The region is now beset with a housing shortage and an increase in homelessness. How will it respond as it continues to grow?
BEND, Ore. – Sarah Kelley is exponentially busier than she was four years ago.
Kelley is the executive director of Thrive Central Oregon, a nonprofit based in Redmond that helps impoverished people access services they need to become more self-sufficient, including free clothing for school-aged children, emergency food boxes to help food stamps stretch, and assistance with utility payments.
When Thrive opened in 2014, Kelley saw fewer than a dozen clients a month. The nonprofit now helps 175 people each month, Kelley said, and 80 percent of Thrive’s work now revolves around a single issue: helping clients find affordable housing.
The majority of Thrive’s clients live on tight incomes: seniors and disabled people on fixed monthly Social Security benefits, single parents, and the working poor – people who have one or multiple jobs, often minimum wage, getting by paycheck to paycheck.
Ten years ago, Kelley said, she could find a studio apartment that would rent for $400 a month. Even seven years ago, she could find such an apartment.
That is no longer the case.
“We rationally plan out their homelessness,” Kelley said.
That sounds cold-hearted, but Kelley is being pragmatic.
In Central Oregon – Deschutes, Jefferson and Crook counties – the recession brought construction to a halt, and workers in the industry moved away. That stagnant housing market was followed by rapid population growth and a booming economy, pushing housing costs to far beyond wages. The vacancy rate for both rental and for-sale housing is estimated to be between zero and 1 percent. Between 2011 and 2016, Bend and Prineville had some of the fastest-growing rents in the country, with average rental increases of 54 percent and 46 percent, respectfully.
For decades, Central Oregon has undergone demographic and cultural changes of breathtaking magnitude. Since the 1990s, Deschutes County has been one of the nation’s fastest-growing counties, with more than 100,000 people moving to the area between 1990 and 2015. That’s a population increase of 230 percent.
The region is no longer completely rural and dominated by a timber industry. New residents are drawn to the region’s quality of life, natural beauty and recreational activities. Bend, with a population approaching 100,000, acts as a hub to the smaller, still rural towns that are all interdependent.
FURTHER READING: Rural Oregon experiencing one of the worst housing crises of our lifetime
City governments have been aggressive, enacting multiple policies to incentivize more housing construction, but there is still a shortage: Bend alone lacks 4,700 units affordable to households earning less than $25,000 per year. Government and public policy officials vocally fear that if that shortage persists, Central Oregon will become a place where anyone who is poor or working class cannot afford to live.
Homelessness is on the rise, and the lack of shelters and supportive housing has forced the vast majority of homeless people to camp in the juniper forests surrounding their hometowns.
“We have had housing crunches in the past, but this is the biggest one we’ve had,” said Scott Aycock, the community and economic development manager of the Central Oregon Intergovernmental Council, an interregional governmental body. “It’s getting everyone’s attention.”
COIC’s most recent five-year Comprehensive Economic Development Strategy, approved in August 2017, identified housing affordability and availability as the region’s top priority to ensure sustained economic growth.
Today, the Great Recession is a thing of the past. In 2016, according to the most recent data from the Bureau of Economic Analysis, the local gross domestic product grew by 8.1 percent. Wages grew by 3 percent.
The economy has diversified, with growth in construction, manufacturing, health care, high tech, biotech, brewing and distilling, and the construction of Facebook data centers. Oregon State University continues to expand its Cascade campus, and Bend’s downtown core, like Redmond’s and Sister’s main streets, bustle with residents and tourists alike visiting breweries, restaurants, art galleries and coffee shops.
But the benefits of those changes are not available to everyone.
What does it mean to rationally plan out a person’s homelessness? To Kelley, it means looking at the different options available to each person.
It can take up to two years for someone on the waiting list to receive a Section 8 voucher, which pays two-thirds of the rent for qualifying low-income people. That, Kelley said, becomes the “long-term plan.”
In the meantime, she sits down with clients and asks: Can you get into a shelter? Is there family you can live with? Could you find a housemate on Craigslist?
