Governor Inslee Fails Simple Test and Vetos a Study on Housing Costs

Over the last year two years, non-profit housing agencies, the Capitol Hill Housing Improvement Program (CHIP) and El Centro De La Raza (El Centro), each completed a housing projects, CHIP on Capitol Hill in 2015 and El Centro on Beacon Hill last year, in 2016. The CHIP project has 88 units of housing and the El Centro project 112, a total of 200 units. The total cost of the CHIP project was $47 million, $534, 091 per unit, and the El Centro project $45 million, or $401,786 per unit. Together, the two projects cost $92 million for 200 units of subsidized, rent restricted housing, $460,000 per unit. The El Centro project has a wait list that is five years long.

Meanwhile, in Eastern Washington the Growers League produced 200 units of shelter beds for farmworkers for $3 million or about $150,000 per unit. And every developer I’ve talked with tells me that not only is the cost of these projects exceedingly high (there are many townhomes in Seattle in the $400,000 to $600,000 range), but market rate builders and developers build multifamily housing for anywhere from $150,000 to $200,000 per unit, about half what the two agencies spent to build their projects.

Why is there such a big difference?

Well, the Governor of Washington, Jay Inslee, isn’t interested in asking or answering that question.

Last week, the Governor vetoed a budget item that would have set aside $500,000 to fund a study by the Joint Legislative Audit and Review Committee (JLARC) to do just that. His veto message said, in part,

The solution to our state’s housing crisis is less a comparison between market rate and subsidized housing than it is a comprehensive set of all available options to meet a serious need. For this reason, I have vetoed Section 103(4).

Aside from the awkward phrasing, the statement raises more questions than it answers about the Governor’s view of housing in the state. When did the “housing crisis” start? What is the crisis? If the crisis is a rise in housing prices, why are those prices rising? How can we find a solution if we don’t know why? And if subsidized housing is part of the, “set of all available options,” shouldn’t we understand how we could improve the efficiency of those subsidies?

Not according to Inslee. From his statement, it’s pretty clear that “all available options” means more money for the non-profit housing industrial complex: don’t ask questions just find more money.

What the Governor and his housing advisor Jim Baumgart have done is to essentially communicate that his letter sent to the Affordable Housing Advisory Board (AHAB) wasn’t serious. In that letter, delivered with a strong message by Baumgart that the Governor wouldn’t settle for just another long, wordy report, the Governor called for looking at “zoning and planning, permitting, development, and financing and construction processes” and that the AHAB should, “define where barriers exist and provide recommendation on how to remove these barriers.”

The product of that letter was a lengthy, and wordy report that had very little in terms of actual analysis of the causes of high prices and rehashed a lot of older, unimplemented recommendations that would have little impact on the production of housing.

Baumgart and Inslee are smart people. Even if all the letter was intended to do was find out how to produce more non-profit subsidized housing, the most obvious question would be, “are we paying more for units than we should, and is there a way to make our subsidies go further, to create more non-profit subsidized units?” This leaves aside the basic and fundamental economic fact that housing is expensive because there are more people that need housing that the market and the non-profits can produce. Why would Inslee and his advisor say that this isn’t important? The answer is simple: politics.

The non-profit housing industrial housing complex has a lot of power and pull, and they don’t want the public or people making policy to find out that their product is so costly to produce. 

Unfortunately while Inslee and Baumgart cave to the non-profit’s powerful lobby that doesn’t want a light on their inefficient and corrupt system, there is a young person struggling to find a place to live, there is a family making a tough choice about living far away from work because housing in Seattle is too expensive, and a man who doesn’t have enough money to move away from his partner that is becoming more and more violent. This is the real world. The Governor would rather not know why these people have to wait five years for those $500,000 housing units. I wonder if it’s because of the costs to produce those units. Thanks to his veto and the non-profit industry, we won’t know the answer.

666: The Devil’s Post

Well, here we are. This is the 666th post on the Smart Growth Seattle website. Maybe this is the end. We’ll see what happens next. Over the course of the last four years we’ve been joined by a variety of contributors and covered a range of topics and issues. I wish I could look back at all these posts and say they had made a big difference. I can’t. But that is the nature of both promoting change for a better future and protecting what is valuable about our past. My experience with the smoking ban is a lesson I try to keep in mind. There wasn’t one thing that made the difference in moving our state and city toward a wide and comprehensive limit on smoking. But there were moments to remember.

