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.
Candace Avalos
Good afternoon.
I'm going to call the meeting of the Housing and Permitting Committee to order.
It is Tuesday, October 6th, 2026, at 2:01 PM.
Diego, please call the roll.
Unidentified speaker
Good afternoon.
Avalos?
Andrea Hamberg
Pret—.
Candace Avalos
One of my first.
Unidentified speaker
Sorry, I flipped that.
Green?
Mitch Green
Here.
Unidentified speaker
Pirtle-Guiney?
Elana Pirtle-Guiney
Here.
Unidentified speaker
Koyama Lane?
Tiffany Koyama Lane
Here.
Unidentified speaker
Novick?
Steve Novick
Here.
Unidentified speaker
Now Avalos.
Candace Avalos
Present.
Claire, can you please read the statement of conduct?
Unidentified speaker
Thank you, Chair.
Good afternoon and welcome to the meeting of the Housing and Permitting Committee.
To testify before this committee in person or virtually, you must sign up on— in advance on the committee agenda at portland.gov/council/agenda/housingandpermittingcommittee or by calling 311.
Registration for virtual testimony closes 1 hour prior to the meeting.
In-person testifiers must sign up before the agenda item is heard.
If public testimony will be taken on an item, individuals may testify for 3 minutes unless the chair states otherwise.
Your microphone will be muted when your time is over.
The chair preserves order.
Disruptive conduct such as shouting, refusing to conclude your testimony when your time is up, or interrupting others' testimony or committee deliberations will not be allowed.
If you cause a disruption, a warning will be given.
Further disruption will result in ejection from the meeting.
Anyone who fails to leave once ejected is subject to arrest for trespass.
Additionally, the committee may take a short recess and reconvene virtually.
Your testimony should address the matter being considered.
When testifying, please state your name for the record.
If you are a lobbyist, identify the organization you represent.
And finally, virtual testifiers should unmute themselves when the clerk calls your name.
Thank you.
Candace Avalos
Thank you, Claire.
Today we have 3 main items on our agenda.
First, we are going to start with a presentation on the climate and health standard policy.
Then we will have 2 ordinances.
The first ordinance brings the city's land use law into alignment with recently adopted state legislation.
The second ordinance makes code changes to allow the city to continue providing a property tax exemption for low-income housing.
I also need to note on the record that on September 22nd, 2026, the Bureau of Planning and Sustainability sent legislative notice via email announcing that the recommended draft of the Central City Code Amendments Project, including comprehensive plan map and zoning maps and Title 33 regulatory amendments, was scheduled for the Housing and Permitting Committee today, October 6th, 2026, at 2:00 PM.
However, consideration of the ordinance for the recommended draft of the Central City Code Amendments Project has been referred to the full City Council on Wednesday, October 14th, 2026 at 9:50 AM, time certain, for a public hearing to take oral testimony for this ordinance.
Written testimony can be provided through the MAP app.
All right, and let's go ahead and read item 1.
Unidentified speaker
Item 1, document number 2026-353, Climate and Health Standards.
Candace Avalos
Okay, thank you.
So today, as I mentioned, we're going to do a presentation, uh, on the climate and health standard, and let's go ahead and have, um, Gloria come thank you.
Please come on up and get settled while I do some intro remarks.
Um, first, colleagues, I want to begin by thanking the many people who have brought us to this point.
My office has been working with stakeholders across housing providers, industry, real estate, higher education, healthcare, and environmental justice over the past year to develop a new climate and health standards policy for the city.
But this work didn't start with me, and it also didn't start from the city alone.
It started with community at the grassroots, from Portlanders who were tired of being left out of conversations and whose perspectives weren't heard in climate spaces, despite coming from the communities most impacted by environmental pollution and climate change.
Those Portlanders put hours of their own time looking into energy use in the built environment, how building decarbonization policies intersect with racial justice, time spent in meetings in person and then over Zoom when the pandemic hit.
And they were moved by a deep commitment to families that look like theirs and the future generations who will suffer if we do not do our part now.
This work started 6 years ago, and I know there have been many community members waiting at least that long for us to get to this point of actually introducing the policy.
But before we consider the code changes that I'll be bringing to our October 20th meeting, I wanted to have a chance for the committee to hear from subject matter experts and advocates for this work.
So first, staff from the Bureau of Planning and Sustainability will share an overview of past work related to the city's climate and health standards for existing buildings project.
Then we will have 3 invited panels.
The first panel will have our Chief Sustainability Officer and Sustainability and Climate Commission co-chair.
The next panel will have invited guests from the county and community organizations working on climate justice.
And finally, we'll hear from leaders in other US cities who've championed building performance standards.
So colleagues, this time is really meant for us to get more familiar with the background of CHS and the broader context that the policy sits in.
This is not intended to be a space to really dig into the specifics since the ordinance, uh, will be coming next time, but you should have the ordinance text.
I have emailed a copy, and it's also available on my website in case folks of the public want to take a look.
And what I'm hoping to achieve at this meeting is just creating an opportunity to step back and consider what CHS means for the health and livability of our communities and our city.
And my apologies, Gloria, I gave you the wrong prompt because you're going to come after BPS, so you can, uh, you can stay up there or whatever.
But, um, uh, first I want to bring up BPS staff for a presentation on the history of the Climate and Health Standards for Existing Buildings policy and an overview of a recently completed pilot project.
Thank you.
We've got Andrea and Vin here if you want to introduce yourselves formally and take it away.
Andrea Durbin
Yes, just give me one minute to share.
Okay.
Good afternoon, Chair Avalos, Vice Chair Green, and members of the committee.
For the record, I'm Andrea Jacob.
I am the manager of the climate policy team at the Bureau of Planning and Sustainability.
Thank you for the opportunity to be here today to share some of the backstory of climate and health standards for existing buildings.
It's the precursor work, as Chair Avalos said, to the work currently led by her office.
So the core expertise of the BPS climate team lies at the intersection of the built environment and climate science, policy, and practice.
Bin and I have been working together on equitable building decarbonization since 2018, and we each have been working on climate, buildings, and energy at the city for about 20 years apiece.
So there's a fair bit of institutional knowledge here today.
Our work on climate and health standards has been guided by the Bureau's anti-racism and racial equity mission and values.
So this story— the story of this work is really a story of community engagement, community leadership, and community priorities.
Thank you.
It's an example of how government can innovate, adapt, and share power in policy development.
So we have 2 main sections of our presentation today.
Vin is going to walk you through a, a pretty abbreviated history of the policy just due to time, and we'll then present some findings from a pilot that BPS conducted with multifamily building owners and managers, and then we'll have time for some questions and answers.
Vin Mason
Thank you, Andrea.
Good afternoon, Chair Avalos, Vice Chair Green, and members of the committee.
For the record, my name is Vin Mason.
I work for the Bureau of Planning and Sustainability as a senior climate policy advisor and oversee Portland's commercial energy reporting requirements that were adopted by City Council in 2015.
Next slide, please.
I'll start with an overview of the climate health standards policy development timeline.
BPS's work on this policy began as a partnership with Build Shift, which was a collective of community members and organizations established by the Coalition of Communities of Color in Verde.
Through community-led engagement, we developed the HEART Standards policy concept to decarbonize Portland's buildings while advancing racial equity.
In 2022, the HEART Standards moved into the next phase of policy development.
Advanced by BPS as the climate and health standards for existing buildings.
This proposal included commercial and multifamily carbon performance standards that would require property owners to gradually reduce their carbon emissions.
The city also considered a maximum temperature limit that would provide cooling to rental housing.
BPS's policy development paused in 2023 after Oregon passed House Bill 3409, and began administrative rulemaking for statewide commercial building energy performance standards.
BPS estimates that the state's requirements will reduce carbon emissions from Portland's covered buildings by only 5%, well short of the city's adopted goal of zero emissions by 2050.
In 2024, BPS and the city's Chief Sustainability Officer moved a small piece of the climate health standards forward as the multifamily energy reporting and tenant notice proposal.
Draft city code was released for public comment in May 2024 and received much community support, but property owners were concerned about the cost of compliance and exacerbating the housing affordability crisis, a concern shared by BPS.
We pivoted to conduct a pilot project to examine the concerns of property owners and roll out PSF's SP2 funding for apartment building retrofits.
I'll cover each of these major policy milestones in a bit more detail, starting with the HART standards.
Next slide.
With twin goals of building decarbonization and advancing racial equity, the HART standards focus on 5 community priorities for rental housing.
First, improving the health of tenants.
Next, equitable energy that decreases utility bills without increasing rent.
At the center of the HART is anti-displacement to mitigate unintended consequences like relocation of tenants during building retrofits.
Another key community priority is resilience to future climate impacts.
The HART standards were developed in 2021, the same year as the Pacific Northwest heat dome.
A temperature limit for rental housing would assure access to cooling to help tenants survive extreme heat events in the future.
Next slide.
BPS received broad— broader stakeholder input on the HART standards policy concept through weekly building owner and tenant workgroup meetings in 2022.
We continued stakeholder engagement to refine policy details through 2024.
The engagement resulted in the climate health standards for existing buildings staff proposal with 3 main policy the first requires multifamily building owners with 4 or more rental units to notify prospective tenants of key climate and health information at time of application.
The purpose is to inform decisions related to the cost of energy bills, health risks associated with natural gas stoves, and access to cooling.
The second and third policy components would apply to buildings 20,000 square feet and larger.
Thank you.
This size threshold covers about 1,000 commercial and 1,000 apartment buildings.
The heating and powering of these large buildings accounts for approximately 16% of the city's total carbon emissions.
Next slide.
Okay, so this is the part of the policy that deals with the mechanics of how to actually get the carbon reductions.
Performance standards are an effective policy tool.
Unlike prescriptive retrofits, performance standards give building owners flexibility to choose a compliance pathway that is best suited for the unique circumstances of their building.
10 Other U.S. cities have adopted building performance standards to achieve their climate goals, including carbon performance standards in Boston, New York, and Seattle.
In Portland, these standards would require covered buildings to reduce their carbon emissions 20% every 5 years starting 2030 until zero by 2050.
In 2030, all covered buildings would already comply due to state mandates for electric utilities.
By 2040, the state requires 100% clean electricity, which would enable all electric buildings to meet Portland's carbon performance standards.
This chart shows how a poor performer like Building A would have a steeper slope to get from its baseline year to zero compared to a high-performing Building C. It also shows the long runway for compliance.
Building owners could choose from any combination of 3 compliance pathways: 1, reduce emissions through energy efficiency or onsite renewables; 2, electrify equipment; and 3, pay a carbon pollution impact fee in lieu of meeting the standard.
Recognizing the importance of compliance costs, BP has contracted Echo Northwest to complete an analysis of potential economic impacts of these standards.
The analysis concludes that there would likely be no net impact to renters' housing costs given a long compliance period for property owners.
Next slide, please.
All right, next I'm going to cover this part of the policy in more depth because energy benchmarking and reporting are the foundation for reducing emissions and saving energy.
Since 2015, the city has required property owners of Portland's largest commercial buildings to annually report their energy use and carbon emissions.
But multifamily buildings are not included.
This is a gap that BPS has long wanted to fill.
Next slide.
As noted earlier, BPS released a draft multifamily energy reporting and tenant notice policy proposal for public comment in 2024.
We received concerns from property owner representatives that benchmarking is extremely difficult to gather required information from tenants, and compliance could cost tens of thousands of dollars per building, leading to tenant displacement.
From May 2025 to May 2026, BPS contracted Efficiency for Everyone to lead a pilot project to clarify the compliance costs and pinch points for building owners to annually benchmark and report energy performance to the city.
Next slide.
5 Property owners volunteered to participate in the pilot, including representation of apartment buildings across all 4 council districts.
Next slide.
Property managers needed 3 to 9 hours to complete their initial energy benchmarking and reporting.
The amount of time to complete each step of the process varied based on utility provider and the number of meters per building.
Each participant relied on data aggregation services provided by their respective utilities.
All participants used 2 key resources: the free online Energy Star Portfolio Manager software maintained by the federal government, next slide, please.
Overall, participants called the benchmarking process easy to do and pretty basic.
All participants said future energy reporting would require less than 2 hours of their time annually.
Depending on the property manager's capacity and utility data aggregation, the duration of the benchmarking process ranged from 1 to 3 months.
Participants noted that the Portfolio Manager website is not intuitive, so support from the city's help desk was essential.
None of the property managers needed to interact with tenants to complete their energy benchmarking reporting.
These findings are consistent with BPS's implementation of the Commercial Energy Reporting Program over the last 11 years.
And last slide.
In closing, I'll note that carbon performance standards are a key action in the city's Climate Emergency Work Plan so with that, at this time we can take any questions from the committee that you may have regarding BPS's history in developing the climate health standards staff proposal.
And thank you very much.
Candace Avalos
Thank you.
Before we do questions, why don't I do my next presentation to just round out the information and then I'll open up for some questions, um, and we'll move to the next panel.
Um, and then we'll probably— I want to try to keep the panels to be able to get through their time, so I don't want to get too mired in questions.
If I need to move us forward, um, and then we come back to questions at the end, I'll let you know.
But we'll just kind of see what people have.
So, um, let's go ahead.
Thank you, uh, you all, BPS, um, for being here.
And then let me put up my presentation, which will just add the final little pieces of context.
Okay, there we go.
All right, um, so yes, again, thank you, Andrea and Ben, for your presentation on the background of the climate and health standards for existing buildings and the pilot study findings.
I think it really speaks to the thoughtful outreach and years of work that went into developing the policy, and my office has appreciated your assistance throughout this process.
So thank you very much.
Colleagues, this time is really meant for us to get more familiar again with the background of CHS and the broader context that the policy sits in, not necessarily to dig into those specifics, like I said, at this level, but we're going to get more into it with the future panels.
Um, so let's go ahead into the next slide.
All right, so I want to begin by just grounding in the 3 principles that have guided my office's work from the beginning.
So the first is climate action should not come at the expense of housing stability.
The second one is standards should be meaningful and enforceable while recognizing that some buildings face genuine technical challenges.
And third, communities should not continue bearing the health and climate costs of inefficient buildings.
And so that moves us into the CHS core pillars.
Um, and so essentially CHS builds on the city's existing commercial building energy program and state guidelines by creating multifamily residential annual energy reporting.
So CHS would add close to 1,200 of Portland's multifamily residential buildings to the over 1,000 commercial buildings that are 20,000 square feet and larger currently required to report out their energy use and carbon emissions each year.
