Senate Bill 967 clears committee to support local improvement districts for housing

The Senate Committee on Housing and Development convened on March 3, 2025, to discuss significant legislative measures aimed at addressing housing challenges in Oregon. Two key bills were at the forefront of the meeting: Senate Bill 967 and Senate Bill 1095, both designed to enhance local governance and address housing shortages.

Senate Bill 967, introduced at the request of the city of Bend, seeks to empower local governments to form local improvement districts (LIDs) within unincorporated areas of urban growth boundaries. The bill includes a dash 2 amendment that allows for agreements on improvement districts that have not yet been adopted, ensuring that any local improvements align with the comprehensive plans of the cities involved. This legislation aims to facilitate the development of public infrastructure necessary for unlocking housing potential in areas that are currently underutilized. The committee unanimously adopted the amendment and recommended the bill for passage to the floor, highlighting its potential to alleviate housing shortages by enabling local governments to collaborate more effectively.

In addition to SB 967, the committee reviewed Senate Bill 1095, which authorizes cities and counties to impose fees on non-commercial residences that remain vacant for over 180 days in a calendar year. This bill, proposed by the mayor of Sisters, Oregon, aims to address the impact of second homes on local housing markets. Senator Broadman emphasized the need for local governments to have the flexibility to impose such fees to mitigate the burdens created by vacant properties, particularly in amenity-rich areas where housing demand is high. The bill is intended to provide cities with a tool to analyze and address the effects of second homes on housing availability and affordability.

During the discussion, stakeholders expressed varying opinions on the necessity and implications of these measures. Jenna Jones from the League of Oregon Cities noted that while there is support for a second home tax, the actual revenue generated and its impact on housing needs remain uncertain. She cautioned that such fees could inadvertently lead to properties being converted into short-term rentals, complicating the housing landscape further.

The committee's discussions reflect a growing recognition of the complexities surrounding housing development in Oregon. As local governments seek innovative solutions to address housing shortages, these legislative efforts represent a proactive approach to fostering collaboration and enhancing local governance in the face of pressing housing challenges. The next steps will involve further deliberation on these bills as they move to the floor for broader legislative consideration.