Kafoury's resolve should make for fireworks as hundreds of renters, housing advocates and landlords are expected to pack a city council hearing this week. The entire city council supports the dramatic new housing policy crafted by Kafoury, who retires in January. In that case, the federal Housing and Urban Development Department reduced its generous rent subsidies to the building's owners, who then decided to convert the Roosevelt into a hotel and evicted 56 low-income tenants. As the tenants scrambled to find new housing, Kafoury discovered that at least another 2,197 tenants in Portland faced similar fates because of declining HUD subsidies. This allows the city first dibs to buy the property at fair market value.
Landlords loathe the policy for two reasons.
First, they don't like the fact that they have to pay to replace lost affordable housing. The second problem for landlords is the 60-year affordability requirement for housing built in the future with city subsidies. Landlords say this unfairly deprives them of profits and will cause private investors to get out of the affordable-housing business. Sten notes that many projects now come with 55-year federal affordability requirements. Because competition for those federal subsidies is fierce, Sten doesn't believe Kafoury's plan will deter private investment.