# A City at a Crossroads: Bellingham Tackles Parking, Housing, and the Question of Market Wisdom The cold December afternoon carried both the weight of winter and the urgency of a housing crisis as Bellingham's City Council convened as a Committee of the Whole on December 16, 2024. Council President Pro Tempore Hollie Huthman called the meeting to order at 1:16 PM, stepping in to chair as Council President Dan Hamill attended virtually from home, battling illness. What unfolded over the next several hours was a masterclass in municipal complexity—a debate about parking minimums that revealed fundamental questions about how cities should grow, who they should serve, and whether markets can be trusted to deliver public good. ## Meeting Overview The afternoon's agenda carried three substantial items, but it was the first—an interim ordinance eliminating parking minimums citywide—that would dominate discussion and reveal the philosophical fractures within the council. Present were Council Members Hannah Stone, Hollie Huthman, Edwin "Skip" Williams, Lisa Anderson, Michael Lilliquist, and Jace Cotton, with President Hamill joining remotely. The meeting would stretch well past its anticipated conclusion, reflecting the depth of consideration such consequential policy deserves. The backdrop was inescapable: Bellingham faces a profound housing shortage. As Planning Director Blake Lyon would note in his presentation, the city permitted only 516 housing units through November 2024, far below the estimated 825 units needed annually. Against this crisis, Mayor Kim Lund had issued Executive Order 2024-02 in November, calling for administrative and legislative actions to expand housing options. The parking ordinance before council was the legislative centerpiece of that order. ## The Case for Simplicity: Director Lyon's Complex Argument Planning and Community Development Director Blake Lyon opened with an unusual approach—not diving immediately into technical details, but wrestling with philosophical questions about governance itself. Drawing from the urban planning organization Strong Towns, Lyon distinguished between complicated systems and complex ones, arguing that Bellingham's current parking regulations had become counterproductively complicated. He held up two documents that told the story in stark visual terms: the city's original 1947 zoning ordinance, a mere 15 pages, and today's parking regulations, which would require a three-ring binder. "We have made that complicated," Lyon said. "We have attributed parking ratios based on national standards and other components that imply this level of preciseness and accuracy that isn't really reflected in the day-to-day society." The current system, Lyon explained, was built in 1969 and largely remains intact—a set of rules developed in a different era for different needs. "We're so detached from where that was that it's underserving us as a community," he argued, pointing to rising housing costs, environmental degradation, and inequity as consequences. Lyon's presentation then took a deeply personal turn, sharing a quote from a recent training that had resonated with him: "What you want to happen has to be greater than what you fear may happen." This became the emotional core of his argument—that the opportunity to create more housing and greater equity must outweigh concerns about unintended consequences. The nationwide context, Lyon noted, supports bold action: America has six parking spaces per vehicle, an overabundance that suggests removing requirements wouldn't create shortages. He encouraged skeptics to review Mayor Lund's executive order, which contains "over three pages of whereases...each one as compelling as the next." ## The Mechanics of Change The proposed interim ordinance would eliminate minimum parking requirements citywide for all land uses—residential, commercial, and industrial. When developers choose to provide parking, existing design standards would still apply, but the baseline requirement would be zero. The ordinance includes important exceptions and requirements: - ADA parking would still be required for most new construction - Projects built under the International Residential Code (single and two-family homes) would be exempt from ADA requirements - Developments with six or fewer units in a single building would be exempt - Buildings constructed before January 31, 2025, would be exempt from new ADA requirements if converted to additional residential units Lyon emphasized this wasn't about prohibiting parking but allowing "the market to determine the appropriate amount needed on a case-by-case basis." Research from Spokane, which adopted similar reforms about a year ago, showed that in all but two instances, developers still provided some parking—they simply provided amounts appropriate to local conditions rather than amounts mandated by decades-old formulas. The ordinance also includes comprehensive bicycle parking standards, recognizing that reducing car dependency requires supporting alternative transportation modes. These standards vary by use type and distinguish between short-term parking (for shoppers and visitors) and long-term parking (for employees and residents). ## The Economics of Housing and Equity Lyon's most detailed analysis focused on how parking requirements interact with housing affordability—a complex relationship that challenges simple supply-and-demand thinking. Using area median income (AMI) as a framework, he illustrated how parking reform could benefit different income segments. For context, 100% AMI in Whatcom County equals about $106,000 annually for a household of four. Housing below 80% AMI typically requires subsidies—what Lyon called "capital A affordable housing." The city currently invests about $15 million annually in this segment. At the other extreme, households above 150% AMI can afford market-rate housing without assistance. The challenge lies in the middle—the 70% of households between 80% and 150% AMI. These are working families earning $45,000 to $85,000 annually who make too much for subsidized housing but struggle