Affordable housing

Dean Guernsey/for The Bulletin

Excavation is shown well underway Tuesday on the 240-unit affordable housing complex called Stillwater Crossing at the south end of Bend. The project received 240 of Bend Park & Recreation District’s 400 affordable housing waivers for system development charges last year, which prompted the park district to restructure how additional waivers will be issued.

The Bend Park & Recreation District increased the number of fee waivers it will give to developers who build affordable housing for the next two years, but fell short of answering the city of Bend’s original request to remove a cap on these fee waivers entirely.

In a meeting Jan. 5, the park board unanimously approved waiving system development charges, or SDCs, for 150 more future units of affordable housing.

The approved resolution is seen by most on the board as a compromise to help remove barriers to affordable housing while also not losing too much revenue from the fees, which help pay for the construction of new parks and other infrastructure. But some still feel the district could do more to help one of Bend’s most pressing issues.

As a part of a pilot project prompted by the city, which waives SDCs for all affordable housing projects, the district agreed in 2019 to waive these fees for up to 400 units of affordable housing through 2022. The idea is that waiving these fees removes financial barriers for affordable housing projects, which often struggle to pencil out due to high land costs and lower rents to recoup costs. The {span}average SDC rate for a multifamily unit is $5,644, the park district estimates.{/span}

But the district nearly reached its cap by the end of 2020, with 380 of those waivers already allocated and two years of the pilot program left to go, prompting the city to ask the district to remove it’s 400-unit cap.

This happened in large part because an unexpectedly large, 240-unit affordable housing project, called Stillwater Crossing, came to south Bend and received more than half of the waivers, said Michelle Healy, deputy director of the park district. Before that, Bend was averaging roughly 50 affordable housing units a year, she said.

“I think no one foresaw the large one that came through,” Healy said Tuesday.

So this time, the park board decided to cap this year and 2022 to 75 waivers each. The number of waivers was based on a project list the district received from the city this fall, showing 150 affordable housing unit projects in the pipeline, Healy said.

The goal would be to prevent one large project from receiving the majority of waivers, and instead encourage a variety of smaller affordable projects from different developers, Healy said.

Incentivizing smaller projects also helps integrate more affordable housing throughout Bend, rather than encouraging development of affordable or low income housing all in one area of town, said board member Ariel Mendez.

Mendez said it was important to him to incentivize development that does not segregate the community by race and class, and that his goal is not to prevent any affordable housing units to be built, but to provide incentives for “the best result.”

“This is not just about building homes,” Mendez said at the Jan. 5 meeting. “This is also about building communities.”

The board also passed a proposal from Mendez that allows some affordable housing units to not be subject to the district’s 75-unit cap. In a market rate multifamily housing project, up to five affordable housing units could be added with no fee charged.

“I’m just trying to find a way to incentivize the kind of development that might be the most conducive for mixed income (development),” Mendez said during the meeting.

The cap is seen by many on the board as a way to help promote affordable housing without letting the quality of service in parks decrease dramatically. Even so, the 150 fee waivers will result in the district not receiving roughly $875,000 to $1.2 million in system development charges, Healy said.

But board member Jason Kropf, a Democrat elected last year to represent Oregon’s 54th House District, opposed having a cap on affordable housing waivers, despite eventually voting to approve the resolution in the end.

Kropf argued the lack of affordable housing in Bend is “a paramount issue,” and that the park district has a responsibility to help address it — especially if the district is serious about its priority to support the health and well-being of the community.

“You can have wonderful parks,” Kropf said on Jan. 5. “If more and more people don’t have places to live, then we’re not going to be a community where people have health and well-being.”

In response to financial concerns, Kropf said an estimate for construction of Alpenglow Park coming in roughly $1 million under the anticipated estimate for the project gives the district “room to contribute to large … community issues.”

Kropf also warned that the 150-unit cap will not be enough to meet the needs of the community. Updated estimates from the city suggest there could be between 380 and 400 units of affordable units in the pipeline in the near future, he said.

“I want us to be fully prepared that we aren’t meeting the full need of this community and be prepared to work with the city before the end of 2022,” he said.

The idea of adding more waivers also has community support. Since November, the district has received 81 letters of support for more fee waivers compared with 28 letters that were against the idea, according to Sheila Reed, an executive assistant with the district.

Bend Mayor Sally Russell said Tuesday she had not had a chance yet to review the final resolution, given that the district’s legal team is still finalizing the details, but in general applauded the park board with moving forward.

“I’m so happy that the parks board invested time and energy to really understand the gravity of the situation,” Russell said.

When asked whether it was still a goal to convince the district to lift a cap entirely, she said that was a conversation for the new council to have. Both Russell and the park board expressed intentions to have more conversations about long term solutions regarding affordable housing and SDCs.

Reporter: 541-633-2160,

bvisser@bendbulletin.com

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