Agenda Item - 2022-11-15 - Number 11.1 - Ordinance 2917, Affordable Housing and Deconstruction Incentives 11 .1
COUNCIL REPORT
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Subject: Residential Structure Demolition Tax Update (Ordinance 2916 I PP 22-0006)
Meeting Date: November 15, 2022 Staff Member:
Scot Siegel, Community Development Director
Report Date: November 7, 2022 Department: Community Development
Action Required Advisory Board/Commission Recommendation
❑ Motion ❑X Approval
❑X Public Hearing ❑ Denial
❑X Ordinance ❑ None Forwarded
❑ Resolution ❑
❑ Information Only Comments: Sustainability Advisory Board and Historic
❑ Council Direction Resources Advisory Board recommend approval
❑ Consent Agenda
Staff Recommendation: Conduct a public hearing and enact Ordinance 2916.
Recommended Language for Motion: Move to enact Ordinance 2916.
Project/ Issue Relates To:
▪Council Goals/Priorities
Conserve the community's quality of life by planning for growth and change.
ISSUES BEFORE COUNCIL
Issues include whether to:
• Remove the sunset on Ordinance 2831 (LOC 24.06 Residential Demolition Tax),
• Modify the incentives for affordable housing and deconstruction in LOC 24.06,
• Amend LOC chapter 45 (Building Code) to make deconstruction mandatory for structures
built in 1940 or earlier, and
• Exempt from the demolition tax all types of deed-restricted affordable housing, including
those exempt from system development charges.
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EXECUTIVE SUMMARY
The primary purpose of Ordinance 2831, Residential Demolition Tax was to raise revenue for
parks maintenance. It is a general tax—not a system development charge under ORS 223.297—
.314 or a construction excise tax under ORS 320.195. Section 3 of Ordinance 2831 is a three-
year sunset requirement (expires January 2, 2023).
The $15,000 tax applies to demolitions of residential structures, including single-family homes
and duplexes. Demolitions of dangerous/condemned buildings and demolitions for the purpose
of developing multifamily affordable housing are exempt. The rate was designed to meet the
Parks Department goal of raising $400,000 annually. As of September 2022, the tax, effective
Jan. 2, 2020, had raised $1,230,000. Thus, the average annual amount raised is on-track with
the original estimate.
The tax is reduced by $5,000 for projects that utilize a certified deconstruction contractor
(manual deconstruction) as an alternative to mechanical demolition. Two builders in the past
three years have taken advantage of the credit. Recently, the definition of demolition was
amended to include major remodels where more than 50% of a dwelling's exterior walls or
foundation are removed (Ordinance 2894). This change has the potential to increase the
number of demolition permits.
At the City Council's October 18, 2022 study session, the Council provided the following
direction for staff to prepare an ordinance:
1. Remove the sunset on Ordinance 2831. (There was not a consensus for establishing a
new sunset.)
2. Replace the existing tax reduction for manual deconstruction (deconstruction) projects
with a full tax exemption, to encourage resource conservation.
3. Research the effect of requiring deconstruction for older houses (1940s or earlier), to
encourage reuse of valuable building materials that are no longer produced.
When the tax ordinance was adopted in 2019, the Council received testimony in opposition
from the Home Builders Association of Metro Portland (HBA). Staff has reached out to the HBA
and understands that they are tracking this policy and are concerned about its effects on
housing costs. The HBA recommended demolitions for development of middle housing be
exempt. They also suggested the City exempt moderate-income housing from the tax, defined
as housing that is affordable to those earning 120 percent or less of area median income, in
place of the existing criteria (80 percent or less of area median income).
During the October 18 study session, Council did not reach consensus on whether to exempt
demolitions for middle housing. Council noted that middle housing is not necessarily affordable
to people with low incomes, though it provides other public benefits compared to single-family
detached housing, including reduced carbon footprint and more efficient delivery of urban
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services such as utilities and transit. While it is unclear how much the tax might be a barrier to
middle housing development, it was noted that the cost of a tax can be spread out over more
dwelling units in a middle housing development as compared to single-family development. The
City Manager also noted that an exemption dependent upon later construction of middle
housing would add complexity to the permit process, requiring staff time for administration and
enforcement.
Council has not previously discussed changing the affordability criteria as suggested by the HBA.
If Council were interested in considering that policy change, staff recommends taking it up as
part of the City's work toward implementing House Bill 2003 (Housing Production Strategy).
Included as part of Ordinance 2916 (Attachment 1), staff is proposing an amendment to the
demolition tax that would exempt all types of housing that meet the City's established
affordability criteria, as defined in the SDC exemption (LOC 39.06.105(5)(a)(ii)). The proposed
ordinance exempts any type of housing that meets these criteria, instead of limiting the
exemption to developments of multifamily rental housing as is currently the case. The change
would make the demolition tax exemption consistent with the system development charge fee
exemption in Ordinance 2885.
The Sustainability Advisory Board (SAB) and Historic Resources Advisory Board (HRAB) reviewed
the demolition tax and provided their recommendation in Attachment 2. Among other
recommendations, SAB and HRAB suggested deconstruction of older houses (built in 1940 or
earlier) become mandatory, to reduce the environmental impact of demolitions and to
encourage reuse of valuable building materials that are no longer produced. Accordingly, and
pursuant to City Council's direction during the October 18 study session on the tax, staff
researched the number of demolitions approved for structures that were built in 1940 or
earlier. See Discussion, below.
