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Milwaukie council probes states middle-income revolving loan program, asks staff for more study
Summary
Council members reviewed recent state rulemaking and a House bill on the middle-income revolving loan (MERL) program, raised questions about administrative capacity, fiscal exposure and county coordination, and directed staff to gather questions and return with analyses at a May 5 work session.
Milwaukie City Council members spent the bulk of their March 17 meeting reviewing the states middle-income revolving loan (MERL) program and asking staff for more detail before deciding whether to adopt an originating ordinance that would allow projects in the city to use the program.
The council president summarized recent changes to state guidance and a House bill, saying the states rulemaking "allows for jurisdictions to provide the funding for the property tax deferral through other means," and that the legislation "requires an affordability covenant on all these projects" and permits jurisdictions to levy "a 20% fee for non-compliance." The council president said those changes address concerns many cities raised about enforceability.
Why it matters: MERL can lower the effective cost of building middle-income and affordable housing by deferring taxes tied to new improvements, but it also raises questions about who administers long-term covenant compliance and which taxing districts lose revenue when an increment is waived. Councilors repeatedly pressed staff for clarity on the programs mechanics, the citys legal and…
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