Homelessness & housing toolkit for cities Tools and resources to address homelessness and a ordable housing from real cases in cities across Washington. 2020 Copyright © 2019 by Association of Washington Cities and Municipal Research & Services Center

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the Association of Washington Cities or Municipal Research & Services Center.

AWC’s mission is to serve our members through advocacy, education and services.

Association of Washington Cities, Inc. 1076 Franklin St. SE, Olympia, WA 98501 360.753.4137 1.800.562.8981 wacities.org

MRSC’s mission: Trusted guidance and service supporting local government success.

Municipal Research & Services Center 2601 Fourth Avenue, Suite 800 Seattle, WA 98121-1280 206.625.1300 mrsc.org Table of contents

New state law incentivizes increased residential Introduction building capacity & density...... 26 City resources for addressing homelessness & Revising city regulations to encourage affordable housing...... 1 accessory dwelling units...... 28 A Regional Coalition for Housing (ARCH): Funding 15 cities & a county working together...... 30 Homelessness & affordable housing City of Bellingham housing levy...... 31 funds explained...... 2 Community Land Trusts...... 32 Homelessness Inclusionary zoning: Mandatory programs...... 33 Multifamily tax exemption: An incentive Using mitigation sites to address emergency to help create affordable housing...... 35 homelessness...... 6 Bremerton addresses housing affordability Emergency rental assistance programs: & chronic homelessness...... 36 A strategy for preventing homelessness...... 8 Down payment assistance programs...... 37 Long-term “master leasing” helps provide homeless housing...... 9 Tiny homes...... 38 Homelessness & the limits of enforcement...... 10 The Housing First model...... 12 Tenant protections Rental housing inspection programs...... 39 Tiny house villages: Quixote Village & Emerald Village...... 13 New tenant protection laws...... 40 Local governments’ winter shelter programs...... 15 Innovative collaboration Affordable housing Addressing chronic homelessness in Everett with CHART...... 41 How cities can make use of up to 20 years of affordable housing shared revenue...... 16 Lakewood nonprofits & government tackle affordability & homelessness together...... 42 Finding missing middle housing...... 18 Taking a team approach to help people struggling New resources available for Housing with homelessness & behavioral health...... 44 Action Plans...... 22 Wenatchee coordinates homeless Multifamily housing bonds...... 23 programs for two counties...... 45 Land Acquisition Program...... 25 Introduction City resources for addressing homelessness & affordable housing

Cities of every size are grappling Our inadequate mental health There is no single solution to these with increasing homelessness, lack care and chemical dependency problems and cities need a variety of affordable housing for low-wage treatment systems compound of strategies to address these crises. workers and their families, and the problem. Washington ranks This toolkit is meant to serve as a inadequate mental health and 46th in the nation in the number resource for elected officials and city addiction treatment systems. of psychiatric beds available for staff who seek options and ideas on those suffering from mental illness, how to respond. After many years of decline, and our emergency rooms are homelessness in Washington is overwhelmed by the number of The following pages offer growing again, despite significant people who need help. Opioid descriptions of a variety of tools investment and efforts to reduce it overdoses are now the leading and programs. For each article you over the last decade. cause of accidental death in the U.S. will find a brief description of the with 70,237 deaths in 2017. Both topic and information on where to Some communities face rapidly methamphetamine and opioid access additional resources. increasing housing costs that are addiction are driving this epidemic pricing working families out of of addiction, which does not Cities are on the front lines of cities. When markets in larger urban discriminate when it comes to race, the challenges of housing and communities are red hot, there is sex, geography, or income level. homelessness, but as the programs powerful pressure to renovate and in this toolkit demonstrate, cities raise rents for existing affordable People with chemical dependency cannot solve them alone. Reducing units. Less urbanized areas of the and mental health problems are homelessness and increasing state face very low vacancy rates significantly more likely to be affordable housing requires a and soft development economies, homeless and homelessness is sustained, innovative approach where new construction is not likely to accelerate their downward and a willingness to partner occurring at the pace needed to spiral, adding isolation, trauma, with county, state, and federal meet demand and accommodate and premature aging to their list of agencies, and as well as local faith growth. disabling conditions. communities, nonprofits, and ordinary citizens. None of these Solving these problems fall to a programs are one-size-fits-all varied group of federal and state solutions, but the following pages agencies, local governments, will offer ideas and inspiration so and nonprofit partners. The cost cities can continue meeting the of homelessness to taxpayers is challenges of an ever-changing significant: increased police calls for world. service, incarceration, emergency room visits, and locally funded homeless services strain local budgets. Cities struggle with limited resources and, often, funding for homelessness and housing does not flow directly to cities.

1 Funding Homelessness & affordable housing funds explained

Cities of every size are grappling with increasing homelessness and a lack of affordable housing for low-wage workers and their families.

Part of the reason for this is that the financial returns from low-income housing development are not high enough for traditional banking institutions and housing developers to be incentivized to finance and construct housing for this economic segment. Housing developments are usually financed based on a high market rent or sale price that will guarantee the repayment of construction loans to banks and result in enough profit for housing developers to take on the many risks of development. Thus, most housing is constructed for those at or above median income levels.

Funds from public sources are often used to incentivize the construction of housing for low income populations. The resources below provide many relevant funding tools for dealing with homelessness and affordable housing finance.

Area median income Source Funding focus Housing-related use (AMI) restrictions Low Income Housing Tax Affordable Creation of new units 60% of the AMI or below Credits housing and homelessness Washington State Housing Affordable Preservation, creation of new units, and 80% of the AMI or below, Trust Fund housing and supportive services but majority of funds homelessness targeted to 30% of the AMI or below State Authorized Sales Tax Affordable Creation of new units and housing- 60% of the AMI or below housing related services Housing Choice Voucher Affordable Voucher subsidizing rent 50% of the AMI or below (Section 8) housing Community Development Affordable Rehabilitation of affordable housing 80% of the AMI or below Block Grant housing and homeownership programs for low- income households HOME Investment and Affordable Preservation, creation of new units, and 50% of the AMI or below Partnership Program housing rental assistance Affordable Housing Affordable Funds activities designated by the local 50% of the AMI or below Property Tax Levy housing affordable housing finance plan HB 1406 Affordable Allows cities and counties to access a 60% of the AMI or below housing portion of state sales tax revenue to make local investments in affordable housing HUD Continuum of Care Homelessness Homeless housing and services Program Document recording fees Homelessness Homeless housing, planning, and prevention Mental Illness and Drug Homelessness Services and supportive housing for Dependency Tax people with mental health or drug dependency issues

2 Low Income Housing Tax State authorized sales The Housing Choice Credit tax to support affordable Voucher (Section 8) The Low Income Housing Tax housing & related The Housing Choice Voucher Credit (LIHTC) is a federal tax credit (HCV) program is a federal housing program created in 1986 to provide services voucher for very low-income private owners an incentive to In July 2015, the Legislature families, the elderly, and disabled create and maintain affordable approved HB 2263, which gives individuals to afford housing in housing. The IRS allocates program local governments a tool to obtain the private market. Participants funds on a per capita basis to funding to house vulnerable are free to choose any housing each state. The Washington State residents by implementing a one- that meets the requirements of Housing Finance Commission tenth of one percent sales tax. the program and are not limited (HFC) administers the tax credits as to units located in subsidized a source of funding that housing County legislative authorities may housing projects. Housing choice developers use for a single project. implement a 0.1% sales and use vouchers are administered locally Investors in housing projects can tax (if approved by a majority of by public housing authorities. apply to the HFC for different tax voters) in order to fund housing and Housing authorities receive federal credits depending on project type. related services. A city legislative funds from the U.S. Department of authority may implement the Housing and Urban Development whole or remainder of the tax if it’s Washington State (HUD) to administer the voucher approved by a majority of voters program. Usually, a housing subsidy Housing Trust Fund and the county has not opted to is paid to the landlord directly by The Washington State Department implement the full tax. the housing authority on behalf of Commerce administers a of the participating family. The Housing Trust Fund (HTF) funded This new revenue stream is meant individual or family then pays the primarily through the capital to serve people living with incomes difference between the actual rent budget. Since 1987, the HTF has at 60% or below of a given county’s charged by the landlord and the area median income. The majority contributed over $1 billion toward amount subsidized by the program. the construction and maintenance of the funding (at least 60%) is of over 40,000 affordable homes. designated for building new HTF dollars support a wide range of affordable housing and facilities to Community Development projects serving a diverse array of deliver mental health services and/ Block Grants low-income populations. Projects or the operation and maintenance Started in 1974, the Community can serve people with incomes up of newly constructed affordable Development Block Grant (CDBG) to 80% of area median income, but housing or mental health services. program is one of HUD’s longest most projects funded to date serve The remainder of the funds can be running programs and provides households with special needs or used for the operation, delivery annual grants to local governments incomes below 30% of the area and evaluation of mental health and states for a wide range of median income, including homeless programs or housing-related community needs. The CDBG families, seniors, farmworkers, services. program works to ensure decent and people with developmental affordable housing, to provide disabilities. Local governments services to the most vulnerable in can apply to the HTF for eligible our communities, and to create activities. jobs through the expansion and retention of businesses.

3 CDBG appropriations are Affordable housing HB 1406 – State local allocated between states and property tax levy revenue sharing local jurisdictions called “non- Counties and cities are authorized Passed in 2019, HB 1406 creates a entitlement” and “entitlement” to impose additional regular sales tax revenue sharing program communities. Entitlement property tax levies up to $0.50 per that allows cities and counties to communities are comprised of thousand dollars assessed valuation access a portion of state sales tax central cities of Metropolitan (AV) each year for up to ten years to revenue to make local investments Statistical Areas, metropolitan cities finance affordable housing for very in affordable housing. Over a 20- with populations of at least 50,000, low-income households (defined year commitment, the state will and qualified urban counties as 50% or less of the county’s be sharing more than $500 million with a population of 200,000 or median income) when specifically with local governments. To take more (excluding the populations authorized to do so by a majority advantage of this funding source, of entitlement cities). States of voters of the taxing district (RCW cities and counties must pass a distribute CDBG funds to non- 84.52.105). resolution of intent by January 31, entitlement localities not qualified 2020 and adopt a tax ordinance by as entitlement communities. If both the city and county impose a July 27, 2020. levy, the levy of the last jurisdiction HOME Investment to receive voter approval is reduced HUD Continuum of Care so that the combined rate does not Partnerships Program Program The HOME Investment Partnerships exceed $0.50 per thousand dollars The Continuum of Care (CoC) Program (HOME) is similar to CDBG, AV in any taxing district. Program is designed to promote except that the funds are for the communitywide commitment to sole use of providing affordable This tax may not be imposed until the goal of ending homelessness. housing for low- and very low- the legislative authority: The program provides funding income individuals. Funding is for efforts by nonprofit service allocated to states or participating 1. Declares the existence of an providers, states, and local jurisdictions. Funds can be used emergency with respect to the governments to quickly rehouse for building, buying, and/or availability of housing that is homeless individuals and rehabilitating affordable housing affordable to very low-income families while minimizing the for rent or homeownership or households; and trauma and dislocation caused to providing direct rental assistance to 2. Adopts an affordable housing homeless individuals, families, and low-income people. The program finance plan in conformity with communities by homelessness. The is flexible and allows states and state and federal laws regarding program promotes access to and local governments to use these affordable housing. effective utilization of mainstream funds for grants, direct loans, programs by homeless individuals loan guarantees or other forms of and families. And CoC optimizes credit enhancements, and rental self-sufficiency among individuals assistance or security deposits. and families experiencing homelessness.

