By Meghan Hall
The City of Seattle has experienced profound growth over the past decade, forcing housing prices to skyrocket as long-time Seattle residents must increasingly compete with newcomers for housing. Since 2015, the city officials have been working on mandatory housing affordability rezones throughout the city, which would up-zone Seattle’s designated urban villages while simultaneously require developers to build on-site affordable housing. It is part of a long-term goal put in place by the City of Seattle to build 6,000 affordable housing units over the next decade. The plans hit a snag last year, however, when a group of Seattle residents challenged the adequacy of the Final Environmental Impact (FEIS) for the proposal. The lawsuit delayed the legislative process for up to a year, until the City of Seattle Hearing Examiner, Ryan Vancil, ruled last week that the city’s environmental analysis was sound.
“This is a program that has worked well in other parts of Seattle as well as around the country,” explained Rob Johnson, the chair of the Seattle City Council’s Planning, Land Use and Zoning Committee. “Implementation of this program has been a long time coming, and the City believes that like many other jurisdictions around the region, it will be a critical thing for us as we continue to find more funding for affordable housing.”
The City’s Mandatory Affordable Housing (MHA) proposal would allow for developers to construct taller buildings in the City’s urban villages—designated communities in Seattle where the City directs public investment in community assets to accommodate future job and population growth—while agreeing to contribute to the City’s affordable housing solutions. According to the City of Seattle, more than 80 percent of its new homes have been built within urban villages over the past two years. The goal of the MHA is to ensure the creation of affordable housing in close proximity to those neighborhoods, which are also hubs for major transit, retailers and entertainment.
When proposing a project, developers can either choose to “perform,” and include on-site affordable housing within their project, or pay into a housing fund managed by the City. According to Johnson, the changes in zoning will apply to 27 of Seattle’s neighborhoods, and the up-zoning will be modest. In most cases, the building heights will only rise about one story.
Six of Seattle’s neighborhoods—such as the U District, downtown and the Chinatown – International District—already have zoning changes in place, since they had already started or nearly concluded the EIS process individually. Johnson said the legislation is designed to get roughly half of developers to include affordable housing in their project plans.
“The program is designed to try to calibrate the developer contribution to result in about 50 percent of developers choosing to do what we call ‘perform,’ i.e., build affordable housing on-site versus pay a fee,” said Johnson. “There are benefits to both of those options.”
When developers choose to include affordable housing in their developments, the result is more mixed-income communities; when developers pay the fee, the City can leverage federal funds to create three times as many affordable housing units, said Johnson. The money accrued by the City is then given to affordable housing developers. According to the City, projects that have already gone through the mandatory affordable housing process have contributed roughly $13 million in fees, although Johnson said it is too early to tell how many units will be funded through payment or performance.
What Johnson did know, however, was that the lawsuit challenging the FEIS has cost the City not just time, but close to $90 million worth of funding for affordable housing, or roughly 720 units.
“What is unfortunate about the delay is that we are at the tail end of a major development cycle, and that delay of implementation has resulted in a delay of us being able to convince developers to opt into the program or to require more developers to participate,” said Johnson. “We are a region that is rapidly diversifying but is not constructing income-restricted affordable housing at nearly the rate that we need to.”
Johnson estimated that the Seattle region was constructing roughly 2,500 units of affordable housing annually but stated that number needed to be closer to 8,800 units in order to keep up with current demand. The City will still need to wrap up some final technical work regarding historic resources before it can formally proceed with the MHA, but Johnson is hopeful that the legislation will be adopted by the first quarter of 2019 after more than 300 public outreach and community design workshops to refine the plans.
“As one of the largest generators of funding for affordable housing, we need to step up and do our part to contribute to those goals, and [the MHA] is one of the critical ways in which to do so,” said Johnson. “A lot of work has gone into this and it is the City’s expectation that the document produced will be well-informed by public dialogue.”
