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John Fregonese urges home builders to find infrastructure funds



TRIBUNE PHOTO: JONATHAN HOUSE - Large sewer pipes wait to be installed at a $3.5 million project that could serve a proposed subdivision above Southwest Macadam Avenue near Taylors Ferry Road.Suburban communities need more infrastructure funding for balanced growth to occur in the region, says respected local planner John Fregonese.

Speaking at a Thursday luncheon hosted by the Home Builders Association of Portland, Fregonese said he agrees with Metro’s assumptions that a disproportionate percentage of future growth will consist of new apartments in the city of Portland.

“There is capacity in Portland. The math is there,” said Fregonese, who was Metro’s planning director in the 1990s before becoming a private consultant.

But Fregonese said a large percentage of newcomers would also move to surrounding cities with walkable neighborhoods — if they can be built.

Plans already exist or are underway for such neighborhoods in Hillsboro, Beaverton, Gresham, Wilsonville, Tualatin, Sherwood and Pleasant Valley. Some would be located in areas where Metro expanded the urban growth boundary for new development over the past two decades.

Metro has added around 22,000 acres to the urban growth boundary it has administered since 1978. But although it has helped fund planning in some of them, little construction has occurred, in part because of the daunting cost of providing the infrastructure they need, such as roads, water lines and sewer systems. That is largely because of the prevailing thinking that new development must pay for itself, Fregonese said.

“Gresham, Pleasant Valley, Hillsboro, they should all be slam dunks, but they’re not,” he said. “The problem is infrastructure financing.”

South Hillsboro is a good example of the regional problem. It is being planned for about 8,000 new homes in addition to some mixed-use centers and public services. But paying for the required infrastructure could add as much as $41,000 to each home, making them financially unrealistic.

TRIBUNE FILE PHOTO - Planner John Fregonese believes many newcomers will move to developments like Villebois in Wilsonville if they can be financed.Hillsboro planners are trying to figure out if there are funding sources — such as a local improvement district — that could be formed to reduce that cost.

Other potential project areas face similar challenges, either now or once their plans are complete. They include North Cooper Mountain in Beaverton, the Basalt Creek area between Wilsonville and Tualatin, the Springwater community in Gresham, the Stafford Basin in Clackamas County, and Sherwood West in Sherwood.

According to Fregonese, some governments in other parts of the country provide far more money for such projects. Texas especially supports growth, he said, and sells tax-free bonds for development.

Fregonese points to two successful project areas where infrastructure funds were found — Villebois in Wilsonville and Orenco Station in Hillsboro, which was already inside the city limits when development started. Both are walkable neighborhoods featuring a mix of single-family and multifamily housing, with nearby amenities.

Fregonese said those are the kinds of communities that could balance future growth in the region if infrastructure funding problems can be overcome. He urged those at the luncheon, which included many of the region’s top home builders, to work with the suburban governments to identify financing solutions.

Portland plays by different rules

Much of the new development in Portland is not required to pay for itself. That’s partly because of the city’s aggressive use of tax increment financing to subsidize growth in urban renewal areas, a redevelopment tool available only in existing urbanized areas. City leaders also have secured state and federal funds to help build transit lines that support redevelopment projects in areas such as the Pearl District, South Waterfront and the Lloyd District.

But Portland also routinely increases the capacity of its infrastructure in areas where growth is predicted to occur. A good example is the Southwest Ventilation and Capacity Improvements Project being undertaken by the Bureau of Environmental Services. It is an expansion of the Southwest Parallel Interceptor sewer system, which handles approximately 80 percent of the sewage from the ridgeline of the West Hills west to the Washington County line and Highway 26 south.

The $3.5 million project is installing about 1,000 feet of 24-inch concrete pipe along Southwest Taylors Ferry Road and 800 feet of 48-inch concrete pipe along Southwest Virginia Avenue. One purpose is to help the Southwest 68th Avenue Pump Station handle stormwater when it goes online. But another purpose is to help accommodate future growth in the area anticipated in the city’s comprehensive plan.

One project likely to benefit from the expansion is Macadam Ridge, a subdivision of 46 new single-family homes proposed in the hills above the intersection of Southwest Macadam Avenue and Taylors Ferry Road. The project is working its way through the city planning process. If approved, it will be the first traditional subdivision built in Portland in many years.

If the project proceeds as proposed, BES will assess the developer an estimated $259,118 in Sanitary Sewer Service and Stormwater Management system development charges for the 46 houses. The money will help cover new sewer pipes into the development. But the Southwest Ventilation and Capacity Improvements Project will already be finished and operating by then.

At the very least, such capacity expansion projects amount to no-interest loans to developers. If the developers do not repay the portion they use, that means all Portlanders are supporting the new growth, whether they know it or not.

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