BACKGROUND
In 2016, the City Council amended the City's local Building Code (LOC 45.12.100) to require a
14-day waiting period for all residential demolitions, with notice of the demolition mailed to
adjacent property owners and posted on the site (Ordinance 2727). The City also requires
certification and abatement of asbestos and lead-based paint as part of the demolition process.
In 2018, the City Council adopted System Development Charge (SDC) financial incentives for the
development of affordable housing and measures to encourage the retention of existing
housing. These measures included fee waivers for accessory dwelling units and affordable
housing (Ordinance 2810), and a streamlined land use permit process for ADUs (Ordinance
2784).
In 2019, the City Council adopted the residential demolition tax with a 3-year sunset provision.'
Unless the sunset is removed or modified, Ordinance 2831 expires on January 2, 2023.
1 Lake Oswego is the only Oregon local government with a demolition tax.The City of Portland considered but
abandoned a similar tax proposal in 2018.
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In 2022, the City Council amended the SDC financial incentives for affordable housing to include
more types of income-targeted housing (not limited to multifamily rental housing), including
for-sale homes (Ordinance 2885).
On October 18, 2022, the City Council held a study session on the demolition tax and provided
direction for preparing proposed Ordinance 2916.
DISCUSSION
The existing demolition tax enacted with Ordinance 2831 (Lake Oswego Code Article 24.06)
applies to demolitions of residential structures, as follows:
1. A tax of$15,000 per demolition is levied at the time of permit issuance.
2. A $5,000 tax reduction or credit is provided for projects that use a City of Portland
Certified Deconstruction Contractor as an alternative to mechanical demolition.
3. Demolitions of structures that are removed for development of affordable housing, or
where the City declares the structure unsafe/condemns it, are exempt from the tax.
4. The tax revenue is dedicated to parks maintenance. It is general tax, not an SDC or a
construction excise tax.
When the existing tax was approved in late 2019, revenue was projected based on permitting
activity over the previous five years, which had averaged approximately 30 demolitions per
year. This assumed the economy remained strong. By setting the rate at $15,000, the tax was to
meet the Parks Department's annual goal of$400,000 in revenue, or approximately 10%-15% of
the Department's maintenance budget2. To date, the tax has exceeded this goal, as follows:
Table 1. 2019-2022 Demolition & Revenue By Demo Type, as of September 2022
Demolition Permits Demolition Permit Deconstruction- Deconstruction-
Issued Revenue Demolition Demolition Revenue
Permits Issued
2019 37 $0 0
2020 16 $240,000 0
2021 36 $540,000 2 $20,000 _
2022 29 $405,000 0 _
2022(applied but not 9 0
issued)
Total issued 118 $ 1,185,000 2 $20,000
Total issued+applied 127
2 According to the Parks and Recreation Department,the total Parks, Natural Areas and Athletic Fields
Maintenance budget is$3.6M annually;the demolition tax equals 13.9%of the budget.
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Deconstruction Incentive
The City Council adopted the deconstruction tax incentive because of the environmental
benefits of reusing building materials instead of disposing of them in the landfill or recycling,
consistent with the City's sustainability goals. When the City was first considering the
demolition tax and deconstruction incentive, staff had researched Portland's deconstruction
program, which at the time provided a good model for the proposed incentive3, even though
Portland requires deconstruction for older houses. In 2016, Portland was the first city in the
country to require deconstruction, as opposed to mechanical demolition. At first, they required
deconstruction for removal of any designated historic landmark and homes built in 1916 or
earlier, but in 2019, Portland amended its policy and changed the cutoff date to 1940 or earlier.
Staff asked SAB and HRAB to make recommendations for City Council consideration, which are
provided in Attachment 2. The advisory boards jointly recommend making deconstruction
mandatory for older houses undergoing demolition. Staff researched Portland's program in July
2022. At that time, Sustainability Manager Amanda Watson contacted program manager Shawn
Wood who reported that certified deconstruction contractors have additional capacity to take
on more projects. Mr. Wood also indicated the market for salvaged materials was good. Staff
can confirm that with deconstruction contractors and salvage companies.
Based on Council's direction at the October 18 study session on the tax, staff researched the
number of demolition applications for structures that were built in 1940 or earlier using
Metro's Regional Land Information System and the City's GIS. Although the data are
incomplete, we were able to identify "year built" for 90 out of 91 demolition permits applied
for during 2020 through September 2022. A total of 30 out of 90 of those houses were built in
or before 1940. Previously, it was reported there were no deconstruction projects that utilized
the deconstruction incentive; in fact, there were two, both in 2021. One house was originally
built in 1960, and the other in 1935. See Attachment 3.
IMPACTS AND ALTERNATIVES
The demolition tax adds to the cost of housing production and disproportionately impacts
lower-value properties because the tax is a flat amount (not tied to the value of the demolished
structure). The tax also targets neighborhoods that are redeveloping rather than the city as a
whole, which some residents may view as unfair because the tax is used for parks maintenance
citywide.
Alternatives to removing the sunset on the demolition tax include allocating additional general
funds to Parks, adopting a park utility fee, or asking voters to approve a tax levy to help pay for
maintenance of new parkland that may be acquired and facilities constructed under the 2019
Parks and Open Spaces Bond.
3 The stated purpose of Portland's deconstruction ordinance is to"maximize salvage of building materials for
reuse, reduce carbon emissions and landfill waste,and to minimize the adverse impacts associated with building
removal."
