Climate Activist Faces Jail Time After Failed Necessity Defense

On Friday, October 4, Donald Jose David Zepeda was convicted by a jury on charges related to his 2017 attempt to shut off Kinder Morgan’s tar sands pipeline that delivers oil into Washington. I don’t have much additional information on his case, as the media coverage has been scant up to now. But even this bare-bones description highlights the risks associated with civil disobedience and the limits of what is known as the “necessity defense.”

Mr. Zepeda is a valve turner, but he’s not one of the official Valve Turners, a group of activists who in 2016 coordinated pipeline shutdowns across four states and have since been the subject of multiple media profiles.

The Valve Turners were charged with various criminal offenses, and at their trials they fought to present a necessity defense to the juries, arguing that the illegal acts were justified by the threat of climate change and risks of importing oil from the Canadian tar sands. One of the Valve Turners, Kenneth Ward, successfully persuaded a Washington court that the right to present evidence to support a necessity defense is constitutionally protected.

Mr. Zepeda was able to capitalize on Ward’s victory: his court-appointed lawyers were able to present a necessity defense for the jury’s consideration—Sightline’s own Eric DePlace provided expert testimony—and the jury was allowed to consider the defense as a possible reason to find Mr. Zepeda not guilty. (You can read an earlier post on the defense to get a sense of the two separate decisions involved here.)

I can’t say why the jury was not convinced, but Mr. Zepeda now faces jail time, with his sentencing scheduled for Wednesday, October 16.

Truth be told, this is a built-in feature of civil disobedience—there is always the threat of punishment for someone who deliberately breaks the law. Moreover, that possibility makes the desperation underlying the decision to act all the clearer.

But the ultimate goal of civil disobedience is not simply to end up in a jail cell. It is, as described by Dr. Martin Luther King, to create the tension needed to prompt a community to confront a pressing injustice. A necessity defense can further that aim by providing a public forum to discuss what motivated the defendant. In the climate context, that includes the peer-reviewed science detailing the consequences of the status quo and the immediate need to aggressively move towards a clean energy future.

Unfortunately, a solitary act of civil disobedience that largely escapes media coverage has a limited capacity for changing anyone’s perceptions or spurring political change. When author and activist Bill McKibben spoke at Seattle University years ago (where I teach climate change law), he told the crowd that the most important thing that an individual can do to help the climate is “become less of an individual.” This is the power that comes from large groups of people working together for change. My intent is not to criticize Mr. Zepeda but to emphasize the point that we require large-scale, institutional change if we are to seriously address the threat of climate change.

As Sightline readers are no doubt aware, there was major collective action recently, with millions of marchers in the streets across the globe demanding that governments respond to the ongoing climate crisis. Hopefully, in the months and years ahead the momentum will carry forward into actual policy changes. If that comes to pass, perhaps Mr. Zepeda will be able to take comfort in seeing the kind of progress that he no doubt hopes to inspire.

Michael Mayer practiced environmental law in the Northwest for close to a decade and now teaches climate change law at Seattle University School of Law.

Listen In: New Audio Documentary ‘Holding the Thin Green Line’

Because of its location, the Pacific Northwest plays an outsize role in determining the planet’s climate future. Squarely between voracious energy markets in Asia and massive fuel deposits in the interior of North America, the region of Cascadia is on the front lines of determining whether we’ll continue our dependence on fossil fuels or transition to carbon-zero energy.

A new KBOO audio documentary, “Holding the Thin Green Line,” by Barbara Bernstein explains what’s at stake. It’s a multi-part story told from the points of view of experts, activists, and various members of the Northwestern communities impacted by proposed fossil fuel projects.

Among the sources is Eric de Place, Sightline Institute’s director of the Thin Green Line, who is considered an authority on a range of issues connected to fossil fuel transport, including carbon emissions, local pollution, transportation system impacts, rail policy, and economics. Another Sightline researcher, Tarika Powell, lends her expertise to explain the alarming misconception that natural gas is “cleaner” than coal or oil. Tarika earlier this year published her own three-part series about dirty secrets within the natural gas industry. Methane, the main component in fracked gas, is like carbon dioxide on steroids when it comes to its global warming potential. (Read her series.)

Bernstein’s reporting focuses on:

  • A massive methanol refinery operation proposed in Kalama, Washington
  • A proposal to build the West Coast’s largest liquid natural gas (LNG) export terminal in Coos Bay, Oregon
  • A massive LNG hybrid facility at the Port of Tacoma

If the project in Kalama moves forward, it could result in the world’s largest methanol refinery. There’s evidence the project will threaten air quality, water quality, and environmental health. (Sightline wrote about the project extensively. Check out our research.)

Part One of Berstein’s project, titled “The World’s Largest Methanol Refinery,” first aired on KBOO on Oct. 4 (listen here).

(More from Eric: Despite Inslee’s Opposition, Gas Industry Still Plans Big Expansion in the PNW)

That episode also featured the Port of Tacoma project.

“Normally with liquefied natural gas, you do not site it in an urban area because liquefied natural gas is extremely combustible,” de Place told Bernstein. “If it explodes, it is an enormous bomb that can go off. So (this project is) sited right in the middle of Tacoma and they’re going to put it on ships. That raises concerns about how you’re going to move those ships safely in and out of the harbor and how you keep other ships away from them while those ships are moving.”

The next part of the series airs Oct. 28 on KBOO’s show, Locus Focus. Berstein’s reporting will focus on Jordan Cove and what would be the largest LNG export terminal on the West Coast. That proposal includes a pipeline more than 200 miles long that would cut across southern Oregon.

Learn more about Holding the Thin Green Line. You can also listen to a recent conversation between Eric and Barbara on Locus Focus. They discuss what Appalachians can learn from the Northwest to beat back fossil fuel projects, and they talk about the ongoing impeachment inquiry. Listen in.

It’s Official: DC Politicians Have Woken Up to Housing Abundance

Mark it down: It was in late 2019 that Alexandria Ocasio-Cortez introduced parking reform to the halls of Congress.

The New York Congresswoman’s call to withhold federal transportation funding from any jurisdiction that bans car-free homes by requiring on-site parking, unveiled Sept. 25 as part of a large and ambitious housing bill, is the latest thump in an accelerating riff of new pro-housing proposals that is starting to rattle mainstream US politics. 

This drumbeat of new ideas is coming three years after Chicago-based policy writer Daniel Kay Hertz scoured the major party platforms for new housing ideas and found almost nothing.


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(In case you were wondering: under this bill, only three or four major cities in the United States would currently qualify for a share of $43 billion in annual federal highway formula spending. If it became law, that’d change fast, and the change would allow many, many more homes to be built for lower prices, especially in transit-rich areas. It’d be a crucial plank in any Green New Deal.)

This drumbeat of new ideas is coming three years after Chicago-based policy writer Daniel Kay Hertz scoured the major party platforms for new housing ideas and found almost nothing.

In a prescient Nation article last year, Henry Kraemer and Sean McElwee (both affiliated with Data for Progress, a think tank that specializes in unexpectedly popular left-wing ideas) identified an opening for federal candidates to mobilize younger voters, especially renters, with housing policy proposals.

“Elected leaders have paid little attention to housing, and even less to renters,” they argued. “That’s been horrendous policy—and also terrible politics.”

That message seems to have been heard, and not only by the left.

Federal housing bills aren’t new, of course. Democrats have long tried to improve outcomes by spending more public money; Republicans have long tried to force efficiency by spending less.

What’s new is the idea that in either case, we’d be better off if we re-legalized greener, less expensive home types like apartments, fourplexes and backyard cottages in more places, especially the most exclusive ones.

