$15 Minimum Wage Won’t Improve Housing Affordability Without More Housing

Belltown (Wikimedia)

For reasons irrelevant to this blog, I support a higher minimum wage in Seattle and would almost certainly vote for one if given the opportunity. I’m not well-informed about this issue, but basically it would be great if the poorer people among us were able to afford more necessities of modern life.

However, I’m somewhat irritated by the notion that the minimum wage will, in itself, substantially help with the serious problem of housing affordability in Seattle. Although Friend of STB Goldy probably wouldn’t disagree with any of the policy content I describe below, most people would probably construe what he writes in The Stranger the wrong way:

The fact is there’s nothing radical about suggesting that the minimum wage should be higher in Seattle than it is in much of the rest of the state. Nearly everything is more expensive in Seattle—housing especially—and minimum wage workers here simply need higher pay than their counterparts in, say, Yakima or Ferry counties.

Goldy also shares some cost-of-living data in another article.

If Seattle decided to make bus passes affordable to everyone by giving all residents $90 a month to buy one, then it would succeed: there are no practical limits on how many passes Metro can issue, and the price is fixed by legal fiat. At the opposite extreme, if we offered a subsidy to make Seahawks tickets more affordable, that would succeed in nothing but driving up the price of Seahawks tickets. There are 67,000 seats; having more dollars pursuing those seats simply raises their value in the secondary market (or in the primary market, once the team caught on).

Although neither example is entirely apt for the housing market, a market radically constrained by zoning and various taxes on development is more like football than bus passes. If we make the ambitious assumption that Seattle also passed some form of rent control, and that regulation was so brilliantly designed that it avoided obvious pitfalls like subletting and condo conversions, then that would merely reallocate the fixed pool of housing from the highest bidder to the already-here and the well-connected. That’s great if you’re connection-rich and cash-poor, but it’s not a clearly more just framework.

All that said, to the extent that Seattle allows new construction and doesn’t smother it in developer costs, more spending power at the bottom should help the housing supply. Creating a whole class of people that can afford $800 apartments will certainly improve the balance sheet for nonprofit housing organizations. If we can ever satisfy the demand for “luxury” apartments, then someone looking to make a buck is going to have to chase those working-class dollars as well. In any case, even additional luxury apartments help to reduce demand for existing housing stock unless it destroys a large number of affordable units in the process.

The argument that it won’t make a big difference for housing affordability isn’t an argument to keep the minimum wage low. However, people worried about the cost of housing in Seattle should put more effort into increasing supply, whether or not it has the side effect of increasing developer profits.

Downtown Parking: Supply is Up, Demand is Down.

The Puget Sound Regional Council (PSRC) has released the results of their most recent parking inventory for the region (Excel file with methodology here). The numbers for Downtown tell a particularly important story, one that will need to be repeated over and over in the coming years.

In short, don’t let anyone tell you, ever, that Downtown doesn’t have enough parking. There are now over 78,000 parking stalls in Downtown Seattle (using the broader ‘Center City’ definition of downtown). Over 4,000 new stalls have been built since 2010.

Yet even with the significant job and housing growth seen in the last 3 years, 2,000-3,000 fewer cars per day are parking Downtown than in 2010. Commute Seattle reported earlier this year that drive-alone commuting is at a record low of 34%. Overall downtown parking occupancy rates range from 50-70%, far lower than the 80+% the city aims for in on street parking. Though our building codes mandate ever more parking (with limited exceptions), supply exceeds demand, and this imbalance is slowly accelerating thanks to overbuilding.

PSRC Parking 1Much more below the fold. Continue reading “Downtown Parking: Supply is Up, Demand is Down.”

Snow Open Thread

[Update 7:23am: Link is in the tunnel again. Definitely the best option today.]

[Update 2: Spokesman Bruce Gray says “crews did a routine maintenance check on one of the traction power substations Thursday night and had an issue with a voltage monitor when bringing it back online to start Friday a.m. service.” The Link outage had nothing to do with the snow.]

There’s snow on the ground. Remember tracking tools like OneBusAway do not work when buses are on snow routing. You can follow the mayhem at Metro (all buses currently on snow routes), Sound Transit, Community Transit (lightly affected), and Pierce Transit. Expect delays for everything — since 5:58 even Link has not been serving the tunnel for an undisclosed reason*. If your commute is freeway-dependent then WSDOT may help as well.

