Wednesday, April 29, 2009
City We Should Pass (Most of) the Housing Levy
Posted by Dominic Holden on Wed, Apr 29, 2009 at 2:05 PM
Property taxes that go toward building and maintaining affordable housing would increase by 61 percent—up to $79 a year—for the average Seattle property if voters pass a proposed housing levy this November. That’s less than the alarmist “nearly double” that the Seattle Times reported earlier this morning before removing the statement from its website.
Mayor Greg Nickels’s proposal would maintain the same level of housing assistance as the previous levy in 2002, he told reporters outside a Wallingford apartment building constructed with levy funds. However, due to increasing construction costs and inflation, this package would costs $145 million (69 percent more than in 2002).
“I am confident we will put it on the ballot and I am confident it will pass,” said Council Member Tim Burgess. The city council will deliberate the proposal and hold sessions for public comment in May. However, Burgess added, “I think there is some sentiment in decreasing” the amount of the levy.
One obvious line item to slash is $9 million for first-time homebuyers. The fund would extend home loans to people making 80 percent of the county median income ($51,200 for a two-person household). I’m all for the housing levy, but, as a renter who cannot afford to buy a home, I can’t justify increasing my rent payments so that other people can buy houses.
The meat of the levy: Four-fifths of the the funds would go toward building 1,670 new apartments by constructing new buildings and restoring old buildings. Adrienne Quinne, director of the city’s Office of Housing, says 55 percent of those new units would be reserved for renters making under 30 percent of the area median income, about $17,000 a year. Most of the remaining stock would be reserved for people making between 30 percent and 60 percent of the area median income. Market-rate units would also be sprinkled into the buildings.
The real question, of course, is whether voters will pass this thing. A press packet included the results of a poll commissioned by the city and conducted by EMC Research. It boasts Seattleites support low-income housing funding “more than ever” by a three-to-one margin. However, that wasn’t a voter poll. The survey interviewed a cross section of Seattle adults, says Julie Moore at the Office of Housing. "We can't do polls of voters because that would be a campaign," she says. But the electorate, on average older and more conservative than the general population, could be less likely to support a levy.
The last housing levy squeaked by in 2002, when Seattle experienced a localized recession, garnering only 54 percent of the vote.
But voters should support this levy for families like the Gilberts. After Vernae Gilbert got out of the Army in 2005, she struggled to take care of her daughter, Natahlia, who has cerebral palsy and needs to be near Children's Hospital. Along with Greg Gilbert, they struggled to make ends meet and care for their daughter, while they lived for five months in a motel on public assistance. Then a housing-levy funded building opened in Wallingford. "If we didn't find this place, I don't know what we would do," says Vernae.
Although Dan wondered if the additional housing stock on the market will lower rental costs, making a housing levy unnecessary. But the lower rates are still unaffordable to people making $17,000 a year. For instance, apartments at the recently finished Leva in Ballard—where housing is in surplus—are going at a discount, but one-bedrooms are still $1,200 to $2,000 a month, far too much for thousands of local workers and families like the Gilberts who need a home in the city .
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1
I sure wish Beverly Hills were "affordable". I'd love to live there. I suppose we live where we can afford the rent, etc. If we can't afford something we can't have it. Even if the mantra is "housing is a human right" housing in the expensive areas is not a right. There are in fact affordable housing units in Seattle, but alas they are not in the hip, trendy, coffee shop on every corner, views of the city, artsy areas. Dam it's always something.
Cheap shot to throw in 'it's for the children' (Natahlia). I don't feel I should have to pay for other people's life style choices as no one pays for mine.
Cheap shot to throw in 'it's for the children' (Natahlia). I don't feel I should have to pay for other people's life style choices as no one pays for mine.
3
One technical thing to note. It is very difficult to "sprinkle" in market units when using public funds for affordable housing. This is because Levy money is almost always pooled with federal low-income housing tax credits (through the IRS), which does not support the construction of units at higher than 60% rents (appropriately so). This is the major reason that nonprofit developers do not create "mixed income" housing (i.e. market rates and subsidized rates below 60% of area median income) within the same building. The money that you give up from the credits for construction of the market rate units is not made up for by the market rents that you can charge. This is technical, but important to understand, because it virtually guarantees that all Levy money will be used for renters below 60% AMI, which is a very good thing, especially now, for these are the citizens most vulnerable to becoming homeless in our City during a recession.
4
@1
most people do not choose to become disabled or old. it just happens and it often translates into having fewer decent, safe, affordable housing options.
most people do not choose to become disabled or old. it just happens and it often translates into having fewer decent, safe, affordable housing options.
