In my blog entry of 3 July (click here to read that entry) I posited that one deleterious effect of increasing the number of unrelated persons in the definition of family for the purposes of zoning would be an immediate sanctioning by the city council of an increase of more than 9,000 possible renters within the single family neighborhoods, a back-door infill, as it were, with no input from those affected. There are some additional results if the number is increased from 3 to 4.
Our landlord representatives have on various occasions, in front of the council and in the newspapers, offered that theirs is an honorable profession and that most adhere to the laws. A regrettably small percentage of landlords are those who are causing the problems and bringing opprobrium on the group, they say. Taking the landlord representatives at their word, I would assume that most of the 9,000 or more rentals in Bellingham are either occupied by families related by blood or by groups of no more than three unrelated persons as the law states. If one raises the number of unrelated individuals to 4, then the overwhelming percentage of law-abiding landlords will have the legal green light to increase the number of unrelated renters in any home, regardless of its size. If the going rate for a single family home rental were the equivalent of $400 per renter under the so-called “rule of three”, a monthly rent of $1200 would be the result. Any landlord worth her mathematical salt, will immediately recognize that she, without changing the per capita cost for the current batch of renters, can add one more renter at $400 per month, thus increasing the overall rental rate for that particular home to $1,600 – a healthy 33% increase in rental income. The renters do not see their individual monthly rate increase and the landlord gets the windfall. And it is all legal. Oh, happy day!
Meanwhile, the family woman with her husband and two children, who are of modest resources and even more modest incomes, would like to rent that same house but now find that they are financially shut out of the process when the rent climbs 33%, from $1,200 to $1,600. The effect is even more profound on the single parent, single income family. The perverse outcome of raising the number of unrelated individuals is that in a market in which, low wage earners, 8,000 or more students from WWU and thousands more from WCC and BTC vie for housing, the groups of unrelated individuals become a more lucrative target for landlords. The higher you raise the number of unrelated individuals, the more market distortion you achieve and the more you invite uncontrolled infill.
Again, I ask my readers to contact the City Council members (click here to send a message) and the Mayor (click here to send him a message) to tell them that changing the number of authorized unrelated persons in a rental home is counterproductive and infringes on the ability of the neighborhoods to control infill.
1 comment:
In regards the proposal by Jack Weiss to adjust the "rule of 3" to be the "rule of 4" it seems to me that the question to Mr Weiss and for the City Council should be what are the origins and justification for this action?
By my research, the housing stock in Bham was approximately 33,500 units at the end of 2007, up from approximately 26000 10 years ago. The corresponding population numbers are 75,900 and 63,200 respectively. So the density in Bham is approximately 2.27 persons per housing unit last year compared to 2.43 persons per unit 10 years prior. Moreover, the Whatcom County Real Estate Report (WCRER) 2008 reports similar information, saying that from the year 2000, Bham housing stock has increased 18.9% while population has increased just 12%. Finally, on 3 July the Bham Herald reported that population growth in Whatcom County is slowing and only about a fifth of new county residents are choosing to live in Bellingham. In short, the high level numbers don't indicate a need for the City Council taking any action on the rule of 3 in order to "fix" housing availability.
Conversely, several negative effects of changing the rule can be noted.
First, this type of off-the-books infill is a tax avoidance and ultimately a shifting of the property tax burden. The units potentially effected by this rule are single family detached homes being rented, a bit over 25% of the housing stock, let's use your number 9500 units. Those landlords can reap a tax avoidance windfall because any shortfall in taxes to support infrastructure and services for the additional residents paying them rent, would have to be made up by all property owners. In practice, I would expect a fairly narrow demographic (18-25 years old renters) and a minority of neighborhoods (near to colleges) to make up the bulk of properties taking advantage of any change. In short, the benefits of this rule change would likely be shared by a narrow demographic who do not pay property tax and a minority of property owners because the tax burden that supports their renters is distributed to all property owners.
Second, increased occupancy of existing SFD provides infill that bypasses the mechanisms for improving the quality of housing stock. The building codes gradually evolve to provide higher standards for safety and energy efficiency. Development and redevelopment gradually roll these higher standards into the housing stock so that occupants are more comfortable and safer with less energy consumption. It would be interesting to hear from the building official and staff responsible for the quality and safety of housing in regards this matter. If the City Council adopts the rule change, aren't they undermining their staff and their responsibility?
Third, this type of infill hurts the local economy insofar as it defers or eliminates new housing units that would represent jobs and materials purchases supporting local businesses. Recently the market has served the local economy well with a construction boom, but with construction slowing, and unemployment rising, and population growth decreasing, changing the rule of 3 will simply delay economic recovery for the housing industry some little bit.
And then there are the quality-of-life arguments around noise, traffic, crime, etc.
My suspicion is that the proposed change to the rule of three is special interest lobbying, the natural course of politics, or possibly a mis-perception of actual need. It could be a legitimate reason that I don't know about. Whatever the origin of the proposal, my experience is the best way to influence any Council is to go to their meeting and ask them to address the data and the arguments against - to provide justification. If they have legitimate justification we all learn something. If it becomes a matter of public record that they have no justification refuting objective arguments against, they are unlikely to vote in favor. If they vote in favor without justification, you have ammunition for future battles.
I cannot go to City Council meetings to argue, or even send written arguments, as I do not live in Bham, but care greatly about this matter as I am planning a move back to Bham by the end of this year. I hope you or someone you know will take the time to address the Council directly.
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