Housing & Human Services Committee 9/10/2025

Oh.

Council member, we can't quite hear you.

You cannot hear me?

Now we can.

Thank you.

Okay.

Sorry about that.

I can't.

You know what?

I can see Chambers, but I can't see myself.

Oh, I see.

You haven't sent it.

Here it is now.

Now it says join as a panelist.

I just got the prompt.

Thank you.

All right.

We're good now?

Yes, ma'am.

Yes.

Yes.

Thank you.

I apologize.

Were you guys waiting for me this whole time?

No.

Okay, good.

Because I've been sitting here for 15 minutes, so I thought it was me.

Okay.

So, shall she kick it off or do I?

Councilman Royce, you are kicking us off.

Okay, great.

Seattle Chandler, are we ready?

Yes.

Great.

Okay.

Good morning.

The September 10th, 2025 Special Housing and Human Services Committee will come to order.

It is 9.39 a.m.

I'm Deborah Juarez, Chair of the Housing and Human Services Committee.

Will the clerk please call the roll?

Council Member Juarez.

Yeah.

Council President Austin.

Present.

Council Member Ring.

Present.

Council Member Saka.

Here.

Vice Chair Solomon.

Here.

Chair, there are five members present.

Thank you.

And again, I apologize.

When you said my name again, I thought you were asking me a question.

I'm a little rusty, so cut me some slack here.

As the new chair of the committee, I'm passing the gavel to my vice chair, Council Member Solomon, to facilitate the meeting.

And again, I want to thank you, Council Member, for taking over and chairing these meetings until we start up again in December.

Thank you.

Thank you very much, Chair Juarez.

I'm Mark Solomon, Vice Chair of the Housing and Human Services Committee, and I will be leading today's meeting as we welcome back Council Member Juarez to Council and give her and her staff time to come up to speed.

As an appointee myself, Earlier this year, I know how intense the first few weeks of doing this job can be.

And, you know, definitely appreciate your indulgence, Council Member, excuse me, Chair Juarez.

So with that, I move to adopt the agenda.

Is there a second?

Second.

Second.

Okay.

If there is no, okay, it has been moved and seconded.

Hearing no objection, the agenda is adopted.

Right.

Again, thanks to the members of the public who come to these meetings, you know, hearing that, you know, my good friend here just came from the Balkans and this is one of her first things to do is come into a housing and human services meeting.

It's like jet lagged as well.

So, good on you.

We will now open, I also want to say thank you to our clerks and our central staff for, you know, making these meetings happen.

We will now open the hybrid public comment period.

Public comments should relate to items on today's agenda and within the purview of this committee.

Clerk, how many speakers do we have signed up today?

We have five in-person speakers and ten remote speakers.

All right.

Okay, every speaker will be given two minutes.

Clerk, can you please read the instructions for a public comment?

The public comment period will be moderated in the following manner.

The public comment period is up to 20 minutes.

Speakers will be called in the order in which they registered.

In-person speakers will be called first, after which we'll move to remote speakers until the public comment period is ended.

Speakers will hear a chime when 10 seconds are left of their time.

Speakers' mics will be muted if they do not end their comments within the allotted time to allow us to call on the next speaker.

The public comment period is now open, and we'll begin with the first speaker on the list, and that's Ryan McKinster.

Afterward, we have Do you Holt, Miriam Roskin, Harley Willis, and Lori McEwen?

Please begin.

Oh, OK.

Thank you, Chair Juarez and Vice Chair Solomon, members of the committee.

I'm Ryan McKinstra.

I'm with Habitat for Humanity.

I'm their advocacy and program manager.

We're here in support of CB121-055.

For 39 years, we've worked to make home ownership possible, especially for working families here in the Seattle area.

Thanks to programs like the Housing Levy and MHA, Seattle is the easiest place currently for us to build in King County.

For affordable home ownership.

Over 200 per million affordable units are currently in our pipeline, which will serve over 1,000 people and obviously 200 families.

And that's just here in Seattle.

The 20-year tax exemption in this bill is not just nice to have, it's a difference between Aurora, one of our homeowners, an educator and single mom becoming a homeowner or being priced out of Seattle.

For a typical Habitat family, this exemption could mean $45,000 to $60,000 in savings over the life of their mortgage.

This is life-changing, not only for the families, but it allows them to build equity and generational wealth as well.

Every month of delay risks pushing projects into the next year, canceling them entirely, especially with the issues we're dealing right now.

They're causing costs to increase substantially.

The legislature authorized these changes for a reason, to give cities every tool possible to create affordable home ownership in rental properties and rental opportunities.

We encourage you to pass this bill without delay, and thank you for your time and leadership on this issue and the other housing issues I've spoken to you about before.

Thank you.

Next up we have D.U.

Holt.

Okay, next up we have Miriam Roskin.

Hi, thank you.

Ready?

Good morning.

My name is Miriam Roskin.

From 2014 through the end of 2019, I was the Deputy Director of Housing over at OH.

And prior to that, I was responsible for the multifamily tax exemption program, amongst others, at OH.

MFTE is a funny animal because, though costly, it doesn't receive any scrutiny during the budget process.

Every year you have $20 million that is simply invisible at the point that you're going through budget.

Possibly worse, the program shifts property tax burden to non-exempt taxpayers in amounts sufficient to, under other circumstances, require a voter-approved levy.

It makes a person want to ask, what are we getting for this?

Fair's fair.

At the margin, there are certainly financially feasible, on-the-bubble projects that benefit and come to fruition thanks to the tax exemption.

However, this is speculative.

It is unquantified.

It's anecdotal.

This is why the affordability component of the program matters so much.

This legislation would relax affordability levels to generate a really lousy return on investment per that November 2024 U-Dub study, about 50 cents a benefit on a dollar of cost.

In many cases, the rents would be indistinguishable from the market, and in fact, in some cases, the affordable rent would even be higher than market.

This legislation's lax affordability levels and also the elimination of the 4.5% capital rent increases add up to bad policy that I don't think would ever make it through the rigor of the budget process.

I urge you, separate from the amendments today, to fix the affordability levels, fix the rent increase limitation, or just go back to P6.

Thank you.

Thank you.

Next up, we have Holly Wallace.

Good morning, council members.

My name is Hallie Willis.

I'm the policy manager at the Seattle King County Coalition on Homelessness, and I'm a renter in District 5. I'm here to urge you to reject the proposed P7 MFTE updates, renew P6 for a year, and rethink the MFTE program to provide the level of affordable rental housing that we actually need.

Last night, I sent you a letter signed by 167 people and 18 organizations to the same effect.

These organizations include 350 Seattle, B Seattle, Downtown Emergency Services Center, DESC, Elizabeth Gregory Home, Friends of Youth, Got Green.

How's Our Neighbors.

Interim CDA.

Lehigh.

Neighborhood House.

Queer Power Alliance.

REACH Renton.

Seattle King County Coalition on Homelessness.

SHARE.

The Mockingbird Society.

The Washington Low Income Housing Alliance.

WHEEL, Washington Physicians for Social Responsibility, and the YWCA.

Additionally, after I sent you this letter last night, we had the Coalition Ending Gender-Based Violence and the Transit Riders Union also join us to sign on.

Don't rush through this proposal, which is far too expensive to have so little public benefit.

Take the time you need to work with low-income renters and other stakeholders to develop a better plan.

Thank you.

And I'll leave these for you.

Next up, we have Laurie McEwen.

Good morning.

Thank you, council members.

My name is Lori McKeown.

I run the development team at NHTSA Stegen.

I'm here today in support of MFTE Program 7. This program is one of the city's most effective housing tools, not only because it supports the production of workforce housing, but it supports the production of housing overall.

For many projects, MFTE is the difference between feasibility and infeasibility.

With some of the amendments you're considering today, specifically Amendment 9, it will also preserve thousands of affordable homes that are at risk of rolling out of the program.

I want to specifically urge your support for Amendments 1 and 5. Amendment 1 keeps affordability levels for alternative one bedrooms aligned with the current program.

This will help deliver more diverse housing types at different rent levels.

Amendment 5 allows projects that were completed in 2025 to transition from P6 to P7.

This change keeps current leases intact While acknowledging that P7 is a more accurate reflection of the current market.

It's a practical adjustment that will extend affordability.

I also encourage you to reject Amendment 2. By requiring a minimum unit size for one-bedroom units, you risk reducing design flexibility, which may lead to more studios instead of efficient one-bedroom units that provide an option that renters need.

MFTE Program 7 is vital to housing production and preservation in Seattle.

Please adopt it.

Support Amendments 1 and 5. Reject Amendment 2 to keep the program strong and effective.

Thank you.

Next up, we have Liam Stacey.

