Murray's proposal requires affordable units in new multifamily buildings

SEATTLE — Mayor Ed Murray sent legislation to the Seattle City Council Wednesday to bring the city one step closer to requiring developers of multifamily buildings to include affordable units in those structures. Developers would either include them in the building, or pay a fee to the city for the construction of low-income housing elsewhere.

The legislation is one part of the many recommendations from the mayor’s housing affordability and livability agenda.

KIRO 7 asked for specific numbers on the percentage of units required to be at below-market rates, and how much developers could pay to avoid that.

City staff said depending on the neighborhood, about 5 to 7 percent of units would need to be affordable to people making 60 percent of area median income. In 2016, that equates to about $38,000 a year for a single person, or $54,000 a year for a family of four. The rents should be about a third of their paychecks.

As for the fee in lieu of such units, the city has not publicly stated exact dollar figures, except to say that the amount would be tied to the square footage of the entire building.

In exchange for the requirement, developers would get to build taller structures, resulting in the rezoning of 44 percent of city land.

City staff told KIRO 7 that developers of downtown structures, which tend to be high-rise, concrete buildings, would more likely take the option of paying the fee. That’s because the cost of keeping some of those units at cheaper rents would be much more drastic than the cost of doing so in a wood-framed structure with fewer stories in another neighborhood.

Maria Barrientos, a developer, said she has used other existing programs already to incorporate below-market units in all of her buildings.

“The diversity of people in a neighborhood always makes the neighborhood better,” Barrientos said.

She said that the additional rental revenue coming from the additional story she could build would cover the cost of the lower-rent units required by the city.

“You get to a net zero.  And that’s why it works,” Barrientos said.

But Roger Valdez, who represents other developers through Smart Growth Seattle, said that costs vary by neighborhood.

Valdez said for the developers he works with, the math has not penciled out.

“Building more is not free,” he said. “In order to build that extra height, that’s additional cost, and then you lose money from the rents you have to lower.”

The City Council will need to look at details and numbers for this plan over the next several months.

Cox Media Group