Transcript
Automatically generated transcript. It may contain errors and includes testimony in languages other than English that is not individually marked up for assistive technology.
Loretta Smith
Keelan, I'm here.
This is Councilor Smith.
Elana Pirtle-Guiney
Can you hear us online, Councilor Smith?
Loretta Smith
Yes, I am.
Olivia Clark
We can hear you.
Candace Avalos
Thank you.
Angelita Morillo
Good morning.
Keith Wilson
Good morning.
Jamie Dunphy
Calling to order the Wednesday— no, Thursday, March 5th work session of the Portland City Council.
Colleagues, this morning we're going to spend some— hear a presentation from our friends at the Housing Bureau.
We're going to have ample time for discussion about the unspent Housing Bureau dollars.
I'm going to be turning facilitation of this meeting over to the chair of the Housing and Homelessness Committee, Councilor Avalos.
Take it away.
Candace Avalos
Thank you so much, Council President.
So good morning, colleagues.
Thank you for being here.
So we have taken a long winding road to get to this point, but I'd like us to put aside any frustrations with the extended process and focus on the important opportunity in front of us.
As many of you know, Council recently identified approximately $106 million in housing-related balances that were not previously budgeted for allocation.
So today's work session is an opportunity for us to step back and ensure that we all share a common understanding understanding of the funding available to us, the constraints attached to those funds, and the range of policy options before council.
Over the past several months, council has had substantial conversations about housing priorities, including prevention strategies, housing production, and longer-term structural solutions.
Today is not meant to start those conversations from scratch, but rather to build on that work and provide space for a comprehensive discussion about how these resources might Thank you, Councilor Smith.
Thank you, Mayor.
Councilor Smith, you have the floor.
Thank you, Mayor.
I'm pleased to be here today to discuss the proposed 2024-25 housing budget.
This is a critical document for the city of Portland.
It outlines the funding priorities and constraints that will be available to support our shared housing goals.
This session is designed primarily as a working discussion among council, supported by staff to help clarify the technical details.
And my hope is that by the end of the conversation, we will have a shared understanding of the funding categories and constraints, clarity around areas where councilors may already have alignment, a clearer sense of where additional discussion or policy development may be needed.
And this is also the time to surface new ideas or priorities if councilors believe there are gaps in the options currently We are going to begin with a staff presentation to ground us in the financial details and then move into 2 structured discussion blocks.
First, we're gonna focus on clarifying the available options and then on policy priorities and potential allocation approaches.
So my role today will simply be to help facilitate the conversation, ensure that everyone has the space to contribute, and keep us moving through the agenda.
And so with that, I'm gonna turn it over to staff for the first part of our presentation.
Thank you, Deputy City Administrator.
Come on up.
Donnie Oliveira
Who's, who's driving?
Michael Bonacore
Uh, Priya.
Good morning, Council President, councilors.
Michael Bonacore, interim, uh, director for the Portland Housing Bureau.
I wanna start by saying thank you all for the time that you spent in the small briefings leading up to today.
As Donnie said, we used those conversations to sort of hone our presentation, get more clear on what kind of information is gonna be most helpful for you and for the public to, you know, understand this issue as clearly as possible.
So as I tee this up, just a few things in that realm.
We tuned into terminology that we're using and clarity in how we present information.
So you're not going to see references to NOFAs or RFPs.
You're going to see the word solicitation, which simply means any number of ways by which resources are made available to the public through competitive processes.
Jonas Biery
Thank you.
Michael Bonacore
There is one reference to contingency, and it's a very specific— specifically used.
But otherwise, we're basically talking about these funds as held for future expenditure.
The old deck referred to unrestricted contingency, which caused some confusion.
You'll now see funds presented as having committed uses or PHB proposed uses, and I'll point it out when we When we get there.
The presentation of funds across multiple years wasn't super helpful in some cases.
It was confusing.
So we're now using rounded numbers that you can easily track up and down columns and across rows.
And then at the end, we'll tie those numbers back to what was presented in CA Lee's memo so it's easy to track between the two.
As a reminder, as we said in the briefings, federal grants are excluded from this exercise.
Those are driven by approved grant plans and held by the sponsor, usually HUD, and distributed to us on a reimbursement basis, not held as cash on hand.
And we weren't sure as we approached those small group briefings what your appetite might be for sort of context setting and information sharing about how PHB manages its funds and makes long-term investment decisions, how our funds are monitored.
We heard back that you are interested in learning more.
Adrian Delgado
Thank you.
Michael Bonacore
More rather than less.
And so you'll see that as we now get into the presentation.
And with all that said, I appreciate— I know you all are willing to hold your questions to the end.
I know you'll have many.
I'll be happy to start all the way back from the beginning of the deck if that's what's most helpful to you all.
So thank you for that.
Next slide.
So we'll be going through this presentation in 3 chunks, some background, some information about how we have managed our accrued funds, and Then we'll get into the detail of the subfund balances.
Next slide.
So these first few slides of background try to get at some of the questions in the vein of where was the money, who can see the money, how is money accounted for.
Next slide.
So first, let's talk about the ACFR, the Annual Comprehensive Financial Reports.
From the city's website, the accounting departments of the City of Portland and Prosper Portland prepare financial statements, also known as annual comprehensive financial reports.
An external financial auditor audits these financial statements every year and issues audit opinions.
The ending fund balances for the prior fiscal year are displayed in the ACFR, which is presented annually to City Council and is published on the city's public website.
Next slide.
So All of the Portland Housing Bureau's funds are represented in the ACFER, maddeningly misrepresented as AFKER in the title, so apologies for that.
So all of the funds are represented here, including those that were excluded from the forward-looking budget.
No funds have been found to be missing or misspent or in the wrong place.
However, presenting funding in this way requires translation for council and the public to understand how these ending Fund balances carry over into each new fiscal year budget and what is proposed to be held for future expenditures.
In other words, the money's all there, but you can't just look at that and understand how that translates into our budget.
And PHB's responsibility is to present that information clearly to Council during the budget process so it has information for its deliberations and decision-making.
So said simply, as you've heard me say before, That is not how PHB has ever presented its budget in the past.
That is a process that we are going through now in collaboration with CBO and with Jonas.
It is a really significant transition process, and it is still underway.
Once that change is made, it will be made forever, and you will be able to look at the full picture of our finances in a way that has not Heretofore been available to you and therefore limits your ability to fully understand your decision-making authority in the budget process.
So we will fix that.
In addition to the ACVOR process, PHB also goes and undergoes an annual audit of its federal HUD grants through the City of Portland's single audit, which is also published on portland.gov.
Link is there.
And then finally, an external audit of the Portland Housing Bond is required every year until all funds are fully expended.
Between these 3 processes, PHB has been audited 14 times since 2020 with zero financial findings.
Now, it's also important to say that in this process, you all have asked for a comprehensive audit of the Bureau, and that is not the same as these.
I want to acknowledge that difference and that we are committed to going through that process and making those findings available to you all.
Next slide.
I think we all understand this now, but the public, I think, does not yet fully understand that there is not $106 million to spend.
It's important to be honest that the $21 million in unspent Rental Services Office funds Yes.
So that is a specific issue.
Those funds should have been put out into the community.
Those are operating dollars and they should have been deployed, not held and accumulated at that level.
The remaining amount in the total of $106 million is largely committed.
So they're tied to specific commitments or proposed plans for future housing-related priorities.
However, you all have the opportunity to make different choices than what PHB has proposed, and we look forward to having that conversation and potentially trade-offs with you.
Next slide.
So a bit more background, a lot of which you have seen, but we'll review, especially again for the public's benefit, along with some new information.
Eric Zimmerman
Next slide.
Michael Bonacore
So as you've heard me say, we typically wait until we have at least $20 million to put out in a solicitation Often it's a larger amount than that, but at least that amount allows us to fund a few projects at a reasonably significant level to do some important work.
On the left side of that sunburst, you look at the different sources of funds and see how long on their own it would take for them to accrue to those amounts.
And so the way that— The Bureau manages those solicitations is to braid those funds together and get them out at a sort of a regular cadence.
And then on the other side of the sunburst is the development process and the disbursement of funds, which typically lasts anywhere from 5 to 7 years.
Next slide.
Some information we hadn't broken out for you in the past, but the sort of the Value of a solicitation process is that it gives us the opportunity to define what kinds of goals we're trying to achieve with the money that we're putting out into the community.
Things like the number of units, bedroom sizes, permanent supportive housing, affordability, populations served, and geographies.
It gives us the opportunity to determine whether to release properties along with cash.
So there are PHB-controlled sites that we can pair with available funding to sort of increase the impact of those projects.
We are on the verge of releasing a production NOFA in which a property in Mount Tabor and a property in Gateway will be made available along with funding.
This also gives us the opportunity to articulate funding requirements and restrictions.
So things like our own internal policies around maximum subsidy per unit, cost containment priorities, And funding source parameters.
So each of those funding types that we looked at, you know, comes with its own sort of sets of requirements and parameters.
And parenthetically, you see early investor.
Very often we are an early investor, if not the first money in, and that gives us the opportunity to have more ability to define some of these issues such as cost containment that may be important to us.
Once a project is farther in the development, cycle, those things are already baked in and there's less leverage for us to sort of get the kinds of impacts that we may sort of have defined earlier on if we were— if it was— if we were early money.
And then importantly, these solicitations allow us to conduct outreach and provide information sessions before the solicitations are released.
And that gives— makes sure that there's a fair opportunity that folks in the community know this money will be coming available and have—.
Mitch Green
Yes.
Michael Bonacore
The opportunity to put forward their eligible project— projects for consideration through a public competitive process.
Jonas Biery
Next slide.
Michael Bonacore
So here's a look back at the last 5 years of housing production.
It sort of reinforces the idea that we braid funds.
And if you look in each of these years, the combination of funds, types of funds that were put together are different in each of the years.
Currently, there are about 40 projects at various development stages.
And as we get to— actually, go ahead, next slide.
So when you look at this slide, this sort of talks about the process from beginning to end, and PHB staff are engaged in that process throughout the entire lifecycle.
So from the beginning where we're defining what the solicitation is and then managing that selection process, Yes.
Assessing eligibility and qualifications of the projects to pre-development, construction, and lease-up.
There are roles that technical experts in the Bureau play to sort of help guide and support the projects in the development lifecycle.
So as we think about how, you know, how we're pacing the release of funds into the community, we're also thinking about how all these projects stack up and the bandwidth of the staff to manage all of them.
Next slide.
So this is a slight variation on a slide we talked about in the briefings.
I had said verbally that if you imagined looking backward from '26-'27, you would see Yeah.
You know, bars that are of a significant height.
And when you look at them, you see just sort of what a stark contrast these next 5 years will be as funding declines.
In particular, you can see sort of the stark decrease of the bonds and the diminishment of TIF.
And so as we think about, You know, what the future looks like and understanding too that a forecast is simply a forecast.
We don't know if there could be another housing revenue source that becomes available.
We don't know if the federal government will step up differently than it has in the last few years.
But based on what we know, we're expecting these next few years to be not resource-rich in the way that they have in the last several years for us.
Jonas Biery
Next slide.
Michael Bonacore
And again, this is just a snapshot of that work over the past 5 years, which has resulted in over half a billion dollars of economic activity and renter support and housing production in the community.
Next slide.
So now we get back into the presentation of the fund balances and sort of how those are Either committed or what the plans are for their future and how you might want to consider those.
Next slide.
So this one falls under the inclusionary housing umbrella.
And if you look at the 3rd column, you'll see the phrase committed uses.
And in the next column, you'll see the phrase PHB planned uses.
Hopefully those feel intuitive.
In the committed uses column, you'll see—.
Jonas Biery
Councilmember Herbold.
Michael Bonacore
Specific projects that we have made commitments to or ongoing program operating costs.
And then on the planned uses side, you see where we have plans for future solicitations.
And those are, you know, policy trade-off conversations for you all to have about whether you do in fact wanna hold those funds for future Solicitations or do something differently.
I'll note that while the $6 million contingency is arguably a planned use, Councilor, here's a legit contingency for you.
The idea here is that every, pretty much every project that is going through and has recently gone through our development project faces, because of increased interest rates, You know, construction costs gaps that the Housing Bureau sort of negotiates helping to fill, and that ensures their viability to get to the finish line.
So there's some jeopardy for actually having those projects make it and having, you know, gaps come up that we wouldn't be able to fill in the absence of that money.
Next slide.
Jonas Biery
Thank you.
Michael Bonacore
So in this table for short-term rental, the 2 types of short-term rental funds, you see only PHB planned uses.
There are no specific commitments that have been made with these funds.
The intention is to do a preservation solicitation next year with them unless council decides to do something different.
And the note here is that given the wind-down of current TIF districts and the lag in revenue from new ones, these 2 funds figure more prominently in our ability to fund preservation and/or new development in the next few years than they have in the years prior.
Next slide.
So this table is our housing property funds.
These represent revenue generated from rents essentially at the properties and are funds that need to go back into for you know, sort of capital needs at the properties.
Next slide.
Here's a little bit of a ragtag collection of funds, all of which have very prescribed uses for them.
And I don't think I need to necessarily talk through each one of them.
I think they're labeled pretty clearly.
And You know, this isn't a huge amount of money, but they're all in, you know, funds that have very defined uses for them.
Next slide.
A couple more here.
Housing Investment is another fund that will cover staff costs and general fund overhead.
This one in particular mitigates the projected decline in program income, including the suspension of SDCs.
So with those funds not coming in, As they have been.
Now that there's a suspension of SDCs, this becomes sort of an ability to backfill that.
And then the risk mitigation pool is designed to reimburse landlords of permanent supportive housing properties for eligible damage claims.
Next slide.
So this is our last big one.
Well, this is our last one, and it's a big one.
And these are the TIF So on the left side, you see committed uses.
Those are for specific projects and for our home repair program.
On the right-hand side, you'll see some of the districts have money that is not currently allocated to specific projects.
And so that is typically work that the Bureau does either through solicitations or—.
Jonas Biery
Through grants.
Michael Bonacore
As primarily through solicitations or as opportunities become sort of made known in those districts.
And again, are developed according to action plans that are developed with the community.
Dan Ryan
Next slide.
Michael Bonacore
So finally, we heard from you all that you wanted to Be able to understand how what we're presenting to you today ties back to the information that you were provided on February 6th from City Administrator Lee.
So the 6 tables that I just talked you through total about $93 million.
There is an additional $8.9 million of RSO funds under council consideration, plus $1.8 million that were proposed Appropriated in the fall TAO.
Just to be super clear, the whole $20.7 million is there and for your decision-making.
And then there's another about $6 million that were backed out based on having been budgeted in FY25-26.
So if we go to the next slide.
So this is the table on page 7 from City Administrator Lee's memo.
Donnie Oliveira
If you—.
Michael Bonacore
So if you add up the column, the big column of numbers, that totals to $112 million.
And if you subtract out the TIF and the Inclusionary Housing Fund line items, as we did on the prior slide, then you get to $106 or $105.9.
That, I think, Is the presentation.
So we are now happy to take your, take your questions and conversation.
Loretta Smith
Thank you so much.
Candace Avalos
Here we go.
Thank you so much.
So colleagues, what we're going to do now is we're going to enter a period of technical questions, and then after that we'll take a quick break, and then we'll come back and do the facilitated discussion for— with the prompts that you received over email.
Thank you, Councilor Avalos.
Angelita Morillo
Thank you all so much for this presentation.
I had a question about the housing beginning fund balances.
So on Tuesday, the City Budget Office sent out the beginning fund balance information for all funds in the city to city financial analysts to reconcile.
And from that information provided, the total beginning fund balance across all housing funds, general fund not included, is $145 million.
We know that $8 million of that has been budgeted, leaving a net beginning fund balance of $137 million.
So right now we've been having a discussion of $106 million, and I'm wondering if you can explain the discrepancy there, because we have not been talking about $137 million.
We've been talking about $106 million.
Yeah.
Jonas Biery
Thank you, Councilor, for the question.
And yeah, this was highlighted, and I'll give a sort of a partial answer that may not be super satisfactory.
I'm honestly struggling to track those numbers.
I know I've seen numbers that were kind of provided to your office that track somewhat, but it's a little unclear.
And so I'm— I can give you a number.
Hesitant to acknowledge that because I need to frankly do a little more due diligence to understand the source of those numbers.
I've also looked at the CBO email from Tuesday and I'm not coming up with that same math.
So I'm not saying it's wrong, I just haven't been able to sort of independently verify that.
The other thing I'll note is that the ACFER ending fund balance, we're talking about a '24-'25 balance.
The numbers we've been talking about now are for '26-'27 and there's kind of a, A gap fiscal year in there in which expenditures have been made.
We know there's at least $8 million of that that was budgeted as reflected in the memo.
And so we're trying to identify if that delta is a nuance of sort of the accounting accrual for determining that fund balance amount, the ending fund balance in '24-'25.