Summer 2019: A rush of new ideas from both major parties

Federal leaders are increasingly looking for ways to push cities to lift bans on homes like these, in a Seattle triplex that was built before the city banned them from low-density zones. Photo by Sightline Institute: Missing Middle Homes Photo Library used under CC BY 2.0

Just like grassroots pro-housing advocates, US politicians are embracing abundant housing for various reasons: giving more people the American dream of a safe and stable home; helping more people cut their energy bills and carbon emissions; racially and economically integrating our schools; preserving the middle class; allowing economic growth; making it easier for poor people to exist.

Lifting bans on attached, manufactured and car-free homes helps more people live where they want in the ways they want for less money. It makes every Section 8 voucher go further. It reduces displacement by letting exclusive neighborhoods absorb their share of growth. It lets cities respond to economic growth the way they once could, by sharing the benefits of a prosperous city with newcomers rather than heaping windfalls on people lucky enough to already own land.

Though housing policy has yet to come up in a debate, zoning reform is suddenly a common plank in Democratic Party presidential platforms. Senators Cory Booker, Elizabeth Warren, Amy Kloubuchar and Bernie Sanders, and former Housing and Urban Development Secretary Julian Castro, all want federal funding to reward abundant-housing policies. (Kraemer and Peter Harris have been keeping useful summaries at Data for Progress.)

The YIMBY Act, introduced in July by Indiana Republican Sen. Todd Young and Hawaii Democratic Sen. Brian Schatz, would apply this idea to federal community development funds. Two weeks ago, a similarly bipartisan crew of sponsors that included Cascadians from both major parties (Democratic Rep. Denny Heck of Olympia and Republican Rep. Jaime Herrera Buetler of Ridgefield) introduced the companion House bill.

“A larger federal role in reducing local barriers to development appears to be one area with potential for bipartisan cooperation,” wrote the Brookings Institution’s Jenny Schuetz in July.

Heck and Republican Cathy McMorris Rodgers, of eastern Washington, are also cosponsors of the Build More Housing Near Transit Act introduced last month by San Diego Democrat Scott Peters. That bill would base federal transit grants more closely on whether cities have also legalized additional homes nearby, both market-rate and below-market, to help more people take advantage of the new trains and buses.

Abundant housing is good no matter who is building the homes

Image by David Mark from Pixabay, used with permission.

This fall’s new bill from Ocasio-Cortez, though, is the most ambitious on housing abundance by far. In addition to the huge penalty for cities that refuse to end parking quotas, it would also penalize cities that ban apartments and mobile parks and reward cities for re-legalizing backyard cottages and taxing vacant land.

There’s more in her bill. (Federal investment in lead cleanup is long overdue.) One provision that’s drawn criticism is her proposed 3 percent cap on most rent hikes, even in new buildings. Even sympathetic analysis of rent regulation usually concedes that capping price hikes in new buildings might backfire on poor tenants by triggering drops in rental construction, leading to rock-bottom vacancy rates and high prices when people need to move. But Sanders’ plan, which also caps rents in new buildings, offers a way to correct this: spending $2 trillion to build 9 million new or rehabbed homes over 10 years. If that were to actually happen—Sanders wants to pay for it with a wealth tax—it would account for about 80 percent of current annual homebuilding, likely enough to offset the drop in private construction.

In any case, it’s a similar story either way. Whether the United States were to “decommodify housing” by socializing the rental homebuilding industry, or keep using its current, privately financed system, the country would be able to help far more people if we lift bans on apartments, backyard cottages, mobile parks and car-free homes.

That’s the great promise of abundant-housing policies like the ones Ocasio-Cortez proposes: They’re good ideas no matter what your preferred system is for homebuilding.

Abundant housing would make capitalism better; abundant housing would make socialism better.

“Anything that we can do to encourage more infill and housing stock within our cities is just really important,” said Joel Madsen, executive director of the Mid-Columbia Housing Authority in Hood River, Oregon. Madsen supported Oregon’s recent legalization of “missing middle” housing—the sort of reform Ocasio-Cortez’s bill would incentivize—because he thinks it’ll create more homes in the price range that one of his agency’s Section 8 vouchers can subsidize.

“I’m not saying that supply is the only solution to our housing challenge by any means,” Madsen said. “Supply is part of the solution.”

He’s exactly right. Abundant housing doesn’t, in itself, end housing inequality. But it makes every wallet fatter by making every dollar, public and private, go further. Wages buy more. Salaries compete better. Vouchers house more kids. It’s easier for any entrepreneur to turn a great idea into a great job. It’s easier to keep a roof over your head.

Abundance makes every other problem, including inequality, easier to solve.

Most of us know what abundance feels like from other parts of our lives: a grocery store, a streaming-video website, a public library. Abundance lets us enjoy good things without joining a war of all against all. We should be working together to bring the same feeling of abundance to our housing purchases.

Don’t worry, that’ll still leave plenty of other important things to disagree about.

How Franchise Agreements Can Free Cities from Fracked Gas

In the summer of 2019, a handful of cities in California banned developers from adding natural gas installations to new buildings. Soon several more cities, including Seattle, may follow suit. Natural gas, as it turns out, might be even worse for the atmosphere than other fossil fuels like coal and oil, according to experts who study methane leakage along the gas supply chain, from fracking wells to pipelines to end-uses. The bans can prevent worsening one aspect of our entanglement with fossil fuels—burning gas in our buildings. But they do not solve the larger, related problem: we rely on a spiderweb of existing gas infrastructure that ensnares our cities and towns in the gas industry’s clutches, tethering our most benign activities like cooking dinner or taking a shower to distant fracking fields and the many injustices that come with them.

Several rigorous studies of decarbonization show that if the Northwest is to live up to its climate commitments the region’s cities must set an example by phasing out and eventually eliminating gas in both residences and businesses.

One strategy: local governments could modify franchise agreements, which are contracts that govern how private utilities can build and operate their infrastructure in public rights-of-way. These franchise agreements outline rules, rights, and fees associated with the entities using public property for a private reason—and it may be possible to amend them to slow the flow of fossil fuels into our cities.

Most gas utilities in the Northwest are privately owned and operated. Privately owned utilities—like Puget Sound Energy, Cascade Natural Gas, Avista, and NW Natural—are subject to a range of state environmental and consumer regulations. But in many ways, they still act as an arm of the broader gas industry, sometimes playing hardball politics to continue selling fossil fuels. As influential as they may be, they’re still somewhat at the mercy of local governments.

Increasing the costs associated with installing natural gas infrastructure is one mechanism that local governments can use to control utilities. In Washington, state law prohibits cities and towns from levying a franchise fee for use of the public right-of-way, but the law still allows cities and towns to collect a utility sales tax of up to 6 percent. Most collect the full amount in addition to recovering administrative costs associated with the franchise.

Increasing the legally permitted fees and taxes likely isn’t an avenue to raise the cost of natural gas infrastructure enough to slow down the industry’s expansion plans, but there are other components of franchise agreements that could. Franchise agreements contain multiple right-of-way conditions and requirements for working on, permitting and restoring a site upon completion of a project. As these franchise agreements expire and get renegotiated every few years, local governments can introduce new terms.