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FISCAL IMPACT
Removing the sunset on the residential demolition tax would have a positive impact on revenue
for parks maintenance. Currently, the tax raises approximately $400,000 per year. By
exempting houses built in 1940 or earlier, Council should plan for a reduction in tax revenue by
as much as 30%; though the effect of the exemption may decrease over time as fewer older
houses are demolished.
RECOMMENDATION
Conduct a public hearing and adopt Ordinance 2916.
ATTACHMENTS
1. Ordinance 2916, with Exhibit A
2. SAB and HRAB Joint Recommendation, August 31, 2022
3. Demolition Data by Year Built for Demolitions Approved 2019-2022 (September)
4. Article 24.06 and 45.12 code amendments, with full section text for context
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ATTACHMENT 1
ORDINANCE 2916
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LAKE OSWEGO REMOVING THE SUNSET
ON ORDINANCE 2831 (LOC 24.06 RESIDENTIAL DEMOLITION TAX), MODIFYING THE AFFORDABLE
HOUSING AND DECONSTRUCTION INCENTIVES IN LOC ARTICLE 24.06, AND AMENDING LOC
ARTICLE 45.12 (DEMOLISHING OR MOVING BUILDINGS) TO MAKE DECONSTRUCTION
MANDATORY FOR STRUCTURES BUILT IN THE YEAR 1940 OR EARLIER.
WHEREAS, the City of Lake Oswego demolition tax, as established by Ordinance 2831 and codified
in Lake Oswego Code Article 24.06, provides needed revenue for maintaining City park properties
and facilities; and
WHEREAS, manual deconstruction can be a more sustainable method of demolition than
mechanical demolition by providing opportunities for reuse of valuable building materials, as
opposed to recycling or landfill disposal;
WHEREAS, the demolition tax reduction for manual deconstruction performed by a certified
deconstruction contractor (LOC 24.06.050), could be more effective at encouraging deconstruction
as an alternative to mechanical demolition;
WHEREAS, it is in the public interest to require deconstruction by a certified deconstruction
contractor where the demolition permit is issued for removal of a residential structure originally
built in or prior to 1940, to encourage reuse of valuable building materials;
WHEREAS, it is in the public interest to exempt from the demolition tax any demolition that is for
the purpose of developing housing that meets the City's adopted affordable housing criteria; and
WHEREAS,the demolition tax is for revenue purposes and is not a fee for recovering administrative
costs, nor is it regulatory in any manner;
The City of Lake Oswego ordains as follows:
Section 1. Sunset Provision. Section 3, the Sunset Provision, of Ordinance 2831 is hereby repealed.
Section 2. The Lake Oswego Code, Article 24.06 (Demolition Tax) and Lake Oswego Code, Article
45.12 (Demolishing or Moving of Buildings), are hereby amended by adding new text shown in
double underlined type and by deleting text shown with strikeouts, in Exhibit A. (Sections or
subsections within LOC Article 24.06 and LOC Article 45.12 that are omitted in Exhibit A, and not
marked for deletion or addition, are neither amended nor deleted by this Ordinance.)
Ordinance 2916
Page 1of2
Section 3. Effective Date. As provided under Section 35.C. of the Lake Oswego Charter, this
ordinance shall take effect on the 30th day following enactment.
Section 4. Severability. The provisions of this ordinance are severable. If any portion of this
ordinance is for any reason held to be invalid, such decision shall not affect the validity of the
remaining portions of this ordinance.
Enacted at the regular meeting of the City Council of the City of Lake Oswego held on the 15th day
of November 2022.
AYES:
NOES:
ABSTAIN:
EXCUSED:
Joseph M. Buck, Mayor
ATTEST:
Kari Linder, City Recorder
APPROVED AS TO FORM:
Evan Boone, City Attorney Pro Tem
Ordinance 2916
Page 2 of 2
Exhibit A —Ord. 2916
24.06.010 Purpose.
The demolition of residential structures in the City of Lake Oswego has contributed to the waste stream
through disposal of building materials. Demolition has also reduced the diversity of housing stock
and decreased the availability of affordable housing within the City. Subsequent redevelopment has
contributed to increases in housing prices that make it more difficult to provide affordable housing. The
permit fees relating to building demolitions cover the administrative costs of the regulatory program, but
do not address other impacts of demolition of residential structures. The tax imposed under this article is
not for the purpose of recovering administrative costs and is not regulatory in any manner. The tax is
strictly for revenue purposes, to provide funding to maintain City park properties and facilities. The tax
shall be in addition to any regulatory demolition permit fees established from time to time by the City
Council and all other applicable regulatory fees and charges.
24.06.040 Exemptions.
***
2. The demolition tax imposed in LOC 24.06.030 shall not apply to:
a. Any residential structure being demolished due to a catastrophic loss such as fire, landslide,
flood, earthquake or other disaster;
b. Any residential structure that is subject to a vacation or demolition order by the City Building
Official by reason of being an unsafe building or structure under LOC 45.09.060, or a dangerous
building under LOC 45.09.065;
c. Any residential structure located on publicly owned property; Of
d. Any residential structure being demolished to clear a site for development of multi family
affordable housing described in LOC 39.06.105(5)(a)(ii); provided, that:
i. The owner of the property including the residential structure has received a development
permit for development on the property that qualifies for the system development charge
exemption under LOC 39.06.105(5);
ii. The covenant required by LOC 39.06.105(5) based upon the approved development is
recorded; and
iii. All of the terms of the covenant are complied with.
e. Any residential structure where the demolition permit is issued for removal of a
residential structure through deconstruction by a certified deconstruction contractor under
LOC 24.06.050.
