The San Juan County Council had a productive day in relation to affordable housing on Oct. 28. During its regularly scheduled meeting, the board adopted a Homeless Housing Plan, discussed an ordinance for implementing an affordable housing sales tax allocation and approved 2019 Home Fund awards.
Homeless Housing Plan
San Juan County government has a goal to eliminate homelessness in the islands.
“We are aware that this is an ambitious goal, but given the scope of homelessness in San Juan County we believe it is a reasonably achievable goal,” San Juan County Affordable Housing Coordinator Ryan Page said during a July 22 council meeting.
The midsummer meeting was the second meeting with the council regarding the document that has been in the works for just over a year, according to Page. The Homeless Plan is a five-year initiative to end homelessness in the county by 2024. Page added that it is likely going to cost the county $500,000 over five years to achieve this goal. It would also require half of Page’s staff time over that same time period.
“I think it’s important for citizens of San Juan County to understand that right now we’re estimating we’re going to spend half a million dollars on trying to address the homeless problems in the county,” Councilmember Bill Watson said during the July meeting. “I think that’s a significant effort and I wanted to make sure it is recognized from the citizens.”
County Council chair member Jamie Stephens asked Page whether the county was expected to devote the half-million dollars when adopting the Homeless Plan.
Page answered that he wasn’t asking the council to approve $500,000 and explained that the Department of Commerce — the entity requiring the plan — does not require counties to identify the funding sources in the plan.
“This plan is not going to be the Ten Commandments, it’s not going to be set in stone. Once we adopt it, it’s going to guide us, but we will have the flexibility to be able to address problems as they come up.”
During the 2019 “Point in Time Homeless Count,” 149 people were identified as not having a stable place to live, according to a February press release from San Juan County. Of those 149, 67 were living in vehicles, abandoned buildings, on an RV or boat, lacking either drinking water, a restroom, heat, the ability to cook food or the ability to bathe. The remaining 82 were at-risk of homelessness, living in temporary unstable arrangements, often with friends or family.
According to Page, the plan, which was unanimously adopted by the council at the Oct. 28 meeting, has the projected ability to assist approximately 33 homeless and 108 at risk people annually. Page’s team went through goals and strategies to devise this projection.
“We were really happy with how that projection turned out,” Page said. “We have a realistic expectation for the goals that we set out for ourselves.”
Page reiterated the plan requires no financial obligation from the county council as it is more of a guiding document.
“Thank you for all your work on this and the committee that put it together,” Stephens said as the council approved the plan.
Sales tax allocation
Substitute House Bill 1406, known as the Affordable Housing Sales Tax Credit, was adopted during the 2019 legislative session, to encourage local governmental investments in affordable housing solutions. The bill is a sales tax option as a credit against the sales tax rate of 6.5 percent.
“This is not going to result in a sales tax increase to consumers in the county, it’s only going to result in funds retained by the county,” Page said. “It’s essentially an ordinance that allows us to do what the resolution already says. It allows us to collect these funds and put them to those good uses.”
According to the Municipal Research and Services Center, in counties with fewer than 400,000 residents, the funds collected may be used for acquiring, rehabilitating or constructing affordable housing or supportive housing for behavioral health; operating and maintenance costs of new units of affordable and supportive housing; and provide rental assistance to residents at or below 60 percent of the median income. The county may also finance loans or grants to nonprofits to facilitate affordable and supportive housing projects.
The county would receive 0.0146 percent of the state sales tax for this program. MRSC estimates the sales tax would accrue $63,306 annually, based on retail sales data from the last three quarters of 2018 and the first quarter of 2019.
If the council passes the ordinance in November, it would begin collecting in January 2020. To participate in the program, by law, the county must pass a resolution of intent by Jan. 27, 2020, and adopt legislation to authorize by July 27, 2020.
2019 Home Fund Awards
The first-ever San Juan County Home Fund grants were awarded during the Oct. 28 council meeting. A project from Lopez, Orcas and San Juan all received some funding from the county’s real estate excise tax for affordable housing.
“Our goal for the Home Fund, for the first year, was to have a project on each island and now it’s looking more like it’s going to be two projects on each island,” Page said of future requests versus the number of funds available annually. “April’s Grove counts as two.”
OPAL Community Land Trust requested $1.75 million to help complete April’s Grove, a 45-unit apartment complex set to open in summer 2020. Council awarded $850,000 to the April’s Grove project. The remaining $450,000 will likely be granted during next year’s award.
Salish Way III is the ninth housing project developed by the Lopez Community Land Trust on Lopez Island. The proposed project is for four new 650-square-foot single-family houses comprised of one bedroom with a loft. LCLT requested $200,000 and was granted its entire request.
San Juan Community Home Trust requested $80,612.10 to install new metal roofs for six of its Salal community houses. The council granted the entire request.
“It was very difficult to compare apples to apples a maintenance project to a rental project or homeownership project just by design of how those applications set up,” Page said of determining which projects to give priority to during a July 22 presentation to the council.
A fourth project, $120,000 that was requested for a single-family home at 588 McDonald St. in Friday Harbor was not funded. The application did not define how exactly the home trust intended to use the funds and since it was for one dwelling, staff did not recommend granting money to the project.
The home fund was approved by voters in the November 2018 general election allowing the county to collect 0.5 percent of the selling price of local real estate with the buyer paying 99 percent and the seller paying 1 percent. The one-time tax is in effect for 12 years, and its purpose is to provide funding for the development and preservation of housing for very-low-, low- and moderate-income residents and those with special needs.
On June 3, San Juan County Health and Community Services released a request for affordable housing project applications. The application deadline was July 15, and $600,000 was made available. The department received four applications to build 50 units and to perform maintenance on six existing units. The total requested was $2,150,621. The total to-date amount of collected funds is $1.45 million, therefore the council decided to grant more than just the $600,000 that was advertised.
“I just wanted to say to staff — Ryan and Mark — and to the council, on behalf of residents of Orcas Island, I really appreciate the support, the overwhelming support this year from the county to OPAL for April’s Grove. It will make a huge impact,” Councilmember Rick Hughes said. “I think it’s one of the first big drops of affordable housing — rental housing — on the island in a long time. So thank you very much for the support for this really important project for the community.”