5
Thanks for the coverage Dominic. Like Natahlia, every child deserves a chance to succeed in life which all begins with their family being able to afford a decent place to live. That's what the Housing Levy is all about.
And, while I can relate to your qualms about the levy supporting first time homebuyers, it's important to note that through groups like Habitat for Humanity and HomeSight, these funds help families from disadvantaged backgrounds, especially people of color, immigrants and refugees.
While outright redlining may not exist in Seattle anymore, home ownership and the access to social and economic equity it can provide continues to be skewed toward whites. By including homebuyer assistance in the levy, we can address the generations of inequity in society and help level the playing field for everyone.
And, while I can relate to your qualms about the levy supporting first time homebuyers, it's important to note that through groups like Habitat for Humanity and HomeSight, these funds help families from disadvantaged backgrounds, especially people of color, immigrants and refugees.
While outright redlining may not exist in Seattle anymore, home ownership and the access to social and economic equity it can provide continues to be skewed toward whites. By including homebuyer assistance in the levy, we can address the generations of inequity in society and help level the playing field for everyone.
6
I have to admit I sometimes wonder about how these things are built. For example, take Yesler Terrace. That's some prime ass real estate right there. The city is currently planning on replacing the current structures with new ones as they are falling down.
Wouldn't it make more sense to sell that land to a developer(or have sold it a couple years ago) and build housing say out by the light rail stations in the Rainier Valley. Seems you could build a lot more housing for the same money and could incorporate it within a redevelopment of the whole area getting mixed income development.
Even still I am not sold on the notion that the city building shit is the best way to do this. I'd like to see some research comparing that to rent subsidies to see if it really serves the most people in the most efficient manner.
Wouldn't it make more sense to sell that land to a developer(or have sold it a couple years ago) and build housing say out by the light rail stations in the Rainier Valley. Seems you could build a lot more housing for the same money and could incorporate it within a redevelopment of the whole area getting mixed income development.
Even still I am not sold on the notion that the city building shit is the best way to do this. I'd like to see some research comparing that to rent subsidies to see if it really serves the most people in the most efficient manner.
8
You may believe that every child deserves a decent place to live, but that doesn't mean that every child deserves to live in an expensive, gentrified city. There is plenty of even cheaper housing than this program will create outside the city limits.
But, say the low-income housing advocates, we need low-wage jobholders to make the city run! That's true, but it's not an argment for low-income housing programs. If there aren't enough low-wage jobholders in the city to do the work that people are willing to pay for, their wages will go up until there are. I'll be paying more because I was willing to cover the cost of the services I chose to buy, not because some central planner decided that the distribution of housing stock wasn't what he wanted it to be.
But, say the low-income housing advocates, we need low-wage jobholders to make the city run! That's true, but it's not an argment for low-income housing programs. If there aren't enough low-wage jobholders in the city to do the work that people are willing to pay for, their wages will go up until there are. I'll be paying more because I was willing to cover the cost of the services I chose to buy, not because some central planner decided that the distribution of housing stock wasn't what he wanted it to be.
9
I have a question regarding the provision that 55% of the proposed units be designated for those making 30% or less of the median income:
Since we're only talking about roughtly 920 units, is it safe to say that the 55% provision is targeted solely at the elderly and disabled?
Since we're only talking about roughtly 920 units, is it safe to say that the 55% provision is targeted solely at the elderly and disabled?
10
If people who cannot afford to raise children would stop having children, we wouldn't have this problem. Reverse Darwinism at its best.
12
@6. In Seattle, the city does NOT build housing. Community based non-profits like Capitol Hill Housing, Catholic Community Services, ArtSpace, Habitat for Humanity, Delridge Neighborhoods Development Association, Inter*Im, LIHI and others do.
The Housing Levy produces places like Broadway Crossing across from Seattle Central and the Pantages on Denny near Broadway.
These groups are dedicated to helping people, not making money so they maintain the buildings in good shape and keep the rent low for the long haul.
The Housing Levy produces places like Broadway Crossing across from Seattle Central and the Pantages on Denny near Broadway.
These groups are dedicated to helping people, not making money so they maintain the buildings in good shape and keep the rent low for the long haul.
13
@12, ok fair enough, but I am pretty sure SHA builds housing(like Yesler Terrace) and they are part of the city.
Again though, how much sense does it make to build these things on prime land. I am not saying I don't support the levy. Hell I don't think 150 million is enough, but I am just wondering about the efficiency of how we are doing it.
