Creates the transitional housing operating and rent program in the department to assist homeless individuals and families secure and retain safe, decent, and affordable housing. The department shall provide grants to eligible organizations, as described in RCW 43.185.060, to provide assistance to program participants. The eligible organizations must use grant moneys for: (1) Rental assistance, which includes security or utility deposits, first and last month's rent assistance, and eligible moving expenses to be determined by the department;

(2) Case management services designed to assist program participants to secure and retain immediate housing and to transition into permanent housing and greater levels of self-sufficiency;

(3) Operating expenses of transitional housing facilities that serve homeless families with children; and

(4) Administrative costs of the eligible organization, which must not exceed limits prescribed by the department.

Provides that, beginning in 2009, all organizations funded through the program receiving over five hundred thousand dollars a year during the previous calendar year from: This program; other state housing related funding sources, including the housing trust fund; housing finance commission programs; and the ending homelessness program surcharge in RCW 36.22.179 and the surcharges in RCW 36.22.178, shall apply to the full examination Washington state quality award program once every three years beginning by January 1, 2010.

Appropriates the sum of seven million five hundred thousand dollars, or as much thereof as may be necessary, for the fiscal year ending June 30, 2008, from the general fund to the transitional housing operating and rent account created in this act for the purpose of implementing and operating the transitional housing operating and rent program.

Appropriates the sum of seven million five hundred thousand dollars, or as much thereof as may be necessary, for the fiscal year ending June 30, 2009, from the general fund to the transitional housing operating and rent account created in this act for the purpose of implementing and operating the transitional housing operating and rent program.