23.75.085

A. Purpose. The provisions of this Section 23.75.085 are intended to implement an affordable housing incentive as authorized by RCW 36.70A.540. B. Findings. Pursuant to the authority of RCW 36.70A.540, the City finds that: 1. The phased redevelopment of the properties in the MPC-YT zone addresses the need for increased residential development to achieve local growth management and housing policies; and 2. The terms of the affordable housing incentive in this Section 23.75.085 recognize that, for affordable housing not receiving federal subsidies, the higher income levels specified for 60% AMI units and 80% AMI units, rather than the level stated for rental housing units in the definition of "low-income households" in RCW 36.70A.540, are needed to address local housing market conditions. C. The aggregate residential floor area limit for built and permitted development on all lots within the MPC-YT zone is established in Table A for 23.75.085 and subject to the following conditions: 1. The aggregate residential floor area limit is increased in stages, referred to as "tiers," when affordable housing is provided in accordance with the terms of this Section 23.75.085 in amounts sufficient to satisfy the conditions for the next tier according to Table A for 23.75.085. 2. The Tier 1 limit is the base, so no affordable housing needs to be provided in order for aggregate residential floor area to reach the Tier 1 limit. 3. If the total amount of constructed or permitted floor area reaches the applicable tier limit, but affordable housing production conditions have not been satisfied, no further building permits for residential floor area may be issued except for replacement units, 60% AMI units, or 80% AMI units. In counting total permitted residential floor area, projects with expired or cancelled permits shall not be included. 4. After the maximum residential floor area allowed has been increased to Tier 4, no Master Use Permit for a development including residential floor area shall be issued unless the development application includes a number of 80% AMI units equal to 4.5 percent of the total number of units in the application that are not either replacement units or 60% AMI units. Table A for 23.75.085 Maximum floor area limits for residential uses based on affordable housing production 1 Cumulative affordable housing production in the Yesler Terrace redevelopment area required to increase maximum floor area limit to the next tier, consistent with subsection 23.75.085.F Maximum residential floor area allowed in the MPC-YT zone Tier 1 (base) • 187 replacement units • 80 60% AMI units • A number of 80% AMI units equal to 4.5 percent of total units, not including replacement units and 60% AMI units, in the MPC-YT zone 1,400,000 square feet Tier 2 • 374 replacement units • 160 60% AMI units • A number of 80% AMI units equal to 4.5 percent of total units, not including replacement units and 60% AMI units, in the MPC-YT zone 2,750,000 square feet Tier 3 • 561 replacement units • 290 60% AMI units • A number of 80% AMI units equal to 4.5 percent of total units, not including replacement units and 60% AMI units, in the MPC-YT zone 3,350,000 square feet Tier 4 Not applicable 3,950,000 square feet Footnotes to Table A for 23.75.085 1 Housing units existing as of January 1, 2012 do not count toward the affordable housing production requirements or the maximum residential floor area allowed. D. To count toward the conditions to a higher tier under Table A for 23.75.085, affordable housing shall be committed under recorded covenants or instruments, acceptable to the Director of Housing, to satisfy the following requirements: 1. Term. The affordable housing shall serve only income eligible households for replacement units, 60% AMI units, or 80% AMI units, as defined in Section 23.75.020 , for a minimum of 50 years from the date when the affordable housing becomes available for occupancy as determined by the Director of Housing. 2. Affordability. Units must be committed to affordability as follows: a. Except as permitted in subsection 23.75.085.D.2.e, for replacement units, monthly rent, including basic utilities, shall be as allowed under the 1937 U.S. Housing Act, as amended, and agreements between the Seattle Housing Authority and the U.S. Department of Housing & Urban Development (HUD) and, for City-funded replacement units, agreements between the Seattle Housing Authority and The City of Seattle. Rent may increase in proportion to household income for qualifying tenants provided that rent shall not exceed 30 percent of 80 percent of median income. For purposes of this Section 23.75.085 , Yesler Terrace residents who are eligible to return pursuant to a relocation plan adopted by the Seattle Housing Authority shall be deemed to have met initial occupancy requirements. b. Except as permitted in subsection 23.75.085.D.2.e, for 60% AMI units, monthly rent, including basic utilities, shall not exceed 30 percent of 60 percent of median income. c. For 80% AMI units that are rental housing, monthly rent, including basic utilities, shall not exceed 30 percent of 80 percent of median income. d. For 80% AMI units that are offered for sale, the initial sale price shall not exceed an amount determined by the Director of Housing to be affordable to a household with an income, at the time of initial occupancy by the household, no higher than 80 percent of median income. The unit shall be subject to recorded covenants or instruments satisfactory to the Director of Housing providing for limits on sale and resale prices according to Section 23.75.020 and this Section 23.75.085 for at least 50 years. The Director of Housing is authorized to adopt by rule the method of determining affordability, including estimated monthly housing costs and requirements relating to down payment amount and homebuyer contributions. e. The Director of Housing is authorized to amend covenants to adjust affordability and income limits up to a maximum of 30 percent of 80 percent of median income if the Director of Housing determines that: 1) In the case of replacement units, a reduction in federal operating subsidies has made such funding insufficient to maintain the replacement units for households with incomes at or below 30 percent of median income; 2) In the case of 60% AMI units, after 40 years from initial occupancy of a building, rent levels are insufficient to operate and maintain the units or to meet any required debt coverage ratios as required by financing; 3) The number of units with adjusted affordability has been minimized to the extent practical, and 4) One or more agreements are entered into between the housing owner and the Director of Housing committing the housing owner(s) to new affordability and occupancy requirements effective when replacement units and/or 60% AMI units are vacated and available for occupancy by new tenants. 