A new Portland financial incentive designed to boost housing construction is showing early signs of progress, according to a report released Feb. 27 by Portland Permitting & Development.
The program temporarily exempts many new housing projects from system development charges, or SDCs, with the goal of encouraging construction of 5,000 new housing units over three years.
City officials say projects representing about 1,720 housing units have entered the development pipeline, accounting for roughly 34% of the program’s target.
“The number of units in the pipeline is an encouraging early indicator that this temporary SDC exemption program is achieving what it intended: to make it easier to build new housing in Portland and to reduce financial barriers for those builders,” said Donnie Oliveira, deputy city administrator for community and economic development.
SDCs are fees typically charged to developers to help pay for infrastructure needed to support new growth, including sewers, parks, transportation systems and water services.
The temporary exemption allows qualifying residential development projects to move forward without paying those fees upfront. City leaders say the policy is intended to reduce development costs and help encourage more housing construction during a period when many projects have stalled.
The incentive applies to most housing permits issued between Aug. 15, 2025, and Sept. 30, 2028. To qualify for the exemption, developers must meet certain eligibility requirements and reach construction milestones within one year of receiving a permit.
The first report on the program covers activity between Aug. 15, 2025, when the policy took effect, and Jan. 15, 2026.
During that time, 265 housing units reached construction milestones required to permanently qualify for the exemption, representing several million dollars in waived development fees.
Additional projects are still progressing through the permitting process, with hundreds of units moving toward construction.
City officials say the program is intended to help jump-start housing construction at a time when development activity has slowed due to rising building costs, financing challenges and other economic pressures affecting the housing market.
While the early numbers show some momentum, officials say it will take more time to determine whether the program can meet its goal of encouraging 5,000 new housing units.
The city plans to release a more detailed report later this year evaluating the program’s first full year of implementation.
