While an urban renewal district is in effect, the city, county, and school districts continue to receive taxes based on the property value in the district when it was created. Any tax revenue on growth in property values above that “frozen base” is redirected to projects within the urban renewal district. For instance, in the Downtown District, this “frozen base” is about $31 million, and the City receives about $200,000 of taxes each year on the frozen base.
If the Downtown Urban Renewal District stopped its collection of tax increment revenue in 2023, the City’s General Fund would receive approximately 50% of what the Downtown District collects ($1.3 million per year as of FY22). Lane County would receive approximately 9% ($235,000 per year as of FY22). Approximately 34% ($880,000 per year as of FY22) would be collected on behalf of School District 4J, although it is important to note that the impact to 4J’s overall budget would be negative. This is due to State funding mechanisms for education and local properties that are in ‘compression’ related to State laws regarding property tax limits. If the Downtown Urban Renewal District ceases to collect tax increment revenue, the net impact to School District 4J would be an estimated decrease of $150,000 per year as of FY22.