Select Committee on the 2023 Housing Levy 41923

very much for joining the Select Committee on the 2023 Housing Levy for the Seattle City Council.

It is 9.30 a.m.

I am Teresa Mosqueda, Chair of the Select Housing Levy Committee.

We are going to call this meeting to order.

It is Wednesday, April 19th.

And Madam Clerk, would you please call the roll?

Council Member Herbold.

Council Member Juarez.

Council Member Lewis.

Present.

Council Member Morales.

Excused.

Council Member Nelson.

Present.

Council Member Peterson.

Present.

Council Member Sawant.

Present.

Council Member Strauss.

Present.

Council Member Stita.

Present.

Madam Chair, that is six present.

Thank you very much.

And as other council members join, we will make sure to welcome them to the select housing committee meeting as well.

Colleagues, this is our second meeting of April in which it's dedicated to hearing directly from the executive team that includes folks from the mayor's office, the housing office, including Director Winkler-Chin and Kelly Larson, We will also have with us Tracy Ratcliffe and Jennifer Lebrecht from Council Central staff.

I want to thank you all for the opportunity to dive into the proposal.

We've done a little bit of looking back at the previous levy, and then we will have an opportunity to, really in May, start diving into more of the details of what is in the proposal for the upcoming levy and what Councilmember questions and ideas might be.

We are going to go ahead and take public comment here at the top.

We have nobody signed up for public comment in the chambers here, and I'll give it a few more minutes.

We do have one person signed up for public comment online, but I don't see that they are actually present.

So, Kwan Wah Loo, if you are signed up for public comment, please do dial back in with the number that you registered with the public comment number that you use when you signed up for public comment earlier today.

Again, due to our ongoing hybrid nature and the ongoing pandemic, along with compounding complications from the flu and other communicable diseases, we are continuing to do a hybrid meeting.

Thank you to my colleagues who are both online and also folks in chambers.

I wanted to make sure that we welcome to the to the table, our presenters as well, who will always be with us remotely to reduce the amount of people who are in person.

And again, today includes an overview of the housing levy as transmitted by the mayor's office.

And if there's no objection, today's agenda will be adopted.

Hearing no objection, today's agenda is adopted.

The sole item on there being the mayor's proposed 2023 housing levy renewal package.

The presentation is linked on our agenda, including the proposed ordinance and the proposed resolution.

At this point, I just wanna confirm, we do not have anybody in chambers for providing public comment, and there is no one who has signed up for public comment online who is present.

We'll go ahead and close public comment, and we will go ahead and move on into items on our agenda.

Madam Clerk, could you please read item number one into the record?

Agenda item number one, Mayor's proposed 2023 housing levy renewal package for briefing and discussion.

All right, well, thanks again to folks who have been with us over the course of the meeting that we already had here in April.

This is the 2nd presentation on the mayor's proposed 2023 housing levy.

The 1st of 3 months dedicated to just talking about the housing levy in the select committee, which includes the membership of the whole.

So, thanks to all of my council colleagues for dialing in this morning.

Welcome back, our esteemed team from central staff that includes Tracy Radscliffe and Jennifer Lebrek, who are with us today.

We also have with us the Office of Housing.

Thanks to Director Michael Winkler-Chin and her team for walking us through the Mayor's 2023 Housing Levy renewal legislation.

And thanks again for the robust community engagement that you have shared with us in the past meeting.

We look forward to hearing more from you in the upcoming deliberations.

Are there any comments from central staff before we open it up?

I'm not seeing central staff jump in.

Nope.

Okay, that's an affirmative.

Nothing here.

And colleagues, just as a reminder, at the last meeting that we had on April 5th, we had a presentation from the Office of Housing, the Mayor's Office, Seattle Affordable Housing Community dialed in to provide public comment as well.

And we heard about the immense need for investments in workforce housing to continue to maintain, operate, and expand affordable housing investments.

The April 5th presentation helped us get a grounding of the data that we currently have.

And some requests were made by my council colleagues that central staff and the Office of Housing I think are still working on as well.

And we'll be providing a follow-up information both in today's presentation and anything else that's not answered today.

We'll seek to make sure that it's provided in the upcoming presentations or in the upcoming weeks.

What we heard from the presentation last time is that there is a severe shortage of housing in Seattle between 2011 and 2019. For every 2.6 jobs created, only one unit of housing was built.

This has led to escalating housing costs with a 45% increase, a 45% increase in rental costs over the last decade plus.

Our housing crisis is having a disproportionate impact on low income and BIPOC black, indigenous, people of color, Latino households who are experiencing higher rates of housing instability and also homelessness.

The King County Growth Management Planning Council projects that Seattle needs approximately 112,000 new affordable homes by the year 2020. excuse me, by the year 2044. And the greatest housing need is for the lowest end of the income spectrum.

Seattle needs approximately 30,000 new homes, new affordable homes and households with incomes of over 50% of the area median income or below.

To put a human face on the need, A household at 50% of the area median income, these are retail workers.

These are human service providers.

These are childcare providers.

These are teachers.

These are nurses and folks in the healthcare sector.

These are people who are just starting their careers in construction.

These are individuals who our community and our economy relies on to provide food, clean buildings, care for seniors and our families and more.

Importantly, these could be our neighbors.

These could be the workers that employers need in order to get their businesses up and running again.

These could be the diverse neighbors that we need in our city to make sure that we have a thriving Seattle.

Unfortunately, if we don't address this growing need and the known amount of units that are projected to be needed in Seattle, more people will get priced out of our city.

And the reality is more people will get pushed into homelessness due to the lack of affordable options in Seattle.

We see this tremendous need every day.

We see that there's disproportionate impact on our vulnerable neighbors who are experiencing housing instability and homelessness.

And we see this and we have heard about this ongoing in terms of the need within the workforce for permanent supportive housing investments to help keep people stably housed, get folks who were previously homeless into housing and keep them sheltered and housed.

The housing levy in front of us is an opportunity for us, of course, to talk about building the brick and mortar, the number of units that will be created.

It's also an opportunity for us to talk about first-time home ownership options, the supportive housing workforce to keep people housed, and the opportunity to create good jobs in this sector so that more people have the opportunity to really benefit from those units.

Because without additional workforce and workforce investments, we will continue to see people cycle in and out of homelessness or housing instability.

So I wanted to back up for just a second and provide a little bit more context to who we were talking about when we talk about the individuals who will potentially be able to benefit from building additional housing and the why it's so important to couple these investments with funds for the workforce to build housing and also to work within those new housing units.

Colleagues, with that, I wanted to give us a chance to dive back into the data.

We will look at both the data and the human need that is incorporated in the presentation, and to hear about the successful efforts from the past levy, the higher than anticipated units and services that we were able to invest in in this last levy, thanks to Seattle voters.

And we'll hear about the ongoing need for deeply affordable housing, permanent supportive housing, and the ways in which we've really tried to make sure that workers are centered in this housing levy, both in terms of construction and in terms of who is working within supportive housing units.

With that, I want to thank Council Member Herbold, who has joined us at the beginning of my comments as vice chair.

And we will note that you are also present.

And we'll turn it over to our Housing Department Director, Michael Winkler-Chin.

Thank you very much, Council Member.

I'd like to introduce my staff member here, Kelly Larson, who will be doing this presentation with me as well this morning.

So as Council Member Mosqueda said, I'm Michael Winkler-Chin, and I'm with the Seattle Office of Housing.

Can we see the slide?

It's a slide up.

There we go.

Thank you.

So to start our presentation on the 2023 housing levy proposal, I'm going to take a couple of slides to reflect on what nearly four decades of housing levy investments have done for our home city.

More than 16,000 residents are estimated to live in levy supported homes at any given time.

And to give you a sense of scale, thinking about the moment that we're in, that many people would fill about 93% of the seats at a cracking game.

And if we include the additional people who will be able to move into levy funded homes that are currently in the pipeline, either under construction or preparing for construction, then we would fill every single seat and then some at Climate Pledge Arena.

So this is the impact of steady investments over the years.

We have new homes opening and new families moving in every single year.

And as we continue to fund new projects, we're building that pipeline of future homes in our city.

As we look at the 2023 housing levy proposal, please keep in mind that we're building on the strong and trusted track record of past levies, going back to 1986. Every housing levy since 1986 has met or exceeded its goals because OH staff have worked hard over the past four decades to set ambitious but achievable goals, and OH staff, in partnership with housing providers, have continually worked to improve our processes to become more efficient, creative, and collaborative in the ways we fund and develop affordable housing.

So the proposal you'll hear about today is not only informed by market conditions and stakeholder feedback that we've been examining over the past year, but it's also informed by 40 years of doing this work and doing it well.

So we have one example here that's pictured with Jackson Heights and Patricia K Apartments located at the intersection of 23rd and Jackson in the Central District.

Community House, the organization that operates these buildings, helps people with severe and persistent mental illness through a supportive family atmosphere.

an alternative to traditional clinical treatment.

Jackson Heights was one of the first buildings in Seattle to use the community preference policy, ensuring that a portion of the homes in this building are set aside for residents with longstanding ties to the Central District to prevent displacement or to allow people to move back to the CD.

And this is a policy I feel pretty strongly about and worked on before I was here, back when I was at the SCID PDA.

