LA GRANDE — The La Grande Urban Renewal District is one step from having a 2025-26 general fund in place that would continue to fund all core programming.

The city’s budget committee voted Monday, May 14, to recommend the La Grande Urban Renewal Agency adopt a general fund budget of $2.4 million for 2025-26.

“The intent with the city council and the urban renewal agency is to, with urban renewal funding, first fund the core programs for economic development in the urban renewal district and then to have an under levy,” City Manager Robert Strope said.

Looking at the numbers

The proposed budget for the Urban Renewal District includes funding to retain staffing levels, core economic development funding and funding for programs. It also maintains an ending fund balance of nearly $250,000.

“We’re also carrying forward quite a bit of funding, so we’re well within those parameters,” Strope said. “This allows us to only need $800,000 of new property tax revenues to be levied for our debt service and the programs that we do.”

The Urban Renewal Agency has two budgets — the general fund and the debt fund. Property taxes go into the debt fund and the district does the debt service on the bonds out of this budget. Strope said this includes bonds for the Adams Avenue streetscape project, Big H project and refunding for the business park.

The proposed general fund budget includes $1.35 million in project funding, which is the same amount in 2024-25 budget. This includes allocating $350,000 to the call for projects (nonbusiness park) and $75,000 to the Facade Grant Program.

Nearly 70% of the project funding — $925,000 — is carryover from the current fiscal year’s budget: $500,000 for an agency-initiated project and $425,000 for the traded sector or business park call for projects business attraction program

The budget proposal includes a $15,000 increase in funding to La Grande Mainstreet Downtown to help cover increasing operating costs. The funding level to LGMSD has remained unchanged since 2012, Strope said, which was when the program was started.

“One significant change in this budget over the prior years is a request to increase the contribution that the agency makes to La Grande Mainstreet Downtown from $25,000 to $40,000,” he said.

Under levy

When the ordinance that created the urban renewal district was adopted, Strope said, there was no set sunset date. There is, however, maximum indebtedness. Once the district reaches maximum indebtedness and can no longer complete new projects, the agency will continue to exist and levy taxes until all the debt is retired — at which point the district will sunset.

“Because we don’t have a specific sunset date,” Stope said, “when we under levy that pushes out the time frame for the district to sunset.”

The under levy is an annual decision the agency makes, Strope said, which allows funding that would otherwise go to the district to instead go to other taxing jurisdictions — including the city of La Grande. The agency gives up $2.41 cents for every dollar that goes into the city’s general fund.

“If urban renewal went away tomorrow, your tax bill would not change a dime,” Strope said. “When urban renewal goes away it’s still that $17 and change of assessment — it’s just who gets it that’s different.”

Other jurisdictions include the La Grande School District, Union County and vector control.

The agency will discuss a number of “fairly significant projects” during a work session this year, Strope said, that would “eat up” much of the maximum indebtedness. The district has $7.4 million of maximum indebtedness remaining, according to Fiance Director Heather Rajkovich.

The La Grande Urban Renewal Agency will vote on adoption of the proposed 2025-26 budget on June 4.