with market rates. "That's the middle that we're trying to talk about addressing," Lyon explained. Here, parking costs become crucial. Surface parking costs about $30,000 per space; structured parking can reach $60,000. When developers must provide parking regardless of actual need, these costs get passed to residents as higher rents. Someone earning 80% AMI might afford to buy a $300,000 home, but it costs $500,000 to build—a $200,000 gap that parking requirements help create. Lyon argued that eliminating parking minimums, combined with other tools like the multifamily tax exemption and upcoming middle housing reforms, could help narrow this gap. The savings from not building excess parking could make development feasible at lower price points, naturally creating more affordable options without requiring subsidies. ## Council Perspectives: From Enthusiasm to Skepticism The council's response revealed a spectrum of views on both the policy and the process. ### The Urgent Advocates Council Member Jace Cotton led the charge for immediate action, framing the issue in stark terms: "We've underbuilt for decades. And as a renter on the first of every month, I personally pay a very real consequence of those decisions." Cotton dismissed concerns about tying parking reform to affordability mandates, arguing that such conditions—like the failed 12-year multifamily tax exemption program—often sound good but don't actually produce results. "I just don't see a scenario in which if the choice is, you know, build excess parking or build a little bit less parking and then build additional really expensive units that you have to rent at a loss that any builder is going to opt for the latter," Cotton said. Council Member Hannah Stone emphasized the interim nature of the ordinance and the city's ability to adjust course. She cited compelling examples from other cities, particularly Minneapolis, which saw a 12% increase in housing stock and a 12% decline in homelessness after eliminating parking minimums as part of broader reforms. Stone also highlighted local evidence: State Side Apartments downtown, which received a parking waiver and has 100 unbundled parking spaces. In 2023, almost half the residents didn't own cars—suggesting that when parking isn't mandatory, people make different transportation choices. Council Member Skip Williams supported the interim approach, emphasizing the importance of tailoring solutions to Bellingham's specific needs rather than copying policies from much larger cities. "Whatever we choose, whatever options we choose based on that research has got to be relevant to what we are facing right here in Bellingham, Washington." Council President Dan Hamill, participating virtually, focused on housing production numbers. "We are vastly behind in production. We need production on the ground. We need it now," he said. He dismissed affordability concerns as "just a NIMBY argument in my opinion" and emphasized the opportunity to replicate Old Town's success citywide. ### The Concerned Pragmatists Council Member Lisa Anderson articulated the strongest opposition, arguing that the ordinance represented a missed opportunity to tie parking reform to affordability requirements. She pointed to successful examples like the Pier development, which received height bonuses in exchange for affordable units, and questioned why similar exchanges couldn't be built into parking reform. Anderson also raised equity concerns about infrastructure. "I think of areas like Happy Valley that don't have the sidewalks, that don't have the bike lanes," she said. Without multimodal infrastructure in all neighborhoods, eliminating parking requirements could create unequal impacts. Her fundamental concern was economic: "The reality is that we live in a capitalist society. That's our economy. And even though a developer might be able to save money, I think there's this sense that people in the community believe that's going to lead to potentially lower rent. And things are always market rate. And the only way that we're going to have potentially lower rent for some of these units is if we require it." Anderson concluded she would vote no, standing on principle that the council should seriously consider affordability linkages before making such a significant change. ### The Complex Analysis Council Member Michael Lilliquist delivered perhaps the meeting's most intellectually rigorous intervention—a 20-minute discourse on market economics, complexity theory, and housing policy that both praised and challenged the ordinance. Lilliquist began by agreeing that "parking is broken. It's counterproductive and it needs to change." But he distinguished between housing production and housing affordability, arguing they're not the same thing. "That's a simplistic equation, and it's not an accurate one." Drawing on economic theory, Lilliquist explained how markets systematically fail in predictable ways. "Markets systematically fail. We know markets fail and they fail in one area. It's called a missing market. When the people in the so-called marketplace don't have enough money, the market is free to ignore them." He criticized the notion that "the market will choose the appropriate number" of parking spaces, arguing this misunderstands how markets work. Markets optimize for efficiency among willing participants, not public good. "That's not wisdom," he said. "The rational market thing to do is to take the profit, but externalize the costs." Lilliquist used housing burden data to show that Bellingham's affordability crisis hits hardest in the middle-income ranges—exactly the segment where market solutions are least reliable. He argued for a more targeted approach: eliminating parking minimums in urban centers and commercial areas where development is desired, while also waiving requirements for all affordable housing projects. "This is removing parking mandates where we want production and removing parking mandates where we want affordability," he explained. "This, I think, is a way of getting us both things we want, rather than one thing we want, and