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Oregon Legislature unlikely to make major housing production reforms this year

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Oregon State Capitol STOCK

Oregon elected officials and community leaders agree the state has a housing shortage that is fueling homelessness and an affordable housing crisis. But the Legislature will not consider a comprehensive proposal to significantly increase housing production until 2023 at the soonest.

That was one takeaway from the 2022 Housing Economic Summit held online Thursday. State Rep. Julie Fahey, chair of the House Interim Committee on Housing, told attendees that lawmakers will not have enough time to consider such a proposal during the session that begins on Feb. 1 because it is limited to just 35 days.

"2023 is a year away and a year is not that long of a time," said Fahey, a Democrat who represents Eugene and Junction City.

Fahey spoke at the end of the conference and her comments likely disappointed some of the participants. During a series of panel discussions, numerous speakers said the statewide housing shortage is driving up prices, increasing the number of those living on the streets and preventing many people of color from purchasing even a starter home to begin building wealth.

The discussions also revealed tensions between policy makers and home builders that the Legislature could address. They included questions of whether the state's existing land use planning laws are limiting the availability of buildable land, how much government infrastructure charges are increasing housing costs and whether well-intended policies to increase energy efficiency and fight climate change are pushing prices too high.

"For every $1,000 of additional cost, 1,578 Oregonians are priced out of the market," said Geoff Harris, customer experience director for Hayden Homes, which builds workforce and middle income housing, including cottage clusters and small multi-family projects.

Fahey admitted that the Legislature needs to discuss such issues while preparing a comprehensive proposal to increase housing production. But she said it will take a focused effort involving all parties, who must be willing to compromise.

State Sen. Dick Anderson, vice-chair of the Senate Interim Committee on Housing and Development, agreed.

"From what I see, it will take a great deal of energy and focus and time," said Anderson, a Republican who represents the central coast.

Both Fahey and Anderson said the 2022 Legislature could take up smaller bills to address the housing shortage, however. Fahey said she expects a substantial affordable housing funding package to be considered. Anderson said his committee will introduce a bill to better enforce a previous legislative requirement that governments prepare an analysis of how new housing policies will affect home prices.

In the meantime, Fahey said she believes elected officials should change the discussion about where housing should be built.

"The root cause of our housing crisis is the lack of supply. We need to build more housing, and sometimes that means build more housing next to you," Fahey said.

The summit revealed that local officials across the state are very aware of the housing shortage and are working on local proposals to increase production. Gresham Mayor Travis Stovall moderated a panel that included Gresham City Planner Eric Schmidt and Medford Planning Director Matt Brinkley. They listed initiatives each city has undertaken over the past year, including a housing developer summit with 60 participants in Gresham and the adoption of a master plan with 37 strategies in Medford.

Both cities have also completed a housing capacity analysis required by the 2020 Legislature that determined they have enough buildable land within the state-required urban growth boundaries for the next 20 years. Harris questioned whether that is actually true in any city, however, saying that much of the land considered buildable by governments has problems — from bad soil to steep terrains — that limit how much housing can actually be built on it.

Other problems cited by panelists include slow permitting approval processes that add weeks and even months to the start of construction. Even the slightest delay is especially problematic now because inflation is increasing construction costs, while COVID-19 is making it difficult for developers to find as many workers as they need.

The summit was sponsored by the Oregon Bankers Association, Oregon REALTORS®, and the Oregon Home Builders Association. It featured nationally recognized speakers as well as local experts in the areas of housing, regulation and economics, and a variety of issues that will impact housing in Oregon in 2022 and beyond.

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