Spokane Municipal Code

Title 08 Taxation and Revenue

Chapter 08.15 Multiple-family Housing Property Tax Exemption

Section 08.15.090 Exemption – Duration - Limits

1. The assessed value of new housing construction, conversion and rehabilitation improvements qualifying under this chapter will be exempt from ad valorem property taxation as follows:

1. 1. For purposes for which applications for certificates of tax exemption eligibility are submitted under this chapter the value is exempt for:

1. 1. 1. within the Spokane Targeted Investment Area eight successive years beginning January 1st of the year immediately following the calendar year of the recording of the Final certificate with Spokane County Assessor;

1. 1. 1. Student housing and congregate living housing can only qualify for the eight-year tax exemption;

1. 1. 2. within the Spokane Targeted Investment Area (STIA) and the Affordable Housing Emphasis Area twelve successive years beginning January 1st of the year immediately following the calendar year of the recording of the final certificate of tax exemption with Spokane County Assessor;

1. 1. 3. For the property to qualify for the twelve-year exemption, the applicant must provide units as affordable by meeting or exceeding the following requirements:

1. 1. 1. 1. For projects of 4-11 new housing units the applicant must commit to renting or selling at least twenty-five percent of the multi-family housing units as affordable housing units to low and moderate-income households.

1. 1. 1. 2. For projects of 12 or more new housing units the applicant must commit to renting or selling at least thirty percent of the multi-family housing units as affordable housing units to low and moderate-income households.

1. 1. 1. 3. In the case of projects intended exclusively for owner occupancy, the requirement for a minimum of twenty-five percent of the units to be affordable under this subsection may be satisfied solely through housing affordable to moderate-income households;

1. 1. 1. 4. Properties within the Affordable Housing Emphasis Area are not eligible to convert the final certificate of tax exemption to an eight year market rate certificate of tax exemption.

1. 1. 4. within the Spokane Targeted Investment Area (STIA) and the Affordable Housing Emphasis Area twenty successive years beginning January 1st of the year immediately following the calendar year of the recording of the Final certificate with Spokane County Assessor;

1. 1. 1. 1. For the property to qualify for the twenty year exemption under this section, at least twenty-five percent of the units must be sold to a qualified nonprofit or local government partner that will assure permanent affordable homeownership. The remaining seventy-five percent of units may be rented or sold at market rates;

1. 1. 1. 2. Permanently affordable homeownership units must be sold to low income households earning no more than 80 percent of the area median income.

2. The exemption does not apply to the value of land, commercial uses, or non-permanent housing related improvements not qualifying under this chapter, nor does the exemption apply to increases in assessed valuation of land and non-qualifying improvements, or to increases made by lawful order of the Spokane County board of equalization, the Washington State department of revenue, state board of tax appeals, or Spokane County, to a class of property throughout the county or a specific area of the county to achieve uniformity of assessment or appraisal as required by law. In the case of rehabilitation of existing buildings, the exemption does not include the value of improvements constructed prior to the exemption beginning.

3. Units within the 12-yr programs that are set side for low and moderate income household must:

1. be dispersed throughout the building and distributed proportionally among the buildings;

2. not be clustered in certain sections of the building or stacked;

3. be comparable to market-rate units in terms of unit size and leasing terms; 

4. be comparable to market-rate units in terms of functionality and building amenities and access.

4. At the end of both the tenth and eleventh years for twelve-year exemptions, applicants must provide tenants of rent-restricted units with notification of intent to provide the tenant with rental relocation assistance as provided in SMC 8.15.090.

1. 1. Except as provided in subsection SMC 8.15.090 D.2 below, for any twelve-year exemption authorized pursuant to SMC 8.15.090 after July 25, 2021, at the expiration of the exemption the applicant must provide tenant relocation assistance in an amount equal to one month's rent to a qualified tenant within the final month of the qualified tenant's lease. To be eligible for tenant relocation assistance under this subsection, the tenant must occupy an income-restricted unit at the time the exemption expires and must qualify as a low-income household under this chapter at the time relocation assistance is sought.

1. 2. If affordability requirements consistent, at a minimum, with those required for twelve-year exemptions, remain in place for the unit after the expiration of the exemption, relocation assistance in an amount equal to one month's rent must be provided to a qualified tenant within the final month of a qualified tenant's lease who occupies an income-restricted unit at the time those additional affordability requirements cease to apply to the unit.

1. 3. No new exemptions may be provided under this section beginning on or after January 1, 2032.

Date Passed: Monday, August 15, 2022

Effective Date: Sunday, September 25, 2022

ORD C36243 Section 9