PDC unloads affordable housing obligation in North Macadam

The League of Women Voters is calling on the city to stand behind its agreement to build affordable housing in the North Macadam Urban Renewal Area after an preliminary agreement indicates the Portland Development Commission is bailing on 400 promised units.

The agreement releases the PDC from its obligation to invest $4 million into block 33, build 400 affordable housing sites there, and removes any obligation for the site to reserve units at 0-60 percent of median family income – the poorest and most difficult to subsidize population.

The deal is that PDC gives up Block 33 to the Oregon Health and Science University for $3 million – $1 million in transportation charge credits and a maximum of $2 million from the sale of the property. That money can then be redirected to Block 49. The plans for development on Block 49 include 209 affordable housing units, with 40 to 50 dedicated to formerly homeless veterans.

City Commissioner Nick Fish said that Block 33 was no longer viable for multiple reasons, and that his focus is on Block 49, which is already $2 million into plans for developing 150 units for homeless veterans. “We made a commitment to our homeless veterans,” Fish said. “Block 33 is a challenged site and, currently, there is not enough money to do both.”

Here’s what the League had to say:

The North Macadam urban renewal area is 11 years old.  To date not one unit of affordable housing has been developed.  Many of the other projects outlined in the plan and the Central District Development Agreement, however, have been completed or are near-complete including the OHSU tram, streetcar, condo towers, streets and sidewalks, and Elizabeth Caruthers Park.  During the early planning for this district fears were expressed that this area might become an enclave for the wealthy.  Given the amount of public resources that will be devoted to this district we urge you to ensure that fear is not borne out.

In 2006, when the 8th amendment was adopted, PDC believed Block 33 was a viable option for 400 units of affordable housing.  We do not understand why this is no longer the case and encourage you to ask that question of staff involved in negotiating the deal.  Furthermore, the 8th amendment transferred the obligation to develop 400 units of affordable housing from North Macadam Investors to the city.  What are the plans for fulfilling that obligation?

Portland Housing Bureau Director Margaret Van Vliet noted that the Block 33 plan was set out well before the revenue from the Urban Renewal Area was known, and the expensive level of construction on that site didn’t pencil out for affordable housing. Van Vliet said she and the PHB are going to work to find affordable housing apartments elsewhere in the area, and as the North Macadam area develops, more money — dedicated through the 30 percent set-aside in taxes — should become available to put toward affordable housing.

“But it’s not there right now,” Van Vliet said.

Van Vliet said it is not clear on the obligation to replace quid pro quo the 400 units and 0-60 percent housing from Block 33, but that regardless of those figures, she will try to establish affordable housing wherever possible.

“The recent TIF report showed signs of progress in the overall meeting of income targets, however if you look at the TIF report as a whole, the city has failed to meet 0-30 percent income targets in many districts, including North Macadam,” says Julie Massa, Portland Policy Coordinator with Oregon Opportunity Network. “The city had plans to dig deep on TIF funds for North Macadam, but they wouldn’t have reached the lower income targets with Block 33.

“In light of these new developments, we want to make sure there’s a return on public housing investment that benefits all income levels in any projects moving forward.”

The complete letter from the League of Women Voters of Portland follows:


DATE: February 23, 2010

TO: Chair Scott Andrews

PDC Board of Commissioners

FROM:  League of Women Voters of Portland

CC: Commissioner Nick Fish, Margaret Van Vliet, Kate Allen, Steve Gray, Julie Massa, Lisa Abuaf

RE:  Action item:  Agreement of Assignment and Assumption of PDC’s Rights in Block 33 of the South Waterfront Project of the North Macadam Urban Renewal Area to the Oregon Heath Sciences University and the Ninth Amendment to the Central District Development Agreement

The League of Women Voters of Portland has followed the North Macadam Urban Renewal Area development since the inception of the steering committee responsible for the district’s 1999 Framework Plan.  Over the years, we have encouraged PDC to leverage effectively urban renewal dollars with an emphasis on funding amenities that private developers would not undertake, including parks, the greenway, and housing affordable to a broad spectrum of incomes.

The Central District Development Agreement obligated North Macadam Investors to develop 400 units of affordable housing subject to the availability of sufficient PDC financing.  The obligation to develop those units was assumed by the city when the 8th amendment was executed in 2006.  Block 33 was identified as the location for those units at that time.  That obligation will be cancelled in the Ninth Amendment and PDC will give up the air rights in return for $1 million in transportation system development charge credits currently owned by OHSU plus 25 percent of any profits realized by OHSU should it sell the property within seven years, up to a maximum of $2 million.  It is worth noting that PDC paid $3 million for the air rights.

The League is extremely concerned about the future of this district in terms of the affordable housing commitments made in the Central District Development Agreement, the district wide affordable housing targets, and the city’s broader equity goals.  The North Macadam Urban Renewal Area Housing Development Strategy states that of the first 3,000 housing units produced, 788 will be affordable to households earning up to 120 percent of MFI (754 units affordable up to 100 percent of MFI).  The Central District Development Agreement called for a minimum of 200 units developed in Phase 1 and 230 units in Phase 3.  If development of more than 3,000 units occurs additional future development will match the city’s income profile.

The North Macadam urban renewal area is 11 years old.  To date not one unit of affordable housing has been developed.  Many of the other projects outlined in the plan and the Central District Development Agreement, however, have been completed or are near-complete including the OHSU tram, streetcar, condo towers, streets and sidewalks, and Elizabeth Caruthers Park.  During the early planning for this district fears were expressed that this area might become an enclave for the wealthy.  Given the amount of public resources that will be devoted to this district we urge you to ensure that fear is not borne out.

In 2006, when the 8th amendment was adopted, PDC believed Block 33 was a viable option for 400 units of affordable housing.  We do not understand why this is no longer the case and encourage you to ask that question of staff involved in negotiating the deal.  Furthermore, the 8th amendment transferred the obligation to develop 400 units of affordable housing from North Macadam Investors to the city.  What are the plans for fulfilling that obligation?

The League also urges you to ask PDC and housing bureau staff on Wednesday how they plan to meet district wide affordable housing goals and ensure that the significant public investment in South Waterfront benefits Portlanders at all income levels.

Posted by Joanne Zuhl

3 responses to “PDC unloads affordable housing obligation in North Macadam

  1. Pingback: Housing Bureau makes $8.2 million available in affordable housing developments « For those who can’t afford free speech

  2. Pingback: ommunity Gathers to mourn the loss of 400 units of housing. « For those who can’t afford free speech

  3. Pingback: We want our 30% set aside, already! « For those who can’t afford free speech

Comments are closed as of Dec 17 2012 to prepare for migration of content to our new News site.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s