Multi-Unit Property Tax Exemption
The Multi-Unit Property Tax Exemption (MUPTE) is a tool that can shift a proposed housing development to being financially feasible. It is a state-enabled program designed to be an incentive of redevelopment of residential properties in city centers and along transit corridors. In Eugene, the City Council has authorized the use of MUPTE in the downtown area.
MUPTE allows new multi-family units (5 or more units) to avoid property taxes on the value of new residential construction for up to 10 years. The property continues to generate taxes for the land value during the exemption period.
The figure to the right shows how the costs of development and operating revenues are connected. The construction costs are all up-front and are made before the developer generates any revenue from the development. Typically, developers use a mix of equity (i.e., investor funds) and debt (i.e., bank loan). The developer estimates the future rents from the apartments and/or commercial space or sales from condominiums, to estimate if those expected revenues can cover the debt payments and provide investors with a return on their investment that is competitive with other investment opportunities. By exempting property taxes, MUPTE lowers the operating costs in the early years of a housing development so that it becomes financially feasible.
The Multi-Unit Property Tax Exemption program is enabled under state law for the purposes of stimulating the construction of multi-unit housing in the core area and to ensure use of the core area as a place where citizens have the opportunity to live as well as work. Projects eligible for the tax exemption include construction, addition or conversion of rental or ownership multi-unit housing within the MUPTE boundary (please see map below). Projects must include a minimum of five new housing units.
In July 2015 the Eugene City Council approved an ordinance Opens a New Window. revising the Multi-Unit Property Tax Exemption (MUPTE) program. Revisions included changes to the criteria, process, and boundary, and removal of student housing as an eligible project type. The Required Public Benefit Criteria are:
- Compact Urban Development
- Green Building Features (ensuring building energy performance is 10% above code)
- Local Economic Impact Plan (including support for local businesses, minority and women business enterprises, and ensuring compliance with laws)
- Moderate-Income Housing Contribution
- Project Design and Compatibility (including scale, form, and quality of the building; mixture of project elements; relationship to the street and surrounding uses; and parking and circulation)
- Historic and Existing Housing Sensitivity
- Project Need
The MUPTE program offers a property tax exemption on the new structure or incremental change in the property value of the building that comprises the project for a maximum of 10 years. Projects are required to address specific quality standards established in the program. Tax exemption requests are reviewed and approved by the Eugene City Council.
The non‐financial materials included with the application will be reviewed by staff and a 30‐day written comment period will start. The financial information will be reviewed by an independent professional consultant. The City Manager will then convene the Project Review Panel to review the application’s conformance with program criteria and the consultant’s financial conclusions.
Frequently Asked Questions About MUPTE Opens a New Window.
The administrative rules for the updated MUPTE program are available Opens a New Window. online.
The 2015 MUPTE update established a Review Panel, tasked with providing a third-party review of individual applications for the City Manager. The Review Panel:
- Reviews the project applications, including the consultant’s review of the project’s financial projections.
- Reviews the applicant’s conformance with the Required Public Benefits and making recommendations regarding approval/denial of the tax exemption to the City Manager.
- Reviews the project’s conformance with approval requirements midway through construction, at completion of construction, and during the exemption period.
- Assists the City Manager in preparing an Annual Report on progress of the approved projects, program volume cap, and reporting documentation.
The Review Panel consists of two at-large neighborhood representatives selected by neighborhood association boards, an additional two representatives selected by the board of the neighborhood association in which the proposed project is located, and six technical professionals selected by the City Manager from the following six groups: architects/green building specialists; building trades unions; developers; environmental professionals; public health professionals; and human rights representatives.
The MUPTE Review Panel started conducting annual project and program reviews in the fall of 2016. Read their review memos below:
- FY22 Program and Project Review
- FY21 Program and Project Review
- FY20 Program and Project Review
- FY19 Program Review
- FY19 Project Review
- FY18 Program Review
- FY18 Project Preview
- FY17 Program Review Opens a New Window.
- FY17 Project Review Opens a New Window.
- FY16 Program Review Opens a New Window.
- FY16 Project Review Opens a New Window.
Use the map below to locate your property in the MUPTE and other economic incentive areas.
MUPTE Review Panel Open Position
The City is accepting applications for the Public Health technical representative seat on the MUPTE Review Panel. The panel provides third-party review of the MUPTE program for the City Manager and meets as needed to:
- review new MUPTE applications;
- review previously approved projects’ compliance with approval resolutions;
- prepare annual reports on the progress of the approved projects, the program’s volume cap, and reporting documentation; and
- annually review overall program efficacy.
The panel is comprised of neighborhood representatives (selected by neighborhood association boards and the neighborhood of the proposed MUPTE project) and six technical members selected by the City Manager. In addition to the open public health seat, the Panel includes an environmental professional, architect, developer, human rights representative, and building trades representative.
Members serve for three-year terms with an opportunity for renewal. The deadline to apply for the committee is Monday, September 11, 2023. To apply, please submit a letter of interest and provide evidence of technical expertise in the public health field. Letters of interest or questions should be directed to Dylan Huber-Heidorn at email@example.com or 99 West 10th Avenue, Eugene, OR 97401.
The City of Eugene is currently considering one application for the Multi-Unit Property Tax Exemption program. The Eugene City Council will consider the application at a meeting on October 11, 2023. The application can be viewed through the link below and is available for viewing at the Planning and Development Department Permit Information Center at 99 W. 10th Avenue, Eugene, OR 97401 from 12:00PM to 4:00PM Monday through Friday. Written comments were accepted during a 30-day period earlier in 2023.
This application requests a 10-year tax exemption for a proposed 237-unit development at the intersection of 4th Avenue and High Street.
City Council approved the Olive Lofts application on July 27, 2016.
Click here to download the Council Packet.
City Council approved the Gordon Lofts application with a 5-3 vote at their October 17, 2018, work session. Gordon Lofts is a 7-story, 127-unit apartment building with ground floor commercial space at the northwest corner of 6th Avenue and Pearl Street and is part of the 5th Street Market expansion. The building was completed in 2020.
- The Review Panel conducted reviews of the project during and after construction See below for summaries of their reviews:
City Council approved the Ferry St. Manor application with a 5-3 vote at their September 11, 2019, work session. Ferry St. Manor is a 5-story, 50-unit apartment building located off of Ferry Street, north of 11th Avenue. The building was completed in 2020.
- The Review Panel conducted reviews of the project during and after construction. See below for summaries of their reviews:
City Council approved MUPTE applications for three proposed apartment buildings located on undeveloped lots in the Downtown Riverfront area at their March 9, 2022 work session. Council previously discussed the applications at their February 22, 2022 meeting. The projects would result in the addition of 381 new market-rate residential units in the Downtown Riverfront. The applications and links to Council materials can be accessed below. (Alternative scenarios for all three parcels were withdrawn from consideration by the applicant after submission; any references to Scenario B in either of the respective applications can be ignored.)
- Application 1 (Parcel 3BC), Parcel 3BC MUPTE Approval Resolution
- Application 2 (Parcel 7), Parcel 7 MUPTE Approval Resolution
- Application 3 (Parcel 9), Parcel 9 MUPTE Approval Resolution
- February 22, 2022 work session - materials and video (discussion only)
- March 9, 2022 work session - materials and video (discussion and action)
- What Is MUPTE?
- How does MUPTE support multi-unit residential development?
- How does the City determine if a housing project can receive a MUPTE?
- Why should the City of Eugene support dense housing in the downtown core?
- Can MUPTE support affordable housing?
- Does MUPTE cause the City to reduce its tax revenue?
- How effective has MUPTE been?