S-3727.1

SENATE BILL 5954

BySenators Gildon, Braun, Dozier, Fortunato, Honeyford, King, Muzzall, Schoesler, Wagoner, Warnick, J. Wilson, and L. Wilson

AN ACT Relating to reducing the impacts and incidences of chronic and unsheltered homelessness; amending RCW 43.185C.030, 69.50.4011, 69.50.4013, 10.31.115, and 74.04.660; reenacting and amending RCW 43.185C.060 and 43.185C.190; adding a new section to chapter 43.21A RCW; adding a new section to chapter 82.04 RCW; adding a new section to chapter 82.16 RCW; creating new sections; repealing 2021 c 311 ss 15 and 16; repealing 2021 c 311 s 29 (uncodified); prescribing penalties; making appropriations; and providing expiration dates.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

The legislature also finds that policies enacted to date have not worked, despite Washingtonians putting in billions of dollars to alleviate and address the problem. Individuals experiencing chronic and unsheltered homelessness, along with the residents of the state, deserve better. It is in the interest of the state to enact policies that create a path to entering into society and living functional, productive lives. This goal requires addressing public safety, recovery from addiction, and housing security.

Therefore, it is the intent of the legislature with this act to enact policies that will reduce both the incidences and impacts of chronic and unsheltered homelessness in our state.

Sec. 2. RCW 43.185C.030 and 2018 c 85 s 3 are each amended to read as follows:

(1) The department shall annually conduct a Washington homeless census or count consistent with the requirements of RCW 43.185C.180. The census shall make every effort to count all homeless individuals living outdoors, in shelters, and in transitional housing, coordinated, when reasonably feasible, with already existing homeless census projects including those funded in part by the United States department of housing and urban development under the McKinney-Vento homeless assistance program. In addition, the census shall make every effort to count individuals who are currently admitted into hospitals or incarcerated in city or county jails who had no permanent address at the time of admission. The department shall determine, in consultation with local governments, the data to be collected. Data on subpopulations and other characteristics of the homeless must, at a minimum, be consistent with the United States department of housing and urban development's point-in-time requirements. Data and information collected about individuals who are currently admitted into hospitals or incarcerated in city or county jails and had no permanent address at the time of admission are not required to be submitted to the United States department of urban housing and development to ensure uniformity of information across states.

(2) All personal information collected in the census is confidential, and the department and each local government shall take all necessary steps to protect the identity and confidentiality of each person counted.

(3) The department and each local government are prohibited from disclosing any personally identifying information about any homeless individual when there is reason to believe or evidence indicating that the homeless individual is an adult or minor victim of domestic violence, dating violence, sexual assault, or stalking or is the parent or guardian of a child victim of domestic violence, dating violence, sexual assault, or stalking; or revealing other confidential information regarding HIV/AIDS status, as found in RCW 70.02.220. The department and each local government shall not ask any homeless housing provider to disclose personally identifying information about any homeless individuals when the providers implementing those programs have reason to believe or evidence indicating that those clients are adult or minor victims of domestic violence, dating violence, sexual assault, or stalking or are the parents or guardians of child victims of domestic violence, dating violence, sexual assault, or stalking. Summary data for the provider's facility or program may be substituted.

(4) The Washington homeless census shall be conducted annually on a schedule created by the department. The department shall make summary data by county available to the public each year. This data, and its analysis, shall be included in the department's annual updated homeless housing program strategic plan.

(5) Based on the annual census and provider information from the local government plans, the department shall, by the end of year four, implement an online information and referral system to enable local governments and providers to identify available housing for a homeless person. The department shall work with local governments and their providers to develop a capacity for continuous case management to assist homeless persons.

(6) By the end of year four, the department shall implement an organizational quality management system.

NEW SECTION.  Sec. 3. A new section is added to chapter 43.21A RCW to read as follows:

Subject to the availability of amounts appropriated for this specific purpose, the department must provide grants to local governments to clean up solid, hazardous, and infectious waste generated by homeless encampments.

(2) The legislature categorizes these tax preferences as ones intended to induce certain designated behavior by taxpayers and create or retain jobs, as indicated in RCW 82.32.808(2) (a) and (c).

(3) It is the legislature's specific public policy objective to encourage the employment of certain unemployed persons, such as persons convicted of a felony and homeless persons. It is the legislature's intent to provide employers a credit against the business and occupation tax or public utility tax for hiring certain unemployed persons which would reduce an employer's tax burden thereby inducing employers to hire and create jobs for such persons. Pursuant to chapter 43.136 RCW, the joint legislative audit and review committee must review the business and occupation tax and public utility tax credit established under sections 6 and 7, chapter . . ., Laws of 2022 (sections 6 and 7 of this act) by December 31, 2031.

