BEAVERTON CITY COUNCIL
REGULAR MEETING
DECEMBER 01 , 2003

CALL TO ORDER:

The Regular Meeting of the Beaverton City Council was called to order by Mayor Rob Drake in the Forrest C. Soth City Council Chamber, 4755 SW Griffith Drive , Beaverton , Oregon , on Monday, December 1, 2003 , at 6:35 p.m.

ROLL CALL:

Present were Mayor Drake, Couns. Dennis Doyle, Fred Ruby, Forrest Soth and Cathy Stanton. Coun. Betty Bode was excused. Also present were City Attorney Alan Rappleyea , Finance Director Patrick O'Claire , Community Development Director Joe Grillo , Engineering Director Tom Ramisch , Operations/Maintenance Director Gary Brentano, Library Director Ed House, Human Resources Director Nancy Bates, Police Chief David Bishop, Building Official Brad Roast , Senior Planner Alan Whitworth , Associate Planner Jeff Salvon and Deputy City Recorder Catherine Jansen.

CITIZEN COMMUNICATIONS:

Pavel Goberman said many children and adults used the computers at the library. He said adults waited because children were using the computers in the adult section, even though the computers in the children's section were available. He said the computers in the children's section were filtered; but they were not filtered in the adult section. He said he thought that was one of the reasons the children preferred the adult-section computers. He asked for enforcement of the rules for computer use so that children used the computers in the children's area only.

COUNCIL ITEMS:

Coun. Soth announced he would not be a candidate for re-election next year. He stated his health was fine but after 28 years in appointed and elected service, he felt it was time to relinquish the reins and provide room for someone else. He said he planned to remain involved in the City and community, and he hoped to continue to serve the City in some fashion.

Mayor Drake acknowledged Coun. Soth's many year's of service to the community, noting he had served four years on the Planning Commission and 24 years on the City Council. He noted the City would be honoring Coun. Soth for his service; he had served with distinction, honor and class. Mayor Drake thanked Coun. Soth for his years of service and guidance.

Coun. Doyle thanked Coun. Soth for his service and added the thanks of many citizens and the City staff. He said Coun. Soth would be greatly missed.

Coun. Stanton announced that tomorrow night (December 2) would be the City's Annual Holiday Open House in the City Hall Council Chambers from 5:00 p.m. to 7:00 p.m. She noted there would be music, food and a visit from Santa Claus.

STAFF ITEMS:

There were none.

CONSENT AGENDA:

Coun. Doyle MOVED, SECONDED by Coun. Soth, that the Consent Agenda be approved as follows:

Minutes of Regular Meeting of November 10, 2003

03258 - A Resolution Adopting the Natural Hazards Mitigation Plan Developed by City Staff and the University of Oregon, as the City's Natural Hazards Mitigation Plan (Resolution No. 3739)

03259 - Liquor License Applications: New Outlet: Mingo; Tienda Mexicana San Pedro. Change of Ownership: Uptown Market. Addition of Partners and Change of Trade Name: Canyon Shell; Town Center Shell; Waterhouse Shell.

Contract Review Board:

03254 - Bid Award - Finance/Information Systems Department Remodel Project

(Carried over from 11/17/03 meeting)

03260 - Contract Change Order - Spencer and Kupper for the Second Phase of Extension - Economic Development Strategic Plan Project Assistance

03261 - Contract Change Order - Bainbridge Design, Incorporated, for Design Services on the Information Systems and Finance Department Remodel

Mayor Drake asked if Mr. Johnson was in the audience. He noted for the record that Mr. Cliff Johnson was not in attendance at the meeting.

Coun. Doyle stated he would abstain from voting on the November 10, 2003 , minutes as he was not at the meeting.

Coun. Stanton said she had a few corrections to the minutes. There was Council consensus to accept the changes.

Question called on the motion. Couns. Doyle, Soth, Ruby and Stanton voting AYE, the MOTION CARRIED unanimously. (4:0) Coun. Doyle abstained from voting on the November 10, 2003 , minutes for he was not at that meeting. Mayor Drake noted for the record that when he asked if Mr. Johnson was in attendance, no one responded.