Here are three possible avenues for cities:

  • Cities could strengthen “restoration” requirements of a franchise agreement so that utilities must repair streets and sidewalks to higher standards than the rough patch-jobs they can currently get away with. Such a requirement would drive up the costs of installing new gas infrastructure and also serve as a boon to drivers, cyclists, and pedestrians.
  • Cities could augment restoration requirements to include paying for damage that gas inflicts on the environment. Even if cities in Washington cannot collect fees from their assessments of environmental damage, they may be able to require gas utilities to buy carbon offsets or fund some form of carbon sequestration or mitigation.
  • Cities could even require utilities to remove their infrastructure after the multi-year agreements expire. Without access to the public right-of-way, utilities would be forced to obtain easements on private land to site their infrastructure, probably at much greater expense.

Finally, state lawmakers can give local governments more power over gas utilities. Simply changing the law so that cities and counties can levy franchise fees would create a valuable tool in the fight against fossil fuels. It could also provide a much-needed source of revenue for cash-strapped communities.

In forthcoming articles, we will take a closer look at the opportunities for key local governments in Washington to use franchise agreements, and we will explore some novel strategies already in development in Oregon.

Laura Feinstein volunteers with Sightline researching energy policy. She spent 11 years in the utility industry, working in energy conservation and engineering.

Eric de Place is Sightline’s Director of Thin Green Line. He is a leading expert on coal, oil, and gas export plans in the Pacific Northwest, particularly on fossil fuel transport issues, including carbon emissions, local pollution, transportation system impacts, rail policy, and economics. For questions or media inquiries about Eric’s work, contact Sightline Communications Manager Anne Christnovich.

Purchase of PRB Coal Mines Puts the Navajo Nation at Risk

It’s official: a federal bankruptcy judge has approved the sale of Cloud Peak Energy’s three Powder River Basin coal mines—Spring Creek in Montana, and the Antelope and Cordero Rojo coal mines in Wyoming—to a company called Navajo Transitional Energy Company (NTEC). A Cloud Peak attorney told the judge that NTEC probably won’t complete the purchase until the end of next week. But from the perspective of the bankruptcy court, the sale is all set to go forward.

To those of us who have watched Cloud Peak’s multi-year descent into insolvency, NTEC’s purchase raises a key question: does the Navajo Nation face any financial risk from NTEC’s foray into the PRB?

The answer is a clear yes: the Navajo Nation faces at least two kinds of financial risks from NTEC’s coal-fired spending spree. First, the Nation risks sub-par investment returns from NTEC’s high-risk gamble on coal. Second, and perhaps more importantly, the Navajo Nation could be forced to pay hundreds of millions of dollars to clean up NTEC’s mines.

Let’s dive in a bit, shall we?

NTEC: NECK DEEP IN COAL

Wholly owned by the Navajo Nation and incorporated under Navajo laws, NTEC is a relative newcomer to the US coal industry. The company was formed in 2013 to purchase the Navajo Mine, the chief supplier of coal to the nearby Four Corners Power Plant, both of which lie within Navajo territory. But declining coal demand has slashed the Navajo Mine’s revenues: in 2009 the mine shipped 8.8 million tons of coal to Four Corners, but that fell to just 3.5 million tons last year.

As the Navajo Mine’s struggles deepened, NTEC tried to branch out into new ventures. And while the company’s charter requires the company to invest at least 10 percent of its income in renewable and alternative energy, NTEC’s management—led by a trio of non-Navajo coal industry veterans, including a CEO who previously headed a failed coal export project in Oregon—focused its ambitions on buying up assets from the faltering US coal sector.

Earlier this year, the company tried—but failed—to buy the Navajo Generating Station, a coal-fired power plant on the western side of Navajo territory. Undeterred, NTEC looked northward towards the Powder River Basin (PRB), the nation’s top coal-producing region. The company’s management apparently viewed the year-long wave of PRB bankruptcies as an opportunity rather than a red flag, and bid on Cloud Peak’s assets in a bankruptcy fire sale. Cloud Peak then coaxed NTEC to raise its bid, and ultimately chose NTEC as the “winner” of its bankruptcy auction.

Yet it was a tainted victory. As coal industry analysts have pointed out, anyone who buys Cloud Peak’s mines will take on significant financial risks. We here at Sightline have documented Cloud Peak’s financial struggles for years, including the tremendous losses on Asian exports, the operational challenges at Cloud Peak’s mines, plummeting demand for Cloud Peak coal, narrowing profit margins, and massive, value-destroying write-downs of the company’s assets. What’s more, NTEC’s purchase comes in the midst of sharply declining coal sales across the country, continued coal plant closures, and a tsunami of coal industry bankruptcies.

There was a reason that Cloud Peak sank into insolvency, and why its massive mines sold for so little: it has become awfully difficult to make money mining coal. And if NTEC’s coal ventures fail, the Navajo Nation faces the prospect of dismal investment returns on the resources it has invested in NTEC.

ON THE HOOK FOR COAL MINE CLEANUP

But bad investment returns could be the least of the Navajo Nation’s worries.  The worst-case scenario is far more troubling: ultimately, the Navajo Nation could face nearly $1 billion in costs for cleaning up after NTEC’s messes.

These financial risks stem, first and foremost, from Federal mining law, which requires coal companies to provide ironclad financial guarantees that they will clean up their mines.

When NTEC proposed to buy the Navajo mine, the newly-formed company didn’t have enough money to provide a rock-solid cleanup guarantee on its own. Instead, NTEC turned to the Navajo Nation to help the company take out so-called surety bonds, which are contracts that obligate a surety company (typically an arm of a big insurance company) to clean up if NTEC can’t.

Surety bonds are sometimes described as a form of insurance, but the comparison misses a crucial fact: a surety company never expects to take a loss on any surety bond. To protect against losses, surety companies always look for deep pockets that can reimburse the company for any losses. In the case of NTEC, the deep pocket was the Navajo Nation itself. The Nation signed special contracts called indemnity agreements with the sureties, committing the Nation to cover up to $463 million worth of NTEC’s liabilities: $163 million to clean up the Navajo Mine, plus an additional $300 million to guarantee steady coal supplies to the Four Corners Power Plant.

Stunningly, these indemnity contracts have no expiration date: they will remain in effect until the liabilities are fully resolved, or the surety bonds are replaced. What’s more, when the Navajo Nation signed the contracts, it granted a limited waiver of Navajo sovereign immunity, meaning that the surety companies can sue the Navajo Nation in state courts, rather than in Navajo courts. Sovereign immunity—the legal doctrine of indigenous self-determination—has been described as “a central axiom of Indian law.” No tribe takes its sovereignty lightly. But NTEC had the Navajo Nation over a barrel: no sovereignty waiver, no surety bond; and without a bond, and the Navajo Mine purchase was dead in the water.

When NTEC tried to buy the Navajo Generating Station, it proposed that the Navajo Nation sign an indemnity agreement similar to the one in place for the Navajo Mine. And to buy Cloud Peak’s mines, it’s likely that NTEC will pull the same maneuver, asking the Navajo Nation to sign additional indemnity agreements and sovereignty waivers that would commit the Nation to pay some $400 million in cleanup and related costs at the Cloud Peak mines.

If the Navajo Nation does sign those agreements, it will officially be on the hook for the costs of cleaning up enormous coal mines in Wyoming and Montana, hundreds of miles away from Navajo territory.

AN EASY WAY OUT

For years to come, NTEC’s cleanup liabilities will hang over the Navajo Nation like a sword of Damocles, poised to do deep damage to the Nation’s financial health. As of the beginning of 2018 the Nation’s Master Trust program—investment funds that help secure the nation’s financial future—held $3.28 billion in assets. So if NTEC goes bankrupt, the financial fallout from the existing Navajo Mine liabilities could effectively wipe out a significant share of the Tribe’s nest-egg.