Also private landlords have an incentive to keep their places up to. Saying hey your poor, here's a few thousand to help with rent, might be better.
Again though, how much sense does it make to build these things on prime land. I am not saying I don't support the levy. Hell I don't think 150 million is enough, but I am just wondering about the efficiency of how we are doing it.
Also private landlords have an incentive to keep their places up to. Saying hey your poor, here's a few thousand to help with rent, might be better.
14
Funding for first-time homeownership is actually super important. Homeownership is a release valve-- when lower income people can buy a home, they leave an affordable apartment open for a family that can't afford homeownership yet.
In that sense, investing in homeownership actually gives you two homes for the price of one. It's a good deal.
In that sense, investing in homeownership actually gives you two homes for the price of one. It's a good deal.
15
@13 SHA is a "public entity" but they are not part of the city. Seattle appoints SHA's board of commissioners, but the city has absolutely zero control over what SHA does or how it works or how they spend their money. The only time city money touches SHA is if SHA applies to receive housing levy money (through the city's Office of Housing) and competes for that funding with other developers, like the ones Anna Markee listed.
16
Levy funds are integral to creating the housing that keeps low-income working people in the City, close to their jobs and transit opportunities. Capitol Hill Housing (CHHIP) has several projects in the works in Seattle that will access these funds to create units that are permanently affordable to those making between 0 and 60% of area median income (that's about $35k max for one person). These projects also contribute to neighborhood revitalization by transforming underutilized and/or vacant land into vibrant attractive buildings and by creating working family wage jobs in the construction industry. CHH has one project planned for the corner of 12th Avenue and E Jefferson in the Central Area for workforce housing (affordable to those making between 50-60% median income) and another at the East Precinct Parking Lot at 12th and E Pine which will contain Capitol Hill community space and affordable housing.
These community-oriented developments that are permanently affordable, like many others across the City in every neighborhood, will not be built if the Levy does not pass.
The Housing Levy is about putting a roof over everyone's head and about revitalizing neighborhoods so that everyone has access to decent, safe, affordable housing.
These community-oriented developments that are permanently affordable, like many others across the City in every neighborhood, will not be built if the Levy does not pass.
The Housing Levy is about putting a roof over everyone's head and about revitalizing neighborhoods so that everyone has access to decent, safe, affordable housing.
17
One tangible benefit that doesn't always come up is job creation/sustainment, not only with the building of the project, but the maintenance and management of the property in the long term.
20
in a city with a lot of resources, read - people with money, how is we cannot take care of those who serve us coffee, drive our busses among a variety of other things? these people make seattle vital and they are an integral part of society! this housing levy is one angle that has to happen...together we can do this.
21
um, so now we should support the people who serve us coffee and drive our busses? maybe they should get their shit together and get jobs that pay a living wage if they are having so much trouble paying rent... or stop living beyond their means... or move to some where they can afford.
22
i've lived in a few places that were extremely unaffordable for the average joe (NYC for one) and it honestly feels yucky. all the white rich people live in manhattan and the farther out you go, the more segregated and run-down it gets (and less white). i don't want seattle to be like this!
23
It's hard to vote ok on this when you might be unemployed in a year. That plus the property taxes on my middle class home are already over $400 a month.
24
Are you kidding? No, they don't.
First, up until recently, rents had been going up 14 percent a year. You think the city constantly having to increase rent subsidies by 14 percent/year is efficient?
Second, there are documented cases in other cities of landlords renting shithole apartments to subsidized renters and doing nothing to maintain those properties.
Third, do you even rent? Because based on my experience and the experiences of my friends and coworkers, your supposition that landlords give a fuck about maintaining their properties is laughable. They'll maintain their properties as much as the law tells them to (and that's not much) and frequently they don't even do that.
Also private landlords have an incentive to keep their places up to. Saying hey your poor, here's a few thousand to help with rent, might be better.
Are you kidding? No, they don't.
First, up until recently, rents had been going up 14 percent a year. You think the city constantly having to increase rent subsidies by 14 percent/year is efficient?
Second, there are documented cases in other cities of landlords renting shithole apartments to subsidized renters and doing nothing to maintain those properties.
Third, do you even rent? Because based on my experience and the experiences of my friends and coworkers, your supposition that landlords give a fuck about maintaining their properties is laughable. They'll maintain their properties as much as the law tells them to (and that's not much) and frequently they don't even do that.
25
@24,
Saying rents will continue to go up at that rate is like saying housing would continue to go up at 20% a year. Market forces work in rents to and unsustainable increases just that.
Sure there are problems in places. There are problems with non-profit housing in many places too. Good regulation and oversight is essential in both.
