BILL REQ. #:  H-3758.2 

Prefiled 1/3/2006. Read first time 01/09/2006.   Referred to Committee on Housing.

     AN ACT Relating to affordable housing; amending RCW 82.45.060, 43.135.035, and 43.135.035; amending 2005 c 488 s 927 (uncodified); adding new sections to chapter 43.185 RCW; adding a new section to 2005 c 488 (uncodified); making appropriations; providing an effective date; providing expiration dates; and declaring an emergency.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 43.185 RCW to read as follows:
     The legislature finds that Washington is experiencing an affordable housing crisis and that this crisis is growing exponentially every year as the population of the state expands and housing values increase at a rate that far exceeds most households' proportionate increase in income. The legislature further finds that while the rapid increase in housing values has exacerbated the affordable housing crisis, the phenomena has also dramatically benefited the state's general fund, the growth of which is directly attributable to increased proceeds from the real estate excise tax.
     The fiscal and societal costs of the lack of adequate affordable housing are high for both the public and private sectors. However, the legislature finds that while real estate generates large amounts of revenue, current levels of funding for affordable housing programs are inadequate to meet the housing needs of many low-income Washington households.
     Therefore, the legislature declares that a portion of the increased revenue generated from the real estate excise tax must be used to support affordable housing programs that assist low-income households obtain and retain housing. It is the intent of the legislature to appropriate funds for the purposes and amounts identified in section 4 of this act in the fiscal years ending on June 30, 2007, June 30, 2008, June 30, 2009, and June 30, 2010.

Sec. 2   RCW 82.45.060 and 2005 c 450 s 1 are each amended to read as follows:
     (1) There is imposed an excise tax upon each sale of real property at the rate of one and twenty-eight one-hundredths percent of the selling price. An amount equal to six and one-tenth percent of the proceeds of this tax to the state treasurer shall be deposited in the public works assistance account created in RCW 43.155.050. An amount equal to one and six-tenths percent of the proceeds of this tax to the state treasurer shall be deposited in the city-county assistance account created in RCW 43.08.290.
     (2) An amount equal to 3.039 percent of the proceeds of this tax to the state treasurer in the fiscal year ending June 30, 2005, shall be deposited in the Washington housing trust fund as described in RCW 43.185.030 for each of the fiscal years ending June 30, 2007, June 30, 2008, June 30, 2009, and June 30, 2010.

NEW SECTION.  Sec. 3   A new section is added to chapter 43.185 RCW to read as follows:
     The application process and distribution procedure for the allocation of funds described in RCW 82.45.060(2) are the same as the existing competitive application process and distribution procedure for the housing trust fund, described in this chapter, except for the funds applied to the homeless family services fund and dollars appropriated to grower-provided on-farm housing for low-income migrant, seasonal, or temporary farm workers.

NEW SECTION.  Sec. 4   A new section is added to 2005 c 488 (uncodified) to read as follows:
FOR THE DEPARTMENT OF COMMUNITY, TRADE, AND ECONOMIC DEVELOPMENT
     Housing Assistance, Weatherization, and Affordable Housing--Home Security Fund (06-4-851)

     The appropriations in this section are subject to the following conditions and limitations:
     (1) $16,125,000 of the appropriation from the Washington housing trust account is provided solely for the backlog of projects eligible under chapter 43.185 RCW.
     (2) $1,125,000 of the appropriation from the Washington housing trust account is provided solely for weatherization administered through the energy matchmakers program.
     (3) $1,250,000 of the appropriation from the Washington housing trust account is provided solely to promote development of safe and affordable housing units for persons eligible for services from the division of developmental disabilities within the department of social and health services.
     (4) $500,000 of the appropriation from the Washington housing trust account is provided solely for shelters, transitional housing, or other housing facilities for victims of domestic violence.
     (5) $4,000,000 of the appropriation from the Washington housing trust account is provided solely for: (a) Facilities housing low-income migrant, seasonal, or temporary farm workers; (b) a loan program to assist growers in financing the development of grower-provided on-farm housing units for low-income migrant, seasonal, or temporary farm workers; and (c) health and safety projects to the extent qualified projects are submitted.
     (6) $1,000,000 of the appropriation from the Washington housing trust account is provided solely for mobile home preservation.
     (7) $1,000,000 of the appropriation from the homeless families services fund is provided solely for the purposes defined in RCW 43.330.167, but limited to residents living in housing subject to a regulatory agreement related to income and/or income restrictions.
     (8) Appropriations in this section shall be included in the calculation of annual funds available for determining the administrative costs authorized under RCW 43.185.050.

