Though spending less than what she proposed, a committee of the Oregon Senate has advanced Gov. Tina Kotek’s plans to jump-start housing production and to continue state aid to local efforts to provide shelter beds and prevent homelessness.
The Senate Committee on Housing and Development voted unanimously on Tuesday, Feb. 13, to send two bills encompassing her plans to the Legislature’s joint budget committee.
The estimated price tag for the bills is $350 million, less than the $500 million that the Democratic chief executive proposed for housing production and $100 million for homeless programs. But the legislative total does include the full $100 million that Kotek sought for the latter programs.
Legislators said later there are other spending priorities in the 2024 session, which must close no later than March 10.
“We do have to have the infrastructure for the cities to use and kick start (housing) production," House Republican Leader Jeff Helfrich said at a session preview Jan. 31. "The governor has a very robust ask for infrastructure. As we sit on the budget committee and look at how many dollars there are and save for the future, those asks are going to have to be pared down.”
Kotek had sought $200 million for public works relating to housing, but the Senate committee recommended $100 million.
Helfrich was the top Republican on the housing committee during the 2023 session, but when he became caucus leader after the session, he switched to the joint budget committee.
Among those voting for the bills were Sen. Dick Anderson of Lincoln City, the committee’s top Republican, and Senate Republican Leader Tim Knopp of Bend, who also is executive vice president of the Central Oregon Builders Association. Despite disagreements on the 2024 session’s other top priority — clearing barriers to addiction treatment and reinstating criminal penalties for possession of specified drugs — the parties have largely agreed on housing.
Committee Chair Kayse Jama said the legislation (Senate bills 1530 and 1537) builds on the work done a year ago — when lawmakers passed and added to Kotek’s request for shelter beds and homelessness prevention, for a total of $217 million — and in previous sessions.
The Portland Democrat said, "This package makes significant progress on our homelessness relief and affordable-housing production goals. Gov. Kotek and her team did incredible work on this package, and I want to thank her for her advocacy and involvement, as well as the legislators and community members who have worked with us over these months. We are all committed to making sure every Oregonian has safe, affordable housing."
Land use bypass
Senate Bill 1537 includes a still-debated provision, an earlier version of which (HB 3414) passed the House but failed in the Senate at the close of the 2023 session.
The new version allows qualifying cities a one-time expansion of urban growth boundaries without the extensive justifications required by Oregon’s land use laws. Cities of fewer than 25,000 people can expand by 50 acres, and cities with more people can expand by 100 acres. In the area covered by Metro, the regional government that covers urban parts of the three Portland area counties, the cap is 300 acres. Metro oversees the Portland area growth boundary.
Under the new version, cities must show that they have done comprehensive planning and permitting before expansion — and demonstrate the need for both housing and land.
The bill also creates a state Housing Accountability and Production Office, which aims to help local governments reduce barriers to housing construction and streamline the permit process.
Anderson is a former mayor of Lincoln City who has played a key role in the negotiations. He said this in a statement after the committee vote:
“This is a much-needed step in the right direction in our continued effort to produce homes in Oregon by removing barriers, expanding buildable land, cutting red tape, and investing in much-needed infrastructure. But the work doesn’t stop here. I look forward to our continued progress in building homes for all Oregonians.”
Funding details
The centerpiece of Senate Bill 1537 is a new commitment of $75 million to a revolving fund for interest-free loans to local governments to help finance production of affordable housing and moderate-income housing projects. Affordable housing, under a federal definition, costs no more than 30% of the area’s median household income, with half being above and half below that figure. (For Portland, the figure was $78,421 in 2021 dollars between 2017 and 2021.)
Senate Bill 1530 makes significant additional investments directed at immediate needs for Oregonians, including funding ongoing operations of homeless shelters, rental assistance, and keeping families in safe homes during extreme weather events.
According to the Senate president’s office, funding includes:
$100 million in direct allocations for shovel-ready projects within existing urban growth boundaries.$65 million for ongoing support of shelters.$40 million to the Oregon Department of Housing and Community Services for rental assistance, with a set-aside for culturally specific organizations.$18 million for housing of people recovering from drug addiction.$10 million for land acquisition to convert buildings into affordable housing.$3.5 million for air conditioners and air filters provided on an emergency basis to at-risk individuals.$4 million to the residential heat-pump fund within the Oregon Department of Environmental Quality.$7.5 million to support home repairs and improvements to lower energy usage and make homes safer under the Healthy Homes program.
House action
Additional money may originate from legislation pending in an Oregon House committee, although the proposed amount comes close to the $100 million mentioned above for "shovel-ready" projects in Senate Bill 1530.
Rep. David Gomberg, a Democrat from the central coast, has proposed a total of $90 million for 50 specified water supply and wastewater treatment projects in an amendment to House Bill 4128. The House Agriculture, Land Use, Natural Resources and Water Committee heard it on Tuesday, Feb. 13.
The specified projects would support 11,000 new homes — and the money would go directly to the local government sponsors.
“We have managed to convince people that if we want more housing, we are going to need to make sure our water infrastructure can support it,” Gomberg said in an interview afterward. “Across Oregon, water systems are at capacity, aging and falling apart. That brings into question not just their ability to support new growth, but also serve our current population.”
Gomberg and Republican Rep. Emily McIntire of Eagle Point told the committee on Jan. 11 that they were working on a funding proposal to dovetail with Kotek’s plans. However, Gomberg said then he expected to get a total of only $20 million for public works projects.
That bill, which also is headed for the Legislature’s joint budget committee, would direct the Oregon Business Development Department to devise ways to evaluate other projects that will not be funded this time — and it would get $250,000 to do so. The state agency oversees the special public works fund, which relies on legislative approval of Oregon Lottery proceeds in the state’s two-year budget cycle.
Gomberg said the fund needs far more money if Oregon is to get serious about increasing housing production to the 36,000 annual goal Kotek set in an executive order when she took office last year.
The League of Oregon Cities has submitted a list of 225 projects, which it says could provide capacity to accommodate 48,000 new housing units — but at a cost of $828 million. About 150 are related to water supply and wastewater treatment.
“We can’t support a response of that magnitude,” Gomberg said. “But we can get a real and meaningful start.”
pwong@pamplinmedia.com
NOTE: Clarifies that the Senate's proposed total spending is less than Gov. Kotek's recommended amount, and that the $90 million proposed in a House committee dovetails with the Senate's proposal. Adds comment from House Republican leader.
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