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2025-26-Minutes for Meeting December 11,2024 Recorded 1/24/2025BOARD OF COMMISSIONERS 1300 NW Wall Street, Bend, Oregon (541) 388-6570 Steve Dennison, County Clerk Commissioners' Journal Recorded in Deschutes County CJ2025-26 01/24/2025 4:15:17 PM 1111 11 I II 1111 I 1111111 FOR RECORDING STAMP ONLY BOCC MEETING MINUTES 9:00 AM WEDNESDAY December 11, 2024 Barnes Sawyer Rooms Live Streamed Video Present were Commissioners Tony DeBone and Phil Chang. Also present were County Administrator Nick Lelack, Senior Assistant Legal Counsel Kim Riley and BOCC Executive Assistant Brenda Fritsvold. This meeting was audio and video recorded and can be accessed at the Deschutes County Meeting Portal webpage www.deschutes.org/meetings. CALL TO ORDER: Acting Chair DeBone called the meeting to order at 9:00 am and noted the excused absence of Commissioner Adair. CITIZEN INPUT: • Carl Shoemaker commented on 'The Dream Time" in early human history when religion had not yet been conceived of. • Ron Boozell spoke to the subject of fireworks, sharing that because he is not a fan of prohibition, he did not support Board discussion about banning or not banning fireworks as important decisions like this should be made by voters. Adding that all residents of Deschutes County are concerned about fire danger and persons who have recently consumed alcohol should not light explosives near their neighbor's homes, he suggested that the County require and issue high -cost permits for one- time fireworks use to allow those who want to set off fireworks the option of doing so. BOCC MEETING DECEMBER 11, 2024 PAGE 1 OF 6 i Commissioner Chang recalled that a few years ago, the County Forester reported that ignitions started by fireworks happen most often within Bend's city limits. CONSENT AGENDA: Before the Board was consideration of the Consent Agenda. 1. Approval of Resolution No. 2024-056 to add 1.0 Onsite Wastewater Specialist FTE and transfer appropriations in the Community Development Department 2. Approval of Resolution No. 2024-057 to add 1.0 regular full-time Behavioral Health Specialist II FTE, adopt a supplemental budget and increase appropriations in the Health Services Fund 3. Approval of Resolution No. 2024-058 to extend a .10 Limited Duration District Attorney FTE by one year and transfer appropriations within the Sheriff's Office 4. Approval of a facilities easement agreement to Cascade Natural Gas 5. Consideration of Board signature on letters thanking Larry Bartlemay and appointing Crystal Clute for service on the Pinewood Country Estates Special Road District 6. Consideration of Board signature on letters thanking Carly Sanders and reappointing Lauren Kellogg and Peggy Kellogg for service on the OSU Extension 4-H Advisory Council CHANG: Move to approve the Consent Agenda as presented DEBONE: Second VOTE: CHANG: Yes DEBONE: Acting Chair votes yes. Motion Carried 2 - 0 ACTION ITEMS: Item 8. was taken before item 7. 8. Sheriffs Office Request for Opioid Settlement Funds Captain Michael Shults of the Sheriffs Office reminded that Deschutes County is expected to receive about $7.9 million over 18 years from the nationwide settlement which resolved all opioid claims brought by states and local governments. While to date, the Sheriffs Office (DCSO) has not requested any of these funds, DCSO is at this time requesting $283,000 for the jail's Medication Assisted Treatment (MAT) program. These funds would be used to pay for BOCC MEETING DECEMBER 11, 2024 PAGE 2 OF 6 medication and to support the cost of one Registered Nurse. If approved, the funds would ensure the operation of the MAT program through June 30, 2025. In response to Commissioner Chang, Cam Sparks, Budget & Financial Planning Manager, said approximately $1.6 million of opioid settlement funds are currently available to the County beyond the $786,000 already allocated to Health Services and the $50,000 appropriated to Community Justice. Discussion ensued of medications which can reduce cravings in opioid-addicted persons. Eden Aldrich, DCSO Medical Director, said because oral medications can be diverted from persons they are intended for, it's preferred to use long -acting injectable medications which have the secondary benefit of building up in a person's body over time, thereby greatly reducing the chance of someone overdosing if they consume opioids soon after being released from jail. Commissioner DeBone expressed his support for this request and noted the County's partnership with Ideal Options to treat persons with opioid-use disorder. CHANG: Move approval of the requested use of $283,000 in opioid settlement funds by the Sheriffs Office for the MAT program DEBONE: Second VOTE: CHANG: Yes DEBONE: Acting Chair votes yes. Motion Carried 2 - 0 7. Property tax exemption application for the Huntington Apartments at 51771 Huntington Road in La Pine Nick Lelack, County Administrator, introduced the matter of an application for a property tax exemption for an affordable housing development in La Pine. McKenzie Dibble from DANCO Communities said the proposal is to develop 60 units on 4.7 acres at 51771 Huntington Road. Dibble reported that this proposal was approved by the Bend -La Pine School District yesterday and has been approved by various other taxing districts as well. With respect to the timeframe for the property tax exemption, George Schmidbauer, speaking for the applicant, confirmed that the developer seeks a 20-year property tax exemption as allowed under Oregon state law. Robert Tintle, Chief Financial Officer, said if the proposal is approved and the development constructed, the affected taxing districts of the County would forgo BOCC MEETING DECEMBER 11, 2024 PAGE 3 OF 6 a total of $598,000 in property taxes over 20 years. In year 21, the County's taxing districts would together collect about $41,000. Commissioner Chang stated his understanding that it can be hard to develop affordable housing without some subsidy. Noting that when approached with this type of request, the County is typically provided with financials which show that a project would not be viable without a property tax exemption, he asked if such a review has been conducted by an outside third party in this case. Schmidbauer replied that the city undertook a significant review of this project over many months. He depicted this kind of property tax exemption as standard and said if a project cannot get one, the development often cannot move forward. Commissioner Chang appreciated hearing that the City of La Pine conducted due diligence on this request and said he would like to see specific numbers for this project. In response to Commissioner Chang, Dibble said the long-term affordability of these units would be ensured via a 55-year deed restriction. She added that rents will be set to be affordable to those earning 60% or lower of AMI. CHANrz: Move to approve the annliratinn from flan.. rnmm"inities fnr a property tax exemption relating to the Huntington Apartments at 51771 Huntington Road in La Pine DEBONE: Second VOTE: CHANG: Yes DEBONE: Acting Chair votes yes. Motion Carried 2 - 0 The Commissioners expressed appreciation for this development which will result in affordable housing. 