Mayor proposes ordinance to require all new residential multifamily developments contribute to affordable housing

Mayor Ed Murray today unveiled his proposal to enact a residential Mandatory Housing Affordability (MHA-R) program, which will require that new multifamily residential development in Seattle contribute to affordable housing, either with affordable homes in the building or payments to help construct them throughout the city.

The measure is the next step of implementing the Grand Bargain, an agreement between affordable housing advocates and private developers that will create an estimated 6,000 affordable homes in Seattle over the next ten years.

“As Seattle grows, we can ensure that people of all backgrounds can find affordable homes in walkable, livable neighborhoods,” said Mayor Ed Murray. “Everyone who works in Seattle should be able to afford to live here. We will continue our community engagement process to find the right balance for businesses, residents, and advocates so that we are smart about how and where we grow.”

“The Mandatory Housing Affordability framework is an innovative, permanent solution which will provide our city with a continual source of new affordable housing,” said Councilmember Rob Johnson. “We owe this not just to our current residents, who are struggling with increasing housing costs, but to future residents who will benefit from the units we create today and tomorrow.”

“As rents climb, people face the prospect of displacement or even homelessness, and this component of the comprehensive housing affordability strategy is essential to keeping lower-income workers housed in Seattle,” said Councilmember Mike O’Brien, District 6, Northwest Seattle. “I look forward to collaborating with the community as we move toward implementation of this mandatory housing affordability program.”

Key features of the MHA-R framework are:

  • Requires inclusion of affordable housing or in-lieu payment to support affordable housing in zones that have been granted additional development capacity.
  • Applies any time one or more new dwelling units, live/work units, or congregate residence sleeping rooms are constructed or added to an existing building.
  • Rental housing created would serve households with incomes no greater than 60% of area median income (AMI) for a term of 50 years.
  • Ownership housing created would serve households with incomes no greater than 80% of AMI for a term of 50 years.
  • Funds received through the in-lieu payment option will be used to produce or preserve affordable housing, primarily for renter households with incomes equal to or less than 60% AMI.

The new multi-family developments will set aside five to eight percent of units as affordable for residents earning up to 60 percent of the Area Median Income (AMI) for 50 years. In 2016, 60 percent of AMI is $38,000 for an individual and $54,000 for a family of four.

“Seattle is my home and I am seeing many in my community being forced to leave.  Some are planning for it and some are barely holding on,” said Casey Gifford, neighborhood affordability advocate. “While our community has seen change, that change has come with less affordability.  The Mandatory Housing program will require affordability as we grow, and make some new options for those that may want to stay.”

Current market rates for a newer one-bedroom unit range from $1,399 to $1,887 in Seattle. The table below shows average monthly rent rates by neighborhood for buildings built since 2010:

Ballard $1,769
Capitol Hill/Eastlake $1,887
Green Lake / Wallingford $1,671
Queen Anne $1,694
Rainier Valley $1,399
West Seattle $1,615

In comparison, the affordable rate (30% of a household’s monthly income) for a one-bedroom unit for an individual earning 60 percent AMI is $1,017. Under the proposed MHA-R framework, rents for new affordable housing units would be set at this price.

“As a developer of market rate homes and a member of this community, I want to be a part of the solution that helps to build a more affordable and livable city,” said Maria Barrientos, principal at Barrientos Development LLC.  “I want to help create a city where hard working people can live, where my son that has recently graduated from college can afford to call home, and where the people that make up a diverse and thriving community don’t struggle to stay.  The Mandatory Housing Affordability program is a good step forward.”

The proposal released today sets up the program that requires any increase in development capacity or future changes in zoning to result in increased affordability. City planners and stakeholders will continue conversations and outreach with community members to determine what future changes may look like in their neighborhoods.

In exchange for creating more affordable housing, developers will be able to access additional development capacity in Urban Villages and Centers. Other cities in the region such as Issaquah, Kirkland, and Federal Way have already begun to use Mandatory Housing Affordability programs to address affordable housing needs.

The mayor’s proposal was developed by the Housing Affordability and Livability Agenda committee  (HALA) last year. At the core of that agreement was the creation of commercial and residential Mandatory Housing Affordability programs, requiring developers of new commercial or multi-family residential development to contribute to affordable homes. A Director’s summary of the measure can be found here. Full text of the ordinance can be found here.