4 Document recording fees Mental Illness & Drug Document recording fees are Dependency Tax Washington State’s largest source The Mental Illness and Drug of funding for homelessness Dependency Tax (MIDD) allows programs. Counties charge counties to impose a sales and use fees on recorded documents tax of one-tenth of one percent and are permitted to retain a to fund programs serving people portion for affordable housing with mental illness or chemical and homelessness programs. dependencies. Since 2011, any Counties generally include cities city with a population greater in committees in determining how than 30,000 has the authority to to spend the local share of the implement the MIDD tax if it has collected fees. Another portion not been passed by the county. of these funds are redirected to Programs and services that the Department of Commerce to can be funded by this revenue fund various programs, including stream include, but are not the Consolidated Homeless Grant limited to, treatment services, program. case management, and housing as a component of a coordinated chemical dependency or mental health treatment program or service.

5 Homelessness Using mitigation sites to address emergency homelessness

As many cities face increasing large FEMA-style tent shaped like Olympia’s mitigation site numbers of people experiencing an aircraft hangar with smaller The City of Olympia developed their unsheltered homelessness in their individual structures within that can own mitigation site following and communities, several have begun provide beds for 100 individuals. learning from the Tacoma model. to operate city-run ‘mitigation sites’ The city was facing upwards of 300 as a temporary response. These The site follows the low barrier to people sleeping outside every night sites are sanctioned encampments entry model (i.e. no requirement in their downtown area. Many were and can include a variety of to be sober on entry) and provides in unsanctioned encampments, temporary housing types—tents, emergency stabilization and causing public health and safety unheated small wooden structures, triage through access to services concerns. The city declared a public or some sites provide a very large such as a tent site, food, showers, health emergency in July 2018, temporary shelter with individual bathroom facilities, and laundry. which provided several elements units underneath. The sites share a Other services offered include of flexibility, including exemption variety of common features, though social services, physical and mental from state environmental review. their approaches differ across health care, legal services, and jurisdictions. transportation. The Tacoma model The city developed a downtown includes on-site staffing provided mitigation site on a city-owned Tacoma’s stability site by Catholic Community Charities. parking lot that includes 115 In 2017 the City of Tacoma declared spots for individual tents, potable a state of emergency around One lesson that the city learned water, and portable toilets. The homelessness and developed a is that it proved difficult to move Union Gospel Mission provides plan to address it. One component people from the stability sites into oversight under contract. The city of that plan was the creation of temporary housing, because of a reports a $50-$70,000 startup cost a stability site, which provided lack of available housing supply and and $200,000 annual operating shelter and services to individuals service needs of the population. costs. The mitigation site has a who were chronically homeless The program had a budget of $2.3 code of conduct that includes or experiencing behavioral health million in 2019, which includes requirements, such as no drug issues. The physical structure is a funds for other shelter operators in dealing. the city.

6 Tips to consider in a local mitigation plan

1. Clearly define success to avoid unrealistic expectations, consider measurements beyond just people served and moved from shelter. 2. Be clear about what these camps are, and what they aren’t. In most cases they are an emergency response to homelessness and safety issues at unauthorized encampments, not a solution to homelessness. 3. Work with community groups and other service providers to maximize access to services. Walla Walla’s sleeping The city originally placed the 4. Evaluate and consider center Sleeping Center on city public ramifications of different works property, but the Center During the winter of 2016, Walla potential staffing models at has now moved to an industrial Walla experienced challenges when mitigation sites. These can area. Operating the Center costs tents collapsed under the heavy significantly affect program costs. $150,000 annually and is managed snow in unauthorized homeless by a community group, the Walla camps around the city, which Walla Alliance for the Homeless, posed a significant safety risk for which provides sanitation and the occupants. In response, the city security services, and helps created a plan to help residents residents find permanent housing. experiencing homelessness find safer emergency shelter. They partnered with Community Resources Supported Shelters, a nonprofit www.cityoftacoma.org based in Eugene, Oregon to www.olympiawa.gov build 31 insulated, weatherproof, www.wwallianceforthehomeless.com lockable shelters called “Conestoga huts.”

7 Homelessness Emergency rental assistance programs: A strategy for preventing homelessness

Emergency rental assistance Rental assistance funds are used Seattle has provided funding for its prevents homelessness by helping for immediate help with current or Homelessness Prevention Program residents avoid eviction. In addition late rent, utility arrears, and legal or with money raised through a to providing funds to address interpretation fees needed to stop Housing Levy authorized by RCW their immediate housing crisis, an eviction action. Funds may also 84.52.105 and passed by the voters such programs also provide other be used for credit and background in 2009. Under the new Affordable support services to promote long checks needed to secure alternate Housing Sales Tax Credit provided term stability. stable housing, as well as security by HB 1406 in 2019, counties and utility deposits and moving under 400,000 in population and Typically, these programs provide costs. cities under 100,000 in population short-term (one to three months) are able to use the tax funds to or medium-term (up to six months) In addition to receiving financial provide rental assistance to tenants rental assistance for households assistance, program participants who are at or below 60% of the with incomes up to 50% of Area may receive or be required to median income of the jurisdiction. Median Income (AMI), that are at participate in services such as To participate in this tax credit, imminent risk of homelessness or landlord negotiations, job search jurisdictions will need to pass a have recently become homeless. assistance, money management resolution by January 31, 2020 and coaching, and help with goal legislation by July 27, 2020. Individuals and families fall into setting. housing crises and seek assistance for many reasons. Some of the most common are job loss, an unforeseen reduction in work hours, a medical emergency or disabling condition, limited income coupled with a rent increase, or the cessation of refugee resettlement assistance.

8 Homelessness Long-term “master leasing” helps provide homeless housing

Established in 1998, San Francisco’s San Francisco’s successful program The benefits of master leasing Master Leasing Program acquires signs long-term leases with include the ability to bring units sites, mainly single occupancy owners to provide permanent online rapidly, and the reliance hotels, under long-term leases with supportive housing for homeless on private capital for upfront building owners to provide housing adults. Its program is a Housing renovation costs. In addition, the for people who are homeless. First model; that is, it provides renovated buildings, combined The building owner retains housing immediately to homeless with on-site services, stabilize responsibility only for large capital people regardless of their mental properties that have often been improvements after the lease is health or substance abuse status. problematic for the surrounding signed. The sites are managed This approach is based on the neighborhood. by nonprofit organizations that idea that in order for people to provide property management and achieve stability and recovery, San Francisco funds this program supportive services on site. Building they must first have a safe, stable through its general fund and owners often renovate residential home and access to the mental Human Services Care Fund and and common areas prior to lease health, addiction treatment, and the program is managed by the signing. other services they need. Most Department of Homelessness and agree that it is very difficult to Supportive Housing. As of April While many nonprofits have address a mental health or chemical 2019, the department planned to adopted similar master leasing dependency issue while sleeping have 300 new units available in the programs, only a few cities on the street. (See also The Housing next six months. throughout the country have. First model on pg. 12)

9 Homelessness Homelessness & the limits of enforcement

Historically, enforcing sit-lie and Eighth Amendment, if a homeless consequences of being panhandling ordinances has been person has no other option than to human…’” considered a viable tool to address live and sleep outside: homelessness in public spaces. The City of Boise petitioned the However, recent court decisions United States Supreme Court for have changed the legal landscape “As long as there is no review of the Ninth Circuit decision. on enforcement, with appeals still option of sleeping indoors, At time of press, the court had not pending. In all cases, cities should the government cannot granted or denied review. evaluate their ordinances and criminalize indigent, enforcement practices to determine homeless people for The Martin case is viewed as part of whether—and what type of— sleeping outdoors, on a trend where courts conduct close regulation is necessary. public property, on the scrutiny of enforcement practices false premise they had a that impact the homeless. What choice in the matter.” follows are a few examples of that Martin v. City of Boise— trend. impact on camping, Unauthorized sleeping, or lying in In other words, camping ordinances are not inherently unconstitutional, encampments—seizures public The Martin case involves issuance In September 2018, the Ninth but a municipality can be in of criminal citations to homeless Circuit Federal Court of Appeals violation of the Eighth Amendment individuals. A different Ninth case ruled in Martin v. City of if the person cited had no Circuit case, Lavan v. City of Los Boise that it is unconstitutional meaningful alternative to sleeping Angeles, addresses a related for the City of Boise to enforce outside. issue—due process requirements ordinances prohibiting camping for the removal of unauthorized in public places against homeless However, in footnote 8, the court encampments on public property. individuals at times when no shelter set forth some limits on the scope space is available. Washington is of its decision: Prior to clearing encampments, part of the Ninth Circuit, so this local governments must provide decision applies to Washington 1. It does not cover individuals notice to camp residents (72-hour municipalities. who do have access to adequate temporary shelter but choose not minimum notice is common). It is also important to have outreach The court found that the City of to use it. personnel present during Boise’s enforcement of ordinances 2. Even when shelter is unavailable, encampment removal, whose prohibiting camping, sleeping, or an ordinance may prohibit job it is to help individuals in an lying in public violated the U.S. sitting, lying, or sleeping outside encampment identify shelter Constitution Eighth Amendment at certain times or in certain options or alternative locations ban on cruel and unusual locations. to go to. Personal property found punishment if an individual does 3. An ordinance may prohibit during the encampment removal not have a meaningful alternative obstruction of rights-of-way or must be held for a certain amount (such as space in a shelter or a the erection of certain types of of time so that it can be claimed legal place to camp). From the structures. by the owner. Storage of 60 days is court’s standpoint, it is not a common – the City of Seattle allows simple question of whether an 4. Whether such ordinances are for at least 70 days. ordinance prohibiting camping on consistent with the Eighth public property is constitutional. Amendment will depend on Rather, the enforcement of such “whether it punishes a person an ordinance is considered cruel for lacking the means to live out and unusual punishment under the the ‘universal and unavoidable

10 Unauthorized Although cars and trucks are ordinance prohibited begging encampments—searches not traditionally thought of at highway on/off ramps and at as residences with respect the major intersections, and several In 2017, the Washington Court Homestead Act, the court noted other locations. Because freedom of Appeals ruled that tents and that under RCW 6.13.010, “the of speech is protected in public shelters set up on public property homestead consists of real or forums, and sidewalks are a and used for habitation are personal property that the owner traditional public forum, the court protected from unreasonable uses as a residence.” The court ruled that Lakewood’s ordinance searches under the Washington ruled that the impound itself was overreached in the number of State Constitution. In State v. Pippin, legal, but that the impound fee public forums that were restricted. Mr. Pippin was arrested when the constituted a lien on the vehicle, Even though courts agree that police found drugs in his tent. The which should have been exempt panhandling is speech, it can court ruled that law enforcement under the Homestead Act. be restricted by time, place, and officers needed to obtain a manner restrictions as long as search warrant before searching It is important to note that as a enough alternative avenues of Mr. Pippin’s tent. The court superior court case this decision is communication remain available. acknowledged the pervasiveness of not precedent for Washington local homelessness and the need for the governments. However, at time In light of Willis, cities should review law to be flexible in responding to of printing, the case was pending their regulations and enforcement it, stating: before the Washington Court of practices. Asking for help or aid is Appeals. protected speech and courts will closely scrutinize regulations that “The law is meant to apply Panhandling regulations focus on certain types of speech to the real world, and the The Washington Supreme Court (such as soliciting aid). Public realities of homelessness struck down an ordinance safety laws (such as obstructing dictate that dwelling places prohibiting begging or traffic) may present appropriate are often transient and panhandling on First Amendment enforcement alternatives when precarious. The temporary grounds in the 2016 case of City fairly applied, since these laws do nature of Pippin’s tent does of Lakewood v. Willis. In Willis, the not undermine any privacy not regulate protected speech. interest.”