Adding the Cloud Peak liabilities will just make the financial fallout of an NTEC collapse that much worse, allowing financial contagion to spread southward from the PRB all the way to Navajo territory.

And given NTEC’s plans to double down on coal, there’s a very real possibility that the company will eventually fail. NTEC has touted a slipshod and preposterously rosy “study” that aims to show that the Cloud Peak mines have a bright future. But most reality-based energy analysts expect the coal industry to continue to struggle. Rapidly declining costs for wind, solar, and energy storage will steadily eat into coal’s market share. Cheap fracked gas will keep coal prices low and profits slim. And it’s hard to see how those trends could be reversed. As Kevin Crutchfield, the former CEO of coal giant Contura Energy recently said, the business of selling coal to US power plants “is in a constant state of decline or decay, any way you slice it or dice it.” (Contura itself has paid more than $110 million to coax other companies to buy two massive PRB mines, simply to avoid paying to clean up those mines itself.)

At this point, if the Navajo Nation agrees to take on NTEC’s cleanup liabilities, it will just be adding fuel to a smoldering fire. Yet there’s absolutely no reason why the Navajo Nation must continue to enable NTEC’s questionable business judgment. The Navajo Nation Council could simply reject any indemnity agreements for cleaning up the Cloud Peak mines. Or, a minimum, the Council could refuse to waive its sovereign immunity with respect to the indemnity agreements. Given the dismal state of the US coal industry, the safest move for the Nation is simply to steer clear of any commitments to clean up after the coal industry’s mistakes.

Clark Williams-Derry is the director of energy finance at Sightline. He focuses on US and global and energy markets and his recent research covers the financial and fiscal implications of “self-bonding” for coal mine reclamation; the financial viability of West Coast coal export projects; Pacific Rim coal market dynamics; greenhouse gas accounting for coal export projects; issues emerging from coal industry bankruptcies; and the interactions between federal coal leasing policy and coal exports. To contact Clark or for media requests, contact Sightline Communications Manager Anne Christnovich.

In Mid-Density Zones, Portland Has a Choice: Garages or Low Prices?

For three years, Portland’s proposal to re-legalize fourplexes citywide has been overshadowing another, related reform.

That other reform applies not to low-density lots but to mid-density areas: The ones currently zoned for townhomes and small to medium-size apartment buildings. It’s finally coming before Portland’s city council in a public hearing Wednesday. (The city is also accepting online testimony right now.)

Lots affected by Portland’s “Better Housing by Design” reform to mid-density residential zones. Image courtesy of Portland Bureau of Planning and Sustainability. Map generated by Esri.

This proposed mid-density reform, dubbed “Better Housing by Design,” includes various good ideas, like helping East Portland’s big blocks include shared interior courtyards; regulating buildings by size rather than unit count; and giving nonprofit developers of below-market housing a leg up with size bonuses.

But one detail in this proposal is almost shocking in its clarity. It turns out that there is one simple factor that determines whether these lots are likely to eventually redevelop as:

  1. high-cost townhomes, or as
  2. mixed-income condo buildings for the middle and working class.

The difference between these options is whether they need to provide storage for cars—i.e. parking.

According to calculations from the city’s own contracted analysts, if off-street parking spaces are required in the city’s new “RM2” zone, then the most profitable thing for a landowner to build on one of these properties in inner Portland is 10 townhomes, each valued at $733,000, with an on-site garage.

But if off-street parking isn’t required, then the most profitable thing to build is a 32-unit mixed-income building, including 28 market-rate condos selling for an average of $280,000 and four below-market condos—potentially created in partnership with a community land trust like Portland’s Proud Ground—sold to households making no more than 60 percent of the area’s median income.

This is worth repeating: As long as parking isn’t necessary, the most profitable homes a developer can build on a lot like this in inner Portland would already be within the reach of most Portland households on day one.

But if we require parking on these lots, we block this scenario. If every unit has to come with an on-site garage, the most profitable thing to build becomes, instead, a much more expensive townhome.

When people say cities can choose either housing people or housing cars, this is what they’re talking about. 

I’ve never seen a more clear-cut example.

Fellow nerds: Here are the numbers

Here’s the math, as calculated last year by real-estate economics firm EPS Inc.

First, some necessary jargon: “stacked flats” refers to a series of one-level condos on top of each other, arranged in a building looking something like this:

Image courtesy of Portland Bureau of Planning and Sustainability, used with permission.

“Townhomes” refers to homes attached to each other at the side, looking like this:

Image courtesy of Portland Bureau of Planning and Sustainability, used with permission.

We’re interested in what the analysts referred to as “prototype 4”: a hypothetical 100’x100′ lot (maybe assembled from two or more smaller lots) in the new RM2 zone in an “inner neighborhood” of Portland. EPS ran numbers on a “stacked flats” condo project and a “townhomes” project on this lot. (They considered rental homes, too, but concluded that occupant-owned homes would be a bit more financially feasible in this zone than rental homes.)

First, EPS added up the costs and probable revenues of such projects if they have parking. You can see their estimates in the rightmost column of the table below. (The other columns refer to different regulatory scenarios.)

Check out the number I highlighted. If someone tried to create one parking space for each stacked-flat home on a lot like this, they’d end up having to pour almost three quarters of a million dollars into a 16-car garage:Well, it turns out that constructing a small apartment building with a $720,000 garage is an unprofitable business venture. EPS calculates that this additional expense would sink such projects. The likelier outcome would instead be 10 much more expensive townhomes, which is the project type represented by the tallest bar below:

Then the analysts flipped one switch—the presence of parking—and everything else changed, too.

See the number I highlighted in the revised table below, “AH revenue”? That’s the amount of money the developer would be bringing in, total, from the four “affordable housing” homes under the parking-free scenario 4B.Notice how none of the other scenarios include that figure? That’s because none of the other scenarios here would create any below-market housing. This project would.

The parking-free stacked flats scenario (4B) still includes market-rate homes too: 28 of them in this case. But if you look at the number immediately above the one I’ve highlighted, you’ll see the developer would be bringing in about $7.8 million total from those homes—an average of $280,000 each.

With 20 percent down and a mortgage interest rate of 3.9 percent, that comes out to a monthly payment of $1,390, including taxes and insurance, for a small, newly built home in inner Portland.

And—I’m just going to point this out a third time—this building full of middle- and working-class homes would be the most profitable thing someone could build on this land, as shown by the rightmost bar below:That’s a lot of charts and figures.

But for the people who would live in these homes, having a stable home they could afford in central Portland would be an extremely concrete blessing in their lives. Even if it means parking their car, if they have one, on the street.

Many projects will include parking, but that doesn’t mean the city should require it

The bad news is that it’s far from certain that many developers—or, more to the point, the banks that issue developers’ construction loans—would actually choose to build 32-unit buildings without off-street parking. It just isn’t easy enough yet to get around Portland without a car.

If banks decide they simply have to have off-street parking in order to sell these homes, goodbye stacked flats; hello townhomes. Goodbye, affordable community land trust homes. Goodbye, market-rate homes for the middle class.

That’s depressing, and it’s one of the many reasons cities should be investing heavily in making low-car life possible for more people.

But Portland is currently proposing something downright foolish: It wants to keep requiring garages on some of these lots. The mandate would apply to any lots that are more than 10,000 square feet, more than 500 feet from a frequent-service bus stop, and more than 1,500 feet from a rail stop.

As the numbers above show, the city may as well be banning affordable housing on many lots that don’t meet that standard, including lots that may be zoned “RM2” in the future. And every lot where the city requires parking shuts the door to future entrepreneurs who might come up with creative ways to help people avoid car ownership.