This would cover about 40% of Portland's building sector emissions.
On minimum carbon— on minimum carbon performance standards, covered buildings must reduce greenhouse gas emissions 20% every 5 years starting in 2030 and reaching zero emissions by 2050.
Regulated affordable housing is exempt because those buildings are already being decarbonized through PSEF investments and Oregon's clean energy targets.
Climate and health information and transparency standard for tenants was really critical as well.
So owners of attached rental housing, fourplexes and larger, would be required to provide key energy cost and health information to prospective renters, like how to access average and peak energy cost information, available assistance for utility bills, and cooling— unit cooling systems such as central AC.
The proposal includes a carbon pollution impact fee as an alternative compliance pathway for certain covered buildings and alternative compliance plans for large institutional campuses with shared energy systems such as universities.
I think it is important to note those other compliance pathways for the carbon performance standards because this policy is not intended to be rigid or punitive.
CHS is intentionally built with flexibility and an understanding that not every building has the same road to decarbonization.
I'm grateful to everyone who has weighed in and offered suggestions as we've built, uh, as we have built up to this point to introducing the policy.
And, um, this policy is now stronger because of the multitude of perspectives that went into it.
In addition to all of the great engagement and outreach work that you heard about from Andrea and Vinh, my office conducted our own, including a workshop that was open to the public.
So in July, I held my workshop with me to— next slide— to hear feedback from key stakeholders in addition to the conversations we were already having over email and in other meetings.
We had a wide range of perspectives, including housing providers, real estate, community, labor, healthcare, and other interested residents that just wanted to talk about the impact of this policy on them.
People were split into 3 breakout groups.
And participants took turns discussing the energy reporting and carbon performance standard, tenant information and anti-displacement requirements, and the compliance and impact fee.
And participants were also encouraged to write down their feedback and questions for additional follow-up.
And so what we heard— my biggest takeaway is that we didn't hear broad opposition to the concept.
We heard a lot of implementation questions.
People didn't disagree with the necessity of cutting climate pollution from buildings, the need for transparency about building energy use and health concerns.
Buildings are one of the largest, if not the largest, source of climate pollution in our city, and Portland should be working to continue to ensure that our buildings match our current climate reality and to meet our climate goals, while also ensuring that renters should have access to safe, comfortable, and energy-efficient homes and basic information about the condition and energy usage of their housing.
Queesha Light
Second.
Second.
Candace Avalos
I want to end with a quote because sometimes as policymakers we can get too nitty-gritty in the language and lose sight of who we're doing this for.
In 2022, High Country News did a story about the Build Shift Collective and their work, work that really set the foundation of the climate and health standard.
And one member, Anjanette Brown, on why they're working to address the health, climate, and equity issues associated with homes said, bless you.
Uh, I envision that we are champions in saving our environment at whatever cost for our benefit for our future generations.
And so that is what this is about at the end of the day.
And so with that, I want to turn it over.
Let me check the queue here.
I don't see any hands for first panel.
We can always come back at the end.
Okay, sounds good.
So then I'm going to go ahead and turn it over to our next set of invited panelists who are going to share how the climate and health standard fits within a broader ecosystem.
So we're going to have, um, representatives from the Sustainability Office, Multnomah County community, and national organizations speaking before moving into questions and general discussion later.
So first up, come on up, we've got our Chief Sustainability Officer Vivian Satterfield and Sustainability and Climate Commission Co-Chair Jose Gamero-Georgeson.
Elana Pirtle-Guiney
Welcome.
Vivian Satterfield
Thank you, Chair Avalos, Vice Chair Green, members of the committee.
For the record, I'm Vivian Satterfield.
I'm your Chief thank you, Councilor Mitch Green.
Thank you, Councilor Mitch Green.
I'm Councilor Tiffany Koyama Lane, Deputy City Sustainability Officer, and thank you for the invitation to speak about the proposed climate and health standards policy and how it fits within the city's climate action goals.
I'd like to take this moment to acknowledge Councilor Pirtle-Guiney for dedicating a recent City Life Committee to actually discussing and taking a deep dive for the benefit of those members on the city's carbon emission goals and also a deep dive into the inventory and data.
So as always, this Office and the Sustainability and Climate Commission stand ready to support your work and help offer technical assistance.
As I mentioned in the City Life Committee, and this will be a briefer overview than what we offered that particular committee, Portland and Multnomah County have been tracking carbon emissions together for more than 30 years.
In 2020, the prior City Council declared a climate emergency and directed bureaus to restore a safe climate for all Portlanders.
So to do that, we must meet 2 targets.
The first one is to reduce emissions by 50% by 2030.
The first one is by 2030, which is to cut emissions 50% by 1990 levels, and then by 2050, reach net zero.
Collectively, we reached peak emissions in 2000, and as of 2023, emissions are 26% below 1990 levels, which is significant progress compared to the United States as a whole overall.
But we must move faster.
Hitting our 2030 goal requires reducing emissions about 5.5% every year from now on.
That's roughly 320,000 metric tons annually.
After 2030, the pace can ease slightly, but the work ahead of us remains substantial.
So this is a pivotal moment for cities.
As climate impacts intensify, we need to accelerate near-term action while continuing to build resilience for what's ahead.
Just last month in September, the United Nations Environment Program warned that crossing the 1.5 degrees Celsius global threshold will escalate risks into dangerous and even unknown territory.
Rapid collective action will help reduce those risks and improve our ability to bring temperatures back down over time.
Locally, our biggest sources of emissions are electricity, gasoline, what's referred to as natural gas, and diesel.
Natural gas is the outlier in all of our trend lines.
It's the only major fuel source with emissions increasing, up 18% since 1990 overall and 62% in the residential sector.
And unlike gasoline, there's no strong market pressure in the form of pricing that's driving consumers away from it.
Addressing this will be essential.
Shifting buildings off fossil fuels will take many years, and because equipment lasts decades, The decisions that we make now matters.
I do want to leave you, however, with some encouraging news.
A recent economics report from Climate Mayors shows that cities committed to climate action are proving that economic growth and declining fossil fuel use can go hand in hand.
From 2019 to 2024, these cities grew their GDP by over 11% while reducing fossil fuel use per person by 3.5%.
That's directly saving households roughly $1,000 a year.
An economy decoupled from fossil fuels is both possible and already emerging, and cities are leading the way.
Thank you for your leadership and commitment to addressing climate change.
I look forward to supporting your continued work and am available to answer any questions.
Jose Gamero-Georgeson
Thank you, CSO Vivian, and Thank you, Chair Avalos, Vice Chair Green, and all the members of the committee for having me today.
For the record, I'm Jose Gamero-Georgeson, co-chair of the Sustainability and Climate Commission.
I'm here on behalf of the full commission.
On August 20th, the commission voted to endorse the climate and health standards and recommends the council advance the policy.
Our recommendation letter is in your packet, but I do have copies if anyone would like a copy today.
We didn't reach this position lightly or quickly.
Our Policy and Implementation Committee was briefed in July by Chair Avalos, Bureau of Planning and Sustainability, and community partners.
Then in, uh, then in August, our committee went through code, the code language section, section by section.
Then we wrote an endorsement letter which was approved by the full commission.
Commissioners, bring expertise in climate, health, housing, labor, environmental justice.
They brought all this to that review and to the endorsement letter.
CSO Vivian talked about why buildings matter to our emissions.
I want to focus on what this policy means for the people who live and work in these buildings.
This is ultimately a health policy.
Gas appliances in homes and buildings pollute the air indoors and out.
In Multnomah County, building gas use is estimated to produce about 3/4 of the nitrogen oxide pollution of a gas-powered plant.
Renters often have no say in the equipment they live with.
With this policy, renters get information they've never had access to previously.
Before signing a lease, they'll know likely utility costs, whether the unit has cooling, whether it has gas appliances, and how it's ventilated.
This climate action doesn't come at the cost of housing stability.
When upgrades affect occupancy, tenants get temporary housing on or relocation help and a guaranteed right to return.
The commission sees decarbonization and tenant protection as one goal, not competing goals.
The compliance timeline is long and backed by a city pilot and an Eco Northwest analysis.
Reporting takes a few hours in the first year and less after that.
Because of this long runway, owners have time to plan and to implement, and rent increases aren't really expected.
This policy covers buildings the state building performance program doesn't.
The state standards starts at 35,000 square feet.
Portland's threshold is 20,000, which reaches more of our multifamily housing stock.
Thank you.
Councilmember Herbold.
Thank you, Madam Chair.
I'm pleased to see this policy come out of the community.
It grew from years of work led by frontline communities through the HEART standards.
Council can carry that work across the finish line.
The commission also has an ask for the future.
The proposal doesn't include a maximum indoor temperature standard from the HEART standards.
We support taking that up as a separate policy, and urgently, as the climate projections indicate, we'll experience longer periods The commission was created to give council specific, timely, and actionable guidance.
Our guidance is clear: please advance the climate and health standards.
Thank you.
Candace Avalos
Thank you both so much for your words of wisdom and expertise.
Thank you.
Um, let me see.
Okay, let's go ahead and move to the next panel.
Um, next we have Andrea Hamburg, Environmental Health Services Director for the Multnomah County Health Department.
Taryn Evans, Environmental Justice Director for the Coalition of Communities of Color.
And Sarah— I'm gonna mispronounce your last name— Wallisch?
Sarah Wallach
Wallach.
Candace Avalos
Wallach.
Sarah Wallach, Climate Justice Advocate for Community Energy Project.
Quinton Zondervan
Welcome.
Andrea Hamberg
Uh, good afternoon, Chair Avalos, Chair— Vice Chair Green, and members of the committee.
Vivian Satterfield
Glad to be here today.
Andrea Hamberg
I'm Andrea Hamburg, she/her.
I'm the Environmental Health Services Director from Multnomah County.
I'm here today on behalf of the Health Department to share our strong support for the climate and health standards being discussed today.
At its core, climate change is a public health issue.
Our buildings are our primary line of defense, and they play a critical role in keeping vulnerable residents safe during extreme weather.
Safe buildings protect us from illness and premature death.
Before 2021, dying from extreme heat was almost unheard of in our county, but since then we've seen a clear spike in heat-related ER visits, hospital stays, And we've lost beloved members of our families and our communities.
During the 2021 heat dome, nearly 80% of those we lost were seniors, over 70% of whom lived alone, and 94% died in their own homes without sufficient air conditioning.
These climate and health standards are a vital step to prevent that kind of heartbreak from happening again.
Multnomah County's Climate and Justice— Climate Justice Plan is a 10-year roadmap to lower emissions and protect frontline communities.
Strategy 5, which is supporting the health, well-being, and stability of households that rent, includes clear support for these standards.
It was included as a result of input and feedback gathered during several years of community engagement with climate leaders and partners that serve environmental justice communities here in Multnomah County.
Upgrading our buildings ensures renters have reliable cooling and clean air during heat waves and wildfire smoke events, and giving tenants clear information about cooling, ventilation, gas appliances, and energy costs empowers them to take actions to protect their health.
Our role at the Health Department is to track health, health risks, stand up for impacted communities, and prevent illness before it starts.
This ordinance opens up a great opportunity for the city and the county to work closely together on public health and climate.
Looking ahead, these standards are a fantastic starting point.
While gathering data on cooling is important, what really matters for health is whether a home maintains a safe temperature when it's dangerously hot outside.
As this work moves forward, We strongly encourage the city to look at setting clear indoor temperature standards aimed directly at saving lives.
Climate hazards don't care about city or county lines, and our response shouldn't either.
We're excited to partner with you on implementation and keeping— and keep building the connection between climate policy, housing, and public health.
Elana Pirtle-Guiney
Thank you.
Queesha Light
Thank you.
Tarren Evans
Good afternoon, councilors.
My name is Tarren Evans.
I'm the Environmental Justice Director at the Coalition of Communities of Color, and I'm here to talk about the work that went into developing the climate and health standards.
These standards are a culmination of years of deep community engagement with the communities most impacted by climate change.
In 2020, the Build Shift team was formed through a partnership between CCC and Verde bringing together community-based organizations and BIPOC community leaders to help shape what equitable building policy could look like in Portland.
The process began with acknowledging past harms and working to build trust between the city and community.
The process also began with values instead of technical policy.
Community members shared about the values that they wanted the city to hold in the process.
These values included things like justice, equity, health, and safety.
From this foundation, we worked to develop a policy that was rooted in these elements.
We also started in a way that was deeply connected to everyday experience.
We started with building trust between community and government, but also by meeting people where they were.
We didn't begin conversations talking about wonky terms like building decarbonization.
We started by talking to community members about what buildings they loved, And what were the characteristics of those buildings?
This helped us understand what people valued in the places where they live, work, and gather.
People talked about buildings that felt safe, healthy, and comfortable.
Shortly after this process began, the pandemic, devastating wildfires, and the 2021 heat dome all shaped the context for this work.
These events made even clearer that climate, housing, and health are deeply connected.
They also informed how we approached policy development.
The work could not just be about technical standards or emissions reductions.
It had to be about the conditions people were experiencing in real time— unhealthy air, extreme heat, high energy costs, housing instability, and the unequal impacts of climate change.
One of our early community workshops was about energy burden.
Energy burden is the percentage of your income that you spend on energy bills.
We had community members bring their energy bills and use an energy burden calculator to determine the percentage of the income that went to their utility bills.
We found that many community members had extremely high energy burden.
We also heard about the tough choices that many community members face, such as choosing to pay energy bills or for medication and groceries.
These are choices that people should never have to make.
We had a community convening after the 2021 heat dome An event that clearly demonstrated the immediate impacts that climate change is already having on our communities.
In addition to community members sharing stories of not having access to air conditioning, we also heard another story of community members who did have air conditioning but were afraid to use it because of the costs associated with using it.
When buildings lack proper insulation and sealing, and when they are expensive to heat and cool, people can still be left in a position where they technically have access to cooling, but Something that was done throughout this process was to connect it to lived experience of community members.
Too often, climate policy can be focused on technical aspects and emissions reductions without centering the people who are impacted.
Community members raised issues around energy burden, health, indoor air quality, affordability, and displacement.
Those issues became central to how the standards were developed.
Councilmember They help shape a policy approach that is centered on making sure that renters have better information, that health risks are more visible, and that displacement pressures are addressed.
From there, these standards provide a targeted path toward building decarbonization that meets the city's goal of getting to net-zero carbon emissions by 2050.
