2021 Legislative Preview

With less than a month until the start of the (virtual) 2021 Washington State Legislative session, let’s take a deep dive into affordable housing issues that the Legislature will be considering and what Habitat for Humanity will be working towards.

The COVID-19 crisis has laid bare the fragility of housing stability in our region. Advocates are noting that more than 10% of Washington renters are behind or unable to pay their rent. This number significantly increases when we focus on low-income renters – those households earning below 80% of the area median income. To avoid a spike in evictions and allow the legislature to develop budget and policy to address this issue, we expect Governor Inslee to extend the eviction moratorium into the late winter/early spring. We also anticipate legislation to create a funding source to provide assistance for low-income renters to ensure they are able to maintain their housing. We’ll have more updates on our advocacy blog on this as we move into the legislative session.

The pandemic has also made even more clear our state’s need for additional affordable housing. The Washington Department of Commerce is requesting a $240 million investment in the state’s Housing Trust Fund (HTF). This funding source provides capital to develop affordable housing units. Tacoma Habitat has used the HTF on numerous occasions over the last 12 years, most recently to help fund our Tyler Court development.

The Legislature has also made racial equity legislation a priority for the 2021 session. This is an important topic in the housing and land development industry, and we are proud of the Legislature for prioritizing this work. A recent presentation during a Tacoma City Council study session noted an alarming disparity between Black and white households homeownership rates in the City of Tacoma. Black households have a 30% homeownership rate, while white households rank at 61% homeownership. Tacoma Habitat and Habitat for Humanity of Washington State, will work with legislators to create a formal workgroup, with a goal of developing budget and policy recommendations for the Legislature to enact to close these troubling disparities.

It may be of interest to note that over the last 12 years more than 60% of Tacoma Habitat’s homebuyers have been households of color, and Black households make up more than 30% of our buyers.

During the session, there will also be work done to update the state’s multifamily property tax exemption program (MFTE). This program provides options for eligible municipalities to incentivize housing and affordable housing development through a property tax exemption tool. The tool exempts the value of improvements made to a multifamily property for either 8 or 12 years. To qualify for the longer, 12-year, exemption a developer must meet a minimum affordable unit threshold; the state’s minimum threshold is 20% of the units, but local municipalities can employ a higher minimum standard. Habitat for Humanity is working with a wide array of partners to propose a number of updates and reforms to the program. The desired MFTE program improvements include:

1. expanding the program to more cities, towns, and counties in Washington,
2. creating a pathway to allow 8 and 12 year projects to opt into a second 12 year exemption if they meet the minimum affordable unit criteria,
3. adding flexibility to the program to allow ‘missing middle’ type housing like duplexes and triplexes to qualify for the exemption, and
4. creating a longer exemption for affordable homeownership units to allow developers to serve more low-income households.

Updating the MFTE in these ways will extend the affordability of units, create more housing and affordable housing opportunities, and allow organizations – like Habitat for Humanity – to maximize the density on buildable land, adding to our affordable housing stock.

These are just a few of many housing topics that will be covered during the 2021 Legislative session.

Want to know more? Join us on January 8th for a special Cost of Home: Legislative Session Preview with Senator Mona Das (47-Kent) and Representative Mari Leavitt (28-University Place) to break down what to expect and how to participate in the virtual session. Register for this event, sponsored by BCRA, HERE.

Make sure to check our blog during the legislative session and sign-up for our advocacy alerts so you can stay on top of our work in Olympia, and learn about how you can participate.