Use of vehicles for habitation A King County Superior Court judge ruled in 2018 that an individual residing in a vehicle may have homestead rights in the vehicle. The Homestead Act protects a person’s residence and essential possessions from judgments and liens. Steven Long, a homeless individual who resided in his vehicle, challenged the City of Seattle’s impoundment of his vehicle and the $500 impound fee charged by the towing company.

11 Homelessness The Housing First model

The central goal of the Housing • Services are tailored to each The Housing First model has First approach is to provide individual’s or family’s needs; and been shown to reduce public permanent, affordable housing. • Housing is not contingent on costs of homelessness such as By providing housing assistance, participation in services or use of emergency rooms, police case management, and supportive treatment; the only requirement services, courts and jails, and services after an individual or is that participants comply with public sanitation. The federal family is housed, communities a standard lease agreement, and Department of Housing and Urban can significantly reduce the time services are intended to help Development estimates that each people experience homelessness homeless person costs between them do so successfully. and prevent further episodes of $30,000 and $50,000 per year in homelessness. such costs. A central tenet of the Housing First Housing First is an approach used approach is that social services The cost to provide permanent for both first-time homeless families that enhance individual and family housing and support services and individuals, and for people well-being are more effective when to help people stay housed is who are chronically homeless. people are in their own home approximately $20,000 per year. For the chronically homeless, this than when they are living with the is also referred to as “low barrier” extreme stress of homelessness. The stable living environment housing because typically there facilitates effective, and/or are no preconditions that the While there are a wide variety of more cost-effective treatment participant be clean and sober to program models, all Housing First than emergency rooms and obtain housing. Participants are programs typically include: incarceration. housed with access to services such as mental health and addiction • Assessment-based targeting of Program models vary depending treatment on-site or nearby, but are Housing First services; on the client population, the not required to use the services. • Assistance locating rental availability of affordable rental housing, relationship housing, and/or housing The Housing First approach development with private market subsidies and services. Housing provides homeless people landlords, and lease negotiation; First programs often reflect the with housing quickly, without needs and preferences of each preconditions such as requiring that • Housing assistance ranging from community, further contributing to they become clean and sober first. security deposit and one month’s the diversity of models. rent to provision of a long-term Generally, Housing First programs housing subsidy; share these elements: • A housing placement that is not time-limited; and • A focus on helping individuals • Case management to coordinate and families access and sustain the services that follow a housing permanent rental housing as placement. quickly as possible; • A commitment to permanent rather than temporary or transitional housing; • Provision of social and health services following a housing placement;

12 Homelessness Tiny house villages: Quixote Village & Emerald Village

Tiny house villages offer a lower- Financing for the program’s a program manager, and a case cost way to provide safe housing, development was provided by: manager/resident advocate. Mental and the benefits of community health services are also offered living and peer support for people • $1.5 million in the state capital on-site. There is also a Resident recovering from homelessness. budget, which came through the Council, which helps govern the state Department of Commerce’s village and coordinates community The term “tiny house” covers a wide Housing Trust Fund; holiday parties, barbecues and range of structures and program • $699,000 from federal other events. models. Some are permanent Community Development Block structures with heat, plumbing, Grant funding that came through Emerald Village and other amenities that will last Thurston County and the City of Emerald Village Eugene is an for many decades; others are less Olympia; affordable tiny home community expensive, impermanent, and developed by SquareOne Villages. • $170,000 in Thurston County unheated and unplumbed. Village It builds upon the success of funding from document recording program models also vary. Opportunity Village Eugene, which fees; and is a transitional micro-housing Quixote Village • $215,000 in community community for otherwise homeless Located on a two-acre site in donations, including the Nisqually individuals and couples. This next Olympia, Washington, Quixote Tribe, the Chehalis Tribe, the iteration of the village model Village consists of 30 cottages Boeing Employees’ Fund, and provides a permanent, accessible, wrapped around a central open individual donors. and sustainable place to transition to. space, and a 2,640 square foot community building that includes The total cost of the village was just Various teams of local architects a communal kitchen, dining and over $3 million or about $100,000 and builders provided in-kind living room, showers, laundry per unit. The village meets the services to lead the design and facilities, and staff offices. The state’s green building code and all construction of 14 of the 22 tiny village provides permanent local building codes. homes at Emerald Village— supportive housing for homeless allowing for the demonstration of adults, including people suffering The Village has three on-site, full- a variety of compact design and from mental illness, people with time staff: an executive director, construction methods. SquareOne physical disabilities, and people recovering from addiction.

Rendering of Emerald Village

13 cooperative to cover utilities, maintenance, long-term reserves, and all other operating costs. Each member also pays a membership fee of $50 per month—enabling them to create a modest asset that can be cashed out if, and when, they choose to leave. SquareOne retains ownership of property in trust to assure continued affordability to future members of the cooperative.

By combining the benefits of cooperative housing with safe, decent, and cost-effective tiny houses, Emerald Village offers an accessible and sustainable housing model that can be implemented in led the design and construction As a new and innovative approach other communities. of the other eight homes using to affordable housing, the capital structural insulated panels (SIPs). costs have been funded by small grants, private donations, and lots Resources Each of the homes at Emerald of in-kind gifts from individuals, www.quixotecommunities.org Village are designed as permanent businesses, and institutions in the www.squareonevillages.org dwellings on a slab foundation— surrounding community. In fact, complete with sleeping and over 200 local business contributed living areas, a kitchenette, and a to the project in some way. As a bathroom—all in 160-288 square result of this outpouring of support, feet. The individual dwellings it cost around $55,000 per unit to are supported by a Community build Emerald Village, including the Clubhouse that includes a flexible- cost of land. use gathering area, community kitchen, laundry, restroom, and Unlike most affordable housing storage of common resources like projects, residents of Emerald tools and other appliances. Village are not simply renters, they are members of a housing Construction of Emerald cooperative. They realize Village began in May 2017 affordability through shared as a collaboration between resources, self-management, and local contractors, community operating at-cost. A community volunteers, and future residents agreement outlines a basic code (each resident put in at least 50 of conduct that all residents must hours of sweat equity during agree to abide by, and each resident development stages). is an active participant in helping to operate and maintain the village. Members make monthly payments of between $200-$300 to the

14 Homelessness Local governments’ winter shelter programs

While local governments in more consecutive hours and/ or Multi-jurisdiction model Washington work to develop long- snow accumulation exceeding or serves King County’s term solutions to homelessness, expected to exceed three inches they must also respond to in depth and/or other conditions Eastside immediate threats to life and safety deemed severe enough to present a The cities of Bellevue, Redmond, that arise when temperatures substantial threat to life or health of Kirkland, Issaquah, and Sammamish fall to freezing or below. Some homeless persons” occur. collaborate to provide east King communities have developed County with three “low barrier” winter weather shelter programs to The city announces shelter (shelters with limited entry address this need. activation by emailing community requirements are called “low- organizations, including the police, barrier”) shelters: Winter weather shelter programs fire, and parks departments, can take many forms, but they local schools, and others, and • Catholic Community Services (for often involve a partnership with a by posting signs and posters at families); local faith-based or other nonprofit various community locations. A • Sophia Way (for single women); organizations for the use of private YouTube video, produced by the and facilities. While it is possible for Kent Housing and Human Services • Congregations for the Homeless a city or county to use its own Department, describes how the facilities for this purpose, the shelter program works. (for single men). logistical challenges of overnight staffing, meal preparation, The program gives priority to The City of Bellevue takes the lead scheduling of multipurpose homeless families with children in contracting with the shelter facilities, insurance, and other (living on the street or in vehicles) organizations and each of the similar issues – can make this but also provides space for single participating cities pays a share option complicated to implement. women and men. The shelter is of the cost. Under the terms of open daily from 9 pm to 7 am while the contract, shelter services are Kent partners with local severe weather conditions exist. provided during a fixed period (November–April) as opposed to church Shelter staffing is provided by being triggered by a particular, The City of Kent partners with church volunteers and Catholic cold-weather event. In August a local church to operate a cold Community Services. The 2019, the city announced its plan to weather shelter during specific, volunteers prepare the facility, greet operate the Congregations for the cold-weather events. guests, conduct safety screenings, Homeless men’s shelter full-time. prepare meals, do laundry, and This new service is set to start in Following a particularly cold winter provide overnight supervision. To September 2019 and operate until in 2008-09, Kent community leaders address security issues, the police 2022 when a new full-time shelter and members of a local, faith-based department is notified when will be constructed. organization developed a winter the shelter is activated and staff weather shelter program to provide are instructed to call 911 if an temporary housing at a local emergency situation occurs. The church during severe, cold-weather church group also provides some events. Under the terms of the staff trained to assist people in service agreement, the shelter can crisis. The church carries insurance be activated by the city’s Housing coverage based on the terms of the and Human Services Manager service contract with the city. between the months of November and March when “temperatures fall below 32 degrees for 24 or

15 Affordable housing How cities can make use of up to 20 years of affordable housing shared revenue

In the 2019 legislative session, There are tight timelines that must The role of qualifying the state approved a local be met to access this funding local taxes revenue sharing program for source – the first is January 31, The following are considered local governments that provides 2020 to pass a resolution of intent. “qualifying local taxes” and, if levied, up to 0.0146% of local sales and The tax ordinance must then be give the city access to both the city use tax credited against the state adopted by July 27, 2020 to qualify and county shares of the tax credit sales tax for housing investments, for a credit. (i.e. 0.0146% rate instead of the available in increments of 0.0073%, single share rate of 0.0073%): depending on the imposition of The following information is other local taxes and whether a intended to help a city evaluate • Affordable housing levy (property city’s county also takes advantage. its options and timelines. It is not tax) under RCW 84.52.105. intended as legal advice. Check If the city decides to access it, the with your city’s legal counsel and/or • Sales and use tax for housing tax credit is in place for up to 20 bond counsel for specific questions and related services under RCW years and can be used for: on project uses and deadlines for 82.14.530. The city must have implementation. adopted at least half of the • Acquiring, rehabilitating, or authorized maximum rate of constructing affordable housing; Eligibility to receive 0.001%. • Operations and maintenance shared revenues • Sales tax for chemical of new affordable or supportive dependency and mental health housing facilities; and (optional .1 MIDD) under RCW • The state is splitting the shared 82.14.460. • Rental assistance (an eligible use revenues between cities and only in smaller cities). counties. However, cities can • Levy (property tax) authorized receive both shares if they have under RCW 84.55.050, if used solely for affordable housing. The funding must be spent on adopted a “qualifying local tax” by projects that serve persons whose July 31, 2020. Qualifying taxes are income is at or below 60% of the detailed below. Cities that levied a “qualifying local tax” by July 28, area median income (AMI). The Think of the “qualifying United States Department of 2019 (the effective date of the new law) will receive both shares local tax” as a multiplier or Housing and Urban Development “doubler.” It gives the city calculates the median income for immediately once they impose the new sales tax credit. access to double the tax various regions across the state. credit even when the county Cities can also issue bonds to • If a city does not implement chooses to participate in the finance the authorized projects (see a qualifying local tax by the program. related article on pg. 23). deadline, they can still participate in the program if they meet This local sales tax authority is a the other deadlines, but will be credit against the state sales tax, eligible for a lower credit rate. so it does not increase the sales • A city can adopt the sales tax tax for the consumer. When a local credit before designating how government decides to levy this the funds will be used once new sales tax, the state reduces collected. their tax rate by the same amount. This leaves the consumer paying the same total tax as before.

