Albany City Council voted Nov. 5 to adopt an ordinance establishing a multiunit property tax exemption (MUPTI) program (amending Albany Municipal Code Title 3 to create chapter 3.1) and later approved a resolution that provides the program's guidelines. The decisions followed extended discussion over public-benefit requirements, in-lieu fees, and whether to exclude the Historic Central Business District from eligibility.

Council debate focused on how much public benefit the city should require in exchange for a seven- or 10-year property tax exemption. Councilor McLeod said she supports the program's goals but urged higher public-benefit thresholds and a larger in-lieu fee. Councilor Thompson proposed an amendment to exclude the Historic Central Business District from the MUPTI boundary, arguing that district tax revenues should be preserved to pay down prior downtown investments. Councilors discussed the program's high qualification bar, which includes an independent third-party financial analysis to demonstrate a project could not proceed without the exemption.

Several amendments were proposed and voted on. A motion to require a minimum of four public-benefit items for a seven-year exemption and six for a 10-year exemption and to set the in-lieu payment at 20% of foregone taxes failed on a 3-3 vote. A separate amendment to exclude the Historic Central Business District from the MUPTI area was also defeated. Council then voted on the ordinance itself; the roll call produced an evenly split vote among council members and the mayor cast the deciding vote in favor, adopting the ordinance.

The council also adopted a resolution establishing program guidelines, with the vote again producing a tie that the mayor broke in the affirmative. As part of the actions on the floor, the council authorized staff to negotiate and enter an intergovernmental agreement (IGA) with Linn County related to program implementation; that authorization passed on a 4-2 roll-call vote.

City staff and speakers clarified the scope of the exemption: only the qualified new improvements (typically the residential component) are eligible for the tax deferral; underlying land and preexisting improvements remain taxable. Staff also emphasized that system development charges, connection fees and other utility or SDC charges are not waived as part of MUPTI.

Councilors framed the policy trade-offs differently. Supporters said the tax tool is necessary to incent redevelopment and job creation that otherwise would not occur; opponents urged the council to demand stronger public benefits for a decade-long tax break and to consider neighborhood equity.

Actions recorded in the meeting files show the ordinance adopting MUPTI was approved after the mayor's tie-breaking vote; the resolution setting guidelines passed under the same circumstances; and staff were authorized to enter an IGA with Linn County (4-2). Staff said the program is expected to be used sparingly because the financial analysis required to qualify projects is time-consuming and costly.