Appropriation:
     Washington Housing Trust Account--State . . . . . . . . . . . . $24,000,000
     Homeless Families Services Account--State . . . . . . . . . . . . $1,000,000
          Subtotal Appropriation . . . . . . . . . . . . $25,000,000

     Prior Biennia (Expenditures) . . . . . . . . . . . . $0
     Future Biennia (Projected Costs) . . . . . . . . . . . . $75,000,000
          TOTAL . . . . . . . . . . . . $100,000,000

Sec. 5   2005 c 488 s 927 (uncodified) is amended to read as follows:
FOR THE STATE TREASURER--TRANSFERS
     Local Toxics Control Account: For transfer
to the state toxics control account . . . . . . . . . . . . $13,900,000
     Washington Housing Trust Account: For transfer to the homeless families services account . . . . . . . . . . . . $1,000,000

Sec. 6   RCW 43.135.035 and 2005 c 72 s 2 are each amended to read as follows:
     (1) After July 1, 1995, any action or combination of actions by the legislature that raises state revenue or requires revenue-neutral tax shifts may be taken only if approved by a two-thirds vote of each house, and then only if state expenditures in any fiscal year, including the new revenue, will not exceed the state expenditure limits established under this chapter. However, for legislation enacted between the effective date of this 2005 act and June 30, 2007, any action or combination of actions by the legislature that raises state revenue or requires revenue-neutral tax shifts may be taken with the approval of a majority of members elected to each house, so long as state expenditures in any fiscal year, including the new revenue, will not exceed the state expenditure limits established under this chapter.
     (2)(a) If the legislative action under subsection (1) of this section will result in expenditures in excess of the state expenditure limit, then the action of the legislature shall not take effect until approved by a vote of the people at a November general election. The state expenditure limit committee shall adjust the state expenditure limit by the amount of additional revenue approved by the voters under this section. This adjustment shall not exceed the amount of revenue generated by the legislative action during the first full fiscal year in which it is in effect. The state expenditure limit shall be adjusted downward upon expiration or repeal of the legislative action.
     (b) The ballot title for any vote of the people required under this section shall be substantially as follows:

     "Shall taxes be imposed on . . . . . . . in order to allow a spending increase above last year's authorized spending adjusted for inflation and population increases?"

     (3)(a) The state expenditure limit may be exceeded upon declaration of an emergency for a period not to exceed twenty-four months by a law approved by a two-thirds vote of each house of the legislature and signed by the governor. The law shall set forth the nature of the emergency, which is limited to natural disasters that require immediate government action to alleviate human suffering and provide humanitarian assistance. The state expenditure limit may be exceeded for no more than twenty-four months following the declaration of the emergency and only for the purposes contained in the emergency declaration.
     (b) Additional taxes required for an emergency under this section may be imposed only until thirty days following the next general election, unless an extension is approved at that general election. The additional taxes shall expire upon expiration of the declaration of emergency. The legislature shall not impose additional taxes for emergency purposes under this subsection unless funds in the education construction fund have been exhausted.
     (c) The state or any political subdivision of the state shall not impose any tax on intangible property listed in RCW 84.36.070 as that statute exists on January 1, 1993.
     (4) If the cost of any state program or function is shifted from the state general fund on or after January 1, 1993, to another source of funding, or if moneys are transferred from the state general fund to another fund or account, the state expenditure limit committee, acting pursuant to RCW 43.135.025(5), shall lower the state expenditure limit to reflect the shift. For the purposes of this section, a transfer of money from the state general fund to another fund or account includes any state legislative action taken that has the effect of reducing revenues from a particular source, where such revenues would otherwise be deposited into the state general fund, while increasing the revenues from that particular source to another state or local government account. This subsection does not apply to the dedication or use of lottery revenues under RCW 67.70.240(3) or property taxes under RCW 84.52.068, in support of education or education expenditures. This subsection does not apply to the diversion of real estate excise tax revenues under RCW 82.45.060(2), in support of affordable housing or affordable housing expenditures.
     (5) If the cost of any state program or function is shifted to the state general fund on or after January 1, 2000, from another source of funding, or if moneys are transferred to the state general fund from another fund or account, the state expenditure limit committee, acting pursuant to RCW 43.135.025(5), shall increase the state expenditure limit to reflect the shift.

