Reader view: Don’t upzone Grandma from her home

I recently attended a get-together where everyone was in the “senior” age group. Surprisingly, the conversation had two divergent topics – travel now that COVID is “over” and property taxes. Many in the group were very upset by the increase this year in their property tax bill. And, not without reason, those engaged in the tax conversation were wondering just how someone on fixed income is supposed to keep affording these increases. Food prices rise, utility bills rise, energy prices rise, entertainment prices rise but returns on investments are down and the annual COLA for Social Security does not match the inflation rate. Several of those in the conversation on taxes commented they were one or two more increases away from having to sell their homes. But, the conundrum this poses is – move to where? Out of Western Washington? Out of Washington? Someone said, “Why should I have to move away from my doctor, my friends, my family?” It was a disturbing finale to the conversation with a sense of pure frustration emanating from the group. They did not have kind words or thoughts to voice about those raising the taxes directly or indirectly.

This conversation stunned me for several reasons. I know that those of us who live on fixed but comfortable incomes watch outflow of dollars closely. But, I had to stop and think what the current housing bills being considered by the legislature might mean to the folks in the group conversation I had just heard. As I thought about the impact, I realized that even financially secure seniors are at great risk of displacement by E2SHB 1110, ESHB 1245, EHB 1337/ SSB 5235, and ESSB 5466 as drafted. I talked with someone who understands how property taxes are set to help me sort this question through in my mind. I wanted to make certain I was not seeing a snake in the grass when it really was just a twig. I discovered that, indeed, these bills create a very real risk of displacement for our valued senior citizens secondary to these land use changes being considered by the legislature.

Let me share how this will happen. One or more of the above bills pass and are signed into law. There are developers out there waiting to buy property that can be built more densely as these proposed laws allow. I know because I am getting weekly calls already! And their prices are very tempting! So, the developers come to someone and offer to buy their home for the market rate or just above market value, let’s say $1.1 million. The developer tears down the home and proposes to build 4 townhomes [middle housing]. In doing so, that changes the value of the underlying land on which the home existed. While it may have been worth $ 450,000 on the last assessment, the assessor may now value the land in total at $ 1.0 million because it can be developed for 4 houses rather than one.  However, the change for that one lot may also trigger an increase in the valuation of the land for other homes in that given area because they can also be developed with middle housing of some type, a concept called “highest and best use”[ term definition, page 4]. When the city or taxing authority for the land decides to increase their property tax by the allowed yearly 1%, those new valuations trigger increases in the property taxes for all those whose land valuations were increased.

Senior citizens are critical members of any community. Their attention to things political, environmental, social, and spiritual enrich the well-being of all. If a senior wants to sell his/her home and find a small residence in which to live, they should be able to do that without fear of a capital gains tax penalty. But, if a senior wants to stay in her/his home and can do so, their independence should be cheered. They should not be run out of their homes because of skyrocketing property tax valuations triggered by legislation that created an unintended adverse impact. Each senior resident has invested years of tax dollars for the good of the community – their welfare, including their ability to keep their home, should be part of the consideration of any housing legislation. Displacing seniors or residents of modest means of any age or background from homes they worked hard to acquire and maintain while raising families and improving their community in many ways is not the right thing to do.

The bills mentioned above are cumulative in nature so it is possible than one lot could be split, middle housing built and ADU/DADU’s added to create 6 homes of unknown cost to build and buy where one home at an affordable cost used to exist. Each of those changes hold the potential to trigger land valuation increases and subsequent property tax increases that displace seniors or any person of modest means.

The displacement concern discussed in this view is not the only reason to not like these bills. However, it has received very little notice despite the rather broad impact it could have. Given the discussions on property taxes I heard recently, I felt it was a concern that needed a little “light of day” airing in a public space. You may want to share this unintended consequence of the housing bills with your friends and family across Washington state.

— By Karen Haase Herrick

Karen Haase Herrick lives in Edmonds

  1. A stock broker once told me that I should be glad to pay capital gains tax as it meant I was making money. Same holds true for houses. If a person is being “priced out” then their house is increasing in value and that is a good thing. There are several programs to protect seniors from having to move from their houses as property taxes increase. The web site is here: Depending upon income, property taxes can be postponed, reduced or in some cases written off by Snohomish County. The law protects seniors from being forced to move.

