A six-month moratorium on new hotel construction in Portland will go into effect after approval by the city council Monday night.

The city will use the time to consider changes to a zoning ordinance, which has not been effective in its goal of getting hotel developers to build low-income housing.

Councilor Anna Bullet spoke in support of the moratorium. “I do think it’s important to press pause…it allows our city staff to really be able to dig into this,” said Bullet.

That zoning rule – Hotel Inclusionary Zoning – requires developers to build one unit of low-income housing for every 28 hotel rooms constructed. If developers fail to meet that requirement, they must pay a $4,700 fee per room. So far, all developers have paid that fee because it costs far more – as much as double or triple that amount – to build even one unit of affordable housing.

Some city councilors say it would cost $370,000 to build a low-income apartment, but developers would pay only $131,600 on the fee of $4,700 for each of 28 hotel rooms constructed.

Ther Press Herald reports the city has added nearly 450 rooms in the last four years and Portland has more than 800 hotel rooms in various stages of planning as well as more than 400 in the works in the surrounding area. About 500 hospitality jobs are expected to be added.

The city council voted 6-2 to move forward with the moratorium on new hotel construction, which will start in 30 days.

Portland Regional Chamber of Commerce director of advocacy Eamonn Dundon said the moratorium would be counterproductive, effectively just delaying a couple of hotel projects and leaving the city with empty properties. He referred to the zoning rule as a “tax” on hotels.

The zoning rule has been in effect since 2019.