NIMBYs (and a Legislator) are killing the economy

Matthew Yglesias  at Vox has written an important response to an article in the New York Times about how housing is holding back economy. The author of that article spends lots of time on people being hesitant to buy houses, but Yglesias points out that in cities like Seattle housing isn’t being built fast enough which means fewer jobs and less money in the local economy.

Yglesias says the real drag is the anti-housing movement trying to slow housing development.

A significant swath of America is facing a housing affordability crisis, and simultaneously the country is facing a massive economic slump largely driven by a depressed level of housing construction. Opening up the spigots of development in high-priced, high-demand areas could considerably reducing housing affordability problems and create a ton of new jobs in the construction sector and related fields. But most the areas of the country where housing demand is strongest are generally the areas most politically dominated by left-wing people who are reluctant to embrace a deregulatory agenda.

In Houston, for example, where zoning and regulation is less strict a lot more housing is getting built than in San Francisco. I’m not advocating that we try to emulate Houston’s growth patterns, but we certainly want to do the opposite of what San Francisco has done which is over regulate housing. Now that city is 100,000 units behind where is should be considering the demand for housing there.

And as if to help prove Yglesias’ point the anti-housing movement in Seattle will be hosting an NIMBYpalooza on the evening of April 30. The Coalition for an Affordable and Livable Seattle is massing their troops to talk about ways to slow down new housing development. This group even wants a moratorium on new housing. The event is billed this way:

It’s a rare opportunity to meet and share ideas with likeminded folks from across Seattle. We hope you can make it – in fact – we need you if we are ever able to effectively organize a movement to respond to these forces threatening Seattle’s livability and affordability

Guess who’s part of the anti-housing movement now. Representative Gerry Pollet will be speaking to the group.

You’ll also hear from State Housing Rep. Gerry Pollet from Seattle’s 46th District, a leader in Olympia supporting our letter and the call for managed growth. He’ll give his reaction to unmanaged growth and tell us what he’s doing down in Olympia to address the problem especially lack of adequate notice to our neighborhoods when land use changes occur, and take your comments.

Rumor has it that Representative Pollet may be running for City Council in one of the newly formed Council Districts. This would explain his grandstanding on small-lot legislation. Pollet’s embrace of the anti-housing movement is and his legislation are another perfect example of why housing prices continue to climb; more rules, more process, and more costs.

If Pollet has his way every Lot Boundary Adjustment in Seattle could be subject to costly appeals. Who pays those costs? First to pay are the City taxpayer and the developer. The taxpayer foots the bill because the appeals are against the City. These appeals are almost never successful, but the developer sees her costs go up as she waits for the appeal to unwind and that means higher housing prices. The City pays legal fees and loses tax revenue and jobs when projects don’t get built, all so Pollet can score some points with wealthy existing homeowners.

But who really suffers and pays for Pollet’s political play for his wealthy and litigious constituents? People looking for new homes, who will have to wait longer and pay more for housing. This hurts the economy in lost construction jobs and tax revenue if projects don’t get built.

Yglesias is right. But it isn’t just about not supporting deregulation. In Seattle the local economy is being attacked by people who got here first who already own homes and want to shut the city’s gates to new people. The City Council has made some questionable decisions about housing regulation, but now one State Legislator is trying to make things even worse by teaming up with NIMBYs to stymie the development of new housing.

Email Representative Pollet at pollet.gerry@leg.wa.gov and ask him to stop playing politics with Seattle’s housing economy.

Growth in Seattle: An Introduction

Last Saturday Smart Growth Seattle was fortunate to have the board of the Osprey Foundation visit for a tour and introduction to growth issues in Seattle. We didn’t have a lot of time, but we covered some good ground. This is the introduction to the tour and the stops we made. The tour, as it turns out, highlights the positive aspects of growth in the city that we’ll continue to highlight. While these projects seem high end and glitzy, they actually combine accessibility, efficiency, sustainability, and preservation. These projects give us a glimpse what Ideas for Change: Seattle’s Housing Future can look like if we encourage them. 

Seattle is a place people want to live and work. Like the Bay Area, Seattle is rapidly becoming a center for job creation in the tech and ancillary fields. By 2040 Seattle’s population will have grown by 32 percent, roughly half a million new people.