Is there something that was budgeted as perhaps a transfer?
Olivia Clark
Yeah.
Jonas Biery
That wasn't showing up in the programmatic budget.
And so we're looking to identify that as well.
So I just appreciate the additional due diligence.
We will have it corrected and transparently reported, the reasons for that, in the spring TAO.
I just want to be really cautious that we're not continuing sort of a legacy over the last few months of providing information that isn't perfectly accurate.
So I just wanted—.
Loretta Smith
That's—.
Michael Bonacore
Thank you.
Jonas Biery
I just want to be clear about that.
And I don't mean that facetiously.
I mean that absolutely honestly, that we're trying to figure out, you know, how does that math work?
And so we can be really clear about what those numbers are and be really clear for council about the reasons for that delta.
Angelita Morillo
Yeah.
And I appreciate that you're trying to get us the correct numbers so that we don't have misinformation or misunderstandings going out to the public.
I will say my staff first reached out about this at the beginning of February.
So we are a month out into getting that information.
You see how that—.
Jonas Biery
I understand.
And I will also acknowledge that—.
Angelita Morillo
I'm not done, sir.
These numbers are also published in the ACFR, and the CBO sent those numbers out to the analysts to reconcile.
So I'm curious as to why bureaus are being asked to match published beginning fund balances if you don't believe that those are real numbers?
Jamie Dunphy
Thank you, Councilor.
Jonas Biery
That's not my suggestion.
I appreciate your analysts had provided this.
I appreciate that this is a complex situation that we're all working on.
Many of us who are doing this work, myself included, were either out of office working on other work, and so it's not We are in a very resource-constrained environment with very, very high expectations, and we're busting our asses trying to get this information accurately to the public in an environment where misinformation is continuing to be shared in the media and otherwise.
So I appreciate your analysts' work.
I appreciate the staff at the CBO and in our accounting team who are doing this, and we are working as hard as we can to get those facts out to the public as quickly as possible.
Olivia Clark
Thank you.
Elana Pirtle-Guiney
Right.
Angelita Morillo
But this is the work session where we're supposed to be getting those answers.
So we do actually need those answers in this discussion so that we know the dollars that we're working with.
Because if there is a difference between $106 million versus $137 million and the number keeps changing, We are dealing with a big issue and council can't talk about it and we can't figure out exactly what is going on.
Jonas Biery
Councilor, let me pause that for a second and back up because we do know things that council can decide upon today.
Angelita Morillo
Yes, the $21 million.
Jonas Biery
Correct.
We know that the RSO has $20.7 million.
We've talked about multiple proposals for many weeks about deploying that into the community.
Director Bonaccor just talked about buckets and if TLDR, And I know there's proposals about realigning that.
We know that there's other funds, as just described, that have restrictions around them that are much more difficult to redeploy.
And we know that we have work to do to figure out where that delta, that technical delta lies.
So I hear you and we're working on it.
And I also just would acknowledge that that doesn't have to slow down taking action.
I'm equally as frustrated.
Tiffany Koyama Lane
Thank you.
Jonas Biery
That this is complex.
It's a multi-year legacy.
I'm frustrated that we don't have resources to commit the 10 or 12 hours that I and my staff are spending 6 days a week working on all of the city's priorities, that we can't commit all that time to doing just this work.
I'm frustrated, and I would like to see us be able to start making progress on the things that we can make progress while we're also addressing those other bigger concerns and, and Okay.
Angelita Morillo
How often does your office coordinate with the accounting manager to get us accurate numbers?
Jonas Biery
I'm not sure I know how to respond to that.
The city controller reports to me, so that is my office.
We do, We have some processes in place to have connectivity between what is reflected in the audit, what's reflected in the city's SAP system, and what's used by the bureaus and budget office staff.
So I'm not sure.
I mean, that's a multifaceted question.
There are, meaning there are moments in time where there's specific actions The budget development, for example, the budget manual directs doing that connectivity at the point of doing specific budget actions.
There are also daily conversations that can occur between staff, between the accounting team and other offices.
Angelita Morillo
Yeah, I just think when we're talking about capacity, the accounting team is being underutilized because if they're going to have those accurate numbers, and I'm not asking gotcha questions, Jonas, like I truly am not trying to, But we are not getting accurate numbers.
This feels like it keeps changing.
This is the work session for us to discuss it as a body.
This is the day that we're all here together to do that.
And I don't think I'm asking complicated trick questions.
We need those accurate numbers.
Jonas Biery
Yeah, I understand.
I just would be cautious about suggesting that the numbers are not accurate.
I think that the numbers you're receiving are accurate and there's context.
Around those accurate numbers that we need to do a better job of due diligencing and being able to describe.
So I want to be really careful in continuing the narrative that there are inaccurate numbers.
There was certainly an environment where things were not budgeted the way they should have been, and that's why we're here talking about this today.
That is not the same as producing inaccurate numbers.
So I just want to be really cautious in continuing that narrative that frankly has continued for a while.
Dan Ryan
Thank you.
Jonas Biery
I mean, it's true.
I mean, it's true that it's an important piece of conversation, but it has also continued to kind of have us stumble over our feet in getting to some resolution on this specific item.
Candace Avalos
Yeah.
Angelita Morillo
And, you know, my staff informed you this was something they were looking into.
I informed you yesterday that this was something I would ask about.
I'm not catching anyone off guard.
So let's not pretend I'm doing anything unexpected.
Understood.
Jonas Biery
Totally understand, Councilor.
Just appreciate your Your Grace, in recognizing that we just haven't had time to fully vet that.
Angelita Morillo
Yes, we've had a month, and this is the work session to clear up the narratives.
So we need answers when we ask questions.
That is the expectation, frankly.
But I'm done with my questions for now.
Candace Avalos
Thank you, Councilor.
Councilor Novick.
Steve Novick
Oh, you just got it.
Elana Pirtle-Guiney
Okay, go ahead.
Steve Novick
Thank you, Madam Chair.
So one of my priorities, frankly, is to see how much we can get to the general fund of all of this.
And so I'd appreciate it if you could tell me, for each of the funds you've talked about, what potential might there be to return some money or to, to give some money to the general fund?
Michael Bonacore
My good friend Adrian Delgado is in the audience, so I'll ask Adrian to come up and give us some guidance.
Loretta Smith
Good morning.
Adrian Delgado
Thank you for the question.
Adrian Delgado, City Attorney's Office, for the record.
So I don't know that I'm going to be able to match up those funds, but I can just go through the memo that—.
Sameer Kanal
Adrian, your microphone is not on.
Dan Ryan
Hold on just a quick second.
Jamie Dunphy
I don't know if you can turn it on or if we turn that on.
Loretta Smith
No.
Michael Bonacore
Do you want to take my switch?
Adrian Delgado
Oh, now it's on.
Well, I'll get your tea.
All right, so I'll go through the memo and just identify funds for you.
Um, they're not going to necessarily match up to what was presented, but hopefully we can figure that out.
All right, so unrestricted general funds, we've got the Local Housing Trust Fund Is an unrestricted general funds.
The risk mitigation pool—.
Steve Novick
I'm sorry, I should clarify.
What I'm talking about is of funds that aren't already allocated some to the general fund, what could be sort of be shifted to the general fund?
For example, Councilor Smith's proposed amendment has $5.4 million back to the general fund from the short-term rental 2% category.
So that would be a new thing.
So I'm just sort of wondering how many opportunities are there for new things where the general fund gets money?
Adrian Delgado
So I can speak on that proposal.
The 2%, the short-term rental 2% fund can— it originates from general funds, so it could go back to the general fund.
Steve Novick
So does that mean that theoretically all of it, all $8.6 million, could go to the general fund?
Adrian Delgado
That's the short-term rental amount, $8.6 million.
Steve Novick
Okay.
And actually—.
Loretta Smith
Yeah.
Adrian Delgado
Yes.
Steve Novick
Okay.
That's the— and I'm sorry, I don't understand these as well as I should, but that's— there's the short-term rental 2% from Smith 1 and short-term rental We're talking about the short-term rental 2%?
Adrian Delgado
2% Can go back to the general fund, right?
That comes from the transient lodging tax.
Candace Avalos
Okay.
Adrian Delgado
Just consulting my notes.
Yeah, so that's a general fund tax that's unrestricted.
But short-term rental 0 to 60 nights is a restricted tax.
It's a restricted fee.
It's restricted for affordable housing and homelessness, so would not be able to go back to the general fund.
Steve Novick
Thank you.
And then speaking again of those 2 funds, going back to Table 2, I think that—.
Michael Bonacore
Could we take the presentation back to Table 2, please?
Steve Novick
So it looks like, my understanding is the Bureau was planning to use up all that money through a preservation solicitation.
And can you explain what preservation means?
Does that mean things like doing mortgage buydowns or other things to stabilize the existing pool of affordable housing?
Michael Bonacore
No, if you, well, I don't know that that's precluded here, but what we mean by a Preservation solicitation is that we would put a solicitation out for public competition.
And what typically happens is affordable housing providers bring significant capital rehab needs to us and we assess those and then make awards.
Steve Novick
So that's existing affordable housing providers to address their needs for their existing properties?
Michael Bonacore
That's right.
Loretta Smith
Yeah.
Jamie Dunphy
Okay.
Steve Novick
Okay, so this is— that's what you'd planned to do with this money?
Adrian Delgado
Yes.
Steve Novick
And so this is, I mean, this is an example of it's not really new money, it's money that you already had plans for, and that was the plan?
Sameer Kanal
Yes.
Steve Novick
So the— I mean, looking at Councilor Smith's proposal, she's got under short-term rental 0 to 60, She's got the Broadway Corridor Project, the Williams and Russell Project, that those are actual— are those things that left to your own devices you wouldn't have done that because you would've had it all in these preservation solicitations for existing affordable housing?
Michael Bonacore
I mean, objectively, the councilor's proposal is not what we've presented, so that there are differences there.
Steve Novick
Okay.
But theoretically, All of that money could, you know, could be spent as you planned it to help the existing affordable housing providers deal with issues they have in surviving and keeping their units full.
Loretta Smith
Yes.
Steve Novick
Okay.
Another question about those specific projects.
I have heard that the Broadway Corridor Williams and Russell projects, there's some indication there's interest in those projects at the state level.
Michael Bonacore
There's no commitment, but there's the possibility that we Well, I can tell you my understanding is that the state is skeptical of a need to invest in our projects because they believe we have $106 million.
Steve Novick
Okay, so my information is outdated apparently.
Candace Avalos
You—.
Steve Novick
We would not necessarily expect the state to step up and pay a share of those projects?
Michael Bonacore
We would hope that they would, but I think we're not in the position that we would hope to be in those conversations with them.
Mitch Green
Okay.
Steve Novick
And another question.
This is not necessarily directly related, but you talked about the maximum subsidy per unit rule.
What is the maximum subsidy per unit rule?
Michael Bonacore
Again, that has been an internal policy in the With the housing bonds for new production, there was a max award of $150,000 per unit, and for preservation projects, $100,000.
And I can't say that, you know, that there wasn't some wiggle room depending on circumstances, but that's generally what the Bureau has communicated to folks in the solicitations for new production versus preservation.
Steve Novick
Okay, thank you.
And let's see, I just want to be sure.
I mean, assuming you've looked at Smith 1, are there any concerns about the legal challenges to any of the ways that Smith 1 would spend the $20.7 million?
Olivia Clark
Yeah.
Donnie Oliveira
Oh, Councilor Donnie Oliveira, for the record, I I'll just chime in to say, uh, generally speaking, they're doable.
The details will matter, especially for that second tranche under the short-term rental 0 to 60 night tranche.
Uh, how we do those, they have to align with existing code.
But, uh, at a high level, yes, there would be ways to fund those projects, again, assuming they meet the standard.
Steve Novick
Okay, thank you.
Candace Avalos
All right, Councilor Clark.
Olivia Clark
Thank you, Councilor Avalos.
Um, I really appreciate that we're getting more— excuse me— transparency and clarity regarding a very complex set of, um, buckets, basically, which has led to so much misunderstanding.
They're really unfortunate.
So I appreciate getting a better understanding.
I just have 3 little points to make on the production slide.
I think it's slide 11.
It just would be helpful to know the number of units that correspond with these investments.
Tiffany Koyama Lane
Mm-hmm.
Olivia Clark
I don't think I've seen that anywhere, but if you could follow up with that, I'd really appreciate it.
It would help me understand what we're really— what the benefits really are, what we're paying for.
Secondly, on slide— the following slide, on slide 12, it seems to me that there's a missing slide here at the very end.
After the loan closeout, it seems like we should have some sort of tracking or follow-up or accountability, or how do we know that we're getting what we paid for?
Is there a follow-up in our investments in units?
And I would really like to see what the follow-up is, if there is any.
Presumably there's some so that we know we're getting what we wanted.
And then on table 6, I think Looking at slide 21, I have a question on the TIF on the South Park Blocks.
It says $7 million.
Can you tell me what that's going for?
Michael Bonacore
What we— what our planned uses are on the— in the column is that It's unidentified.
So there's $7 million available in the South Park box for acquisition, new construction, or preservation.
Loretta Smith
Okay.
Michael Bonacore
So there's nothing, nothing is committed yet with that.
Olivia Clark
I've heard in the rumor mill that that's money that may be going to PSU for their cultural performing arts plan.
Donnie Oliveira
Councilor, thanks for the question.
So this is just the PHB allocation of TIF.
So this is focused on that 45% set-aside.
So this would be targeting projects related to housing.
If you're talking about something related to the PSU project, that perhaps could come from the PROSPER allocation of TIF.
Olivia Clark
Okay, thank you for the clarification.
I appreciate it.
Thank you for the presentation.
Michael Bonacore
Thank you.
And Councilor, I can give you a couple of answers to your questions.
Units represented on slide 6 total about 3,600 units.
That includes new production and preservation.
And then when PHB loans funds to projects, they enter into a regulatory agreement with us.
So there is a compliance component post-lease-up into operation.
Olivia Clark
What is that, like a quarterly report or how?
Michael Bonacore
There's an annual report.
Candace Avalos
Okay.
Olivia Clark
And on the $3,600, how does that divide up between new and preservation?
What's the split?
Michael Bonacore
My team hears these questions and they're getting them to me, so I'll come back and answer that for you.
Olivia Clark
Thank you so much.
I appreciate it.
Thank you, Councilor Avalos.
Candace Avalos
Absolutely.
Councilor Green.
Mitch Green
Thank you, Councilor Avalos.
And these are just— we're still in the technical questions phase.
Okay, great.
So my team did— we had that nice presentation with your team that walked us through the big spreadsheet here.
And our takeaway is that there's really only about $55.9 million of money at council's discretion with degrees of discretion.
Of that, $20.7 million is very much at council's discretion.
There's no other planned uses for it.
We can spend it without any trade-off, essentially, except for the trade-offs between the different decisions we might make.
Jamie Dunphy
Correct, yes.
Mitch Green
So then if you take that number out, you're left with $30.4— and I'm sorry I'm making everyone do math here, but $30.4 million in what I would say is conditional discretion because We already have some planned uses in the Portland Housing Bureau that come from the short-term rental subfunds, which is $19.7 million, and the CET inclusionary housing fund, which is $10.7 million.
And so if we were— we could consider different uses of those funds, but then that would sort of call into question the existing NOFAs and some of the other stuff.
Is that a correct way to characterize that bucket?
Candace Avalos
Yes.
Michael Bonacore
I would say it doesn't jeopardize existing NOFAs, just future planned solicitations.
Mitch Green
Thank you for clarifying that.
That's important for folks watching on.
It's just any NOFAs that are in the pipeline that we might want to do as a future thing that those funds would support, we would be saying we're going to go a different direction.
Adrian Delgado
Yes.
Mitch Green
Okay.
And then there's— you've included a number of the TIF balances.
Just for— I think presumably just for the sake of the full presentation of information, understanding that in those balances, some are very much restricted.
But then there's also some, it looks like in particular the TIF River District, which is a district that no longer exists, which has been rolled in to capitalize the Old Town TIF District.
There's a sum of $4.8 million.
Mm-hmm.
That has, to my knowledge, no project identified.
It's just sort— it's for acquisition, new construction, or preservation.
So, and all that adds up to $55.9 million.
If council were to consider that $4.8 million of the TIF River District, we would have to— we'd be amending an action plan because we would be directing Prosper Portland how to spend that money.
Eric Zimmerman
Okay.
Mitch Green
Is that, is that a correct way to think about it?
Donnie Oliveira
Uh, Councilor, I— in this particular case, if we're talking about the Housing Bureau money, you're right that we would want to amend.
But in this particular case, that's an older action plan.
But yes, we'd want to maintain the spirit of that action plan.
We'd ask Council to get clear clarifying direction on that if there was a movement away from something not contemplated.
But this would be, again, towards housing dollars and not necessarily ECTAV I think to your question, yes, council could direct the bureau to more discreetly direct those dollars in that TIF district.
