City Officials Consider Reducing Apartment Construction in East Portland

Jim Wallace is confused. All he hears about is Portland’s biggest issue: the city’s housing shortage.

Yet city officials are now considering a plan that would strip Wallace of his current ability to develop multifamily housing on his East Portland property.

“You can’t tell me you want more housing and rezone the property,” says Wallace, a property investor. “What’s the sense of this?”

For decades, Portland has pursued a strategy of combining public transit with dense, urban development in the center of the city and along major streets. But now, just as the housing crunch is reaching crisis proportions, city officials are considering a zoning change that would mandate less density in one of the most affordable parts of the city.

Wallace had hoped someday to develop the single-family house he owns at 10703 E Burnside St. into apartments—or sell it to a developer.

But now the city is considering “downzoning”—or reducing the allowable density of—a 240-acre patch of outer Southeast and Northeast Portland, mostly in the Powellhurst-Gilbert and Centennial neighborhoods.

Thirty acres of the proposed downzoning, including Wallace’s house, are clustered around the major thoroughfares of Southeast Powell Boulevard, Southeast Division Street and Northeast Glisan Street.

The reason Wallace’s house is being downzoned: The David Douglas School District, in which the property is located, has too many students.

“David Douglas schools are overcrowded,” says Eden Dabbs, spokeswoman for Portland Bureau of Planning and Sustainability. “While we’re helping them catch up, we’re going to concentrate growth in neighborhoods that already have amenities.”

City planners have been working away on how to squeeze more people into Portland, but they also want to reduce the development allowed on a small fraction—some 2 percent—of the city’s nearly 93,000 acres in favor of building in the core of the city.

The city is looking to increase density in the inner city—including in Richmond—and also along corridors such as Southeast Hawthorne Boulevard and Division and Belmont streets. So, in effect, the city will increase density—what some people call “upzoning”—in some areas while downzoning in others.

Wallace finds that difficult to swallow, because his property is right next to a large apartment complex and just three blocks from the MAX stop at Southeast 103rd Avenue and Burnside.

So-called transit-oriented development that allows people easy access to public transportation has been central to Portland’s planning for decades.

Wallace acknowledges he’s sore in part because the proposed downzoning would reduce the value of his property.

But there’s an open question about whether it’s necessary to sacrifice housing to limit overcrowding in nearby schools.

It’s true David Douglas schools are crowded. From 1996 to 2014, enrollment spiked from 7,260 to 10,823, an increase of 49 percent.

Portland Public Schools enrollment shrunk about 15 percent over the same period as families shifted east to take advantage of cheaper real estate.

But the number of students in David Douglas fell slightly this year—by just over 1 percent—as it did in five of the six east Multnomah County school districts.

“Is that a start of a trend or a blip? We’re at a moment when we’re not sure,” says David Douglas spokesman Dan McCue. “Nevertheless, our elementary schools are at capacity, and our projections suggest it’s just a blip.”

David Douglas needs both for more affordable housing and less crowded classrooms.

“We’re at a catch-22 right at the moment,” says David Douglas School Board member Frieda Christopher, who, along with district Superintendent Don Grotting, lobbied city officials to reduce development of new housing in her area.

Schools are currently so crowded the district reports 70 students in middle school gym classes, four to six lunch periods in elementary schools, and projections that two elementary schools will hit 800 students—200 more than the buildings can handle—by 2035.

While still cheaper than other parts of the city, rents are climbing in East Portland—in outer Southeast, according to Multifamily Northwest, the rent charged per square foot rose nearly 7 percent in just the six months between September and March.

The city’s leading demographer says population around David Douglas will grow no matter what.

“If David Douglas has a lull in enrollment growth, they still won’t have a lot of breathing room,” says Charles Rynerson, of the Population Research Center at Portland State University, who still projects that an uptick in building will fuel growth now that the recession is over.

Gentrification of the central city has pushed Portlanders east to David Douglas, and it might seem logical just to build new schools to accommodate the growth.

Easier said than done. In David Douglas, where 76 percent of students are poor enough to qualify for free or reduced lunch, bonds are more expensive for homeowners to finance because there are fewer commercial properties in the district and lower home values.

“There’s a limit to what voters can pay,” says Courtney Wilton, a former director of administrative services at David Douglas. “There’s no magic pot of money for school districts looking to build schools.”

In August, the Portland Planning Commission will vote on the plan to downzone the 30 acres that include Wallace’s property before it goes to the City Council for final approval.