Seattle mayor proposed $2M loan for social housing before tax cash arrives

(The Center Square) – Seattle Mayor Bruce Harrell is proposing a bill to provide the Seattle Social Housing Developer with a $2 million loan until new payroll expense tax revenue rolls in.

The Seattle Social Housing Developer is a public development authority created by Seattle voters through Initiative 135. Its purpose is to develop, own, and manage permanently affordable, mixed-income housing in Seattle. This means the housing will be publicly owned, preventing it from being subject to market speculation, and will prioritize affordability for residents across a range of income levels, with rents capped at 30% of a tenant’s income

If the proposed bill is approved by the Seattle City Council, the developer will use the $2 million to sustain its core operations and potentially pursue property acquisition opportunities, according to a press release from Harrell’s office.

In February, Seattle voters approved Proposition 1A, which creates a 5% tax annual compensation above $1 million paid in Seattle to any employee and would provide more than $50 million per year to the Seattle Social Housing Developer.

The first tranche of new revenue generated by this tax is expected to be received by the city in early 2026.

In the press release, Harrell said that while there were different strategies to fund the social housing developer, his office “shares a vision for this model to be successful.”

“This loan will provide critical support during this interim period for planning and capacity-building so that the developer is set up for success and can achieve its goal of operating publicly owned, mixed-income housing,” Harrell said.

The city provided $870,000 in financial assistance to the developer as part of an obligation for start-up support for the first 18 months of operations.

The Washington State Department of Commerce has also provided an additional $180,000 to the Seattle Social Housing Developer, bringing the total start-up support to approximately $1 million.

With the initial funding, the developer was able to hire staff including its first Chief Executive Officer Roberto Jiménez.

The final city payment of start-up funding was dispersed in March. Harrell’s office notes that if the $2 million bridge loan is not approved, the Seattle Social Housing Developer would “face tough financial decisions until the new revenue is received.

The proposed legislation will be considered by the Seattle Finance, Native Communities and Tribal Governments Committee at a later date before facing the full city council for a final vote.