16 Eligible uses of the funds 3. Funding the operations and maintenance costs of new units Resources of affordable or supportive AWC HB 1406 implementation 1. Projects must serve people at or housing. guide, including a how-to flow below 60% AMI. 4. For cities with a population under chart Department of Revenue 2. Acquiring, rehabilitating, or 100,000, the funds can also be implementation guidance constructing affordable housing, used for rental assistance to which may include new units tenants. of affordable housing within an existing structure or facilities 5. The legislation provides authority providing supportive housing and encouragement to partner services. In addition to investing and work regionally including in traditional subsidized housing through interlocal agreements. projects, this authority could potentially be used to provide for land acquisition, down payment assistance, and home repair so long as recipients meet the income guidelines.

17 Affordable housing Finding missing middle housing

Housing affordability is one of the accommodating future population The workgroup held eight monthly greatest challenges facing many increases, increasing walkability, meetings, all of which were open communities in the western U.S. and supporting neighborhood to the public. They identified and Rising demand outpaces the supply businesses. discussed dozens of issues, focusing of additional housing units, driving especially on 14 major issues for prices steeply upward. Some Washington cities have been which they directed city staff to examining zoning changes to prepare more detailed issue papers. Yet many cities and towns restrict permit missing middle housing in These included requirements significant portions of their more neighborhoods. For example, for off-street parking, limits on community to the most expensive the City of Olympia recently height and setbacks, water and type of housing—single-family adopted an ordinance to allow sewer hookup costs, impact fees, homes—while limiting other many types of missing middle and maximum housing density. housing choices to multi-story housing in most residential zoning They also received input through apartment buildings in or near busy districts. Other cities have better an open comment portal on the commercial districts. Traditionally, enabled individual types of missing city’s website and at several public this type of land use planning has middle housing, such as ADUs. open houses. At its final meeting, been strongly supported by a city’s In some cases, these proposed the workgroup reviewed specific homeowners, believing it maintains changes have generated significant recommendations from city staff neighborhood character and public debate, particularly over based on the group’s discussions. property values. possible changes to existing The recommendations were to neighborhoods. permit a greater variety of housing While single-family homes and types in Olympia’s low-density multi-story apartments remain Olympia’s experience residential zoning districts and to popular types of housing, there is Olympia’s process began in late reduce development regulations a noticeable housing type missing 2016 when the Olympia City and fees to more easily allow in these communities. Many cities Council established a 16-member smaller housing units to be and towns prevent (or strongly citizen workgroup to review its constructed. discourage) the types of housing zoning code and development that are “in the middle,” housing fees to identify ways to better Although it had strong policy that, in size and character, is enable missing middle housing support in the Olympia somewhere between single-family throughout the city. The workgroup Comprehensive Plan, the idea of homes and multi-story apartments. included a broad range of interests allowing multi-unit residential These include small-scale, multi- and expertise, and group members buildings in neighborhoods unit housing such as duplexes, brought a thorough knowledge of historically dominated by triplexes, townhouses, backyard the local housing market and the single-family homes ultimately cottages (aka, accessory dwelling community’s neighborhoods. caused heated public debate. units or ADUs), and courtyard- Organized citizen groups formed style apartments. Allowing and on opposite sides of the debate, encouraging these ‘missing each conducting intensive public middle’ housing types can provide outreach campaigns. more affordable living options, particularly for the growing number of one- and two-person households in our communities—and provide it in a way that is compatible with existing neighborhoods. This approach can also contribute to other community goals, such as

18 Following nine months of public The council felt Olympia’s The new plan recognized the debate and lengthy discussion by existing development standards need to accommodate 20,000 the Olympia Planning Commission, adequately addressed several new residents by 2035. To do so, the Olympia City Council issues with no changes. These it designated three high-density unanimously adopted the following included design review standards neighborhoods near its commercial changes to the city’s low-density for infill development, low impact centers to accommodate zoning districts: development stormwater measures, approximately 75% of that • ADU requirements were regulations of environmentally growth. But the plan also called for relaxed (height, parking, size, sensitive areas, and open space and increasing housing opportunities requirement for owner to live tree protection standards. within low-density neighborhoods, areas that make up over 70% of the on-site, and prohibition of Lessons learned on best manufactured homes). city’s territory. Plan policies called practices for: • A greater variety of housing types Olympia’s two-year experience (duplexes, triplexes, fourplexes, • A variety of compatible housing provides several lessons that types; cottages, and small courtyard may be helpful to other cities apartment buildings) were considering changes to increase • Removing unnecessary allowed, especially near major missing middle housing. regulatory barriers to housing; transit routes and commercial • Addressing neighborhood districts. Lesson #1: Ensure supportive character; policies in the comprehensive • Added requirements for multi- • Blending multifamily housing plan unit housing (wider lot widths, into neighborhoods; and wider setbacks, and higher Olympia completed a major rewrite off-street parking requirements) of its comprehensive plan in late • Providing housing variety for all were removed. 2014, a process that included income levels. substantial public outreach and • Utility and impact fee involved thousands of individuals. This policy framework provided requirements for smaller housing the impetus for a public process to types (allow for shared utility flesh out the details for carrying out connections, scale impact fees, these policies. and utility hookup charges for smaller units) were reduced.

While a greater variety of permitted housing types was proposed, the allowed density of the zoning districts was not increased. Also, minimum lot size now increases with the number of units proposed.

19 Lesson #2: Get expert analysis Lesson #3: Revisions to zoning • Older neighborhoods may and opinions to identify an provisions should vary according already be experiencing appropriate approach for your to location and existing internal conversions of houses community development into multiple units. Adopting The Olympia City Council chartered Missing middle housing provides appropriate design standards a citizen’s workgroup to identify varying housing types, offers may encourage this to barriers in city fees and codes affordability options, and continue in a way that remains impacting the construction of helps accommodate predicted compatible with the established multi-unit housing in its residential population growth. However, neighborhood aesthetics. zones, as well as potential solutions. determining which zoning • Recently developed subdivisions The workgroup consisted of provisions to revise should vary that have smaller lots may make 16 community members with according to location and historic it more difficult to locate three or expertise in a broad range of fields type of development. more additional units on them. including construction, real estate, The workgroup’s analysis was very In these neighborhoods, it may finance, property management, clear—future population growth be more appropriate to limit and neighborhood organizing, as in Olympia would continue and missing middle housing to ADUs, well as city-based renters. Overall, increasingly consist of smaller duplexes, or 2-unit townhouses. the members brought a thorough households that are more knowledge of the local housing constrained in their ability to afford Lesson #4: Sharing public policy market and the community’s and purchase single-family houses. issues in bite-sized pieces may neighborhoods. Providing for this future population help improve public discussion Through discussions and research, requires significantly greater variety In Olympia’s process, the as well as public input from two in housing types and levels of recommendations reviewed by community open houses, the affordability than currently exists. the workgroup were unveiled to workgroup identified 14 major Understanding the existing visual Olympia citizens all at once in a issues needing deeper analysis. The and social context is critical to draft summary document. To try to city also contracted with Thurston determining what additional types help people understand design and Regional Planning Council to of housing could be developed development standards currently analyze the proposal’s potential over time that are compatible with in place versus the new proposed effects on future housing capacity. existing development. Take note of standards, staff developed a simple the following considerations: At its final meeting, the workgroup comparison chart. Graphics and reviewed specific recommendations • Allowing a greater variety illustrations explained how the made by city staff in response to of missing middle housing proposed changes would apply the 14 challenging issues the group types near transit may allow to duplexes, triplexes, fourplexes, had identified. This process ensured opportunities to decrease off- courtyard apartments, cottage that the recommendations were street parking requirements, thus developments, and other housing based on detailed discussion and lowering the cost of construction. types on lots of various sizes. analysis that reflected a broad set of perspectives and voices.

20 However, citizens not familiar In hindsight, the broader with zoning regulations found the public understanding of the Resources complex set of recommendations recommendations might have www.olympiawa.gov/ difficult to comprehend. As a result, been improved if individual issues missingmiddle the proposal was quickly sloganized had been introduced separately by opposing citizen groups, both rather than all at once. Olympia’s for and against the overall idea of workgroup laid the foundation adding housing units in existing by identifying these major issues neighborhoods. Once public and then discussing each one discussion was effectively reduced during its research efforts, often to an “all or nothing” debate, it finding several potential alternative became nearly impossible to regain solutions to the challenges. Had focus on key public policy details. this information been provided Detailed points of discussion by the to the public on an issue-by-issue knowledgeable workgroup early in basis, this could have been helpful the process never really entered the for the broader public discussion larger public discussion once social and would have provided greater media campaigns began to take context to each issue. hold. Special thanks to Leonard Bauer, City of Olympia, for contributing the content for this article!

21 Affordable housing New resources available for Housing Action Plans

Passed by the 2019 Legislature, HB A city’s plan must review the 1923 was a wide-ranging proposal performance of the most recent Resources that was passed into law that GMA housing element. The plan Text of HB 1923 to review provides funding for cities planning must also analyze population specific requirements in under the Growth Management and employment trends and Section 1(2) Act (GMA) to adopt a local Housing consider strategies to minimize Department of Commerce HB Action Plan. Interested cities displacement of low-income 1923 grant application with populations above 20,000 residents during redevelopment. may submit applications to the Finally, the plan must develop Our Valley Our Future plan Department of Commerce for a strategies to increase the supply City of Tacoma Affordable grant up to $100,000 to support and variety of housing based on Housing Action Strategy their work. Depending on fund the data gathered; critically, it must City of Ellensburg Housing availability, smaller cities may also include a schedule of programs and Action Plan have access to grants.1 actions to implement the plan. City of Port Angeles Housing The law’s broader goal is to In developing the plan, HB 1923 Action Plan encourage cities to take action requires that a city include a broad City of Tumwater Housing to increase housing supply. group of specified stakeholders, Action Plan Recognizing that not all of the such as community members, local actions listed in the bill would builders and realtors, religious City of Sequim Housing Action be relevant to every city, the groups, and nonprofit housing Plan Legislature created an alternative advocates. means to support a tailored approach—developing a Housing 1As of printing, AWC is in conversation with the Department of Commerce on their interpretation Action Plan. of the language in HB 1923. Commerce is interpreting the language to limit grants to housing action plans to cities with a population above 20,000. AWC does not believe this was the Legislature’s intent nor do we read the express language of the law to direct Commerce to limit A Housing Action Plan is a locally eligibility for Housing Action Plan grants to the size of a city’s population. developed plan to encourage additional housing construction— both affordable and market rate— to create greater variety of housing types at prices that are accessible to a wider range of incomes.

As required in HB 1923, a Housing Action Plan must quantify existing and projected housing needs across all income levels, consider household characteristics, and assess the number of cost- burdened households. The state is funding the Center for Real Estate Research at the University of Washington to compile these and other data points for cities to use in their plans.

