through real estate portals, industry context, et cetera, and starting to do some site tours or a combination thereof.

Um so what we would like to hear from the board tonight is if any is if it's getting past nine o'clock.

Um we'd like to hear is if there is uh sufficient desire from the board for us to move forward with starting to work on some of the marketing assistance, particularly around the uh boutique hotel property, as it is the most time sensitive of the properties, and then we can come back with some of that draft marketing material as well as the feasibility study during the August meeting and come forward with more of a pathway to how that property could develop.

I think the only thing I would add um to what Kim was mentioning is that we're kind of in this place of um we kind of one, don't know what we don't know, but two, we're also kind of asking about what's the art of the possible.

Like what is the demand out there?

We don't know all of the conditions of what that demand might be, but is there demand to develop these properties?

And if so, what type of demand may or may that may or may that not be?

So that we can provide the board some additional information.

Part of that analysis is going to be the feasibility studies, develop any potential developers going to look at those feasibility studies, and there's going to be some economic metrics in there and total rate of return, et cetera, about what may or may not be possible, what their debt requirements might be, how long it might take to pay it off, all of those kinds of considerations, what level of mansetta might be necessary.

But we're in this place where in terms of getting some marketing assistance, putting these properties out there and an offering a memorandum is a document that essentially lists out all of the um aspects of the property, very similar to if you were um trying to market your house, I guess, um for lack of a better analogy, but and it would put the acreage, it would put the annual assessment, the taxation, the zoning, potential opportunities, location, it would potentially tell a story about it, but it would get it out into certain kind of development portals that we just are not familiar with and we don't have experience with to begin to kind of define what the art of the possible is for the board.

And because that at this point is we we just don't know what that those possibilities may or may not be uh from a market perspective.

So do you have anything else or can we ask questions?

Uh just a couple last questions.

So in addition to thinking about the marketing assistance, uh, we're also interested if you have any other concepts that you'd like staff to consider behind beyond what you've shared previously, public plaza, grocery store, boutique hotel as we prepare for the August recession.

Okay, great.

Thanks.

Counselor Falkner.

Um I'm I'm I would I can't wait to see the actual analysis.

Um I'm wondering if, you know, kind of similar to my questions to the county.

Um, you know, before we put together, you know, I I would like to see this council have a little bit of a you know, sort of a gut check on you know, what are some of the things that might be, you know, might be contributing to the fact that the boutique hotel needs two million dollars, you know, to make it potentially pencil for them.

And so, you know, are there are there things in our code like the height restrictions, you know, I mean things that are actually preventing, you know, this thing from happening, even though like that's the desires I've heard since before I was on council is that we want this thing to be a boutique hotel.

So, like rather than putting something out there that we know is gonna cost you know us more money because it's gonna be really difficult, you know, if not impossible for a developer to actually make that dream happen.

Will we have an opportunity to assess, hey, maybe the city needs to be the applicant first on some spot zoning changes on I consider that sort of like site preparation work, you know, like is there some work that we need to do in advance to you know make this place more in this isn't just oh, this is not a question just relevant to the theater site.

I'm thinking about site B and I'm also thinking about wood bulb on with it.

So it's not just height restrictions, it's floor area, you know, ratios.

It's it's also height restrictions.

It's anything, you know, all these other things that the city has sort of like encumbered on these sites that make them less attractive and less likely for them to develop into these things that the community says they want.

Um I just want to go, I don't want to put the car, I don't want to see us put something out there that's doomed to fail because we've we haven't assessed whether or not we've actually sort of shot ourselves in the foot, you know.

I think that's kind of the most important thing about getting some sort of realtor or real estate professional on board early is that they'll be able to help us identify if there's areas that make the the uh the property less marketable.

Right.

And so that's something that we can start to work on right away.

Yeah.

Yeah.

For example, if they you know, if it's if it's only three stories and a vertical housing tax credit, you have to have four stories and the code says three, you know, we can look at that as some potential change.

Um, but as I think Kim mentioned, kind of hearing that from the development community, I think would also be very helpful about what some of them encumbrances might be toward redevelopment or development of those properties.

Yeah, like so.

I mean, I'm just saying I don't want to put two million dollars towards something if we could actually save ourselves a million dollars by saying go another go another floor up.

Yeah, I would have some more rooms in there.

Yeah, what I wrote down was that you're looking for the why behind why there's an incentive requirement.

Right.

That's a good point.

Any other questions?

I got a counselor march random question.

Um when it comes to site B, a lot of the issues that run into um the pitch of the property.

Is there anything that the city can do with or the sorry the URA can do to level the uh property out before starting to um advertise it?

I know that that was been a huge issue for the last um last two times that they've come in because of leveling it out was going to be a big issue.

So the answer to that is yes, URA funds can be used for site preparation.

Um and I think it becomes I'm gonna kind of circle back to that that's another one of those things that falls into the category of if a developer comes back and says, you know what, if we were working with a level site, we might feel differently about this particular property.

And then it becomes kind of uh an economic comparison about okay, well, how much does it cost to do some site preck and maybe make it more attractive, and maybe you attract even more proposals, right?