That is our last in-person commenter.

We will now move on to virtual commenters.

First up, we have Patrick Foley.

Hi, can you hear me okay?

Yes.

Patrick Foley, Yes.

Hi.

Yeah, this is Patrick Foley with Lake Union Partners.

We're a local housing, urban and historic preservation developer.

I'll start by just saying that my company, along with partners that we've worked with, have created more than 900 affordable units through the MFT program plus MHA.

And we've always performed and built the housing on site.

And rather than pay the fee, you know, think about 900 units, that's basically three high rises of affordable housing.

So it's not a small number.

My comments, I'm asking you to support the P7 updates.

My thoughts are raising the AMI level for MFT units.

It really doesn't raise rents.

It simply means more renters will qualify for below-market rents who otherwise wouldn't have that option.

MFT is the only tool that we have in Seattle that serves the middle-income renters, people above 60% AMI.

Nonprofit housing and MHA units only reach households below 60% AMI.

So for someone earning 70 or 80% AMI, which is roughly $77,000 to $80,000 a year, MFT is really their only way to rent a below market unit.

And without it, they're just stuck paying market rents, which usually runs 110% to even 140% AMI.

Just depends on the building.

So when you increase eligibility from 70 to 75%, you're not raising rent, you're expanding the opportunity.

So I ask you just please take that into consideration.

You know, you're giving more working people the ability to participate.

You know, city staff has showed participation in program six has dropped significantly, even though in 2018 and 2019, those were two of the biggest housing construction years in Seattle history.

So which this shows us something that's very important.

You know, if a program like this is not well managed or calibrated, it won't be used, and we lose the affordability opportunities.

So on top of that, there's a lot of MFT units that are about to roll off their 12-year program.

So if program seven isn't attractive enough, you know, people are going to face hiring.

So I'll end by just saying, you know, you're going to hear from organized groups today.

Next up, we have Jonathan Mannheim.

Jonathan Manheim, Can you hear me okay?

Yes.

Good morning, council members.

Thank you for the opportunity to provide comment today about Council Bill 121055. My name is Jonathan Manheim, and I'm the president of Howell Real Estate, where we've built 1,646 apartments in the city of Seattle over the last 10 years, including 260 MFT units and 84 on-property MHA units.

My comments today are in support of Amendment 4. Which would remove an aspect of the MFTE program that has precluded thousands of new units from entering the MFTE program.

Anytime new housing is built in Seattle that removes an existing apartment building, the housing provider must go through the City's Tenant Relocation Assistance Program.

This program appropriately provides financial relocation assistance to displaced renters earning up to 50% AMI.

However, The current MFT legislation also includes language that says if a housing provider participates in the MFT program and therefore sets aside 20% of units at below market rents, it must, in addition, provide a one-to-one permanent replacement unit in the new building based on the number of apartment renters in the removed building that earn up to 50% AMI.

While the effort to have new development help pay for the creation of affordable housing is sound, The one-to-one replacement provision is misplaced as an MFT requirement.

New development justifiably already helps pay for the creation of affordable housing through MHA fees or MHA on-site performance.

The one-to-one replacement requirement for MFT adds an unreasonable burden to a program that already frequently does not make economic sense.

This additional requirement has and will continue to cause many housing providers not to participate at all.

Here's a real example.

We're working on a new 175-unit project that's owned for 75 feet in height, and the property has an existing low-rise apartment building.

All right, we're running out of time.

But essentially, I guess the bottom line of my comment is MFTE works without this additional...

Jonathan, thank you so much.

Next up, we have Ben Moritz.

Ben Maritz here.

Nice to see you all, hear you all.

I'm an affordable housing developer and also a property manager.

I think we're one of the biggest, if not the biggest, operator of MST housing in the city, and we see firsthand every day what a great program it can be.

It is an interesting thing.

It is both an economic development incentive and a program for moderate income renters.

It's the only program we have in Seattle to target that moderate income renter group, those people that are earning between 50 and 80% AMI.

We have many other programs for lower income folks which are great.

MFT is not one of them.

It doesn't cost the city any money.

In fact, it adds to the tax base in a massive way when it's used.

TNO taxes, sales taxes, And also, due to a quirk of how our state does things, it actually adds to the property tax revenue in Seattle, even though we're giving an abatement to the specific building that's being built.

It draws in capital for housing into Seattle, and such it has to compete with other programs in places like Bellevue and Redmond that have really attractive MST programs that many people like to use.

In older programs like P4, we were doing this.

We produced a huge amount of housing when the program was reasonable and able to be used.

We operate many of that housing today and we have many tenants who are very much appreciative of it.

As the city tightened things in P5 and P6, the program's use became much less.

It became more difficult to do it.

In part because the AMI limits went down and no longer became feasible as an optional program.

Many people didn't use it, and many people indeed didn't build the buildings in Seattle.

So I encourage you to keep this program a vibrant part of what we need here in Seattle.

Thank you very much.

Next up, we have Norris Cooper.

Norris, please press star six.

Hello, can you guys hear me okay?

Yes.

Great.

Norris Cooper.

I work for Holland Partner Group and I am on the development team.

I am commenting in support of Council Bill 121055. You know, we've, you know, at Holland, we've built over probably 2,500 units in the last couple of years in Seattle and have built over 400 MFTE units.

We've additionally paid $21 million in MHAPs.

And so, you know, I urge, you know, the council to approve Program 7 because it Does help bridge the gap to help housing be built.

And I think right now we're working on a pipeline of roughly 500 new apartments between several different assets in the Seattle market.

And this program, you know, is going to help get those projects built.

And when you look at it from the perspective of the projects are under construction, all of the taxes that those generate, the jobs that are created, The amount of housing supply that's ultimately built and, in addition, these new projects, some of them will be paying MHA fees or performing, which will then help affordability across the board.

I think one important component that we have to remember is MFTE is a voluntary program.

And, you know, at Holland, we have direct insight and communicate with equity that invests in these projects.

And some of the feedback that we get is that the paperwork and the documentation is onerous.

And from the equity perspective, optional, they might not want to participate in the program, which hurts the production of housing.

So I think that it's critical for us to remember that this is an optional program.

Thank you.

Thank you, Norris.

Next up, we have Scott Lean.

Good morning.

Can everybody hear me?

Yes.

All right, thanks.

Hi, my name's Scott Lean.

I'm the founder of Kamiak Real Estate.

We're Seattle-based housing developers, and I'm here in support of Council Bill 121055. We strongly support the overall legislation and most of the amendments, and I want to thank the council for the thoughtful approach.

In short, the program has become far less feasible over time in Program 6, Is just not feasible anymore as it currently stands.

Program six is not inducing projects to help start construction.

But when structured well, MFTE helps spur development activity and these amendments proposed are critical to that.

We don't believe this is about dedicated workforce housing as much as it's a tool to boost housing supply.

We are Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Amendment 4 fixes an MFTE problem that we've encountered.

This removes a current requirement that effectively precludes MFTE participation when a project is proposed on a site with existing housing.

In short, if existing tenants are deemed eligible for tenant relocation assistance and if the new project elects to participate in MFTE, then the project is required to include a replacement unit for every tenant relocation eligible tenant.

This does not count towards MFTE and is capped at 50% AMI.

And this simply just doesn't make sense from a policy perspective.

In short, we're thankful that...

Thank you so much, Scott.

Next up, we have Irene Wall.

Irene Wall.

Good morning, council members.

This is Irene Wall.

I'm in District 6. I ask you to pause any approval of the MFTU program for a year.

The amendments offered today will largely make the program less fair for both renters and the taxpayers who unwittingly fund it.

What answer have you given the renters commission to their letter asking for meaningful engagement in this program, which is purportedly supposed to benefit renters?

That advisory committee is supposed to have a real purpose in shaping the council's thinking.

But they've been systematically ignored over the last year, while the Mayor's Office worked with developers and building investors to craft this legislation so it benefits them.

Ask the Office of Housing to show you an objective assessment of who actually benefits from this generous exemption.

To borrow a phrase, it's the math, stupid, and it shows that the private advantage goes to the investors and the ultimate building owners.

Not the few renters who get a discount on their rent.

MFTE has the perverse effect of encouraging the rise in market rate rents by appearing to produce a small percentage of semi-affordable units.

As proposed, MFTE is another one of those tax deals that makes the rich richer and doesn't really produce workforce housing needed on a permanent basis.

If developers really need this tax, let them show you the pro formas they offer their private investors.

If you want taxpayers to finance new market rate multifamily housing, then put this excess property tax on the ballot in November.

Thank you.

Next up, we have Kate Rubin.

My name is Kate Rubin.

I'm a renter in District 2, the Co-Executive Director of V-Seattle and the Interim Co-Chair of the Seattle Renters Commission.

