Think Out Loud

Medford and Astoria face critical housing needs

By Elizabeth Castillo (OPB)
April 18, 2022 4:47 p.m.

Broadcast: Monday, April 18

Astoria, Oregon.

Astoria, Oregon.

bowers8554/Flickr

THANKS TO OUR SPONSOR:

A contentious proposal to build housing in downtown Astoria is no longer moving forward. Meanwhile, a workforce housing project in Medford continues to advance. We learn more about what comes next and how each city plans to navigate the housing crises they face. Bruce Jones is the mayor of Astoria. Harry Weiss is the executive director of the Medford Urban Renewal Agency. They join us with details.

Note: The following transcript was created by a computer and edited by a volunteer.

Dave Miller: This is Think Out Loud on OPB, I’m Dave Miller. We start today with two conversations about affordable housing in Oregon. In a few minutes we’ll hear about a new development in Medford that’s going to be breaking ground next month. But first we begin in Astoria, where a contentious proposed development right in the middle of downtown, one that we talked about recently on this show, is now dead. Bruce Jones is the Mayor of Astoria. He joins us to talk about what happened and where the city goes from here. Bruce Jones, welcome to Think Out Loud.

Bruce Jones: Thanks for having me Dave, good to be here.

Miller: It’s good to have you back on. So last month, we talked with some folks about the Heritage Square site, and the affordable and supportive housing proposed there. But for folks who missed that conversation, can you just briefly remind us what the idea was?

Jones: Yes. Well to set the context, Astoria is facing a housing crisis crossing socioeconomic boundaries, and a number of factors have converged to exacerbate this crisis locally. The tremendous rise in construction material and labor costs, the labor shortage, an influx in Astoria of second home owners, of remote workers and retirees that are driving up the cost of our existing housing stock, and frankly the increasing desirability of Astoria as a place to live because of our unique character: our waterfront, our quality of life and our historic homes. And we find ourselves facing the same situation that many of these mountain towns, like Telluride and Silverton Colorado have faced, where the bottom half of our wage earners are being squeezed out of the ability to live where they work.

Heritage Square is a city block downtown which features a parking lot, a large fenced off hole in the ground where there once was a grocery store. Because the block is hollow underneath, it’s very challenging and expensive to develop. And our city council has said for about five years that the best and highest purpose for this property is workforce housing. So we put out a request for proposals last fall. We selected one of two developers who submitted proposals to work with. The initial proposal was for a combination of a small four story building with 33 units of permanent supportive housing at 30% of the area median income. That would be run by our county’s mental health care provider. And then there was a larger four story building with between 55 and 75 apartments targeting people making up to 80% of area median income, and averaging 60% area median income. And the reason for that income formula was to make the project eligible for funding through state LIFT funding, and also federal low income housing tax credits.

We held a series of public meetings and open houses, as a result of which the developers took the community input, and they modified their proposal. So it was finally one, four story building, including the 33 units of permanent supportive housing, as well as another 64 apartments that were targeted at folks making up to 80% of the area median income. And in Astoria, just under 80% of the area median income means beginning schoolteachers, EMTS would have been qualified to live in this building. And because of our historic downtown, this was a project that was going to be designed by a local architect in consultation with our city historian, to ensure that it would be compatible with our historic downtown architecture.

And not surprisingly, as with all affordable housing proposals, there was what we’ll call a NIMBY response: “Hey, we support affordable housing, but not here. It might take away too much parking. The tenants are not the right socioeconomic class for this part of town. It could drive property values down. It will increase crime.” And to be sure, there are good legitimate arguments that reasonable people made to disagree on whether or not this project in this location was the right thing for Astoria. There are people who want a parking garage instead of housing, and that’s a legitimate concern. There’s a group that wants to turn the block into a European style plaza or amphitheater. There are those who want market rate housing there, or short term lodging, because that would bring more affluent people to downtown to spend money.

But, kind of uniquely with this project, we saw from the beginning there was also a misinformation campaign against the proposal. There were claims that no Astoria workers would qualify to live in the building, that it would attract freeloaders from around the country who don’t want to work. We had prominent members of our community referring to the proposed building at Heritage Square as a future slung, as a ghetto, as a Cabrini-Green, as a big box monstrosity, as the death of downtown, and even as the most destructive change to Astoria since the fire of 1922, which you might know, burned down the entire downtown.

