by Robin Linares, Oregon Capital Chronicle
March 25, 2026
City officials and developers are eying a 120-acre former farming property just outside of Woodburn city limits for a housing complex to meet the needs of the small Marion County city’s growing population.
However, the city ran into a problem. The land is outside the urban growth boundary, or the invisible state-approved line around cities that determines where and how they can grow. While a 2024 state law intended to allow severely rent-burdened cities like Woodburn to have a one-time boundary expansion for affordable housing development, Woodburn could not meet certain standards to use the opportunity outlined in the bill, despite its housing need.
This session, two bills passed that allowed for more cities to use the one-time boundary expansion process outlined in the 2024 law. Gov. Tina Kotek requested House Bill 4082, which expanded this process to allow for the development of manufactured homes for older adults. The other, House Bill 4035, fixed and added to criteria in SB 1537, including an amendment to further expedite the process for Woodburn.
“(HB 4035) does not waive any local or state land-use requirements; instead, it consolidates would normally be multiple, sequential review steps into a single coordinated process,” Woodburn city officials wrote in a statement to the Capital Chronicle. “For a community that continues to meet the statutory definition of ‘rent burdened,’ this streamlined timeline helps us move more efficiently through the required land-use review while still meeting all applicable standards.”
HB 4035 fills gaps from 2024 legislation
Woodburn was not alone in its inability to use the one-time UGB expansion process offered under the 2024 law. Rep. Pam Marsh, D-Ashland, said several city officials reported concerns with the existing legislation.
“That expansion was passed because we have a housing crisis and we really want to get cities into the business of encouraging housing,” Marsh said. “But if the one-time expansion isn’t working, the housing crisis isn’t going away.”
The 2024 law only applied to cities considered “severely rent burdened,” which means 25% of households are spending at least 50% of their monthly incomes on rent. House Bill 4035 would cover “rent burdened” cities, where at least 25% of the city’s households spend more than 30% of their monthly incomes on rent.
It also would expand the acreage limits from 100 acres to 150 acres for bigger cities, defined as areas with populations over 25,000 people.
Other changes in the bill allows cities to use resource land, like forest or farmland, which was previously not allowed under the previous law.
“We found that there were some cities that are either largely or fully surrounded only by resource land, so we defined a very targeted opportunity to allow those cities to use resource land if that was really the option that was available to them,” Marsh said.
Woodburn takes next steps for UGB expansion under HB 4035
For Woodburn, a city surrounded by farmland and the home to many farmworker communities, additional provisions gave them a path forward with the site, especially with the existing convenience of the site location.
“Because the site is already adjacent to urban services and no longer in active agricultural use, it represents a meaningful opportunity to put this land to work in meeting Oregon’s urgent housing needs,” the city of Woodburn wrote in a statement to the Capital Chronicle.
Prior to amending HB 4035, Sen. Kim Thatcher, R-Keizer, and Rep. Lesly Muñoz, D-Woodburn introduced Senate Bill 1564, which would have automatically allowed the site to be developed without an urban growth boundary review process.
The bill, which did not pass out of committee, concerned environmental advocacy groups, including 1000 Friends of Oregon, a nonprofit advocacy group for housing, land use and the environment.
“The superseding bill, the developer who owned the land north of the city was making those promises that they wanted to do that. But that’s different from actually having it in statute and binding,” said 1000 Friends Associate Director and Managing Attorney Mary Kyle McCurdy.
While HB 4035 creates an expedited process for Woodburn in particular, there is still a process before development can be approved on the potential site. Before anything can be built, the developer must submit its site-specific application to the city to be reviewed.
The proposal also has to conform with Woodburn’s development code. Public notice, a public hearing and opportunities for community input are also required. Finally, other decision-making bodies, including Marion County and the Department of Land Conservation and Development, must review and approve the plans.
“UGB amendments typically take years to complete under the standard process,” the Woodburn statement said. “While HB 4035 expedites the UGB expansion process, all subsequent land-use steps … must still follow Woodburn’s established procedures and state law.”
Kotek’s bill expands housing accessibility for older adults
Kotek’s bill to expand opportunities for manufactured homes for seniors was the second modification made to the 2024 legislation. Under HB 4082, land can be added to the UGB to support housing for older individuals and manufactured homes on non-resource lands, requiring that at least 80% of units be affordable units for at least 30 years.
In a press release introducing the bill, Kotek expressed the importance of this legislation for older adults in Oregon.
“Too many older Oregonians are one emergency away from losing their housing,” Kotek said. “House Bill 4082 helps cities create affordable homes for seniors and supports lower-cost manufactured home communities so people can age in place with dignity and stability.”
Manufactured housing is one of the most affordable housing options and a lack of senior housing is an ongoing issue, Marsh said. With this legislation, both of those concerns can be addressed through the UGB expansion process.
“We’re looking for ways to give manufactured housing and senior housing essentially a leg up in the competition for land development,” Marsh said.
McCurdy noted the benefits of this legislation but added some limitations and points of concern regarding the provision of manufactured homes.
“We know that there’s a need for more manufactured home opportunities, and there’s a need for more senior housing,” McCurdy said. “What we see is this crisis inside urban growth boundaries where we are losing existing manufactured and mobile home parks to redevelopment of those lands for different things.”
Mobile homes are often owned by the residents while the land is owned by another entity. If the landowner decides to redevelop, then that leads to displacement of existing residents and their homes.
“We would like to see policies adopted that protect those parks and those residents from that. The city of Portland has done that,” McCurdy said. “And we’d like to see models along the lines of what the city of Portland has done statewide.”
Looking ahead
As Woodburn moves toward the next steps in implementing the policies that came from this session, Marsh’s focus is on transitional housing and creating affordable housing units for people making 30 to 40% of the median household income.
For McCurdy, investment inside the current UGB is the priority, rather than further expansion opportunities. Particularly, she hopes for a focus on sewer and water system upgrades, road expansion and infrastructure financing. Additionally she wants to grow local government staff capacity to be able to assist in proactive planning in small- and medium-sized localities in Oregon.
“We need those two things to really make the best use of the good land supply we already have for both housing and employment uses,” she said.
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