Metro President Lynn Peterson Outlines Ballot Measure That Would Allow Use of Homeless Tax to Build Affordable Housing

Metro President Lynn Peterson on Friday morning released a much-anticipated outline for a ballot measure that, if referred to Metro voters and passed, would allow the use of revenue generated by the supportive housing services tax for building affordable housing, extend the tax until 2050, adjust the tax rate for inflation and lower the tax in 2031 from 1% to .75%.

At issue in the proposal is the supportive housing services tax passed by Metro voters in 2020 which placed a tax on high-income households to fund homeless services for 10 years. Metro administers the tax and the money is disbursed to Multnomah, Washington and Clackamas counties. The SHS tax imposes a 1% tax on income over $125,000 for single-filers and on income over $200,000 for joint-filers.

Despite the tax bringing in larger-than expected revenues every year, the three counties—and in particular Multnomah County—have struggled to spend the money on time. They’ve also struggled to combat homelessness.

Multnomah County spokesman Denis Theriault takes issue with that characterization, noting the county did a better job of spending its allocation last year.

“Those spending issues were true for the three counties the first two years of the measure, but that ended in FY23-24, when we spent all of the money we received from Metro and also began cutting the previous two years’ of carryover funding,” Theriault says. “And now this fiscal year, we are meeting our projected spending levels.”

Meanwhile, regional and state leaders have long harped on the shortage of affordable housing, and in recent years pledged to aggressively increase the stock. Business leaders and service providers saw in these dual challenges an opportunity: to ask voters to extend the tax, lower it slightly, and to be able to use the money to create affordable housing.

As WW reported in November, the Portland Metro Chamber and a group of large service providers told Peterson they’d reached a deal that pleased them both: a measure that would lower the tax rate to ease the tax burden on high-income earners, and also extend the tax until 2050 to ensure that homeless service providers weren’t cut off from a major funding source. At the time, the three counties through which the tax dollars flow to providers expressed hesitation about the measure, as did a separate group of providers. The counties are reluctant to cede control over the percentage of the tax dollars that Peterson wants to allocate to building new housing. And some providers oppose lowering the tax rate.

Peterson in her announcement on Friday morning did not provide details about what portion of the tax revenue she would like to be available for affordable housing. Another prong of her proposal is to set up an oversight committee responsible that has a “clear regional plan and clear metrics to track and report accomplishments and prompt changes to when needed.” (Metro already convenes an SHS oversight committee, composed entirely of community volunteers.)

The 7-person Metro Council will take a vote on whether to send Peterson’s proposal to the May 2025 ballot in the coming weeks. A simple majority is needed to place the measure on the ballot.