Affordable and Supportive Housing Sales and Use Tax: Collection and Use of Revenue (December 2023)
- Issuer
- Congressional materials
- Document type
- 2023 Commercereports 2023 Affordable And Supportive Housing Sales And Use T
- Case
- 2023 Commercereports 2023 Affordable And Supportive Housing Sales And Use T
Summary
An annual report on the collection and use of revenues from the Affordable and Supportive Housing Sales and Use Tax, issued by the Housing Division of the Washington State Department of Commerce in December 2023 as a report to the Legislature under RCW 82.14.540(11). It explains that a 2019 state law authorized a local sales tax credited against the state sales tax rate of 6.5%, capped at 0.0146% or 0.0073%, for up to 20 years. For state fiscal year 2023 (July 1, 2022, through June 30, 2023), 126 jurisdictions, 37 counties and 89 cities, received distributions from the Department of Revenue totaling $36,454,276.22. The report states that jurisdictions spent $18,061,726.88, including $12,614,031.98 on capital projects, $4,708,705.88 on operations and maintenance and $738,989.02 on rent assistance. Tables list amounts by jurisdiction and an appendix reprints Chapter 365-240 WAC.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Affordable and Supportive Housing Sales and Use Tax: Collection and Use of Revenue (December 2023).”
Original at app.leg.wa.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2023-commercereports-2023-affordable-and-supportive-housing-sales-and-use-t/
, SHA-256 0a982ee037bfaf96e43080b0db8d958efa309b002fb6a4f6feba9aaef4b75286.Full text
Affordable and Supportive
Housing Sales and Use Tax:
Collection and use of
revenue
Annual report on the collection and use of revenues pursuant to
RCW 82.14.540(11)
December 2023
HOUSING DIVISION Report to the Legislature
Director Mike Fong
v3.4
Acknowledgments
Local Governments
Thank you to all the jurisdictions that contributed
data for this report.
Washington State Department of Commerce
Corina Grigoras, Assistant Director,
Housing Division
Graham Parrington, Senior Housing Policy Analyst,
Housing Division
Reanna McNamara, Policy Coordinator, Housing
Division
1011 Plum St. SE
P.O. Box 42525
Olympia, WA 98504-2525
www.commerce.wa.gov
For people with disabilities, this report is available on
request in other formats. To submit a request, please
call 360-725-4000 (TTY 360-586-0772)
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 2
2.0
Table of Contents
Executive summary...................................................................................................................................... 4
Agency roles and activities .......................................................................................................................... 5
State fiscal year 2023 data overview ............................................................................................................ 6
Appendix A: Chapter 365-240 WAC Affordable and Supportive Housing - Sales and Use Tax ...................... 14
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 3
Executive summary
The 2019 Encouraging Investments in Affordable and Supportive Housing Act (RCW 82.14.540) authorized a
new state-shared local tax for affordable and supportive housing investments. It authorized a local sales tax
option that is a credit against the state sales tax rate of 6.5%. The maximum rate imposed may not exceed
either 0.0146% or 0.0073%. Jurisdictions can receive Affordable and Supportive Sales and Use Tax revenues
for up to 20 years. Counties and cities implementing the tax must report annually to the Department of
Commerce (Commerce) on the "collection and use of the revenues." Commerce completed rulemaking on April
13, 2020, to prescribe the contents of those reports.
Allowable use of funds
Jurisdictions may use Affordable and Supportive Housing Sales and Use Tax revenues to provide housing and
services to persons whose income is at or below 60% of the median income of the city or county imposing the
tax. Counties over 400,000 population and cities over 100,000 population may use the revenue for only the
following activities:
(i) 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); or
(ii) Funding the operations and maintenance costs of new units of affordable or supportive housing.
Counties under 400,000 population and cities under 100,000 population may also use the revenue for providing
tenant-based rental assistance. Jurisdictions may finance loans or grants to nonprofit organizations or public
housing authorities and pledge the tax proceeds to repay bonds under debt limitations imposed by the state
constitution or statute. In some cases, cities and counties share revenue. They may enter into an interlocal
agreement with other cities, counties, and housing authorities to pool and allocate the revenue.
