By REP. PHYLLIS GUITERREZ KENNEY

Seattle's housing crunch is upon us. It's no longer anecdotal. We all know people who are struggling to find an affordable home. These people are, by and large, people who are middle-income, who in the past would have had no trouble finding a decent home at their income level. Even for renters, costs have gone sky-high.

We are the victim of our own success. Seattle is doing well economically. Jobs are plentiful and decent homes are not going unsold. Enterprises like Microsoft have created a whole new set of millionaires.

But there's a flip side to this new growth and wealth. It's happened so quickly, available housing hasn't kept up. We've seen housing price jumps in the 1970s, late 1980s and now. These price spikes have been coupled with a real housing shortage. Construction hasn't been able to keep up with demand. Consequently, the median price of a home in King County has risen to nearly $250,000.

Amid this environment, government policies for affordable housing are in a state of flux. The federal government recently threatened to curtail long-time housing supports. Proposed cuts could have cost the state of Washington as much as $100 million. Fortunately, we escaped such serious federal cuts this year. Instead, President Clinton's budget provided for an increase in section 8 certificates targeted to recipients of the new welfare program.

For some time now, I've been concerned about affordable housing. A few months ago, I began convening the first statewide advisory group on affordable housing. Representatives of the Governor's office, the Legislature, community and civic groups, and housing industry officials have been trying to work out legislative solutions. Here are a few proposals:

€ Increase funding for the Housing Trust Fund. The Housing Trust Fund works with local and federal governments, financial lenders and non-profit corporations to construct or rehabilitate low-income housing. In recent biennia, the Legislature has allocated approximately $50 million a biennium to the Housing Trust Fund. Low-income housing supporters have proposed to increase state funding for the Trust Fund to $100 million biennially.

€ Local funding sources. In many jurisdictions, the availability of a local option funding source for low-income housing would allow new housing investment. Low-income housing supporters have proposed establishment of a local option funding source, such as approved property tax levies.

€ Tax incentives for low-income and affordable housing. In the last few years, tax benefits have been proposed as incentives for many activities. Options include providing rehabilitation of low-income or affordable housing or exempting low-income housing from existing taxes, such as sales or property tax, to reduce the cost of creating new or rehabilitated low-income housing.

€ Increasing bond limits. Another option is to increase the statuatory debt limit, which would allow the State to create more room in its Capital Budget for bonding projects that would directly benefit low-income and affordable housing. In the past, housing projects consumed roughly 40 percent of all state bonding projects. We can recommit to housing as a priority, by increasing our bond caps and limits.

There are other issues which need resolving. How do we increase the supply of safe, affordable housing for the elderly? How will we retrofit existing elderly housing, bringing it up to new safety standards?

We must spend our money prudently, with a sharp eye for good investment and solid return. Our work is not finished until we make housing affordable for the middle class, until we resolve the homelessness problem for those less fortunate. For all of us need a sense of place, a sense of permanence. Our personal well-being, and the well-being of our community depends on it.

Rep. Phyllis Guiterrez Kenney (D-Seattle) represents the 46th District in North Seattle.