They provide transparency for renters about utility costs and indoor air quality risks so they can make informed decisions about where to live.
This process showed that when we begin with trust, values, and lived experience, we can develop climate policy that responds to what communities are actually facing.
I urge the committee to support this work and move the climate and health standards forward.
Thank you.
Sarah Wallach
Good afternoon, councilors.
My name is Sarah Wallach, and I am a climate justice advocate at Community Energy Project.
Community Energy Project partners with low-income communities on the front lines of climate change To create more resilient, efficient, and healthy homes.
CEP transforms homes, shares skills and community wisdom, and advocates for energy justice.
We believe that achieving climate justice requires accessible, sustainable energy solutions that deliver economic, health, and social benefits to those most impacted.
CEP recognizes through our clients that low-income families most often live in efficient housing, with renters often not having much autonomy over the systems in place Within their units.
By implementing a code like this, these families can benefit greatly from carbon emissions reductions and energy efficiency.
Here at Community Energy Project, we often work with renters in DIY-friendly educational workshops.
However, that is not a holistic solution.
Renters deserve to be able to have energy efficiency repairs and upgrades within their multifamily properties.
Through our combined education and home energy saving upgrades and repairs, Thank you.
Programs, we have seen the effects of what these upgrades mean to families and the significant savings and health impacts.
Our clients who have upgraded from gas furnaces to heat pumps and have had weatherization services performed have saved upwards of $1,000 annually.
Though this research was modeled off of single-family homes, it shows how electric and efficient cooling and heating systems can have an effect on energy burden as well as energy insecurity in general.
Such measures can also offer renters greater financial stability, better health outcomes, and improved comfort in their own homes.
We also want to note that gas appliances contribute to indoor air pollution, which is increasingly linked to asthma, respiratory illnesses, and other long-term health impacts.
For many families, especially those with young kids, this health risk adds an additional stressor to a household.
Implementing a code like this means that the health, safety, and livelihoods of our clients would increase.
We need to acknowledge also that energy costs have been going up from rising rate costs to the impacts of climate change.
We need to think about energy usage and how we make our homes more efficient.
This leaves low-income communities with the harsh reality of either having to consume too much electricity and having a bill they cannot afford, or making unsafe energy-limiting choices to save money.
Thank you.
We urge the councilors to support this policy as it helps ensure renters in Portland have access to safe, healthy, and efficient homes.
Thank you.
Candace Avalos
Thank you so much.
Um, before I bring up the next panel, I just wanted to note, because it's come up a couple of times, that one of the big parts of the HEART policy concept was the indoor temperature standards.
We are not addressing that in this policy, but it is next on the policy list.
So just so the public knows, that is absolutely of interest to my office.
It's a component of the work that the community did.
We're choosing this action to take.
That action is far more complicated.
And as somebody who worked at an organization when we were doing our right to cooling bills in the legislature, there's lots of other layers to that.
But just want to name that because it is going to keep coming up.
It is a genuine health concern.
It's something I think the city should do.
Thank you.
And flagging for a community that, one, we want to talk about it, and two, if you have ideas, bring them on by.
Lastly, I am very excited to welcome our national guest panelists who are joining us online.
So we've got Rajiv, who is Director of Government and Utility Engagement for the Institute of Market Transformation, and Quinton, who is the Policy Director for Run on Climate and a former city council member of Cambridge, Massachusetts.
Welcome.
And whoever would like to kick us off, maybe Rajiv?
Rajeev Ravalapati
Sure, I'm happy to.
And I'm guessing— I normally don't— I'm no Cher.
I don't just go by Rajiv.
I'm guessing that was a nod to not messing up my last name.
So my last name is Ravalapati, for the record.
Thank you, Councilmember Avalos.
I'll be brief with my comments.
So thank you, Chair, members of the committee.
My name is Rajeev Ravalapati.
As the council member said, I'm with the Institute for Market Transformation, also known as IMT.
I serve as our Director of Government and Utility Engagement.
IMT is a national nonprofit, and we work with governments, building owners, community partners across the country to improve building performance.
And we have previously advised and worked with the City of Portland, Bureau of Planning and Sustainability on their benchmarking ordinance and BPS.
So the reason I am— have been asked to present today is to offer 3 perspectives.
One, why building performance standards matter.
2, What are we seeing nationally?
And 3, how Portland's proposal compares with best practices.
So first, why building performance standards?
First off, climate commitments yes.
Thank you.
So, building performance standards need a practical strategy for existing buildings.
Building codes primarily address new construction and renovations.
Incentives help owners invest.
Benchmarking makes energy use visible.
Building performance standards add a clear expectation that existing buildings improve over time.
That expectation helps, helps owners incorporate improvements into capital planning, equipment replacement, and everyday operations.
The government establishes the outcomes and the timeline while owners identify solutions appropriate to their buildings.
The public value extends beyond carbon reductions.
Better building performance can reduce wasted energy and support comfort and affordability.
Portland's approach also recognizes that building improvements should protect people who live in those buildings.
Secondly, what is happening, happening nationally?
One of the things that my organization tracks.
Early implementation results are encouraging.
The first vanguard of BPSs were only passed in the late 2010s, early 2020s.
The first BPS that was passed was in 2018 by Washington, D.C.
So from the early implementation results, they are encouraging, although we should distinguish reporting participation from actual performance improvements.
So what I have to offer is New York City, the biggest market in the country, the biggest jurisdiction with a BPS, reported that approximately 93% of covered privately owned properties submitted their first Local Law 97 compliance reports, and Local Law 97 is their BPS program.
That 93% demonstrates the participation at scale in a large, complex real estate market.
It does not mean every building has completed the improvements needed for future targets, to be clear.
Washington, D.C. provides evidence of actual energy improvements.
A preliminary analysis of approximately 360 multifamily office and hotel buildings that initially fell below the standard found average energy intensity reductions of about 13% between 2019 and 2024.
Adjusting for weather and operating conditions.
That is meaningful progress before the compliance cycle even ends, though it's not a final compliance determination.
Denver and Washington State offer another lesson.
Jurisdictions can adapt timelines and compliance— compliance pathways to practical constraints while continuing implementation.
Effective flexibility maintains clear obligations and measurable progress.
And third, how does Portland's proposal compare?
Several elements align well with sound policy design.
I think the, the draft currently established a clear emissions trajectory through 2050, annual reporting and independent verification.
Its aggregated utility data provisions address a fundamental prerequisite.
Owners need whole building information without playing— placing unnecessary burdens on tenants.
It also includes concrete displacement, anti-displacement protections, restrictions on passing compliance costs to residential tenants, and periodic review of tenant impacts and electric system capacity.
Those are all important key parts of implementation.
The last— the thing that I would like to end in is on suggestions for potential technical refinements or considerations.
One.
Make sure the requirements are actionable early.
The draft uses a 2027 or 2028 baseline and evaluates first performance in the calendar year 2030.
Publishing rules, implementing rules, emission calculation methods, and building-specific targets early enough for owners to plan, finance, and execute projects.
So having that upfront clear criteria for the existing alternative baseline provision.
Will recognize early investments and encourage early adoption, which is key for any BPS.
Second, make flexibility available where it can deliver results.
I think the draft already provides extensions and exemptions for documented constraints.
It's just a matter of considering making the pathways available to other buildings with legitimate constraints, with enforceable milestones and a clear endpoint.
A plan can accommodate equipment replacement cycles while keeping improvements moving.
And third, this goes to any jurisdiction that IMT helps advise, funding implementation reliably.
So directing pollution impact fees toward retrofit assistance is useful.
It is notable to say that fee revenue depends on buildings falling short of their targets.
So core staffing and owner support needs that kind of dependable funding, including before fees are collected.
So the— also the 7% administrative cap, we do like that and recommend that.
And as actual implementation needs happen, should the policy pass, it is good to gut-check that administrative cap while actual implementation proceeds.
Again, if the policy proceeds as forward.
Lastly, throughout implementation, coordinate with the State of Oregon's program so owners can reuse data and technical work where possible.
So in closing, Portland has a strong foundation.
It has clear requirements, accountable flexibility, and sustained support can turn this ordinance into a practical investment framework that improves buildings while also protecting housing stability.
Thank you for your time.
Candace Avalos
Thank you, Rajiv.
Go ahead, Quinton.
Quinton Zondervan
Thank you, Madam Chair, members of the committee.
My name is Quentin Zondervan.
As noted, I am the policy director at Run on Climate, and prior to that, I served 6 years on the Cambridge City Council in Massachusetts, where we often looked to Portland for some of our climate policies.
And I'm happy to report that in Cambridge, we were able to adopt a building performance standard in 2023.
When I was still on the council, where I led that effort.
And I will note that initially the proposed ordinance was scheduling emissions to reach net zero by 2050 for all the covered properties.
And myself and several of my colleagues at the time strongly advocated for a shorter timeline of 2035 for the biggest buildings because those buildings were contributing the majority of emissions, and we did not think it was a good idea to wait until 2050 for those buildings to reach zero.
But in that process, we did encounter some opposition, primarily from the universities, Harvard and MIT, and also the very strong and successful biotech sector in Cambridge.
And so that started a process of negotiation that took a couple of years to resolve, but ultimately we were successful in requiring the largest buildings, over 100,000 square feet, to reduce their emissions to zero by 2035.
And the way we got there was through a lot of the flexibility that Rajiv was highlighting, which allows the building owners, the property owners, to achieve that goal in as flexible a way as possible.
So we tried not to be overly prescriptive about how they got there, but made sure that they had to get there.
So one mechanism that we included was a campus mechanism where they could combine several buildings to report their emissions reductions, and this allows them to flexibly work on their entire building portfolio rather than having to track and report on individual buildings' progress on achieving zero emissions.
The other piece that we negotiated was to allow in a very limited way, very strictly approved carbon credits in a very limited way after 2035, so that primarily— and this was only available to the largest buildings, which again is primarily Harvard and MIT.
This allowed them to offset their hardest-to-eliminate emissions for a, you know, reducing period of time after 2035, but ultimately they had to stop using those carbon credits by 2050 as well.
So those are just a couple of examples of flexibility that we introduced.
In, in the ordinance in Cambridge to work with our largest polluters in, in the city.
And in Cambridge, over 80% of our emissions came from buildings.
So this provision was really important to our goals of eliminating our climate change-inducing emissions.
Thank you.
And now at Run on Climate, we work to support policymakers like yourself across the country in passing similar policies.
And what we find is that most cities are not able to achieve their climate goals without a building performance standard.
And so you are already on the right path, and we strongly support your effort.
And encourage you to move this legislation forward and to adopt it.
And we stand at the ready to assist you.
Unlike our colleagues at IMT, we are not technical building experts.
We bring a network of policymakers across the country who have or are working on similar policies.
And we bring that lived experience of having implemented these policies in different communities across the country so that you can compare notes and learn from some of the on-the-ground lessons that are being learned over time as these policies are being implemented.
Cambridge adopted the policy in '23, and then the first compliance period for these largest buildings over 100,000 square feet began in January of this year, 2026.
And currently, the staff expect the vast majority of the buildings to comply with the 2029 compliance period requirements, reduction requirements.
So most of the buildings are already ahead of the game.
Because they're already electrifying and making energy efficiency improvements, or in some cases they've already done so.
And then the city staff has invested extensively in providing assistance and guidance.
The ordinance requires the seating of an advisory committee, which has been established.
That will also oversee exception or exemption requests and applications, as well as approving specific carbon credits that will be allowed to be used.
And to demonstrate how stringent our criteria were, there are currently no carbon credits in existence that meet our criteria.
So they would have to continue to improve those standards before they could use them.
So those are some of the highlights from Cambridge.
We're currently working with a number of jurisdictions across the country, including Watertown and Somerville in the Boston area, as well as Burlington, Vermont.
We assisted Evanston, Illinois.
Last year in adopting their Healthy Buildings Ordinance.
And so we stand at the ready to assist you at no cost, and we're happy to answer any questions or connect you with anyone who can answer your questions, including stakeholders in the communities where these building performance standards have been successfully implemented.
Thank you, Madam Chair.
Candace Avalos
Thank you both so much for joining us, uh, virtually.
We appreciate your time and expertise.
Um, so that is all the panelists.
I'll thank all of the panelists for joining us.
And, um, ultimately, I think what I hope we hear in this is that, uh, there are lots of cities that are trying to tackle this problem and have made some great strides.
And so I'm grateful to the perspective of our panelists to talk about how we can make those same moves here, uh, in Portland.
So now we've got— and we're a little bit ahead of schedule, so we've got, um, about 40 minutes to discuss, ask questions.
Um, I've got a bunch of questions I can ask to kick it off, but want to see where the committee's at, if you've got questions or comments.
All right, Councilor Novick, kick us off.
Steve Novick
Thank you, Madam Chair.
And I've got a bunch of questions, which, most of which probably should be postponed until 2 weeks from now.
So just shut me up when you think of SNF.
Hmm.
And I wanna begin by saying that I start off being heavily biased in favor of this proposal, partly frankly because my old friend Angus Duncan, who was the head of the Global Warming Commission, is on the Climate and Sustainability Commission.
And I called him up and he said, yeah, this is good.
Having said that, though, we're going to hear a lot of questions about, is this going to raise rents?
Is this going to further depress our commercial properties, et cetera, et cetera?
So I do think that we need to at least ask those questions.
I will give full disclosure.
I asked Multifamily Northwest what are some of the questions they would ask, and so they gave me some.
In some cases, the premise of their question might be totally wrong, and I'd be happy to hear that.
But so just with that.
Thank you.
With that in mind, one question is, I think that for 2030, we're sort of allowing the buildings to assume that PG&E and Pacificorp have met their decarbonization targets mandated by the state.
But it's my understanding that that's not true for the subsequent years, 2035, 2040, etc.
And I'm just wondering what the thought is there.
Is consideration given to saying, okay, you can always assume that PG&E and Pacificorp Vin, do you want to come start to address that?
Candace Avalos
I'll note that I sent this same question over to Vin earlier today, and I'm expecting to get a full answer.
So if you don't have one right now, that's okay, but know that it is a question in the pipeline.
Go ahead.
Sure.
Vin Mason
Thank you, Councilor Novick, and it's an important question.
So for the clean energy targets at the state level, there has been some uncertainty in that we've seen more certainty over time that there are investments that are being made to meet those targets.
Yes.
We're seeing significant investments in renewable energy happening from both Pacific Power and PG.
