O'Brien Sets Aside Blanket Linkage Fee, Promotes Housing Compromise

Murray and O'Brien roll out legislation for inclusionary zoning and commercial linkage fee.

By Josh Kelety September 1, 2015

This morning, outside of the Cascade Court Apartments on First Hill, mayor Ed Murray and council member Mike O’Brien, flanked by affordable housing advocates and for profit and non-profit developers, rolled out legislation based on two recommendations from the Mayor’s 28-member Housing Affordability and Livability Agenda committee (HALA): 1) a mandate to pay affordable housing fees or include affordable housing in all residential projects in exchange for citywide upzones, a policy known as inclusionary zoning and 2) a commercial linkage fee that makes developers pay into an affordable housing fund when they build commercial developments. O’Brien, who had been advocating a broader, blanket residential linkage fee resolution that passed council last year with no upzones for developers, is standing by this new proposal.

The legislation has two components. First is the mandatory inclusionary housing program, which requires all new residential development in the city to set aside a certain number of units (5 to 8 percent to be exact) to be affordable, with rents restricted to no greater than 60 percent of the adjusted median income for 50 years (60 percent translates to a little over $1,000 per month in rent for someone making $37,680 annually or a family of four making $53,760). In exchange, developers can get an additional story to build additional units; though, they have to build the affordable units whether they take the upzone or not. The upzone will require height increases in urban villages and urban centers to accommodate the building bonus. If developers opt out of building on site, they can pay a fee into city's housing trust fund for off-site housing construction.

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Image courtesy of the city of Seattle

 The second aspect is a Affordable Housing Impact Mitigation Program (AHIMP), or a commercial linkage fee, which will force commercial developers to pay a fee of $5–$17 per square foot (commercial developers can also choose to build an equivalent amount of affordable units on or off site.) Commercial developments will also get the automatic upzone.

Mayor Murray and Council Member O’Brien say these measures will produce 6,000 units of affordable housing over ten years. “With this legislation, Seattle—for the first time ever—will require that all new development in the city will pay for affordable housing,” Mayor Murray said.

“Our goal is to build 20,000 units of affordable housing in the next ten years. That’s probably not enough. But from the private development community there will be 6,000 of those [units], so that’s a step in the right direction,” O’Brien told reporters after the press conference.

The legislation has the support of for-profit developers (who are traditionally opposed to equations that make the developer pay.) Super urbanist, A-P Hurd, president of the local development firm Touchstone, stood by the mayor and called the action an “important part of a much larger strategy to address housing affordability in Seattle.” The Downtown Seattle Association (which represents downtown commercial interests) also released a statement in support.

Jon Grant, former Tenants Union director and candidate for at-large Position Eight city council seat who was a dissident member of the HALA committee, says that while he supports both aspects of the legislation, he thinks the percentage of units set aside in the mandatory inclusionary housing program should be increased. “I would like to see something closer to 20 percent or 25 percent,” Grant told PubliCola. And as he’s been pushing for month now, he wants to see a residential linkage fee in the legislation, saying that last year's linkage fee council resolution has already passed environmental review and could be implemented sooner than inclusionary zoning (the later is estimated to go into effect two years from now, in 2017).

 Minutes after the Mayor formally unveiled all 65 of the HALA recommendations earlier this summer, Grant, flanked by socialist city council member Kshama Sawant, headed up the the HALA’s-not-good-enough crowd. Grant’s alternate HALA proposal, which includes expanded tenants rights, rent control, an expanded linkage fee program on residential development to fund housing for those making zero to 30 percent AMI, did not feature mandatory inclusionary zoning with an upzone for developers, though he told me today he supports that aspect HALA recommendation.

At that press conference, we asked Sawant and Grant if O’Brien, the original proponent of the blanket linkage fee and her main council ally, backed their proposal. She said only that O’Brien had been briefed.

Council member O’Brien told PubliCola today that while he is open to looking at different ways of producing affordable housing, he “doesn’t want to undermine this deal.”

“I think what we’ve accomplished is an amazing step forward. And I’m going to support the deal that was struck.”

O’Brien says that this approach is a “clearer legal path,” referring to state law which allegedly allows cities to require affordable units from developers. “The benefit of that [his legislation] is it’s a much clearer legal path. The development community supports it. And we can implement it much quicker.” He added that if this deal somehow falls apart he would be open to revisiting his residential linkage fee proposal from last year.

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Image courtesy of the city of Seattle.

 The legislation will be introduced next Tuesday on September 8th in the Select Committee on Affordable Housing in the form of a resolution laying out the timeline for the Department of Planning and Development and the city to conduct all the precursory work that needs to be done before the mandatory inclusionary housing program and upzoning is implemented (e.g the environmental review process, neighborhood outreach.) They will also propose an ordinance to enact the commercial linkage fee, with the hopes of passing both in late September.

“We need a full suite of tools to address a full continuum of affordability. And so the mandatory inclusionary housing program and the linkage fee program are plugging in at that 60 percent AMI level,” Steve Walker, Murray’s director of the Office of Housing told PubliCola. “We have our affordable housing levy which is plugging in typically at a lower income, the extremely low income, the homeless population, and so when we put all of these tools together, it’s to address the full continuum. So this is plugging in, rightly so, at the low-wage workforce.”

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