HomeMy WebLinkAboutCOW 2020-03-23 Item 3B - Resolution - House Bill 1406 and Sales Tax Revenue Program for Affordable HousingCOUNCIL AGENDA SYNOPSIS
---------------------------------- Initials
Afeefinga Date
Prepared by
Mayor's review
Council review
03/23/20
MS
04/06/20
MS
ITEM INFORMATION
ITEMNO.
STAFF SPONSOR: MEREDITH SAMPSON
ORIGINAL AGENDA DATE: 03/23/20
AGENDA ITEM TITLE HB 1406 Revenue Spending Options
CATEGORY ® Discussion
,Utg Date 03123120
❑ Motion
Utg Date
® Resolution
Utg Date 04106120
❑ Ordinance
Utg Date
❑ Bid Award
Utg Date
❑ Public Hearing
Utg Date
❑ Otber
Utg Date
SPONSOR ❑Council [:]Mayor ❑HR ®DCD ❑Finance ❑Fire ❑TS ❑P&R ❑Police ❑Pik ❑Court
SPONSOR'S Tukwila passed Resolution No. 1966 and Ordinance No. 2316 with an effective date of
SuMNzARY November 1, 2019 to impose the Affordable Supportive Housing State Shared Tax
authorized by HB 1406. Tukwila must now decide how to spend that revenue, whether it be
pooling the revenue with SKHHP, keeping the revenue to be used on affordable housing
initiatives in Tukwila, or a combination of the two.
REVIE','ED BY ❑ Trans&Infrastructure ❑ CommunitySvs/Safety ❑ Finance Comm. ® Planning/Economic Dev.
❑ LTAC ❑ Arts Comm. ❑ Parks Comm. ❑ Planning Comm.
DATE: 03/02/20 AND 3/16/20 COMMITTEE CHAIR: MCLEOD
RECOMMENDATIONS:
SPONSOR/ADMIN. Department of Community Development
COMMITTEE Forward to Committee of the Whole
COST IMPACT / FUND SOURCE
EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
Fund Source:
Comments:
MTG. DATE
RECORD OF COUNCIL ACTION
03/23/20
Forward to next Regular Meeting
04/06/20
MTG. DATE
ATTACHMENTS
03/23/20
Informational Memorandum dated 03/02/2020 (updated after 3/2 PED Committee)
House Bill 1406
SKHHP Resolution No. 2019-06
Notice from Department of Revenue
Resolution in draft form
Minutes from the March 2 & March 16 PED Committee
04/06/20
Final Resolution
43
City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO:
Planning & Economic Development
FROM:
Minnie Dhaliwal, Deputy Director of Department of Community
Development
BY:
Meredith Sampson, Associate Planner
CC:
Mayor Ekberg
DATE:
March 2, 2020 (updated March 16, 2020)
SUBJECT:
HB 1406 Investments in Affordable Housing, Revenue Options
ISSUE
How does Tukwila want to allocate revenue received from HB 1406?
BACKGROUND
During the 2019 legislative session, the state approved HB 1406 which is a local revenue
sharing program for local governments. This allows local governments to collect a portion of
state sales tax for addressing affordable housing. The tax credit is in place for up to 20 years.
All projects funded by HB 1406 must serve those at or below 60% of the area median income
(AMI). Homelessness and affordable housing are key issues both in the region as a whole and
in the City of Tukwila itself. The revenue available to cities through this bill is a way to begin to
address this issue through acquiring, rehabilitating, or constructing affordable housing;
operations and maintenance of new affordable housing or supportive housing facilities; or for
rental assistance. House Bill 1406 can be found as Attachment A.
In September 2019 Tukwila passed Resolution No. 1966 and Ordinance No. 2316 with an
effective date of November 1, 2019 to impose the Affordable Supportive Housing State Shared
Tax authorized by HB 1406. The maximum award amount that Tukwila may receive each year
is $165, 998.21.
The revenue from HB 1406 can be used for:
1. Acquiring, rehabilitating, or constructing affordable housing; and/or
2. Operations and maintenance of new affordable housing or supportive housing facilities;
and/or
3. Providing rental assistance to tenants (only an option for cities with a population less
than 100,000 people). Tukwila's current population is 20,294.