Page 1 of 3
Exhibit A —Ord. 2916
3. Any demolition tax paid under LOC 24.06.030 shall be refunded to the property owner if, within one
year following issuance of the demolition permit:
a. The property owner obtains a building permit for development of multi family affordable
housing described in LOC 39.06.105(5)(a)(ii) on the property from which the residential structure
was removed;
b. The development has qualified for the system development charge exemption under
LOC 39.06.105(5); and
c. The covenant required by LOC 39.06.105(5) is recorded.
24.06.050 Tax Reduction Exemption for Deconstruction of Residential Structures.
1. The demolition tax imposed in LOC 24.06.030 shall be waived reduced by$5,000 where the
demolition permit is issued for removal of a residential structure through deconstruction by a certified
deconstruction contractor.
2. To be eligible for the demolition tax exemption for deconstruction reduction, a pre-deconstruction
form, in a form approved by the City Manager, must be completed and submitted as part of the
application for the demolition permit. The form must be completed by the certified deconstruction
contractor assigned to the project. Information required on the form must include, but is not limited to:
3. ***
24.06.070 Failure to Comply with Requirements of Exemption for Affordable Housing or
Exemption Reduction—for Deconstruction.
1. This section shall apply when:
a. An exemption from the demolition tax has been granted under LOC 24.06.040(2)(d), or a
demolition tax has been refunded under LOC 24.06.040(3), but the covenant is violated, or is
terminated according to its terms before the expiration date; or
b. An exemption from reduction of the demolition tax has been granted under LOC 24.06.050,
but the residential structure is not removed through deconstruction that complies with all
requirements of that section and all applicable rules and procedures adopted by the City Manager.
***
3. The exemption, reduction or refund will be terminated and the entire exempted, reduced or refunded
amount of the demolition tax, plus the processing fee, together with interest from the date the exemption,
refund, or permit with tax reduction was granted at a rate established by the City Council, shall become
immediately due and payable by the current owner of the property.
***
Page 2 of 3
Exhibit A —Ord. 2916
Article 45.12
Demolishing or Moving Buildings.
//
45.12.100 Demolition of Dwellings.
1. Definitions.
a. "Building Official" means the person appointed by the City Manager to enforce the provisions of
the Building Code, or designee.
b. "Certified Deconstruction Contractor" means as defined in LOC 24.06.020.
c. "Deconstruction" means as defined in LOC 24.06.020.
d . "Demolition" or"demolish" means removal of 50% or more of the total surface area of exterior
walls or perimeter foundation of a residential structure as it existed on June 2, 2022, either as a
single project or cumulatively over five years or less.
ec. "Exterior wall"for the purpose of this section means a wall enclosing a dwelling that has a
surface exposed to the outside, including all framing and sheathing, from top plate to bottom plate
on all stories.
***
45.12.110 Deconstruction of Dwellings Required.
Demolition of residential structures built in the year 1940 or earlier shall be by deconstruction
only and follow the procedures for deconstruction under LOC 24.06.050, LOC 24.06.070 and LOC
24.06.080,.
***
Page 3 of 3
ATTACHMENT 2
E�.r MEMORANDUM
TO: Members of the City Council
FROM: Historic Resources Advisory Board
Sustainability Advisory Board
SUBJECT: Demolition Tax Renewal
DATE: August 31, 2022
On August 10, 2022, members of the Historic Resources Advisory Board and Sustainability
Advisory Board met jointly to discuss the renewal of the City of Lake Oswego's Demolition Tax
and corresponding deconstruction incentive. City staff solicited Board members' input on
potential updates that might be needed to the tax, including changes that would encourage
more demolition projects to use deconstruction.
Incentivizing deconstruction aligns with the City's sustainability and climate action goals
because deconstruction enables the reuse of building materials that would otherwise be placed
in landfills and reduce the overall carbon footprint of new construction. The Sustainability
Advisory Board and HRAB members have encouraged City staff to evaluate policy options to
require deconstruction of older homes, following City of Portland's model.
The group also discussed whether the City should consider additional incentives connected to
the demolition tax that would allow volunteers permission from the property owner to access
older properties to document older homes and add to the existing database before they are
demolished. In response to the increasing number of older homes being demolished
throughout the City, the Historic Resources Advisory Board worked with Planning, Building, and
Library staff to develop an administrative procedure for documenting homes built more than 45
years ago. Documenting these older homes can contribute to the City's architectural history.
In light of the City's sustainability and historic preservation goals, we recommend that Council
consider the following actions in relation to the Demolition Tax:
• Follow Portland's model to require deconstruction of any homes built prior to 1940.
• Raise the demolition tax to $25,000 and allocate some of the revenue to the Historic
Preservation Grant Program.
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• Raise the incentive for a deconstruction permit from $5,000 to $10,000. Information on
the differences in cost between demolition and deconstruction could be used to
determine the appropriate amount of the incentive relative to the tax.
• Direct staff to investigate why the deconstruction incentive has not been utilized, and
what strategies could help overcome barriers that might exist. For example:
a. If the permit process is a barrier, streamline the permit application process for
deconstruction permits. Possibly, create an expedited process for deconstruction
permit applications.
b. If the incentive is not being used because residents are not aware of it, educate
the public and discuss the deconstruction option in greater detail when
homeowners apply for a permit. Perhaps develop a brochure that describes the
process. Conduct additional education outreach to contractors, deconstruction
contractors and property owners with homes that are 40 years old or older.