PUBLIC HEARING:

03262 - Adopt Resolution and Authorize Implementation of Building and Mechanical Permit Fee Increases (Resolution No. 3740)

03263 - Adopt Resolution and Authorize Implementation of Site Development Permit Fee Increases (Resolution No. 3741)

Mayor Drake asked the City Attorney if the two public hearing items could be heard simultaneously.

City Attorney Alan Rappleyea replied the items could be heard simultaneously but separate motions were needed for each item.

Building Official Brad Roast offered to answer Council questions on the two proposed fee increases.

Coun. Soth asked how the fees compared now with surrounding jurisdictions.

Roast explained the City's fees were neither the highest or lowest in the region. He noted the building permit fees for construction of a new home in Washington County and Portland were higher than Beaverton 's fees and Hillsboro 's fees were lower. He explained this was a dedicated fund and the City wanted fees that offset the cost of operating expenses for the Building Division while maintaining a reasonable contingency fund. He said the City's process was to increase fees in small increments so the development community was not impacted to a great degree.

Mayor Drake explained this was the second phase of fee increase that was recommended a year ago and the City's Development Liaison Committee endorsed the increase.

Coun. Stanton thanked Roast for the detailed report which made her comfortable with the information and the decision to increase the fee. She complimented the City's building officials for providing the highest level of safety for the citizens by closely monitoring the State's health and safety standards.

Mayor Drake opened the public hearing at 6:53 p.m.

There was no one present who wished to testify.

Mayor Drake closed the public hearing at 6:53 pm .

Coun. Stanton MOVED, SECONDED by Coun. Soth that Council approve the Resolution and Authorize Implementation of Site Development Permit Fee Increases, as reflected in Agenda Bill 03263. Couns. Doyle, Ruby, Stanton and Soth voting AYE, the MOTION CARRIED unanimously. (4:0) (Resolution No. 03741)

Coun. Ruby MOVED, SECONDED by Coun. Soth that Council approve the Resolution and Authorize Implementation of Building and Mechanical Permit Fees Increases, as reflected in Agenda Bill 03262. Couns. Doyle, Ruby, Stanton and Soth voting AYE, the MOTION CARRIED unanimously. (4:0) (Resolution No. 03740)

WORK SESSION/ACTION ITEM:

03264 - Consideration of Implementation of Affordable Housing Production Tools and Strategies (Resolution No. 3742)

Principal Planner Hal Bergsman introduced the consultants and staff who worked on the Affordable Housing Study as follows: Matt Hastie, Cogan Owens Cogan, Consultant; Kurt Wehbring, Sextant Consultants; Ramsay Weit, Consultant; Associate Planner Jeff Salvon; and Senior Planner Alan Whitworth .

Bergsma explained this item was being considered to receive Council's comments on the City's Affordable Housing Study which would be submitted to Metro as the second of three compliance reports required by Title 7 of Metro's Urban Growth Management Functional Plan. He reviewed the purpose of Title 7. He explained the purpose of the second compliance report was to report to Metro on Plan and Code amendments (pending or adopted) that implemented tools and strategies for increasing affordable housing in the City. He noted this second report was due December 31, 2003 . He said the purpose of the third compliance report (due June 30, 2004 ) was to describe the outcome of the Plan and Code amendments that were pending at the time of the second compliance report. He explained a decision was needed on any Plan or Code amendments to be considered by the end of this year; and by the middle of next year hearings need to be conducted and decisions made about those amendments. He said the consultant would review the tools and strategies recommended for implementation.

Matt Hastie , Cogan Owens Cogan, consultant, summarized the draft Second Functional Plan Compliance Report - Affordable Housing Study prepared for the City. He presented a Power Point slide presentation that summarized the report in detail (in record). He explained the tools and strategies being recommended were evaluated based on the following criteria: Cost to the City; Political Feasibility or support; Potential to produce or retain affordable housing units in the lowest income ranges; Administrative complexity; Ability to implement in the short term; Consistency with existing City policies; Potential for partnering with others; Ability to leverage other resources; and Overall Feasibility.

Hastie reviewed the recommended tools and strategies, in detail, and their priority (in record). The tools and strategies were:

High Priority: Public Education Efforts; Revolving Fund for Permitting or Development Fees; Land Banking and Assembly; Community Housing Trust Fund Contributions; Long-term Affordability Requirements; Reducing Barriers to Senior and Disabled Housing; Employer-Assisted Housing.