Also, walk to the top or bottom of the hill to catch a bus.  Your bus may not be able to stop on a steep slope. Share your tips and stories in the comments.

*Really not the day for this kind of thing to happen! Hopefully they’ll fix it soon.

TCC is Hiring

Transportation Choices Coalition is trying to organize the youngsters:

The Campus Transit Outreach Organizer will work with TCC, King County, University of Washington Transportation Services (UWTS) and other organizations to keep accurate and up to date on plans and processes for proposed King County bus cuts and timing associated with those cuts. They will in turn take that information and disseminate it to members of the UW community including, but not limited to, students, faculty, and staff at the main campus. Implement the outreach plan as outlined by TCC and UWTS…

Email your resume and cover letter by January 5th 2014 to rob@transportationchoices.org. Please include UW Outreach Organizer in subject line.

Applicants will be screened/interviewed as applications come in, so applying before the deadline is preferred.

College-age students are the sleeping giant for many environmental and urbanist issues with long time horizons, so I hope that TCC eventually expands this position beyond the specific issue of Metro cuts. If you meet the qualifications please consider this full-time paid opportunity.

News Roundup: Bad Reviews

This is an open thread.

October 2013 Sound Transit Ridership Report

Oct13MvgAvgAnother month, another double digit weekday ridership gain for Link and the fifth month in a row of over 30,000 weekday riders.

October’s Central Link Weekday/Saturday/Sunday boardings were 30,423/21,058/22,200, growth of 11.6%, 5.8%, and 28.8% respectively over October 2012. Sounder’s weekday boardings were up 2% (up 2% on the South Line, North Line was almost the same as last year).  Total Tacoma Link ridership was down 5.8% with weekday ridership declining 6.2%. Weekday ST Express ridership was up 6%, with most growth occurring on Crosslake, South King and Pierce routes. Complete October Ridership Summary here.

Link has seen double digit weekday ridership growth nine out of the past twelve months, and October year to date total ridership was up 10.7% compared to October of last year.

My Link charts below the fold. Continue reading “October 2013 Sound Transit Ridership Report”

Too Much Parking

Sightline Institute has a new report out entitled “Who Pays for Parking?” Among the findings:

Seattle-area apartment developers build far more parking than their tenants need. Across all developments in our sample, 37 percent of parking spots remained empty during the night, the time of peak demand for residential parking. Every development had nighttime parking vacancies, and four developments had more than twice as many parking spots as parked cars.

Many tenants don’t own cars. On average, the developments in our sample had 20 percent more occupied apartments than occupied parking spaces—a rock- bottom estimate for the share of apartments whose tenants don’t park on-site. In all, 21 of the 23 developments had more occupied apartments than parked cars.

Multifamily developments lose money on parking. No development in our sample was able to recover enough parking fees to recover the full estimated costs of building, operating, and maintaining on-site parking facilities.

Car-free tenants still pay for parking. Landlords’ losses on parking—calculated as the difference between total parking costs and total parking fees collected from tenants—add up to roughly 15 percent of monthly rents in our sample, or $246 per month for each occupied apartment. Because landlords typically recoup these losses through apartment rents, all tenants—even those who don’t own cars—pay a substantial hidden fee for parking as part of their monthly rents.

As the report states, there are multiple reasons for the parking oversupply, from city regulations to developer cautiousness.  And it’s far from clear that, if mandated parking were to go away, rents would drop 15% across the city.  Nonetheless, this study does a great service in confirming what many suspect: city codes mandate too much parking in order to pacify anxious neighbors, but many spots end up going unused, making housing more expensive.

Many years ago, I was searching for some commercial real estate for an entertainment venue. My memory’s a bit hazy, but I recall DPD telling me that, to meet the parking requirements, I could make an agreement with a neighboring property where the parking was in use at different times. So, for example, a church that’s only used on Sunday mornings could make an agreement with a nightclub that’s only open in the evenings to “double count” parking spots towards both venues’ requirements.

Going forward, it’s clear we need to reduce parking requirements.  Once that’s done, it would be interesting to see a similar double-count model applied to multi-family housing.  For example, if a 100-unit building has 37 unused spaces, then a 37-unit building could be constructed next-door, with an agreement that the tenants of the second building could lease spots in the first building and not have to build expensive – and redundant – underground parking. The result would be cheaper housing for everyone and a more equitable distribution of parking costs.

