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City piles up millions in waivers that could hit homeowners

by: TRIBUNE PHOTO JAIME VALDEZ - Portland transportation planners hope to end floating sidewalks or sidewalks to nowhere, like this one on Southwest Multnomah Boulevard. Developers are required to build them in front of new infill project, but the city has been waiving the requirement because they dont make much sense. Instead, planners are studying how to pool the money that would other be spent on them and use it for sidewalks that connect to something on higher priority streets.Thousands of Portland homeowners are on the hook for millions of dollars worth of future street and sidewalk improvements — and hundreds more are joining the list every year.

The city has no plan yet to collect and spend the money, however, despite not being able to pay for needed street maintenance and new sidewalks.

The situation is one more example of the city’s complex transportation funding system that has been criticized for favoring some kinds of projects, like the Portland Streetcar, instead of others, like basic street maintenance and safety improvements.

But Portland’s Bureau of Transportation will soon begin a study that could allow it to collect some or all of the money owed in the future to help priority projects on the most potentially dangerous streets. It will be financed with $275,000 in permit and other fees collected from homebuilders, the original source of the obligations.

“The plan is to come up with a program that will allow the city to collect, pool and spend the money on infrastructure improvements that meet its goals,” says PBOT Development Services Manager Christine Leon.

The obligation is in the form of waivers of remonstrance signed by builders of many new houses in Portland since the 1970s. They are essentially IOUs that can be redeemed to finance street and sidewalk improvements in front of the houses. PBOT officials say that 9,000 waivers are on file, and an undetermined number of additional waivers may have been collected but not yet recorded.

Most of the waivers are attached to residential infill projects. Leon and other PBOT officials say the city doesn’t intend to enforce the previous waivers. But they say the city needs a new infill development policy to ensure it collects and spends some or all of the money wisely in the future.

“We need to know what we should collect and where we should spend it,” says Leon.

‘Floating sidewalks’

The total value of the existing waivers is impossible to estimate. The most common work waived was a sidewalk in front of a new house. Sidewalk costs have increased substantially over the years, in part because of increases in concrete and labor costs. But the city has also added stormwater management requirements that could mandate that bioswales and other filtration systems be included. New fire hydrants and storm sewer connections could also be required in some cases. The cost of all that work could total tens of thousands of dollars for each house, and maybe much more.

City policies require builders to pay for such work on unimproved or substandard streets when new homes are constructed. But many homebuilders requested and obtained waivers for years because the work did not make much sense — it would have resulted in short, isolated sidewalks not connected to anything.

In some cases, builders either did not request or were not granted the waivers, resulting in the so-called “floating sidewalks” seen around town. That is something PBOT would like to eliminate.

“They’re a problem of infill development that’s taken a long time to address,” says Leon.

by: TRIBUNE PHOTO  VERN UYETAKE - Developers were not required to build sidewalks along the unimproved streets in Southwest Portland, but the homeowners could be charged for them.

Court rulings

Most homeowners with a waiver of remonstrance attached to their property probably don’t even realize they owe the money. That’s a big reason the city has no plans to enforce them: homeowners would rebel, even if they got a new sidewalk in front of their house.

But enforcing the waivers would not do much to solve the city’s transportation funding problems, anyway. Many, if not most of the properties are individual infill houses on just one or two lots along an unpaved or substandard street. Even when such a street is lined with infill houses with the obligations, it is probably not heavily used by vehicles, bicyclists or children on their way to school. Improving such streets would do little to reduce the wear and tear on many automobiles or improve safety for many bicyclists and pedestrians.

The situation has also been complicated by a series of court rulings, including a June 2013 opinion issued by the U.S. Supreme Court in Koontz v. St. Johns River Management District. Some land-use attorneys are beginning to argue that governments cannot require property owners to pay more for infrastructure improvements than the benefits to be received. Officials at PBOT hope to be able to contract with a consultant in its upcoming study to determine what that means in terms of how much sidewalks and other work infill development can be required to perform.

PBOT hopes to complete the study by July 2015 and prepare a new infill development policy for the council to consider. In the meantime, it is continuing to grant remonstrance waivers on some projects, even though there is no guarantee they will ever be enforced.

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