By Katy Brooks, CEO

This article first appeared in The Bulletin on July 16, 2023

The 2023 session’s clarion call for housing brought forth a variety of legislation that reflected the broad and deep housing needs of our state. It was an attempt to attack the issue on many fronts, but was it enough to get the housing production flywheel spinning?

The Legislature’s injection of $2.5 billion for Oregon Housing & Community Services (OHCS) was the most significant indication that the state is serious in its attempt to put us on a path toward shoring up our state’s housing crisis.

The success of this session’s legislation will play out differently across the state. In Central Oregon, we are 11,000 homes short of our current need, and the number of unhoused people is growing fast. And although we will see visible benefits, the path to a stable housing inventory will take years of investment.

It will also require additional buildable land — something Gov. Tina Kotek and many communities in Oregon were counting on through House Bill 3414.

It was supposed to alleviate the need for more buildable land to meet housing projections by allowing cities modest annexations of urban reserves, but failed to pass the Senate the last day of session. We hope this will be taken up in the next session.

Still, the 2023 session will undeniably get us moving in the right direction for all kinds of housing, including our growing unhoused population. Senate Bill 5511 invests more than $132 million in emergency and transitional housing to support the governor’s emergency declaration on homelessness. This includes additional shelter beds, rehousing and navigation services, among other projects along the continuum of care.

There was also funding for Oregonians who have a dream of home ownership.

In Central Oregon, this is one of the most profound changes to our community in recent years. The cost of home ownership is out of reach for so many people who work here.

In Bend, only 8% of the population can afford to purchase a home mainly due to the high cost of down payments associated with skyrocketing home prices.

To help with this, nearly $10 million was set aside by the Legislature to help build attainable bridge financing for permits and other pre-development costs to lower the overall cost of the home. The Legislature went further to address the issue of high buying costs, including $7.5 million for down payment assistance. This type of funding can have a profound benefit for people who could make monthly mortgage payments but have no hope of accumulating what is needed for a down payment.

This year’s legislation also invested in creative housing models. For example, several projects were built in Central Oregon this year on deed-restricted property that provide subsidized, low-cost homes that can only be sold to local workers. A similar model has been created by Deschutes County to form a trust fund to lower the cost of building for new homes, ultimately helping create more mid-market home ownership.

This model could be supported by SB 5511, which provides $20 million for the development of alternative homeownership models, including co-ops and community land trusts, and another $20 million in bonds for home ownership.

These projects can leverage more funding from non-profits and the private sector to bring home ownership to even more Oregonians.

Local governments now have a new tool in their toolbox with Senate Bill 919, which allows for a five-year property tax exemption for new middle housing units occupied as a primary residence. This means a break on property taxes for creating density via duplexes, ADUs and other types of “middle housing.”

Many funding decisions were made in the waning days of the 2023 session as legislators combined budget priorities and state bonding authority into omnibus bills, including appropriating $600 million for the acquisition and construction of affordable housing, including federally subsidized housing, which is projected to incentivize the construction of almost 3,000 rental units and more than 380 homes.

This year’s legislation will have impacts that are widespread. It may not result in the Governor’s goal of 36,000 housing units per year, but it will hopefully be enough to see real progress. And in Central Oregon, this is even more pressing as we continue to watch property costs rise and housing availability wane.