Editors Note: I am sharing this letter with our readers in a public forum as my testimony scheduled for yesterday in Salem regarding SB 1537, the Governor’s Housing package, was somehow not allowed due to “Technical Difficulties. ” So I am providing it here today and have emailed it to the Governor’s Staff. I was hoping you could share this: think about your housing needs and those of the people around you, and weigh in as to how you feel about the current state of affairs here in Hillsboro. Today – Saturday, 2-10-24 is the last chance to send in testimony – you can do so right here- https://olis.oregonlegislature.gov/liz/2024R1/Testimony/SHDEV
To: Governor Tina Kotek and Staff
Senate Committee on Housing and Development; Senator Kayse Jama, Senator Dick Anderson, Senator Tim Knopp, Senator Deb Patterson, Senator Sollman
From: Dirk Knudsen, Hillsboro, Oregon
RE: Proposed Senate Bill 1537 – Governor Kotek’s Housing Package
Hello, Governor Kotek and Senators;
I am writing today (2-9-2024) because I had signed up to testify online at the 2-8-2024 Hearing for SB 1537, I got confirmation that I was registered on 2-5-24 and would be sent instructions on how to sign in, but nothing was sent. As a result, I was excluded from the hearing and not allowed to present my testimony. Here it is.
My name is Dirk Knudsen, and I have lived in Hillsboro, Oregon, for five decades. For 43 years, I have been in real estate, housing, and land use consulting, providing housing for all people. I have worked on community and state-wide land use issues for that entire time, and I am currently an active member of the Build Small Coalition here in Oregon. My testimony is based on real-world experiences and thousands of successful housing efforts.
The Governor’s Housing package leaves much to be desired. But I am generally in support of it. It will provide many benefits to those of us in the housing industry and even more to those in need who can have a home- for many, their first home. The goals are so important. So I am with you all. Having said that, please reconsider the following:
- Senate Bill 2001 (Middle Housing) was a massive step toward providing meaningful housing inside our existing Urban Growth Boundaries. The promise of those additional units has been realized in many Oregon cities, helping revitalize neighborhoods and adding housing units in existing transit, shopping, parks, and school areas. However, the State of Oregon did not provide any teeth or serious monitoring on how cities implement Middle Housing. As a result, cities with a conservative approach, like Hillsboro (Oregon), one of the most housing-challenged in the State, have little to no units of middle housing built since passage of the bill.
- Hillsboro is in the midst of adding the biggest housing project in Oregon history to its Urban Growth Boundaries. South Hillsboro will have 8,000 units when completed and upwards of 30,000 people. These homes are not affordable and average in the $700,000 range per unit. These are certainly not homes that the majority of our current citizens can buy.
- Hillsboro is also the planned location of almost all future Tech and Semiconductor Jobs as per Senate Bill 4 (The CHIPS ACT), with the potential for over 1,700 acres to be added to the UGB for industry in our town. Governor Kotek, you dictated that.
- Hillsboro is walking into the worst housing crisis in the History of Oregon if these jobs come to our town and the City does not improve upon its housing policies.
- The City of Hillsboro just approved its 2024 Housing Needs analysis and is fighting with the Department of Land Use Conservation and Development and METRO over the growth rate to project future housing. The push to grow our Urban Growth Boundary is on, and developers and land owners are all lined up to hit the UGB expansion jackpot, where land will be brought into the growth boundary and sold at record prices, assuring more housing out of reach of the populace.
- HILLSBORO HAS INEQUITABLE POLICIES ON PERMITS COSTS- THIS POINT YOU MUST READ: Despite clear language and analysis from their consultant Eco-NW Consulting, Hillsboro will not adjust permit fees for Middle Housing or even for regular housing.
- Small homes are charged the same SDCs as massive homes.
- Important Middle Housing Options like Cottages have permitting costs as high as $100 per square foot!!!
- Despite being presented with written documents, oral testimony, and case studies, the City Of Hillsboro City Council. City Manager and Planning Staff refuse to take any action on this matter.
- As a result, the City of Hillsboro, one of the biggest in the State and fastest growing, has NO middle Housing units completed. That is proof of the level of this problem.
