Tuesday, March 19, 2024

Council considers Housing Affordability Task Force recommendations

Posted

Part one of two

The Leavenworth City Council is considering the recommendations of the Housing Affordability Task Force. Mayor Cheri Kelley Farivar formed the ad hoc Housing Affordability Committee in April of 2016. The committee was tasked with evaluating programs and initiatives to produce affordable units and preserve existing ones. 

Then, make recommendations to the city council and planning commission to create incentives and codes to promote affordability within neighborhoods. There are 17 people on the task force including, Council members Elmer Larsen, Rich Brinkman and Mia Bretz, Port Commissioner J.C. Baldwin, Upper Valley MEND Board member Steve McKenna, Real Estate broker Dan Acton, Architect Peter DeVries, rental property owner Margaret Marson, attorney Ken Grosse, Marson and Marson, Tom Boyd, Sharon Waters (now a councilwoman), local home builder Matt Steinauer, UV MEND Executive Director Kaylin Bettinger, City Administrator Joel Walinski, Development Services Manager Nathan Pate. 

“They looked at demographics, types of housing, data collection, modification of regulations, incentive programs, expand housing types and affordability,” Pate said, at the Aug. 8 study session. “They looked at retaining the housing stock they could or investment funding. This group went through and we tasked with taking those pieces and coming back with a recommendation. They spent eight months.”

In December of 2016, BERK Consulting was asked to do a housing needs assessment. 

“They found 36 percent of the housing stock was seasonal, recreational or occasional use. That was a good number, even though our community understood it was a high number. It was interesting to understand that basically a third of the housing was second homes,” Pate said. “They found the vacancy rate was only 1 percent. That means there was lots of demands for rentals and not much available.”

A healthy vacancy rate is 5 percent. 

“In Wenatchee, their long term vacancy rate is 3 percent. They have a rental owners association which reports this data, so it is pretty accurate. I had always assumed that Leavenworth was in that same vicinity, but we’re at 1 percent, which means there are no vacancies,” Farivar said. “A 1-percent vacancy rate means it turns over before the first renters move out, the second renters are ready to occupy.”

Since 2013, median monthly rents have increased 13 percent annually. This is significantly faster than even the hot housing market in Seattle. The low vacancy rate appears to be putting pressure on the long term housing rental supply and upward pressure on rents. 

“Another way to look at that is 1 percent per month, if you are paying $900 per month rent, next year you can expect to be paying $1,000,” Farivar said. 

Almost a third of the households are cost burdened, meaning they are spending more than 30 percent of their income on housing. A fourth of the rent households are severely cost burdened or spending more than 50 percent of their income on housing. 

“Workers are commuting longer distances. With housing in short supply, they found workers were commuting in. We all knew that, but this is good data to prove that,” Pate said. “Wages are lower than needed amount to afford local housing. We’re in the services industry, which has lower wages.”

Forty percent of the residents are 60 and older. Student homelessness has increased. Home production has not matched the needs. 

“We do about five new residential houses in the city a year. We’ve seen construction in the county go up, but it does not match the needs. We had a recession, where the housing products dropped. It should be producing the amount of houses to meet demand,” Pate said. “Providing services to housing is a challenge. Services typically mean sewer and water. Some places can’t get sewer and water. It really limits the area that can be built.”

The BERK study had some key recommendations. Leavenworth has a significant workforce housing shortage. 

“That is a known factor, but it is good to hear from a consultant who has done all the analysis and can provide some professional recommendations for that simple fact,” Pate said. 

City control of its own regulations is the best opportunity to provide some solutions. 

“We do want to look outside for regional solutions, but as a city, some of the opportunities are within the city limits, where we have power,” Pate said. “They spoke to infill and redevelopment. There is an opportunity out there with different lot sizes and areas of vacant lots that might have an opportunity.”

The task force had considerable meetings and discussions on the market factors. Pate said this is separate from the BERK study, although they did recognize some of the components. The value of land is something the city cannot control. 

“We might be able to poke at it, but as you can see the value of land has gone up. We have to recognize it and do what we can when we can do it. The task force did absolutely state is there is outside forces, folks from the other side of the mountains, that look to buy a second home,” Pate said. “When we produce new homes, a portion of those will be purchased by non-locals. It is a fact, but what can we do? We still want to encourage homes, so we want move forward with good decision making even though we have outside factors affecting housing.”

From that, the group created four different sub committees, Zoning & Code Changes, Design, Financing/Funding Sources and Regional Solutions. 

Zone & Code Changes

Pate said he has a meeting set with the Planning Commission to review the tasks and set them for the docket so the city can actually change code. Some of the financing options would be a council decision, he said. 

Review the standards and criteria for the planned unit development or PUD. 

“It is a very good tool, but very clunky, so the task force said, fix it. There are five recommendations to make that piece more effective,” Pate said. “Reduce or remove 5-acre minimums. Consider no size limits. Density bonus- If you have critical areas, you can get more density. Instead of four units, you could get eight.”

To protect a critical area, Farivar said you can get a density bonus in the build-able area.  