Last week, the Commission issued a letter urging you to reject the P-7 update and extend P-6 for another year.

This program allegedly benefits renters, but once again, renters were left out of the conversation.

We must be included as stakeholders in the update.

In the letter, we emphasized how important it is that future updates have a sunset date And detailed our concerns about the MFTE program and how P7, as proposed, would make these issues worse.

85% of MFTE renters are cost-burdened.

One in four is severely cost-burdened.

Instead of addressing this, P7 allows for even higher rent increases.

The MFTE program encourages development of very small units rather than housing that adequately meets the needs of the majority of the people in the workforce.

Seattle's new apartments are now the smallest in the nation.

Under P7, developers will be able to charge up to $1,416 per month for studios smaller than 320 square feet.

That's just $41 a month less than market rate.

They'll be able to reap the same benefit of up to 24 years of property tax exemption as those who build the two-bedroom and three-bedroom apartments that our city needs.

Income limits for renter programs should be decided based on the actual income of the renter population.

The MFTE program fails to account for the fact that HUD's AMI calculations include both homeowners and renters.

Homeowner AMI is approximately $181,000 per year, whereas renter AMI is only about $79,000.

T7 increases the maximum AMI for one-bedroom units up to 75% AMI, which is 112% renter AMI.

And for two-bedroom units, it's up to 90% or 161% renter AMI.

I'd like to thank council members Baca and Rink for their amendments to address.

Thank you, Kate.

Next up, we have David Haynes.

Have you noticed that the greed within the affordable housing nonprofits Keep conspiring to raise the AMI percentages so that then they can gouge those workers at 30% of all their salary, just so that the nonprofit can get even more money.

Remember when the Democrats of Seattle were offering legitimate incentives to real developers to build nine to 12 stories with three full stories given exclusively to affordable housing.

And then the Democrats who defunded police and created this racist government decided to pull a fast one and create an MHA fee fund and then took away the incentives to encourage the developers to create a billion dollar fund that then could be allocated to nonprofits that are politically connected to the re-election apparatus of the Democrat Party.

And a lot of those people are not qualified.

And the ones who are qualified, they're conspiring to like Shortchange the tax base and then make themselves richer by demanding that there should be a higher level of AMI.

But yet they're not building robust, livable amenities.

You all are creating these minimalized, weaponized property values that you all interpret as suitable enough for renters.

It's like you can tell that we have too many landlords on the city council who have permeated and tainted the integrity of the 21st century housing build outs that keep lining the pockets of racist, associated and affiliated and greedy nonprofits that need to be called out for their conspiring to get as rich as possible while shortchanging the qualities.

Virtue signaling Jimmy Carter's nonprofit that always wants to let you know how much they like black people, but they build like one house a year.

You got to have real developers

Thanks, David.

Next up, we have Alan Francis.

Good morning, council members.

My name is Alan Francis, and I'm here today to urge you to vote no on the multifamily tax exemption P7 proposal.

Seattle is in a housing crisis.

Our community needs real, tangible affordability.

But this flawed and rushed program provides very little public benefit in exchange for huge costs to our city.

P7 does not justify this expense.

P7 is a bad deal for renters.

It would remove 4.5% annual rent cap and significantly raise maximum rent.

A one-bedroom would go to over $2,200, which is nearly market rate.

This makes housing even worse for residents who are already cost burdens.

As the University of Washington study showed.

P7 is also a bad deal for taxpayers.

It provides developers up to 24 years of tax exemptions with no analysis of whether these units are truly affordable and continues to favor small units, many of which are sitting vacant.

Perhaps most confusing, or perhaps most concerning, this legislation was developed with minimal engagement from the people it affects most.

Renters and MFTE residents, and unlike previous versions, P7 has no sunset date.

We cannot afford to implement a permanent costly program that fails our community.

Therefore, I ask you to reject P7 and instead please renew the current P6 program for one year to allow for comprehensive inclusive review.

Let's create a program that truly delivers housing affordability.

Thank you very much.

Councilmember, that concludes our public speakers.

Great.

I do thank everyone for their public comment.

As there are no more registered speakers, we will now proceed to our items of business.

So first item of business, clerk will you please read item one into the record.

Regent item one, council call 121039, an ordinance relating to residential property transactions requiring certain disclosure to owners before presenting an offer to purchase a residential property, establishing consider protections for owners of solicited residential property and adding a new chapter 6.610 to the Seattle Municipal Code.

Okay, great.

So this item is for a briefing discussion and vote.

I see a presenter has joined us at the table.

So please introduce yourself for the record and begin when you're ready.

Thank you very much, Councilmembers.

Tracy Ratcliffe, Council Central Staff.

Today we are talking about Council Bill 121039, the Homebuyer Protection Ordinance.

This ordinance was discussed at the August 13th and July 23rd committee meetings, so I'm going to make my review of this legislation very brief, reminding you that this legislation does impose new requirements on individuals or entities making unsolicited offers to purchase homes from homebuyers.

These requirements include specific written notices and timelines for provision of written notices that are to be provided to a home buyer prior to signing a purchase and sale agreement and after a purchase and sale agreement is signed.

These written notices are to include such information as the right to request an appraisal, Which is to be supported or funded by the actual proposed buyer.

The right to hire a real estate agent or to seek legal counsel.

To seek information on fair market value of the home that's available from the King County Assessor.

And other information that FAS feels would be appropriate for the home buyer to secure.

The legislation also allows the homeowner to cancel a purchase contract within 10 days after contract execution.

Violations of this act may result in penalties of $7,500 for the first offense and $10,000 for the second and subsequent violations within 12 months.

In addition, it does provide the homeowner with a private right of action if the buyer fails to comply with the city ordinance.

If there are no questions about the ordinance itself, there is one proposed amendment from Council Member Sokka.

So with that, any questions or comments before we proceed?

Okay.

I move that the committee recommends passage of Council Bill 121039. Is there a second?

Second.

Okay.

All right.

It's been moved and seconded to recommend passage of the bill.

Council Member Sacco.

Thank you.

Thank you, Chair.

I move to amend Council Bill 121039 as presented on my proposed Amendment 1.

Okay.

It has been moved.

Is there a second for that?

Second.

Okay.

Motion has been seconded.

Council Member Saka, please speak to your amendment.

Thank you, Chair.

Colleagues, I ask for your support on this amendment.

Recall during our last committee meeting on this subject matter when we were deliberating and discussing various scenarios and possibilities, one thing that came up was how to strengthen this bill, how to make it even better, how to better ensure that it lives up to its intended goal of You know, going after those most egregious violators of this new ordinance and those sort of unscrupulous actors, if you will.

And I started to spitball a little bit about, well, what if we published a shame list of some sort for those kind of repeat violators that everyone would know Would our, again, repeat violators.

So that's exactly what this amendment accomplishes.

It would require an amendment, or excuse me, a published list updated annually for repeat violators, at least two, for at least two violations.

I ask for your support.

Thank you.

Thank you very much.

Any comments or questions regarding Amendment 1?

Council President Nelson.

I want to thank you very much for bringing this forward because last time we were talking about how do prospective home sellers know that the terms that they're being offered aren't very, aren't favorable, you know, and so this is simply putting in a place that is accessible, although it is, we're going to have to educate people to go to the site, This helps get us one step further in making sure that home buyers or homeowners are aware of sometimes predatory practices in general and also who is committing them.

Thank you very much.

Council Member Rankin.

Thank you, and thank you for bringing this amendment forward.

It's certainly a really interesting idea, and just as a point of curiosity, I'm curious, did you come up with this from yourself, or is there a peer institution that has done something like this before?

I'd love to know a little bit of background on how this came to be.

Yeah, no, thank you, Councilmember Rankin.

It came to be, I mean, there's no magic to it.

It came to be exactly how I described during that conversation that we all had.

Offhand proposed two concepts.

One, a shameless of some sort, ergo this amendment.

And then also potentially stiffening the penalties a bit.

And just as an aside, I explored Liza Rankin.

Tanya Woo.

Liza Rankin.

But because this is a net new sort of proposal and kind of cutting edge, I think it's more prudent at this point to just, you know, have the original penalties.

But, yeah, just the concept of a shame list has been applied in other...

It's really a disclosure.

At its core, it's a disclosure.

To provide enhanced disclosures to would-be residents who might be subject to these predatory home buyer practices and also other market participants.

It's a disclosure and I think more transparency and disclosure is a good thing.

Certainly agree with that and appreciate it and hopeful that, you know, I understand this will be a part of our city website, hopeful that perhaps we can provide direction or discuss with FIS about how we also link this to some of our county programs.