And the notion that all landlords don't care about keeping their places up is silly. I've rented and I've known many people who have rented perfectly nice places. Some landlords don't but then some non-profit places are pretty shitty too.
I would just like to see some actual research on what works better and what serves the most people for the lowest cost.
Saying rents will continue to go up at that rate is like saying housing would continue to go up at 20% a year. Market forces work in rents to and unsustainable increases just that.
Sure there are problems in places. There are problems with non-profit housing in many places too. Good regulation and oversight is essential in both.
And the notion that all landlords don't care about keeping their places up is silly. I've rented and I've known many people who have rented perfectly nice places. Some landlords don't but then some non-profit places are pretty shitty too.
I would just like to see some actual research on what works better and what serves the most people for the lowest cost.
26
@25,
Your dismissing the levy out of hand because of the per-person cost sure doesn't support your goodwill. It costs $50k per person because the initial cost is high. Also, oversight and bureaucracy to make sure landlords aren't taking advantage of their tenants and the government aren't cheap. That will easily raise costs well above a "few thousand" per person.
The wisdom of the market is beside the point. If rents start increasing more than 10 percent/year again and all affordable units are subsidized, rather than owned by affordable housing organizations, the government will either have to raise taxes to keep up (not a popular proposition) or cut back on affordable units and make a bunch of people homeless.
Lastly, your notion that these people would be better off in cheaper locales is really, really shitty, frankly. How are disabled or elderly people supposed to get to the doctor's office or to access services if they're located in the middle of nowhere? Placing affordable housing throughout the city is smart, period.
Your dismissing the levy out of hand because of the per-person cost sure doesn't support your goodwill. It costs $50k per person because the initial cost is high. Also, oversight and bureaucracy to make sure landlords aren't taking advantage of their tenants and the government aren't cheap. That will easily raise costs well above a "few thousand" per person.
The wisdom of the market is beside the point. If rents start increasing more than 10 percent/year again and all affordable units are subsidized, rather than owned by affordable housing organizations, the government will either have to raise taxes to keep up (not a popular proposition) or cut back on affordable units and make a bunch of people homeless.
Lastly, your notion that these people would be better off in cheaper locales is really, really shitty, frankly. How are disabled or elderly people supposed to get to the doctor's office or to access services if they're located in the middle of nowhere? Placing affordable housing throughout the city is smart, period.
27
@26 I am not dismissing the levy. I fully plan on voting for it. Hell, like I said above, I don't think its enough and would support more even though its not exactly like I'm rolling in money as it is.
And yes the danger of rapid rent increases is a risk, but if it means more people served then it might be worth it. The end goal is to get the most people into affordable quality housing possible.
I never said the middle of nowhere I said by the light rail stations in Rainier Valley for example. A place with lots of stores, jobs, services, ect, where many people manage to live just fine. For stuff further away I would imagine they would ride the train or take advantage of Metro's Access service like they do now as even in the city they are likely a mile or two away for at least something they need.
Sure ideally everyone lives right by everything they need, but if its the difference between being able to build 500 units downtown or 1500 by the Othello Street station, I am going to go with the 1500 as that is a thousand more families with a place to live. Yesler Terrace for example(I only keep bringing it up as I used to walk by it every day) is not very dense and does not make great use of the land (it was built in the 40's). If that could be sold and as part of the deal we get two or three times the housing if not more, located on a light rail line I think everyone wins. Especially if the housing for low income people is built along with market rate housing, retail, commercial, ect.
And yes the danger of rapid rent increases is a risk, but if it means more people served then it might be worth it. The end goal is to get the most people into affordable quality housing possible.
I never said the middle of nowhere I said by the light rail stations in Rainier Valley for example. A place with lots of stores, jobs, services, ect, where many people manage to live just fine. For stuff further away I would imagine they would ride the train or take advantage of Metro's Access service like they do now as even in the city they are likely a mile or two away for at least something they need.
Sure ideally everyone lives right by everything they need, but if its the difference between being able to build 500 units downtown or 1500 by the Othello Street station, I am going to go with the 1500 as that is a thousand more families with a place to live. Yesler Terrace for example(I only keep bringing it up as I used to walk by it every day) is not very dense and does not make great use of the land (it was built in the 40's). If that could be sold and as part of the deal we get two or three times the housing if not more, located on a light rail line I think everyone wins. Especially if the housing for low income people is built along with market rate housing, retail, commercial, ect.
29
@5: "By including homebuyer assistance in the levy, we can address the generations of inequity in society and help level the playing field for everyone."
