Conlin on the MoneyLast week Seattle Councilmemer Richard Conlin said something that made perfect sense to me:

We may not be as successful if we devote our resources into the new housing in a very hot neighborhood in producing as much help for people who need affordable housing as if we focus our resources on, say, along the light rail line in Rainier Valley, where there is easy access to some of those jobs and where there are lots of great communities, such that can be built up there. It is a matter not so much about, say, everything there and not here, but what is where is the most effective way in which to deploy the resources that you might be able to have, which we know we can’t create all the affordable housing that we would like to have. The government efforts are not possible to do that. So we have to figure out where our resources are most effective.

Councilmember Conlin was talking about South Lake Union when he was referring to a “hot neighborhood.”

Here’s the reaction to Conlin’s comments from a couple of advocates quoted by Dominic Holden in the SLOG:

Philippa Nye, of Ally Community Development, was the first to speak at a comment period, denouncing the idea: “Having everyone commute from Rainier Valley or Rainier Beach feels like housing segregation to me.

She was hardly alone—I heard from several people this week. “Having council suggest redlining and segregation is part of Seattle’s future makes my stomach hurt,” says Rebecca Saldaña, a program director of the housing advocacy nonprofit Puget Sound Sage.

What’s odd is that Saldana’s group Puget Sound Sage produced a report on light rail in the Rainier Valley that said this:

Southeast Seattle neighborhoods should remain majority people of color.

Something seems wrong with Saldana’s reaction.

First of all, I heartily disagree with the Puget Sound Sage report that, not withstanding the bizarre assertion I’ve quoted, treated light rail in the Rainer Valley as an impact, something bad that needs off setting. It’s no such thing. On the contrary light rail is a boon for the Rainer Valley, otherwise why would Puget Sound Sage be demanding to tap in to what they would acknowledge is the economic largess created by it: jobs, customers, and more access to housing near transit.

But let’s say Puget Sound Sage wasn’t wrong about light rail in the Rainer Valley. Let’s say that light rail was making things more expensive there as they assert. Why wouldn’t they want the big taxes the Council is going to charge developers to go to affordable housing in the Rainer Valley, where they say people of color are being priced out, instead of going to support subsidies for people who earn over 60 percent of Area Median Income who want to live in South Lake Union?

The truth is that Puget Sound Sage and their allies are simply wrong on this issue and wrong on light rail. As long as the Council is going to tax new development in South Lake Union (something I’m totally against), why not send those dollars where they can go further, supporting a diverse neighborhood and the organizations that are trying to serve people in those neighborhoods with affordable housing.

I think Richard Conlin is right on as far as this point goes. I don’t think we should tax new housing development in South Lake Union at all; we should be supporting the building of more housing. But as long as we’re going to tax new housing in the name of offsetting the impacts of new housing by subsidizing more housing (talk about bizarre), we should be doing it where it’s cheaper to build and where lower incomes can be served. The added bonus of the Rainer Valley is that the dollars could go even further by leveraging the access to billions of dollars of investment in regional light rail.

52 Replies to “Conlin is Right On the Money”

  1. I understand Conlin’s arguments. But we’re not talking about public resources here with the apodment issue. These are private developers wanting to provide affordable housing for singles because there is a market for them. Why prevent private investment in affordable housing in any multi-family zone? Plus, apodments are nothing more than a modern iteration of the kind of housing that was common when Seattle was a frontier town. The evidence is in the buildings all over Pioneer Square.

    Finally, in many ways apodments in Cap Hill takes some pressure off more affordable neighborhoods like those in the Rainier Valley because it provides affordable space for singles who might move to the valley to find a place to live because there is nowhere else to go.

    1. The economics of housing, particularly for rentals is very dynamic. Adding housing in one area will have an affect on other areas of the city, because renters move around so easily and frequently, at least compared to homeowners. So yes, building more housing in Capital Hill will help to push down prices in the Rainier Valley. The question is: by how much?

  2. Far too many “housing activists” suffer from the same contradictory, incoherent thinking you spotlight here.

    The fact is that in the end there are only two ways to mitigate housing prices:

    1) Let neighborhoods decay into slums through utter lack of investment.
    2) Build more housing.

    One of those two options is vastly better than the other. But in the end a lot of “housing activists” functionally embrace the bad one, not the good one.

    1. Or complaining about “segregation”, which is partially true although it’s de facto segregation along economic lines (which can also be by race or ethnicity), but then complaining about gentrification of said areas because they’re then no longer majority minority.

      Which is it? Is segregation bad or is it actually good? Do we need to keep certain neighborhoods darker? Isn’t that the bad kind of segregation?