I'm thinking about the county's property tax exemption program, thinking about other program areas, just so we can find ways to create more visibility on this kind of list.

And so linking to and talking to other government agencies about how folks who may be accessing a program up there is also Know of this list.

So just putting that idea out there, but certainly a very interesting amendment, and I appreciate the thoughtfulness for creating some, shedding light on exactly who are the actors that we're talking about.

Thank you for bringing it forward, Council Member Saka.

Chair Orr, is there any comments from you on the amendment?

Actually, there are.

Thank you for calling on, Madam Strina.

Two things.

In regards to the 14 amendments that were just dropped on us, those are to item two.

I understand that.

But item number one, I'm looking at all my notes.

I don't have anything from central staff regarding publishing a list after a second violation except for the actual amendment.

So I'm wondering if I'm missing something.

I know that we had, which I can't divulge, the attorney-client privilege information that came out of our August 13th meeting.

And was responded to us.

Thank you, Tracy.

But I don't see any analysis from central staff about publishing a list after a second violation.

While I agree with the intent with what Councilmember Saka is doing, I would feel more comfortable if I heard something from central staff.

I trust your word, Councilmember.

It isn't that I don't believe that you know what you're saying.

I'm trying to get a better sense of, because I know in the past, When we have tried to publish, you use the term shameless.

There were some issues there because then there's an argument about what happens if you have one violation and the second one gets dismissed and it doesn't get pulled down from the online notice.

And we were subject to litigation.

It just opened up a whole Pandora's box of notice, whose responsibility it is, whether or not they remedied it.

So that's always my concern about publishing or having a quote unquote shame list.

So is there any is there any information from central staff on this?

Council member, we ran this proposed amendment bylaw and took their input on that, and they seemed not to fully reveal anything here, but they did not raise concerns about this proposed amendment.

We have talked to the mayor's office and the executive staff, and they believe it's workable.

But obviously your caution about the issue of not posting names that perhaps have people who have not actually been through their full appeal process of any kind of proposed violation would be prudent for them to do, and we will certainly talk with the FAS staff about that.

And if I may, Chair, yeah, I did read what you said, and thank you.

I appreciate that we posed questions on the August 13th committee.

And you responded, which I always appreciate, in a different color ink, right to the questions that were posed.

So, okay.

Thank you.

And thank you, Council Member Sokka.

All right.

Any other discussion?

Comment?

All right.

Council Member Sokka.

Thank you, Chair, and appreciate all the comments from you all, colleagues, and Council Member Juarez as well for your thoughtfulness and diligence about in the manner in which you approach these excellent questions.

Shameless is a shorthand.

The words on the paper say what they do, and it doesn't say shame anywhere.

Maybe shame isn't the best word.

It's a disclosure list.

It's a transparency list.

That's the underlying goal and intent.

And any color commentary that flows from what happens there, the text of the amendment speaks to repeat violators.

And any commentary which flows from there is really in the eyes of the beholder.

But great, great questions and feedback, so thank you.

All right.

Will Clark please call a roll on Amendment 1 to Council Bill 121039. Chair Bares?

Aye.

Council President Nelson?

Aye.

Council Member Rink?

Yes.

Council Member Saka.

Aye.

Vice Chair Salmon.

Aye.

Vice Chair, there are five votes in favor and zero opposed.

Okay.

Great.

Okay.

Do any members of the committee have any comments before we vote on the bill overall?

Okay.

Hearing none, will the clerk please call the roll on the passage of Council Bill 121039 as amended.

Chair Barras.

Aye.

Council President Nelson.

Aye.

Council Member Rink.

Yes.

Council Member Sokka.

Aye.

Vice Chair Salmon.

Aye.

Vice Chair, there are five votes in favor and zero opposed.

Okay, great.

The motion carries.

And the committee recommendation to pass Council Bill 121039 as amended will be sent to the September 16th, 2025 City Council meeting.

Before I move on, I do have to acknowledge Council Member Hollingsworth as a co-sponsor of this legislation.

Thank you very much, Council Member Hollingsworth.

Council President Nelson, did you have a comment?

Yes, we had so much discussion last time that we just went straight to the point and straight to the vote, but I did want to I express my thanks to Chikundi Salisbury and the Black Legacy homeowners for advancing this effort and for being strongly behind this effort and other key anti-displacement policies and strategies that have already been implemented in the city because we really do have to be mindful of the fact that we have to protect our Of course, most vulnerable residents, and that often means the homeowners who are being preyed upon, but also our elderly and lower-income people that are on fixed incomes and have a home, and they're constantly experiencing the vultures circling.

So thank you very much.

Just wanted to mention that.

Thank you very much.

All right.

We'll now move on to our second item of business.

Will the clerk please read item two into the agenda?

Agenda item two, Council Bowl 121055. In ordinance relating to the multifamily housing property tax exemption program, renewing and modifying the program, including to make changes in conformity with state law, repealing chapter 5.72 of the Seattle Municipal Code and amending chapter 5.73 in sections 5.75 and 090 and 2350A 062 to the Seattle Municipal Code.

All right.

I see our presenters have joined us at the table.

We've got a lot of amendments, you know, regarding this legislation.

So, you know, basically we're looking at briefing and discussion of these amendments.

No action on votes today because we need to digest, you know, what we are receiving.

So with that, please introduce yourselves for the record and begin when you're ready.

Tracy Ratcliffe, Council Central Staff.

Hello, Jennifer LeBrec, City Council Central Staff.

So we'll be doing two things today.

First, we have a brief presentation just with a reminder about the proposed Program 7, Council Bill 121055. And then we will be walking through 13 amendments, actually 14, with one from Council Member Saka added yesterday.

All right.

So let me say, this will be just a quick review of the proposed changes.

We'll be talking about the timeline and then, as I said, the discussion of proposed amendments.

Next slide.

The review today is not a comprehensive review of all the proposed changes.

We did that at the August Housing and Human Services Committee.

We're really just trying to highlight ones that are most relevant to the amendments that are on the table for discussion today.

A quick review of the MFTE program.

I'm sure everyone is familiar with this.

It's a 12-year tax exemption program.

It's a voluntary program, and property owners since 2021 now have the option to extend for another 12 years at reduced income and rent levels.

25% of the units must be affordable.

I would say income and rent restricted or 20% if at least 8% of the units are two bedrooms or more.

And it does include a home ownership program.

And as I'm sure you're aware, the current program sunsets on September 10th if council does not take any action.

So now we'll walk through some of the key policy changes that were included in the legislation transmitted by the mayor this summer.

Next slide, please.

Okay.

The first major policy change has to do with income and rent limits for new projects.

Under the proposed legislation, income limits remain the same for congregants, studios, and three bedrooms, but they do increase by five percentage points for one and two bedrooms.

And even for units where income limits stayed the same, rent increased because P7, this proposed Program 7, uses a rent chart that is tied directly to HUD-published median income and not the modified rent chart, which we talked about quite a bit in the August meeting.

Next slide.

Another major change in the proposed legislation is income and rent limits for MFTE properties that choose to extend their tax exemption for another 12 years.

Oh, no, that's fine.

I'm gonna stop for a moment.

You're doing okay?

I am.

I just don't know why it's not moving.

All right.

Under the proposal from the executive, rent limits and extending properties would be five percentage points below what would be required for newly constructed projects, except for two and three bedroom, which in order to be compliant with state law, Would be 10 percentage points below.

And we will come back to this slide probably several times throughout our discussion of amendments as there are a couple proposed changes to this chart in particular.

All right, another part or another change in the proposed Program 7 would be that it would allow projects that have applied to Program 6 but have not yet completed to elect to convert to Program 7. I think the key thing here is that, as currently written, the proposed legislation would only allow projects to convert if they have not yet completed and received what we call their final certificate.

And there will be an amendment proposing some changes to this as well.

Next one.

For the first time, Program 7 creates a definition for a standard bedroom as compared to an alternative bedroom.

I think the easiest way to think of this is that a standard bedroom has a window to the outside, and an alternative bedroom is mostly fully enclosed but does not have a window to the outside.

So we are going to get lighting or ventilation, mostly through artificial means.

And not only does the proposed legislation define these two types of bedrooms, but it regulates the units differently.

Alternative bedrooms are regulated at a lower level than units that have a standard one bedroom.

Next one.

And then finally, one of the other major changes in the proposed legislation is that it eliminates a sunset date.

So historically, MFTE has had a sunset date of every four to five years, and council has needed to take action to reauthorize and continue the program.

That's the situation we're in right now.

This legislation would eliminate the sunset date but provide direction for program evaluation on a regular basis and provide some particular issues to consider if changes are needed after four years.

So that's a quick overview and then we'll talk about next steps.

So just as Vice Chair Solomon said, today we're here only to discuss amendments, no votes.

