Beginning Jan. 3, some parking mandates in Oregon housing construction were no more.
The state’s land use commission approved the new rules last July in hopes of accomplishing numerous impacts, namely enabling more housing construction.
Earlier this year, newly sworn-in Gov. Tina Kotek issued an executive order outlining a goal to construct 36,000 new homes per year in Oregon — up from the state’s current estimated 20,000 new homes built annually, according to the Oregon Housing Needs Analysis. The Oregon Housing Needs Analysis, or OHNA, created by the Oregon Legislature in 2019, finds a current shortage of approximately 140,000 homes across the state.
The state’s land use commission and Oregon Housing and Community services, tasked by the Legislature with preparing recommendations in response to the OHNA, put forward numerous parking reform tweaks in an effort to help Oregon close the gap.
The rollbacks
The new rules stipulate all properties within a half mile of frequent transit service, or three-quarters of a mile of a rail station, no longer have parking requirements.
The new regulations also remove parking mandates for certain housing types in metro areas, regardless of distance from transit service, including regulated affordable housing, single-room occupancy housing, domestic violence shelters, homeless shelters and housing units smaller than 750 square feet.
The rules apply to the 48 Oregon cities in Oregon’s eight metropolitan areas and some additional counties meeting population requirements, such as Clackamas, Marion and Washington counties.
Some rules covering parking near transit took effect Dec. 31, 2022. Others, such as a stipulation for electric vehicle charging, took effect March 31, while still other rules that cover parking regulation improvement, like encouraging redevelopment of underused parking, take effect June 30.
The rollbacks are in response to 2019 Oregon House Bills 2001 and 2003, both of which called for Oregon to increase missing middle housing construction and reduce impediments to increasing housing, according to Anyeley Hallovà, chair of the state Land Conservation and Development Commission.
Some experts say the parking rollbacks will encourage new development, including additional affordable housing.
Inclusionary Housing
Parking rollbacks come at a time when housing affordability is a top priority in Portland, as rents skyrocketed throughout the pandemic. The real estate broker giant Redfin found the average asking rent in Portland increased by 29% in 2021 alone.
One of the most direct attempts to improve affordability was the city’s 2017 Inclusionary Housing zoning, which has received mixed reviews about its effects.
The zoning regulation requires 10% or 15% of units in new developments of 20 or more units to be affordable to households earning at or below 60% or 80% the area median family income, which is $78,476 in Portland according to the U.S. Census Bureau. The percentage of required affordable units and the degree to which they’re affordable depends on which permitting a developer chooses to pursue.
There are a few incentives for developers to meet these requirements. One incentive is a 10-year property tax break, in some cases for the entire building, and in others for just the below market rate units. Another incentive is waiving sewer and parks fees if the developers provide housing affordable for renters earning at or below 60% of the median family income.
In one year of the zoning taking effect, according to a study by Portland State University, 17 projects included Inclusionary Housing requirements.
Five years later, according to Michael Andersen, senior researcher in housing and transportation for Sightline Institute, the number of projects has not increased.
“I'm coming to this from the perception that (the number of buildings) over the course of a few years is not very many buildings,” Andersen said. “And it doesn't meet the scale of the program as envisioned.”
The same Portland State University report found developers are coming up with creative ways to avoid the Inclusionary Housing mandate.
“There have already been a few permits at the city that have multiple buildings in a development, instead of one larger building, to stay under the 20-unit threshold,” the report found. “Although building two separate buildings does add costs to a project, those costs may still be less than any of the IH options.”
According to other experts, there’s another way of doing things that might lead to larger buildings and more affordable housing availability.
Parking reform and housing supply
Some parking reform advocates say reducing parking requirements will lead to a boom in housing production, which could increase affordable housing production.
The primary reason for this is, simply put, parking takes up a lot of space and costs a lot of money to construct.
Parking requirements differ according to different rules set by cities. Sometimes the requirement is two spaces for each apartment, or it’s one space for two apartments, according to Catie Gould, climate and transportation researcher with Sightline Institute. In every case, Gould said in her experience, every developer says it is limited in the number of homes it can build because of the parking.
When the parking requirement is lowered, it allows for more flexibility for a developer.
“It kind of lowers the threshold of what makes your project pencil out economically, because parking is so expensive,” Gould said. “So it's kind of a return to how we used to build housing a long time ago.”