And it's heartening, I think, to see how this policy is actually coming into play.

And so I'm very curious to see how this continues to work.

These two adjacent buildings provide workforce housing and permanent supportive housing, as well as ground floor retail.

So Catfish Corner, whose owner you see right here, Terrell Jackson, has that nice corner spot.

And I think this presentation is my favorite slide in this presentation because it's a community anchoring and community building development project.

And the residents who get to live in that building get to benefit from the housing, but so does the entire neighborhood by having the types of commercial space activity that really benefits them.

And so for me, this sort of project is really exciting.

So this proposal has been 13 months in the making from February 2022, which is before I got here, to March of 2023. And I'm going to walk us through a very quick summary of that year-long process, but you can also review a more detailed description of the engagement activities completed in the Community Engagement Report linked on the Office of Housing's levy website.

So from February to July, OH staff convened 10 meetings with affordable housing stakeholders, including housing providers, funders, and government agencies.

The purpose of this engagement was to understand the greatest needs and challenges currently faced by housing providers.

Following this early engagement, OH staff analyzed the feedback received.

The feedback informed the development of the initial housing levy proposal that was published in October.

Then OH staff also logged hundreds more comments through focus groups, as well as meetings and events with agencies, both internal and external to the city.

In total, Staff and members of the public representing 49 organizations were engaged and 38 formal public comments were received through in-person and virtual testimony at housing levy, technical advisory committee or TAC meetings, as well as written comments received via email.

So this slide shows the process for developing and revising the housing levy proposal.

From October to January, OH convened three meetings of the TAC to provide feedback through a collaborative and responsive proposal revision process.

The TAC brought together 20 technical and subject matter experts in the housing and homelessness fields to consider different investment in program options for the housing levy proposal.

TAC meetings were open to the public and included public comment.

Concurrent with the TAP process, we had a public comment period from October to January and hosted a series of in-person and virtual open houses for community to learn about the levy.

In the end, this is not just Mayor Harrell's housing levy proposal, this is our community's proposal informed by community needs and priorities.

So this slide summarizes all the conditions we considered when developing this proposal.

starting at the top two boxes.

The critical need for operating maintenance and services, which we call OMS funds, are one of the most frequently cited needs we heard from affordable housing providers throughout our year of stakeholder engagement.

These funds are needed to support existing and new housing while adding support for workforce sustainability and permanent supportive housing.

On that same level, we have the growing need for affordable housing citywide.

Given the staggering numbers we presented a couple of weeks ago, we knew we needed to increase our housing production goals with this levy proposal.

Going one step down, the orange box says new programming and innovation, which encompasses planning for the future, including building for climate resilience, improving environmental air quality, and investing in workforce stabilization.

This is all part of the continuous improvement we strive for at the Office of Housing.

And there in the green box, we have other public funds.

This refers to availability of other funding sources, such as low-income housing tax credits, the state housing trust fund, private debt, other city resources, for example, the jumpstart payroll expense tax and the resources generated from the mandatory housing affordability program.

And finally, across the bottom, underlying all the other considerations, we have cost drivers, including inflation, land and construction costs, and interest rates.

which we're all very familiar and have seen the impacts of.

We set housing levy goals in order to be honest and accountable with the voters.

And we always strive to do more with our housing team working as hard as possible to maximize the many fund sources we have to support project development and operations and stretch our dollars further.

This proposal presents the minimum we can achieve at this funding level.

And as we have done with every past levy, We're going to work hard to build and operate as much housing as we can.

We're looking at all the externalities that play into our investments.

We continue to work to bring more resources in collaboration with our federal partners, ensuring that each home lives up to its 55 plus year potential.

We look to decrease construction costs and to innovate.

These innovations are often improvements on existing processes and come from what we learned from our partners, some of whom owned and operated their units for decades.

We're also looking for enhanced efficiency and permitting, as well as process improvements and regulatory reform, including reducing permitting times because it lowers costs.

And as we improve our efficiency, we also want to make sure that we're not compromising on the quality of our homes or the health of our residents.

I'm going to wrap up this section with the values and principles driving this proposal.

The housing levy should grow to respond to increased housing costs, the growing needs of our community and meet the demands of this moment.

The housing levy should continue to deliver diverse affordable housing options while prioritizing households at the lowest incomes and the highest needs.

And the housing levy should continue to support buildings, as well as the people who work hard to make those buildings into safe, healthy homes.

OH staff have worked together to develop this proposal, exploring numerous scenarios and models, conducting research, analyzing data, learning from providers and other jurisdictions.

And I want to personally thank the OH team for all the great work represented here, as well as thank them for all the work going forward, because there'll be much work for them to do going forward.

OH expresses our gratitude to our partners who have supported this effort along the way and to those who implement our work and community.

And finally, I want to recognize once again that this proposal represents investments in peoples and homes.

Those 16,000 residents of levy-funded homes that I mentioned earlier, that's 16,000 children, sibling, parents, grandparents, neighbors, and community members.

They're the people that go to school with your kids.

They're the people that help your families function in the day-to-day.

They're the people who get you your coffee.

They're the people who take care of your kids and your elders.

All of these people are living right now in safe, stable housing that they can afford thanks to the Seattle Housing Levy.

Okay, now I'm going to give an overview of the 2023 Housing Levy proposal.

I'm going to start with a high-level summary of proposed program allocations and then I'm going to hand it over to Kelly who's really the wizard behind the curtain here, to discuss the details of each program proposal and the assumptions that went into the building of these programs and related goals.

So we are proposing a 700, sorry, a $970 million levy over seven years.

This results in a 45 cent tax rate with an annual impact of $383 for the owner of a median value home.

We are investing $707 million in rental production and preservation.

This is our largest investment area in the majority of the work at OH.

We are proposing $122 million for operating maintenance and services to support that rental housing.

This is the next largest program area of the levy at 13% of total program investment.

We are increasing our home ownership investments significantly to $51 million, more than five times the prior allocation.

And we're proposing $30 million to fund eviction prevention, homelessness prevention, and housing stability services.

We also plan to administer the acquisition loan program with up to $30 million borrowed from future years of the OMS program.

And finally, we're proposing $60 million for administration.

Kelly, I think I'm turning it over to you at this point.

Is Kelly frozen on your end?

Oh, Director McClurchin, I think now you're on mute.

It looks to me like Kelly is frozen because she's not blinking at all.

Hold on a second.

Let's just notice that too.

OK, great.

Happy to have you kick it off for her if you'd like.

I can also pause to see if there's any questions from colleagues.

I think Kelly's joining back in.

Well, I will say thank you for the page numbers.

You can see those clearly at the bottom.

And we'll take a question from Council Member Peterson.

Good morning.

Thank you, Chair Mosqueda.

Thank you.

Yeah, just for some of the slides that we've already gone through one moment here.

First of all, thank you for all the work that's been done on this proposal for going over the history of.

the thinking and outreach that's been done.

I know the executive branch has been working on this for a long time.

Of course, it's relatively new for a lot of us council members as we just recently got the details.

So appreciate your grace.

And as we're asking questions and seeking more information, I know many of my constituents remain concerned about the sticker shock when seeing a potential tripling of this particular property tax.

The Technical Advisory Committee, can you give us a little bit more information about who served on that?

I mean, are they people, are they organizations that currently receive levy dollars?

We had a bit of a cross-sector participation in the Technical Advisory Committee.

It included academics, nonprofit housing providers, partner funders, and private philanthropy.

I believe you also had members of the labor community there.

Correct.

Thank you.

And it would be institutions are banks.

And I think we saw a slide and last presentation categorized by sector if I'm not remembering if I'm not misremembering.

Yes, we have to share the list of those.

Okay, we'll grab that and we'll circulate that around Catherine Peterson, please go ahead.

Thank you.

And the reason I ask is what we've seen with other groups who are really passionate about a particular issue, and they may be also receiving funds from that source, the group tends to move toward a higher price tag and more funding from the source.

So it's just trying to get a better understanding of the costs so that I can explain to people why the number is so high.

The construction costs have gone up.

I think on slide eight, you were talking a little bit about some of these drivers.

In terms of bringing costs down and having a greater diversity of housing type, I visited Vancouver, BC back in 2019 to look at their efforts to reduce homelessness.

And they do a lot of manufactured modular housing.

It's very high quality.

Can't tell the difference from traditional construction.

So was there any thought of allowing for some manufactured and modular housing that is high quality like that in Vancouver, BC?

Because that brings the cost down, it cuts the cost in half so you could actually produce twice as many units with these dollars potentially.

Council Member, I can talk a little bit to that.

You know, when we did our permanent supportive housing, sorry, we are shifting and adjusting as we do this.

If you do remember, we have done, and we're in the middle of our pilot where we looked at doing panelized, not quite modular housing.

The Office of Housing has done modular homes before.

We did no G, Oh, Noji Gardens, which was a homesite project up in the Columbia City area that was modular.

We've also talked with colleagues in California that have done some modular housing.

And although this works great, some of the issues that we've seen with some of the modular projects, not in this state, but in other states and talking with developers of that is issues around long-term insurability.

of that and the fact that one of the biggest projects there ended up increasing their costs by 70% as they were hit by an atmospheric river.