    1. Capital gains are taxes paid at sale. Stocks are not where one lives. Stocks are not subject to capital gains until sale, not something you pay taxes on year after year. Living in a modest home with a high value does not make that home owner wealthy unless and until they sell. Until they sell they will pay property taxes on potential value of the land…not the actual value to them of their home. Many seniors worked hard to own their homes and have paid property taxes for decades based on the single family zoning. Even new buyers will have a larger property tax bill if they want a single family home (which most do) and which increases the cost of the home making it less affordable. Upzoning is a way for the State to gain revenue, nothing more and nothing less. To force anyone to apply for a property tax adjustment (which may or may not be granted) because they can’t afford the taxes is offensive to proud folks who did the right things for decades only to see being forced out when they had counted on being able to age in place all these years.

      1. People that have stock accounts such as 401 Ks and other tax deferred accounts are required to sell at I think age 72 a portion so the government can collect taxes. It’s called Required Minimum Distribution. Correct me if I am wrong. This I believe only applies to older people. I mention this as when this stock is sold the people must pay income on that saved amount. Saving for retirement so they do not have to be a burden on society or their families. SO again the older get a bit of the shaft. All for trying to save and do better and be able to live a good life and still help others too.

        1. You are correct that RMDs must be taken beginning at age 72. The amount that is taken is fully taxable because it is taken from a fund, typically an IRA, on which no taxes have ever ever been paid.

    2. In regard to property tax deferral programs, the qualifications are quite restrictive and the income level threshold is low especially with current high inflation and cost of living. Certain disabilities may qualify for property tax deferral.

  2. Thank you a thorough and clear explanation of the tax ramifications of these bills. Our legislators, Ms. Ortiz-self, Mr Strom Peterson, and Mr. Marko Liias understand this as well as the fact that these bills won’t result in “affordable housing, but still support these bills and as of the Town Hall meeting show no sign of changing their minds. So far they haven’t given a believable reason for this support, and clearly no longer represent their constituents I think that it is time for all three of them to be voted out the next they are up for election.

    1. After this there will be many I do not vote for again in any capacity. I will do my best to help shine the light on those who are not truly team players but just pawns in a game of power. I expect many feel the same and many just won’t say it. Its private the one private thing left voting. You can vote for whoever you think is the best choice for all and no one need ever know who you voted for or why. I know one thing I will never vote for this Governor again. He has gotten carried away and his citizens are no longer happpy or safe or respected. So we need to find a new candidate for Governor of WA. It should be a person who is a down the middle thinker. One who is patient and takes personal responsibility for our destroyed state which is getting worse by the minute.

  3. Proponents of the bills talk about it helping seniors stay in their home. This article is correct and that idea is a fallacy. Thanks Karen and MEN for spreading this important information. Ben Cain

  4. Thank you for this article that emphasizes what should be an unacceptable outcome of property taxes; displacing seniors who have, in many cases, owned their homes for decades. The proposed legislation will only make an unacceptable situation worse. We need a property tax overhaul to make sure seniors are not driven out of their homes because they can’t pay their taxes, not legislation to make it even more likely that this will happen.

  5. Thank you for bringing this back to our awareness. We should all be paying close attention to what is being passed in the house and senate that will affect all of our communities and seniors ability to stay in their homes. Your summary of what will happen when the bills are passed is clearly spelled out!

  6. I hear your concerns but older homes are currently being sold and torn down to build large, new, single family homes. This also affects property values and does not lead to more middle income housing. Property values do rise in conjunction with the increased housing costs we have seen in our area. That is happening already. I am not sure the housing bills in this session will make it worse.

  7. Another unintended consequence of these bills is the reduction of affordable housing. In a fairly recent example near Five-Corners, a 3 bedroom rambler sold for about $550,00 and was replaced with a four-plex that each sold for more than $900,000.

  8. Another concern for Edmonds seniors is rent increases. There is no protection for us. HASCO is non-profit, tax-exempt but they keep increasing rents 15%/yr. Why??? They are tax-exempt.

  9. Supposedly wise men, like JFK, Reagan, and Trump, have gotten tax law passed over the years that favors and shelters extreme wealth, i.e. rich people and corporations. We used to tax excess wealth at up to 90% at which time we had a middle class, low cost upper education, free state and national parks, and some tax support for housing people who just wouldn’t or couldn’t cut it economically for whatever reasons. It wasn’t perfect for sure; overt racism in the South and Covert racism in the North, but that’s another issue. Instead of a necessity, housing has become a place to accumulate and store great wealth and that is why there is none that is “affordable.” These state up zone laws are a hoax and it’s time to quit believing in the Tooth Fairy (trickle down economics and political solutions to our problems).