There will be a special Housing and Human Services Committee on the morning of September 22nd, where it is anticipated that the committee will vote on both amendments and the legislation itself.

And then the full council vote is planned for September 7th, and that's a little bit of a ways out just because of schedule during budget.

October 7th.

Thank you.

Sorry about the confusion on the slide.

I didn't notice that the slide was different.

All right.

So now we're going to start walking through the amendments unless there are any questions on that presentation.

All right.

So we have 14 amendments to cover today, and they're broken down into categories.

Amendments one through seven are going to be related to newly constructed projects applying to MFTE for the first time.

Amendments 8 through 11 are related to MFTE properties that are expiring and might want to apply for an extension.

And then amendments 12 through 14 are related to the MFTE program as a whole.

So let's start with Amendment 1.

Mr. Chair, can I ask a quick question again?

Yes, please.

So amendments one to seven are again, what?

Okay.

Thank you.

And I'm actually realizing, I think I said that wrong.

So amendments one through seven will be related to new projects that are applying to MFTE for the first time.

Then eight through...

I guess this got a little messed up because there's an extra one.

Let's say eight through 12 will be about projects that want to extend.

Eight through, I'm sorry, eight through 11 will be related to projects that want to extend for another 12 years, as will amendment 14 is also related to that.

And then amendments 12 and 13 are just related to the MFTE program as a whole.

Thank you.

You're welcome.

All right, so let's start with Amendment 1. And Vice Chair Solomon, would you like me to just go in or do you want to give...

Okay.

Go for it.

Just plow through?

All right.

Plow through.

I will go through each one and then pause for questions.

Amendment 1 would increase income and rent limits for alternative one-bedroom units and new projects.

As you'll recall, we just talked about this, Program 7, the proposed Program 7 has created...

For the first time, a definition for an alternative in standard one-bedroom units or units with alternative or standard one bedrooms, and it's key to know that units with alternative bedrooms are regulated at a lower level.

Currently, in Program 7, alternative one-bedroom units would be regulated at 65% AMI, and this amendment would change that to 70% AMI.

For context, the maximum rent for an alternative one-bedroom regulated at 65% AMI is $1,915 and at 70% AMI is $2,062.

There is unfortunately not a good source of data for market rate rents for units that have these alternative one bedrooms.

So it is not possible to compare MFTE rents against market rate rents for this type of unit.

And I will pause there for questions.

Any questions?

Okay.

Hearing none, proceed.

All right.

Amendment 2. This amendment would establish a separate designation and income limit for units that are at or below 400 square feet and have at least one standard or alternative bedroom.

For example, a one bedroom under 400 square feet would be regulated at 60% AMI under this amendment, but a standard one bedroom over 400 square feet would be regulated at 75% AMI, according to this amendment.

I think the premise here is that market rate rents are lower for smaller units, which makes sense since units are usually priced at a price per square foot.

And we do have some data from CoStar that supports this.

The average rent for a one bedroom between 200 and 400 square feet is $1,600.

Versus $2,000, $2,044 for a bigger two bedroom, I'm sorry, for a bigger one bedroom that is between 400 and 550 square feet.

I will stop here for questions.

Yes, Council Member Sokka.

Thank you, Chair, and I just want to thank central staff for your expert analysis and kind of walking us through this very highly complex, very technical and nuanced, but important subject matter, and then also working so closely with my office to put together my own amendments, and then I saw, then I learned we have 14. But I think what would be helpful, so some of these amendments, well, In my case, I have two amendments, but they are clearly inconsistent and incompatible.

One must pass.

That sets the cap at 10% in the case of Amendment 8, and then—and we'll get to this later—or Seven and a half percent in the case of Amendment 14. They're clearly competing, clearly inconsistent.

One or none would end up prevailing.

So there might not be as stark Examples of the package of 14 amendments as that, but just to the extent there are some potential inconsistencies, and I appreciate how you described and gave a description of the various buckets or tranches of these, but to the extent there are potentially competing or somewhat inconsistent amendments, it would be helpful if you continue to call that out.

Thank you.

Thank you very much.

Something that just occurs to me and maybe my friends from Nitsa State can answer.

When I was looking at the 4100 project, Willow, the average bedroom size is 382 square feet.

Yeah, just under 400. I don't know if this is protocol to ask questions from the dais.

What's your average unit rent there?

Ah, OK.

Oh, it's not a lot.

I'm sorry.

OK.

I'm being reminded about protocol.

But anyway, we'll have that discussion offline.

So basically what I'm getting at or trying to get at is Do these, you know, is what's proposed in this amendment, I guess I'm trying to think, does a pencil for the renter, does a pencil for the provider.

So anyway, that's me just thinking out loud, so never mind.

Okay, good to you.

Any other comments or questions for The committee.

From the committee.

On the amendments.

Okay.

Cool.

Thank you.

Please proceed.

And Councilmember Saka, I appreciate your flag because there are a couple of amendments that sort of work with each other in interesting ways that may be true for one and two.

I have to go back and think about that as you said that now.

So thank you for the flag.

I am going to move on to amendment three.

Bear with me.

I'm getting myself organized here.

Okay.

Amendment 3 would add or amend administrative rules by the Office of Housing regarding two different subjects.

One subject is income verification for MFTE tenants, and the second subject is the selection of MFTE units to meet comparability and distribution requirements.

The amendment would require the Office of Housing to publish a director's rule regarding the process for selecting MFTE units that meets the comparability and distribution requirements under the proposed legislation.

The goal of the director's rule would be to provide predictability and certainty regarding selection of MFTE units as early in the application process as possible.

However, the reality is that there are some factors that impact MFTE unit selection that really are, you can't see, for example, in the initial plan set.

For example, we talked about how alternative bedrooms need, you know, to have walls that are at least seven feet high.

That might not be a level of detail that shows up on the plan set or under the proposed program seven, it only requires that units be comparable To sort of non-premium units, but that might be a matter not just of like the design of the unit, but features or fixtures of the unit.

So the director's rule would kind of need to balance those two considerations.

OH would be required to publish the Director's Rule by March 31st of 2026. The amendment would also require OH to amend its compliance manual for MFTE property owners In order to allow for a streamlined income verification process that includes a process for tenant self-certification, this would need to be completed by December 31st, 2025. And we've spoken with OH about both of these amendments, and they do feel like they are both doable by these timeframes.

Council President Nelson.

I just wanted to speak on behalf of my amendment.

It has two parts, so I'll take the first one first, of course.

Basically, this amendment has two requirements.

The first one is that OH must clarify and simplify the process by which developers prove that an MFTE Units are comparable to the market rate in units in the same building.

And I'll say that this requirement of developers is important because the MFTE unit shouldn't be all squished together at the bottom of the floor and otherwise, you know, of substandard quality.

But the current process for proving the comparability of these units is extremely onerous and was highlighted in the UW report on MFTE as a major hurdle To ensuring that level of equity that this program is supposed to provide.

OH requires copious amounts of paperwork and planning documents in advance of construction, but then will often require extremely detailed inspections of nearly finished units to prove that they are comparable, and it doesn't need to be this complicated.

I'm told that the compliance manual is 65 pages long and extremely difficult to get through.

And so what we're trying to do is just to make it easier for this program to be functional.

And so that is the, that's the gist of the first requirement.

The second one I think is even more important because this is, this is, it's, My goal here is to make it easier for renters to show that they are eligible for these affordable units.

I think these are 17 forms that a renter has to fill out to show To prove their income, that they are eligible for these units.

And this is way too much.

We need to make it a lot easier for renters and for the builders, but particularly for the renters to show that they are eligible for a spot in these buildings.

It seems like, and I'm the reason for this, and I understand that the Office of Housing was going to do that and streamline the process, but this provides a date by which they have to do that, and it's just, you know, getting something on paper ensures that it'll happen before this program is rolled out in advance time.

So that's all I wanted to say.

Thanks.

All right.

Thank you, Council President Nelson.

I am actually going to go back.

Council Member Rankin, I never gave you an opportunity to speak to your amendment.

Would you like to take the time to do that now?

No, I will keep my remarks for our next committee meeting when we're taking these up, just so we can get through all of our 13 amendments for today.

Thank you for the opportunity, though.

Okay.

Thank you very much.

All right.

Please proceed.

All right.

Amendment 4 has to do with the requirement to replace units serving low-income households.

This is actually, you heard a couple public commenters about this today.

This is in relation, sometimes it's called the TREO.

A replacement unit requirement.

This amendment would eliminate the requirement that projects seeking to use the MFTE program for redevelopment replace units that serve low-income households in an existing building that would be demolished and on which a new building Utilizing the MFTE program would be built.