The City’s Terrible Rideshare Service Proposal

Lyft
A lyft vehicle in San Francisco. Photo by Spiro Vathis.

Last week, the city council published a proposal for a regulatory scheme for ride-share services such as Uber, Lyft and Sidecar. While the scheme would take currently illegal services out of the grey market, the proposal is truly terrible. I won’t go into details of the regulations, you can read those at the link above or this Seattle Times article ($), this Geekwire article (which has the best summary of the regulations) or this Publicola post. It seems clear the proposal’s intention is to appease incumbent taxi and car-service providers by essentially running these new-services out of Seattle by putting onerous and arbitrary restrictions on their operations.

But don’t take my word for it? Here’s councilman Harrell:

“Why wouldn’t we limit the number of TNCs?” Harrell asked rhetorically. “We are trying to limit supply. That is the policy choice we’ve made. I don’t see any ambiguity in that.”

I’ve never used Lyft, Sidecar, Uber or other ride-share services. I don’t take taxis either, generally. I usually try to plan ahead to make sure I either can take a bus or walk if I’m not going to drive. I can see why these services exist, though. Taxis are terribly expensive and never around when you need them. I’ve waited on the phone for more than 45 minutes just to request a cab before, for the cab to only show up an hour after the call. I’ve been in a taxi that blew a tire on I-5, pulled off the freeway and left me to walk the rest of the distance home[1], some five miles – lucky me I’m young and in good shape! Imagine if I had been a mother with children and shopping bags. I’ve been in taxis that have tried to charge me extra when we got to the destination because they couldn’t pick up fares there[2]. I’ve also been in cabs that have gotten completely lost and driven miles in the wrong direction, all on my dime.

So I understand why people want competition. We know there’s a public-safety issue late at night when the small number of taxis is insufficient to take home the number of people too drunk to drive. Try calling a cab on New Years’ at 2am. I can imagine someone, faced with the option of waiting a couple of hours for an expensive taxi ride, deciding to instead drive because they’re only a “little drunk”, which is really the worst option available. Reducing the number of available drivers and cars can’t help this problem.

Now, there may be a public safety issue the other way, with unqualified people picking up strangers and driving them around. But, presumably, these are people we let drive now, cars we allow on the road already, and passengers capable of making their own risk decisions. If someone is out to cause trouble and kidnap someone, for example, there are likely less troublesome ways to do it then sign up to be a Lyft driver.

At the end of the day, this is the populace and consumers of Seattle vs incumbent taxi drivers. I’m for anything that reduces the need to have cars, saves people money and increases public safety. You’d think the city-council might have similar desires but, sadly, they seem more interested in protecting special-interests.

[1] The driver tried to get me to pay for the distance up to that point, if you can imagine that.

[2] Surely, another sign of a broken regulatory scheme.

What Should Santa Bring Seattle’s Bus Riders?

A few months ago, with lots of help from STB regulars, I created the Frequent Network Plan to show how we could improve Metro’s Seattle/North King County bus network without adding any service hours.  That’s great, wrote guest writer and commenter extraordinaire Mike Orr.  But, he asked, how much money would it cost to get the bus network we really want?  Or, since it’s mid-December, what would Santa have to bring Seattle’s passengers to make it the best Christmas ever?

At first, I was reluctant to look into the question because I figured the results would be ridiculously unrealistic, especially when we are still trying to fight off a network-killing 17% cut.  But I started playing with maps and steadily got more interested.  I drew up an “ideal” network closely related to the FNP, but with the goal of making the best possible bus network regardless of resources, rather than using a fixed level of resources more efficiently.  Pictured is a small bit of that network.

SLU/Queen Anne
A bit of the “ideal network,” in the 33% funding scenario.
Red = 6 min. Orange = 7-8 min. Yellow = 10 min. Green = 12 min.

Then I put together a preliminary estimate of the service hours needed.  The answer surprised me: only about a 33% increase in service hours from today’s level.  That could actually come to pass, if there were a solution to the 17% cut, a few good years of economic growth, and maybe one more funding vote premised on meaningful improvements.  It’s realistic enough that the City of Bellevue considered a 30% increase as the best-case scenario in their 2030 Transit Service Vision Report.  A 33% increase is an attainable goal for medium-term political advocacy and makes for a credible network vision, not a fevered hallucination.