9. Shepherd's House grant agreement for use of ARPA funds Laura Skundrick, Management Analyst, reminded of the Board's decision last month to allocate $225,000 in general funds for Shepherd's House to expand its program which houses women and children and said Shepherd's House has proposed to use these funds to support the purchase of a one -bedroom home for this program. Subsequent to the Board's decision to allocate funds for this purpose, County Legal has advised that the Board consider options to ensure the continued use of the property for the described use —this might be done via a deed restriction or by granting the County a reversionary interest in the property BOCC MEETING DECEMBER 11, 2024 PAGE 4 OF 6 if it were to cease being utilized for the stated purpose within a specified time period. Jerry Kaping from Shepherd's House said the organization supports having a deed restriction placed on the property as described. In response to Commissioner DeBone, Kaping said Shepherd's House is scheduled to close on the property this Friday. Responding to Commissioner Chang, Kaping said the property is being purchased for $275,000, of which $225,000 is being provided by the County. Nick Lelack, County Administrator, said Commissioner Adair has indicated she would support a ten-year deed restriction or other option to ensure this property is used for the stated purpose over that period of time. Commissioners DeBone and Chang both stated their support for a ten-year deed restriction as discussed. CHANG: Move to require a ten-year deed restriction be placed on property purchased by the Shepherd's House using $225,000 in County - granted funds to ensure the property is used to house women and children for at least ten years DEBONE: Second VOTE: CHANG: Yes DEBONE: Acting Chair votes yes. Motion Carried 2 - 0 Saying that Shepherd's House has been a community leader in offering housing to those who need shelter, Commissioner Chang asked that an update be provided on this project in one year. OTHER ITEMS: • Commissioner Chang reported on last week's Outdoor Recreation Summit in Sunriver. • Commissioner Chang attended the City Club forum on the potential purchase by a local group of the Mount Bachelor ski facility. • Commissioner Chang attended the Oregon Business Plan Summit on Monday. • Commissioner DeBone announced he will travel to Salem this afternoon for legislative days tomorrow. • Commissioner DeBone reported that La Pine High School's CTE program is seeking additional resources. BOCC MEETING DECEMBER 11, 2024 PAGE 5 OF 6 • Commissioner DeBone said Representative Cliff Bentz's office has suggested that the Board submit a letter of support for legislation which would authorize the transfer of 40 acres of land in the Deschutes National Forest southeast of La Pine to the County. In response to Commissioner Chang, Commissioner DeBone said the land would be transferred free of charge to Deschutes County for the`purpose of economic development. The intention would be for the County to sell the property on the open market. Commissioner DeBone added that this land is co -located with a different private property which has been mined for minerals for many years. Commissioner Chang objected that this proposal would amount to the federal government giving away a resource at no cost, and preferred that the County. purchase the land outright or exchange it for another property such as wetlands owned by the County within the floodplain of the Little Deschutes. He stated his interest in learning more about this proposal and why the Forest Service does not simply lease this land for mineral extraction. Commissioner DeBone alluded to the substantial history of this parcel and said the adjacent property owner has been told there is no path to access it while it is under federal ownership. EXECUTIVE SESSION: None ADJOURN: Being no further items to come before the Board, the meeting was adjourned at 9:55 am. DATED this ) day of Commissioners. ATTEST: 4?1reft&h 1'y4( RECORDING SECRETARY BOCC MEETING ao 2-3 2-Efor the Deschutes County Board of PA TI ADAIR, CHAIR ANTHONY DEBONE, VICE CHAIR PHIL CHANGcC'OMMISSIONER DECEMBER 11, 2024 PAGE 6 OF 6 BOARD OF COMMISSIONERS BOARD OF COUNTY COMMISSIONERS MEETING 9:00 AM, WEDNESDAY, DECEMBER 11, 2024 Barnes Sawyer Rooms - Deschutes Services Building - 1300 NW Wall Street - Bend (541) 388-6570 I www.deschutes.org AGENDA MEETING FORMAT: In accordance with Oregon state law, this meeting is open to the public and can be accessed and attended in person or remotely, with the exception of any executive session. Members of the public may view the meeting in real time via YouTube using this link: http://bit.ly/3mminzy. To attend the meeting virtually via Zoom, see below. Citizen Input: The public may comment on any topic that is not on the current agenda. Alternatively, comments may be submitted on any topic at any time by emailing citizeninput@deschutes.org or leaving a voice message at 541-385-1734. When in -person comment from the public is allowed at the meeting, public comment will also be allowed via computer, phone or other virtual means. Zoom Meeting Information: This meeting may be accessed via Zoom using a phone or computer. • To join the meeting via Zoom from a computer, use this link: http://bit.ly/3h3ogdD. • To join by phone, call 253-215-8782 and enter webinar ID # 899 4635 9970 followed by the passcode 013510. • If joining by a browser, use the raise hand icon to indicate you would like to provide public comment, if and when allowed. If using a phone, press *9 to indicate you would like to speak and *6 to unmute yourself when you are called on. • When it is your turn to provide testimony, you will be promoted from an attendee to a panelist. You may experience a brief pause as your meeting status changes. Once you have joined as a panelist, you will be able to turn on your camera, if you would like to. Deschutes County encourages persons with disabilities