Full Disclosure on Rural Washington: Giving them Hell, or Telling the Truth?

I guess it is hopeless to try and track down whether he said it, or how he said it. But Harry Truman was supposed to have been known for giving them hell. “Give ’em hell, Harry!” a supporter yelled. Did it happen? Well, Wikipedia says it did. And the idea that he responded, “I don’t give them Hell. I just tell the truth about them, and they think it’s Hell,” suits me just fine. I’m Harry Truman. I am so tired of standing up for people that really would rather just have the status quo from people who benefit from the status quo. So I give them hell. They think it’s hell. Maybe. If they care at all. Anyway, here’s my latest to the legislature on a recent public disclosure request. I think Harry would appreciate this update for legislators on a public disclosure request I did. Remember that I was castigated by the chair of the House housing committee for besmirching Kim Herman’s “honor.” I have yet to send Representative Ryu this part of the disclosure. Will she even care? 

Subject: Public Disclosure: Rural Housing

Greetings Senators and Representatives,

I wish this was an April Fools email.

However, what I am sharing is no joke.

I’ve spent more than a year trying to find some momentum to shift the way we subsidize housing in this state, something I think we need to do. With enough easing of regulation, I know that for-profit providers could meet a lot of demand. As long as the City of Seattle has a choke hold on supply and dominates the legislature, we will continue, I guess, to see more an more subsidy dollars flow there to essentially pay for their regulatory overreach. And, in Seattle, we’ll see taxation of new housing to pay for subsidized housing years from now based on data from years ago.

This is bad.

I think this is an obvious point. Others don’t. I’ve done a rather extensive public disclosure request and I am sharing these items because I want you to see that my honest efforts to address this issue have been met — it is isn’t surprising — with resistance from those most invested in the current system. Kim Herman continues to pose as a someone willing to work with you and to do what the JLARC study asked. This couldn’t be further from the truth. Herman and the Commerce Department will resist every effort to reorder the prioritization of policy and resources.

Here’s just one of his comments:

Again, not really a big shock. Of course Herman who’s been at the helm of the WSHFC for longer than any of you have been in the legislature believes he is running things just fine. So does the Commerce Department.

But how about the Director of the Yakima Housing Authority?

Nope. I couldn’t get any support there either.

Public disclosure requests can be like Pandora’s box — or a can of worms. And I’ve just started sorting through these items. It is very discouraging. Shouldn’t we all be aiming for efficiency? Housing is a good thing, shouldn’t we want more of it? Isn’t it obvious that people in rural Washington are facing a housing challenge too? When I spoke to a group of small landlords in Yakima a couple of weeks ago they all agreed: something must change.

If I knew how to give up, I would. But I simply can’t. It’s not what I learned from my grandmothers, it isn’t part of my faith, and it simply isn’t who I am. I hope this creates enough discomfort that we see some change. I am ready to help and work toward something positive if there is anyone else on the other side to reach back.

Again, let’s work on costs. Let’s work on efficiencies. And let’s keep in mind that tonight many people will sleep uneasy, if at all, because they have no housing, are in housing that is unsafe, or are wondering how they will pay rent later this week. Inflation is the greatest enemy of people in poverty and it is caused by lack of supply. Let’s do something to help these people.

Roger–

—

Eviction Propaganda is the Latest Fad on the Internet and Government

Capital Budgets Emerge in Olympia: Good News or More of the Same?

Anyone who’s worked on issues in the Washington State Legislature will tell you there are sort of two phases, policy and budget. Early in a 60 or 90 session there are lots of debates before the deadlines in each house about bills that change rules and regulations or add new ones. The second phase is about money and how the state is going to raise and spend it over the following two years. Based on the rules, the state budget has to be balanced and completed by the end of session. Unlike the federal government, there is no way to just keep funding the status quo through resolution. And the state budget has two parts as well, the operating budget which allocates money for the work of government and taxes to pay for it, and the capital budget which is bricks and mortar and borrowing (bonds) — sometimes — to pay for them. We now have a early sense of the capital budgets from both houses.

Here’s what the State Senate says it is going to do for housing with both parties agreeing (what the Senate has called a bipartisan budget).

