The Seattle City Council is on a crusade to undo the previous council’s marginal progressive wins—from a promise to reinstate archaic anti-loitering laws to an attempt to gut the historic gig worker minimum wage. It appears the hard-fought eviction moratoriums could be next on the chopping block. Those protections keep kids and teachers housed during the school year and keep income-qualifying renters off the streets during the coldest months.
In an email to Council Member Cathy Moore and to the members of her Housing and Human Services Committee, Low Income Housing Institute (LIHI) Executive Director Sharon Lee asked the council to “modify” the City’s winter and school-year eviction moratoriums to exclude “people with income who decide not to pay rent.” Lee told The Stranger that LIHI supports strong tenant protections and called the exclusion of renters with income a “narrow exception” to the moratoriums, not a repeal.
Lee is not some random commenter the council could brush off. LIHI is a major affordable housing contractor with the City and by far the most prolific tiny shelter village developer in the region. I asked the Housing Development Consortium (HDC), an umbrella organization that represents more than 200 members including LIHI, about the popularity of Lee’s proposal among their members. HDC did not respond.
LIHI’s Logic
In a follow-up email to The Stranger, Lee argued that when a “tenant with resources” refuses to pay rent, nonprofit affordable housing landlords suffer “enormous consequences” due to their dependency on private lenders.
“Lenders are now citing the Seattle eviction moratoriums as the reason why they will not provide financing to preserve existing affordable housing in our communities facing displacement and gentrification,” Lee wrote in an email. “If there are no reliable means to ensure timely rent payments to make good on a loan, then the production of affordable housing will take a big hit.”
Lee gave Moore an example in her initial email to the council committee. LIHI wants to acquire and preserve 65 affordable housing units at Squire Park Plaza in the Central District. The nonprofit secured funding commitments with the Office of Housing (OH), the state Housing Trust Fund, and the Washington State Housing Finance Commission (WSHFC), but private lenders keep declining to finance the project. Lee sent the council a cropped, undated screenshot from an email allegedly from an unnamed “bank official.” The bank official wrote that Vanguard, PIMCO, Prudential, Alliance Berstein, Franklin Templeton, Align Capital, Belle Haven, Investco, Nuveen, Banner Bank, Washington Trust Bank, and Heritage Bank “passed on the deal — mainly due to the ongoing issue of the rent moratorium.”
Lee worried that this alleged behavior from private investors may have “ripple effects” for the Low Income Housing Tax Credit (LIHTC) program. As the Tax Policy Center explains, the federal government gives tax credits to state governments, which deal out the credits to developers such as LIHI. Then, developers sell the credits to private investors to get funding for their housing projects. So, Lee said that LIHTC, without which none of LIHI’s projects would pencil, relies completely on private investors playing ball.
Moore did not respond to The Stranger’s request for comment, but should she and her committee pursue rollbacks to the moratoriums, they can expect a fight.
Not So Narrow
For one, “tenants with resources” is a pretty vague exemption to ask for. Lee told The Stranger that LIHI does not have a detailed proposal at this time, but excluding renters with income certainly creates more than a “narrow exemption.”
Of the 3,716 households in King County who last year got counsel from the Housing Justice Project (HJP), an organization that defends low-income tenants in eviction court, 73% reported some income. The largest share of HJP’s 2023 clients–2,241, or about 40%—reported making more than zero dollars but less than 100% of that year’s federal poverty level of $14,580 in annual income. Another 23% of HJP clients last year reported income between $14,580 and $29,160, or 200% of the federal poverty level. The remaining clients made more money, but they still fell below the Area Median Income, according to HJP.
Edmund Witter, managing attorney at HJP, said that exemptions for ability to pay don’t make a whole lot of sense: “I don’t know how you calculate that—people have unexpected obligations, and you are setting up uniform household budget expectations for low-income persons who don’t have savings.”
Who’s Afraid of a Little Ole Legal Defense?
