— from Steven Jung —
By now, I expect most Orcas Issues readers are keenly aware of San Juan County’s extreme lack of affordable housing, especially housing for lower income families who provide the basic services on which we all depend. And that this lack has a huge impact on the ability of these families to live and thrive here.
Most readers probably even know that in November, county voters will be presented with the opportunity to establish a Real Estate Excise Tax (REET) of one half of one percent that will be applied largely to new buyers of real estate in the San Juans–with the proceeds dedicated to providing affordable homes for purchase and rental. (For more information, visit www.yesforhomes.net.)
What readers may not know is that this tax has great potential to actually improve our Quality of Life, as opposed to other dedicated taxes which seem to be spent largely to maintain the County’s bureaucracy (e.g., the .1% Mental Health sales tax) or get frittered away (e.g., the hotel and lodging sales tax).
Reason for optimism is provided by several factors:
- Funds will be managed by the San Juan County (SJC) Community Services Department, with assistance by the Housing Advisory Board, both of which have a history of sound administration and low overhead.
- Funds may be usable to match other sources of federal and state housing assistance, which means they can be leveraged to provide an estimated four dollars of housing acquisition, construction, rehabilitation, maintenance, and operation for each county dollar expended.
- San Juan, Orcas, and Lopez islands are all blessed by the long-time presence of successful community housing trusts, such as Orcas Island’s OPAL, which will be involved in directing and implementing REET funded projects and in ensuring accountability for the funds spent.
Now is the time to take a tangible step forward in addressing our islands’ most pressing need. I hope we will not squander this opportunity.
Please join me in voting YES FOR HOMES this November.
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I’m wondering why this didn’t pass the last time it was on the ballot? …and why is this time different? Just sayin’
I fail to see the logic in how making the purchase of a home more expensive (by imposing a buyer’s tax) makes the home more affordable.
According to the folks promoting this property tax, the buyer of a $350,000 property would pay an additional $1,750 in closing costs if the measure passes. A major hurdle for many potential home buyers is coming up with enough cash to cover the down payment and closing costs; this would only add to their burden.
And if the tax is rolled into the mortgage, it would increase the monthly payment, perhaps disqualifying the buyer from obtaining the mortgage in the first place.
Might not a better answer to the very real problem of high-cost housing be addressing the issue of short-term, vacation rentals that keeps houses off the market that might otherwise be sold or rented out on a long-term basis? Diminished supply drives up sales and long-term rental prices.
As another commenter wrote, just sayin’
Peter, I think your point is very valid on some level. I think the vacation rental market has done an awful lot of damage here. What you are not understanding is that there are very few people buying $350,000 properties anymore, but there are many, many who are buying $1M+ properties as 2nd and 3rd and even 4th homes. These folks can way easily afford the reet and those funds can then be used to provide affordable housing for those who cannot even make it to the $350,000 level… My husand, along with many others worked very hard to get this item on the ballot once and it was voted down. Pretty much the same voters are living here now that voted it down last time. I’m not sure why they would vote no that time and yes this time, but we are all hoping….
Peter makes good sense.
Taking a look at Windermere/Orcas Island, it appears that the majority of listings are under $1m.
Vacation rentals do appear to exacerbate the shortage of long-term rentals.
But here’s another perspective:
Where does everyone in the category of needing affordable housing live now?
Presently, the island seems to be bordering on luxury and fine quality in what it now offers its residents.
Do we really “need” more of anything?
Do we want to encourage an upward spiral of the population given the harm to be inflicted on the island’s small footprint and ecosystem?
Can we not raise taxes meant to subsidize and incentivize an increase in the island’s population?
We talk about the inevitability of the population growth, but there’s nothing inevitable about this on Orcas Island—which offers little or no jobs, upward mobility or mainland opportunities regarding earning capacity.
Instead, we would be raising taxes to actually harm our ecology and bio-diversity —for political reasons.
Perhaps that’s why it failed to pass before?
Just sayin’
To Peter Bohr’s very pertinent point about the regressive nature of real estate excise taxes, I understand that there are several ways in which qualifying buyers can receive assistance with the closing costs for both commercial and federal mortgage loans.
The major contribution of a county low income housing assistance program will be on the supply side…adding availability of both sale and rental units in a market where currently there is almost none.
Mary, I appreciate and share your concern for the high price of housing in the islands. And you’re right, developed $350,000 properties are scarce — on Orcas, anyway. I used that example because it is used in the website of the promoters of the tax measure. If the proposed tax pertained only to properties valued over a certain threshold, say $1 million, then I would agree with your reasoning. But unfortunately, it would also fall on those of more modest means who struggle to come up with down payments and closing costs on less expensive properties.
