Tax credit provides affordable housing to Seattle's homeless

The spending bill Congress passed this month included an additional $3 billion for the federal low-income housing tax credit. The credit was developed to provide low-cost housing to high-need communities, especially in expensive cities like Seattle. 

Grant Hindsley/
A new supportive housing project, The Estelle, stands completed on Rainier Ave S on Feb. 27, 2018 in Seattle. The Estelle, like Patrick Place, offers the homeless subsidized rent and social services, and was financed by the federal low-income housing tax credit.

Five years ago, Dennis Bateman's life was in shambles. He had just been released from prison for the fifth time. A teenage runaway from foster care who abused drugs and alcohol, he was addicted to heroin and methamphetamines, and sleeping rough.

Today, the 64-year-old lives in his own Seattle apartment, decorated with house plants, knick-knacks, and a guitar, has been sober for almost two years and holds a steady job.

The roof over Mr. Bateman's head is a four-story, 68-apartment building called Patrick Place, which provides the homeless with subsidized rent and help with the mental, physical, and addiction issues that often accompany them through the door.

Patrick Place was financed by the federal low-income housing tax credit, which encourages private corporations to invest in affordable housing – for people who are too poor to pay market rates – by earning credits against their corporate income tax.

"Without the tax credit, Patrick Place may not have been built," said Bateman, who was offered the apartment after a year living in a homeless shelter.

The scheme, set up in 1986, provides housing for more than 13 million people in the United States and is responsible for 90 percent of all affordable rentals, said Sen. Maria Cantwell (D) of Washington State, where Seattle is the largest city.

Ms. Cantwell visited Patrick Place on Tuesday to celebrate a boost for the scheme as Congress approved a spending bill this month that will give it an additional $3 billion of federal funds over the next four years.

There is a shortage of 7.4 million affordable homes for renters on or near the poverty line, according to the National Low Income Housing Coalition, an advocacy group.

Homelessness ticked up last year for the first time since 2010 because of a lack of affordable housing, said the US Department of Housing and Urban Development.

The expanded tax credit is projected to produce 29,000 additional affordable homes nationally over the next four years, Dan Watson, deputy chief of the regional housing authority, told a news conference.

Cantwell launched a campaign to increase the tax credit two years ago at Patrick Place, a spotless building with a computer lab, on-site mental health and addiction counselors, and a rooftop patio with sweeping views of the downtown skyline.

"We're here today to celebrate the fact that the campaign has been answered with the first investment in 10 years in affordable housing," she said.

"For us in Puget Sound, at least three to four more Patrick Places will be built each of the next four years," she said, referring to the greater Seattle region.

In Seattle, the average rent for a one-bedroom apartment is $1,842 per month, said Kim Herman, head of Washington State Housing Finance Commission, a quasi-state agency that administers the tax credit locally.

The city is among the top five most expensive for renters in the US, according to the US Census Bureau.

"Affordability, the housing crisis, and the related problem of people experiencing homelessness, is the moral challenge for Seattle right now," said Seattle Mayor Jenny Durkan.

Seattle and its surrounding suburbs have the third-largest homeless population in the US, government data shows.

Ms. Durkan also called for federal government funding to improve mass transit and address opioid addiction in Seattle, which has soared in the wake of a national opioid crisis.

"In the city of Seattle, [opioid addiction] is a crushing burden on people and it is such an exacerbation of our homeless situation," she said.

"Yet we are left without the resources to actually make a difference there in so many people's lives."

This story was reported by Reuters. 

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