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Welcome Home, a coalition of nonprofit service providers, including the Latino Network, the Urban League, Outside In and Cascadia Health, among many others, is urging the regional government Metro to reconsider its current plan for changes to the supportive housing services tax.
As WW previously reported, Metro is on a path toward referring a measure to the May 2025 ballot that would extend the sunset of the SHS tax by 20 years, from 2030 to 2050; would step the tax rate down from 1% to 0.75% over time; would index the tax threshold to inflation; and would allocate excess collections over a defined baseline of revenue to developing additional affordable housing rather than only paying for services.
Related: Business Group and Service Providers Reach Agreement on Changes to Homeless Services Tax
Here’s what Welcome Home would like Metro to consider:
1. No reduction in the tax: “There is no logical public policy argument for reducing the current 1% marginal tax rate on high-income earner households when our need for resources to address homelessness is still unmet,” the group’s letter says. Under the tentative deal reach by the Portland Metro Chamber and Here Together, a group of nonprofit providers, the rate would be reduced to 0.9% in 2026 and to 0.75% in 2031. Welcome Home says the beneficiaries of the tax need the support far more than the taxpayers need relief—which the letter says they are likely to get from the incoming Trump administration in the form of federal tax cuts.
2. Make the tax permanent, or extend it 25 or 30 (rather than 20) years: “Vouchers offering long-term rent assistance are serving people who can never reenter the workforce, such as seniors and people with disabilities, and so it is illogical to offer such a support and then terminate it if the goal is to keep people housed,” the letter says. Welcome Home says that a longer time horizon for the tax will also make lenders more comfortable. “We know from the experience of the past few years that affordable housing developers cannot successfully leverage the existing rent assistance with the current 2030 sunset,” the letter says.
Welcome Home is on board with some of the other proposed changes, such as indexing the tax threshold to inflation (it’s currently $125,000 for individuals or $200,000 for a couple filing jointly); beefing up accountability and oversight; and streamlining and standardizing contracting, a sore point for many providers. It also wants Metro to consider regular reviews of the tax rate every five to 10 years and include people who are receiving services in oversight of the spending.
One issue over which Metro and the counties—Clackamas, Multnomah and Washington—that receive SHS funding find themselves at loggerheads is the proposed diversion of funds to create new housing instead of using the money for services.
The coalition supports the use of some of the SHS money for housing but encourages the agency to be nimble—acquiring existing housing, for instance, which is currently often far cheaper than building new units, and considering “social housing initiatives seen in our jurisdictions that base affordability on tenant income, rather than area income.”
Metro, which hopes to finalize the concept it will refer to the May ballot later this month or in early January, says it will take the Welcome Home letter under advisement.
“We’re grateful for feedback on the work that we’re doing to address housing funding in the region,” says Metro spokesman Nick Christensen. “Our priority is addressing the urgent need for affordable housing construction in our region, and improving our supportive housing services system so that it can serve as many people as possible, as effectively as possible.”