They've reduced their emissions by approximately 30% from 2010-2012 baseline to 2024.
So we're seeing that progress.
Their clean energy plans indicate additional progress.
And at the same time, until the first deadline is reached in 2030, it's an 80% goal of reduction, there will always be a little bit of uncertainty until then.
And so to give To give property owners some reassurance, our staff proposal has assumed that there is a— the clean energy targets will be reached.
That makes 2030 essentially a procedural climate or procedural compliance year.
And as noted earlier, that's the engagement that would lead to the planning for investments to get to 2035.
Thank you.
Now, in 2035 and 2040, I think it's also some unknowns that are there.
Candace Avalos
Okay.
Steve Novick
I mean, I think that the question is, I mean, if we think PG&E and Pacificorp meet their targets for 2030, that's great.
That helps reduce emissions.
But if PG&E and Pacificorp don't meet their targets for 2035, 2040, et cetera, then I think we can assume that the The cost to the building owners of meeting these targets might be rather high compared to if PG&E and Pacifica do meet their targets.
So I'm just wondering, what's the argument against just saying we— and actually, I'm curious what other cities have done about this, because I think that other cities that also have their sort of like renewable portfolio standards thing, what's the argument against saying we're going to do the same thing in 2035 and 2040?
Queesha Light
Yeah.
Vin Mason
Well, I think one argument would be if it's just not technically feasible for the utilities to get to their 2035 and 2040 targets.
I don't think we're seeing that right now, but that would be one argument, is to wait and see if it's even technically feasible.
If it's not technically feasible, then a regulated credit mechanism could be considered, and that's what's used in a limited way in Boston, Massachusetts, as well as New York.
And it was referenced in the credits, the carbon credits by Cambridge as well.
So there is another route, but based on the current information that BPS has been tracking on the progress towards the clean energy targets, we don't think that option is necessary.
Candace Avalos
Councilor, it looks like Quentin might want to answer your question.
Steve Novick
Yeah, thank you, Quentin.
Candace Avalos
Go ahead.
Quinton Zondervan
Thank you, Madam Chair.
Through you, yes, the, um, this issue did not come up in Cambridge in the sense that we didn't make any assumptions either way.
Um, but the covered properties can, of course, include whatever the emissions are on the grid as part of their compliance.
Thank you.
And so I guess the broader assumption is that the utilities are going to achieve those goals, but the city did commit to, through its own community choice aggregation program, provide very low emission electricity to its basic service ratepayers.
And so even if the utilities don't achieve those goals, this— the city's community choice aggregation program would allow the properties, at least through their electricity consumption, to receive credit for that low emissions electricity.
Steve Novick
Thank you.
Um, actually, I'm going to move on to another question, if I may.
So one of the questions that Multifamily Northwest asked was something about what's going to be the impact on naturally occurring affordable housing.
And I'm not going to, you know, they're like raising the spectrum that if people who currently own, quote, naturally occurring affordable housing have to bear too much cost, they might sell out to private equity, et cetera, et cetera.
But I'm going to ask something more specific, which is, I mean, there's a guy named Joe Weston.
Yes.
Who for many years has owned properties where the rent is unusually low and they tend to be old buildings.
And I was— and he's actually, I think, transferring his buildings to some sort of foundation.
And I'm just curious, have we done outreach specifically to owners of private housing that is unusually affordable, sort of talk them through how they would comply with this?
Vin Mason
Yeah, so we did extensive outreach at BPS from 2022 to 2024, including weekly building workgroup meetings that were for property owners.
So the outreach, I believe, did include Joe Weston invitation, but I think the representation was from Multifamily Northwest in those spaces for the private property owners.
Sarah Radlett
Yeah.
Steve Novick
But what did the— in the outreach, did you sort of like ask them to sort of game out what they think would be necessary to meet the 2030 targets, the 2035 targets, et cetera?
Vin Mason
Through those engagement meetings that lasted over many months, we heard the concern about the potential impact on not just the property owners, but potential pass-through costs.
Right.
So as a result of that, we contracted Eco Northwest to really look at what would be the— especially for a first carbon performance standard, what would be the outcome.
And they confirmed what I think many of us know is that the rental market is a very complex system that has a lot of factors that are involved.
But at the scale of retrofits necessary to comply, they concluded no net impact on renters.
It's through pass-through.
And that is a conclusion that was very important to us because we were specifically concerned about naturally occurring affordable housing because of our previous engagement with Build Shift and how they might be impacted.
But some of those other factors are just the ability to pay, for instance, for the but didn't Eco Northwest just focus on 2030 rather than 2035, 2040, etc.?
That's a good point.
Yeah, so when we were looking at the carbon performance standards back then, we were looking at a, um, a very aggressive kind of timeline for adoption, and 2030 was a, a big year for a jump.
Uh, this is similar to what Seattle had adopted, and since then our conclusion is that that long compliance period, which also ECON Northwest points out, that's very important to prevent that pass-through.
The long compliance period is very important.
So now we're looking at, it would be more like a 2040 to 2045 timeline where multifamily properties would be impacted rather than a 2030 timeline.
Quinton Zondervan
Okay, thank you.
Steve Novick
Another issue that's been raised is What if you've got a property that's largely vacant and you have to use that, you know, the energy use as of now is the benchmark, and then a whole bunch of people, you know, move in and their energy use goes up?
How does the policy adjust for that, or does it?
Vin Mason
These are all great questions for me, aren't they?
Yeah, so being familiar with that concern in 2022 while we're engaging folks, and it was yeah.
Deep in the pandemic too.
We explored that question in some detail.
And so as the staff proposal advanced, we really considered how do we address the vacancy?
And the key for these carbon performance standards is to set the right baseline.
So we explicitly state 2027 and 2028 as 2 options.
But then a property owner could ask for a different baseline.
For instance, if down the road they had a higher level of occupancy, that would be a very reasonable consideration.
The other thing we heard is that property owners more recently made investments, and so they wanted to get credit for those advancements.
In Portland, there's commercial buildings have been reporting for over 10 years, so they might have a year that says, well, Here's where we were before we made all these investments.
Can we get credit for that?
So that provides that option for them too.
Steve Novick
Yeah, I was familiar with that.
One thing I worry about is if we have it be too individualized, we might need to like have lots of FTE in the city sort of looking at these individualized proposals.
So when I was talking to Angus about this issue of whether you require everybody to reduce by 20% a year, people start at different places.
He said that in some In some energy efficiency context, the sort of alternative to a percent reduction every X amount of time is to set sort of an efficiency target.
Say this is where the top third of buildings are, so everybody needs to meet that by X date, which I think might be easy.
I mean, off the top of my head, might be sort of easier to administer.
And we'd sort of be telling people, all right, if you've Done a— if you've done a bunch of work, then you should already be meeting that target.
But if you haven't, you at least have to do that.
Sort of like energy effi— you know, energy use per square foot or something.
It has to be down to a certain level.
Was there a consideration of sort of an option like that, um, instead of individualized target meetings, saying here's a target that everybody has to meet?
Vin Mason
Yeah, uh, That's another approach to take.
Seattle takes that approach, and then the state of Oregon also takes that approach with their building energy performance standards.
Seattle has carbon performance standards.
In examining that approach, one of the key considerations was that if we set a target as they did, which is if there's a goal for, let's say, the whole multifamily sector to get to 20% reduction, then they say, here's where the target is.
Yeah.
But the challenge in that is in those first compliance years, this goes back to how we changed things so that 2030 wasn't the hardest year to be hit for naturally occurring affordable housing.
The poorest performing buildings have to make the biggest jump to get to that target.
And we really thought that didn't seem equitable.
And going back to the concerns that you mentioned earlier, that an unintended outcome that we wouldn't want to see is for folks to feel like, or property owners to feel like that they would have to move on from their buildings.
Steve Novick
Okay, thank you.
I also just have to note that we've heard about 3 jurisdictions where I've lived: DC, New York, and Cambridge.
So that was kind of like homey.
Thank you.
Great.
Candace Avalos
Well, let's do it like those 3 cities.
Go ahead, Councilor Pirtle-Guiney.
Elana Pirtle-Guiney
Thank you, Chair, and thank you, Councilor Novick, for many of those questions.
I have a couple of questions.
If I run too long, Chair, let me know.
I want to start with just understanding the differences between what was in the work that the Bureau was doing previously and what is in the proposal that is now under discussion.
I know we're saving specific conversation about that proposal for when it comes forward in a few weeks.
But we heard presentations on both today, and I'd like to make sure that I'm properly thinking about what we have before us now and what has changed from what was before us previously and why those changes were made.
Candace Avalos
I can start to answer that, and then you can speak more to the history.
I mean, in general, this is a proposal, the language, the work has been led not by my office.
It's been led by BPS.
It's been led by community.
So the changes that we've made, you know, they've been working on it since 2022.
Like they said, there was a moment where they took a pause, did the pilot, uh, commissioned the Eco Northwest study, um, and there were changes that of course happened from that point.
And that came— and those changes were made prior to coming to me, right?
So I'm coming in at the tail end as far as the actual language.
And then coming in with the workshop with me and the other engagement that I was doing, there were some changes that have been made most recently, some of the ones that I've shared with council, um, from concerns that have been coming in recently.
But for the most part, the changes have not been made by my office.
They've been made by BPS, and it's evolved over the course of that time.
Elana Pirtle-Guiney
So I'm looking for specifics and understanding the policy that we will have before us compared to the policy that was last aired as BPS was doing this work previously.
What, what is different now?
Because I've heard that there are some significant differences.
Andrea Durbin
This is Andrea Jacob for the record.
We have looked at the code that we left off with in November of 2025 to what is currently posted on the, uh, councilor's website.
So those are the 2 points that we looked at.
At a high level, we can say that, um, from our draft to this draft, uh, residential condos So those are no longer covered.
On the carbon performance standards piece, there's this bit about 2030 and the greenhouse, assuming that the utilities are going to meet their target.
That is a new piece that BPS did not make from our— in our draft.
There's a bit from— in the carbon performance standards around swimming pool heating at the requester parks.
We are excluding that.
Okay.
From the calculations.
Final—.
Or when I say we, Councilor's draft.
Councilor's draft also includes the idea that offsets and renewable natural gas and unregulated credit mechanisms, these other ways of meeting the goal, will not be considered in the final carbon performance standards.
Elana Pirtle-Guiney
So those were— that flexibility was previously granted and is not granted That's my understanding.
Queesha Light
Can you confirm that?
Vin Mason
That's right.
Vivian Satterfield
Okay.
Andrea Durbin
There's a good bit in there around alternate compliance plans, and those are specifically addressing concerns by campus institutions that the Counselor's Office was responsive to.
So clarifying that, you know, just the definition of what a campus portfolio is.
It allows more— generally what those changes do, allow more flexibility for the campus institutions to comply.
There was a change in the carbon pollution impact fee.
BPS, if left to, you know, in our code, we did not get specific about a cost per metric ton.
This draft, the councilor's draft, does get more specific about that.
And then on the extensions and exemptions, all electric buildings in this, in the current draft, not the BPS draft, could seek an exemption.
Okay.
So that's a pretty high-level summary of what we see as the changes from when we left off.
Elana Pirtle-Guiney
Great, that's really helpful.
Thank you.
Um, I think you all are probably the right people to answer my next question.
I am trying to understand what zero means.
So we have this standard where you reduce from baseline 20% every 5 years, which means that in 25 years we have to be at zero.
And I heard in the presentation that ways to get there can include energy efficiency measures, onsite renewables, electrification, paid offsets.
As we look at getting to zero, are all of those things going to be required?
And what I'm thinking about is if a building owner electrifies and can guarantee that all of their electricity is renewable sources, either because of onsite renewables or the portfolio of our electrical utilities, do they need to do any of the energy efficiency upgrades that would help lower utility costs for renters?
Do they?
So let's, let's start with that, right, as an example.
Similarly, if you do all of the energy efficiency upgrades, you have the tightest the tightest building possible in terms of your building shell and energy leakage, and you've done everything you can there, but you are still using natural gas.
Is there any way for you to get to zero?
Is there any way to get to zero with the use of natural gas, or is this a default electrification bill, though it's not being pitched that way?
So that's 2 examples.
Thank you.
That I have talked about with folks, but I'm wondering what zero means and what we actually are requiring to get there.
Vin Mason
Yeah, great questions, Councilor.
So I think I'll start with the second question first on energy efficiency if a building uses natural gas.
So to get to zero, natural gas served buildings would have to not use fossil fuels because you can't get to zero carbon emissions with fossil fuels, with one exception, which would be carbon capture and storage.
That's a technology that is under development.
It seems like it's constantly emerging, though.
And so that is a possibility.
Elana Pirtle-Guiney
But that would be allowed under the proposal that we're going to be seeing in a few weeks?
Vin Mason
It's not specific right now in the proposal because it hasn't emerged.
But that would be one of the ways that a natural gas served building could get to zero.
Yes.
And did I answer all of your question, or is there more?
Elana Pirtle-Guiney
I think that's— that was the second example I gave.
The first was if you fully electrify and you can guarantee that it's all renewable, renewable sources, would you have to do any energy efficiency Or could we have a leaky building with incredibly high utility costs for renters, but because it's all onsite solar or whatever it is that you're using as your renewable source, you actually don't have to do anything else?
You're already at zero.
Vin Mason
Yeah, and that, that is correct.
So this is a zero carbon performance standard by 2050.
And so any type of electrification to get there would be included.
With that said though, to reach the early targets, energy efficiency would be the wiser way to make an investment.
And what we've seen in the other cities that have adopted these kinds of policies is to have navigators to help property owners make good decisions for their investments.
There was one other thing I was thinking of too that— oh, and also I wanted to point out that this policy is really complementary with the state's policy.
Okay.
I mentioned before, the state only gets us to a 5% carbon emissions reduction.
The goal to zero is 100%.
But that is an energy efficiency policy.
So we have the state's energy efficiency for the least performing buildings to get it to average.
That would be addressing much of that piece.
And by doing so, those property owners would gain reductions in carbon emissions too.
And finally, that there are funding sources.
And so that navigator that I mentioned earlier would be connecting funding sources for property owners.
There's a stack of incentives, and it's not just PSIF, I'm happy to say.
There is the Oregon Housing Community Services Multifamily Energy Program that has a substantial amount of funding, and there are existing programs at the Energy Trust of Oregon that can provide incentives to really improve efficiency.
Elana Pirtle-Guiney
Certainly.
