John Mierke, a housing authority board member and resident of Baker Heights seen here Sept. 28, 2018, was one of the roughly 100 households waiting to be relocated from now-shuttered complex in Everett. The City Council is considering a fund to collect more state sales tax for affordable and supportive housing. (Lizz Giordano / Herald file)

John Mierke, a housing authority board member and resident of Baker Heights seen here Sept. 28, 2018, was one of the roughly 100 households waiting to be relocated from now-shuttered complex in Everett. The City Council is considering a fund to collect more state sales tax for affordable and supportive housing. (Lizz Giordano / Herald file)

Everett eyes keeping sales tax for affordable housing fund

A 2019 state law allows cities to retain a portion of sales tax from the state for housing.

EVERETT — For years, the city has championed and financially backed housing some of its most vulnerable people.

State legislation from last year could help Everett expand that work for decades to come.

The city hopes to leverage upwards of $4 million over the next two decades into more affordable and supportive housing, thanks to a legislative bill that lets it keep more sales and use tax revenue.

The Everett City Council is considering a fund to collect that money, estimated between $200,000 and $250,000 a year. That money would come out of the state’s portion of the sales tax and is not an increase or a new tax on consumers.

Exactly how the city would use the funds isn’t known. It could construct a new building, renovate an existing one, pay for operations and maintenance of new units, or provide rental assistance to tenants. However the money is used, it has to be for people whose income is at or below 60% of the county median income. The median household income was more than $87,000 last year.

“We need affordable and supportive housing and it’s a new revenue stream,” said Julie Willie Frauenholtz, Everett’s community development director. “We would have to save it for multiple years if we wanted to put it toward some kind of capital expense.”

Rep. June Robinson, D-Everett, sponsored the bill that the Legislature approved in 2019. When it passed, her office wrote that more than 140,000 people experience homelessness or have unstable housing in the state, and that a lack of affordable housing contributes to those problems.

“We were looking for a way to increase our state’s capacity to build more affordable housing. This is a way to do it,” Robinson said Thursday. “It’s important to provide safe, affordable housing for people. It’s the moral thing to do.”

Prior to joining the Legislature, Robinson was the executive director of the Housing Consortium of Everett and Snohomish County, a group of governments, housing developers and nonprofits that works on affordable housing issues in the area. She said soaring housing prices push rent and home purchases out of reach for too many people, including some in her hometown, which she was glad to see pursue the bill she backed.

Since the bill was enacted, all but five counties in Washington adopted resolutions to use the sales tax for housing. In Snohomish County, only four cities have pursued it, according to data from the Washington Low Income Housing Alliance. Everett would be the fifth.

“It’s really exciting,” said Michele Thomas, advocacy and policy director of the Washington Low Income Housing Alliance. “A lot of local jurisdictions across the state, counties or cities have money for affordable housing in their hands for the first time.”

Recently, supportive housing took the forefront of government-funded developments in Everett. That type of housing doesn’t limit how long someone can live there and provides services for people who were experiencing homelessness and people with disabilities.

But that’s not the only population needing a place to live.

Everett, like most of Snohomish County, has a gap between what people make and stable housing expenses. The median income in the city was $63,000, according to U.S. Census Bureau data. That’s less than the threshold for being considered “cost burdened,” when housing and utility expenses exceed a third of someone’s income.

According to the Snohomish County Housing Affordability Task Force’s report issued in February, a two-bedroom apartment costs $1,889 per month on average. Nearly half of the people in the county would spend more than a third of their income on housing and utilities at that rate.

“When we talk about affordable housing, we’re not just talking about housing for homeless people,” Willie Frauenholtz said.

The Housing Consortium of Everett and Snohomish County made an inventory of affordable housing based on four ranges of income that top out at 80% of the area median income. Everett had 4,423 income-restricted homes, which covers everything from houses to studio apartments.

“Washington state has a severe shortage of housing for low-income and extremely low-income households,” Thomas said.

To address housing affordability as it exists today in the county would take more than 6,300 new units each year and wouldn’t be accomplished until 2040, according to the task force report.

“We have a beautiful report, but it’s only a report unless we act on it,” Willie Frauenholtz said. “That takes bold choices. That takes continuous movement forward.”

The city council is scheduled to vote on creating the fund March 18.

Ben Watanabe: bwatanabe@heraldnet.com; 425-339-3037; Twitter @benwatanabe.

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