I think the easiest way to explain this requirement is through an example.

So let's say there is currently a 50-unit occupied building, and SDCI determines through its Tenant Relocation Assistance Program that five out of those 50 units are occupied By Treo eligible households, meaning that those households are at or below 50% AMI.

Under the current MFTE code, developers would need to provide five replacement units at 50% AMI plus their MFTE units if they wanted to be able to demolish this building and build a new unit and build a new property and use MFTE.

This amendment eliminates the requirement for replacement units.

The only thing I want to add is that this requirement basically exists.

There's an 18 month clock.

So if the developer submits a permit application within 18 months of SDCI determining that there's an income-eligible household in the property, then this requirement applies.

If they submit a permit application in month 19 or 20, then the requirement no longer applies.

I'll stop there.

I imagine there may be questions.

All right.

Hearing none, please proceed.

Okay, Amendment 5. This amendment would allow projects that had submitted an application under Program 6 and received a final certificate in 2025 to convert to Program 7. And a final certificate is essentially the final piece of paperwork that a completed project gets that says that they've met all the requirements and they are now officially part of the MFTE program and all of their obligations under the MFTE program are in effect.

The legislation as transmitted already allows projects that have submitted applications but have not yet completed or received their final cert to convert their application from Program 6 to Program 7. It's assumed that most developers will want to do that because the terms of Program 7 are more favorable to them.

However, what's key is that as currently written, this conversion is only allowed for projects that have not yet completed.

So this amendment expands that slightly.

It allows projects that applied under Program 6 and have completed To convert to program seven.

I'm sorry, that completed in 2025 to convert to program seven.

And based on information available to us, there are seven projects currently that meet this criteria.

So they applied under program six and they received their final certificate in 2025. And those seven projects would be allowed essentially to convert from program six to program seven terms.

Any questions on Amendment 5?

All right.

Hearing none, proceed.

All right.

Amendment 6 is very much just a technical amendment.

It would make corrections to numbering for a section dealing with comparability and distribution, and then it would just change the term market rate units to unrestricted units, thereby making terminology consistent throughout the legislation for what we're calling the non-MFTE units.

Questions, comments?

Great.

Okay.

Amendment 7. Amendment 7 is also technical.

I know there's like a lot of red ink, but it's really just a technical amendment.

It would make edits for the purposes of clarity to language around the rent cap or rent moderator.

One of the Things that it's clarifying is that rents published by the Office of Housing, MFTE rents published by the Office of Housing, must be tied to median income as published by the Department of Housing and Urban Development.

That has always been the case, both in old and this proposed code, but it just makes it super explicit.

Okay, good.

Council President Nelson.

Yeah, this is really about conforming to law and making sure that it's clear so that everybody who is participating or seeks to participate or who is living in an MFTE building understand what the requirements are.

So we have to remember that at the end of their 12-year contract, the voluntary option to extend another 12 years and continue to provide these below-market units is not an incentive.

It will not be used.

So basically, what we're trying to do is ensure that this doesn't happen, that renters will lose their affordable unit, and this, in fact, does directly impact the cost burden that they are The people that are cost burdened and struggling to stay in their units.

So it also means that for the city, every time we lower AMI, we're making the pool of renters who have access to this unit smaller and less inclusive.

Higher AMIs mean more access, not higher prices.

And then the direct feedback we've heard from people in our city who would be building housing is that 10% is Is fairly low.

And so what we have to do is look at SDCI's housing dashboard, and this is available to anyone, to know we're heading for a really tight housing supply market and rents are going to go up.

And to me the most important thing we can do right now is make sure that every single tool is available to renters to help them remain stable so they can find housing.

That is the main point.

But we have often talked about what happens when we lower the AMI for existing units that are already rented out to someone.

Then that means that the existing renter can no longer live there.

And so we don't want to be displacing people.

And that's another thing that this amendment is really trying to get at.

So happy to answer any questions.

All right.

Any questions regarding this amendment?

All right.

Hearing none, please proceed.

And if I can, I'd love to just respond.

Council President Nelson, I appreciate your point about, and we're gonna actually, this is the perfect time to talk about this because we are now pivoting to talking about those amendments that are impacting projects that do want to extend for another 12 years.

And I know this question has come up, the extension income limits I'm not talking about a specific amendment right now.

I just want to provide some context.

The extension income limits are lower, right?

So if you're in a property and it chooses to extend and there's a tenant in that unit, an MFT unit, the income limits for that unit will go down.

So what happens to that tenant, right?

As currently written, the code does allow grace for a tenant who is over income to both remain in their unit and continue For that unit to be considered an MFTE unit.

The code says that the tenant can remain in the unit at an MFTE rent.

Until their income exceeds 1.5 times the income associated with that unit, up to 115% AMI.

Let me walk you through a couple examples.

Let's say you have a tenant and a studio that's regulated at 60% AMI.

When the tenant first moves in, their income has to be at or below 60% AMI.

Next year, they go to recertify because you have to do that annually.

Their incomes now, as long as their income is below 90% AMI, 60% times one and a half, they can still remain in that unit.

Let's imagine you had a tenant at, let's just say a two bedroom at 80% AMI.

That tenant can stay in it.

That 80 times 1.5 is 120% AMI, but in the code the cap is 115% AMI.

But there's still a big sort of grace in there, right?

The tenant can stay in that unit.

If their income is below 115% AMI.

So it is written so that there isn't a cliff where like the moment that a tenant's income goes a dollar over the income limit associated with that unit that they lose the MFTE protection.

Thank you for that.

Any other questions or comments regarding this amendment?

Sorry, that was a sort of overall context, so I will go to Amendment 8 now if that sounds good.

These are actually two amendments that are mutually exclusive, so let me walk through both of them and try to explain why that is.

Just as an overall description, Amendment 8 would lower The income and rent limits for smaller units and extending properties, while Amendment 9 would increase the income and rent limits for studios and extending properties.

So you can do one or the other, but not both.

We'll walk through Amendment 8 first.

Again, this amendment would decrease the income limits for smaller units, one bedrooms and smaller, for properties that want to extend their tax exemption for another 12 years.

Essentially, the amendment would lower income limits by five percentage points for congregates, studios, and one bedrooms.

Two and three bedrooms would remain the same.

The result would be that all units and extending properties would be regulated 10 percentage points below what would be required for a unit in a newly constructed project.

We do have the chart here that's part of the amendment, and I'm happy to walk through this if that would be helpful.

Okay.

All right.

Council President, you had a question, or is that a previous hand?

Well, I do...

I was going to wait.

Is the sponsor planning on speaking on behalf of it?

I was actually going to...

Okay, yeah.

I might have a question.

I might not.

Go ahead.

Okay.

Excuse me.

Thank you, Chair.

And thank you for walking through this with us, Tracy and Jen.

So this proposed amendment number eight, and I'm glad we're talking about amendment eight and amendment 14 in tandem.

So hopefully we'll save a little time after 13. But because they are mutually exclusive.

So as we know, P7 established rents for extending properties at 5% less than new constructed projects.

And so P6 under the immediately pass, immediate pass or now expiring P6 program, that sets the rents at 10% less than older buildings.

So my amendment basically, my two competing amendments restores Well, the first one will restore it back to 10% of the newly construction buildings for smaller units on one proposal, and then the other one would sort of split the difference, if you will, between the 5% and 10%, and that's 7.5%.

So very technical, specific amendment proposal, but at its core, at the highest level, it's specifically designed and intended to help address affordability.

That's what this is all about.

And, you know, colleagues, we heard some specific feedback from a number of stakeholders.

Within the developer community, we know that this is a voluntary, 100% voluntary, optional program, and it's intended to be an incentive.

And the developer community is mission critical in terms of this.

And table stakes, we need their input.

We also know that they're not the only stakeholder across the city that might have a point of view on this.

So just wanted to be mindful of some of the feedback that we're hearing from other stakeholders, including folks from the Renters Commission, advocates in the human services, that kind of space as well.

So again, this is ultimately designed to Improve affordability.

I don't have strong feelings today about which would be the preferred path in terms of 7.5% or the 10%, restoring it back to the P6, 10%.

But I do know that we need to do more as a city to help improve affordability for all.

The Render's Commission reminded us that 85% of renters living in MFTE units are cost burdened, paying more than 30% of their income each month on housing costs, and one in four are severely rent burdened, with housing costs accounting for more than half of their monthly income.

So mindful of some of these Important real-life, everyday issues impacting many people across our city.

Also mindful of, at the end of the day, because this is an incentive program, these projects need to pencil.

So I wanted to find a way to better harmonize those interests.

So that's the thinking that went behind there.

Again, today I don't have strong feelings on either because they are mutually exclusive.

