This guest post is by Seattle City Council member Nick Licata, who chairs the council's Housing, Human Services, Health, and Culture Committee.
Would you like to live in a neighborhood that has many job opportunities, good public transit, a grocery store, a huge public park and interesting restaurants? If you say yes, then move to South Lake Union (SLU) —if you can afford it. And there is the crux of the problem that the Seattle City Council must address: Can we make SLU affordable to those of us who would like to live in a nice neighborhood in Seattle, not in Renton or Kent? The answer is—YES WE CAN. And here is how.
It’s straightforward: In exchange for the city upzoning land in SLU, which in most cases will increase the property owners’ wealth by millions of dollars, the public receives a benefit by requiring the development of that land to contain a percentage of affordable housing. How affordable? I’m proposing that an affordable one bedroom apartment be offered for rent at $975 for a person earning $36,000 a year or less. The mayor and other council members are proposing that a one bedroom rent for $1,200 for those earning up to $45,000. I’m guessing that there are a number of young people and recent immigrants just starting out, that earn less than $36,000, who would appreciate living in South Lake Union.
Other cities make similar requirements of their developers; over 250 cities in California do so. We say we want our workers to live in Seattle. Most large cities with a higher percentage of their workers living in their city than Seattle, also have such requirements. Makes sense. Affordable housing allows workers to live in the city and not have to commute miles away, dependent on public transportation or purchasing a car and getting caught in traffic congestion—not to mention contributing to carbon emissions and global warming.
This is how it would work: Increasing affordable housing units in SLU, or anywhere in the city for that matter, is done by adjusting an incentive program. The programs obligates landowners who take advantage of an upzone to their property to provide a percentage of affordable housing units. The mayor and other council proposals provide less than 5 percent of the total residential floor area to be devoted to affordable housing, whether it is built on site or off site of the rezoned land. My proposal in comparison requires 10 percent for on site development or the equivalent of 15 percent for off site development. The increase in fees to developers allocated to building affordable housing consequently would increase from a high of $22 per gross square foot to $96. Both are applied to 60 percent of the new construction that takes place on their upzoned lot. In comparison San Francisco’s fee is over $300, and their real estate market continues to grow at a faster pace than ours.
So, what’s stopping us?
The fear that developers will not take advantage of the upzoned property; SLU will not see development. That’s what the for-profit developers tell us. Independent financial consultants hired by the City, who do not have an investment in SLU, tell us differently. There is an opportunity before us today to tap into the $12 billion in new SLU development that will occur over the next 25 years. The Mayor in effect has said, “hold on partner let’s not rush,” and formed an advisory group, including a number of for-profit developers, to come back to him at the end of the year to sit down and talk about it a bunch more. In the meantime, if we don’t act now, more than $2 million in affordable housing funds will be lost. WE CAN DO BETTER.
The city council is carefully moving in the direction of making some modest requirements of the developers, to the tune of providing about $600,000 for affordable housing. I support that effort, but I believe we should go for the $2.7 million which would be achievable if we adopt a requirement that is much more in tune in meeting our own projected demands for affordable housing in SLU: where we expect over 50,000 workers by 2031. Currently we are short of our affordable housing goal by 1,700 units and it will grow to over 2,800, even with the other proposals being brought forward.
It’s time that Seattle recognizes it is a major city: being the sixth hottest real estate market in the nation. Seattle needs a future that allows our current and future residents an opportunity to live in the city.