One of those moments came after we passed the smoking ban and I got a call from a major contractor working on big high rise projects downtown.

“Can we ban smoking on our work sites with this new law?” the voice asked.

“Of course,” I said. “Just do it.”

“That’s all I needed to know,” the voice said. “Thank you.”

And just like that, smoking was banned at numerous worksites. I’d guess that there isn’t a major worksite that allows smoking.

The truth is the law had nothing to do with that specific issue. The employer, in this case, didn’t need the law. They could have banned smoking because they wanted to. All I did was give them permission. The nervous and worried people at the Department of Health at the state level had given them a long bureaucratic answer. Maybe. Maybe not. Blah. Blah. Blah.

“Just do it!”

I was just in Louisiana on a brief trip and we managed to fit in a boat trip out to the bayous and swamps outside New Orleans. The tour guide boated us all over and alligators would come up to the boat and he, and anyone else who wanted, could take a stick with a hot dog and feed the alligators.

“The big ones are awfully shy,” the tour guide told us. “They didn’t get that big by taking lots of risks.”

So it is with people and bureaucracies. The alligator repeated himself a lot, and he said more than once when talking about the alligators, “That’s two hundred million years of evolution right there!”

There are two things about evolution that are important. One is that it tends to favor stability. Stay out of trouble, avoid conflict and you’ll live to be a big and old gator in the swamp. The second, is that change is inevitable, and when the environment changes the organisms that can adapt to change end up passing on their genes into the future.

What’s true of the swamp is true of social change. Yes, if we go with the flow on housing issues and just accept bad policy like Mandatory Inclusionary Zoning (MIZ) some of us might be ok and get fatter, longer, and older. But, if we hang on, we might just find that things will change. And if we’re patient, people will come around.

When was the last time you heard someone complain about cigarette smoke in a bar in Seattle? When was the last time you heard someone complain about a no smoking policy in an apartment building? In a rental property? In a rental car?

So here’s to the next 666 blog posts. Maybe I won’t have to write that many more before we get where we need to be.

Alligators. The Omen. Cigarette smoke. Bad housing policies. I hope I didn’t give you nightmares.

The Mayor and City: Bad Policy Backed by Bad Data.

There is a pretty damning report by Daniel Person at the Seattle Weekly that found the City, and in particular the Mayor, cooked the books on the impacts of the $15 minimum wage

To review, the timeline seems to have gone like this: The UW shares with City Hall an early draft of its study showing the minimum wage law is hurting the workers it was meant to help; the mayor’s office shares the study with researchers known to be sympathetic toward minimum wage laws, asking for feedback; those researchers release a report that’s high on Seattle’s minimum wage law just a week before the negative report comes out.

I wish I could be shocked, but it isn’t surprising. Remember when Tom Rasmussen and Sally Bagshaw wrote to the Mayor saying that we needed to build 6,000 units of subsidized housing for a decade to solve the “housing crisis.” They said,

To reach 60,000 – 85,000 units, we must increase our supply by over 6,000-8,500 units of affordable housing annually for the next ten years if we are to make room for the people who want to live and work in our community. If we want to extend that period to twenty years, we need 3,000-4000+ units annually to reach our goal. This will require new approaches.

If it wasn’t for some quick analysis of the City’s shoddy work, those crazy numbers (the entire housing economy produced around 4,000 units; that’s the entire production!) might have stuck. The City tipped the scale by not counting existing subsidized units and voucher programs.

The City has betrayed common sense and is now just manufacturing data to prop up bad policy. It’s a pretty disgusting mess at City Hall. I’m not sure how these people sleep at night.

You can read Person’s whole story for more, but the truth isn’t the only victim. The City’s bad policies and bad data are propping up the runaway train of Mandatory Inclusionary Zoning (MIZ) and the real victims are people who will see their housing costs going up and up while the City makes things up to explain why builders are to blame. Just another day at the office for bureaucrats at the City.