22 Affordable housing Multifamily housing bonds

As cities and counties grapple with The role of partnerships Both local housing authorities and mounting housing insecurity, they Although cities and counties the Washington State Housing are increasingly considering issuing are permitted to issue bonds for Finance Commission (HFC) are bonds to support the production housing, most have delegated frequent issuers of private activity of rental housing that is affordable this responsibility to local housing bonds for housing. HFC is the to working families. Housing is authorities. The 37 city and county designated statewide issuer of infrastructure and can be an eligible housing authorities in the state “conduit” private activity bonds purpose for public borrowing, can issue both governmental and for housing, both volume cap using both tax-exempt and taxable private activity bonds (as defined and qualified 501(c)(3) bonds. bonds. below). Many are frequent issuers HFC issues bonds, then loans the of housing bonds, and own and proceeds to private developers Types of bonds operate affordable rental housing (both for-profit and nonprofit) to Raising funds through borrowing for their establishing jurisdictions. buy or build housing throughout at tax-exempt interest rates is a This partnership between local the state. long-standing practice utilized by housing authorities and their state and local governments for establishing city or county can Project requirements all types of infrastructure projects. free local governments from the When issuing governmental Governmental entities can issue business of running housing bonds for housing, local housing three types of tax-exempt bonds to projects, which requires special authorities are required by state finance affordable housing: expertise and attention. statutes to set aside at least half of the project (by units or square • Governmental bonds Alternatively, a government can footage, whichever is larger) for issue bonds and loan the proceeds • “Volume cap bonds”1 low-income residents. “Low-income to another entity that is responsible residents” has historically been • Qualified 501(c)(3) bonds for developing the housing. In such interpreted to mean residents cases, the type of bond issued will with incomes at or below 80% of depend on who owns and operates Local governments regularly issue area median income. The other the housing. If a 501(c)(3) nonprofit governmental bonds for core half of the project may be rented entity is the owner and operator, governmental purposes, such as to tenants paying market rents. the bonds could be qualified schools, libraries, roads, fire trucks, When either housing authorities or 501(c)(3) bonds. If the owner and and administrative buildings. the HFC issues volume cap bonds, operator is a for-profit entity—or As housing pressures mount, federal tax law requires that the if it is a nonprofit entity or housing governments are increasingly projects reserve 20% of the units authority that has partnered with treating housing as a core for residents earning no more than a for-profit entity—the bonds governmental function. Projects 50% of area median income or 40% issued would be volume cap bonds. that qualify for governmental of the units for residents earning The latter category of bonds, bonds generally must be owned no more than 60% of area median and indeed 501(c)(3) bonds, are and operated by a governmental income. In most cases, because considered “private activity bonds” entity (such as the county, city, volume cap bonds trigger the because the owner and operator is or housing authority) and have project’s eligibility for federal low- not a governmental entity. 2 traditionally served residents at or income housing tax credits (LIHTC) , below 80% of area median income.

1Also referred to as “qualified residential rental bonds” or “142(d) bonds” because of the governing section of the Internal Revenue Code for this type of bond. The federal government imposes a per capita limit (currently $105 per person) on the amount of certain types of private activity bonds that can be issued within each state each year. In 2019, Washington State’s total private activity bond volume cap allocation was $791,237,055. The state, through the Department of Commerce, further allocates the private activity bond volume cap among exempt facilities, housing, small issue, and student loan categories—with housing traditionally receiving the largest share of the annual allocation. Ch. 39.86 RCW, WAC 365-135.

23 in order to maximize the LIHTC source of funding to a project, pay debt service on the bonds. investment most of these housing local governments can help “plug Jurisdictions could establish either projects will be 100% low income, the gap” to ensure the affordable a single jurisdiction trust fund or a at 60% of area median income. housing development can be built. pooled trust fund to which other jurisdictions could contribute Paying back the bonds A new tool for debt either bond proceeds or sales tax The debt service on private service revenues to pay debt service on a activity bonds issued by housing pooled bond issue. In addition to The new sales tax credit provided the state Housing Trust Fund, which authorities and the HFC is usually 3 by HB 1406 in 2019 has sparked is funded with state-issued bonds paid from rents generated at the interest among local governments projects. From time to time, local and managed by the Department of in issuing bonds backed by the Commerce, trust fund models exist housing authorities will pledge sales tax revenues. Building other unrestricted funds to pay in many jurisdictions. For instance, upon existing partnerships, the cities of Seattle, Vancouver, and debt service. Because the cost cities and counties can assist of developing housing is high, Bellingham housing trust funds their local housing authorities, are funded from housing levies; the project rents are usually private developers, and nonprofit insufficient to repay traditional Spokane’s trust fund is funded from organizations with plugging the document recording fees. forms of debt needed to make a gap when they buy and build housing project affordable to lower affordable housing by issuing The state and local trust funds income residents. Many affordable governmental bonds. The bonds projects have multiple funding play an important role in ensuring issued would likely be taxable to the success of affordable housing sources—including bonds, LIHTC 4 provide for maximum flexibility. projects. investment, and state Housing Trust The bond proceeds can be used to Fund loans—which reduce the establish a local “trust fund” which Special thanks to Faith Li Pettis at cost of borrowing. However, even could lend money to affordable Pacifica Law Group for submitting with these multiple sources, a gap housing developers to build or this article. between the funding available and operate select projects. The new the costs of development often revenues provided by the tax credit remains. By providing an additional could then be used annually to

2 The federal LIHTC program is an incentive program, as opposed to a subsidy program, that provides a dollar for dollar tax credit to investors in affordable housing projects. It’s one of the most successful affordable housing production programs in U.S. history, having created about 2,000,000 units of housing since inception. The equity provided to a project from tax credit investors is a significant source of funding for many affordable housing developments and is triggered by the issuance of volume cap bonds. Because of the importance of the LIHTC as a capital source for financing housing, qualified 501(c)(3) bonds for housing are infrequently issued – they do not bring with them the LIHTC.

3 SHB 1406, Chapter 338, Laws of 2019. Note that HB 1406 does not establish a new tax, but provides a credit against the state sales tax collected in a jurisdiction. It is not an additional tax to consumers.

4Use of tax-exempt governmental bonds may preclude LIHTC investment or private ownership and development of the project.

24 Affordable housing Land Acquisition Program

The Washington State Housing Loan details How to apply Finance Commission’s Land LAP loans carry a 1% interest rate Applications for LAP are accepted Acquisition Program (LAP) offers with a 1% loan fee and a maximum continually; projects are considered low-interest loans to help nonprofit term of eight years. Although loans based on fund availability. Strong and public organizations buy land may be outstanding for up to eight consideration will be given for the eventual development of years, it is anticipated that most to applications that propose affordable housing. In acquiring loans will be repaid within four to leveraging LAP funds with other land under LAP, cities and their six years. financing sources. housing partners can respond quickly to secure development sites Interest payments are deferred as the properties become available for the term of the loan, which is on the market, and not have to wait intended to be paid off with the until all the financing is assembled proceeds of construction financing for construction costs. in order to recycle the funds for use in future transactions. Specific Program details terms and conditions of the loans are set forth in a loan agreement • Eligible borrowers: nonprofit and deed of trust. housing assistance organizations, local housing authorities, The program has no maximum local governments, housing loan amount. However, LAP is not Resources authorities, and tribal authorities intended to cover 100% of site Washington State Housing acquisition costs. The average loan Finance Commission (WSHFC) • Secured site must be developed amount of the projects financed to www.wshfc.org within eight years of financing date is $675,000. • Housing can be either multifamily or single-family units • Housing must target populations at or below 80% of area median income • Rental housing must remain affordable for at least 30 years

Quick facts • Created by the Legislature in 2007 • 52 housing sites financed using $35 million in loans • Revolving loan fund at an interest rate of 1% • Seeded with $1 million in state funds; Commission has invested the rest from non-state funds

25 Affordable housing New state law incentivizes increased residential building capacity & density

A new law encourages all cities to Eligible activities Two methods for promoting take actions to increase residential specific types of missing middle building capacity, especially in areas Four options for allowing greater housing (non-ADU): served by existing infrastructure. density: 1. Authorize at least one duplex, Passed in the 2019 legislative 1. Increasing residential density triplex, or courtyard apartment session, HB 1923 provides in one or more areas near on all parcels in one or more temporary incentives in the form commuter or light rail stations to zoning district that permits of financial support and appeal 50 dwelling units per acre, within single family residences unless protection for jurisdictions over an area of at least 500 acres in the city documents a specific 20,000 in population that adopt size that has at least one train infrastructure or physical two or more identified policies station.* constraint that would make this to support residential building unfeasible for a specific parcel. 2. For cities greater than 40,000 capacity and density. Cities that population: authorizing twenty- 2. Authorize a duplex on every adopt two or more of the policies five dwelling units per acre corner lot within all zoning detailed next are eligible to apply to within an area of at least five districts that permit single-family the Department of Commerce for hundred acres that includes at residences. up to $100,000 grants to support least one bus stop served by bus their adoption. Additionally, the A very specific set of Accessory service at least four times per action to adopt the policies is not Dwelling Unit (ADU) policies: hour for twelve or more hours.* subject to appeal under the State Environmental Policy Act (SEPA) 3. For cities less than 40,000 • Authorize attached ADUs on all or the Growth Management Act population: authorizing twenty- parcels with single-family homes (GMA). five dwelling units per acre where the lot is at least 3,200 sq. within an area of at least two ft; and These appeal protection incentives hundred and fifty acres that • Allow attached and detached expire April 1, 2021 – the includes at least one bus stop ADUs on all parcels containing Legislature’s goal was to spur early served by bus service at least single-family homes where the action on the housing crisis. four times per hour for twelve or lot is at least 4,356 sq. ft; and more hours.* • Ordinances must not require on- Where these policies make sense, *In all three of these options, a city site parking, owner occupancy cities should take advantage of cannot require more than an average requirements, or square footage this unique opportunity. The of one on-site parking space per limitations below 1,000 sq. ft for appeal protection provides some two bedrooms in the portions of the ADU; and assurance that after your city goes multifamily zones that lie within this • Must not prohibit the separate through the normal robust public area. process and arrives at a conclusion rental or sale of ADU and primary home; and with potentially difficult votes, you 4. Authorize a minimum net density will know that your city is safe from of six dwelling units per acre in • Impact fees cannot be more than legal appeal. all residential zones (this action the projected impact of the unit. must result in an increase in Other than these factors, ADUs capacity to be eligible). may be subject to such regulations, conditions, procedures and limitations as determined by the city.

26 Six permit or development 4. Adopt increases in SEPA streamlining related actions: categorical exemptions for Resources residential or mixed-use www.commerce.wa.gov 1. Authorize cluster zoning or development using the SEPA lot size averaging in all zoning “infill” authority in RCW districts that permit single family 43.21C.229. This authority allows residences. a city to increase categorical 2. Adopt a ‘transit oriented’ subarea exemptions to a virtually plan under RCW 43.21C.420. unlimited degree where current Preexisting authority that density and intensity of use provides SEPA appeal protections is lower than called for in the to qualifying projects near transit comprehensive plan. There are stations. several requirements to use this tool, but it is very powerful. 3. Adopt a planned action in an area containing residential or 5. Adopt a form-based code or a mixed-use development that is code based on physical form within one half mile of a transit rather than separation of uses. stop or a proposed transit stop 6. Adopt the maximum authorized that will be built within five level for the division or redivision years. No environmental impact of land through the short statement is required. subdivision process. Depending on level of interest and available funds, grant support may also be provided to smaller cities. Check with the Department of Commerce.

27 Affordable housing Revising city regulations to encourage accessory dwelling units

Accessory dwelling units (ADUs) There are two types of ADUs: have been around for decades. In many parts of Washington State, 1. Attached ADU, which may be the concept is accepted and local created as either: governments have revised their a. A separate unit within an regulations to accommodate such existing home (such as in an housing. Even so, the number of attic or basement); or ADUs created in accordance with local standards has remained b. An addition to the home relatively low, due in part to (such as a separate the difficulty in meeting those apartment unit with its own regulations and the associated entrance). costs. In response, a few local 2. Detached ADU, created in a governments are relooking at their separate structure on the lot standards and discussing how to (such as a converted garage or a make them easier to meet. The new “backyard cottage”). potential easing of existing ADU In 2019, the Washington Legislature regulations, however, is causing Reasons for allowing passed a bill (HB 1923) which neighborhood homeowners to take offers $100,000 in grant funds if a notice. ADUs city commits to adopting at least State law (RCW 43.63A.215 and two actions that are intended to What is an accessory RCW 36.70A.400) requires that increase local residential capacity. certain cities and counties adopt Such adopted actions are also dwelling unit (ADU)? ordinances to encourage the exempt from GMA and SEPA An accessory dwelling unit (ADU) development of ADUs in single- appeals. One of these actions is is a small, self-contained residential family zones, by incorporating the expanding allowances for accessory unit located on the same lot as an model ordinance recommendations dwelling units (ADUs) with specific existing single-family home. prepared by the Washington code provisions that extend beyond They are sometimes referred to Department of Commerce. In what is currently required by as “mother-in- law apartments.” addition to just meeting a statutory Washington State law. Cities must An ADU has all the basic facilities mandate, however, ADUs have act by April 1, 2021. needed for day-to-day living also helped local jurisdictions independent of the main home, meet their Growth Management such as a kitchen, sleeping area, Act goals to encourage affordable and a bathroom. housing and provide a variety of housing densities and types, while still preserving the character of single-family neighborhoods. From a planning perspective, it is considered by many to be a “kinder and gentler” method for accommodating population growth in a community, as compared to upzoning land to do so.

