Kotek sends ‘top priority’ homebuilding bill to legislature

Home construction
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Gov. Tina Kotek is calling on the Oregon legislature to back a new proposal to significantly boost homebuilding, calling it her “top priority.” Kotek says Senate Bill 1537 is aimed at cutting into the state’s housing shortage.

The bill includes a $500 million investment package from existing state resources for housing production. She also wants to allow cities to grow their urban growth boundaries if they need more land for housing.

“Decades of underbuilding have left Oregon with a severe housing shortage that is driving up rents, home prices, and worsening our homelessness crisis,” Kotek said in her announcement. “People that are ready to transition out of homelessness struggle to find housing. Meanwhile, employers – both public and private – in Oregon struggle to hire due to a lack of workforce housing for rent or purchase, harming local economies across the state. That’s why SB 1537 is my top priority in the short session, and I look forward to working with legislators to make progress this year.”

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Below is a summary of key provisions in SB 1537, provided by Gov. Kotek’s office.

Housing Accountability and Production Office
 
Creates the Housing Accountability and Production Office (HAPO) to support housing production in local communities with a more definitive structure and process to address complaints, concerns, and issues from local governments and developers about compliance with state housing law. This office will enhance opportunities to collaborate with local governments in lieu of enforcement actions.
 
Land Supply
 
Provides a one-time tool for cities in need of land and affordable housing to add land for housing to their urban growth boundary (UGB). Any land added would need the consent of the property owner and could only be urban reserve, non-resource land, or exception land – not high value farm or forest land except land in urban reserves already designated for future urban development. A city must meet land and affordability eligibility metrics in order to qualify to use this tool.
 
Housing Affordability
 
Requires a portion of new development to be affordable. Within any expansion areas, 30% of all housing units must be legally restricted for affordable housing. Affordability requirements exist in over 800 jurisdictions and 25 states, but most programs require between 10-20% of units as affordable. A 30% requirement in Oregon would be one of the strongest requirements in the country. Oregon has a critical need for guaranteed affordability, as existing land within UGBs (outside of Portland) has no affordability requirement.
 
Climate-Friendly Homes
 
Funds grants for new affordable housing construction to incorporate energy-efficient design, reduce energy costs for low-income residents, and stabilize operational costs for owners. These incentives will help reduce the energy burden for low-income Oregonians across the state.
 
Funding for Housing Production Tools
 
SB 1537 includes a $500 million investment package from existing state resources requested by Governor Kotek. Here is an initial breakdown of that funding:

  • Housing infrastructure financing: $200 million
  • Moderate-income housing financing: $200 million
  • Site acquisition: $40 million
  • Climate-friendly incentive funding: $20 million
  • Site mitigation and readiness funding: $10 million
  • Local housing planning technical assistance funding: $10 million
  • Local housing infrastructure planning capacity: $5 million
  • Housing Accountability and Production Office: $5 million

Bills, including SB 1537 (LC 19), will be publicly posted on the Oregon legislative website closer to the start of the 2024 legislative session. The Governor’s Office does not dictate when items are posted to the legislative website for public inspection.
 
Additionally, the Housing Production Advisory Council (HPAC), which Governor Kotek created through Executive Order 23-04 last year to develop long-term strategies for ramping up home construction across Oregon, will present their final recommendations to the Governor today. SB 1537 is separate from the Housing Production Advisory Council recommendations, which can be found here.

 

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