The Oregon Capitol Building in Salem. Alan Sylvestre / OPB

Key Oregon legislators have reached a deal on a series of bills aimed at boosting the construction of affordable housing, an increasing white-hot political issue as rents and home prices have soared in Portland and many other cities.

THANKS TO OUR SPONSOR: Become a Sponsor

The four bills would lift the statewide ban against requiring developers to include affordable housing as part of major construction projects, provide a new tax source for lower-income housing and provide new protections to renters. In addition, one of the measures would also allow developers in many cases to annex their property to cities without having to get voter permission.

"It seems like most of the opposition has been erased," said John VanLandingham, a Eugene legal aid attorney and influential low-income housing advocate. "Right now the enemy is time," he added, noting that the legislative session is slated to end next week.

Perhaps the most significant measure is Senate Bill 1533, which would end the 17-year-old ban on what's known as inclusionary zoning, which low-income housing proponents have long touted as an important tool for increasing the supply of more affordable homes.

Under the deal reached among legislators, developers and housing advocates, local governments could require builders of multi-family units to choose among a range of incentives allowing them to build additional units in exchange for reserving some of their project for lower-income residents.

THANKS TO OUR SPONSOR: Become a Sponsor

In addition, the measure would also allow local governments to levy a 1 percent tax on new residential, commercial and residential construction that would help pay for the construction of lower-cost housing.

Inclusionary zoning "is not a silver bullet but it can really help in some cases," said state Sen. Michael Dembrow, D-Portland.

The measure was passed unanimously Tuesday by the Senate Finance Committee and now heads to the Senate floor. On the same day, the Oregon House passed a bill that would put further restrictions on rent increases.

House Bill 4143 would forbid rent increases for a tenant's first year and require 90-day notice of a rent increase after that. Currently, rents can be raised with a 30-day notice for tenants renting on a monthly basis. That measure now goes to the Senate.

The ban preventing local governments from using inclusionary zoning was approved by the 1999 Legislature at the behest of the Oregon Home Builders Association. The group and other critics have argued that these kinds of programs amount to a hidden tax on housing while doing little to expand supply.

But the home builders and other development groups agreed to accept the deal after they won concessions limiting how local governments can use inclusionary zoning. Among other things, cities or counties can't require that more than 20 percent of units be set aside for affordable housing.

Jon Chandler, the home builders' lobbyist and a key figure in developing the 1999 ban, said his group believes the new legislation gives them much more power to work with cities to guide how inclusionary zoning is used. He said his group also won concessions ensuring that any construction tax levied by local governments would be spent on housing.

Two other bills make changes in the state's land-use system. Senate Bill 1573 would largely prohibit public votes on voluntary annexations inside of urban growth boundaries. And House Bill 4079 would allow two cities to conduct pilot programs allowing 50-acre developments of affordable housing outside the urban growth boundary. Cities in the Portland area would not be able to participate.