Medium Priority: Density Bonuses; Property Tax Abatement; Real Estate Transfer Tax; Non-profit and Other partnerships, including Faith-Based Groups.

Low Priority: Transfer of Development Rights (no action recommended); Replacement Housing Ordinance; Reducing Regulatory Constraints; Reducing Parking Requirements; Document Recording Fee.

Hastie explained the next steps were to obtain Council's recommendations on refinements to the study. He noted these recommendations would be incorporated into the study and staff would then submit the Second Functional Plan Compliance Report to Metro by the December 31,2003 , deadline. He noted in the months following the submittal, staff would identify the implementation steps needed, including incorporating updated policies into the Comprehensive Plan.

Mayor Drake confirmed with Hastie that this document was the amended version which the Planning Commission forwarded to the City Council.

Coun. Soth asked how they would get away from the concept of rent control for enforcement, when a 30% income was specified in the criteria of affordable housing. He added it would be up to the landlord to enforce that, unless it was a HUD Section 8 Program. He said he understood the Section 8 Program was either contracted, not being renewed, or in some cases being phased out. He stressed this needed to be looked at carefully.

Coun. Soth asked if in the study they considered the situation where units were originally built as Section 8 or low income programs, then a few years later the property was sold and the new owner decided to go with the new market prices.

Hastie replied they had not specifically looked at that as most Section 8 or HUD- financed units had long-term affordability requirements. He said they were required to have affordable rents, and to rent to families that met certain income levels, for 20 to 30 years. He said most State and Federal agencies had this requirement although after the 20 or 30 years, many of the units were sold and dropped out of the affordable housing category. He said that was one of the motivations for identifying replacement housing as a tool for the City, though it could not be mandated by the City. He noted there was a limited amount the City could do when those units dropped out of the affordable housing category

Coun. Soth asked if there was any incentive for a builder to enter the affordable housing market with the high cost of land. He asked how a builder could provide affordable housing on lots that were $60,000.

Hastie replied that any affordable housing development was possible through layering of different types of programs such as grants, contributions from agencies, and benefits from lending institutions. He said it always took a variety of programs to provide affordable housing, particularly in an area where land costs were high.

Coun. Soth concluded that Beaverton 's citizens do not react positively to tax abatement policies. He noted regarding housing for elderly and disabled, one of the big impediments to affordable housing was the additional cost to make those housing units accessible for the elderly and handicapped. He noted the added cost for these facilities required public subsidies. He said regarding the revolving fund, the initial input required an allocation from City or another agency beyond the development fees.

Hastie explained implementing any of these strategies required an investment of funds and staff. He said the City had to allocate funds to promote, encourage and/or help pay for the development of affordable housing. He noted the bigger question was how much to allocate.

Coun. Soth asked what would be the effect of additional traffic in that area.

Hastie responded they had not spent a lot of time identifying the impacts. He noted most of the recommended tools would not have an effect of increased density or increased traffic. He agreed some of the tools would have an impact, such as the density bonus. He noted the Planning Commission advised them to review density bonuses in terms of impacts.

Bergsma said the Planning Commission was interested in using density bonuses as a tool to provide housing for the disabled and elderly, since they tended not to drive and had little impact on the road system. He said they also considered that the best places for affordable housing were places most accessible to transit.

Hastie added the Planning Commission discussed this in terms of light rail and buses service. He added the overall recommendations dealt with fostering partnerships and linkages with the non-profit community and others, as well as maintaining accurate information on the supply of land and properties that might be available for affordable housing. He added the report described a relatively limited supply of buildable land in the City.

Coun. Soth asked how much the requirement for inclusionary housing had raised the cost for other units in the development. He noted that inclusionary housing assumed the housing units were for sale and to recover the actual cost the developer needed to increase the price of the other units.

Hastie replied that was not considered because it could not be required; inclusionary housing requirements could not be mandated. He recommended looking at incentives in the forms of density bonuses, property tax abatements, and other tools to allow inclusionary zoning on a voluntary basis.

