Reasons for Voting NO on Home Occupation Bill (CB 120001)

The year-round University District Farmers Market, photo by Seattle Times

March 12, 2021 Update:

ALERT: The full City Council is voting on this land use bill this coming Monday, March 15, 2021. I’m disappointed this bill was rushed to the full City Council by invoking an exception to our parliamentary procedure rules which state, “If a committee recommendation is not unanimous: Unless otherwise authorized by the President and the committee Chair, the committee report shall be reported to the second regular City Council meeting after the date of the recommendation” (page 25). Therefore, Council President Gonzalez and Chair Strauss (both co-sponsors of the bill) unfortunately decided to use their powers to skip the additional week of public review time to speed it to a full vote. (I appreciate that Chair Strauss provided ample time in his Committee for me to articulate my strong track record for small business as well as my concerns with the bill. I wish there had been more time, however, for more input from existing small businesses and communities.)

March 10, 2021 (original post): Many of us are grateful for the small businesses in our neighborhood business districts that provide not only jobs, goods, and services but also fun, flavor, and funkiness. I have consistently supported small businesses throughout Seattle. In fact, my concern for the recovery of EXISTING small businesses, our neighborhood business districts that support them, and the potential unintended consequences of yet another change to Seattle’s complex land use codes are my primary reasons for voting No on Council Bill 120001.  I expand on the reasons for my vote below.

(For the original press release from the sponsors in favor of the bill, CLICK HERE.)

Despite my concerns about the bill, I would like to thank the original sponsor, Councilmember Dan Strauss, for providing enough time to consider this legislation in an era when bills are often rushed too quickly through the Seattle City Council.  While the bill was discussed quickly after it was introduced, Chair Strauss provided ample time and grace in his Committee to air the concerns and to provide staff time to analyze it. Ultimately, though, the subsequent memo from our Central Staff analyst, conversations with the department that will implement this, and, most importantly, my outreach to small businesses did not alleviate the concerns I raised during the previous Committee meeting on February 24.  In fact, many business districts had not heard of the legislation and offered additional concerns.

I worked hard last year to renew the neighborhood business improvement area (BIA) for the University District in the heart of our City Council District 4. For small businesses throughout Seattle, I supported several financial and regulatory relief and recovery programs throughout the COVID pandemic.  In addition, my recent Op Ed for an inclusive economic recovery points to many ways government can work with local employers to get people back to work and achieve an inclusive economic recovery. I also bring to the table significant private sector experience. After studying the issue, CB 120001 is, in my opinion, not an effective answer and could do more harm than good. Here are 10 reasons why:

  1. HOME-BASED BUSINESSES ALREADY ALLOWED: Seattle Municipal Code (SMC) Section 23.42.050

For details on each, please read on…

  • HOME-BASED BUSINESSES ALREADY ALLOWED: First, it’s important to reiterate that you can already operate a business out of your home. Our Seattle Municipal Code (SMC) Section 23.42.050 CURRENTLY states, “A home occupation of a person residing in a dwelling unit is permitted outright in all zones as an accessory use …” subject to various requirements. The requirements essentially require the business to keep a low profile externally and minimize impacts to neighbors. (CB 120001 would remove some of those requirements to benefit the home business.)
  • QUESTIONABLE NEED FOR CITYWIDE CHANGES: We have not heard from home-based businesses requesting these proposed regulatory changes, except for the popular Yonder Bar business which has since secured a location near other businesses. According to the Seattle PI news site, “Yonder Cider and Bale Breaker Brewing to open Ballard taproom this summer.” While we received e-mails in support of CB 120001, it appears that most were spurred by an e-mail campaign launched by Yonder Bar in northwest Seattle, rather than arriving organically from a diverse or citywide effort. Neither our Central Staff analyst working on this bill nor the Seattle Department of Construction & Inspection (SDCI) that would implement the bill has a list of home-based businesses seeking or needing the proposed changes. While it’s possible there are some aspiring home businesses that could benefit, I do not think it’s appropriate to make citywide land use changes based on anecdotes or conjecture.  In short, this bill could currently be considered more of “a solution in search of a problem” than addressing an urgent specific or widespread need. Allowing for one-off exceptions, rather than blanket, citywide changes would be more targeted and appropriate.
  • COULD HURT SMALL BUSINESS DISTRICTS / CLUSTERING BUSINESS TOGETHER IS BETTER:  I am very concerned that suddenly lifting restrictions to allow retail food and alcohol businesses on any block in our city will draw customers away from existing neighborhood business districts and their struggling small businesses.  In addition to the 10 Business Improvement Areas (BIAs) spread throughout our city, there are many other small business districts that rely on foot traffic generated by several shops clustering together – more customers are attracted to each area to efficiently take care of their daily needs for goods and services. In addition to the University District BIA, there are many neighborhood districts just in our District 4 such as:  Eastlake Avenue, Ravenna (NE 65th Street), Roosevelt, and Sand Point Way NE (at Princeton Ave), Wallingford (North 45th Street and Stone Way), and Wedgwood (35th Avenue NE). Much of the outreach I conducted directly with owners of small businesses yielded serious concerns. These small neighborhood businesses are struggling today to bring back customers and workers. They are in the middle of multi-year commercial leases for their storefront space and some of them have made substantial investments for outdoor dining to meet public health requirements. Having the city government suddenly toss aside the current rules to let anyone run a retail, food, or alcohol operation out of their homes or garages, will drain customers away from the existing small businesses we say we want to help emerge from the pandemic. Let’s instead first help businesses to stay in business and re-hire their workers. (Other ideas for incubating new micro businesses are below)
In addition to the 10 Business Improvement Areas, there are scores of neighborhood business districts throughout Seattle that rely on the clustering of other small businesses to generate foot traffic of customers.
  • U DISTRICT BUSINESS DISTRICT NEEDS UNDIVIDED ATTENTION TO PROTECT ITS DIVERSITY:  Approximately 65% of small businesses in the heart of the U District business improvement area are owned by women and people of color. Let’s focus first on supporting these existing businesses – especially those that have had to shed jobs — so that we don’t lose them and so they can rehire all their workers and emerge successfully from the COVID pandemic. [For a list of many small businesses open throughout D4 and Seattle, you can explore this website “to find and support local businesses and the diverse people behind them through everyday decisions about where we eat, drink, and shop.”]
Many small businesses have recently spent thousands of dollars for new “streeteries” and other outdoor dining areas
  • CLOAKED IN COVID, BUT LASTS FOR AT LEAST ANOTHER YEAR:  Here’s the title of the proposed law:  “AN ORDINANCE relating to land use regulation of home occupations; adopting interim regulations to allow home occupation businesses to operate with fewer limitations during the COVID-19 civil emergency, amending Seattle Municipal Code Section 23.42.050, and adopting a work plan.”  But the Council Bill is NOT actually tied to the COVID pandemic or even to a “civil emergency.” The memo from our Central Staff analyst states, “Because CB 120001 would be adopted pursuant to RCW 36.70A.390, which allows jurisdictions to approve interim development controls, the bill includes a work program for the Seattle Department of Construction and Inspections to analyze and propose more PERMANENT changes to home occupation regulations” (emphasis added). In other words, these changes would be put on track to become permanent.  