Affordable Housing Loans and Grants ($175 million)

$175 million is provided for affordable housing projects, including $157 million for grants and loans through the Housing Trust Fund and $18 million for grants to 12 specific housing projects.

Allocations within the Housing Trust Fund include:

• $20 million for competitive awards for high quality affordable housing that will move people from homelessness into secure housing and that are less than $125,000 per unit
• $35 million for supportive housing and case management services to persons with behavioral health or chronic mental illness
• $10 million for housing that services people with developmental disabilities
• $10 million for housing that serves people who are employed as farmworkers
• $12.5 million is provided as a state match on private contributions that fund the production and preservation of affordable housing

I’m still digging into the details but this is a promising budget, putting an emphasis on a low dollar amount per unit, $125,000, on a part of the Housing Trust Fund for homelessness. On the other hand, in many ways, the allocation should be greater since this is a population that has greater needs. Putting a dollar figure on units is a good step. Now if they’d do the same on the $157,000 being allocated we’d be more impressed. And when coupled with more dollars to address a real and serious cause of homelessness, mental health (eviction is not), the first two bullets round out $55,000,000 in a promising way. And we’ve been pushing for more housing in rural Washington for years now, especially for farmworker housing. What’s the $12,500,000 for preservation. We don’t know exactly. We’re looking into it. This budget was just released yesterday.

Here’s the House Capital Budget on housing, an explicitly partisan budget, at least the way it was released earlier in the week.

Affordable Housing through the Housing Trust Fund ($150 million)

$150 million is provided for affordable housing projects under the Housing Trust Fund:

• $30 million is for housing projects that provide supportive housing and case-management services for persons with chronic mental illness;
• $10 million is for competitively awarded housing preservation grants;
• $41 million is provided for 11 specific housing projects; and
• the remaining $69 million are for competitive housing projects:
  • 10 percent for projects that benefit veterans;
  • 10 percent for projects that benefit homeownership;
  • 5 percent for projects that benefit persons with developmental disabilities;
  • and the remaining amounts for projects that benefit low-income populations in need of housing.

It’s less money than the Senate and a lot more money set aside for a very long list of specific projects. There is nothing for farmworker housing or any acknowledgement of homelessness, mental health, or any costs limits imposed. The House budget is more of the same: lots of cash for projects that want money, and only a nod to more specific needs. Supportive housing is included, something that as I said, needs a significant investment while so-called work force housing could easily be provided by for-profits if local governments would just allow that to happen.

All in all, nothing too shocking or surprising here. I am looking into a $500,000 allocation for The Morck Hotel, a possible housing project in long underfunded Grays Harbor County. Is it for housing? That’s not what I’ve heard. I’ve heard the huge non-profit Forterra wants to build a luxury hotel there. Does that make sense? It doesn’t. Grays Harbor needs housing not a fancy hotel. That line item will be an area we’ll be watching closely. And we’ll update this later as more details emerge. Budget documents are complex and not always what they seem on their face, and much will move around in the weeks ahead. We did not see big reforms made in how the state funds housing, but maybe we’ll see some incremental improvement.

Bisnow: Opportunity Zones Only Work With Lower Costs

I had the opportunity to be on Biznow’s panel last week on Opportunity Zones, a feature of last years tax reform legislation at the federal level that is supposed to encourage investment in areas struggling economically. I made the point that wound up in the headline of the story: Opportunity Zones Expose Conflict Between Growth Advocates And Neighborhood Leaders. The creation of the zones provoke the ongoing question about whether the lower costs of reducing taxes on development there will end up getting lost when neighborhoods and other interests put their hands out for exactions from new projects. Not only that, Seattle’s seriously slow and expensive permitting process doesn’t help. In spite of evidence that the City is trying to expedite permits for Opportunity Zone projects, I’m skeptical that they an make it happen. And more importantly, if we’re in a “housing crisis” why isn’t the City expediting ALL permits for housing projects.

What is an Opportunity Zone? Here’s the answer from the Internal Revenue Service the agency that manages the program:

An Opportunity Zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Localities qualify as Opportunity Zones if they have been nominated for that designation by the state and that nomination has been certified by the Secretary of the U.S. Treasury via his delegation of authority to the Internal Revenue Service.