All this growth is causing some serious anxiety among people who already live here. Worries about traffic congestion, housing price, and resource allocation are increasingly occupying the time of local elected officials and planners who are trying to respond to growth.

The problem in Seattle is that while we have a mandated comprehensive planning process, we haven’t been able to develop an agenda for growth that has been consistent. Instead, Seattle City government has responded to issues on an ad hoc basis, and often on a lot-by-lot, block-by-block, crisis-by-crisis way.

A previous regimen of neighborhood planning fell into disuse in the early part of the last decade. Since that time neighborhood groups have shifted their attention away from “how we grow” to questions about “whether we grow.” This movement of slow or no growth has merged with anti-corporate sentiment inspired by the occupy movement. What has resulted is a very vocal group that is highly suspicious of growth and urging local elected officials to go slow, and impose restrictions on new housing and job growth.

Ironically, this movement to clamp down on housing supply is in the name of affordable housing. The view has emerged from this group that all the new housing is actually driving the prices of housing up, even though there is no data to support that. Quite the opposite: housing growth in the middle level income range has created a small housing surplus which has kept that housing within the limits set by the Department of Housing and Urban Development (HUD).

South Lake Union is the flashpoint for this debate, although it is playing out all over the city. The projects you will see on the tour are emblematic of the great potential to grow sustainably and efficiently. However, this growth is often seen as rapacious, disrespectful of local culture and the history of the city.

What I hope to show today is a glimpse of our vision of how we can build new, innovative office and housing projects that fit well into our past and our future, and that, given the constraints of land, economics, and climate change, we really have no choice but to grow in this way.

Smart Growth Seattle at We Work, South Lake Union

500 Yale Avenue North

WeWork is a platform that empowers small businesses to succeed by making them more connected with each other. Our services make running a small business easier and allow freelancers and entrepreneurs to focus on what they do best. Our people, our work space & our technology are all dedicated to inspiring creativity, productivity and innovation. We constantly strive to make meeting new people and having interesting conversations seem obvious, natural and effortless.

Stack House Apartments, South Lake Union

1280 Harrison Street

The Stack House Apartments are on a full city block in the South Lake Union neighborhood of Seattle. The Stack House project combines two new mixed-use residential projects with the restoration and adaptive reuse of the Supply Laundry Building, a historic landmark.

Supply Laundry was made a landmark because it is a unique example of commercial laundry facilities dominant in the first half of the 20^th century. Supply Laundry was one of several laundries in South Lake Union including Troy Laundry, also the site of a new development and adaptive reuse.

The full block development is broken into a series of smaller, quarter-block masses more characteristic of the neighborhood. Pedestrian-oriented mews create north-south and east-west through-block connections that preserve view corridors to Seattle landmarks and guide residents and passersby into the public plaza and courtyard spaces.

The Bullitt Center

1501 East Madison Street

Denis Hayes on the Bullitt Center

Arguably, our chief innovation is that we brought all these ideas together in one place at the same time. The Bullitt Center — instead of pursuing just net zero energy, net zero water, net zero carbon, composting toilets, toxic-free materials, an enticing stairway, 80+ percent day lighting using high-performance windows — chose all-of-the-above. And we chose them for a six-story urban infill project in a dense neighborhood in one of the greatest cities in the world, Seattle.

Our goal is to drive change in the marketplace faster and further. Three years ago, a solar-powered, six-story office building in cloud-covered Seattle would have struck most people as not merely foolhardy but impossible. Today it exists. To really change a market, the economics of the project must support it. Today’s reality is that economic policy promotes environmental decay.

While we work to repair these market failures, we have to operate in the world, as it exists, not as we wish it were. We estimate the Bullitt Center cost about 23 percent more than a typical class-A office building in Seattle. When it is fully leased, we expect the building to be cash-flow positive. While the initial financial returns will not be as great as if we had merely built it to code, leased it, and flipped its ownership to a REIT, we expect the Bullitt Center to perform over time at least as well as other fixed-income investments in the Bullitt Foundation’s portfolio.