So it's not anything that we do not, we are considering it, we just have to make sure that it is right for us.

And just trying to understand all the factors because it's not just the development of the housing at this moment, it's really how are you gonna operate it for 55 years?

And that's really, I think, a consideration for me.

Let's do one additional follow up and we have two other hands.

Yeah, I'm just going through the slides that have been presented already.

I think we were up.

Were we up through slide 12 or that's correct.

So I've got it so on slide 11 and then I'll then I'll pause and wait for the rest of the slides on slide 11. I believe there was an impact to the median owner of a or owner of a medium valued home.

That is, thank you.

So that's 383 and currently is it 114 approximately?

So it's going from 114 to 383. So it's actually more than tripling if I've got my math right.

Okay, so it's just helpful for me to be able to explain, you know, what are the people doing now versus what would they have to do in the future?

Thank you.

Thank you, Council Member Peterson.

Council Member Herbold, please go ahead, Vice Chair.

Thank you so much.

And I too am only going to ask questions about slides already presented.

And returning to the slide that Director Winkler-Chin identified as her favorite slide.

I'm a fan of that slide as well.

And it specifically is addressing Jackson Heights and Patricia K. Apartments and with Catfish Corner on the ground floor.

It's a great example of co-locating affordable residential and affordable commercial spaces.

And I just want to flag the fact Director Rinklachan is well aware, but for other folks, There is a group of stakeholders in my district Highland Park, specifically, who have long advocated for affordable housing with ground floor commercial affordable to small business owners.

and there's a specific piece of property owned by Seattle City Light.

It's not a straightforward thing to do, as we know, and as you, Director Winkler-Chan, have experienced yourself as a community advocate before coming to your current leadership role at the city.

But since you highlighted that particular development, I'm wondering, if you could speak a little bit to how the levy may contemplate more of this kind of co-location, whether or not the levy itself speaks to that, and what plans we might have for doing more of it.

So Council Member Herbold, thank you very much for that question.

I think you call it Highland Park, I think I call it Dumars.

That's the way it was embedded.

And I think that was really one of the first things that we discussed when I came into this role.

I don't think it would be a surprise for anybody that I think that these community development projects are one of the things that I like best, because I do believe that as a city, when we make investment, when we have the land and we make an investment in housing, we should actually consider how the greater community benefits from that.

That shouldn't be a surprise to anybody who hears me say that.

I think with a lot of our projects, we do envision that they are in these places because these high areas of opportunity, which is a later slide that we'll discuss, really do allow the benefit of these co-location of things.

And so it is really anticipated that a lot of these projects will do that.

And as we think about the planning for it, it has been incorporated in thinking, as well as who gets to live there, right?

I think throughout the Technical Advisory Committee process, Kelly will get into this in a little bit of detail, just how some of the shifts have happened that have allowed for us to really think about what these places should be, what these community benefits should be.

follow up?

Yeah, thank you.

Um, not so much a question, but just a recognition.

Um, Director Winkler Chin.

Uh, I think you very lightly touched on the community preferences policies that the city has been, um, actively working, working to implement.

And I just took a little walk down memory lane.

Um, and, um, see the record of how the city got moving in that direction.

And that was the result of resolution 31754. And that was one of the resolutions that accompanied MHA up zones, specifically the MHA up zones.

zones in the Chinatown International District.

And there's a section in that resolution that you are critically responsible for having it be included in the resolution.

And it specifically speaks to the council's desire to work with community and work with OH to develop these kinds of really, really important policies.

to make sure that as our city grows, as new buildings are built, that people who have been historically displaced from communities as a result of development can come back to those communities.

And there are, again, there are sections in this particular resolution that came directly from your work in community.

And I just wanted to call that out today.

Thank you.

Thank you so much.

I'm just going to add something real quick while we're on this slide, and then I'll go to Councilmember Nelson who has her hand up.

I think this is a great example as well of how we can think about the housing levy not just being an investment in certain numbers of units.

but really overall for our community and our local economy in Councilmember Herbold's district and around the corner from where I live in District 1. When I did a West Seattle Chamber tour last, I was walking up and down California Avenue and I asked one of the business owners there, If there was one thing that you would want me to do well on council, what would it be?

And this may surprise some folks who really think about there being this false division between what businesses might want versus what we want to do for working families.

The business owner said, look at that empty parking lot across the street.

And if you imagine that empty parking lot being housing that my workers could afford and childcare where they could have a place for their kiddos to go, then they would not be so stressed about having to commute an hour in to work and whether or not they were going to make it home on time to pick up their kids from daycare.

So I think it's a great example of how we can create small economic opportunities on the first floor, like the example here for Catfish Corner.

I think it's also a great opportunity for us to build on some of the policies that we've included in the MHA legislation that we passed a few years ago that incentivized child care spaces on first and second floors as affordable housing is getting developed along with mixed income housing.

And I think it's a great opportunity for us to think about what employers are asking for as we come, hopefully, out of this pandemic and try to create more economic opportunity and economic stability for small business owners, as well as economic stability for workers.

Uniformly people are asking for additional housing within the city so that workers can live next to their place of work, and that comes directly from employers and uniformly both from working families as workers, as well as entrepreneurs and small business owners.

They need places for folks to be able to go to have accessible and affordable childcare.

And as Council Member Herbold pointed out with the examples of the small retail space on the first and second floors, we can literally be creating a sense of place and space for new small businesses to open.

So this is why I think it's so important for us to think broadly about where these investments are going, how this investment is beyond the individual family or individual in the unit and how it's really a boon to our local economy as well, especially in this time as we think about resetting and reinvesting.

I'll turn it over to Council Member Nelson.

Please go ahead Council Member Nelson.

Thank you.

This is regarding the pie chart on the different programs that are funded, and then I'll have maybe other questions later.

But there are $34 million allocated for workforce stabilization for nonprofit staff, but it looks to me that there is no funding for workforce rental housing production for them or for artists or filmmakers or catfish corner workers.

Um, I do notice that there is a, uh, in the acquisition and preservation, there's up to 30Million up to.

80% AMI, but that's not really guaranteed, that's if there is availability.

So my question is, has the executive considered, as was done in the 2002 and the 2009 levies, allowing a small slice of that $707 million to be used for production for people earning up to 80% AMI?

or would you consider, can you just explain the thinking for, yeah, go ahead, I'll let you answer that.

So with the housing levy, we have multiple funding sources.

The housing levy has, we have historically used it to target those that are of the highest need and at the lowest income, right?

And we have multiple funding sources.

And we also do that by looking at the data, which shows that we have a high need for housing at or below 30% of AMI.

Now, if you remember here, I said that I'm giving a high level overview and that Kelly Larson on my team will go more into the details.

So Council Member Nelson, I'd like you to just take a pause on that.

We'll let Kelly go through some of the details on that and give you some of the thinking, and then we can pick up that question, if that is okay with you.

We're gonna switch seats here.

Oh, you're in two different spots there for a second.

Okay, hold on.

Great.

Okay, so we are headed back to the presentation and we're going to pick up on slides 11 and 12. And welcome to the virtual presentation table.

Kelly Larson, it says Michael Winkler-Shinn, but for the record, Kelly Larson is with us from the Office of Housing.

I'm currently submitting a ticket for a new laptop.

does not participate well with Zoom.

I'm Kelly Larson with the Office of Housing, despite the name.

So I'm going to be going into the technical portion of the presentation.

Jump in a few slides, Nathan.

So I'm going to walk through each program area in detail and share more of our key assumptions here.

Broadly, in order to develop these goals, we have used methodology we're competent in, a lot of public process and spreadsheet work to get here.

And at the same time, this is only one possible scenario of what could be developed.

Our models are not forecasts of the future, but they are built so that we can set realistic and ambitious goals based on the funds we have available and informed by those values and principles you just heard from Director Winkler-Chin.

All the dollar figures and production goals shared in this section are seven-year goals and cover the full levy period.

So I'll start here with the new rental production program.

These are the numbers that build the walls, doors, windows, and roofs overhead so thousands of people can live affordably in our city.

This is the majority investment of the housing levy, and we propose $707 million to develop new multifamily apartment buildings and permanent supportive housing for people with incomes at or below 30% of area median income, 50% of AMI, and 60% AMI.

This program will support the development of 2,881 new rental homes, like the 100 supportive homes you see in this photo of DESC's Bitter Lake Project North Star.

The buildings developed by this program range in size from 61 to 150 homes.

In terms of income targeting and restrictions, we propose the levy will require at least 60% of the combined rental production and OMS funds to support households at zero to 30% of area median income.

This is the same goal set by the 2016 levy, and it approximates the percentage of low-income homes needed at this level, according to the King County data we shared at the last committee meeting.

You can see other assumptions detailed here.

The levy and total per home cost that drive this model, so the levy contribution per home is $217,000.

The total per home cost is ranging up to $539,000.

This is averaged across the seven-year period.

You can also see on the right side, the cost to build different sized homes, the cost of land at the bottom of that first box.

You can also see the allocation of different area median income homes, the different incomes, and at the bottom, the different bedroom sizes that are planned for this housing levy.

