Mayor Jenny Durkan announced Wednesday that she’s proposing a 51-cent fee on all Uber and Lyft rides, along with new minimum wage and benefit standards for drivers and a dispute resolution center for drivers who have been unfairly kicked off the platforms or underpaid.
The city estimates that by 2025, the fee will generate enough funding, $56 million, to fully fund the construction of the downtown streetcar, plus $52 million for affordable housing near transit stops and about $18 million for a new dispute resolution center for drivers challenging unwarranted removal from the ride-hailing platforms or unpaid wages.
The streetcar, which Durkan halted last year after the price to build and operate the project ballooned, faced a capital-funding shortfall of about $65 million. Earlier this year, the city council approved a $9 million interfund loan to restart work on the streetcar; that loan will be paid back with the proceeds from the Mercer Megablock sale.
“By creating a high-capacity alternative in the center city, [the streetcar] will provide an alternative for folks who are taking those short trips in and out of downtown.” – Seattle deputy mayor Shefali Ranganathan
Durkan’s proposal would also mandate that drivers be paid at least minimum wage, plus compensation for benefits and expenses, for all portions of every trip that begins or ends inside the city of Seattle, and increase the current 24-cent fee that pays for wheelchair-accessible vehicles and regulation of the ride-hailing industry.
After 2025, according to deputy mayor Shefali Ranganathan, the fee will “revert to funding transit, bike, and pedestrian projects across the city.”
In a press briefing yesterday, Ranganathan said the city expects that many people taking short trips in Uber and Lyft cars will switch to the streetcar for short trips once the Center City Streetcar is complete, citing a University of Washington survey that found that Amazon employees who use the car services would take transit “if there was quality transit available.”
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Ridership on the existing South Lake Union streetcar has been lackluster, falling 4 percent last year to just over half a million rides in 2018. On the First Hill segment of the line, ridership was up 31 percent last year, to nearly 1.2 million rides.
Ranganathan noted that about half of Uber and Lyft trips in Seattle originate or end inside the center city, which includes South Lake Union, Capitol Hill, and downtown. In a University of Washington survey of Amazon employees who take Uber and Lyft, “many of these folks …said that if there was quality transit available, they would take transit.”
“By creating a high-capacity alternative in the center city, [the streetcar] will provide an alternative for folks who are taking those short trips in and out of downtown,” Ranganathan said.
A new report on Seattle’s municipal golf courses by three consultants (Lund, Scanlan, and Cocker Fennessy) concludes that none of the city-owned golf courses—Jefferson Park, Jackson Park, Interbay, and West Seattle—is sustainable without ongoing subsidies, and that all four courses have significant deferred maintenance needs, totaling more than $36 million. Under each of four scenarios the consultants considered, the golf courses, which collectively occupy 528 acres of city-owned land, will continue to lose money—between $4.1 million to $8.4 million a year by 2027. In 2017, the city spent about $8.4 million to operate and maintain the courses, or about 54 percent of their total cost (the rest is funded through fees, merchandise, and restaurant sales.) The city paid just over $104,000 for the study.
Chelsea Kellogg, a spokeswoman for Mayor Jenny Durkan’s office, said the city will analyze “long-term models to see the financial sustainability of the courses.” At the same time, she said, the Parks Department, “working with other departments, will also begin to explore a range of potential options for these City-owned properties, which could include continuing these outdoor recreation facilities or other potential uses such as adding additional parks and green space, or creating affordable commercial space and housing.”
Since 2006, city policy has called for the golf courses to be self-sufficient, paying for all their own capital and operating costs and contributing 3.5 percent of their revenues—later increased to 5 percent—to the city’s Park Fund.
The report lays out a number of financial options to reduce the golf courses’ losses. They include: Reducing or eliminating the golf program’s ongoing contributions to the city’s Park Fund; increasing user fees; and farming out maintenance to a private vendor, which would reduce labor costs. Two of the four scenarios in the report also involve issuing bonds to pay for deferred maintenance, which would add annual debt service of up to $3.3 million a year to the cost of the program. The argument for doing this work now, according to the report, is that improving the courses and making them safer will make them more popular with golfers; for example, the nets at the Interbay driving range are too low for people to use clubs with long-ball flights, because of the risk of balls flying into the nearby Seattle Pacific University playing fields. “This is a significant safety liability and also a lost revenue opportunity,” the report says.
Last year, the city budget moved about half a million dollars from the parks department into the city’s capital budget to help keep the golf courses afloat. At the time, budget director Ben Noble suggested that one reason for shrinking golf revenues is that “golf just isn’t as popular as it used to be.” The report released last week affirms this conclusion—showing that the total number of rounds declined from 242,868 in 2013 to 206,010 in 2017, and that in the Seattle metropolitan area, golfers play about 12 percent fewer rounds per capita than the national average. (Jackson Park, in North Seattle, and Jefferson Park, on Beacon Hill, both had about 22 percent fewer rounds in 2017 than in 2013.) According to a 2017 survey by EMC Research, about 13 percent of Seattle residents use the golf courses at least twice a year; in that same survey, however, respondents overwhelmingly named golf as their lowest parks spending priority.
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In spite of the downward trend in golfing in Seattle, the report projects that golf rounds will rebound dramatically between 2019 and 2020, spiking 4 percent “when full course play resumes at Jefferson following capital improvements to repair damaged holes.” Overall, the report projects that the number of rounds played will increase, on average, increase 1 percent a year between now and 2027.
The report, which includes comments from a list of 60-plus “stakeholder” in the golfing community, acknowledges that golf is widely considered an “elitist” sport, but attributes this to the fact that private golf courses and country clubs are expensive and exclusive. “If the City does not offer golf as a recreational opportunity, golf will indeed be limited to only those who can afford private or privately-owned public courses where fees are substantially higher than those charged at the City’s four municipal golf courses. In addition to direct cost of fees, players would need to travel outside of the City to find a course.”
One reason for the perception that golf is elitist and expensive that the report does not mention is that although it is—as the report puts it—”open to all,” golfers must either invest in and transport their own equipment or rent it on-site, which adds significant costs—golf clubs, for example, cost $20 a round. That’s on top of fees of $33.75 per round for adults ($38 on weekends). The report recommends that the city consider a new fee for a maintenance fund at each golf course, while noting that raising fees “runs counter to providing access to lower income people,” and that the more discount programs the golf courses offer to schools, youth groups, and off-peak players, the more revenue they lose.
The city has limited demographic information about who uses its golf courses. They do know that the participation rate among women, at 10-17 percent, is lower than the national average of 24 percent, and that participation among people under 50 is well below 50 percent at all of the 18-hole courses. At the Interbay Golf Center, which has 9 holes and includes a driving range and mini-golf course, 53 percent of patrons are under 50. According to the report, however, “There is no data available regarding minority participation rates at Seattle public golf courses.” The report suggests increasing marketing to women and people of color, tracking golfer demographics, and “enhanc[ing] the clubhouse experience to be welcoming to all, including non-golfers.”