to participate in all programs and activities. This event/location is accessible to people with disabilities. If you need accommodations to make participation possible, call (541) 388-6572 or email brenda.fritsvold@deschutes.org. Time estimates: The times listed on agenda items are estimates only. Generally, items will be heard in sequential order and items, including public hearings, may be heard before or after their listed times. CALL TO ORDER PLEDGE OF ALLEGIANCE CITIZEN INPUT: Citizen Input may be provided as comment on any topic that is not on the agenda. Note: In addition to the option of providing in -person comments at the meeting, citizen input comments may be emailed to citizeninput@deschutes.org or you may leave a brief voicemail at 541.385.1734.. CONSENT AGENDA 1. Approval of Resolution No. 2024-056 to add 1.0 Onsite Wastewater Specialist FTE and transfer appropriations in the Community Development Department 2. Approval of Resolution No. 2024-057 to add 1.0 regular full-time Behavioral Health Specialist II FTE, adopt a supplemental budget and increase appropriations in the Health Services Fund 3. Approval of Resolution No. 2024-058 to extend a .10 Limited Duration District Attorney FTF by nne year and trancfPr annrnnriatinn' within the chPriff'c nffirP 4. Approval of a facilities easement agreement to Cascade Natural Gas 5. Consideration of Board signature on letters thanking Larry Bartlemay and appointing Crystal Clute for service on the Pinewood Country Estates Special Road District 6. Consideration of Board signature on letters thanking Carly Sanders and reappointing Lauren Kellogg and Peggy Kellogg for service on the OSU Extension / 4-H Advisory Council ACTION ITEMS 7. 9:05 AM Property tax exemption application for the Huntington Apartments at 51771 Huntington Road in La Pine 8. 9:30 AM Sheriff's Office Request for Opioid Settlement Funds 9. 9:45 AM Shepherd's House grant agreement for use of ARPA funds December 11, 2024 BOARD OF COUNTY COMMISSIONERS MEETING Page 2 of 3 OTHER ITEMS These can be any items not included on the agenda that the Com,nissioners wish to discuss as part of the meeting, pursuant to ORS 192.640. EXECUTIVE SESSION At any time during the meeting, an executive session could be called to address issues relating to ORS 192.660(2)(e), real property negotiations; ORS 192.660(2)(h), litigation; ORS 192.660(2)(d), labor negotiations; ORS 192.660(2)(b), personnel issues; or other executive session categories. Executive sessions are closed to the public; however, with few exceptions and under specific guidelines, are open to the media. ADJOURN December 11, 2024 BOARD OF COUNTY COMMISSIONERS MEETING Page 3 of 3 Subject: BOARD OF COMMISSIONERS' MEETING REQUEST TO SPEAK Citizen Input or Testimony kr? D ir4P !A hn -hike Name c sj Address 3 12 NE 5-th 5t, hcd GR '?77 Phone #s Date: E-mail address In Favor Neutral/Undecided Opposed Submitting written documents as part of testimony? Yes ig No If so, please give a copy to the Recording Secretary for the record. SUBMIT COMPLETED REQUEST TO RECORDING SECRETARY BEFORE MEETING BEGINS Subject: Name Address BOARD OF COMMISSIONERS' MEETING REQUEST TO SPEAK Citizen Input or Testimony Date: Phone #s E-mail address avor SubmittingIACe ell w itten doc ments as pantie t imony? Yes If so, please give a copy to the Recording Secretary for the record. 'CO SRM 19 C0 rn Neutral/Undecided va-e\iQra sm4 f coisT 0outr4-\:\p �bl�cSa+eiisa aecti��rJ.SUBMIT COMPLETED REQUEST TO RECORDING SECRETARY BEFORE MEETING BEGINS cf‘,(.5\ftorc Cnon&lLy �✓ �f�e. CDA� Opposed No BOARD OF COMMISSIONERS AGENDA REQUEST & STAFF REPORT MEETING DATE: December 11, 2024 SUBJECT: Property tax exemption application for the Huntington Apartments at 51771 Huntington Road in La Pine RECOMMENDED MOTION: Consider the application from Danco Communities for a property tax exemption relating to the Huntington Apartments at 51771 Huntington Road in La Pine. BACKGROUND AND POLICY IMPLICATIONS: ORS 307.515 and ORS 307.518 allow for property tax exemptions for certain rental housing developments serving low-income households. The Huntington Apartments project proposes a 60-unit affordable housing development which will offer apartments for rent to persons earning at or below 60% of the area median income (AMI). This project is utilizing the Oregon Affordable Housing Tax Credit Program, which allows the rents to drop closer to 50% AMI levels while keeping the income threshold at 60% AMI. The development will consist of nine two-story buildings on 4.7 acres. All utilities will be paid by the property owner, and Neighborlmpact will provide a wide range of resident services focusing on adult and child education, financial literacy and stability, and health and wellness. The Latino Community Association is also a partner in this project. All of the value captured by the tax exemption would be passed through to rent reductions, allowing the project to offer new class A apartments at or below 60% AMI rent levels. According to information submitted by the applicant, a property tax exemption for the property and future improvements is a critical piece of the affordable housing finance structure that would make this project feasible to develop. The net operating income is at the minimum allowed by lenders, and would result in a debt service coverage ratio of 1.20. The property tax exemption is required to maintain this underwriting standard and project viability. The property will be owned by La Pine Huntington Road LP, of which Engage NW is the managing general partner. Engage NW is a 501(c)3 non-profit organization whose mission is to support affordable housing developments with administrative and resident services work. In order for this project to qualify for the tax exemption, it must be approved by the boards which represent at least 51 % of the combined levy of taxing districts. Thus far, this application has been approved by the Deschutes County Library District, COCC, the La Pine Park & Recreation District, High Desert Educational Service District and the La Pine Rural Fire District. The application will be presented to the Bend -La Pine School District on December 10tn BUDGET IMPACTS: This project is estimated to receive a total 10-year tax exemption of approximately $948,500 based on an estimated building value of $12.8 million. Total tax collection for the 10-year exemption period of the site will be about $24,900 if the project is not constructed. The table below demonstrates the tax collection that would take place on the site in year 11, after the exemption period in both a no -build