Seattle to vote on funding for social housing

When Seattle voters said yes to creating a new developer of publicly owned housing in 2023, one question was left unanswered: how it would be funded.

Now, on Feb. 11, city residents have the chance to answer that question.

On ballots that went out last week, voters have two choices to make to determine the future of Seattle’s newest plan for housing.

The first is whether the developer should be funded at all. The next choice — regardless of the previous answer — is how.

Option 1A is with a new tax on all earnings over $1 million a year. Backers hope the 5% tax would raise as much as $50 million a year to be spent on buying and, eventually, developing housing that would be cost-controlled and owned by taxpayers.

Option 1B is to fund the developer with $10 million a year in existing city funding — specifically the city’s JumpStart tax on large corporations in Seattle.

The confusing flow chart of choices for voters gets at the heart of the fierce debates over housing and taxation in the city.

The new developer is trying to solve the problem of affordable housing for Seattle’s working-class families — a space that exists between the free market and the more deeply subsidized spaces for very low-income people.

Its north star is Vienna, where 80% of the population qualifies for public housing. The buildings developed and owned by the public under this model would house people of varying wealth, all paying no more than 30% of their income, as a way for the richer residents to subsidize costs for the poorer residents.

“You can’t attack the real problem without addressing the need for middle-income housing,” said Roberto Jimenez, CEO of the social housing developer.

The developer has been sluggish out of the gates since its establishment in 2023. Startup funding from the state and the city was slow to reach its bank account and Jimenez wasn’t selected until July 2024.

Nevertheless, Jimenez said he’s confident the body will be ready to hit the ground running should voters approve the new funding.

Backers of the proposed tax say this new stock of housing should be built with the help of the city’s richest residents.

Tiffani McCoy, who runs the House Our Neighbors campaign in favor of the tax, said the new dollar stream would represent a small course correction to the state’s regressive tax code while creating a source of funding for housing independent of the federal government.

“If we really believe that housing is a public good and we want to address the pipeline into homelessness, we should be investing boldly now,” she said.

Those opposed to a new tax — but not necessarily the larger goal of the new developer — prefer that the city use dollars it’s already collecting. Members of the Seattle City Council, Mayor Bruce Harrell and the Seattle Chamber of Commerce have pushed for this approach, placing option 1B on the ballot after the successful signature-gathering campaign for 1A.

Rachel Smith, CEO of the Seattle Metropolitan Chamber of Commerce, said she supports experimenting with social housing. But she opposes the proposed tax, saying the developer is not ready to collect and spend $50 million per year in perpetuity.

“It’s hard for me to see how this organization with one single employee, no plan, no CFO, no Chief Development Officer is going to be ready for prime time,” she said.

By pledging preexisting dollars to the developer, they’ll have “guardrails,” she said, and help from the city’s Office of Housing.

At the same time, others view the whole mission of the developer as flawed and advocate for voting against its funding at all. The focus on middle-income people is misguided at a time when there are so many homeless people living in the city, they argue. Additionally, the fact that the tax has no sunset date means there are few opportunities for accountability.

“Over two dozen nonprofits have a decades-long, proven track record of building housing for the poor in Seattle,” argue Alice Woldt, Roger Valdez, George Howland Jr. and John Fox, the group urging a no vote in the voting pamphlet. “That’s where these millions need to go.”

McCoy counters that, because this is a new source of funding, it would not detract from other housing developers. “We don’t see it as a zero-sum game,” she said.

The campaigns for 1A and 1B have both attracted significant spending.

The House Our Neighbors campaign, supporting the new tax, has raised $160,000. Most of that comes from the Inatai Foundation, a foundation created when Group Health Cooperative was sold to Kaiser Permanente and aimed at providing “community-oriented and equity-focused” grants.

The People for Responsible Social Housing campaign, in favor of 1B, has raised $227,000, much of it from business interests in the region. Microsoft gave $100,000 to the campaign and T-Mobile gave $20,000.