Affordable-housing proponents have suggested closing down at least one of the city’s golf courses and using the land to develop new affordable housing. Last year, then-parks director Christopher Williams said, “Maybe we can’t sustain four golf courses. Maybe we can only sustain the two most profitable golf courses in the city ultimately. But we don’t feel we have enough information to be in a place where we can make a compelling case that golf courses should become places for affordable housing.” Another potential obstacle to the affordable-housing plan is that golf courses count as part of the city’s public green space, so that closing even the smallest golf course, the Interbay Golf Center, would represent a loss of 52 acres of “public” parkland.
Durkan’s office says they’re open to the idea. “As we weigh options for the future of the City of Seattle’s four golf courses, Mayor Durkan believes we have an opportunity to examine our golf courses with the goals of supporting our parks and green space, addressing affordability and meeting our racial equity goals as we build a city of the future.”
Next week, the city council is expected to adopt an emergency one-year moratorium on development at the Halcyon Mobile Home Park in North Seattle, to prevent developers from buying the property while the council crafts legislation to preserve the park in perpetuity. That future legislation, which will be developed in council member Rob Johnson’s land use committee, would most likely create a new zoning designation allowing only mobile or manufactured homes on the two properties, similar to a law Portland adopted last year.
If this is the first you’re hearing about the plight of the Halcyon Mobile Home Park, you’re not alone. Although the park, which houses dozens of low-income seniors and their families, has been on the market since last June, it recently caught the attention of council member Kshama Sawant, who called a special meeting of her human services and renters’ rights committee last Friday afternoon to discuss her emergency legislation, which she said was necessary to prevent “US Bank, a big financial institution that does not care about ordinary people, [from] selling the property to a corporate developer called Blue Fern.”
Urging Halcyon’s elderly residents to write to the council and turn out in force for public comment at the full council meeting on Tuesday afternoon, Sawant did not mince words. “It’s important to remind the council that if they don’t act on this, they will be kicking Grandma out, and that’s going to be on their conscience, so we need to make sure that they understand what political price they have to pay for it,” Sawant said.
“It’s important to remind the council that if they don’t act on this, they will be kicking Grandma out, and that’s going to be on their conscience, so we need to make sure that they understand what political price they have to pay for it.” —Council member Kshama Sawant, urging residents of the Halcyon Mobile Home Park to write the council
The sudden “emergency” was news to council member Debora Juarez, who said she couldn’t attend Sawant’s special committee meeting on Friday due to a prior commitment. (Sawant’s committee ordinarily meets on the second and fourth Tuesdays of every month, although it has only met once since last July.) On Tuesday, after Sawant repeated her claim that “the developer, Blue Fern, could vest literally any day now,” Juarez took the mic to “correct the record.”
Among those corrections: Blue Fern has not filed plans to develop the property. The property is not owned by US Bank. And no development plans are in the offing.
It’s true that the property, which was owned by one family but is now part of a trust, of which the University of Washington is a beneficiary, is on the market—with US Bank as the trustee and Kidder Matthews as the broker—but Blue Fern, after inquiring about the preapplication process last October and attending a meeting with the city in December, has decided they do not plan to move forward with the proposal. According to a spokesman for Blue Fern, Benjamin Paulus, “Neither Blue Fern Development, LLC or its affiliated companies are under contract to purchase this property.”
The sudden panic—the last-minute committee meeting, the declaration of emergency, the chartered bus that ferried Halcyon residents and supporters to today’s council meeting—was, in other words, at least partly based on misinformation. Confronted by her colleagues about this, Sawant said the specific details didn’t matter, because “it is only a matter of time before another corporate developer comes along and decides to buy this property, so the residents haven’t been misled.”
Every individual decision to “save” a property, however justifiable in isolation, puts off until another day a discussion we’ve been avoiding since well before the current building boom. Imagine if the city had reexamined single-family zoning and adopted mandatory affordable housing laws 20 years ago, back when the council was busy arguing over every dilapidated apartment building being torn down in South Lake Union. Maybe we would have built thousands of units of affordable housing, and the “luxury” apartments of that era would be affordable to middle-income renters today. Maybe residents of Halcyon Mobile Home Park, and other naturally-occurring affordable housing, wouldn’t feel so desperate at the prospect of moving elsewhere if we had built somewhere else for them to go.
Many of the residents themselves—one of whom fell down during yesterday’s council meeting, causing a brief hush in the room —appeared to believe, as late as yesterday afternoon, that they were at imminent risk of losing their homes. Several residents choked back tears as they testified, saying they were terrified about becoming homeless. These are real, legitimate fears—of nine mobile home parks that existed in Seattle in 1990, when the city council passed a series of similar development moratoria, just two remain—but it’s hard to see how stoking them, by suggesting that the bulldozers are practically at the gate, serves the interests of vulnerable low-income seniors.
Mobile homes are naturally occurring affordable housing, and developing them into other kinds of housing—in this case, townhouses or apartments—creates a very literal kind of physical displacement. It’s understandable that the city council, faced with the prospect of tossing dozens of senior citizens out of their homes, would do everything in their power to prevent that from happening, including creating special new zones that protect mobile home parks in perpetuity.
But there’s a larger question such parcel-by-parcel anti-displacement efforts elide: Why are apartments still illegal almost everywhere in Seattle? Every time the city decides to preserve one apartment building, or one mobile home park, without asking about the opportunity cost of that decision, they are putting off a crucial conversation about Seattle’s housing shortage, and how to solve it. Every time the city walls off another block from development—whether it’s the Showbox, which also got the “emergency moratorium” treatment, or a mobile home park for low-income seniors—without addressing the astonishing reality that two-thirds of Seattle is zoned exclusively for suburban-style detached single-family houses, they are making a deliberate decision that this same thing will happen again.
None of these choices happen in a vacuum. Every individual decision to “save” a property, however justifiable in isolation, puts off until another day a discussion we’ve been avoiding since well before the current building boom. Imagine if the city had reformed single-family zoning and adopted mandatory affordable housing laws 20 years ago, back when the council and anti-displacement advocates were busy litigating the fate of every dilapidated apartment building being torn down in South Lake Union. Maybe we would have built thousands of units of affordable housing, and the “luxury” apartments of that era would be affordable to middle-income renters today. Maybe the residents of Halcyon Mobile Home Park, and other naturally-occurring affordable housing, wouldn’t feel so desperate at the prospect of moving elsewhere, if we had built somewhere else for them to go.
The full version of this story is available at Sightline.
As cities across Cascadia look to technological solutions, such as modular construction, to help address the region-wide shortage of affordable housing, one of the biggest factors currently driving up costs is also one of the most resistant to intervention: Land prices, which can add tens of thousands of dollars to the cost of producing a single subsidized apartment.
Cities don’t have a lot of tools for lowering land costs, but they do own a lot of land—Seattle, for example, is sitting on more than 180 excess or underutilized parcels, many of which are well-suited for homebuilding.
To maximize taxpayer value, most cities usually auction off their excess land to the highest bidder, just like any private landowner would do. But in cities with hot real estate markets, affordable housing developers typically don’t have the financial resources to compete for land with market-rate developers. So publicly-owned land ends up in private hands, forever forfeiting its potential to help overcome one of the biggest barriers to the construction of subsidized homes: acquisition of land to build on. The backers of Seattle’s Rainier Valley Food Innovation Hub, for example, have been repeatedly outbid by private developers.
But what if local governments viewed surplus land not as a revenue generator but an opportunity to reduce displacement and stabilize communities? Several Northwest cities have begun asking that very question. The result is a growing string of affordable housing projects stretching through Cascadia—from the largest one-time investment in housing on city-owned land in Canada’s history, to an affordable housing and preschool development on the site of a former fire station in Seattle.
How much publicly owned land is there?
Enterprise Community Partners’ interactive mapping tool shows publicly owned properties.
Until recently, if you wanted to know what public land was available in the Seattle area, there was no central database—no way to easily find out, say, if a certain fenced-off plot of land that looked ripe for development was owned by the city or Sound Transit or King County, whether it had the right zoning, and whether it was up for sale. In 2015, newly elected King County Assessor John Arthur Wilson decided to do something about that; he directed his office to create a map of every piece of publicly owned land inside county limits.
The nonprofit Enterprise Community Partners expanded on Wilson’s effort, recently launching the beta version of an interactive tool that allows any interested party to use filters to narrow down a list of about 10,000 developable public properties according to specific characteristics, such as zoning, square footage, and eligibility for tax credits.
“In high-cost cities, it’s really becoming impossible for nonprofits to develop on privately owned land,” James Madden, the Seattle-based senior program director for Enterprise, says. “The average land price, as a percentage of the total cost of development in Seattle, is about 10 to 15 percent, and if land continues to get more expensive, [nonprofits] will be priced out completely. Once you’re paying more than $30,000 a door [for land], it gets very hard for a public agency to justify spending beyond that level on acquisition.” Market-rate developers can charge higher rents to compensate for high land costs—an option not available to affordable housing providers.
Changing the rules that have prevented public land from supporting affordable housing
Wilson, the assessor, says the mapping tools might have been merely informational—a database of public land for sale at prices out of reach for most nonprofit housing builders—if the state hadn’t taken the next step, by giving local governments the authority to sell their land below market value or give it away for free. “We raised this issue with [state House speaker Frank Chopp] last year,” Wilson says. “After we pulled together the list of publicly owned land, we said, ‘Here’s the problem: A lot of this land is owned by agencies that have to sell it for fair market value,” putting even public land out of reach for many nonprofit agencies. In response, Chopp supported, and the legislature passed, a bill allowing state and local agencies to transfer land to affordable housing developers at little or no cost.
Local leaders quickly took notice. Seattle city council freshman Teresa Mosqueda, who campaigned on the need to build more dense, affordable housing, proposed and passed two pieces of legislation this year designed to encourage the city to give away its surplus property for free. The first, which passed in July, made it possible for Seattle’s electric utility, Seattle City Light, to dispose of its excess land at little or no cost—a major departure from its previous policy, which required the utility to sell property at fair market value.
The second, which the council passed unanimously earlier this month, requires the city to consider whether surplus land can be used for affordable housing and, if so, to make it available for that purpose. The legislation also allows the city to hold onto land while a nonprofit housing partner secures financing; directs the city’s Office of Housing to partner with “culturally relevant and historically rooted” nonprofits in areas where residents are at high risk of economic displacement; and mandates that 80 percent of the funds from any outright sale of city property go into one of the city’s affordable housing funds.
1. The wait for affordable housing at the Fort Lawton military base in Magnolia—on which, as I noted last week, the city is now spending hundreds of thousands of dollars for security —will continue to drag on at least until the end of this year, after a city hearing examiner agreed to delay a hearing in an appeal challenging the environmental impact statement on the project until the end of October so that the complainant, Magnolia activist Elizabeth Campbell, can secure a lawyer. The appeal process has already been delayed once, until the end of September, to accommodate Campbell’s lengthy vacation to Europe. Campbell said that she was requesting this second delay because of health concerns that have prevented her from participating in the appeal process.
The motion granting Campbell’s request for a delay, which also denied the city of Seattle’s request to dismiss the six-month-old case, includes a salty dismissal of Campbell’s claim that the hearing examiner, Ryan Vancil, should not be allowed to hear the appeal because he once served on the board of Futurewise, a conservation group with no stake in the Fort Lawton debate, and because he has represented the Seattle Displacement Coalition, which works to prevent the demolition of existing affordable housing, in the past.
The city’s rules, Vancil noted, require anyone who files an appeal before the hearing examiner to file any motions to disqualify a particular hearing examiner quite early in the process, typically at least 7 days before the first hearing. That hearing was in May. “As explained at the prehearing conference [on May 15] the Hearing Examiner has not been a board member or officer of Futurewise for two years, and is not currently a member as alleged by Ms. Campbell. Ms. Campbell identified no specific interest in this appeal by either Futurewise, or the Seattle Displacement Coalition. … Ms. Campbell was clearly aware of these facts [and] raised [them] in the context of a response to the Hearing Examiner’s disfavorable order as a form of retaliation.” In other words, Campbell only decided Vancil’s past association with Futurewise was a problem after he ruled against her on an unrelated issue—specifically, the fact that Campbell hadn’t filed her list of witnesses and exhibits by a mid-September deadline.
(Side note: Vancil may not be on the Futurewise board anymore, but the group’s current board includes two attorneys, Jeff Eustis and Dave Bricklin, who have both fought against proposals to allow more density and housing, including Mandatory Housing Affordability, which allows developers to build more densely in exchange for funding affordable housing; a proposed 12-story building in Pioneer Square that would have replaced a “historic” parking garage; a proposed three-story apartment building in Phinney Ridge, which nearby homeowners opposed because they didn’t want to lose parking in front of their houses; and a proposal to make it easier for homeowners to build secondary units on their property. Given that track record among Futurewise board members, serving on the group’s board could be seen as an indication that Vancil is sympathetic to housing opponents like Campbell. The Displacement Coalition, meanwhile, often fights against density and development on the grounds that it displaces people and drives up the cost of housing.)
Campbell claimed that she was unable to file a list of witnesses because of her poor health. But Vancil was skeptical about that claim, noting that Campbell had managed to five no fewer than separate, lengthy motions over a period of about two weeks in September, Vancil said, which “demonstrate[s] Appellants’ capacity to draft documents and work on this case, and/or the ability to have communicated at an earlier date that Appellants did not have the capacity to identify exhibits and witnesses within the time required.”
The next hearing on the Fort Lawton appeal will be at 9:30am on October 29.
