The “Block 59” South Lake Union land deal says a whole lot about how we do things here in Seattle.
Imagine: Eleven years ago, Seattle sells a property to Vulcan for $3 million. The city invests in streets, transit and parks in the area to promote development, and the property rises in value. Now, in addition to a rezone to allow the construction of three high-rise towers, the city gives Vulcan up to $12 million in credits for the same property.
Vulcan then gives the city $3.5 million to buy out some current property owners on the parcel, so at the end of the day the developer giant triples its original investment and is allowed to build sun-blocking South Lake Union high rises. Property values and housing costs go up accordingly.
On the other side of the deal, a consortium of nonprofits gets to locate as many as 400 affordable apartments and services in a high land-value area on the Block 59 parcel that it would otherwise be unable to afford — assuming there’s money from somewhere else to develop the property.
The credit would come in lieu of Vulcan paying into a bonus fund earmarked for affordable housing. Nonprofit housing developers like the deal because it delivers community benefit earlier than payments into the bonus fund would, and it sets aside downtown property that would otherwise be unaffordable. A Vulcan spokesperson likened the transaction to the city giving Vulcan a “Starbucks card,” to which they can charge bonus fund payments until it is finally empty.
A $12 million Starbucks card. That’s a lot of caramel macchiatos.
It’s been called the Seattle way. We invest public resources in private corporations, and the resultant economic growth gives us the tax base to support a relatively generous human services industry. Private enterprise gets rich. The nonprofits get their cut. Everybody wins.
Unless the economy tanks. Then the money for human services dries up just when it’s needed most.
There’s money to build the world’s widest deep-bore waterfront tunnel. There’s money for a third stadium in SODO. And now there’s money to build Paul Allen’s field of dreams in South Lake Union. But last week, we learned that the $200,000 that was recently approved for new homeless day centers and hygiene services would be offset with cuts to the nine agencies already providing these services.
Abracadabra. Now you see it. Now you don’t.
This last pathetic bit of sleight of hand, coupled with our city’s largess to hedge fund managers and software tycoons, speaks volumes about Seattle’s real priorities.
Speaking of Starbucks, astute readers of The Seattle Times might have noticed the dueling headlines in the Jan. 26 edition after the One Night Count. Alongside the banner headline about 2,736 homeless people counted outside in King County and the need for more emergency shelter was news of Howard Schultz’s 80 percent pay raise. The Starbucks CEO received $28.9 million in total compensation last year.
I doubt any of that came in the form of Starbucks gift cards. There’s plenty of money in this town. It trickles down when they piss on us, and we gratefully call it rain.