Sec. 7   RCW 43.135.035 and 2005 c 72 s 5 are each amended to read as follows:
     (1) After July 1, 1995, any action or combination of actions by the legislature that raises state revenue or requires revenue-neutral tax shifts may be taken only if approved by a two-thirds vote of each house, and then only if state expenditures in any fiscal year, including the new revenue, will not exceed the state expenditure limits established under this chapter.
     (2)(a) If the legislative action under subsection (1) of this section will result in expenditures in excess of the state expenditure limit, then the action of the legislature shall not take effect until approved by a vote of the people at a November general election. The state expenditure limit committee shall adjust the state expenditure limit by the amount of additional revenue approved by the voters under this section. This adjustment shall not exceed the amount of revenue generated by the legislative action during the first full fiscal year in which it is in effect. The state expenditure limit shall be adjusted downward upon expiration or repeal of the legislative action.
     (b) The ballot title for any vote of the people required under this section shall be substantially as follows:

     "Shall taxes be imposed on . . . . . . . in order to allow a spending increase above last year's authorized spending adjusted for personal income growth?"

     (3)(a) The state expenditure limit may be exceeded upon declaration of an emergency for a period not to exceed twenty-four months by a law approved by a two-thirds vote of each house of the legislature and signed by the governor. The law shall set forth the nature of the emergency, which is limited to natural disasters that require immediate government action to alleviate human suffering and provide humanitarian assistance. The state expenditure limit may be exceeded for no more than twenty-four months following the declaration of the emergency and only for the purposes contained in the emergency declaration.
     (b) Additional taxes required for an emergency under this section may be imposed only until thirty days following the next general election, unless an extension is approved at that general election. The additional taxes shall expire upon expiration of the declaration of emergency. The legislature shall not impose additional taxes for emergency purposes under this subsection unless funds in the education construction fund have been exhausted.
     (c) The state or any political subdivision of the state shall not impose any tax on intangible property listed in RCW 84.36.070 as that statute exists on January 1, 1993.
     (4) If the cost of any state program or function is shifted from the state general fund or a related fund to another source of funding, or if moneys are transferred from the state general fund or a related fund to another fund or account, the state expenditure limit committee, acting pursuant to RCW 43.135.025(5), shall lower the state expenditure limit to reflect the shift. For the purposes of this section, a transfer of money from the state general fund or a related fund to another fund or account includes any state legislative action taken that has the effect of reducing revenues from a particular source, where such revenues would otherwise be deposited into the state general fund or a related fund, while increasing the revenues from that particular source to another state or local government account. This subsection does not apply to the dedication or use of lottery revenues under RCW 67.70.240(3) or property taxes under RCW 84.52.068, in support of education or education expenditures. This subsection does not apply to the diversion of real estate excise tax revenues under RCW 82.45.060(2), in support of affordable housing or affordable housing expenditures.
     (5) If the cost of any state program or function and the ongoing revenue necessary to fund the program or function are shifted to the state general fund or a related fund on or after January 1, 2007, the state expenditure limit committee, acting pursuant to RCW 43.135.025(5), shall increase the state expenditure limit to reflect the shift.

NEW SECTION.  Sec. 8   A new section is added to chapter 43.185 RCW to read as follows:
     The department must report upon the accomplishments of this chapter to the appropriate committees of the legislature by December 31, 2010. Performance measures must be determined by the department, with required input from the appropriate committees of the legislature, by December 31, 2006.

NEW SECTION.  Sec. 9   Section 6 of this act expires July 1, 2007.

NEW SECTION.  Sec. 10   Section 7 of this act takes effect July 1, 2007.

NEW SECTION.  Sec. 11   Sections 1 through 5 and 7 through 9 of this act expire July 1, 2010.

NEW SECTION.  Sec. 12   Except for section 7 of this act, this act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately.