After making $110 billion in overall revenue last year, Microsoft is dropping a boatload of money for housing in the suburbs surrounding its Redmond headquarters. They're giving $500 million in loans and grants over the course of three years, with promises, according to the New York Times, to "lend the money out again to support additional projects" as the loans are repaid.
The company will invest all but $25 million in middle- and low-income housing, with $200 million slated for low-income housing specifically. To put that in perspective, Gov. Jay Inslee's budget only dedicates $140 million for preserving and building "approximately 2,500 affordable and innovative housing units." Microsoft President Brad Smith told the Seattle Times he hopes the Microsoft money will lead to the construction of "tens of thousands of units."
It's impossible to overstate the size and urgency of the region's housing crisis. Last month the Regional Affordable Housing Task Force determined the county needs to build "156,000 more affordable homes today and another 88,000 affordable homes by 2040...if we are to ensure that all low-income families in King County have a safe and healthy home that costs less than 30 percent of their income." So, we need to build 244,000 units of housing in 20 years—and 156,000 of those units yesterday—or else we become San Francisco.
And the number might be higher than that. At a presentation formally announcing Microsoft's pledge Thursday morning, Smith said the company's own study shows a housing gap of 300,000 units.
King County Councilmember Claudia Balducci, who represents Bellevue, said Microsoft's investment will make "a big difference" on the Eastside. She called the area's housing costs "ridiculous," adding that seniors on fixed incomes can't afford rising costs, young professionals can't live where young professionals used to be able to live, and workers in many industries Bellevue depends on can't afford to live in the city at all. "It's at a crisis level for many people," Balducci said, adding, "Our police chief has said publicly that he can’t afford live in the city he serves—and that's the police chief!"
Balducci says the Microsoft money will help address the housing shortage, and she hopes the investment will start "a virtuous cycle," encouraging other companies, cities, and county governments to do more.
Washington Community Action Network organizer Xochitl Maykovich said she feels like she's not supposed to have positive feelings about this new development, but she does.
"Would I rather we have a significant corporate tax so we’re not relying on businesses like Microsoft to arbitrarily decide to give needed resources? Yes," Maykovich said. "But the fact that they're acknowledging that they’re creating and contributing in some ways to the housing crisis is positive. And when a corporation does give a ton of money, we can’t just spit on them."
But Maykovich warns that money isn't the only thing the region needs to solve the crisis. "If they want their money to go further, they need to push for reforms at the city and state level," she said.
Microsoft, for instance, is adding $5 million to the Mariners' Home Base project, which will "beef up staffing at a King County Bar Association legal clinic for tenants facing eviction," according to the Times. But Maykovich says a lot of that money will go down the drain because we have embarrassingly draconian eviction laws. In other states, tenants don't have to pay their landlord's attorney fees after they've been evicted—sometimes after only missing a month's rent. And landlords can't evict over things like late fees and utility charges. But in Washington, they can do all that. So the money from Microsoft and the Mariners will go towards paying off stuff we shouldn't even be paying off in the first place.
Washington State House Rep. Nicole Macri plans to introduce a bill this session that would reform our stupid eviction system. "If Microsoft wants to address this unfair and inefficient process, then they should throw their weight behind this bill," Maykovich said.
Marty Kooistra, executive director of the Housing Development Consortium, said the group is "thrilled with the leadership that Microsoft has demonstrated with this investment." He thinks the move may help "stop the divisiveness" that followed last year's contentious head tax debate in Seattle and will encourage people to "come together across all sectors to find solutions" to the housing crisis.
But Kooistra would also like to see Microsoft "empower and inspire" the company's 47,000 employees to participate in housing advocacy at the city, county, state, and even federal levels. "I would encourage them to continue to make sure there are more opportunities for education for their employees so that everyone knows how they can engage in this issue," he said.