Adopt and implement the Moderate-Income Revolving Loan Program

​​The ordinance establishes and implements the City of Portland's Moderate Income Revolving Loan (MIRL) Program, authorized under state law, to expand the production of housing affordable to moderate-income households. It enables the City to access and deploy state-provided financing through the MIRL Program. It authorizes entry into agreements with Oregon Community Housing and Community Services (OHCS) to administer state resources. ​​The legislation is intended to address a documented housing shortage by creating new financial tools to support the development of housing for households earning between 60% to 120% of Area Median Income. It further designates Prosper Portland to administer the program, aligning local urban renewal and tax increment financing (TIF) resources with state funding to accelerate middle-income housing production and increase overall housing availability in the city. ​​The Oregon Legislature created the MIRL program under SB 1537 (2024) and recently amended the program under HB 4037 (2026). Statute requires the City to adopt an ordinance authorizing the program in order to access MIRL funds from OHCS.​

​​State statute requires the City to enter into a master agreement with OHCS to borrow and repay MIRL funds. The City will pass through State (OHCS) funds to Prosper Portland via IGA, which will pass through these funds to eligible projects in the form of grants. Repayment of the OHCS funds occurs by either 1) the County's collection of a property tax fee-in-lieu paid by the residential developer; or 2) TIF backed by the City's full faith and credit if the project is located within an existing TIF district. The Ordinance directs that no more than $20 million in TIF may be pledged as a repayment source at any given time to limit the City's risk. ​The amount of resources requested from OHCS will be established by methodology within the MIRL statute, not the City. The State will make funding decisions on a first-come, first-served basis. There is no direct financial or budgetary impact to the City.

​​​This ordinance enables the City to leverage future property taxes and future TIF resources to invest in much-needed housing now, by accessing revolving loan dollars available from the State to provide necessary gap funding. Per State statute, applicants must provide a project pro forma demonstrating that the project would not be economically feasible but for receipt of the funding. ​​Dozens of American cities, and a handful of US States have recently created state-level revolving loan funds to increase the supply of affordable housing and provide relief from the housing shortage. The Oregon Legislature created the MIRL program under SB 1537 (2024) and recently amended the program under HB 4037 (2026). The legislature received public input from effected industry and advocacy organizations. ​Portland's current market rate rents are significantly less than 120% AMI, and construction of new higher-density multi-family housing is largely not financially feasible at these rents. MIRL provides an opportunity to lock-in middle-income affordability as market rents increase over time. With only $50 million in total resources available statewide, investment in Portland is anticipated to be limited to a small number of projects at current funding levels and economic conditions. ​Projects must be either: 1) located within a TIF district with the loan to be repaid via TIF resources; or 2) located outside a TIF district, must choose either Inclusionary Housing tax exemption or MIRL, but not both. Eligible projects must construct a minimum of 75 units of housing affordable to tenants earning less than 120% AMI; and be located within 0.5 miles of light rail, streetcar, or bus rapid transit.

​​In recent years, the City of Portland has identified a significant and growing need for additional housing, particularly for moderate-income households who do not qualify for traditional affordable housing programs but remain priced out of the market. Through the City's Housing Needs Analysis and Housing Production Strategy, the City Council established a goal of supporting the development of new housing units and identified the need for additional financing tools to incentivize middle-income housing production. ​​The legislation directly supports the City's broader housing goals by creating new financing mechanisms to facilitate the development of middle-income housing and increase overall housing availability across Portland.