A Linkage Fee for an Affordable and Just Seattle

Low-income advocates make the case against de facto segregation.

By Ubax Gardheere and Lauren Craig March 27, 2015

Southeast Seattle has the distinction of possessing both the lowest-income rate and the highest rate of poverty of any area in Seattle. Here, affordable housing and quality jobs are increasingly hard to find for low-income people and families, who are disproportionately people of color, immigrants, and refugees. Demographic changes in Southeast Seattle and South King County indicate that people of color have been displaced from their communities as the cost of living in Seattle has become unsustainable for them.

Of the African Americans who have remained in Seattle, 35 percent are paying more than half of their income on housing costs. As a result, low-income communities and communities of color are relocating to resource-poor suburbs while a largely white and wealthier population remains in Seattle. This is the definition of de facto segregation (segregation that happens as a result of land use patterns and other laws that were inherited from a time of legally-mandated segregation), which followed the overt de jure form of segregation (legally mandated segregation).  

Inclusionary housing policies have historically been a tool to combat segregation by race and class. Seattle cannot propose a bold and just affordable housing agenda without also passing an inclusionary housing ordinance—specifically, a linkage fee—to help reverse patterns of exclusion. A linkage fee asks developers to set aside a small portion of new units as affordable or contribute to the city’s affordable housing fund. Because it would be applied broadly across the city, it requires only a modest contribution (3 to 5 percent of new units or equivalent fee) but would become one of Seattle’s best tools to create affordable homes for low and moderate wage workers and families. If a linkage fee is not passed, the city would miss a significant opportunity to create thousands of permanently affordable homes where communities are experiencing displacement.

Low-income communities and communities of color are relocating to resource-poor suburbs while a largely white and wealthier population remains in Seattle.

The linkage fee boasts over 45 organizational endorsers, including architects, labor, faith communities, housing, environmental and social justice advocates. Puget Sound Sage’s policy team leading the effort include economic statisticians, land use and housing policy experts with years of experience analyzing data, legality and potential ramifications of public policy.

We support inclusionary housing policies like linkage fees because they support affordability and work to prevent displacement alongside growth and density. We have seen those opposed to linkage fees often conflate linkage and impact fees with restrictive zoning laws, which do restrict supply and prevent development. We support density proponents in the fight to upzone the rest of Seattle, with the caveat that such upzones must be tied to reasonable affordability requirements and community benefits rezones to prevent displacement while promoting growth.

Similarly, some are concerned policies like linkage fees raise rents. Linkage fees do not drive up the prices of housing. In fact, Dr. Jenny Schuetz, a researcher at the University of Southern California, found that implementing inclusionary housing programs had no effect on housing prices in the San Francisco Bay Area.

Most new market rate buildings target well-off urban professionals, such as Amazon, Google and biotech workers.
The rents are skyrocketing in Seattle, up 33 percent since 2010 in the urban core. Housing prices in strong markets are mostly determined by high-end demand. Most new market rate buildings target well-off urban professionals, such as Amazon, Google and biotech workers, because those consumers are willing and able to pay top dollar for housing.

As long as Seattle continues to attract and sustain high-paid professionals, developers and investors will continue rational, profit-maximizing decisions to cater to their housing needs. This new development makes affordable housing less available for low and moderate-wage workers.

In early 2014, the city hired national experts to conduct both an economic feasibility analysis (in other words, show developers will still make a significant profit) and legal framework—aka a “nexus study”—for a linkage fee. Specifically, the nexus study: “1) establishes a causal relationship between new commercial and residential development and demand for low and moderate income housing; and 2) quantifies a maximum supportable linkage fee to mitigate the impact of that increased demand.” This demonstrates there is a “link” between the development and the decrease in affordable housing, hence the term “linkage” fee. 

Opponents have accused us of wrongly bringing race and class into this conversation, and that it is about simple economics. But, race and class do matter in this fight for a linkage fee policy because housing and zoning issues are intrinsically connected to issues of race and class.

Southeast Seattle has over forty distinct ethnic groups, and it has often been dubbed the most diverse zip code in the nation. This is not by accident. Through the late 1960s, like many other cities in the nation, Seattle was a segregated city, and Rainier Valley was one of the only neighborhoods where people of color were allowed to live.

The University of Washington possesses evidence of the racially restrictive neighborhood covenants and deed clauses that were attached to most homes in Seattle during that time. Also, blatant exclusion of people of color from most jobs, most neighborhoods and schools, stores, and other institutions was rampant in Seattle for much of its history. Racial discrimination in Seattle targeted African Americans, Native Americans, Asian Americans, Pacific Islanders, Mexican Americans.

These are disparities our city has long sought to change. Non-profit developers and the Office of Housing in Seattle have been extremely skilled at utilizing and administering funds for the development of affordable housing. Indeed, Seattle’s voters have a long history of supporting affordable housing to help prevent displacement. But, we know more tools are desperately needed. We are at a turning point. De facto segregation in Seattle is deepening racial disparities in this city. In order to ensure that Seattle is a city where all can thrive, we cannot wait any longer to implement the tools we know can help reverse these trends.

Yes, Seattle has a history of segregation, oppression of indigenous populations, and racism just like every other inch of the United States of America. But there is an enormous opportunity in Seattle to do the right thing before it's too late. Bold policymakers like mayor Ed Murray through the Housing Affordability and Livability Committee process, council member Mike O’Brien who sponsored the linkage fee resolution, and council members who voted for the linkage fee resolution understand that we are accountable to helping prevent de facto segregation. We look forward to working with all of Seattle’s elected officials to take bold action in 2015.

We cannot reverse 400 years of oppression and segregation, but the least we can do is pass a modest policy with a proven impact so that more people with the lowest incomes can have the chance to graduate college, bring home a living wage, and put a roof over their head, while still allowing developers to make a substantial profit. It is that simple.

Ubax Gardheere is the program manager at Puget Sound Sage and Lauren Craig is the policy counsel.

Last month, PubliCola published an opinion piece by urban planner Dan Bertolet that opposed the linkage fee.

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