DISCUSSION
Tukwila must make a decision regarding how to spend the revenue received from HB 1406 for
the next 20 years. There are three options for spending the revenue:
1. Pool revenue with participating South King Housing and Homelessness Partners
(SKHHP) cities.
Tukwila currently participates in South King Housing and Homelessness Partners
(SKHHP), which is a coalition formed by an interlocal agreement between Auburn,
Burien, Covington, Des Moines, Federal Way, Kent, Normandy Park, Renton, King
County, and Tukwila. The purpose of SKHHP is to increase the available options for
45
INFORMATIONAL MEMO
Page 2
South King County residents to access affordable housing and to preserve the existing
affordable housing stock.
Tukwila Signed SKHHP Resolution No. 2019-06 (Attachment B) which supports the idea
of all participating SKHHP cities pooling the revenue received from HB 1406. Auburn,
Burien, and Des Moines have both passed resolutions to pool all funding received from
HB 1406 with SKHHP, assuming all other cities will also pool their resources. If other
cities decide not to pool their revenue, they will not pool either.
If all cities pool their revenue from HB 1406, the maximum revenue would be
approximately one million dollars per year. The maximum yearly revenue per City is
capped at .0073% of the sales tax revenue from 2019 and could be less based on actual
sales tax collected each year. This tax credit is in place for 20 years, totaling
approximately 20 million dollars overall if sales tax revenue stays consistent in the
region. This money would be used toward affordable housing projects within the
participating cities.
City
Estimated Annual Revenue
Auburn
$154,992
Burien
$65,477
Covington
$43,678
Des Moines
$29,793
Federal Way
$124,142
Kent
$185,467
Normandy Park
$4,866
Renton
$236,380
Tukwila
$165,998
Total
$1,010,793
Table 1. Estimates based on 2018 data
Of the participating SKHHP members, so far Auburn, Burien, and Des Moines have
passed resolutions to pool 100% of their revenue from HB 1406. Kent has deferred this
decision to the Mayor. The language used in the SKHHP Resolution No. 2019-06
specifies urging member cities to pool their funds. At this time King County is undecided
as to how and where their revenue from this bill will be spent.
The SKHHP Executive Board will be the body that will decide on how the pooled
revenue from HB 1406 will be spent. Counties and cities that enact the provisions of HB
1406 may issue general obligation or revenue bonds, and may use money collected
under HB 1406 for the repayment of bonds.
2. Maintain all revenue to be used in Tukwila.
Tukwila could choose to keep all revenue collected from HB 1406 to be used toward:
acquiring, rehabilitating, or constructing housing; operations and maintenance of new
affordable housing; and/or providing rental assistance to low-income tenants, all within
the City of Tukwila.
Some examples of revenue spending within the City are:
M.
INFORMATIONAL MEMO
Page 3
• Rehabilitating Tukwila's existing affordable housing stock, which may include
partnering with King County Housing Authority.
• Partnering with existing affordable housing developers on projects that are
shovel -ready.
• Providing rental assistance to Tukwila's low-income tenants.
• Exploring the option to bond with the purposes of funding affordable housing
construction
3. Keep a portion of the revenue for rental assistance or rehabilitation of the existing
affordable housing stock in Tukwila and pool the remainder with SKHHP.
Tukwila could choose to split the revenue from HB 1406 between rental assistance and
pooling funds with SKHHP. Table 2 shows the maximum amount per year that Tukwila
would keep for rental assistance and the amount that would be pooled with SKHHP
when different percentages of the revenue from SHB 1406 are retained by the City.
Max. HB 1406
Percent Used
Maximum
Maximum
Number of
Revenue/Year
for Tukwila
$/Year Used
$/Year
Tukwila
Rental
for Tukwila
pooled to
households
Assistance
Rental
SKHHP
to be
Assistance
served
$165,998
10%
$16,599.80
$149,398.20
24
$165,998
15%
$24,899.70
$141,098.30
36
$165,998
20%
$33,199.60
$132,798.40
47
$165,998
25%
$41,499.50
$124,498.50
59
$165,998
30%
$49,799.40
$116,198.60
71
Fable 2. Split Revenue between Rental Assistance and SKHHP
Tukwila is in a unique position compared to other participating SKHHP cities. Only cities
with a population under 100,000 people qualify to use the revenue from this bill on rental
assistance, which Tukwila has. Tukwila also has an existing program in place that
provides direct services to residents, which many other SKHHP cities do not.