Changing gears for a minute in my question here, in the pilot program that we have run, were the—.
Candace Avalos
Can I just pause you real quick just because I see one of the other panelists.
Quinton, did you want to reply to Councilor Pirtle-Guiney's question?
Quinton Zondervan
Yes, thank you, Madam Chair.
Through you, just wanted to weigh in on the question about an all-electric building that is receiving all of its energy from electricity, from renewable electricity.
And at least in, in Cambridge, that would be considered a zero-emissions building.
Mm-hmm.
But we have not ever seen anyone attempt to convert an extremely poor-performing building in terms of energy efficiency to 100% renewable without improving the efficiency, because that would be economically not advantageous.
Because if you're wasting a lot of energy, then your payback period on renewable Energy is much longer, and so there's a built-in incentive to improve the efficiency as you switch your energy source to renewable electricity.
Elana Pirtle-Guiney
Thank you.
In the pilot that we've been conducting, do you know the age of the buildings?
And I am wondering if these are are predominantly, obviously not new, but newer buildings or predominantly significantly older buildings.
And if there's anything that we need to be aware of in terms of how that pilot will, how the results of that pilot will transfer to buildings across the city, if they were all a similar age or a similar type of build, where we might need to think about how other types of buildings yeah, that's a great question too.
Vin Mason
And there's a wide range of ages of buildings and the renters that are served.
So one of the buildings is naturally occurring affordable housing, another one's regulated affordable housing.
Others are at market rate across the kind of income spectrum, from our understanding.
Quinton Zondervan
And so I think that's a really important question.
Unidentified speaker
Thank you.
Vin Mason
And there's various ages.
And one thing I think is really interesting, when we have that commercial energy reporting data in hand in our first year, we heard repeatedly concerns about like, what about the older buildings because they'll be poor performing?
And then the city actually discloses that information on a map as the incentive to do better.
And won't this be shaming these older buildings?
And what's fascinating when we have the data, and this is pretty consistent across the US, The highest performing buildings are before we started conditioning them in the 1940s.
So when we look at, like, when we have modern building energy codes since 2010, the performance of those modern buildings is very similar to those from 1880 through 1920s.
Elana Pirtle-Guiney
It's the buildings in the middle that we have problems with.
Vin Mason
Yeah, especially if they're air-cooled.
Elana Pirtle-Guiney
I would love, as we move forward with these discussions to just learn a little bit more about the pilot and what we learned through those buildings to help us understand how this program will work moving forward.
Um, I have a question about institutions.
Do we know very much— and maybe our panelists online could help with this— do we know very much about how institutions were treated in other major cities and what what allowances were needed for our large healthcare and education settings to be a part of this program in a way that works for those types of campuses?
Vin Mason
I could share something, but Quentin, do you want to share the—.
Elana Pirtle-Guiney
Yeah, Mr. Sondervan, did you have something there?
Quinton Zondervan
Yeah, certainly happy to speak to that.
As I mentioned in my remarks, there was initial opposition from Harvard and MIT, who own a lot of property in Cambridge, when we pulled in the deadline for the largest buildings to be 2035.
And that took about 2 years to have that conversation with them.
But ultimately, we were able to land on a policy that that they were happy with, and that included a lot of flexibility mechanisms, including, as I mentioned, carbon credits, the campus designation.
We also designed a deferral mechanism where they could essentially— so we, we did include an alternative compliance fee of $234 a ton.
And so in theory, they would owe that amount at the end of the compliance period if they didn't meet the designated targets.
But through this deferral mechanism, they could receive a deferral on paying those fees in exchange for presenting a plan that has to be approved by the advisory council.
Thank you.
And that plan would allow them to say in 3 years or 4 years, we're going to make these major upgrades and we calculate that it will reduce our emissions beyond what will be required at that point.
And if they meet those, you know, sort of prospective emissions reductions, then They don't have to pay those fees.
But if they fail to meet those reductions, then they have to pay the fee plus a 10% penalty for not meeting those reductions.
Yes.
And they really like those provisions because it allows them to plan ahead several years.
And even though they don't meet the requirements in the compliance year, They can defer the payment of those fees and catch up in, in a few years if the city approves their plan.
Elana Pirtle-Guiney
So it sounds like there was essentially an alternate track for those institutions with the ability to do things on a timeline that is more in line with the institutional planning that's required in spaces like that.
Is that correct?
Quinton Zondervan
Yeah, those provisions are not specific to those institutions.
So, you know, theoretically anyone could take advantage of that provision, but they were particularly interested in those provisions because they do that type of long-term planning.
Elana Pirtle-Guiney
Okay, that's great.
That would be something that I think would be interesting to learn more about.
Thank you.
Mr. Revillapati, did you have something to add as well?
And I apologize if I I mispronounced your name there.
Rajeev Ravalapati
That's quite all right.
Kudos to you for getting it on the first try.
Um, what I was going to say, Councilmember, in regards to follow-up on Quentin's response, I, I believe I heard you ask like, um, how are hospitals or institutional buildings complying with BPS?
How have other jurisdictions with a BPS assuaged their concerns?
Um, okay, a couple remarks I would have to that is broad strokes.
So typically other jurisdictions address those concerns mainly through tailored compliance plans.
So really, we're offering greater flexibility within the bucket that is alternative compliance pathways.
Basically, an alternative compliance pathway is just an alternate to meeting the actual performance pathway or the performance target, and how ACPs are defined can be— can vary by the jurisdiction.
Also, jurisdictions have addressed these concerns by campus-wide accounting and specific allowances for critical operations.
So I guess 2 locations that I would cite as examples would be Seattle and Boston.
So in Seattle, how hospitals and institutions can comply is that district campuses can submit what they call customized decarbonization plans, and they're meant to deliver cumulative Emissions reductions equal or greater than the standard pathway.
And then eligible deductions include emergency generators, hospital emergency backup heat, or things like hospital laundry.
And the way that approach addressed their concerns, um, was that it accommodates central plans— central plants, I'm sorry— and phased capital projects while distinguishing those critical energy uses from ordinary building loads.
So essentially, Seattle also held focused hospital and laboratory and campus rulemaking meetings after they passed the policy and they moved towards the regulatory development.
They had additional stakeholder meetings, uh, and focused groups with hospitals, labs, and campuses.
Um, and then specific to Boston, um, same owner buildings can comprise a portfolio.
Owners may apply for like individual schedules, but there's also specific hardship plans and criteria that Boston has in place that addresses eligible technical or financial constraints.
So for Boston, they're allowing institutions to sequence investments across buildings and then seek like individual reviewed adjustments.
Elana Pirtle-Guiney
Okay, that's really helpful.
I think the allowances for, I think you said it was emergency operations or major operations, those backup systems is a really interesting thing to hear about.
I really appreciate that.
Rajeev Ravalapati
Yeah, the last thing I'll say about Boston is, and Quentin recognizes this given he used to be adjacent to Boston, But as we know, like Boston, Cambridge, Somerville, all, you know, Boston, the Boston area has a very strong healthcare district.
And so Boston created a healthcare district energy working group.
It's no longer active, but that working group was influential during the rulemaking process to help assuage some of those longer, those longer-term concerns that hospitals and So that is also— I think rulemaking is— stakeholder engagement is inherent to the next step after adoption, which is rulemaking.
And that's another opportunity where the jurisdiction can consider, like, a broad stakeholder engagement plan coupled with more narrowed working groups on specific property types who are going to have these more unique circumstances in order to meet the HART standards or the CHS standards, I should say.
Elana Pirtle-Guiney
Thank you.
That's really helpful.
And it sounds, in a few things that you have said and that others have said as well, like that stakeholder engagement and making sure we figure out how this can actually work and be implementable in different industries will be really important.
I'll also note that there's testimony submitted, or I guess not testimony, but a document submitted from the Office of Sustainability in the City of Seattle that notes that they ended up getting unanimous support in part because of a lot of groundwork that was done trying to figure out how to make the standards meet the needs of sustainability goals while also working for a variety of stakeholders.
So I'm taking note that that's an important part of the work that we will certainly need to continue to do as we move forward with figuring out the best way to do this in our city.
Thank you all.
I appreciate the answers.
I have a few more questions written down, but I'll pause here to make sure we have time for others as well.
Thank you, Chair.
Mitch Green
Uh, thank you, Chair Avalos.
Thanks for, um, leading on this policy.
Um, I think it's critical for our, uh, you know, sort of putting a stake in the ground.
Is Portland a climate leader or not?
You know, so I think this is a big piece of it.
I think you touched on something a little earlier.
You mentioned the kind of eligibility for certain energy efficiency grants, and I wanted to tie that together a little bit because in an earlier conversation— make sure I'm tracking this correctly— so Eco Northwest did some analysis on net impact to tenants in what year?
Vin Mason
The analysis started, I believe, at the beginning of 2024.
We might have engaged them in 2023, but it was completed in 2024.
Mitch Green
Okay, and so then, so that's a relatively recent, um, so that net impact to tenants, did that consider, I mean, what we would refer to as like warm rent, so rent plus utilities, or is it just rent?
Rent plus utilities.
Right, and that's probably why they found that there's no net impact is because over the long haul you see that this lowers their net utility bills.
So if they're seeing some upward rent pressure from the cost of upgrading the building, that's offset by the reduction in the utility bills.
Is that the right way to think about it?
Vin Mason
That is.
And there is a summary of their discussion specifically around naturally occurring affordable housing.
And to your point, the conclusion is that given this long compliance period, That owners would not readily recover their investments to comply, except in the case when it's well known by both the renter and the owner that utility bills have gone down.
And that goes back to what I was mentioning earlier, the ability to pay.
So if it's known that the tenant now has a heat pump that's saving them $50 a month, it's known by both parties, then that recovery of $50 a month could happen.
Thank you.
Mitch Green
Okay.
And when they did this analysis, did they look at, like, how did they estimate sort of— and I'm sorry, I'm getting like super technical, but how do they estimate like utility bills?
Vin Mason
Yeah, that's a great question, and it's a good technical question.
I don't have the exact answer for you at this time, but they worked with The cost estimator on the estimating the equipment costs for the reduction utility bills.
They also worked with ZGF in town, an architect, and they— I think maybe they provided that data to them.
Mitch Green
Okay.
We can follow up.
Yeah, that'd be helpful.
In a previous life, I used to be a load forecaster for a large utility, and the way that it works is, generally speaking, the utility plans based upon the peakiness of their load over the course of a year.
And so if you have climate change happening, you have a situation where Portland households have to turn on the heat more often than they used to, or, or turn on the air conditioning more often than they used to.
That increases what's called heating degree days.
Which then drives your peaks up.
And so if you've got a situation where building a code standard or sort of a standard like this sort of creates a regulatory cap on overall emissions, that's going to reduce those heating degree days and cooling degree days, and that's going to flatten out your load forecast.
And so I do think— I don't know if that went into that analysis, but I think that's sort of bullish for the case.
And also, there's probably a feedback loop whereby utility bills themselves get lower because the utilities don't need to do as expensive upgrades that they might have otherwise had to do in the absence of this policy framework.
So I think that there's— if we're not capturing that full cost and benefit picture, then I think we might be understating the benefits to all parties from the study.
And so I'll look for any details that maybe exist in the record.
Maybe you can help me find those between—.
Yeah.
Before this comes to a vote, but I'd be curious in stitching all that together for the rest of our colleagues who are not on this committee.
Vin Mason
Sure, that's a very good point.
And that is reminding me that it's not just the utility bill reductions because of higher efficient equipment, but also they looked at rates and assumed rate trends based on a certain timeframe in the 2020s.
Mitch Green
Yeah, I think this is a—.
Yeah.
And then of course, you know, I'm looking at the CIP for PCF right now.
There's just a number of opportunities to apply for these grants, uh, to offset these costs as well.
So, um, and you already mentioned that.
So, um, I think that's all I have.
Candace Avalos
Thanks.
Elana Pirtle-Guiney
Hi, thank you for being here.
Um, I have a question for our representative from the county.
Andrea, if that's possible, because oftentimes on this dais we're thinking about city-county collaboration more in terms of homelessness response, and I'm wondering if you can speak at all to how we can do— how we can be better partners on climate issues and if there are gaps or opportunities you see.
Andrea Hamberg
That's a great question.
I don't have an immediate answer for you, but I'd love to connect with your your team and talk more about opportunities upcoming.
Okay, to be brief.
Quinton Zondervan
Great.
Elana Pirtle-Guiney
And then I had a question, um, for Taryn, if that's okay.
Is that okay, Taryn?
Um, so I understand that, that you actually were part of the Build Shift Collective.
Tarren Evans
Yes.
Elana Pirtle-Guiney
That helped develop the climate and health standards for existing buildings And I'm wondering if you can speak a little bit to why it was important for community that the building performance standards were paired with tenant-focused policies in the proposal.
Tarren Evans
Yeah, thank you for that question.
So we, Build Shift, met over the course of, I believe it was like 2 or 3 years or so.
We had a lot of conversations with the team as well as several larger community convenings And that was a concern that we repeatedly heard, that people, of course, like, wanted their housing to be healthier, more efficient, but they were concerned about potential displacement.
And so that was something that we wanted to make sure was, you know, centered in this policy and that there were measures in there to mitigate potential displacement that could occur.
Elana Pirtle-Guiney
Thank you.
That's all that popped up for me for now.
Candace Avalos
Councilor Novick.
Steve Novick
Thank you, Madam Chair.
I think this question is for Ben and Andrea again.
There's something I forgot to ask, which I'm just intensely personally curious about.
I think your proposed carbon pollution impact fee is set at $380 per ton, and in my last job in this coalition of 120 lawyers from a bunch of different state AG's offices around the country, I was the social cost of carbon guy.
And the Obama administration, as you probably know, said that the cost that carbon imposes on the world is $50 per ton, which was obscenely low.
And then Trump tried to cut it to $7 a ton.
And then the Biden administration raised it to $190 a ton, which is better, but it still leaves out a lot of things they said they couldn't measure, like the cost of wildfires.
So I'm just curious how you got to the $380.
What factors do you look at?
Andrea Durbin
Andrea Jacob, for the record.
Councilor, I'd like to defer to Chair Avalos since that number did not come from BPS.
Oh, well, the reference did.
The reference, not the number.
The 380 did not come from us, but if you want to speak to the—.
Vin Mason
Yeah, so in the draft that we prepared based on the staff proposal, we looked at the social cost of carbon as one factor, but also other factors like but really importantly is, does this incentivize retrofits?