28 Standard ADU As a result, some communities • Allowing more than two regulations are considering changes to ADU dwelling units: A “cutting regulations, such as: edge” regulatory change is to Most local ADU regulations have increase the maximum number standards to address the following • Unit size: Most current ADU of dwelling units on a single- issues: standards set a maximum size family lot to three (by allowing (for example, 800 square feet), one primary dwelling unit, one • Maximum unit size but some communities are attached ADU, and one detached • Owner-occupancy considering an increase to their ADU). • Dedicated off-street parking limit to provide more flexibility. • Attached ADUs only • On-site parking: Some local Discussion about these types governments are looking at of changes has caused anxiety • Maximum number of dwelling a reduction or elimination of for some homeowners, who are units on one lot standards requiring on-site concerned about the impacts • Separate entrances/Only one parking spaces for the ADU’s on neighborhood character and visible from the street occupants, especially in areas property values. On the other side • Other design standards where there is adequate on- are affordable housing advocates (especially for detached ADUs) for street parking. Such a change who consider changing existing such items as roof pitch, window may face stronger opposition regulations as a way to effectively style, and exterior material in neighborhood where street increase the number of legal ADUs. parking is at a premium. • Maximum number of occupants • Detached ADUs: Most codes Regardless of how local • Minimum lot size only allow attached ADUs, but governments decide to regulate • Building code and other “life/ more communities are expanding them, ADUs may be a viable approach to address a community’s safety” requirements regulations to permit detached ADUs (which are usually required growth and affordable housing to be placed in the back half of a policies in a manner that is Communities reconsider residential lot). Even if allowed, acceptable to residents (especially ADU requirements the high cost of constructing if they consider the alternatives). Just be sure regulations and Some local governments in “backyard cottages” may limit the development review process aren’t Washington State and elsewhere are number that actually get built. so burdensome that property reexamining their “standard” ADU • Owner-occupancy: Most owners end up not creating these requirements and questioning the codes require that the property dwelling units or building an ADU rationale behind them, especially owner needs to occupy either without obtaining the required given the low production rate of the primary or accessory unit, permits. new accessory dwelling units. but some communities are considering removing this requirement.

29 Affordable housing A Regional Coalition for Housing (ARCH): 15 cities & a county working together

A Regional Coalition for Housing ARCH is governed by its member ARCH has led and supported a (ARCH) is a partnership of 15 cities cities, with an executive board variety of housing policies and in East King County and the county made up of the chief executive programs, notably the early government itself dedicated to officers of member cities. A adoption of inclusionary zoning advancing affordable housing in Citizen Advisory Board provides in several communities, surplus the region. Originally created in recommendations on local funding land programs, and encouraging 1992 following recommendations allocations, which are made regulatory flexibility to support of a citizens’ commission, ARCH through a Housing Trust Fund that diverse housing types such as supports member governments invests pooled funds into project accessory dwelling units. ARCH by developing housing policies, loans and grants. ARCH’s work staff also administer incentive and strategies, programs, and program and administrative budget inclusionary housing programs on development regulations; is determined annually by its behalf of members, and provide investing local resources in member cities. ongoing monitoring of housing affordable housing developments; created by city programs and administering affordable housing investment. On the capital side, programs; and assisting people ARCH helps cities pool resources looking for affordable rental and they allocate for affordable housing ownership housing. within the member cities. Cities are willing to co-fund projects through grants and loans with the long-term goal of creating affordable housing throughout East King County that serves a range of needs. ARCH also provides ongoing monitoring of housing funded by cities.

30 Affordable housing City of Bellingham housing levy

The Bellingham housing levy was Rental & transitional Rental assistance & approved by the voters in 2012, housing services and imposes a tax of 36 cents per The Bellingham Home Fund Bellingham allocates the Home $1,000 of assessed property value, supports the development of Fund, federal HUD funds, and city generating $21 million over seven new rental housing units for funds to support housing and social years for the Bellingham Home households that earn less than half services for low-income people Fund. The Bellingham Home Fund the area median income. Funds in the community. These funds provides safe, affordable homes have been used for critical repairs, also support rent subsidies and and supportive services to seniors weatherization and accessibility. emergency winter shelter. on fixed incomes, people with disabilities, veterans, and low- Some of the Home Fund’s major income families. An Administrative Homeownership initiatives include: and Financial Plan approved by the Since 2002, the City of Bellingham Bellingham City Council guides the has partnered with the Kulshan • Homeless Outreach Team use of the funds. Community Land Trust and, more recently, with the Washington (Whatcom Homeless Service Center) In 1995, the Washington State State Housing Finance Commission Legislature enacted RCW 84.52.105, to help with down payment and • Intensive Case Management which authorizes cities, counties closing costs for low-income (Whatcom Alliance for Health and towns to impose an additional households. Since 1977, the city has Advancement) offered financial assistance to low- regular property tax levy of up to • Housing Services (Lydia Place, income homeowners to repair their 50 cents per $1,000 of assessed YWCA, Domestic Violence homes. In 2013, the Bellingham value of property for up to ten and Sexual Assault Services, Home Fund allowed the city to consecutive years. The ability to Northwest Youth Services, support expanding the Opportunity propose a levy under this statute Opportunity Council, and Catholic Council (a private, nonprofit requires a city, county or town to Community Services) declare an emergency with respect Community Action Agency serving to the availability of affordable homeless and low-income families housing. and individuals) services to repair and weatherize owner-occupied manufactured homes.

31 Affordable housing Community Land Trusts

Community Land Trusts (CLTs) rate. Even if property values in the and other interested community are nonprofit organizations that area skyrocket, the home remains members. provide affordable homeownership comparatively affordable forever. by placing land in a trust so that CLT homeowners may make further home buyers pay only for the cost CLT homeowners may still build improvements to their houses of the structure. The CLT home equity, within the agreed limits, just as any homeowner would. buyers lease the land from the and use that equity to move up the Homeowners reap all the tax nonprofit for a modest fee. economic ladder. benefits of homeownership and can leave the home to their heirs or There are currently over 225 CLTs A CLT balances the multiple goals anyone else they designate. in 38 states. Thirty CLTs have been of asset-building for low- and established in the Pacific Northwest, moderate- income households, Community Land Trust homes may with 17 in Washington. CLTs have preservation of affordability include both discrete developments proven to be a very effective model over time, and the protection of in a neighborhood and scattered in Seattle, Bellingham, Spokane, neighborhood vitality. CLTs have site programs where homeowners Portland, and other communities an established track record of very find a home they wish to purchase, around the country. low default rates. In 2008, CLTs and the property is brought into had a foreclosure rate of 0.52% the CLT as part of the purchase A CLT must have property in order nationally, compared to over 3.3% process. to offer building sites, either in the for conventional homebuyers. form of land for construction or existing homes. Land acquisition Often, a portion of CLT board seats may be from available public are reserved for homeowners. property, or purchased with funds In the Spokane CLT, for example, from grants, special levies or homeownership confers eligibility donations. for membership in the organization. One-third of the board of directors CLTs make home ownership more are homeowners, joining local attainable for low-income families housing advocates, city officials, by removing the cost of land from the purchase. In a “hot” housing market, the increasing land value is a substantial part of the cost of a home; by removing that cost, the CLT is able to sell the homes at below-market rates.

The housing remains permanently affordable by limiting equity gains, which preserves the home’s affordability for future owners. In exchange for purchasing a home at well below market rate, CLT homeowners agree to a limit on the amount of equity they can realize if they sell the home in the future. An agreed-upon formula caps their equity growth at a reasonable

32 Affordable housing Inclusionary zoning: Mandatory programs

One method for addressing the Who uses inclusionary Elements of Inclusionary affordable housing problem is zoning Zoning use of a regulatory tool called More than 500 cities in the Mandatory inclusionary zoning “inclusionary zoning.” Inclusionary U.S. use inclusionary zoning, regulations usually specify the zoning requires affordable units to including Boston, Denver, New following: be included within new residential Orleans, Portland, Sacramento, development projects, or payment San Francisco, San Diego, and • Minimum quantity of affordable made for construction of such units Washington D.C. In Washington units to be provided, which elsewhere in the community. State, there are a few cities that use is usually a percentage of a inclusionary zoning, and more that development’s total number There are two basic types of are actively considering it. of dwelling units. For example, inclusionary zoning: voluntary Redmond requires a minimum and mandatory. Under a voluntary Successful examples in Washington of 10%, while Sammamish has program, it is up to the developer State are Redmond and Federal a sliding scale, based on the to decide whether or not to use Way. Redmond’s affordable housing affordability level of the provided various incentives or bonuses in regulations, which have been in housing units. Developers in exchange for providing a specified place since 1995, provide long-term Sammamish are also using the number of affordable units. affordable “contracts” on nearly 500 city’s affordable housing “bonus However, such programs are not dwelling units. The City of Federal pool” to produce more market- used very often, with developers Way has also created a sizable rate and affordable dwelling usually opting to choose the amount of affordable units through units. simpler path of building only its inclusionary zoning provisions. market-rate housing. • Targeted income range of households to be served by the Conversely, a mandatory program affordable units. For instance, requires the construction of a Redmond’s target population minimum number of affordable is “those who make equal to or units or an “in lieu of” payment. less than 80% of the King County Communities with a mandatory median household income program usually provide an adjusted for household size,” additional density bonus if the number of affordable dwelling units goes beyond the mandated minimum. This article focuses primarily on mandatory programs.

33 while Federal Way defines “rental Pros & cons of Legal basis for affordable housing” as dwelling inclusionary zoning inclusionary zoning units affordable to those with In an active housing market, State law (RCW 36.70A.540) incomes at or below 50% of King inclusionary zoning results in the provides authority for GMA County’s median income. production of more affordable cities and counties to establish • Time period within which housing for low- and moderate- mandatory requirements for the the designated units must be income residents. Inclusionary inclusion of affordable housing maintained as affordable. For zoning can also result in buildings under certain circumstances. example, Issaquah requires those and neighborhoods that have a mix That statute allows a GMA city units to remain affordable for a of income levels, without having to or county to require a minimum minimum of 50 years. rely on taxpayer funds to provide number of affordable housing • Geographic scope of such them. units that must be provided by all regulations. Inclusionary zoning residential developments in areas is usually limited to designated On the “con” side, it is important where the city or county decides to areas such as a downtown or to tailor your program to fit your increase residential capacity. Before mixed-use development areas, local housing market. If the market establishing such a requirement, a although they may be applied is not strong enough, mandatory city or county must determine that throughout your community. affordability requirements could such a zone change would further For example, Redmond includes cause developers to not to build local growth management and its downtown and seven other any residential housing, which may housing policies. neighborhoods, while Issaquah’s exacerbate the affordable housing mandatory program is limited to issue. Cities should review the The pros and cons of inclusionary the Central Issaquah Urban Core. programs of their peers to consider zoning should be carefully reviewed administrative and monitoring before implementing such a responsibilities. program. But, if your community On a practical note, a local has an affordable housing problem government should ensure that and strong demand for market-rate the increased development housing, it is a regulatory tool that capacity resulting from an upzone should be considered. will offset the added costs to the housing developer of providing the affordable units. Otherwise, neither the market-rate nor affordable housing units will be built.