      Housing activists in Seattle are incredibly annoying and incoherent.

    2. In my experience, building more housing in a popular city may lead to a temporary stop in the rise of housing prices but ultimately the overall trend is still up. It goes something like this: A lot of people want to move to Seattle. Developers accommodate them by building more housing. Suddenly the housing supply overwhelms demand and prices either stagnate or decline. Developers stop building. Eventually demand whittles down oversupply. Prices start to move back up. Developers resume bldg. Wash, Rinse, Repeat.

      In the meantime, the price of land continues to go up aided and abetted by zoning in a number of different ways. And therein lies the rub.

      Its the land that ultimately makes housing in a popular city expensive. Why? Because unlike housing, there is no real way to build any more land. Owners of the land know that and continue to raise the price of that land even during bad times.

      That makes all this talk about increasing density so that Seattle has more affordable housing a bunch of bull. You want more affordable housing in Seattle, level the Olympics and the Cascades, pave over the Sound into a parking lot and cut down a lot of trees. Then you will be surprised just how affordable housing becomes in Seattle.

      1. You are falling for a very common fallacy, as follows:

        1) Developers built more housing.
        2) Prices still increased.
        3) Therefore, the building caused (or at least failed to mitigate) the increase.

        In actual fact, if the developers were prevented by zoning or process from building any new housing, prices would have gone up vastly faster.

        Yes, when there is huge demand and a fixed amount of land prices are going to go up to a certain extent no matter what. But it’s pretty obvious, once you think about it, that prices will go up less if you use your fixed amount of land for more people.

      2. You are falling for a very common fallacy, as follows:

        1) Developers built more housing.
        2) Prices still increased.
        3) Therefore, the building caused (or at least failed to mitigate) the increase.

        In actual fact, if the developers were prevented by zoning or process from building any new housing, prices would have gone up vastly faster.

        Not a fallacy. The fault doesn’t lie with developers nor the amount of housing they did or did not build. The fault lies with the popularity of a particular location and the finite amount of land occupied by that location.

        And of course zoning has an impact…..and so does the economy, local politics, fashion trends, the amount of the land devoted to non residential uses, etc. Nonetheless, the basic problem still boils down to demand and the amount of land available for development.

        Yes, when there is huge demand and a fixed amount of land prices are going to go up to a certain extent no matter what. But it’s pretty obvious, once you think about it, that prices will go up less if you use your fixed amount of land for more people.

        Manhattan has one of the highest densities in this country. In fact, Manhattan is so dense that if that level of density were applied to the remaining boroughs of NY, you could pretty much fit the population within the borders of NYC. Despite all that density, Manhattan has some of the most expensive housing in the country and the world. Increased density doesn’t lead to more affordable housing…… fact, most of the time, its just the opposite.

      3. keetz4:

        In fact, increased density leads to lower housing prices, all else equal…. and all else is not equal.

        It seems obvious that it is the *attractiveness* of a city which raises housing prices. New York City has remained one of the most attractive cities in the world for over 150 years (at least!) and so it is pretty much impossible to build enough housing to have cheap housing there. If, on the other hand, you regulate the housing supply in New York City the way they do in Martha’s Vineyard (which is also attractive), you will see what really expensive housing looks like.

        In the past, when Detroit was growing, increased density in Detroit did ameliorate the rise in housing prices. Then Detroit lost population, which caused reduced density.

        Seattle is unlikely to be as permanently popular as New York. If Seattle builds a lot of housing, it will ameliorate the rising prices of housing in Seattle.

        Of course, if Seattle does things to make itself more popular, that will keep raising the housing prices. It is quite easy to get affordable housing in cities nobody wants to live in. This would be *one* option for increasing affordable housing, but it’s a stupid one.

        In short, keetz, it is a fallacy and you did fall for it.

  3. It seems very bizarre to not tax new development. By saying they shouldn’t be taxed, you’re making developers out to be some poor, hard working, strapped for cash individuals, when in fact most of them are very large, very profitable corporations that build and dash, with little care or considerations for the neighborhoods or cities they are profiting off of.

    It seems very fair to me, especially in quickly growing places like SLU, Ballard, Capitol Hill, etc, to levy a tax on development. Those markets are so desirable by both builders and homeowners, that developers won’t even blink at the tax.

    1. I have to agree somewhat with RapidRider. Impact fees on development are often how we pave the streets and build the sidewalks to serve new development. The missing sidewalks north of 85th are one of the unfortunate side effects when we don’t charge these fees. It shouldn’t be on all the rest of taxpayers to build sidewalks and streets for new development.

