Thistle & Nest, an affordable housing provider in Bend, says the city’s new tree code isn’t flexible enough and is raising the cost of building new housing in Central Oregon. At one of the affordable housing developments Thistle & Nest is currently building, the code will mean fewer homes get built, according to the organization, which is refusing to submit a tree preservation plan for the site. That challenge is currently being reviewed by a hearings officer and could be appealed to the Oregon Land Use Board of Appeals. Amy Warren, board president and co-founder of Thistle & Nest, joins us to explain why the nonprofit has decided to challenge the tree code.
Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.
Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. The housing nonprofit Thistle & Nest is working on projects to build more than 140 affordable housing units in Bend. They’ve gotten millions of dollars of state money to do so. But they say a newish city code intended to preserve Bend’s tree canopy is making their work harder and more expensive, so they are fighting that code. They’re refusing to submit a tree preservation plan for one of their sites.
Amy Warren is the board president and a co-founder of Thistle & Nest. She joins us now. It’s great to have you on Think Out Loud.
Amy Warren: Hey, Dave. It’s an honor to be here.
Miller: Can you describe the Murphy Crossing development that you’re working on?
Warren: Sure. Murphy Crossing, we call it Ponderosa Commons, will be a total of 100 homes when fully developed. And it, unfortunately, is a very treed parcel as well.
Miller: What does it take to piece together the funding or financing for a project like this?
Warren: A project like this generally has a subsidy of between, I would say, $150,000 and $200,000 per door, or per home, in order to make them affordable to low income, which is defined by a household making less than 80% of the area median.
Miller: So how much would a prospective homeowner have to pay to buy one of these units?
Warren: The projected cost at Ponderosa Commons ranges between $215,000 and $330,000 – the effective price after the subsidy.
Miller: How does that compare to the city average?
Warren: Oh gosh, I think our median home cost is in the mid-$800,000s right now.
Miller: Wow. So a third or so of that cost. So let’s get to the big issue at hand. Can you explain the basics of what Bend’s new tree rules require?
Warren: The first thing they require is a tree inventory survey, so that’s an additional cost. It’s not huge, but all these things add up. Once you have your tree survey, it documents all of the trees, what sizes, all that kind of stuff.
There are a few options. The first one is keeping the trees up, a ratio of trees. There are three options in this tree keeping formula. This tree code in this property, this development of Ponderosa Commons, happened to come into effect, though, after the site was designed. It generally takes between $50,000 and $80,000 just in civil engineering to design a site of this size. So for this particular development, keeping the trees in any of those three ratios would have meant redoing design, moving roads, moving utilities, losing homes, etc.
Miller: Which makes it seem basically unfeasible. And then, am I right that another option you would have, instead of redoing your design, is you could chop down trees if the plan calls for that? And then you could pay the city for the trees that you chop down?
Warren: That is correct.
Miller: How much would that add to the cost of the project?
Warren: I don’t have the calculation for the entirety of Ponderosa Commons, but the first 30 homes, I think, were upwards of $24,000 in fees.
Miller: If my math is correct, because I saw that number in some reporting in the Bend Bulletin in other places, it seems like it’s only $800 a piece, $800 per unit. Why is that such a big deal?
Warren: It’s a big deal because funding is scarce, number one. It’s not easy with building expenses, labor and materials where they are right now, to build a home with the subsidy we get that we can pass along to a buyer at $215,000 to $330,000, depending on the household size, house size and whatnot. Every cent counts.
And like you said, $800 for one house. But compounded, our pipeline of homes right now is for just over 450. So when you apply this to all the homes, it becomes a big expense.
Miller: So it’s fair to say that when you’re fighting this particular tree requirement for this particular portion of one development, your eyes are on the larger issue of what the city’s new tree code will mean going forward for all of your projects?
Warren: Correct. It is an investment in the long-term for us. I also really don’t love the word “fight.” I can’t speak for the city, but I feel like we are very supported by the city of Bend. I feel like we have a good relationship with the majority of the departments at the city of Bend. We’re developing a city of Bend surplus property right now for one of our projects. So I view this more as a really well-intended code that, when put into practice on the ground, needs to be re-evaluated.
Miller: How would you feel if a market rate home builder made the same argument? In other words, for you, is it crucial that you are building affordable housing? Or is the argument you’re making that this rule needs to be rethought? Does that encompass every kind of home building?
Warren: One of the areas [where] I think it needs to be rethought would apply to all affordable and market home builders – that is the mitigation tactic of replanting a certain number of trees for the number of trees you take.
Now in practice, this is a really good idea. But for our developments, when we’re in a multi-family zone and the city of Bend is also encouraging urban infill, we are making most efficient use of our land space. And when we did our first 30 homes last year, I asked our landscaper, “Will you plant trees in the front yard?” And he said, “No. The trees that the city requires, with the 2-inch caliper trunk, you will cut them down in 10 to 15 years because they’re going to be about 20 feet high, 10 to 15 feet wide at full maturity. They’re gonna buckle your sidewalk, they’re gonna run into your house.”
So it’s not that we didn’t plant trees. We just chose dwarf, slow-growing versions that were also not water needy. Another overlooked part of this new tree planting mitigation is that all of these new trees are water needy. The current native trees are not on irrigation. In addition to being in a housing crisis in Oregon, we really need to be conscious of our water usage.
Miller: The Bend Bulletin reported recently that the tree code issue is just one of a few areas where city staff said your application didn’t comply with the city’s development code. Those other areas include vehicle standards, pedestrian pathways, architectural standards, landscaping, EV standards and more. Where do all of those other issues stand right now?
Warren: I can’t speak to the particulars of every single one of those. But when we received our response from the city, we went back to the drawing board and modified architectural stuff, orientations of homes, etc. So I think most of those, we have complied with.
Miller: I wanna turn to the big picture here in the time we have left. As you said, you don’t like the word “fight” for what you’re doing, because you’ve actually had a good relationship with city staff and, obviously, they are supportive of there being more affordable housing in the city. What do you see as a workable compromise going forward? What kind of a tree code do you think would do the best to maintain or preserve as much of the canopy as possible, while also enabling as much housing affordable and otherwise as possible?
Warren: Thanks for bringing that up. And thanks for giving us the opportunity because in business ethics, as everyone knows, there’s not a right choice and a wrong choice. It’s human nature for us to want to place good, bad, right, wrong. “These guys are not doing it correctly.” But at the end of the day, we like trees as well. And we would like to see them in our communities. But when we’re faced with the choice of eliminating a home or eliminating a tree, we make the least wrong choice … basically the best way to put it.
So I would like to see the tree code have flexibility. I think what we’re finding, not just us but other developers, is that each site is unique. Ponderosa Commons at Murphy Crossing is very treed. We have a couple of other projects where they’re not very treed. Some are in multi-family zones. Some are in single-family zones. This is not a one size fits all, and I think it would be really nice to have the caveat in the tree code that they can evaluate on a case-to-case basis. I know that’s not how things are generally done, but that’s what I would like to see.
Miller: Amy Warren, thanks very much for your time. I appreciate it.
Warren: Thank you.
Miller: Amy Warren is board president and co-founder of the housing nonprofit Thistle & Nest, which is based in Bend.
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