2026 Legislative Session Recap - $100M in New Bonds for Affordable Housing, no cuts to state housing programs
Housing Oregon entered the 2026 Oregon Legislative Short Session facing an uncertain fiscal environment. In November, the state’s revenue forecast projected nearly a $900 million gap between expected revenues and existing commitments through the end of the 2025–2027 biennium. In response, state agencies were asked to prepare potential budget reductions. Housing Oregon began early engagement with legislators, particularly members of the Joint Ways and Means Subcommittee on Transportation and Economic Development (often referred to as “TED”), as well as members of the housing policy committees and the Joint Ways and Means Capital Construction Committee.
At the start of the session, Housing Oregon identified several top priorities. These included securing Article XI-Q bond authority to support preservation of existing affordable housing, advancing privacy protections for rental housing applications, reforming the mortgage interest deduction to redirect resources toward homeownership assistance, and preventing cuts to critical housing programs such as rent assistance, foreclosure counseling, senior housing programs, and the state’s affordable housing asset management capacity grant program.
Early in the session, Housing Oregon partnered with Habitat for Humanity Oregon and the Oregon Housing Alliance to host a statewide Housing Opportunity Day lobby effort at the Capitol on February 5. The event brought together more than 170 participants and resulted in meetings with 71 legislators, demonstrating broad statewide support for housing investment and strengthening relationships with policymakers.
The state’s fiscal outlook improved somewhat during the session. Housing Oregon joined a cross-sector coalition supporting SB 1507, legislation to disconnect Oregon from certain federal tax code changes enacted through the 2025 federal tax package (“House Resolution 1”). By preventing Oregon from automatically conforming to several federal tax cuts, SB 1507 helped stabilize the state revenue outlook and contributed to closing the projected budget gap.
Despite the challenging fiscal environment, Housing Oregon achieved several key policy victories. Our top legislative priority, HB 4036, successfully passed both chambers. The bill authorizes Article XI-Q bonding authority to support the preservation of existing affordable housing. Housing Oregon worked closely with legislative champions, particularly Representative Pam Marsh and Representative Rob Nosse, to advance the bill through the legislature.
Housing Oregon also successfully supported HB 4123, which establishes privacy protections for rental housing applications. The legislation addresses concerns about how applicant information is collected and stored by housing providers.
Another priority effort was HB 4136, which proposed reforming the mortgage interest deduction by eliminating the deduction for second homes and redirecting resources toward down payment assistance. While the proposal received strong interest and promising vote counts in both chambers, it did not advance before the constitutional deadline for the short session.
Housing Oregon also supported several additional policy initiatives that successfully passed during the session:
- HB 4082, which promotes housing development for older Oregonians and supports the development of manufactured housing communities.
- SB 1521, which includes reforms to Oregon’s inclusionary zoning framework.
- SB 1523, helping bridge the digital divide for tenants.
- SB 1576, which strengthens requirements for accessible housing units in new construction.
Housing Oregon also supported HB 5204, the agency budget reconciliation bill that helped finalize the housing budget for the session.
In total, the session resulted in approximately $100 million in housing bonding authority, including $25 million dedicated to preservation and $75 million for new affordable rental construction through the LIFT program. Just as importantly, Housing Oregon and its partners successfully prevented cuts to critical housing programs during a year when many state programs were facing reductions.
Beyond specific policy outcomes, the 2026 short session helped strengthen Housing Oregon’s relationships with both long-time legislative partners and newly elected lawmakers serving on housing committees. These relationships will be important as Housing Oregon works during the interim with legislative leaders and committee chairs to prepare additional housing legislation ahead of the 2027 long session.