Mitch Green
I appreciate that.
And the way that I think about it is kind of complicated because the River District doesn't exist anymore.
Now it's the Old Town, but the Old Town is sort of over as well.
And so the new thing is the Westside TIF District.
And so any project that's in the Westside TIF District Presumably one could make the argument at this body that that $4.8 million could go to things like maybe say the Broadway Corridor Project.
Loretta Smith
Correct.
Candace Avalos
Okay.
Mitch Green
That's helpful for me stacking all this up.
And then colleagues, there's $58.1 million in TIF balances that is extremely restricted.
I would suggest for the sake of our discussion that that's just not on the table.
That's not on the table for us to talk about.
We don't want to muddy the water.
Elana Pirtle-Guiney
Is that fair?
Steve Novick
Is that a fair characterization?
Mitch Green
Yes, yes, that's fair.
Donnie Oliveira
All right, thank you.
Mitch Green
Um, I think the last question I have is, um, in the very last slide, on slide 23, um, there is— oh, I'm sorry, it's slide 22, page 22.
It's, um, there's a line item that says $18.9 million RSO-under council consideration.
Plus $1.8 million from FALTOW.
I don't understand that.
Can you please help me understand that?
Donnie Oliveira
Yeah, Councilor, we just wanted to be transparent to show this is that, that $20.7 RSO that you're contemplating.
Uh, as a reminder, or just for daylighting for the public, in the FALTOW, $1.8 of that was, was moved into the operating budget this year as just a normal function of how the bureaus manage that fund.
Any unspent dollars just rolls over.
So $1.8 million has already been activated, unspent, unplanned, but it's already in their operating budget.
And so the next action council takes on the RSO dollars would remove, remove the $18.9 million into the budget to make it $20.7 million.
Mitch Green
Okay, so it's still $20.7 million.
Donnie Oliveira
Still $20.7 million.
Mitch Green
It's just you're, you're crosswalking it to the fall TAO action.
Loretta Smith
Correct.
Mitch Green
For us.
Okay.
I think that concludes my technical questions.
Michael Bonacore
Thank you.
Candace Avalos
All right.
Thank you, Councilor.
Sameer Kanal
Councilor Thank you, Chair Avalos.
Um, thank you everyone for being here.
So, uh, I'm gonna start with slide 9, please.
And I just— I want to understand the timing here a little bit.
Is it— is it correct for me to interpret this as saying the first dollar in the door could take 7 to 17 years to result in a physical building that someone could be leasing up, or a preservation effort being completed and then re— I'm seeing the 5 to 7 on one hand, 2 to 10 on the other.
Michael Bonacore
Oh, sorry, those should be sort of thought of separately.
So on the left side, what that's attempting to illustrate is that if each of those funding sources needed to accrue over time to get to $20 million on its own, that's about how long it would take.
Sameer Kanal
Right, so the first dollar could be sitting there waiting for the other dollars to get to $20 million for up to 10 years.
Michael Bonacore
I mean, it's sort of, yes, it's sort of a hypothetical because as we said, we braid these funds together and combine them in a way that like they're not really sitting that long.
But that helps illustrate, I think, that the act of braiding, which is, you know, adds complexity to the process, is necessary in order to, to like arrive at these larger solicitation amounts.
Sameer Kanal
Has anyone done a comparative analysis with other jurisdictions as to that 7 to 17 year figure and if it takes longer here or shorter relative to other cities?
Michael Bonacore
I'm not aware of a comparative analysis.
I would say very informally, if our jurisdiction were moving at a dramatically faster or slower pace in the context of all the bond activity that has happened, like that would get compared.
You know, like we would be hearing that Clackamas County was moving 2 years faster than we were or whatever the case may be.
But no, specifically to answer your question, I don't believe there's been a comparative analysis done.
Sameer Kanal
Thanks.
Going to Table 1.
I have 3 questions on these tables, um, and then one question after that.
Help me understand the line CET commercial.
Um, my understanding is this is a, a tax that is the construction excise tax on construction of commercial buildings, but what are the uses that are allowed to use it?
What are we allowed to use that fund on?
Adrian Delgado
Hi, I can answer that.
Um, so construction excise tax can be used for affordable housing.
It is restricted.
It's a tax that is restricted at the state level, so it's statutorily restricted.
Um, the city, when it adopted the tax, restricted it for 35% to be transferred to Housing Bureau for affordable housing production and preservation of units at or below 60% median family income.
The state allows the city to define affordable housing, and that's just the way per ordinance right now and in code that it's restricted.
Sameer Kanal
And so this is just the 35%?
The other 65% is somewhere outside of the Housing Bureau?
Adrian Delgado
15% Goes back to the 4% is the administrative fee retained by permitting for the city.
50% Is transferred to Housing Bureau to fund finance-based incentives programs that are related to like development incentives, SDCs.
I think the Bureau could speak more on, on that restriction.
Sameer Kanal
That adds up to $104,000 though.
Loretta Smith
Okay.
Adrian Delgado
Okay, let's try again.
We've got 50, 90.
It does add up to $104 million.
I will— I'm just going from the memo.
I can check with Bureau Engineering.
Thanks.
Sameer Kanal
But the fact that it's called commercial is the funding stream, the collection side of it.
It has nothing to do with what we're allowed to spend it on in the context of this $9.7 million.
Adrian Delgado
Correct.
Sameer Kanal
Okay.
Slide—.
Steve Novick
Table 2.
Sameer Kanal
I wanna follow up on Councilor Novick's questions around the STR short-term rental funding.
So I just wanna understand, you're saying the $11.1 million has to remain within the 0 to 60-day first line here has to stay within the restrict— it's much more restricted, whereas the $8.6, does the short-term rental fee have anything to do Given its collection, given the activity that it is collecting money off of, what are the limitations in terms of spending money on tourism promotion?
Adrian Delgado
Good question.
So it is from the transient lodging tax, and it's an unrestricted tax.
So it's just a general fund.
It can go back to the general fund for any use.
Sameer Kanal
That's the 2%.
Adrian Delgado
The 2%, yeah, correct.
The city has a resolution where they've restricted the funds and give a specific, like the 2% going to the housing bureau.
But as council, you could do something else with that.
So the source of the fund itself is general fund.
Sameer Kanal
And then the 0 to 60 days, that's restricted in a different way?
Adrian Delgado
Correct.
That is a fee.
And it does have that restriction that you were just mentioning, I believe, where it has to be related to the collection, like the imposition of the fee.
And it's restricted for affordable housing and houseless homelessness initiatives.
Sameer Kanal
And is it restricted by state law or by city code?
Adrian Delgado
It is restricted by city— let's see, it is restricted by city code.
But it also has the fee restriction because it's a fee and we wouldn't, even if council decided to extend the code, it's one of the situations where it would still need to be related to the collection, the imposition of the fee.
Sameer Kanal
Right, that's exactly why I'm asking about tourism.
Yeah, exactly.
Steve Novick
Okay.
Sameer Kanal
Table 6, the River District funds as well.
I just wanted to clarify, The $5 million that are here for the Broadway Corridor Project, the $2 million for Parcel 4A and the $3 million for Parcel 6, are completely separate, right, from what has been discussed about other uses in the previous council discussions, right?
Michael Bonacore
Yes.
Sameer Kanal
So that's $5 million that doesn't— that's $5.7 million proposed, which has been proposed, that would be additional to this $5 million?
Michael Bonacore
Yes.
Sameer Kanal
Okay, that's helpful to know.
And then the The last question, and this might be something that— let me know if this is more than just technical.
It's on slide 13, and it's about the forecasted decline in revenue.
It appears to me that the 3 big buckets that are being reduced here, the largest reductions are in federal grants, which is a whole other conversation, TIF, which is already authorized, and then bonds.
Can you speak to the bonds part of it?
And just give a little more insight into how that came to be projected this way.
Olivia Clark
Sure.
Michael Bonacore
I mean, we're spending down the Portland Housing Bonds and the Metro Bonds.
Like, those have all been— there's, I think, $5 million more that's committed to Hollywood Hub from the Portland Housing Bond.
And then still some, you see over the next couple of years, still some Metro Housing Bond funds to deploy.
But they're both at the end of their—.
Sameer Kanal
And there's nothing new expected is I guess the question.
Michael Bonacore
Yes, that's right.
Candace Avalos
Okay.
Michael Bonacore
Yeah.
Sameer Kanal
Thank you, Chair Avalos.
Candace Avalos
Thank you.
Councilor Smith.
Loretta Smith
Thank you, Madam Chair.
Michael, you talked about the ACRA earlier.
The $106 million in funds, were those funds reported to Moss Adams or Baker Tilly?
That's their new name.
That's our auditor.
Did they know about those funds?
Were those put in our audit?
Jonas Biery
Councilor, yeah, good question.
They were.
I mean, we're talking different fiscal years, right?
So we're talking future budgeted balance versus historical audit.
But yes, the audit reflects Those full amounts that track to what the future fiscal year budget requires.
Loretta Smith
The $106 million, you reported it to the auditor.
So there's no modifications that need to be made on that audit that we received in '25-'26?
Jonas Biery
Yes, that's our understanding.
Loretta Smith
And so were those funds also reported when we got our credit rating?
Jamie Dunphy
Yes.
Loretta Smith
We had that.
So, so basically everybody that needed to know about it except the people who authorize it were informed.
And I agree with you that they weren't lost, they were just hidden from us.
But you shared it with everyone else, correct?
Jonas Biery
Uh, yes, including council who also sees the backwards-looking financial audit when it's completed.
Loretta Smith
No, no, no, I'm talking about in the authorization of the new budget for '26, for '25-'26.
When we were supposed to see those dollars, we were not made aware of them.
They were not put in our authorization.
Jonas Biery
Yes.
Loretta Smith
But yet, and still, you shared them with the auditor.
Jonas Biery
Um, let me be clear.
So the auditor looks at the prior year.
Loretta Smith
Yes.
Jonas Biery
So the information the auditor is looking at is the prior year, which is not the budget that looks at the upcoming year.
Loretta Smith
Okay, so let me back up because Moss Adams and Baker Tilly, that's their new name, they look to see if the numbers are within $1 million from each year, and if there are, there has to be some, some sure-up of the budget.
But what I'm asking you, and I'm trying to get to the point, did they see the full authorization as we presented it when we voted on it in May, in June?
That's what I'm asking you.
Jonas Biery
So the information that the auditor would have had, would have seen, is what the same information that was publicly presented in the budget.
Loretta Smith
Okay, so they didn't see it just like we didn't see it.
And so that's a problem.
That's a problem.
The auditor didn't see the full authorization, and that's what I'm asking you.
Um, question, Michael, Thank you, uh, Councilor Novick, for going over my $40 million.
And I went over that with, with Ruth prior to this to ask if the ideas that we had in our Smith 1, if they could be used without code changes.
And she said yes to the $20.7, yes to the $8.6, and yes to the $11.1, that those uses were accurate.
Angelita Morillo
Thank you.
Loretta Smith
But the reality is we can't begin to plan for a NOFA that's happening in the future if you're the only ones who know about the money.
And we didn't know about the money, so, so to suggest that you had plans for it and it was going to be in a future NOFA, those plans don't exist because those funds were not authorized.
And so no one knows about it but you.
So it was hidden from the council and the mayor.
It was hidden from our auditors who didn't know about it.
And so now when we go back for this year, our auditors are going to have to look at it and our audit is going to be wrong.
You may have a different way of doing things prior to this new council, but Oregon budget law hasn't changed.
Adrian Delgado
Yes.
Loretta Smith
You are supposed to— when you said to me a few weeks ago that yes, you knew you were supposed to report it to us, yes, your staff knew they were supposed to support it for, you know, report it to us, and yes, it was over a multi-year, um, uh, surplus.
So for me to come up with all these magical plans and say that you were going to do this and do that You are hiding that from us, and that is a lie, sir.
That is a lie that I don't like because we have to know about all monies.
Now, I came in on the tail end of Councilor Morillo, and she is absolutely right.
There are some things that you all know about.
I'm going to ask you this question, and I'm going to ask it very slowly and clearly.
Is there any other monies in these pots that you have not told us about that we should know about above the $106 million?
Michael?
Michael Bonacore
What we presented today is all of the unbudgeted fund balances that I'm aware of.
Loretta Smith
That you're aware of?
Candace Avalos
Mm-hmm.
Loretta Smith
So I know that Ruth is aware of maybe possibly $137 million.
And that she's been working with Morillo's office to kind of reconcile that.
So you don't know about that money?
Adrian Delgado
No.
Loretta Smith
Do you know about it, Jonas?
Jonas Biery
So, councilors, I think you caught the tail end of the conversation.
There's, I think, some gaps in information about the $137,000.
For example, that's, I think, reflective of last year's audit, what's in the ACFR, which is also different from what will be projected in the budget.
So it's kind of mixing a couple of things.
So I'll say it another way.
If it were 100, that's a comparison of ending year to ending year, and that math works.
That's accurate.
Loretta Smith
Okay.
Jonas Biery
That does not include, for example, amounts that were budgeted in the current year.
And so let's take that out.
It does not include what I believe is a large payment for Related to the housing bond.
And so that number gets smaller.
There are some deltas in individual amounts that are around that million-ish that we're looking into to understand.
Is that a nuance of the way that the accounting rules around the ACFR are developed?
Or is it—.
Loretta Smith
Whether it's cash or accrual.
Jonas Biery
Correct.
And so we're still doing that work.
It's not— I wish it was as simple as just asking a question and turning a switch and spitting out an answer.
But I just, it's particularly challenging to talk about in this environment when we don't actually know the reason why.
Loretta Smith
But you know there's something.
Adrian Delgado
There is something there.
Jonas Biery
We know there's a delta, but again, those are two, you know, it's not exactly apples to apples.
It's maybe two different flavors of apples.
And so we want to make sure that when we communicate that to council, we don't, for example, suggest that there's money available to repurpose when that's not true.
Because what we, what we really would not prefer for council is to encourage you to make a decision based upon information that's not—.
Loretta Smith
That has not been validated.
But it's some apples that we don't know about right now.
Jonas Biery
Well, we know about them now.
Loretta Smith
We know about them now.
So there are some apples out there that we have not included to the 106, right?
Jonas Biery
I mean, it's— I Again, I would just answer it's a difference.
I want to be cautious that we're sometimes conflating what's in the audit, which is different, a different standard than what is in the budget.
And so it may be true, Councilor.
Loretta Smith
So is it?
So yeah, it may be true and it's likely to be true.
Jonas Biery
I just want to be really cautious that we're—.
Loretta Smith
I know, I won't mess with that, Jonas.
Don't try to protect yet.
It's okay.
Candace Avalos
It's okay.
Loretta Smith
It's okay.
Um, but when we give information to our auditor, we have to give them the entire amount, and it appears that we did not give our auditor the entire amount.
I'm concerned and I'm troubled, and I have just— and you're going to get one of these— I have to go back to my foundation, Multnomah County.
And my staff is going to give you one.
I just gave all the councilors one.
This is so simple.
It gives you a snapshot.
And you remember when I always tell you, give me a— give me a spreadshot, Jonas.
Give me a spreadshot— spreadsheet.
This tells every piece of money in the local government, and it has a number on it, and it shows Yes.
It tells if it was funded the previous year and for what.
And it tells how much general fund money is in that particular program offer, how much other funds, and how much restricted funds.
It's just real easy.
It's real simple.
I would like us to go to this format so that we can clearly see if there are things that are taken out.
And we can see from one page, did the bureau use all their money from the previous year?
And we can see they only used Yes.
So we have that money that's going to be part of our beginning working balance.
It is so simple.
I don't know what kind of accounting we use here, but it is not working.
And so for me, if we could go to something like this, that would be so much more helpful.
I don't need a storybook of 20 pages of you giving me a story of this money and that money.
That's not clear to me.
I only know how to deal in numbers.
Numbers are so important, and I, I appreciate you admitting that there is some more apples out there, but we just don't know how many.
And I am going to, uh, give back my time to the chairwoman so we can go forward.
But I would have never had this meeting for the note before we had our oversight meeting because this— it doesn't make sense to keep beating a dead horse on this.
But we do need to know all of those numbers Okay, thank you, Councilor.
Candace Avalos
We are at 10:39.
What we have— and we were ahead of schedule, so we've had a lot more time to, um, discuss, but we're going to go until 11 for technical questions, take a 10-minute break, and then come back for the rest of the discussion.
Councilor Pirtle-Guiney.
Elana Pirtle-Guiney
Thank you, Councilor Avalos, and thank you, Council President, for setting aside time for the conversation today as well.
Jonas, I really appreciate the answer you just gave on the $137, I believe it is, million.
There are clearly still gaps, but you started to explain to us why some of those gaps exist.
I'd like to see that on paper, on these charts that we have here, as soon as possible.