  10. Building skinny multi-level duplexes on single family lots is going do nothing for seniors or others with accessibility issues. These bills are nothing but a shameless tax grab by our legislators, Ms. Ortiz-Self, Mr. Strom Peterson, and Mr. Marko Liias

  11. Thank you Karen. Indeed, I have been in the same discussions with folks many times. People complain about taxes, yet do not cut any services! I wrote a county council member asking that he support lowering taxes and by cutting services, particularly for example, failing programs like the homeless problem, (which is actually the drug addiction problem). King county spends $129 million per yr of our tax money on this. And every yr we have more homeless coming here to support. Politicians’ solution? More money, of course! That means more taxes. The councilman’s reply-“No one gets elected by lowering taxes by cutting programs”. That says it all. Your group complains but I’ll bet that they just keep voting in the same old tax and spend politicians over and over again. You want change? Vote for the other party. But no, they won’t. So, they go to the same old “solution”, blame the rich and demand higher taxes for the rich. They just keep reelecting the same people back to office and they just keep getting the same old results. Funny how that happens. Look in the mirror, there is your problem.

  12. The tax exemption stuff will not work for most of Edmonds seniors. Inflation and utility costs cut into the budget of most seniors and these factors are not part of the county calculations. Seniors would benefit from some form of tax delay supported by the equity in their home that is recovered when the home sells.

  13. I’m not even a senior citizen yet, and I’M WORRIED about eventually being priced out of my home. My mother & I live together, but I pay the mortgage and bills. Looked into the Senior income threshold, and it’s too high to qualify. Oh, and per the Snohomish County Assessor, my house went up $188k in ONE YEAR. This is getting ridiculous and there should be a limit to these increases. What were they assessing the year before? Completely frustrating and I say a town hall meeting would be a good idea for all to discuss this further perhaps? Just a thought…

    1. Several people have acquainted me with the massive increases in the 2023 assessed values for their homes. It appears that the county assessor is doing some catch up. The values in several prior years did not keep up with escalating market values, so 2023 was chosen as the year to get the values more in line with the market. I suspect that most homes, even with the high increases in 2023, are even now not higher than market values.

      The good news is that the total property taxes assessed by each community cannot exceed 1%. Property assessed values that have gone up more that the average for their community’s will have an increase more than 1%, and those that have increased by less than the average will have an increase that is less than 1%.

  14. This is painful for so many reasons. Is government really going to be the answer for seniors? Are federal officials really to blame for state and regional taxing and zoning policy? Let’s just be honest about it; the citizens of this city and state have chosen a vision and seniors are not in it. Get as much as you can and find an area that most likely won’t be sold out in the next couple of decades. Seniors with average income stand no chance of keeping up with the spending. Multiplexes for all.

    1. Glen I think you hit on a important problem. The young and my left leaning friends look to government to solve their problems instead of themselves. Yes government does play a role but government isn’t God nor should it be our savior it should provide for opportunity and leave the success or failure to the individual. Victimhood is rampant in society today but the reality is there is more opportunity here than just about anyplace in the world. In my opinion we are headed in the wrong direction with a lot of things. I think someone recently said Republicans and Democrats are just 2 sides of the same coin. Government is not your friend and big government causes more harm than good.

      1. Jim, speaking as a member of the young – the housing-related bills on the table this legislative session are intended to get government *out of the way* of enterprising members of our community, who are interested in creating more homes in response to a dire shortage of them around town (including for older folks with less income & resources.) Many of these bills reduce government-created requirements around housing consumption (especially in single-family areas, where seniors, like others, are required to own and pay tax on thousands of square feet of property that they don’t actually live on top of), and create a freer market for housing by allowing individuals to buy and sell housing in ways that more closely meet their unique needs (on both sides of the transaction.) I couldn’t agree more that government should provide for opportunity in our community – you’ll be glad to hear that this year’s housing legislation will reduce government’s interference in the housing decisions of individuals, and expand our rights.

        1. Mackey you make a good argument I would ask how many new rules and regulations are coming out of Olympia this year how much increased taxation are we facing. Sure I can do a little more with my property but I am still constrained the rules and regulations and cost around development are massive just look at the tree code how much will it cost me to remove a tree.. Every year government gets bigger and more controlling and more expensive crushing opportunity. With local control of zoning each community gets to shape itself with the top down approach it limits that ability so in a sense less freedom of its citizens to shape their community.

  15. In last night’s Council meeting they discussed “growth”. The game was given away when CP Tietzel asked whether ADUs and DADUs counted as affordable housing “growth”. The answer was only if a detached additional dwelling unit was created on a newly separate lot. It is about the taxes folks. That separate lot creates a new source of revenue via property taxes. That is what is has been about and will be about. The rest is just noise. “Growth” means simply more taxable properties. No more and no less.