• Integrate more sustainable construction incentives to support Sustainability and Climate
Action Plan goals. Allow for more demolition permit cost reduction (or other incentives,
potentially funded by demolition tax revenue) if the property owner integrates more
sustainable practices at the building phase that lower the carbon footprint of buildings.
• Extend waiting period for demolition permits issued for homes that are greater than 40
years old from 14 days to 30 days. This would allow more time for city volunteers to
document the property and provide more opportunities to consider deconstruction.
Thank you for your consideration.
Respectfully,
Members of the Historic Resources Advisory Board and Sustainability Advisory Board
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ATTACHMENT 3
DEMOLITION APPLICATIONS (2020-2022 SEPT) BY YEAR BUILT page 1 of 2
NUMBER STREET TYPE City PARCEL YEARBUIL_2019
1455•CHANDLER RD LAKE OSWEGO '21E03CCO2500 0
540.E AVE LAKE OSWEGO '21E03DC06600 1900
769'4TH ST LAKE OSWEGO '21E03DA06100 1910
718'5TH ST LAKE OSWEGO '21E03DB08000 1910
523LAUREL ST LAKE OSWEGO '21E10DA04100 1915
53'D AVE LAKE OSWEGO '21E03DA02200 1920
330'6TH ST LAKE OSWEGO '21E03DC13200 1920
3525•LAKE GROVE AVE LAKE OSWEGO '21E08CA00100 1922
15655•TWIN FIR RD LAKE OSWEGO '21E08ACO2700 1924
718'3RD ST LAKE OSWEGO '21E03DA05000 1925
16140'REESE RD LAKE OSWEGO '21E08CA04200 1928
743'6TH ST LAKE OSWEGO '21E03DB07600 1928
4330•LAKEVIEW BLVD LAKE OSWEGO '21E08CC05300 1933
2945•UPPER DR LAKE OSWEGO '21E08AD00700 1934
1625'CLOVERLEAF RD LAKE OSWEGO '21E16BD01800 1935
608•CABANA LN LAKE OSWEGO '21E10AB09500 1935
*604 CABANA LN LAKE OSWEGO '21E10AB09300 1935
13741KNAUS RD LAKE OSWEGO '21E04BD01300 1936
16720•ALDER CIR LAKE OSWEGO '21E17AB04700 1937
13962•KNAUS RD LAKE OSWEGO '21E04DB00900 1938
13561:GOODALL RD LAKE OSWEGO '21E04BC00900 1938
1037•LAKE FRONT RD LAKE OSWEGO '21E10DB02000 1939
17437•CANAL CIR LAKE OSWEGO '21E17BA06900 1939
920•EVERGREEN RD LAKE OSWEGO '21E03CD09800 1939
527'NORTH SHORE RD LAKE OSWEGO '21E10AC00600 1939
534'D AVE LAKE OSWEGO '21E03DB13400 1940
853E AVE LAKE OSWEGO '21E03BD07100 1940
937'9TH ST LAKE OSWEGO '21E03BD06300 1940
1334•MAPLE ST LAKE OSWEGO '21E10CA09400 1940
1425•MAPLE ST LAKE OSWEGO '21E10CA04000 1940
13800 GOODALL RD LAKE OSWEGO '21E04BD01800 1940
755 ELLIS AVE LAKE OSWEGO '21E03CD10900 1946
17561 LAKE HAVEN DR LAKE OSWEGO '21E17BCO2500 1947
2305 GLEN HAVEN RD LAKE OSWEGO '21E16BB02500 1947
4257 LORDS LN LAKE OSWEGO 21E17BCO2400 1947
2301:HAZEL RD LAKE OSWEGO '21E04BC01500 1947
825'ELLIS AVE LAKE OSWEGO '21E03CD10700 1948
1012•LAKE FRONT RD LAKE OSWEGO '21E10DB02500 1948
1111:BAYBERRY RD LAKE OSWEGO '21E03CA04000 1948
370'9TH ST LAKE OSWEGO '21E03CD07600 1948
17495'KELOK RD LAKE OSWEGO '21E17BD08700 1949
2275•GLEN HAVEN RD LAKE OSWEGO '21E16BB02400 1949
807'ELLIS AVE LAKE OSWEGO '21E03CD10800 1950
732'ELLIS AVE LAKE OSWEGO '21E10BA00600 1950
18024'EASTRIDGE LN LAKE OSWEGO '21E14CB02200 1950
1107•YATES ST LAKE OSWEGO '21E10DD01300 1950
230LAUREL ST LAKE OSWEGO '21E10DA07200 1952
16885•FERNWOOD DR LAKE OSWEGO '21E16BB04500 1952
2320•GLEN HAVEN RD LAKE OSWEGO '21E16BB03900 1952
915.OAK TER LAKE OSWEGO '21E09DA02200 1953
15780•TWIN FIR RD LAKE OSWEGO '21E08AC05300 1954
2485'GREENTREE RD LAKE OSWEGO '21E16BB05500 1954
2679•GLEN EAGLES RD LAKE OSWEGO '21E08AA03500 1954
2101'WEMBLEY PARK RD LAKE OSWEGO '21E04CCO2800 1955
2245•GLEN HAVEN RD LAKE OSWEGO '21E16BB02200 1955
16873•CANYON DR LAKE OSWEGO '21E17AA06800 1955
1132•TROON RD LAKE OSWEGO '21E10BB03300 1955
1250 SUNNINGDALE RD LAKE OSWEGO 21E03CB00100 1956
DEMOLITION APPLICATIONS (2020-2022 SEPT) BY YEAR BUILT - page 2 of 2
628 5TH ST LAKE OSWEGO 21E03DB12600 1956
17337'WESTVIEW DR LAKE OSWEGO '21E17AC03200 1956
2740•GLEN HAVEN RD LAKE OSWEGO '21E17AA05800 1957
2090•CREST DR LAKE OSWEGO '21E04CC06600 1958
13041 THOMA RD LAKE OSWEGO '21E04BB02600 1958