I know that we need to develop a relationship where we can give you space to bring us early information that might not be complete, but we can only do that if we get And that's a piece that has not been totally consistent here.
So thank you for the start.
I appreciate it.
I recognize that we're inserting ourselves not just in some cases at the project level, but also in directing funds to specific programs different from your normal course of action.
And we're not giving you broader policy guidance beyond these dollars about whether that's a permanent change or a temporary change.
I think that's a good point.
Right now, these dollars change.
We're here because there was incomplete information and broken trust and some budget and accounting inconsistencies that I know we are in the process of correcting.
And Jonas, I know we've talked about making sure those are corrected in every bureau.
But for better or worse, at this point in the conversation, we have a lot of interested stakeholders and a lot of programs on the table that for each item in councilor amendments, at least one person up here cares about greatly.
So what I want to try to understand better are the $30.4 million in uncommitted funds, because I think our decisions are threefold.
What are we going to do to avoid a situation like this in the future so that we're not digging into the work that we generally ask you to do, Mr.
Thank you, Councilor Herbold.
Thank you, Councilor Herbold.
Thank you, Councilor Bonaccort.
And with the funds before us, whether we want to dig into that $30.4 million in uncommitted dollars or any of the other funds outside of that, and if so, what our priorities are.
So I want to look at Tables 1 and 2.
We've talked a fair amount about Table 2.
I fully understand the $8.6 million.
I think the last explanation about the $11.1 million, that there's a fair amount of flexibility there as long as it is tied to the fee helps to clear up the final questions I had there.
But on Table 1, I don't think we've spent as much time understanding the planned uses and the potential uses.
So under planned uses, there's a fair amount of money here listed for a 2028 new construction solicitation, an OFA in 2028.
Why are these funds set aside to use in 2028?
When we know we have a housing crisis now?
Can you explain the thinking at the Bureau in waiting an additional 2 years to even talk about those funds?
Michael Bonacore
Sure.
So, you know, given the decline in bond funds and in TIF, we just, you know, going forward, unless there is new revenue, are not going to be able to accrue money at a pace that allows us to do annual solicitations.
So I think this is just a projection of we do one, you know, for preservation next year and do a new construction in 2028.
Elana Pirtle-Guiney
Are there reasons not to spend it sooner given the housing crisis that we're in right now other than just looking out and knowing that we won't have Yeah, I mean, entirely a policy, you know, and strategic debate for you all to have.
Michael Bonacore
I completely understand the question.
I would say, you know, we've been in a crisis and I think we anticipate in 2 or 3 years we will continue to be in a crisis and very far behind in our, you know, housing production needs.
And so I think that's a really important conversation to have.
But again, as I've said, you know, there's a very real timing strategy question for you all to have.
And I, you know, completely appreciate that.
Elana Pirtle-Guiney
Thank you.
And I understand that sometimes there's a need to balance staff capacity and things like that.
I do think that waiting because we will still be in a crisis when we could start building more housing sooner is difficult.
On the construction excise tax buckets, it looks like there's $10.7 total in funding in that planned uses but not committed uses category.
What are the full restrictions there?
I know we heard the breakdown.
There's 35% for affordable production and preservation of 60% AMI or less.
Yes.
Olivia Clark
Yes.
Elana Pirtle-Guiney
It sounds like that provision is in code.
So I guess a couple of specific questions.
Is the affordable production piece of that also tied to 60% AMI or less?
First question.
Um, second question, are those restrictions in our code or are they in an agreement with the State when we started levying these taxes?
And third question, are there any other restrictions around how we spend the funds in terms of a breakdown between production and preservation, or what counts as preservation that we should know about as we think about that bucket of funds?
Michael Bonacore
I'm mostly going to defer to Adrienne.
I think on the last part though, I don't think there's anything that defines a certain percentage has to be spent on new production versus preservation.
Adrian Delgado
Yes.
So, okay, catch me if I am not answering your question, please, and redirect.
But I think we're just talking about these funds being in that 35% category, and we're going to do a check on the exact breakdown.
But yes, correct that they must be used— so statutorily, they must be used for affordable housing.
When the city enacted the tax, it adopted an ordinance and it defined the use as affordable housing by the Housing Bureau, affordable housing production and preservation of units at or below 60% So right now, that is the city's restriction.
It would— the city could amend the ordinance and amend the code to redefine affordable housing.
So if you wanted to use it, you know, you wanted to allow it to go up to 120% because for CET, that is the use the city wanted, the way that the city wanted to define affordable housing, that would be possible.
Thank you.
Elana Pirtle-Guiney
And on the preservation, is there a definition for preservation attached to this, or is preservation here meaning solely new roof, things that keep things in production, things spending money to re-up the length of time something is in operation?
Loretta Smith
No.
Adrian Delgado
I'm not aware that preservation is defined in code by the city, and so we would just go to the general dictionary definition, which is— I'm going to assume that it's the preservation of existing I'm housing.
Sorry, I don't have my computer in front of me to look it up— relatively broad.
So I'm not sure I understand what you mean by filling units, but I think Michael could probably speak a little bit more on how preservation has been interpreted by the Housing Bureau in the past.
Elana Pirtle-Guiney
Director?
Adrian Delgado
Sure.
Michael Bonacore
I mean, primarily in the ways that you've articulated.
Can you say—.
Elana Pirtle-Guiney
Could you say more about We've had a lot of conversations as a council about the unfilled units in some of our affordable housing complexes around the city and what we might be able to do, what tools we might have in order to ensure that those units are filled.
And I'm wondering if preservation dollars as defined here could be used in those cases or not.
And I'll return to the fact that I understand that what we're talking about is getting into the weeds And later I will talk about whether that is a good thing or not, but I'm trying to understand all of the parameters for what I consider the only pot of money we should be— or pots of money we should be looking at, which are the original $20.7 million in RSOs that we've talked about, and then the $30.4 million identified in planned but not committed uses on Tables 1 and 2.
Councilor Herbold.
Michael Bonacore
I think conceptually, yes.
It really, I think, just becomes a question of— I mean, I know you have given some thought to security enhancements at properties.
Is that the sort of thing you might be thinking about?
Elana Pirtle-Guiney
Security enhancements, mortgage buydowns that allow for rent to be lowered for targeted units, support with turning over units That have been heavily damaged.
Those are 3 examples of things that I have heard from providers and have had conversations with colleagues about.
Michael Bonacore
Yeah, I think, you know, depending on the specific intervention, we'd want to just check in with legal, but I believe those are all in the spirit of preservation.
Olivia Clark
Thank you.
Elana Pirtle-Guiney
Thank you, Councilor Avalos.
Candace Avalos
All right, Councilor Ryan.
Dan Ryan
Yes, thank you, Chair Avalos.
Clearly it was needed to take a collective breath on this today.
Um, first of all, I know that each housing project is very complicated.
There's multiple revenue streams which ask for different reporting guidelines.
Looking at, looking at the entire bureau and cleaning it up to improve standards is a lot of work, and I want to thank you, Jonas, And for working with your boss, City Administrator Lee, and your team for the many hours you're devoting to this at Portland Housing Bureau and for the entire city.
I'm looking for additional clarity as I struggled to achieve that when Councilor Novick was asking questions, and I apologize if this is repetition.
Yet, as I always say in the education space, it is the key to learning, and I have found that adults need it even more than children.
Olivia Clark
Thank you.
Dan Ryan
So let's stay with trying to get to the bottom of how much we really can spend on general fund.
When— first, when I— when— what is the annual operational budget for Portland Housing Bureau?
The entire bureau, not each program.
The total that is needed since it's not legally available from restricted accounts to function as a bureau.
I think that number is $36 million.
Candace Avalos
$36 Million.
Dan Ryan
Based on an email dialogue that we've had.
Is that correct?
Michael Bonacore
My team will get me an answer.
Dan Ryan
Jonas, I think I'm just daylighting what the dialogue that you've had with my chief of staff, and I thought it was important to make sure we all heard that.
Jonas Biery
Yeah, thank you.
And I don't know the number either, if that's the question, Councilor.
Dan Ryan
So Okay, you wanna hear the question again?
Jonas Biery
Sure, if you'd be willing to, thank you.
Steve Novick
Sure.
Dan Ryan
The entire bureau, not each program.
And I understand, Adrian, you were kind of breaking it down with each line item of each program.
That's a lot for us to churn.
And I would advise that it's better to digest that for us in total as we go into budget season.
And so the question is, The entire bureau, not each program.
The total that is needed, since it's not legally available from restricted accounts— again, that's very complicated accounting practices— to function the housing bureau.
And the number that we had in dialogue with our office with you that I thought would be a softball to just get out to the whole council is $36,554,000.
Michael Bonacore
I'm waiting for an answer from my Okay.
Yeah.
Dan Ryan
And while we're waiting for that, where I'm coming from is just about operational survival for the entire city as we wrestle with the upcoming budget.
So I'm trying to use this opportunity to know if we can allocate some of that as we go forward legally into the '26-'27 budget.
And I know that you, Donnie, and legal counsel are working on it.
But I need to know the total number of dollars that could be eligible, that could be transferred to the general fund going into the '26-'27 budget.
And I'd like to, before decisions are made on how we do the budgeting for next year.
Michael Bonacore
I'm sorry, Councilor—.
Dan Ryan
If you don't have that today, let me just finish.
Tiffany Koyama Lane
It'll help.
Michael Bonacore
I'm sorry.
Dan Ryan
If not for today, that is fine.
But I hope that we have clarity on this amount as we go into the '26-'27 budget deliberations.
Michael Bonacore
Yeah, and I apologize, I may not have understood.
I may not understand your question, but there is about $12 million in general fund total in the Bureau.
Is that your question?
Dan Ryan
And that's the money that you can use that's legal, that those restricted accounts are trued up, but you still need that much money to operate your Bureau in general fund money.
Because we know that we're in a general fund operational crisis in terms of revenue.
So I'm trying to get to the bottom of that.
Michael Bonacore
Yes, we need the $12 million in general fund.
Dan Ryan
So it's $12 million, not $36 million.
Jonas Biery
I believe— I'm not totally positive, Councilor, but we can follow up.
I believe part of that includes maybe some of the pass-through money to the county.
So, but we'll need to—.
Michael Bonacore
Oh, that is where a larger number would come from.
Dan Ryan
And I can live with with this moment that we have a gap here, but I hope that there can be some focus on that sooner than later because I think it'll be very helpful for the big picture.
Does that make sense?
Michael Bonacore
It does, yeah.
So there's about $31 million that passes in general fund that passes through the Bureau to Homeless Services Division at the county.
So that doesn't stay in the Bureau.
And then apart from that, there's about $12 million in general fund that's—.
Dan Ryan
That's a past practice.
So I would— for me, it'd be more helpful to know what you would need without passing money on to the county, because to me that doesn't do much for our operational budget for '26-'27.
Michael Bonacore
Are you asking if we need the $12 million in general fund that we currently have?
Dan Ryan
I'm asking because of the very complicated accounting structures when you have multiple Yes.
So we have several restricted accounts, and each of them— government, foundation, wherever they're coming from— has different reporting requirements.
Some will allow you to use general— some of that funds for general funds.
Some have different requirements.
That's what I have always discovered.
So I always found it challenging to get to the bottom line of how much money you need in the general fund as we go into the budget season '26-'27.
And I'm hoping that all of this truing up and cleaning up will give us some clarity on that so we could perhaps use that money for '26-'27 since we have a general fund crisis.
I'm looking over there now so that this could help us as we build our budget for '26-'27.
That's where I'm coming from.
No gotcha here, trying to be helpful.
You understand what I'm asking?
Olivia Clark
Yes.
Dan Ryan
Thank you, City Administrator.
And then technical question number 2, it's my final one.
Going forward, we can either accept the previous allocated amounts that have been provided for us today, 'cause today I think was a little bit of air out of the balloon, like, oh, all of this was already mostly accounted for.
So I need to know what we're doing today and what we're doing going forward is we can undo and seek a different focus Or we live with what you have in this document that I just listened to earlier in the session, where in fact, oh, there's not as much as we thought because it was allocated, in fact planned expectations for the following reasons.
Michael Bonacore
Yes, I think the conversation as I understand it that I've I've heard from you all is that there's clarity that the $21 million, $20.7 million in RSO funds needs to be allocated by council.
And then a decision needs to be made about whether proposed uses, particularly in CET and short-term rental, will be allocated from—.
Dan Ryan
And I think it's helpful not to use acronyms so public's listening.
Jonas Biery
Sorry.
Michael Bonacore
In construction excise tax or in short-term rental bucket.
That are proposed uses but not committed, whether Council wants to make allocations of those funds.
Dan Ryan
Very helpful, Michael.
I appreciate that.
So those are technical questions.
They're now over.
Strategic questions start to get us into the next step, and I'll stop.
Thank you.
Candace Avalos
Thank you, colleagues.
So timing-wise, we have 3 more minutes technically.
I'm willing to give it a little bit more time.
We've got a couple of folks here on the list.
Um, everybody is on their second round, so before I move to second round folks, I want to ask if Councilor Koyama Lane or Council President Dunphy have anything they want to ask.
Just making space for you if you need it.
Okay, so why don't we aim to go until about 11:05 if that's okay?
Just get this last round of technical questions and then we'll take a break.
Councilor Novick.
Steve Novick
Thank you, Madam Chair.
So what I think that what council is sort of considering in broad strokes is choosing between rent assistance, preservation of existing affordable housing, building new housing, and the general fund.
And I'm glad that we've sort of highlighted today that if council did nothing, $19.7 million would go to preserving and presumably maximizing the use of and occupancy of existing affordable housing.
Olivia Clark
Right.
Steve Novick
So if we decide to reduce that amount below $19 million, we're reducing the amount for that purpose.
Intuitively, to me, it seems like maximizing our existing affordable housing is pretty good bang for the buck.
But could you give us some thoughts as to how we would go about evaluating the relative bang for the buck of preservation of existing affordable housing, providing rent assistance, I can take a shot.
Michael Bonacore
I think maybe one clarification that may be helpful is that I think a lot of the consideration that's being given to the $21 million is referred to as rent assistance.
The Bureau itself has even used that term.
And I think folks often think of rent assistance as an ongoing subsidy.
And I think a lot of what is being contemplated is really around eviction legal defense and sort of short-term interventions that could include some amount of financial assistance to like cover back rent, but not ongoing rent assistance like what folks think of as the sort of programs that the county or Home Forward runs.
Jonas Biery
Yeah.
Michael Bonacore
So, If we're torturing fruit analogies, I think we're, you know, we're apples and oranges and bananas.
Donnie Oliveira
It's—.
Michael Bonacore
There are lots of different considerations that go into sort of immediate-term interventions that respond to the precarity of renters today and sort of the longer-term needs that are understood in the affordable housing portfolio.
And I think that's, I'm not trying to duck it, but that's really a debate for all of you to have.
You know, in terms of how to, you know, sort of assess the value of bang for the buck, that would be an exercise we'd have to put some thought into.
Steve Novick
I'd appreciate that exercise.
I mean, just looking at Councilor Smith's proposal, Rent assistance for tenants is $3.9 million.
Rent assistance and rapid rehousing for tenants facing eviction is $2 million.
Rent assistance for individuals experiencing homelessness, sheltered housing, that's the mayor's thing, is $3 million.
There is the right to counsel thing, that's $1.9 million.
But most of it is just what Councilor Loretta Smith is suggesting, and I think what we've just talked about before, is rent assistance.
And I, to me, if you could have used that $19 million for rent assistance before, but you decided you wanted to use it to preserve and expand the— increase the use of existing affordable housing, then I would hope that you've gone through sort of an exercise of concluding that preserving and maximizing the value of existing affordable housing is preferable.
So if somebody in the past— I know, Mr. Bhattacharya, you're new— but if somebody in the past has gone through that exercise, I'd like to see it.
If you could try to come up with some justification or withdrawal of justification for spending that money on preservation rather than rent assistance, I'd like to see it.
Michael Bonacore
And I apologize, Councilor.
I don't think I had the right frame.
I think in Councilor Smith's proposal and the slow the flow inflow, there are proposed uses that are very consistent with how RSO, the Renter Services Office, would deploy those funds.
And then in these, in the construction excise tax and short-term rent assistance buckets that are available, those are the ways that in the normal course of business, PHB would deploy those funds.
And so that's not to say that other, I mean, we're in a position where we're trying to not put our finger on the scale of what council might propose and what we think of it or not.
We're just sort of saying these are the ways that we would typically deploy the resources based on the category of funding that they come from.
Steve Novick
Okay, but I would be careful about avoiding putting your finger on the scale because you guys are the experts and I want to hear what the experts have to say.
And I want to clarify that I'm sort of thinking of this as what Councilor Smith has put on the table as a $40 million pot of money, $19 million of which would, if council didn't move, would've gone to preservation and Maximization of existing affordable housing and what factors we should be looking at if we're trying to decide whether to reduce that amount.
Dan Ryan
Yes.