Dwell Passivhaus projects in Rainier

3153 S. Oregon St

Dwell Development’s Passivhaus is the first in-fill spec Passivhaus development in Seattle. This high-design approx. 2,000 square feet, 3 bedroom, 2.5 bath features signature Dwell finishes, clean lines, volume, a 15’ by 24’ roof top deck and a large private parking space. Located in Dwell Development’s celebrated 15 home micro-community just blocks from Columbia City shopping and dining and the Light Rail Station. According to Tadashi Shiga, of Evergreen Certified, third-party verifier “the Passivhaus is the highest efficient home for energy efficiencies in the World. It’s 90% efficient. It’s like getting a 90% off space heating and cooling bills”.

 

 

The Solution to “Gentrification?” Less Guilt, More Housing!

I’ve always understood the sentiments behind concerns about what people call gentrification, but I have never had those feelings myself. Even worse, I’m not sure I even understand what other people mean by what they call gentrification. When I ask for a definition or look for one, there are many and they are almost never quantitative. Usually, the word is a code word: a term that we’re all supposed to intuitively understand. Daniel Hertz worries about being a gentrifier himself, and he writes in the Atlantic Cities Place Matters that

We tend to carry a lot of guilt about our living arrangements. We have a lot of conversations about whether or not it’s acceptable to live in our current neighborhood, or the one we’d like to live in. Sometimes, we reassure ourselves by discussing the obviously graver transgressions of the people who live in some other neighborhood, which has accumulated slightly more bougie coffee shops and restaurants. Sometimes we find solace in some part of the continuum of gentrification that we’re comfortable with: the very beginning, when you can kid yourself that your presence isn’t changing anything; or when the tipping point has tipped, and the damage has already been done.

Exactly. Worries over gentrification tend to be all about race, geography, and guilt. And there is almost no way around the idea that trying to stop racial and economic change in a neighborhood ends up being reverse red lining like the ridiculous assertion in a Puget Sound Sage report from a while back that said the Rainier Valley should remain “majority minority.” I responded to that idea in a Crosscut article that got me in a lot of trouble with some people.

Racism exists in our society and we should seek to end it and reverse its impacts. Poverty exists and we need to figure out how to better create economic opportunity for everyone. But locking a neighborhood into a permanent ethnic mix? That’s an extreme idea, and one that I suspect the authors of the Sage study might want to attenuate, rethink, or rephrase.

They refused to step back from that language. The truth is that neighborhoods change, they get wealthier, then poorer, then wealthier again. Buildings rise and fall, old timers fade away, and new old timers take their place. That ugly sign everyone hates, or that restaurant that everyone says is a dive, may end up being the neighborhood “character” everyone tried to save when new housing arrives.

Hertz realizes this, and in his post resolves the issue like this.

We need to recognize what’s really going on: that what we call “gentrification” these days is only one facet of the much larger issue of economic segregation. That people get priced out of the places they already live in is only half of the problem. The other half, which affects an order of magnitude more people, is that people can’t move to the neighborhoods to which they’d like to move, and are stuck in places with worse schools, more crime, and inferior access to jobs and amenities like grocery stores. That problem is easier to ignore for a variety of reasons, but it’s no less of a disaster.

And all this, in turn, is the result of a curiously dysfunctional housing system – one that’s set up to allow market forces to push up prices without regard for people who might be excluded, and to prevent market forces from building more homes and mitigating that exclusion [emphasis mine].

The answer (to the extent that there needs to be one) to gentrification is more economic opportunity for everyone and more housing choices for everyone. Hertz almost certainly wouldn’t entirely agree with me, but the guilt associated with success or with buying a new house in a “bad” neighborhood shouldn’t influence public policy. That’s an issue that should be handled by a therapist.

However, the notion that the best response to that guilt should be tightening regulations around new housing  only makes the problem worse. And advocates like Puget Sound Sage get themselves throughly confused, advocating on the one hand for racial segregation in the Rainier Valley, but then crying racism a the suggestion of putting affordable housing there. People should be able to live wherever they want, and when they can’t because of price, it’s usually because we’ve over-regulated the market to try, ironically, to lower prices. This ends up excluding people, especially poor people. Hertz is right, we should be, as a city, putting our energy into “building more homes and mitigating that exclusion.”