      All new housing, including totally desirable housing, also means more seats to fill on transit. If everyone but the developer is paying the cost of providing that additional transit investment, then it is no wonder why the rest of the taxpayers would resist. Our development fees and taxes have to be structured in a way that makes it financially advantageous for the rest of the electorate to want new inside-the-city development to happen.

      But I’m also quite supportive of trading development rights inside the city for setting aside land not to be developed forming a wall against sprawl around the urban growth boundary. Many voters will go for that, I believe. But I haven’t heard such a development rights trade being on the table for SLU.

      1. There is a serious distinction between Crown Hill and impact fees in established neighborhoods. At the time Crown Hill was built out, it was suburban sprawl when compared to the rest of the existing development. What Crown Hill is now is a different beast b/c all of the northward development that occured after. The city of Seattle has nowhere to build a neighborhood like Crown Hill at this time unless we go Dutch in Elliot Bay.

        The question now is whether the “impact fees” are properly calibrated to affect the mitigation of direct impacts of new development. If I replace a parking lot with a new 12 story building, I have not physically displaced existing housing, but I may have caused other effects (needing additional water/sewer/comm infrastructure). To the extent that the city has to allocate resources to provide those upgrades for my development, there is an argument that I should have to pay a fee to reimburse the city for its outlay, else its a subsidy.

        What Licata and others want to do with incentive zoning is to ascribe the impact of displacement of workforce housing with market rate housing in “hot” neighborhoods to all new development regardless of its actual effect. That’s using a hammer when a scalpel is what’s needed, IMO.

      2. I actually like the idea of having to mitigate the tearing down of existing “workforce housing”, in the sense that those displaced should get ample financial assistance to move to similarly-priced housing (although not necessarily on-site, as John Fox keeps ridiculously proposing).

        When my apartment in Lake City was converted to condos, I got a nice fat check from the owner in exchange for my eviction. I also got first right of refusal on buying my unit, but the price was far too high for me, and I wasn’t ready to be tied down to living there. I believe I have John Fox, among others, to thank for those two opportunities. So, though I beat up on some of your policy proposals, John, thanks for the help your efforts gave me when I was forced out of my apartment!

  4. I’d like some clarification: Is the council proposing a special tax on new construction, or is it suggesting a property tax abatement (such as the sports stadia get, meaning that the rest of the tax base gets stuck paying for the transportation, utility, and other infrastructure to support the stadia)?

    1. As I understand it, the council is proposing a tit for tat. They will approve the rezone, but will make developers pay additional fees to take advantage of the new height limits. So, the fee on the delta would be higher than the fee for any development that keeps to the older zoning heights. Publicola did a breakdown yesterday.

      1. Higher impact fees for taller buildings make perfect sense to me. And I do support having the taller buildings.

        Thanks, Ryan!

      2. Brent, I see your point, but my issue is that the developer (or eventual owner of the building) will already pay higher taxes for taller buildings, on account of those buildings being more valuable. This is an additional tax on top of general property taxes. So there’s that.

        Moreover, if Licata’s plan goes forward, you risk the cost of higher buildings (ie: the taxes/fees paid on the delta) being higher than the expected ROI for those units in a reasonable time frame. Then, the developer has no business reason to build higher and will keep to the existing limits. Thus, the rezone is ineffective in providing what it should, which is more units in the same area.

        The way Licata sees it, as I understand, is that the rezone is a “gift” to developers, and that we should instead make it more like a “transaction.” However, that thinking starts from the principle that heights in in-city neigborhoods should exclusively controlled by the government. That thinking, from a property rights perspective, is slightly troubling.

      3. Tactically, I disagree. Vulcan will pay the fee. They’ve got the money. If it is too high, they’ll negotiated the fee down rather than build smaller. The taller buildings will be built, and the taxpayers will get a slightly better deal in the process.

      4. As I understand it, the issue is like this:

        1. City upzones South Lake Union.
        2. City ordinance allows even higher density IF the developer provides public benefits: either 5% of the residential units are affordable, or the developer pays the City a fee to build affordable housing elsewhere.

        This fee is in excess of any sales or property taxes paid. The fee is only required if a developer wants to exceed the new SLU zoning limits.

      5. “if Licata’s plan goes forward, you risk the cost of higher buildings (ie: the taxes/fees paid on the delta) being higher than the expected ROI for those units in a reasonable time frame. Then, the developer has no business reason to build higher and will keep to the existing limits.”

        Where have developers recently not built to the zoning limit, and not taken full advantage of pay-for-additional-height options? Why can’t it work like an auction? Start with the maximum height and maximum cost, and if no bids come in, lower the cost until they do.

