BMPRD SDC Increase
Park SDC increase will hurt bend's economy
Bend, OR, Jan. 20, 2009: The Bend Metro Park and Recreation District's proposed 100 percent increase in its system development charge will negatively impact the housing market and create another drag on the local economy, according to the Central Oregon Association of Realtors®.
"This huge increase, in what is essentially a tax, will reduce the number of new home buyers we would otherwise see in Bend," said Bill Robie, Government Affairs Director for COAR. "For our economy to recover we need to see more home buyers, not fewer." "We understand the challenges the Park District has faced in the past with rising land costs due to the city's failure to expand its UGB. By their nature, SDC calculations rely on past experience. But times have changed and will continue to change. Land and construction costs will be lower going forward due to slower growth and, eventually, an expanded UGB," Robie added. He emphasized, "This is the wrong time to be revising the SDC and increasing the burden on home buyers. Given local economic conditions we question the wisdom of increasing taxes on consumers at this time."
The proposal being considered at tonight's public hearing is not the recommendation that came from the SDC Advisory Committee, which convened over several months last year. COAR was represented on that panel. Robie said," The BMPRD Board of Directors has chosen to take up the staff's recommendation rather than the committee's recommendation, which was $2,000 lower. We also disagree with some of the BMPRD's assumptions that go into the SDC calculation. The Park District does not factor in to its needs analysis the availability of outdoor recreation assets on the thousands of square miles of public land surrounding Bend. By unrealistically assuming that the district must meet every recreational need for Bend citizens, the BMPRD overestimates the real need for city park facilities. This results in an excessive SDC."
"The issue of whether a park SDC is an equitable and efficient means of paying for park facilities is another point of concern for us," Robie said. "The BMPRD likes to say that the park SDC is the cost of growth being applied to new residents. That's not true. The SDC is paid by purchasers of new homes – regardless whether they will ever use park facilities. Most purchasers of new homes are already residents in their communities so they are not placing any new demands on the park system. In effect, anyone purchasing a new home ends up subsidizing park facilities for the rest of the community."
COAR believes that the most efficient and effective way to provide recreation infrastructure is through broad-based funding. Robie pointed out that, "The entire community benefits from growth and should be willing to pay for the infrastructure required to maintain a healthy and dynamic community. The cost of growth is the price we pay for new and better jobs, new businesses, new employees, new taxpayers, new amenities and a greater level of prosperity for all citizens." "Central Oregon's economy is, for better or worse, still driven by real estate development and construction. We want to diversify the economy and expand the economic opportunities for everyone. But that won't happen until the housing market recovers. We are very concerned about local government policies that want to increase the burden on home buyers and exacerbate our legendary housing affordability problem," Robie said. "COAR hopes the Park Board will reject this SDC increase and make do with its current revenue stream. Just like everyone else must do in these tough times."
The Central Oregon Association of REALTORS® is the voice of the real estate industry in Crook, Deschutes, Jefferson and Harney Counties. COAR serves REALTORS® by maintaining ethical standards, providing continuing education, promoting the value of REALTORS®, and advocating on behalf of the real estate industry. Central Oregon REALTORS® believe we can build better communities by supporting quality growth and seeking sustainable economies and housing opportunities that embrace the environmental qualities we cherish, while protecting a property owner's ability to own, use, buy, and sell property.