A fee exemption approved Wednesday by the Bend City Council could help bring as many as 100 affordable housing units to the city.

Wednesday, councilors approved an affordable housing exemption for system development charges, which are levied against new construction and are intended to reflect the cost of expanding infrastructure to accommodate new residents.

By reducing the cost of construction, the SDC exemption makes it possible for a developer to offer houses or apartments at a lower price than would otherwise be possible. Bend currently collects $4,928 in SDCs for transportation, $3,058 for sewers and $4,868 for water on a single-family home, with slightly lower rates for apartment units and other forms of multifamily housing. Eligible projects could receive a full exemption for water and sewer SDCs, and a 75 percent reduction in the fees for transportation.

Earlier this year, the city asked the Bend Park & Recreation District to join in the effort to spur the construction of affordable housing, but in June, the district board voted against creating an SDC exemption of its own.

The park district collects $6,013 in SDCs for every new single-family home built within the district.

Under the exemption approved by councilors Wednesday, the city would forgo collecting up to $1 million in SDCs over the next two years. Jim Long, the city’s affordable housing manager, said Thursday the city hopes the incentives will help build 15 single-family homes and 85 multifamily units.

To be eligible, developers would have to build rental units affordable to families earning up to 60 percent of the area median income, and owner-occupied units affordable to families earning up to 80 percent of the area median income.

Wednesday night, City Manager Eric King said the most recent calculations of Bend’s median income for a family of four is $59,400. Sixty percent of that figure is $35,640; 80 percent is $47,520.

Long said local residents shouldn’t expect to see affordable housing projects under construction soon. Most projects rely on a combination of state and federal tax credits and grants, he said, and it can take a long time for a developer to get all of the pieces in place.

“For most projects like this they’re probably going to be larger, tax credit type projects,” Long said. “So anybody who’s applying now, they’re probably going to be building next year. This is just one part of getting their project together.”

If the city receives more than $1 million in exemption requests, its affordable housing advisory committee will review the applications to select the most promising projects.

Long said that because developers of affordable housing depend on so many incentives and outside sources of funding, the park district’s decision not to create an SDC exemption shouldn’t be a significant deterrent to new construction.

Other measures approved by the city within the last year could have a greater stimulative effect than the SDC exemption, Long said, most notably a “density bonus” that would allow developers to build 50 percent more units than the zoning of their property would ordinarily allow, provided at least half the housing units are designated as affordable housing.

Two new park district board members have taken office since the board’s vote in June, and both said they would be open to revisiting the question of an SDC exemption.

The district has taken no action yet and has canceled all board meetings scheduled for August.

Board Chairman Craig Chenoweth could not be reached for comment Thursday.

— Reporter: 541-383-0387,

shammers@bendbulletin.com