(4) If a review finds that the number of unemployed persons who meet the criteria in section 6(7)(c)(i) or 7(7)(c)(i) of this act decreased by 30 percent, then the legislature intends for the legislative auditor to recommend extending the expiration date of the tax preference.

(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee should refer to unemployment rates available from the employment security department and the bureau of labor statistics.

NEW SECTION.  Sec. 6. A new section is added to chapter 82.04 RCW to read as follows:

(1) A person is allowed a credit against the tax due under this chapter as provided in this section. The credit equals the lesser of 10 percent or $500 of wages and benefits paid to or on behalf of a qualifying employee, with a maximum of a $500 credit for each qualifying employee hired on or after October 1, 2022.

(2) No credit may be claimed under this section until a qualifying employee has been employed for at least three consecutive full calendar quarters.

(3) Unused credit may be carried over and used in subsequent tax reporting periods, except as provided in subsection (8) of this section. No refunds may be granted for credits under this section.

(4) If an employer discharges a qualifying employee for whom the employer has claimed a credit under this section, the employer may not claim a new credit under this section for a period of one year from the date the qualifying employee was discharged. However, this subsection (4) does not apply if the qualifying employee was discharged for misconduct, as defined in RCW 50.04.294, connected with his or her work or discharged due to a felony or gross misdemeanor conviction, and the employer contemporaneously documents the reason for discharge.

(5) Credits earned under this section may be claimed only on returns filed electronically with the department using the department's online tax filing service or other method of electronic reporting as the department may authorize. No application is required to claim the credit, but the taxpayer must keep records necessary for the department to determine eligibility under this section including records establishing the person's status as a qualifying employee under subsection (7)(c)(i) and (ii) of this section when hired by the taxpayer.

(6) No person may claim a credit against taxes due under both this chapter and chapter 82.16 RCW for the same qualifying employee.

(7) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.

(a) "Homeless person" has the same meaning as provided in RCW 43.185C.010.

(b) "Person convicted of a felony" means a person, including a juvenile as defined in RCW 13.40.020, convicted of a felony under state or federal statute who is hired within one calendar year after the last date that the person was convicted or released from a juvenile rehabilitation facility or prison.

(c) "Qualifying employee" means a person who meets all of the following requirements:

(i) Is a homeless person or a person convicted of a felony;

(ii) Was unemployed as defined in RCW 50.04.310 for at least 30 days immediately preceding the date that the person was hired by the person claiming the credit under this section; and

(iii) Is employed in a permanent full-time position for at least three consecutive full calendar quarters by the person claiming the credit under this section. For seasonal employers, "qualifying employee" also includes the equivalent of a full-time employee in work hours for two consecutive full calendar quarters. For purposes of this subsection (7)(c)(iii), "full-time" means a normal workweek of at least 35 hours.

(8) Credits allowed under this section can be earned for tax reporting periods through June 30, 2031. No credits can be claimed after June 30, 2032.

(9) This section expires July 1, 2032.

NEW SECTION.  Sec. 7. A new section is added to chapter 82.16 RCW to read as follows:

(1) A person is allowed a credit against the tax due under this chapter as provided in this section. The credit equals the lesser of 10 percent or $500 of wages and benefits paid to or on behalf of a qualifying employee, with a maximum of a $500 credit for each qualifying employee hired on or after October 1, 2022.

(2) No credit may be claimed under this section until a qualifying employee has been employed for at least three consecutive full calendar quarters.

(3) Unused credit may be carried over and used in subsequent tax reporting periods, except as provided in subsection (8) of this section. No refunds may be granted for credits under this section.

(4) If an employer discharges a qualifying employee for whom the employer has claimed a credit under this section, the employer may not claim a new credit under this section for a period of one year from the date the qualifying employee was discharged. However, this subsection (4) does not apply if the qualifying employee was discharged for misconduct, as defined in RCW 50.04.294, connected with his or her work or discharged due to a felony or gross misdemeanor conviction, and the employer contemporaneously documents the reason for discharge.

(5) Credits earned under this section may be claimed only on returns filed electronically with the department using the department's online tax filing service or other method of electronic reporting as the department may authorize. No application is required to claim the credit, but the taxpayer must keep records necessary for the department to determine eligibility under this section including records establishing the person's status as a qualifying employee under subsection (7)(c)(i) and (ii) of this section when hired by the taxpayer.

