Chapter 3.08
AFFORDABLE HOUSING SALES OR USE TAX
Sections:
3.08.020 Tax retention authorized and use – Effective date and termination.
3.08.030 Administration of proceeds.
3.08.010 Findings.
(1) The city is only able to retain under the statute 0.0073 percent of the sales and use taxes remitted to the state for addressing affordable housing and homeless issues. The city has been told that it could expect as little as $3,600 in the first year of retention and as high as $7,500 in the twentieth year of retention.
(2) The discussions to date have focused on the city retaining these funds and after the first full year of collection, the city may seek proposals from local providers to award all of the collected funds in any given year to the most cost and socially effective effort that would address the needs for which the funds were made available. (Ord. 647 § 1, 2020)
3.08.020 Tax retention authorized and use – Effective date and termination.
(1) The city imposes a state-shared affordable housing sales and use tax at the rate of 0.0073 percent, or as otherwise permitted by law, of the selling price when sales tax is applied and collected, or on the value of the article used when such taxes are also collected. The state-shared affordable housing sales and use tax shall be collected and retained by the Department of Revenue and provided to the city at the earliest practicable date consistent with state law and the Department’s rules and regulations. The imposition of this is not a new tax, but rather the adoption of the authority to retain a portion of the tax that otherwise would be remitted to the state.
(2) Use of the state-shared receipts shall only be for those purposes found within RCW 82.14.540. This includes:
(a) Acquiring, rehabilitating, or constructing affordable housing, which may include new units within an existing structure or facilities providing supportive housing services under RCW 71.24.385 (behavioral health organizations);
(b) Operations and maintenance costs of new units of affordable or supportive housing; and
(c) The provision of rental assistance to tenants that are at or below 60 percent of the city’s median income.
(3) The state-shared affordable housing sales and use tax imposed within this chapter shall expire 20 years after its effective date, unless extended by state and city affirmative action. (Ord. 647 § 2, 2020)
3.08.030 Administration of proceeds.
(1) All proceeds from the tax retained from the state share of sales and use taxes from this chapter shall be retained in a separate revenue account.
(2) In each subsequent year for which funds were obtained, the city may through its regular budgeting process seek from local providers proposals for the use of the previous year’s collected funds for the purposes noted above. In the course of the council’s annual budgeting process, a single award of the funds may be made to the proposal that would result in the most cost and socially effective effort to address the purposes for which the funds were authorized and collected.
(3) The city clerk/treasurer shall be authorized to file any required copies of the ordinance codified in this chapter, applications, requests, or other such items with the State Department of Revenue to ensure the retention of this tax by the city for these purposes. Further, the mayor and their staff are authorized and directed to enter into contracts and provide notices required of state and county agencies needed to collect, retain and utilize these funds.
(4) Following the approval by the council of an award of funds as part of the annual budgeting process, the mayor and their staff shall have the authority to execute any award letters and contracts needed to distribute the funds allocated by the council. (Ord. 647 § 3, 2020)