CASE STUDY:
We have land in Hillsboro, and we want to use middle housing to place four cottages. One was for my Mother. Her cottage would have been 400 square feet facing a common garden like this one. The others were going to be for other Seniors and priced at a low rent to help them. This was her dream and would have changed the quality of her life and the lives of others.
I went to the City of Hillsboro building department, where a set of fee and permit estimates were given to build these units. A staggering permitting cost of $49,500 was estimated per unit, totaling $ 123 per square foot! Much of that was Systems Development Charges!
Compare and Contrast:
This is a home that a client of mine built near the cottage site we have. 1 Block to the MAX light rail and a 5-minute walk to INTEL Ronler Acres. This home is:
- 9 Bedrooms and 10 bathrooms
- It has two full kitchens and multiple living areas
- Is 4,200 SF apx.
- How much were the building permits and SDCs? $50,000 – or $12 per square foot!
- It is an important home as it does provide living for up to 9 people.
Costs are similar, but Impacts are vastly different- The big home has 10 or 11 Toilets on the same type of sewer line with the same fees that my Mom’s cottage would have had just one using. The big house generates dozens of daily trips on our roads- Mom would have generated none. 9 People can use parks, schools, and city services in the big home. Mom, just one. The impacts of a huge house dwarf the impacts of a small cottage, and as a result, the upfront SDC fees must be prorated or scaled on total square footage or occupancy.
Affordable Tiny Cottage – $112 PSF in Fees VS Huge Luxury Home – $12 PSF in Fees
Governor and Senators, how can you allow this? How can you make a housing policy with hundreds of millions in taxpayers’ money and allow this to continue in any City in Oregon? To do so would equate to a failed policy, expanded UGBs over all else, no important infill and middle housing, and a fleecing of the taxpayer’s money.
Therefore, please add policies and rules that exclude cities with punitive housing policies like those I have stated above from Participating in the robust benefits and the money you are providing through Senate Bill 1537. PLEASE EXCLUDE MY HOMETOWN OF HILLSBORO from participating in SB 1537 until they eliminate these horrible housing policies that punish the marginalized, those less fortunate, and those of us trying to help their Mothers.
Despite my appearance at City Council 3 times to state this matter and ask for changes, multiple emails, and exchanges with the Planning Commission and Planning Staff, there was no action or movement. My mother will never get her dream cottage- she passed away last Fall.
Please LISTEN to my testimony and consider your Moms and all the people of our community and others where antiquated codes and policies are punishing them and treating them as something less than those who are more fortunate. WE MUST ELIMINATE INEQUITY WHEREVER WE FIND IT. You have been made aware of it in my town, and now, should you fail to act, you are promoting it and supporting it. That is not who you are and not who we are as a State!
I thank you for your time and ask for your support!
Very truly yours,
Dirk T Knudsen
Hillsboro, Oregon
Thank you, Dirk, for taking a strong and well-informed position in this matter. I will be keeping a much closer eye on the bill as a result of your letter.
Written testimony allowed through today! https://olis.oregonlegislature.gov/liz/2024R1/Testimony/SHDEV
Thank you Dirk for speaking up this is insane and Oregon leadership seems to be getting more insane I would like to believe it’s not just the political bent but more and more the insanity keeps coming into our communities at some point the chaos will resemble that of larger cities ex. NY, LA, Chicago etc. stop the stupid decision making! I have been a resident of Oregon my whole life. But thinking of moving if these keeps up!
Testify online if you can- today is the deadline! https://olis.oregonlegislature.gov/liz/2024R1/Testimony/SHDEV
Were millennials who both work and we’ve been priced out of purchasing a home in Beaverton, Hillsboro, Portland, Tigard, etc. pretty much anywhere that would be near our jobs. We’re also getting close to being priced out with rent.
What are we to do? Why does the government allow this?