2. A city audit of the Navigation Team—a team of police officers and outreach workers that removes encampments and offers services to people living unsheltered in Seattle—concluded that the city has not done enough to provide the kind of “enhanced shelter” that people living outdoors are most likely to accept, and should consider increasing the use of diversion strategies like “reunification”—that is, connecting people to family, and sending them on their way. The idea of reunification is popular in California, where cities like San Francisco provide bus tickets out of town to homeless people who are able to find a friend or family member who will tell the city they are willing to take the person in. Such programs are controversial because, while they do relocate some chronically homeless people outside city limits, little is known about how people in such programs fare at the end of what are often cross-country journeys, and horror stories abound.
Mayor Jenny Durkan’s proposed budget for the Human Services Department notes that enhanced shelters, which provide case management, a place to store possessions, and a place to be during the day, result in significantly more exits to permanent housing than stripped-down, mats-on-the-floor, in-at-9-out-at-7 basic shelters. According to the Human Services Department, 21 percent of people who entered enhanced shelters, like the Navigation Center operated by the Downtown Emergency Service Center, exited into some form of permanent housing. (Permanent housing can include everything from supportive housing in facilities with case management and other services, or a “rapid rehousing” voucher for an apartment on the private market.) In comparison, just 4 percent of those entering basic shelters exited directly into permanent housing.
Despite their higher success rate, the audit found that enhanced shelters are often full, making it impossible for the Navigation Team to refer many, if any, unsheltered people to them. Between March and December of 2017, the report says, there was an average of 18 beds available for all Navigation Team referrals—an average that includes 27 days when fewer than 10 beds were available, and four months in which the average daily vacancy was less than one bed, citywide. This was during a period when the Navigation Team contacted more than 1,800 individual people, many of them more than once.
Finally, the auditor recommended that the city consider “bridge to housing” strategies like the ones in place in San Diego and Sacramento, which employ large, semi-permanent tentlike structures that can house tens or hundreds of people in dormitory-style or more private rooms. The structures are similar to enhanced shelter—24/7 and low-barrier, they allow singles and couples to bring pets and possessions with them—but are less expensive because the buildings aren’t permanent.
The idea, which council members Lisa Herbold and Teresa Mosqueda brought up yesterday, elicited a testy back-and-forth between Mosqueda and Navigation Team director Fred Podesta, who interrupted Mosqueda’s question about the bridge-to-housing strategy by saying, “We need to carefully think about, are people going to accept an enormous, 150-person dormitory that’s in a tent? Before we get too bound up in the efficiency of a particular structure type, we have to think about how our clients are going to respond to it.” When Mosqueda picked up her line of question, Podesta interrupted her again, interjecting, “I just think it’s worth asking the question—if our approach is going to be to offer [housing in that type of structure to] people—’Would you go or not?’ We need to ask those questions before we spend $2 million on a tent.” The city of Sacramento estimates that a 300-bed shelter of this type would cost between $3 million and $4 million a year.
3. Saul Spady, the Dick’s Burgers scion and political consultant last seen soliciting money to defeat the upcoming Families and Education Levy renewal and to fill the seven city council seats that will be up for grabs next year with “common sense civic leaders,” may be improperly raising funds for an election campaign without registering with the Seattle Ethics and Elections Commission and the Public Disclosure Commission.
As I reported, Spady sent an email to supporters in September seeking $100,000 in contributions for a campaign to “educate” voters on why they should oppose the Families and Education Levy ballot measure and support “common sense civic leaders” against incumbent council members next year. The email says that Spady hosted a meeting the previous week—that is, the week of September 3—of “potential 2019 Seattle City Council candidates focused on common sense, fiscally responsible & acountable [sic] government mixed with active citizens who are concerned about the continuing slide of Seattle into the ‘corruption of incompetence’ that we’re witnessing across all sectors of city hall.” The goal of the meeting, Spady continued, “was to engage likely candidates & political donors.”
This kind of unofficial campaigning could put Spady, who owns the ad firm Cre8tive Empowerment, in violation of state campaign finance law as well as the city’s own campaign finance rules. According to the Public Disclosure Commission, new campaigns for or against ballot measures must register with the PDC “within two weeks of forming a committee or expecting to receive or spend funds (whichever occurs first).” The Seattle Municipal Code, similarly, requires campaigns to file with the Seattle Ethics and Elections Commission as soon as they’ve raised or spent any money, announced that they plan to support or oppose a candidate or an upcoming ballot measure, bought an ad or reserved ad space, or put a survey in the field about a candidate or ballot measure. Filing involves paying a fee (about $1,300), setting up a campaign office, opening a bank account, and designating campaign officers. All of this, again, must be done within two weeks of soliciting money or engaging in any other campaign activities. Spady’s email went out on Tuesday, September 11—more than three weeks ago. As of midnight last night, Spady had not filed any campaign paperwork with either agency.
Mayor Jenny Durkan’s $5.9 billion budget proposes hiring 40 net new police officers, funds shelter and rental-assistance programs that had been at risk of being cut while keeping overall homeless funding basically flat, and dramatically increases transportation spending, at least on paper—the $130 million in new funding consists primarily of unspent funds from the Move Seattle levy, which is currently undergoing a “reset” because the city can’t pay for everything it promised when voters passed the levy in 2015. The new transportation funding includes funding 100,000 new Metro service hours, including “microtransit” shuttles to bring riders to the ends of the existing RapidRide lines and to the water taxi in West Seattle. Those additional hours will require Metro to work overtime to add buses, drivers, and bus parking capacity, but Metro spokesman Jeff Switzer says the 100,000 hours were also included in the King County budget that County Executive Dow Constantine transmitted yesterday, as part of a total increase of 177,000 hours of bus service over the next two years.
City budget director Ben Noble said that if the city wanted to significantly increase spending on homelessness, “that is going to have to happen through reprioritizing [funding] or some as-yet-unidentified source of revenues.” Alison Eisinger, director of the Seattle/King County Coalition on Homelessness, says that, given the ongoing homelessness crisis, “it is unconscionable to put forward a biennial budget … without additional resources for housing.”
The budget would also eliminate about 150 mostly vacant positions, eliminate funding for 217 basic shelter beds provided by the group SHARE after June of next year, fund a new city “ombud” independent from the Human Resources Department, to help employees in city department navigate the process of filing harassment or discrimination claims, and pay police officers $65 million in retroactive pay and benefits from the four years when they were working without a union contract. Officers, Durkan said, have “gone without even a raise but also [without] a [cost of living adjustment]. There hasn’t been pay raise since the beginning of 2014, so that’s four years of pay increases. … You can get to seemingly large sums really quickly.”