The whole point of going through this amendment process is to have the dialogue, which leads me to my next point.

I want to thank the chairs or co-chairs, Chair Solomon, Chair Juarez, for graciously accommodating my request to delay a little bit the final voting on this.

We learned that Not everyone felt included in the process, which I understand.

In my view, I don't think we can delay indefinitely.

I think we need certainty for all.

But delaying the final vote by a few weeks, I think, would Make the process a little better and allow us to try our level best to incorporate as much of that feedback that we're hearing from other communities and other stakeholders.

And that's in part what this is Intended to do as well and designed to do.

Again, affordability is the name of the game.

Thank you, co-chairs Solomon and Juarez, I suspect, for accommodating my request to make sure we're not rushing through this and voting on all amendments in one committee meeting today.

But I do suspect, as a practical matter, your decision was made a little easier when you learned there was 14 amendments.

A little more time for community, I think, benefits everybody.

So, thank you.

All right.

Thank you very much, Council Member Saka.

Council President Nelson.

So, this whole program is designed to incentivize housing developers to build housing and then they get a tax break after the fact.

And then the program, and then people move in.

And then the program may change from the 11th year to the 12th year, whatever, but there are people already living in these units, and so what's going to happen to them?

If you lower the income limit, then they have to move out.

And so I'm not quite sure, and I can ask on my own offline, but it seems as though the This will end up definitely harming the renters because people move into these units and stay there.

It's difficult to be eligible for an affordable unit within a market-produced building, and so people are going to stay.

And then what happens when the limit is lowered and they might have gotten a raise recently, which is what we hope people do over the course of that amount of time.

And so I just feel like this is going to displace people, and in fact it did Happened to my friend.

She had to move out because the income limit was lowered and she was no longer eligible to stay.

So I do caution that this could have unintended negative consequences.

Okay.

Thank you.

All right.

Any other commentary from the members of the committee?

All right.

I do have some questions, but I'll hold them until the end.

So go ahead and tell us about number nine.

Well, let me do two things.

One, I just wanted to respond to Council President Nelson for one moment.

Certainly, I don't want to deny that for some folks when the income limit in an extending property is lowered, sometimes people are over income for the unit, and that can happen in some occasions.

I do want to be clear.

Somebody has their rent until their lease expires, and then what typically happens is that the tenant can stay, but the unit, Loses the MFTE designation and then the property owner has to, and then the rent can go to whatever market would support.

And then another unit in the building would be designated as MFTE.

So that is the process.

And just to reiterate again, there is that grace that is provided under the code so that someone's income can be one and a half times whatever the income limit is that's associated with that unit and still be able to stay.

And based on some data provided, From OH for past reauthorization, buildings that have, I'm sorry, for buildings that have extended, that is quite common for tenants to either be at or below the new income limit or be able to remain because of the grease, the sort of buffer that's provided.

Before we go to Amendment 9, I just wanna make sure that everyone knows that Amendment 14 is a competing amendment from Council Member Saka that has the 7.5% option.

So essentially, Amendment 8 Would lower income limits for extending properties to essentially 10 percentage points lower than whatever a new project has to do.

And Amendment 14 would do the same thing, except it would say that all the income limits have to be 7.5% lower than what a new project would get.

And so that's really the only difference between Amendment 8 and Amendment 14.

Mr. Chair, may I ask a clarifying question?

Thank you.

So I'm looking at Amendment 8 and Amendment 14 and the two different charts.

So what I've just noticed is that on Amendment 14, under proposed amend extension rents, there's just differences, as we said, in amendment...

I'm trying to keep all this paper straight.

In Amendment 14, the numbers are just higher than in Amendment 8. The first one, two, three, four boxes, four lines.

Yep.

Whereas the 80% stay the same.

Yes, and that's a good observation.

The two and three bedrooms stay the same because the state says that units and extending properties cannot exceed 80% AMI.

So that's the max for those.

Okay.

So, but that's the actual difference between the two.

It's really exactly.

It's the first four rows under the proposed amendment extension column.

I'm a visual learner.

I have to have colored pins in a box.

So thank you.

Thank you, Councilmember Saka, for the competing and all the lovely amendments.

All right.

Okay.

So walk through number nine.

So now we will talk through...

Before we do, Councilmember Saka.

Yeah, if I may just clarify, re-emphasize.

Thank you, Councilmember Juarez.

I, too, am a visual learner, and I use it with color-coded, extra color-coding for me to help me discern complex constructs such as this.

But so I think We beat the dead horse, so to speak, on amendments 14 and 8. And the difference is, at least for purposes of this discussion, I just want to note the admin housekeeping item, the reason why they appear differently.

I approved them both on Friday, I believe.

But it requires a lot of staff time still to kind of make those calculations in the table.

And it still had to clear, you know, another legal review, even though it was substantially so.

So the original slate of 13 was published.

Was it yesterday or whenever it was?

And then this one I circulated yesterday.

That's the only reason.

But in any event, and I will pull one by the time of our next committee meeting.

So thank you.

Thank you.

Any other commentary?

All right.

All right.

Proceed, please.

So Amendment 9, so 8 and 14 would lower the income limits for extending properties.

Amendment 9 would increase the income limits in extending properties for one type of unit, which is studios over 320 square feet.

And it would increase the income limits for these studios from 55% to 60% AMI.

That would mean that studios over 320 square feet in both new and extending properties would be regulated at the same level.

All other units in extending properties would be regulated at a lower AMI than the same unit in a new property.

I think I will stop there.

Questions?

All right.

No questions, please proceed.

All right.

Amendment 10 would allow owners of MFTE projects seeking a 12-year extension to elect to retain the existing MFTE designated units and unit classification.

And this is an amendment that is about as in the weeds as you can get, so bear with me for a moment.

Program 7 has created a new alternative one-bedroom definition.

We talked about that.

That's a new definition, right?

Projects that applied and were approved under previous versions of the program, there was no alternative one-bedroom.

You were either regulated as a studio or as a one-bedroom, and OH made that determination.

Additionally, in older projects, there wasn't as much emphasis placed on comparability and distribution.

So in older projects that are now expiring, MFTE units may, for example, be smaller or may be more disproportionately on the bottom floors.

Under this amendment, property owners would not be required, essentially, to re-designate, to change their designation of MFTE units in order to meet current standards.

So they wouldn't have to go back through and say, oh, this is an open one or this is a, I'm sorry, an alternative one or a standard one.

Or, you know, we have too many units on the bottom floor and we need to move some to the top floor.

They would be essentially grandfathered into what their existing unit designations were.

And that's it for that one.

Okay.

All right.

Any questions or commentary regarding Amendment 10?

Yeah, really in the weeds.

Okay.

Moving on to 11. All right.

This amendment would do a few things.

It would give projects that are expiring in 2025 additional time to decide if they wanted to apply for a 12-year extension.

So under the current code, there are, well, let me start by saying there are 18 properties that have an MFTE exemption that is expiring this year.

Under the current code, those properties had until May 1st of 2025 to decide whether or not they wanted to extend, and seven properties submitted an application to do so and 11 did not.

This would essentially give those 11 properties that didn't apply until November 1, 2025 to decide if they wanted to apply, with sort of the rationale that the terms of Program 7 are different than the terms of Program 6, and those properties might make a different decision about extending now that they know what the Program 7 terms are.

It would also allow properties that had submitted the application under Program 6 terms to convert that application to Program 7 instead.

One thing I do want to note here is that under both Program 6 and the proposed Program 7, all tenants and MFTE units must submit income certification documents annually.

However, properties expiring in 2025 are approved under older versions of the program in which income qualification happened only at the time of initial application.

As such, it is a time-intensive process for property owners to income-qualified tenants.

You know, you might be going back to a tenant who moved in two or three years ago and saying, new requirement, you have to income certify, right?

And that's time-intensive.

And OH, and it will also take time for OH to review the property owner's application to confirm compliance with the new requirements.

So it is for projects that submitted an extension application on November 1, it is unlikely that the income qualification and OH approval process would be complete by the end of this year, and that would mean OH would likely have to issue final certificates by December 31st so that tax exemption could continue into 2026 without interruption without being able to confirm that the property owner has achieved full compliance with Program 7 terms.

Under the proposed amendments, owners would have an additional six months to achieve compliance with Program 7 terms.

And there is a typo in this amendment.

This should say June 30, 2026, not June 30, 2027. So that will be fixed when we come back next on the 22nd.

So essentially, just to say that there is going to need to be sort of a grace period here for property owners to get into compliance with Program 7 terms.

Um, just given the late date, the late, um, sort of deadline for, uh, them to notify OH that this is what they want to do.

Okay, great.

Any questions from the committee regarding this amendment?

All right.

All right.