It is unclear if lenders are truly avoiding affordable housing projects because of the City’s moratoriums. The Stranger emailed all of these investors who allegedly declined LIHI’s deal. Only a few responded, but the two who did deny that LIHI approached them about Squire Park Plaza.
Belle Haven Investments Director of Research Dora Lee told The Stranger “it’s not the renter protections” that make lenders pass on affordable housing projects. As the economy comes out of a period of low interest rates into higher interest rates and high inflation, “We’ve seen the industry tighten up its underwriting standards and require more margin and more profitability in the projects that they do underwrite, which is constricting the amount of available capital for affordable housing projects.”
If we take LIHI’s word for it and grant that all the other lenders think the moratoriums specifically ruin profitability for developers, then they should maybe take some deep breaths. The moratorium is not that common of a defense.
Lee could not immediately provide data to show how many evictions the moratoriums have thwarted for LIHI, but as The Stranger reported last year, HJP used the winter eviction moratorium five or six times in its first three years of existence. Now, HJP does cite these laws as a last-resort defense when a household has no other option, but “not often enough such that a landlord the size of LIHI should be going under,” Witter said.
Affordable housing developer Ben Maritz told The Stranger that while he could see room for fixes and clarification with the moratoriums, he said that “essentially no evictions are proceeding to the point of a contested hearing where the moratorium would apply” because of a backlog of eviction cases. Maritz said, “The top priority needs to be restoring the functioning of the courts so that whatever rules we agree on can actually be applied.” On that score, King County Council Member Reagan Dunn has offered a proposal.
Oh, the Humanity!
Aside from lenders and other housing developers offering compelling arguments against Lee’s claims, tenant advocates point out how shitty it is for someone with the phrase “Housing is a human right!” in their email signature to advocate for a policy that could leave more people without housing.
Be:Seattle Co-Executive Director Kate Rubin called LIHI’s request “disgraceful” and in direct contradiction with their mission.
“How dare they claim that they ‘advocate for just housing policies’ and then advocate for removing renter protections in order for them to grow their portfolio,” Rubin said in a message to The Stranger. She asked if LIHI would have enough tiny shelters for all the low-income families they want to kick out.
Unsurprisingly, Council Member Tammy Morales’s office clapped back in an email to Lee.
“Many renters in Seattle with income have had issues with paying their rent,” wrote Morales Chief of Staff Andra Kranzler. “The request to amend the statutes to exclude people with earnings is contrary to best practice.”
As funny as it is that Morales’s office sent Lee a link to the City’s updated renters’ handbook, progressives should brace themselves to defend these tenant protections and whatever else the landlord lobby wants to claw back.
The real estate industry bought the current council, putting big bucks behind Council Members Rob Saka, Maritza Rivera, Dan Strauss, Bob Kettle, and Tanya Woo in their 2023 elections. Real estate interests really liked Moore, putting at least $100,000 into an independent expenditure to support her campaign. And now she’s the chair of the Housing and Human Services Committee.
Morales seems to be the city’s only clear tenant defender. And boy does she have shit to defend for the next three-and-a-half years.
I am so glad I sold my rental property in the CD!
‘Now, HJP does cite these laws as a last-resort defense when a household has no other option, but “not often enough such that a landlord the size of LIHI should be going under,” Witter said.’
The issue wasn’t LIHI “going under,” but rather LIHI’s ability to build more low-income housing, as another source in the story snidely confirmed:
‘“How dare they claim that they ‘advocate for just housing policies’ and then advocate for removing renter protections in order for them to grow their portfolio,” Rubin said in a message to The Stranger.’
The Stranger constantly tells readers Seattle has a “housing crisis.” Well, if Lee is correct, then Seattle has a choice between updating the eviction moratorium, or building fewer low-income housing units. Yelling at “the real estate industry,” for supposedly having “bought the current Council,” does nothing to address the issue Lee described.