 

Affordable Seattle: Magical Thinking Meets Brute Force

I discovered something this weekend, a new website created by the socialist party in Seattle called Affordable Seattle. What would be funny if it wasn’t so serious is how wrong the website is about who is actually running Seattle. The website is sort of Orwellian in its narrative of “big business” and promising that if Jon Grant and Nikkita Oliver are elected to office that things will get better because of some sort of redistributive scheme. The site’s tag line about “people not profits” is not only trite, but is a false dichotomy; I suppose Sawant would have people who build housing work for free? And developers and landlords aren’t running the city; if we were would we have Mandatory Inclusionary Zoning (MIZ) and legislation forcing landlords to help tenants register to vote? Here’s Affordable Seattle’s “solution” to the problem of high prices:

  • Massively Expand Affordable Housing
    Build tens of thousands of quality city-owned homes, paid for by taxing big business.

  • We Need Rent Control!
    As a first step, require at least 25% of new private sector development to be affordable. Organize a movement for tenant collective bargaining rights to lower rents.

  • Make Landlords Pay for Economic Evictions
    Stop the displacement of low-income households! When renters are forced to move due to major rent hikes, landlords should be required to pay moving costs.

First, I have no problem with the City of Seattle building subsidized housing on its own property. In fact, we’ve touted this idea before because the City could easily create thousands of units this way. The problem is the Councilmember Sawant has done exactly nothing to advance this. Zero. Nothing. She asked for a study and the City staff produced a desultory report essentially shrugging and saying using City debt to build on City owned land was just too hard. They responded to the proposal like a twelve year old would to a command to clean his room: “C’mon! I don’t wanna!” I urged Sawant to get an independent and outside consultant to run the numbers. She did absolutely nothing.

Rent control is an incredibly bad idea as we know, but at least the socialists acknowledge that the MIZ scheme is a form of rent control. They just want more control which is why they want an inclusion rate of 25 percent. And as I pointed out last week, there just isn’t any evidence to support the notion that there are massive numbers of people being forced out of their apartments. In fact, the United States Census data from the American Housing Survey show that only 6 percent of people who moved in the metro area cite “forced out” as the reason for their move.

That is dead last, and keep in mind that respondents to the question could cite multiple reasons. The notion that people are being “forced out” just isn’t supported by real data.

But the funniest paragraph on the website is this one:

City Hall is dominated by corporate developers like Vulcan, owned by billionaire Paul Allen, landlord lobbyists, and the Chamber of Commerce. They are profiting off the affordable housing crisis. To protect their profits and block popular demands for affordable housing, they are spending big on city elections to maintain their political control. To make Seattle affordable, we need to break the corporate stranglehold over City Hall by organizing our neighborhoods and electing our own candidates.

The Chamber? Insert laughing-till-I-cry emojicon here. The notion that the Greater Seattle Chamber of Commerce has any influence on the outcome of this election is absurd. Over the period of time that Sawant has been in office the Chamber has ceased to function as anything other than a booster for tourism for the city. That’s important, but their effect on issues related to wages, work hours, tenant regulation, and housing development has been zero. And an endorsement from them in Seattle probably loses as many votes as it gains.

But the site is correct that Vulcan does control City Hall, at least when it comes to the execution of the Grand Bargain. Mayor Ed Murray looks over his desk and sees “the development community” when he sees Vulcan lobbyists, even though Vulcan builds a teeny tiny percent of new housing in Seattle. Still, they wrote the numbers into the Grand Bargain that we all have to live with now. And landlord lobbyists? Jamie Durkan in an interview with George Howland said what we’ve known for years, City Hall is in the bag for the socialists. Land lords aren’t even consulted just to say they were when the City Council passes legislation.

Yes, it’s true that Jenny Durkan is raising lots of money, but she’s far from being assured election because of money. Polls show her in the mix, but not dominant. If anything, you’ll see Durkan starting to mouth the socialist party line in oder to neutralize charges that she’s a corporatist. It’s what politicians do. Just look at the wide eyed City Councilmembers who do Sawant’s bidding without much question other than to passively aggressively complain that, “Some people say that we’re corporatists, but those people would be wrong,” just before they vote for the latest Sawant scheme.

