SENATE BILL REPORT

EHB 1553

BYRepresentatives Nutley, J. Williams, Leonard, Sanders and Padden

Limiting grants and loans from the housing trust fund.

House Committe on Housing

Rereferred House Committee on Ways & Means/Appropriations

Senate Committee on Ways & Means

Senate Hearing Date(s):February 29, 1988

Majority Report:  Do pass as amended.

      Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Bauer, Bluechel, Deccio, Fleming, Gaspard, Hayner, Johnson, Lee, Moore, Saling, Smith, Talmadge, Vognild, Warnke, Williams, Wojahn, Zimmerman.

Senate Staff:William Bafus (786-7715)

                  February 29, 1988

AS REPORTED BY COMMITTEE ON WAYS & MEANS, FEBRUARY 29, 1988

BACKGROUND:

The Washington Housing Trust Fund (Trust Fund) was created in 1986 to assist in meeting the basic housing needs of low- income persons, persons in rural areas and persons with special housing needs.  The Department of Community Development (DCD) is responsible for the administration of the trust fund program.

The Legislature authorized initial funding, through interest on short-term and nominal real estate earnest money deposits, for the trust fund to start on January 1, 1988.  Additional funding through the capital construction budget is authorized to start on July 1, 1988.

The present law authorizes DCD to use up to five percent of the annual revenue in the trust fund account for its administrative costs.  The current revenue level in the housing trust fund account is inadequate to fund the administrative costs to operate the program.  As additional annual revenue is generated from the funding sources, the 5 percent limit on administrative cost will be adequate.

SUMMARY:

The 5 percent limit on administrative costs in the Washington State Housing Trust Fund is removed for a two year period.  To provide the necessary funds for program start-up, the Department of Community Development (DCD) is authorized to utilize up to thirty-seven thousand five hundred dollars in the fiscal year ending June 30, 1988 and up to seventy-five thousand dollars in the fiscal year ending June 30, 1989, from annual revenues in the trust fund.

Beginning in fiscal year 1990, the 5 percent limit on administrative costs, based on annual revenues in the trust fund account, is back in effect.

SUMMARY OF PROPOSED SENATE AMENDMENT:

One-half of unclaimed state lottery prizes, up to a maximum of $1 million per year, are deposited in the Housing Trust Fund.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Effective Date:The bill contains an emergency clause and takes effect immediately.  The transfer of unclaimed state lottery prizes is effective July 1, 1988.

Senate Committee - Testified: Representative Nutley (for); Sylvie McGee, Washington Coalition for the Homeless (for)