        Impact fees are not just about building roads and sidewalks and water pipes (which the city does well), but about everything else that an urban village needs to be self-contained and have good transit (schools, supermarkets, transit, etc), especially those that private investors will not build on their own (which Vancouver is doing well but are still missing in Belltown).

      6. Vulcan could even consider building a community or senior activity center on the ground floor of one of their buildings, right next to the employee child care facility. Impact fees do good things, even if they are tools to get developers to do some of the things themselves.

      7. “However, that thinking starts from the principle that heights in in-city neigborhoods should exclusively controlled by the government. That thinking, from a property rights perspective, is slightly troubling.”

        Property is a creation of government, so I have no problem with this principle. Of *course* heights in the city should be exclusively controlled by the government.

        What I have a problem with is the idea that “high is bad”, and that therefore developers should have to pay to build tall. Shouldn’t the government be charging extra fees for the wasteful, socially unproductive use of Seattle lots — for instance, a fee for any lot which only one story high, and a larger fee for a lot which has zero height (a surface parking lot)?

        I assume the Space Needle would have horrified the current height-averse city council, who would have charged the developers huge fees for this massive imposition on their beautiful low-rise city. WHAT THE HELL?

      8. (In short, there’s a lot to be said for higher impact fees for SHORTER buildings, and the highest fees for completely flat surface parking lots.)

      9. Nathaneal, that’s idiotic. Impact fees are intended to mitigate for the effects of added infrastucture needed to support intensive uses. The parking lot doesn’t contribute additional traffic, nor does it need more water or sanitary sewer service. It might increase impermeable area, so an impact fee on storm water service might be appropriate.

        It’s the land value that will one day cause the property to be developed to a higher use. If property taxes go up because of increased land value, use as a parking lot may become unviable. If so, the property will either be put on the market or it will be developed into something with a positive return.

      10. However, that thinking starts from the principle that heights in in-city neigborhoods should exclusively controlled by the government. That thinking, from a property rights perspective, is slightly troubling.

        Hard to make sense of this as anything but opposition to any regulations on property whatsoever–no zoning at all. That position has a certain abstract philosophical coherence, but when we start to unpack the concrete reality of life in cities, it’s obviously a principled view on property rights that is not capable of governing city life. I do agree the proper amount of zoning restrictions and regulations should be closer to that–height limits should be higher and less restrictive in most of the city–but the notion that we could govern the city without any rules that restrict freedom to do what you wish on your property–is pretty clearly a non-starter.

      11. The parking lot doesn’t contribute additional traffic

        Of course it does. Give people more places to park, drive the cost of parking down by creating more availability, more people drive, more traffic. Read your Shroup!

  5. So Puget Sound Sage recommends continued segregation and poverty for people of color? Redlining in the name of social equality.

    1. The cherry-picked quotes paint a picture that PSS is totally confused. I’d rather let them post their position here directly, if we want to debate whatever the heck it is they are really asking for.

      1. And since Roger, who lobbies for some developers, got space here, I would consider giving PSS equal space to be good, mature journalism.

      2. Honestly? PSS probably IS totally confused. I’ve found that to be quite common with “social justice” groups — they often haven’t thought things through and have ended up with contradictory positions. There are exceptions of course, but your average group is not run by clear-headed people. This is a general principle of all groups of people, of course — most groups of any sort are run by people who are not clear-headed, period.

  6. While some of Rebecca Saldana’s words may come off as histrionic, the way I read it, she seems to agree with most of us on apodments: Why now allow them to be built wherever someone wants to build them (that is, inside the city, since we are talking about Seattle policy) and where people want to live in them? Pushing all affordable housing to one corner of town could rightly be perceived as segregation (though it is sheer fantasy that that will be the effect, given that Link is expanding north).

    Let’s not take sides between developers — those who own big tracks of land in SLU, and smaller-time developers out in the ‘hoods. We have nothing to gain from getting developers to lobby against each others’ developments.

  7. My fear of pushing all low income housing into one area is that eventually the area is overlooked by government ( there are no tax dollars or political money to be had there ) or business ( why put a store there? No one has any money ).

    Also, right or wrong, the Rainier Valley looks at itself as always being the redheaded step child of the city. Need to build a tunnel for light rail in the North End? Build it above ground in Rainer Valley and using the savings, tunnel along the freeway to Northgate. Lets not put at risk housing in Ballard, lets clump it all up in Columbia City.

    1. Yes. Diversity is key. Creating monocultures and concentrating poverty is a mistake and it winds up burdening the systems tremendously including public safety, schools, and more.