(6) No person may claim a credit against taxes due under both chapter 82.04 RCW and this chapter for the same qualifying employee.

(7) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.

(a) "Homeless person" has the same meaning as provided in RCW 43.185C.010.

(b) "Person convicted of a felony" means a person, including a juvenile as defined in RCW 13.40.020, convicted of a felony under state or federal statute who is hired within one calendar year after the last date that the person was convicted or released from a juvenile rehabilitation facility or prison.

(c) "Qualifying employee" means a person who meets all of the following requirements:

(i) Is a homeless person or a person convicted of a felony;

(ii) Was unemployed as defined in RCW 50.04.310 for at least 30 days immediately preceding the date that the person was hired by the person claiming the credit under this section; and

(iii) Is employed in a permanent full-time position for at least three consecutive full calendar quarters by the person claiming the credit under this section. For seasonal employers, "qualifying employee" also includes the equivalent of a full-time employee in work hours for two consecutive full calendar quarters. For purposes of this subsection (7)(c)(iii), "full-time " means a normal workweek of at least 35 hours.

(8) Credits allowed under this section can be earned for tax reporting periods through June 30, 2031. No credits can be claimed after June 30, 2032.

(9) This section expires July 1, 2032.

Sec. 8. RCW 69.50.4011 and 2021 c 311 s 8 are each amended to read as follows:

(1) Except as authorized by this chapter, it is unlawful for:

(a) Any person to create or deliver a counterfeit substance; or

(b) Any person to knowingly possess a counterfeit substance.

(2) Any person who violates subsection (1)(a) of this section with respect to:

(a) A counterfeit substance classified in Schedule I or II which is a narcotic drug, or flunitrazepam classified in Schedule IV, is guilty of a class B felony and upon conviction may be imprisoned for not more than ten years, fined not more than twenty-five thousand dollars, or both;

(b) A counterfeit substance which is methamphetamine, is guilty of a class B felony and upon conviction may be imprisoned for not more than ten years, fined not more than twenty-five thousand dollars, or both;

(c) Any other counterfeit substance classified in Schedule I, II, or III, is guilty of a class C felony punishable according to chapter 9A.20 RCW;

(d) A counterfeit substance classified in Schedule IV, except flunitrazepam, is guilty of a class C felony punishable according to chapter 9A.20 RCW;

(e) A counterfeit substance classified in Schedule V, is guilty of a class C felony punishable according to chapter 9A.20 RCW.

(3) A violation of subsection (1)(b) of this section is a ((misdemeanor))class C felony. The prosecutor is encouraged to divert such cases for assessment, treatment, or other services for a person's first two violations under this subsection.

Sec. 9. RCW 69.50.4013 and 2021 c 311 s 9 are each amended to read as follows:

(1) It is unlawful for any person to knowingly possess a controlled substance unless the substance was obtained directly from, or pursuant to, a valid prescription or order of a practitioner while acting in the course of his or her professional practice, or except as otherwise authorized by this chapter.

(2) Except as provided in RCW 69.50.4014, any person who violates this section is guilty of a ((misdemeanor))class C felony punishable under chapter 9A.20 RCW.

(3) The prosecutor is encouraged to divert cases under this section for assessment, treatment, or other services for a person's first two violations.

(4)(a) The possession, by a person twenty-one years of age or older, of useable marijuana, marijuana concentrates, or marijuana-infused products in amounts that do not exceed those set forth in RCW 69.50.360(3) is not a violation of this section, this chapter, or any other provision of Washington state law.

(b) The possession of marijuana, useable marijuana, marijuana concentrates, and marijuana-infused products being physically transported or delivered within the state, in amounts not exceeding those that may be established under RCW 69.50.385(3), by a licensed employee of a common carrier when performing the duties authorized in accordance with RCW 69.50.382 and 69.50.385, is not a violation of this section, this chapter, or any other provision of Washington state law.

(5)(a) The delivery by a person twenty-one years of age or older to one or more persons twenty-one years of age or older, during a single twenty-four hour period, for noncommercial purposes and not conditioned upon or done in connection with the provision or receipt of financial consideration, of any of the following marijuana products, is not a violation of this section, this chapter, or any other provisions of Washington state law:

(i) One-half ounce of useable marijuana;

(ii) Eight ounces of marijuana-infused product in solid form;

(iii) Thirty-six ounces of marijuana-infused product in liquid form; or

(iv) Three and one-half grams of marijuana concentrates.

