Approved by 63 percent of voters during Seattle’s Nov. 3 election, the renewed levy will generate $147 million in local revenue for building 1,670 units of affordable housing and provide assistance to 9,300 other people through rent assistance and home buyer assistance. The levy taxes the 350,000 households in Seattle about 17 cents per $1,000 of assessed value. The owner of a $450,000 home, for example, contributes $79 per year.
Since its creation in 1981, the levy has generated almost $400 million in local funds, as well as millions in matching federal dollars, says Harry Hoffman, the executive director of the Housing Development Consortium, a trade association of housing developers in Seattle.
“It allows us to leverage county, state, federal dollars and private philanthropy,” Hoffman says, estimating that for every dollar the levy creates in local revenue, three dollars are earned through those sources. Ten thousand units of affordable housing for people who are formerly homeless, elderly, and have little income, have been built.
Without the levy, Hoffman says that the development of affordable housing in Seattle “would pretty much grind to a halt.”
“It makes projects possible,” Hoffman says.
Advocates in Portland say that a local levy could create the same level of activity. But there are no plans to put a similar levy on Oregon’s ballot in 2010. Nick Fish, the city commissioner in charge of the Housing Bureau, says that a levy is unlikely to appear on a ballot for another “three to five years.”
“My sense is that it normally takes up to two years to lay the groundwork, raise the money, get your message across and be successful,” Fish says. “I have limited experience on this. I am open to hearing from the folks who are a lot more smarter about this than I am.”
Many people involved in developing low-income affordable housing are not pleased with Fish’s timeline for a local affordable-housing levy.
“When the Affordable Housing Now! coalition … looked at the possibility of copying Seattle’s success with bonds and levies (in 2002) it was a top priority,” says Michael Anderson, the executive director of the Oregon Opportunity Network. “It remains a top priority.”
“I think it’s critically important that we have a levy, and we have one as soon as possible,” says Bobby Weinstock, a housing specialist at Northwest Pilot Project, which finds housing for low-income elderly people.
Describing the need to develop low-income affordable housing as “dire” and “urgent,” Weinstock cites the 2000 Census, which showed that there is a shortage of low-income affordable housing in Portland by 11,577 units.
“The housing levy gives us a way to eliminate the housing shortage for that income group,” he says. “(It would make) a huge dent in the homelessness issue.”
Fish says that Portland will have to find new sources of revenue that are dedicated to affordable housing.
Until this year, the Portland Housing Bureau’s budget has always been precarious, relying on one-time funding from the city’s General Fund that is re-evaluated during each budget cycle. This year, the Housing Bureau’s budget was completely preserved, even as other city bureaus faced budget cuts of 5 percent or more.
Portland also has the 30 percent TIF (tax increment finance) set aside — revenue that comes from taxes diverted from Portland’s nine urban renewal districts. However, there have been a host of problems using those funds (Street Roots, Dec. 12, 2008). Fish says that in three to five years, that source of funding will no longer be reliable.
In the last legislative cycle, the Oregon Legislature passed a document recording fee, which charges nominal fees for recording real estate documents. The revenue raised from the fee goes toward building and maintaining affordable rental housing.
The fee was a huge victory for affordable housing advocates because it was the first time the state dedicated a source of revenue for affordable housing. But as Fish points out, the source of that revenue — transactions in the real estate industry — is directly tied to the economy.
“In the current recession, it’s not going to generate the money we need to tackle the problem,” Fish says.
“We are going to take a good hard look at additional sources of funding for housing. That means thinking about whether we should pursue a future bond or levy,” Fish says.
However, during his interview with Street Roots, Fish did not give any concrete plans about what those sources might be, except to say that they must be dedicated sources of revenue, although he did express interest in pursuing a levy similar to Seattle’s.
But now is not the time, he says.
“There’s a bunch of other community priorities that have been identified,” Fish says, such as schools, and he adds that he is pursuing the idea of putting a levy that would generate revenue for Portland’s parks system on the 2010 ballot (Fish also serves as the commissioner in charge of the Parks Bureau).
“It seems to me that we can ask,” Weinstock says, laughing. “We ask for things that are important to people like the libraries and the zoo and school buildings. Voters have approved those assessments on themselves. If we can make a strong enough case (that) this is going to improve the lives of the lowest income levels, but it’s also going to improve livability for the whole city … I have faith in the voters here that they might feel this is important enough to approve.”
When asked if creating affordable housing is as an important priority as maintaining the quality of Portland’s schools and parks, Fish says, “Of course.”
“But at the same time, it’s like saying, ‘Which of my children do I love more?’” he says.
“If we’re competing against the children’s levy, that’s going to take some natural allies away from this levy,” Anderson says.
Fish also says it is not practical to pursue a levy during a recession, saying that Portlanders would not be willing to increase their property taxes.
“We heard a lot of that going into the levy campaign,” Hoffman says, saying that he thinks that Seattle residents did not view a $65 property tax increase as “that onerous.”