34 Affordable housing Multifamily tax exemption: An incentive to help create affordable housing

Washington cities with populations When a project is approved under If the property use changes before of 15,000 or more may establish a this program, the value of eligible the applicable exemption ends, tax exemption program to stimulate multifamily housing improvements back taxes are recovered based on the construction, rehabilitation, or is exempted from property taxes the difference between the taxes conversion of existing structures to for eight or 12 years. Land, existing paid and the taxes that would provide multifamily housing within improvements, and non-residential have been paid without the tax city- designated areas, including improvements are not exempt. Only exemption. affordable housing (see RCW 84.14). projects with four or more units are eligible for either the eight or Several cities have adopted Cities in “buildable lands” counties 12-year exemption. The eight-year multifamily property tax exemption under RCW 36.70A.215, and tax exemption applies to market- ordinances including Auburn, the largest city in a Growth rate housing, and the 12-year tax Bellevue, Everett, Renton, Spokane, Management Act (GMA) county abatement is available if 20% of Seattle, Bremerton, Wenatchee, where no city has 15,000 or more the project’s units are affordable to Bellingham, Shoreline, Kent, residents may also utilize the tax families earning up to 115% of the Tacoma, Vancouver, and Lynnwood. exemption program. area median income. The Seattle Multifamily Tax Only property owners who commit Exemption program is applicable to to renting or selling at least 20% of new multifamily buildings that set units as affordable housing for low- aside at least 20% of the homes as and moderate-income households income- and rent-restricted for 12 are eligible for a 12-year exemption. years. As of 2017, 306 properties are The property must satisfy that participating in the program. commitment, and any additional affordability and income eligibility conditions adopted by the local government under this chapter.

35 Affordable housing Bremerton addresses housing affordability & chronic homelessness

The City of Bremerton is working seniors and low-income home life skills training. The Bremerton to expand their assistance to residents so they can stay in their Housing Authority is providing seed low-income residents and to help homes. funding of $3.1 million to pave the the chronically homeless facing way for other financing needed addiction and mental health issues. Following the passage of HB to build the facility. The Housing 1406 in the 2019 legislative Authority will also help with Bremerton has seen demand session, the city is pursuing the ongoing costs. increase for affordable housing and sales tax credit for supplemental services in recent years. Figures funding of the rental assistance Remaining funding will come estimate that half of renters in and weatherization programs. from federal low-income housing the city pay more than 50% of Purchasing land and building tax credits, grants, and private their income in rental payments. a large supply of new units can foundation requests to build the Additionally, chronically homeless be costly. The support from HB complex. Once Pendleton Place is individuals who face addiction and 1406 for rental assistance and completed, residents will pay 30% mental health issues struggle to weatherization will reach more low- of their income in rent to assist with keep their housing. Kitsap County’s income renters and homeowners operating costs. 2019 point-in-time homeless count across the city. indicates that some of the most The long-term goal of Pendleton common causes of homelessness Land acquisition Place is to help homeless are mental health issues, as well as individuals with supportive services addiction. assistance so they can successfully move into Bremerton is also working to more permanent housing, improve The City of Bremerton has address its chronic homelessness their health and well-being, and implemented a two-pronged for persons struggling with mental reduce impacts on medical services. approach to address affordability health and addiction issues. Construction of the $18.3 million and chronic homelessness— The city, in partnership with the complex is expected to begin in helping to keep people in their Bremerton Housing Authority and September 2020 and residents homes and expanding access to Kitsap Mental Health, has proposed should begin moving in by the fall mental health care and substance a 70-unit apartment building called of 2021. abuse treatment. Pendleton Place. Because lack of housing directly impacts the ability Special thanks to Jennifer Hayes, City to seek and respond to treatment, Rental assistance & of Bremerton, for submitting this the facility will deliver on-site article! weatherization services such as mental health care The city’s 2019 budget funded and treatment for substance abuse, $200,000 for rental assistance along with permanent housing for and weatherization upgrades for vulnerable residents. low-income residents. The rental assistance program, administered To get the program started, the city through the Bremerton Housing helped locate and rezone a 1.66- Authority, offers help with short- acre site for development of the term rent payments, eviction Pendleton Place apartment units in prevention, and security deposits. an area designated for affordable The city’s weatherization and minor housing. Kitsap Mental Health will home repair program, administered provide around-the-clock support; through Kitsap Community and community partners will Resources, provides help to lower offer treatment and primary care energy bills—reducing costs for services, employment search, and

36 Affordable housing Down payment assistance programs

For many Washington families, Success stories Tacoma saving enough money for the The following are some program The City of Tacoma has helped required down payment to buy a highlights from current WSHFC more than 40 families with incomes home continues to be the biggest partners offering down payment of 80% or less of area median obstacle to homeownership. The assistance to their residents. income within Tacoma to purchase Washington State Housing Finance their first home. This program, in Commission (WSHFC) offers Bellingham partnership with the City of Tacoma several models of down payment Starting in June 2017, the City of Redevelopment Authority, started assistance to help bridge the gap, Bellingham helps borrowers with in June 2014. and all programs can be used to pay incomes of 80% or less of area for both the down payment and median income within the city to Pierce County closing costs. purchase their first home. Pierce County serves borrowers with incomes of 80% or less of Many local jurisdictions would like Seattle area median income within Pierce to help homebuyers in their area, Since March of 2004, the City County (outside of Tacoma city but the costs and hassles of running of Seattle has assisted over 400 limits) to purchase their first home. an independent down payment families with incomes of 80% or This program is in partnership with assistance program are a significant less of area median income within the Pierce County Community barrier. Five government entities— Seattle to purchase their first home. Development Corporation and three cities, one county, and one began in June of 2017. consortium—are partnering with A Regional Coalition for Housing WSHFC to make the most of their (ARCH) local resources. WSHFC administers Created in October of 2005, ARCH Resources the programs and matches the local is a partnership of King County and www.heretohome.org funds with larger sources. East King County cities to preserve and increase the supply of housing. Advantages for city partners: ARCH has assisted more than 60 families with incomes of 80% or less Special thanks to the Washington • Lowers cost for cities—no of area median income within East State Housing Finance Commission administration fees from WSHFC King County to purchase a home. for submitting this article! • Matching funds from WSHFC • Cities keep their funds in their jurisdiction or targeted to a specific population • Cities leverage WSHFC’s funds and experience with administration

To establish a partnership, the local jurisdiction must sign an interagency agreement with WSHFC and receive approval for matching funds. The two agencies work out a program description, manual, forms, and administrative requirements, including reporting.

37 Affordable housing Tiny homes

Tiny homes are all the rage these Changing regulations of SB 5383 defines “tiny house” and days. But if they are so popular, then tiny houses “tiny house with wheels” as a why don’t we see more tiny homes dwelling to be used as permanent Before the passage of SB 5383, in our communities? housing with permanent provisions relevant state law and local for living, sleeping, eating, and regulations dealt primarily with The simple answer is that zoning sanitation in accordance with the camper trailers and recreational and building/construction state building code. Other key vehicles (RVs) that are used on regulations have created significant components include: a temporary basis, and not tiny barriers against them, especially homes intended for permanent if someone wants to live in a tiny • The new law allows the creation occupancy. Accordingly, most home on a permanent basis. of tiny house communities zoning codes treat such tiny However, Washington passed a through the use of binding site homes as camper trailers or RVs, new law (SB 5383) in 2019 which plans. These communities are and usually allow them only for expands where tiny homes can subject to the Manufactured temporary, recreational use in locate as a permanent residence Home Landlord-Tenant Act campgrounds, RV parks, and and establishes building codes (MHLTA) RCW 59.20. occasionally in mobile home parks. specific to tiny homes. • Cities or towns may adopt an ordinance to regulate tiny house communities. • The owner of the land upon which the community is built shall make reasonable accommodation for utility hookups for the provision of water, power, and sewer services and comply with all the other requirements in MHLTA. • Cities or towns cannot adopt ordinances that prevent tiny homes from locating in manufactured home parks as a permanent residence, unless the ordinance applies to an exception in RCW 35.21.684(4). • The Washington Building Code Council must adopt building code standards for tiny houses by December 31, 2019.

38 Tenant protections Rental housing inspection programs

Several cities have adopted rental pursuant to RCW 59.18.125 (see and added to the RHSP database. housing safety programs to help box), to improve and protect the Property owners were able to ensure that rental units offered to welfare of its residents. “opt-out” of the RHSP database if tenants are safe. Rental housing the property met an exemption safety programs protect low- Since the launch of RHSP in standard. income residents by requiring late 2017, an astounding 80% property to owners meet health of all rental units in the city are The RHSP is predominately and safety standards in order to registered. The program’s high automated. Using an online data rent out their units. compliance rate is largely attributed portal, property owners can to the innovative “opt-out” design register, inspectors can enter One example is Lakewood, which of the program’s database. The city inspection results, and the city has approximately 13,000 rental learned from other jurisdictions that can send renewal notices, collect properties (out of 24,000 total program compliance was often an payments, and issue certificates of occupied housing units). While issue. These jurisdictions primarily compliance. The city intends for the some of this housing meets basic used an “opt-in” approach, i.e., rental program to be self-financing (100% life and safety standards, the property owners self-identified cost-recovery) soon. troubling fact is: a lot does not. and registered rental properties. The City of Lakewood dedicated The “opt-in” approach requires During the first year of the program, significant resources into reactive, that rental property owners are: 1) city and private inspectors complaint-driven inspection knowledgeable of the program, and examined 1,685 units and found programs. However, even with 2) law-abiding. The city decided to that 83% of the units failed their these programs in place, some take an alternative approach using first inspection—commonly of the more challenging (and available county data. The city for minor safety issues, such as common) examples of unsafe and compared taxpayer addresses with missing outlets and insufficient substandard living conditions go the physical address of properties carbon monoxide detectors. Of unresolved. To help bridge this within Lakewood. Properties with these units, 92% passed their gap, the city launched the Rental different addresses were identified second inspection. To date, due to Housing Safety Program (RHSP), as potential rental properties unresolved health and safety issues, the city has closed seven rental units and relocated 15 individuals.