Michael Bonacore
And I would say this presentation of our planned uses is our proposed, you know, consideration for you all.
Steve Novick
Thank you.
Candace Avalos
Okay, Councilor Murillo.
Angelita Morillo
Thank you, Councilor Avalos.
I'm going to ask one last question.
I'll try to be as clear as possible.
I think it's important to get it on the record.
So if the ACFR balances are not accurate, then why was the guidance provided by the City Budget Office to the city financial analysts to reconcile their budgeted beginning fund balances to those numbers?
Because you've suggested that the analysis that me and my office have done is incomplete, which is okay.
But you are also asking bureaus to use the same numbers in the spring TAO.
So I'm just not understanding the difference there.
Jonas Biery
Councilor, the balances in the ACFR are accurate as audited by the external auditor.
Angelita Morillo
Okay.
Well, I guess we'll see who's right in a few weeks regarding the $137 million.
But, uh, there— I'm telling my colleagues now, I think that there is more money there, and we will have to take a look at that.
So I will hold off further questions.
I know we're at break time.
Candace Avalos
Thank you.
Yes, we are at time, so I'm going to give you the last word if you want to take a couple minutes.
Adrian Delgado
Okay.
Loretta Smith
Thank you.
Um, thank you, Madam Chair.
I just want to go backwards I'll start and, and talk about Smith 1, which is $41 million.
It puts $20.7 million into rent assistance to help folks who are facing eviction, and it also puts rent assistance in for folks who are in shelter.
And the other $8 million, I put actually $5.1 million back into the general fund.
Michael Bonacore
Thank you.
Loretta Smith
And the, the balance of the $8.6 million goes to a project.
And as you said, um, Michael, the short-term money, we have identified, uh, projects that could be used, and none of these require any code changes at all.
They're not outside of the restricted areas.
So we did a, a good mix.
But to, to really close this with the point that Councilor Elana Councilor Smith.
Councilor Smith, I agree with what Councilor Pirtle-Guiney said.
We are in a housing crisis.
You all failed to identify purposes for the monies, and we weren't shown it.
So at this point, we need to deal with the housing crisis, and some of that housing crisis should be dealt with in terms of homeownership, keeping people in their homes who are actually getting ready to be evicted from their homes.
And if we don't do that, they're going to be out on our Yes.
It's going to cost us more to serve them if they're in a homeless shelter, um, as opposed to, uh, serving them while they're in their homes.
So those dollars, um, we try to put them in the right buckets.
And if there's something that you see that's in a wrong bucket, I'd just like to, to know what that looks like, because I worked on this with Ruth from the, uh, City Budget Office, and we tried to make sure that we didn't have to have any additional code changes.
Candace Avalos
Yes.
Loretta Smith
To that $41 million.
But if there's something wrong, if we have it in the wrong bucket, let us know and we will change it.
But we know we're in a housing crisis.
We passed the Slow the Flow to Homelessness, which identified that we should be putting some of these resources into rent assistance in addition to building additional affordable housing and affordable first-time homebuyer projects.
Angelita Morillo
Councilor Smith.
Loretta Smith
I don't know about the $62 million.
I'm only really concerned about the $40— about the $41 million.
I think those dollars are dollars that we can actually mark up and get on the streets before June 30th.
If we don't get that on the streets before June 30th, it's going to be— it's going to be impossible for us to meet the need of people who are being evicted.
Thank you.
Candace Avalos
Thank you to our panel of experts here.
We appreciate your time.
So we are going to take a quick recess.
It is 11:08.
Please be back at 11:18 and we'll begin the second half of our discussion.
Elana Pirtle-Guiney
Thanks.
Candace Avalos
Do we have any councilors lingering out there?
All right, we are going to return to our discussion.
Let everybody get settled.
Michael Bonacore
Okay.
Steve Novick
Thank you.
Candace Avalos
So before moving through these discussion prompts, I want to briefly frame this portion of the work session.
So over the past several months, council has had substantial conversations about housing investments, including prevention strategies, housing production, and longer-term structural approaches.
And today's conversation is meant to build on that work.
The goal is not necessarily to make final decisions— thank you— in this moment, but to surface where there may already be alignments and where councilors may have additional ideas or priorities That we should consider.
I'm going to walk through a few discussion prompts one at a time so we can move through them in an organized way.
And so you, uh, councilors all received these questions ahead of time.
The way that we have it timed out, I mean, it's like about 10-ish minutes per question, so I'll do my best to keep us moving.
Um, but also feel free, uh, to use your time to speak on, uh, on any question if that feels appropriate.
So we don't have to be super structured.
Um, but we will start with question 1.
And so what we wanted to do, because we have again been building this conversation, wanted to provide the essentially all of the amendments that were being introduced to see if your understanding of our current options or constraints currently before council is what we see here.
So, and if not, I want to hear what might be missing from the framework.
Are there categories or constraints that you believe should be clarified before we move further into discussion allocation?
Councilor Smith, So we're just going to kind of get grounded on what's been in front of us and get some feedback about that.
And then we'll go through each individual bucket.
We have it broken up to talk about what should the rental services type investments be, what should the development projects investments be, what kind of money do we want to set aside in contingency or perhaps set up for social housing.
And then lastly, what kind of money do we need to set aside for general fund.
So with that, let me look at my queue.
I see we've got Councilor Green first.
Go ahead and kick it off.
Mitch Green
Thank you, Councilor Avalos.
About how much time do I have?
Candace Avalos
We're going to do about 10-ish minutes each question, but we'll just kind of go from there.
Angelita Morillo
Okay.
Mitch Green
Colleagues, I've actually passed out a brief write-up to help kind of organize my thoughts in advance of this session.
My staff As well as staff from Councilor Morillo's office kind of helped put this together.
And so I've handed this out.
But I think the way I want to enter this discussion today, just speaking for myself at this juncture, is that I want to hit the reset switch a little bit on where we have been in this conversation over the last couple months.
So I don't really want to start from any particular named amendments or any previous set of proposals, but really think about what are the salient themes that came out of all those discussions and try to divide it between both demand-side interventions as well as supply-side interventions, because those are both critical to the housing problem.
I want to think about approaching this discussion in terms of 2 tiers of council action.
Tier 1 being I don't think there's a sort of immediate requirement to act now on the $20.7 million because I think we all understand that that's probably the area where we have the most council discretion and the intended use of those funds are very much about helping tenants not be evicted, right?
And making sure they stay housed or get rehoused.
They have access to a lawyer and so on and so forth.
And then there's this second tier, which is more of a call for strategic programming.
And Councilor Pirtle-Guiney, you had— you got onto a number that I— that's consistent with my number, which is $30.4 million.
And we had confirmed previously that if we were to consider $34— $30.4 million, we would be engaging with a sort of intervention in a sense of Okay.
We're not doing a lot of staff planning on what we think the out-year notice of funding availability buckets are.
And I think we need to be honest about that.
And then I finally have this like last category, which is we've talked about the Broadway corridor a lot in these previous discussions.
And as we went through this, I wouldn't do this for any other TIF line item, but I think in the context of the Broadway corridor, I think it's appropriate for us to sort of contemplate Earmarking the $4.8 million of unallocated housing set-aside funds, expanding our use of those funds to make it available for gap funding for that project, which we can get into that discussion.
Um, and so I think in Tier 1, I'd really like to see us think about dividing the $20.7 million as follows.
Um, $9 million for For sort of short-term demand-side rent assistance.
Could help 450 to 4,500 households stay stabilized.
We can have a discussion on how to condition that bucket, but I really didn't want to get into the weeds.
I want to keep this pretty high level.
$1.9 Million for eviction defense.
That's a number that we've floated up and kind of tested a couple different times.
To me, that's going to be another demand-side intervention that I think is the most humane way and also the most cost-efficient way to keep someone housed and provide meaningful legal defense dollars for that work.
And then finally, $8.8 million in emergency assistance.
Eric Zimmerman
Thank you.
Mitch Green
What I think is actually a supply-side solution, which is rent buydowns or mortgage buydowns.
We've talked about it in 2 different ways here, which gets to the stabilization question.
And the reason why I think that that's a really important intervention, colleagues, is that it's really tough to be a member of the public and hear all these headlines that say, okay, $21 million today, $40 million tomorrow, $106 million the next day, and then read another headline that says there's 1,800 units That's really tough.
And it's our job to close the loop on that.
And so I think if we step up and say, look, we have— we're taking action to correct a failure to allocate these funds, and we step in and say we are going to preserve what we have because it is the most cost-effective way to make those units available, and we've talked about different ways to preserve those units, I think that's a really good thing.
Loretta Smith
Thank you.
Mitch Green
Those units.
I've had some conversations with REACH.
I've had some conversations with Home Forward.
There's a universe in which we can be very effective in this intervention that I think we can show voters that at roughly $60,000 a unit, we can bring those units back into serviceability.
That's very cost-effective.
And then we can move into— I'm probably burning my clock down, but we can move into Tier 2.
And this is where I actually really do think we should step in and talk about what our priorities are.
I think we have a generational opportunity with this one-time money, and it is one-time money, to maybe do some pilot social housing acquisition.
You know, let's go out and buy something from the market while it is on sale, because we will not have that opportunity again.
We have a short window of time where we can step in for pennies on the dollar, acquire an asset, call it social housing.
Donnie Oliveira
Thank you.
Mitch Green
And then I think that if we're going to talk about— there's been a lot of really, like, good proposals for good projects that have, you know, specific names attached to them for gap funding.
I think we can allocate some money to, um, uh, to provide soft debt capital for that gap funding.
So create a pool of money to say for basically, you know, 0% or 1%, something less than 1%.
Michael Bonacore
1%.
Mitch Green
We can loan a long-dated loan to you to close your capital stack so you can actually get the shovels in the ground, as opposed to just a grant that goes out and we don't get it back.
So that's how I would like to approach this conversation.
I'm willing to kind of answer any questions as we get into this, like, cross-dais dialogue, but I was really hoping to reset the conversation about high-level prioritization, 2 tiers, and And really make sure that we're talking about $55.9 million or slightly less than that if you don't count that TIF district stuff and not the full $106 million because that's just not at our disposal.
So I'll leave it there for now and look forward to the conversation.
Candace Avalos
Thank you, Councilor.
Love this.
I think that's a very good place to start.
Council President Dunphy.
Jamie Dunphy
Thank you.
Yeah, Councilor Green, I really appreciate this.
This is really It really sort of boils down to me some of the conversations we've been having and the universe of ideas that have been out there and then sort of tries to bring it back based off the information we heard today.
I just want to verify though, in this scenario, while I like the 2-tier approach, just to be explicit, you would not envision returning any dollars to the general fund?
Jonas Biery
I don't have that, Alex.
Steve Novick
Okay.
Jamie Dunphy
Otherwise, I mean, like beyond that, this all really feels consistent and interesting.
Also the river, the TIF, I gotta say that the TIF, the River District TIF reallocation makes a lot of sense to me.
Those are supposed to be dollars that are used towards creation or acquisition of housing dollars.
River District doesn't exist.
And there's been obviously a lot of conversation on this dais about the future of the Broadway corridor parcel sales.
So I think this is a really great framework for us to be thinking about this and to start moving towards some consensus around.
So good job.
Thank you.
Candace Avalos
All right.
Councilor Novick.
Steve Novick
Thank you, Madam Chair.
One preliminary question I have is All of the various proposed rent assistance categories, is that short-term rent assistance?
How many people does that— do those pots envision giving people rent assistance for how many years?
Candace Avalos
Maybe I can start to answer that, and then I don't know if maybe Councilor Green, you want to add to it.
I think ultimately the way that we programmed it originally was trying to fill these short gaps, and there's actually lots of different ways to do rent assistance.
So it definitely is not on the far end of we're providing rent assistance for years and years to come.
It's more so that there are a lot of people that are about to be evicted or they're a couple months behind and being able to help them fill that gap and get stable so that they can stay in their house and continue.
Because often a lot of times it's not that people have no income, it's just that, you know, life and other things, right, they get behind.
And so the way we structured, we had it in a couple of different Because, for example, we made sure that we were ensuring dollars would get to immigrant families in particular since they have been cut off from federal resources, things like that.
So overall, to answer your question, the intent is kind of like gap financing for buildings.
It's like gap financing for humans so that they stay in their home.
Steve Novick
Thank you.
So I would like us to have an extensive discussion about rent— temporary rent assistance versus permanent rent assistance.
What Councilor Green is focused on, which is stabilizing existing affordable housing, because having affordable housing is itself rent assistance.
It's long-term rent assistance.
It means that there are units that are available at a lower rent.
And if there, there are units that are not being filled and we could do something that helps fill them, then that is a form of rent assistance for the people in those, those units.
If some of these affordable housing providers are at risk of collapsing, Then that means a whole bunch more people are evicted and the properties theoretically will be picked up, you know, to be used for unaffordable rents.
And I also just want to underscore something I said before, which is that we do not have a short-term crisis that we can expect will end in the next couple of years.
We have an ongoing crisis which we can't anticipate is going to end in the next couple of years.
And in the context of that ongoing crisis, the county has spent tens of millions, in fact, I think hundreds of millions of dollars on rent assistance, and that has not been sufficient to slow the inflow.
So I am worried about our adding $9 million additional to what the county has done, which has not been sufficient to slow the inflow.
And my belief, and it'd be nice to see some more testimony on this, is that we get more bang for our buck by preserving and enhancing the use of existing affordable housing.
I also want to say that I'm going to vote no on anything that only allocates the $20 million.
I think that Councilor Smith is doing the right way by looking at all $40 million at one time, and plus maybe this $10 million in CET money that I haven't focused on.
So I think that we should focus on the big picture rather than debate just $20 million.
Thank you.
Candace Avalos
Thank you.
Councilor Pirtle-Guiney.
Elana Pirtle-Guiney
Thank you, Councilor.
You know, I'm looking at this sheet that Councilor Green handed out, and I do think, Councilor Green, that you are looking at the right amount of money, the right buckets of money.
And as we have the conversation today, I hope that we're not focused on the $160 million.
$4.82 I think that we're focused on the $100 million.
Million.
$4.82 Million, but we're looking at the $20.7 and the $3.4, perhaps that $4.82.
I have some questions about that.
I don't think that means we need to spend all— what is that— $41.1 million.
And there is a conversation we have not had about whether we should be allocating that $30.4 or not.
If we're going to allocate some of that, I agree, Councilor Novick, we should do that We should have a pack— well, as we do the 20.7.
This is a work session.
We won't allocate anything today.
We should have a package that looks comprehensively at the needs in our community and what we are going to do with that.
Spending that— there's a lot of things on the list we've talked about, colleagues, that I'm really interested in us funding, projects that I think we need to get going.
Thank you.
Work on the mortgage buydowns that I think is critical.
And I recognize that every dollar we spend out of that $30.4 million pot is us saying to our bureau, we're turning your processes upside down.
Maybe we do that one time because there were these accounting variances that led to some different information.
And we say this is one time where we're willing to go in that direction.
I can be comfortable with that, but only if we're being clear about this choice that we're making to turn our normal funding processes on their heads.
I am wondering about the $4.8 million because the first that I had heard about us using those dollars was today, and I know we're talking more than debating, Councilor Avalos, but I'm wondering if I'm wondering if we can ask our administrative team who's still up here with us to talk about whether there are other projects that the $4.8 million were being considered for, not necessarily things they've been allocated to, but are there 2 or 3 things that that has been in the back of people's minds for that we should know about so we understand the trade-offs, or is that truly money that has no trade-offs at this point?
Candace Avalos
I think it's totally fine to ask those questions if you are prepared to respond.
Michael Bonacore
Yeah, I will have my team message me if I get this incorrect or if there's something I'm not aware of.
But I believe we represented those funds as we did because there really is not anything that we would otherwise recommend.
So there are often, you know, sort of opportunistic opportunities that happen.
Elana Pirtle-Guiney
There's the possibility of making that available through a solicitation, but there's not, They're not tied up in any conversations with PSU or any conversations with the Diamond Project or any conversations with any other speculative development that we're having with other folks?
Michael Bonacore
That's correct.
Mitch Green
Correct.
Elana Pirtle-Guiney
Okay, thank you.
That's really helpful.
You know, I know we're on the first question, but a couple of other people have talked about question number 2.
Candace Avalos
And feel free to go ahead and just talk through all the questions.
I don't want to— it sounds like we want it a little bit more fluid, so you can answer any of the questions.
Elana Pirtle-Guiney
Go ahead.
I just want to second the questions that Councilor Novick was asking about rent assistance.
When we have one-time dollars as an entity that is often tasked with providing infrastructure And does less, not none, but less on the service provision side.
And we have one-time dollars before us.
I am not excited about spending any one-time dollars on ongoing program needs.
They will leave us with a cliff down the road.
Olivia Clark
Second.
Elana Pirtle-Guiney
They will leave us with those budget holes that we are looking at right now down the road.