James and Sarah-
First off, you and other millenials must rise up and make this change. I am here to help you- I need help. These articles cost me personally and I am gaslit and attacked by people in power who I consider friends. You need to write the governor too! This is the link- Today is th deadline! https://olis.oregonlegislature.gov/liz/2024R1/Testimony/SHDEV If you are interested in helping create equitable housing action let me know. We are going to get to work on thinsg this year! https://olis.oregonlegislature.gov/liz/2024R1/Testimony/SHDEV
I appreciate your letter and your clear evidence-based identification of the problems inherent in executing middle housing. I am a small potatoes real estate developer/landlord and three times now I have attempted to add middle housing units to my existing properties and three times now I have failed. The reasons are contradictory rules regarding the zoning in some cities, but mainly the high cost of building small units as you correctly identified in your letter. It is cost prohibitive! It frustrates me to no end. I used to be a social worker. I understand there are huge housing needs in this state. The good intentions by the powers that be are certainly there, but over here on the other side of the equation as “boots on the ground “I agree with you completely! I cannot seem to get any middle housing, built or done because of the incredible barriers particularly cost barriers. I’m so glad to have read your letter today. Thank you.
There are a few of us out here. Where was your issue?? Portland or Hillsboro or??
We are the Zucconi’s, John & Merrie. Retirees from AK After renting 3 years here for n Eigene and seeing our rent go up so much that it would soon cost 25,000. per year . We bought a mobile home for cash w/rent @750/mth. Now iit’s1000. No rent caps for seniors in OR?! At least there are 2 of us so we just get by. Many singles here have had to sell & mobile homes sell for well under 100000! Where do we go? AK has rent & tax caps for seniors. Why can’t we do something like that here. Seniors have worked hard, pd our taxes & are now “the poor. So sad & scarey as hell. Shame on you all!
They want the poor homeless especially if you’re a senior we’re too old to be living
I’m not a developer or a realtor, but I have lived in western Washington County my entire life (nearly 51 years). Hillsboro, then Cornelius, then Aloha, then back to Hillsboro for the last 37 years. I was a young child in 1976 when my parents bought a new home, under construction, in the Willow Creek area of Aloha, off 194th and Baseline. Price: $41,500. It was the first home under construction in the subdivision. A developer platted the streets, installed the utilities, and then sold the lots to individual local builders. It was not a planned-unit development, there was no HOA. Small, local independent builders bought the lots, then they built and sold homes appropriate to the market. It was better that way. There was more competition, better build quality, and more reasonable prices. Counties and cities enforced basic ordinances with regard to sanitation and upkeep.
My perception is that, when the big national developers came in and started building “master planned communities” with HOAs, private parks and recreation facilities, and controlled the type and size of house built on each lot, prices went up, quality went down, and, in general, housing became less affordable. Not only do folks stuck buying an overpriced house, they have HOA fees on top of their mortgage!
I submitted testimony however could not find 1537 as an option so had to choose another bill
Disbanding metro would be a good start. It’s just a bunch of greedy, power hungry Portland bureaucrats spreading their dictatorship out of Portland into surrounding counties.
Thank you so much for this Dirk.
My wife and I have been moving further and further away from the metro area over the past 10 years. Rent continues to rise and finding middle housing that isn’t a rundown safety hazard/money pit for a family of 4 is impossible. I have been getting good raises and promotions year over year but rent and living expenses continue to rise faster than my wife and I can counter the rising cost. We moved out past Hillsboro into forest grove a few years ago and were almost able to buy a home there when COVID hit and we both lost our jobs. We have sense found new jobs and are making more than we were before but interest rates and rising housing cost along with a complete lack of middle housing being built has made it impossible to buy a home yet again. We are likely going to be priced out of our rent in the next couple of years as well and have to move even further out.
Please let me know other ways I can get our story heard. I appear to have come across this hours too late as the SB 1537 online submissions appear to be closed.
I 100% agree with your comments and the other part of the equation is the people.thatvote these individuals into office…, if people don’t wake up there will be nothing left to fight for and homeless will be a lot more peoples address
Well written. Thankyou.
I have run into a similar problem in the city of Salem. I appreciate your detailed analysis and also submitted testimony.
Thank you Knud for your informative testimony. I agree with you. The example you note seems grocely unfair and I feel sorry for you and your Mom.
From past experience I do believe that State Goverment and the City of Hillsboro have a “run it down their throats attitude”.
Unbridled growth with no further conditions is no way to run a State let alone a City. As a matter of fact I have given up to try to make government more responsive to its citizens needs. I have resigned myself to the fact that I just live here. Not that I don’t care. In fact I do. But the powers that be are entrenched and I do not want my remaining time here, fighting it.