(b) The act of delivering marijuana or a marijuana product as authorized under this subsection (5) must meet one of the following requirements:

(i) The delivery must be done in a location outside of the view of general public and in a nonpublic place; or

(ii) The marijuana or marijuana product must be in the original packaging as purchased from the marijuana retailer.

(6) No person under twenty-one years of age may possess, manufacture, sell, or distribute marijuana, marijuana-infused products, or marijuana concentrates, regardless of THC concentration. This does not include qualifying patients with a valid authorization.

(7) The possession by a qualifying patient or designated provider of marijuana concentrates, useable marijuana, marijuana-infused products, or plants in accordance with chapter 69.51A RCW is not a violation of this section, this chapter, or any other provision of Washington state law.

Sec. 10. RCW 10.31.115 and 2021 c 311 s 13 are each amended to read as follows:

(1) For all individuals who otherwise would be subject to arrest for possession of a counterfeit substance under RCW 69.50.4011, possession of a controlled substance under RCW 69.50.4013, possession of 40 grams or less of marijuana under RCW 69.50.4014, or possession of a legend drug under RCW 69.41.030(2)(b), in lieu of jail booking and referral to the prosecutor, law enforcement ((shall))may offer a referral to assessment and services available pursuant to RCW 10.31.110 or other program or entity responsible for receiving referrals in lieu of legal system involvement, which may include the recovery navigator program established under RCW 71.24.115.

(2) If law enforcement agency records reflect that an individual has been diverted to referral for assessment and services twice or more previously, officers may, but are not required to, make additional diversion efforts.

(3) Nothing in this section precludes prosecutors from diverting or declining to file any charges for possession offenses that are referred under RCW 69.50.4011, 69.50.4013, 69.50.4014, or 69.41.030(2)(b) in the exercise of their discretion.

(1) 2021 c 311 s 15;

(2) 2021 c 311 s 16; and

(3) 2021 c 311 s 29 (uncodified).

(2) The sum of $10,000,000 is appropriated for the fiscal year ending June 30, 2023, from the general fund for expenditure into the criminal justice treatment account created in RCW 71.24.580.

(3) The sum of $10,000,000, or as much thereof as may be necessary, is appropriated for the fiscal biennium ending June 30, 2023, from the criminal justice treatment account to the state health care authority for the purpose of increasing criminal justice treatment account distributions in accordance with RCW 71.24.580.

(a) There were 10,814 unsheltered individuals in Washington state that were counted in the 2020 homeless point in time count, of which 1,080 were under the age of 25. The census also recorded 794 unsheltered households with children.

(b) Unsheltered homelessness includes encampments in greenbelts, under bridges, and on our streets and are a visible reminder that the current system is not working and that youth and young adults are living in conditions not meant for human habitation.

(c) The purpose of this section is to eliminate unsheltered homelessness for youth and young adults and families with children through investment in permanent housing solutions.

(2) The sum of $51,610,000 is appropriated for the fiscal year ending June 30, 2023, from the general fund into the Washington housing trust fund created in RCW 43.185.030 for the sole purpose of providing permanent housing solutions to unsheltered youth and young adults and unsheltered families with children. The department of commerce may expend these moneys for housing acquisition, construction, or other housing production costs necessary to achieve the goal of eliminating unsheltered youth and young adult homelessness.

Sec. 14. RCW 74.04.660 and 2021 c 9 s 1 are each amended to read as follows:

The department shall establish a consolidated emergency assistance program for individuals and families with or without children. Assistance may be provided in accordance with this section.

(1) Benefits provided under this program shall be limited to one period of time, as determined by the department, within any consecutive twelve-month period.

(2) Benefits under this program shall be provided to alleviate emergent conditions resulting from insufficient income and resources to provide for: Food, shelter, clothing, medical care, or other necessary items, as defined by the department. Benefits may also be provided for family reconciliation services, family preservation services, home-based services, short-term substitute care in a licensed agency as defined in RCW 74.15.020, crisis nurseries, therapeutic child care, or other necessary services as defined by the department. Benefits shall be provided only in an amount sufficient to cover the cost of the specific need, subject to the limitations established in this section.

(3)(a) The department shall, by rule, establish assistance standards and eligibility criteria for this program in accordance with this section.

(b) Eligibility for benefits or services under this section does not automatically entitle a recipient to medical assistance.