Historically, the levy has been prioritized for senior housing and supportive housing for individuals exiting homelessness, which is why you see a focus on zero to 30% of AMI and on studios and one bedrooms.

Continuing on this first program category, I'll focus now on the preservation assumptions.

The housing levy will support reinvestment in 635 homes that exist throughout the city.

You can see here YWCA's fifth and Seneca building in downtown Seattle.

This is an example of a levy funded preservation project.

The Y is in need of substantial renovation to update the home so they're in better condition for residents for many years into the future.

This reinvestment program refers to major rehabilitation of the existing aging buildings in our city funded affordable housing portfolio.

These investments focus on significant updates, including roof replacement, upgrading major building systems like plumbing, electrical, HVAC and elevators, updating for climate resiliency or fully renovating or resizing homes.

So for the YWCA 5th and Seneca project, which is also a historic building, Reinvestment will include upgrading building systems, modifying fire protection systems, replacing all the water systems in the building to make it more energy efficient, and upgrading the elevators.

Structurally, the project will also need extensive seismic retrofits.

So the cost assumptions in this category are different because they're based on actual budget submissions, and the cost per home is approximately $279,000, with a levy contribution of $119,000 per home.

Now I'm going to discuss what we've traditionally called the Acquisition and Preservation Program.

This program provides short-term acquisition loans for land or existing buildings.

We fund this activity by creatively putting our operating maintenance and services dollars to work as soon as we have them on hand.

OH will continue to support up to $30 million for these short-term loans.

This is not technically a program investment area because it does not have its own dedicated funding source.

and we are thoughtful in issuing these short-term loans to ensure the funds will come back to the Office of Housing because we will need these funds to pay for our OMS contracts in later years.

Short-term acquisitions convert to permanent financing with resources from the rental production program area that I described just a minute ago, and this is where the homes are counted toward a production goal when they are fully funded as income-restricted permanent housing.

This program exists through the flexible, strategic, and innovative work of Office of Housing staff who are smart to think about putting these funds to use as quickly as they could and supporting our partners who are making important and timely investments in community.

I'll pause there if there are questions on these first three, maybe.

Thanks.

Thanks for pausing.

Council Member Herbold, please go ahead.

Thanks so much.

Yes, I do have a question about the acquisition loan slide.

Appreciate the clear distinction between rental production and preservation and acquisition loans, because I often get the categories mixed up.

The rental production and preservation program is not referring to preserving affordable homes by purchasing from the private market.

Rather, it's funding that's available for buildings that are already in the OH portfolio.

And have affordability agreements with with oh so it's it's funding to to keep those those buildings, operating and safe, whereas the acquisition loans is an area that.

I have a particular interest in this bucket of funding, a little bit aligned to the discussion earlier about the Dumar site, but much broader than that, as Council Member Mosqueda spoke to.

And I'm interested to know whether or not it might be time to consider not just operating it as a creative side of investment, but to concrete set a goal for the number of units.

and dedicate funding to get to this goal.

We know that the soaring costs of property and long timelines for construction and increased costs for construction are having an impact on the number of units that we can expect to bring online and are requiring us to increase investment to To, to even get a similar number of new housing units as under the previous levy although this this particular proposal goes further, but nevertheless, we saw from earlier versions that to just bring online a similar number of units as under the previous housing levy cycle, we would have to at least at that point look at at least doubling our investment.

So I'm just wondering whether or not it makes sense to more fully embrace a strategy of acquiring existing buildings and units from the private market perhaps existing property that might not have a building on it, but using that as a way to increase the number of units that we're able to bring online as affordable units and meeting our targets.

The other piece of this on acquisition is I think it can really be also used to increase the geographic dispersion of OH's investments.

We know from the prior presentation, the majority of acquisitions are in a handful of districts and neighborhoods.

And I feel like if we lean more fully into acquiring existing buildings and existing land, it might be easier to add affordable housing in districts that currently have little, like District 1, so that residents of all neighborhoods especially those at high risk of displacement.

Again, like the neighborhoods east of 35th in District 1 can stay in their communities.

We can see, for instance, OH really was committed to the idea of working to build affordable housing in South Park and that focus on that geographic neighborhood did result in some specific investments for homeownership in South Park.

And I feel like if we had a geographic focus and goals for acquisition, it would more drive as a strategy the kinds of outcomes that we'd like to see.

So just again, would love to hear your thoughts about that given sort of the current proposal, the current housing market, whether or not we've thought about how many buildings and how many units we expect to be acquired and have their affordability preserved over the course of four years and whether or not acquisition could be an effective strategy to increase geographic dispersion.

Thank you.

Please go ahead.

Thank you very much Council Member Herbold.

So the acquisition loan, as I think Kelly mentioned, is to purchase either land or existing buildings.

It's a short term loan, but we buy it, and as we go through, especially with occupied buildings, but it doesn't have to be occupied buildings, we use the short term acquisition loan to basically acquire, and then we will use part of that largest bucket, the permanent, what are we calling that?

The rental production and preservation pot.

That comes in and becomes the permanent loan for that property, if that makes sense.

So we might acquire it with the acquisition loan, and then we will take the due diligence time needed if it's a already developed building to go through and look and figure out, really work with the team and work with the buyer, the investor, and all of that to figure out the best financing and then to figure out what we do with the income levels, who we're targeting and all that.

So the rental production dollars do go in and buy new buildings.

And over the past, I have a list here of some of the buildings that we've purchased that were already built that we did not build.

And we have one, two, three.

14 buildings, 1,038 units.

Thank you, yes.

So, and we do have a slide later on that talks about some geographic targeting, if that is helpful for you as well too.

So hold that question once again, please do.

I'm looking over at Kelly.

Are we switching seats now?

I think I understand how the short-term acquisition loan program works with the rental housing production program.

My question is, can we, in this levy, not punt it over to the ANF plan, but in this levy, like we have for other categories, create goals for numbers of buildings and or units that we acquire and the funding associated specifically with the acquisition piece, either as a subset of the rental housing production, larger category, or pulling it out.

I would like to use goals to drive the outcomes we want to see.

I'm gonna ask for some time to think about what the implications of that could be.

So we will have to get back to you on that.

Appreciate that.

Thank you.

That sounds good.

I might also ask if central staff has any thoughts on this.

I think Council Member your last meeting comments prompted me to have a conversation with central staff too about some specific goals and wondered if Tracy, of course, is similar to director.

If you want to get back to us, that's great.

If you have anything off the top of your head related to some of those specific details that could be included in the housing levy versus the administrative and finance plan, that that would be great.

And we can also follow up later.

I think we should probably follow up later.

I think Director Winkler-Chin was getting at one of the complexities around this issue, which is it may be good to have a goal about this, but remember that the levy is just one source of funding that actually gets used to do some of these acquisitions, which as we found in the last couple of years has been very opportunistic.

It has been driven by a change in the real estate market.

It has been driven by the availability of federal and state dollars to allow us to do this.

And so we have had a very robust opportunity to do those kinds of acquisitions of those new buildings and some of the existing buildings that have just recently been completed, that we may not and don't know when we're going to have those next opportunities to do.

And so I think the combination of we have multiple fund sources that can come in to be brought to this activity and the uncertainty of when these opportunities come What might make it hard to have a like an annual goal, but it might make sense to have like a seven year goal that would actually, in my mind, sweep over, not just the levy but incorporate some of these other fund sources like MHA and gemstar because I know from looking at the investment reports that we have actually used a mix of different fund sources for.

for those acquisitions.

So I think it might be more appropriate that if there's a desire for the council to have a goal around this, that it might be that that is established in the housing funding policies.

That again covers all the fund sources versus it being a goal tied just to the levy, again, because I think multiple sources have been used for those acquisitions.

Those are my initial thoughts.

Okay.

Great.

We will get additional information to come.

Thanks for that reminder.

I'm not seeing any additional hands at this point.

Maybe some folks want to fold it into questions coming later.

So, we will go ahead and keep going.

Great.

Thank you.

So, for Operating Maintenance and Services Supports, or OMS, we propose $122 million.

All OMS funds support households living at 0 to 30% of their immediate income.

and are our lowest income neighbors.

In support of housing, we're supporting folks living closer to 10 to 15% of area median income.

In order to address the needs of people who are suffering outdoors without housing or those currently served by homelessness programs, this OMS funding is critical for deep rent subsidies and services to support long-term stability.

This program area pays for the staff that work 24 hours a day, seven days a week in supportive housing.

It pays to keep the water running and the lights on, addresses regular repairs and maintenance and janitorial work.

The majority of these levy investments will go toward OMS for newly developed homes.

With our partners, we will support 510 new homes with 20-year contracts, reimbursing for costs like staffing, electricity, and water, all the important components that transform our buildings into homes.

This proposal increases the per home contribution for OMS from 2,500 to 5,400 per home per year for a slightly deeper subsidy.

We're excited to share that this proposal also offers new programming with this workforce stabilization and OMS program component.

This funds permanent supportive housing providers who are facing serious challenges with workforce recruitment and retention.

This will support another 646 existing homes So the staff can keep doing their good work.

Residents may have received quality services and continuity of care.

And so providers can operate these buildings long-term, both safely and sustainably.

As you saw from the data shared at the last committee meeting, it is crucial that we stabilize our existing supportive housing by raising wages for the workers in these buildings.

