State Lawmakers Just Missed a Huge Affordable Housing Opportunity—By One Day

Seattle needs 27,500 more low-income housing units by 2030, according to the Housing Development Consortium. Sherron L. Pratt/getty

Last night, Washington State lawmakers finally struck a deal on a $4.3 billion construction budget. The budget has been delayed for months, tied up with a complicated partisan fight over water rights. In the end, nobody seems that happy with the water rights outcome. "Everybody is unhappy with it fairly equally," Senator Kevin Van De Wege told the Tacoma News Tribune. But finally getting a construction budget, also known as a capital budget? That's a big fucking deal for affordable housing advocates.

The budget includes $106.77 million for the state Housing Trust Fund, which helps fund subsidized and supportive housing. Supportive housing, which has services on site for people who are chronically homeless or have disabilities, is key to solving the state's housing and homelessness crisis. And there's not nearly enough of either supportive or subsidized housing. According to the Housing Development Consortium, Seattle alone will need nearly 27,500 more housing units by 2030 to serve people with the lowest incomes (lower than 30 percent of the area median or $28,800 for a family of four).

Laurel Turner, executive director of the Women’s Resource Center in Wenatchee, says her organization is currently seeking Housing Trust Fund dollars for a 20-unit supportive housing project for people who are chronically homeless, have a disability, and make less than 30 percent of area median income. “The highest barrier, hardest to serve,” she says. Turner says Wenatchee has a vacancy rate of less than 1 percent and people wait months for subsidized housing. Waiting for the capital budget has taken a toll, Turner says.

“People in our industry tend to be pretty optimistic,” Turner says, “but it’s been pretty gloomy. I know I’ve lost a lot of sleep.”

Along with the Housing Trust Fund, the budget will direct about $10 million toward rural home weatherization programs, which help low income homeowners improve things like heating and insulation. The budget also includes $861 million for higher education projects, $350 million for water quality projects $85 million for mental health facilities, and $15 million for low-income dental care, according to Senate Democrats.

"It is a really, really important budget for the lowest income folks in Washington State," says Michele Thomas, a lobbyist for the Washington Low Income Housing Alliance.

The bad news is that the long delay in approving a final capital budget will cost affordable housing providers because with more time, borrowing and construction times will go up. The delay also caused affordable housing developers to miss an important deadline for getting dollars to build.

The federal Low-Income Housing Tax Credit is a key source of affordable housing funding used to match state and local dollars like the Housing Trust Fund. But to get those credits, housing projects have to be otherwise fully funded. The state Housing Trust Fund is often a source of that necessary funding. The state agency that distributes the federal credit set a January 17 deadline for applications. As January 17 came and went without the capital budget cash for the Housing Trust Fund, some affordable housing developers were forced to miss that deadline because they couldn't show the needed funding for their projects. Now Thomas says those low-income housing developers are "on pins and needles about what is the next step."

The Washington Low Income Housing Alliance is calling on the state Department of Commerce and the Washington State Housing Finance Commission to figure out some sort of solution. In total, the Housing Trust Fund and the Low Income Housing Tax Credits could help build and preserve 3,066 units of affordable housing, according to the Washington Low Income Housing Alliance.

Governor Jay Inslee is expected to sign the capital budget. It's not clear when affordable housing developers will get clarity on the future of their tax credit applications.