259•PINE VALLEY RD LAKE OSWEGO '21E10BB01100 1959
517LAUREL ST LAKE OSWEGO '21E10DA04300 1959
17104•CANAL CIR LAKE OSWEGO '21E17BA04400 1959
*726 •MCVEY AVE LAKE OSWEGO '21E10DB00700 1960
17950'KELOK RD LAKE OSWEGO '21E17CA00300 1961
19175•PILKINGTON RD LAKE OSWEGO '21E19BA02900 1962
3610'EENA RD LAKE OSWEGO '21E17AB07000 1964
18707'BRYANT RD LAKE OSWEGO '21E17CC01301 1964
668'MCVEY AVE LAKE OSWEGO '21E10AD99020 1964
1108'SPRUCE ST LAKE OSWEGO '21E10DC08900 1965
15530•DIAMOND HEAD RD LAKE OSWEGO '21E09AC01000 1965
4680•UPPER DR '21E07DD05200 1966
17663'HILL WAY LAKE OSWEGO '21E18AD07200 1966
4595•WILDWOOD ST LAKE OSWEGO '21E18AD00400 1967
4241:C0BB WAY LAKE OSWEGO '21E17BB11500 1969
17952•CARDINAL DR LAKE OSWEGO '21E17CA01200 1969
18975.OLSON CT LAKE OSWEGO '21E20BA00800 1970
4200•OLD GATE RD LAKE OSWEGO '21E20BB02204 1972
4141:C0BB WAY LAKE OSWEGO 21E17BB12000 1972
18015•CARDINAL DR LAKE OSWEGO '21E17CA03400 1972
17570'HILL WAY LAKE OSWEGO '21E18AD08600 1976
63•AQUINAS LAKE OSWEGO '21E06AA00106 1976
820•TIMBERLINE DR LAKE OSWEGO '21E04AA03404 1976
3331:FIR RIDGE RD LAKE OSWEGO '21E08AB00800 1977
2111:SUMMIT DR LAKE OSWEGO '21E09BCO2400 1977
2442•PALISADES CREST DR LAKE OSWEGO '21E17DA02826 1980
13041:KNAUS RD LAKE OSWEGO '21E04BB00700 1984
1445.OAK TER LAKE OSWEGO '21E09CA00305 1984
4357•SOUTH SHORE BLVD LAKE OSWEGO '21E08CC09200 1986
15012•TWIN FIR RD LAKE OSWEGO '21E08AB03202 1989
3759•LANEWOOD ST LAKE OSWEGO '21E08BD02602 1993
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ATTACHMENT 4
Article 24.06
Demolition Tax
Sections:
24.06.010 Purpose.
24.06.020 Definitions.
24.06.030 Demolition Tax Imposed; Use of Revenue.
24.06.040 Exemptions.
24.06.050 Tax Exemption Reduction for Deconstruction of Residential Structures.
24.06.060 Authority of City Manager.
24.06.070 Failure to Comply with Requirements of Exemption for Affordable Housing
or Reduction Exemption for Deconstruction.
24.06.080 Violations.
Editor's Note: Section 3 of Ordinance 2831 provides, "The provisions of this ordinance shall be null,
be repealed, on and after January 2, 2023."
24.06.010 Purpose.
The demolition of residential structures in the City of Lake Oswego has contributed to the waste stream
through disposal of building materials. Demolition has also reduced the diversity of housing stock
and decreased the availability of affordable housing within the City. Subsequent redevelopment has
contributed to increases in housing prices that make it more difficult to provide affordable housing. The
permit fees relating to building demolitions cover the administrative costs of the regulatory program, but
do not address other impacts of demolition of residential structures. The tax imposed under this article is
not for the purpose of recovering administrative costs and is not regulatory in any manner. The tax is
strictly for revenue purposes, to provide funding to maintain City park properties and facilities. The tax
shall be in addition to any regulatory demolition permit fees established from time to time by the City
Council and all other applicable regulatory fees and charges.
24.06.020 Definitions.
As used in this article, unless the context requires otherwise:
Certified Deconstruction Contractor means a contractor licensed with the Oregon Construction
Contractors Board (CCB)that has successfully completed the deconstruction training and certification
program offered by the Building Material Reuse Association, or other program recognized by the City
Manager, and that has been approved as a credentialed Certified Deconstruction Contractor by the
Director of the City of Portland Bureau of Planning and Sustainability, or the Director's designee. A firm
will be considered certified if at least one person currently employed by the firm is certified.
City Manager means the person holding the position of City Manager of the City of Lake Oswego, or that
person's designee.