In 2019, Human Services provided rental assistance to 66 households with grants
averaging between $500-$700. However, an additional 181 residents were qualified and
counted as a 'turn -away'— meaning they qualified for assistance, but the City had no
funds available to assist. Between 2018 and 2019, the City experienced a 376% percent
increase in rental assistance need over the previous year. For context, in 2018, the City
turned away 35 qualified residents; the percent change is indicating the City is
experiencing a significant increase in need for rental assistance which it did not
meet. Approximately 70% of financial assistance calls to human services are requests
for rental assistance. Allocating a portion of the revenue collected through this bill could
allow the City to stabilize additional households and enable those households to remain
in Tukwila.
If there are funds that have not been expended for rental assistance in Tukwila at the
end of each year, these funds could then be pooled with SKHHP.
Staff has looked at the building permit data of previous renovations of existing affordable
housing owned by King County Housing Authority (KCHA) in Tukwila. The value of
improvements ranges from $1.4 million dollars to $575 000. The higher end was for
renovating a three story 30-unit apartment building in 2007 to upgrade its fire protection
47
INFORMATIONAL MEMO
Page 4
and mechanical system The lower end was for minimal exterior envelope upgrades
such as new siding trim and roof repairs to a two story apartment complex with 32 units
in 2019 The maiority of KCHA housing was built in the 1960s and 1970s. As these
properties age they become more expensive to operate and maintain. With each
Passing year, features such as utility systems building envelopes, and elevators come
closer to the end of their useful life span. To finance improvements KCHA has used low-
income housing tax credits tax-exempt bonds and federal money to extend the life of its
public housing If City Council elects to use some of the HB 1406 money for renovating
existing housing it is likely that the split amount would not be sufficient to make a
significant impact and the cost to upgrade apartments would outstrip the annual revenue
available.
FINANCIAL IMPACT
Tukwila began collecting revenue from HB 1406 on November 1, 2019 per official notice from
the Department of Revenue (Attachment C). Revenue is distributed to the City monthly from the
Department of Revenue as a percentage of Tukwila's sales tax that, prior to this bill, went to the
State.
Tukwila's maximum yearly revenue from HB 1406 is $165,998.21. Tukwila will keep .0073% of
the sales tax up to the maximum amount. Once the maximum award is reached, distribution of
the tax will stop for the remainder of the fiscal year.
RECOMMENDATION
Administration and staff recommend keeping 30% of the yearly revenue from HB 1406 to be
used toward rental assistance while pooling the rest of the funds with participating SKHHP
cities. If there are funds that have not been expended for rental assistance by the end of each
year, staff recommends pooling this revenue with SKHHP. This will allow the City to assist with
affordable housing projects in the region as well as assist Tukwila residents in need.
ATTACHMENTS
A. House Bill 1406
B. SKHHP Resolution No. 2019-06
C. Notice from Department of Revenue
D. Resolution
1
2
91
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
H-1301.2
SUBSTITUTE HOUSE BILL 1406
State of Washington 66th Legislature 2019 Regular Session
By House Housing, Community Development & Veterans (originally
sponsored by Representatives Robinson, Macri, Chapman, Valdez, Senn,
Peterson, Kloba, Tharinger, Gregerson, Stanford, Walen, Doglio,
Frame, Jinkins, Riccelli, Slatter, Ormsby, and Santos)
READ FIRST TIME 02/08/19.
AN ACT Relating to encouraging investments in affordable and
supportive housing; and adding a new section to chapter 82.14 RCW.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1. A new section is added to chapter 82.14
RCW to read as follows:
(1) The definitions in this subsection apply throughout this
section unless the context clearly requires otherwise.
(a) "Nonparticipating city" is a city that does not impose a
sales and use tax in accordance with the terms of this section.
(b) "Nonparticipating county" is a county that does not impose a
sales and use tax in accordance with the terms of this section.
(c) "Participating city" is a city that imposes a sales and use
tax in accordance with the terms of this section.
