HOUSE BILL REPORT
HB 2649
As Reported by House Committee On:
Housing
Title: An act relating to providing affordable housing for all.
Brief Description: Creating an affordable housing for all program.
Sponsors: Representatives Miloscia, Hasegawa, Upthegrove and Ormsby.
Brief History:
Housing: 1/19/06, 1/26/06 [DPS].
Brief Summary of Substitute Bill |
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HOUSE COMMITTEE ON HOUSING
Majority Report: The substitute bill be substituted therefor and the substitute bill do pass. Signed by 5 members: Representatives Miloscia, Chair; Springer, Vice Chair; Ormsby, Pettigrew and Sells.
Minority Report: Do not pass. Signed by 4 members: Representatives Holmquist, Ranking Minority Member; Dunn, Assistant Ranking Minority Member; McCune and Schindler.
Staff: Robyn Dupuis (786-7166).
Background:
Existing Low Income Housing Surcharge
County auditors are required by statute to record deeds and other instruments that are filed
and recorded. Recording fees are set in statute. A $10 surcharge is charged for recording
certain documents to support low-income housing projects.
The county is allowed to keep up to 5 percent of the $10 surcharge for the collection,
administration, and local distribution of the funds. Of the remaining funds, 40 percent is
transmitted into the Housing Trust Fund administered by the Department of Community,
Trade, and Economic Development (DCTED). The remainder of the revenue generated is
transmitted to the counties for low-income housing programs and projects; which serve
households making at or below 50 percent of the area median income.
Affordable Housing Advisory Board (AHAB)
The AHAB is the principal advisory body on housing and housing-related issues. The AHAB
consists of 22 members representing a variety of industries, state agencies, populations and
geographic locations.
State Agency Responsibility for Affordable Housing
The DCTED is the principal agency responsible for the majority of the state's affordable
housing initiatives. The Department of Health is designated as the single state agency
responsible for encouraging and coordinating the development of temporary worker housing
(RCW 70.114A.040).
Growth Management Act Planning
Enacted in 1990 and 1991, the Growth Management Act (GMA) establishes a comprehensive
land use planning framework for county and city governments in Washington. Among other
requirements, planning jurisdictions must adopt internally consistent comprehensive land use
plans, which must satisfy requirements for specified "elements," including a housing element.
Comprehensive plans and development regulations must be reviewed and, if needed, revised
according to a recurring seven-year statutory schedule. Planning jurisdictions are required to
establish an evaluation program. Data collected through the review and evaluation program
shall be evaluated every five years. Copies of comprehensive plans are transmitted to the
DCTED. The DCTED is not required in statute to evaluate planning jurisdiction
comprehensive plans or performance. The DCTED will submit to the Legislature, by
December 31, 2007, a report on county activities related to planning and evaluation reviews.
Affordable Housing Statutes
There exist in statute numerous chapters under several titles which address affordable
housing.
Summary of Substitute Bill:
Creates Affordable Housing For All Program
Program Goals and Target Population:
(1) a decent, appropriate, and affordable home in a healthy, safe environment for every
low-income household by 2020; and
(2) an increased percentage of low-income households who do not rely on public support
for housing.
For the purpose of the Affordable Housing For All Program, low-income households are
defined as those earning 80 percent or less than the area median income, however, there is an
emphasis on serving households earning 50 percent or below the area median income.
Affordable housing is defined as housing for which the cost does not exceed 30 percent of the
occupying household's gross annual income.
Participation of Local Governments
Counties may decline to participate in the Affordable Housing for All program. In such an
instance, all funds due to a county will be remitted to the DCTED which will subcontract
with an entity to create and execute an Affordable Housing for All Plan for that county. Any
city may participate in the program and shall receive the portion of the funds attributable to
document recordings involving transactions within the city.
Program Funding
Document Recording Surcharge
The program is funded through an existing $10 surcharge on document recording fees.
Appropriation of General Funds
From the General Fund for Fiscal Year 2007, $2 million is appropriated for planning, data
collection and program implementation activities. Local governments receive $1 million of
this funding.
Affordable Housing Database
The DCTED will implement an Affordable Housing Database which will include information
on all affordable housing units which have received or are currently receiving state, federal or
local funds, funds from a non-profit organization, or financing through the Washington
Housing Finance Commission. This database will be searchable for housing referral
purposes. The DCTED will also encourage private landlords to list their units. The database
will be implemented by December 31, 2009.
Low-Income Housing Waiting List
The DCTED must produce a study regarding the potential effectiveness of a statewide
housing waiting list. Results will be reported to legislative committees by December 31,
2007.
State and Local Plans
The DCTED and participating local governments are required to produce annual Affordable
Housing For All Plans. Plans will document the need for affordable housing and will include
an activity plan to reach the goals of the program. The state plan is due to the Legislature by
December 31, 2007. Local plans are due by April 30, 2008. The DCTED will annually
evaluate local government plans as well as local program performance. The Affordable
Housing Advisory Board (AHAB) will evaluate the state plan. The Joint Legislative Audit
and Review Committee will audit the Affordable Housing for All Program every four years
beginning on or before December 31, 2009.