Mayor Drake commented that the real estate transfer tax proposed a few years ago would have generated $50 million in the region. He said that would have leveraged development six to seven times that amount. He recalled that GSL Properties built several complexes in the City. He said GSL was a good example of using funds to leverage additional funding; GSL used State or Federal grants, tax credits or abatements, and other methods to leverage funding. He noted this leveraging could turn $50 million into $350 million of development. He said he thought the intent behind that was to leverage development dollars to offer incentives and assistance. He said as proposed at that time, one third of the funding was for infrastructure and two-thirds was for leveraging funds. He noted in this region a third of a billion dollars a year for new development would be a huge spurt in the economy.

Bergsma explained as part of the analysis, they interviewed David Bell of GSL properties and he was very enlightening in terms of impediments to providing affordable housing. He said Bell explained how his firm operated to provide affordable housing, especially using Federal Housing Unit Tax Credits, which were aimed toward those at 60% of median housing.

Coun. Doyle strongly urged the Council to move the strategy of working with "Non-profit and Other Partnerships, including Faith-Based Groups" from medium priority to high priority (Staff report, page 10). He said he noticed of the seven strategies currently listed under High Priority, four had the key words low cost . He said that function was low cost and could be accentuated in a very inexpensive way, through public education efforts. He stressed such projects had a significant impact; he felt it would be best if the City stressed that as a key component for it would be a strong motivator. He said he was watching it happen in a couple of places now. He asked that the study be revised to make this strategy a high priority.

Hastie explained how that strategy was given a medium priority rating and said he agreed with Coun. Doyle's recommendation.

Coun. Stanton noted the City had a Social Service Funding Committee that disbursed funds every year. She reported the Community Action Organization and the Good Neighbor Center were two of the programs supported by the City. She asked if the City had a staff member that attended the Community Partners Affordable Housing (CPAH) meetings each month.

Associate Planner Jeff Salvon explained CPAH was a Tigard based organization; there weren't any of their projects in Beaverton so city staff had not attended any of their meetings.

Coun. Stanton suggested that instead of land banking, the City "dollar bank" and purchase and refurbish existing apartments when they became available.

Consultant Ramsey Weit, Portland , consultant, explained the Housing Authority of Washington County did that on a regular basis. He said their thesis was that acquiring those units was more efficient and cost effective. He said in some instances the cost was one-third as much as new build. He added it tied in with some of the expiring-use issues discussed earlier; if a 30-contract was expiring, someone could step in and maintain that commitment.

Bergsma explained that contributed to the supply of affordable housing, especially if the units acquired units were market-rate presently and met the needs of those over 50% of the median and were then rented to those who were under 50% of the median.

Coun. Doyle noted in regards to the Housing Authority that purchased the housing, he said he listened to a presentation on that and it was working. He said the federally-subsidized housing had a waiting list of over 600 people in the County, and it was taking two to three years to get into a home. He said he felt it would be good to formulate a policy to implement that type of program. He added there were a lot of tax advantages to doing this, even if it was done privately.

Coun. Stanton asked about density credits. She said she was not crazy about density bonuses. She asked if density credits could be used to allow a developer to build at a higher density on one project in trade for a lower density on another project.

Hastie explained it was a little like the idea transferring of development rights. He said what she was suggesting was a little different in that it was applied to a specific developer or development, instead of applying it to a specific area.

Coun. Stanton noted such a density credit could allow a developer to develop high-end properties and still build at a higher density on another property. She said she thought it was an interesting concept to discuss and explore.

Coun. Ruby said he found the material very interesting in that there was no legal means to mandate any type of contribution by a developer to affordable housing. He said he had read in some projects where developers were required to establish a certain component that was devoted to rental housing. He noted in the Waterhouse Residential development had a multi-family component. He asked where the multi-family component was coming from.

Hastie explained the multi-family component could be required with any project, but the City could not require that the units be priced at the level that was affordable to people at a certain income range.

Bergsman explained there was one exception; when Metro brought certain areas into the Urban Growth Boundary, it had required that some of the housing be affordable to people at 80% median. He said that was the only exception.

Mayor Drake explained that was a voluntary agreement, it was not mandated. He added the developer agreed to that condition.

Bergsma noted the objectives Council adopted in August referred to this for Bethany .