(d) "Participating county" is a county that imposes a sales and
use tax in accordance with the terms of this section.
(e) "Qualifying local tax" means the following tax sources, if
the tax source is instated no later than twelve months after the
effective date of this section:
(i) The affordable housing levy authorized under RCW 84.52.105;
(ii) The sales and use tax for housing and related services
authorized under RCW 82.14.530; and
P. 1 SHB 1406
i •
1 (iii) The sales tax for chemical dependency and mental health
2 treatment services or therapeutic courts authorized under RCW
3 82.14.460.
4 (2)(a) A county or city legislative authority may authorize, fix,
5 and impose a sales and use tax in accordance with the terms of this
6 section.
7 (b) The tax under this section is assessed on the selling price
8 in the case of a sales tax, or value of the article used, in the case
9 of a use tax.
10 (c) The rate of the tax under this section for an individual
11 participating city and an individual participating county may not
12 exceed:
13 (i) Beginning on the effective date of this section until twelve
14 months after the effective date of this section:
15 (A) One one -hundredth percent for a:
16 (I) Participating city, unless the participating city levies a
17 qualifying local tax; and
18 (II) Participating county, within the limits of nonparticipating
19 cities within the county;
20 (B) Two one -hundredths percent for a:
21 (I) Participating city that currently levies a qualifying local
22 tax;
23 (II) Participating city if the county in which it is located
24 declares they will not levy the sales and use tax authorized under
25 this section; and
26 (III) Participating county within the unincorporated areas of the
27 county and any city that declares they will not levy the sales and
28 use tax authorized under this section;
29 (ii) Beginning twelve months after the effective date of this
30 section:
31 (A) One one -hundredth percent for a:
32 (I) Participating city that is located within a participating
33 county if the participating city is not levying a qualifying local
34 tax; and
35 (II) Participating county, within the limits of a participating
36 city if the participating city is not levying a qualifying local tax;
37 (B) Two one -hundredths percent within the limits of a:
38 (I) Participating city that is levying a qualifying local tax;
39 and
p. 2
50
SHB 1406
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
(II) Participating county within the unincorporated area of the
county and within the limits of any nonparticipating city that is
located within the county.
(d) A county may not levy the tax authorized under this section
within the limits of a participating city that levies a qualifying
local tax.
(e)(i) In order for a county or city legislative authority to
impose the tax under this section, the authority must adopt:
(A) A resolution of intent to adopt legislation to authorize the
maximum capacity of the tax in this section within six months of the
date in which this section takes effect; and
(B) Legislation to authorize the maximum capacity of the tax in
this section within one year of the date on which this section takes
effect.
(ii) Adoption of the resolution of intent and legislation
requires simple majority approval of the enacting legislative
authority.
(iii) If a county or city has not adopted a resolution of .intent
in accordance with the terms of this section, the county or city may
not authorize, fix, and impose the tax.
(3) The tax imposed under this section must be deducted from the
amount of tax otherwise required to be collected or paid to the
department of revenue under chapter 82.08 or 82.12 RCW. The
department must perform the collection of such taxes on behalf of the
county or city at no cost to the county or city.
(4) By December 31, 2019, or within thirty days of a county or
city authorizing the tax under this section, whichever is later, the
department must calculate the maximum amount of tax distributions for
each county and city authorizing the tax under this section as
follows:
(a) The maximum amount for a participating county equals the
taxable retail sales within the county in state fiscal year 2019
multiplied by the tax rate imposed under this section. If a county
imposes a tax authorized under this section after a city located in
that county has imposed the tax, the taxable retail sales within the
city in state fiscal year 2019 must be subtracted from the taxable
retail sales within the county for the calculation of the maximum
amount; and
p. 3 SHB 1406
51
1 (b) The maximum amount for a city equals the taxable retail sales
2 within the city in state fiscal year 2019 multiplied by the tax rate
3 imposed under subsection (1) of this section.
4 (5) The tax must cease to be distributed to a county or city for
5 the remainder of any fiscal year in which the amount of tax exceeds
6 the maximum amount in subsection (4) of this section. The department
7 must remit any annual tax revenues above the maximum to the state
8 treasurer for deposit in the general fund. Distributions to a county
9 or city meeting the maximum amount must resume at the beginning of
10 the next fiscal year.