In contrast, the budget proposes making an “inflationary increase adjustment” to what it pays front-line homeless service providers of just 2 percent—less than the actual inflation rate.. Earlier this year, the Downtown Emergency Center sought more than $6 million for salaries and benefits—enough to raise an entry-level counselor’s wages from $15.45 an hour to $19.53 and to boost case managers’ salaries from a high of about $38,000 to $44,550 a year. (Currently, the lowest-paying job listed on DESC’s job board pays $16.32 an hour.) “Even a non-police officer, just a clerical position in a city department, is earning more money in salary—let alone salary plus benefits—than somebody whom we are asking to go out under bridges and work with people who have had years of being brutalized in this world,” Eisinger says.
I’ll have a lot more to say about specific budget proposals over the coming weeks as the city council digs into the details in a series of budget briefings that start on Wednesday, but for now, here are a few more highlights from the mayor’s proposal:
• Durkan’s proposed budget does not include any additional funding for a supervised consumption site (mobile or permanent); instead, it simply pushes $1.3 million that was supposed to fund a place for users to consume their drug of choice under medical supervision, with access to wound care, treatment, and case management forward into this year’s budget. Durkan said Monday that the city would not move forward with supervised consumption site until Durkan is “sure [that King County is] still willing to step up and fund the treatment portion of” a supervised consumption site. Activists, including at least one mother who had lost her son to a heroin overdose, stood outside the Pioneer Square fire station, where Durkan delivered her budget speech, protesting the fact that Durkan’s budget calls for continued inaction on safe consumption sites. It has been more than two years now since a King County task force unanimously recommended supervised consumption as part of a holistic strategy for tackling addiction to heroin and other drugs, the rest of which is slowly being implemented and funded.
Marlys McConnell, whose son Andrew died of an accidental heroin overdose in January 2015, was wearing a “Silence=Death” t-shirt and holding up the right side of a large banner that read, “Overdose is killing a generation. Is it time to act yet, Mayor Durkan?” She said a safe consumption site could have helped diminish the shame her son felt about his own addiction, which he tried to hide from his family. “Had there been a space available for him, I would very much hope that he could have gone and taken advantage of it and been treated with love and respect and dignity. That could have been a bridge to treatment and other services early on.” McConnell is aware of the argument that safe consumption sites enable drug users to continue in their active addiction, but says, “You don’t get [recovery] ’til you get it.”
• Durkan said she would not support selling off more public land to pay for city budget priorities, as the city has done in the past. (The sale of land in South Lake Union funded new shelter beds and “tiny house village” encampments, as well as a rental-assistance program—all part of the nearly $20 million in services that this year’s budget proposal makes permanent.) The city has put its largest remaining property in South Lake Union, the so-called “Mercer Megablock,” on the market, but Durkan said the city would strongly prefer leasing the property long-term under a master lease to selling it outright. Affordable housing advocates have suggested that the city hang on to the property and use it to build high-rise affordable housing. Noble told me that nothing technically bars the city from using at least some of the land for affordable housing (either city-owned or built by a nonprofit housing provider); however, he noted that because the Seattle Department of Transportation used restricted gas-tax funds to pay for some of the Mercer Corridor Project, which used part of the megablock for construction staging, the city has to pay back SDOT (a cost that could account for about 40 percent of the proceeds from the property) before it can start building anything or funding other projects on the property. The city also has taken out significant debt on the future proceeds from the sale of the megablock site, which would also have to be repaid. Finally, high-rise housing is generally much more expensive (and therefore less appropriate for affordable housing) than low-rise, because it involves glass and steel, although advances in technology are slowly making high-rise affordable housing more feasible.
• Durkan’s budget is mostly silent on the question of the over-budget Center City Streetcar (currently stalled so city consultants can determine whether the city should finish building the downtown connector or cut its losses), but it does include about $9 million in funds over two years to help operate the existing South Lake Union and First Hill streetcars. Previously, the city had backfilled streetcar revenue shortfalls periodically as revenues consistently fell short of projections. The new budget pays for those anticipated shortfalls up front. “We’re trying to be more upfront and honest about what it’s costing for the streetcar so that we won’t continue to run in the red and having to incur the debts that we’ve seen” in the past, Durkan said.
• The transportation budget is otherwise a mixed bag for transit proponents. It includes $1 million to pay for an expanded study of congestion pricing (as currently conceived, a toll for people who want to drive into the center city during certain hours); funds new investments in adaptive signal technology, which Durkan touted as a solution for slow and delayed buses but which the National Association of City Transportation Officials says “can result in a longer cycle length that degrades multi-modal conditions” and is best for moving cars in suburban areas; and proposes asking the legislature to change state law barring the city from using traffic cameras to enforce rules against blocking bike and bus lanes. “Right now, you have to have an actual officer come over and pull them over,” Durkan said—an expensive proposition. The budget also eliminates funding for the “Play Streets” pilot program, which permanently activated some street right-of-way for active (non-car) use, and cuts funding for any new “Pavement to Parks” projects, “takes underused streets and creates public spaces for community use on a year-round, daily basis,” according to the budget.
• The proposed budget moves almost half a million dollars from parks department spending on the city’s four golf courses into the separate capital budget as a “bridge solution” for an ongoing revenue shortfall. Although the city recently invested in improvements to its golf courses—hoping that better facilities, along with higher fees, would bring in more revenue—that hasn’t panned out, and the city has hired a consultant to evaluate the program. Asked why the golf courses aren’t penciling out the way the city had hoped, Noble said that it may be that “golf just isn’t as popular as it used to be.” Affordable-housing proponents have suggested closing down at least some of the city’s golf courses and using them as sites for affordable housing.
The city council begins hearings on the mayor’s budget this week; a full schedule of budget meetings is available on the city’s website.
In a move so predictable it hardly even merits an I-told-you-so (but I did tell you so), the owners of the building on First Avenue that houses the Showbox have sued the city in response to a land-use decision that effectively downzones their property from 44 stories to two, arguing (among other things) that the move constitutes an illegal spot zone and a taking of private property worth $40 million—the sum for which the owners had planned to sell the land.
To unpack the story—which David Kroman broke on Crosscut earlier today—it helps to recap a bit of the whirlwind history that led us to this point. Last month, news broke that a Vancouver developer called Onni Group planned to tear down the Showbox and redevelop the property as a 440-foot-tall apartment building with 442 units, which could have included a new ground-floor music venue. The city council had just upzoned the property as part of the city’s Mandatory Housing Affordability plan, which grants developers in some areas, including downtown, the right to build taller and denser in exchange for building or funding affordable housing. However, a public outcry—spearheaded by music fans and amplified by anti-development council member Kshama Sawant, who saw the controversy as an opportunity to stop a “greedy developer” from profiting from a new high-end development—prompted “emergency” legislation that expanded the Pike Place Market Historical District to include the Showbox property for at least the next ten months. (The property is owned by strip-club magnate Roger Forbes, who also owns the Deja Vu Showgirls club down the street; the Showbox itself is operated by a tenant, AEG Live, which describes itself as “the world’s second largest presenter of live music and entertainment events.”) Initially, Sawant proposed a dramatic expansion of the historical district that would have effectively downzoned a dozen existing properties and forced property owners to obtain permission from a historical commission before renting to new tenants or making any visible changes to their property, but that was eventually scaled back and only the Showbox property got the “historical” designation. The new rules last for ten months—long enough for the city to decide whether to extend them and make the two-story Showbox building a permanent part of Pike Place Market, and long enough (or so the “Save the Showbox” crowd hoped) to convince Onni to go away and for supporters to put together a plan to preserve the space as a music venue in perpetuity.
