The problem

Housing cost is regionally driven. Therefore, to achieve a future where safe, affordable housing is located close to quality jobs, schools, and parks, all communities must provide their fair share.

The laudable goals of Portland’s Residential Infill Project, and Wilsonville’s history of providing “missing middle” housing types, will not achieve affordability goals unless there is a change in communities who have been resistant to affordable housing development.

Without action, those who will bear the greatest burden are non-white people, fixed-income seniors, people with a physical or mental disability, lower-income workers, and single-parent families.

HB2003 & OHCS RHNA, a looming giant

Holy acronymony! Stick with me for a minute as I do my best to translate this super wonky topic that could have a major impact on getting affordable housing in resistant communities.

Directed by HB 2003, the Department of Oregon Housing and Community Services (OHCS) will be developing a Regional Housing Needs Assessment (RHNA) for each of Oregon’s cities (241 to be exact) and the Portland Metro.

The regional need will be projected and analyzed (household income, housing type, race/ethnicity, disability status, family status and size, people experiencing homelessness, and seniors), then equitably distributed to establish housing targets for cities and Metro.

This analysis will closely follow California’s RHNA process, which has been criticized (see UCLA Issue Brief and Central City of Los Angeles White Paper) for its lack of enforcement and ability to be politically manipulated. To address these critiques, in recent years California has coupled higher affordable housing targets, which the San Diego region is challenging in court, with preemption actions to streamline local land use and housing permitting. OHCS contracted with ECONorthwest to complete this work, and the report is due to the Oregon legislature by September 1, 2020.

This is important because measuring need and setting targets are essential to (1) changing the massive structures that guide housing in Oregon, and (2) getting communities to provide their share of affordable housing.

Call to action

OHCS is receiving public comments on its RHNA process until January 31. This is one of two opportunities for public input, the latter being at the end of the study in September. I highly encourage you to leave a comment by emailing Kate Srinivasan, OHCS Research Analyst, at RHNA@oregon.gov. Commenting is FREE, so be sure to do it today!

If you have 10 minutes, keep reading as I provide a detailed overview and analysis of the OHCS RHNA scope of work.

OHCS RHNA: Overview

Although HB 2001 has received the major news coverage, HB 2003 may be just as important in solving Oregon’s housing crisis.

Estimate housing stock for each city and region
Calculate housing shortage for each city and region
Estimate the number of housing units necessary to accommodate anticipated growth over the next twenty (20) years for each city and region, broken out by housing type and affordability

Housing types:

Single-family, detached
Duplex or single-family, attached
Multifamily
Manufactured and mobile

Housing affordability, by a percentage of Median Family Income (MFI):

Extremely low = below 30% MFI
Very low = 30% to 50% MFI
Low = 50% to 80% MFI
Moderate 80% to 120% MFI
High = 120% or more

The regional need will be projected and analyzed (household income, housing type, race/ethnicity, disability status, family status and size, people experiencing homelessness, and seniors), then equitably distributed to establish housing targets for cities and the Portland Metro.

Additional factors studied, but may not have a target, include the following:

People experiencing a housing shortage
Renter and homeowner mix
Transportation cost included in how “cost-burdened” is defined
Availability versus demand – government-assisted and naturally occurring affordable housing

This process will closely follow California’s RHNA, which has been criticized (see UCLA Issue Brief and Central City of Los Angeles White Paper), for the following reasons:

Lack of enforcement for those who did not meet affordability targets (only 24 of California’s 540 jurisdictions met RHNA goals).
Ability to be politically manipulated, since each region defines how housing need will be distributed.
Projections were underestimated, leading to a backlog of housing needed to balance the market and provide affordable options.
Since projections were based on historical population and growth, the targets call for more housing in places where prices are lower, not where it is most expensive (prices are higher due to a history of restricting housing).
It does not capture the need to provide housing close to work, which is a major factor in maintaining access to stable income, reducing transportation costs, and lessening environmental impacts.

To address these critiques, in recent years California has coupled higher affordable housing targets, which the San Diego region is challenging in court, with preemption actions to streamline local land use and housing permitting.

A final report is due to the Oregon legislature by September 1, 2020.

OHCS RHNA: Analysis

OHCS contracted with ECONorthwest to conduct the RHNA. Previously, I wrote about my admiration for ECONorthwest’s work and proposed critiques to better capture equity needs in their housing analysis.

Two thumbs-up

In reviewing the RHNA scope of work, I give the following aspects two confident thumbs-up:

An impressive amount of work has to happen in a relatively short amount of time (final report due by September 2020).
Raises all of the pertinent questions in Task 4.1. An item close to my heart is projecting wages, which the scope identifies as a possibility – at least for jobs – by using Oregon Employment Department data.
Interested to hear what OHCS learns from the California RHNA literature review and feedback from the panel of experts with experience in California.
Agree that a hybrid of California’s RHNA will be necessary because of population differences and data sources, a desire to establish consistency in regional allocation and HB2003 directs Oregon to study different factors, especially with affordable housing.
Including transportation in housing affordability and cost-burdened is an excellent addition, as it better represents the true cost of living.
The study of people who are experiencing homelessness, the potential inclusion of adjustment for overcrowding, and review by OHCS homeless services and affordable rental housing staff, are all positive steps to address gaps in Goal 10 HNAs for temporary and transitional housing.

Opportunity for improvement

Based on the critiques of California’s RHNA process (see UCLA Issue Brief and Central City of Los Angeles White Paper), and my analysis of the Clackamas County HNA, the following are opportunities for improvement:

Housing projections and equity allocations should go beyond historical population and development patterns to ensure that housing options are provided in expensive markets and in job-rich communities. This could be accomplished through the following:
(a) Include the calculation for the shortage of units, described in Task 2.3, in future housing need to address the backlog of needs.
(b) To ensure that all communities carry their share of the burden, it could be required that every city provide a minimum of 10% of their housing stock as income-restricted.
(c) Use market informed factors, such as target vacancy rates which stabilize housing prices (7-8% rental and 3-4% owner), as inputs in determining housing need projections.
Unless cities want further state preemption, they should be ready to be held accountable for meeting RHNA projections, especially for low-income homes. From the lessons learned in California, this study should consult with cities to propose measures for not meeting RHNA targets.
Housing targets by type should encourage the development of affordable housing with multiple rooms, in addition to small single-room units, to address the need for families and multi-generational housing.
Temporary and transitional housing should be included in the equitable distribution under the multifamily projections. A source for data is the OHCS Statewide Shelter Study.
The OHCS RHNA should be used as a blueprint to reform the Goal 10 land-use system analysis. The housing production strategy could contain incentives for meeting or exceeding RHNA targets, and remediation for not.
To understand the true impact of inequality in Oregon’s housing market, the project methodology should first and foremost identify the full housing need. The housing production strategies could identify near-term actions for jurisdictions to fund and accommodate needs.
This might be a typo, but “extremely low income” is included in task 2.1 categories, but not listed in part 1 overview.

Congratulations!

If you made it this far you MUST take another minute to comment by emailing Kate Srinivasan, OHCS Research Analyst, at RHNA@oregon.gov before January 31!