Upcoming changes to the allowable use of funds
Chapter 101, Laws of 2023 (SB 5604) amended the allowable uses for these funds. Jurisdictions reporting
next year, no matter what size, will be able to use these funds for rental assistance. The changes also allow
jurisdictions to use the funds for administrative costs as long as the costs do not exceed 10% of the annual tax
distributed to the jurisdiction.
State fiscal year 2023 data
Commerce collected spending data from jurisdictions from August to October 2023. A total of 126
jurisdictions completed the required annual report on revenue spending for state fiscal year 2023.1
126 (37 counties and 89 cities) jurisdictions received distributions from the Department of Revenue (DOR)
28 of the 126 jurisdictions participate in interlocal partnerships to pool and distribute their revenue.2
The total DOR distribution statewide was $36,454,276.22.
Most jurisdictions did not spend Affordable and Supportive Sales Tax revenue.
24 jurisdictions spent or committed funds toward capital projects.
14 jurisdictions utilized revenue for rent assistance programs.
21 jurisdictions utilized funds for operations and maintenance costs of new housing units.
1 The online report form and instructions are located on the Commerce website at https://www.commerce.wa.gov/affordable-and-
supportive-housing-sales-and-use-tax/
2 These jurisdictions are located in Benton County, Chelan County, Douglas County, Franklin County, Jefferson County, North King
County, South King County, and Thurston County.
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 4
Agency roles and activities
Department of Revenue
The Department of Revenue (DOR) interprets and implements RCW 82.14.540, makes monthly revenue
distributions to jurisdictions, and calculates the maximum tax distribution participating jurisdictions may
receive each year. DOR collects minimal information from jurisdictions to administer the tax.
The maximum authorized tax distribution is based on the jurisdiction's taxable retail sales in state fiscal year
2019 multiplied by the authorized tax rate (0.0073% or 0.0146%). For example, if a city's taxable retail sales
were $1 million in fiscal year 2019, the maximum amount the city may receive is either $73 or $146 per fiscal
year, depending on its authorized rate. If that city had taxable retail sales of $50,000 for a particular month and
was eligible to receive the 0.0073% rate, it would receive $3.65 in tax distribution for that month.
The tax rate is based on three factors at the time of adoption: the date of adoption, the presence of a qualifying
local tax (cities only), and whether the corresponding city or county was a participating jurisdiction.
Department of Commerce
Participating jurisdictions must report to Commerce annually on the "collection and use of the revenues."
Pursuant to RCW 82.14.540, Commerce conducted rulemaking in 2019 and 2020 to prescribe the content of
those reports.
Commerce collects information from jurisdictions on the collection and use of revenues and prepares this
report annually.
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 5
State fiscal year 2023 data overview
Participating jurisdictions
Reported data for state fiscal year 2023 (July 1, 2022, through June 30, 2023):
126 jurisdictions (37 counties and 89 cities) received distributions from the DOR.
