HBA Drops Appeal on Construction Excise Tax Allocation

Home Builders Association

HBA Drops Appeal on Construction Excise Tax Allocation

The Home Builders Association of Metro Portland decides not to appeal court decision in lawsuit regarding Construction Excise Tax

In a meeting on June 28, 2012 the HBA Board voted not to petition the Oregon Supreme Court to review the recent Appeals Court decision issued on June 13 regarding its lawsuit against Metro on the 2009 Construction Excise Tax.

“While we believe in our position that this extended C.E.T. went beyond the original intent that was agreed to by our organization when it was originally approved by Metro in 2006, we also believe the greater need right now is to use whatever funding Metro will provide expansion areas to get them ready for development” said HBA 2012 President, Gordon Root with Root Holdings. “There are also several cities who want to prepare for the next Urban Growth Boundary (UGB) review that need funding from this C.E.T., and delaying their access to the funds could weaken their ability to do this needed planning.”

The original C.E.T., a tax on all new construction in the Metro area, was done with HBA’s agreement back in 2006 in order to provide funds for cities to do concept planning in areas recently brought into the UGB.  As that one was expiring in 2009, Metro sought agreement to expand the use of the tax to provide funds for planning numerous other projects within existing jurisdiction areas. HBA disagreed with this use, stating that was not the original intent and that it would reduce the limited supply of tax funds available to help get new UGB areas jump-started for development.

“HBA supports infill and redevelopment. We just believe there are other funding sources available for these projects, and that the limited C.E.T. funds need to be used for planning UGB expansion areas and getting needed future urban reserves ready to be considered for development,” said HBA CEO, Dave Nielsen. “We’re hopeful that, going forward, Metro will work to allocate more funding to areas recently brought in to the UGB to help get them ready for development, as well as to allocate funds to jurisdictions who have local aspirations for employment and housing growth in their community.”

“We’re in a critical time right now with a shortage of developable lots. While we remain concerned with the use of the C.E.T. for other projects not related to expansion areas, the bottom line is we need to move forward and help cities be able to bring land online. It will benefit the industry, create jobs, and help meet the housing and employment needs for our region,” said Matt Wellner with Metropolitan Land Group, HBA 2012 Government Relations Chair.

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