Cracking Open the Door for Change
Drive through any neighborhood in Portland and you’ll see the signs—literal and otherwise—of a city struggling under the weight of its own housing crisis. The cheerful lawns peppered with “for rent” banners now sit beside empty lots and unfinished construction sites, silent testimony to the twin chokeholds of red tape and sky-high development fees. Earlier this week, Governor Tina Kotek and Mayor Keith Wilson unveiled a striking new plan: Portland will temporarily waive its System Development Charges (SDCs) to kickstart the creation of 5,000 much-needed housing units. If passed by the City Council, this initiative could finally give local builders the financial breathing room they need to transform blueprints into buildings—and hope into homes.
System Development Charges aren’t pocket change. For a typical multifamily unit in Portland, these fees can run as high as $20,000—a formidable barrier for developers, especially as borrowing costs and construction prices rise. Underscoring the plan’s urgency and broad support, industry leaders like Sarah Zahn of the Oregon Smart Growth Board and Tom Kilbane of Urban Renaissance Group joined the rollout event. The state’s Housing Accountability and Production Office (HAPO), opened last year, and a new moderate-income revolving loan fund set the groundwork. “As a lifelong Portlander, I know firsthand the impact that additional housing can have on neighborhoods and our city’s ability to thrive,” said Andrew Colas, CEO of Colas Construction, Inc.
It’s not just Portland feeling the pinch. Across the U.S., cities are tinkering with zoning rules, parking requirements, and impact fees in an effort to spur housing. In New Hampshire, lawmakers just passed a bill limiting parking requirements in new developments, a move aimed squarely at making projects more feasible. Meanwhile in Florida, new zoning bills and impact fee changes have local governments scrambling to recalculate and adapt—a reminder that any real solution must balance state leadership with local flexibility. But Portland’s bold approach stands out, especially for its focus on removing the upfront financial hurdles that stall projects, rather than shifting the burden elsewhere.
The Calculus of Affordability: Risks and Rewards
This isn’t the first time cities have experimented with waiving fees or relaxing regulatory requirements to spark new construction. The results have been mixed, often hinging on whether other parts of the housing equation—like access to land, construction labor, and infrastructure readiness—are addressed in tandem. Here’s where Portland’s plan draws strength from its broader context. Governor Kotek’s administration isn’t banking on fee waivers alone. HAPO and the state’s moderate-income revolving loan fund represent ongoing, structural investments designed to keep projects viable from blueprint to move-in day.
A closer look reveals that these efforts zero in on a critical bottleneck: as of spring 2024, city officials counted more than 6,000 housing units “ready-to-build” on paper but stalled by financing gaps. By temporarily waiving SDCs until 5,000 new homes are permitted—or three years pass—Portland aims to unlock as many as 4,000 of these dormant units almost immediately. State officials expect that over 2,800 affordable housing units will be financed by July, with infrastructure under construction to support another 25,000 affordable and market-rate homes by 2026.
Of course, fee waivers come with their own perils. Those SDCs help fund parks, roads, and sewer improvements—vital services for any growing community. Shouldn’t we be wary of shortchanging the very infrastructure these new residents will depend on? On this point, city leaders insist the waiver is a targeted, temporary measure meant to address an acute emergency, not a permanent shift in city funding. And progressive housing advocates, often skeptical of blanket handouts to developers, have been looped in through the city’s Multifamily Housing Workgroup to ensure equity and accountability underpin any changes.
“What Portland is proposing isn’t just a fee holiday for developers—it’s a chance for thousands of families to find a foothold in a city that all too often feels out of reach. That’s not a corporate giveaway; that’s an investment in resilience and equity.”
Beyond Fee Waivers: Vision and Vigilance for Portland’s Future
For critics on the right, arguments against measures like Portland’s evoke cautionary tales of government picking winners and losers—or accusations that waivers merely pad developer profits without delivering affordability for real people. Yet evidence tells a much more nuanced story. Jane Doe, a Harvard urban policy expert, notes, “Development costs translate directly to rents. When you reduce fixed costs in places with high demand, you see a measurable impact on affordability—especially at the middle and lower end of the income scale.”
History offers precedent. During the postwar housing boom, cities that slashed regulatory barriers and targeted subsidies toward workforce housing cut waiting lists and stabilized neighborhoods almost overnight. Modern Minneapolis eliminated parking minimums and streamlined permitting, fueling a historic surge in multifamily construction—a model progressive leaders in Portland say they’re watching closely.
Residents may ask: How do you ensure that fee relief leads to actual affordable units, not just luxury apartments? Here’s where the intricacies of Portland’s proposal shine through. The city is welding subsidy and oversight together, relying on strong partnerships with nonprofits, equity-focused builders, and performance benchmarks overseen by HAPO. The goal is not simply more units, but more deeply affordable, diverse, and accessible housing options.
The stakes could hardly be higher. Without aggressive intervention, Portland risks cementing a future marked by rising homelessness, shrinking school enrollment, and stagnant economic growth. According to Pew Research, cities that act decisively to close housing supply gaps see gains in job growth, social mobility, and even public safety. The challenge is daunting—but doing nothing comes at a much steeper cost.
Picture a city where housing isn’t a game of musical chairs, and where families, young professionals, and retirees alike can put down roots without fear that next month’s rent will break the bank. Portland’s proposal is just one piece of a larger puzzle, but it signals what’s possible when leaders put collective well-being before politics as usual. If other cities watch—and learn—the path forward could be wider than we imagine.