According to the 2017 Point-In-Time count published by the region’s Homeless Leadership Coalition, there are 1,455 people living homeless or “precariously housed” in the Central Oregon counties of Deschutes, Crook and Jefferson. One out of three is unsheltered, meaning camping or living in a car.
Still, those figures are widely considered low. The count’s methodology relies on people appearing in person at social services agencies, food kitchens and other places homeless people frequent on the days of the count. So, the count’s numbers do not necessarily reflect the large numbers of people thought to camp in the outskirts of town, including the estimated 400 people thought to be camping east of Antler Avenue in Redmond.
There are few shelter options available for Central Oregon’s homeless. The Bethlehem Inn and the Shepherd’s Door are the only year-round shelters in Central Oregon, and each offers less than 100 beds. The homeless people who stay in the shelters must be sober when they arrive and cannot bring their pets with them.
So, finding housemates via Craigslist, in a town where people are used to living independently, “becomes a nice enough option. Better than shelter, better than camping,” Kelley said.
Those various options get stitched together – shelter for a few months, a housemate situation for a few months, “to fill the gap between homelessness and their own apartment,” she said.
“People come in thinking they’re going to be living in a tent for a year and a half,” Kelley said. “It ends up feeling hopeful.”
Central Oregon’s current housing crisis has its roots in the recession.
Unemployment surged to 25 percent. Nearly all housing construction ceased – between 2009 and 2012, no permits for multi-family housing were issued; less than 100 permits for single-family homes were issued each year in Bend during that time.
The region’s population, however, continued to grow: 3,100 people moved to Deschutes County during the recession.
Housing construction began to rebound in 2012 and the housing crisis Central Oregon experiences today is a classic story of supply and demand.
Since 2012, according to a report by economic consulting firm ECONorthwest, the median price of homes has grown, on average, by 14 percent each year in Bend. The median sale price of a home in Bend, according to the Redmond-based real estate company Beacon Appraisal Group, was $418,000 in 2017, a 39 percent increase from 2016. In Redmond, home sale prices increased by 52 percent, to $306,000. In Sisters, a town with the population of about 2,600 people, the median home price is $365,000.
“If you see something (for sale) in the mid-two-hundreds, it’s pending within an hour,” said Brant Kucera, the city manager of Sisters. “It’s nuts.”
According to the ECONorthwest report, a homebuyer would need to make approximately $81,000 a year to afford an average-priced home in Bend. The city’s median income is $59,400.
“Nobody has that,” said Jim Long, former manager of Bend’s affordable-housing program.
For renters, the prospects of finding affordable housing are equally grim, if not more so. Nearly 80 percent of renters are rent burdened, meaning more than a third of their incomes go toward rent.
The vacancy rate is considered to be less than 1 percent. Rent for a one-bedroom apartment in Bend can be as high as $1,200 a month, exceeding what the median renter can afford.
Years ago, Central Oregon was a place where housing was affordable, and even people in poverty could get by. For families that have experienced poverty for generations, today’s housing crisis poses a new threat.
Jennifer Summerton is an advocate with the Family Access Network, a social service agency that provides basic needs to schoolchildren and their families: “Everything,” Summerton said. “It’s the gamut of whatever they face.”
That can be as simple as getting free school supplies or clothes to applying for the Oregon Health Plan, finding a doctor or a counselor, applying for utility or rental assistance, or finding a new place to live.
Summerton, like other FAN advocates, works in two schools – in Summerton’s case, Redmond’s John Tuck Elementary School and Tom McCall Elementary School.
She is working with a family of six – two parents and four children under the age of 8 – who live in a studio apartment. Both parents work full time at minimum-wage jobs. “It’s what they can afford and what they can find,” she said.
Another woman, who had been a longtime donor to FAN, came to Summerton recently. She told Summerton she knew a woman who was homeless, living in her car, had no gas and could not drive to a job interview. She asked Summerton for a gas card that she could give to her friend.
Summerton soon found out that the woman and the woman’s friend were the same person.