Drop, meet bucket. This kind of feel-good explanation for subsidizing people's speculation in the housing market doesn't wash. If you want to promote racial justice, you'd get more bang for your buck to build more affordable rental housing for people of color who would otherwise be further displaced out of the city.
@sgiffy: Yesler Terrace may be "prime land" now, but it was a predominantly Japanese American neighborhood in the 1930s, hit hard by the depression, with a lot of dilapidated mansions that were serving as brothels. SHA kicked the Japanese off the land, prevented most from moving back, and built what was at the time considered model, well-designed, racially integrated affordable housing rather than shoddy, segregated towers of despair. At that time, Seattle was mainly a working class city, and views of the water and proximity to downtown were not seen as the exclusive province of the wealthy.
As an aside, do I understand correctly that Nickels is saying that there's been a 61% increase in the cost of construction in the last 7 years? That sounds fishy.
Drop, meet bucket. This kind of feel-good explanation for subsidizing people's speculation in the housing market doesn't wash. If you want to promote racial justice, you'd get more bang for your buck to build more affordable rental housing for people of color who would otherwise be further displaced out of the city.
@sgiffy: Yesler Terrace may be "prime land" now, but it was a predominantly Japanese American neighborhood in the 1930s, hit hard by the depression, with a lot of dilapidated mansions that were serving as brothels. SHA kicked the Japanese off the land, prevented most from moving back, and built what was at the time considered model, well-designed, racially integrated affordable housing rather than shoddy, segregated towers of despair. At that time, Seattle was mainly a working class city, and views of the water and proximity to downtown were not seen as the exclusive province of the wealthy.
As an aside, do I understand correctly that Nickels is saying that there's been a 61% increase in the cost of construction in the last 7 years? That sounds fishy.
31
Hell no I'm not voting for it! I no longer trust SHA because of their proposed fiasco to build MARKET RATE HOUSING (sprinkled in with a homeless shelter and low-income housing) IN A PART OF DISCOVERY PARK THAT HAS BEEN VACATED BY THE ARMY. Any part of Discovery Park (or any other park, for that matter) where built infrastructure gets vacated should be RESTORED AS PARK LAND for all people. It is especially OBSCENE for SHA to build SF housing at prices starting at $800. That is a complete, warped distortion of SHA's mission, yet they claim it is "necessary" in order to make this ill-conceived project pencil.
32
Responding to the question what is cheaper--whether rent subsidy vs. building permanently affordable units--money on the demander's side to subsidize rent in a market-rate development vs. money on the supplier side--to build the permanently affordable and rent restricted unit--the State of Washington JLARC Committee studied just this question. And you can read the summary by googling WA State JLARC
Problem is this: which is cheaper in the long run does not address issues of scarcity--plenty of people who get rent subsidies in Seattle TURN THEM BACK! Not able to find a unit on the private market to rent within the rent limits imposed by the rent subsidy program (believe me the rent levels are high, but just now high enough!). So this notion that demand and supply equal out is an economist's dream: we have a shortage of units affordable for working people; the levy as proposed promises to support a range of what I think are good ideas: construction of new units, rehab of dilapidated ones, energy efficiency upgrades, short-term emergency rental assistance for people struck by tragedy/job loss/mishap to avoid losing their apts/homes as they regroup, down payment loan/assistance (45,000 max per household) for families entering home ownership (this money revolves back to the city for relending). While I have experienced this year job loss and my property value has gone up 10 x since I bought I know I'm lucky), I still would pay $7 per month, or about $80 per year to be part of a solution for instability and fears of families trying to get by, work, live close to their jobs and make a healthy life.
Problem is this: which is cheaper in the long run does not address issues of scarcity--plenty of people who get rent subsidies in Seattle TURN THEM BACK! Not able to find a unit on the private market to rent within the rent limits imposed by the rent subsidy program (believe me the rent levels are high, but just now high enough!). So this notion that demand and supply equal out is an economist's dream: we have a shortage of units affordable for working people; the levy as proposed promises to support a range of what I think are good ideas: construction of new units, rehab of dilapidated ones, energy efficiency upgrades, short-term emergency rental assistance for people struck by tragedy/job loss/mishap to avoid losing their apts/homes as they regroup, down payment loan/assistance (45,000 max per household) for families entering home ownership (this money revolves back to the city for relending). While I have experienced this year job loss and my property value has gone up 10 x since I bought I know I'm lucky), I still would pay $7 per month, or about $80 per year to be part of a solution for instability and fears of families trying to get by, work, live close to their jobs and make a healthy life.
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