Project Bonds for Urban Renewal Projects


​Salem’s urban renewal areas depend on projects to help develop and revitalize specific locations. To reach this goal and assist developers with additional financing opportunities, Salem offers project specific financing in the form of a project bond.

A project bond may be used to finance both public infrastructure and private development costs of “urban renewal projects” as defined in ORS 457.010(15). An “urban renewal project” is:

  1. A capital improvement project
  2. Located inside the boundaries of an urban renewal district
  3. Described in the urban renewal plan for the area

The Urban Renewal Agency adopted a resolution establishing guidelines on November 28, 2005.

​Project bond guidelines:

  • Only tax increment generated from the specific development will be pledged to repay bonds.
  • If the development fails to generate sufficient tax increment to make the scheduled debt service, the Agency will not be required to pledge any other tax increment funds.
  • All Project Bond debt will be subordinate to the Agency’s senior lien debts.
  • The Agency will enter into Project Bond agreements for no longer than 20 years.
  • The Agency will pledge no more than the value of 20% of its current yearly tax increment collections to repay project bonds.
  • The Agency will issue Project Bonds for no more than 20% of the total project costs (i.e. on a $20 million development, the Agency will issue a Project Bond in the maximum amount of $4 million).
  • The developer must provide the Agency with a project pro forma that demonstrates, to the Agency’s satisfaction, that the project could not otherwise happen without the Agency’s assistance.
  • The developer shall demonstrate financial feasibility for the project by providing, to the Agency’s satisfaction, evidence of equity commitments and commitment letters from private lenders.
  • The developer must demonstrate, to the Agency’s satisfaction, that he or she has a minimum of 10% equity in the total project.
  • Project Bonds will be issued only to finance construction costs.
  • The project must serve as a model of well-designed, high quality development, and must be designed to enhance the neighborhood.
  • All costs incurred by the developer that are subject to prevailing wage will be borne by the developer.
  • The project should be of such significant scope that it will foster additional redevelopment activities in the surrounding area.

Because project bonds place a lien only on the revenues of a single project, project bonds are normally issued to someone directly involved in the project that understands, and can control, the risks associated with completing and maintaining the project.

​Additional resources

Contact us

Renee FrazierFinancial Services ManagerUrban Development Department
Mailing address:
350 Commercial ST NE
Salem OR 97301

Use the map to find out if you are in one of the urban renewal area's eligible for project bonds.

Open a mobile-friendly, full screen map of the Urban Renewal Area in a new window.

Urban Renewal Area map