Editors Note: There is more to this story than Urban Growth Boundary Expansions. As you read, you will be shown some serious disparities in our housing options in the City, and policies designed to prevent us from solving this problem. Why move the UGB when we are not doing much to use what we have? Read on to find out more.
In a busy life, catching much of what is happening in the news is hard. Add to that the myriad of media sources, blogs, and social media challenges, and it is almost impossible. Our quest here at the Hillsboro Herald is to bring untold stories forward, and part of that is to shed light on policies, social problems, governance, and decision-makers who shape our world. One of the most influential people in Oregon, especially Hillsboro, which is the economic engine of the State, is Mayor Steve Callaway. His leadership and visions have led Hillsboro through perhaps the most extensive growth period we have ever seen- both in terms of housing expansion and industrial growth. He is well-liked and one of the busiest retired educators in the history of the world. The job does pay about $40,000 a year, but that is not much compensation based on his time. I like Steve- I do not always agree with his positions, but not many people who meet Steve are left with a bad impression.
When I saw he was featured in the Oregonian today (Readers respond: Cities need land supply), I decided to have a read. Steve responded to a September 13th article (Gov. Tina Kotek’s housing council wants to make it easier for cities to expand). In his response, he takes the position that the City of Hillsboro supports the expansion of the Urban Growth Boundary around Hillsboro for several reasons. He also states that infill housing and redevelopment inside the existing Urban Growth Boundary can not address our housing needs.
In the letter he submitted, he states, “The critical connection between land needed for housing and land needed for employment cannot be overstated. ” Citation: https://www.oregonlive.com/opinion/2023/09/readers-respond-cities-need-land-supply.html
The Herald has covered the massive industrial land expansions in the works here in Hillsboro allowed for by Senate Bill 4. Mayor Callaway, Economic Development Director Dan Dias, and others from Hillsboro were pivotal figures who testified & provided information to the Oregon State Legislature Joint Committee earlier this year. They lobbied for rules and provisions to give Hillsboro 1,700 acres of new land for more semi-conductor fabs and companies that support them. You can see the record here on what was said- https://olis.oregonlegislature.gov/liz/2023R1/Committees/JSEMI/2023-02-08-17-00/Agenda.
Mayor Callaway wrote an executive-level letter that asked for action by the Committee to open up Rural lands on the Western and Northern edges of Hillsboro for industrial expansion. In addition, he asked the Committee to deny or limit public input and “Make the Governor’s decision permanent and final with either no appeals or appeals being expedited.”
Here is that letter: Mayor Steve Callaway’s Letter To Oregon Semiconductor Task Force
In my view, this is a growth mentality; not wanting pubic input and denying citizens a process for opposition is not something we do in Oregon- but that seems to be changing. In many ways, Growth is what Steve has stood for and what he is respected for by many. We live in an Intel town and that sort of thinking is more common among newcomers who have lived their entire Hillsboro experience as part of the machine creating the growth and building the factories.
It is not up for debate that Steve and the staff at City Hall have sided with growth- sure, good things are happening but if anything, it is foot to the gas. There seems to be no interest in stopping to smell the roses or even putting the machine in 3rd gear. We have established that Steve and others promoted Industrial growth earlier this year. In this recent letter to the Oregonian, he is making the case to expand the Urban Growth Boundary to build housing for that growth. This process of promoting job growth and housing land is a repeating pattern. As things progress, machinery is grinding that will not stop unless someone or something says something. Do we want to be San Jose? Is that something to aspire toward? In my view, it is not. Will our borders touch Banks in 30 years? One would not be crazy to think it impossible.
Now, back to housing for a moment. In June 2022, the City of Hillsboro passed sweeping new laws to address our housing crisis. Senate Bill 2001 was designed and created to stimulate infill housing. These new laws allow for 2-4 units on single lots inside Hillsboro in residential zones. It also provides for cottage clusters and townhomes. Hillsboro passed the rules, which many thought would stimulate many small-scale infill projects near Downtown Hillsboro, Orenco, and the older areas of town where large lots are prevalent. However, that has not been the case for a number of reasons. One of them is purely financial.
Mayor Callaway and the City Council and Planning Commission received a lot of testimony leading up to the passing of our Middle Housing laws. The most crucial testimony, in my view, was that of expert consulting firm Eco-NW. After aiding city planners in writing hundreds of pages of new code, Eco-NW experts warned policymakers that smaller housing options needed adjustments in Systems Development Fees, permitting costs, and other considerations to be successful. Here is what they said:
The City must consider waiving or deferring SDCs for certain middle housing, and must
consider variable SDCs for smaller housing along with service providers.
Even more important is that smaller homes are being charged the same fees as bigger homes are. The Eco-NW experts wrote:
This small cottage was planned to be built with several others on a lot just a block off TV Highway, South of the new food Carts- close to the Hospital, light rail, and Pacific University. These cute cottages can be built affordably and would have sat along a common garden plaza. While they are only 450 square feet, they offer a complete home and a community on land that is currently vacant with grass growing on it. These units could have provided lower-income to moderate rents or sold on a small lot in the $250K range.
