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City Council Refuses to give Mayor Hales the Votes He Needs for Demolition Tax

Portland Demolition Tax Voted DownWe can finally exhale; letting out our bated breath as the verdict of the looming Demolition Tax was put to bed earlier this month.

Mayor Charlie Hales’ proposal, in case you’re hearing this for the first time, was slated to add a demolition tax of $25,000 to any new home construction project in the city of Portland that required an old home to be torn down.  Hales’ proposal, though seemingly noble on the front end left little room for practicality and a plenty of room for doubt and critique in the minds of its opponents.  Chief adversaries of the tax, obviously being builders, were not the only group to voice their opinions however.  Home buyers, who understood the tax would trickle down, topped the list as well.

In the Mayor’s defense the city has struggled in the area of low income housing and, with the verdict from Metro to not extend the UGB at the end of summer, it’s clear that something needs to be done about Portland’s urban growth; the ever present warning of San Francisco’s housing and rent markets continues to make itself known.

This Tax was set to take a large portion of the money and use it to fund the sagging market by strengthening the city’s supply of low income units and rentals, but would only, as Commissioner Amanda Fritz was quick to point out, “make single-family housing even more unaffordable.”

There are a good deal of concerns surrounding Portland’s housing market as people continue to move here from all over the country, but the point The Oregonian made is very valid, “ Any efforts to help folks afford to call Portland home will need better integration and thought than tacking on a new fee here, another tax there.”  For now at least home builders and prospective buyers in the Portland area need not worry about an extra cost being added to their projects or to the purchase prices of their new homes.

Keep your eyes peeled, however, as the battle isn’t over.  Charlie Hales has promised to come back with a revision to the Demolition Tax by mid-January.

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