H-2154

AN ACT Relating to preservation of moderate-income housing; amending RCW 43.185A.030, 43.185A.040, and 43.185A.050; adding new sections to chapter 43.185A RCW; adding a new section to chapter 43.63A RCW; and creating a new section.

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

NEW SECTION. Sec. 1. The legislature finds that there is a severe shortage of affordable housing within metropolitan areas of the state of Washington. The legislature further finds that a dual strategy is needed that encourages both the development of additional units of affordable housing and the preservation of the existing supply of affordable housing. The legislature further finds that preservation is a cost-effective alternative to displacement caused by rising rental costs in metropolitan areas.

It is the intent of this act to assist in the development and preservation of multifamily rental housing that serves primarily households earning between fifty percent and eighty percent of the county median income, adjusted for household size, and to minimize the involuntary displacement of tenants.

Sec. 2. RCW 43.185A.030 and 1994 c 160 s 3 are each amended to read as follows:

(1) Using moneys specifically appropriated for such purpose, the department shall finance in whole or in part projects that will provide housing for low-income households.

(2) Activities eligible for assistance include, but are not limited to:

(a) New construction, rehabilitation, or acquisition of housing for low-income households;

(b) Rent subsidies in new construction or rehabilitated multifamily units;

(d) Mortgage subsidies for new construction or rehabilitation of eligible multifamily units; ((~~and~~))

(e) Mortgage insurance guarantee or payments for eligible projects; and

(f) Technical assistance, design and finance services and consultation, and administrative costs for eligible nonprofit community or neighborhood-based organizations.

(3) Legislative appropriations from capital bond proceeds may be used only for the costs of projects authorized under subsection (2) (a), (c), (d), ((~~and~~)) (e), and (f) of this section, and not for the administrative costs of the department.

(4) Moneys from repayment of loans from appropriations from capital bond proceeds may be used for all activities necessary for the proper functioning of the affordable housing program except for activities authorized under subsection (2)(b) of this section.

(5) Administrative costs of the department shall not exceed four percent of the annual funds available for the affordable housing program.

Sec. 3. RCW 43.185A.040 and 1994 c 160 s 4 are each amended to read as follows:

Organizations that may receive assistance from the department under this chapter are local governments, local housing authorities, nonprofit community or neighborhood-based organizations, federally recognized Indian tribes in the state of Washington, ((~~and~~)) regional or state-wide nonprofit housing assistance organizations, and limited partnerships established for the provision of low-income housing, where the nonprofit or a public corporation or other entity identified in this section is a general partner, or a limited liability company, established for the provision of low-income housing, where the eligible nonprofit entity is a managing member.

Eligibility for assistance from the department under this chapter also requires compliance with the revenue and taxation laws, as applicable to the recipient, at the time the grant is made.

NEW SECTION. Sec. 4. A new section is added to chapter 43.185A RCW to read as follows:

The department in awarding funds for activities eligible under RCW 43.185A.030 shall:

(1) Give priority to eligible nonprofit community or neighborhood-based organizations that will operate the housing as housing for households with incomes between fifty percent and eighty percent of the county median income, adjusted for household size, for a period of at least fifty years and will agree to a written covenant agreeing to keep rents affordable to the households;

(2) Give priority to multifamily rental housing projects that are located in metropolitan areas that have experienced sharp increases in rents; and

(3) Give priority to those multifamily rental housing projects that encourage economically integrated housing that includes units occupied by households with income at or below fifty percent of the median family income for the county where the housing development is located.

Sec. 5. RCW 43.185A.050 and 1991 c 356 s 14 are each amended to read as follows:

(1) During each calendar year in which funds are available for use by the department for the affordable housing program, the department shall announce to all known interested parties, and through major media throughout the state, a grant and loan application period of at least ninety days' duration. This announcement shall be made as often as the director deems appropriate for proper utilization of resources. The department shall then promptly grant as many applications as will utilize available funds less appropriate administrative costs of the department, not to exceed five percent of moneys appropriated to the affordable housing program.

(2) The department shall develop, with advice and input from the ((~~low-income [housing] assistance advisory committee established in RCW 43.185.110~~)) affordable housing advisory board established in RCW 43.185B.020, criteria to evaluate applications for assistance under this chapter, subject to at least one public hearing.

NEW SECTION. Sec. 6. A new section is added to chapter 43.185A RCW to read as follows:

The affordable housing equity trust fund is created in the state treasury. All receipts from appropriations by the legislature, private contributions, repayment of loans made from this fund, and all other sources must be deposited into this fund. Moneys in the fund may be spent only after appropriation. Expenditures from the fund must be used for the purposes of this chapter.

NEW SECTION. Sec. 7. A new section is added to chapter 43.63A RCW to read as follows:

(1) The department may provide technical assistance to organizations eligible for assistance under chapter 43.185A RCW to encourage the development or preservation of multifamily housing developments as housing for moderate-income households, including assistance to nonprofit tenant organizations who wish to convert the multifamily housing development in which they reside to tenant ownership. Technical assistance does not include details connected with the sale or conversion of a multifamily housing development which would require the department to act in a representative capacity.

(2) The department shall give priority for technical assistance under this section to those projects that encourage economically integrated housing that includes units occupied by households with incomes at or below fifty percent of the median family income for the county where the housing development is located.

(3) The department shall work with the Washington state housing finance commission to leverage moneys from the affordable housing equity trust fund created in section 6 of this act, with financing available through the Washington state housing finance commission and other public and private financing sources.