Is it high enough to incentivize reducing emissions?
Because the goal is not to raise revenue through fees.
The goal is really to get to zero carbon emissions.
So we shared an EPA resource that I believe all the other cities that have carbon performance standards also reference, or earlier drafts of it.
It's a 2023 EPA social cost of greenhouse gases.
Quinton Zondervan
Thank you.
Yes.
Vin Mason
In there, Table 4.1.1, you can see a variety of scenarios from 2030 to 2050 and beyond for different discount rates and a cost of carbon associated with each one.
So we refer to that as a great resource for the councilor's consideration.
And then as we referred it, we also noted that these utility discount— or the discount rate is essentially, how much do you value doing something about climate now versus having to deal with it later?
And so the higher value within that table is addressing those concerns earlier rather than waiting till later.
Steve Novick
Okay, that's music to my ears.
I mean, I think there's a strong argument for having no discount rate whatsoever because future generations matter as much as we do.
What the Biden administration did specifically was they dropped the discount rate from 3% to 2%.
Is what you're doing sort of reflect going below that and having it more like 1% or something like that?
Vin Mason
Similar.
I mean, so we didn't select any specific value, but as we shared the reference, the reference does have a range of 1.5% to 2% to 2.5% and then has a social cost of carbon for each of those discount rates.
And I believe it's the Thank you.
Steve Novick
By the way, just, uh, I have to let people know that using a 3% discount rate, which the Obama administration was using, and assuming the cost of human life is $10 million, which is what the US government currently says, under the Obama discount rate, um, an event causing the extinction of all human life 500 years from now would have been valued at $29 billion.
That's a lot of money.
Meaning it would be considered economically inefficient to spend $30 billion to prevent that.
And so that's the impact of these various— using different discount rates.
Thank you.
Candace Avalos
Good to know we've got some of that expertise on council we can tap.
Yeah, you guys can rattle off with that.
Okay, great.
I don't see any other folks in the queue.
We've got about 6 more minutes if there are folks that I want to hop in, um, and I can also make a couple of quick comments.
Um, yeah, ultimately I think where we're at is we, uh, did file the legislation at noon today so that it will be in on, um, during our October 20th meeting.
Um, I have informed you all about certain changes that we have made in recent weeks due to some, um, I think the biggest areas around alternative compliance pathways were what we've been workshopping.
And then ultimately, yeah, I'm looking forward to bringing that in 2 weeks.
I think that what I'm— what I've heard of the conversation here, I guess I would just ask if councilors have further questions, come chat with me.
If there are other concerns that might require a technical adjustment, I'm open to that.
And that's that's obviously something we can do to bring it back on the 20th if we need to make any further amendments.
I think that— and you kind of spoke to it, Councilor Novick— obviously there are lots of different questions that have come in that, you know, some of them are technical and some of them are policy differences that we're just not going to agree on.
And so I'm thankful, though, to the partners that I've been working with, and I've been very transparent with them about where I'm at, where I thought there were technical issues and where there were policy disagreements, including wanting an exemption of higher education, to which I don't agree.
And I've stated that pretty clearly, and I've shared my reasoning and have made a bunch of adjustments to address the concerns that have been brought.
But I think those are the ongoing questions that we have as we continue this, and we'll bring it on the 20th.
I see that I've got Rajiv.
Did you want to make a comment on something I said?
Rajeev Ravalapati
I did, Councilmember Avalos, and apologies if I'm butchering your last name.
What I just wanted to say was your comment about— I think I heard you say like potential adjustments or refinements to the alternative compliance pathways in the ordinance.
One thing I did not mention is with most BPSs, we have undertaken a federal project To standardize a framework for alternative compliance pathways.
And should— this project is a specific nod to— for a building owner who has— who manages large portfolios across multiple jurisdictions that have to comply with a web of BPS requirements.
Each BPS has a different ACP option.
So To try and standardize that and make things easier to comply for the building owner as well as make it more administratively feasible for the jurisdiction, we've developed a model framework for ACPs as well as regulations.
So this is more of like a direct nod to you and to Vin.
If there is more guidance or updates or refinements to the ACPs, IMT is more than happy to provide additional technical expertise.
Candace Avalos
Thank you so much for, uh, having your services available to us, and we definitely will be reaching out.
Um, Councilor Pirtle-Guiney, last word.
Elana Pirtle-Guiney
Yeah, thank you, Chair.
It sounds like you are hoping to move this pretty quickly through committee.
I know that you have had a lot of conversations, but for at least me, and I, I'm I'm assuming others at the dais, we're getting a lot of incoming from groups who are raising concerns, and we haven't been a part of that workshopping or those conversations.
That hasn't been done in a public, in this sort of way, setting, though I know you invited people to your workshop with me.
Are you planning to try to move this quickly that same day?
Yes.
Are you planning on this committee spending some time getting the details right?
And are you going to share with us transparently where you have made policy decisions so that we as a group of 5 can make sure that we understand those policy decisions and have the opportunity to weigh in on them as we move this policy forward?
Candace Avalos
Well, like any councilor who introduces legislation, of course, the goal is to share with you exactly the policy decisions.
This is policymaking.
So yes, I will plan to do that.
As far as what the outcome will be, I have not determined one.
It is scheduled for the 20th.
It's moving through the legislative process like everything else does.
If there are concerns that are raised that require a pause, I'd be welcome to that.
I have not heard any that require me to pause, so I feel like I've addressed everything I needed to address.
It's my policy, of course, but you all have your prerogative as councilors if you hear other concerns or you have questions or have proposed amendments.
That is part of the legislative process that we all follow.
So I don't see that being any different than what is already offered.
So unless there's something specific different that you're looking for, that's the process I'm planning to take.
Elana Pirtle-Guiney
I think I'm hoping to hear that we'll have time for that process in committee that day.
Candace Avalos
Well, I guess it just depends.
I don't know what people want to change, right?
As far as I'm concerned, right, we have this meeting, we have— we've been engaging with stakeholders If there are things that you think require more time, I have not heard of those things, so I'm open to that.
But I don't— I'm not going to give you a determination on what we're going to do on the 20th until I know if there are some kind of changes that are going to be astronomical that will require more time.
So again, that is what the legislative process demands.
I don't think I'm doing anything differently.
If you're asking a request for more time, please reach out to my office.
I'd love to hear what things you think deserve more time.
Is that understood?
Great.
Okay, we're going to go ahead and take a break for 10 minutes.
It is 3:50.
I'll see you at 4.
Thank you.
All right.
We are going to return at 4:02, 4:03.
Diego, go ahead and please call item 2.
Unidentified speaker
Item 2, document number 2026-346, amend property tax exemption for low-income housing held by nonprofit organizations code to extend the sunset date, replace code chapter 3.101.
Candace Avalos
All right, so the Nonprofit Low-Income Housing Limited Tax Exemption provides a property tax exemption for low-income nonprofit housing providers that develop and preserve affordable housing units.
The city needs to update current code to align with state law in order to continue providing this property tax exemption.
So I will go ahead and hand it off to PHB staff to tell us more.
Take it away.
Queesha Light
One second, sorry, got my computer was about to die on me.
Um, Okay, okay, maybe I can get it.
There we go.
Do you got it in there?
Okay.
Okay, wrong one.
I did, I'm in there, I just need to Get it to come up here.
Candace Avalos
Are we having technical difficulties or what's going on?
Queesha Light
No, I just— computer was on the— I had to do everything all the way over.
Sorry, because it was all shutting down.
There we go.
And let's get this in here.
One second.
Uh, there we are.
Okay, now I know, like, um, okay, we'll get to—.
We'll get through this.
All right, good afternoon, Chair Avalos, Vice Chair Green.
My name is Queesha Light.
I'm the interim director of the Portland Housing Bureau, and today, um, as noted, we are We are here to talk with you about the nonprofit limited tax exemption, or NPLTE.
We are bringing forward a rather simple request and change to essentially align with changes that were made in state code.
And I just wanted to say that the NPLTE has been a very significant way and a significant incentive for our affordable housing providers to be able to provide housing and maintain their operating costs within certain limits that keep housing affordable.
And Dori's going to walk you through just an overview of the program and the ask that we have in front of you today.
Thank you.
Dori Hellier
Good afternoon.
My name is Dori Hellier, and I manage The development incentives programs with the Housing Bureau, including the Nonprofit Limited Tax Exemption Program.
The city first adopted the program in 1985, and the Housing Bureau administers the program for the City of Portland according to the state requirements, and that supports the operation, preservation, and development of affordable housing.
The program provides a property tax exemption including both the land and building values for Portland properties operated by eligible nonprofit low-income housing providers.
Only the portion of the property serving tenants earning up to 60% of median income at the time of move-in, or 80% of median income in subsequent years, are eligible for the exemption.
Mixed-income buildings may still be partially taxable, and commercial spaces spaces are generally not included in the exemption as well.
Um, the program allows the exemption of taxes for property being held for, um, future development of low-income housing as well.
The Nonprofit Limited Tax Exemption Program requires an annual certification from eligible nonprofits updating the property and individual units that are eligible for the program each year.
And the Housing Bureau reviews these submissions and works with Multnomah County to apply the exemptions to each property account annually.
The exemption remains available on an ongoing basis as long as the state, city, and county continue to approve the program.
And compared to other exemption programs like the multiple unit limited tax exemption, which is limited in state statute to 10 consecutive years, For the current tax year—.
Let me go on to the next one.
Okay.
Oh no, sorry.
For the, for the current tax year, um, 67 different nonprofit housing providers operating over 700 properties are benefiting from the exemption.
The exemption supports more than 17,000 rental homes of all types, from studio apartments to single-family homes.
The program benefits both Housing Bureau-funded projects as well as those projects not receiving funding from the city but are otherwise restricted.
Projects only regulated by the Housing Bureau and not operated by nonprofit housing providers, such as those taking part in the city's Inclusionary Housing Program, generally receive a property tax exemption through the 10-year multi-program instead.
Projects operated by Home Forward benefit from another property tax exemption program that is specifically for housing authorities.
And with that, still over 75% of the PHB-regulated projects benefit from the nonprofit limited tax exemption program.
The program is an essential component to keeping families and individuals in their homes.
So as mentioned before, the state extended the sunset for the nonprofit limited tax tax exemption program to July 1st, 2033 through House Bill 2077.
The program currently is approved in city code through January 1st, 2027, and continuing the approval of the program is vital.
Without it, existing low-income housing will be in jeopardy, and it will impact the financing of both preservation and new construction projects.
This code amendment allows the nonprofit limited tax exemption program to continue by referring directly to the sunset date in state statute rather than stating a specific date, and meaning that the program can continue seamlessly as long as it is approved at the state level.
The code change also clarifies the purpose, procedures, and implementation of the program, making it consistent with other tax tax exemption code sections.
The County Commission also needs to approve the continued administration of the program after council approval, and we are coming now because we are seeking to have these approvals in place before the expiration of the program.
Applications for this next tax year are due in early in the first quarter of 2027.
And that, uh, is our presentation.
We're happy to take questions.
Candace Avalos
Thank you.
I believe we have some public testimony.
Yes, so let's do that and then we'll come back and take questions.
Thank you.
Go ahead and, Diego, call up our testifiers.
Unidentified speaker
We have one individual signed up Neil Whitaker.
Neil Whitaker
Respected members of the council, the Housing Committee, my name is Neil Whitaker.
I hope council saw the ProPublica article out about the financial ethics violation by the director of our state housing agency, because this is not what I'm bringing you today is not entirely unrelated to that.
You do have a vote coming up on extending the NPLT an additional 6 years, but I think the information PHB has just provided is at least a bit inadequate for you to make an informed vote.
PHB doesn't really show you that there, there are 2 distinctively different ways to qualify for this.
So we have nonprofits qualifying, and then what they didn't mention was that we also have for-profit that qualify.
And the data is unfortunately commingled, and I've been asking them for several months to separate out what the total dollar amount is for for-profits.
So we have for-profit entities qualifying for a nonprofit property tax exemption.
So how do they do that?
This is— it's in letter and intent, it's for entities that operate entirely within the 501 nonprofit tax arena in order to get this tax break.
So the city has kind of behind the scenes, they're giving it to a long list of nonprofits.
I think you should have the number of the for-profit entities that are getting this tax break and the total dollar amount and see if you want to parse that or, or not, because it isn't really accurate.
It's fine if you want to give it to all low-income providers, but that's not the name.
It's, it's named nonprofit low-income.
So these for-profit owners of low-income also get the entire long list of government funding sources and emergency bailouts as well.
They don't have to operate within the wider 501-type restrictions.
And that is unfair to nonprofits who have to line all that other stuff up to get the exemption.
And we have a compounded problem with our 60% AMI rents.
Our certified low-income rents are equal to market rate.
So now we've also made this unfair to the for-profit providers.
We've— I can't tell if you're coming or going with this tax policy.
So if I was an owner of a market-rate complex in Portland right now who was already accidentally naturally providing certifiable low-income rents.
I would just do what these essentially hedge funds are doing and tack on your tiny 501 at 1/200th of property ownership and get out of my $100,000 a year annual property taxes.
So this is, to me, this looks really outdated, really flimsy, and deceptive to the public because I can't really tell who you're trying to benefit here.
And I just think you should have the number of properties that are doing the token 501, the for-profits that are getting this, that number—.
Candace Avalos
Thank you.
You still have time.
You've got 30 seconds.
Neil Whitaker
What's that?
Candace Avalos
You still have 30 seconds.
Neil Whitaker
Oh, so you should separate out the for-profits because they didn't really mention that there's a way that for-profits qualify, and it's not the same.
This isn't an equivalent journey to get this tax break.
You just need 2 numbers.
And then you can make an informed decision how many properties and the total dollar amount that the for-profits are getting.
I've been asking them for that for 6 months.
I don't know why that was such a difficult—.
Sarah Radlett
Thank you.
Quinton Zondervan
Thank you.
Unidentified speaker
That concludes testimony.
Candace Avalos
Okay, um, let's go ahead and bring Housing Bureau back up for questions and comments from committee.
Um, Maybe I'll start by saying, what is your reaction to that testimony?
Because sounds like there's a question here of, um, whether there's a loophole, and I'm curious your reaction.
Queesha Light
So the reality is what we have is— I think what Mr. Whitaker is getting to, the MPLTE application doesn't require, or, or that the code doesn't say that we regulate a certain percentage of partnership.
