Capital Budgets Emerge in Olympia: Good News or More of the Same?

Anyone who’s worked on issues in the Washington State Legislature will tell you there are sort of two phases, policy and budget. Early in a 60 or 90 session there are lots of debates before the deadlines in each house about bills that change rules and regulations or add new ones. The second phase is about money and how the state is going to raise and spend it over the following two years. Based on the rules, the state budget has to be balanced and completed by the end of session. Unlike the federal government, there is no way to just keep funding the status quo through resolution. And the state budget has two parts as well, the operating budget which allocates money for the work of government and taxes to pay for it, and the capital budget which is bricks and mortar and borrowing (bonds) — sometimes — to pay for them. We now have a early sense of the capital budgets from both houses.

Here’s what the State Senate says it is going to do for housing with both parties agreeing (what the Senate has called a bipartisan budget).

Affordable Housing Loans and Grants ($175 million)

$175 million is provided for affordable housing projects, including $157 million for grants and loans through the Housing Trust Fund and $18 million for grants to 12 specific housing projects.

Allocations within the Housing Trust Fund include:

  • $20 million for competitive awards for high quality affordable housing that will move people from homelessness into secure housing and that are less than $125,000 per unit
  • $35 million for supportive housing and case management services to persons with behavioral health or chronic mental illness
  • $10 million for housing that services people with developmental disabilities
  • $10 million for housing that serves people who are employed as farmworkers
  • $12.5 million is provided as a state match on private contributions that fund the production and preservation of affordable housing

I’m still digging into the details but this is a promising budget, putting an emphasis on a low dollar amount per unit, $125,000, on a part of the Housing Trust Fund for homelessness. On the other hand, in many ways, the allocation should be greater since this is a population that has greater needs. Putting a dollar figure on units is a good step. Now if they’d do the same on the $157,000 being allocated we’d be more impressed. And when coupled with more dollars to address a real and serious cause of homelessness, mental health (eviction is not), the first two bullets round out $55,000,000 in a promising way. And we’ve been pushing for more housing in rural Washington for years now, especially for farmworker housing. What’s the $12,500,000 for preservation. We don’t know exactly. We’re looking into it. This budget was just released yesterday.

Here’s the House Capital Budget on housing, an explicitly partisan budget, at least the way it was released earlier in the week.

Affordable Housing through the Housing Trust Fund ($150 million)

$150 million is provided for affordable housing projects under the Housing Trust Fund:

  • $30 million is for housing projects that provide supportive housing and case-management services for persons with chronic mental illness;
  • $10 million is for competitively awarded housing preservation grants;
  • $41 million is provided for 11 specific housing projects; and
  • the remaining $69 million are for competitive housing projects:
    • 10 percent for projects that benefit veterans;
    • 10 percent for projects that benefit homeownership;
    • 5 percent for projects that benefit persons with developmental disabilities;
    • and the remaining amounts for projects that benefit low-income populations in need of housing.

It’s less money than the Senate and a lot more money set aside for a very long list of specific projects. There is nothing for farmworker housing or any acknowledgement of homelessness, mental health, or any costs limits imposed. The House budget is more of the same: lots of cash for projects that want money, and only a nod to more specific needs. Supportive housing is included, something that as I said, needs a significant investment while so-called work force housing could easily be provided by for-profits if local governments would just allow that to happen.

All in all, nothing too shocking or surprising here. I am looking into a $500,000 allocation for The Morck Hotel, a possible housing project in long underfunded Grays Harbor County. Is it for housing? That’s not what I’ve heard. I’ve heard the huge non-profit Forterra wants to build a luxury hotel there. Does that make sense? It doesn’t. Grays Harbor needs housing not a fancy hotel. That line item will be an area we’ll be watching closely. And we’ll update this later as more details emerge. Budget documents are complex and not always what they seem on their face, and much will move around in the weeks ahead. We did not see big reforms made in how the state funds housing, but maybe we’ll see some incremental improvement.

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