(4) The department shall seek federal emergency assistance funds to supplement the state funds appropriated for the operation of this program as long as other departmental programs are not adversely affected by the receipt of federal funds.

(5) If state funds appropriated for the consolidated emergency assistance program are exhausted, the department may discontinue the program.

(6) During a state of emergency and pursuant to an order from the governor under this subsection, benefits under this program may be ((extended to individuals and families without children and may be)) provided for more than one period of time within any consecutive 12-month period, as established in an order from the governor. Adjustments to the program under this subsection remain in effect until either the state of emergency ceases, the order expires, or the governor issues an order terminating these adjustments, whichever occurs first.

(2) The sum of $750,000 is appropriated for the fiscal year ending June 30, 2023, from the general fund to the department of social and health services to provide assistance to eligible families and individuals under the consolidated emergency assistance program pursuant to RCW 74.04.660.

Sec. 16. RCW 43.185C.060 and 2021 c 334 s 980 and 2021 c 214 s 4 are each reenacted and amended to read as follows:

(1)(a) The home security fund account is created in the state treasury, subject to appropriation. The state's portion of the surcharge established in RCW 36.22.179 ((and)), 36.22.1791, and 36.22.176 must be deposited in the account. Expenditures from the account may be used only for homeless housing programs as described in this chapter, including the eviction prevention rental assistance program established in RCW 43.185C.185.

(2)(a) By December 15, 2021, the department, in consultation with stakeholder groups specified in RCW 43.185C.185(2)(c), must create a set of performance metrics for each county receiving funding under RCW 36.22.176. The metrics must target actions within a county's control that will prevent and reduce homelessness, such as increasing the number of permanent supportive housing units and increasing or maintaining an adequate number of noncongregate shelter beds.

(b)(i) Beginning July 1, 2023, and by July 1st every two years thereafter, the department must award funds for project-based vouchers for nonprofit housing providers and related services, rapid rehousing, and housing acquisition under RCW 36.22.176 to eligible grantees in a manner that 15 percent of funding is distributed as a performance-based allocation based on performance metrics created under (a) of this subsection, in addition to any base allocation of funding for the county.

(ii) Any county that demonstrates that it has met or exceeded the majority of the target actions to prevent and reduce homelessness over the previous two years must receive the remaining 15 percent performance-based allocation. Any county that fails to meet or exceed the majority of target actions to prevent and reduce homelessness must enter into a corrective action plan with the department. To receive its performance-based allocation, a county must agree to undertake the corrective actions outlined in the corrective action plan and any reporting and monitoring deemed necessary by the department. Any county that fails to meet or exceed the majority of targets for two consecutive years after entering into a corrective action plan may be subject to a reduction in the performance-based portion of the funds received in (b)(i) of this subsection, at the discretion of the department in consultation with stakeholder groups specified in RCW 43.185C.185(2)(c). Performance-based allocations unspent due to lack of compliance with a corrective action plan created under this subsection (2)(b) may be distributed to other counties that have met or exceeded their target actions.

(3) The department must distinguish allotments from the account made to carry out the activities in RCW 43.330.167, 43.330.700 through 43.330.715, 43.330.911, 43.185C.010, 43.185C.250 through 43.185C.320, and 36.22.179(1)(b).

(4) The office of financial management must secure an independent expenditure review of state funds received under RCW 36.22.179(1)(b) on a biennial basis. The purpose of the review is to assess the consistency in achieving policy priorities within the private market rental housing segment for housing persons experiencing homelessness. The independent reviewer must notify the department and the office of financial management of its findings. The first biennial expenditure review, for the 2017-2019 fiscal biennium, is due February 1, 2020. Independent reviews conducted thereafter are due February 1st of each even-numbered year.

(5) During the 2019-2021 and 2021-2023 fiscal biennia, expenditures from the account may also be used for shelter capacity grants.

Sec. 17. RCW 43.185C.190 and 2021 c 334 s 981 and 2021 c 214 s 5 are each reenacted and amended to read as follows:

(1) The affordable housing for all account is created in the state treasury, subject to appropriation. The state's portion of the surcharges established in RCW 36.22.178 and 36.22.176 shall be deposited in the account. Expenditures from the account may only be used for affordable housing programs, including operations, maintenance, and services as described in RCW 36.22.176(1)(a).

(3) During the 2021-2023 fiscal biennium, expenditures from the account may be used for operations, maintenance, and services for permanent supportive housing as defined in RCW 36.70A.030. It is the intent of the legislature to continue this policy in future biennia.

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