It just says general partner, and the nonprofit has to be a general partner, and they have to operate the day-to-day responsibilities.
That's it.
It, it doesn't tell us to manage at a certain percentage level.
Um, and so we I think his concern is that you could potentially have a for-profit and a nonprofit partner, and the non— you know, there's a small percentage that the nonprofit is a partnership.
But that's not what we are required to regulate or, um, uh, I mean, or, or speak to in any way.
That is, if they meet the requirements, they meet the eligibility, then they are entitled to the incentive.
Neil Whitaker
Thank you.
Queesha Light
And we have— and I would say the other thing is this: much affordable housing being built is being built because of partnerships.
And so that incentive is there to continue to encourage those partnerships so that the affordable housing that we need gets built.
But I'll let you know if there's anything else you want to add.
Dori Hellier
Sure, I, um, I could also add just that the limited partnership structure is a, um, construct of the Low-Income Housing Tax Credit, um, program and how the majority of nonprofit-sponsored affordable housing across the country, let alone locally, is funded.
And so those partnerships themselves are not something that I don't think that we are seeing being put together strictly for the purpose of evading guidelines for the tax exemption program.
There are layers and layers of legal requirements and lawyers and funders and others looking at all of those documents as projects are financed and brought to fruition.
We do evaluate all of the corporate articles for every single application that is submitted and ensure that there is indeed a connection by an eligible nonprofit organization to the, the project, as is shown through a limited partnership agreement as one example.
Queesha Light
And might I add just one more thing?
I think if the nonprofit's role is substantive, and then that is they are doing the general day-to-day work And they are actually supporting, you know, low-income housing and residents, then the requirements for the exemption are met.
And I think that is, you know, we need to actually have to look at those questions.
That, that, that to me is the accountability question.
Candace Avalos
Okay, thanks for— I don't— I put you on the spot, but just figured let's get it out of the way and just see what's going on there.
Vice Chair Green.
Quinton Zondervan
Thank you.
Mitch Green
I was also getting in the queue to ask questions about this testimony that we heard.
Just to go a little further, so ORS, I think it's 307—.
Dori Hellier
Well, it's 307.540.
Mitch Green
Thank you.
That defines the state-level program, right?
Yes.
And it defines what what, you know, eligibility it looks like.
But then we also have code that clarifies and creates the program at the local level.
I guess the question I'm asking for is, are we bound by a certain interpretation by state law, or are we in city code saying, you know, a partnership is treated the same as a corporation, so on and so forth?
And do we not have regulatory—.
I'm sorry.
Do you have any authority to go further and maybe address this question?
Dori Hellier
We do, in our code that we're proposing, refer back to the guidelines as they are required at the state level for consistency across all of the other funding sources and programs that also designate limited partnership agreements in that same way.
So as not to interfere with funding of new projects.
So legally, the question is we can always add more detail to our code if we can demonstrate what the need is and why we're doing that and what the context and what the outcomes would be.
Mitch Green
Yeah, that's helpful.
Because I think for me, if the letter and intent of this is is to make sure that it's not for-profit firms that get a nonprofit tax exemption.
Although I understand that if it's some nonprofit that manages the thing on a day-to-day basis and delivers the thing, but how do we know?
Like, how do we know that just by having some sort of nonprofit in a portfolio So we're not skirting that and just providing a tax exemption for a for-profit entity?
Do we have any way of verifying that?
Dori Hellier
I mean, we, we do know that in properties that we have direct financing in, that the— and we can assume through the limited partnership agreements that it's the same for other properties— that the nonprofit is the one responsible for repayment of the loan.
The nonprofit is the one that's on the hook for the operation of these properties.
With the limited partnership agreement through the Low-Income Housing Tax Credit program, the corporation or the entity that is the for-profit one is benefiting by getting the low— the, the federal tax benefits to put money into the project.
So that's the benefit that they're already receiving.
The actual property tax exemption is a applying to keeping the operation of that particular building in, in place.
And so that's the way that we're evaluating the benefit of the exemption directly, you know, being for the nonprofit agency providing the low-income housing.
Quinton Zondervan
Okay.
Sarah Radlett
Do we—.
Mitch Green
I guess my next question would be, do we have, do we have the data to parse Is that the thing that Mr. Whitaker has asked for us to parse?
Dori Hellier
We don't try— with over, you know, that many units and that many properties, when we do evaluate, we do evaluate each and every ownership entity.
But in our current tracking system, we don't designate beyond whether it's a limited partnership or an LLC or a property owned directly.
So we don't go to the percentage of ownership or that sort of thing.
We just don't have that within our current records.
Mitch Green
But you do have some level of understanding of what the partnerships look like?
Dori Hellier
We do look at those.
Staff does look at every single partnership agreement, yes.
Mitch Green
Well, we would be able to get that information?
Dori Hellier
We would have to go back through every single application and weed through the exact percentage of ownership for every single one.
Quinton Zondervan
Okay.
Mitch Green
And you don't— that's just not work that the bureau has done to date, is that what—.
Dori Hellier
It's not something we track.
Again, we do look at it with every single application that we evaluate, but it's not something that we then record in a spreadsheet somewhere to say exactly what the percentage of ownership is for each property or ownership entity.
Mitch Green
Okay, so that's— it's not processed data that could be furnished in a timely fashion?
Dori Hellier
Yeah, it's not a benchmark that's part of qualification for the program.
It's strictly that there is a legal connection in the way as described in statute for the nonprofit organization to be a qualified okay.
Mitch Green
Uh, Director Light, how long would it take to, to furnish that, to build that data?
Queesha Light
The capacity for the team to go back through that at this time, and actually I think that's, that's just, that's going to take some months given everything else that's happening right now.
And I would really— I just want to make sure we're separating out what we're trying to do today to keep this exemption moving forward for those that need it to operate, and this question of, you know, do we need— of evaluating this issue, I think, are two— I just want to make sure we're separating those and keeping those very distinct because I think council can certainly legislate further around this issue, but to keep this exemption available to those that do need it to operate is, is really critical.
So, um, for us to do that, like I said, that's, that's going to take some months for my team to go back through all the documents to do that.
Mitch Green
Okay, that's helpful.
So, and you said earlier that this needs to be approved before the end of the year for folks to sort of go into the next tax year?
Queesha Light
Yeah.
Mitch Green
And there's nothing to prevent us from adopting code to regulate our forward-looking actions?
Queesha Light
No.
I mean, that would be something, you know, of course we'd have city attorneys tell you exactly where we could go with that and vet it, but there's nothing that keeps council from looking at adopting other eligibility requirements.
We would just ask that for today that that would be separated so we're not impacting those that do need it, because the reality is, um, they're— given the challenges that our affordable housing projects and units are facing right now, to take this away from some of them at a time when they're already struggling would not be a good thing.
Mitch Green
Okay, thank you for entertaining my questions.
Queesha Light
No, thank you.
Candace Avalos
Councilor Pirtle-Guiney.
Elana Pirtle-Guiney
Thank you, Chair.
I have 3 kind of separate questions, but I think I'll start with I'll start with the third because it goes down this path that Councilor Green was asking about.
I heard you say in your response to the gentleman who gave testimony and in your response to Councilor Green that the operating practice is generally that the nonprofit partner is the one who is running the property, running the building, and that the for-profit partners are investors in that property.
And I, I understand that if we were to ask for some sort of split in the future, right, a certain percent has to be owned by the nonprofit, that that could create challenges.
Where is that line?
What does that look like?
Would conceptually— and I'm not proposing this, and to be clear, I'm not proposing that we do this today, but it sounds like Councilor Green may walk down this path further in the future.
Would there be a challenge if we were to say that this program was available to housing where the primary operating partner is a nonprofit entity?
If we looked not at the dollars in, but at the roles.
Should I take that away from what you said previously, or is that— No, I think that's a fair point.
Is that using too blunt an instrument to parse this?
Dori Hellier
I'm not sure, Councilor, what effect that actually would have.
I mean, it's obviously something we'd need to look at, the specificity of the legal language and who that would include or exclude.
But ultimately, already we do have— it is limited only to nonprofit organizations that meet the few benchmarks, right?
And, and that is either they own the property outright, they are, um, have a leasehold interest in the property, or they are a general partnership of a limited partnership that then does operate the property.
So that is some— those benchmarks are already there.
Elana Pirtle-Guiney
It sounded like that third piece was maybe the question, and there was a question around how large a partner they were in that limited partnership.
And I think I'm, I'm trying to understand if there's an easy way to parse the difference between a, a small financial partner and the operating partner while you have many other partners who are in as investing partners.
And it may be that this requires more conversation.
I'm comfortable moving forward today and coming back to this, but I wanted to ask that question while we were I can clarify at least that part of our review of those operating agreements is—.
Dori Hellier
It's different in every single one, but we do look for the language that clarifies that the tax responsibility is borne on the nonprofit agency.
That's one of them.
We also look at they are responsible for the financial performance of the day-to-day operations and and so there it is said differently in every single agreement, but that's the general outcomes that we do verify in those documents so that the nonprofit is the one who's legally responsible for those things.
Elana Pirtle-Guiney
Okay, that's helpful.
I'd like to understand this more later.
I don't think I need to take the time today, but I do think that there are more questions that we should be asking about this.
In the presentation that you gave, I'm trying to find the number here, you had a slide that said of the 700 properties, 253 have a single low-income unit, 349 have 2 or more, and then almost 100 are vacant.
Are those properties with a single low-income unit single-family homes, or are those— okay, so these are not properties with mostly market-rate units and 1 or 2 or 3 rent single low-income units.
These are properties that are single-family homes, duplexes, smaller properties than, than our larger apartment buildings.
Tarren Evans
Correct.
Dori Hellier
We have properties that are for 1 family and we have some that have several hundred units in them.
Sarah Radlett
Yes.
Quinton Zondervan
Okay.
Elana Pirtle-Guiney
The way it was worded, it sounded like it could be a single unit in a larger building.
I wanted the chance to clarify that.
Thank you.
And my final question is that you talked in the presentation about the program itself, and you talked about needing this legislation to extend the date and make sure that we don't have to worry about changes every time the state makes a change.
That makes sense to me.
Yeah.
To me.
But when I look at the actual code in Exhibit A, which would replace 3.101 that's currently in code on the books, it looks like a complete rewrite.
And it has many of the same elements, but it's a complete rewrite.
And I have not been working in this policy area long enough to know if that complete rewrite is making any other substantive changes or not.
So can you spend just a minute or two walking us through what changes there are that we should make sure that we know about or that folks watching know about, since this is a complete rewrite of that section of code.
Dori Hellier
Thank you for the question, Councilor.
The reason for rewriting it is that the code was— has not been updated in any substantive way for many, many, many, many years.
And we have learned over the years that in this particular code, it's essentially parroting the state statute.
There are no additional policies or requirements really that are being outlined in the code.
And so in order to reduce the potential for inconsistencies between city code and statute, City Attorney's Office has advised it's easier and more straightforward to refer directly to the statutory sections that we are using to implement the program so that we don't have any conflict with how we operate the program at the local level.
Elana Pirtle-Guiney
I understand that piece of it, and on things like eligible organizations referring directly to the ORS, um, It looks like it's more substantive than that, and there are pieces in here that have a lot more language than that, exemptions that don't refer to ORS at all.
And there are pieces in the code now that are dropped.
So are the pieces in— is the rewrite more aligned with state code than what we have on the books right now?
And if So what provisions, if any, are we losing when we move to being more aligned with state code?
Help me understand with something that is different.
Dori Hellier
Yeah, it's actually—.
Elana Pirtle-Guiney
What the impact on the ground is.
Tarren Evans
Sure.
Dori Hellier
Actually, it's, it's not in an alignment to change any way that we operate the program.
But as an example, the current code refers to things that are included in the application, for instance.
And so that's restating things that are already stated in statute, and so it's not necessary for that level of detail to live within the code.
And if we wanted to even describe something further beyond what's in statute or code, it's something that could live in administrative rules, for instance.
And so it makes it for a much tighter process to just say, you know, we— the application requirements of statute and anything else that the city may require.
Elana Pirtle-Guiney
Functionally, this moves more authority out of code and to the bureau to define some of those things by rule.
It gives you a little bit more space to update the application without having to come back to us to have that changed in code, along with better aligning us to state code.
Dori Hellier
Correct.
Elana Pirtle-Guiney
I think that's important to note because we, we need to know that we are, in moving this forward, giving you all more authority to run this program without having to go through us every time.
Okay, thank you.
Thank you, Chair.
Candace Avalos
All right, seeing as no one else is in the queue and for time, because we have another time-sensitive item we must get done before 5, let's go ahead and move forward.
I'd like to entertain a motion to move the ordinance document number 2026-346 to the full council with a recommendation to pass.
Steve Novick
So moved.
Candace Avalos
Moved by Councilor Novick.
Do I have a second?
Seconded by me.
Um, clerk, please call the roll.
Unidentified speaker
Green?
Mitch Green
No.
Unidentified speaker
Pirtle-Guiney?
Elana Pirtle-Guiney
Aye.
Unidentified speaker
No.
Steve Novick
Aye.
Unidentified speaker
With 3 ayes and 2 nays, the motion to refer the ordinance document number 2026-346 to the full council with the recommendation it be passed is accepted.
Candace Avalos
Thank you.
And a note to the public, it's clear that there is some further discussion, policy discussion, that will need to happen.
Um, and so, uh, due to time, we need to move it out of committee.
And so these are requests from administration and from Council President because these have to come onto the, uh, council agenda for next week.
Same with this next one we're about to hear.
Um, that is why I'm choosing— I chose to vote aye and move it forward.
Um, but if there are, uh, amendments that need to get made, that can happen in the process at council.
Okay, with that, please item— please read item 3.
Unidentified speaker
Item 3, document number 2026-345, amend the Portland Zoning Code to bring it into compliance with Oregon state legislative bills passed in 2025 and 2026, amend Title 33.
Candace Avalos
All right, so this ordinance amends Title 33 to the city's planning and zoning code to ensure that Portland's land use regulations are in compliance with various Oregon state legislative bills that were passed by the legislature in 2026 and 2027.
So I will pass it off to staff to take it away.
Morgan Tracy
Thank you very much.
Good afternoon, uh, council committee members.
I'm Morgan Tracy, senior planner with the Bureau of Planning and Sustainability, here to present the Planning Commission's recommendation on the State Land Use Compliance Project.
Uh, with me is Eric Engstrom, our bureau director, who you already know, and Erica Thompson from the Planning Commission will present additional remarks following this brief presentation.
