Dear Andrew,

Thank you for sharing with me your thoughts about the proposal to
reauthorize the multi-family tax exemption program. I wanted to take a
few moments to update you on the progress of this legislation.

Tuesday, March 2nd in my Housing, Human Services and Health Committee
meeting, I introduced a substitute ordinance amending several provisions
in the Mayor's initial multi-family tax exemption program legislation.
The amended ordinance:

·Requires developers to provide greater affordability (lower rents) for
units set aside in exchange for the 10-year property tax exemption.
More specifically, housing developers would have the option of setting
- 20% of new units at 60% of median income (1 person household rent of
no more than $817/month); or
- 25% of new units at 65% of median income (1 person household rent of
no more than $886/month); or
- 30% of new units at 70% of median income (1 person household rent of
no more than $954/month)
·Reinstitutes a right of first offer provision giving the City of
Seattle the opportunity to purchase or work with a non-profit housing
provider to purchase a project developed under the tax-exemption program
to preserve affordable housing if the owner puts it up for sale.
·Adds language that specifies the rental rates for units set aside as
affordable would not exceed 30% of annual median income for eligible

My proposal does retain the eligibility of all 17 neighborhoods for the
program including South Lake Union, Capitol Hill and the University
District, as proposed by the Mayor.

My substitute ordinance passed out of committee by a 3-2 vote with the
support of Councilmembers Jan Drago and David Della. Councilmembers
Richard McIver and Nick Licata voted against the ordinance. The
legislation will now move on to the Full Council for final action on
March 15.
Later this week, a divided report reflecting the views of
those in favor and opposed to the substitute ordinance will be

I approached my review of the proposed multi-family tax exemption
program with careful consideration given the shift of property taxes
involved. I wanted to ensure that the City was obtaining public benefit
in exchange for a tax incentive to stimulate housing development in

What I learned through hours of public testimony from residents,
non-profit and private developers, and labor and environmental
stakeholders was that particularly in the three neighborhoods (South
Lake Union, University District and Capitol Hill), there is a growing
need for moderate income and workforce housing where I was initially
skeptical about the justification for this program. Given the few
incentives available at this time for the development of housing in the
60 * 70% of median income range, I want to make sure we don't lose
an opportunity to create affordable workforce housing now, when these
neighborhoods are experience rapid growth and economic development.

With the help of your comments and public testimony, I feel the new
substitute ordinance balances the program incentives with our community
needs. My feeling is that neighborhoods that are experiencing a housing
boom need to offer options across all income levels. The middle class
shouldn't be priced out of rapidly growing neighborhoods. That's why it
is important that the program's scope is broad and inclusive of these
communities in addition to those lagging behind in their growth targets
and identified as economically distressed. Encouraging mixed income and
multi-family development in urban villages is critical to our long-term
growth management strategy here in Seattle.

If you would like more information or have any questions about the
latest proposal, please feel free to contact my office at (206)

Thank you for your interest in this issue.

Tom Rasmussen
Seattle City Council
Chair, Housing, Human Services & Housing