“She was reticent to tell even me,” Summerton said. “She had no idea where to go. She was completely shut down as far as what to do.”
The housing crisis does not only affect the most impoverished. People with full-time jobs who could have afforded housing on their wages a few years ago no longer can.
FURTHER READING: In Central Oregon, the jobs are there, but the homes are not
Mariah Tennison, 19, graduated from Mountain View High School last June. Born and raised in Bend, she knew she wanted to continue living in her hometown. She is studying criminal justice at Central Oregon Community College and works part time at Goody’s, a family-owned chocolate and fountain shop that has operated in downtown Bend for decades, making minimum wage, $10.25 an hour.
Tennison still lives with her parents, as do most of her friends who have stayed in Bend. Ever since she turned 18, she has wanted to move out. Her parents “want me to move out, too,” Tennison said. “But I can’t. There’s nowhere to move to.”
She’s driven around and looked online for apartments. She can’t find anything affordable.
“For a studio apartment, it’s at least a thousand dollars. It’s crazy,” she said.
Chris Frye, 37, is the dock boss of Central Oregon Irrigation and Feed, another decades-old business that supplies the area’s ranchers and farms with hay, feed and other supplies. He makes $15 an hour and works full time but lives in an RV park in Crooked River Ranch.
“Everything is so astronomically expensive,” he said.
He rents a space in the RV park for $480 a month and also pays for electricity and water.
“I’m scraping by,” he said.
And people continue moving to Central Oregon – despite the well-known unavailability and high cost of housing.
“I’m just baffled,” Summerton said. “They show up in the middle of a winter, in a fairly harsh climate, with no jobs and no housing plans – no plan at all. They assume that it’s going to work out.”
Central Oregon “has great recreational opportunities, and it’s pretty, and it’s small, and the schools are good. I see that,” Summerton said, but “you can’t just move here.”
The lack of affordable housing has begun to create a domino effect of displacement. People who lived, or wanted to live, in Bend move to Redmond 16 miles away. People who lived in Redmond move to Sisters, 20 miles to the west, or Prineville, 20 miles to the east, or LaPine, 50 miles south.
That adds a round-trip commute of at least 45 minutes. A bus ticket for a ride from Prineville to Bend costs $10.
“That’s real money that hits (people) in the pocket,” said Preston Callicott, the CEO of Five Talent Software, a Bend-based software development company.
On March 20, Housing Works, the housing authority that provides federally subsidized housing in Central Oregon, broke ground on Village Meadow Apartments, a 48-unit apartment complex that will include 32 one-bedroom apartments, eight two-bedroom apartments, and eight three-bedroom apartments.
All the units will be affordable to people who make 60 percent of the area median income, or $38,400 a year for a family of four.
The city of Sisters contributed $300,000 to the project, approximately 6 percent of the city’s annual general fund.
Kucera, Sister’s city manager, said the expenditure is indicative of how serious an issue Sisters considers affordable-housing development.
“How many cities of 2,500 in Oregon take $300,000 out of their general fund to make sure that affordable housing developments get built?” he said.
In the last two years, an average of 120 residential building permits have been issued each year in Sisters – a record number.
The city has a policy akin to inclusionary zoning, which requires developers to set aside 10 percent of development as affordable to people who earn 60 percent of area median income.
That means that, roughly, a dozen units of affordable housing are being built each year in Sisters. That does not sound like much, but Kucera said it’s significant for the community of 2,573.
“This is definitely going to be the most affordable housing we’ve seen come online probably in our history,” Kucera said.
Like Sisters, other cities have enacted measures to incentivize affordable-housing construction.
In 2006, Bend was the first city in Oregon to create a construction excise tax, which added a 1 percent tax on each city-issued building permit. The revenue is dedicated to the city’s Affordable Housing Fund, which helps fund housing projects affordable to people who make 80 percent of the area median income or less.
At the time the tax was created, Bend’s housing market was white hot. Lynne McConnell, Bend’s affordable-housing manager, said that even in 2006, “it was getting incredibly challenging to keep any form of affordability in the market.”