Miller: So this was some of the pushback, but nevertheless, you were among the folks who supported this idea, who voted for it to go forward. But then a few weeks ago, there was a unanimous vote to kill it. So what happened?

Jones: So ultimately, the final piece of the puzzle as we move through an open process to streamline or to fine tune the building design and come up with the right income mix and the right building footprint, the final piece was the financing part. And ultimately, the developer was going to require the city to give the property away, to have 60 years of no property tax, and to use up our entire urban rural fund of $2.25 million dollars. And that cost, combined with community opposition, just made it unsupportable. In my judgment, moving the project forward at that point would have been a distraction for the rest of the year that would have prevented us from making progress on a number of other housing initiatives. So the council unanimously elected to end its involvement with the Heritage Square proposal, and immediately move on to other housing efforts, of which we have several.

Miller: So let’s turn to some of those, including some that the county is involved in. Clatsop County has asked for proposals from developers or non-profits for their ideas and what to do with 15 different county owned parcels of land, eight of which are in Astoria. What are some possibilities for your city?

Jones: Right. So those lots will be offered to any non-profit or governmental agencies that can put affordable housing, child care, or social services. We’re very hopeful that those lots could be used for affordable housing. Additionally, we have the Owens Adair building, which is senior affordable housing run by the Northwest Oregon Housing Authority. They have just announced they’re putting in an application for LIFT and low income housing tax credits to build a significant expansion to their downtown facility, which would provide 50 additional units of senior affordable housing, 50% at 50% of the area median income, and the other 25 units for seniors in transitional housing, either dealing dealing with disabilities or coming out of homelessness. That would be at 25% of the area median income.

And then finally, the city is moving forward on looking at code changes to allow increased density, reducing the minimum lot size, increasing maximum lot coverage. Beginning Thursday, we’re holding a series of four community meetings to discuss the whole variety of options available to the community, to give our citizens more information about how to develop ADUs for example, to look at the missing middle, with cottage clusters, with duplexes and triplexes, with converting downtown buildings whose upper floors are not used into residential spaces, for example.

So I think there’s a lot of opportunities to increase Astoria’s housing units, and it’s going to come both from larger projects, and then smaller things like infill if we can get those code changes implemented.

Miller: And some of those smaller projects, those have been changed by or made possible by zoning changes statewide. But based on what happened with the Heritage Square site, do you think there’s a reason to believe, in terms of larger developments, that putting affordable housing or supportive services, say, for behavioral health, putting those in other sites is going to be an easy lift?

THANKS TO OUR SPONSOR:

Jones: It won’t be an easy lift. I mean, every affordable housing project faces some resistance from whatever community it’s in. But this particular site, we worked on the hardest project first. Heritage Square was the tough one. It’s a tough block, and it’s also a block that a lot of people wanted to keep as open space, even though there’s no funding to turn that into the park that some people want. So I’m hoping a lot of the resistance, people have worked it out of their systems on Heritage Square, and that there will be support for the Owens Adair expansion for using these county owned lots for affordable housing, and for making the code changes necessary to allow greater density in some of our neighborhoods.

And you know, we’ve heard some concerns from some people that if you allow greater density, you’re changing the character of Astoria’s neighborhoods. But I would argue that we’re already seeing the character of Astoria change because we’re becoming less of a working class town that we’ve always been, and more of a place that only expensive out-of-staters and wealthier individuals can afford to live in. And if we’re no longer a working class town, if we no longer have what they call the “pretty but gritty” character, if we no longer have the gritty, we only have the pretty, we’re not really Astoria anymore.

Miller: Bruce Jones, thanks for starting us off today.

Jones: Thank you.

Miller: We go from the north coast to the Rogue Valley right now. Harry Weiss is the executive Director of the Medford Urban renewal agency. Harry Weiss, welcome to Think Out Loud.

Harry Weiss: Great to be here, thank you.

Miller: What does the overall housing situation look like in Medford right now?

Weiss: Well, as your listeners know, the Rogue Valley suffered terrible devastation of housing units during the Alameda Fire on Labor Day of 2020. Regionally, we were already about 3000 units in the hole, and then we lost 2500 units of housing overnight. So it’s become really quite exacerbated and dire. And a huge number of those units that we lost in the fire were fairly inexpensive units that were serving lower income households and workforce households. So we’ve got a big hole to climb out of.