The UGB for instance. If Metro and City do not regulate it more with zoning and affordable housing designations, then it becomes a free for all for developers. Who swoop in; buy the newly included land and price the hell out of it. $700,000 homes in South Hillsboro does not do anything to solve the affordable housing crisis. To developers it is a free for all just trying to get their hands on that scarce land. Farmers who have to part with the land never imagined they would get so much money for their farmland.
So I a.m sorry to say; Metro should keep control of the newly included land in UGB. It should then zone it; and designate the land (e.g. multi family housing etc. ) and control what happens to the land (yes more government). It would make it obviously less attractive for developers – but who gives a hoot.
I was hesitant of your viewpoints when I saw the article’s title, read it any, and found myself to be in complete agreement with you. The entire interior of the UGB needs a moratorium on the building of houses above the region’s median price.
Speaking civilly as one must to have hope of helping public policy along for the public good, is a frustrating and demeaning process when “leaders” are in fact dictators. We see diminishing good in return for civility and fact based reasoning.
The inability of Dirk to testify in the originally scheduled format – incompetence or malice?
Say you’re a tiny home developer without saying you’re a tiny home developer. (Maybe if I call them cottages nobody will notice) I imagine you probably have a few things to say about the ridiculous ADU laws as well?
It depends …and I am not a tiny home developer. They are not allowed in Hillsboro at all, but should be. I am a housing advocate and because we can’t house our own people I am all for people doing what they must do to survive. I have seen no less than 10 converted garages this past year with people living in them…pretty nicely too. The fact we as a city don’t have flexibility stems from a Good Ole Boy and Girl Planning Commission stacked with privileged retired lawyers and folks with no housing background. Most of them very close to the Mayor who selects who he wants. I have been turned down on 4 occasions despite proving myself on the PZHB for 3 years. What is your opinion? You seem to have one but aren’t sharing it…feel free to!
SDC’s should not be based on the square footage of the lot or the building, but rather the fixture count. In Dirk’s example, the 2-kitchen 10-bath home would place a much greater demand on the city’s water and sewer systems than a 1-kitchen 1-bath cottage. In addition, the number of downspouts and storm drains on the building and its lot should be factored into the SDC since they will be connected to the stormwater sewer system.
It is also time to limit the application of SDCs to development, expansion, and upgrade of public utilities, such as water, sanitary sewer, and stormwater sewer. Private utilities (PGE, NW Natural, Ziply, Comcast) should set their own connection fees for the respective systems they maintain.
Based on what I’ve seen with the development of South Hillsboro, SDCs should not include funds to develop new parks unless they are accessible to all Hillsboro residents. The new city parks in S. Hillsboro do not have any on-site or adjacent on-street parking, limiting their use to residents living within walking distance. In essence, the city parks in S. Hillsboro function like private parks for use by the residents of the adjacent HOAs. Why should new construction within an existing neighborhood (which likely already has parks) be charged for SDCs for new parks when there is likely no land to build a new park within that neighborhood? SDCs for new construction within existing neighborhoods should go entirely to upgrading the water and sewer lines within that neighborhood to handle the additional demand, if such upgrades haven’t already been done. And, if the water and sewer lines are already up to modern standard, the only fee that should be charged is a connection fee.
Mr. Knudsen,
I live in Roseburg Oregon and read your article this morning. People like you ( who look at the big picture) should be the ones we put in elected offices that plan and run our beautiful state.
Bravo to you sir!
I hope they listen as well as learn from your insights.
God bless you and your efforts!
My condolences in respect to the loss of your mother.
Sincerely,
Lisa Deland
Mr. Knudsen,
I live in Roseburg Oregon and read your article this morning. People like you ( who look at the big picture) should be the ones we put in elected offices that plan and run our beautiful state.
Bravo to you sir!
I hope they listen as well as learn from your insights.
God bless you and your efforts!
My condolences in respect to the loss of your mother.