and build scenario of the project. The table demonstrates the tax benefits to all districts starting in Year 11 if this project is approved and moves forward. Forecasted Tax Collection by Taxing District in Year 11 No Proposed %of Tax Project is Project is Taxing District Levy` Built Built Deschutes County Countywide Law Enforcement N.Iral Law Olforcelllelllt County Extension/4H 9-1-1 Deschutes County Total 7.7% $ 225 $ 8,808 7.5% 220 8,613 A Ao/ ')7') 4/1 am-1 J.Y/o G/J IV,VIJ 0.1% 4 155 2.2% 64 2,494 26.9% 785 30,748 Bend La Pine School District** 40.0% 1,165 45,630 O ty of La Fine 20.1% 587 22,971 COCC 4.3% 125 4,898 County Library 5.4% 157 6,144 Dept of Forestry Fire Patrol 0.9% 25 987 High Desert FAD** 0.6% 17 665 La Fine Park & Ibcreation 1.8% 53 2,067 Other District Total 73.1% 2,129 83,363 Grand Total 100.0% $ 2,914 $114,111 * These tax collection percentages incl ude division of taxes and local levies. * * * * The Bend/La Hne School District and the High Desert Education Service District are funded though per pupil allocations from the Sate School Fund which is comprised ofmanysources, includingpropertytaxrevenues. The State Legislature setsthe per pupil allocations and funds the Sate School Fund accordingly. Therefore, tax exemptions have an "indirect" impact on the funding for local districts. Tax exemptionsthrougfioutthe state all have an impact on the Sate School Fund. ATTENDANCE: Nick Lelack, County Administrator DANCO THE DANCO GROUP OF COMPANIES Danco Communities Phone:(707) 822-9000 Fax: (707)8229596 www.danco-erouo.com December 3, 2024 Deschutes County Board of County Commissioners Commissioner Patti Adair, Chair Commissioner Tony DeBone, Vice Chair Commissioner Phil Chang 5251 Ericson Way Arcata, CA 95521 RE: La Pine Huntington Road Limited Partnership Request for Approval of NONPROFIT TAX EXEMPTION Application for the Project at 51771 Huntington Road, La Pine OR To the Deschutes County Board of County Commissioners: In accordance with City of La Pine Resolution 2023-09 and Resolution 2024-01, Danco Communities and La Pine Huntington Road Limited Partnership are applying for the Nonprofit Property Tax Exemption for the property at 51771 Huntington Road, La Pine, OR. The Partnership is currently under construction on a low-income tax credit project on this site. The project is comprised of 60 family units of unit sizes between 1 and 3 bedrooms and AMI levels of 60%. The project will support local families in need of clean, safe housing at a level of affordability that is suitable for their income. The Partnership is a tax-exempt entity as its managing general partner is EngAGE La Pine LLC, whose sole member/manager is EngAGE Northwest which is a 501(c)3 non-profit corporation. The administrative general partner is an entity related to Danco Communities, an experienced developer with 38 affordable housing projects developed. EngAGE Northwest is an organization specializing in creating community for all ages through their intergenerational and art -focused programing in affordable housing projects and beyond. EngAGE Northwest takes a whole -person approach to creative, healthy living by providing high quality arts, wellness, and lifelong learning programs to residents of all ages in affordable housing communities. Classes are professionally led and complemented by community -building activities and celebrations as well as intergenerational connections. EngAGE Northwest was founded in 2016 after community members and local developers sought to bring the award -winning resident services model created by EngAGE, Inc. (southern California), to the Pacific Northwest. EngAGE was founded in 1999 and is consistently recognized as a leader in the arts, intergenerational programs, and community -building work. EngAGE serves thousands of residents of all ages. The project will have ongoing resident services offered by the local organizations Neighborlmpact and Lal7no Community Association. Danco Communities is based in Humboldt County CA, and was started in 1986 as a small construction company. Over time the business grew to encompass development, construction, and property management. Danco Communities has been developing affordable housing projects for almost 20 years, DANCO THE DANCO GROUP OF COMPANIES Danco Communities Phone:(707) 822-9000 Fax: (707)8229596 www.danco-eroun.com 5251 Ericson Way Arcata, CA 95521 which started from the local need for affordable housing in the North Coast region. Danco has since completed over 1500 affordable units and maintained a great majority under property management. It is Danco Communities' mission to bring safe, affordable, and inspiring housing to our communities. The Partnership is requesting your support for our Nonprofit Tax Exemption Application for this low- income property which will consist in 60 units of housing, 59 of which will be affordable at or below 60% AMI to serve the rapidly growing rural community in Deschutes County. All funds not paid in taxes will benefit our tenants by being applied to maintaining low rents, property maintenance, and continued provision of a robust supportive services program. Sincerely, Daniel J. Johnson President, Danco Communities Application for Property Tax Exemption Applicant name: Danco Communities Applicant address: 5251 Ericson Way Ste A, Arcata, CA 95521 Email: mdibble@danco-group.com Phone: 707-672-4002 Project Name: Huntington Apartments Project Location: 51771 Huntington Rd. La Pine, OR 97739 Developer and Administrative General Partner: Danco Communities General Contractor: Danco Builders Property Manager: Danco Communities Managing General Partner: Engage NW Resident Services Provider: Neighborlmpact & Latino Community Association Funding Agency: Oregon Housing and Community Services A subsidiary of Danco Homes, LLC dba Danco Communities, a private entity, proposes to purchase the property and construct an affordable housing development. The project is referred to as Huntington Apartments. 