(I believe the City Council should soon start transitioning away from using COVID as the reason for new legislation and we should instead have proposals stand on their own merits as we take a post-pandemic, long-term view.)

  • DISTRACTS KEY CITY DEPARTMENT FROM OTHER IMPORTANT WORK:  Our Seattle Department of Construction & Inspections (SDCI) is already behind on improving permits and delivering an overdue ordinance to protect our trees. Saddling the city government staff to develop and monitor this new program — and enforce future inquires or complaints about it — could delay other priorities.
  • IMPACTS TO OTHER NEIGHBORHOODS: Policymakers need to be careful NOT to stop legislation just because it might alter neighborhoods — as long as the people impacted have ample opportunity to provide input and policymakers genuinely consider that input, as long as the city will be receiving ample public benefits for anything the city government gives away to the private market, and as long as the changes are prudent, sensible, and reasonable. So, while I believe we have a sufficient number of other concerns about why this legislation might not be prudent, it’s important to recognize what I’ve heard from some neighbors who might not be happy with the increased traffic, reduced parking, new retail signage, and nearby activity of employees and customers coming and going in their residential neighborhood.
  • NOT TO THIS EXTENT IN OTHER CITIES: To avoid unintended consequences, it’s often helpful to see whether other cities have adopted the legislation. Before pioneering risky experiments with Seattle residents and businesses, we can learn from other cities and their false starts, sharp edges, and outright mistakes. Our Central Staff analysts did not find other cities with such loose regulations on home businesses.
  • OTHER UNINTENDED CONSEQUENCES:  Granting the business rights to single family structures could increase their value and make them less affordable. Moreover, aspiring businesses may choose to buy a house and convert it to a business which would further draw away customers from the neighborhood business districts. In addition to drawing away customers, it could draw away small business tenants that are renting commercial spaces, thereby decreasing the value of those properties as costs rise for homes. 
  • INCUBATING TOGETHER:  Moreover, incubators typically work best when they cluster together in — you guessed it — existing business districts. The new startups share space where they not only benefit from cheaper rent and shorter leases, but also learn from each other, receiving technical assistance together, and attract customers together. 
  • FARMERS MARKETS: Those hoping to make and sell food and drinks (using local farm ingredients) could use Farmers Markets to sell their products rather than trying to attract enough customers to their house. For U District, West Seattle, and Capitol Hill Farmers Markets, CLICK HERE. For other Farmers Markets in the Seattle, CLICK HERE or HERE.
  • EXCEPTIONS RATHER THAN BLANKET CITYWIDE CHANGES:  As mentioned earlier, the legislation does not seem to be addressing an urgent specific or widespread need. Therefore, allowing for one-off exceptions, rather than blanket, citywide changes would be more targeted and appropriate.
A rare opening of a new store DURING the pandemic (on The Ave in the University District).

Let’s continue to encourage shoppers to come back to our existing neighborhood business districts!

More Info:

_ Links to Council Bill 120001 and an analyst memo, CLICK HERE.

_ For the press release supporting CB 120001, CLICK HERE.

_ For an article by the Seattle Times, CLICK HERE.

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