As I did with the FNP, I’ve created maps of this “ideal” network:

  • Color-coded by route (the labels reflect the +33% scenario).
  • Color-coded by frequency for both the +33% and the +15% funding scenarios.

Of course, a 33% increase, while imaginable, would be an uphill struggle.  So I created one more scenario, intended to show the lowest funding level at which the “ideal” network is meaningfully superior to the FNP network even though it aims for broader coverage and thus sacrifices a bit of efficiency.  I found that to be a 15% increase in hours from the current level.  The +15% scenario uses the same network (with two extremely minor changes), just with not-quite-ideal frequency levels on thinner routes.

Much more explanation follows below the jump.

Continue reading “What Should Santa Bring Seattle’s Bus Riders?”

Metro Funding: Bring the Sizzle!

One oft-cited reason for America’s crumbling road infrastructure is our politicians’ preference for shiny new highway expansion projects over unsexy-but-necessary repair and maintenance.  There are no ribbon-cutting ceremonies when you fix a pothole, or so the thinking goes.  This has led some opponents of highway expansion  — myself included — to call for a “fix it first” approach to road spending – i.e. prioritize maintenance.

But there’s a reason why “fix it first” is such a hard sell: politicians aren’t stupid. They know the voters like shiny new baubles, and so they oblige (re-read Ben’s post on Prop 1’s failure for more on this).

Transit advocates could learn a thing or two.

Over the last several years, Metro has been working to prevent a catastrophic drop in service through a series of short-term budget patches.  Currently, the hope is that the Legislature will allow King County the right to impose an MVET to prevent service cuts and provide a more sustainable revenue source.  Through a series of emergency measures, Metro has been able to minimize the short-term impact of these cuts.  However, I worry that the cumulative effect of this five-year drama is that citizens view Metro as a giant money pit in need of ongoing bailouts, when the truth is that it’s been robbed of a sustainable revenue stream and struggled to come up with an alternative.

In other words, the effort to save Metro has been framed as a fix-it-first affair: it’s all “eat your vegetables” and no sexy new spending. To get political support for a permanent funding solution, a different approach is needed. Where’s the steak? Where’s the sizzle?

For all the flaws in the execution, I’d submit that RapidRide was the right model, politically. A 0.1% dedicated sales tax to fund a shiny new service throughout the county.  RapidRide was voter approved, and the money was put in a lockbox that guaranteed it would be spent on the RapidRide service.

Since it looks like the legislature has failed to act anyway, and talk of secret plans is filling the airwaves, let me suggest an alternative approach, inspired by RapidRide.  Instead of asking for new taxing authority just to save existing service, the county should propose a new service.  For lack of a better name, I’ll call it FrequentRide.  The idea would be that a certain set of core routes would be upgraded to service every 10 or 15 minutes, seven days a week.

In terms of paying for such a service, we’d have several options. I think the last five years have taught us the limitations of a sales tax. An MVET is a nice alternative, and all else being equal I’d take it over a sales tax any day. A property tax, though, is better aligned with the goal of funding transit.  Expensive cars can be found anywhere. Expensive land, however, is typically concentrated in the densest areas which benefit the most from transit investments. No doubt, there are challenges to a property tax (Bruce details some of them here), but conceptually, it’s the right way to fund transit.

My very quick back-of-the napkin math says a property tax of $0.25 per $1,000 of assessed value would generate $75M in annual revenue*, which would cost the median King County homeowner about $100 per year.  By contrast, a 1% MVET could easily cost twice that for a family with two late-model cars.

As Martin recently wrote, making a separate Seattle transit agency is unlikely to be a panacea, but Seattle could get in on FrequentRide with a property levy of its own, focused on capital improvements like trolley wire, improved bus stops, and dedicated lanes.

By announcing Plan B, the County has indicated it’s ready to act if the state won’t.  That’s encouraging, but they should go even further. The public is ready for leadership.  As the saying goes, “be bold, and mighty forces will come to your aid.”

* I’m spitballing numbers here based on the King County Assessor’s website and various other sources – feel free to dive deeper in the comments. But again, I don’t care about the specific numbers as much as I care about reframing the argument.