August 1, 2023

MEDIA CONTACT: Michael Andersen, Sightline Institute,  

PORTLAND, OR – A new city-commissioned study of Portland’s six-year-old affordability mandate for new apartment buildings suggests that the rental program can work well when fully funded, but that it is not currently fully funded outside central Portland.  

The Pacific Northwest-based think tank Sightline Institute has drawn on this study by BAE Urban Economics to recommend four ways to better calibrate the city’s Inclusionary Housing program: 

  • Clarify that a core program goal is to maximize the number of relatively deeply affordable homes (affordable to people making no more than 60 percent of area median income [AMI]) in areas with amenities like high-performing schools and mass transit. 
  • Fully fund it outside central Portland by expanding to more of the city a full 10-year property tax abatement for buildings that create homes at 60 percent AMI. The city-commissioned study suggests the program has been working successfully in central Portland since 2017. 
  • Preserve tax abatement capacity by phasing out the abatement in areas with less valuable amenities and lower market prices, where less subsidy is needed to fully fund the program. 
  • Preserve tax abatement capacity by not fully funding buildings that create homes at 80 percent AMI, which in some cases is comparable to market rents. The 80 percent path would remain as an option. 

“This study by BAE turned up some really good news,” said Michael Andersen, senior researcher at Sightline and a member of the city’s inclusionary housing calibration work force. “Temporary tax abatements are enough to bring Portland’s affordability mandate into balance, and when fully funded, the program is really cost-efficient. We hope the council will act on this new information soon, because today’s underfunded program is not cost-efficient and is slowing Portland’s production of both market-rate and below-market homes.” 

Sightline’s recommendations are similar to those in a letter the calibration work force sent to Portland City Council last week. 

Read the full article: Four Ways to Improve Portland’s Housing Affordability Mandate 



Michael Andersen is Senior Housing Researcher and Transportation Lead at Sightline Institute. View his latest research, and follow him at @andersem. 

Sightline Institute is an independent, nonprofit think tank providing leading original analysis of housing, democracy, forests, and energy policy in the Pacific Northwest, Alaska, British Columbia, and beyond. 

August 1, 2023