Support BikePortland - Journalism that Matters

As state law passes, the fight for affordable proximity moves to City Hall

Posted by on March 4th, 2016 at 12:36 pm

trauma

A rally last fall to better protect Portland tenants from displacement.
(Photo: M.Andersen/BikePortland)

After years of fighting, a “grand bargain” on affordable housing passed Oregon’s legislature this week. But it won’t begin shaping Portland’s bikeable neighborhoods until after the city council takes action of its own.

Representatives for Mayor Charlie Hales and his council colleague, Housing Commissioner Dan Saltzman, say that plans to do so are already underway.

Any city plan seems certain to include some level of “inclusionary zoning,” a measure that could require that up to 20 percent of units in some new buildings be sold and/or rented at discount prices to people who make less than 80 percent of the median income. (As of 2015, that 80 percent figure means that a family of three that makes less than $52,950 would qualify for the reduced-rate units.)

But many questions remain. In which neighborhoods would the rule apply? Will developers be allowed to build higher, or exempted from expensive requirements such as auto parking, to make up for their losses from those discounted rents? Will inclusionary zoning be coupled with other changes such as re-legalizing duplexes or garden apartments or charging a “linkage fee” on all new development? Developers will also have the option to get out of the inclusionary zoning requirement by paying into a city affordable housing fund; how high will that fee be?

All of those decisions will be made by cities like Portland, probably in the next few months.

Because migration to Portland boomed during the Great Recession just as the construction rate plummeted, the city’s population has grown 79 percent faster than its housing supply.

When vacancy rates are low, landlords can raise the rent without losing tenants.
(Data: Census Bureau.)

That’s left the metro area with one of the nation’s lowest rental vacancy rates and made soaring real estate prices and rents the single hottest issue in the current mayoral election.

Advertisement

Oregon’s House of Representatives approved a Senate bill Thursday that removed the “preemption” in state law that has banned cities from using inclusionary zoning. Gov. Kate Brown is expected to sign.

Saltzman’s chief of staff, Brendan Finn, said in an email Thursday that his boss has laid out a plan for “a community-wide data driven discussion that would include but would not be limited to members of the development community, as well as affordable housing experts and advocates.”

“Dan introduced a resolution at council Feb. 10,” Finn said. “Now that preemption is to be lifted and signed into law, we can get started on a process for crafting a policy for Portland.”

Hales spokeswoman Sara Hottman said the mayor is also ready to start work.

“Mayor Hales has instructed all involved city bureaus to develop plans for an effective Portland implementation of the new law,” Hottman said in an email. “Commissioner Saltzman, in charge of the Housing Bureau, has been instrumental in passing the bill, and will be overseeing the implementation.”

A repeal of the state’s ban was the Portland city government’s top legislative priority in Salem this year.

Affordability advocates gear up for local debate
Occupy Portland on SW Main Street-4-3

Commissioner Dan Saltzman walks past an Occupy Portland demonstration in 2011.
(Photo: J.Maus/BikePortland)

The Portland advocates who’ve been pushing for repeal of the state ban said they’ll be shifting their work to City Hall, in part because they think a successful policy in Portland will create political support for a future effort to fully remove Salem’s regulation of housing price controls. Here’s the word from Vivian Satterfield, deputy director of OPAL Environmental Justice Oregon:

This is obviously a big day for OPAL Environmental Justice Oregon and the Oregon Inclusionary Zoning Coalition. We’re proud to have put this issue on the table in Salem and to have convened a large and powerful statewide coalition that together, brought about this historic victory for housing opportunity. That being said, there are key pieces of the legislation that need to be fixed in future years at the state level. OPAL and other partners of the Coalition, namely those organizations representing people of color and working families, expect to be at the relevant policy tables to craft a local IZ policy that maximizes the use of the tool in its current form. We have already initiated these discussions with Commissioner Saltzman’s office and we look forward to working with the future Mayor of Portland as well. Demonstrated efficacy of any inclusionary zoning policy both at the City of Portland and other jurisdictions ready to adopt their own IZ policy will undoubtedly support future efforts to seek a full repeal and local control.

For three years now, we’ve been exploring how you can’t have a truly bike-friendly city without affordable proximity. Depending on how this new state law gets enacted and what other changes come along with it, this could be a very important moment in making sure Portland’s bikeable neighborhoods don’t slip permanently out of reach for most Portlanders.