The RHSP has spurred reinvestment Did you know? into the city’s existing housing RCW 59.18.125 was added to the state’s Landlord Tenant Act (RCW stock, which increases local 59.18) in 2010. The law authorizes a municipality to require certificates sales and use tax and bolsters of inspection from landlords, and requires that cities adopting a rental the local economy. Through this inspection/licensing ordinance after June 10, 2010 follow the regulations reinvestment the city hopes to provided in the statute. protect existing affordable housing in the city. In 2007, before this law was adopted, the State Supreme Court upheld a City of Pasco ordinance that required landlords to be licensed by the city, make inspections of their rental units, and furnish the city with a certificate of inspection verifying that their units met applicable building codes. A key element in the court’s decision in City of Pasco v. Shaw Resources was that the inspections could be performed by a private inspector of Lakewood’s Rental Housing the property owner’s choosing. This provision is also a feature of RCW Safety Program (RHSP) 59.18.125. rentalhousing.cityoflakewood.us

39 Tenant protections New tenant protection laws

The 2019 Washington State HB 1462 requires a landlord to In 2018, the Legislature passed a Legislature followed the lead of provide at least 120 days’ written law prohibiting source of income many cities and passed several notice to a tenant whenever discrimination by a landlord against laws focused on tenant protections the landlord plans to demolish a tenant who uses a federal, state, under the Residential Landlord or substantially rehabilitate or local benefit or subsidy to pay Tenant Act (RLTA). Collectively, the premises or plans a change of rent. Prior to passage, ten cities goal of these laws is to prevent use of premises. This requirement in the state had passed source of homelessness, given the shortage does not apply with respect to income discrimination ordinances. of vacant rental housing across the jurisdictions that have created a state. relocation assistance program and otherwise provide 120 days’ notice. Resources Per HB 1440, a landlord must Source of income provide each affected tenant a SB 5600 made numerous changes discrimination – RCW minimum of 60 days’ prior written to the RLTA. The relevant changes 59.18.255 notice of an increase in the amount included additional time between of rent, and any rent increase nonpayment of rent and the start of Rent increase timelines - RCW may not become effective before eviction proceedings, and limited 59.18.140 the end of the term of the rental judicial discretion to reinstate a Rehabilitation notice agreement. In the case of a rental lease in specific circumstances. requirements - RCW 59.18.200 agreement governing subsidized Under the eviction timeline, a tenancies where the rental amount landlord must now provide a Residential Landlord Tenant is based on the income of the tenant 14-days’ notice instead Act RCW 59.18 tenant or circumstances specific of 3-days’ notice for a tenant to to the subsidized household, the pay overdue rent prior to starting landlord must provide 30 days’ prior eviction proceedings. The uniform notice of the rent increase and the 14-days’ notice does not abolish any rent increase may become effective additional notice requirements to at the end of the rental term or tenants as required under federal, sooner upon mutual consent. local, or state law.

40 Innovative collaboration Addressing chronic homelessness in Everett with CHART

The City of Everett created To do so, CHART coordinates contacts and a 90% reduction in jail the CHronic-Utilizer Alternative the efforts of more than 30 days. Response Team (“CHART”) in 2015, organizations to address the needs to address chronic homelessness. of individuals with complex social In 2019, CHART began an effort to This group consists of criminal and behavioral health challenges. translate this early success into a justice, emergency response, and This program focuses on reducing sustainable model with evidence- research partners from the Everett frequent contact with jail, police, based program fidelity, expanded impact, and proven financial Police Department, Everett Fire courts, fire department, and viability. The primary three steps of Department, Snohomish County emergency department by those this effort are to: Department of Human Services, individuals by coordinating care, Snohomish County Jail, Everett City finding housing, and reducing 1. Transfer administrative and Attorney’s Office, and Providence harm. backbone support from the city Regional Medical Center Everett. to a community organization While the program remains Some chronically homeless people already working with this relatively small, CHART is achieving population; with mental illness, addictions, and better outcomes for participants, other disabilities are heavy users of and reducing the impacts and 2. Engage a research partner to emergency rooms, police services, expenses of those who frequently establish data collection and and the criminal justice system – cycle through the system. The program evaluation; and and they often cycle through these 36 individuals assisted thus far 3. Solidify partnerships among services and back onto the streets. represent the most challenging participating community They suffer from mental health and and costly users of valuable organizations. substance-abuse disorders, and public safety resources. In 2016, typically have been homeless for a small-scale study of the first extended periods of time. six individuals showed an 80% reduction in EMS and police CHART seeks to divert people from this expensive and unproductive cycle.

Photo credit: Photo City of Everett

41 Innovative collaboration Lakewood nonprofits & government tackle affordability & homelessness together

Pierce County’s annual point-in- In partnership with Greater Lakes Lakewood also partners with time count revealed that there Mental Health, the city hired a multiple local organizations to were 1,486 people experiencing mental health professional who is address homelessness and mental homelessness in January 2019 in embedded with police officers to health, including Living Access the county. The number of people serve as a resource for those who Support Alliance (LASA), Habitat for in shelters and on the streets are suffering from addiction or Humanity, Western State Hospital, decreased 9% since 2018. mental illness. A full-time officer and the Tacoma Methadone Clinic. now supports the Behavioral The city contributed almost $1 Individuals reporting either Health Contact Team (BHCT). In million to LASA to support their Lakewood or Tacoma as their 2018, the BHCT connected with new shelter, which opened in location during the count made 228 new clients and helped with July 2015. In addition, the city up 6% of the county’s unsheltered 102 re-entries. As of August 2019, helped Habitat for Humanity fund population and 15% of those the BHCT connected with 117 construction of new houses for residing in shelters. new clients and helped with 46 low-income, first-time home buyers. re-entries. Without the BHCT these To date, the organization has The City of Lakewood adopted individuals would otherwise have built over 30 units in the Tillicum a multifaceted approach to been incarcerated or hospitalized. neighborhood. The organization addressing both housing The city regularly shares their has a goal of building 41 units in affordability and homelessness in experience and knowledge gained the area. Habitat is also looking the community. One percent of the through this program with other to add additional properties to its city’s general fund is allocated to local cities interested in establishing Tillicum portfolio. Additionally, support human and social services similar programs for their Lakewood helps fund shelters annually, including housing communities. through Catholic Community assistance and housing relocation Services and YWCA of Pierce programs. The city has also tried County. These organizations other approaches that complement provide access to emergency this budget allocation. housing and support services. Every month the city hosts a community collaboration meeting with the above-mentioned organizations, as well as community members, to meet and discuss how to effectively work together to tackle complex issues facing residents in the city, such as affordability and homelessness.

The city is part of a consortium, called the Continuum of Care, with Pierce County and the City of Tacoma that qualifies for federal Community Development Block Grant dollars to support other programs to address homelessness countywide.

42 Another example of collaboration In 2017, the city launched the The City of Lakewood estimates with Pierce County is shared use of Rental Housing Safety Program that low-income housing accounts document recording fee revenue, (RHSP) in effort to ensure the safety for over 65% of homes within which supports affordable housing of city rental units. RHSP requires Lakewood, making the city a cost- and homelessness programs. property owners to meet health effective location for Pierce County Funding is distributed by an and safety standards in order to to place individuals who participate oversight committee composed rent out their units. Lakewood in rental assistance programs. of members from the City of has approximately 12,993 rental Lakewood is also home to other Tacoma, City of Lakewood, Pierce properties (out of 24,140 total low-income options including 28 County, and other city and town occupied housing units). In the mobile home parks (1,180 units) representatives. An interlocal past, the city dedicated significant and 388 apartment complexes agreement governs the operations resources into reactive, complaint- (11,200 units), the majority of which of this committee. driven programs. However, serve low-income residents. The even with these programs some city also hosts other low-income of the more challenging, and and transitional housing programs common, examples of unsafe and such as the Pierce County Housing substandard living conditions Authority and units built using remained unresolved. To help federal tax credits. bridge this gap, the City created the RHSP, pursuant to RCW 59.18.125, to improve and protect the welfare of its residents. Since the launch of RHSP, an astounding 80% of all rental units in the City are registered. (See more on rental housing inspection programs on pg. 39).

43 Innovative collaboration Taking a team approach to help people struggling with homelessness & behavioral health

Many local governments Seattle’s Navigation Team Snohomish County’s recognize that a multi-service operates seven days a week and Homeless & Direct team approach is more helpful is made up of outreach workers to people living on the streets, as from REACH, System Navigators, Outreach team is a they often have a variety of needs. and specially trained Seattle Police partnership between the county’s Approaches vary, but the impact Department personnel. Their aim Office of Neighborhoods and law is notable. Some cities use human is to connect people who are enforcement. The team is led by a services grants to fund outreach living unsheltered to resources police sergeant and includes Law programs administered by other and shelter, and to remove Enforcement Embedded Social organizations, while others have unauthorized encampments from Workers (LEESWs). Together, this hired staff for their own outreach public property. team assists people experiencing teams. Most of these teams include homelessness, those with mental illness, and frequent jail utilizers, both mental health professionals Redmond’s outreach and law enforcement that work connecting them with services and together in the field, commonly program employs a full-time diverting them from more jail time. called a “co-response” program. specialist who works alongside neighborhood resource officers on Behavioral health and public safety The following is a list of five the city’s bicycle unit. The specialist experts are beginning to recognize local governments’ varying team is available via police radio to that the traditional criminal justice approaches to implementing their respond to homeless-related calls system is not properly equipped to own local co-response programs. for service. The program’s main successfully address many of the purpose is to connect people to issues facing residents living on city Olympia’s Crisis Response services and resources. streets. Although somewhat new, in many cases programs like these Unit has six behavioral health Mount Vernon’s Problem are more successful at connecting specialists working in the field individuals to appropriate services who are trained to de-escalate Eliminations & Reduction and promoting better outcomes. situations, evaluate needs, and Team (PERT) is a mayor- connect people with services initiated program made up of staff voluntarily. The team members from code enforcement, police, Resources get to know residents living on sanitation, parks, fire, library, www.etsreach.org the street and assist by giving development services, and legal. www.mountvernonwa.gov bus passes, delivering necessities Unlike some other programs, the like diapers and blankets, or by team is not an external outreach driving them to medical services or group; but rather works together shelters. internally to address homelessness issues in the community that affect all departments. The group constructed a workplan including budget and staff time estimates, progress notes, and measurements or deliverables.

44 Innovative collaboration Wenatchee coordinates homeless programs for two counties

In 2006, Chelan County and The City of Wenatchee administers The Task Force’s efforts are guided Douglas County combined forces the homeless programs by a regional homeless plan that to reduce the prevalence of in compliance with grant is updated every five years. The homelessness. They chose the City requirements and coordinates 2019-2024 Chelan-Douglas Homeless of Wenatchee to serve as the lead services among providers. The city Housing Strategic Plan is currently in entity overseeing the development is assisted in its work by the Chelan- development and will be published and administration of the counties’ Douglas Homeless Task Force and on December 1, 2019. A current homeless plan. the Chelan-Douglas Homeless draft of the plan identifies the Advisory Committee. The Homeless following priorities: The city manages local and state Task Force provides policy oversight homeless and housing funds on and determines funding allocations, 1. Increase capacity and strengthen behalf of Chelan County, Douglas and is composed of representatives practices to prevent housing County, and the City of East from local governments, community crises and homelessness; Wenatchee through an interlocal organizations, business groups, 2. Identify and engage all people agreement. The city also manages the media, and public citizens. The experiencing homelessness as funds distributed through the Advisory Committee is composed quickly as possible; Department of Commerce’s of homeless service providers Consolidated Homeless Grant and other interested parties who 3. Provide access to temporary (CHG). Wenatchee is not a provider coordinate how homeless services accommodations to all of direct services, but instead work in the counties. unsheltered people experiencing subcontracts for services by local homelessness who need it; service providers through subgrant The city manages approximately 4. Streamline and improve the agreements. $1.5 million in grant money coordinated entry process and annually. The Task Force maintains its connections to housing and a cash reserve balance of $150,000 services; and an emergency reserve fund of 5. Assist people to move swiftly $100,000. into permanent housing with appropriate and person-centered services; and 6. Prevent returns to homelessness through connections to adequate services and opportunities.

Specific activities and performance metrics for each of these priorities are currently being developed and will be included in the final version of the homeless plan.

45 46 47 48 Association of Washington Cities 1076 Franklin St. SE Olympia, Washington 98501-1346 360.753.4137 or 1.800.562.8981 wacities.org

Municipal Research and Services Center 2601 Fourth Ave., Suite 800 Seattle, Washington 98121-1280 206.625.1300 or 1.800.933.6772 mrsc.org