Hearing none, please proceed.

All right, Amendment 12. This amendment would add several pieces of information that would be included in the annual MFTE report that the Office of Housing submits to City Council.

So to clarify, under the proposed legislation, OH is required to submit a fairly extensive annual report to City Council With information on the MFTE program, this adds a couple of reporting requirements with the goal of enhancing Council's understanding of how tenants are served by the program and the public benefits associated with the MFTE program.

That's it.

All right.

Council Member Saka, do you want to speak to this amendment?

This is amendment, the reporting requirements amendment?

Yes.

12?

I think it's pretty straightforward.

Enhance reporting and disclosures to help us better understand efficacy and, you know, kind of better reveal what potential tweaks, however marginal, might need to be made on a going-forward basis.

So, you know, I'm a proponent.

An unapologetic champion of more information, and this is what this is designed to achieve.

So thank you.

All right.

Thank you.

Any other questions or comments from other members of the committee?

All right.

Hearing none, can we proceed to a member 13?

All right, last one.

This amendment would establish, or I would say reestablish, a sunset date in the MFTE code.

And the sunset date would be four years from now, September 1, 2029. And just as is currently the case, if the sunset date were added, City Council would be required to reauthorize the MFTE program.

On or before the sunset date in order for the program to continue, which would mean to continue to offer new applications.

It would not impact program or buildings that are already part of the property.

Sorry, already part of the program.

And currently the legislation does not have a sunset date.

Great.

Thank you.

I see that this is a co-sponsored by Council Member Sokka and Rankin.

Would either one of you like to speak to this amendment?

Happy to yield.

You haven't spoken much today, so I'll give you the right of first refusal and all.

Thank you, Councilmember Saka.

I'm glad that we can come together to co-sponsor this amendment.

This was something that we heard a little bit discussed in public comment.

This amendment would, of course, reinstate the sunset, this coming from direct feedback from the renter's commission.

Okay, cool.

All right, thank you.

Council Member Sockham.

Thank you, Chair, and I want to thank Council Member Rankin for co-sponsoring this amendment with me.

I also want to thank the Renters Commission for meeting with my office, and I look forward to meeting with them personally, I think next week.

I don't know.

This, at its core, I mean, to Councilmember Ring's point, is designed to address some specific feedback that we've been hearing from various communities.

We've heard strong concerns over the deletion of the sunset date from constituents.

Again, especially renters and affordable housing advocates.

So this amendment would simply restore the four-year sunset date.

There's obviously a ton of precedent for doing exactly this.

And so I think this is ultimately about two things.

Affordability.

Mentioned what that looks like.

But also, I think it's good governance as well.

Stakes are too high.

Their stakes are too high for our failure to make Seattle more affordable for all, and stakes are too high with a multi-million dollar MFTE program.

I think adding a sunset date of some sort, four years, five years, whatever it is, is prudent, wise, and responsible.

Because it serves as a forcing function to require us to come back periodically and make changes and tweaks to improve it, to address then current market conditions and make it even better and make these projects pencil even better.

So deleting a sunset date whatsoever in perpetuity for something of this Significance and grade of a scale and subject to fluctuating market conditions, I don't know if it's the best, most appropriate, prudent course of action for the reasons I mentioned.

So affordability and good governance.

Thank you very much.

So, and we've already discussed Oh, Council Member Warris, or Council Chair Warris.

Chair Warris.

Thank you, Co-Chair.

Before we, you know, I know you're talking about reinstating the sunset date and restoring the four-year.

Can I ask, why was it removed?

What was the reasoning behind that?

I don't understand.

It was removed in the version that was transmitted by the executive, and I think their thinking was that they wanted to take a different approach where essentially they provided some factors to consider at sort of a four-year point to determine whether or not tweaks needed to be made.

I would offer reauthorization is a pretty significant body of work for the department, and we can see that this year, so that may have been part of the consideration.

It also provides uncertainty because every four years, developers wonder, is this program going to be available?

Is it not going to be available?

What will the terms be?

So I think also a desire to just provide maybe a greater level of certainty.

But I think we'd have to Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

Liza Rankin.

As long as the as long as I've been around.

So I'm just wondering.

I mean, I mean, sure, if you want.

I mean, I know you're saying good governance and all that stuff.

I get it.

But I don't think.

Having either if you have a sunset date or if you don't have one, it doesn't stop Seattle City Council.

From working with Office of Housing and having central staff when whoever chairs housing again to keep You know, changing and being nimble to policy, market conditions.

Is the program working?

What I've seen in all these amendments and in the bill, when I looked at, believe it or not, it was around when MFTE started.

It hasn't stopped us from making it better.

I think the history, the record shows that.

So I guess I'm just trying to get a better sense of, I don't think this I don't think this, I mean, we can still do this stuff whether or not we have a sunset date, correct?

That is definitely correct.

And that's always true.

Even with the sunset date, council has changed the program in between sunset seats before.

Yeah.

Yeah.

So I don't, okay.

All right.

Thanks.

Thank you.

Council President Nelson.

Just a reminder that the renewal of the MFT program in general was supposed to happen last year, and then we had to pass legislation to allow it to be extended, I think it was the first quarter of 2025, and then that wasn't working out.

And then they asked if they, meaning Office of Housing, could extend to September of 2026. And then, that's right, as in next year, I think that was correct.

And then Chair Moore said, no, we should finish it September 2025. I'm saying all of this because it really does, it's hard work.

It takes a lot of analysis and outreach with stakeholders and et cetera to change a program.

So just letting people know why we're here right now with this one.

Thank you very much.

Any other questions or comments from the committee?

From what?

Any other questions or comments on the overall MFTE legislation and the amendments that we've discussed today?

Yes, Council President Nelson.

I don't know how to...

I say emphatically that we do have a housing affordability crisis, and this is one of the tools that we have to provide for more affordable units.

But I'll note that out of a billion dollar, actually $970 million housing levy, it supports the construction of about 400 to 450 housing units per year, or 3,600 units over the course of its eight years, but all of that is targeted at zero to 60 percent AMI.

So that does not provide an option for anyone earning between 60 to 90, 60 to 80, whatever this MFTE program is going to end up And we really do need to pay attention to that income bracket because those are our teachers, our artists, our bus drivers, the workforce, frankly, that is being displaced from the city of Seattle.

And so that's one of the reasons why I have always been such a strong supporter of this.

I noticed that the letter that was referenced in public comment that we received yesterday says something about, where is it, that the tax exemption costs the city about $20 million per year in lost tax revenue.

Okay, that's $10 million.

We spent $342 million in affordable housing in 2025, or at least that was the prospective budget number that we agreed to last year.

So my point is that if I understand that folks are concerned about developers getting any tax breaks, et cetera, and perhaps what I would consider an insignificant loss of revenue compared to the benefit that we're getting.

And one thing that is rarely mentioned when we're discussing MFTE and the benefits, it's not just that it provides, it incentivizes developers to produce affordable housing.

It is doing so within a mixed use building.

So when developers build a residential tower, they usually choose the fee on lieu option, which means that they're paying into a pot of money for affordable housing and not Liza Rankin.

Tanya Woo.

Liza Rankin.

Tanya Woo.

3,600 units over the course of eight years of the housing levy.

And I'm referring to page nine of the presentation that was presented on August 13th.

The MFTE program would produce 3,744.

And that is based on the over 10 years from the chart on that page.

So that's a lot of units.

And I will finally say one more thing, which is that There is no workforce housing that is supported in the housing levy except home ownership.

And this program fills a really important gap.

And I wish that our Habitat for Humanity, Ryan, could still be here because I've spoken with him before about how difficult it is to use some of the Constraints and barriers to building workforce level housing are completely different from building zero to 60% housing that our affordable housing providers are building.

So in any case, I really hope that we can...

I'm looking forward to getting this off our plate.

And moving on because, again, this is a program that I think is critical, is in our range of options that we have for building affordable housing for the people of Seattle.

All right.

Thank you, Council President.

Any other commentary questions from the committee before we end, before we excuse our presenters?

All right.

Hearing none, I have some questions, but I think I'll take those offline.

Primarily, I want to make sure that the amendments we're looking at, other than 8 and 14, which we know conflict, are there others that are glaring at you that go, ooh, yeah, these two, these three are button heads with each other.

So, again, that's a discussion we can have offline.

With that, we have reached the end of today's meeting agenda.

Thank you very much for joining us at the table and walking us through all the amendments.

Our next meeting will be Monday, September 22nd, 2025 at 9.30 a.m.

Is there any further business to come before this committee?

Hearing none, we will stand adjourned.

The time is 11.29 a.m.

Thank you very much, everyone.

Enjoy the rest of your day.

Thank you, co-chair.