1. A description of the property or a portion of the property for which the exemption is requested; Huntington Apartments is an affordable housing development located in La Pine, OR. The project will deliver 60 units for rent to persons earning at or below 60% of the area median income (AMI). This project is utilizing the Oregon Affordable Housing Tax Credit Program (OAHTC), which allows the rents to drop closer to 50% AMI levels, while keeping the income threshold at 60% AMI. The development will consist of nine 2-story buildings, spanning the entirety of the 4.7-acre parcel. The garden style community will provide a community building, resident service program rooms, community gardens, tot lot, sport court, and ample parking. With Danco's expertise in sustainable development, this project will include the latest in sustainable building tech and practice, allowing ownership to pay all utilities for the future residents. We have partnered with Neighborlmpact to provide a wide range of resident services at the property, focusing on adult and child education, financial literacy and stability, and health & wellness. Neighborlmpact will work with the Latino Community Association, a local non-profit dedicated to serving Latino families in Central Oregon, in an effort to make the community program culturally relevant to all. Unit Mix: 1 Bedroom- 16 2 bedroom- 24 3 bedroom- 20 Total- 60 Schedule: OHCS Closing: 10/25/23 Construction Start: 11/1/23 Construction Finish: 6/1/25 Stabilization: 9/1/25 Page 1 — Application for Property Tax Exemption 2. A description of the purpose of the project and whether all or a portion of the property is being used for that purpose; The purpose of the Huntington Apartments project is to provide a quality living environment for low-income individuals and families in a region that has experienced rapid increases to the cost of living. We hope that the use of the OAHTC rent reduction and owner paid utilities will further reduce the burden of living in Central Oregon. The resident services plan developed by Neighborlmpact and Latino Community Association will provide essential services tailored to the resident's specific needs. The ongoing resident services will help residents integrate into the surrounding community, connect to additional support networks, and become a contributing member of the La Pine community. 3. A certification of income levels of low income occupants; Not applicable for new construction projects. See OHCS award letter for future requirements. 4. A description of how the tax exemption will benefit project residents; Property tax exemption for the property and future improvements is a critical piece of the affordable housing finance structure that makes this project, and many like it, feasible to develop. The Net Operating Income (N01) is at the minimum allowed by lenders in the space, making for a debt service coverage ratio (DSCR) of 1.20. The property tax exemption is required to maintain this underwriting standard and project viability. Given this current state, all of the value captured by the property tax exemption will be passed through to rent reductions, allowing the project to offer new class A apartments at or below 60% AMI rent levels. 5. If the exemption is an exemption described in ORS 307.518 (Alternative criteria for exemption), evidence satisfactory to the governing body that the corporation is a nonprofit corporation and meets the criteria for a public benefit corporation or a religious corporation; The property will be owned by La Pine Huntington Road LP, of which Engage NW is the Managing General Partner. Engage NW is a 501(c)3 non-profit organization whose mission is to support affordable housing developments with administrative and resident services work. See attached Certificate of Limited Partnership and Agreement of Limited Partnership. 6. A description of the plans for development of the property if the property is being held for future low-income rental housing development; and See question 1. An exemption is being requested for the entire property to be developed. Page 2 — Application for Property Tax Exemption 7. A description of how the applicant and the property, respectively, meet any additional criteria adopted by the governing body pursuant to ORS 307.517 (Criteria for exemption) (2) or 307.518 (Alternative criteria for exemption) (2). No additional criteria have been adopted for this project. If and when any are adopted, we will supplement this Application with a response to each additional criteria. Page 3 — Application for Property Tax Exemption I► O v.v® Or•10B m LA PINE OR EGON November 21, 2024 Deschutes County Board of Commissioners 1300 NW Wall Street Bend, Oregon 97703 Dear County Commissioners, CITY OF LA PINE 16345 Sixth Street — PO Box 2460 La Pine, Oregon 97739 TEL (541) 536-1432 — FAX (541) 536-1462 www.lapineoregon.gov On March 29, 2024, City of La Pine staff presented to the Board of County Commissioners that the City would be considering a Low -Income Rental Housing Tax Exemption to support existing and planned affordable housing developments. Oregon's legislature enacted the Low -Income Rental Housing Tax Exemption in 1985 (ORS 307.515 — 307.523) to benefit low-income renters by easing property tax burden on those organizations providing affordable rental housing. The City Council adopted by resolution its "Policy on Low -Income Rental Housing Tax Exemption" under La Pine Resolution No. 2023-09, "A RESOLUTION OF THE LA PINE CITY COUCIL ADOPTING THE PROVISINS OF OREGON REVISED STATUTE 307.515 TO 307.523 ALLOWING PROPERTY TAX EXEMPTION FOR LOW-INCOME RENTAL HOUSING" with applications being eligible for exemptions for tax years beginning on or after July 1, 2023.Under La Pine Resolution 2023-09, an organization meeting the criteria for exemption under the "Policy on Low -Income Rental Housing Tax Exemption", and ORS 307.515 to ORS 307.523, may apply for a property tax exemption for affordable housing developments, including bare land holding intended to be developed into affordable housing which must commence construction within twelve months of the day of exemption approval provided by the City of La Pine and receive any and all final inspections for, public improvements, conformance with building, electrical, structural, or plumbing code and all other final occupancy certificates and be habitable no later than eighteen months from the day of exemption approval . The qualified housing must be limited to households at 60 percent Area Median Income (AMI) or less. If approved by 51 percent of the taxing districts, then the exemption applies to 100 percent of the property taxes. The required Low -Income Rental Housing Tax Exemption application must be filed on or before March 1. Within 60 days of the applications filing, City Council must determine whether the applicant meets the requirements under La Pine Resolution 2023-09 and its associated policy. If the applicant meets the requirements, then the City will bring the property tax exemption before the County Assessor and certify the property is exempt from property taxation by the April 1 deadline pursuant to ORS 307.515 — 307.523. The City of La Pine has received an application for a Low -Income Rental Housing Tax Exemption from La Pine Huntington Road Limited Partnership. The Partnership is a tax-exempt entity as its managing general partner is EngAGE La Pine LLC, whose sole member/manager is EngAGE Northwest, an Oregon 501(c)3 non-profit corporation. The Partnership is currently under construction on a low-income tax credit project comprised of 60 family units of unit sizes between 1 and 3 bedrooms and AMI levels of 60%. On March 27, 2024, the City of La Pine approved Resolution No. 2024-01, providing conditional approval of the Low -Income Rental Housing Tax Exemption from La Pine Huntington Road Limited Partnership. This project is estimated to receive a total 20-year tax exemption of approximately $2,223,282 based on an estimated building value of $12.8 million. Total tax collection for the 20-year exemption period of the site will be about $58,255 if the project is not constructed. The table below demonstrates the tax collection that would take place on the The City of La Pine is an equal opportunity provider site in year 21, after the exemption period in both a no -build and build scenario of the project. The table demonstrates the tax benefits to all districts starting in Year 21 if this project is approved and moves forward. Forecasted Tax Collection by Taxi ng District in Year 20 No Proposed %of Tax Project is Project is TaxingDistrict Levy* Built Built Deschutes County Countywide Law Enforcement Rural Law Enforcement County Extension/4H 9-1-1 Deschutes CountyTotal 7.7% $ 7.5% 9.4% 0.1% 2.2% 26.9% 293 $ 8,808 287 8,613 356 10,679 5 155 83 2,494 1,024 30,748 Bend La Pine School District** 40.0% 1,520 45,630 CityofLaPine 20.1% 765 22,971 COCC 4.3% 163 4,898 County Li bra ry 5.4% 205 6,144 Dept of Forestry Fire Patrol 0.9% 33 987 High DesertESD** 0.6% 22 665 La Pine Park& Recreation 1.8% 69 2,067 Other DistrictTotal 73.1% 2,778 83,363 Grand Total 100.0% $ 3,802 $ 148,888 *These tax collection percentages include divis ion of taxes and local levies. ****The Bend/La Pine School District and the High Desert Education Service District are funded though per pupil allocations from the State School Fund which is comprised of many sources, including property tax revenues. The State Legislature sets the per pupil allocations and funds the State School Fund accordingly. Therefore, tax exemptions have an "indirect" impact on the funding for local districts. Tax exemptions throughout the state all have an impact on the State School Fund. EngAGE Northwest is an organization specializing in creating community for all ages through their intergenerational and art -focused programing in affordable housing projects and beyond. EngAGE Northwest takes a whole -person approach to creative, healthy living by providing high quality arts, wellness, and lifelong learning programs to residents of all ages in affordable housing communities. Classes are professionally led and complemented by community -building activities and celebrations as well as intergenerational connections. EngAGE Northwest was founded in 2016 after community members and local developers sought to bring the award - winning resident services model created by EngAGE, Inc. (southern California), to the Pacific Northwest. EngAGE was founded in 1999 and is consistently recognized as a leader in the arts, intergenerational programs, and community - building work. EngAGE serves thousands of residents of all ages. The project will have ongoing resident services offered by the local organizations Neighborlmpact and Latino Community Association. Danco Communities, the administrative general partner for La Pine Huntington Road Limited Partnership, is based in Humboldt County CA, and was started in 1986 as a small construction company. Over time the business grew to encompass development, construction, and property management. Danco Communities has been developing affordable housing projects for almost 20 years, which started from the local need for affordable housing in the North Coast region. The City of La Pine is an equal opportunity provider Danco has since completed over 1500 affordable units and maintained a great majority under property management. It is Danco Communities' mission to bring safe, affordable, and inspiring housing to our communities. The Partnership requests the Board of County Commissioner's support for its Low -Income Rental Housing Tax Exemption application. All funds not paid in taxes will benefit low-income renters by maintaining low rents, resident services and property maintenance. Please let me know when the Partnership may be able to make such a request to the Board. If you have any further questions, don't hesitate to contact me. Sincerely, Geoff Wullschlager City Manager City of La Pine The City of La Pine is an equal opportunity provider RESOLUTION NO. 2024-01 A RESOLUTION PROVIDING CONDITIONAL APPROVAL OF THE LOW-INCOME RENTAL HOUSING TAX EXEMPTION APPLICATION SUBMITTED BY LA PINE HUNTINGTON ROAD LIMITED PARTNERSHIP AND CERTIFYING TO THE DESCHUTES COUNTY TAX ASSESSOR THAT ALL OF THE PROPERTY TAX FOR THE PERIOD OF 2025-2045 TAX YEARS SHALL BE EXEMPT FROM THE AD VALOREM TAX LEVY OF THE CITY OF LA PINE UPON PASSAGE WHEREAS, in accordance with ORS 307.515 - ORS 307.523, and in an effort to provide a mechanism through which the La Pine City Council can contribute to and support the development of low- income rental housing in La Pine, the City of La Pine established procedures to provide a property tax exemption for qualifying low-income rental housing by its adoption of Resolution No. 2023-09 (the "Tax Exemption Program"); and WHEREAS, on December 26, 2023, the La Pine Huntington Road Limited Partnership, an Oregon domestic limited partnership (the "Partnership"), whose principal address is 17890 SW Elsner Rd, Sherwood, OR 97140 and mailing address is 5251 Ericson Wy, Arcata, CA 95521, submitted an application under the Tax Exemption Program for a low- income rental housing tax exemption for 2025-2045 tax years; and WHEREAS, the Partnership's application for exemption concerns a certain 60-unit affordable apartment complex commonly known as the La Pine Apartments (the "Apartment Complex"), which Apartment Complex is under construction on certain real property located at 51761 Huntington Rd., La Pine, Oregon 97739, more particularly described as follows: Lot 100 of Newberry Neighborhood 1, recorded in Deschutes County on October 15, 2003, and listed as Map and Taxlot: 221011 CB00100 of Deschutes County, Oregon; referred herein to as the "Property"; and WHEREAS, pursuant to ORS 307.523 and the Tax Exemption Program, the City