June 2002: How Affordable Housing Incentive Programs Fund Preservation
By Heather MacIntosh; research assistance by Kim Carey

As the term "economic downturn" evolves from catchphrase to cliché, the idea of increased funding for historic preservation seems more and more unlikely in the near future. This means preservationists need to look for other areas of aid where missions might overlap. In Seattle, few topics spark political interest and debate as much as major transportation plans and affordable housing issues. Even economic development incentives take a back seat to these two primary public concerns. Both will appear on the September ballot.

The issue of affordable housing in Seattle is not new, nor is the idea of combining affordable housing with historic preservation. Historic Seattle, chartered as a Preservation and Development Authority in 1974, has since created 80 units of affordable housing in older buildings throughout the city. Visit Historic Seattle's Project Page to view some examples. The National Park Service's federal tax incentive program provides a double incentive for preservation projects that create affordable housing. Local architecture firm Stickney Murphy Romaine Architects is nationally renown for their adaptive reuse and rehabilitation projects that create affordable housing in historic buildings. An example of their work appears on the National Park Service's website as a premiere example of how affordable housing and historic preservation can come together effectively, economically, and artfully.

Advocates for affordable housing in Seattle are strong, outspoken, and articulate. Many feel strongly about preserving our city's existing affordable housing. Though these advocates' primary focus is maintaining and creating affordable housing, not preserving our city's architectural heritage, I have found that many of the best affordable housing advocates also promote preservation by default. Of the many passionate citizen lobbies I've encountered as a preservation advocate, I believe Seattle's affordable housing supporters are among its strongest.

A Little Background

The concept of publicly-subsidized affordable housing rose as low-income residents were steadily edged out of the urban core. This trend tracked with a nation-wide population shift toward the suburbs in the 1920s, and continues today. The negative impact of sprawl has been analyzed and highly criticized since the 1980s, which has led many cities, including Seattle, to encourage increased density in urban areas. These planning efforts only partly counteract the wide-scale demolition of thousands of units of historic affordable housing in downtowns between 1950 and the late 1980s. Although "urban renewal" in Seattle was much less dramatic than in other cities like Chicago or Newark, New Jersey, the trend substantially shaped our city's social geography.

Historically, downtown was affordable because many of the people who worked downtown and on the waterfront were wage laborers who generally walked to work. Central Downtown, Pioneer Square, the International District, Belltown-Denny Regrade, and Cascade were originally home to thousands of workers and hundreds of affordable tenant and boarding houses, cottages, and apartment buildings. By the mid twentieth century, industry in Seattle shifted from the central waterfront to the head of the Duwamish, further south. The rise of Boeing, and other local industries outside of downtown strengthened the suburban population base, and stimulated retail and service business growth in residential neighborhoods. A post-World War II penchant for cars, clean and efficient homes, garages, and affordable single-family houses contrasted the older, denser, historic housing solutions downtown, which were beginning to look a little shabby in contrast.

The Ozark Ordinance of 1970, put in place due to a deadly fire that killed 21 residents of the Ozark Hotel, emptied many downtown apartment buildings by requiring fire safety upgrades (sprinklers). This public safety measure occurred at a low point in Seattle's economic development, known as the "Boeing Bust" which led to massive layoffs and population attrition. Few apartment building owners chose to or could afford to upgrade, and closed their doors, leaving many buildings vacant for decades. This further reduced the number of affordable housing units available downtown and contributed to the steady deterioration of downtown housing stock.

While many of these buildings in the International District and Pioneer Square still stand, most in the downtown core were demolished. Pressure on historic affordable housing stock in Belltown and Cascade continues.

History of Public Subsidy and Public Policies for Affordable Housing in Seattle

In spite of the monumental loss of historic affordable housing in downtown neighborhoods, Seattle has been a leader in the area of low-income housing since the issue took on national significance in the 1930s and 40s. Yesler Terrace, built between 1941 and 1942, was the first low-income housing project in Seattle, and the first of its kind in the country. It was Seattle Housing Authority's first project using funding from the Federal Housing Authority, and was the first racially integrated housing project. Seattle's role in war industries at that time drew attention to the shortage of affordable housing in this city, and sparked the construction of subsidized affordable units, especially in areas close to employment centers. Holly Park, in South Seattle, was created in 1942, and is now a SHA property.