That brings us to the present, and the lawsuit filed last week. The suit claims that the city council violated the owners’ property rights by passing a spot rezone that reduces its value by tens of millions of dollars; that they violated the state’s Appearance of Fairness Doctrine, which requires officials like council members to keep an open mind on so-called quasi-judicial land use decisions (like zoning changes for a specific property) until after all the evidence has been presented and to make their deliberations in public, not behind closed doors; that the inclusion of the Showbox in a historical district designed to protect farmers and small-scale artisans is “the definition of arbitrary and capricious”; and that the “illegal spot zone” violates the city’s comprehensive plan, which calls for more density in places like downtown Seattle. “The Decision [to expand the historical district to include just the Showbox] bears no rational relationship to promoting a legitimate public interest; it singles a small area out of a larger area for use and development restrictions that are not in accordance with similarly situated neighboring properties and not in accordance with the City’s Comprehensive Plan.”
The fairness doctrine allows council members to have a general opinion on land use questions; it doesn’t allow them to go into a land use discussion with their minds made up, and it certainly doesn’t allow them to actively campaign on behalf of one side or another in a quasi-judicial land use debate.
The argument that the council’s vote to put the Showbox in the Market historical district represents a spot rezone—that is, that it effectively turns a property with a 440-foot height limit into one with a limit of just two stories, the height of the existing Showbox building— is critical. If the court accepts this argument, they may also be inclined to accept the property owners’ argument that council members, particularly Sawant, violated the law by discussing the decision outside the public eye, and participated in a campaign in favor of the rezone. The fairness doctrine allows council members to have a general opinion on land use questions; it doesn’t allow them to go into a land use discussion with their minds made up, and it certainly doesn’t allow them to actively campaign on behalf of one side or another in a quasi-judicial land use debate. (If this argument sounds vaguely familiar, you probably remember it from Strippergate—a scandal that contributed to the defeat of two city council members who violated quasi-judicial rules when they discussed, and voted for, a rezone to allow strip-club owner Frank Colicurcio to expand the parking lot at his Rick’s strip club in North Seattle. In an odd turn of fate, Showbox property owner Forbes purchased Rick’s from Colacurcio in 2011.)
The lawsuit echoes a point that I have made numerous times at The C for Crank about basing policy on the wishes of a vocal few—in this case, music fans and industry employees who sign petitions and hold signs that say “Save the Showbox” and write songs bemoaning the inexorable fact that cities change: “When politicians cater to populist calls – whether those calls are ‘lock her up,’ ‘build the wall’ ‘ban Muslims,’ or ‘Save the Showbox’ – civil and other rights are placed at risk. Populism, and politicians’ desires to appease their loudest constituents and generate headlines must, however, yield to the rule of law. Luckily for those who prefer protection of civil, constitutional and property rights, the courts exist to preserve, protect and enforce the rule of law.” Indeed, the suit argues that the council caved to public pressure in order “to enhance its political popularity” and “enacted an unlawful ordinance that was intended to, and did, place all the burden of providing a public music venue to City residents onto the shoulders of a private landowner. The ordinance greatly and instantly devalued the property and will scuttle its redevelopment unless the City’s improper spot down zone is declared unlawful.”
The owners of the Showbox property don’t mention race and social justice in their lawsuit. But had they done so, I suspect that the city would have trouble making the case that protecting the Showbox, a venue where tickets typically start at $35 once all of AEG’s “convenience” and other fees are included, advances its race and social justice goals. Particularly when doing so means foregoing $5 million to build housing for people who can’t afford $35 concert tickets.
The complaint also takes a swing at the notion—which several council members, particularly Lisa Herbold, made explicit during the debate over the historical designation—that the squat, repeatedly remodeled Showbox building itself is “historic.” The city, the lawsuit notes, hired a consultant to consider the Showbox for historic landmark status in 2007, but found that the building lacked “any redeeming landmark features.” This, the complaint continues, “was partly because the building had been remodeled during its many uses in the past including as a comedy stage, an adult entertainment arcade, a furniture store and a bingo hall.” When Showbox preservationists talk about “silencing the ghosts of Seattle’s history,” as one of the venue’s bartenders did last month, is that the history they’re thinking of?
One final note. Ordinarily, when the city makes land-use decisions, it puts those decisions through a rigorous Race and Social Justice Initiative (RSJI) analysis to determine what impacts the decision might have, positive or negative, on marginalized and low-income communities. As far as I can tell, the city did no such analysis when it decided to effectively downzone the Showbox block—a decision that also meant foregoing about $5 million in funding for affordable housing under MHA. The owners of the Showbox property don’t mention race and social justice in their lawsuit, perhaps because such goals are hard to quantify (and harder still in the absence of the usual analysis). But had they done so, I suspect that the city would have trouble making the case that protecting the Showbox, a venue where tickets typically start at $35 once all of AEG’s “convenience” and other fees are included, advances its race and social justice goals. Particularly when doing so means foregoing $5 million to build housing for people who can’t afford $35 concert tickets.
The following is a guest editorial about a proposal by King County Executive Dow Constantine to spend $180 million in hotel/motel tax revenues on maintenance and capital improvements to Safeco Field, on which the Seattle Mariners’ lease is about to expire. The Mariners, and Constantine, have argued that the county has an obligation to spend future hotel/motel tax revenues on the stadium; housing advocates have countered that a larger portion of the lodging tax should be spent on affordable, transit-oriented housing. The King County Council meets this morning to discuss, and possibly vote on, the proposal.
Later this morning, the King County Council could decide how to allocate the remaining 25 percent of the county lodging tax revenues. Council members face a stark choice: Use the dollars for affordable housing or offer a $180 million subsidy to a private corporation. The highest value of public and economic benefit the County can create with this revenue is to invest in affordable housing, community development, and good jobs.
Demand for affordable housing in our region is at an all-time high, which is why we should use lodging tax revenues to help address homelessness and promote affordability. To maximize economic benefit from the hotel/motel tax, the County should also create high quality jobs for our communities by utilizing community workforce agreements with housing developers or local housing authorities. These agreements help create apprentice opportunities and ensure dollars flow to the pockets of lower-income workers, which creates a greater economic benefit since low-income households spend a greater percentage of their income on goods and services than higher-income households do.