Polling done by Seattle’s levy supporters indicated that the economy may not be an important factor. A March 2009 survey paid for by the city of Seattle and done by EMC Research Inc., surveyed 800 Seattle voters via telephone. The majority, 73 percent of those called agreed with the statement, “In this economy, it’s more important now than ever to make sure we keep investing strongly in low-income housing programs and assistance.”
“Seattle has proven that when you make the case to the public about the difference affordable housing will make, the public will support investments in housing,” Anderson says.
“There are plenty of compassionate people in Portland, and if the case is made that we’ll see fewer people on the street and fewer people panhandling, then I think it could be successful,” says Susan Emmons, the executive director of Northwest Pilot Project.
Hoffman thinks Seattle’s levy is successful because of the progressiveness of Seattle’s citizens. He also says that the levy has become a sort of tradition for Seattle voters, something they are used to voting for. Indeed, the levy has gone to the ballot five times since 1981. It has never been voted down.
Hoffman says incorporating “the human element,” or the direct, personal impact of the levy, is a huge part of its success, and was an important part of an intense grassroots campaign. Before the Nov. 3 vote, Hoffman says, 40,000 calls were made to voter households. 4,000 homes were canvassed and 320,000 pieces of mail were sent.
“It wasn’t just writing checks, but it was people after a hard day’s work doing phone calls,” Hoffman says.
The groups and organizations fighting for the levy were not narrowed to organizations directly related to housing. Hoffman says that a coalition of housing organizations, unions, and other organizations put in time to the housing levy campaign.
Anderson notes that a crucial part of a successful levy campaign is strong political leadership. In Seattle, the levy was put on the ballot by the Seattle City Council.
Emmons points to Portland’s successes in public transportation and planned expansion of the MAX and streetcar lines as an example of the potency of strong political leadership.
“If we had a voice like that for housing …we could really see something,” Emmons says.
Recently lauded for his “tactful political guidance” by Mayor Sam Adams at the Nov. 20 groundbreaking for the Resource Access Center, Fish is viewed by many as up to the challenge.
“Nick has demonstrated that he’s out in the lead,” Anderson says.
So is another politician. County Commissioner Deborah Kafoury disagrees that it is necessary to wait to put a levy for affordable housing on the ballot.
“In this past year alone, we had a ballot measure for the zoo, PCC, the Portland children’s levy. I would argue that an affordable-housing levy is equally if not more important than any of those. I don’t know why we should have to take a back seat and wait,” Kafoury says.
Willing to take an “active role” to get an affordable-housing levy on the ballot, Kafoury says that supporters should also think big and create a levy that is county-wide in scope.
“I think we have seen a lot of shift of poverty moving into east county,” Kafoury says. “Having it within the city limits would be less helpful.”
Aside from timing, the recession and the energy it takes to get a grassroots campaign, another major challenge exists to get a levy on the ballot: Oregon’s property tax structure.
In 1990, voters approved Measure 5, which amended the state constitution and made it illegal to tax more than $10 per $1,000 of assessed real estate value per year. That caps the amount of revenue that can be generated through property taxes. And if there are a number of levies on a particular ballot, it also effects how much revenue those levies will generate, because the amount of money contributed from each home has to be reformulated.
“Anything that happens that would increase property taxes, it’s going to bump something else,” says Janet Byrd, the executive director of the nonprofit Neighborhood Partnership Fund.
Byrd, who did research for former Commissioner Erik Sten in 2002 when Portland last looked at the possibility of a housing levy, says Oregon’s property tax structure is perhaps the only major obstacle to getting a levy on the ballot, and it is why there has never been “a serious push” to do a levy in Portland.
When talking about the effects that Measure 5 has on affordable housing, Anderson says they have “boxed us in a hole where we can’t help ourselves.”
“It would be great if there were energy about removing those barriers,” she says.
That in and of itself would require a statewide ballot initiative. “It would take a lot of political energy and political will to get that done,” Byrd says.
Ideally, the state tax structure would be fixed first, Kafoury says. But, she adds, that has not stopped levy campaigns from happening in the past.
“I think we have a heck of a case to make about the need for new resources, the effective way we use existing resources, and what a future investment would mean in terms of the quality of life here in Portland,” Fish says.
And even though Portland has that case to make in the 2010 election, Fish insists on waiting for three to five years.
“I guess I would disagree,” Kafoury says. “Housing folks have been very patient in waiting for the perfect opportunity. And if you sit around and wait for the perfect opportunity, it never seems to come.”
Hoffman, who did not hold back in the number of Seattle vs. Portland jokes during two phone conversations with Street Roots, agrees.
“Saying three to five years,” he says, “is basically like saying never, right?”
By Amanda Waldroupe, Staff Writer
The past two editorials from Street Roots have layed out reasons why the region needs a levy sooner rather than later.
Nov. 12: Region must work for housing levy