New Legislation Addresses Oregon Housing Crisis

By Mick Harris

Last week, the Oregon Legislature took a significant step to address Oregon’s ongoing housing crisis, as Governor Tina Kotek signed a robust legislative housing package into law. Two pivotal measures, Senate Bill 1537 and Senate Bill 1530, topped the Governor’s priority list in the 2024 legislative session and garnered bipartisan support in both chambers prior to heading to the Governor’s desk for signature. These bills, coupled with House Bill 4134, are aimed at significantly alleviating the housing crunch.

Governor Kotek clearly understands the urgency of tackling the burdensome cost of housing. In a statement issued following the passage of this legislation, she stated, “Oregonians are struggling under the pressure of an increasingly unaffordable housing market. After hearing this concern directly from Oregonians from across our state last year, I knew we had to make major progress on our housing crisis during this year’s legislative session.”

Regarding the impact this legislation will have on the housing market, local realtor Seth Prickett of Mahonia Realty spoke positively, stating, “It is really refreshing to see both parties come together on an issue. I think that is a sign of just how important the housing issue is to our state. This is not a turnkey solution for all of our housing shortage issues but it is a great start. I am eager to see what projects the $75 million revolving loan fund creates because it is tailored for local communities to focus on their particular needs.”

Senate Bill 1537 will appropriate $258 million for the implementation of various state programs, including as follows:

To Oregon Housing and Community Services:

• $65 million for emergency shelters
• $40 million for the Oregon Eviction Diversion and Prevention and Eviction Prevention Rapid Response programs and services administered by culturally responsive organizations
• $10 million to acquire land for affordable housing
• $5 million for individual development accounts
• $2 million to support residents whose housing is being withdrawn from publicly supported housing, or is within a manufactured dwelling park being sold or closed

To the Oregon Department of Administrative Services:

• $100 million for infrastructure projects supporting housing development
• $1 million for a nonprofit to donate reused household goods and furnishings to low-income residents

To the Oregon Health Authority:

• $18 million for recovery housing projects
• $7.5 million for the Healthy Homes Repair Fund
• $3.5 million for the Air Conditioner and Air Filter Deployment Program

To the State Department of Energy:

• $4 million for the Residential Heat Pump Fund

To the Department of Human Services:

• $2 million for emergency warming or cooling shelters

Recognizing that cash appropriations were only a piece of the puzzle, the Legislature also passed Senate Bill 1537 to create new administrative infrastructure and modernize land use policy to stimulate the production of affordable housing by:

• Establishing the Housing Accountability and Production Office (HAPO) and directing HAPO to assist local governments with housing production
• Requiring local governments to grant land use regulation and design adjustments in certain circumstances and modifying the definition of limited land use decisions
• Allowing housing permit applicants to opt in to amended housing regulations and expanding eligibility of prevailing applicants for housing development to receive attorney fees in a Land Use Board of Appeals review
• Establishing the Housing Infrastructure Support Fund to provide capacity and support to municipalities for the planning and financing of infrastructure for housing unit production, as well as the Housing Project Revolving Loan Fund to cover eligible developer costs, including infrastructure and system development charges, predevelopment costs, construction costs, and land write-downs
• Allowing cities to undergo either a one-time urban growth boundary amendment or a land exchange in specified conditions

House Bill 4134 also deserves honorable mention for appropriating approximately $21.3 million in general funds to the Department of Administrative Services for infrastructure grants to specified cities. It requires that infrastructure projects receiving funds must support housing developments in which at least 30 percent of the units are affordable to households earning 130% or less of county median income.