Attachment 4
Page 1 of 8
Deconstruction means the systematic dismantling of a structure, typically in the opposite order from which
it was constructed, in order to maximize the salvage of materials for reuse, in preference over salvaging
materials for recycling, energy recovery or disposal in a landfill.
Demolition or Demolish means as defined in LOC 45.12.100(1)(b).
Demolition Permit means the permit required under LOC 45.02.200.
Residential Structure means a single-family dwelling or a duplex, as defined in LOC 50.10.003.2.
Reuse means the utilization of a product or material that was previously installed for the same or similar
function to extend its life cycle. Materials salvageable for reuse include but are not limited to cabinets,
doors, hardware, fixtures, flooring, siding, and framing lumber.
(Ord. 2831, Added, 12/03/2019)
24.06.030 Demolition Tax Imposed; Use of Revenue.
1. On or after January 2, 2020, the owner of property that includes a residential structure for which a
demolition permit is issued shall pay a tax to the City in the sum of$15,000. The tax shall be paid at the
time the demolition permit is issued.
2. Revenue received from the tax imposed in subsection (1) of this section shall be used solely to
maintain City park properties and facilities, including, without limitation, repair, renovation and
replacement of existing improvements.
24.06.040 Exemptions.
1. The demolition tax imposed in LOC 24.06.030 shall not apply if:
a. A complete and unexpired application for a demolition permit for the residential structure was
on file with the City before January 2, 2020;
b. A complete and unexpired application for a development permit under LOC Chapter 50 was on
file with the City before January 2, 2020, for development that, as proposed in the application,
necessitates demolition of the residential structure; or
c. An unexpired development permit under LOC Chapter 50 issued before January 2, 2020, for
the property containing the residential structure approves development that necessitates demolition
of the residential structure, or includes a condition of approval that requires demolition of the
residential structure.
2. The demolition tax imposed in LOC 24.06.030 shall not apply to:
a. Any residential structure being demolished due to a catastrophic loss such as fire, landslide,
flood, earthquake or other disaster;
Attachment 4
Page 2 of 8
b. Any residential structure that is subject to a vacation or demolition order by the City Building
Official by reason of being an unsafe building or structure under LOC 45.09.060, or a dangerous
building under LOC 45.09.065;
c. Any residential structure located on publicly owned property; or
d. Any residential structure being demolished to clear a site for development of multi family
affordable housing described in LOC 39.06.105(5)(a)(ii); provided, that:
i. The owner of the property including the residential structure has received a development
permit for development on the property that qualifies for the system development charge
exemption under LOC 39.06.105(5);
ii. The covenant required by LOC 39.06.105(5) based upon the approved development is
recorded; and
iii. All of the terms of the covenant are complied with.
e. Any residential structure where the demolition permit is issued for removal of a
residential structure through deconstruction by a certified deconstruction contractor under
LOC 24.06.050,
3. Any demolition tax paid under LOC 24.06.030 shall be refunded to the property owner if, within one
year following issuance of the demolition permit:
a. The property owner obtains a building permit for development of multi family affordable
housing described in LOC 39.06.105(5)(a)(ii) on the property from which the residential structure
was removed;
b. The development has qualified for the system development charge exemption under
LOC 39.06.105(5); and
c. The covenant required by LOC 39.06.105(5) is recorded.
24.06.050 TaxReel-Li-GU-en Exemption for Deconstruction of Residential Structures.
1. The demolition tax imposed in LOC 24.06.030 shall be waived reduced by$5,000 where the
demolition permit is issued for removal of a residential structure through deconstruction by a certified
deconstruction contractor.
2. To be eligible for the demolition tax exemption for deconstruction reduction, a pre-deconstruction
form, in a form approved by the City Manager, must be completed and submitted as part of the
Attachment 4
Page 3 of 8
application for the demolition permit. The form must be completed by the certified deconstruction
contractor assigned to the project. Information required on the form must include, but is not limited to:
a. Name of the certified deconstruction contractor;
b. Whether heavy machinery will be used on the deconstruction project (exclusive of foundation
removal);
c. List of materials that are intended to be salvaged for reuse;
d. List of materials that are not salvageable and the reason why the materials cannot be
salvaged; and
e. Expected dates for deconstruction activity.
3. A post-deconstruction form, in a form approved by the City Manager, must be completed by the
certified deconstruction contractor assigned to the project and submitted to the City Manager no more
than 30 days after completion of the deconstruction work. The City Manager must review and approve the
post-deconstruction form before the demolition permit can be finaled. The form must include responses to
all of the following in order to be considered complete:
a. Name of the certified deconstruction contractor.
b. List of materials salvaged for reuse.
c. List of materials not salvaged for reuse, as indicated on the pre-deconstruction form, and the
reasons materials were not salvaged.
d. Copies of the following:
i. Itemized receipt of materials and quantities donated to a nonprofit.
ii. Itemized receipts for materials and quantities sold.
iii. Photos of salvaged material that will be reused on site or at another site.
iv. Transaction receipts of weight tickets for the disposal of hazardous material abated
during the course of deconstruction.
v. List and photos of materials given or sold to members of the public.
24.06.060 Authority of City Manager.
The City Manager is authorized to adopt rules, procedures, and forms to implement the provisions of this
article.
Attachment 4
Page 4 of 8
24.06.070 Failure to Comply with Requirements of Exemption for Affordable Housing or
Exemption Reduction-for Deconstruction.
