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City Council Approves Final SLU Rezone Package, Highest Development Fees in the City

Earlier this month, the Seattle City Council adopted legislation to rezone South Lake Union, which will allow for increased residential and employment density in the neighborhood.  Adopting the rezone was identified as a top priority in DSA’s five-year Strategic Plan and we commend the Mayor and Council for their efforts to support continued growth and investment in SLU.  DSA’s Smart Growth Committee spent several months reviewing the legislation and making recommendations to improve upon the original proposal.

A number of those recommendations were incorporated into the adopted legislation, including incentives for development of a public school and provisions that support development of buildings for biotech and research organizations that will help grow Downtown’s global health and life sciences sector.

SLU rezoneUnfortunately, late in the process the City Council adopted amendments to increase the fees for development of residential and commercial projects in South Lake Union and appear intent on increasing the
fees for development in Downtown south of Denny Way as well in a separate legislation action.  Along with environmental organizations, SLU neighborhood leaders, small business owners, major employers, property owners and the
development community we have significant concerns that this decision will hinder future development in South Lake Union and adversely impact the creation of new housing units, commercial space, jobs and tax revenues.

The Council’s decision was not informed by a comprehensive study of commercial and residential real estate development in South Lake Union and lacked input from important stakeholders and experts with experience in commercial and residential development. The South Lake Union rezone was developed over the course of eight years, with extensive community engagement.  The Council’s proposal to increase development fees in South Lake Union was made over the course of a few weeks.

We fear that because the costs of developing to the maximum zoning was increased by the Council that many projects in South Lake Union will not take advantage of the additional density provided by the rezone and instead be developed to the base zoning.  This will mean less residential and commercial development capacity, and less tax revenue andpublic benefits that are otherwise generated when projects are built to the
maximum zoning.

“We are also concerned that the Council’s goal of increasing the amount of workforce housing in South Lake Union by increasing development fees will not be met,” said DSA vice president for Advocacy and Development Jon Scholes. “We know from the experience of other cities, and the experience in our own backyard, that a more comprehensive approach and set of strategies is necessary to increase workforce housing in Seattle.”

The Downtown Seattle Association is participating on an affordable housing task force convened by the Mayor earlier this year to develop a comprehensive city-wide strategy to address the need for additional workforce and affordable housing in Seattle.  By considering a range of options, including how surplus City lands can be used to reduce the costs of producing affordable housing, we can make progress on this important
issue.

Increasing the fees on dense residential and commercial development projects, as the Council has chosen to do, will limit the supply of housing that is ultimately produced and will fail to adequately address the need for more affordable and workforce housing.  We appreciate the Mayor’s decision to convene a broad set of stakeholders to thoughtfully
consider this complex policy issue and develop a comprehensive and informed
approach to meeting the challenge.

As a part of its Strategic Plan, DSA highlights Five Transformative Projects including South Lake Union’s residential and employment density, livability and connections to the rest of downtown. DSA will continue to work toward South Lake Union’s status as a high-quality place to live, work, shop and play.

Check out more of DSA’s outreach on the South Lake Union Rezone:

  • Kate Joncas and Chris Rivera, President of the Washington Biotechnology & Biomedical Association, underscore the detrimental effects of higher fees facing the health sciences industry in SLU in this op-ed.
  • DSA members and other community leaders express their unease at the proposed rates in this letter to City Council.

Read more on this issue:

The Stranger: The City Council’s SLU rezone actually provides less affordable housing than Mayor McGinn’s proposal

CityTank: Backwards: Seattle’s land use code

CityTank: The People and The Food: A policy fairy tale