Better still, and to Chris’ point, why not look to make existing houses more affordable, either for purchase or long-term rental, rather then construct even more structures in the islands? Hundreds of houses in the islands in recent years have been converted to short-term, vacations rentals by investors, driving up property prices and long-term rents. Limiting short-term rentals, either by decree or taxation as some cities have done, would not only benefit island residents seeking more affordable housing, but would help to preserve the ecology and lifestyle that brought most of us here in the first place.
Good questions (Chris), and good comments all. And meanwhile, (see below), in these dated articles from the Sounder we can see how powerful the machine is, and that it’s operating in full gear (like an out of control train heading down the tracks). Someone asked about a “tipping point?” IMO, any system of governance that puts all their eggs in one basket and works overtime in order to support such a known high economical risk, and high-maintenance ($$$) business such as tourism to the point to where it becomes a to big to fail institution… is putting us well on our way towards that tipping point.
From the 8/01/17 Sounder SJC Public Notices (p-15)–
“Destination Marketing Organization Request for Proposal– SJC is seeking proposals from entities interested in managing a locally-based, full time destination marketing organization (DMO). The contract award will be funded entirely from the proceeds of the portion of SJC’s Lodging Tax that is dedicated to the promotion of tourism.”
“For the purpose of this proposal, funding remains at approximately $350,000 per year, plus 35% of any promotional funds available in excess of $425,000.”
(I thought it noteworthy that in this particular Public Notice section in this particular paper were also included the usual number of weekly vacation rental applications that were, and still are, being posted in the day (including, of interest, one that was submitted by one of our county officials).
And, in the following week’s paper,
From the 8/09/17 Sounder SJC Public Notices p-15,
Request for Proposals for SJC 2018 Lodging Tax Facilities/Promotional Grant Program
“SJC has established a tourism facilities program, funded by a portion of the revenue collected under the State Lodging Tax excise statutes and is seeking proposals from qualified entities interested in 1) funding single project proposals concerned with acquiring, improving or developing facilities that enhance the tourism experience; and/or 2) matching grants for for operating tourism facilities that enhance tourism experience; and/or 3) matching grants for events that draw tourists and/or 4) projects that carry out the goals of the SJC LTAC Tourism Master Plan. The contract year will begin on Jan. 1, 2018. The expected outcome of the funded activities is to increase economic activity in SJC in 2018 and beyond through the overnight lodging of tourists, through tourism related expenditures, and construction of tourist related facilities.”
The posting goes on to describe the matching grant criteria with one area being “Matching grants for Tourism events and Festivals designed to attract tourists,” and that, “The total available funding for 2018 Facilities grants will be approx. $925,767. Additional funds are available for Promotional grants, which serve to fund a Destination Marketing Organization as well as promotional events that draw tourists.”
Peter Bohr wrote: “…Limiting short-term rentals, either by decree or taxation as some cities have done, would…benefit island residents seeking more affordable housing…”
I have been repeatedly told by local politicos that this, and many other similar housing-control schemes, would be an unconstitutional “taking” of property from the owner thereof.
That is, if you buy a property of a certain kind and for a certain use, government would be improperly “taking away from you” some amount of your property’s use or value, if, long after you’d purchased it, government were to pass a law changing what you may or may not do with that property.
It is my own contention that such a law could be so written as to evade that constitutional issue, or at least to skirt it, but, so far, local government seems unwilling to make this effort.
Good points, Steve. They bear further study.
What often is permitted are incentives built around the edges—taxes, regulating use, and for rental properties within Associations, perhaps regulating CC&Rs may provide some avenues of de-incentivization.
But building more and more structures on a footprint that does not increase in size or sustainability doesn’t work; and ignoring this primordial fact threatens all life, not just ours.
Irreparable harm has already been done to this island. We need to devise and support policies that work to preserve and not exacerbate further harm to the island’s living and breathing support system.
We live in web-like interconnected habitat that by “great” lengths preceeded our arrival.
Unlike many situations in life where we ponder over the “chicken & egg” conundrum, here it’s clear.
The island’s natural habitat precedeed us by a long shot and it is we who draw life from it, not it from us.
It is therefore critically important to protect —especially as against “political” goals regarding “fairness.”
We can survive Orcas Island not resolving the larger society’s imbalances and need for redistribution (also because it cannot); none of us though, regardless of political persuasion, can survive the loss or further destruction of the island’s natural habitat.
It’s important to arrest this trend now before it becomes too ingrained and impossible to stop.
That, I would suggest, is the the most fundamental meaning of compassion.
I appreciate all the thoughts but wasn’t the time for making changes LONG AGO… Sadly the money wins…
Merry—Maybe yes, maybe no. Certainly, yes, if we all pile in on trashing the environment to see who can overbuild and overpopulate the fastest. We’ve made strides. In ten years time only a small minority who tolerate environmental degradation will be electable. Today’s youth will have ascended and the “vast” majority of them in the largest population centers of this nation will utterly shock you in your boots in how they prioritize life, diet and ecology. I’m up close and see it in person everyday when not on Orcas. They will have the numbers, the demographics and the power. We just need to hold the line til’ then. Stay tuned but more importantly stay proactive and positive. We can protect and preserve while enjoying, now and tomorrow, each and every amazing sunset— all at the same time.
