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SDC Exemption for Home Ownership

Information
The SDC Exemption Program has different requirements dependent on whether the exempted unit will be sold to home buyers or rented. This page covers information for builders who intend to sell the exempted unit.
On this page

Administrative Rules


System Development Charges

Read about how SDCs are charged as well as current rates for new development, additions, and changes of use.


Program Requirements

Eligible Developments

To be eligible for the SDC Exemption Program, the applicant must have an active building permit application as well as ownership of the property. The proposed development must meet the affordability requirements per Title 30.01 – Affordable Housing Preservation, Chapter 30.01.095 including the following:

  • Homebuyer income limit: 100% AMI or 120% MFI*
    *Applications submitted for SDC exemptions prior to March 1, 2024 for homes that sell prior to July 1, 2026 are allowed to sell to homebuyers earning up to 120% of the Area Median Income (AMI) for a family of four (currently $140,280 and adjusted annually) and adjusted upward for households of more than four people.

    Developments that do not meet the criteria listed above must serve households at or below 100% of the AMI for a family of four (currently $116,900 and adjusted annually) and adjusted upward for households of more than four people.
  • 2025 Sale price cap: $455,000
    Units must sell for less than the price cap (updated annually).
     
  • Sales must be arm's length transactions. An arm’s length transaction is one in which the buyer and seller act independently and have no relationship (by blood, marriage or unrelated business dealings) to each other. An arm’s length transaction will be fair and equitable to all parties and will result in a fair market price.
     
  • Occupancy: Units must sell to homebuyers who will occupy the homes as the initial occupants and who will continue to live in the homes. Properties receiving homeownership exemptions may not be rented.

Compliance Requirements

The Portland Housing Bureau (PHB) requires the applicant to comply with the terms and conditions outlined in their recorded Regulatory Agreement (view sample) per Title 30.01 – Affordable Housing Preservation, Chapter 30.01.095

Homes approved for SDC exemptions must be sold to income-eligible homebuyers who will occupy the homes as their primary residence. Income is evaluated based on a homebuyer’s current annualized income. If a property is sold to an ineligible homebuyer or over the sale price cap, the developer must repay the exempted SDCs plus interest and fees to the city of Portland SDC Bureaus and PHB.

Process Steps for Home Ownership Project Compliance Requirements:

  1. Homebuyer completes and signs the Homebuyer Compliance Verification Form and submits it along with supporting income documentation to PHB for review prior to the sale of the property. This must be submitted at least 10 days prior to closing.
     
  2. If it is known that the homebuyer will not meet the requirements, the escrow officer submits an SDC Repayment Demand Statement Request Form to PHB to request a demand statement detailing the repayment amounts prior to closing.
     
  3. PHB reviews the forms and supporting documents and then emails a demand statement to escrow disclosing whether or not the homebuyer meets the affordability requirements and indicating if any repayments are due. PHB demand statements are valid for 90 days.
     
  4. There is a $1,000 processing fee per property sold, which is due and payable at closing.
     
  5. Escrow officer collects and pays the applicable amounts of any repayments due.
     
  6. Once PHB receives proof that the SDC Bureaus have been repaid and/or the property has sold to the verified homebuyer for the current price cap or less, PHB records a Release Agreement and the SDC Exemption Program requirements are released.

(1) The amount exempted in the Regulatory Agreement is an estimate only; do not use this figure to calculate repayments. Only a Demand Statement from PHB will list the correct repayment amounts. 

(2) Any repayments due in the case of non-compliance will be charged a $1,000 processing fee by PHB and an additional processing fee by each bureau requiring repayments. Repayments will be due based on the rate that was in effect at the time the complete building permit application was submitted, plus interest (currently 6.2%, based on the city’s interim rate effective as of February 7, 2024).


Apply for SDC Exemption

Builder application
*This form is for Homeownership Projects only. Projects subject to Inclusionary Housing use a different form. View IH Forms here.

For projects with more than one unit, download and complete this workbook to submit with the application.


Additional SDC Forms and Documents

New online forms available!

Homebuyer Compliance Verification Form

SDC Repayment Demand Statement Request

For printable versions of the forms, contact indirect@portlandoregon.gov. Please be aware this may delay processing.

Subsequent Builder

Examples


How to submit forms

  • If an online form is available, submit online (Most recommended). There will be a spot to upload your supporting documents.
  • Printable forms and follow-up supporting documents: Email, or as alternatives, mail, fax, or drop box. Please note, paper forms may affect how quickly we can receive your application.
  • In person drop-off: PHB front desk, on the 7th floor, is open during regular business hours. If you have questions, please send us an email.
  • Drop box: Look for the gray mail bin located in the building lobby, labeled "Portland Housing Bureau."

Questions

Best way to reach us is by email or phone.
indirect@portlandoregon.gov
503-823-3270

PHB is operating hybridly. Program staff are only in the building on certain days of the week.
Book in-person appointment (Tuesdays and Thursdays)

Get directions to PHB
1900 SW 4th Ave, 7th floor

Contact

SDC Exemption Program for Home Ownership

Program Staff
phone number503-823-3270Please note, this is for Home Ownership only. For questions about SDC exemptions for Rentals, visit the Inclusionary Housing page for the appropriate contact.
fax number503-865-3479
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