Multi-billion-dollar for-profit corporations asking for public subsidies must prove that these resources are better spent on their enterprises than other compelling public needs, like affordable housing. And they must commit to transparency and accountability with regard to how those resources are used. The Mariners are a successful team that many people love and support. Yet, for continued public investment, they must demonstrate exactly what they need public resources for and how it will support good jobs in the region. To date, the Mariners ownership have simply not met this benchmark.
Recent letters from Craig Kinzer (current) and Terrence Carroll (former), members of the Public Facilities District (the committee that has been in lease negotiations with the Mariners) reveal that the proposed lease is simply a bad deal that should be revisited.
The Mariners are a successful team that many people love and support. Yet, for continued public investment, they must demonstrate exactly what they need public resources for and how it will support good jobs in the region. To date, the Mariners ownership have simply not met this benchmark.
The Mariners’ owners even want to do away with the annual requirement that they publicize financial information about where the public dollars go, so we won’t know until after the fact whether the dollars were used appropriately. The new lease deal must include financial transparency so that the public can understand how investment in a stadium would maximize public benefit and support good jobs. Instead of a win-win deal for the public, the lease and subsidy appear to be a win-more for the Mariners ownership.
We recommend the following uses and requirements of the County’s lodging taxes.
1. The vast majority of the remaining 25 percent of future lodging tax revenue should be committed to affordable housing. Funding should also be considered for community-based economic development that creates even more jobs and stability for communities at risk of displacement. By investing in community development, we will create good jobs, apprenticeship opportunities, and net income for our communities as families find more money in their pockets for basic needs.
2. Any projects funded by lodging tax revenues must be covered by a community workforce agreement (CWA) that guarantees good jobs, worker retention, high-quality apprenticeship opportunities, and a priority to hire local residents most in need of those opportunities. Both the City of Seattle and King County have highly successful priority hire programs that show tremendous public value when done right.
3. Any use of lodging tax revenues must have the highest level of transparency and accountability. While nonprofit housing developers typically must account for every public dime that they spend, we do not apply the same scrutiny to private corporations that receive public resources. Any money that goes to the ball park should require that the Mariners ownership open their books to the public and show the number and quality of jobs that they are creating with public support.
As a result of our upside-down tax code, where low-income people pay up to seven times more of their income in taxes as the top one percent, state and local revenues for needed services and community development are scarce. We must take care on how our region allocates funds, and ensure that new investments maximize public and economic benefit. Like the other groups who are also interested in these funds, the Mariners must demonstrate clear need and a clear financial case for their request.
Many of the King County Councilmembers have not yet decided how to prioritize investments from the lodging tax. Now is the time to let them know that housing, good jobs and meeting community needs is the highest priority.
Nicole Vallestero Keenan-Lai is the Executive Director at Puget Sound Sage. She has more than a decade of experience in research, advocacy, civic engagement, racial justice organizing, social services, and community and business outreach.
David Rolf is the founding president of SEIU 775, which represents more than 45,000 long-term care workers in the Pacific Northwest. He serves as an International Vice President of the Service Employees International Union (SEIU).
Misha Werschkul is the executive director of the Washington State Budget & Policy Center, where she guides the organization’s strategic vision and ensures its position as a leading voice shaping the debate around budget priorities.
SCALE, a group made up primarily of activist North End homeowners, is suing the city to prevent the implementation of the Mandatory Housing Affordability plan, which—in addition to allowing increased density in multifamily areas around the city—would allow duplexes, townhouses, and low-rise apartment buildings to be built on six percent of the land currently zoned for exclusive single-family use. In exchange for the right to build about one story higher than what’s currently allowed in these areas, developers would be required to build affordable housing on site or pay into a fund to build affordable apartments elsewhere. The city has already implemented MHA in a number of areas, including the University District, South Lake Union, and downtown, where Showbox fans are trying to stop one of the first developments proposed under the new rules.
Since the beginning of its drawn-out attempt to kill MHA, SCALE has mischaracterized the plan as a citywide upzone, which it is not; currently, two-thirds of Seattle’s residential land is reserved exclusively for suburban-style detached single-family houses, and MHA would only remove a tiny sliver of land at the edges of those areas, adjacent to “urban villages” and “urban centers” that are already dense and well-served by transit. As council member Debora Juarez said last week, “with that six percent, what we’re trying to do is right a historical wrong”—that is, racist redlining—”because we know that for people of color, marginalized communities, refugees, and immigrants, in order for us to build wealth, we need to have a home.”
Historically, SCALE and its leaders—who include Toby Thaler, head of the Fremont Neighborhood Council, Bill Bradburd, a onetime city council candidate who called the city’s entire Housing Affordability and Livability Agenda “dumb,” and Sarajane Siegfriedt, a longtime Lake City neighborhood activist —have argued that townhouses and small apartment buildings violate the “historic character” of single-family areas. But last month, they switched tactics, portraying themselves as social justice advocates and defenders of low-income communities. Making their case to hearing examiner Ryan Vancil, SCALE argued that the city failed to consider feedback about the impacts of expanding urban villages on low-income people and people of color in conducting an environmental impact statement (EIS) about the proposal, and then tried to bury that feedback.
In fact, the city spent the better part of a year doing outreach to nontraditional neighborhood groups and marginalized communities to find out their concerns about the potential impacts of MHA and wrote a final EIS that responded explicitly to those concerns, changing the zoning mix in neighborhoods with a high risk of displacement in an effort to help people stay in those communities.
SCALE’s evidence for the supposed coverup: A single letter from a group of city employees, known as the Race and Social Equity Team, who were charged with reviewing the city’s draft environmental impact statement for the MHA plan through a race and social justice lens. Their report (pages 9-18), which was submitted several months after the end of the public comment period for the draft version of the plan, suggested that the city needed to go further than it did in the draft EIS to address the race and social justice impacts of upzoning low-income neighborhoods where people of color are concentrated.
“A number of honorable city employees conducted a thorough review of the race and social justice equity aspects of the EIS, but the city executive administration ignored their work,” Thaler said at a special city council meeting on the plan last week. “There is no explicit reference in the EIS to [race and social justice at all.. … Read the record! This is a coverup!”
The letter, submitted by Seattle Department of Construction and Inspections staffer Dan Nelson on behalf of staffers at several city departments, says the draft EIS “did not consider race as deeply” as other factors related to housing affordability, and suggests that the city should collect “qualitative information” from community residents about what historic resources and cultural assets they consider most important and vulnerable to displacement as MHA moves forward, and to continue doing so on an ongoing basis as MHA proceeds.
There is ample reason to do this kind of analysis. Historically, zoning (both official and unofficial, through policies that redlined people of color out of the most desirable areas of Seattle and cities across the country) has been used as a tool of discrimination against people of color in cities. In order to avoid perpetuating that legacy, race and social justice must be considered carefully as part of every land-use decision the city makes. The city also, it must be said, has not made this a top priority until relatively recently; Seattle’s Race and Social Justice Initiative, an effort to programmatically eliminate institutional racism within the city itself and in city policies, still has not been fully implemented 13 years after it was adopted in 2005. Many of the recommendations in the race and social equity team’s letter involve addressing race and social justice proactively in the future, not just with MHA but with other policy initiatives that impact communities of color. Undeniably, this is an area where the city still has work to do.