Labor Takes a Vacation

Street and alley vacations can be a fraught affair these days. A vacation is when a private developer purchases public right of way to build on, under, or over. A parking lot under an alley way, for example, is a subterranean vacation. But it’s not just a sale because there has to be “public benefit.” The problem is that various groups, especially labor unions, are starting to hold up projects claiming that their interests are the same as the public interests. The problem is not that labor is trying to make this argument, but that the City, once again, is responding to the loudest voices right in front of their faces without thinking about the broader implications for land use and housing policy in the city.

Here’s the process from the Seattle Department of Transportation (SDOT) website:

Street vacation decisions are City Council actions as provided by State statute. There is no right under the zoning code or elsewhere to vacate or to develop public right-of-way. In order to do so, a discretionary legislative approval must be obtained from the City Council and, under law, the Council may not vacate right-of-way unless it determines that to do so is in the public interest. Part of that determination is to insure that potential development and use of the vacated right-of-way would be in the public interest. This determination may be guided by established land use policies and standards as called for by the street vacation policies, but the Council is not bound by land use policies and codes in making street vacation decisions and may condition or deny vacations as necessary to protect the public interest.

Two alley vacations have attracted some attention over the last year. In West Seattle Mayor McGinn played election year politics with a vacation for a development with a Whole Foods in it. The Mayor said that,

We have a strong commitment to social and economic justice at the City of Seattle. One of our core economic development goals is to provide fair and livable wages and benefits for our residents.

Earlier this week the Seattle City Council approved, fortunately, the West Seattle alley vacation anyway. Here’s the coverage from the West Seattle Blog:

Rollcall vote: 6 yes, 3 no. The alley vacation petition is approved. Rasmussen offers closing words that the development will upgrade what is currently a “bleak” site. He also thanks everyone for public involvement in the extensive process. The “no” votes are Mike O’Brien, Nick Licata, and Kshama Sawant; the “yes” votes are Tom Rasmussen, Sally Bagshaw, Tim Burgess, Bruce Harrell, Sally Clark, Jean Godden.

The “no” votes said it was about various reasons like truck access and the negative impact on pedestrians. But it’s hard to take that seriously when the union was out in force talking about wages and the United Food and Commercial Workers gave McGinn $50,000 in campaign contributions. In my view, the neighborhood concerns were of the standard red herring variety. But the union was clearly out to either unionize the Whole Foods or keep competition out of the neighborhood.

Across town, labor has also been flexing it’s muscles in another dispute over an alley vacation. This time they seem to have stymied the developer. Because of pressure from labor over the vacation over the same wage and organizing issues, the developer is skipping the vacation. Without it, the project will be smaller and have no affordable housing.

Under the new proposal, the hotel would have 1,280 rooms and take up only three-quarters of the block between Howell andStewart streets and Eighth and Ninth avenues. Hedreen would prefer to build a 1,685-room project on the entire block. The smaller project lacks many of the amenities of the larger development. It would not have 156 units of onsite affordable housing, and there’s no public park along the length of Ninth Avenue.

The labor advocates said this about the project and the jobs it would create:

The project will employ over 1,000 workers (over 700 will work in the hotel). However, the jobs will likely be low-wage, no benefit jobs with unsafe working conditions.

Clearly when labor talks about benefits they mean wages and benefits for their workers. With the long drawn out process created by controversy over public benefits the safest thing to do for the developer was to make the project smaller. So there will be fewer amenities and no affordable housing. A project that would have actually created affordable units on site now will have none. How’s that for public benefit.

I have no problem with unions trying to use the public benefit process to make the case for increases in wages or even the number of members in their union. That’s what unions do. But because of the amount of money they spend on political campaigns and worry over reelection, politicians have a tendency to do exactly what the vacation process intends to avoid: holding projects hostage to every single claim made by specific interest groups claiming public benefit. Why doesn’t the City show leadership and facilitate a discussion between labor and proponents of proposed projects to find mutually beneficial solutions rather than hiding the real issues, wages and benefits, behind design committees and NIMBY red herrings?

