SENATE BILL REPORT
SHB 1250
As of March 7, 2023
Title: An act relating to modifying the low-income home rehabilitation program.
Brief Description: Modifying the low-income home rehabilitation program.
Sponsors: House Committee on Capital Budget (originally sponsored by Representatives Steele and Eslick).
Brief History: Passed House: 2/28/23, 97-0.
Committee Activity: Housing: 3/10/23.
Brief Summary of Bill
  • Converts the Low-Income Home Rehabilitation Revolving Loan Program into a grant program and forgives the outstanding balance of existing loans.
SENATE COMMITTEE ON HOUSING
Staff: Melissa Van Gorkom (786-7491)
Background:

The Department of Commerce (Commerce) administers the Low-Income Home Rehabilitation Revolving Loan Program (Loan Program), subject to amounts appropriated.  Under the Loan Program, rural homeowners who earn less than 200 percent of the federal poverty level are eligible to receive a loan for residential repairs and improvements that address health, safety, and durability issues in existing homes.  Senior citizens, persons with disabilities, families with children under the age of five, and veterans must receive priority for the loans. 


The loan cannot exceed 80 percent of the assessed value after rehabilitation or $40,000, whichever is less.  Any amounts due under the loan become due and payable when the home is sold or upon change of ownership of the home. 


Commerce contracts with rehabilitation agencies to provide home rehabilitation to participating homeowners and administer the loans with preference provided to local agencies delivering programs and services with similar eligibility criteria.  A rehabilitation agency may charge a homeowner an administrative fee of no more 7 percent of the rehabilitation loan amount.  Any rehabilitation agency receiving funding through the Loan Program must report the project costs and the number of homes repaired or rehabilitated to Commerce at least quarterly, or in alignment with federal reporting, whichever is the greater frequency. 


The Low-Income Home Rehabilitation Revolving Loan Program Account (Account) is a non-appropriated account that may receive repayments from the Loan Program and other sources of funding.  Expenditures from the Account may only be used for purposes of the Loan Program. 

Summary of Bill:

The Loan Program is terminated on July 1, 2023.  Commerce must forgive in full any remaining amounts owed on previously issued loans.  Loan forgiveness is not retroactive and does not apply to any loans previously paid in full. 


The Low-Income Home Rehabilitation Grant Program (Grant Program) is established, subject to appropriations, and administered by Commerce.  Under the Grant Program homeowners who live in rural areas and have incomes at or below 200 percent of the federal poverty level, 80 percent of the area median income for the county in which the home receiving rehabilitation is located, or 60 percent of the state median income, whichever is greater would be eligible to receive a grant for residential repairs and improvements that address health, safety, and durability issues in existing homes.  Senior citizens, persons with disabilities, families with children under the age of five, and veterans must receive priority for the grants. 


The cost of the home rehabilitation must be the lesser of 80 percent of the assessed or appraised value of the property post rehabilitation, whichever is greater; or $50,000.  

 

Commerce must contract with rehabilitation agencies to provide home rehabilitation to participating homeowners and administer the grants with preference provided to local agencies delivering programs and services with similar eligibility criteria.  Any rehabilitation agency receiving funding through the Grant Program must report the project costs and the number of homes repaired or rehabilitated to Commerce at least quarterly or in alignment with federal reporting, whichever is the greater frequency. 


The Account is renamed as the Low-Income Home Rehabilitation Account.  Expenditures may be used for the Grant Program and wind-down costs of the Loan Program.

Appropriation: The bill contains a section or sections to limit implementation to the availability of amounts appropriated for that specific purpose.
Fiscal Note: Available.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: The bill contains several effective dates. Please refer to the bill.