Coun. Stanton pointed out that the Metropolitan Housing Rule required the high level of multi-family housing in the metropolitan area. She added that not all the multi-family zones (R2) were developed as multi-family; she noted most apartment complexes had small units and were not designed for families with children. She said that just because apartment complexes were labeled multi-family, did not mean they catered to or welcomed families. She said affordable housing involved looking at housing for families.

Bergsma said that was a good point. He said one of the stakeholders in the interview process pointed out there was a disincentive to provide apartment units for larger families because of the minimum density requirements that are imposed because of Metro's requirements. He said achieving the required 80% of maximum was hard with three-bedroom units. He suggested they might explore changing the way density was calculated, so it was not based on the number of units but on the number of bedrooms.

Coun. Stanton urged Council to direct staff to lobby Metro to review its housing requirements and densities so that cities have the flexibility needed to provide family housing in a multi-family situation. She asked, regarding the reduced parking requirements, if that meant there would be more parking spaces per unit.

Hastie replied no.

Mayor Drake summarized the Council's revisions to the study, as follows:

-That the strategy of working with "Non-profit and Other Partnerships, including Faith-Based Groups" be moved from medium priority to high priority;

-Include in the recommendations encouraging the purchasing and renovation of older units; and

-Look at the hybrid of a density transfer concept with density credits, mold it into a recommendation and assign it a priority.

Bergsma asked if the Council wished to assign a priority to the idea of acquiring existing apartment complexes.

Coun. Stanton said she thought it should be high priority since these were existing units with infrastructure already in place and because of the value for the dollars invested.

Mayor Drake asked if staff was looking for approval of the report with the amendments.

Bergsma replied yes and approval of the resolution. He noted the amendments would be incorporated into the report first and then it would be submitted to Metro by the December 31, 2003 deadline.

Coun. Doyle MOVED, SECONDED by Coun. Soth, that Council approve the study in Agenda Bill 03264 having to do with the consideration of implementation of affordable housing production tools and strategies, as modified by Council discussion at this session and direct staff to incorporate these revisions into the study, and that Council authorize the Mayor to sign the resolution authorizing submittal of the Second Functional Plan Compliance Report to Metro.

Mayor Drake complimented the Council, staff and consultants for their excellent work and noted most jurisdictions had not gone to this depth to meet the compliance requirements. He said this report could be a model for the rest of the region in terms of analysis.

Question called on the motion. Couns. Doyle, Ruby, Soth and Stanton voting AYE, the MOTION CARRIED unanimously. (4:0)

RECESS:

Mayor Drake called for a brief recess at 8:01 p.m.

RECONVENED:

Mayor Drake reconvened the meeting at 8:13 p.m.

Mayor Drake noted that Tigard's Mayor Jim Griffith passed away on Friday. He stated Griffith was a very fine man and this was a big loss for Tigard and Washington County .

ORDINANCES:

Suspend Rules:

Coun. Soth MOVED, SECONDED by Coun. Stanton , that the rules be suspended, and that the ordinance embodied in Agenda Bill 03265 be read for the first time by title only at this meeting, and for the second time by title only at the next regular meeting of the Council. Couns. Doyle, Soth, Ruby and Stanton voting AYE, the MOTION CARRIED unanimously. (4:0)

First Reading :

Rappleyea read the following ordinance for the first time by title only:

03265 An Ordinance Amending Ordinance No. 4187, Figure III-1, the Comprehensive Plan Land Use Map and Ordinance No. 2050, the Zoning Map, for Property Located at 8655 SW Canyon Lane; CPA 2003-0010/ ZMA 2003-0012 (Ordinance 4279)

EXECUTIVE SESSION:

Coun. Soth MOVED, SECONDED by Coun. Doyle, that Council move into executive session in accordance with PL 107-188, Section 401(a)(3) dealing with water system security measures. Couns. Doyle, Ruby, Soth and Stanton voting AYE, the MOTION CARRIED unanimously. (4:0 )

The executive session convened at 8:17 p.m.

The executive session adjourned at 9:11 p.m.

The regular meeting reconvened at 9:11 p.m.

ADJOURNMENT

There being no further business to come before the Council at this time, the meeting was adjourned at 9:11 p.m.

APPROVAL:

Approved this 15th day of December, 2003.

__________________________________
Rob Drake, Mayor