11 (6)(a) If a county has a population greater than four hundred
12 thousand or a city has a population greater than one hundred
13 thousand, the moneys collected or bonds issued under this section may
14 only be used for the following purposes:
15 (i) Acquiring, rehabilitating, or constructing affordable
16 housing, which may include new units of affordable housing within an
17 existing structure or facilities providing supportive housing
18 services under RCW 71.24.385; or
19 (ii) Funding the operations and maintenance costs of new units of
20 affordable or supportive housing.
21 (b) If a county has a population of four hundred thousand or less
22 or a city has a population of one hundred thousand or less, the
23 moneys collected under this section may only be used for the purposes
24 provided in (a) of this subsection or for providing rental assistance
25 to tenants.
26 (7) The housing and services provided pursuant to subsection (6)
27 of this section may only be provided to persons whose income is at or
28 below sixty percent of the median income of the county or city
29 imposing the tax. If the median income of a city enacting the tax
30 under this section is not available from the United States census
31 bureau, the housing and services provided pursuant to subsection (6)
32 of this section may only be provided to persons whose income is at or
33 below sixty percent of the median income of the county in which the
34 city is located.
35 (8) In determining the use of funds under subsection (6) of this
36 section, a county or city must consider the income of the individuals
37 and families to be served, the leveraging of the resources made
38 available under this section, and the housing needs within the
39 jurisdiction of the taxing authority.
p. 4 SHB 1406
52
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
(9) To carry out the purposes of this section including, but not
limited to, financing loans or grants to nonprofit organizations or
public housing authorities, the legislative authority of the county
or city imposing the tax has the authority to issue general
obligation or revenue bonds within the limitations now or hereafter
prescribed by the laws of this state, and may use, and is authorized
to pledge, the moneys collected under this section for repayment of
such bonds.
(10) A county or city may enter into an interlocal agreement with
one or more counties, cities, or public housing authorities in
accordance with chapter 39.34 RCW. The agreement may include, but is
not limited to, pooling the tax receipts received under this section,
pledging those taxes to bonds issued by one or more parties to the
agreement, and allocating the proceeds of the taxes levied or the
bonds issued in accordance with such interlocal agreement and this
section.
(11) Counties and cities imposing the tax under this section must
report annually to the department of commerce on the collection and
use of the revenue. The department of commerce must adopt rules
prescribing content of such reports. By December 1, 2019, and
annually thereafter, and in compliance with RCW 43.01.036, the
department of commerce must submit a report annually to the
appropriate legislative committees with regard to such uses.
(12) The tax imposed by a county or city under this section
expires twenty years after the date on which the tax is first
imposed.
P. 5 SHB 1406
53
54
RESOLUTION NO. 2019-06
A RESOLUTION OF THE EXECUTIVE BOARD OF THE
SOUTH KING COUNTY HOUSING AND HOMELESSNESS
PARTNERS URGING SKHHP MEMBER CITIES TO
SUPPORT POOLING OF HB 1406 FUNDS.
WHEREAS, in 2019 the cities of Auburn, Burien, Covington, Des Moines, Federal
Way, Kent, Normandy Park, Renton, and Tukwila and King County entered into an
Interlocal Agreement (ILA) that formed the South King Housing and Homelessness
Partners (SKHHP); and
WHEREAS, pursuant to the ILA, the member cities have a common goal to ensure
availability of housing that meets the needs of all income levels in South King County;
and
WHEREAS, also pursuant to the ILA, the member cities wish to act cooperatively
to formulate housing policies and strategies that address housing stability, to foster efforts
to preserve and provide affordable housing by combining public funding with private -
sector resources, to support implementation of the Washington State GMA, related
countywide planning policies, and other local policies and program relating to affordable
housing, and to do so efficiently and expeditiously; and
WHEREAS, also pursuant to the ILA, the member cities have determined that the
most efficient and expeditious way for the parties to address affordable housing needs in
South King County is through cooperative action and pooling of public and private
resources; and
Resolution No, 2019-06
November 22, 2019
Page 1 of 4
Rev. 2019
55
WHEREAS, the ILA states that the parties intend that the ILA serves as a
framework for all participating municipalities within the broader SKHHP Sphere of
Influence to do the aforementioned work; and
WHEREAS, on July 26, 2019 the SKHHP Executive Board adopted Resolution
2019-05 which urges member cities to declare their intent to enact the provisions of HB
1406; and
WHEREAS, Resolution 2019-05 states that the Executive Board commits to
developing options and a recommendation, including for the proposed pooling of funding,
that details funding commitments for each member city's legislative authority to consider
for future subsequent action; and
WHEREAS, HB 1406 is a powerful and meaningful funding source to further
advance the efforts of the housing objectives established through the ILA that, if pooled,
will generate approximately $1,000,000 per year for the eligible 20 year period (See
Attachment A); and
WHEREAS, the Executive Board adopts the recommendations contained within
this resolution as a unified statement of support by SKHHP member cities.
