Three years ago, the Metro Council took a look around greater Portland and saw two things: Thousands of acres of vacant, developable land, and thousands of units of apartments under construction in Portland.

That look, combined an analysis by experts and computers, showed that the region had enough land within its urban growth boundary to handle 20 years of growth.

The council agreed with the demographers and experts. But it also handed out a caveat: Metro would again look at how greater Portland is growing in 2018, three years earlier than required, just to make sure the apartment boom was a long-term trend, not just a short-term bubble.

Well, 2018 is here, and Portland’s skyline is still dotted with cranes lifting beams onto six-story buildings. In Beaverton, Hillsboro, Happy Valley and Lents, apartments are filling in business districts.

What does that mean for this year’s urban growth review? Here’s a look at what goes in to this year’s look at the region’s growth plan.

What’s the urban growth boundary?

It’s where the city ends and the farms and forests begin. Every Oregon city has one. But the 24 cities in the Portland region share one common UGB, managed by the regional government, Metro.

Why does Portland have one?

Oregonians have always been a little skittish about growth. In the 1970s, as an effort to curb the sprawl that was so typical of western cities, Oregon established a land use law that limited development outside of established communities. That way, growth would be concentrated in existing areas, and farms, forests and deserts would be protected from sprawl.

How does it work?

Metro is responsible for ensuring that there’s enough land in the UGB for 20 years of growth – even if the UGB wasn’t expanded, we wouldn’t run out of room for two decades.

Inside of an urban growth boundary, cities around Oregon can plan what they want their communities to look like. They can then expand their UGB if they can show state regulators that they need more developable land. State regulators then look to see that cities followed the state’s rules and goals in managing their growth, ranging from addressing people’s housing needs to using existing land efficiently, to adequate citizen engagement, to choosing land with minimal impacts to farms and forests.

There’s one exception to every-city-has-a-UGB rule: In greater Portland, Metro manages the shared urban growth boundary for the 24 cities in the area, from Troutdale in the east, to Wilsonville in the south, to Forest Grove in the west.

Metro is responsible for ensuring that there’s enough land in the UGB for 20 years of growth – even if the UGB wasn’t expanded, we wouldn’t run out of room for two decades. That’s where demographers, developers, economists and land conservation advocates discuss what we can expect growth to look like, where future residents will want to live, and how efficient greater Portland is with the growth already in its UGB.

Portland’s shared UGB

How can we handle our growth and limit our sprawl?

The real key is making the most of existing land. There might be good reasons why nobody wants to build on that vacant lot down the street from you – but on the whole, it’s still probably cheaper for taxpayers to build on that lot instead of connecting a new sewer pipe or highway to housing on the edges of town. The urban growth boundary is a way to keep the costs of those pipes and roads in check.

At the same time, the UGB does, periodically, need to be expanded. It’s up to Metro, with the blessing of state regulators, to ensure that the expansions are meeting the region’s needs.

Doesn't the UGB cause density?

Oregon land use law favors places that have a variety of development types – apartments, condos and single-family homes, office buildings big and small, large factories and small manufacturers.

The fact is, UGB or not, any city’s going to have a healthy share of multi-family housing. But Oregonians familiar with other parts of the country, particularly the Sun Belt, know apartments in other cities tend to wind up nestled on six-lane boulevards on the edges of town, surrounded by parking lots. In greater Portland, the focus is encouraging that multi-family development in existing business districts, where people can walk to get to what they need and support small businesses.

There’s still plenty of room in the urban growth boundary for single-family homes, they just don’t all get clustered on the edge, plowing over farms and forcing taxpayers to pay for expensive new pipes and roads.

If a city plans exclusively for single-family homes on one-acre lots for growth, that plan is likely to be rejected by LCDC, the state regulators. The law would likely require that city to instead offer a variety of housing options for people.

Does the UGB cause rents and house prices to go up?

No matter where you are in the country, new housing is expensive. The average new American house costs more than $400,000, according to the National Home Builders Association. Rents in Portland aren’t that different from Austin, Denver or Atlanta. There’s a combination of factors at play: Housing construction almost totally stalled during the Great Recession, but population growth didn’t. Once the recovery began, the rush to build new housing caused the prices on everything from labor to drywall to go up.

In greater Portland, one driver of rising housing costs are “system development charges” – fees that builders pay to help support construction of the pipes, roads, parks and schools that are required for urban living. Taxpayers here have said those bills should be picked up by people buying new housing, not the public at large.

So where a new sewer line in, say, Phoenix, can be paid for by a combination of a small sales tax and small systems charge, here, all of those charges are put back on the developer, and ultimately, home buyer or renter.

Certainly, the urban growth boundary does cause land values to go up a bit. But compared to the totality of home prices, the difference is minimal: For a 5,000 square foot lot, the difference between land selling for $100,000 per acre and $200,000 per acre is about $11,500. When you’re talking about $450,000 houses – an $11,500 increase in land price is not causing affordability issues.

The UGB has been expanded dozens of times, including several expansions in the Hillsboro and Beaverton areas.

I heard that Metro has expanded the UGB dozens of times. What’s the point of having a boundary if it can be expanded indefinitely?

The UGB is meant to make the region think about growth, not to stop it completely. By encouraging developers to think about areas already in the UGB but available for development, it slows the rate that farms are converted to housing and prevents leap-frog developments.

Is there a limit to how far the UGB can expand?

Well, the Pacific Ocean makes a good buffer. And, at 60 miles away, that’s closer than the most distant suburbs of Los Angeles, San Francisco, Seattle or Phoenix are to their downtowns.