Councilmember Sawant is not a politician, she’s a performance artists. Like Donald Trump its all about telling a good story about the corporations and the greedy developers and landlords and getting big cheers. That’s all. She doesn’t have the first clue about policy and how to make it or implement it. It’s not that she’s stupid, but she’s a performer looking for audience approval. If policy gets made from her story about the Chamber running City Hall, that’s just great. But it’s all about the applause lines, not solving real people’s problems. If only her 8 colleagues would get that the screaming mobs in their faces are just that: a mob. Ignore them. But they just don’t have the courage.

Fighting Racism in Seattle Means Building More Housing, Not Less

[They’ll] make you think that they’re doing you a favor. Some of you asked me today about the Oakie Doak, well that is a classic example of the Oakie Doak. And what is the Oakie Doak? A thing, a promise given as if it has great value when in fact it is useless, always designed to deceive, given mostly, but not always, by posturing, pontificating, and picture taking politicians.

Thomas N. Todd
Civil Rights Attorney
Addressing the Ohio Education Association in 2008 on the hazards of non-educational “experts” being recruited to teach in public schools

The other day an article from the Seattle Emerald appeared in my Facebook feed, South End Residents of Color Clap Back at the Times. I resonated with the opening paragraph of the post.

Welcome to Seattle where the rich get richer, Blacks get pushed out, and the Seattle Times prints lazy, racist articles about the South End where many of the city’s remaining People of Color live.

I’ve resisted using the word “lazy” to describe the manifest failure of the Seattle Times to do its job as a daily paper when it comes to covering growth and change in Seattle. How about desultory? The Times just doesn’t know how to see growth except in the most cartoonish terms, and I agree with this writer that the changes in the city’s demographics can’t be summed up the way the Times often does, as an opportunity to panic and fret about changes associated with growth.

But the author commits the same mistake while criticizing the Times when she says that, “Blacks get pushed out.” But she’s not alone in making this statement and when it comes to growth and change the notion that Seattle is in the process of ethnic cleansing is almost never challenged. That’s because, let’s face it, Seattle is a predominantly white city, and most of the people involved in discussions about growth are, in fact, white. When challenged they simply can’t respond for fear of being called racist.

I don’t have that problem. As a person of color, I have long been appalled at the way race is used to promote counterproductive policies in the city when it comes to housing. We have zero quantitative definitions of gentrification and displacement but our answer, as a city, to these poorly defined notions is to limit housing production, tax it, and impose a new form of redlining in areas that the City designates as, “low opportunity.” And, not incidentally, most of the people upset and gesticulating wildly about displacement and gentrification are, you guessed it, white single-family homeowners. Let’s look at three charts of census data.

First of all, as a city, we are becoming less white. The overall percentage of white people dropped by 1 percent, and that means that we have slightly more people of color in the city than we did five years ago. Yes, Black people are fewer as a percentage of overall population, but their overall number is about the same. It’s tough to argue that Black people or people of color are fleeing the city based on these numbers. In fact, the city is sort of staying more or less the same with some tilt away from whiteness.

But what about Seattle’s south end, specifically neighborhoods like Columbia City and Rainier Beach? Well that second chart is for zip code 98118 and includes both of those neighborhoods. Yes, it’s true that the actual number and percentage of Black people in those census tracts has fallen by about 2,000 people or 4.7 percent, and there have been, over about the same period (2011 – 2015) about 2,300 white people.

But before I say anything about that, look at what’s happening in the north Seattle neighborhood of Lake City, zip code 98125. You’ll see that the real number of Black people has increased significantly, by 1,384 while over the same period there are 439 fewer white people. By percentage, the drop in white people in Lake City, 6 percent, is greater than that of the drop of Black people in south Seattle.

So what’s going on?

We simply don’t know.

One damaging and sort of hopeless narrative is articulated in the first paragraph of the post I started out with: Black people, 2,000 of them, have been forced out by 2,300 white people. This story is all about opportunistic white people willfully squeezing out poorer but established Black families, opening up fancy coffee shops and restaurants, and wiping out the culture of the neighborhood to make it more white. Where are those Black people going? They are moving out of Seattle, and the city is becoming more and more white.