“A developer comes in and wants to produce 14 affordable units and 100 market rate housing. Can I get a density bonus so I have more units to sell and lock in affordable? One of the good pieces of our group, they said, define that,” Pate said. “Not just for critical areas, but a social obligation. That’s part of the public good.”

Affordable housing: What does that specifically mean for Leavenworth? 

“When you talk about affordable housing in the context of the government set affordable housing limits, it’s based on area median income, the average income for Chelan County. We have a real high cost of living compared to a lot of Chelan County,” Bettinger said. “The area median income is lower here that it would be on the west side, where there are more high paying jobs. What we see here, that affordable limit. The people that are making a little bit more, but still can’t afford to rent or purchase a home here are getting missed by that affordable threshold in Leavenworth.”

In Leavenworth, Bettinger said you establish the cost of living. 

“This group of people are not going to be able to afford a market rate home or market rate rent, this is the group of people we want to target with affordable housing. We can decide that within the city limits,” Bettinger said. 

Leavenworth can create its own definition of affordable housing, Farivar said. 

“The was a revelation to me and many of those on the task force. We can say, yes we want to target the lowest income people, but we also want to touch on people who are nurses and teachers, first time home buyers, people who need more affordable housing,” Farivar said. 

A lot of other tourist communities with similar problems have done that, Bettinger said. 

“Rural, tourism based economies have similar problems, where generally the surrounding county is lower income than the tourism town where second homes are driving up the price,” Bettinger said. “As you get government subsidy for building units, you have play by their rules. We can set our own limits, but we have to come up with our own solutions.”

Review of Multifamily and Residential Zoning

Review lot standards and promote development of existing, vacant multifamily zoned lands. 

“We have specific standards for lot design that may need to be reduced for added flexibility,” Pate said. “We have multifamily zoned lands. One thing the council has done is provide sewer and water in the rattlesnake hill area. There might be a way to promote that existing vacant land. As a city, we might find solutions to bolster those areas.”

Finding a willing multifamily zoned landowner is a critical factor, Farivar said. 

“Multifamily is a condominium, as well. For example, Mr. Tom Lin which has that large multifamily parcel that abutts River Bend Park on the back side,” Farivar said. “He had the option of coming to the city and building that out as condos. But he came to the city and asked, what do we want? We said, long term rental housing. We do not want condominiums out there. We would rather see long term rental housing, which meets rental needs as opposed to second home ownership.”

Farivar said Lin was receptive to the idea. 

“He went out and found a developer to do exactly that. Having that kind of input early on with a development is one of the ways the city can encourage that kind of development instead of condominiums,” Farivar said. 

Larsen said when they started looking at ways to bring down the cost of homes to purchase, they realized what they were doing was making low cost second homes. 

“We kind of shifted focus to look at rentals, which would make housing available to people and would not be used as a second home,” Larsen said. “The focus has really been turned toward rentals.”

There was a lot of talk about 30-foot lots, Pate said. Farivar said the town is already full of 30-foot lots. 

“That was something done at the turn of the century to encourage urban development. We moved sometime during he ‘80s and ‘90s to make that 60-ft lots, so that you couldn’t build on those 30-ft lots. They would have to be combined,” Farivar said. “Now, maybe we need to rethink the size of the homes rather than the size of the lots. If we think a 30-ft lot is too narrow, then why do we think that? Because people were trying to put mega-houses on tiny lots. Maybe rather than make out lot sizes larger, we could keep them small and encourage smaller homes to be built.”

Other recommendations include yard setbacks and sub lots, which create more opportunities for infill, Pate said. At the current time, an ADU must be under one owner, but that could be expanded to two owners. 

“The group talked about triplexes and 4-plexes within all zoning districts not just multifamily. It’s a consideration to think about it. Is there additional permitting necessary? Providing differing housing stock in different areas,” Pate said. “Increasing the multifamily zoned area. We have multifamily zoning all over the city. Let’s look at the map and decide if you want to increase the multifamily into other areas. You are changing the neighborhoods. It is a great tool to add density.”

When the city went through a planning process on this, Larsen said the commercial has a band of multifamily around it to buffer the residential. This opens the door to having multifamily outside the neighborhood, Larsen said. 

“Without encroaching on the single family areas, there are way to encourage multifamily, such as stretching the district a few lots on the either side and in areas where there is already a lot of multifamily. Seems that makes them more willing to accept an expansion of multifamily. Lots of towns have done that,” Farivar said. 

Pate said the city could come up with new zoning district. 

“Something that is different with mixed use opportunities. Even though a planned development might satisfy that, but is there something you can do that is permitted outright. All the council has to do is create a new zone and establish it,” Pate said. 

Larsen said the city has done this before. 

“We had one occasion behind McDonalds, it was commercial on one side, multifamily on the other. Those folks came to us and said we have business people parking on both side of the street and we can’t take advantage of that. At the request of the homeowners, they moved the boundary to the alley, so both sides could be developed as commercial,” Larsen said. 

In part two, we’ll explore the Design Recommendations, Financing/Funding Source Recommendations, Regional Solutions Recommendations and next steps. 

Ian Dunn can be reached at 548-5286 or editor@leavenworthecho.com.

Comments

No comments on this item Please log in to comment by clicking here