Hales Kills Demolition Tax
Friday, January 08, 2016
Hales last promised to bring the tax back during a council meeting in December. The idea had been introduced the measure numerous times, each time being modified after sustaining tough criticism.
It was designed to hinder the “demolition crisis” that many resident and neighbor groups have claimed are ruining the city’s aesthetic appeal.
"Growth is creating a lot of positive things in Portland, but I'm less happy with the demolition of great old houses that are being replaced by more expensive ones," Hales said at a hearing regarding the tax in December.
As GoLocal reported, Hales originally proposed a $25,000 tax on any developer who tears down a home in September.
Hales’ faced difficulty in October, when he was forced to narrow the scope of that tax earlier this week and announced it would only be applicable for developers who replace one single-family home with another single unit. Developers who replaced a single home with a multi-family unit or apartment complex would be eligible for a full rebate of the tax.
In November, the December 2 vote was set. By that point, the newest incarnation of Hales’ tax showed similarities to the original measure.
The latest version would have enforced a $25,000 tax on all viable homes demolished and replaced with one or more new homes. Only homes being purchased by the city to restore flood plains and affordable housing replacement project would be exempt from the tax.
The failed tax had seen staunch opposition since its introduction. Some at the hearing complained that the tax would only serve to make homes in Portland more expensive.
The Oregon Home Builders Association previously argued that the tax is illegal, while United Neighborhoods for Reform, a neighborhood coalition, wanted a higher tax. Others warned of unforeseen consequences and worried that the tax would lead to more infill development.
An amendment proposed by Commissioner Steve Novice that would have reduced the tax for demolitions that would be replaced by less expensive homes was rejected by the City Council. Hales indicated that the amendment may be revised as the tax begins to be enforced.
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