Who benefits from the status quo and not building more housing? Single-family homeowners who will see their investment “skyrocket” in value because demand is increasing and supply for new housing options isn’t keeping up. And guess what, those homeowners are mostly white.

OK.

Or, maybe many of those Black people moved to Lake City. Would anyone argue that those white people in Lake City were, “displaced” by Black people? Is Lake City undergoing a de-gentrification? And where did the 359 Native Americans and Asians go between 2011 and 2015? Were they forced out by the influx of Blacks into the neighborhood?

Why in the world would we conclude these things based on so little data? This hopscotch of conclusion jumping has currency because it serves a larger, anti-housing and counter productive narrative about race and growth. The story is about ethnic cleansing, victimization, and keeping the status quo. But who benefits from the status quo and not building more housing? Single-family homeowners who will see their investment “skyrocket” in value because demand is increasing and supply for new housing options isn’t keeping up. And guess what, those homeowners are mostly white.

We could probably figure out why people of various income levels, races, and other designations have moved or are moving. We could go door to door, recruit people to participate in a years long study and track their movements, ask lots of questions, and measure dozens of variables like gross income, wages, inflation, regional demographic trends, and a host of others. We could establish control groups. We could spend millions to pinpoint exactly why the south end has lost black people and Lake City has gained black people. Or we could just believe its about ethnic cleansing because that supports what we’ve already concluded: things are bad because people from the outside are pouring in to steal from us and make life worse.

Or we could all work together to build more housing, of all kinds, in all parts of the city, for all levels of income. White people who don’t want change are exploiting people of color in Seattle ruthlessly, using the challenges faced by people with less money and fewer resources as an excuse to preserve their own hegemony and wealth. Data actually support this conclusion : as supply drops, price goes up, people with less money who are disproportionately people of color, can’t compete for existing housing.

Even our suffering and poverty is taken from us to benefit people who already have money, wealth and dominance

There is simply no data, none, zero, nada, that supports a narrative that white people are willfully forcing their way in to any neighborhood and forcing black people out. Ironically, that story and the “solution” for it of building no more housing in the south end or taxing it only makes prices higher and actually accelerates the problem all poorer people face when looking for housing. It’s actually a form of redlining that masquerades as noblesse oblige.

People of color in Seattle, when it comes to housing in particular, are not being served by arguing for interventions that make it harder to build more housing. We are not helped demographically or economically or culturally by banding together with know nothing neighbors who say that new housing is racist. We, in truth, being once again exploited and taken advantage of to benefit the dominant culture; even our suffering and poverty is taken from us to benefit people who already have money, wealth and dominance.

This is already a long post, but I am going to quote from a Ta-Nehisi Coates who quotes this passage, a lament by Private Thomas Strother of the United States Colored Troops, (I first heard the quote watching Death and the Civil War):

To suppose that slavery, the accursed thing, could be abolished peacefully and laid aside innocently, after having plundered cradles, separated husbands and wives, parents and children; and after having starved to death, worked to death, whipped to death, run to death, burned to death, lied to death, kicked and cuffed to death, and grieved to death; and, worst of all, after having made prostitutes of a majority of the best women of a whole nation of people . . .would be the greatest ignorance under the sun.

Last week a black woman in our city called the police for help because she thought someone was trying to break into her apartment. She likely was afraid and troubled enough she grabbed a knife, and was holding it when she answered the door (many of the facts about this and what they mean are still in dispute). Seattle police shot and killed her in front of her children. Would they have done the same to me? Probably not. I’m not black.

We’re not going to get over or solve the scourge of slavery in my lifetime. In fact, there are people, many people, alive today that lived in an America in which to marry, or use the same water fountain, stay in the same hotel, or live in the same neighborhood as a white person was illegal and could result in death. Do you think we’re over that yet? We’re not. Racism is real and alive and well right around the corner. Your corner. And you might even be racist yourself.

But the notion that the development and construction of new housing in our city is racist or contributes to displacement or harms people of color or people with less money to spend is the opposite of what we know about economics. We’re being played, and played hard. The best thing for people of color and poor people to do is demand more and more housing and to seek out every opportunity to build housing ourselves, in our own communities and everywhere else. That’s the only way we’re going to make this city a safe and prosperous place for everyone who wants to live here.