We will make promises to community organizations that are helping people day in and day out that we cannot fulfill a few years from now.
And while I understand the importance, the critical importance of rent assistance, I don't think it is the right use or best use for these dollars.
And I hope that we focus as much as we can on things that have long-term effects for one-time purchases like construction, constructing new infrastructure, like those mortgage buydowns that I think can be used for not only lowering rent but addressing the other issues that make units unrentable, some of the turnover and security issues as well.
I hope that that is a focus of our conversation.
Thank you, Councilor.
I'm sure I'll, I'll address more of the questions as we move through.
Candace Avalos
Sounds good.
Colleagues, without objection, Mayor Wilson would like to insert the discussion.
Is that all right?
Go ahead, Mayor.
Keith Wilson
Thank you, Chair.
Thank you, councilors, for this opportunity.
I'd like to make some recommendations for your consideration.
We're making these decisions that are all good.
There are no bad decisions here.
But they're being made underneath the umbrella of a fiscal crisis that our city is facing.
This afternoon, you're going to be presented with the spring TAL and the budget deficit that we have right now today.
It's about $18 million.
The first recommendation that I, I'd like you to consider is taking a portion of these funds and addressing the immediate concern that we have to reduce service impacts and employee reductions.
That's first.
The second, and only my second request other than a few comments, would be to also focus on rent assistance for those currently experiencing homelessness.
We've had a really good year and we've worked very hard to bring people from the street into shelter.
I hope you join me to work as equally as hard to help people from shelter into housing.
And what's good news is that we have available housing.
We have thousands of affordable housing units that are available Today, we can house individuals within 5 months versus building housing, which will take 5 years.
So I hope that you join me in that immediacy of using these funds and looking at that one particular line item and seeing if you can plus up if you see possible.
2 Other points I want to make regarding Williams and Russell.
The state just passed legislation yesterday to bring $10 million into Williams and Russell.
And so anytime we can share and add funds to get that project going.
That just allows us to move faster to build housing quick for those in need.
And then the last and final is Broadway Corridor.
While the government did not pass funding to partner on that, I had a conversation with the governor earlier today regarding Broadway Corridor.
It is one of her single most important priorities to do 2 things: build affordable housing and then take that space in our downtown core and get construction workers moving and getting that housing moving as fast as possible.
So I just wanted to convey that priority to you from her.
So thank you for this opportunity, Chair.
I appreciate it.
Candace Avalos
Sounds good.
Councilor Kanal.
Sameer Kanal
Thank you, Chair Avalos.
Um, so much good stuff in here, and I appreciate the conversation, and I appreciate the having something to react to.
So thank you to Councilor Green, and I think Councilor Morillo and teams for this.
I want to start by saying I think I agree on what the scope of the dollars are that we're looking at.
Not necessarily— I'm not as concerned about the idea of adjusting what was penciled in because of the fact that it was penciled by bureau staff.
But I do think that the ones that have specific projects are better left alone in this moment.
I'm not necessarily making a broader Understatement there.
So looking at the 58.1 as, as already committed is, is something I'm comfortable doing, um, with a couple questions I have around CET.
But I think, um, that's the part that I'm interested in is already in the 30.4, I believe.
So I'll verify that later and, and, and update.
But, um, as we get into what is good to look at, there are a few things here that I wanted to, to talk about.
Um, First, the thing that I think has been missing this whole time is activating our spaces through the use of some of the short-term rental dollars for in-house economic development on the tourism side.
I'm not talking about millions and millions of dollars.
I'm talking about helping events that are coming to Portland to be more successful, be larger, and help occupy more of those rental units, both in terms of Airbnb-type rentals and in terms of hotels downtown.
I think that's an investment in our future that will yield more money down the road.
I have been an event planner in Portland.
It is not always easy to do, and it's not always easy to scale here.
So I do think that that's a piece that's missing.
I'm not talking about tens of millions of dollars here, but I do think that that's a part of it.
And I think that's a good way to pivot into the general fund conversation because I think that's the mechanism, and I'm very comfortable with that.
Request from the mayor, given that we're looking at this larger group.
If we were just looking at the $20.7 million, I think there's a— the universe gets so small that it's harder to look at the general fund.
But I think if we are talking about the, the, uh, $54 or $55 million, $55.9 million, then I think it makes sense to look at the general fund as well.
Um, with relation to these tiers and what has been proposed, I'm a big supporter of rent Thank you.
On the rent/mortgage buydowns, I think a permanent 18% reduction is a really valuable thing to look at.
I believe that was the estimate we looked at for a couple hundred units there, and that would help us.
When we looked at the math for 60 to 120% AMI, I think it was yesterday, day before, there was a time where we were looking at tables and just seeing how big of a difference that is Yes.
In the affordability and how, how frankly some of what we consider affordable housing is not only not different from the market in a substantial way, but not even affordable at all.
I think it really drew attention to that.
Big supporter of eviction defense.
I agree with the mayor about the rental assistance piece for those trying to get from shelter into housing.
I'd also like to look at the original purpose that Councilor Avalos has been beating the drum on this whole time, which is slowing the inflow.
It is, I would put preventing someone from becoming houseless always as the highest priority there, followed by what the mayor requested of trying to get someone who is currently in shelter into housing.
The piece I wanted to talk about here from this Tier 2, the social housing acquisition, I'm very, very, very supportive of.
I'm actually okay with the $4.8 million going to to Broadway corridor given the TIF River District restriction.
I am surprised to be saying that as much as anybody else might be hearing me say that, uh, just because of that restriction.
Um, but given that it already has $5 million, I think $9.8 million is, is more than enough for one thing.
And I would like to see that other $800,000 be looked at for some of the other priorities we talked about, including that tourism piece.
Dan Ryan
And I'll leave it there.
Candace Avalos
Okay, thank you.
So what I'm going to do, um, I'm going to keep going with first rounds if that's okay.
So Councilor Green, I'll come back to you.
We'll do Councilor Koyama Lane, Councilor Murillo, and then I'll do the second round with, um, Novick— or Green and Novick— and then I'll open up the next 2 questions when we go there.
Councilor Koyama Lane.
Tiffany Koyama Lane
Thank you, Chair.
Um, thank you for this work.
The teams of Councilor— Councilors Green and Murillo.
I am wondering if it's— since we're all kind of looking at this and I don't think members of the public get to see it, can it be something that is put up as a—.
Elana Pirtle-Guiney
Great.
Tiffany Koyama Lane
Meeting materials.
Great.
I have heard in different conversations in community that some different explanations of rent buydown, and so for me, I think it would be I don't know if it's you all or even if Councilor Green, you want to clarify.
I'm hearing folks talk about using the funds to lower rents going forward so you can do some sort of restructuring of debt.
And then I've also heard it being talked about as for some of the affordable housing providers that are kind of underwater, helping them out with their debt, which might not lower rents.
Yeah, so I think that's a great question.
And so if someone wants to clarify, that would be helpful.
Mitch Green
Yeah, go ahead, Michael.
Michael Bonacore
Sure, sure.
Councilor, as I've said, rent buydowns as a strategy is something newer for the Housing Bureau.
We've described a couple of recent specific projects that were in the development pipeline.
And so we had the opportunity to restructure debt and get those buydowns before the property went into operation.
And when something is in development and in that state, it's a little bit easier to sort of do that restructuring.
It is possible to do once a building is in operation.
And I think you get to the question of, are you simply buying down debt to help stabilize operations versus buydowns, is a question of how much you're investing, essentially.
And so we've got definitely a lot of providers who need— who would need debt buydown, who would benefit from debt buydowns To sort of stabilize the financial performance of their portfolio.
And could also, you know, tenants could benefit from rent buydowns.
And the reason there's not sort of a comprehensive answer for this is 'cause we haven't really had a full strategy developed and we haven't had sort of like a big pot of money where we could make this available.
So we're relatively young in our experience of making it work.
And there are, I'm sure, Yeah.
Approaches that we haven't even, you know, we haven't tried yet, but that exist out there.
Tiffany Koyama Lane
Okay, thank you.
Thanks for explaining that.
We might want to get clear on that.
I think for me in supporting that, I would— I want to see like rents going forward being able to be lower to be part of that.
Did you want to add on to what you were thinking, Councilor Green, and explain?
Mitch Green
I'll just wait until I come back around and then— Just know that I'm gonna respond to that point too.
Tiffany Koyama Lane
Okay, great.
And I know that we're still working all this out, but if we were to be talking about more of the short-term stabilization, giving bridges of rent assistance, is that something we can do in-house?
We would be doing it as the Bureau, or is it something we'd be contracting out to others to help us do?
Michael Bonacore
There are approaches to eviction prevention and eviction legal defense that exist in-house.
And so we could, we could do that as long as council didn't sort of prescribe something that was outside the scope of what we're already doing.
And I will just offer as well, Councilor, on that, on that last question that I said that there's sort of a universe of possibilities for rent buydown.
But if you all sort of appropriate this money and say, you know, we, we want this to go towards this specific thing, like, we can, we can make that happen.
Tiffany Koyama Lane
And does it need to be— you were saying it needs to be a certain amount of money too?
So it has to be a— depends how large the chunk is for you?
Michael Bonacore
Yeah, and that's really a question from project to project.
I mean, if we're looking at a number in the $8 to $9 million range, I would anticipate we could probably do 2 or 3 projects and get maybe in the realm of 150 units.
Loretta Smith
Great.
Tiffany Koyama Lane
Okay, thank you.
Michael Bonacore
But that's very soft math.
Tiffany Koyama Lane
Yeah, and then I just want to point out that we are talking about $40-ish million, which is a lot.
And, um, you know, it's seeming like we don't actually— we don't have to choose between one-time rent assistance and helping affordable housing providers.
Um, it sounds like we can be able to possibly do both, which is great.
And, um, at first glance, and what I'm hearing a lot from constituents, is I am going to be making sure legal services are part of the package that I support, and keeping tenants housed, and also getting people into housing too.
Loretta Smith
Okay, thanks.
Candace Avalos
Thank you.
Councilor Morillo.
Angelita Morillo
Um, you know, I put my hand down because I honestly think Councilor Green and I are saying the same thing, and in the spirit of us leaving at some point, I will just not repeat people's Sounds good.
Candace Avalos
Well then, with that, why don't I just open up the next 2 questions just so the public knows what we're responding to, and then we'll keep the conversation going.
So the next 2 are to talk about these 2 particular buckets around rental eviction prevention, all of that, and development projects.
So question 2 is about— the question is, which of these programs would you prioritize retaining at their current level Are there any programs that councilors believe should be scaled up, either because of demand, impact, or urgency?
And are there any modifications or new investments related to rental services that councilors would like to raise for consideration?
And then the second question is, which of the development projects currently identified would you prioritize retaining?
Are there projects or development strategies that councilors believe should be scaled up or expanded?
And are there new ideas or approaches related to housing development that councilors would like the group to consider?
So go ahead and pop in the queue if you'd like to talk to those questions, but we'll kick it off with Councilor Green.
Mitch Green
Thank you, Councilor Avalos.
And conveniently, my response to Novick is right on in the spirit of the question.
So I think you're posing the right question, Councilor, that we need to start to test these trade-offs here.
Rent assistance on the one hand and these other kind of more maybe perhaps long-term sorts of interventions.
But I But I must— I do have to say that we don't have to make a binary choice.
I think what we need to do is we need to figure out what is the right blend here, because again, rent assistance is a demand-side intervention that works alongside those other supply-side interventions.
This is what we get from the practitioners with experience in this space.
You can help keep someone stabilized with rent assistance.
Not everyone is in an affordable housing unit.
And so let's have the discussion.
But I wouldn't— would not support sort of zeroing out of a kind of rent assistance bucket.
To the mayor's proposals, I appreciate you laying those on the table.
Helps me see where you're thinking, and it's very close to how I'm thinking.
So when we drafted this, I took a step back and got up to a higher level of resolution when we think about rental assistance.
Candace Avalos
Thank you.
Mitch Green
Let's just, let's just have a bucket for rental assistance and let's give direction when we allocate this to say it should be in line with the priorities of folks we're trying to serve right now.
I think that we should make rental assistance available for folks who are unhoused who need to get into housing.
I think that's critical.
That's crucial.
We can adjust how we use that and who's the right recipient based upon how the conditions change, I think.
Donnie Oliveira
Thank you.
Mitch Green
I want to respond to Councilor Pirtle-Guiney.
Um, you know, earlier on you had sort of raised up the bigger philosophical question of we need to determine whether or not we're going to ask the Bureau to change their existing NOFA plans and whether we think that's appropriate.
I, I'll just make the case that I think it is appropriate just because while I understand the need to smooth out your resources over time, so that's There's something there 2, 3 years in the road, down the road.
That's a sort of like planning practice in the absence of shocks and sort of emergent conditions that you don't necessarily know about ahead of time.
I think we're in one of those crisis shocks where we have, we have opportunities to seize on investments right now that are probably going to be lower cost than a few years down the road.
And so we might be to stitch together some solutions that get some things in the pipeline or convert— you know, I had a conversation recently with the folks who are involved in the co-op discussion space.
They're well organized.
They're ready to turn apartments into co-ops.
They just don't have capital.
So we could enter in this space under the broad banner of social housing and say one of the first things we could do is provide renters an opportunity to now have an equity stake in their building.
That's something we can do right Right now.
And so, you know, that's kind of— that's— so I'm making the case, I guess, for us to think about intervening on those plans.
And then finally, Councilor Koyama Lane, I had started this conversation, was inspired by the rent buydown presentation at the Finance Committee, I think on the 12th of January, started on the rent buydown implementation of mortgage buydowns.
But then I had broader conversations.
I met with REACH They made the case that there's actually— the challenges facing these providers are different depending upon the building, depending upon the institution.
And so some flexibility might be desired.
We could have a prioritization schedule.
I'm going to share— I'll forward you an email that I got from Madison Moskowitz who said let's look to Seattle.
Actually, Seattle has a program like this.
They have an intake form where you fill out Kind of what your purpose for the request for funds would be.
And that could be a way for the bureau to develop a program around this and engage in a prioritization process.
So I thought that was interesting to share a best practice or an existing practice from Seattle and just kind of lay that on the table there.
So I'm not dogmatic, I guess what I'm saying, about how to use this category of debt buydown.
I just want to use it, frankly.
I would like it to be for rents lowered, though.
And that's how— if, like, if I was advocating for something, I'd want to see it for rents lowered.
Michael Bonacore
It Thank you.
Mitch Green
To be like the priority.
Like, we can have scoring matrices.
We have that on our grant making all the time.
So I'll leave it there.
Candace Avalos
Thank you.
Councilor Novick.
Steve Novick
Madam Chair, if you'll forgive me, I want to clarify a couple of things that might not be directly responsive to these couple of questions.
Okay, so first of all, Councilor Pirtle-Guiney, I hear what you're saying about we don't have to allocate the second— the $30 million pot now.
My concern is that, for example, I mean, I like Councilor Green's idea of spending $8.5 million of the $20 million on rent buydowns, et cetera.
But I worry that if we do that, people might think of that as a ceiling rather than a floor.
And the assumption might be that we don't use any of the $30 million for that.
And I'd actually probably like to see the number higher.
So that's my hesitation.
Sameer Kanal
Okay.
Steve Novick
And let's see, I— but sort of along the same lines, I am not— I actually rather like Councilor Green's and Councilor Murillo's proposal.
I might sort of want to tweak it and say let's maybe have more flexibility for more affordable housing buydowns versus social housing, but I sort of like the mix of Long-term versus short-term in it.
One, so I mean, again, by saying that I don't want to vote on Councilor Green's initial $20 million proposal, that doesn't mean that it's an objection to the proposal overall.
The other thing I wanted to say though, in terms of urgency, is that if we're going to get money for the general fund, then my understanding is that has to come out of part of the second bucket, which is the short-term rental 2% part.
Jamie Dunphy
Yes.
Steve Novick
So if we don't, uh, I feel some urgency to say we're going to spend a chunk of that money on the general fund, which is another reason I'm not totally comfortable with the idea of saying we'll just vote on the $20 million and not vote on anything else.
Candace Avalos
Thank you.
Council President.
Jamie Dunphy
Thank you.
Um, I have 2 additional sort of points to this, and, and it's not I'm not— so for—.
Michael Bonacore
Okay.
Jamie Dunphy
I don't believe that we should be spending money supporting units above 60% AMI broadly.
I think that it's, you know, been stated over and over again that roughly right now, 60% AMI unit is market rent.
I think we need to be a little tighter about this.
I understand that there are some federal requirements around LIHTC and things like that.
But I think broadly, philosophically, this— that public dollars in the housing market should only be used to fill spaces where the private market won't meet.
They're not building 30% units.
They're not building 40% units.
And that is the only reason why I think we should be investing in housing broadly.
The other sort of philosophical point that I'm— I guess I don't know if we can— I don't know if this is a policy thing or something to discuss now, but something that Councilor Green started to touch on, which is that right now we are largely a pass-through organization.