Why is it that there are so many homeless people on the streets in Oregon? Our legislature and the Governor of our state spent millions of dollars to find out why. Their “independent” professional consultant studies indicated that the cost of rents were too high for the poor man to afford to pay. Their answer was to pass legislation limiting the rents a landlord could charge and increased the cost and burdens of being a landlord so that rent would become more affordable. Because of their actions many people sold their rental properties which caused the supply of rental housing to decrease. If you know anything about economics you know that supply and demand fundamentals cause the price to be what it is. Our government did just the opposite what a reasonable person would do. Instead of increasing the supply through incentives for future development, they expected the landlords to be willing to take on these new burdens (regulations) and be willing to charge below market rates due to limiting future rent increases. Not one mention was there that the cost of building a housing unit dictates how many will be built. Investments are financed and if there isn’t an adequate return, investors look elsewhere to invest. The biggest change in the last 30 years has been the implementation of huge development charges that Mr. Dirk refers to. When you add $50,000 more to a building costs for system development charges not to mention the additional cost of regulations and requirements laid out in the permit to be issued, the total investment needs to be financed resulting in a monthly mortgage. If you are a wise investor you need to raise the rent to cover all of your costs plus a profit or why do it.
You do not need to spend millions on an independent study when you do not want to look for real answers that will work, but rather let’s keep on beating up on the “bad guy” be it an oil man, a banker, a landlord, a businessman, a white man, or a rich man. Divide and conquer politics are popular, but do little to fix our problems. If you want to lower rents then you need to lower the investment cost. Pretty simple I know.
Dirk, I’ve been in the land planning/ engineering biz in Washington County about as long as you’ve been selling RE here, started in 1976, when the median house price was in the mid- 30’s, and the application fee into Washington County Planning office was $100. Now median house price in Hillsboro in the mid- $500’s, and application fee to Washington County Planning office, for almost any type of residential development is $15k – $20k. In Hillsboro, on top of the SDC fees you mentioned, so yeah, the state and the City do “allow” a cottage cluster type housing development on a legal lot of record. However, along with the same SDC’s as full size house ( currently in the 45k to 55k range), City staff requires “public” utility systems to each cottage. A “public” sewer line and a “public” storm line to each cottage, each require a minimum of a 15 foot “public” easement, ( if run parallel with each other, than a 20′ foot wide “public” easement. So yes, with the cost of “public” utility, versus “private”, and the width of the required “public: easements, simply no way develop a cottage cluster affordable type development, the City has the “cluster” part of the development figured out, but it certainly doesn’t pertain to a affordable housing option:-)
Your knowledge and your voice are needed on these matters, John. Would you conider being a part of a housing advisory group? Because the City will not form one, I am planning to. You would be a most welcome addition to advise and share your incredible wealth of knowledge.
Dirk, yeah, I could join your group if I thought it was going to make a difference. There needs to be so many changes to the City of Hillsboro/ Washington County governmental process, almost don’t know where to start. First, need to wean the City’s off SDC’s, new development shouldn’t have to pay for all school upgrades, road upgrades, etc. City government, school boards, fire marshal’s should all have to go to the voters for bond issues for those items, rather than the blank checks they get from the SDC fees. In my mind, the new developments pay for themselves, after development occurs. I’m thinking of a small vacant parcel on NW Garibaldi ( in Hillsboro ), I worked on a few years ago, it was a vacant 1.5 acre site next to the RR tracks, neighbors were complaining of homeless issues, etc., the property taxes generated every year were in the $3k to $4k range for the total site, now a couple years later, 15 single family homes constructed and lived in, property taxes generated are now in the 60k to 75k range. The County, nor the City didn’t spend a single dime to get this extra income, isn’t that additional property tax increase enough for the City? Oh yeah, the County/ City got another $750,000 ( M/L) from SDC fees from those 15 houses at time of building permits. One more thing, I also do work in smaller communities ( like Hillsboro used to be ), City’s like Scappoose or Cornelius, or even Forest Grove, the city hall’s are small, and even somewhat quaint, like Hillsboro used to be when it was on 2nd Avenue, and every desk has a person sitting at it, doing their work. Now when I go to the City of Hillsboro, as I did a few days ago, ( we insisted on a face to face, they wanted virtual ), had a meeting on a 4th floor conference, walked past rows and rows of office cubicles, void of any workers, to a beautiful 4th floor corner conference room, probably one of the nicest offices I’ve been in, anywhere in Hillsboro, yep, that’s what our SDC’s are paying for. I’m happy that Hillsboro is doing well financially, but I hate to see all that wealth and luxury, on the backs of the residents of Hillsboro.