Like many cities across the nation, Olympia, Washington is facing a shortage of affordable housing for low- and moderate-income families. The city council is currently trying to figure out how much money it can extort from developers before it kills the golden goose. Of course, the city council isn’t wording it quite that way.
In an effort to raise money for the city’s affordable housing schemes, council members have been considering different fees that they can impose on developers in exchange for permission to proceed with a project. One developer recently “contributed” $250,000 to the city in exchange for permission to build a new housing project. Council members wonder how much more they could have gotten. One council member said, “That’s one of those things, it’s like how much could we have asked for before they said no and walked away.” She later added that council needs to figure out “what the market will bear.”
The council member realizes that developers are providing the golden eggs. She just isn’t sure how many eggs she can demand before she kills the goose. But apparently she is going to try to find out.
If a developer offered a council member money in exchange for a favorable vote on a project, he would be charged with bribery. But when the council demands money in exchange for a favorable vote, it is called a “contribution” or an “impact fee.” So long as developers pay extortion money, city councils will increase their demands.
Developers could quickly put an end to this racket. All they have to do is announce that they won’t pay one penny in fees or contributions in exchange for permission to build new housing. All they need to do is say that any demand for extortion will kill the goose.
So long as developers pay city governments for permission to build new housing, the developers will be sanctioning their own demise. As Leonard Peikoff has said, “The ‘sanction of the victim’ is the willingness of the good to suffer at the hands of the evil, to accept the role of sacrificial victim for the ‘sin’ of creating values.” Until developers stand up for themselves, they will continue to pay for the “sin” of creating the housing the nation desperately needs.