Council must adopt a resolution or ordinance approving or denying the Partnership's application for exemption within 60 days of the time of filing; and WHEREAS, pursuant to ORS 307.523 the tax exemption has been approved pursuant to an application filed before July 1, 2030; and WHEREAS, the housing units on the property were constructed after the local governing body adopted the provisions of ORS 307.515 307.523; and WHEREAS, the City Council for the City of La Pine has reviewed the Partnership's application and made findings attached in Exhibit A., and has determined that, subject to the terms and conditions provided below, the Apartment Complex and Property are eligible for tax exemption under the Tax Exemption Program; and WHEREAS, the City Council for the City of La Pine does hereby certify to the Deschutes County Tax Assessor that all of the property tax for the period of 2025-2045 tax years shall be exempt from the ad valorem tax levy of the City of La Pine upon passage of this resolution. NOW, THEREFORE, BE IT RESOLVED, by and through the City Council for the City of La Pine, the following: Resolution 2024-01 1. The City Council approves the Partnership's application for the Apartment Complex and Property's tax exemption for the 2025-2045 tax years subject to the following conditions: (a) The Partnership's payment of the $1,000.00 Low -Income Rental Housing Tax Exemption (LIRHTE) Application fee established by the City under Resolution 2023-09. (b) The Partnership's payment of the $5,977.00 legal fees associated with review of the proposal and application established by the City under the City of La Pine Master Fee Schedule and Resolution 2023-10. (c) The Partnership's payment of the $123,764.94.00 Community Contributions established by the City under Resolution 2023-09 and the associated Policy on Low -Income Rental Housing Tax Exemption. (d) The Partnership's completion of construction of the Apartment Complex on or before June 30, 2025. The Apartment Complex's construction will be deemed complete upon Deschutes's County's issuance of a Certificate of Occupancy. (e) This conditional approval is made subject to any and all applicable laws, rules, regulations, ordinances, and resolutions concerning or related to the Tax Exemption Program, including, without limitation, ORS 307.15 — ORS 307.523. (f) The Partnership's signing all other documents and taking all other actions the City determines reasonably necessary to approve the Partnership's application for tax exemption. APPROVED, ADOPTED, AND MADE EFFECTIVE by the La Pine City Council on this 27th day of March 2024. A EST: manda Metca , City Reco der Resolution 2024-01 aniel Richer, Mayor EXNIBIT A. ®LA PINE LIRHTE Application Report 03/20/24 Applicant: La Pine Huntington Road Limited Partnership CITY OF LA PINE 16345 Sixth Street — PO Box 2460 La Pine, Oregon 97739 TEL (541) 536-1432 — FAX (541) 536-1462 www.lapineoreaon,aov Persons seeking tax exemption for eligible property shall submit an application on a form provided by the City of La Pine and pay the fee established by the City Council and set forth in the City of La Pine fee resolution. The application shall contain the following information: • • • A. The applicant's name. address, and telephone number, Applicant Name: La Pine Huntington Road Limited Partnership Applicant Address: 5251 Ericson VVy. Arcata, CA 95521 Applicant Telephone Number: (707)822-9000 B. A legal description of the property for which the exemption is requested' Deschutes County Assessor Map: Section 11., Township 22S., Range 10E., Lot 100. 221011C000100 C. If onlya portion of the property is eligible. a des iotion of the eligible portion of the prnneftu for which the g, emntion js requested. includina the number of affordable housing units; 59 units are participating. The one remaining unit will be offered rent free to the onsite manager, 0, A description of the purpose of the project and whether all or a portion of the property Is being used for that purpose; The purpose is defined in detail, including unit count, financial qualifications for access, the policy/program being used to make the program financially feasible, in addition to specific details as to site design and development. g. A certification of income levels of low-income occupants' Provided, 80% AMI for qualification, and an estimate of intent to position rents closer to 50% AMI. f . A description of how the tax exemption will benefit oroiect residents: This is provided in the statement of qualification and estimated rent levels. G A description oflhe plans for development an conformance with Section 4.1 I.) of the property if the property is being held for future rental housing development: The property has been approved through La Pine Community Development and Deschutes County Community Development, respectively. The applicant has also provided the following schedule: a. OHCS dosing: (10/25/23 b. Construction start: (11/01/23) c. Construction finish: (08/01/25) d. Stabilization: (09/01/25) H A list of secured lienholders with addresses of the lienhoiders; The City of La Pine is an equal opportunity provider Resolution 2024-01 a. Oregon Housing and Community Services Department — 725 Summer St., NE, Ste. B. Salem, OR 97301 b. Oregon State Treasury — 867 Hawthorne Ave. SE. Salem. OR 97301 c. Umpqua Bank — One SW Columbia St., Ste. 1170 Portland, OR 97258 I. A burden of proof statement demonstratina how the applicant has met the criteria as established in Section 4. of this policy A. The property is: Offered for rent B. The property, if occupied, is occupied solely by low-income persons with non -material exceptions.: The property is under construction and will only be occupied by low-income persons when completed. C. The required rent payment reflects the full value of the property tax exemption.: Property tax exerption for the property and future improvements is a critical piece of the affordable housing finance structure that makes this project, and many like it, feasible to develop. The Net Operating Income (NOI) is at the minirnum allowed by lenders in the industry, making for a debt service coverage ratio (DSCR) of 1.20. The property tax exemption is required to maintain this underwriting standard and project viability. Given this current state, all of the value captured by the property tax exemption will be passed through to rent reductions. allowing the project to offer new class A apartments at or below 60% AMI rent levels Units Monthtyexpenseat100ViAM1(Forecasted as140%of60%)Mandy yield Annual Yield 1 bedroom 16_ $ 1,268.40 $ 20,294.40 $ 24 ,,532.80, 2 bedroom 23 $ 1,520.40 $ 34,969.20 $ 419,630.40 3 bedroom 20 $ 1,755.60 $ 35,112.00 $ 421,344.00 Totat 59 $ 4,544.40 $ 90,375.60 $ 1,084,507.20 Units Monthly expense at60%AMI(Per OHCS App. - Max. Bent) 'MontlyYtetd Annual Yield 1 bedroom 16 $ 905.00 $ 14,480.00 $ 173,760.00 2 bedroom 23 $ 1,086.00 $ 24,978.00 $ 299,736.00 3 bedroom 20 $ 1,254.00 $ 25,080.00 $ 300,960.00 Total 59 $ 3,245.00 $ 64,538.00 S 774.456.00 The required monthly rent payments are as follows, based on City estimates. 