Three High-Impact Recommendations Identified to Promote Affordable Housing Choices for Workers Who Comprise the Majority of the City’s Workforce but Mostly Live Outside of City Limits
Seattle (January 22, 2019) – Weeks after announcing a record $110 million City of Seattle investment in low-income affordable housing development, Mayor Durkan’s Affordable Middle-Income Housing Advisory Council, delivered a suite of strategies that together, government, the private sector and community organizations can act on to increase housing options available to middle-income families and individuals.
The new approaches, which will be considered by Mayor Durkan over the coming months, are suggested tools to help create more opportunities for homeownership, bring more housing online faster, and increase housing options in neighborhoods throughout the City. Too many of Seattle’s working families, including those who serve in our schools and hospitals, in our restaurants, as maintenance staff, and thousands who keep our small businesses running, struggle to find a place to live in our city that they can afford.
“Seattle has become too expensive for most working families. We need more affordable housing if we want to remain a just, welcoming, and equitable city,” said Mayor Jenny A. Durkan. “We have a huge need and must take a range of actions to create more affordable housing. Without real solutions our communities experience negative climate impacts and increased traffic congestion as workers are forced to commute longer and longer distances while missing out on valuable family time. I’m incredibly thankful to the entire council, who met over the past year to explore new tools and find real solutions for Seattle’s working families.”
Mayor Durkan convened the City’s first-ever Affordable Middle-Income Housing Advisory Council, comprised of experts from the housing development, labor, financing and legal community, in January 2019 to explore ways to fill the gap between market-rate housing and the housing needs of middle-income families. This week, the Advisory Council delivered a report containing nearly 40 recommendations, elevating three high-impact actions:
- Reduce costs of building housing by promoting partnerships with private sector investors and philanthropic dollars for innovative real estate financing. Many of our region’s employers are already committed to solving this problem to ensure the future of their workforce. The City should work with private and philanthropic partners to galvanize efforts, and to create innovative measures to address the housing challenges of middle-income workers.
- Advocating to the State to extend the Multifamily Tax Exemption (MFTE) program beyond 12 years of affordability. MFTE is one of the City’s few tools to create low- and middle-income housing, with over 5,000 homes in market-rate buildings and another 1,600 in the pipeline to come online by 2022. Without action by the State legislature, nearly 1,200 of these units will revert to market-rate housing in the next five years.
- Reduce construction costs and bring new homes online as quickly as possible by reforming permitting practices. The City should commit to addressing permitting chokepoints and reducing conflicting direction from departments given to developers that drives up housing costs.
“The Advisory Council remains committed to help with this effort. While our formal work ends with these recommendations, we will assist the City in its implementation by supporting necessary engagement and legislation for City actions to propel the work forward,” said Ezra Teshome, co-chair.
“Many of these actions fall squarely within the City’s control. The City can streamline its permitting process and address regulatory barriers with the goal of creating more affordable and market-rate housing,” said Washington State Labor Council President and Advisory Council co-chair, Larry Brown
Mayor Durkan recognizes that a surge of investments is needed to address the needs of middle-income employees who earn 60 to 120 percent Area Median Income (AMI), individuals with incomes between $46,500 and $93,000 and families of four between $66,400 and $132,850 – parallel to continued City investments towards very low- and low-income communities. Between 2011 and 2018, Seattle rents increased 57 percent, the sales price of a detached house increased 65 percent, and the sales price of a condominium increased 48 percent, driving working families out of the City. Employees in low- and middle-income occupations comprise 85 percent of Seattle’s workforce: more than 560,000 Seattle jobs are in occupations that pay less than $100,000 per year on average.
“For many years, the City’s response to the broader housing affordability crisis has appropriately prioritized housing for low-income households and support for our neighbors experiencing homelessness,” said Advisory Council Co-chair and former Washington State Governor, Gary Locke. “Our work seeks to advance a third and critical objective, which is to support strategies that address the growing housing affordability needs for Seattle’s middle-income workforce.”
In 1981, Seattle voters instituted the Seattle Housing Levy, making annual investments to provide affordable housing for residents who are homeless and low-income. Last month, Mayor Durkan announced a record $110 million in City funding, leveraged to more than $710 million with investments from regional and federal partners for new low-income affordable homes. Since December 2017, the City has leveraged nearly $1.5 billion in funding through the Housing Levy, Incentive Zoning and Mandatory Housing Affordability, and Real Estate Excise Tax to generate housing for individuals and families at or below 60 percent AMI.
“The Advisory Council applied our collective expertise in housing development and investment to elevate strategies to help close the growing gap between housing produced and what middle-income families can afford,” said Ada Healey, Vulcan Real Estate and Advisory Council Co-chair
The Office of Planning and Community Development issued their Housing Choices Public Engagement Summary which includes survey results of housing needs sought by individuals who live and work in Seattle. Housing Choices was a benchmark used to help inform the Advisory Council in their pursuit for meaningful solutions.