Board considers housing finance options
Washington County commissioners say they want more details about a construction excise tax and a special property tax levy, both of which could raise money for subsidized housing.
But during a work session Tuesday (Oct. 24), the commissioners say they are not wedded to either source.
"We have to do something about affordable housing," Commissioner Bob Terry said.
Terry said while he is willing to look at a construction excise tax, "I'm not ready to get excited" without more precise estimates of how much it would raise, who would pay it and how the money would be spent.
"We should look at other ways but we should be careful," he said.
Bend was the first in Oregon to levy such a tax, which is .3 percent of the building-permit valuation of residential, commercial and industrial development.
In the decade it has been in effect, according to city figures, it has raised $11 million for loans to build 539 multiple-family units and 76 single-family homes. The money has been matched by $62.6 million from state and federal funds and $14.2 million in private equity.
The Oregon Legislature authorized local governments to impose such a tax in 2016, although the maximum rate for residential development is 1 percent. It was part of a bill allowing them to require developers to provide below-market housing in "inclusionary zoning."
County Administrator Robert Davis said if commissioners chose to pursue it, such a tax would have to go to voters under a requirement of the county charter. He also said the board would have to consult with cities, which also might choose to impose similar taxes.
Metro, the regional agency, also is considering such a tax.
Board Chairman Andy Duyck said he dislikes the idea.
"It's a tax somebody else pays," he said. "We can negate our own responsibility for housing and say it's the man behind the tree who pays for it."
Reviving a levy?
Duyck said an alternative is a countywide tax levy, which the commissioners shelved after a telephone survey indicated only 52 percent support at best. Public support for tax measures usually decline during a campaign leading to the election.
The levy was envisioned at 34 cents per $1,000 of taxable property value.
Washington County Thrives, a coalition of nonprofit groups and public agencies that includes the county, considered a levy as a way to raise money for housing projects and two other priorities — early childhood and workforce training programs.
Duyck said he thinks public support could be mustered for it in a current effort to inform city councils.
Metro is also considering a regional bond issue for housing.
A levy would be limited to five years, but it could be renewed.
Commissioners have aided nonprofit groups build housing by transferring surplus land and helping pay systems development charges and transportation development taxes, usually by tapping the county general fund that supports other services.
A construction excise tax or countywide levy would be an alternative to relieve spending from the general fund.
Housing is deemed affordable, under a federal definition, if rent or mortgage costs consume less than 30 percent of household income. But according to the 2017 county budget message Davis presented on May 9, almost 40,000 households pay more than 30 percent.
One estimate put the shortage of "affordable" housing at 14,000 units, although Commissioner Greg Malinowski said he thinks the real figure is much higher.
He referred to Oregon Employment Department figures from 2013, when about 53 percent of Washington County's 284,238 workers earned 60 percent or less of the county's median household income. (The median household income — the point where half the households earn more and half earn less — was $70,300 in 2016.)
He said it can be safely assumed that virtually all of those lower-income earners live outside Washington County because of housing prices — and new county money could support a continuous revolving-loan fund for housing.
"Maybe they would live here if we had a place for them to live," he said.
But Terry said that in his district, which covers western Washington County, many people choose to live there and do not want to be closer to the urban core.
Commissioner Roy Rogers said housing was a complex problem with many facets.
He said another big problem is the lack of housing available for people who earn too much to qualify for subsidized housing, but not enough to afford current market-rate housing.
"It is disturbing to have people in their 20s and 30s say they cannot afford to live in Washington County," he said.