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Monday, May 6, 2013

The City Council's SLU Rezone Actually Provides Less Affordable Housing Than the Mayor's

Posted by on Mon, May 6, 2013 at 12:10 PM

This guest post is by Sharon H. Lee, executive director of the Low Income Housing Institute.

Today, the Seattle City Council is poised to approve the South Lake Union rezone legislation.

Council Member Tim Burgess called this proposal in his recent newsletter "a sensible solution that brings affordable workforce housing to the City’s hottest real estate market far above the level called for in the Mayor’s original proposal." But I was curious about how the council’s proposal really stacked up to Mayor Mike McGinn's original legislation, so I inquired with the city's Department of Planning and Development. Marshall Foster, the City’s Planning Director, confirmed my suspicion. The mayor’s proposed legislation, including taller buildings near Lake Union and the Block 59 proposal, would have generated over $2 million more in funding for affordable housing than the scheme council is now looking to approve.

How did this happen?

Council Members Burgess, Nick Licata, and Mike O’Brien retooled the mayor's proposal, stating that their adjustments would create more affordable housing for those in need. To do this, the council is increasing the fees charged as a part of the incentive zoning program in SLU from $15.15 to $21.68 per square foot for residential.

At the same time, the council has also voted to decrease the height of buildings near South Lake Union Park to protect views. This will also substantially reduce the public benefits that would have been provided by developers in exchange for that additional height.

Building to the full 240 feet proposed by Mayor McGinn would have required developers to provide extraordinary public benefits. In fact, Vulcan Real Estate had proposed a deal that would have provided land for development of affordable housing within SLU. The parcel, known as Block 59, is located near Mercer Street and Dexter Avenue North. The parcel encompasses property owned by Vulcan Real Estate, the city and the state. More than 15 nonprofits envision that Block 59 could support 400 units of mixed-income housing, along with much needed affordable childcare and a job training center. The Block 59 deal alone would have provided $10-15 million in value for affordable housing.

But some members of council were suspicious of this unique deal. They were also under pressure to reduce building heights in the rezone. So the council has a made a choice. They lowered heights and reduced the public benefits that could have otherwise been created to provide housing for low income families.

The council also proposed increasing the fees charged as a part of the incentive zoning program in SLU. By increasing incentive zoning fees, council members claim they will add resources for affordable housing. However, there are two problems with this argument: One, the council attempted to set the fee at a level that would encourage “affordable” units on-site rather than pay into the city’s affordable housing account. This means developers will create units for households with incomes between $70,400 to $86,700, or those earning 80 percent to 100 percent of area median income. These units are not really affordable. If instead these funds go into the city’s affordable housing account, the dollars would be granted to nonprofit housing providers that create units for families earning less than $52,800, or 60 percent of area median income.

Secondly, the higher fees are pushing many developers to reconsider their development plans. There are at least five projects in SLU that are going ahead with plans to build at current zoning. This will mean squat buildings that are roughly seven stories in height. It will also mean that these projects will provide very few public benefits since the developers are forgoing bonus programs and therefor will not be required to contribute to affordable housing or other community needs. For these five projects alone, the city will forgo roughly $13 million in funds for affordable housing that could have been provided by developers if they had taken advantage of the full heights allowed under the rezone.

The city council also failed to take any action to preserve existing low income housing in SLU.

It is unfortunate that the city council, after a decade of public process, prioritized politics and protecting the views of the few above supporting affordable housing.

 

Comments (14) RSS

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1
At last Thursday's debate Harrell asked "how could anyone support McGinn's SLU proposal and look a housing advocate in the face?" Looks to me that Harrell didn't actually ask the housing advocates at all, and at least one of the main ones supported McGinn's plan.
Posted by junipero on May 6, 2013 at 12:32 PM · Report this
2
Other folks have been trying to tell Council this for months:

http://citytank.org/2013/03/04/more-on-w…

"Further fees beyond those proposed or creating mandatory inclusionary housing are likely to jeopardize the financial viability of any tower project, which effectively means most developments will only build to the current “bread-loaf” base capacity. No affordable housing will be the outcome."
Posted by dan bertolet on May 6, 2013 at 12:39 PM · Report this
Storbaker 3
Council's proposal may be much worse than the Mayor's from an affordable housing standpoint, but it did allow Harrell and Burgess to grab some headlines so I guess it's a win for them. They are both rich and perhaps a bit out of touch or lack compassion.
Posted by Storbaker on May 6, 2013 at 1:13 PM · Report this
mrbombit 4
'One, the council attempted to set the fee at a level that would encourage “affordable” units on-site rather than pay into the city’s affordable housing account."

