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The city of Portland, in slow and lurching fashion, is beginning to make a move toward increasing affordable housing.

A first City Council hearing of a framework plan for how to spend $258 million in bonds approved by voters is tentatively scheduled for Oct. 11. A second hearing would be held Oct. 18, with a vote possible that day.

If the plan is approved by the City Council, the Portland Housing Bureau plans to open transactions on bond deals on Oct. 20.

鈥淲e’re close,鈥� Housing Director Kurt Creager said.

Mayor Ted Wheeler had asked the Housing Bureau to hold off on spending from the voter-approved bond until a plan was in place.

Part of the plan is a $50 million to $80 million budget for a 鈥渢urnkey projects鈥� pilot program, Creager said. Developers would use their own lines of credit and working capital to build projects and then sell them to the Housing Bureau.

Creager said the program could serve as a 鈥渂ackup plan鈥� for developers who are encountering a market with more supply than it has had in recent years.

鈥淭hey could get their profit and overhead covered, and a reasonable developer’s fee, without coming up with more money to please their bank in a softening market,鈥� Creager said.

The program needs to be well funded to work, he added.

鈥淚 don’t think it should be less than $50 million, because it’s not worth people’s time and money,鈥� he said.

As the Housing Bureau prepares for an influx of funds, private-sector nonprofit developers are finding a tougher time financing deals. Tax-credit equity markets have cooled since President Donald Trump’s election, and interest rates have ticked up.

The combination of more expensive loans and less equity has dented the ability of nonprofit developers to finance projects.

鈥淲e along with the entire industry have tried to figure out how to make up that gap,鈥� said Cynthia Parker, president and CEO of BRIDGE Housing.

Nonprofit developers use a syndicator of tax credits 鈥� the National Affordable Housing Trust 鈥� that is owned by BRIDGE Housing and others. The tax credits are typically combined with bank financing. In July, BRIDGE purchased the Ramona, a 138-unit affordable apartment complex in the north Pearl District. Construction of The Abigail, a 155-unit mixed-income project with 128 affordable apartments, finished last year.

BRIDGE has other affordable projects under way in Hillsboro, the North Macadam neighborhood and the Eliot neighborhood.

The Housing Bureau’s bond money looms as an injection of funds into the affordable market.

Creager said the bureau has a 鈥渕oral and ethical obligation鈥� to build or preserve 1,300 affordable units with the bond dollars as promised. Portland voters approved the bond measure in November; property taxes increased as a result.

The bond funding should arrive at a good time, because the multifamily market is widely expected to slow, Creager said.

鈥淲e recognize that markets are dynamic and we have about four more years to put this money into service,鈥� he said. 鈥淲e’ll be liquid at the right time when the market recalibrates, instead of adding more froth to an already overheated market.鈥�

While the Housing Bureau waits for the influx of bond money, it has made some opportunistic purchases.

In February, the bureau bought the Ellington Apartments in Northeast Portland for $47 million. The purchase preserved 260 units, including 44 affordable ones.

The City Council recently approved a $3.72 million purchase of a parcel at 3000 S.E. Powell Blvd. for affordable housing development. The property across the street from Cleveland High School is now the Safari Club, a strip club.

The site will be home to 100 to 300 affordable apartments, and could be used as an emergency shelter during development, Mayor Ted Wheeler said via Twitter.

The wide range of the number of units is due to different possible configurations for the site, Creager said. At maximum density, the Powell property could have up to 300 multifamily units, but the Housing Bureau is considering building townhouses along the southern edge of the property. That would help blend in with the neighboring homes, Creager said.

The Housing Bureau has been looking for a location to build affordable homes; if it goes this route, it may bifurcate the site, he said.

鈥淚t might be an appropriate place for it,鈥� he said. 鈥淲e’re not sure that maximum density is necessary. It sort of depends on the soil condition we find too.鈥�

The townhomes could be three-level, no-lot dwellings sold to low- and moderate-income households at or below 80 percent of area median income, Creager said.

The lot was used at one time for dumping, and there’s a small landfill that must be excavated and disposed of properly, he said.

On Sept. 30, the $3.72 million purchase and sale agreement will close and the city of Portland will take possession of the property. It’s expected to serve as a women’s and children’s shelter until development of affordable housing on the site can take place.

鈥淯ntil we have an entitled project for development, we’ll probably keep the building in some active use,鈥� Creager said. 鈥淏ecause it’s across from the high school, it’s probably most suited for families or women. The best possible outcome would probably be utilization as a shelter for 12 to 24 months.鈥�

Construction on the site will likely begin in 2019, Creager said.

The Housing Bureau has also acquired a site at Southeast 60th Avenue and Stark Street, north of Mount Tabor.

The property at 511 S.E. 60th Ave. is a YMCA child development center. The YMCA will be able to continue operations in a nearby church during construction at the site, Creager said.

The Housing Bureau aims to build 40 to 50 affordable units, along with a replacement YMCA facility and shared parking.

Portland paid $1.2 million for the property, known as the Mount Tabor Annex. The YMCA’s existing lease means the organization has possession of the property until Oct. 22, 2019, for use as a child-care facility.

A developer will be chosen by the housing commissioner after an open, competitive process, Creager said.