We anticipate decreasing staff vacancies with these investments, which will better support residents programs and buildings.

And final note, supportive housing requires other fund sources, including federal, state, and county funds, and we will continue working with our partners to maximize the other OMS funds for these projects.

We propose 51 million to support homeownership, development, and stabilization programs for low-income homeowners.

Creating new high quality forced sale homes staves off displacement of lower income households from Seattle and creates opportunity for stability and wealth creation for households who would not otherwise be able to access homeownership here.

The types of homes developed by our nonprofit partners include townhomes and stacked flats, such as condos or cooperatives, or other missing middle housing types like the beautiful South Park cottages you see in this photo.

OH invests in resale restricted affordable for sale homes and is growing the stock of high quality homes affordable for households with incomes at or below 80% of area median income in perpetuity.

The OH team has been an active member of the Black Home Initiative and supports this regional effort to assist 1500 black low and moderate income homebuyers in Seattle, King and Pierce counties.

In total, these investments will support nearly 400 homebuyers and homeowners to obtain and maintain stable housing.

The majority of these investments, 90% go toward development of new permanently affordable homes.

We're proposing deeper investments in programs with this proposal, raising existing caps to address development needs in this time of increasing costs.

Approximately 5% of funds support down payment assistance for first-time home buyers and 5% of funds support home repair grants and foreclosure prevention loans to maintain stability for existing homeowners.

Let me pause on this slide real quick.

I was at that ceremony, that ribbon-cutting ceremony in South Park.

Council Member Herbold was there, and we had state legislators there, and who else was there?

Office of Housing, obviously, and the community.

But the reason I wanted to pause here, and Council Member Herbold, you'll remember this.

You can see the tree in this picture, and I think it's a great example of where we can build new and inclusive, denser housing.

and also do tree preservation and protection.

So that was a very large tree and we talked a lot about it being a place where kiddos would play and elders would gather and great example of preserving old trees as well as new trees that were planted around the area.

All right, that's my PSA.

Housing and trees do mix and are absolutely in in alignment with the plan here to create additional housing, dense housing, and to maximize opportunities for old growth as well as planting new trees.

All right, we can go on.

Oh, Council Member Holt, anything?

I was just wondering if this was a good time to take a pause.

Is this a good time to take a pause?

All right, I saw nods.

Please go ahead.

Okay, great.

Thank you.

Just going back to the workforce stabilization slide.

Of the, I guess it's $34 million for workforce stabilization and OMS supports.

I understand that some portion of that is intended specifically to increase worker wages in PSH housing, permanent supportive housing, and then a portion of it will go to deferred maintenance needs of these buildings.

34 million won't go too far when it comes to maintenance.

So I'm just wondering why are these two very different goals proposed for the same bucket of funding?

And if we've got sort of a ballpark of how much of the pot is intended for maintenance, versus wages and what mechanisms will be put into place to ensure that the bulk of the funding goes to worker wages because I believe that's the that's the policy objective for this for this particular bucket and again just as background addressing workforce stabilization is a high priority for this council.

Really appreciate that the mayor has included funds dedicated to this goal in the levy package through our public safety and human services committee.

We recently heard from a University of Washington led team of national and international scholars presenting the results and recommendations of in-depth research that the council funded into the pay penalty experienced by King County's nonprofit Human Services workers, which include those working in affordable housing.

So the research again was funded by the council in 2021, and it puts hard data behind the alarms that our mission critical nonprofit partners have been sounding since the pandemic.

began.

And the truth is, if we don't increase worker wages, we're ensuring that the critical services that we also provide funding for will not be available to those who need them, simply because few people are willing to apply for or stay in those jobs.

So I really appreciate that the levy package recognizes and addresses that for that particular segment of the worker caregiver population and really appreciate that it's not just the housing levy that's doing so.

The county's proposal for the crisis care center levy, the veterans, seniors and human services levy, they both include investments in increasing worker wages.

as does the Regional Homelessness Authorities Draft Plan.

So no one jurisdiction, no single funding source can do it alone.

And I'm really happy to see so much movement forward in braiding our different funding sources so that we can lift up the wages for the full spectrum of human services providers.

But again, would love to know just a little bit more granular detail of what we expect this $34 million to accomplish specifically as it relates to workforce stabilization.

Thank you.

Thank you Council Member Herbold and I wanted to add to that and a compliment to you as a co-sponsor of the Jumpstart Progressive Payroll Tax and ask in the answer from OH if you could also lift up the investments from Jumpstart which will complement the housing levy and the other fund sources that Council Member Herbold just noted specific to the workforce, the permanent supportive housing workforce, which is envisioned in the proposed levy to be married with this package so that we have greater stability across our housing systems.

Important to remember, given that the constant pressure is there to rob funding from Jumpstart, but the ways in which it complements the housing stability efforts in the housing levy is important as well.

So I'll turn back over to Office of Housing and then I see one more hand.

Great, thank you for these questions.

So yes, we've worked with our partners and our internal staff team to analyze our existing projects and staffing needs and we're offering these investments to be feasible for organizations to implement and to meaningfully lead to stabilization of the workforce so Councilmember Mosqueda is correct.

What we did was to review the entire investment portfolio, the Office of Housing, look at what is available.

And we did put a significant amount of resources from Jump Start toward this effort, workforce stabilization.

We are going to be talking about it later in this presentation.

So I'll wait till there to describe that in more detail.

But you will see Jump Start coming into this program area pretty significantly as well.

In terms of the majority of funds going to the workforce, that is the plan with this pool of funds, because it does take some time to increase worker wages because of organizations that implement a variety of programs, not necessarily all supportive housing.

are working with other funders and doing their own fundraising to bring more revenue to the table so that they can lift all of their workers together, particularly those folks who have collective bargaining agreements to pay attention to.

The goal is for year one to be about 60% of the fund focused on worker wages, and over the years of implementation, first one to five, to see that percentage increase.

up to 90% is the expectation going directly to frontline staff, direct service providers and their supervisors.

So that is what we are working toward.

This is our new program.

We're gonna be learning a lot in the next year or two and we look forward to coming back to share what we learn about the impacts in our future reports.

Thank you.

Council Member Peterson.

Thank you, chairman skater and similar to the earlier questions about the operating maintenance and services.

I think what will be really helpful and I know if you were to break out every line item.

there would be dozens of line items and to lump OMS together made some sense initially, though I think there are enough questions where we sort of want to see the different pieces that I would love to see a PowerPoint slide that breaks out or that keeps operating and maintenance separate from services just so we could.

And then also, I think later on slide 27, you're going to start talking about the sources of contribution of Jumpstart, et cetera.

But seeing it broken out with O&M together and then services separate just so we could, because in the services, that's where we're talking about the workforce stabilization, I think.

Is that right?

Because the O&M is just covering the basic operations and maintenance because those tenants won't have any income to contribute to the project expenses.

We've seen some evolution of the operating and maintenance category over the years, particularly when we're talking about supportive housing, which is exclusively what we are discussing with this levy investment area.

Operating also refers to the 24 seven front desk staff that run supportive housing.

So, and that is the majority of the personnel in the building.

So, and that's, we've been counting those folks toward operating costs with our federal dollars, our McKinney continuum of care funds.

So the personnel does stretch across operating and services.

We are working to align with this transition to OMS with other OMS funders, where we are now all really county, state, and COC more talking about operating maintenance and services together as one pot that is all necessary to make supportive housing run every day.

So we do have breakouts operating and services, but there are significant personnel costs in operating.

Thank you for that clarification.

All right, let's keep going.

Great.

So we are proposing $30 million to support short-term rental assistance and stabilization services for households with incomes up to 50% of their median income.

This program aims to support 4,500 households who are at risk of eviction or at risk of homelessness, supporting them to maintain their housing long-term.

This proposal offers a deeper investment, increasing the support for each household up to approximately $6,600, which is modeled more closely around OH's recent experience administering emergency rental assistance over the last three years with COVID relief.

There are three likely program investments in this area.

Resident Services in Affordable Housing, so not PSH, are affordable housing services that have been requested to support households who are at risk of losing their housing.

Homelessness Prevention Assistance and Services and Eviction Prevention Assistance and Services.

Tentatively, we expect to be dividing this fund three ways, and we're looking forward to more engagement with community as we further define this program.

Finally, approximately $9 million annually will support the engine of the Office of Housing, which is our staff team who are working hard every day to support partner organizations and Seattle residents.

Many organizations expect to run 15 to 25% for admin costs.

Here, administration costs represent 6% of the entire levy proposal, which is a lower admin percentage than prior levies.

The Office of Housing is a committed and efficient team, partnering with providers and contractors to make the most of these investments in our community.

Over time, we've continually improved, built more with less, and our office has historically operated very lean.

We'll continue to do all we can to ensure over 90% of our funds land directly in community projects and services.

And this concludes our overview of the levy programs.

All right, let's take a few questions here.

Council Member Nelson and then Council Member Herbold.

Yeah, could you go back to slide 17. I think that you do you, you mentioned that you don't know exactly how you're, you're still gathering input about that $30 million bucket but do you have a rough idea of how that will be allocated into these three subgroups, these three sub programs that's divided equally.