      1. It is actually a documented social-science fact that you get better results if you mix subsidized housing units with market-rate units. One can probably generalize to say that it’s better to have poor people mixed in your middle class people, as neighbors.

        I would go so far as to say that it’s better to have your rich people mixed in, too. Otherwise they can get extremely out-of-touch and start doing stupid crazy things, and they have enough money to cause a lot of trouble by doing so. If they live next door to ordinary people they are less likely to get ridiculously out of touch.

    2. Also, why don’t companies like Google and Microsoft take advantage of all that available south end cheap land in places like RV and place some campus buildings in them–a little economic diversity could help those communities.

  8. It’s valuable to have mixed-income neighborhoods. But every low-income home we build in high-land-value neighborhoods is far more expensive than in low-land-value neighborhoods, which means we build fewer units. What’s more important, housing more low-income people? Or creating mixed income neighborhoods?

    The right answer is probably a mixture of both.

    Though I haven’t heard anyone suggest aPodments in SLU. Mixed income with no subsidy required. aPodment highrise anyone?

  9. If you read Puget Sound Sage’s report it’s much more nuanced. Roger, I agree with you on many issues but you are cheapening the public debate in this case. We are becoming less segregated by race and more segregated by income. Race and income are clearly still linked. Many populations were redlined into the CD, ID and Southeast neighborhoods decades ago, and people of color have migrated further south as those neighborhoods became more desirable. We don’t have good ways to measure whether people are being priced out of the Rainier Valley over a short time period, so race becomes a way to measure whether communities are able to remain intact.

    You will still have majority POC in Rainier Valley unless there is a more dramatic increase in housing supply than is likely to occur, or people are priced out to neighborhoods that don’t allow them to take advantage of light rail.

    We should be able to agree that some level of housing subsidy, some provision of workforce housing at market rate should be available to people in the center city and neighborhoods that have good amenities. We need to find the right balance between giving disadvantaged populations access to neighborhoods with better schools, more jobs, etc. and allowing communities of immigrants, for example, to continue accessing the businesses and institutions that have helped them make homes in places like the Rainier Valley.

    We need more affordable housing stock both in SLU and in station areas throughout the city, and it’s unfortunate that this is where you are taking the debate.

    1. C, Martin had a great review of the report a while back:

      He pointed out his concern over Sage’s usage of racial percentages and not just hard numbers. So even though the number of POC INCREASED in the RV because whites increased more, all of sudden whites are pushing out POC and this is a cause for concern.

      I find their methodology distasteful (makes me think they want some kind of quota system) and little more than scaremongering. I think Roger is right to call them out for it.

      1. I agree that their report could use a messaging makeover and with Martin’s more nuanced commentary. Not Roger’s.

        In particular I think Martin nailed these points.

        “Through a variety of mechanisms, gentrification is likely to lead to displacement of the poor into South King County, with various moral, social, and environmental consequences.
        The set of policies usually grouped under “affordable housing” must expand to more directly consider the obstacles to disadvantaged people remaining in place.”

        Do you think they actually want a quota system or do you think the language they used is just a turnoff for a lot of people?

        Behind the % of racial and ethnic groups in the area there’s the reality that if the composition of a community changes really rapidly, we should question whether we are creating long-term stability/resilience/net gain for the people who we would like to benefit from our investment in light rail.

      2. And note that the most inexpensive places are not near the 150 or A or 101 or 120; they’re in areas with hourly or no transit. We tell people not to live in isolated locations if they want transit, but that conflicts with where the affordable rents are.

      3. Grrr. In short, I think the only way to deal with poor people being “priced out” is to increase the level of equality in the society, with a redistributive income tax or something similar.

        All this other stuff is hopeless. As long as housing is rented or sold by “landowners”, the most popular areas will be selectively taken by the richest people. The solution of nationalizing all housing actually did help in the USSR, but it degenerated as the housing quickly got allocated by political favoritism.

        As long as there are rich and poor, and as long as we have anything approximating money-based allocation of housing, there is no way to prevent “rich neighborhoods” and “poor neighborhoods” from forming. So change the picture: make the rich and the poor both middle-class and you have a chance.

  10. I’ve probably missed it, but is there a more specific number for the sort of monthly rent or individual subsities they’re talking about here? I see the phrase “60 percent of Area Median Income”. (Specifically for the South Lake Union area). But I’m not sure if that means that means that there should be some unit rent level would be about $3000 a month (the full 60%, I think), or than some units should be retricted to a percentage of that amount. Or if there’d be steady funding that would pay the difference between the resident’s 60% and whatever the market rate lowest unit rental price is.

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