100% AMI: 590,375.60 60%AMI: 364.538.00 Difference: S25,821.60 (monthly) The forecasted property tax (annual) for year 1 is: S25,787.49 The forecasted property tax (monthly) is: 52.148.96 Finding: The Required Rent Payment under the 60% AMI maxirnum rent cost reflects the full value of the property tax exemption. D. The forecasted rent reduction (savings) materially exceeds the forecasted property tax exemption. The annual market rate rental income was estimated in the project appraisal at 51.348.800. This appraisal was produced by an appraiser and market study consultant approved by OHCS (Oregon Housing and Community Services) which oversees LIHTC applications and conformance, The annual restricted rental income of the project is projected to start at S774,456.00 after subtracting the OAHTC passthrough that will occur This forecasted rent reduction of 5559,548 per year materially exceeds the amount of the requested property tax exemption The estimated annual market rate rental incorne as a function of 100 % of AMI, calculated in the table under question C., shows an estimated amount of $1.084,507.20. Additionally, the annual restricted rental income (maximum) displayed in the OHCS application is derived to equate to 5774,456.00. Thus, the forecasted rent The City of La Pine is an equal opportunity provider Resolution 2024-01 a reduction on this basis equals $310,051.20. This does materially meet and exceed the annual forecasted tax exemption of $25,787.49. E. The applicant at the time of application has displayed as part of their financial appllcatlon to the state, or through contract with the City. a contribution to the Ctty's community giving fund, to be made on an annual basis, and for the regulated life of the project. Based on prior conversations with the City Manager, Danco proposes to contribute $123,764.94 to the Community Giving fund when the project is Placed in Service. This upfront contribution is the sum of the estimated tax payments to the City and Urban Renewal Districts over 20 years, and will be In lieu of annual contributions to the Community Giving fund. F. The exemption has been approved as provided in ORS 307.623 (Time for filing appllcatlon), pursuant to an application filed before July 1, 2030. This is pending and requires city approval. G. The housing units on the property were constructed after the local governing body adopted the provisions of ORS 307.615 to 307.523. The local jurisdiction adopted ORS 307.515 to 307.523 In October 2023. The housing units started construction in November 2023. H. For any given project. the amount of the developer fee will be examined as a part of the appllcatlon process on a case -by -case basis, but in no event may the developer fee be in excess of that allowable (or for projects not receiving Oregon Housing and Community Services support, would be allowable) by Oregon Housing and Community Services. The project funding is being administered by OHCS, who will ensure that the developer fee meets their requirements. I. The proposed project must have received land use application approval accompanied by all associated studies or other application requirements from the City of La Pine and have all required Deschutes County or other agency regulatory permits approved. This does not include final inspections for public improvements, conformance with building, electrical, structural, or plumbing code or other final occupancy requirements. The project has received land use approval from the City of La Pine and building permits from Deschutes County. J. The proposed project should project a Community Services/Social Services element to the benefit of the low- Income residents as identified and evidenced by a service contract or MOU with a management agency which defines the programs or services to be provided, and to extend for the twenty-year regulatory period of the project The project will have ongoing resident services offered by the local organizations Neighbodmpact and Latino Community Association. See the attached MOUs for details. K. The information on the application filed pursuant to ORS 307.521 (Application for exemption) meets any other criteria adopted by the governing body. No other information is required at this time. The undesigned as an approved representative of the applying entity verifies that at information, data, and responses contain thi6 application are true and complete under penalty of perjury. D pre tative: La me Huntington Rd. Limited Partnership The City of La Pine is an equal opportunity provider Resolution 2024-01 EZ/04/60 -13S 1IWl13d `E NIalll8 31.1d v, ad'ala rwmx $a is SIN31/111HVdd NO1ONI1Nf1H T se 882 i v. xe air"0°Nn vx"dan•..mrv0IrO•30 oao00-rm0.1Va YNSVIV sin0, 011d 3dl1O311H3aV dflOdO ea Vl1NnH BOARD OF COMMISSIONERS AGENDA REQUEST & STAFF REPORT MEETING DATE: December 11, 2024 SUBJECT: Sheriff's Office Request for Opioid Settlement Funds RECOMMENDED MOTION: Move approval of the requested use of $283,000 in opioid settlement funds by the Sheriff's Office. BACKGROUND AND POLICY IMPLICATIONS: In 2021, a nationwide settlement resolved all opioid claims brought by states and local political subdivisions, awarding $26 billion for distribution over 18 years. The settlement amount Deschutes County is expected to receive is estimated at $7.9 million over that time. To date, Deschutes County Sheriff's Office (DCSO) has not requested any of the opioid settlement funds received by the County. DCSO requests $283,000 of this funding to cover the cost of one Registered Nurse and to fill the gap between what will be received with grant funding and the actual cost of medication administered through the jail's Medication Assisted Treatment (MAT) program. These additional funds will ensure the operation of the MAT program through June 30, 2025. BUDGET IMPACTS: $283,000 in revenue to the DCSO in FY25. If approved, a resolution will be submitted to adjust the budget to recognize the additional revenue and increase DCSO expense appropriations. ATTENDANCE: Michael Shults, Captain Eden Aldrich, Medical Director Jessica Vanderpool, Sr. Management Analyst