SENATE BILL REPORT

2SHB 2405

BYHouse Committee on Appropriations (originally sponsored by Representatives Rector, Winsley, Nutley, Padden, Anderson, Leonard, Jacobsen, Dellwo, Wang, Brekke, Todd, Moyer, Inslee, Scott, Valle, Wood, Phillips and O'Brien)

Establishing the homelessness prevention program.

House Committe on Housing

Rereferred House Committee on Appropriations

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 16, 1990; February 21, 1990

Majority Report:  Do pass as amended.

      Signed by Senators Lee, Chairman; Anderson, Vice Chairman; McMullen, Murray, Smitherman, Warnke, West, Williams.

Senate Staff:Patrick Woods (786-7430)

                  February 21, 1990

Senate Committee on Ways & Means

Senate Hearing Date(s):February 26, 1990

Senate Staff:Mary Poole (786-7613)

                  February 24, 1990

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 21, 1990

BACKGROUND:

The homeless population has increased throughout the state.  A recent survey conducted by the University of Washington, for the state Department of Community Development, found that a large percentage of the homelessness occurs as a result of a sudden job loss or other economic adversity.  This group of homeless individuals only need temporary housing assistance until a new job is found or the economic crisis is addressed.

The majority of current federal and state programs focus on activities that assist persons once they have become homeless.  Some programs do allow the use of a percentage of the funds for homelessness prevention.  This is usually limited to a one-time payment for back rent or a mortgage payment.

In 1986, the Legislature established the Housing Trust Fund.  The purpose of the program was to provide a source of funds to local governments, nonprofit organizations, and public housing authorities to assist in the development of housing for persons and families with special housing needs and with incomes at or below 50 percent of the county median income.  The state Department of Community Development (DCD) is responsible for the administration of the Housing Trust Fund.

Currently, DCD accepts applications from local governments, nonprofit organizations, and public housing authorities.  The funds can be used to finance a variety of activities to make housing affordable to low-income individuals and those with special housing needs.  DCD is required to rate and give preference to applications based on:  (a) the leveraging of other funds; (b) applicant contributions; (c) local government contributions; (d) projects that encourage ownership, management, and other project-related opportunities; (e) housing available to low-income persons for at least 15 years; (f) applicant's ability, stability, and resources to implement the project; (g) greatest need served; and (h) housing for the lowest income.

The Housing Trust Fund preference criteria that rates applications on the degree of leverage of other funds and the 15 year occupancy for low-income persons has the effect of eliminating homelessness prevention programs as fundable projects.

The housing trust fund is currently required to allocate 30 percent of its funds to rural areas of the state.  The present definition of "rural" is considered to be overly restrictive.

SUMMARY:

The Homelessness Prevention Pilot Program is established in the state Department of Community Development.  The department is directed to select at least three eligible organizations to implement homelessness prevention programs at the local level.  Grants and technical assistance, through the Washington housing trust fund, will be made available to eligible organizations to implement local homelessness prevention programs.  Eligible organizations are defined as local governments, nonprofit organizations, and public housing authorities.

The assistance through the state's pilot program must be used to: provide interest free loans of temporary rental or mortgage assistance to families in immediate danger of losing their housing as a result of insufficient income to pay housing costs; and provide technical assistance to eligible organizations to develop and implement local strategies to prevent homelessness.

In selecting eligible organizations for participation in the homelessness prevention pilot program, the department must consider the organization's ability, stability, and resources to implement the local program, and their efforts to coordinate other necessary support for families with children.  The department is required to provide for a geographic distribution of local homelessness prevention programs throughout the state.

The recipient eligible organization is required to establish priorities of eligibility for temporary mortgage or rental assistance and to determine eligibility to participate regarding the income of families with children.  The determination of eligibility must include a determination that the family is subject to eviction due to nonpayment of rent or foreclosure for nonpayment of mortgage installments.  This determination must be based on illness, unemployment, underemployment, or any other failure of resources beyond the person's control.  The recipient eligible organizations must also verify the loss of income and determine the family does not have adequate resources to make the required housing payment.  No family can continue to receive assistance through the local homelessness prevention program if other federal, state, or local rental or mortgage assistance becomes available.

The Department of Community Development is required to adopt rules to implement the Homelessness Prevention Pilot Program. The rules must include but are not limited to:  the maximum length of available assistance to families with children; the eligibility and application process for eligible organizations; the criteria to award grants and technical assistance to eligible organizations;  and the criteria eligible organizations must use when entering into contracts with families with children to make mortgage or rental assistance payments on their behalf.

The Housing and Trust Fund program is amended to include the activities of the Homelessness Prevention Pilot Program as an eligible activity, and exempt the leverage and 15 year occupancy requirements on applications from eligible organizations that request participation as a local homelessness prevention pilot program.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

SUMMARY OF PROPOSED SENATE AMENDMENTS:

The Department of Community Development (DCD) is authorized to use a more comprehensive version of the federal definition of "rural."

Activities eligible for assistance through the housing trust fund are expanded to include temporary rental and mortgage payment subsidies used to prevent homelessness.

The priority for applications for projects and activities that use privately owned housing stock is expanded to include privately owned housing stock purchased by a public housing authority.  The definition of privately owned housing stock includes housing acquired by a federal agency through default on a mortgage by the private owner

The Department of Community Development does not have to use all of the evaluation criteria when reviewing projects and activities requesting assistance through the housing trust fund.  Similar activities and projects must be evaluated using the same criteria.

The housing trust fund is encouraged to provide loans for eligible housing projects.

Senate Committee - Testified: ECONOMIC DEVELOPMENT & LABOR:  Jan Drago, Seattle Mayor's Homeless Task Force (pro); Joel Goldstein, City of Seattle/Salvation Army Homeless Family Assistance Project (pro); Bill Pupo, City of Spokane (pro); Mary Murphy, League of Women Voters (pro); Mike Ryherd, Low Income Housing Congress (pro); Jeff Robinson, DCD (pro)