Three years ago, in the throes of the Great Recession, the local builders had the bright idea of asking the city to let them defer paying Systems Development Charges - the fees charged on new construction to help cover the cost of new roads, sewer lines, water mains and other stuff made necessary by growth. Instead of paying SDCs before starting construction, the builders wanted to wait until they applied for an occupancy permit or nine months after they submitted their initial paperwork, whichever came first. Supposedly this was going to kick-start the city's stalled construction industry.
When the builders ask the Bend City Council to bend over, the council's usual response is "How far?" So, predictably, the SDC deferral plan was adopted.
A year later the builders were back in front of the council with their tin cup again, asking for a one-year extension of the SDC deferrals. They got it.
A year after that they asked for another extension. They got that too.
Now, in an annual August ritual that's getting to be as predictable as smoke-filled skies and back-to-school sales, the builders are asking the council to continue the deferral for yet another year. Anybody want to give odds on what the council's response will be?
We didn't like the SDC deferral in 2008, we didn't like it in 2009, we didn't like it in 2010, and we don't like it any better now. Our reasons for not liking it have been stated before: It costs the city money that it can ill afford, it amounts to favoritism toward a particular industry, and - most importantly - it flat-out doesn't work.
It can hardly be claimed that the SDC deferral program has ignited a building boom. In the three years of its existence only about 35 builders have applied for it, according to city officials. About $800,000 worth of deferrals have been issued, and there's still $370,000 outstanding on them.
The deferrals granted so far have involved only about 70 projects, mostly houses. There's no way of knowing for sure, but we suspect most if not all of those projects would have gone forward anyway.
Builders build houses, and other things, because they believe they can sell them. The Bend construction industry, and the Bend economy, will revive when people have enough money to start buying houses again. Giving handouts to the builders is not going to make that happen.
The Bulletin's editorial page, which is virtually a house organ of the local builder-developer-realtor bloc, claimed in a recent editorial that "the SDC deferral program works." True, it works for the builders who apply for it and get what amounts to a nice little interest-free loan from the taxpayers. But it doesn't work for Bend.
The council should give it THE BOOT. However, as we noted above, it almost certainly won't. So we will. Again.