“To some degree, it was like throwing spaghetti at the wall,” McConnell said. “What can we do as a city to help this?”
The tax has generated $7 million since its creation and has helped fund the construction of 770 units. According to the city, the funds have leveraged more than $77 million in state and federal funds, as well as $28 million in private equity.
More recently, as of Dec. 1, the city of Bend is waiving all city system development charges, or SDCs, for affordable-housing projects. SDCs, which can run up to $22,000, are charged for each building built in Bend and help pay for the added strain on city utilities, including sewer, water, roads and parks.
In 2015, Bend changed its zoning laws to allow for the construction of cottage-cluster style housing, single-family homes that would be about 1,000 square feet in size, with two bedrooms and one bathroom, with a shared front yard and shared parking area.
Bend also changed its zoning laws so that accessory dwelling units can be built on lots that already contain single-family homes.
The city also has a density bonus in place, allowing developers to build 1 1/2 times more densely if half the housing built is affordable to 80 percent of the area median income for homeowners and 60 percent of AMI for renters.
Two years ago, Sisters raised its hotel tax by 1 percent and dedicated a third of that percent to affordable housing.
“It’s not a ton of money,” Kucera said. But every cent – and every unit – counts.
In 2006, Bend applied to the state’s Department of Land Conservation and Development to expand the city’s urban growth boundary by 8,800 acres.
After a protracted process of back and forth between the city and the state, the state approved an urban growth boundary expansion of 2,380 acres. To prevent urban sprawl, the state mandated that Bend build more densely, especially in nine “opportunity areas” that have land for infill development.
Those who hoped that more land would allow for more housing and ease Bend’s affordable-housing crisis were crestfallen. But there are those who think that it is ridiculous for Bend to not be more dense, given its size, and view denser construction as an opportunity.
“The highest building in Bend is five stories. We’re the fourth-largest city in Oregon. What’s wrong with buildings that are 10 stories tall?” said Long, Bend’s former affordable-housing manger.
Mixed-use buildings, which often include retail businesses on the bottom floor and apartment units on the top floors, are still a relatively new phenomenon in Central Oregon. Many look to projects like Putnam Pointe, a five-story building in downtown Bend with retail businesses on the lower level and four stories of one- and two-bedroom apartments, as a model for affordable housing for the future.
“We need housing for the workforce, period,” Callicott said. “We need affordable housing for people of all economic strata. You can’t build a single-family home for a family that makes $37,000. It doesn't have to be HUD housing. It has to be smart.”
As Central Oregon government and public policy continue identifying ways to incentivize more construction, there is a growing chorus of service providers, outreach workers and activists who want to create a city-sanctioned camp or tiny-house village for at least a portion of Central Oregon’s homeless population to safely camp and access services.
On Feb. 23, Sally Pfeifer, the owner of the drug and alcohol counseling service Pfiefer & Associates, started a warming shelter for up to 30 people in her offices.
The warming shelter is only open when nighttime temperatures dip below 32 degrees. It’s bare bones: mats on the floor from 8 p.m. until 7 a.m. in a space used for group therapy during the day.
On March 7, she sent an email to dozens of elected officials, social service providers and advocates.
“Please take this all into consideration as you walk around downtown for your evening fun and meals,” Pfeifer wrote. “Are there less people to walk over? Are there less frightened tourists and community members? Is there more time for officers to do other things than chase homeless people from one door jamb to another, which they hate doing?
“Everyone has voiced their support for a solution to the homeless crisis,” the email continued. “We are now getting a taste of how a homeless village could benefit the community of Bend. … There are solutions.”
More than anything, people in Central Oregon fear becoming another Aspen, Colo. – the chichi resort and mountain town “where no cop, no firefighter, any service (worker) can live in the community that they’re serving,” Callicott said. “That’s ridiculous.”
Correction: This story was changed to correct a quote by Preston Callicott, the CEO of Five Talent Software. Callicott correct quote is: "It doesn't have to be HUD housing. It has to be smart.”
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