Miller: Many of the homes that were lost in the fire, in Phoenix and Talent, were mobile homes or at RV parks, what some people call naturally occurring affordable housing. What is the idea for how to replace that broadly in the Rogue Valley? And I know you’re based in Medford, but but all housing is really connected in a region.

Weiss: Yeah, obviously it’s a regional challenge, and all the municipalities and jurisdictions here need to align around housing production. And there’s a fair amount of work that’s happening in Talent and Phoenix right now, working with the housing authority of Jackson County and private developers who are beginning to rebuild and reestablish some of those parks.

Unfortunately, a lot of that housing is not going to come back at the price point that it was available before the fire. We’re talking about units that were running for $500, $600 a month, and that’s just likely not going to be attainable. So, we have to diversify, and find all the sources that we can for capital-A Affordable Housing, such as Mr Jones spoke about, LIFT and LIHTC. And then how do you also tackle the kind of workforce stuff that we generally ascribe to people making between 80 and 120% of the area median income. That’s a segment of the market that doesn’t have funding sources like LIFT and LIHTC, and has very, very narrow margins in terms of profitability. So it’s very difficult to attract investor capital to come in in that middle segment.

Miller: My understanding is that that is what’s happening though for a new 62 unit apartment complex that’s going to be starting up in downtown Medford in just a couple of weeks. What is this place?

Weiss: Yeah, that’s the Genesis Apartments. It’s on a piece of property that MURA owned. It was one of our first properties that we bought for the parking system, it was a 45 space parking lot.

Miller: MURA, that’s that’s your agency, the Medford Urban Renewal Agency.

Weiss: Correct. It had 45 parking spaces on it. And the board of directors, who is also the city council of Medford when I joined the organization back in 2018, they said let’s look at our land assets, and see if there are higher and better uses that we can put these properties to, especially in the downtown, relative to the fact that we have aspired to have housing downtown for decades, and we have not seen a substantial investment in housing downtown. So this was kind of the lowest hanging fruit of the properties.

We began a conversation with a local developer named Laz Ayala of KDA Homes, who is heavily invested in downtown, and has a really solid track record of developing housing in the Rogue Valley, particularly in Ashland. And he saw an opportunity to do a legacy project by doing a multi family project on this site. His investment is structured using the Opportunity Zone benefits under the federal tax law that was passed in 2017. So that changes the calculus a little bit in terms of how the project has to perform economically, because when you look at the economic pro forma on this project, it’s still very narrow margins, very very slight profitability. But again, being a legacy project, being a long term goal of downtown, Laz wanting to give back to the community in a substantial way, and the Opportunity Zone were enough of a thumb on the scale to shift this into a viable project.

Miller: What other housing developments are in the works right now in terms of affordable housing of any kind in Medford?

Weiss: Well, our agency is also working with a developer for a 4% LIHTC plus LIFT project. We own 3-¼ acres in the neighborhood immediately north of downtown that’s known as Liberty Park. We assembled that property back in 2019, we’re looking at putting 113 units of housing there that will be affordable to families making 60% of the area median income or less. So that’s the biggest project that we have going on in the city limits right now. The Housing Authority of Jackson County has a very long and successful track record of the 9% LIHTC projects, and they have a couple of projects in the pipeline on property that they own. It’s not in downtown, it’s elsewhere in the community.

MURA is also exploring how we might catalyze or demonstrate how you do missing middle. This is the new initiative that came out of the State Legislature to legalize duplexes, triplexes, and quadruplexes in neighborhoods where we have single family housing. So, we’ve acquired two sites in this Liberty Park neighborhood that would lend themselves to 4 to 12 units of housing, which is a difficult scale to try and produce, because they don’t have economies of scale. They previously would not have been allowed in these locations. So we’re hoping to work with some developers doing a demonstration project about how you build that kind of housing as an infill opportunity.

Contact “Think Out Loud®”

If you’d like to comment on any of the topics in this show, or suggest a topic of your own, please get in touch with us on Facebook or Twitter, send an email to thinkoutloud@opb.org, or you can leave a voicemail for us at 503-293-1983. The call-in phone number during the noon hour is 888-665-5865.

THANKS TO OUR SPONSOR:
THANKS TO OUR SPONSOR: