Portland is experiencing a dire shortage of affordable housing, but not one that is unique to the city. The housing crisis, as it has become known, is a regional issue of historic magnitude that is felt throughout the Pacific Northwest.
“The lack of housing opportunity is impacting communities throughout Oregon,” said Jenny Lee, housing policy director at Neighborhood Partnerships, in an email to Street Roots.
“The number of people experiencing unsheltered homelessness is rising steeply, not only in cities like Eugene, but along the coast and in rural areas. A growing number of people have no option but to live outside in tents or RVs. This winter, a man experiencing homelessness died of hypothermia in Medford. In Roseburg, almost two-thirds of renters are cost-burdened, meaning families struggle to make ends meet. In Tillamook, businesses worry that they cannot retain workers due to housing costs. In counties from Columbia to Wasco, many families receiving housing assistance can’t find a rental on the market.”
The real estate, housing and construction industries have rebounded since the end of the recession. That, combined with population growth in many West Coast cities, has created a white-hot housing market driving up rental costs and home prices. Vacancy rates — the measure of how many rental units are available — have dropped to unheard of rates of less than 2 percent. People are being displaced from homes they may have lived in for years, increasing their commutes to work and school, and other low-income people are unable to find a home they can afford at all.
Urban homelessness and poverty has existed in large numbers since the 1980s, but, by and large, cities and counties have done little to preserve existing affordable housing or build more.
Putting a levy on Portland’s 2010 ballot to create an affordable-housing fund was discussed among some elected officials and housing advocates. But there was worry that an affordable-housing levy could not compete with renewing the parks bond, and the effort failed.
Hesitation to fund affordable housing no longer exists.
“It’s come to an undeniable head on the West Coast. It’s freaked out such a broad swath of people. The problem is so clear and undeniable,” said Michael Anderson, a consultant with the Center for Community Change who has worked with cities and jurisdictions throughout the country to find sources of revenue for affordable housing. “There is appropriate urgency now.”
Marty Kooistra, the executive director of Seattle’s Housing Development Consortium, an advocacy organization, said the organization thought about creating a public awareness campaign about the importance of affordable housing.
“We don’t feel like we need to do that anymore,” Kooistra said. “It’s talked about everywhere now.”
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Cities and counties throughout the West Coast are putting bonds, levies and other property tax measures on their local ballots to create a dedicated revenue stream to build affordable housing — an unprecedented effort on the part of local governments to fund housing that is affordable to their communities’ lowest-income residents.
“You have to have a crisis before you solve it sometimes,” said Andy Silver, executive director of Vancouver’s Council for the Homeless. “It’s always been an issue before, but it’s just gotten worse.”
Bend’s housing shortage
Bend is the fastest-growing city in Oregon, and the shortage of affordable housing in central Oregon reflects that; Bend’s vacancy rate is less than 0.5 percent.
“It’s almost non-existent,” said Jim Long, the city’s affordable-housing manager. “There may be 20 units available to rent.”
The average rent for a one-bedroom apartment in Bend is $1,600 a month.
“It’s more than a mortgage,” Long said.
Over half of the renters in Deschutes County pay more than 30 percent of their income for housing costs, the federal standard for housing affordability, and about a third of renters pay more than 50 percent of their income for housing, which is considered rent-burdened.
“People want to be here,” Long said, citing the city’s recreational opportunities and natural setting. “Even during the economic downtown, we grew by 3 percent. Not a single multi-housing permit was built down here then, but people kept moving here. People with money are moving to Bend, but what that’s creating … is that you’re priced out of a place to live here.”
Between 2014 and 2015, the number of homeless people living in Deschutes, Jefferson and Crook counties nearly doubled.
According to the Central Oregon Homeless Leadership Coalition’s Point-in-Time Count conducted in January 2015, the most recent data, there were 2,087 people who slept outside, couch-surfed with friends or family, or lived in their car in Deschutes, Jefferson and Crook counties. In 2014, there were 1,217 homeless people living in Central Oregon.
Long said that nearly 90 percent of Central Oregon’s homeless population are from the area. The shortage of housing “is pushing them to the margins,” he said.
He said Bend’s City Council has taken aggressive steps to build more housing. The council passed a construction excise tax that generates approximately $1 million a year. The city encourages building more densely; building smaller, cottage-style housing communities; and making it easier for homeowners to build accessory dwelling units, or ADUs.
Vancouver, Wash., responds to crisis
Vancouver is the fourth-largest city in Washington, but it feels more like a large, sleepy town. The housing crisis came to Vancouver in late 2014 with a ferocity no one expected.