Looking only at MHA, however, it’s important to note that contrary to what SCALE is claiming in its lawsuit (and what they are using Nelson’s letter responding to a 2016 document to retroactively demonstrate), the city did do an intensive analysis of the race and social justice impacts of MHA after the draft EIS was released. The letter, which reflects concerns about the draft version of the document—namely, that it did not adequately consider the plan’s potential for driving people and institutions out of their neighborhoods through physical and economic displacement—was just one of dozens of responses from community groups, committees, and interest groups across the city, whose extensive feedback is summarized here.
The MHA process included many new kinds of community outreach—led by former neighborhoods department director Kathy Nyland—aimed at reaching communities that have been poorly served by traditional neighborhood groups like the neighborhood councils that make up most of the SCALE “coalition”. I covered a number of these, including the city’s new community liaison program and Community Involvement Commission, last year.
Contrary to what SCALE is claiming in its lawsuit (and what they are using Nelson’s letter responding to a 2016 document to retroactively demonstrate), the city did do an intensive analysis of the race and social justice impacts of MHA after the draft EIS was released.
Taking all that feedback into consideration, the city then changed the proposal between the draft and final versions to explicitly discourage high-intensity development in areas that were determined, through a separate process called the Seattle 2035 Growth and Equity Analysis, to have both a high risk of displacement and low access to economic opportunity, which tend to be neighborhoods with high numbers of low-income people and people of color. (“Displacement risk” was determined by factors such as race, ethnicity, and “linguistic isolation,” according to the city.) At the same time, the final EIS emphasized development in areas with a low risk of displacement and high access to opportunity—the same north-of-I-90 neighborhoods, in other words, where most of SCALE’s members own houses.
The changes the city made between the draft and final EIS came response to direct community feedback, independent of the letter from city employees that SCALE considers its smoking gun. Those changes include:
• Reducing the amount of new housing that can be built in several areas where community members raised concerns about displacement, including the 23rd and Jackson-Union, Othello, and Rainier Beach residential urban villages;
• Increasing the zoning capacity in areas that have historically excluded low-income people and people of color—defined in MHA as places with low displacement risk and high access to opportunity—such as the Admiral residential urban village in West Seattle and the Ballard hub urban village, to encourage more development in those areas; and
• Amending the EIS between the final and draft version to explicitly direct the city’s office of housing to spend payments collected for affordable housing from developments in high-displacement risk neighborhoods into affordable housing in those neighborhoods.
Last month, SCALE rested its case before hearing examiner Ryan Vancil with testimony from, among others, Maria Batayola, a former Beacon Hill resident who testified that she has lived in Bellevue for four years but who still chairs the Beacon Hill Community Council’s land use committee. Batayola testified that her group joined SCALE in its lawsuit because they believed the city had failed to consider race and social justice in deciding which areas would receive upzones under MHA. But on cross-examination from an attorney with the city, Batayola said that she thought Nelson’s letter, and the Race and Social Equity Team’s report, were in response to the final document, not the (substantively different) draft. (Under questioning, Batayola reversed herself. She did not discuss the changes the city had made since the first version of the EIS.)
The hearing on SCALE’s lawsuit will continue later this month, and will likely last well into September; MHA can’t move forward until the lawsuit is resolved. Meanwhile, the housing crisis continues. Every day that MHA is not in place, the city loses out not only on opportunities to address the ongoing shortage of market-rate housing, it loses out on funding for affordable housing as well—a slow drip-drip-drip that adds up to millions of dollars in lost housing opportunities.
Whether restricting the creation of housing—any type of housing—will work as a long-time anti-displacement strategy is, of course, another question—one that city council member Teresa Mosqueda posed at last week’s meeting. “I still struggle with the terminology that if we were to do more development—again, through the community lens, led by community organizations and neighborhood leaders who who can talk about the type of housing that they’d like to see—we can actually benefit by seeing increased housing and density requirements in some of these areas that are being called at risk of displacement.
“If they are at risk of displacement, then [it seems like] we would like to see more opportunities for folks to live in those areas and not get pushed out,” Mosqueda concluded.
Note: This post originally identified the Fremont Neighborhood Council as the Fremont Neighborhood Association.
That’s the bet a number of modular construction companies in the Pacific Northwest are making. Building in Cascadia is expensive. Labor is scarce, and rents have surged since the last recession. Firms like Blokable, Katerra, and OneBuild say that by moving much of the process off building sites and onto factory floors, they can cut the cost of constructing multifamily housing by over half. They also say they can finish projects in half the time. If these claims prove true, these companies and other like them could shake up the housing industry in cities like Seattle, where the total cost to produce a single apartment home can surpass $300,000.
The costs of physical construction—the “hard costs”—are the single biggest determinant of the selling price or rent of a new home. If modular construction slashes hard costs, homebuilders will make more homes—precisely what’s needed to control rising rents in cities facing housing shortages. Cutting hard costs also makes it possible to stretch public funds further, yielding more subsidized homes for low-income families as well.
So modular construction could be a housing affordability game-changer.
Modular construction is hardly new. Mobile homes, a type of modular housing, have been a popular form of inexpensive housing for decades, and single-family modulars have become a relatively cheap option for first-time homeowners and empty nesters who don’t need lots of space. What is new is the idea that modular construction methods can be used to revolutionize the entire construction industry. This could be especially true for apartments and condos—the productivity of which has barely increased since 1945, according to the McKinsey Global Institute—and bring down the cost of housing in the process.
To understand why multifamily housing construction is so expensive, it helps to know how it’s usually built. The orchestrator of the whole process is the developer—the business person who puts the deals together, securing funds from a bank or investors (or government or charitable agencies, for subsidized housing), and hiring professionals to design and construct the building. Typically, the developer selects a general contractor, and that contractor, in turn, hires subcontractors, who then often hire sub-subcontractors, and so on. Eventually, the contractor at the bottom of this chain actually does the work. Every layer of subs takes on some of the huge risk of a giant construction project but also drives up costs.
Meanwhile, construction labor is at a premium nationally in the United States, and even more so in Cascadia’s booming major cities. According to a recent analysis of affordable and market-rate multifamily construction costs in Portland, “a severe shortage of both skilled and unskilled labor in the PDX construction market” has led to cost escalation greater than the rest of the country.
This shortage boosts construction wages and the cost of housing. On top of that, many construction workers cannot afford to live in the expensive cities that most need more housing, creating a vicious circle of rising rentsexacerbated by a lack of a local workforce to build homes, and so on.
Modular housing minimizes the layers of contractors, putting most or all of the construction processes under the control of one company. It also standardizes everything it can, making home construction more like a modern, automated clothing factory and less like a tailor shop, where each garment is made by hand to custom specifications.