    1. This drive to do away with single-family zoning is happening across the country and is receiving national news coverage; it likely has originated in the white house. It appears likely that the housing growth numbers were first established and then that determined what the population growth numbers needed to be. A target of 13,000 growth in 2044 for Edmonds is nonsensical when we’ve grown by only a few thousand in the past 20 years.

  16. Jim and Mackey, how is taking away local control of zoning any sort of shrinkage in government or freeing us from government control? It’s a switch on which government level is allowed to call the strikes.and balls. You are both making this “government” thing too simplistic . Unless you want to live the law of the jungle where might always equals right; government is, and will continue to be, a necessary aspect of our lives. As one moves to the Right, ideologically speaking, the role of government is thought to be minimal in all respects, except, perhaps, national defense and women’s health.. As one moves to the Left, the theory is that government should be involved in all our decisions and needs, such as housing, health care and employee/employer relations. What’s really missing in our housing debate and most other things, is what’s missing in our politics; the independent and more rational middle ground. Teach all young people to think for themselves, stand up for the rule of law (as opposed to man) and how to spend and use their money wisely; lots of our problems solved, without government intervention.

    1. Clinton the change doesn’t reduce government involvement in housing I would say it actually increases it, it does take some control away from small local government. I agree we do need government but I certainly think government has its fingers in to many things. I don’t know the exact number but have heard it can cost more than 50 thousand in permitting and fees before you could even break ground on a dadu. In my mind all this government is too excessive.

  17. State and local government both have control. The difference is that local government is 1. Is more likely to know what is more appropriate for a given municipality, and 2. local government is more likely to be responsive to it’s citizens. Our State Senator and Reps don’t seem to care what we think, but 6/7 of our City Council and Mayor do.

  18. In regards to housing, the theory from the Left, according to Mackey, is that these state zoning measures are getting “the government” out of the way of preventing needed answers to our housing problems. In other words anyone owning a single family home is somehow contributing to the lack of available and affordable housing. I can’t make anyone not believe that nonsense, so why bother.

    I’m suggesting that “the government” has nothing to do with either causing or solving the availability or affordability of housing. My suggestion to Mackey is that he and one or two of his best friends get as good a jobs as they can, quit buying $6.00 lattes at Starbucks and eating in restaurants three days a week or more, hit up their parents or rich uncles for a down payment and purchase a run down McMansion with at least four unused rooms as well as two bedrooms. Rent out or sell rooms in the McMansion to other under paid young people for a grand a month and start accumulating some real estate wealth of their own. Just disobey whatever local zoning laws would prevent this; but so carefully.

    1. Clinton be nice, I was once young and not nearly so smart. I would bet Mackey is well on his way to being successful. I don’t agree with his position but I do appreciate his willingness to engage. And yours for that matter. The future needs to be nurtured, the present scrutinized and the past remembered.

  19. I didn’t think I was being mean, but if it felt like that, I apologize for sure. I thought I was giving some good advice to Mackey and other people in his generation who I think are generally being sold a bill of goods by both extreme sides of our political spectrum and the fat cats who have come to run the country with lots of friendly to them rules on power and taxation. If you pay $6.00 for a cup of coffee and maybe $5.00 for a bran muffin plus a tip at Starbucks three or four times a week; you are just making Howard Schultz rich and yourself poor. That’s about 50 bucks that could be going into your 401K. When you pay rent you are buying someone else a home. Our whole economy is based on about 80% of the population being financially illiterate and a slave to low wages and revolving credit.

  20. You are correct in everything you say above Clint. It is excellent advice and advice we took and we sacrificed to make it work, it did. My husband used to talk to young people about exactly what you are saying and how if they start young even with minimal amounts will be able to quit investing earlier. Compound interest, right? Your advice is sound Clint. I want these youngers to make it too. But first they need to get a coffee pot and a muffin tin and save that money. I like your idea of buying a home together too. I think that could be interesting and work for many young people or even people up to the say 60’s. And if necessary beyond 60’s for forever as needed. Don’t let Government and Assisted living take all of your money and leave you on state aid. That is what happens kids. It happens every single minute.

  21. I don’t think Clint or anyone else on this forum is being “mean” when they states an opposing philosophy to Mackey (or anyone else) because everyone should know, even the young, that when you enter the arena you are exposed to opinions and statements you may not want to consider or even hear. Mackey is smart enough to know this. Remaining polite is extremely important and most who comment are respectful. What I really admire about Clinton’s posts is that he thinks matters through for himself and does not just repeat what he has read on some website, and that means a fresh outlook in many cases.

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