​The Displacement Coalition's Response to HALA

Recently a coalition, calling itself “Growing Together” made up of some advocates, developer sponsored groups, and a few unions announced its support for the Mayor’s HALA plan.  Characterizing it as a “grand bargain”, these groups have given their support to the key component of the plan calling for upzones across our city and more tax breaks to developers, provided that in return for these added benefits, developers also would be required to set aside some low income and affordable housing in their projects (less than 10 percent of total units) or pay in lieu of fees to be used for low income housing built elsewhere. 

Rather than some grand bargain, it’s more of a faustian deal that will only accelerate the loss of low income housing, more displacement, and homelessness in our city.
 
The shortfall of affordable housing in Seattle is like a pyramid with the greatest deficit or shortfall for those at the bottom of the income scale.  By contrast the Mayor’s recently released “HALA” strategy turns the pyramid upside down, directing the bulk of the city’s attention and resources towards development of market rate and near market rate housing serving higher income groups. 
 
The assumption is that if we reward developers with tax breaks, more allowable height and density, relief from parking and other mitigation requirements, let them encroach into single family and lower density zones, unleash the forces of the market, then in return we’ll get a larger supply of housing units including a few more units affordable for those at the bottom. 
 
As has always been the case over the last four decades in Seattle, market driven strategies especially those aimed at ‘incentivizing’ still more development only will serve to accelerate the loss of existing affordable units and exacerbate the shortage of affordable units in our neighborhoods.  The Mayor/HALA strategy is simply a blueprint for more displacement and gentrification, and homelessness.  And it will add even more folks to years long waiting lists for public housing in our city.
 
The Mayor's/HALA plan aims to produce 50,000 housing units over 10 years but 30,000 would be priced at market rate and another 5000 would be priced at levels affordable to those earning between 60-80 percent of median.   There is a significant surplus of units already at these levels and we are drowning in market rate development as it is under existing zoning yet this is what the Mayor’s plan emphasizes.
 
Yes the Mayor/HALA plan presupposes use of linkage fee and mandatory inclusionary requirements.  Even with these mechanisms built into their plan - by their own calculations, it will only raise enough extra revenue to produce an additional 6000 very low income units priced for those at or below 30 percent of median, and 9000 low income units - units serving those at or below 50 percent of median. 
 
Currently, city data indicates there are 42,000 to 45,000 households in Seattle earning at or below 30 percent of median but only about 13000 to 16000 of them live in housing they can afford (and most of these affordable units are subsidized).  That's a shortfall of about 30,000 units for this income group.  Compare that to the Mayor's plan for only 6000 serving this group. 
 
The second greatest level of need is for those between 30 and 50 percent of median.  About 30,000 households in Seattle that fall into this category.  That means in total there are about 72000 households earning at or below 50 percent of median.  But the data also indicates there are only about 51,000 units priced at levels affordable to these households - for a shortfall of about 20,000 units.   
 
Meanwhile market forces set in motion by the upzones accompanying the Mayor/HALA plan will cause the loss of thousands of additional existing low cost units on exacerbating the shortage.  These losses will far outweigh the 6000 at or below 30 percent of median and 9000 from 30-60 percent of median created by his plan from added funds raised by a linkage fee and mandatory incentive zoning scheme. 
 
To top it off, by the Mayor's own admission, his plan doesn’t add up...it’s 250 million short of the funding needed to produce those 6000 very low income units.  Other sources will have to be found over the next ten years to realize these added very low income units.  There’s no shortage of dollars in the Mayor’s plan needed to produce those market rate and near market rate units - all 35,000 of them however.  The tax breaks and upzones will ‘incentivize’ their creation easily. 
 
There are numerous mechanisms that could be included to mitigate these housing losses such as a demolition control law requiring developers to replace 1 for 1 low cost units they remove and a right of first notice law giving nonprofit housing developers first opportunity to buy units that otherwise would be sold to developers.  But not one antidisplacement strategy was added to the Mayor/HALA plan.  They all were summarily rejected by the HALA advisory group top heavy with developer interests. 
 
(Note too that even if the City Council affixes some effective antidisplacement strategies to the Mayor’s plan - and we hope they do - such tools would not be adequate to offset the effect of mass upzones across the city and more tax giveaways to developers that will only further serve to decimate even more of our existing stock of low income housing.  We will still lose many more units that we can save or replace.)
 
The Displacement Coalition calls for a suspension of any consideration of upzones.  Let’s put first things first.  Adopt antidisplacement strategies, including 1 for 1 replacement, creation of special review districts, and right of first notice requirements.  Expand tenant rights including consideration of rent control but also make changes now we have local authority to make that serve tenants such as expanding relocation to more who are displaced and enhancing just cause.  Identify a new source of funding to dramatically expand revenues we can draw upon to address our housing shortage (thru such things as a locally authorized housing bond measure), and a coordinated strategy to prioritize and make use of public land for low income housing construction…..  
 
 
More details and explanation - facts etc to draw upon: 
 
There are 42,000 to 45,000 households in Seattle earning at or below 30 percent of median but only about 13000 to 16000 of them live in housing they can afford (and most of these affordable units are subsidized).  This means ther are at least 30000 households paying more than they can afford - 40-50-60 percent of their income on rent or more.
 
The second greatest level of need is for those between 30 and 50 percent of median.  About 30,000 households in Seattle that fall into this category.  That means in total there are about 72000 households earning at or below 50 percent of median.  But the data also indicates there are only about 51,000 units priced at levels affordable to these households. 
 
