More than ten thousand housing projects to date have been given waivers to that requirement—formally called "waivers of remonstrance"—that push off the burden onto the people who eventually own the home. But it turns out the city never pursues those payments. The improvements go unfunded.
Now Commissioner Steve Novick is pushing a new approach. Next week, he'll propose a fee for developers of homes on "unimproved" or "under improved" streets—like the 3 percent of city streets that are dirt or gravel, or the 15 percent of Portland roads that lack curbs or sidewalks. The damage, initially: $600 per foot of road frontage on the property. That could change from year to year, or based on where a home is located.
The city's calling it a Local Transportation Infrastructure Charge (LTIC), and it's the latest cash-seeking strategy we've seen from Novick, who oversees a transportation system that's badly underfunded.
The new charge isn't completely out of the blue, though it's the first I can remember hearing of it. City documents show PBOT's been working with a stakeholder group (membership unclear) and the consulting firm EcoNorthwest since at least last summer on the proposal. PBOT says it's actually been in the works for more than a year.
The bureau argues the LTIC solves a basic issue of fairness. While some developers abide by city requirements that they improve the roads in front of their housing projects, others obtain a waiver "that excuses them from making any improvements, passing the cost onto future homeowners," according to the city.
It's an enormous waste of potential money, since the city says it never collects on those costs. Officials are supposed to corral homeowners into Local Improvement Districts (LIDs) where residents pool money to improve roads. But PBOT's proposal notes "the City has pursued very few LIDs for local streets in recent years. Thus, the waivers of remonstrance received by developers (roughly 12,500 issued to date) are for LIDs that have never materialized."
The new charge Novick's proposing would change that—at least for a subset of new development. It would only apply to houses in single-family zones, where the street lacks a sidewalk, curb, or pavement. Developers would be required to pay the fee while applying for a building permit.
The charge wouldn't be mandatory—developers could still choose to make road upgrades on their own. But that's clearly not the city's favorite option. As a February report from EcoNorthwest notes: "Building small, disconnected frontage improvements is costly and time-consuming, including a lengthy design and permitting process... The LTIC is intended to clarify and expedite this process."
The same report insists that the new charge would have no effect on housing affordability or supply.
If City Council agrees to enact the fee—which would likely be over the objections of developers—it'd go into effect in May at the earliest.
So how much can the city count on raking in? No idea.
"The bureau cannot at this time accurately assess the number of developments which will take advantage of this option instead of building the transportation improvements," an impact statement filed with the ordinance says.
As I noted above, the LTIC's just the latest idea we've heard for getting PBOT new money. After several failed attempts to pass a "street fee" to pay for road repairs and maintenance in 2014, Novick succeeded earlier this year in getting a 10-cent, four-year gas tax onto the May 17 ballot. It could be good for $16 million a year—a fraction of the city's needs, but something. Novick's also promised to look into taxing diesel users all over the state.
Calls to PBOT and Novick weren't immediately returned.
