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About The nugget. (Sisters, Or.) 1994-current | View Entire Issue (June 20, 2018)
Wednesday, June 20 2018 The Nugget Newspaper, Sisters, Oregon TAX: Builders are concerned about impact Continued from page 3 for long-term rental, Council acknowledges that workforce and middle-income residents are being priced out of the market. State regulations limit the CET on residential building permits to no more than one percent of the value. There is no cap on the percentage that can be charged on commer- cial construction. At this point in time, staff has created draft language for a suggested CET ordinance, based on what has been done in other cities. No decision has been made. City Manager Brant Kucera assured citizens in Council chambers last week that there is “no done deal.” “The one percent tax amount was put into the 2018- 19 City budget strictly for planning purposes,” explained Mayor Chuck Ryan. This concept began being discussed when Chris Frye was mayor. City Attorney Alan Dale explained the state regula- tions regarding a CET. For a residential CET, four percent of the money can go to the City for administration of the program. Voluntary builder incentives can account for 50 percent of the funds with 35 percent aiding City pro- grams for affordable housing. Fifteen percent has to go to the state for housing and com- munity services. The commercial CET funds have the same four per- cent for City administration. Fifty percent can fund City programs for affordable hous- ing like system development charge waivers. The remain- ing money can be used for programs assisting purchasers who make up to 120 percent of the county AMI, allow- ing help for middle-income workers. After meeting with City Manager Brant Kucera and Community Development Director Patrick Davenport on June 1, Karna Gustafson of the Central Oregon Builders Association sent a letter to the City Council in which she asserted the City had not used “an inclusive collab- orative effort and discussions with the building industry to make sure all impacts, view- points, potential unintended consequences” of the CET were considered. COBA also notified area builders about the CET without adequate information. The City’s intention for the June 1 meeting was simply to inform COBA that the City was beginning to investigate the possibility of instituting a CET to help address the problem of affordable hous- ing. Gustafson appeared to assume that the CET was a “done deal.” Mayor Chuck Ryan took exception to the letter, stating that “we will have a plan” for how the CET would be used, in answer to Gustafson’s assertion that the City had proceeded with a draft ordi- nance with no plan for how the money would be used and what programs would be created. When plans are formu- lated, the City intends to meet with the building community to discuss exactly what would be done with funds raised by a CET. Local builder Curt Kallberg told Council he makes a five percent profit on his houses. Having to pay a 1 percent CET would mean he would lose 20 percent of his profit. “If we go out of business, you are hurting the people Have a STORY who work for us, the very people you are trying to help,” Kallberg said. Council President Nancy Connolly likes the idea that a commercial CET can invest in workforce housing for those who earn too little to pay market rate for housing but too much to qualify for subsi- dized housing. Councilor David Asson expressed concern about the COBA letter. He said, “Affordable housing is impor- tant, but one percent CET is too high for both residential and commercial construc- tion.” He believes there could be unintended consequences. He would like to “delay the whole process.” His sugges- tion was to spend more money on economic development. Council reached consensus that they would like staff to We’d love to hear it! A tradition of excellence, ce, trust t ust & service se ce Send an email to editor@nuggetnews.com WE HAVE ONE OF THE E LARGEST INVENTORIES S WE HAVE HAD IN AWHILE! Selling or Buying? Call me. Ellen Wood, Broker, GRI, ABR ellen.wood@cascadesir.com 541-588-0033 | 290 E. Cascade Ave., Sisters CUSTOM HOMES • RESIDENTIAL BUILDING PROJECTS John P. 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They agreed that money is needed to help with local housing issues but they are not locked into a 1 percent tax on all construction. They agreed to talk with the key organizations that would be affected by the CET and plan to do another workshop. Connolly asked if the CET could be phased in over a period of time. Attorney Dale said that could probably be done; he will investigate. Eight other Oregon com- munities have already adopted a CET, and Bend has a special excise tax in place. Kucera thanked the Council for addressing “criti- cal stuff that needs to have action taken and not kicking it down the road. We appreciate you taking action.” A Giant Among Realtors idea for The Nugget? 29 Placement deadline is Monday before noon, at 541-549-9941 or nuggetnews.com. It’s A Dog’s Life Paint Party! y Wed., June 27, 6 to 8 p.m. $35 per person includes supplies. Contact Corrie or Debbie to buy tickets. Corrie C. Lake 541- 419 - 8156 541- 521 - 2392 Lic#200511204 Lic#201218852 262 S. 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