These households must rely on a continuing stock of unsubsidized rental housing.   These are older still relatively affordable unsubsidized red brick apartments, townhomes, duplexes, triplexes, cottages are usually located in transitional areas along arterials and on edges of single family zoned areas and many around rail stops in SE Seattle. Or they live in and rent an older single family home in these areas - either a family living there or it’s shared by up to 7 unrelated others.  About 25 percent of all Seattle renters live in these single family homes.  (I can provide sources for this if you like)
 
And of course this is the stock of unsubsidized units we are losing at a startling rate to the forces of redevelopment… directly to demolition or speculative sale……. and we have data giving us an indication of how rapidly this stock is being lost.  7300 lost to demolition counting those going thru permitting since 2005.  And over 1000 lost every year to speculative sale, owner turnover, refinancing, rents doubling or tripling as a result.  And demand driven rent increases pushing rents up above very low and low income thresholds for another 1000 households per year approximately
 
The Mayor and HALA proposed upzones will greatly accelerate these losses because most of these remaining affordable units precisely are located in the areas the Mayor intends to upzone especially w/in ‘walksheds’ of rail stops
 
Consider that every year the City adds about 300-500 subsidized units to its inventory serving those at or below 30 percent of median.  The Mayor plans to add another 6000 (as indicated in the HALA report) over the next 10 years serving this group. We’ll lose 3-4 times that number to the forces of speculation and redevelopment spurred by the upzones in the Mayor’s/HALA plan. 
 
(Note also that the HALA’s report, it’s members, and the Mayor acknowledge they did not factor in to their calculations/unit counts etc - these continuing losses of existing low cost units).
 
Recently a coalition, calling itself “Growing Together” made up of some advocates, developer sponsored groups, and a few unions announced its support for the Mayor’s HALA plan.  Characterizing it as a “grand bargain”, these groups have cast their lot with the plans call for massive upzoning across the city provided that in return developers will be required to set aside some low income and affordable housing in their projects or pay in lieu of fees to be used for low income housing build elsewhere. 
 
Rather than some grand bargain, the support some of these groups have offered is naive and sells out low income and working class people they’re professing to represent.  As we describe above, even with linkage fees downtown and mandatory incentive zoning elsewhere, the Mayor’s inverted pyramid primarily serves those at the top.  Only 6000 units would serve those at or below 30 percent and 9000 units for those between 30 and 60 percent of median.  It’s a top down plan and with these upzones will lose far more units to displacement/redevelopment than this strategy will created over ten years.
 
The Displacement Coalition call for a suspension of any consideration of upzones.  Let’s put first things first.  Adopt antidisplacement strategies, including 1 for 1 replacement, creation of special review districts, and right of first notice requirements.  Expand tenant rights including consideration of rent control but also make changes now we have local authority to make that serve tenants such as expanding relocation to more who are displaced and enhancing just cause.  Identify a new source of funding to dramatically expand revenues we can draw upon to address our housing shortage (thru such things as a locally authorized housing bond measure), and a coordinated strategy to prioritize and make use of public land for low income housing construction…..  
 
A Pyramid of Need in Seattle
 
As income rises, for obvious reasons, the shortage of affordable housing in Seattle drops. For 42,000-45,000 very low income households in Seattle with incomes at 0-30 percent of median (and another 3000 or so on any given night that go without shelter at all), there are only about 13,000-16,000 units city-wide priced at rents affordable to this group.   (meaning the household pays no more than 30 percent of their income for that unit).  For obvious reasons, most of the city’s attention should be focused on finding solutions to addressing this shortfall. 
 
The second greatest level of need is for those between 30 and 50 percent of median.  About 30,000 households in Seattle that fall into this category.  That means in total there are about 72000 households earning at or below 50 percent of median.  But the data also indicates there are only about 51,000 units priced at levels affordable to these households. 
 
There is a surplus of units in Seattle affordable to those at 60-80 percent of median
 
There remains stiff competition for units priced up to about 60 or 65 percent of median given influx of new residents and because so many lower income households can’t find lower prices units they can afford.  But data shows a surplus of units affordable to those above this threshold.  For example, there are about 30,000 households in Seattle that earn between 60-80 percent of area median but there are about 90,000 units in total at in Seattle priced at levels affordable to those earning at 60 percent of median, and about 110,000 (two-thirds of Seattle's rental stock) affordable to those earning at 80 percent of median.   (This moderate income group has the advantage of being able to tap a stock of units affordable at their income levels but also that stock of lower priced units affordable to those earning less than they do)
 
The Mayor/HALA’s Inverted Pyramid of Solutions - trickle down in another form
 
Which brings us back to the Mayor/HALA inverted pyramid. Their strategy, consisting of over 60 specific recommendations, envisions production of 50,000 new units in Seattle over ten years.  Realized largely by upzones and giving away more tax breaks to developers, fully 30,000 of that total would be priced at market rate.  In this town, we’re talking about units renting for over 2000 a month and rising from there.  Another 5000 would be priced at levels affordable to those earning at 60-80 percent of median. 
In effect, about 70 percent of the units created under the Mayor/HALA plan are aimed at adding still more supply to the surplus of units that already exists in Seattle serving these income groups. 
 
Only 6000 of the units in his plan target those at or below 30 percent of median even though now there is an identified shortfall of over 30,000 needed by this group.  Another 9000 would serve those between 30 and 60 percent of median even though there is a shortfall of about 10,000 to 15000 units affordable to this group.