By Paul Gottlieb
For Peninsula Daily News
OLYMPIA — Gov. Jay Inslee’s $4 billion housing bond proposal made its first stop among House lawmakers at the desk of Port Townsend resident Steve Tharinger, chair of the Capital Budget Committee.
Bond proceeds would expand housing services to homeless and developmentally disabled individuals and help fund construction of more than 24,000 low-income housing units, mostly apartments, through 2030. It would fund assistance to local governments for one-time water, sewer and stormwater-system costs. It also would fund a revolving fund loan program to build low-income housing.
The bond would be used between 2025 and 2030.
Tharinger, a Port Townsend resident and Inslee’s fellow Democrat, said Friday he is working through the details of HB 1149.
The proposal and its companion in the Senate, SB 5202, would need approval by two-thirds of each chamber before voters consider the measure for simple-majority approval in the Nov. 7 election.
Voter approval is required because the measure would exceed the state’s debt limit.
The State Finance Committee would issue the general obligation bonds, the proceeds of which would pay for the housing programs and expenses incurred from the sale and issuance of the bonds.
The proposal, known as the Washington Housing Crisis Response Act, would when combined with existing funds and leveraged private market funding “create 17,720 multifamily rental units in the next six years, including 4,960 units during the 2023-25 biennium,” according to the Office of Financial Management (ofm.wa.gov).
Multifamily units are defined in state law as buildings with four or more non-transient dwelling units.
Tharinger predicted Thursday voters would support the measure — but was not ready to endorse it in its present form.
“I think folks morally and visually would like to see people not living in tents and parks and under bridges, and [instead] in some sort of housing,” said Tharinger, who represents the Legislative District 24 — which covers Clallam and Jefferson counties and part of Grays Harbor County — along with Rep. Mike Chapman of Port Angeles and Sen. Kevin Van De Wege of Sequim.
As of Friday, the proposal headlined more than 50 bills addressing housing and homelessness — all listed at leg.wa.gov under “Bill Status Report” — as the 2023-2025 biennial budget session ended its second full week.
The bond proposal would add 5,300 additional affordable housing units statewide in 2023-25 over the 2,200 affordable housing units Inslee already has proposed in his capital budget, and 19,000 units in the following three biennia, according to an analysis by the state Office of Financial Management.
“What [Inslee] has proposed is pretty bold,” Tharinger said.
It was fleshed out Jan. 12 in a capital budget House Capital Budget Committee hearing.
Tharinger said he is “sort of neutral at this point” on the bill.
“I’m a little concerned about the increased borrowing. We need to figure out how expensive this is and what the impact will be on our bond rating. We have a lot of homework to do.
“At the end of the day, it may be the solution, but it’s too early to tell.”
According to the Point in Time census of homeless individuals, in 2022, Clallam County had 178 homeless men and women in 136 households, including 20 with minors. Jefferson County had 130 homeless individuals in 2022, including at least 11 minors.
Statewide, 13,000 individuals were unsheltered in 2022, up 20 percent compared to 2020, and not including those living in emergency shelters.
A new Point in Time count will be on the night of Jan. 26, according to the state Department of Commerce.
The bond provides funding for permanent supportive housing, assists socially disadvantaged first-time homebuyers, and would help purchase property for enhanced emergency shelters.
Inslee’s 2023-25 capital budget includes anticipated referendum funding.
Housing Trust Fund
Of the total, $440 million would be spent on Housing Trust Fund multifamily housing units for low-income and special-needs residents, including those who are homeless and have chronic mental illnesses.
The Housing Trust Fund, administered by the state Department of Commerce, provides loans and grants for housing for people earning less than 80 percent of the area median income, “but most of these properties house households with special needs or incomes of below 30 percent of the Area Median Income,” according to the agency (commerce.wa.gov).
Clallam County’s median income was $29,134 and Jefferson County’s, $30,174 in 2020.
About a half-dozen Republicans each in the House and Senate would need to side with a unanimous contingent of Democrats for the bond to make its way to voters statewide in November.
“It does not seem like too high a bar,” Tharinger said, predicting a floor vote in April, when the 105-day session adjourns.
“The governor was pretty aspirational and really came to us and said, hey, let’s go big,” he said.
“This is one way to do that to meet this crisis head-on. This is the governor’s role, whether it’s on climate, housing or behavior health. He puts out a plan to give us running room to figure out the best way.”
Loan program
Bond proceeds would fuel a revolving-loan-based Workforce Housing Accelerator Program that would receive $50 million in the 2023-25 biennium.
It would provide funding to developers, nonprofits and public housing and development authorities for affordable housing. Loan interest would be 1 percent-2.5 percent for up to 30 years.
The income of qualified low-income households eligible for the Accelerator Program would fall between 50 and 80 percent of the area median income.
Forks City Attorney-Planner Rod Fleck said the qualifying median income levels should be broadened.
“This is, again, a narrow slice of the housing market, and we actually need to be looking at the next slice, 80 to 115 percent of income, roughly the $36,000 [a year] wage earner as well,” Fleck said.
Most speakers Wednesday at a Senate Housing Committee meeting on SB 5202 praised Inslee’s proposal.
Those in favor included homelessness advocates; Mary Hull-Drury, Washington Realtors Commercial Government Affairs director; and John Traynor, Washington State Labor Council, AFL-CIO Legislative director.
Traynor said the bond would meet housing-crisis needs across the state, would prevent future homelessness, and “is a great jobs package.”
Rather than being for or against SB 5202, Dave Mastin, vice president of government affairs for the Association of Washington Business, tabbed himself as “other” regarding the bond.
Better, Mastin said, to assuage permit delays and building costs, impediments to private-sector housing development that present the same roadblocks to construction under Inslee’s plan.
“Part of the money in this proposal isn’t going to go to housing, it’s going to go to the cost of creating housing,” Mastin said.
State officials say the bond proposal only begins to meet Washington’s housing needs. OFM has estimated the state needs 1 million more housing units by 2044 to keep pace with population growth.
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Legislative Reporter Paul Gottlieb, a former senior reporter at Peninsula Daily News, can be reached at cpaulgottlieb@gmail.com.
