Editor’s Note: This is the fourth and final installment in a series on water and housing affordability, and explores several “what-if?” scenarios for making the island more affordable. You can find links to Parts 1, 2 and 3 at the bottom of this page.
Islanders of all stripes agree: Vashon needs more affordable housing.
Region-wide growth and its sidekick, gentrification, have supercharged housing prices and gutted the island’s rental market. Local workers and even long-time residents and their children are being forced to live or move off-island. Local businesses are struggling to find and keep staff. The economic health and very character of the community are at stake.
So what could make Vashon more affordable?
“Affordable housing” on Vashon means homes for both low-income (less than $28,000 annually) and moderate-income ($70,650 annually) islanders. The major barriers to building that housing include water, money and zoning. And at the front end, gentrification is driving the shortage of that housing in the first place.
Some efforts are already underway. Other “what-if” conversations are growing as islanders seek creative ways to tackle Vashon’s housing crisis.
For example, what if Vashon…
Gets more creative with water?
Vashon Town has been the obvious focus for affordable housing development. It offers access to water, sewer and public transportation, and it’s already zoned for higher density. Would-be developers need all of that in order to secure public and private investment dollars.
The access-to-water piece became a stumbling block in 1996 when Water District 19 (WD 19), which services the town center, imposed a moratorium on issuing new water shares. Water has been the bane of affordable housing advocates ever since.
WD 19 relaxed its moratorium last year and is considering ways to expedite affordable housing.
“We don’t want water availability to be a barrier [to affordable housing],” said Seth Zuckerman, president of WD19’s three-member, elected commission.
To that end, WD 19 allowed entrants in last year’s water share lottery to request up to five water shares, making it easier to build mixed-use or multi-family projects.
Also, after studying water consumption data for multi-family homes on Vashon, the district loosened its requirement that developers have three water shares for a four-unit building (or 0.75 water shares per unit). Now, if developers can show that their project conserves water thanks to water-saving appliances, restrictions on outdoor irrigation, etc., they can get by with less than half a water share per unit.
That means that town center developers can now build more homes with less water.
But what if WD19 went even further? The District could reserve water shares specifically for affordable housing by, say, setting aside 20 water shares for the next 15 years for affordable housing projects. If no one bites, those shares would go back into the general pool.
Or the district could allow, even encourage, its customers to donate or assign their shares to affordable housing projects — especially the roughly 150 WD 19 customers who currently hold shares they aren’t using. To discourage water hoarding, the district could issue water shares provisionally — only releasing them for a completed project.
Or WD 19 could facilitate customer-to-customer transfers, where a water share holder could assign or sell his or her share to, for instance, Vashon HouseHold directly. The District already lets customers transfer shares between their own properties, and could broaden those rules to allow owner-to-affordable housing developer transfers.
“We would allow that transaction to occur on our books, but we wouldn’t be a party to that transaction,” Zuckerman said. “That’s different from us minting new water shares just for the purpose of affordable housing.”
It could also be an easier process — legally and legislatively speaking — to put in place.
Guess what: WD 19 is exploring all these options. The District will host a public meeting in November to get community input on these and other policy changes it’s considering. But don’t expect them all to happen overnight.
“There are state or municipal laws that impose certain restrictions on how we can and cannot offer water,” Zuckerman said. “The issue is: to what extent are we allowed to allocate public resources to a specific use? We are right now studying and getting legal opinions on what our constraints are in that regard.”
All of this is welcome news for affordable housing. But water isn’t the only obstacle. Developers also need money to fund ever-costlier projects.
So, what if Vashon…
Gets more flexible with financing?
When it comes to underwriting affordable housing, Chris Bric, president of the nonprofit Shelter America Group, is a longtime fan of the Federal Low Income Housing Tax Credit.
For 40-plus years, the program has awarded tax breaks to corporations that invest in affordable housing. When Bric approached his corporate contacts about Creekside Village, Shelter America’s new workforce housing project on Gorsuch Road, they were eager to invest. But Bric never got those corporate dollars, because Creekside Village couldn’t qualify for the tax credits.