The Stranger really should begin to understand the hard political choices involved in providing low-income housing for an increasingly crowded and expensive city. Blaming anyone it happens not to like, and demanding ‘the rich pay their fair share,’ (whatever those eternally-undefined terms actually mean) has never built a single house, and never will.
@1 and I’m sure the person who bought your property was so glad they bought it. your comment is mostly irrelevant without any details. you were first to post though. yay!
Like @2 pointed out, folks like Rubin are part of the problem. The “portfolio” LIHI is trying to grow is affordable housing – that the market is not building. Progressives just can’t tell the difference between progress and purity (they would rather have nothing).
Good luck passing that social housing funding if these idiots continue to purge moderates.
I sold both my duplexes in the CD because of the new laws. I took a lot of pride in making sure all my units were nice. One is getting torn down. The other raised rents 40 percent. Keep passing those laws and see how hard it will be to get an apartment. How was the law not set up so that those with means can’t just decide not to pay rent? Just dumb.
or maybe when you have the head of one of the largest affordable housing organizations in the city telling you there is a problem with the policy, then just maybe the policy really isn’t that good. I know this may be shocking but a lot of the legislation that came out of the office of the former representative from D3 wasn’t vetted or tested, it was purely ideologically based (in this case landlords bad).
I have yet to meet a landlord, large or small, that wasn’t a total piece of shit. Yet, we allow people like this to lord over people’s lives and security every day.
Or, to put this another way, “Major Non-Profit Housing Provider with Years of Experience in Serving Low-Income Populations (unlike the City Council) Advises City that Policy is Counter-Productive.” LIHI is hardly the Snidely Whiplash of landlords.
@7 to paraphrase the
late great hst ‘the Scum
(and pvt eqty!) also rises.’
End housing-as-Commodity
hell, end the Commodifcation
of every single human Necessity
just Three people
own as Much as
Half of the US
someone’s
gotta Give.
@7
I’ve rented from both good and bad landlords. Even the bad ones will warm a bit when they know their tenants take care of the place. I always told them, it was their house, but it was my home.
That being said, I’m glad I own now instead of rent. I can do what I want.
Teachers and school employees are among the most securely employed people in the city. Somebody explain to me why they should be exempt from eviction. They would pretty much have to CHOOSE to not pay rent, or explictly break lease terms to be put at any risk at all.
Why should any landlord have to provide free housing forever for somebody with kids? (all HJP has to do is delay – their specialty – from mid june through september every year) How is that fair? How does that encourage more rental housing?
How about this instead of the winter ban – An eviction can be adjudicated and granted at any time, but actual removal may be delayed if outside temperatures are dangerous AND the person(s) being evicted have not either 1) obtained new housing or 2) been offered shelter services.
Make no mistake these bans are ideological, made by people who would just assume ban all evictions for any reason forever d**n the consequences. LIHI and real estate industry is right to be asking for review and moderation of these ordinances.
@11 try building a deck without paying the city first.
@10 wikipedia says the top 10% has 43% of USA wealth. your top-3 claim appears to come from a 2017 guardian article.
In any case, a thought exercise. Lets say you find a magic wand that takes ALL the wealth of the top 10% and redistributes it evenly to the bottom 50%. Per yahoo finance article top 10% has average wealth of $859K. so lets say 1M to make round numbers. giving that evenly to bottom 50% means everybody gets about 200K each.
Will that make a difference to many in that group? sure. but this is a one time payment. So it would best be spent on things like debt reduction, down payment on homes, higher education or trade school, or bootstrapping retirement savings. It WONT pay for social housing for all, it WONT cover free healthcare, It WONT cover free higher education for all, It WONT save people who have inadequate retirement income. and so on.
In the meantime, we’ve wiped out amazon, microsoft, spacex, tesla, and thousands of other businesses held privately or in shares owned by the top 10%. The investor class is gone. So the economy would crash.
There would likely also be a spate of inflation as inevitably many who got that 200K windfall tried to go on a spending spree.