In theory, the UGB could expand in perpetuity, but the reality is that for the next 50 years, the UGB is unlikely to expand beyond the 23,000-or-so acres of urban reserves around greater Portland.

Can the UGB expand because one of the region’s 24 cities is growing particularly quickly?

It can, but only under certain circumstances – primarily, that the city must show that it has a plan to support new development on newly urbanized land, and that the region as a whole needs more acreage for development. More on that below.

The Metro process

What’s the urban growth report?

Every six years, Metro has to put together a report on growth in greater Portland – how much we’ve had, how much we expect, where people are living, and how much land there is for future development. It’s a complex, peer-reviewed snapshot of growth in the metro area, aimed primarily at calculating how much land is needed for 20 years of future growth.

The last urban growth report was done in 2015, and was heavily informed by the budding surge in apartment construction in greater Portland. It found that the region easily had enough land to accommodate 20 more years of growth.

Suburban leaders and developers were somewhat skeptical of the apartment boom, and asked Metro to revisit the UGB in 2018, three years earlier than usual. The Metro Council agreed to do that, and here we are.

The apartment boom hasn’t stalled, but it’s clear that home construction hasn’t kept pace with growth. That probably isn’t due to a land shortage, but it’s still weighing heavily on the minds of leaders across the region as they look at the UGB next year.

The South Hillsboro area was added to the UGB in 2011. Hillsboro leaders want to add another part of the South Hillsboro urban reserves to the urban growth boundary.

How does Metro pick where to expand the UGB?

It helps to start with a history lesson here. Historically, Metro had to put any new UGB expansions on the lowest quality farmland around the area. Oftentimes, that meant rolling hills and deep ravines – areas that were absurdly expensive to connect to pipes and roads. It led to the massive 2002 urban growth boundary expansion in Damascus, an area that still has only seen limited development in the 16 years since.

Other areas that were added to the UGB in 2002, like North Bethany, have had more success urbanizing – but it literally took more than a decade to get the pipes and roads paid for and built to serve any new growth.

In the late 2000s, Metro, developers, land conservation advocates and state leaders agreed that the system needed significant reforms. They spent four years hashing out a 50-year growth map, designating “urban reserves” – areas that Metro would target for UGB expansions through 2060 – and “rural reserves,” which were areas that would be off limits to urbanization in that time.

Some of those urban reserves were on high-quality farmland, a tough pill for land conservation advocates and farmers to swallow. But it was a compromise deal that many felt was imperfect but few found terrible.

Now, when Metro expands the regional UGB, it must first target urban reserves for expansions.

The 2018 analysis

What’s new in this year’s UGB review?

In 2016, Metro Council President Tom Hughes set out to make more reforms to the UGB review system, in an effort to jump-start development on UGB expansion areas. Remember, it was taking upwards of a decade, and often longer, to see ground broken for housing on UGB expansion areas, even in the best circumstances.

The reforms proposed by Hughes’ regional task force, and adopted by the state legislature, had some major changes. Most significantly, Metro could make smaller adjustments – up to 900 acres – to the urban growth boundary midway through the 6-year review cycle without needing to do a full urban growth report. That would allow the council to help cities that had a “stars are aligned” opportunity for new housing developments within the region’s urban reserves without waiting the full six years for permission to build.

Where might the UGB expand this year?

Five cities have told the Metro Council they might be interested in urban growth boundary expansions this year:

Hillsboro, which is asking for 150 acres for housing near its existing South Hillsboro development,

Beaverton, which is asking for 1,200 acres for housing in the area of Cooper Mountain,

King City, which is asking for 528 acres on the south side of Bull Mountain, to allow development of housing and a new downtown area,

Sherwood, which is asking for 660 acres west of Highway 99W, for housing,

Wilsonville, which is asking for 275 acres around Meridian Creek Middle School on the city’s east side, for housing.

Letters of interest from cities Five cities in greater Portland expressed interest in an urban growth boundary expansion in 2018. 12.36 MB Adobe Acrobat PDF Published Jan 19, 2018

How does the council choose?

In the past, the main factor for the Metro Council’s choice was picking the land that was most likely to survive an inevitable legal challenge. This year, based on the input from Hughes’ 2016 task force, Metro is mixing things up quite a bit, to account for the changing realities of development and financing.

Cities asking for an urban growth boundary have to show that they can get dirt turned quickly. How will they pay for pipes and roads? Is there likely to be a developer interested in building in the area? Does the area have a growth plan? Metro has directed grants to cities to help them answer these questions, but those answers need to be part of any application for a UGB expansion.

Also factors: affordability and racial equity. What are cities doing to support construction of affordable housing in their already-urbanized areas? Were diverse communities engaged in planning growth expansions? Those questions will be on the minds of the Metro Council when they decide which of the five applications to accept and send to state regulators.

When will decisions be made?

If city leaders in those five cities decide to press forward, they’ll have to submit a formal application to the Metro Council by the end of May. The council will review the applications over the summer, with a decision on a potential UGB expansion this autumn.

How can I be involved?

Start at the bottom up. Talk to city leaders in the five communities seeking a UGB expansion. Tell them what you like and don’t like about those proposals.

Once the formal applications are in, two groups have significant say in any UGB expansion: the Metro Policy Advisory Committee and the Metro Council. The former, known as MPAC, meets the 2nd and 4th Wednesday of the month at 5 p.m. at Metro’s offices in Portland, and consists of elected leaders from around greater Portland. The latter, which meets at 2 p.m. Thursdays at Metro, has to take MPAC’s advice into account but is not bound by MPAC’s input, as Metro councilors are directly elected themselves.