The city of Bend, as well as housing and homeless advocates, are again asking the Bend Park & Recreation District to waive a fee that is charged to developers in an effort to promote more affordable housing.
These fees are called system development charges, or SDCs, which the park district charges to developers to pay for new parks and new trails . Last year, the district agreed to waive these fees for up to 400 units of affordable housing through 2022.
But the district has almost reached the cap of 400 with two years left until its own deadline — 380 of those waivers have already been allocated.
This has led the city, which waives its own system development charges for all affordable, deed-restricted housing developments, to ask the park district to remove the 400-unit cap altogether.
“This program has had the exact effect we had hoped for: it’s a catalyst for the development of much needed affordable housing in Bend,” Mayor Sally Russell wrote in a letter to the district in September. “Relief from Parks SDCs, the highest SDC compared to any charged by City of Bend, has served to create a record number of affordable housing starts in the City since inception. Reducing the cost of housing by this amount has incentivized new development and effectively closed the financing gap, significantly increasing the number of Bend residents served by this program.”
Removing the 400-unit cap is an idea that is supported by several organizations, according to public records obtained by The Bulletin. The League of Women voters, the environmental nonprofit 1,000 Friends of Oregon, Habitat for Humanity, NeighborImpact and Louie Pitt, Confederated Tribes of Warm Springs director of governmental affairs, all have written letters in support as of Nov. 18.
But the decision to remove the cap is not a simple one, said Michelle Healy, deputy director of the park district. Earlier this month, the park district board or directors heard a presentation from staff members about how SDCs support the park district. The board will discuss the topic further at a meeting on Tuesday.
“Before we decide to add more waivers, we want to have a thoughtful conversation about the trade offs to the system on the whole,” Healy said.
The park district highly relies on revenue from SDCs to do things like build new parks and complete major repairs and improvements to trails and other infrastructure. For the past 18 years, 50% of all funding for these kinds of capital projects have come from SDC revenue, Healy said.
Nearly a quarter of SDC revenue goes toward buying land for new parks to keep up with Bend’s rapid rate of growth, Healy said.
“Why does a park cost so much? Just like any other developer, we have to pay for all the necessary parts to make that happen,” Healy said. That means things like buying land, or paying for utilities and roads to be built out to the park.
The waivers so far amount to about $2.2 million in revenue the district did not receiv, Healy said — enough to build another park.
Healy also argued that unlike the city, the park district doesn’t have as many sources of revenue to draw from when it comes time to pay for new projects. For example: the city can set up on something called an urban renewal district — which is a taxing tool used to revitalize run-down parts of town — to pay for infrastructure projects, Healy said. The park district can’t.
“We don’t have the number of tools available to us in terms of funding mechanisms, nor do we have the flexibility on how to spend it,” she said.
But proponents of removing the cap argue affordable housing can’t be tackled in full unless every public agency works together.
Lynne McConnell, the city’s affordable housing manager, said the park district fee waiver has already made a big difference in getting affordable projects off the ground. She offered Stillwater Crossing, a 240-unit affordable housing project in south Bend that broke ground this month, as an example.
Of the $2.1 million in SDCs the developer, Wishcamper Development Partners, didn’t have to pay, about $1.35 million of it was park district SDCs.
“Without the park SDCs, Wishcamper would have likely not moved forward … I would say that’s true for almost every development,” McConnell said.
For perspective, an average parks SDC rate for a multi-family unit is $5,644, according to park district presentation.
For Colleen Sinsky, park SDCs could make or break the housing project her non-profit organization, Central Oregon FUSE, hopes to complete.
Sinsky, who is the program manager of FUSE, said the organization’s goal is to create a housing-first model for chronically homeless people with disabilities.
System development charges are one of many barriers that need to be removed in order for affordable projects like to happen, she said.
“Building housing for that very low income group is really difficult to finance, because we aren’t going to generate that in rent,” Sinsky said.
Sinsky said unlike other kinds of development, a few thousand dollars can sink a project like the one she hopes to do. She also disagrees with the concern some board members expressed at a meeting earlier this month, which was that savings from an SDC reduction wouldn’t be passed down to the homeowner or renter.
“It still directly benefits the end user, because the project just wouldn’t take place in the first place (without the waiver),” Sinsky said.
She thinks removing the cap for affordable housing waivers should be considered a high priority for the park district.
“It seems like a no brainer to me,” she said.
(1) comment
new homes should carry the same load as existing homes; the fee waiver is a bad idea that should end
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