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Committee hears bill to allow local improvement districts inside urban growth boundaries
Summary
A House committee took public testimony on Senate Bill 967, which would clarify that cities and counties may use local improvement districts (LIDs) on unannexed land inside urban growth boundaries through intergovernmental agreements to finance infrastructure for housing and employment lands.
The House Committee on Housing and Homelessness held a public hearing April 16 on Senate Bill 967, which would explicitly allow cities and counties to establish local improvement districts inside urban growth boundaries on land that has not yet been annexed, using intergovernmental agreements to allocate jurisdictional authority.
The bill’s sponsor in the Senate, Anthony Broadman, said the change “removes uncertainty and it gives local governments and landowners a clear tool to fund infrastructure improvements” and argued that LIDs help “accelerate infrastructure development in areas slated for annexation.” The bill passed unanimously out of the Senate Housing and Development Committee.
Supporters told the committee the measure is intended to unlock site-ready housing and employment land by allowing municipalities and counties to coordinate financing for roads, sewers and other urban-scale infrastructure before formal annexation. Eric Chancellor, speaking for the city of Bend, said UGB expansion areas can involve many small landowners who lack experience in financing public works; Jenna Jones of the League of Oregon Cities explained that LID assessments are typically calculated by a formula tied to benefit and that cities require majority approval from affected property owners (thresholds vary locally). Morgan Greenwood of the Central Oregon Builders Association and Sarah Odenahl of the Bend Chamber of Commerce also testified in support, saying infrastructure costs are a major barrier to workforce housing in their region.
Committee members pressed on procedural and legal specifics. Members asked which jurisdiction’s approval thresholds would apply when city and county rules differ, and who would carry debt for improvements financed before annexation. City representatives said intergovernmental memorandums of understanding (MOUs) would mirror other multi-jurisdictional practices and that LIDs retain public notice requirements and a willing‑landowner requirement; Jenna Jones said thresholds fluctuate by city (one example cited: Albany requires roughly an 80% property‑owner buy‑in; other places typically fall in a 70–80% range). The city of Coburg was cited as an example where an LID financed a wastewater system with assessments repayable over 10 years at about 6% interest.
Central Oregon Land Watch supported the bill after a dash‑2 amendment addressed its concerns about preventing premature service provision that could lead to exurban development; Corey Harlan said the amendment sufficiently addressed the group’s issues.
No committee vote was recorded during the hearing; the bill advanced from the Senate committee with stated minimal fiscal impact and no revenue impact.
Looking ahead, supporters said the change is intended as a narrowly tailored tool to reduce upfront costs and speed infrastructure delivery in UGB expansion areas while preserving public process and notice requirements.
