When social housing could open in Seattle

Seattle's new social housing developer hopes to have its first property under contract by the end of the year, potentially allowing it to open its first mixed-income public housing building by mid-2026, CEO Roberto Jiménez tells Axios.

Why it matters: Voters approved a new tax last month to pay for social housing, a public housing model that caps rent prices at 30% of a tenant's income.

• It's different from typical affordable housing, largely because the units are open to people making up to 120% of the local median income.
• Last year, the median income in Seattle for the purpose of affordable housing programs topped $100,000 for a single person.

Between the lines: The concept behind social housing is that the higher rents paid by wealthier renters will help subsidize the lower rents paid by lower-income tenants.

• The model should allow the buildings to sustain themselves over time without ongoing government rental subsidies, said Jiménez, who was appointed CEO of the social housing development authority last year.

Flashback: Seattle voters created the social housing development authority by passing I-135 two years ago, but the 2023 ballot measure didn't include taxes to pay for the program.

The latest: To get things up and running, the social housing developer plans to use the tax money voters approved last month to help buy or construct its first buildings.

• Proposition 1A, which voters approved in the Feb. 11 special election, will raise an estimated $50 million per year for social housing.
• The new 5% payroll tax applies to Seattle companies with workers who make at least $1 million a year.
• Employers are to pay the 5% tax on the portion of an employee's salary that exceeds $1 million.

The fine print: It will take about a year to set up the systems necessary to collect the tax, Julie Johnson, spokesperson for the city finance office, told Axios.

• For that reason, the city doesn't plan to make the first tax payments due until Jan. 31, 2026, Johnson said.

What they're saying: Jiménez told Axios his agency will most likely try to access some of the Proposition 1A revenue before then.

• That probably will mean requesting advance funding from the city or some type of bridge loan, he said, in order to meet the goal of having an agreement in place to buy a property by the end of the year.

Zoom in: The agency is looking at multiple buildings that it could acquire and convert to social housing, Jiménez told Axios.

• If one of those deals goes through and the building doesn't need major work, Jiménez said he's hopeful it could open by the middle of next year.
• Buying land and constructing a new building would take longer, he said.

What we're watching: Tiffani McCoy with the Proposition 1A campaign told Axios she expects opponents may still file a lawsuit to try to overturn the tax.

• Jiménez said his agency remains focused on its strategic plan, which it expects to complete by early May, and hiring key staffers such as a chief financial officer.