DOR distributions statewide totaled $36,454,276.22
Table 1: Participating counties and state fiscal year 2023 distributions
Counties Total distributions
Adams $65,899.16
Asotin $30,949.24
Benton $775,135.80
Chelan $251,582.09
Clallam $190,949.51
Clark $1,143,746.62
Columbia $15,045.26
Cowlitz $161,897.88
Douglas $149,617.39
Franklin $33,108.54
Garfield $6,390.54
Grant $340,995.40
Grays Harbor $105,206.02
Island $160,152.66
Jefferson $79,505.15
King $6,622,946.76
Kitsap $733,459.32
Kittitas $82,063.48
Klickitat $54,212.91
Lewis $300,305.32
Lincoln $15,053.76
Mason $155,051.41
Okanogan $88,154.94
Pacific $43,940.55
Pend Oreille $32,521.14
Pierce $2,259,475.25
San Juan $94,379.60
Skagit $389,690.92
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 6
Counties Total distributions
Skamania $11,908.78
Snohomish $1,665,928.52
Spokane $1,173,163.36
Thurston $749,701.86
Wahkiakum $8,839.09
Walla Walla $96,061.54
Whatcom $917,979.20
Whitman $64,337.46
Yakima $391,803.30
Total $19,461,159.73
Table 2: Participating cities and state fiscal year 2023 distributions
Cities Total distributions
Airway Heights $25,909.91
Anacortes $111,210.89
Arlington $45,923.38
Auburn $201,920.56
Bainbridge Island $60,396.95
Bellevue $880,360.54
Bonney Lake $65,084.83
Bothell $143,581.65
Bremerton $102,426.21
Burien $87,710.70
Burlington $105,291.21
Carnation $4,805.61
Cashmere $7,176.28
Chelan City $17,442.10
Clyde Hill $10,580.06
Covington $58,013.95
Dayton $3,322.66
Des Moines $48,274.27
Duvall $10,214.15
East Wenatchee $44,184.61
Edmonds $96,218.16
Ellensburg $117,847.36
Enumclaw $38,014.00
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 7
Cities Total distributions
Everett $298,763.89
Federal Way $171,275.99
Fife $87,308.23
Forks $5,531.09
Issaquah $160,147.10
Kalama $5,357.88
Kenmore $29,063.26
Kent $254,607.06
Kirkland $288,863.39
Lacey $151,018.65
Lake Forest Park $13,199.76
Lake Stevens $41,883.69
Lakewood $132,265.21
Leavenworth $18,862.90
Longview $98,683.85
Lynnwood $272,984.13
Maple Valley $40,179.06
Marysville $120,265.40
Medina $12,415.53
Mercer Island $50,873.84
Mill Creek $31,773.19
Monroe $61,891.57
Moses Lake $70,319.39
Mount Vernon $90,251.16
Mukilteo $31,680.95
Newcastle $16,684.14
Normandy Park $8,032.15
North Bend $31,747.61
Olympia $442,411.26
Omak $22,783.01
Pasco $131,787.42
Port Angeles $76,860.10
Port Orchard $58,711.50
Port Townsend $28,718.07
Poulsbo $48,813.49
Puyallup $268,277.35
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 8
Cities Total distributions
Quincy $81,883.11
Redmond $361,150.01
Renton $303,436.01
Ridgefield $30,726.96
Sammamish $73,529.80
SeaTac $215,208.20
Seattle $6,009,013.19
Sedro Woolley $18,199.15
Sequim $39,964.20
Shoreline $118,516.24
Snohomish City $51,093.34
Snoqualmie $35,827.88
Spokane City $536,093.02
Spokane Valley $248,661.03
Stanwood $18,810.50
Stevenson $6,407.58
Sumner $66,319.37
Tacoma $1,181,916.16
Tukwila $245,865.18
Tumwater $84,310.52
University Place $33,644.38
Vancouver $826,613.69
Washougal $16,925.25
Wenatchee $115,393.03
Winthrop $4,301.55
Woodinville $89,581.50
Woodway $2,320.53
Yakima (city) $195,949.95
Yarrow Point $1,725.04
Yelm $19,527.81
Total $16,993,116.49
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 9
Jurisdictions' use of funds
Approximately 49 participating jurisdictions spent revenue on new or existing projects. Fourteen jurisdictions
(shown in Table 3) used revenue for rent assistance programs. Twenty-three jurisdictions used revenue for
capital projects (shown in Table 4), 21 used revenue to support operations and maintenance costs of new
units of affordable housing (shown in Table 5), and six used revenue for other expenses (shown in Table 6).
State fiscal year 2023 spending summary:
Jurisdictions spent a total of $18,061,726.88
They spent $738,989.02 on rent assistance
They spent $12,614,031.98 on capital projects
They spent $4,708,705.88 on operations and maintenance
They spent $113,572.04 on other expenses
Table 3: Rent assistance expenditures by jurisdiction
Total households
Jurisdiction Total spent Priority population served
served
Those recovering from the pandemic that have exhausted all other rental
assistance options and will be able to sustain timely rent payments
Arlington $55,518.00 25 moving forward as well as those that are now over-housed as a result of
rental increases who need assistance finding and obtaining more
affordable housing.