3. Size. If provided in a development permitted under a single master use permit that includes dwelling units other than affordable housing, the average net unit area, measured according to subsection 23.86.007.B, of the units provided to satisfy requirements of this Section 23.75.085 shall be no smaller than the average net unit area of the total units in the development. 4. Location. Affordable housing must be located within the Yesler Terrace redevelopment area. No more than 190 of the replacement units shall be located east of Boren Avenue. A minimum of 50 replacement units shall be located in at least five of the eight blocks west of Boren Avenue. When provided within a development permitted under a single master use permit that includes dwelling units other than affordable housing, the affordable housing shall generally be distributed throughout the development. 5. Reports. Periodically as may be required by the Director of Housing, but no less than annually, the owner of the affordable housing shall submit to the Office of Housing a written report demonstrating compliance with and housing outcomes of this Section 23.75.085 . The report shall include required information and supporting documentation, verified upon the owner's oath or affirmation and in a form prescribed by the Office of Housing. The Director of Housing is authorized to assess a late fee of $50 per day, which shall accrue until the report is submitted, starting 14 days from the date of the Office of Housing's notice that the report is overdue. For ownership affordable housing, the applicant or third-party stewardship entity, as applicable, must comply with reporting requirements of this subsection 23.75.085.D.5. 6. Compliance monitoring fees a. Rental affordable housing. The owner of rental affordable housing shall pay the Office of Housing an annual fee of $190 per affordable housing unit for the purpose of monitoring compliance according to this Section 23.75.085.The annual fee shall automatically adjust annually on March 1, starting in 2024, by an amount in proportion to the increase, if any, for January 1 through December 31 of the prior calendar year, in the Consumer Price Index, All Urban Consumers, Seattle-Tacoma-Bellevue, WA, All Items (1982-1984=100), as determined by the U.S. Department of Labor, Bureau of Labor Statistics, or successor index, unless the Director of Housing determines that a lower fee covers the cost of monitoring compliance. b. Ownership affordable housing. The owner of each ownership affordable housing unit shall pay to the Office of Housing or third-party stewardship entity, as applicable, an annual fee payable in 12 equal payments for the purpose of monitoring compliance with this Section 23.75.085 . The fee shall be established by the Director of Housing by rule. E. No other restrictions for 80% AMI units; exceptions 1. Except as permitted in subsection 23.75.085.E.2, 80% AMI units provided according to this Section 23.75.085 must be different than restricted units provided for any other reason. 2. For purposes of this subsection 23.75.085.E, 80% AMI units may be the same units as provided to satisfy conditions of the following subsidies: a. Discounted land sales prices; b. Washington State Housing Finance Commission bonds and 4-percent low-income housing tax credits; and c. The first 12 years of a property tax exemption pursuant to Chapter 5.73 . F. Production 1. A replacement unit, 60% AMI unit, or 80% AMI unit shall count for purposes of Table A for 23.75.085 when the affordable housing is subject to recorded covenants or instruments that conform to this Section 23.75.085 and are satisfactory to the Director of Housing in form, content, and priority. Any unit or units of housing provided as a condition to bonus floor area pursuant to any Land Use Code section other than 23.75.085 shall not count for purposes of Table A for 23.75.085. 2. Units other than replacement units, 60% AMI units, and 80% AMI units shall count for purposes of Table A for 23.75.085 when a Master Use Permit for construction of those units has been issued, unless and until either: a. The Master Use Permit decision is cancelled before the Master Use Permit is issued, or the Master Use Permit issued pursuant to such decision expires or is cancelled, without the highrise structure having been constructed; or b. A ruling by a hearing examiner or court of competent jurisdiction reversing or vacating such decision, or determining such decision or the Master Use Permit issued thereunder to be invalid, becomes final and no longer subject to judicial review. G. Tier determination. Upon application by any owner within the MPC-YT zone, the Director may make a Type I decision as to the residential floor area tier in effect. H. Rules. The Director and the Director of Housing are authorized jointly to adopt rules to interpret and implement the provisions of this Section 23.75.085 , in addition to rules that may be adopted by the Director of Housing independently as authorized in this Section 23.75.085 . I. Distribution of residential floor area limits by sector. Table B for 23.75.085 establishes residential maximum floor area limits by sector. The sum of the sector allocations exceeds the maximum established for the entire zone, but this subsection 23.75.085.I does not allow the total amount of residential floor area in all sectors combined to exceed the limit in effect under Table A for 23.75.085. Table B for 23.75.085 Distribution of residential floor area Sector Maximum residential floor area* NW sector 1,500,000 square feet NE sector 875,000 square feet SW sector 1,437,500 square feet SE sector 1,125,000 square feet *While the sum of the sector allocations in this table exceeds the maximum established for the entire zone, this subsection 23.75.085.G does not allow the total amount of residential floor area in all sectors combined to exceed the limit in effect under Table A for 23.75.085. J. Floor area subject to the limits in this Section 23.75.085 is all residential gross floor area except for accessory parking and floor area in residential structures existing as of January 1, 2012. K. Fees. The applicant for a project that includes 80% AMI units according to this Section 23.75.085 shall pay housing review fees according to Section 22.900G.015 . (Ord. 126855 , § 66, 2023; Ord. 125603 , § 67, 2018; Ord. 123963, § 26, 2012.)