hoping that we're going to also get good benefits in the other thing we want." Despite his reservations, Lilliquist ultimately abstained rather than voting no, acknowledging the ordinance's benefits while expressing regret that deeper discussion hadn't occurred earlier. ## The Vote and Its Meaning After extensive discussion, the motion to approve the interim ordinance passed 5-1, with Anderson opposing and Lilliquist abstaining. The vote reflected not just policy preferences but different theories of change—whether to act boldly on available evidence or proceed more cautiously with additional safeguards. The ordinance now advances to a public hearing scheduled for January 13, 2025, followed by potential final adoption. If approved, it would take effect 15 days later and remain in place for up to one year while staff conducts additional research and develops permanent regulations. ## Grace Program Renewal: Quiet Consensus In stark contrast to the parking debate, the second agenda item—renewal of the interlocal agreement supporting the GRACE program—generated no controversy. Deputy Administrator Forrest Longman briefly described the Ground Level Response and Coordinated Engagement program, which provides intensive care coordination for frequent users of emergency services. The program, run by Whatcom County with Bellingham providing 40% of funding, aims to reduce emergency department visits, arrests, and jail admissions while improving participants' health and stability. The renewal includes a modest 3% annual increase and continues the city's commitment through 2026. The council approved the renewal unanimously without debate—a reminder that some city business proceeds smoothly when goals and methods align. ## Landlord-Tenant Relations: The Ongoing Struggle The meeting's final substantive items addressed landlord-tenant relations and restrictions on excessive fees—issues that have consumed considerable council time without reaching resolution. Council Member Cotton, who requested additional work session time, sought to clarify remaining disagreements and set direction for final action in January. The discussion revealed technical complexities around mandatory versus optional fees, disclosure requirements, and retaliation protections. Council members grappled with questions like whether landlords should be required to state affirmatively that tenants can't be denied housing for refusing optional fees, and whether size constraints should excuse full disclosure in apartment advertisements. These may seem like minor details, but they reflect broader tensions about how far government should go in regulating private rental markets. The discussion demonstrated both the difficulty of crafting clear, enforceable regulations and the challenge of balancing tenant protection with regulatory simplicity. ## Looking Forward: Growth, Transit, and Governance In closing business, council members shared updates on other regional challenges. Council Member Lilliquist reported on Whatcom Transportation Authority's budget, noting that WTA approved a $7.5 million operational deficit to maintain and expand services in the short term—a decision that underscores the difficulty of providing adequate transit while remaining financially sustainable. The transportation discussion connected directly to parking policy: if Bellingham wants to reduce car dependency, it needs robust alternatives. But building those alternatives requires resources that are increasingly constrained. Lilliquist also previewed upcoming decisions on countywide growth management planning, noting that over the next 20 years, Bellingham may need to accommodate 18,000 new housing units—13,000 for households below 100% AMI and 5,000 above. These numbers provide crucial context for the parking debate: if the city must nearly triple its current annual production to meet regional needs, removing regulatory barriers becomes essential. Council Member Anderson announced plans to propose a resolution supporting creation of a national infrastructure bank—a $5 trillion federal program that, if enacted, could help cities like Bellingham fund major infrastructure improvements without relying solely on local resources. ## The Complexity of Simple Solutions The December 16 meeting exemplified municipal governance at its most thoughtful and challenging. What appeared to be a straightforward question—should Bellingham eliminate parking minimums?—revealed deeper questions about market failure, government intervention, and the values cities should prioritize. The debate illuminated genuine tensions in progressive governance: between acting boldly on available evidence and proceeding cautiously with additional safeguards; between trusting markets to deliver public benefits and requiring specific outcomes; between addressing immediate housing needs and ensuring long-term affordability. Director Lyon's opening framework—the difference between complicated and complex systems—proved prophetic. The council's discussion was genuinely complex, involving multiple variables, competing values, and uncertain outcomes. But the current regulatory system is merely complicated—burdensome rules that no longer serve their original purpose. Whether Bellingham's choice to embrace complexity over complication will produce better outcomes remains to be seen. The interim ordinance provides a one-year experiment, a chance to gather evidence about how markets respond when freed from arbitrary constraints. That evidence will inform not just permanent parking regulations but broader questions about the proper relationship between government, markets, and community wellbeing. As council members filed out into the December cold, they carried with them both the satisfaction of decisive action and the uncertainty that accompanies any genuine attempt at reform. In a city facing multiple crises—housing, climate, equity—bold action carries risks. But as Director Lyon noted, what we want to happen must be greater than what we fear may happen. January's public hearing will reveal whether the broader community shares that calculus.