Task force: Don't require developers to build affordable homes

JARED PABEN

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A housing affordability report says local governments should give developers carrots to build affordable housing, but they shouldn't wield a stick to require it.

The controversial suggestion is part of a recently released report by the Countywide Housing Affordability Taskforce, created by Bellingham and Whatcom County to suggest ways to create up to 11,000 units of housing for low-income people by 2022.

The task force voted down recommending mandatory inclusionary zoning, land-use rules requiring developers to price a percentage of homes in a project for low-income households.

READ THE REPORT

To see a draft of the Countywide Housing Affordability Taskforce report, go to www.cob.org/government/public/chat, click on "Materials by Meeting Date" at the right and select the links under the July 18 meeting.
MEMBERS OF THE TASK FORCE

Tom Beckwith of Beckwith Consulting Group was hired by Bellingham and Whatcom County to draft a report with the guidance of the Countywide Housing Affordability Taskforce, composed of the following people:
- Seth Fleetwood, County Council member (task force co-chairman)
- Terry Bornemann, Bellingham City Council member (co-chairman)
- Ralph Black, Alliance Properties
- John Harmon, Bellingham/Whatcom County Housing Authorities
- Gary Reid, Gary Reid Homes
- John Shorthill, formerly of Habitat for Humanity of Whatcom County
- Paul Schissler, Kulshan Community Land Trust
- Ted Mischaikov, M:KOV Corp.
- Larry West, North Coast Credit Union
- Gail de Hoog, formerly at Northwest Youth Services, now housing program specialist at county Health Department
- Derek Long, Sustainable Connections
- Bob Bromley, Sumas mayor
- Nancy Larsen, Whatcom-Skagit Housing
- Charlotte Eastman-Pros, Wells Fargo
- Hart Hodges, assistant professor of economics at Western Washington University
- Jon Soine, Windermere Real Estate.
Who should get affordable housing?
Report: Lower development costs crucial to cheaper new homes

Developers strongly oppose such rules, which they say would force them to offset the cost by charging more for other units. That may not be possible, they say.

They were so worried that in December 2006, a Bellevue-based attorney working for the Building Industry Association of Whatcom County filed a public disclosure request with Bellingham asking for records related to inclusionary zoning, calling it "forced low-income housing." At that point, the task force had barely formed.

Whatcom County residents have been warned that voluntary laws have failed elsewhere.

Kat Gjovik, former housing director of the now-disbanded Bainbridge Island Community Housing Coalition, told Whatcom County residents in April that the rules must be mandatory, although the government must also provide carrots to make projects financially viable. Bainbridge Island had a voluntary law but scrapped it. Now, the community is drafting a mandatory rule requiring 15 percent of units be sold for less.

"Most communities have found the voluntary programs not to work well," said Paul Schissler, executive director of Bellingham-based Kulshan Community Land Trust and a task force member. His nonprofit helps people afford to buy their own homes.

A local study group that visited Boulder, Colo., and Burlington, Vt., found developers thriving there despite a mandatory inclusionary zoning ordinance, he said.

Others oppose a mandatory law.

"No one should support mandatory inclusionary zoning until they have built five or 10 homes in this town," said Ted Mischaikov, a task force member and Bellingham-based developer. He would agree to mandatory laws if the city would guarantee to buy the cheaper units if they didn't sell, eliminating a big risk, he said.

Mandatory inclusionary zoning is politically expedient, but it drives developers outside city limits if the project won't work economically, said Hart Hodges, assistant professor of economics at Western Washington University and a task force member.

"Mandatory inclusionary zoning means the prices of other units are going to go up, and fewer of them will be built," he said. "I hope we'll be more clever than that."

The report is only advisory, and the Bellingham City Council and Whatcom County Council get the final decision. At the same time, elected leaders will take the report seriously, said Bellingham City Council member Terry Bornemann, a co-chairman of the task force. It was unanimously approved by a task force representing developers, bankers, nonprofits, local leaders and others.

He wants task force members to present the report to the council this fall.