Early data on Portland’s system development charge waiver shows mixed permitting trends and growing revenue impacts

A three-year fee exemption aimed at jump-starting housing

Portland’s temporary waiver of system development charges (SDCs) for many new housing projects is showing early signs of increased developer interest, while leaving open questions about whether it is accelerating overall construction. The program was adopted by the City Council in July 2025 and applies to qualifying permits issued from August 15, 2025, through September 30, 2028. City leaders set a headline target of 5,000 new housing units during the waiver window.

SDCs are one-time charges assessed at permit issuance to help pay for infrastructure and services required by growth, including sewer, water, transportation and parks. City documents describe average SDC costs of roughly $20,000 per unit, with typical ranges varying by housing type and project scale.

What the first five months show

A city memo covering roughly the first five months of implementation described “promising results” and pointed to month-to-month improvements compared with 2024 in some categories. The same reporting period, however, also showed that total new housing permits issued did not clearly exceed the prior year’s pace.

For the first five months after launch, Portland issued permits for 531 new housing units. Over the same five-month span in 2024, the city issued permits for 869 units, a difference of 338 fewer units year over year. City reporting also highlighted that October 2025 posted a year-over-year increase in permitted units compared with October 2024, while other months in the period showed declines when compared with 2024’s permitting totals.

• Permits issued: 531 units in the program’s first five months.

• Year-over-year comparison: 338 fewer permitted units than the same period in 2024.

• Waiver use within permitted units: waiver requests covered 206 of the 531 permitted units.

Pipeline activity versus construction starts

Separate from permits actually issued, city officials reported receiving waiver-related requests tied to projects representing up to 1,720 proposed units since the policy took effect, or about 34% of the 5,000-unit goal. Early updates also noted that only a limited share of those projects had moved into active construction, a distinction that matters because permits and pipeline applications do not guarantee groundbreakings.

City reporting has framed the growing pipeline as an early indicator of improved feasibility for some projects, while acknowledging that the evidence is not yet sufficient to show a decisive change in construction outcomes.

Budget stakes for parks, transportation and utilities

The waiver is designed to reduce up-front costs for homebuilding, but it also reduces revenues that typically support capital and service needs across multiple city bureaus. Early estimates tied to the policy projected foregone SDC revenues of about $63 million over three years if construction proceeded at baseline rates. Officials indicated that if early permitting activity and pipeline projects advance as anticipated, waived fees could reach roughly $32 million based on initial months of activity.

Next checkpoints

The ordinance requires written implementation reports to City Council every six months for the duration of the waiver. Those updates are expected to track unit characteristics, permitting trends against prior years, progress toward the 5,000-unit goal, evidence of stalled projects reactivating, and the estimated value of fees waived by bureau. City Council is scheduled to review early results at a Housing and Homelessness Committee meeting in the coming days.