Quality Management
All local governments receiving more than $200,000 annually from the Affordable Housing
for All Program and the surcharge in RCW 36.22.179 (for homeless programs) must
implement a quality management program and apply to the Washington State Quality Award
Program every three years.
All Housing Authorities receiving more than $200,000 from the State or Housing Finance
Commission must implement a quality management program and apply to the Washington
State Quality Award Program every three years.
Other Affordable Housing Statutory Changes
Performance measure language is added to many affordable-housing related statutes.
Information regarding all affordable housing activities are required to be included in the
state's annually updated Affordable Housing for All Plan. In addition:
(a) RCW 70.114A.040 places the DCTED in charge of encouraging and coordinating the
development of temporary worker housing in collaboration with the Department of
Health;
(b) the AHAB is the principal advisory body to the state regarding affordable housing
issues and membership is limited to seventeen voting members from specific
industries; and
(c) for cities and counties planning under RCW 36.70A.040, the DCTED will evaluate
city and county performance as it relates to city and county comprehensive plans,
activities, and goals and leveraging funds to create and preserve affordable housing.
Substitute Bill Compared to Original Bill:
The substitute bill places an emphasis on serving households making at or below 50 percent
of the area median income, although the State and local governments may serve households
making up to 80 percent of the area median income. The substitute bill changes the
allocation of funding from the document recording surcharge back to the way it exists in
current statute (the DCTED is allocated 40 percent) and all documents previously exempted
under the current surcharge maintain their exemption (the original bill removed the
exemption). The DCTED may use some of its allocation of funds to award planning grants to
counties receiving less than $20,000 annually, as opposed to the $10,000 threshold in the
original bill. The Department of Labor and Industry, instead of the DCTED, is charged with
defining the living wage statewide and within each county. Local governments need no
longer evaluate their subcontractors. The substitute bill strikes almost all of the
recodifications called for in the original bill except for a few sections dealing with the
AHAB, and removes several sections including surplus property statutes and amending
Growth Management Act comprehensive plan elements. The threshold for local
governments to implement a quality management program and apply to the Washington State
Quality Award Program is lowered from $400,000 to $200,000. Housing Authorities have a
similar requirement. The primary objective of housing authorities is included in statute and
local governments must annually evaluate their housing authority. The DCTED is required to
evaluate all state agencies in relation to their housing efforts and forward copies of the
evaluations to the appropriate committees of the Legislature.
Appropriation: None.
Fiscal Note: Preliminary fiscal note available.
Effective Date of Substitute Bill: The bill takes effect 90 days after adjournment of session in which bill is passed.
Testimony For: (With concerns on original bill) The underlying principals and goals of this
bill are admirable however, there is widespread concern amongst housing providers that the
annual reporting, planning, evaluation and data collection requirements may become onerous.
Furthermore, fulfilling these requirements will cost money and there are already limited
financial resources for housing. All available funding should be reserved for actual housing
production. There is a need to make sure all the data to be collected through this bill serves a
purpose. The emphasis on funding programs and projects serving very-low income
households earning incomes at or below 50 percent of the area median income should be
maintained, not increased to households earning 80 percent. There are concerns that the
recodification of Housing Authority statutes, as well as other statutes throughout the code,
may have unintended consequences. Housing Authorities are already subject to
scrutinization through their other funders, an annual evaluation by the DCTED would not be
an efficient use of state resources and would be a drain on Housing Authority resources. The
bill should be split up into more manageable pieces, it's hard to understand the implications.
The AHAB should remain as the DCTED's principal advisory body. Rental vouchers should
play a more prevalent role in affordable housing strategies and should be included in this bill.
County governments are already stretched thin, it's questionable whether or not they have the
capability to undertake such a program. The elimination of the exemption for certain
documents from the recording fee surcharge may have a negative impact on private
financiers.
(Neutral to original bill) The goals of this bill are admirable, affordable housing is critical to
community stability and growth. In particular, key public servants need to be able to afford
to live where they work. There is a concern about the additional responsibilities to be placed
on counties through this bill, however, the counties are already overwhelmed and this would
add to an already overcrowded agenda of activities.
Testimony Against: (Opposed to original bill) The bill should include a short term voucher program. Also, Housing Authorities are local governments and should be treated equally.
Persons Testifying: (With concerns on original bill) Carla Okigwe, Housing Development
Consortium; Chris Pegg, Association of Washington Housing Authorities; Lavon Holden,
Vancouver Housing Authority; Paul Purcell, Beacon Development Group; Kim Herman,
Washington State Housing Finance Commission; Dave Williams, Association of Washington
Cities; Judy Reed, Washington Community Reinvestment; and Jerry Van Fossen and Terry
Kohl, Washington Apartment Association.
(Opposed to original bill) Tom Drake, Bremerton Housing Authority.
(Neutral to original bill) Jean Wessman, Washington State Association of Counties.