NOW, THEREFORE, THE EXECUTIVE BOARD RESOLVES as follows:
Section 1. The Executive Board of SKHHP urges all member cities to pool the
base sales tax credit revenues collected under HB 1406 and to allocate the full amount
of those revenues to SKHHP.
Section 2. In order to maximize HB 1406 funding within King County, the
Executive Board of SKHHP urges all member cities to take Ordinance action on HB 1406
after King County takes action.
Resolution No. 2019-06
November 22, 2019
Page 2 of 4
Rev. 2019
56
Section 3. The Executive Board of SKHHP urges King County to award HB
1406 funds to housing development based in the Urban Growth Areas (UGA) of SKHHP
member cities in a manner that proportionately represents the cumulative population of
the UGA's of SKHHP member cities.
Section 4. The Executive Board of SKHHP commits to aligning the use of HB
1406 funds with the work plan required within the adopted ILA and the recommendation
and priorities of the Regional Affordable Housing Task Force Five Year Action Plan.
Section 5 Individual municipalities have unique housing needs and priorities
and not every proiect proposal will align with a city's goals policies or laws. The intent
and effect of this resolution is not to usurp a city's individual authority. Therefore, if funds
are pooled for the purpose of aiding in the creation or preservation of housing the process
for proiect consideration must allow the city in which the project is proposed to first
approve or reject the proposal prior to the Executive Board's commitment of funds to the
proiect.
Section 5. This Resolution will take effect and be in full force on passage and
signature.
Dated and Signed this age- day of I OVeM6e(— 2019.
SOUTH KING COUNTY HOUSING AND HOMELESSNESS PARTNERS
NQUA, - - -
WAr4CY 44
Resolution No. 2019-06
November 22, 2019
Page 3 of 4
Shawn Campbell, Auburn City Clerk
Rev. 2019
57
SKHHP Resolution 2019-06 Attachment A
Estimated HB 1406 Revenue by SKHHP Municipality (based on 2018 revenues)
r Zy 4 N`AYx„"ro}, i
Cat�"rsrd
?iy
i rsEsti_matedAnnual Revenue . .::
Auburn
$154,992
Burien
$65,477
Covington
$43,678
Des Moines
$29,793
Federal Way
$124,142
Kent
$185,467
Normand Park
$4,866
Renton
$236,380
Tukwila
$162,046
Total not including King Count
$1,006,841.00
Resolution No. 2019-06
November 22, 2019
Page 4 of 4
Rev. 2019
PRI
� STA'f
<<k�.. x 11 E" o�,
188g t
-STATE OP: WAS I-IINGTON
DEPARTMENT OF REVENUE
November 20, 2019
Meredith Sampson, Assistant Planner
City of Tukwila
6300 Southeenter Blvd Ste 100
Tukwila, WA 98188
Re: City of Tukwila Ordinance No. 2613
Affordable and Supportive Housing State Shared Tax
Dear Ms. Sampson:
The Department of Revenue has received your Resolution No. 1966 and Ordinance No. 2316 on
September 30, 2019 with the effective date of November 1, 2019 to impose the Affordable and
Supportive Housing State Shared Tax authorized by Substitute House Bill (SHB) 1406 and
Revised Code of Washington (RCW) 82.14.540.
As required by RCW 82.14.540, the Department has calculated the maximum capacity (cap) of
$165,998.21. Once the maximum award amount has been reached, the tax shall cease to be
distributed for the remainder of the fiscal year.
If you have any questions, you may contact me at (360) 705-6039.
Sincerely,
Jessica Hicks
Tax Administration Manager
Taxpayer Account Administration
Taxpayer Account Administration Division
P O Box 47476 ♦ Olympia, Washington 98504-7476
59
DRAFT
NOTE: The shaded text on this page denotes the correct title
for the referenced House Bill. This is a change from the
resolution that was in the Planning and Economic Development
Committee agenda packet for March 2, 2020.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, AUTHORIZING THE MAYOR TO
KEEP 30% OF THE FUNDS, UP TO A MAXIMUM OF $49,800
ANNUALLY, COLLECTED UNDER THE PROVISIONS OF
WASHINGTON STATE HOUSE BILL 1406 AND CITY OF
TUKWILA ORDINANCE NO. 2613 FOR RENTAL ASSISTANCE
TO LOW-INCOME TENANTS, AND FOR TRANSFER OF THE
REMAINING FUNDS COLLECTED TO THE SOUTH KING
HOUSING AND HOMELESSNESS PARTNERS..
WHEREAS, the 2019 Washington State Legislature enacted gohiat� 8,6bs&uA
House Bill (SHB) 1406 on July 28, 2019, which authorizes cities and counties to recapture
a portion of the Washington State sales tax for use to support affordable housing
initiatives; and
WHEREAS, on September 16, 2019, the Tukwila City Council adopted and enacted
Resolution No. 1966 and Ordinance No. 2613, which authorize a recapture of Washington
State sales tax, under SHB 1406, that is estimated to generate approximately $165,000
per year for the next 20 years; and
WHEREAS, the Tukwila City Council authorized the Mayor to enter into an Interlocal
Agreement with 8 other south King County cities and King County to form the South King
Housing and Homelessness Partners; and
WHEREAS, the City of Tukwila executed the South King Housing and Homelessness
Partners (SKHHP) Interlocal Agreement on February 21, 2019; and
WHEREAS, the Interlocal Agreement states that "the Parties have determined that
the most efficient and expeditious way for the Parties to address affordable housing needs
in South King County is through cooperative action and pooling public and private
resources"; and
WHEREAS, all members of SKHHP have taken action to enact the sales tax
recapture provisions established in SHB 1406; and
WHEREAS, on November 22, 2019, the SKHHP Executive Board adopted SKHHP
Resolution 2019-06, which urges its members to pool funds collected under the provisions
of SHB 1406; and
WHEREAS, the City of Tukwila is qualified under SHB 1406 to use funds collected
toward rental assistance to low-income tenants; and
W:\Word Processing\Resolutions\HB 1406 use of funds 3-10-20
MS:bjs Page 1 of 2
61
WHEREAS, the City of Tukwila's Human Services Department has a program
already in place that provides direct services to households in need and has to turn away
qualified residents each year due to a lack of funds; and
WHEREAS, the City of Tukwila will keep 30% of the recaptured Washington State
sales tax funds collected under SHB 1406, up to a maximum of $49,800 annually, to be
used for rental assistance to residents and will pool the remainder of the funds with
SKHHP; and
WHEREAS, SHB 1406 funds may be used for the purpose of acquiring, rehabilitating
or constructing affordable housing; funding the operations and maintenance costs of new
units of affordable or supportive housing; and for rental assistance; and
WHEREAS, SHB 1406 requires counties and cities that enact its provisions to also
provide annual reports to the Department of Commerce;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
Section 1. Resolution of Intent. The City Council declares its intent to authorize the
City of Tukwila to keep 30% of the recaptured Washington State sales tax funds collected
under SHB 1406, up to a maximum of $49,800 annually, and to transfer the remaining
funds collected to the South King Housing and Homelessness Partners (SKHHP).
Section 2. Further Authority; Ratification. All City officials, their agents, and
representatives are hereby authorized and directed to undertake all action necessary or
desirable from time to time to carry out the terms of, and complete the actions
contemplated by, this resolution. All acts taken pursuant to the authority of this resolution
but prior to its effective date are hereby ratified.