OK, thank you.

And when you said homelessness prevention and basically supporting people staying in their homes, have you ever considered just permanent rental assistance for for people to stay in their homes?

I am I'm really interested in Prevention and stabilization in general, because we know that keeping people in their homes is is much more cost effective than building new homes.

And so I'm keenly interested in this bucket.

But yeah, I just would like some information more on the homelessness prevention, what you're thinking about that part, and also the eviction prevention.

Right, so the intention with these programs is to really support folks who are right on the edge of losing their home because they're not keeping up with their rent payments.

They hit a crisis in their life.

We can step in and provide some services to provide stability for them.

You know, medical, an accident had occurred, something that's causing instability and that we can provide some short-term assistance to stabilize so that they're able to get back on track with their employment and take over their rent payments on their own.

That's sort of the intention with these short-term assistance programs.

We really believe in long-term assistance and support for folks who are low income, and that's what you are seeing in the OMS slides.

So those supports, those OMS supports are providing long-term and deep supports.

for people who are living with the lowest incomes.

But we are also advocating for more rental assistance from the federal government.

It's a big priority for the National Low Income Housing Coalition as well, to see more rental assistance come into our community.

We had great success with the COVID relief funds that came.

We administered about $70 million and it flew out the door real fast.

We were not able to serve everybody who needed service.

So this is an important part, but Primarily for this program, it really is to serve the other end of the spectrum of folks who are really in need of one time or somewhat short term assistance to maintain stability.

Could that assistance be in the form of just paying rent as well?

Absolutely.

Primarily, this will go toward rent.

OK, thank you.

And then I don't know if you heard my previous question about workforce housing now that we're done with the presentation.

There was a transition technological problems.

So I was yes, that was the question around 80% units.

Yes.

And yeah, I mean, we we can do new things in this levy.

I mean, the workforce stabilization bucket is new.

So and there is a history for workforce housing support in the housing levy in 2002 and 2009.

We have done very small percentages of resources, committed those toward those higher income units.

I think as these numbers, the data has been coming in over the last several years and we're looking at the need.

We're seeing the most significant need is at the lowest end of the income scale.

So zero to 30% housing faces the largest gap.

If we revisited one of those data slides from the last committee meeting, Approximately 62% of our need between zero and 80% is at zero to 30. And we're focusing our funds to match the need that we're seeing in the data.

But we are looking forward to conversation around income targeting for higher income units.

There's interest in our office to explore this more.

So we are considering this conversation over the next year as we're going into ANF plan and housing funding policy review.

And Michael's ready to take over here if we are ready.

Oh, I see.

No, we have a few more questions.

Sorry about that.

Okay, great.

So we are all the way through slides 18. Council Member Nelson, did you get through your questions so far?

Well, I just wanted to note that the previous, in additional slide, I believe it's on page 25, I think.

No, no, no.

It does talk about, I think that it's great that you did put in the breakdown of need at income level, because it looks like there's 22.6% of renters who are earning 51 to 100% AMI.

Thank you.

Good preview.

Thanks for including that.

Okay, Council Member Herbold, please go ahead.

Thank you.

And this is, as it relates to the rent assistance funds, this is a topic that comes up frequently in housing levy discussions.

There's a lot of interest in providing more eviction prevention, rental assistance, but I think it's important For us to remember that the levy is not the only source of funds to fund these programs.

There are, there's other other funding outside of the levy that is administered by, I think by the Human Services Department, and also funding that goes out directly to to our nonprofit providers who are a really helpful link with community members who need rent assistance and eviction prevention.

So it might be at some point helpful to get the full picture of the number of dollars and the number of people that not just the levy supports, but our other funding streams in this area.

But I actually wanted to talk about the resident services piece here.

From what I heard you say, about a third of the 30 million will fund resident services in non-PSHA housing.

I understand that amount will be supplemented with funding from other sources.

We're looking at about a total seven-year investment of, I think, $23 million.

And this has been a really big priority of mine, big priority of Chair Mosqueda.

We worked together to include $1 million for this purpose in the 2022 budget.

We know that the Office of Housing has received applications totaling about $2.5 million in requests for that $1 million.

So it's clear that the funding is sorely needed.

and even at a higher level than initially provided.

Really appreciate that this emerging need is included in the levy proposal, so it can receive steady and ongoing funding.

And its position within homelessness prevention makes intuitive sense.

We know that housing providers are using the funds to hire staff that help address the issues that residents face, including rent arrears, needs to help be connected to income earning opportunities, benefits, and other supports.

Just wondering that given that this is a relatively new area of investment, would love to learn more about how organizations are using the funding and if we have any information about the impacts or outcomes of the funding and the ongoing need for it and whether or not we're looking at some particular approach for reporting out on this resident services funding.

Thank you, Council Member Herbold.

Yes, we are reviewing the results that are of our current implementation.

of we use clipper funds to support resident services over the last two years, year and a half or so.

And we are, we're continually reviewing those program investments we'd like to pursue a consultant contract to do some more examination of what each program is providing and what are the services and scope of contracts that the Office of Housing would pursue next year.

So we're hoping to do a lot of that work this year and come back with more information for you all before we release funds or as we're releasing funds in 2024. And you are correct, the plan is for, just like we were talking about with the Workforce Stabilization Fund, These funds would also be supplemented by Jumpstart resources, and we'll talk about that a little bit later.

Any additional follow-up?

Okay, let's keep going.

Okay, we're switching chairs again.

All right, so at this point, we wanted to respond to a few questions that were asked on April 5th during our April 5th presentation and also share more about how OH funds would work together to support new housing developments and operations.

So this graph shows the affordable housing we were able to produce using all available city funds alongside the affordable housing we will need by 2044 according to King County Growth Management Planning Council.

And it's clear from these projections, the city alone can't keep up with the projected need.

So I think there was a question as to why is the levy growing?

It's growing because we have to try to meet this need for affordable housing.

This slide, Council Member Herbold asked last time about the difference in income levels for renters and homeowners disaggregated.

And this is a breakdown of income levels for renter and homeowner households in Seattle.

So for context, 52% of the citywide population are renters and 48 are homeowners.

And I think Council Member Nelson you had just referred to this.

Can you.

The AMI categories typically go zero to 30, 30 to 60, et cetera.

So at a later point, I'd be interested in knowing for the tranche that is 51 to 80%, how much of that is 60% and up?

Thanks.

So for clarification, how much of the 51 to 80% tranche is 60% and up?

Is that the question?

Yes.

OK.

Steph, you got the question?

Okay, we will respond to that later.

That's gonna take a little bit of math.

Okay.

Now we are going on to the next slide.

So geographic targeting.

So 55 years ago, the anniversary just passed last week.

I think it was April 11th.

President Johnson, Linda B. Johnson, signed the Fair Housing Act.

It was a year after I was born.

So it's been a while.

The city's obligation from the Fair Housing Act is to overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity.

And historically, we have done a lot to increase access to opportunity and mitigate risk of displacement.

So some of the emphasis areas, right, we've had those special opportunity areas for those that have been around the Office of Housing for 15, 20 years.

So we've had special opportunity areas for housing, And we as a city have identified areas of high access to opportunity and high areas of displacement.

And as you know, communities of color are disproportionately impacted by housing cost burden, displacement and homelessness.

Every office, a housing program and investment area consistently serves a higher proportion of households of color compared to the general population of Seattle.

But we still have a lot of work to do in terms of advancing housing justice and racial equity outcomes.

So if we go to the next slide, This is another, so Council Member Herbold reflected, I think, on my previous favorite slide.

This is probably my second favorite slide that we have.

And it is, it highlights OPCD's growth and equity analysis from 2016. And Council Member Mosqueda would not be surprised by me saying that this is one of my favorite slides.

Just because of the access to opportunity and displacement, right, on different axes.

We have that other visual that gets pulled out a lot.

So these maps show all Office of Housing Capital Investments made in 2022, both rental and homeownership.

And while this is just a one-year snapshot of OH investments, you can see there are geographic areas that we need to look at in order to provide choice and opportunity throughout the entire city to meet what I feel is the city's obligation outlined 55 years ago.

And as we consider what those areas are and where they are, and think about strategies to address those, we also need to think about future opportunities we will have to coordinate with other major infrastructure investments citywide.

Looking ahead to Sound Transit 3, what are the opportunities there for TOD projects?

So for those of you who may have forgotten, Wisbly, which is the West Seattle and Ballard Link Extension, is the largest public infrastructure project ever to be undertaken in the City of Seattle.

And an example of the TOD-type projects that we think about is Bellwether's Cedar Crossing at the Roosevelt Light Rail Station.

I think it's in District 4. And that was made possible thanks to a coordination with Sound Transit.

That development brings 250 affordable homes, many of which are family-sized, and on-site bilingual childcare right next to the light rail station, Roosevelt High School, and the grocery store that's across the street.

So we will continue to partner with Sound Transit to create more TOD opportunities like Cedar Crossing, as we all jointly plan ahead looking ahead to the future.

We are also committed to encouraging geographic distribution through policies in the Housing Levy Administrative and Financial Plan.

And this slide is how do OH funds work together.

So, as we mentioned previously, housing levy funds work together with other local funds, including proceeds from Jumpstart and the Mandatory Housing Affordability Program.

