Thursday, October 26, 2017

City of Portland Affordable Housing CET Collections Are Lagging Projections.

When the City of Portland Affordable Housing CET was enacted in August of 2016 an accompanying exhibit showed projected annual CET collections at $8.085 million, based on the preceding 5 year average of development activity. 

Data I have received from the City of Portland shows that collections to date are lagging below that historical projection.   

  • For the first 11 months of CET adoption, from August of 2016 to June 2017, total collections were only $1.897 million. 
  • For the first three months of FY 2018 (July 2017 -September2017 ) total CET collections were $2.525 million. 
  • So for the first 14 months total collections were only $4.422 million vs the previously projected $8.085 million projection for 12 months.  
  • However, IF collections in first quarter of FY 2018 are annualized then total FY 2018 collections would be $10.102 M, but still only $12.12 Million for 23 months (or an average of $6.086 Million annualized for the first two years, or 25% below the projections based on the preceding 5 year average).
One possible reason for the lag in collections may be the exclusion from the CET of projects with permits issued before the CET effective date, even though those projects may take months or years to reach construction start.  

Portland's collections experience may be useful for other jurisdictions considering a CET , including Euguene and Washington County. 

Originally created and posted on the Oregon Housing Blog. 

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