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System Development Charges (SDC’s) are a huge topic of discussion right now as costs of building rises and Home Builders Association is at the forefront of the conversation. SDC’s are fee scheduled charges designed to support new development, helping offset the impact of development and/or redevelopment. They’re one-time fees used to pay for a portion of the costs of capital improvements that add capacity to the systems and facilities in place; such as sewer systems, roads, and parks. SDC’s are determined through the planning process where each jurisdiction enacts methodologies to review present capacity and forecasted future deficiencies. Each jurisdiction has their own unique systems in place for handling SDC’s; some allow SDC deferrals or delays, and others offer finance programs, while some do not offer any solutions. What’s the difference between the two approaches and who is leading the charge in the Portland Metro area on SDC processes? Delayed SDC’s is a simple method of pushing the payment of SDC’s to later in the permitting process. Financing programs allow developers and builders to apply for a loan that would carry a low interest rate to allow the delay of payment to a later time or to be made over a longer period of time with smaller payments (up to 10 years). Most finance programs allow the applicant to dictate how long their repayment plan will be, with no early payoff penalty. It is important to note, however, that SDC financing will also result in a lien being placed on the applicant’s project. The HBA is advocating for delayed SDC’s to the point of final inspection or certificate of occupancy within all of our jurisdictions. This simple change in trigger can save builders from being prematurely saddled with varying fees that increase their carrying costs. The City of Gresham is ahead of the curve on this initiative thanks to their collaboration with the HBA. They have found a way to offer a cost saving strategy that benefits larger developers and smaller builders alike by simply pushing the trigger for these payments to the point of final inspection. There have been no negative impacts to the jurisdiction by making this change per the City of Gresham. For more information, visit the City of Gresham SDC Program website or contact Staci McIntire at stacim@hbapdx.org.