So the truth comes out. Sharon only wants affordable housing that is done by her organization. Selfish, just plain selfish.
Posted by mrbombit on May 6, 2013 at 1:27 PM · Report this
5
Sharon makes some legitimate points, but she doesn't work in the fact that the Council replaced (in another area) nearly all of the development capacity lost with lower heights to preserve public views on the Mercer blocks.

The statement that five projects in SLU are going ahead with plans to build at current zoning says more about the short-sightedness of those developers than it says about the legislation pursued by the Council.
Posted by zilch on May 6, 2013 at 2:26 PM · Report this
6
@4, "the truth comes out" -- affordable housing advocate would like affordable housing to go through the city's (read: the council's, etc) established methods. How "selfish", eh?
Posted by grkle on May 6, 2013 at 2:38 PM · Report this
7
Ugh, @5 really? As someone who walks everywhere in Central Seattle, the public views argument seems so completely stupid to me. It's totally overblown. Clearly it's a factor in this debate, but man what a paper tiger.
Posted by grkle on May 6, 2013 at 2:41 PM · Report this
8
What a simplistic analysis; the writer - along with McGinn - will accept more development in order to get more affordable housing. The Council, on the other hand, has mandated a higher percentage of affordable housing in (somewhat) constrained development.
Posted by Coconut Bob on May 6, 2013 at 3:03 PM · Report this
9
grkle - I'm not saying the public views argument was a good reason to reduce the heights on Mercer, I'm saying that Sharon doesn't figure into her analysis that the Council increased heights more than the Mayor proposed in another area and thus re-balanced the square footage with development potential.
Posted by zilch on May 6, 2013 at 3:04 PM · Report this
Ryan in the sky 10
But, block 59 is off the table. The council took it off the table due to the appearance of collusion. You can't compare one proposal with block 59, no longer an option, to a proposal without.

The council is free to propose non-Vulcan related uses for Block 59 with regard to affordable housing.
Posted by Ryan in the sky on May 6, 2013 at 7:30 PM · Report this
11
How affordable is the mayor's housing, anyway, hyuk hyuk. If I knew more about grammar, I could give you the technical name for the sloppy ambiguity in this headline. I bet someone on the staranger staff knows it. Ask around.
Posted by beef rallard on May 6, 2013 at 8:40 PM · Report this
12
The Seattle City Council’s decision on South Lake Union’s redevelopment is a positive step to ensure that this dynamic neighborhood welcomes residents across the full range of income levels, including those working in SLU for low or moderate wages. The Housing Development Consortium of Seattle - King County (HDC) appreciates this action. We will work with City leadership and stakeholders on a citywide plan that uses the SLU outcome as a starting point towards a policy that helps Seattle remain home to its current residents and welcomes future residents across the economic spectrum.

HDC has not taken any position on building heights in SLU or on the early offer of the Block 59 property for affordable housing production outside of incentive zoning requirements. We support neighborhoods in making equitable accommodation to the density needs of a growing city which include an increased supply of affordable housing of all types. We also support community-minded businesses in contributing to the social good and encourage the owners of Block 59 to work with our members and others to determine if there is a financially viable opportunity at that particular site.

Harry Hoffman, Executive Director, Housing Development Consortium of Seattle - King County
Posted by hhoffman on May 7, 2013 at 2:43 PM · Report this
13
The Seattle City Council’s decisionon South Lake Union’s redevelopment is a positive step in the right direction to ensure that this dynamic neighborhood welcomes residents across the full range of income levels, including those working in SLU for low or moderate wages. The Housing Development Consortium of Seattle - King County (HDC) appreciates this action. We are prepared to work with City leadership and all stakeholders on a citywide plan that uses. the SLU outcome as a starting point towards a policy that helps Seattle remain home to all of its current residents and that welcomes future residents across the economic spectrum.

HDC has not taken a formal position on building heights in SLU or on the early offer of the Block 59 property for affordable housing production outside of incentive zoning requirements. We support neighborhoods in making equitable accommodation to the density needs of a growing city which include an increased supply of affordable housing. We also support community-minded businesses in contributing to the social good and would encourage the owners of Block 59 to work with our members and others to determine if there is a financially viable opportunity at that particular site
Posted by hhoffman on May 7, 2013 at 2:49 PM · Report this
14
Please check Ms. Lee's facts. The purpose of incentive zoning is to provide affordable places to live for low-to-moderate income workers - slightly higher incomes than the nonprofit community is able to serve. The shocking "affordable" income levels she cites are for families of four and apply to home-ownership affordability, not rents.

What about the workers who make $37,000 to $45,000 per year (60% to 80% of Area Median Income for an individual)? They make too much to qualify for apartments like those Ms. Lee's organization provides, and cannot afford market rents in South Lake Union and nearby neighborhoods. They have to live far away and commute to jobs in the highly congested SLU traffic... is this what you want for Seattle?
Posted by seattledenizen on May 7, 2013 at 4:31 PM · Report this

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