— Michael Andersen, (503) 333-7824 – michael@bikeportland.org

BikePortland can’t survive without paid subscribers. Please sign up today.

NOTE: Thanks for sharing and reading our comments. To ensure this is a welcoming and productive space, all comments are manually approved by staff. BikePortland is an inclusive company with no tolerance for meanness, discrimination or harassment. Comments with expressions of racism, sexism, homophobia, or xenophobia will be deleted and authors will be banned.

66
Leave a Reply

avatar
16 Comment threads
50 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
29 Comment authors
Brendan TreacyHello, KittyAdam H.Thank god I rent from familymaccoinnich Recent comment authors
  Subscribe  
newest oldest most voted
Notify of
Matt S.
Guest
Matt S.

This is the Portland that I’ve loved all these years, for a minute, I thought it was slipping away. I’m sure there’s more work to be done, but to have IZ laws reworked is a positive step for the people of Portland.

maccoinnich
Subscriber

“Will developers be allowed to build higher, or exempted from expensive requirements such as auto parking, to make up for their losses from those discounted rents?”

So far the answer to both those questions seems to be “no”, at least so far. In order:

The City recently published the draft of the 2035 Central City plan, which will regulate development in Downtown, the Pearl, South Waterfront, the Lloyd District, etc. While there was a lot of attention paid last year to height increases at a handful of sites in Downtown, almost none of those sites are receiving an increase in allowable Floor Area Ratio (FAR). Indeed, the amount of FAR that is automatically obtainable is being scaled back throughout the Central City, by the elimination of most of the existing FAR bonuses. (Right now extra FAR be gained by providing bike locker rooms, green roofs, and a whole host of other desirable things). The only remaining bonus in most of the Central City will be for providing affordable housing. However even if developers choose to do so, they won’t be able to build anything larger than what is currently allowed. So while the city might claim that they’re giving bonuses for affordable housing, they’re only doing it by taking away existing entitlements.

Secondly, the Planning & Sustainability Commission will be looking at revisions to parking requirements in Northwest on Tuesday next week. The current zoning in the Northwest Plan District doesn’t require any parking spaces to build, superseding the citywide requirements. The proposed revisions will eliminate this, requiring developers to build to the regulations adopted for much of the rest of the city in 2013. There is no language in the proposal that would allow this to be waived when affordable housing is built.

Adam
Subscriber

Great news! Also great that the unbelievably short-sighted proposal to expand the urban growth boundary is dead. Now we need to have a discussion on what tactics to improve affordability we should use. Ideally, all of them, but we should start by removing all minimum parking requirements for new developments.

RMHampel
Guest
RMHampel

I’m delighted to hear this news coming from Salem; the news from POrtland, not so much. This city needs IZ NOW, not in 3-4 years when studies and committee hearings and stakeholders meetings have run their course. The longer IZ rules take to implement, the faster Portland turns into into San Francisco; a great city to live in ONLY if you’re rich.

Lester Burnham
Guest
Lester Burnham

Interesting…Progressives have run this city for decades. And Progressives are complaining about housing costs.

RH
Guest
RH

I don’t quite get IZ zoning. Doesn’t it simply mean the folks who aren’t in the affordable housing essentially end up paying for the ‘gap’? Also, will income be checked each year to qualify for affordable housing? I have friends that make waaaayyy too much qualify for affordable housing, but they did qualify when they first applied years ago @ a lower income. One of my friends also have a 2 bed affordable unit where the second bedroom is his dining room?! Lots of loopholes….

RMHampel
Guest
RMHampel

IZ is not the whole answer. As the article pointed out, Portland needs to loosen up zoning rules to permit more kinds of development such as duplexes and courtyard apartments – as just two examples.

Anne Hawley
Subscriber
Anne Hawley

I just wanted to say that I like the term “affordable proximity.” I haven’t heard (noticed?) it before. It had a lot of power.

John Liu
Guest
John Liu

Any update on the pace of new apartment construction (number of permits, of starts, etc) now and expected for the coming years?