Here’s the exchange I had about non-profits, unions, neighborhood groups that are sure to want some pay out from developers building in zones:

“You are coming into our house,” Seattle Chinatown International District Preservation and Development Authority Executive Director Maiko Winkler-Chin said. “You have to be willing to listen to what we want.”

Listening is fine, Seattle For Growth Director Roger Valdez said. But the rules have to be reasonable. He said the bureaucratic quagmire surrounding the city’s development process is bogging down growth at a time when Seattle needs it.

Of course, I was the wet blanket in the room. Everyone there was running numbers in their head and working out how the program could get their projects across the finish line or spark some new investment in proposed projects. My point was that the financing might be perfect, even optimal because of reducing tax obligations promoting investment. But if that value has to paid out in the form of wage requirements, community benefit agreements, design review, and glacial permitting timelines, then the program will grind to a halt.

I think Winkler-Chin and her colleagues are just doing their job and standing up for their community. It makes sense to me that if a project is coming into the International District that her organization would want some of the value created. The problem is that the people at City Hall don’t do math; the City Council are more than happy to cave to demands for “social justice” that eat up the benefit of the upsides in a zone. And if the project gets hit with protests or lots of negative press, then what was supposed to be an opportunity ends up being just another project in Seattle, expensive, taking for ever to complete, and diminished in it’s potential to increase housing supply with constraints production. As the President says, “We’ll see what happens.”

Representative Reeves: Speaking Up for People Who Rent Their Property

I was digging into the upcoming meeting of the Renters Commission on April 1 (ironic day for the meeting) at which the Commission will consider rent control. I don’t know what they have in mind but we opposed the creation of the Commission because we figured it would be simply a tax payer supported forum for, well, terrible ideas like rent control. I can’t imagine that the Renters Commission would consider the issue and then conclude rent control is a bad idea. We’ll see. while I was trying to see what the Commission had in store for the meeting an article from The Stranger earlier this month popped up in my search. The story was essentially an attempt to publicly shame three Democrats who voted against bad legislation that will simply make life more difficult for renters and landlords. One legislator quoted in the story, Representative Kristine Reeves made some very bold comments:

Her decision was largely influenced by conversations with her grandmother, an 88-year-old woman who used to rent out a duplex as part of her retirement plan. Reeves also mentioned a veteran in her district who told her that he supplements his income from the VA with money from renters.

“The assumption is that folks have the luxury of owning a piece of property for retiring, and that 14 days isn’t going to imperil them,” Reeves said. “But when you live paycheck to paycheck and someone chooses not to pay you—she [Reeve’s grandmother] didn’t have the luxury of coming up with the money.”

“She still has bills to pay. She’s not independently wealthy, and she doesn’t have a huge safety net to draw off of,” Reeves added, still referring to her grandmother. “What we’re doing is perpetuating a cycle of poverty for folks. That’s a cycle that I’m not interesting in perpetuating.”

I say these are bold comments because The Stranger sees itself as the arbiter of progressivism, a kind of ongoing inquisition of political correctness and lefty orthodoxy. But Reeves probably isn’t all that worried since her district is far outside the domain of The Stranger; in fact people her Federal Way district probably think The Stranger is a novel by Camus or someone that person they don’t recognize at Winco. I don’t think Reeves is too worried about The Strangers endorsement.

And when people don’t have to worry about pressure from the left, they tend to get clear headed about things like the rent and the challenges of managing rental property. So I took a moment to thank Representative Reeves.

Hello Representative Reeves,

I just read the article in The Stranger where you respond to criticism for your “No” vote.

Thank you for your vote and your brave comments.

We’ve been struggling against a dominant narrative that landlords are bad people, racist, and greedy simply because they rent their private property. As you stated so well, most people who rent their private property do so to earn a living. Managing property is work not just cashing checks.

I can say that your understanding is appreciated and a bright spot in an otherwise pretty dark time for those of us looking for solutions, fairness, and efficiency in the way we deal with housing issues.