1. This section shall apply when:
a. An exemption from the demolition tax has been granted under LOC 24.06.040(2)(d), or a
demolition tax has been refunded under LOC 24.06.040(3), but the covenant is violated, or is
terminated according to its terms before the expiration date; or
b. An exemption from reduction of the demolition tax has been granted under LOC 24.06.050,
but the residential structure is not removed through deconstruction that complies with all
requirements of that section and all applicable rules and procedures adopted by the City Manager.
2. The current owner of the property on which the residential structure was located shall pay the City a
processing fee in an amount established by resolution of the City Council.
3. The exemption, reduction or refund will be terminated and the entire exempted, reduced or refunded
amount of the demolition tax, plus the processing fee, together with interest from the date the exemption,
refund, or permit with tax reduction was granted at a rate established by the City Council, shall become
immediately due and payable by the current owner of the property.
4. The City Manager shall furnish a notice of the noncompliance under subsection (1)(a) or(1)(b) of this
section, together with a statement of the charges and fees under this section and a description of the
objection and hearing process, to the current owner of the property in person or by certified mail, return
receipt requested, addressed to the current owner at the last known address as shown in the county
property tax assessment records. If no objection is filed with the City Recorder within 15 days of the date
the notice is mailed, the reinstated demolition tax amount, processing fee, and interest shall be a lien
against the property.
5. If the current owner files an objection within the 15-day period, the City Council shall hold a public
hearing, upon notice sent to the current owner by first class mail not less than 15 days in advance, to
consider the oral and written testimony and materials provided by the City Manager, the current owner, or
other interested persons. Following the hearing, the City Council shall determine whether the events
described in subsection (1)(a)or(1)(b)of this section have occurred and, if so, the amounts that are due
and payable under this section. The amounts determined by the City Council shall be a lien against the
property on which the residential structure was located. The City Council's decision shall be final.
6. The City Manager shall docket the lien in the City lien docket. The lien shall be enforceable in the
manner provided in ORS Chapter 223.
Attachment 4
Page 5 of 8
24.06.080 Violations.
1. Violation of any provision of this article shall constitute a civil violation that shall be processed
according to the procedures established in LOC Article 34.04. Each violation of a separate provision of
this article shall constitute a separate offense and each day that a violation is committed or permitted to
continue shall constitute a separate offense. Without waiving the generality of the foregoing, it shall be a
violation for any person to:
a. Fail or refuse to pay the tax established in this article;
b. Provide any false or fraudulent information, or fail to provide any required information or
documentation, with relation to the tax imposed or the exemptions, reductions or refunds allowed
under this article;
c. Demolish a residential structure other than by the required deconstruction after being granted a
tax reduction for deconstruction under LOC 24.06.050;
d. Construct development on property on which a residential structure has been demolished other
than by the required deconstruction after a demolition tax reduction has been granted under
LOC 24.06.050, unless the entire amount of the reduction together with the processing fee and
interest, have been paid to the City under LOC 24.06.070; or
e. Fail to comply with the requirements of a covenant under LOC 24.06.040(2)(d) or(3)(c).
2. The remedies provided in this section are not exclusive and shall not prevent the City from exercising
any other remedy available under the law.
***
Attachment 4
Page 6 of 8
Article 45.12
Demolishing or Moving Buildings.
//
45.12.100 Demolition of Dwellings.
1. Definitions.
a. "Building Official" means the person appointed by the City Manager to enforce the provisions of
the Building Code, or designee.
b. "Certified Deconstruction Contractor" means as defined in LOC 24.06.020.
c. "Deconstruction" means as defined in LOC 24.06.020.
db. "Demolition" or"demolish" means removal of 50% or more of the total surface area of exterior
walls or perimeter foundation of a residential structure as it existed on June 2, 2022, either as a
single project or cumulatively over five years or less.
ec. "Exterior wall"for the purpose of this section means a wall enclosing a dwelling that has a
surface exposed to the outside, including all framing and sheathing, from top plate to bottom plate
on all stories.
2. The owner of real property upon which a dwelling exists that the owner intends to demolish shall:
a. Not less than 15 consecutive days before commencing work to demolish the dwelling,
complete a written certification that the property will be posted and abutting property owners
notified pursuant to subsection (2)(b) of this section, and submit the certification to the Building
Official;
b. Not less than 14 consecutive days before commencing work to demolish a dwelling:
i. Post a public sign displaying a notice of demolition (form of sign available from the
Building Official)on the subject property or access easement abutting the property, in a
location that is clearly visible and readable from vehicles traveling on a public street and to
persons walking by the property; and
ii. Mail a notice of demolition (form of notice available from the Building Official)to the street
address of each abutting residential property informing residents of the demolition; and
c. Maintain the posting for 14 consecutive days following the posting of the property and until the
demolition commences.
Attachment 4
Page 7 of 8
3. Notice of Demolition. The posted and mailed notices of demolition shall state that the owner intends
to commence demolition for the dwelling(s)on the property, and include the date of posting or mailing,
planned date or dates of demolition, and contact information for the owner.
4. If demolition activities cease on the property for more than 60 days, a new notice of demolition is
required pursuant to subsection (2) of this section.
45.12.110 Deconstruction of Dwellings Required,
Demolition of residential structures built in the year 1940 or earlier shall be by deconstruction
only and follow the procedures for deconstruction under LOC 24.06.050, LOC 24.06.070 and LOC
24.06.080,
***
Attachment 4
Page 8 of 8