Homeless Housing and Assistance Surcharges.
The state and local homeless housing programs receive funding from the homeless housing and assistance surcharges collected by each county auditor when a document is recorded. The following surcharges related to affordable housing and homeless services are collected by the county, with shares of the funds distributed to the county and to the state:
Affordable Housing for All Surcharge.
Of the $13 surcharge, approximately 60 percent is retained by the county for local affordable housing and assistance and approximately 40 percent is distributed to the state. The state's share of $10 of the fee is deposited into the Affordable Housing for All Account, to be used by the Department of Commerce (COM) for housing and shelter for extremely low-income households. The state's share of $3 of the fee is deposited into the Landlord Mitigation Program Account to provide financial support to landlords of tenants who receive rental assistance.
Local Homeless Housing and Assistance Surcharge.
Of the $62 surcharge, approximately 66 percent is retained by the county for local homeless housing and assistance. The remainder is distributed to the state for deposit in the Home Security Fund and is used by the COM to manage the State Homeless Housing Program, issue private rental housing payments, and provide housing and shelter support.
Additional Local Homeless Housing and Assistance Surcharge.
Of the $8 surcharge, approximately 90 percent is retained by the county for local homeless housing and assistance and 10 percent is distributed to the state for deposit in the Home Security Fund. The funds distributed to the state may be used by the COM for managing the state's homeless housing programs.
State Rental Assistance.
The COM administers various rental assistance programs, including the Eviction Rental Assistance Program (ERAP). The ERAP was established by the COM in 2020, using federal funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Landlord Mitigation Program.
The Landlord Mitigation Program (LMP) is administered by the COM. The LMP can provide landlords of tenants who receive a housing subsidy with up to $1,000 in reimbursement for move-in upgrades, up to 14 days of lost rent, and up to $5,000 for damage caused by a tenant. The maximum a landlord can receive from all combined claims under the LMP is $5,000.
Permanent Supportive Housing.
Permanent Supportive Housing (PSH) is defined as subsidized, leased housing with no limit on the length of stay that prioritizes people who need comprehensive support services to retain tenancy. Permanent Supportive Housing uses admissions practices designed to lower barriers to entry that would be typical for other rental housing, especially related to rental history, criminal history, and personal behaviors. Permanent Supportive Housing is paired with voluntary on or off-site supportive services.
An additional surcharge of $100 must be collected by a county auditor for each document recorded, with some exceptions. The funds collected must be fully remitted to the state to be distributed as follows:
Eviction Prevention Rental Assistance Program.
The Eviction Prevention Rental Assistance Program (EPRAP) is created and is to be administered by the COM to prevent evictions by providing resources to households most likely to become homeless or to suffer severe health consequences, or both, after an eviction while prioritizing households disproportionately impacted by public health emergencies, homelessness, and housing instability.
The COM must provide grants to eligible organizations to provide assistance to program participants. Eligible organizations are defined as local governments, local housing authorities, behavioral health administrative services organizations, nonprofit community or neighborhood-based organizations, federally recognized tribes, and regional or statewide nonprofit housing assistance organizations. The COM must award grant funds in a manner that is proportional to the amount of revenue collected from the $100 surcharge in the county that is being served by the grantee. A grantee that is a county may refuse the grant funds within a timeframe established by the COM. If the county refuses the funds or doesn't respond within the timeframe, the COM must identify an alternative grantee.
Eligible organization grantees must work with organizations rooted in communities of color to assist and serve marginalized populations within their communities. At least 10 percent of the grant total must be subgranted to organizations that serve and are substantially governed by marginalized populations. A grantee may request an exemption from the subgrant requirement if they are unable to subgrant with an organization that serves and is substantially governed by marginalized populations or if the grantee provides the COM with a plan to spend 10 percent of the grant total in a manner that the COM determines will improve racial equity for historically underserved communities more effectively than a subgrant.
Grant funds must be used for rent assistance, utility assistance, and administrative costs of the eligible organization. Households eligible to receive assistance are those:
The COM must ensure equity in the program by developing performance measures and benchmarks that promote equitable program access and equitable program outcomes. Performance measures and benchmarks must be developed by the COM in consultation with stakeholder groups. The measures and benchmarks must ensure the race and ethnicity of households served under the program are proportional to the numbers of people at risk of homelessness in each county for various racial groups.
The COM report must include a report on the expenditures, performance, and outcomes of the EPRAP in its annual update on the state's homeless housing strategic plan. The report must include the number of households served in the following categories: adults without children; households with children; unaccompanied youth; and young adults.
The substitute bill:
(In support) Rental relief programs are effective. It can help people pay off other debts and become financially stable. The COVID-19 pandemic has increased the need for rent assistance and there is not enough funding available to meet that need. Providing rent assistance is a racial justice issue. Renters of color are more likely to experience housing instability. Some tenants have to choose between paying for a car, rent, or groceries. The eviction moratorium has saved some families, but more help is needed. Preventing evictions will keep tenants housed and will prevent homelessness. Once a buyer of a home becomes educated about what the fee is for, they are glad to assist their most vulnerable neighbors. A healthy neighborhood creates a healthy community. The COVID-19 pandemic has required people to shelter in place but when someone is homeless it is impossible to do so. A survey of some homebuyers who purchased a home in the last year showed strong support for this type of fee. The COVID-19 pandemic has made things so much harder for many Washingtonians. Cities believe our state is on the precipice of a crisis. One in four renters in December indicated little to no confidence in being able to make their next month's rent and a major wave of evictions is imminent. The homelessness response system was strained before COVID-19 and without additional resources the system is at risk of failure. It is hard to imagine how the eviction moratorium can be wound down without major rent assistance. Because of the timing of the collection of these fees, an immediate investment is needed in the state operating budget before these fees are available. Housing stability is a determinate of well being. Lawmakers should focus on preventing eviction to support mental health and prevent homelessness. Federal funds for rent assistance from the CARES Act have long been exhausted. Real estate transaction fees should be increased to create a permanent rental assistance fund. People of color are more likely to be renters and white people are more likely to be homeowners. Without adequate rental assistance and meaningful tenant protections, thousands of renters will be displaced from their homes. Thousands of Washington renters who were able to meet their rent in December relied on unsustainable sources to pay it, such as using credit cards or their savings. This policy will create a new and permanent source of funding to target people who may be on the brink of homelessness. The additional $500 million in federal assistance our state is expecting for rental assistance will not be adequate. The additional $100 million per year that this fee will generate for rent assistance is needed.
(Other) This bill prioritizes the need for homeless services rather than rental assistance. Rental assistance should be prioritized over all other needs. Rental assistance is the best way to stabilize housing. A more narrow definition of "eligible grantee" would improve the bill, as would a maximum cap on administrative costs. A sunset review in two years would provide an opportunity to reallocate funds amongst the allowed uses under the bill. These policies will help prevent evictions at a scale that will make a real difference, expanding permanent supportive housing, and funding the landlord mitigation program in a sustainable manner. The COM appreciates the flexible eligible activities under the bill, which will allow reprioritization of the funds based on future needs.