Wei Yao and Cameron Smith: Salt Lake City can’t be both pro-developer and pro-tenant

It is foolish for Salt Lake City to expect developers to do anything against their own interests.

(Leah Hogsten | The Salt Lake Tribune) The Oxford Place Apartments on 300 South in the shadow of The Cottonwood apartment complex, Tuesday, July 12, 2022. A new study says gentrification is rampant across Salt Lake City, with new development and rising rents squeezing out existing residents and cherished businesses and leaving no affordable neighborhoods in terms of housing.

The recent studies confirm what tenant organizers have been saying for years now; there is a housing crisis. This crisis is deep, severe and threatens to derail the city’s growth entirely.

Worst yet, the solutions currently on the table are fundamentally wrongheaded. The city is pretending to walk a “middle path” between pro-tenant and pro-developer policies. But in reality these proposals are deeply pro-developer and anti-tenant.

The “Affordable Housing overlay” that has been brought to the Salt Lake City Planning Commission allows developers to circumvent density zoning in exchange for providing a certain amount of affordable housing. The proposal we have heard sets “affordable” at rates affordable to those making 80% of the Area Median Income (AMI,) or $57,350. For those reading who aren’t aware, that is more than double the income of six of ten of the city’s most common jobs.

The gap between what is required and what is needed is supposed to be filled by free market forces of supply and demand. The assertion has been made by advocates of the housing overlay that allowing more housing to get built will increase supply, and thus lower costs, meaning both tenants and developers win. However evidence that zoning deregulations lower housing costs is thin at best. While, on the other hand, there is good evidence these measures drive gentrification and displacement.

Deregulatory plans for housing rely on developers to solve our problems for us. These plans rely on developers doing things contrary to their own interests, such as overbuilding and getting in price wars with other developers, lowering rents over time. Limiting the scope of actions to solve this crisis to “fine” managerial tools rather than blunt political instruments is fundamentally foolish, naive and entirely unproven. In contrast, public control, administration and regulation to prevent harmful opportunism has plenty of success stories.

Despite constantly feigning helplessness, the city has a number of tools to force rent costs down. One example is restricting zoning incentives to projects providing a significant amount of units at 30% AMI (less than $500 a month), and to expand the areas in the city where acquiring zoning incentives would be necessary to build apartments. This is explicitly allowed in the legislation that made city-wide affordability requirements illegal at the state level.

A more serious and practical solution would be to funnel money away from redevelopment agencies, unsheltered camp abatements and unnecessary road renovations to publicly owned or subsidized housing projects. The city and state spent $67 Million on Operation Rio grande and accomplished close to nothing. The city has countless frivolous expenditures that materially provide nothing for residents of this city. All this money should be used to build publicly owned, rent-controlled housing units.

In the short term, public housing can be used to artificially oversupply a neighborhood. City money can be used to subsidize rent income on the back end in exchange for artificially low rent listings in high-demand neighborhoods. In the long term, the public sphere can provide stable, not-for-profit housing in a way that is democratically controlled and driven by need rather than profit.

Public options, if pursued seriously, could allow the city to provide housing for its poorest residents without ever needing to negotiate with developers who have no connection to our city beyond a desire to make money off of it.

There are innumerable, simple, sustainable solutions to housing. All of them require confronting developers and their interests and cutting them out to some extent. Furthermore, none of these solutions are novel or new, they are policies that were widespread in this country, and were axed with the rise of Reaganomics and neoliberalism for political reasons.

Similarly, our city leaders’ clouding of the issue and deference to “experts” has more to do with their personal and political motivations than the needs of Salt Lake residents.

Renters in this valley need to organize and gear up for a serious political struggle to stampede past anybody too cowardly or conflicted to stand up to developers. City leaders need to consider which side they are on, because standing on the fence is no longer an option.

Wei Yao

Wei Yao is a University of Utah graduate and resident of Salt Lake City’s Ballpark neighborhood.

Cameron Smith

Cameron Smith is the founder of Borderless Operations Solutions.

They collaborated to author this article in support of Wasatch Tenants United.