Council held the public hearing yesterday and passed the TOD abatement program update to second reading next week. Commissioner Saltzman actually moved my suggestion for unbundled parking (adding it to the public benefit list) as an amendment, and it will be part of the package voted on next week.
Here are the other highlights of the update:
- Beyond meeting the affordability requirements, developers will need to provide three of the public benefits listed, not just one.
- There is an annual limit of $20M on the amount of property that can have this abatement (to limit the hit on the general fund).
- Council expanded the areas eligible for the program, adding areas in Hillsdale and a site between South Waterfront and RiverPlace (beyond the new areas included in the recommendation from Planning Commission).
The last two points would seem to be in conflict. There will be a lot of folks working to get their projects included in that $20M in value. Commissioner Sten remarked that there are individual projects that could consume the whole thing.
The credit is on the council agenda for Wednesday at 10:30am. The comments on this post wandered all over the place, so I won’t submit them, but I do hope to be there to testify.
Original Post: 10/5/06
I’m late to the game.
On October 18th (tentatively 9:30am) City Council will be considering changes to the Transit-Oriented Development (TOD) Tax Credit. The Planning Commission has recommended a set of changes (PDF, 78K) as part of their review of the credit program.
I missed this as it went through Planning Commission. But I have an idea I’d still like to put into the mix.
The TOD credit program includes a menu of “public benefits”. A developer has to provide sufficient benefits to justify the tax credit. I’d like to add a public benefit to the list: Unbundling Parking.
This is an idea that was first brought to my attention by a fellow neighborhood activist, and which is now being tried in Vancouver, B.C.
Here’s the logic: you’re buying a condo, moving into a dense urban environment. You may or may not need a car. But the lenders for the developer have pretty much decreed that every unit has to having a parking space, or they might not sell (the last outcome the lender wants). So you plunk down $300K for your condo, AND your parking space.
Now imagine if instead, your condo was $270K, and you had the option of buying that parking space for another $30K. Wouldn’t you think twice about whether you wanted to buy a car (if you didn’t have one)? Even if you had a car, wouldn’t $30K make you wonder whether you wanted to keep it?
But today, you don’t think about it. You don’t have a choice to make, you get the parking space whether you want it or not! It’s just one more way that the actual cost of owning a car is hidden.
So in the name of choice, and more affordable housing, let’s unbundle the purchase of parking spaces from condos.
What’s the downside? Developers could get left with unsold parking spaces. The market should adjust over time, but until that time, developers could be allowed to rent out unsold spaces for ‘shared parking’ uses, e.g., monthly rental to nearby employees or valet parking.
Indeed, there’s evidence the market is already figuring this out. A number of units at the new Civic condos on Burnside were built and sold without parking spaces. And Gerding/Edlen has indicated that their new condo development near PSU will have unbundled parking.
So adding a little incentive via the TOD tax credit should just accelerate a good thing for developers who haven’t seen the light yet.
Tell me what you think about this, and I’ll bundle up this post and the comments and send them off to Council before the 18th.