Section 3. This authorization is contingent upon each of the other SKHHP cities
taking similar action to direct a proportionate amount of SHB 1406 funds to SKHHP.
Section 4. Effective Date. This resolution shall take effect immediately upon its
passage and adoption.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2020.
ATTEST/AUTH ENTICATED:
Christy O'Flaherty, MMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
De'Sean Quinn, Council President
Filed with the City Clerk:_
Passed by the City Council:
Resolution Number:
62
W:\Word Processing\Resolutions\NB 1406 use of funds 3-10-20
MS:bjs
Page 2 of 2
City of TAM
City Council Planning & Economic Development Committee
Meeting Minutes
March 2, 2020 - 5:30 p.m. - Hazelnut Conference Room, City Hall
Councilmembers Present: Thomas McLeod, Kathy Hougardy, Zak Idan
Staff Present: Lynn Miranda, Meredith Sampson, Robert Eaton, Kris Kelly, Nancy Eklund,
Jay Wittwer, Rick Still, Rachel Bianchi, Stacy Hanson, Brandon Miles,
Minnie Dhaliwal
Others Present: Sharon Mann, Brian Deller, Gurkaran Grewal
Chair McLeod called the meeting to order at 5:30 p.m.
I. BUSINESS AGENDA
A. Lodging Tax Six -Year Financial Model
Staff provided an overview of the Lodging Tax Six -Year Financial Model and ending fund
balance goal of $400K in any given year.
Committee Recommendation
Discussion only.
B. Lodging Tax Application: Virtual Sports
Staff is seeking Council decision on a funding request from Virtual Sports for $30,000 in
lodging tax for a Tukwila E-Sports Initiative.
Committee Recommendation
Unanimous approval. Forward to March 2, 2020 Regular Consent Agenda.
C. Resolution: Sales Tax Revenue for Affordable Housing
Staff is seeking Council approval of a resolution that would retain 30% of the yearly revenue
from House Bill 1406 for rental assistance and pool the rest of the funds with South King
Housing & Homelessness Partnership member agencies. Funds not used for rental
assistance by the end of the year may be pooled.
Committee question(s) requiring follow up
• Amend resolution to refer to "Substitute House Bill 1406" instead of "Senate House Bill
1406."
• Return to committee with high level discussion of rehabilitating existing buildings.
Committee Recommendation
Return to Committee March 23, 2020 and forward to March 23, 2020 Committee of the Whole.
63
Councilmembers Present: Thomas McLeod, Kathy Hougardy, De'Sean Quinn
StoffPresent: Rachel Bianchi, Telephonic: Minnie Dhaliwal, Cyndy Knighton, Lynn Miranda
Chair McLeod called the meeting to order at 5:31 p.m.
I. BUSINESSAGENDA
A. Tukwila International Boulevard Rechannelization Alternatives
Staff updated the committee on the implementation of the Tukwila International Boulevard
Neighborhood Plan and the rechannelization alternatives report.
Committee question(s) requiring follow up
Councilmember Hougardy will send additional questions. Staff indicated they would return
with additional information on the cost associated with public outreach. Fehr & Peers will
present at the next meeting and discuss lessons learned from the road diets in Seattle on
Martin Luther King Jr. Boulevard and Rainier Avenue South.
Committee Recommendation
Return to Committee 4/20/20.
B. Resolution: House Bill 1406 Investments
Staff is seeking Council approval of a resolution that would retain 30% of the yearly revenue
from House Bill 1406 for rental assistance and pool the rest of the funds with South King
Housing & Homelessness Partnership member agencies. As requested, staff presented
or information about the cost of rehabilitating existing multifamily housing.
Committee Recommendation
Unanimous approval. Forward to the March 23, 2020 Committee of the Whole. However, some
cities are contemplating using some of the 1406 dollars for rental assistance in light of the
coronavirus. Keeping this timeline allows the City to potentially access 1406 funds for rental
assistance in April but pivot if other SKHH P agencies decide to dedicate a larger percentage to
rental assistance than what is currently recommended.
C. Tukwila Visitor WayfindingSi nna eg Plan
This item was postponed.
MISCELLANEOUS
The meeting adjourned of 6:20 p.m.
Committee Chair Approval
Minutes by RB