On June 23rd, the Planning Commission held a public hearing, received testimony from 3 individuals, discussed and deliberated, and ultimately recommended adopting the project report and amending the code to incorporate the proposals I will summarize for you today.
So today I'll provide an overview and context for the state legislation included in this project scope cover the project timeline, review the 13 proposals, and then hand it over to Commissioner Thompson.
So the project was initiated to update Portland zoning code to align with several state bills affecting housing and land use regulations passed in Oregon's 2025 and 2026 legislative sessions.
While there were many bills that touched on these topics, many did not directly impact zoning regulations or the city is otherwise already in conformance with them.
So the changes proposed with this project are necessary to ensure compliance and improve public understanding of how state rule changes will work together with Portland's zoning code.
For a little context, the proposals respond to these 5 key bills.
House Bill 2138 revises aspects of middle housing rules that the state passed in 2020.
Senate Bill 974 and House Bill 4037 streamline procedures for certain types of residential development proposals by limiting notice and removing some hearing requirements.
Senate Bill 1561 responds to challenges some faced when rebuilding their homes following the Labor Day fires in Detroit Lake by removing barriers to reconstruction when nonconforming dwellings are destroyed.
And finally, House Bill 2005 recognizes the need for having more mental health treatment facilities by requiring cities to allow them outright in more zones.
The project began in April and May with general informational meetings with stakeholders and advisory committees and commissions.
We typically begin our projects with a public discussion draft phase to test our proposals and seek feedback for improvement.
However, given the impending January 1st deadline for compliance, that more comprehensive engagement was not possible.
Consequently, the project the project scope was limited to items necessary to comply with state law, and a proposed draft of those changes was published in May.
The Planning Commission held their public hearing on June 23rd and voted to recommend council adopt these changes.
This project contains 13 proposals separated into 3 categories.
The first category addresses middle housing development regulations.
In general, these changes increase flexibility for middle housing development.
For example, by allowing any configuration of attached or detached units, removing lot size requirements that are any different than a house, and expanding where cottage clusters are allowed.
Offering bonuses for affordable units and accessible units, and making it easier to incorporate existing accessory dwelling units and duplexes into mid-housing developments.
The second category of changes affects the procedures used to review and approve proposed development.
These changes allow more flexibility for the timing of middle housing land divisions and offer a consolidated process.
Other changes limit notification areas to neighboring properties within 100 feet of a project site and remove the city's ability to notify for existing— or I'm sorry, expedited land divisions, including middle housing land divisions, as well as any application reviewed using clear and objective standards like an environmental plan check.
These changes are in order to reduce potential barriers or procedural slowdowns for residential development.
In addition, applications for zone changes and planned developments will no longer have a public hearing unless the case is appealed.
The final category of changes affects permissible uses.
These changes will allow residential treatment facilities, for example, mental health treatment for 6 or more clients, in single dwelling and industrial zones without the need for a conditional use review.
And the other change makes it easier to replace nonconforming dwellings in the cases where they are destroyed by natural causes like flood or fire.
Erica Thompson from the Planning Commission is here and will provide their remarks in just a moment.
Uh, the commission unanimously recommended the council adopt the project and report and code amendments As shown in the recommended draft.
Hello.
And just a little administrative detail before we finish up.
The supplemental record materials can be found here at this link.
So unless there are any immediately— immediate clarifying questions, here's Commissioner Thompson to share the Planning Commission's remarks.
Thank you.
Erica Thompson
Should I go ahead and get started?
Okay, great.
Well, good afternoon, councilors.
My name is My name is Erica Thompson.
I'm a member of the Portland Planning Commission.
I'm an architect at Hinneberry Eddy Architects here in Portland.
I'm a resident of District 3, and today I am pleased to represent the Planning Commission for the State Land Use Compliance Project that's before you.
We, on June 23rd, 2026, did vote unanimously to recommend that you adopt the project report and the proposed Title 33 amendments.
This really is, in essence, a simple compliance project in that the proposed changes are required by the state, but by adopting them into city code, we will promote regulatory clarity and consistency for developers and applicants.
The Planning Commission also agrees with staff and testifiers that the amendments will create a positive benefit for middle housing development, providing more flexibility and fewer barriers.
We heard from 4 individuals who provided a total of 5 pieces of testimony.
Testimony was supportive of the project.
It offered suggestions for ways to go further.
In fine-tuning the definitions and requirements for cottage clusters.
But ultimately, the commission felt that these recommendations to go further would best be deferred to a future project once the upcoming state rulemaking is complete and we can explore middle housing improvements more holistically.
We also received testimony asking the city to do more.
Yes.
To provide education and awareness of development strategies that promote accessibility and aging in place.
This is something we identified in our transmittal letter, and I wanted to highlight that there's a $500,000 fund through Oregon Housing and Community Services to support developers, service providers, and local governments in creating that education and awareness.
Thank you.
So while that's not directly related to the provisions of Title 33, we think it's a great resource and wanted to draw attention to it as something that could encourage adoption of our housing accessibility bonuses.
So thank you.
Candace Avalos
Thank you very much for your presentation.
And so we— I think we have some testimony, so why don't we take testimony, and then we can bring you back up if we have committee questions.
Queesha Light
Thank you.
Unidentified speaker
We have 3 individuals signed up.
First is Mary Wacker.
Once more for Mary Wacker.
All right, next is Kevin Balk.
Once more for Kevin.
Next up is Sarah Radlett.
Sarah is going to join us online in a few seconds.
Sarah Radlett
Good afternoon.
Can you hear me okay?
Steve Novick
We can hear you.
Candace Avalos
Go ahead.
Great.
My name is Sarah Rattley.
Sarah Radlett
I'm a land use planner in private practice since 2015, and prior to that, I worked for the City of Portland in current planning for 14 years.
So I have a lot of experience in implementing the zoning code.
And today I'm here to talk about specifically about the middle housing provisions that are in this, in this proposal to conform with the state rules.
And as noted, um, there's a lot of great stuff in there.
There's a lot of stuff in there that will encourage development, will encourage infill housing, will encourage small developments, small houses, um, those kinds of things.
So super, super exciting to look for those streamlined, um, changes.
Um, there are a couple things that I think would make it be more effective.
One is that specifically about cottage cluster developments, which are multiple detached homes.
On lots, it's a newer in the last several years kind of middle housing piece.
One of the changes that's being proposed with this project is to increase the minimum size of a common area from 450 square feet to 750 square feet.
And the reason that that is impactful is that you have kind of a couple different regulations directing the amount of common area.
One is.
Typically 200 square feet per unit.
So if you have 6 units on one, say, 10,000 square foot lot, that's 1,200 square feet of common area required.
Under the new rules, you would have one common area that has to be at least 750 square feet, which gets you, you know, 3/4 of the way through your minimum.
And then you need 350 square feet more.
But if you can't fit that in that one contiguous common area, then now you need another common area, which is typically fine, but that second common area also has to be 750 square feet instead of what is current, the current rules, which are 450 square feet.
So, the result is potentially, when, especially when you're working around an existing house and your site is constrained in some way, that you're not going to be able to necessarily have one common area, and you're going to end up with multiple common areas.
And the problem with that is that that then either means fewer units or smaller units for this kind of excess extra common area.
So I would propose that if, if the intention is to increase the minimum common area to 750 square feet, have that be for one common area, and then any additional common areas could be 450 square feet in area.
Thank you.
Councilmember Herbold?
It's a, it's a simple code fix consistent with, um, what's been happening in the past.
And then really quick, because I'm almost out of time, my second, um, comment has to do with parking and how parking will be differently regulated for a fourplex of attached units or 4 units of detached or mixed.
So there's 2 different code sections that would regulate those, and it will be confusing for applicants and everyone to Thank you.
Elana Pirtle-Guiney
Councilor, would you be willing to let the testifier explain that second point even though their time is up, since we don't have anyone else signed up to testify?
That's fine.
Thank you.
Sarah Radlett
Um, great.
Thank you so much.
Um, so currently the rules For parking, there's, there's kind of, there's 2 sections of rules for parking.
One is for houses, duplexes, triplexes, and fourplexes, and that's one set of rules.
And then, and that, so that's the driveway.
So maybe you have like a cottage cluster project where you drive onto the site with a shared driveway, and then everybody has their garage or a common parking area or something like that.
That's, that's kind of the scenario that we're talking about.
Um, and then you have another section of code that's all other development.
Okay.
Right.
And that all other development, as staff would probably speak to, hasn't really been looked at in depth for middle housing and cottage clusters and such.
But it's going to get kind of even worse now, because if you have a fourplex that is attached units, 4 units attached, you fall under the first code.
But if you have 4 units that are maybe 2 of them attached and then a space and then 2 of them attached, now you fall under the other code.
Right.
So they're almost identical developments, but they have very, very different parking regulations.
So I would propose that the codes be labeled 1 to 4 units is the first section, and the second section is 5 and above units.
And it would fall in line with how the code is implemented currently, so it wouldn't be a big change for any of the implementation, and it would clarify you know, it's just going to be weird if, if we're explaining to people like, well, if you attach your units to each other all, then you follow these regulations for your driveway.
But if you want a break in that attachment, now you have to follow these different regulations.
And, and people are just going to be like, that doesn't make any sense.
So that's— those are my 2 top, uh, kind of requests for change that I think are simple enough to be tweaked in the code without okay, thank you for the additional comments, Sarah.
Candace Avalos
We appreciate your time.
Thank you.
Uh, let's get into it.
Sarah Wallach
Councilor—.
Elana Pirtle-Guiney
Vice Chair Green.
Mitch Green
Thank you, Chair Avalos, and I've got my eye on the clock here.
Um, I just wanted to ask, uh, really quickly, Whether that last testifier's suggestions are things that the Planning Bureau could, could think through and accommodate before we were to bring this to the City Council, is that a thing that we could contemplate?
Morgan Tracy
We, uh, we appreciate the, the input, uh, and suggestions that Mr. Adelaide has provided in the past.
As I explained earlier, we were faced with a dilemma.
We could either take the time and think thank you.
I think we need to think more holistically about our middle housing development standards or address the state mandates before this January 1st compliance deadline.
The change to the open space requirement, not too difficult to accommodate if we just don't make the amendment that's proposed, just keep it at 450 square foot as it stands today.
That's an easy change.
The parking gets a little more complicated.
The parking standards were developed with the notion of a single structure, a single primary structure, and where you put your driveways and garages around that.
When you move into what's called multi-dwelling development, when you start separating those units up, there's a number of different types of kind of considerations that need to be thought through and addressed.
And it's not a— as you can imagine, when we talk about parking, it's not always a simple kind of there are lots of impacts that we need to consider.
So with that frame in mind, again, we think that the direction is right.
We think that looking at more even standards for all types of middle housing is sensible, but we also think we need to take the time to make sure we do that right rather than just try to apply the standard that was designed for a different type of product onto, onto appreciate that.
Mitch Green
Um, I would be curious to see what that first tweak could look like.
I don't know that I, I want that little of common space, but, um, I'm curious to see what you guys can come up with.
I understand you guys are also doing a lot of other work.
So, um, my last question is then, if we were to sort of move this forward even as is and adopt this, meet the requirement, would we be able to tweak this down the road?
Morgan Tracy
We are anticipating— we actually have a project queuing up to look at facilitating middle housing development and a number of other tricks up our sleeve in terms of how we address development in the currently labeled single dwelling zones and thinking about those standards and making them work more effectively both across single dwelling and multi-dwelling zones.
So as developers are looking at sites, they are not forced with the sorts of dilemmas that Ms. Radley raised, which is you have this kind of standard in this zone and a different standard in this zone, same product, same look at the end, but you have to sort of jump through different hurdles.
So part of our objective with that other project is to look again more holistically at all those requirements together.
Mitch Green
I appreciate that.
Thank you.
I'm prepared to move this today.
Candace Avalos
Councilor Pirtle-Guiney.
Elana Pirtle-Guiney
Thank you, Chair.
Um, it makes sense to me that the parking needs a, a deeper look.
There's a lot that we touch with different parking requirements in the city.
The first comment that the testifier brought up about having a requirement for 750 square feet of common space, but the additional common space areas around a property could be smaller, still keeping that 450 minimum so that they're not— so that they're usable, but so that we don't encroach on the space needed for housing.
Makes a lot of sense to me.
I understand that the intent with what we have before us is to just move forward what is required by state law.
I'm happy to move forward with what we have but I wanted to raise that because it sounded like you were suggesting we could move back to the 450 minimum, and I would hope that we don't do that.
I would hope that we keep the 750 minimum for a larger common space area, but consider having some smaller minimum for secondary common spaces where there are multiple common spaces within the same developed area.
Morgan Tracy
Appreciate the clarification.
The direction.
I think the dilemma that we're facing with that, reverting to the standard that's in place today is basically that we would just give direction to omit that amendment from the package.
So basically not change the standard.
If we're talking about creating a sort of bifurcated standard where you have an initial 750 square feet followed up by something that's smaller, we'd have to kind of craft what that language looks like.
Which I'm not really prepared to do on the stand.
Elana Pirtle-Guiney
I would be comfortable with that being part of future work that you're doing and not addressing that today and moving this forward.
I think that the testifier raised some very legitimate points.
I just don't want us to overcorrect in the other direction by moving back to having only those smaller common spaces in our multi-building developments.
Understand.
Thank you very much.
Candace Avalos
All right, seeing as there's no one else in the queue, last call.
Then I would like to entertain a motion to move ordinance document number 2026-345 to the full council with a recommendation to pass.
Mitch Green
So moved.
Elana Pirtle-Guiney
Second.
Candace Avalos
Moved by Vice Chair Green, seconded by Councilor Pirtle-Guiney.
Uh, clerk, please call the roll.
Sarah Wallach
Aye.
Aye.
Aye.
Unidentified speaker
Novick, absent.
Avalos?
Candace Avalos
Aye.
Unidentified speaker
With 4 ayes and 1 absent, the motion carries, and the ordinance document number 2026-345 moves to the full council with the recommendation it be passed.
Candace Avalos
And the State Land Use Compliance Project is continued to a full council meeting on October 14th at 9:45 AM, time certain.
Thank you.
Thank you.
Uh, right, with that, um, like I said, next meeting will be, uh, the Climate and Health Standards Policy, and there will be public testimony and committee discussion.
For now, I will adjourn the Housing and Permitting Committee meeting at 4:58 PM.