More broadly, there’s an issue of principle here that could apply in any city: Mandating off-street parking, even when we’re fully aware that it makes more and cheaper homes impossible, requires a judgment that housing cars is more important than housing people.

Nowhere in Portland—nowhere on the planet—is that true.

Take it from Portland’s mayor, Ted Wheeler, who said the following a few months after coming to office:

“I want to put a marker down. The debate: Parking vs. Housing? It’s really over. That piece of the conversation is over. When younger families or younger people say they want to locate here, the first thing they’re saying isn’t ‘Boy I wish I had another parking space, or had access to a parking space.’ What they’re saying is, ‘I can’t afford to live in this city.’ And, so, the city, meaning the debate that happened over the last three years actually made a choice, and the choice was affordability and housing over access to parking. I just want you to be aware that that is a real dynamic and is a real choice and it was made with full community involvement.”

I don’t always agree with Mayor Wheeler. But I can’t disagree with any of that.

Should Northwest Cities Ban Fracked Gas in New Buildings?

There’s little debate that the global climate cannot afford to keep burning fossil fuels for decades to come. Yet even in North America’s most climate-enlightened precincts, there’s a ferocious debate about how to stop making the problem worse. Witness Seattle, where city councilmember Mike O’Brien recently attempted to outlaw gas installations in new buildings (except restaurants). He was met with a flood of opposition so overwhelming that the bill is now tabled until December 2019, at the earliest.

A few cities in California have moved ahead. Berkeley, San Jose, Menlo Park, and Santa Monica have all enacted prohibitions of various kinds to prevent developers from installing gas infrastructure in new buildings. Santa Rosa may be among those that go next and there are a handful of places in Massachusetts—including Cambridge, Brookline, and Lexington—considering the same move. So far none have developed laws to reduce or phase out existing gas infrastructure.

These cities could be the start of something, but their actions can be contrasted starkly to larger trends in the gas industry. Despite clear evidence that modern-day natural gas is no better for the atmosphere than coal or oil, the industry is expanding almost everywhere, building out new infrastructure designed to operate for 30 years, a half-century, or even longer. Despite recent financial setbacks, the industry is still racing ahead in big fracking and petrochemical regions like Appalachia, the Gulf Coast, and northwest Canada.

The Pacific Northwest is hardly better. In 2017, the most recent year for which complete data are available, the region used record amounts of gas and residential gas consumption has been steadily growing for decades. The industry forecasts even more growth this year—and it’s only just begun. In Washington, policymakers are still torn about allowing big expansions for the gas industry, including a new pipeline in Snohomish County, a new LNG facility in Tacoma, and a giant gas-to-methanol project in Kalama. In Oregon, officials are considering permitting an LNG export terminal in Coos Bay that would be the single-biggest carbon polluter in the state.

All of it hastens the Northwest toward a serious jam: we know we can’t continue using fossil fuels for much longer, but we’re still letting carbon entangle our economy in ways that make it more difficult to break free. It’s like we’re standing in the checkout line ready to buy a case of beer and a box of donuts while vowing to eat healthier.

A ban on gas in new buildings is a commonsense first step that applies to any chronic problem: you stop making it worse. Plus, as Justin Gillis and Bruce Nilles pointed out in a recent op-ed in the New York Times, there’s no reason we still need to burn gas in our homes. Excellent new technologies like heat pumps and induction stoves are not only cleaner, healthier, and more efficient, but they’re more affordable to operate. The principal barrier to phasing out gas now is not technical but political. It’s the gas industry, including the utilities that profit from selling gas, and some building trade groups.

Still, the bans don’t go far enough. They leave untouched the bigger problem of existing fossil fuel use: what do we do about all the gas infrastructure that’s already installed and operating? Under the streets of every major city in the Northwest (and across North America), you can find a dense spiderweb of gas lines that connect our homes and businesses and shops to faraway fracking wells. Untangling that relationship will be trickier than a simple ban and it will require subtler strategies. In a follow-up article, I will explore a hidden strategy that local governments can use to rid themselves of gas over time, starting with “franchise agreements,” the in-the-weeds contract agreements that govern the way utilities can operate in our cities and towns.

Eric de Place is Sightline’s Director of Thin Green Line. He is a leading expert on coal, oil, and gas export plans in the Pacific Northwest, particularly on fossil fuel transport issues, including carbon emissions, local pollution, transportation system impacts, rail policy, and economics. For questions or media inquiries about Eric’s work, contact Sightline Communications Manager Anne Christnovich.

This Clause in the US Constitution Is Being Wielded to Attack Climate Change Policies

Earlier this year, Washington Governor Jay Inslee signed legislation requiring that oil transported by rail to refineries in the state must meet a reduced “vapor pressure” threshold, the measure of a liquid’s volatility. The law is designed to address a history of oil trains catastrophically catching fire after derailing, including one explosive incident in a small town in Quebec that killed dozens of residents.

North Dakota has been a vocal opponent of Washington’s legislation. Approximately 10 percent of the state’s oil travels daily to Washington’s refineries by rail, primarily from its Bakken formation, and Bakken oil is known to be extremely volatile, described in a report by the Canadian government as more closely resembling gasoline. Not surprisingly, its vapor pressure often exceeds Washington’s new safety standard.

Although the new law is limited in scope—it only applies to new refineries and existing refineries that increase their output above 2018 levels—North Dakota is considering filing a lawsuit based, at least in part, on the Interstate Commerce Clause of the US Constitution, specifically what is known as the “Dormant Commerce Clause.”

This backgrounder explains the origins of the Dormant Commerce Clause and the legal principles guiding its use and then assesses how Washington’s oil train legislation might fare if North Dakota eventually does bring its lawsuit.

What exactly does the Constitution’s Dormant Commerce Clause say?

Trick question! There is no Dormant Commerce Clause in the Constitution. That’s how dormant it is. There is, however, a Commerce Clause that gives Congress the power to regulate commerce “among the several States.”

The “dormant” part arises from the implication that only Congress shall have this power, meaning that states themselves are prohibited from regulating commerce among the states.

Why would the framers of the Constitution want to restrict a state’s authority to regulate commerce (as in, goods and services) within its borders?

In a word, protectionism. Courts have interpreted the Commerce Clause to prohibit a state from favoring its own industries by burdening products that originate elsewhere. The intent is to prevent the “economic Balkanization” that plagued the colonies and early states.

As colorfully observed by a politician at the time:

The king of New York levied imposts upon New Jersey and Connecticut, and the nobles of Virginia bore with impatience their tributary dependence upon Baltimore and Philadelphia. Our discontents were fermenting into civil war.

Instead of civil war, however, frustration with the local taxes imposed on interstate trade helped propel the Constitutional Convention of 1787.

Which means that today, Washington State cannot mandate that all apples entering the state are subject to a 25-cent border tax. That’s anticompetitive and discriminatory (in the commercial sense), a blatant attempt to promote Washington apple growers by raising the price on imports.

For the most part, states retain authority to even-handedly regulate goods and services for legitimate reasons, which is why Washington is free to do things such as ban harmful chemicals produced in other states and require certain professions, such as lawyers and teachers, to meet state-specific licensing requirements.

It’s true that, without those limits, products and services from other states would be more accessible, but the Dormant Commerce Clause is not intended to curtail everything a state does that has an effect on interstate commerce.

