Governor Signs Affordable Housing Legislation

Brian Coddington, 509.625.6740

Sunday, April 5, 2020 at 1:39 p.m.

Another centerpiece of the Spokane City Council’s state legislative agenda was signed into law this week by Governor Jay Inslee.

HB 2497, sponsored by state Rep. Timm Ormsby (D-Spokane) and championed by Council President Breean Beggs, gives cities a groundbreaking new tool to finance affordable housing projects.

The new law comes on the heels of another major legislative victory for the Council – passage of HB 1590, which allows a small sales tax of .01 percent to generate revenue for housing and behavioral health services. That bill was signed into law by Gov. Inslee on Tuesday.

HB 2497 adds a new definition of “permanently affordable housing” to the list of uses for tax increment financing (TIF) districts and other municipal financing tools that had previously been used primarily to fund infrastructure projects like bike-pedestrian bridges, sidewalks, street lighting and other capital improvements in these taxing districts.

“For the first time, we can dedicate TIF dollars to affordable housing in places like West Central and potentially other parts of Spokane that are desperately in need of more units,” said Beggs. “It’s a game-changer for our city and for people struggling to make ends meet amid rising housing costs and fallout from the COVID crisis.”

TIF districts work by directing extra property tax revenue generated from new developments like Kendall Yards on the north bank of downtown Spokane toward public projects in the surrounding bordering neighborhoods.

Beggs noted that housing advocates and builders, who are sometimes at odds on policy matters, joined in support of the bill. Spokane developer Jim Frank told legislators: “This proposal is a win-win for developers as well as local communities and taxpayers. As founder of Greenstone Corporation, I can testify how these financing tools have been instrumental to the Spokane region, including Kendall Yards, planned improvements on the north bank of the Spokane River as well as West Central and Riverside neighborhoods.”

The new law is the culmination of a multi-year effort by Beggs to create new financial tools for affordable housing. In 2011, he wrote a letter to state Sen. Andy Billig (D-Spokane) saying that using TIF for affordable housing would help "substantially preserve and increase permanently affordable housing in Washington state." Putting it on the Council’s 2020 legislative agenda galvanized bipartisan support for the concept in Olympia.

“We had to jump a lot of hurdles in the Legislature, but got incredible help from our 3rd District legislative team of Senate Majority Leader Andy Billig, House Majority Whip Marcus Riccelli, and House Appropriations Chair Timm Ormsby, who sponsored the bill and went above and beyond to get it passed,” Beggs added.