With new buildings popping up like mushrooms, I an curious if the housing shortage might be resolved or at least ameliorated in the next few years simply by growing supply?

mran1984
Guest
mran1984

Move back to where you “googled” Portland in the first place. I am far more concerned with the current level of public education and apartments are not going to improve that. Tall apartment buildings are ugly. They block the SUN. It is the sheer number of people moving here that has driven the cost of housing up. Houses are really, really cheap in Detroit.

JeffS
Guest
JeffS

It’s telling that this announcement has generated as much, if not more, discussion of height allowances as it has IZ itself.

Existing owners may be theoretically in favor of reducing housing prices, but in truth they are still more concerned with heights, aesthetics, and parking. Every single teardown is going to continue to generate a petition and protest. I don’t see that the inclusion of a below market-rate unit in the building is going to change that.

We should either let the builders build, or stop calling an expected supply/demand curve a crisis.

gutterbunnybikes
Guest

I tend to think that housing affordability is more a symptom of stagnate and/or lessening wages (when compared to inflation) for the lower and middle class for over 40 years, by in large the real estate markets as a whole have largely tracked with inflation for this time period – yes there are periods like Portland now which is not tracking with inflation- for right now, but by in large it’s the exception and not the rule.

Toss in the populations greater debt load (largely to compensate for the lack of wage increases), skyrocketing college tuition costs (most often even more debt) and the most populous generation in US history growing up and looking for housing you have the perfect storm for what is happening in Portland and other hot markets throughout the country.

If wages hadn’t stagnated, had college tuition costs followed inflation housing affordability wouldn’t be an issue for as many as it is now for many.

dan
Guest
dan

” If a developer puts up a building that was zoned for IZ and tries to cover the costs of the cheap units by charging extra for one of the expensive units, then tenants will go find some other unit in another building that doesn’t have to help cover the losses from a cheap unit.”

At less than 5% vacancy rates, that’s not likely to happy. Especially as most tenants, being “not stupid” will vie for the units in non IZ buildings, forcing those rental rates even higher.

“…a measure that could require that up to 20 percent of units in some new buildings be sold and/or rented at discount prices to people who make less than 80 percent of the median income.”

“Discount” prices should read “subsidized” prices. Someone needs to pay for the inclusion, and at the end of the day it will be the market rate renters.

RMHampel
Guest
RMHampel

dan
The teardowns that spark the most ire are replacing single-family houses with new, oversized, ugly single family houses within neighborhoods…I really think that there is less opposition to mid-rise buildings on arterials a la Division and Hawthorne. I’ll grant you that there is a lot of bellyaching about parking though. Implement a permit system or quitcha whining, I say.
Recommended 1

Dan, Couldn’t agree more… the teardowns>>> monster homes really bothers a lot of people and may translate into dislike of increasing density in inner SE.

da
Guest
da

Adam H.
That may be the case. However, I don’t think imposing additional design criteria will help with that either. The end result will very likely be less new apartments getting built during a massive housing shortage. Additional design guidelines to appease a minority of neighbors will only cost developers additional time costs and many may not even bother building. The guidelines offer no benefits to the neighborhood and will only result in a further restriction in housing supply. I firmly believe that many of the neighbors are fighting the change in the neighborhood itself and not any one specific detail of that change. Increased density and mid-rise buildings are just currently an easy target.
Recommended 0

I think neighbors fighting to retain the character of their neighborhood is valid and shouldn’t be marginalized by the sudden realization that things have changed. Not everyone wants to live in NYC, Vancouver BC or even Seattle.

Rental vacancies fluctuate, ugly buildings and poorly designed communities are more permanent. Knee jerk reactions seldom yield good results.

Thank god I rent from family
Guest

It looks like there may be an error in the article:

“Any city plan seems certain to include some level of “inclusionary zoning,” a measure that could require that up to 20 percent of units in some new buildings be sold and/or rented at discount prices to people who make less than 80 percent of the median income. (As of 2015, that 80 percent figure means that a family of three that makes less than $52,950 would qualify for the reduced-rate units.)”

The bill as enrolled reads: “197.309. (1) As used in this section:
(a) “Affordable housing” means housing that is affordable to households with incomes equal to or HIGHER than 80 percent of the median family income for the county in which the housing is built.”

This means, as of 2015, a family of three that makes $52,950 or MORE would qualify for the reduced-rate unit.There are additional tools within the bill that allow local jurisdictions to buy down units to 80% MFI or below, but not directly.