The days of trying to “incentivize” Seattle developers to build more affordable housing could be nearing an end. Under a plan released by the city Thursday, developers building in certain Seattle neighborhoods could be required to make up to 10% of their new units affordable and/or pay a fee that would fund thousands of new affordable apartment units.
It’s one of the first tangible results of the City Council’s effort to force developers to contribute more affordable units amid a boom of residential construction in the city, particularly on Capitol Hill. The policy could also be key in realizing Mayor Ed Murray’s goal to create 20,000 units of affordable housing in the next decade.
The Affordable Housing Mitigation Program calls for developers to pay a linkage fee on new developments, as high as $28 per gross square foot, into an affordable housing fund. Over ten years, DPD estimates the fee could generate around $1.16 billion to create 14,500 new affordable units. The inclusionary zoning part of the plan would require developers to make up to 10% of their new units affordable to create 5,900 affordable units in 10 years, according to DPD models.
According to the plan, drafted by the Office of Housing and the Department of Planning and Development, inclusionary zoning and linkage fees could be implemented together or as a pay-or-play model.
Linkage fee amounts would likely vary depending on location. Pike/Pine and First Hill is being considered for a “high” fee area while the rest of Capitol Hill is being considered for a “medium” fee range.
Under the inclusionary zoning plan, all participating rental units would have to be affordable to those households at 80% of the area median income. However, the plan leaves open the option of dropping the targets as low as 60% of AMI for units with one or more bedrooms and 40% of AMI for small units.
DPD also considered a proposed list of updates to the city’s current voluntary incentive zoning program, which tries to encourage developers to include affordable units in projects by allowing them to build bigger and taller. However, proposed changes would not adjust the building dimensions allowed under the current program.
In October, the City Council voted to have the city develop the linkage fee program. At the time, Seattle had the fastest rising rents among major U.S. cities, causing some officials to say affordable housing had become a full-blown crisis.
Talk of the proposal had previously drawn serious ire from developers and their attorneys, some of whom were present at previous committee meetings. During a committee meeting last year, former City Council member Sally Clark said that it was not lost on her that perhaps dozens of attorneys were listening in, but she said the plan would move forward.
Developers will almost surely take advantage of an opportunity to appeal DPD’s environmental review of the proposal — a common tactic for trying to halt new legislation.
Linkage fees have also become an increasingly talked about topic in this year’s election. During Monday’s Council District 3 forum, candidates were asked in a lightning round if they supported such developer fees. Incumbent Kshama Sawant and Morgan Beach said yes, while Pamela Banks, Rod Hearne, and Lee Morgan waffled on the issue.
The city is now accepting comments on the proposal and the DNS through June 25th. Comments may be sent here:
City of Seattle, Dept. of Planning and Development
Attn: Brennon Staley
PO Box 34019
Seattle WA 98124-4019