Construction boom ensued when Portland exempted accessory dwelling units from costly development charges

Portland homeowners who want to add a granny flat or mother-in-law apartment on their lot may have another three years to avoid the city’s high development fees.

City Commissioner Dan Saltzman wants to extend the city’s experimental waiver of systems development charges another three years, for people adding accessory dwelling units. Those fees can add $7,000 to $13,000 to the cost of building accessory dwelling units, an unusually large percentage of overall construction costs for the small housing units.

Portland has a policy of encouraging the addition of accessory dwelling units by allowing them on most single-family lots. But relatively few homeowners have built them, at least legally, in part because of the stiff development fees.

Since the fee waiver took effect in April 15, 2010, homeowners and builders have taken out permits to add more than 280 accessory dwelling units, or about one-sixth of all single-family residential permits issued by the city. The fee waiver was accompanied by an increase in maximum building sizes for accessory dwelling units, which can now be up to 75 percent the size of the main house on the lot, with a cap of 800 square feet.

Smaller dwelling units provide more affordable housing, reduce urban sprawl and often make it easier for residents to rely on alternative ways to get around without using cars.

Saltzman is proposing a resolution at Wednesday’s Portland City Council meeting to extend the fee waiver until July 31, 2016. The waiver will expire next June 30 if the waiver isn’t extended.

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