Coalition backing Portland's $258.4 million housing bond confident amid criticism

Right of Return

North Williams Avenue (shown here) along with North Vancouver Avenue in late fall 2015, once home to black businesses and clubs, are now the site of construction cranes and trendy restaurants. Portland's affordable housing crisis hasn't improved, despite construction cranes throughout many central city neighborhoods.

(Kristyna Wentz-Graff)

Israel Bayer, executive director of the Street Roots newspaper, admits the city's chamber of commerce may not seem like a natural political partner for his homelessness and advocacy organization.

In 2013, the Portland Business Alliance lobbied to give Portland the power to ban homeless people from sitting or lying on sidewalks. This year, Clean and Safe, a nonprofit managed by the PBA, paid for a controversial billboard that suggested panhandlers are addicts.

But the strange bedfellows are walking hand-in-hand this fall -- backing a $258.4 million affordable-housing bond on the Nov. 8 ballot that would mark an unprecedented gusher of construction cash for the region and cinch a rare moment of unity in an often-fraught discussion over homelessness and housing policy.

They're not alone. The chamber and weekly newspaper are two of the disparate groups backing Measure 26-179. The campaign pulled in close to $400,000 in the past few months from politically connected developers, nonprofit housing agencies, union groups and elected officials.

The measure would fund some 1,300 affordable units, set aside for some of the poorest Portlanders. It comes one year after the City Council declared a state of emergency over homelessness -- heading to voters amid the crescendo of a statewide housing crisis.

"If Street Roots and the PBA can be working together on something," Bayer said, "then you can be sure that it's a good thing and that we're going in the right direction."

While no opponents have rallied to fight the measure, it has faced criticism. The number of units expected to be preserved or built pales in comparison to the city's 24,000-unit housing shortfall, and an estimated cost of nearly $200,000 per unit has raised eyebrows.

Plus, the number of new units accommodated under the plan is less than 1,300. That's because hundreds of low-income residents who use housing vouchers to subsidize rents in private housing will be shifted to public housing.

Eric Fruits, an economist who fought the city's 2014 street fee proposals, says officials should go back to the drawing board. He said other cities have raised less money but promised more units. Fruits cited Denver, which expects to preserve or build 6,000 affordable units for just $150 million.

"They're doing something different that costs less and helps more people," he said.

Bayer said Portland's bond is "a matter of life and death" for the roughly 3,000 people who could be housed or stay in existing housing as a result of the bond. Units will be affordable for those earning less than 30 percent of the median family income, or about $22,000 for a family of four.

Backers say the 20-year plan would cost about $75 annually for a home assessed at $178,000. That's roughly the cost of Portland's arts tax for two adults.

Related: Don't Portland homes cost more on the open market? Yes, but that's not the calculation used to levy property taxes. Curious about your assessed property tax value? Check out our reporting on the issue, or plug in your home address on PortlandMaps.com and see for yourself.

"The cost of doing nothing is 10 times more expensive than the cost of being able to deliver this bond to the community," Bayer said.

Commissioner Dan Saltzman, who oversees the city's Housing Bureau, said the bond is the culmination of "substantial investments" in recent years by the city and Multnomah County.

The City Council voted to direct $67 million in additional urban renewal money to affordable housing projects in the next decade. It approved a construction excise tax this summer that's expected to bring in millions of dollars more for housing projects. The city is also spending tax revenue from short-term rentals on affordable housing.

Saltzman said local government is doing its share, with an estimated 2,000 affordable units already under construction or in development.

"Now it's time to ask voters to step up," Saltzman said.

Fruits agrees that the city has taken action. But he called the city's $200,000 per-unit subsidy "bizarre."

"There's a lot of bucks, and not much bang with this measure," he said.

Although city officials have said the bond would pay for 1,300 units, their proposal would expand Portland's affordable housing reach by only 900 net units.

That's because Home Forward, the housing authority that serves Multnomah County, has pledged to redirect some of its existing resources serving low-income families.

About the bond: Inside the numbers

$258.4 million over 20 years

$75 - Average cost per year to Portland homeowner (with a home valued at $178,000)

1,300 - Number of units expected to be built or preserved

600 - Number of units targeted to the poorest Portlanders who earn less than 30 percent of the median family income

$0.42 - Tax rate per $1,000 of assessed value for Portland homeowners

Home Forward plans to shift 400 vouchers from its existing Section 8 program to buildings owned by Portland. Those 400 vouchers would no longer be used by families seeking housing in the private market. Instead, the city would set aside 400 units for families within the voucher-program -- and receive an estimated $3.15 million a year from Home Forward to cover costs.

Saltzman said the city needs Home Forward and its vouchers to meet its goal of having roughly half of the units funded by the bond serving people earning less than 30 percent of the median family income.

Sandra McDonough, the PBA's president, said the organization of more than 1,850 businesses didn't take its endorsement lightly.

"We know that housing and homelessness is the number one issues in Portland right now," she said. "It's what we hear from voters and what we from our businesses."

Housing costs for median renters in Portland rose 30 percent in the past 15 years while income rose just 7 percent, according to the voter's pamphlet.

More than 100 groups of businesses and organizations support the initiative, and that bears out in the voter's pamphlet. A dozen groups filed letters in support of the plan, while no organization or individuals wrote in opposition.

McDonough argues the public sector must step in and support seniors and others on poverty wages. "To get them into housing you're going to need a public subsidy. The market on its own is not going to develop the very low income housing, so you need a public subsidy," she said.

If the bond passes, the City Council will appoint a five-person oversight panel to monitor spending and individual projects. Bond proceeds will also pay for buying land to build new housing.

McDonough said the business alliance will stay involved and watch spending if the bond passes.

"We think there are places where they can save money," she said.

And while other measures on next month's ballot might cause angst on Election Night-- like Measure 97, a proposed $3 billion-a-year gross receipts tax on large corporations -- backers of Portland's affordable housing measure say they're confident.

Everyone can agree, argued Street Roots' Bayer, that the city's most vulnerable residents need help. He said he's cautiously optimistic voters will "rise above the noise and vote their values."

"This is not just a statement about today," Bayer said, "this is a statement about tomorrow."

Saltzman cited the measure's broad support along with polling results showing its popularity.

"I think we're going to win," he said.

The Oregonian/OregonLive's Brad Schmidt contributed to this report

-- Andrew Theen

atheen@oregonian.com
503-294-4026
@andrewtheen

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