In the face of Dormant Commerce Clause challenges, courts have interpreted the Constitution to allow jurisdictions to ban puppy mills, mandate pharmaceutical take-back programs, and prohibit imports that could carry parasites and invasive pests. Again, the aim here is primarily to prevent states from promoting its own economic interests by “discriminating” against the competition.

Washington wants to protect its citizens from hazardous rail cargo, not protect in-state oil producers (of which there are none). So, no problem, right?

Not so fast. Even if the local industry doesn’t benefit from a measure, courts will also consider whether a state has placed an “undue burden” on commerce from other states.

To do that, judges will look at the extent to which a challenged measure interferes with the free flow of commerce balanced against any benefits to the public, such as promoting residents’ health and safety or protecting the environment. This is known as the “Pike” balancing test, named for the legal decision where it first appeared.

Could a court strike down Washington’s safety standards under the Pike balancing test?

In general, the law around the Dormant Commerce Clause is notoriously murky, but courts typically are reluctant to use the balancing test to nullify state and local measures. The burdens must be “clearly excessive” when weighed against the benefits, and judges tend to avoid second-guessing conclusions about health and safety benefits.

In practice, this means that courts only seem interested in striking down policies that have no real benefit, as in a case where Wisconsin failed to provide any evidence of improved public safety to support a regulation requiring that extra-long tractor-trailers have a special permit to use its highways.

Applying the balancing test, courts have rejected Dormant Commerce Clause challenges to arguably more stringent climate measures, including limits on fossil fuel terminals in Portland, Oregon and a prohibition on oil transfers in South Portland, Maine.

Why then would North Dakota even consider bringing a lawsuit based on the Dormant Commerce Clause?

For one thing, it’s an ongoing trend. In recent years, the Dormant Commerce Clause has been the go-to legal claim for fossil fuel interests opposing measures to combat climate change. In fact, in a case that is still being litigated, companies backing the Millennium Bulk coal export terminal on the Columbia River brought a lawsuit based on the Dormant Commerce Clause to challenge Washington’s denial of a critical permit.

Also, lately North Dakota has been touting a study from the US Department of Energy, concluding that vapor pressure does not correlate to the severity of an oil fire. If North Dakota calculates that it could use the study to undercut the asserted benefits of Washington’s law, that could strengthen a claim that the balancing test favors striking down the vapor pressure limits.

Regardless, the Dormant Commerce Clause will likely continue to make its periodic appearances in litigation attacking new climate policies. The federal government’s unrelenting hostility to climate protections has prompted states and localities to try to fill the gap, and oil and gas interests—including those in the White House—will no doubt push back in the courts however they can.

Michael Mayer practiced environmental law in the Northwest for close to a decade and now teaches climate change law at Seattle University School of Law.

 

The Role of Community Land Trusts in Cascadia’s Quest for Affordable Housing

The housing crisis that plagues most major cities always puts renters on the losing side as they face increasing housing instability. Rising rents and affordable housing shortages are pushing lower-income residents out of their neighborhoods in favor of the rich. One of the biggest housing policy challenges in growing cities is how to invest in low-income communities—provide walkable, amenity-rich neighborhoods with abundant and affordable housing, without displacing vulnerable residents. The preferred answer of residents and advocates has long been clear: ownership!

Unlike renters who are stuck paying whatever hike the market demands, people who own their homes can benefit from local investment.


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Unlike renters who are stuck paying whatever hike the market demands, people who own their homes can benefit from local investment. As families throughout Cascadia feel the pinch of rising housing costs, more cities of all sizes are turning to the Community Land Trust (CLT) model to extend ownership opportunities across the income spectrum.

As housing advocates have long argued, CLTs halt displacement in its tracks in two main ways: they help low-income renters become owners, and they ensure permanent affordability by limiting the price at each resale. [Some CLTs also provide affordable rentals for very low-income people who can’t acquire a mortgage.] For communities under threat of displacement, CLTs can turn around a family’s fate by providing not only stable, affordable housing, but also an opportunity for wealth-building otherwise out of reach.

CLTs first cropped up in Cascadia 30 years ago, and today the region holds around 2,361 CLT homes run by 18 different CLT organizations in urban and rural communities. Nine new Cascadian CLTs are also in the works.

The region’s operating CLTs demonstrate their viability as an equitable housing solution and their potential to serve more communities. But CLTs provide a small number of homes within Cascadia, only 0.03 percent of total housing stock, which is understandable because scaling up CLT housing would require vast public investments. In Washington state, for example, the state allocated only 2.5 percent of Housing Trust Fund dollars to CLTs in 2017.

This lack of funding is the same roadblock that precludes cities from even coming close to meeting the need for other types of subsidized housing, too. On top of the cost to build homes, CLTs looking for land to take out of the private market are up against the gargantuan economic scale of real estate capitalism. Raising the share of CLT homes in a major Cascadian city to say, 10 percent, would necessitate spending billions of dollars on land alone.

In this article I present a survey of CLTs across Cascadia that testifies to the trailblazing work already accomplished and the promise of CLTs to bring stability to more Cascadians. In a follow-up I’ll explore the barriers to scaling up CLTs and solutions for overcoming them.

What is a CLT?

CLTs are non-profit corporations that acquire land and develop housing, which they sell at below-market rates. CLTs typically serve low- to moderate-income households earning 50 to 80 percent of the area median income (AMI). Some CLTs also provide affordable rentals, typically serving low-income households. In Cascadia, most CLTs offer ownership and rental homes.

For ownership, the CLT owns the land and the resident owns the home, with use of the land granted through a 99-year ground lease. CLTs restrict the price at each sale using a variety of formulas, such as fixed-rate, appraisal based, or AMI based. These caps typically limit appreciation to 1.5-2 percent annually. In most cases, owners acquire less equity over time than would the owner of an unrestricted home.

Critics argue that because CLTs limit the accrual of equity, they create a “second-class” of homeowners, compared with owners of market-value homes. But for those who cannot access the traditional housing market, ownership with less equity is better than no ownership at all. The equity built in a CLT home can sometimes help CLT owners to purchase a home on the open market. For example, according to representatives of Proud Ground CLT in Oregon, of the 15% of homeowners who sell their home, 54% of their homeowners go on to purchase their own home.

Compared with standard subsidized rentals, CLTs can offer greater permanence, using a one-time subsidy to preserve long-term affordability. By perpetually restricting resale of the home, the CLT preserves the initial subsidy over time. In contrast, subsidized rental projects often require ongoing funding to cover operating expenses, and many can also be at risk of market-rate conversion when federal tax credits expire.

The birth and growth of CLTs

In 1969, a group of Black farmers and civil rights activists in Albany, Georgia, founded New Communities Inc., which was the first CLT in the United States or Canada. They created it to help Black farmers facing threats of eviction due to their participation in the civil rights movement. From its inception, the CLT’s mission was to help Black residents stay rooted in their communities and protect against displacement.

Today, depending on who’s counting, there are somewhere between 225 and 300 CLTs nationwide in the United States, the largest being the Champlain Housing Trust in Vermont with 2,765 homes. American CLTs are predominantly concentrated in the Northeast, but Cascadia has a growing CLT network dating to the late 1980s.

Most CLTs begin through community-focused or affiliated groups such as neighborhood associations, community organizers, community development corporations (CDCs), or religious coalitions. When starting a CLT, organizers typically seek buy-in from the low-income community the CLT would serve, and support from government agencies, nonprofit organizations, housing industry advisors, local businesses, and banks. To move from idea to reality, CLTs must raise funds for land acquisition, development, and operations.

