Morning Fizz

Morning Fizz: Opportunity for Exploitation

Caffeinated News & Gossip featuring: microhousing amendments, rejecting amendments, and rejecting GOP spin

By Morning Fizz September 8, 2014

1. On Friday afternoon, the city council's Planning and Land Use (PLUS) committee discussed City Council member Mike O'Brien's proposal to incorporate microhousing into existing development regulations. Apodments, as the small living spaces are branded, have avoided traditional  design review with a head fake on threshold unit counts by divvying units up into several living spaces.

O'Brien summed up that his intent was to "take this building type, microhousing, that was largely falling outside of our existing regulatory process, and bring it into that existing process." His proposal, which drew mixed reviews from both neighborhood activists who are wary of microhousing and developers who want more of it: would require a minimum 220 square foot average for living spaces throughout the building; would require one sink per dwelling unit; and set varying levels of design review based on square footage of the building as opposed to unit count.  

During public testimony, neighborhood activist Bill Bradburd from the Seattle Neighborhood Coalition jumped on the existing design review loophole point saying the land use code is "very vague and non-descript and has created this opportunity for exploitation," complaining about "totally unregulated" projects that need to be put on hold until a stakeholders process can determine "what types  of amenities should be in there."

Bill Bradburd, Seattle Neighborhood Coalition

Bradburd said the lack of guidelines were allowing developments "with very large numbers of very small sleeping rooms with perhaps 100 people sharing a kitchen."

He continued, addressing opponents of the legislation more than O'Brien, saying:  

"We've been producing housing through DPD [Department of Planning and Development] looking the other way on issues like counting units. What we are trying to do is get our arms around something that has become a very large  problem for many neighborhoods. All of us do want ... affordable housing for people. [But] to portray the changes that you're proposing as somehow affecting the affordability of these units—these are not affordable by any standard, they're just priced below market rate. We have not seen anything from a pro forma standpoint how these things are really priced if these changes you're proposing will really affect the bottom line."  

While neighborhood activists like that O'Brien is trying to rope microhousing into the regulatory process, they'd prefer that unit count—which more accurately tracks their concerns about impacts on the neighborhood—trigger review.

O'Brien explained his preference for the square footage trigger—5,000 square feet to 11,999 feet for a streamlined review; 12,000 feet to 19,999 square gross feet for a stricter review; and 20,000 square feet and larger for a full blown design review—this way: "If it's around number of unit types, I'm worried that a developer might say, 'Well, I could put eight units in this building, really small ones and they'd be more affordable, but I might trigger design review, and instead why don't I build six larger units and just charge more for them because then I could avoid design review because that's fewer units?' And that trade off in a developer's mind, I would like to avoid." 

The developers who testified at the hearing seemed resigned that microhousing was going to come under design review, but took issue with the square footage minimums. Microhousing developer Scott Shapiro told the committee that "there is no good policy reason to limit the average apartment size to 220 net square net feet."

Calling it  "a defacto downzone," he said the rule "will both reduce the number of available units while at the same time increasing the average rent per unit." [The developers warn of an increase in average rent from $850 to $1250.] "We have a housing crisis in our city of not enough apartments at an affordable rate and not enough apartments period," he said. 

"There's a deluge of housing demand," another developer, Robert Dedon said, "and we don't want to turn those people into commuters." 

O'Brien himself seemed in sync with Dedon's environmental pitch. 

City Council member Mike O'Brien

When council member Tim Burgess questioned O'Brien's lax-ish regulations—Burgess wanted a hard minimum square footage requirement rather than the 220 average (lowest in the country)—slyly noting that the city doesn't just allow McMansion developers to build as they see fit, O'Brien responded:

"The McMansion parallel, for me what I'm looking at is there a public need that's being served here that's consistent with our policy? McMansions were insonsistent with the  directions we wanted to go in this city. I think actually having people live in smaller units by their own choice is an environmental decision that supports those goals and it also provides some affordability levels."

The committee didn't vote, and will take up the legislation will come up again at the next PLUS committee meeting.  

2. In contrast to all the hand wringing about density when it comes to microhousing, the committee promptly approved another piece of O'Brien legislation on Friday afternoon that promotes density: Mandating a minimum density requirement for new developments in business districts and ped zones around the city from Lake City to Capitol Hill to Rainier Beach to West Seattle Junction to Uptown to Phinney Ridge. (The legislation makes developers build to at least half the allowable square footage allowed in those districts.)

The outstanding question, brought up by the Seattle Neighborhood Council, was wether developments that had other green features could waive the density requirement. "I'm not prepared to make any changes to the underlying legislation today, and I think it's [the legislation itself] important enough that we proceed on this, and I can't commit to any further discussion on this [amendment]."  

The committee seconded O'Brien and the legislation passed the committee unanimously. 

3. There was actually some good news for education funding last week: The Guaranteed Edcuation Tuition (GET) program—an investment fund that lets parents buy college tuition vouchers at current prices, with the state covering the difference 18 years later when the kids go off to college—has fully recovered from the recession.

"None of us are above a good old fashioned campaign season boast, but the claim that the Senate GOP froze tuition without a tax increase is political malpractice."

The fund was underwater just two years ago and Republican leadership in the state legislature, including GOP budgeting lead state Sen. Andy Hill (R-45, Kirkland), turned the fund into a symbol of overblown government spending.

The AP quoted Sen. Hill grumbling about GET back in Janaury 2013: "'It's a job that our government doesn't need to do,' said Hill, noting that similar though less generous savings programs are widely available to consumers in the private sector."

But now that GET—just as Democrats who defended the populist program predicted—has recovered with the economy, which is exactly the beauty of long-term investment funds, we asked Sen. Hill if he stood by his knee jerk Republican impulses. (GET is currently valued at $2.93 billion, a $371 million increase over last year when it only had 79 percent of the funds on hand to cover its liablilities; now it's at a healthy 106 percent.)

Here's what Sen. Hill told Fizz: 

I have concerns with any state program that privatizes gains and socializes losses. It goes to a basic question of fairness.  There was a $630 million unfunded liability in the GET program, and the main reason that the GET program has recovered is due to the Majority Coalition Caucus priority to freeze tuition.  If you look at the House budget, they would have raised tuition by 10 percent in the 2013-15 biennium, which would have put the GET program in even worse shape, regardless of stock market performance.

Footnote on Hill's $630 million liability: That's a reference to what would have happened if everyone in the program cashed in at once, which isn't how a fund where families are investing in future students works

He's right that the GOP froze tuition costs. But not without a heavy lift from the Democrats, who found the money for the savings by pushing legislation that the GOP initially resisted: Closing a $109 million loophole for landline telecom compnaies

Says Hill's Democratic house budget counterpart, finance committee chair Rep. Reuven Carlyle (D-36, Queen Anne): "None of us are above a good old fashioned campaign season boast, but the claim that the Senate GOP froze tuition without a tax increase is political malpractice. The truth and record is that the legislature was able to freeze tuition because we passed bipartisan, sweeping telecommunications reform legislation that raised tens of millions of dollars in new revenue. We directly allocated those dollars to higher education and together--Democrats and Republicans, House and Senate--held tuition down."  




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