That when we are investing in housing, we take public dollars and we cut a check and we put it out into the public, but we don't have anything 10 years later.
We don't own any assets.
We don't have that continued ownership stake.
I don't know if this is a thing, but if we are going to buy down rents, if we're going to buy down the mortgages, is there an opportunity for us to have an ongoing ownership stake or an ongoing asset for the city to be able to claim and also insure over the long term, I guess?
Steve Novick
Yes.
Jamie Dunphy
Yeah.
We don't do great over long-term maintenance and things like that.
But I'm just thinking more broadly, like if we have one-time dollars and we're talking about maximizing the impact of those one-time dollars, I just worry that if we just cut a check, then that is the end of it.
And I don't know how to, I mean, like ultimately social housing is, that is a core tenet of what we're trying to think about.
Maintaining a public asset as a values proposition.
But those are sort of like the— those 2 points that like, how affordable is affordable and what does the city have after we are done are things that I'm just really continue to be concerned about broadly about our housing policy.
But also if there's ways that we can reflect any of that in how we are doing this or if this is an opportunity for us to think about that.
Dan Ryan
Thank you.
Jamie Dunphy
Us to start pivoting.
I think there's a real— I think those are really important considerations.
Michael Bonacore
Thank you.
Candace Avalos
All right, so we're at 12:03.
We go until 12:30.
And I was about to say, I haven't heard from Smith, Zimmerman, Ryan.
Great, get in there.
Clark.
So I'd love to start seeing you in the queue.
Councilor Kanal, I think, did you take yourself out to go after?
Okay, so go ahead, Councilor Smith.
Loretta Smith
Thank you, thank you, Madam Chair.
I agree with everyone.
I think we need to spend some of those dollars on, uh, rent assistance.
Um, I also believe the 2% money that we have the $8.6 million in, in my proposal, it, it gives $5 million back to the general fund.
I think that's going to be very important.
And I also think that we need to support some of those, um, projects that need this last gap funding, like Williams and Russell, Broadway Corridor, and Self-Enhancement Homeownership Program.
That's going to be great.
I just want to address something that the council president said about having assets.
I'm all about having assets.
I think that's important.
But with assets, just like the assets we currently have in our public works system, they require ongoing maintenance and ongoing money.
Candace Avalos
Yes.
Loretta Smith
So as we're talking about buying these assets, if we're not putting in the budget long-term maintenance for ongoing dollars, that comes with the cost.
It's not a one and done.
So, and if we're not planning to sell that asset, we don't really get a lot out of it.
We're going to be putting more money into it.
So that's why I really like the idea of helping the community-based developers.
We help them with their gap funding.
They do it.
We don't have to maintain it.
Adrian Delgado
Councilor Smith.
Candace Avalos
Yes.
Loretta Smith
But if we do buy the social housing thing, we are going to have to maintain it.
So that's going to be another bucket.
And then we're going to have to figure out how do we maintain it and what do we take out of our current budget.
And that's the other issue.
The last thing that I'm concerned about, and we'll talk about this later, is the realignment process for the city.
They're being asked for 3%, 10%, I think 20%.
I'm not We're not sure what's going to become of that realignment.
So not knowing that and seeing what we have forward, I think we need to quickly support these projects that Green put out and get that done right now for '25-'26.
The other question that I have, Michael, I know we've talked before about the rental assistance, and at this late date now, we talked about it in December and January.
Elana Pirtle-Guiney
Yes.
Loretta Smith
Yes.
If we do the rent assistance, it's going to take until after July 1st.
One of the proposals that I had put forward was to identify community-based organizations like the Sun School groups who do rental assistance to actually appropriate that to them so they can get it out on the floor before July 1st.
So is your sense still that if we kept the rental assistance and kept it in the Portland Housing Bureau, that we will not be able to get it out until after June 30th?
Michael Bonacore
I think for potentially for something like a new program, like eviction legal defense, which we don't currently do, that will take longer.
Loretta Smith
Not that the rental assistance, the actual to help people who are being evicted that are in their homes and we want to keep them there.
We had talked about that it would take a long time for you to put out an RFP for that, and it probably wouldn't happen until after the first of the year.
I'm saying we have existing programs that we work with, with Multnomah County and with the Sun School programs.
They are doing— they've all run out of their rental assistance money.
And I've talked to a few of them, and they can put those dollars on the street fairly quickly in the realm of $250,000 to $300,000.
Elana Pirtle-Guiney
Okay.
Loretta Smith
So I'm saying if we did pass a rental assistance bucket and we sent it back to PHB, would you be able to get it out before June 30th?
Michael Bonacore
If what, um, if what gets passed aligns with work that we're already doing and we can increase contracts, then we can get that money out.
If it's something new that we're not doing or we need to have a different scope, then it would take longer.
Loretta Smith
So, and we're not doing that because we're not in the business of rental assistance right now.
We would have to do an RFP.
We have old programs that we did during ARPA that we would have to, to, um, we, we'd have to activate those folks, and that would be a process.
Michael Bonacore
If we were running a rent assistance program that we don't currently exist, that's right.
Loretta Smith
Yeah, so that's why I was suggesting to directly appropriate these funds to programs are currently doing it, they got reduced on the state level and they can get those funds out before June 30th.
If not, I mean, what's the purpose of us identifying rental assistance?
And the monies that we don't do here, that it can roll over, but I think there's a certain amount of this money that needs to get out of the door before June 30th.
Michael Bonacore
So I, again, I don't have a lot of experience and the city doesn't have a relationship with SunSchool, so I believe I believe the mechanism here would be an intergovernmental agreement between the city and the county to move that money through their system.
Tiffany Koyama Lane
Right.
Loretta Smith
But they would get it directly.
It wouldn't come through PHB.
It would come from PHB, but it, it wouldn't be that they would actually be able to actually do this right now, right?
Michael Bonacore
I believe once we did an IGA, if the county system can accommodate that, then yes.
Loretta Smith
Yeah.
And they can do it directly.
We don't have to give it to the county.
We can give it directly to the SUN school systems who are already doing Thank you.
Some of those programs are already in our system, like Latino Network, ERCO, Multnomah Metropolitan Housing and Family Services.
And then we also have Self-Enhancement, who also is a SUN School provider that provides for rent assistance in every district in the city of Portland.
And, and, and that's the only reason why I didn't think about doing it with PHB was because of the conversation that we had.
The second piece is that if we do carry over money, if there are dollars that we carry over, would you actually RFP those dollars?
Because we're not going to do this after— this is one time only, and I've been telling people this is one time only money.
This is not our book of business.
Would you also have to RFP those dollars after July 1st, those funds that we don't use before the 30th?
Michael Bonacore
If there's, if there's money that we move out before June— before July 1st, we won't have to do something after July 1st.
Loretta Smith
Okay, but I think in the slow the flow, we put money in for this fiscal year and next fiscal And so I'm just trying to figure out how we do that and what adjustments we, we make in amendments.
Donnie Oliveira
Councilor, may I hop in for maybe just to help sort this out?
In the Slow the Flow proposal, there was money, you know, forecasted in multiple years.
Each year, those, those resources would have to be budgeted in our budgeting process, even though they were committed to the program.
For the bureau to spend the dollars, they would still, through a budget action, have to be authorized to be spent, right?
So in that case, we would do that.
In the event that money was not spent, we would use the fall TAO to true up the dollars to be carried, carried forward, right?
Loretta Smith
So that would be good.
Donnie Oliveira
There would always be an action.
Candace Avalos
Yeah.
Loretta Smith
And so the purpose would be to put all the money for rent assistance in '25-'26 so that it can roll over and we don't have to reauthorize it.
Mitch Green
Perhaps.
Donnie Oliveira
I think that's— I think that we'd want to let the Bureau staff provide their their best, you know, best guess of implementation for, you know, practicality.
Loretta Smith
Well, thank you.
Thank you.
Candace Avalos
Okay, Councilor Zimmerman.
Eric Zimmerman
Thanks.
Um, I think most everybody knows I'm probably in the camp of creating more units is, is my number one priority.
Um, and so I think that I think this mix that's being discussed is generally, I understand it, supportive.
There's something I want to tap into a little bit though with your comments, Council President, about what level of AMI we should be investing in.
Because I think those are really salient points and they're easy to track.
And here's the other part of that conversation.
When we talk about So I'm a believer that mixed-income buildings and mixed-income neighborhoods are the healthiest type, right?
Like, that's where I come from.
The Pearl District is one of those where lots of affordable, lots of middle, and certainly some luxury balance has brought that community into a densely populated sector of our city.
And if we believe that density is the future for urban planning, which I'm one of those people, We're in a situation right now where, you know, in Northwest Portland, if you get into the numbers of Northwest with the alphabet, it's going— those are filled, those buildings are filled with what would and should be naturally affordable units.
But because our capacity is so stretched in our community, we have people who make perfectly healthy salaries who are, I I guess renting or buying downs in, in a way, because that's what's available at a high level, right?
That, that what I would say is they should be competing with other units, but because they're not, those owners of those, you know, 4-brick— and I'm talking the old ones, right?
And a lot of us as young people lived in them at different times.
Those are now getting a rate that I would say has put us out of balance.
Steve Novick
And so—.
Eric Zimmerman
That balance matters because if you think about Broadway Corridor, which is an extension of the Pearl District, it will be the next, I hope, mixed-income, densely populated, uh, mixed building income as well.
That is where, at least in that district, where rents are higher than they are in other parts of the city.
I think that there can be an argument in limited Very limited use.
Very limited use that we want to incentivize that some AMI, not a certain percentage of it, but just some average folks, middle incomes, are able to be there as well.
What I think will happen in the Broadway corridor if we don't look at at least a little bit, and it's— we're talking one building, is that we'll have one highly subsidized unit, highly, like the lowest AMI, and then We hope on, on, on a, you know, a whisper, if you will.
We hope that others will eventually pencil in projects, but those will pencil in fully at market, and we will leave out essentially families, uh, below the $150,000.
Or I think even if we're really talking about 2-bedroom areas, we're really leaving out families in large numbers that would fall into the middle class for families.
So if we make those choices of, of not putting a little bit of money to make sure that we have some, some restricted units in certain buildings available at what is right now— it's, it's terrible that we have to talk about it, but we have to incentivize middle-income units to be built in parts of this city.
And that's where I would just ask that you be open to Sometimes there's— if we want to create a mixed-income development, and I think that we do in Broadway Corridor as a planned community, that it might take us incentivizing some of that.
So I just, I offer that as a challenge because at the same time, I think it's responsible that we make an estimate that if the market is not going to develop, because that was your words, if the market is not building, well, right now— It's not.
The market in the downtown areas is not building apartments that can be afforded by the by the a middle income person or family.
It's not unusual in District Four to have a three thousand dollar rent for a rental apartment in Slabtown, and and that is that is a challenging number for a lot of income levels.
So I offer it because I think we're a council, and I think we're a city whose urban planning.
I think we're a city whose urban planning believes in mixed income, and there will be some places that that's going to be more expensive to incentivize.
But we can make that choice.
It's just that it may take longer to incent— it may take longer for it to come to fruition if it's not incentivized.
Or we may create a canyon.
Market rate, high dollar, and the most subsidized, very low dollar.
I think that's what we're doing.
And I don't know that that's the healthiest community that can be built in different sectors of our city.
So I offer that up in limited scope.
I think that we have to consider the zip code in which we're trying to incentivize development.
In terms of the Housing Bureau's production, right, I am in large favor of helping in concept, the idea of helping restructure a mortgage for an affordable housing building to allow them to reduce their rents.
What I think would be helpful is why we, collective we, allow a system to exist where you were subsidized to build it, you bring the rent in, and it should be to maintain it, pay the mortgage, and hopefully put some staff around it.
The continual bailout is a concern for me because most everybody who can't get A renter at a certain dollar amount, they lower their rent so that they don't go 6 months with a vacancy.
And so I'm having a tough time swallowing the 6-month Home Forward pill right now, because if we do this bailout, it is, it is to a group who has 6-month vacancies.
And for, I think, a general person in the public, we go, excuse me, like, lower the damn rent.
Donnie Oliveira
Yeah.
Eric Zimmerman
If you can't get a renter.
So what are those structural things?
Can we articulate some of those structural things?
And it has been said in some circles that the way some of these organizations stay afloat is by floating the next construction project.
That's how they keep their staff on board.
So before we commit to buying down their mortgages, can we, can we get an understanding that the system actually isn't rotten to its core?
Councilor Dan Ryan.
Because if, if I have a $100 million asset, a building, and I subsidize the rent because y'all, the government, helped me subsidize the building of that, or the, the construction of that building, my expenses month in and month out should be the note, should be building maintenance, right?
Mitch Green
Yeah.
Eric Zimmerman
In an ownership model, we'd call that the HOA, but in a rental model.
So what is the rent going to?
Because as much as I want to get down with the mortgage adjustment stuff, I need to understand why they didn't do what everybody else would've done, which was lower the damn rent.
Like, what's going on with that system?
Michael Bonacore
Sure, I'll do my best, Councilor.
So, you know, I think, I think when we think about the collective we, the collective we as funding jurisdictions, federal government, have historically required underwriting criteria that are very tight.
It's understood that in a number of years, those projects will be underwater, and that's happening now faster.
So I think one of the, One of the critical things for us and for our jurisdictional funding partners is to revisit how we're doing the underwriting and building in things like, you know, expectations around security systems and understanding that operating expenses have escalated in a way, particularly with populations who are experiencing acute behavioral challenges.
Adrian Delgado
Thank you.
Michael Bonacore
Health issues that the game has fundamentally changed.
And so we have to change our game because if we continue to do it the way we have, we're setting folks up to fail and then telling them that they have— that they've failed.
So I think, you know, there's a—.
Eric Zimmerman
Before you go on, Michael, can I ask just a clarifying question with that?
'Cause that's very helpful.
So let's say, You know, Zimmerman CDC built a building, right?
And 15 years ago, it was essentially, you know, it was affordable, it was restricted, but today I have a security concern, so I've got to have a staff on for that.
I have a behavioral health acute— acuity issue, so now I've— I'm bringing in maybe case managers or social workers.
And what you're saying is that because that need is there, that the housing The, the organization, the nonprofit, is actually buying that instead of Multnomah County placing that service in that building?
Is that what is— when you say building expenses have gone up?
Michael Bonacore
Yes.
Eric Zimmerman
Okay, so our social services agency, Multnomah County, is not saying, oh, we have a concentration of an acuity at this building, we're going to place a behavioral health specialist in the building.
Now it's just on the backs of those CDCs.
I would be hiring my own.
Is that kind of what we're talking about when we say that?
Michael Bonacore
There are definitely a lot of unfunded, unsupported supports and expenses that the providers are bearing themselves.
Eric Zimmerman
And I have heard from a number that they are, Forced may be as strong as a word we can go to, but they are having conversations about what type of client they can and cannot take on, and they are feeling like they've really got to lay that out now because they're not equipped— is the language that's been used with me— not equipped to take certain types of clients, and that, that has not bode well for them, I guess, in terms of how either the county or Home Forward Treats them, works with them, places them.
Okay, sorry I interrupted you.
Adrian Delgado
Yeah.
Michael Bonacore
No, no, I've heard that.
I've heard providers express that as well.
Eric Zimmerman
Okay, so if we, if an affordable housing program A subsidized affordable building has vacancies and they can't get— they can't just lower— because I guess I'll put it this way, right?
I've got a mortgage due every, every month and it's, it's a certain number.
And a lot of people have been in this position, which is, yeah, most months I can make the whole mortgage.
On some months, maybe I'm only making a portion of it.
But the opposite— so maybe, you know, you come in at that Point, but to take no rent is what I think people are not understanding.
So why has the choice been not to take any rent on those vacancies instead of just taking less than you had hoped to take from a business decision-making?
What is that math that goes on at an affordable project?
Michael Bonacore
I'm conscious that the Director of Housing Oregon is in the audience listening to my answer.
Jamie Dunphy
Awesome.
Michael Bonacore
You know, I think there's that issue of, you know, structurally, how are you setting yourself up to pay your bills?
And so I know that folks are considering, you know, things like rent reduction.
I think what's often lost is that the literal vacancies are also paired with economic vacancies.
So they have also a lot of apartments that are filled with folks who are not able to pay their rent.
And so Just the combination of these expenses, uh, and, and lack of revenue stacking up against each other just creates a really bad circumstance.
Eric Zimmerman
So that's a very helpful answer.
It makes me wonder why the CDCs don't fill the units and then come instead of saying we need help readjusting, why don't they come and say, hey, we're not going to make our note this month to Home Forward, to the city, to the County instead while those units remain filled, because I think it has been very difficult to be an advocate for helping a system who made choices to keep things vacant.
But if they said all of our units are filled but we're not going to make our note this year and that's going to cost a certain number, I think that seems like, okay, let's rally.