And as you can see, the levy is the only fund source that invests in all of these important areas.

But we need every single one of these sources working together to make a dent in our city's growing need for affordable housing, as you saw on slide 20. And I think Council Member Nelson, this kind of touches on part of your question about how, about workforce housing and 80% of housing and all these fund sources work together to help meet our range of housing needs across our city.

And I'm about- So is there anything in the jumpstart and the mandatory housing affordability that, where is the workforce for that?

I mean, how much is available for rental workforce housing?

So how much the dollar amounts for JumpStart and MHA, we have some estimates that have been predicted.

We'll have to get back to you because we do that as modeling.

That is actually one of the benefits of the housing levy that we have talked about before.

When we talked about predictability, reliability, we know what those numbers are going to be once the housing levy is passed.

And so the JumpStart and MHA is a little bit more flexible in what we can actually predict it being.

We can get you those numbers later because I don't remember them off the top of my head.

I'm looking off here to the side because I think Kelly and I are about ready to do a seat switch, if we can do that now.

Okay, here we go.

You can see Council Member Nelson in that prior chart that rental production funded by Jumpstart and MHA is limited to zero to 60% of area median income.

And we are making investments in homeownership that support households up to 80% of area median income.

Great, so you can see here both the housing levy and Jumpstart investment invests a majority of resources in new production of rental housing.

You can also see Jumpstart is dedicating over a third of overall funding to operating maintenance and services.

While the housing levy builds permanent supportive housing, Jumpstart provides a high percentage of the funds to stabilize the existing supportive housing workforce and support new and ongoing operating maintenance and services.

Homeownership investments are comparable between the two fund sources at 5 and 6%, and prevention is funded only by the housing levy.

I'll share a little bit more detail here on the first two program areas.

And I think it's important to note on that previous slide and that makeup, this is current law.

This is our statute.

This is why we have created a separate fund so that we can continue to maintain investments in the categories that Jumpstart had articulated in the unanimously endorsed and voted on spend plan.

I just want to make sure that it's clear that this is what is possible if that funds are not robbed to backfill other sources.

And this is also a conservative estimate.

So this continues along the same lines that we negotiated in the budget with the mayor's office to ensure that the amount that was codified in statute in 2020 was going into these services and higher than anticipated was going into the general fund.

But as we see projections for Jumpstart not coming in at the higher levels that were anticipated in the fall last year, and we see the general fund revenues coming in higher than anticipated, it's important for us to be able to maintain the balance in the general fund investments by using general fund revenues as originally planned, but they were just down at the time so I want to make sure that folks know that the codified spend plan that correlates with jumpstart allows for us to make these investments and that's why it's really important that we walled off we siloed off those investments so that we can continue to make um, resources available for items that were historically backburnered like investments in supportive housing services.

So another critical example of how these funds get married with other investments and Councilmember Herbold noted a few of the other levies that are out there also codified in statute and large amount of voter approval and public eyes on how those dollars are being used, very similar to JumpStart.

So important for us to maintain our commitments and our investments in those categories as directed in the spend plan.

You can continue.

Great.

So earlier I walked through the rental production information for the housing levy, which is on the left side.

You can see the JumpStart rental production estimates on the right side of the slide alongside the housing levy goals.

These production outcomes are based on estimated JumpStart and MHA funds collected over the course of the 2023 housing levy period from 2024 to 2030. You can see JumpStart amplifying housing levy investments, supporting the development of over 2,000 new affordable rental homes and the preservation of an additional 600 homes.

JumpStart also supports the Community Self-Determination Fund, which acts as a capacity building and loan fund focused on supporting community-based organizations and BIPOC-led organizations that are interested in pursuing housing development.

For operating maintenance and services investments, I walked through these housing levy investments on the left.

So now you can see the jumpstart OMS spend plan on the right side of the slide alongside our housing levy goals.

Both fund sources invest in operating maintenance and services for new supportive housing.

Jumpstart will provide an estimated $111 million over seven years for new and existing OMS contracts, which started in 2022. Both fund sources work together to provide the Workforce Stabilization OMS Fund for the existing portfolio of approximately 3,900 permanent supportive homes now in operation or in the near future pipeline.

Jumpstart contributes $171 million over seven years for this crucial activity.

Referring to Council Member Herbold's question earlier, you can see resident services here.

Jumpstart will fund non-PSH resident services with $26 million over seven years.

And once we settle on a final spend plan for the prevention program area, any investments that are shifted in the prevention area to resident services will be offset in this Jumpstart spend plan, and dollars freed up will go into new production.

Finally, Jumpstart will fund the expiring 1986 and 1995 levy O&M contracts that are facing funding cliffs with $10 million over the seven year period.

And this concludes the presentation.

Great.

I see a hand comes over.

Is that an old hand or a new hand?

Actually, it was an old hand, but I did.

Go ahead.

One of the things that I've asked about that I didn't see covered in the first or the second presentation relates to.

properties that are currently in the OH portfolio, but that have lapsing or expiring affordability requirements because of the length of time that they've been in the OH portfolio.

I'd really like to know the total number of units and or buildings that will come to the end of their affordability agreements with the Office of Housing over the course of the next levy.

I also want to make sure that we're working together to create a deliberate strategy for buildings whose affordability is at its end and that that strategy is focused on preserving affordability if possible, in partnership with the owner, and if not, with the current owner working to preserve affordability with other interested potential providers.

I think, again, a goal would be a strategy that counts and tracks properties whose affordability agreements are nearing an end, require outreach from the Office of Housing in the years ahead of lapsing, to explore whether the city can support the provider to extend affordability, and then develop a package of options that could be offered to lapsing buildings that could support ongoing affordability, resident communication, organizing, relocation, trying to maybe link up the expiring affordability in buildings with our notice of intent to sell policy and considering designating a pot of funding for deferred maintenance available only to those buildings if they agree to extend affordability.

We know of a couple of examples of some properties in a more of a ad hoc fashion, having this expiring affordability and properties being sold to get out from under that ongoing obligation.

And really, I think this is an important part of our long-term affordability and anti-displacement strategy that I would really like to see some focus on in this levy.

Thank you.

Thank you, Council Member Herbold.

We'll get back to you on those questions.

We did see that, and that is one of our to-do list items.

Thank you.

Okay, great.

Thank you.

Council Member Peterson, please go ahead.

Thank you, Chair.

Now that we're at the end of the slide deck, I've got about five questions that go back to the slides that we most recently started with.

So thank you.

I had asked at the last meeting about the vacancy rate in the Office of Housing Portfolio.

The last time that I think a full set of data was provided where everybody had replied from the housing providers, it was around 5%.

not including projects that are leasing up for construction.

So I'm still hoping that we can get final answers on what the current vacancy rate might be, assuming all the housing providers have provided that data.

So I can keep going with the comments or questions.

Let's see.

Council Member Peterson, I can respond to that.

From the data that we have, the staff have analyzed for the 2022 annualized vacancy rate where the portfolio is 3.95%, which is less than the 5%, which we have held as a standard for multiple years.

And that 5% standard is actually less than some of the other major high cost cities that we've been in contact with.

So if I may go into that a little bit further, my understanding is that 4% Vacancy does not include several housing providers, but they have not yet responded.

Um, and I think this is part of the issue I'm pointing out is we don't have real time data on vacancies.

And if they haven't responded, I'm wondering if their vacancy rate is perhaps, um, higher than average.

Um, so I wouldn't quote that 4% figure, I guess, until, or I'm not comfortable with it until everybody's replied.

Um, And I know that I central staff did provide vacancy data for other jurisdictions and nationwide but it wasn't.

for low income housing.

And the data that is available for low income housing nationally is 2% is the standard.

So I guess I just wanna keep this issue going that whatever we can do from asset management standpoint, if we can get more frequent access to this data to see what supports are needed from certain housing providers to get that vacancy rate down, So that we're, because our goal is obviously to get everybody into those units so that we reduce homelessness and so I just really want to focus on that going forward.

Councilmember just to be clear from the data that we have at this point, it is 3.95, I'm unclear as to what the 2% standard is that you referred to.

The source of my data as to what the standards are in other cities is I asked them.

And I asked the cities, I think Chicago, New York, Los Angeles, San Francisco, Miami, Boston, and Denver, just what their standard is, right?

And across their portfolios.

And depending on where we are in the point of time and what is the data that they are using and whether they are under communities of care, is that the right COC?

The continuum of care, those vacancy rates may fluctuate because it's a point in, it is not a point of time count, it's an annualized count.

And if you have a Section 8 waitlist, the vacancy rates oftentimes stretch out.

If you're going through a very specific protocol, your vacancy times can exist and extend.

Yeah, just to answer your question, the information I'm getting is from Moody's analytics which from from Reese data, and they say that low income housing taxpayer projects across the nation, it's a range of 2% to 2.6%.

for a vacancy.

So again, I'm focused on the low income housing stock of those cities, not just general housing stock.

Yeah, understood.

I'm going to have to go back to Moody's because I'm unfamiliar with that fun source.

Okay, I also want to add to this I think it's important to look at some of our local providers I think this questions come up a few times and the team that partners with the Chamber of Commerce to do the housing connector program.

continues to come up with the same numbers of vacant units and I think a really helpful local explanation of why.