As opposed to making that a requirement of the proposer themselves, and then saying, well, because of that, we're not gonna be interested.

You really need to start with a with a flat parcel.

Those are some of the um attributes, I guess, that we're looking for from the development community um and from some additional marketing to be able to determine how can we incentivize it.

That would be characterized as an incentive, it would just be a site preparation incentive prior to a potential RFP process.

So somehow we'd have to get the information to determine if we want to spend that money prior to an RFP, or do if you do an RFP that is potentially more open and therefore more flexible, and they wouldn't require that, and they would come in and do this.

It's it's it's just there's a lot of variables kind of weigh as part of that process.

So yeah, go ahead.

Well, first of all, I I appreciate the comments that have been shared already.

Those are really super valuable and bundled with uh the path you're on.

I'd become supportive and look forward to the next work session.

I I was just curious, uh it's been a while since the study on converting Pacific and 19th to two-way was brought up and whether that how that factors into you know, like traffic studies and what how a developer would view those properties differently.

And I don't know, I could I don't remember where the alignment was when when we'd when we would hear about that again.

So that was the and this is a study to look at specific returning sections or portions of Pacific and 19th to two-way.

Right, it's decoupling the coupling.

The decoupling the coupling is a good way to put it.

Um, and and there's a lot of the study is not started, but it was included in the budget.

I could um kind of loop back with with uh Greg Robertson, the public works director, and find out more about that and then get back to the board.

Um I I do think if if is there a correlation between the type of street and then potentially the type of development?

Yeah, there can be a correlation there.

Um whether that would turn into a causation at this point, I I don't know that we know that.

That could also be kind of one of those things we may be able to talk to, you know, a realtor and say if this was a mixed use development with commercial and and residential, would a two-way street in front potentially incentivize that, or would it would it disincentivize it?

That could be one of those kind of hypothetical questions we could potentially build into that.

Um because it is it is a study that the city's looking at doing in the future.

So by like what I'm hearing from council and counselors and staff is I think too, as you know, we look at that three-year work plan, is really just trying to get to the root of the things that you know.

This is I think a priority, like developing these properties, and it will help most everything in the 2040 plan.

But then also looking at some of the other action items, and then making sure, you know, with our comprehensive plan or development code, the decoupling, like how can we intentionally be using staff resource time to build these things out at the same time almost, right?

So we are addressing, you know, I think you put it really well with Counselor Falconer statement, the why behind.

Like if we can fix these whys within our work plan and with our city actions, then that's a huge incentive, and hopefully continues to move these bigger projects.

I don't know if I said that correctly, but that's what I was like kind of reflecting and hearing.

Yeah, the whole package.

Yeah.

Um, you know, and just some of your other questions.

Like I am, you know, back in it doesn't matter, but a number of years ago, I was like, oh, we should have buckets, right?

Like we should have this percentage, this budget allocation for transportation for this, for that.

And you know, it's always good just to learn and reflect and think.

But the the reality is in forest growth, our budget's too small to really do that.

Like we wouldn't be able to fund the things we need to fund in the way we should.

We don't have Beaverton's budget.

And so I'm okay as we start progressing with this work.

I'm okay pausing on some of the grant programs, like the storefront, you know what that's not being subscribed to the point it was five years ago, right?

So I think that that's kind of what we have to be flexible with is the ebb and flow of like where our focus is when, because we only have so much so many resources.

We only have so much staff resource, we only have so much money, you know, and then the other thing that I want to just put out there is it's true that people have been talking about a boutique hotel for a really long time and a grocery store for a really long time, but I'm open, like I'm open to any development options.

Um and just because we want this, like doesn't mean other projects won't benefit the community.

And so, you know, I I think back of that the fresh foods and the requirement of affordable housing.

Like we had an affordable housing requirement, and it didn't pencil out, and I think that that was because our scope was too narrow, you know.

Like if I don't learn from the things I've done wrong in the past, then I shouldn't be doing the job.

But so I think too, like I also want to put very publicly say that, you know, sometimes it's better to be very open with that, you know, like hey, I don't know if it's called like the NOSA, like just like, hey, what do you what are your thoughts?

And the fact that now we have two vacant lots, and sometimes it's easier, you know, I would assume I'm not in developing, but like to have more space, and then maybe they can pencil out the financing for two locations instead of just one.

I don't I don't know these things, but what I do know is I'm open to learn and I'm open to find out, and I'm I'm open like we have the foundation, the long-term strategic plan.

As long as we stay true to that, I don't think we should narrow our scope so too much.

And I think a lot of the intent of this work session was to kind of illustrate those interrelationships and then just kind of get the board thinking about what those might be because it's starting to get to that point where there'll be enough information where I think the board can start looking at what the preferences may be.

Cool.

Do you need anything more from us?

No, I think we've got the direction that we need uh to make sure that we have a really productive work session in August.

Does the board have any other comments or any okay?

Well, thanks for a great meeting.

Thank you, thank you.

Thank you.

I don't even know.