Vancouver’s vacancy rate is below 2 percent. The city has one of the fastest-growing rental costs in the nation; from 2014 to 2015, rental costs increased 15.6 percent. According to the city, household income rose by an average of 3.1 percent in the past five years, but average rental costs have increased by 38.3 percent.
There are approximately 80,000 households in Vancouver, according to city figures. A little over 16,000 households spend more than 30 percent of their income on housing costs. Approximately 7,100 households are rent-burdened, spending more than 50 percent of their income on housing costs.
The demand for subsidized and Section 8 housing is so high that the Vancouver Housing Authority no longer employs a wait list. Instead, the authority now gives any open units to the most vulnerable and at-risk.
Homelessness has also markedly increased by at least 11 percent; there are now 690 homeless people living in Clark County, according to preliminary numbers from Vancouver’s Council for the Homeless. The number mirrors research published in the Journal of Urban Affairs in December 2013, which found that a $100 increase in monthly rent corresponds to a 15 percent increase in urban homelessness and a 39 percent increase in rural areas.
“There is a correlation,” Kooistra said, noting an average rent increase of $115 a month in Seattle’s King County.
Vancouver has also experienced mass evictions. In late 2014, the landlord of the Courtyard Village Apartments, a 16-apartment complex, gave a 20-day no-cause eviction notice to everyone who lived in the complex in order to renovate.
In response, the Vancouver City Council passed ordinances in September 2015 to require a 60-day notice for no-cause evictions, instead of 20 days; a 60-day notice for rent increases of 10 percent or more, instead of 20 days; and to prohibit landlords from discriminating against prospective tenants because of the source of their income, such as Section 8 vouchers.
On April 11, the City Council declared an affordable-housing emergency, the first step to putting a property tax measure on the ballot.
In early May, the council is expected to decide the details of how much to tax and for how many years. The maximum amount the city could pursue would tax 50 cents per $1,000 of assessed property value, but it is more likely that the council will propose a tax of 36 cents per $1,000 of assessed value — a tax of approximately $90 for a home worth $250,000, the median home value in Vancouver.
If passed, the levy would raise approximately $6 million each year for seven years, a total of about $40 million, and pay for building new affordable housing, preserving existing housing, and homeless prevention services. The levy’s funds would help people who earn 50 percent of median family income, or about $33,750 for an individual.
The Council for the Homeless is the nonprofit organization spearheading the levy campaign. Silver, the organization’s executive director, expects the levy to be approved.
“The housing crisis has affected so many people that housing is one of the major issues in our community,” he said.
Silver said the levy, if passed, could leverage an additional $200 million in state and federal dollars.
“What we’re asking from the voters is for this very small investment on the front end; we can get this huge $200 million investment in affordable housing. When they hear that, when the housing crisis is affecting all of our community, it will be an easy vote,” he said.
“It’s the right time to do this. The need is in our community and is only going to get worse without action.”
Seattle sets an example
Historically, Seattle has been the only city on the West Coast to have a dedicated stream of revenue for affordable housing. Since 1981, Seattle’s Housing Levy has been approved five times by voters in large margins. The levy has generated $400 million, and the levy has leveraged other state and federal dollars to build over 12,500 apartments affordable to formerly homeless individuals and families, seniors and workers who make low and moderate wages. The levy’s funds have also provided home-ownership assistance to over 800 first-time homeowners and prevented homelessness or displacement of more than 6,500 low-income households by providing emergency rental assistance.
Despite those efforts, more than 45,000 households in Seattle are rent-burdened, according to the city, and more than 2,800 Seattle citizens are homeless.
The city is taking even more aggressive steps to build and preserve affordable housing. In late 2014, Seattle Mayor Ed Murray convened the Housing Affordability and Livability (HALA) Committee, which was charged with developing an agenda for increasing affordability in Seattle.
In 2015, the group released its recommendations, which the Seattle City Council accepted in September 2015. Recommendations include a brokered agreement between the city, housing advocates, real estate and development industries that has become known as the HALA Agreement.
The HALA Agreement calls for building 50,000 new homes in Seattle in the next 10 years; 30,000 of those units will be market-rate, and the other 20,000 units will be affordable to people who make 30 percent of the median area income, or $18,850 for an individual and $26,900 for a family of four.
Building 50,000 homes within 10 years will require tripling the historical amount of housing construction in Seattle, making it an ambitious goal. But the HALA Agreement also includes regulations on development and creating different revenue streams that will allow for increased construction.
The agreement requires mandatory inclusionary housing throughout Seattle and requires developers to reserve 5 percent to 7 percent of units in every new multifamily building, which will be affordable to people who earn up to 60 percent of King County’s median family income, which is $37,680 for an individual and $53,760 for a family of four.
The agreement also created a commercial linkage fee, which charges between $5 and $14 per square foot of any new commercial development. The fee will be phased in over three years and will fund affordable housing for severely low-income families and individuals.
The HALA Agreement, Anderson said, “puts (Seattle) way ahead of every city on the West Coast.”
Kooistra, of the Housing Development Consortium and a member of the HALA Committee, said the agreement is a victory.
“The entrenched embattlement between mandatory versus voluntary (regulatory) stuff has been going on for 20 years,” he said. “The battle lines were already drawn when we started.”
He went on to say that the 20,000 units of affordable housing is still “significantly short of what we really need. It is, conversely, three times what we have ever done. Is it enough? No. But it will certainly help.”
Seattle’s Housing Levy is up for renewal this year, and the city is proposing that voters double the levy, another recommendation of the HALA Committee. The doubled levy would generate $290 million in seven years by taxing 26 cents per $1,000 of assessed value, or about $120 for an owner of a $480,000 home (the median home value in Seattle).
The Housing Development Consortium is leading the campaign to renew the levy, and Kooistra thinks the levy will easily pass and be doubled.
“The levy,” he said, “does ask people to contribute, but it is a way for people to say they’re all doing something for families below 30 percent of MFI,” or median family income.
Other Washington cities are following in Seattle’s footsteps. In 2012, 56 percent of Bellingham voters approved a seven-year levy, the Bellingham Home Fund, that taxes 35 cents per $1,000 of assessed value, which has created 500 units of affordable housing.
Everett, Tacoma, Tumwater and Lacey, cities in the Seattle metropolitan area and along the Interstate 5 corridor, are planning to introduce ballot measures to create funding for affordable housing in time for the November 2016 ballot.
In late January, over 300 people attended a housing summit hosted by Skagit County’s public health department. It was the first time that such a meeting had been organized in Skagit County, a rural, northern Washington county between Bellingham and Seattle. The vacancy rate is less than 2 percent, and there is little to no vacancy in subsidized or nonprofit-owned affordable housing. Homelessness is increasing.
Speakers presented various options for raising money to build more affordable housing, including placing a property tax measure on the November 2016 ballot. Some members of the audience, which included city and county elected officials, recommended hiring a political consultant firm, Progressive Strategies Northwest, to analyze the feasibility of placing the tax measure on the ballot. The consultant firm, based in Seattle, would charge $2,000 to conduct the study.
When attendees heard the number, they reached for their wallets. More than a dozen people pulled out tens, twenties and other dollar amounts to pay for the study that night.
Cities in California are also beginning to act. Los Angeles County government unanimously voted to commit $300 million to build affordable housing over the next five years. San Jose City Council created a “housing impact fee fund” in 2014 that charges $17 per square foot on new market-rate developments.
The voters of San Francisco – a city infamous for astronomically high housing prices, gentrification and displacement – passed a bond measure, by a 74 percent margin, that authorizes the city to issue up to $310 million in bonds to fund affordable-housing programs.
“Cities and counties are getting serious about what they need to do,” Anderson said.
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Multnomah County taking note
Oregon has long been a state that is wary of tax increases. In 1990, voters passed Measures 5 and 50, which limit the amount properties can be taxed to a maximum of 10 percent per $1,000 of assessed value. Because of that, levies, in particular, can be hindered by “compression,” which shrinks the amount a levy can generate if there are too many levies that generate revenue through property taxes.
But that may change in Multnomah County.
“For the first time, we have the attention and support of the voters,” said Jes Larson, director of the Welcome Home Coalition.
Larson said the coalition is beginning to organize a campaign for an initiative it hopes will be on the November 2016 ballot, which will ask voters to fund general-obligations bonds for affordable housing in Multnomah County.
Last year, the average rent in Multnomah County increased by an average of $104 a month.
Larson said that while details behind the initiative and campaign are still being determined, the initiative will go to Multnomah County voters and will target creation of affordable housing for people who make between zero and 30 percent of median family income.
“We know that the greatest need for affordable housing is for community members who live on fixed incomes and people who are raising families on very low incomes,” Larson said. “The need is everywhere. We would do the state of Oregon if we could pass it.”