Homelessness, housing and the city’s projected budget deficit headlined Salem Mayor Chris Hoy’s second annual State of the City address Wednesday.
Hoy also pointed to the launch of commercial passenger air service at the Salem Airport, new commercial, industrial and housing developments throughout the city, and investments in downtown such as the Cannery development, Holman Hotel,Block 50 and Rivenwood Apartments.
“I am happy to report that our local economy is robust and is gaining momentum,” he said.
Hoy, whose first term as mayor ends at the end of 2024, also touted city investments in homeless services and affordable housing.
“We have tripled the number of emergency shelter beds, and nearly 80% of all affordable housing in Salem has been added in the last five years,” he said.
Hoy warned much of the progress he cited is threatened by the city’s “unprecedented revenue shortfall.”
Homelessness in Salem
Hoy joined the City Council in 2017 when about a quarter of residents surveyed listed “responding to homelessness” as a top priority.
Over the years, that number grew and, by 2021, had doubled to 58% listing homelessness as the top issue for the council to address.
“Here’s the rub though — cities have no funding mechanism to address homelessness,” Hoy said during his address at the Salem Convention Center.
Cities provide infrastructure and public safety, whereas counties are funded to provide social services.
“But cities like Salem are the first and last line of defense, and when the problem is on Liberty Street and not Cordon Road, our residents expect action from us,” Hoy said.
Using one-time grants and COVID-19 relief funds, Salem was able to partner with various organizations such as Church at the Park and Mid-Willamette Valley Community Action Agency to create three microshelter villages, a Safe Park program and the Navigation Center to transition people out of homelessness.
“All of these programs have been launched since 2017, in response to listening to our residents’ wishes,” Hoy said.
The city’s revenue system has never been adjusted to fund these services annually, he said. Many of the programs are first on the chopping block if the city makes budget cuts.
More housing availability in Salem on the horizon
Hoy said because the core of the homelessness crisis is the cost and availability of housing, the city has worked to support more development by combining permitting departments and launching a new program with preapproved building plans for accessory dwelling units.
“We streamlined Salem’s permitting and will produce more housing, more quickly for our community,” he said.
Because of the changes, the Salem Housing Authority exceeded the placement goals for the rapid rehousing program established under Gov. Tina Kotek’s executive order and used only 68% of the budget.
The agency also negotiated with the owners of Orchard Park Apartments to preserve the affordability of a 224-unit complex.
Hoy pointed to new housing coming to all parts of Salem, including East Park with 659 single-family homes and 369 apartments, a 405-unit complex coming to the Hazelgreen Road in northeast Salem, Mahonia Crossing in south Salem with 313 affordable housing units and Titan Hill with 436 units in West Salem.
“All in all, there are thousands of apartments, single-family homes and affordable housing units coming online,” Hoy said.
‘Find additional revenue or reduce services’
Hoy circled back on his State of the City address from last year, when he highlighted the revenue struggles and budget deficit.
“I shared with you that without significant help from our county and state partners, or significant public investment, we would no longer be able to provide services to our unsheltered population,” he said. “We would not have enough firefighters to adequately respond to emergency calls, and that we would not be able to address and reduce a growing violent crime rate.”
He said the blame rested on a broken property tax system changed in the 1990s that hindered the city’s ability to collect enough property taxes to cover the general fund.
“It’s a math problem that needs a statewide fix, and until the state fixes it, we will live under a broken revenue system that doesn’t keep up with the rising costs of basic services like police officers, firefighters and librarians,” Hoy said.
That reality has not changed from a year ago. The resounding defeat of the payroll tax in the November election meant the city continues to face a budget deficit.
Hoy said the issue is clear — “find additional revenue or reduce services.”
Recommendations from a revenue task force looking for new revenue sources and budget cuts discussions are expected later this year. Meanwhile, city officials are lobbying state officials for support, a payment-in-lieu-of-taxes and a change in the property tax system, Hoy said.
“The road ahead is challenging,” Hoy said. “Its path is unknown, and our destination is not obvious, but we have faced challenges before.”
He recounted people pulling together to support health care workers and businesses during the pandemic, a construction crew working to stop a vegetation fire on Jory Hill, and first responders and neighbors fighting to save shooting victims at Bush’s Pasture Park.
“Our community responds to adversity with strength,” Hoy said. “Our community responds to challenges with perseverance. We will protect what we must. … We will emerge well on our way to becoming the vibrant and robust Salem we envision.”
For questions, comments and news tips, email reporter Whitney Woodworth at wmwoodworth@statesmanjournal.com call 503-910-6616 or follow on Twitter at @wmwoodworth.