This was a project I was working on personally in my professional life as a broker and housing consultant. The first thing we did was go and get the building permit fee estimates, which included water and sewer, schools and stormwater, and traffic impact and parks fees. Now, this little house might support one or two occupants. But would you believe that the cost of building permits and development fees came in just a few pennies under $50,000 dollars! That is over $100 per square foot for PERMITS! Yikes. Something is wrong when 20% -25% of the budget is permitting fees. But before I went any further, I wanted to see how much another home built here in Hillsboro costs for permits…a much bigger house.
Here is a 9 Bedroom 8 Bathroom home near Orenco. It is over 4,000 square feet- about 9 of the above cottages. NINE of them. This is a beautiful home and it is providing important housing for locals who can not afford their own home. Bedrooms rent for $1,000 a month plus- this is no secret as many Hillsborites live this way in this economy. So I am not against this, nor any bigger custom home that people with money and success can afford! This is one of the rewards of hard work!
So, how much are building permits and development fees for this home? Would you believe it if I told you $50,000? Yes- the same as the little home. This big home was only $12.50 per square foot for permits. 88% less PSF than the cottage.
This is why we have NO INFILL. None of us in the business can make this work- it will never work. To date, I do not believe any infill projects have made it to the finish line.
Look at these comparisons:
450 SF Cottage 4,000 SF House
1 to 2 occupants 9 to 15 occupants
0-1 Cars Likley 3-9 Cars Likley
Light Footprint On Sewer Systems – 1 Bath Heavy Use Of Sewers – 8 Baths
Small Impact On Storm Water HEAVY impact on Storm Water
Schools – 0-1 Student 0-10 plus Students possible
Parks- little to no impact Heavy Impact
Transportation – light impact Heavy Impact
Carbon- Climate Impact – LOW ???????
This is one example. Now, look at this through the equity lens. Does this imbalance in permitting fees seem fair? What this is saying expressly by Hillsboro’s policies is this – if you can not afford much but a small home- you will pay 88% more in permitting fees in order to us to allow you to live there. To those wealthier folks? You get a massive break- and do not have to pay your way- you get to Pass Go, and oh, by the way, here is a financial break on the way.
Am I saying to raise permit fees on bigger homes? NO!!!
I am saying for Mayor Callaway and the City Council to listen to ECO-NW and take immediate action to correct this inequitable injustice to our people of lesser means, and those who may want to build infill homes to rent for retirement income and to help our community be more vibrant in existing areas where new smaller homes can be a blessing in so many ways!
What have I done? I took this case to City Council twice in the past year, told them this story, and pleaded and begged them to help- Mayor Callaway was there. They heard me- they just are not listening. Either because they do not care or do not understand, or it is not a priority- I know they care. So what is it then?
Not seeing any action, I touched base in writing in May of this year with the following question:
QUESTION: 5-31-2023 – Hillsboro Herald- Dirk Knudsen; Editor: May 31st, 2023: Question to City of Hillsboro: Asked as a local builder-developer (yes, I have a job – the paper is all volunteer work) advocating for affordable housing. This question was sent to the City Recorder, Colin Cooper, Planning Director, and Chris Barry, Development Services Manager.
Is there any movement at staff or council to consider the fees (SDC, Building Permits, Utilities) for building Middle Housing? Cottages and the like still cost the same as large custom homes- Eco NW had advised the City to scale permit fees to size and reduce SDCs for MH Uses. I really want to pull off a cottage cluster of small units- 400 SF Each – in a cottage cluster but the costs are in the $50K range. I heard staff was considering this. Is there anything in the works? What is the timing on this? We really need as a development community these important economic equity considerations. Your thoughts?
The City is planning on doing an analysis of all development fees and system development charges as part of a broader effort to understand and support housing that is affordable in cost to the community. This work, the SDCs and Development Fee Cost of Service Analysis, are an upcoming work plan item for the City and something that will also be further evaluated and incorporated as the City gets into the Housing Production Strategy work. The specific timing of this work is not yet known.
No timeline. There is no urgency- no real plan. That, folks, is not acceptable in any way. The City must immediately listen to the Eco-NW recommendations and correct this inequity. They must listen to and trust these very respected experts.
In closing, let me add that Eco-NW also provided an economic analysis of the costs and benefits of building the NEW stadium for the Hillsboro Hops. These same decision-makers adopted every recommendation that the consultants made and are using those recommendations as facts as they push through the decision to move ahead. A decision that will commit tens of millions of dollars in taxpayer dollars to make it happen- many times more than reducing or waiving permitting fees for the infill of small homes across our fine City.
Where is the equity and fairness? Nowhere right now on this housing issue!
Mayor Callaway is one of 7 leading decision-makers in Hillsboro, Oregon. But his words and work lead on almost every front. His opinion piece on housing is not wrong, but his lack of action and leadership on infill housing and equitable permit fees is. Steve, we need you, good Sir. Think this through and make some moves for those of us who can not afford the big new homes. See this unfairness for what it is. Correct this blatant inequitable policy and engage with the matter in a decisive and action-oriented way you are so well known for.
Listen to the consultants and give their sage advice on housing the same energy and credence that you do baseball.