I almost feel like we're in an upside-down world In terms of the— I don't know if it's chicken and egg conversation, but that's concerning.
The vacancy has been the concerning umbrella since this money started getting discussed, but then you throw these HomeForward articles that have been coming out and they're very troubling.
And so to this question of helping them out, that's where I go, is, is this system to its core rotten?
Because I I have said multiple times on the record that I am somewhat in favor of an asset approach to this, which is I know how much it costs to maintain a building from one year to the next.
That's a fairly common industry that exists.
We could just do that instead of this strange system.
I, I'm having a tough time wanting to put more money at that system, and yet it's the system we have right now to develop So I'm struggling there a little bit.
Um, thank you for helping put some light on some of those questions.
I appreciate it.
Michael Bonacore
Anytime.
Candace Avalos
Thank you.
Um, I will flag for the group that one, we are going to have a very robust discussion about this last topic in the Housing Committee soon.
Um, we just couldn't make it happen before the committees changed over, but that will be planned in April.
Um, timing-wise, I have been given the green light to extend us till 12:45.
There are a couple people here who have not spoken yet, so I'm going to get to them first.
Let's try to wrap it up by 12:45.
So, Councilor Ryan.
Dan Ryan
Okay, thank you, Councilor Avalos.
Content setting real quick, just remember that local governments received boatloads of one-time money from both Trump 1 and Biden ARPA, and we continue to be kind of haunted by that, not just in the Housing Bureau but throughout the city.
There's project work that was done.
We knew there was a cliff.
Providers were aware that this would be a cliff, and we keep moving the ball down the field.
And so I'm in the camp of when are we going to say that we're not in the business of doing housing vouchers and rent vouchers?
And so I'll just end with that.
I'm trying to be brief because of time.
And you know, when we met as a Housing Committee, Chair Avalos, we had a presentation about the system from streets to stability.
We went all the way to homeownership.
And the tone of that meeting was that rent assistance was the county's rules, not ours.
Building infrastructure was more in our vein.
And so I'm in the camp of build, build, build.
North, northeast, yes, I said the Broadway corridor, et cetera.
So I appreciate my colleagues that have proposals like that.
I will say I think legal assistance is more bang for the buck at this moment to keeping people stabilized in their homes.
I like that.
I want to talk about a systemic solution to rental buydown, which has come up several times when I would speak with the legislative priorities of the city.
There's a big gap between 30% and 60% AMI.
We all know that 45% is more of a sweet spot for workforce housing, and I hope someday that that becomes a thing and that we can see that.
Until then, I could live with the rental buydown.
But if you look at the data, It's around 45% for workforce, and that's been needed.
It's been talked about.
For some reason, Salem and in Washington, we haven't moved the needle on that.
Mr. Mayor, shelter services are fine if the participants are seen, served, and assisted to permanent housing, prioritizing those seeking recovery and engaging with the workforce.
As such, supporting organizations like, say, Ground Score that connect the dots to the workforce and building their agency to thrive in the long term.
And I don't understand why Portland Street Response can't help transport participants from shelters in the overnight when they close too early, but they close, to day shelters.
I hope to see that.
It's really hard to read the stories about people suffering trying to get from the overnight shelter to the day shelters.
Finally, there's a growing concern that's come up that we can't ignore, and that is, as mentioned, but I'm just going to underscore it, the Vacancy rates due to slow turnaround, which we all agree is unacceptable.
The turnover time is very unacceptable.
And the other, safety.
The stories from elders on fixed income who don't feel safe in their own hallway has to be the responsibility of the city with the providers.
And I know I have been asking for this to be on the agenda.
We've had emails about this exchange.
I was disappointed that we haven't added on the agenda yet.
Jamie Dunphy
Chair Avalos.
Dan Ryan
And I'm happy to hear that you're going to get it on there, but I do believe we're denying that and we're delaying that too long.
Just last night, I had 2 people in the audience when we had our forum come up to me and mention that they don't feel safe in their affordable housing units.
It's hard to sleep at night when you keep hearing those stories.
So let's just be better.
Let's just do a better job taking care of the affordable housing that exists in our market as soon as possible, and we can get more units back to sell.
Sameer Kanal
Thank you.
Dan Ryan
So those are just some of my big picture ways of thinking as I make decisions.
Thank you, colleagues, for the proposals you've put out there.
And I wanted to daylight where my thinking is at this time.
Candace Avalos
Yes, thank you, Councilor Ryan.
And just to be clear, you sent me a request and I said that I was gonna put it in the agenda.
I can't make a request happen within a couple of weeks, especially when I have other people coming in.
So I was not ignoring your request.
We are working on it.
We just couldn't make it happen on the timeline you wanted.
Dan Ryan
I understand, but it was weeks ago.
Tiffany Koyama Lane
Right.
Candace Avalos
And I have my committee agendas planned out for several weeks.
So just like any other agenda, you can't just do it the next week just because you want to.
Dan Ryan
I understand.
I just think it's an urgent issue.
Candace Avalos
I agree.
I just would appreciate a little bit of grace of scheduling like we tend to give everybody else.
So please do not persecute me for not doing something that I'm clearly doing.
Councilor Clark.
Olivia Clark
Thank you, Councilor Avalos.
And I'm really glad to hear that you This conversation will continue in your committee.
That was one of my questions, that you will continue the conversation.
Adrian Delgado
Yes.
Olivia Clark
Colleagues, I am not— I haven't firmly made up my mind about anything, but I can tell you what some of my priorities are.
I've been trying to balance the sort of clear and present danger or the immediate dangers that we confront with future investments and ongoing needs for affordable housing.
So under that clear and present danger, I would put the general fund.
I mean, that's a high priority for me.
I'm very, very concerned about what we're going to be dealing with in the next budget cycle.
Mr. Mayor, I may disagree with you on the no bad decisions.
I'm concerned about what you've heard some of my colleagues say about the vacancy rates, the bailouts.
I'm very concerned about where we invest dollars.
And I've also floated the idea of, do we have too many nonprofits in Portland?
I think we have too many nonprofits.
Do we have too many providers?
Should we be looking at consolidating, um, some of these CDCs or some of these organizations?
Because I think of all the admin costs that are— that they're incurring.
Um, but I am concerned that there, there might be some, might be some bad decisions and some other, uh, lenses that we should apply.
I am very interested in the Broadway corridor because I see it as a game changer for the downtown.
And I know I beat this drum a lot, But the downtown is our economic engine for the entire city, and it's going to link neighborhoods.
It's going to have different levels of housing.
It's a game changer.
So I'm definitely interested in investing in that project and some of the other development projects I'm interested in.
I don't have any questions.
I'll just leave it there and look forward to the outcome of your discussion in the Housing Committee.
Thank you.
Loretta Smith
Thank you.
Candace Avalos
All right, so now we're going to back to, uh, Councilor Kanal, Councilor Pirtle-Guiney, and we're going to close it out with Councilor Green.
Sameer Kanal
Thank you, Madam Chair.
Um, quick round of what I've agreed with that I really wanted to bring up again.
Uh, agreeing with Councilor Koyama Lane on eviction representation being a core priority.
I know Councilor Ryan mentioned that too.
I agree completely with Councilor Dunphy on ownership Yes.
You know, in the sports world, they do sell-ons in the contract, even just something at that later stage where you've— we've invested, and then if the property's transferred, we get a cut of the sale amount.
But I'd also like to talk about conditions associated with these sorts of projects, including vacancy rates being below a certain amount after a certain length of time, 6 months, under 5%, something like that kind of framing, as well as unit types.
Uh, density and, and type variation.
Um, we need to move away from studios and 1-bedrooms and start really forcing the conditions of our money being 2, 3, and 4-bedroom units.
Um, I agree with Councilor Pirtle-Guiney about not just rent buydowns but also the security upgrades as part of preservation.
I wanted to shout out the mayor's comment on Williams and Russell.
I forgot to do that the first time, but also, uh, Urban Plaza and SEI as well.
I was really grateful to see those in here.
And finally, the assessment of what Councilor Green was saying about shocks and emergent conditions changing our approach to some of our prior pencilings, I think is a really smart way of framing why some of these should change.
2 Slightly less rapid-fire here.
I want to start by saying I have a strong, strong disagreement about Portland Street Response being repurposed for something outside of its purpose.
Portland Street Response is not a homelessness response program.
It is a behavioral health Public safety, first responder.
However, I agree with Councilor Ryan that we do need to solve the day-night time gap transport issue with siting, with lobbying TriMet on transit for places like St. Johns where there just isn't connectivity, and hours extensions so that there isn't a time gap in the first place with no service being offered.
And then finally, I— and I'm building off of what Councilor Zimmerman said, and I agree with what he said— vacancies are a huge part of the problem.
They are the enemy.
They're They're much cheaper to fill a vacancy than it is to build a new place.
We know that Oregon statewide has over 6 to 1 as its ratio of vacant properties, residential properties, to homeless people.
That is from a couple years ago, the stat, but it's pretty well supported by data from around the country as well as earlier stats in Oregon.
I think, you know, we put up a vacancy, a vacant property fee.
I hope I hope that that is something we can do in time for it to be relevant to this year's budget conversation.
But also the conversation around Home Forward and its vacancy, which relates to everything that Councilor Pirtle-Guiney said and all of that, I think has to be its own topic that we— it's adjacent to, it's related to this, but we're not going to be able to solve a lot of our other problems in this space if we have a 14% vacancy rate at Home Forward.
Candace Avalos
Thank you.
Sameer Kanal
And I'm not blaming them.
I'm not saying it's their fault and they need to do better necessarily.
I want to understand the reasons for it.
And if that requires— some of these interventions are pretty basic, like key fob entry swiping when you enter the building so that there's some level of access control.
And we can solve that with this money because it's not actually that expensive and it is a one-time cost.
So I do really want to look at that.
And because if we are able to bring some of these buildings back to 100% filled, we are going to solve a lot of the, the other problems, or at least alleviate some of the symptoms of them.
Candace Avalos
Thanks.
Elana Pirtle-Guiney
Thank you, Councilor.
I want to just flag a couple of things that haven't been a major part of the conversation and speak to money that we may not spend.
The first is I've heard a couple of people refer to Councilor Smith's proposal, and for members of the public who are listening in, that's not on the grid before us.
That grid just includes proposals that spent the original $20.7 million.
There is another proposal that has been floating out there that is posted to some past meetings, I believe, that, that wasn't posted for today, that spends into that additional $30.4 million bucket, though not all of it, and includes some additional projects.
Michael Bonacore
Thank you.
Elana Pirtle-Guiney
As it relates to the projects, I— there's some really important projects on there.
The Urban Plaza funding will help us leverage a necessary conversation amongst the owner and tenant there.
And the Self Enhancement Inc. and Williams and Russell projects both include homeownership pieces.
We have not talked at all about homeownership today, but if Councilor Smith.
If we actually want to look at long-term guarantees that people will have more affordability, homeownership, a mortgage doesn't go up over time the way that rent does, and that has to be a part of our conversation if what we want to do is stabilize working families.
And those 2 projects involve homeownership opportunities for low-income families.
I think it is absolutely critical that if we decide Councilor Novick, I understand the confusion in what I said before.
I was agreeing with you that we should spend all money at the same time, but pointing out that we may not want to spend the whole $51.1 million, that there may be the $40 million proposal that Councilor Smith put forward that's a more appropriate level for us to spend.
I think that's a good point.
Us to spend at.
And to that note, I just want to flag a couple of things because I suspect that as we move through this conversation, we will say to the Housing Bureau, there's some of this money that maybe we are not allocating specifically.
And if we do that, colleagues, I hope that we do that and say, but Housing Bureau, we want you to get that money out the door as quickly as possible.
I don't want to leave dollars Going out in 2028 requests when we have a crisis right now.
I also hope that when we do that, we start to address who those dollars go to.
And I hope that at some point— it's not this conversation, but it is related to these dollars, so I'm going to say it now— we have a conversation about whether we should be giving money for new construction to nonprofits that have vacancy rates above Thank you.
A certain percent, because the only way that we start to bring down those vacancy rates is if we have some incentives for doing so, and we have millions of dollars of incentives.
Um, so I hope that as we transition from this conversation to what comes next, that that is something we are willing to talk about.
There's a lot of other things that were said that I agree with, but I wanted to just add those new things to the conversation while we had the opportunity.
Thank Thank you, Councilor.
Candace Avalos
Great.
Councilor Green.
Mitch Green
Thank you, Councilor Avalos, and thanks, colleagues.
I've said a lot today, but I really appreciate this fluid discussion.
Um, I got back in the queue because I, I wanted to respond to some of what Councilor Zimmerman was saying.
I think it's important that when we agree on something, that we, we raise it up and highlight it, because it's, um, it's important to, uh, to recognize our points of agreement I agree 100% that mixed-income neighborhoods are the model.
I think that is the future.
That's what I like about the potential of this Broadway project.
I just don't think AMIs are the way to do it.
I think you do it through cost-based rent.
I think you do it through things like limited equity co-ops.
But I think on the merits of the outcome, I think it's a great idea.
Olivia Clark
Thank you.
Mitch Green
Couldn't agree more on the mixed-income neighborhood concept.
That's what we learned in Vienna, by the way.
On homeownership, we have talked about that a couple times today, and I'll just say again, limited equity co-ops are a form of homeownership that provide the same sort of benefit mortgage does.
My mortgage goes up though because my taxes go up, so we just need to be clear on that.
And so if we think about I think that's a fair point.
When you think about social housing broadly defined to include limited equity co-ops, that is in the same universe of that permanency, of that sort of cost stability that you get from the traditional fee simple model of single-family homeownership.
And I just worry that if we focus on the old model in exclusion, I'm not suggesting anyone is, we're just not going to stretch our dollars as much because you can't provide that level of homeownership access to as many people if it's just $100,000 a shot or $200,000 a shot to a person versus underwriting their purchase of a building they already live in to now have equity in that.
So I just, I wanted to float that there.
That conversation should mature as we have these conversations.
But I just, I wanted to close by saying that we've talked a lot about the Portland Housing Bureau today, but I just want to say directly, the Portland Housing Bureau, you do excellent work.
Jonas Biery
Thank you.
Mitch Green
And I thank you so much, Michael, to you and your staff.
You know, it's got to— it has to have been difficult to think about what council has said over the last 6 months, what the public has said.
But I know I've met many of the soldiers in the trenches there, and they're in this work because they're pouring their hearts into it.
So just wanted to say that.
Candace Avalos
Thank you.
Steve Novick
I was putting myself at the end, but I see that you're back in the queue, Novick, if you want to take a minute, and then I would like to end I just wanted to note for the record that Councilors Green and Murillo have promised me that they will produce an actual social housing banner, and I'm looking forward to seeing the size and the color scheme.
Candace Avalos
Okay, good to know.
Um, thank you, colleagues.
So we've got a couple minutes.
I'll just end with a couple of my thoughts.
First, I'll just say, um, I have been taking copious notes as well as my staff.
We're trying to just collaborate and see where are the alignment, what, um, what are new things that we heard.
So I'll make sure that we report back what we heard.
I agree with a lot of what has been said.
I just want to put a finer point on the conversation around eviction prevention and rental assistance.
I think— let me start by saying yes, millions of dollars have been spent, but those dollars have not been spent evenly over time.
Out of the 18,000-some evictions prevented with SHS funds across the region, 2/3 occurred between July of '21 and June of '23.
And since then, spending has slowed significantly, especially in this last year at the state level.
For example, in Multnomah County, only 167 evictions were prevented with SHS dollars between July and September of last year.
So that's 55 households Councilor Smith.
Steve Novick
Thank you, Mayor.
Candace Avalos
So the city has been able to house 1,000 households per month, and that is a fraction of the need considering the county averages roughly 1,000 eviction filings for nonpayment of rent every month.
So in other words, thousands of people each month are on the verge of falling into homelessness because they can't make rent, and that same trend is happening at the city level.
And I think ultimately, you know, what I heard from the mayor as well, I agree that it's one thing to have, you know, shelters or all of these other measures that we're doing to get people out Councilor Smith.
We can get people out of crisis from the street, but if we don't have a way for them to go, we don't have a house for them to go into or dollars to help them get into that house, then it's kind of futile.
So I think that it is critical in my view that, and it is our responsibility to help address that.
And I think that we can do that with the rental services dollars, which is what they are made for.
So that's the main thing.
I think ultimately I feel really good about I'm hearing, because I do hear a lot of alignment between us.
It sounds like people want a braided, blended approach to these dollars.
I'm also seeing that there's some discussion about how much of the dollars people feel is allocatable, if that's a word.
And so I think that's something we'll need to suss out.
But I'll just close by thanking our amazing staff who have brought great knowledge to us, thanking my councilors.
I think that we had a fruitful discussion, and I will be discussing with Council President How we take what we learned today and move forward.
And with that, we will end the work session.
Loretta Smith
Thank you.