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Shared community vision links housing to transit 

A program to match real estate development with area transit lines in Portland, OR increasingly is targeting affordable housing after regional government found low-income residents ride metro area trains and buses more than other groups do.

Jonathan Williams, senior project development manager of the Transit-Oriented Development (TOD) program at Metro (the elected regional government for the Oregon part of the Portland MSA) says, “There’s been a real strong pivot toward affordable housing” in the past couple of years.

He says that in 2017, 70 percent of units his department participated in (through land acquisition or gap financing) were affordable (628 of a total of 882). And in 2018, the market share grew to 90 percent (650 of 726).

That compares to the historical average of 38 percent affordable units (2,228 of 5,871) since the TOD project was started in 1999 to encourage people to move into areas adjacent to rail or bus lines. The catalyst was rule changes in December 2016 that tied the program to allocations based on ridership numbers. The TOD has a budget of $3 million a year to support development along the light rail and bus systems.

“Metro does surveys on household travel behavior, and we were able to show there was significantly higher ridership coming out of lower income households,” says Williams. It was as much as 15 percent higher for rail and 40 percent higher for bus lines.

“We basically added that into our funding formula. Once we were able to demonstrate we were getting more ridership out of affordable projects, we were able to adjust our funding formula.”

Portland’s TOD effort dates back to 1999, says Williams. “We’d just opened the West Side light rail system, our West Side Blue Line MAX system. The original idea back then was to support getting higher density and more transit-oriented development along the light rail system.”

Metro’s TOD usually contributes between $250,000 and $500,000 to a project, and occasionally acquires land for one.

Successful examples
One such project is the Orchards of 82nd (formerly the JADE Project), which is 47 units, all affordable. Metro contributed $680,000 to acquire the land and $515,000 in gap financing.

Additional funding came in the form of $9.76 million of LIHTC nine percent credits allocated to nonprofit developer Rose Community Development, $1.86 million from the Portland Housing Bureau and $914,000 from a community group, the Asian Pacific American Network of Oregon (APANO), which purchased ground floor community space.

APANO advertises its community space is near two transit lines, and Williams said a bus line will be built right by it to open in 2022.

Expected completion date for the Orchards of 82nd was last month, with the opening scheduled for April 25.

Metro is also involved in Woody Guthrie Place, with a projected completion of summer 2019, located in the Portland neighborhood of Lents right by a Green Line stop. It contributed $350,000 to this project, also being developed by Rose Community Development.

The development is named for the famous folk singer, who lived in this neighborhood in 1941 while working for the Department of the Interior to write songs about the Bonneville Power Administration’s construction of the Grand Coulee Dam. That stint produced one of Guthrie’s most enduring songs, Roll On, Columbia, Roll On, and several other songs about the big river.

Rose real estate developer Erik Pattison says Woody Guthrie Place is, “Located very close to the light rail here.” The mixed-income project is being done “in partnership with an urban renewal agency, Prosper Portland, and the local housing bureau.”

There’s another direct transit link with the Woody Guthrie project. “Some of the funds from Metro will be used to provide transit passes to the residents to encourage ridership,” says Pattison.

This project had a total cost of $21 million, with Rose using the FHA 221(d)(4) multifamily rehab and new construction loan, according to Pattison.

Pattison was noncommittal on whether Rose would be doing more of these kinds of transit-linked projects.

However, access to transit is a factor that usually is weighed in all of their housing projects.

“I think that the intention is to provide the best location, with general access to transportation being one of the important considerations. Also, schools and parks.”

Shared Vision
The many different organizations that team up on projects like these point to a shared vision for affordable housing in the state.

It helps that Oregon is a place that has traditionally been friendly to affordable housing. Governor Kate Brown, re-elected last November, campaigned on the affordable housing issue. Ted Wheeler, Portland’s mayor, is also a housing advocate. And city voters approved a hefty affordable housing measure last November.

Portland Measure 26-199 authorized $652.8 million for affordable housing projects in Clackamas, Washington and Multnomah counties. The ballot question specified the money will go for housing for “low-income families, seniors, veterans and people with disabilities.”

And Portland’s Regional Transportation Plan, updated every four years, particularly ties transit to housing, according to Metro’s description of the RTP.

“Affordability is intimately linked to the roads and transit people use every day to get to work and other destinations. If the housing is affordable, but the commute is costly and burdensome, people can still struggle to get by. That’s why Metro defines cost-burdened households based on the portion of household income spent on housing plus transportation, rather than housing alone,” it says.

“The RTP framework seeks to support the production and preservation of affordable housing in the region by ensuring the availability of transportation options that connect communities with a range of housing, employment and educational opportunities.”

Story contacts:
Jonathan Williams, Senior Project Development Manager
Metro Transit-Oriented Development

Erik Pattison, Real Estate Developer
Rose Community Development

Mark Fogarty has covered housing and mortgages for more than 30 years. A former editor at National Mortgage News, he has written extensively about tax credits.