The two parties that need to negotiate over wages and union membership are employers and unions, not developers and the City, especially when there is additional housing supply at stake. Turning the street and alley vacation process into a labor negotiation doesn’t make any sense, especially when builders don’t have control over the wages paid by tenants of the their buildings. And even if they did, the City should not be holding up vacations while that gets worked out, especially when it adds additional costs to housing or worse still, reduces the number of units that get created. But the City could discuss wages and benefits in a more appropriate forum.

Don’t we have enough efforts underway to tax, regulated, and limit housing? Unions perform an important function, especially when they represent lower wage workers. But allowing unions to start using the vacation process to try to get higher wages will result in developers avoiding the process which will take away any leverage the City has to create public benefits (which should be for the widest possible number of people) in exchange for the right of way it’s giving up. This is a bad precedent that the Council should not set. They did the right thing in West Seattle but their lack of movement on the Hedreen has cost the city affordable housing.

On Urban Density: We’re Not All Goldilocks

This post originally appeared on Better Institutions on April 20, 2014.

Goldilocks is the story of a selfish young girl who breaks into another family’s home, eats their food, and destroys their property. She has a very self-centered perception of what’s “just right,” and she’s perfectly willing to trample on the rights of others in her quest to acquire it. It’s fitting, then, that some authors have made reference to Goldilocks when writing about how cities “should” be built. But in their view it’s not the little girl who’s the monster, it’s the Three Bears and their divergent, inharmonious tastes. There’s a proper urban density just as surely as there’s a proper porridge temperature, and if you don’t like it, well, you can go live with the bears.

Here’s one take, from the Guardian’s recent piece, “Cities need Goldilocks housing density – not too high or low, but just right“:

There is no question that high urban densities are important, but the question is how high, and in what form. There is what I have called the Goldilocks density: dense enough to support vibrant main streets with retail and services for local needs, but not too high that people can’t take the stairs in a pinch. Dense enough to support bike and transit infrastructure, but not so dense to need subways and huge underground parking garages. Dense enough to build a sense of community, but not so dense as to have everyone slip into anonymity.

Other authors have written similarly prescriptive articles, with titles like “Mid-Rise: Density at a Human Scale,” which makes the case that density is important, but that too much density can be harmful. Or “Why I Miss the Suburbs,” which consists of a woman who lives in New York City complaining about all the things she misses about the suburbs. Or here’s a local Seattle man offering his feelings on micro-housing: “I don’t think most people want to live next to a boarding house with itinerant people living in it.”

Putting aside the loaded language of that last quote, what each of these share is the belief that there’s a “right” way to build cities. In their view there’s a balanced amount of development — somewhere between two-story dingbats and 80-story skyscrapers — that will make everyone happy. This mindset is no less destructive than Goldilocks herself, but on a scale far beyond at of a single household’s personal property.

Most people probably don’t want to live in a city full of skyscrapers, but some surely do. Manhattan is a real place, after all. Not everyone wants to live in a sprawling, suburban neighborhood either. Some people enjoy the anonymity of the big city, others hate it. To state the very obvious, different people are different. They like different foods and different cars, or they don’t like cars at all; they have different political ideologies and appreciate different art; and they enjoy different urban environments to different degrees.

No one is forcing these people to be here! Photo by Bon Adrien.

Imposing my values to ensure that only a specific type of urban environment exists robs others of the opportunity to find their own Happy City. Unlike Goldilocks, who breaks some dishware and a chair or two, successful NIMBYs are taking away entire homes from people who would like to live in their city — they remove those potential homes from the market, and they drive up the cost of living for everyone else in the process. There’s something to be said for incrementalism, but arbitrary limits to density, excessive parking minimums, and other rigid regulations that define which forms are acceptable (and, more to the point, which are not) cost us dearly: lost productivity, overpriced housing, air pollution, sprawl, poor health and obesity; the list goes on and on.

In cities — places known for accepting and celebrating diversity — it’s amazing that we have to fight over what kinds of housing are appropriate and not. If it’s safe and clean, and someone wants to live in it, that should resolve 90 percent of the issue. They should have the right to live as they please. Community input should play a role, including on aesthetic matters, but arguments that “I wouldn’t want to live there” have no place in the discussion,especially when those homes are maintaining vacancy rates of approximately zero. If no one wants to live there, no one will, and you’ll be unlikely to see that type of housing again any time soon.