A few Oregon House bills have passed in recent years that included loosening or eliminating parking regulations, resulting in Oregon building more housing.
One of those bills, House Bill 2001 in 2019, allowed for greater flexibility like duplexes for single-family homes. It also allowed for developers to build Accessory Dwelling Units, or ADUs, also known as tiny houses, without needing to follow strict parking regulations.
According to Andersen, the city of Portland was not affected by the rule changes because it had already implemented parking changes. But for cities outside of Portland, the effect was enormous.
After House Bill 2001 came out, the number of building permits per year that were awarded in cities of 10,000 or more people climbed from just under 200 to 350, according to Andersen.
Just by reducing parking requirements, more housing — including more affordable housing in the form of ADUs — was built.
As Andersen pointed out, Portland has been altering parking requirements for years.
In 1991, Portland started enacting zoning regulations to remove off-street parking requirements for new developments in “Storefront Commercial” zoning and “Mixed-Use Commercial” zoning along some commercial streets in dense areas, according to the Portland Bureau of Transportation. The city later nixed that requirement for any site within 1,500 feet of a transit station or 500 feet of a street with 20-minute transit service during commute times.
Between 2006 and 2012, there were approximately 55 buildings and 1,270 dwelling units built without dedicated off-street parking, according to the transportation bureau’s guidebook.
But the increased housing brought pushback from neighbors. Between 2013 and 2016, Portland City Council adopted new minimum parking requirements for apartment buildings located on frequent transit lines. The new rule allowed developers to build up to 30 new units with no parking.
Tony Jordan, president of the Parking Reform Network, said the rule suddenly led to developers building 30-unit apartments.
The sudden increase in 30-unit apartments was proof to Jordan that developers were willing to build more when parking requirements and the associated costs were diminished. Jordan said the mandate caused a construction boom without the city having to pay for it.
Despite increased construction, however, rents in Portland continued to climb. And, as Street Roots reported in 2022, a blanket solution to the housing shortage is unlikely to decrease existing rents, only slow the rate at which rents climb.
Experts like Hallovà, however, say increased density via efforts like reduced parking requirements can make housing more affordable in the long run.
“You need subsidy to make them affordable today if they're brand new,” Hallovà said. “What's great about density in urban cores is that over time those become the most affordable units.”
Hallova also said when looking at affordability, density in urban cores can help in the bigger picture of affordability, by making things like gas and utilities cheaper for people, because they are living closer to things like work, school and stores.
History
This is the first time Oregon has passed parking mandate rollbacks like these. But a lack of parking requirements used to be commonplace, according to Gould.
“Before the 1950s is when these rules were primarily adopted by cities across the country. It was never something that the state required in the first place,” Gould said. “It was just common practice for cities to adopt these rules, and they kind of copied each other's ratios, and there's not a lot of grounding in where those numbers came from.”
Other states have also gotten rid of parking mandates, Jordan said. The Parking Reform Network website features a U.S. map with different areas highlighted where parking requirements have been curtailed or eliminated.
According to Jordan, in the late 2010s, several cities started getting rid of their mandates, such as Buffalo, New York and San Francisco. Since then, the practice has picked up steam. There are now roughly 40 cities that have eliminated parking mandates.
By June 30, Oregon will require bigger cities to get rid of parking mandates. Jordan calls it the most advanced statewide bill that’s been passed. In other states, the statewide parking reforms don’t apply to every city. In California, for example, cities don’t have to roll back parking mandates for projects that are not near high-quality transit.
Other solutions
Nick Sauvie, co-executive director of Rose Community Development, credits two affordable housing bond measures with providing close to a billion dollars to help build more affordable housing.
Aside from more funding, Sauvie said he would like to see the city build more apartment buildings. While both Residential Infill Projects focused on efforts to build “plex” properties, the term used to describe homes like duplexes and triplexes, Sauvie said these will not directly benefit those who need affordable housing.
“Most people that are low income need to live in apartment buildings,” Sauvie said. “They can't afford a standard plex building.”
Sauvie said the city’s strategy has been to fit multi-family buildings in wherever possible in the city. While that has been somewhat effective, Sauvie said both the land and construction are more expensive that way.
“We need other zoning to allow just basic apartment buildings to be built in more areas of the city,” Sauvie said.
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