Under the classic model, a CLT is governed by its members, which can include current and future residents, community members, and general representatives (public officials, local funders, local housing/social service providers, etc.). The members elect a governing board, which usually includes a balanced representation of CLT residents, community members, and general representatives, giving all stakeholders a voice in determining the CLT’s future.

CLTs in Cascadia

Sightline defines Cascadia as encompassing Washington, British Columbia, Idaho, and Oregon, as well as small parts of Montana and California, and southern Alaska. Similar to much of North America, many communities across Cascadia are facing a housing crisis. Nationally, 47 percent of renters are cost-burdened, spending over 30 percent on housing costs. Some 46 percent of renters in Washington  spend 30 percent or more of their income on housing, as do 49 percent in Oregon, and 42 percent in both Idaho and British Columbia. Among renter households earning less than $50,000 per year, 77 percent spend 30 percent or more of their income on housing in Washington, as do 76 percent in Oregon, 65 percent in Idaho, and 71 percent in British Columbia.

For the past three decades, Cascadian CLTs have been safeguarding residents against rising home prices. The region’s first was the Lopez CLT, founded in 1989 on Lopez Island in northwest Washington, and currently has 48 homes.

Today, CLTs provide an estimated 2,361 affordable homes in Washington, Oregon, Idaho, and British Columbia. These homes are a promising achievement, but they represent just 0.03 percent of the region’s 7.5 million homes, which does not address the need for permanently affordable housing.

Cascadia’s largest CLTs are located in its three largest cities: Seattle, Vancouver, and Portland. Seattle’s Homestead Community Land Trust, Portland’s Proud Ground Community Land Trust, and Vancouver Community Land Trust make up 64 percent of the region’s CLT homes. Homestead operates 215 homes and Proud Ground operates 280.

Vancouver’s Community Land Trust, by far the largest in the region, has 1,000 CLT homes and plans to construct 1,700 more—a production rate far outpacing other CLTs in Cascadia. That past success and high rate of future growth arose from unique local circumstances: a strong partnership with the city, a history of co-op conversion to CLTs, leased city-owned land on which to build, and a large, established, quasi-governmental organization capable of building and managing a big stock of CLT homes.

In terms of the number of CLT organizations, Washington currently leads the Cascadian pack with 17. Idaho has two CLTs; Oregon, three; and British Columbia, four. CLT capacity and pricing varies by location. In general, compared with rural CLTs, urban CLTs tend to have more units and higher prices that reflect more expensive local housing markets.

See the table below for a rundown of all of Cascadia’s CLTs:

Name of CLT
Est. number of homes
Location
Community Land Trust Foundation 1,000 Vancouver, British Columbia
Proud Ground 280 Clackamas, Clark, Lincoln, Multnomah, and Washington counties in Oregon and Washington
Homestead CLT 215 King County in Washington
Kulshan CLT 138 Bellingham, Washington
OPAL CLT 135 Orcas Island, Washington
Housing Resources Bainbridge 131 Bainbridge Island, Washington
Vashon Household 114 Vashon Island, Washington
Vernon & District CLT 81 Vernon, British Columbia
Home Trust of Skagit 58 Skagit County in Washington
Lopez CLT 48 Lopez Island, Washington
San Juan Community Home Trust 37 San Juan Island, Washington
NeighborWorks Umpqua CDC 30 Ashland, Oregon
Arch Community Housing Trust 26 Blaine County in Idaho
Salt Spring Community Housing & Land Trust 24 Salt Spring Island, British Columbia
SHARE CLT 20 Leavenworth, Washington
Sabin CDC 14 Portland, Oregon
Homeward Bound 5 Clallam and Jefferson counties in Washington
Methow Housing Trust 5 Mazama, Winthrop, and Twisp, Washington
Total 2,361

There are also 9 Cascadian CLTs that do not have homes yet: Africatown CLT (WA), Chelan Valley Housing Trust (WA), Hogan’s Alley Land Trust (BC), Homes and Hope CLT (WA), Kor CLT (OR), Moscow Affordable Housing Trust (ID), Spokane CLT (WA), Thurston County Land Trust (WA), and Waldron CLT (WA).

CLTs have inspired other housing providers, like Habitat for Humanity, to use the CLT ground lease and affordability requirements to provide permanently affordable housing. For example, Habitat’s King County chapter provides over 160 permanently affordable homes. Other Habitat chapters in Washington, Oregon, and Idaho work in partnership with CLTs or established their own land trusts, which don’t typically operate under the classic CLT model.

How do CLTs operate in Cascadia?

Kulshan CLT homes are typically $50,000 to $100,000 less than the price of market-rate homes in Bellingham, and two of its rentals serve households with incomes 50 percent below AMI. OPAL CLT serves low-income residents on Orcas Island located in San Juan County, an area with Washington’s highest affordability gap. Homestead alone accounts for nearly a quarter of CLT homes in Washington, and a majority of its homeowners are people of color.

Following in the tradition of the New Communities CLT in Georgia, Sabin CDC in Portland, Africatown CLT in Seattle, and Hogan’s Alley Land Trust in Vancouver aim to restore the historically Black neighborhoods in Northeast Portland, the Central District in Seattle, and Hogan’s Alley in Vancouver. As all three cities become increasingly expensive and exclusive, these efforts will help ensure that Black residents, business owners, and communities across the African diaspora can maintain roots in their neighborhoods.

Since 1991, Sabin CDC has provided affordable housing across Northeast Portland, where the city’s historically Black neighborhoods are concentrated. The CDC includes a land trust, the first in Portland, which provides 14 homes and a majority of their homeowners are people of color. Africatown CLT in Seattle has started design work on its first project, a mixed-use apartment building called Africatown Plaza*, which will provide 134 homes renting at 60 percent AMI or below. Hogan’s Alley Land Trust is negotiating with the city of Vancouver to develop up to 550 rental homes on city-owned land in Hogan’s Alley that will be vacated after the city removes the Georgia Viaduct that runs through Hogan’s Alley, which displaced the historic heart of the Black community and parts of Chinatown in the late sixties.

Through its Hub and Spoke program, Proud Ground expanded from its initial focus on Portland to communities across Clackamas, Clark, Lincoln, Multnomah, and Washington counties. The program creates partnerships with non-profit housing providers to assist them in developing CLT homes of their own. The Hub and Spoke program has 208 units in the pipeline, 158 of which will become part of Proud Ground’s portfolio, with the rest going to non-profit partners.

CLTs first came to Canada in the late 1970s and early 1980s, utilized as a way to preserve the affordability of housing co-ops, in which the federal and provincial governments heavily invested during the urban renewal period in the sixties. The CHFBC’s 1,000 CLT homes differ from the most common CLT model in two ways: First, they are strictly multifamily apartments and townhomes—not detached houses. Second, residents hold ownership through a co-op arrangement, which means they share ownership of the entire multifamily building, not just the unit they live in.

The high production rate is largely the result of a partnership with the city of Vancouver. Beginning in 1993, the CHFBC’s CLT operated co-ops on lands owned by the BC government, which later transferred ownership to the CLT. In 2012, the city of Vancouver partnered with the CHFBC to produce 358 new affordable homes on city surplus land. Building on that momentum, CHFBC’s CLT has acquired 275 more homes since 2012, along with the 1,700 in the pipeline.

What will it take to scale up CLTs?

Homestead townhomes. Photo by Nisma Gabobe, used with permission.

CLTs have fostered community-controlled affordable housing in select Cascadian communities. Today, the region’s 18 operating CLTs and 2,361 homes demonstrate that they can be a viable way to deliver housing security for low-income people. Their numbers are large compared with where they started 30 years ago, but they remain a fraction of one percent of Cascadia’s dwellings. Why don’t we see more of them?  