Rural communities like Vashon are at a disadvantage under Washington’s current tax credit system, which is administered by the State Housing Finance Commission. They can’t compete on the Commission’s bang-for-the-buck criteria such as population density, water and sewer service, proximity to mass transit and efficiency.
“The Commission, to its credit, has to design this program to serve the greatest number of households,” Bric said. “Well, the greatest number of households is along the I-5 corridor from Tacoma up to Everett. The affordable housing need there, in terms of population, vastly surpasses what we’ll ever have here on the island.”
And, adds Bric, the Commission’s emphasis on efficiency heavily favors large urban construction companies which can put up a housing development “cheaper than you ever dreamt you could build it for here on the island.”
But the state could create tax credit carve outs for affordable housing projects in rural and unincorporated areas, and in island communities like Vashon — where the cost is higher but the need, proportionally, is just as great.
Such set-asides would help level the playing field by putting Washington’s small rural communities in competition with each other, rather than with the state’s large cities and suburbs.
What if Vashon also …
Gets more flexible with location?
Right now, Vashon Town is the sole focus for affordable housing development. That singular focus puts pressure on Water District 19, which will have to accommodate the growth.
The town is the only part of the island currently zoned for higher density, and it is far from built out. But the island was once home to many waterfront towns.
Dockton, Burton and Ellisport, for example, were once self-sufficient communities with their own industries, stores, churches, meeting houses and ferry landings. Burton’s lively crossroads notwithstanding, much of that commercial and community activity is consolidated in Vashon Town today.
Sprinkled across the island, some modest low-rise developments that mix a little housing with a little commerce (coffee shop, grocery, bistro) and a public amenity or two (park or meeting space) could restore some of that historic energy and sense of place.
Such an investment, along with a little lobbying, might even induce King County to subsidize some form of energy-efficient public transportation that links the villages to each other and to the rest of the Island.
“It’s a really cool idea,” said Jason Johnson, executive director of Vashon HouseHold (VHH). “It would change the way I’m currently thinking about development dramatically.”
Here’s a reality check: Building outside Vashon Town wouldn’t be easy, or cheap, or quick, or necessarily popular, or maybe even possible.
Dispersal almost certainly entails zoning changes, though Johnson seems unfazed by that challenge.
“Zoning changes take a long time and are a lot of work,” he said. “But if [VHH] was interested in purchasing a property or was gifted a property and we needed to change the code, or look at density differently, we know how to do that.”
Septic would be another hurdle.
An affordable housing developer looking to build anywhere outside Vashon Town would need to find and purchase enough land to make development feasible — fitting at least 25 units — and a septic system robust enough to service them. That probably means a Large On-Site Septic System (LOSS), which are reviewed and approved, or not, by the State Department of Health.
The cost — in money, time and sanity — of the land, housing construction, septic installation, and all requisite permitting and zoning would be daunting. And there’s no guarantee of community support.
Nevertheless, like Jason Johnson, Chris Bric sounds intrigued.
“I think of Dockton first and foremost, because there’s a certain feel and architectural integrity to that old village,” Bric said. “If there was, say, a 3-5 acre parcel in Dockton, you’d want to work with a design team that had really taken in the merits and design of that historic community and present something that could fit. You have to have that respect. If you’re not adding value to the community somehow, with whatever you’re building, you shouldn’t be there.”
Adding affordable housing, wherever it goes, is still treating the symptom, not the cause of Vashon’s housing crisis.
So, what if Vashon…
Gets serious about gentrification?
According to Zillow, the current median list price for a Vashon home is $910,569. That’s up 3.2 percent from last year and 54 percent from 2016. Zillow puts the median rent on Vashon for “all bedrooms and property types” at $3,200 a month. That’s more than monthly median rents in Los Angeles ($2,842) and Washington DC ($2,523), and just $300 lower than New York.