-Our local economy relies on tourism, construction and the service industries.
-The workers in these industries must have housing.
-Most of the housing on Orcas will never be affordable for these lower income
workers.
-Vote Yes for Homes!
Tonight—where are they all sleeping and living?
In their trucks on the side of the road? With their children too?
I think not.
(BTW, every local contractor I’ve hired is handsomely paid, very busy and are living happily with their families in their own built or purchased homes on Orcas Island)
This bill DOES NOT address “current need” but rather a projected increase in the population that it, itself, incentivizes and causes as it would become its own self-fiulfilling prophecy.
This bill represents a Trend that is NOT your Friend if you care about a healthy, clean and nourishsing environment for you and your children.
Continuing to build and build and tax middle class, two-parent working families on the purchase of “EXISTING” homes (which are the vast majority of real estate closings) valued between 400k-700k so that more homes currently not needed could be built on the backs of other buyers of “existing” homes (and which only worsens the trend that’s destroying the island’s fragile ecosystem) represents a serious blunder on what will later be shown to be of epic proportions.
Where’s the forward vision that looks to preserve our habitat?
Vote to keep Orcas ecologically sound and naturally prosperous by voting NO on this initiative!
Vote NO on further denigrating the natural habitat of Orcas Island.
Vote NO on the politics of greed and narrow, short- term vision over preserving our local environment for tomorrow and beyond.
Vote YES for EXISTING homes by voting NO on this initiative.
Vote NO because you have vision and you care for more than this fleeting moment!
I fear that people are too afraid to go against the grain. Too afraid to create the personal discomfort that goes with being agaist the popular politics of the day—especially if they’re up in years and have little to gain but a lot to lose in their final more dependent years remaining. After all, nothing will radically change fast enough in their remaining years to personally cause them to suffer so why not take the easy, safe and popular route, relish in group-think and bask in the feeling that you’re hip and part of the open-minded “pc” crowd, pat each other on the backs as you throw the die even while knowing deep inside you throw a knife at the innards of our fragile, breathing habitat that begs YOU for relief.
After all, you can’t stop this. It’s being done to you. It’s not your fault.
But it is.
Do you think the island’s natural habitat cares whether you’re Donald Trump who places money and deal-making above the environment on which he, WE and his grandchildren absolutely depend for life as you who PLAY his victim, as you who pile in on his insane and irrational gambit with your own preferred poison by refusing to call out yourselves and your neighbor for contributing directly, intentionally, consciously and deliberately to overpopulating and overbuilding on a footprint that cannot expand to sustain and accommodate your passive, cowardly and complacent lives? —
do you think this island’s habitat cares which destructive camp or color-coded political banner you wave as it dies by your intentional behavior?
I trust you won’t find comfort in the illusion that you occupy any moral high ground as you play politics and further delude yourselves that you’re any better or different than those who you openly despise.
You CAN do so much better but you so clearly, definitely and decidedly CHOOSE not to.
That’s right, you have a dream; you see the light…though, in our ecological REALITY it’s an on-coming train and an environmental nightmare.
Happy Labor Day!
I’ve said my piece. I’ll move on.
Curious, in your opinion, how does the 1% mental health tax “maintain the County’s bureaucracy?”
Not to get too off point and exercise my own editing and self-policing powers, mental health doesn’t destroy the natural habitat.
Mental health, much of it manifested in the homeless community today, has grown as the social architecture we invented and built hits various stress/breaking points.
To survive in today’s modern society is, for many, to live so inconsistently as between what you feel and need inwardly and what you must become outwardly in order to make ends meet that it’s no wonder so many suffer from multiple conditions— from having been worn down to the breaking point.
I see it a lot and close up on NYC subways—often it’s only one thin sheath between managing one day and succumbing the next— as one never knows which straw will be the one that breaks the dam.
Hence, mindfulness and being more conscious so that “you” choose, not others for you, is your best medicine for environmentally-caused mental illness.
What do you all think of the Homes for Islanders using a loop hole to gain federal grant money intended for rural unincorporated areas to develop Single Family Homes within a city/town who elected to plan as Urban under the Growth Management Act. The only reason the qualify is due to our population being under 8000 but as we all know this is seasonal. USDA office said there was no interest in multi family funds when those were available. We could be caring for 2-3 families on the same amount of land rather than in some cases 1 member households. You can be 18 and own your home in the San Juan Islands is not a housing solution for all. It troublesome those leading have not been able to see the big picture and so now we all pay. To take equity from some who have little to give so that someone else can live in low income housing is not a good solution. Funding needs to come from another source and/or learn how to properly plan.