So some of those issues are things that I've talked about before wanting to address like helping to make sure that people who have, you know, perhaps don't have a driver's license can have alternate forms of identification that can be used by landlords as we're trying to get people housed and housed quickly, this came up from the opportunity to sit in at the regional homelessness authorities.

I think daily briefing that they do and the housing providers that are in the room, including members of the business community from We Are In and others, were collectively talking about the barriers to getting people placed into affordable housing quickly.

One example that came up is how we can help people get the identification needed and increase education about what actual identification is needed.

You don't need a government issued form of identification as a requirement in most housing to get approval.

You just need an identification source.

So helping to increase access to identification.

is something that we could work on, but there's a number of reasons that there's barriers and there's a number of reasons that there's turnover.

So I just wanted to add that as additional context off the top of my head, and we can do some additional follow-up with Housing Connector, with the chamber and the businesses who are working with We Are In, and a number of other groups, you know, who are working to serve folks at the very lowest income, as well as folks who are doing that as philanthropists and coming from the business community to really compare notes and provide some qualitative data to complement any quantitative data.

Thank you, Chair.

And for me, whether it's 4%, which is 640 vacant units, or 5%, which is 800 vacant units, I think we all want to get that number down.

And the more frequently we have the data, we can help respond and provide supports if needed.

So I've got four more questions here.

I can just run through them.

OK.

Thank you.

Regarding the slide 23, thank you for showing that high risk of displacement map.

Really proud to have the Cedar Crossing project in my district.

That map is showing that the university district has a high risk of displacement.

I know that that land costs are high in urban centers and near light rail stations.

And so I think it's a real opportunity that we have again with a sound transit project there on Roosevelt and 45th Street, which currently is home to Over 35 people experiencing homelessness and a tiny home village there so hoping that that sound transit partnership continues there for that project.

Slide 26, which talks about the rental housing production.

Those figures, the $707 million, that's over the seven-year proposal as I understand it.

So what I'm trying to understand is the $615 million number from Jump Start and MHA because The latest economic forecast for 2024 is 280 million for jumpstart that's in 2024. And I thought the rental housing portion from that was.

60% of 82%, which is basically 50%.

So $140 million from jumpstart over seven years would be $980 million.

And then the MHA revenue was $75.7 million in 2021 and $75 million in 2022. despite headlines, it's relatively steady.

So 75 million times seven years is 525 million.

You add those two numbers together, you're up to 1.5 billion over seven years when you combine MHA revenue and Jumpstart revenue.

But I'm seeing a number that's less than half of that 1.5 billion that I'm coming up with.

So just wanted to understand the assumptions of how you're getting to the 615 million for Jumpstart and MHA.

Council Member Peterson, you just went with a bunch of different numbers.

So first of all, they're conservative estimates.

Second of all, we will get that to you.

But the 62% that OH gets is not all going to capital.

There is a significant amount that is going into OMS, the operations, maintenance, and support, right?

And so We can get you those numbers on a spreadsheet, and then you can compare them with your numbers but we are getting jumpstart and mha, they're both conservative projections and the entirety of the amounts that we get from jumpstart, do not just go straight into this capital budget.

And then in terms of the number of units that are produced, I saw in an earlier slide that OH is predicting an average of about $217,000 per unit out of the 539,000 per unit.

Is that the same ratio of output for Jumpstart and MHA?

Because I would, I'm thinking, you might be able to get more than the 2,041 homes, but is it the same to 217,000 for those sources of funds?

Maybe not because, well, you just said Director Winkler-Chin that more of it's going to OMS.

Correct.

The modeling is a little different between jumpstart and MHA and levy as well because the types of homes developed are slightly different.

So as, as I said earlier, the housing levy historically invests in permanent supportive housing and senior housing.

0 to 30% AMI homes, smaller bedroom sizes, zero studios and one beds.

Jumpstart on MHA will be investing in more 30 to 60%, though it is doing the full continuum of income ranges as well.

but also developing a higher percentage of family size units in Jumpstart and MHA and different types of financing.

So we're maximizing our utilization of the 9% tax credits in the housing levy model.

The Jumpstart model is accessing 4% tax credits and non-MyTech deals.

They're just slightly different models, which is why you can see there's different production goals associated.

Thank you very much.

Thank you, Chair.

Oh, thank you, Council Member Peterson.

Are there additional questions?

I just have I just want to respond to something that you mentioned, which was housing connector.

And that is a really successful program that in your committee, you had a presentation and they were so effective in working with their private partners, Zillow and getting people into housing that they actually had.

I think it was a half a million deficit in in their funding because demand was so high.

So that is an innovative program that when we're talking about rental assistance, I'd be interested in exploring further too.

Thank you.

Thank you, Council Member.

We'll see if we can have them back again.

Wanted to ask a few questions here about our workforce and really lift up the opportunity to talk about the impactful aspects of the housing levy.

We've talked a little bit about the workforce and maintaining and increasing operation and maintenance.

by investing in those who provide services to folks within the housing units, whether it's as frontline care and case manager, as Council Member Herbold commented on.

But I also wanted to really compliment the work that has been done collectively with the building trades and MLK labor.

I think this follows a history of us wanting to make sure that public dollars are going into the public good.

King County, for example, the levies that Council Member Herbold noted earlier, have really great labor language in them as we think about the Vets and Human Services levy, the levy that's on your ballot right now, vote by April 25th for the Communities of Care, the proposition that's out there that has important labor protections as well that this council sent a resolution in support of.

And Sound Transit.

We have some great levies that voters have approved that have included strong labor protections for building our connected infrastructure across the region as well.

So I just think it's so important for us to be constantly thinking about the ways in which there's broader impacts of our proposal that's in front of us that continue to build out and support working families and our local economies.

Is there anything else that you'd like to describe in the companion resolution that's coming down that will also complement the housing levy just for purposes of orienting us here, particularly investments for.

are folks that we're seeking to improve access to in BIPOC communities, folks with disabilities, veterans, seniors.

We, I think, have a strong focus in the housing levy that's complemented by some of the policy goals and the complementary resolution that's coming down.

So anything else that you'd like to highlight from that, and we can also defer to central staff when we go through the proposal in more detail coming up in May.

I don't think we have anything further to highlight from the resolution, but we did cover a lot of that.

The wage equity study was referenced from Council Member Herbold, reference to the resident services, the Workforce Stabilization Fund, and our other labor partners that develop our homes, as you referenced just now, Council Member Mosqueda.

Thank you so much.

All right, anything else?

Council Central Staff, Tracy Retzliff, I see you on screen.

Would you like to add anything else?

Council Members, if questions are done and you're finished with your comments and questions, just wanted to give folks an idea of what's coming next.

So if you're ready for that, I am happy to talk through next steps on the housing levy consideration by council.

Great, please go ahead.

Okay, cool.

So council members, you know that we are scheduled to meet again on the 3rd of May.

And at that meeting, central staff, working with all of you over the course of the next few weeks, will bring forth identified issues and options that council members are particularly interested in wanting to pursue in terms of potential changes to the mayor's proposal.

So council staff will be working with you to identify those, and then we will plan to come back at that May 3rd meeting to begin the discussion of those interests by you as council members and any issues that we as central staff might also identify as potential issues for your consideration.

Okay, thank you.

Short and sweet.

Tracy, anything else?

Director Winkler-Chin?

Just wanting to thank very much the City Council today and Council Central staff, as well as all the OH staff as we've rotated chairs multiple times in my office.

Thank you very much for the presentation and for doing the musical chairs that worked well.

Actually, we could hear you and see you both.

Okay, colleagues, I'm not seeing any additional questions right now, looking around and online.

Thank you for your active participation as well.

Great questions, and I think additional follow up has been committed to, so thanks for the work that you Office of Housing will be doing on some of those questions maybe in partnership with central staff as well.

And before we conclude for today, a whopping five minutes early I wanted to encourage people to sign up for public comment today, public comment will start at 430 this afternoon.

If you'd like to provide online public comment, their link will go live two hours prior.

So that would be two thirty this this afternoon.

Please do sign up remotely to provide public testimony.

We will also accept your public testimony in person and we'll be back in these shares this evening to hear from anybody who would like to provide public comments on this Seattle.

housing levy renewal package that we have been discussing over the course of this month.

And we will take that public comment into consideration as we think about its final passage from Seattle City Council before the end of June to be transmitted to the mayor's office to then be transmitted to your ballots by this November.

Again, our next meeting of the Select Housing Committee will be today at 4.30 p.m.

where we will hear from members of the public or the entire time dedicated to community public comment.

The next select committee on the housing levy will be scheduled on May 3rd at 9.30 AM.

We will have a discussion of the housing levy as has been summarized by Office of Housing over the last two meetings.

I believe at that point, central staff will really take over with the analysis and comments.

and TSF for any potential modifications that central staff sees and building on the comments that you colleagues have shared thus far.

That will get us into at least two to three meetings on potential modifications before we consider final passage in mid June.

Easy peasy.

Thanks colleagues.

This meeting is adjourned.

We'll see you at 4.30 for public comment and public hearing.

Take care, everyone.

Thank you.