“Western Washington has not kept pace with the housing need, especially in smaller rural communities,” allows Johnson. “But there’s something unique happening here on Vashon where housing that was historically affordable and accessible is no longer either. It has been purchased and repurposed by folks who now own really nice second and third homes here in this community — homes that used to be a permanent address for someone.”
What if Vashon monetized that trend?
An Affordable Housing Tax on the sale of homes above a certain price could generate money to support affordable housing construction or subsidize rents. Seattle, for instance, energized its art community in 1973 with the One Percent for Art program, which sets aside one percent of the cost of “eligible city capital improvement project funds … for the commission, purchase and installation of artworks.”
A Vashon home-sale tax will never rack up the dollar amounts that Seattle’s public art program brings in. But based on the current median price of Vashon homes ($910,569), a one percent tax on the sales of 10 houses would generate $91,056.90. That’s not nothing.
Along those lines, there are conversations “happening right now,” said VHH’s Jason Johnson, about instituting an In-Lieu Fee as a way to entice developers to build in Vashon Town.
Instead of including affordable units in their building projects, developers could pay an In-Lieu Fee, bolstering a fund that organizations like VHH can use to build affordable homes. The In-Lieu enticement is a common and effective practice in Seattle.
“They’re building like crazy there, and it’s creating quite an account,” Johnson said. “I don’t know if we have the scale here on Vashon for it to work.”
We don’t. But there will never be one magic antidote to gentrification. The Vashon community will have to rely on a roster of smaller, creative solutions, many of which already exist.
King County’s Public Benefit Rating System, for example, offers a tax break to private property owners who preserve open space on their land. To preserve Vashon’s dwindling rental stock, what if we offered a similar kind of tax break to homeowners who operate their mother-in-law cottages or ADUs as rental properties rather than airbnbs?
We could also consider disincentives, like slapping a lodging tax on short term rentals — and using that money to subsidize rents. Or we could follow the lead of some popular resort towns which are cracking down on what some are calling the “financialization” of housing.
In May 2023, Palm Springs limited the number of Vacation Rental Certificates it issues to 20 percent of the city’s total residential units. (Property owners who already had Certificates were allowed to keep them.)
In March 2024, Tofino joined Palm Springs — and most of its fellow British Columbia resort towns — when it, too, put a lid on short-term rentals. It was a divisive decision. But for Tofino City Council member Duncan McMaster it was the right one.
“Not only is there a risk of a generation of people never being able to afford a home,” McMaster told Victoria News, “but also the strong possibility of Tofino turning into a short-term rental ghetto.”
Make no mistake: the disincentive route comes with perils. Restricting short-term rentals antagonizes property owners, like the ones in Tofino who threatened to leave their rental units empty. It will most likely depress tourism, which would thrill some local residents but hurt local businesses. And in the end, more available rentals doesn’t guarantee more affordable ones.
Efforts to grow Vashon’s affordable housing stock face other challenges. King County’s new stormwater management requirements sent Vashon HouseHold scrambling to find an extra $1 million for its new 40-unit, Island Center Homes development when the County unexpectedly insisted on a huge underground concrete vault and plumbing system to collect and redirect stormwater on the site.
The County could soften — or help to finance — its stricter stormwater requirements so that runoff doesn’t sink affordable housing efforts.
Tofino mayor, Dan Law has watched the swift, relentless wave of gentrification engulf his town. Last spring, a rueful-sounding Law told Victoria News that, “If I had known, seven years ago, that in seven years the median value of a home would go from just over $500,000 to $1.6 million — and essentially exclude every median household income earner from owning homes in Tofino — I probably would have acted sooner.”
Hindsight is 20/20. Whatever steps Vashon takes to create more affordable homes, the island will need to move fast. The clock is ticking.
Mary Bruno, a Vashon-Maury Island Groundwater Protection Committee member, regularly blogs about water issues at vashonnaturecenter.org.
This article concludes a series about water and affordable housing on Vashon.
Part 1: Does Vashon have enough water?