The Johnson administration created HUD, the Department of Housing and Urban Development, in 1965, at the same time issues of segregation, civil rights, and open housing were hot and contentious topics. Seattle defeated the Open Housing Referendum in 1964, by a 2 to 1 margin, which served to maintain the existing racial makeup and inconsistencies in housing between black and white residents. In 1968, Seattle enacted a law banning racial discrimination by landlords and real estate agents. Race and affordable housing were inextricably bound when Seattle began its first concerted efforts to serve and protect low-income residents. Racial minorities and the elderly were the first two groups targeted for aid by both the federal government, and the city's first staff dedicated to housing issues.

In 1969, the Nixon administration began the Community Development Block Grant program for city redevelopment. The funding has gone toward the redevelopment of existing housing stock, as well as new, and has helped Historic Seattle fund some of its affordable housing efforts. As federal funds for affordable housing grew, so did the public housing population. In two years, between 1968 and 1970, Seattle's subsidized resident base increased by over 40%.

The City of Seattle developed an Urban Renewal plan in 1974, and within it planned for increased affordable housing. The same year, HUD gave Pike Place Market, then an urban renewal project, funding for 210 low-income subsidized housing units, and pledged $500,000 toward the rehabilitation of 91 repossessed Seattle homes into affordable housing. The economic recession of the 1970s caused the city to look at the quality and quantity of low-income housing. Layoffs and a weak economy, combined with shockingly high interest rates translated into more residents, previously middle class, who qualified for and requested public subsidies. To some degree, the recession served to level the racial stereotypes about affordable housing aid recipients.

As the city began to gentrify in the late 1970s and property values began increasing steadily, a community of low-income housing advocates crystallized. In 1978, the Seattle Tenants Union persuaded the Seattle City Council to delay the conversion of apartment buildings into condominiums. In 1979, City Council approved both the Housing Assistance Plan that preserved existing low-income housing, and received a federal block grant that provided 6.4 million for housing programs. The Council also considered adopting an anti-demolition ordinance, but this did not materialize.

As the limits of government became clearer in the late 1970s, many nonprofit organizations formed to take up the slack. Public Development Authorities (PDAs) became a primary vehicle for development of affordable housing, and could qualify for low-interest loans and grants not available to conventional developers. Historic Seattle, a preservation and development authority, can develop properties that are not "economically feasible" for conventional developers, because of its status. The Reagan Administration's cuts to community development funds further catalyzed the privatization of affordable housing development in the 1980s.

Large-scale projects, such as the Washington State Convention Center and I-5, removed and did not replace over 12,000 low-income units between 1960 and the mid-1980s. The tide of advocacy for affordable housing came, in many minds, about 20 years too late to protect the loss of Seattle's historic affordable housing stock. Efforts to preserve affordable housing downtown were overturned by the State Supreme court in the late 1987. In response, then-mayor Charles Royer ordered an 18-month halt on demolition of downtown low-income housing. The moratorium on demolition of housing expired in 1990, and City Council refused to renew the ordinance.

Affordable Housing and Historic Preservation

Historic preservation efforts paralleled citizen advocacy around affordable housing in Seattle, and in many ways, complemented it. Seattle's first historic district (also the country's first), Pioneer Square, is linked to the history of its "Skid Road" residents, and still serves low-income and homeless citizens. Pike Place Market is another iconic Seattle landmark with links to the city's laboring roots, and provides low-income housing. The city's preservation ordinance was created in 1974 at the same time many affordable housing issues came to a head.

Historic Seattle's track record of creating and preserving affordable housing Seattle stems from the political context in which it was formed. Historic Seattle's mission to protect threatened resources coincides with the mission of other public development authorities such as Interim and the Seattle Chinatown International District PDA. The latter two were not conceived as preservation organizations, but their role as public development organizations overlaps with Historic Seattle's preservationist mission, and we often find ourselves doing the same sorts of preservation projects, with the same subsidies.

It is no surprise then that the Housing Levy, which was initially passed in 1995, has helped preserve Seattle's historic affordable housing stock. According to an Office of Housing report, 48.9% of affordable housing units generated by 1995 levy funds were spent acquiring or rehabilitating existing buildings. Many of these were historic, including the Villa Apartments where the mayor first announced his support for the increased levy funding.

In Seattle, the relationship between historic preservation and affordable housing is inextricably bound, and will only grow in the future.

Many thanks to Kim Carey for her research for this article.

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