The main barrier is lack of funding. In a follow-up to this article, I’ll examine funding barriers and suggest solutions for boosting the production of CLT homes. 

Note:

*Africatown CLT previously partnered with Capitol Hill Housing to convert the Liberty Bank building into affordable housing. The Liberty Bank Building is owned by Capitol Hill Housing as the developer, and after a 15 year tax credit compliance building, Africatown Community Land Trust and Byrd Barr Place have a right of first refusal to own the building. 

Update, Sept. 27: This article has been updated to include data from Sabin Community Development Corporation’s CLT stock.

Update, Sept. 30: This article has been updated to include information about Habitat for Humanity’s land trust homes.

Acknowledgements: Thanks to Kathleen Hosfeld with Homestead Community Land Trust for providing key insights on CLT practices and initial data on CLTs in Washington and Oregon. Thanks to Jackie Keogh at Proud Ground, Brian Shelton-Kelley at NeighborWorks Umpqua Community Development Corporation, Stephanie Allen at Hogan’s Alley Land Trust, Tamara White at Community Land Trust in Vancouver, Michelle Griffith at Arch Community Housing Trust, Nils Peterson at Moscow Affordable Housing Trust, Kendra Meyer at Kulshan Community Land Trust, and Loulie Brown at Sabin CDC  for sharing their CLT expertise and providing information about their organizations. Thanks to Jenee Gaynor and Vince Wang at Grounded Solutions Network for their insights into the national and regional CLT movements.

Silicon Smelter Project Represents Big Questions for PNW Leaders

In a sleepy rural corner of Washington, one of the region’s most intriguing debates over modern energy development is playing out. Tucked up against Idaho’s panhandle, some 13,000 residents of Pend Oreille County are grappling with a $325 million proposal to build a polluting industrial smelter that would manufacture silicon metal from ore for solar panels and electronics.

It is a political, social, and environmental lightning rod. Supporters say the smelter would create much-needed employment and contribute to the state’s renewable energy industry, while opponents decry the development as corrupt, polluting, and a violation of tribal rights.

There’s also a grim irony that the smelter proposal surfaces. The much-heralded clean energy economy of solar energy, computer circuitry, and electronics is only possible because of industrial practices that are the polar opposite. Mining and smelting to make the silicon metal used in smartphones, computers, and, most prominently, solar panels require massive amounts of energy and natural resources, and emit large quantities of air pollution. When fully operational, the smelter proposed for northeast Washington would use raw materials to the tune of hundreds of thousands of tons each day—trucks delivering wood chips from sawmills; trains loaded with Canadian silica and Kentucky coal; then there are the 105 megawatts of power from hydroelectric dams in the region. The facility would be among the biggest emitters in the state of carbon, sulfur, and other air pollutants.

The outcome of the project is unclear, but it highlights a balancing act that Northwest leaders can learn much from. The residents of Pend Oreille County are confronting some of the hardest questions about our changing energy economy.

Squarely at the center of the dispute is the Kalispel Tribe of Indians. It is impossible to understand the tribe’s opposition to the smelting project without understanding something about the tribe’s history. The Kalispel once made their home across a broad swath of the territory in what is today northeast Washington, northern Idaho, and northwest Montana. In 1855, one group, the Upper Kalispel, ceded land in exchange for space on a reservation near Flathead Lake, Montana. The other group, the Lower Kalispel, was not included in any legal US government protection until 1914 when a small reservation was established by President Woodrow Wilson in Pend Oreille County. During those years and in the decades that followed, however, the Kalispel’s livelihood and cultural resources were severely degraded by a range of activities. Homesteaders took land outright. Loggers felled the forests. Mills and other operations polluted the streams and poisoned the fish. Then electric utilities dammed the rivers, wiping out a complex ecology that decimated many staple food sources.

Today, the Kalispel see themselves on the front lines of climate change. The Reservation is located just 10 miles downwind from the planned smelter site. The community has already been subjected to severe wildfire smoke in recent summers, which may be due in part to climate change, and the Tribe is loath to allow further degradation of its natural resources. Leaders point out that the project’s backers and government agencies alike have failed to engage the Tribe in consultation, which is legally required.

Native opposition to the project appears to be growing. The Affiliated Tribes of Northwest Indians, the major regional consortium of tribes, raised concerns in early 2018 about the project and published a joint statement calling to halt the permitting process and apply greater scrutiny. Then on August 1, 2019, the organization issued a new resolution opposing the project on the grounds that it would emit large amounts of greenhouse gases and sulfur. The month before that, the Kalispel Tribe persuaded the US Environmental Protection Agency to give the reservation the highest level of protection under the US Clean Air Act, which requires stricter standards for industrial polluters. That designation alone may be enough to prevent the project from getting built near the Kalispel Tribe, but the project backers have not withdrawn their application.

Joining the tribes in opposition are a group of Spokane faith leaders, as well as a regional organization of health professionals, and the State Democratic Party. Meanwhile, statewide environmental groups have mostly stayed on the sidelines of the debate, either unaware of the project or unwilling to take sides.

Backers of the project have touted that the smelter might someday supply silicon metal to REC Silicon in Moses Lake, Washington, for made-in-the-Northwest solar panels, surely one of the region’s clean energy success stories. But REC is struggling, mired in trade disputes with China. Now running at just a quarter of its capacity, the firm already laid off 40 percent of its workers and may close its doors altogether. Officials behind the Pend Oreille smelter now claim that REC Silicon would only represent 5 percent of the smelter’s market and that Washington’s silicon metal would go elsewhere.

Before the smelter can be built, the Washington Department of Ecology must produce a full environmental impact statement (EIS). The agency  planned to publish a draft assessment for public comment in autumn 2019 and aimed to publish a final version before the year is out, but opponents are already crying foul over the remarkably limited information so far available, pointing out that the project was first proposed in 2016 and that backers have already had ample time to describe their plans in detail.

Lack of information will make it challenging for the public to provide meaningful critique during the short review period after the draft EIS is published—if it is ever published. Plans for the smelter are way behind schedule and the EIS process appears to be stalled amid widespread rumors that its backers are likely to scrap the project altogether.

Making matters worse, the project’s development is mired in an unresolved and contentious dispute over sale of public land for the benefit of the smelter that has roiled the small county. And opponents charge that an economic development grant for the project from the State Department of Commerce was illegal. Perhaps there’s one thing that’s clear: the proposal has opened up bitter divides in the community and ground local politics to a halt. Meanwhile, Pend Oreille County struggles with serious economic and social issues, including high levels of opioid addiction, a weak labor market, and an uncertain future for the county’s largest employer, a newsprint manufacturer.

While there is no way to know whether the project will ultimately be built, the questions are relevant far beyond Pend Oreille County. How should the region balance industrial manufacturing with environmental impacts? How should we weigh tradeoffs between energy projects and impacts on frontline communities? And how can governments honor tribal rights without directly consulting with the tribes themselves?  And who gets to say?

Thanks to Ahren Stroming who co-authored and researched a previous article on the silicon smelter. That article referred to the project backer as Hi-Test, which was consistent with widespread usage up until the company’s rebranding of its smelter-development arm as PacWest Silicon.

Eric de Place is Sightline’s Director of Thin Green Line. He is a leading expert on coal, oil, and gas export plans in the Pacific Northwest, particularly on fossil fuel transport issues, including carbon emissions, local pollution, transportation system impacts, rail policy, and economics. For questions or media inquiries about Eric’s work, contact Sightline Communications Manager Anne Christnovich.