In addition to upzoning parts of 27 neighborhoods, the plan would require developers to build or pay for a number of apartments affordable to households with low incomes.

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Seattle officials met behind closed doors with community-group leaders this summer to discuss a compromise over the city’s plan to allow denser buildings in the urban cores of more than two dozen neighborhoods.

The talks led nowhere, however, so both sides are now waiting for the outcome of a legal challenge brought by the groups of an environmental review of the plan.

“We’re on pause,” said City Councilmember Rob Johnson, a champion of the plan.

In addition to upzoning parts of 27 neighborhoods and several commercial corridors, the plan would require developers with projects in those areas to build or pay for a number of apartments affordable to households with low incomes.

Already established in the University District, downtown and South Lake Union, Uptown and the Chinatown International District, the Mandatory Housing Affordability (MHA) policy is supposed to harness the city’s construction boom to generate affordable housing.

The groups behind the legal challenge claim 27 neighborhoods are too many to tackle all at once, and some other organizations that support MHA in principle say the city’s plan may speed gentrification unless more is required from developers.

Because hearings in the legal case are taking longer than expected, the City Council has postponed action until January at the earliest, pushing the matter into a pivotal election year and closer to the eventual end of Seattle’s boom.

A ruling against the city in the case could set the plan back many more months, which means the debate is eating up most of Johnson’s term. He ran for office in 2015 — the same year the upzones were initially proposed — and his seat is up for election in 2019.

“The delay has reduced the amount of affordable housing we’re going to get because we’re nearing the end of the development cycle,” the council member said.

“A grand bargain”

MHA was the headline recommendation by a blue-ribbon panel convened by then-Mayor Ed Murray and it represented what Murray called a “grand bargain.”

Some big-time developers who had threatened to sue Seattle agreed to accept housing requirements in exchange for modest upzones, and the plan is supposed to generate more than 6,000 rent-restricted apartments in 10 years.

The council approved the policy for downtown and other already-dense neighborhoods with minimal opposition in 2016 and 2017, taking them one at a time.

Not until last November, when officials were ready to upzone another 27 urban villages and expand some of them, did a number of community groups and the Seattle Coalition for Affordability, Livability and Equity (SCALE) intervene by appealing the city’s environmental-impact statement to the Seattle Hearing Examiner.

They said the city skimped on the review by lumping the areas together rather than studying potential impacts in each unique neighborhood.

The parties spent the spring preparing for summer hearings that are scheduled to end in September, and Johnson expects hearing examiner Ryan Vancil to issue a ruling in November. By then, the council will be busy with budget deliberations.

Knowing the hearings would sap time and money, SCALE proposed talks with the city, arranging for a mediator.

That led to several sessions in June and July, according to Johnson, Toby Thaler of SCALE and Sara Maxana, a policy adviser to Mayor Jenny Durkan.

All three declined to talk about the substance of the negotiations, citing confidentiality agreements. But certain considerations shaped the talks.

A deal allowing the council to begin work on the upzones this summer may have been attractive to the city, and the plan has stirred less controversy in some areas than others, so SCALE members have been open to a staggered process, Thaler said.

No settlement materialized and the parties have yet to meet in August.

“I don’t think either side appreciated how entrenched the other was,” said Thaler, president of the Fremont Neighborhood Council.

Hypothetically, the talks still could resume. Yet with the council now on break for the rest of August, a window has closed.

“We continue to listen to people on all sides of the issue but at this point we’ve eclipsed the opportunity to take up MHA before the budget,” Johnson said.

Complex issues

The matter has dragged on for years mostly because land-use changes are complex, rather than because the MHA plan is so controversial, said Marco Lowe, who served as an aide to former mayors and is now a Seattle University adjunct politics professor.

Just 6 percent of all Seattle land now zoned exclusively for single-family homes would be upzoned, and no council members have disavowed the plan. Environmental reviews can lead to delays but are necessary checks on the city, he said.

“For better or worse, this is how long these things take,” said Lowe, government-affairs director at the Master Builders Association of King and Snohomish Counties.

Not everyone has the luxury of time, however.

In some neighborhoods where MHA upzones have been proposed, such as Rainier Beach, soaring property prices and rents are threatening to displace low-income communities and communities of color, said Giulia Pasciuto, policy analyst at Puget Sound Sage, a political advocacy group.

There are other reasons the real-estate market is heating up in Rainier Beach, and the MHA housing requirements are supposed to offset the value of the upzones.

But some advocates watching the market think the city’s plan is helping to drive the activity, said Pasciuto, whose organization wrote to Johnson in May with concerns.

A number of other local organizations, including Rainier Beach Action Coalition, Got Green and Interim Community Development Association, signed the letter.

Under the city’s plan, developers would need to devote 5 percent to 11 percent of their projects to affordable housing or pay $5 to $32.75 per square foot.

Though the signers support more housing, “MHA in its current form may cause more harm than good in specific neighborhoods” because the proposed requirements “will not adequately slow increasingly speculative land values,” the letter said, calling on the council to increase the requirements and guarantee that payments collected from projects in neighborhoods such as Rainier Beach be spent in those same neighborhoods.