Covington $33,488.00 36 No data
Dayton $14,754.66 22 Low-income
We distribute the funds to Plateau Outreach Ministries who offer that
Enumclaw $35,000.00 No data
funding for rental assistance and utility assistance vouchers.
Garfield County $14,101.00 No data No data
Kirkland $68,372.91 170 No data
Longview3 -$58,500.004 -31 No data
Residents of Mercer Island with household incomes below 80% King
Mercer Island $57,141.95 34
County AMI at elevated risk for eviction or homelessness.
Mount Vernon $55,000.00 No data Homeless, immigrants
Poulsbo $2,250.00 6 Very low income, disabled
SeaTac $154,577.01 150 Low Income (at or below 60% area median income (AMI))
Shoreline $64,759.60 28 Low-income
Stanwood $31,828.22 No data No data
Tukwila $26,747 24 60% or less AMI.
Whatcom County $125,450.67 56 Singles, families with children, young adults ages 18-24
Total $738,989.02
3 The city of Longview corrected their reporting from 2022. They reported $58,500 for Rent Assistance for 31 units last year, but noticed
this was reported in error and the funds they reported were for another funding source. Longview did not spend any of their Affordable
& Supportive Housing Sales and Use Tax in the 2022 or 2023 reporting periods.
4 Not included in the total reported this year.
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 10
Table 4: Capital project expenditures by jurisdiction
Jurisdiction Total spent Activity New projects and units
Anacortes $712,495.00 Construction 41 units under construction
45 units to house our homeless
Burlington $401.81 No data
population
Heritage Heights at Lake Chelan-
Chelan City $19,453.47 Rehabilitation
Memory Care Remodel
$17,505.45 was used on rehabilitation
Clark County $34,900.55 projects; $17,395.10 was used on a 12 units under construction
new construction project
Everett $13,845.83 No data No data
Fife $103,335.55 No data No data
ILA (ARCH-A): Bothell, Clyde Hill,
Kenmore, Newcastle, Redmond, $5,500,000.00 New construction 260 units under construction
Sammamish, Woodinville, Yarrow Point
ILA: Chelan County/Douglas County $156,589.07 No data No data
ILA: Jefferson County/Port Townsend $451,238.00 Construction No data
King County $2,000,000.00 Construction 40 units under construction
3 single family households at or
Lakewood $33,223.02 Rehabilitation
below 60% AMI
Building permit for a low-income
Leavenworth $8,505.68 Rehabilitation approved apartment complex to do
a remodel of the facility.
Pierce County $3,527,000.00 Construction 87 units under construction
Port Orchard $41,700.00 Rehabilitation No data
Poulsbo $11,344.00 No data No data
Total $12,614,031.98
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 11
Table 5: Operations and maintenance expenditures by jurisdiction
Jurisdiction Total expenditures Units supported
Bremerton $100,000.00 10
Burlington $579,417.08 45
Cashmere $5,780.29 22
Clark County $430,656.60 40
ILA :Jefferson County/Port Townsend $251,441.00 107
King County $226,551.56 92
Lake Forest Park $16,344.00 No data
Lincoln County $8,750.16 8
Moses Lake $75,357.24 38
Mount Vernon $55,000.00 No data
North Bend $32.75 0
Pacific County $40,059.94 16
Poulsbo $13,594.00 6
San Juan County $41,821.78 2
Seattle $1,071,702.31 92
Skagit County $129,837.99 70
Spokane City $422,909.11 123
Stanwood $999.35 No data
Vancouver $1,179,896.49 40
Whatcom County $58,554.23 27
Total $4,708,705.88
Table 6: Other expenses reported
Jurisdiction Total expenditures Use of funds
Clark County $13,781.21 Administration costs
Distributed to Plateau Outreach Ministries who offer that
Enumclaw $35,000.00
funding for utility assistance vouchers.
Kittitas County $69.35 Postage, minimal salaries.
Funds were distributed to the King County Regional
Lake Forest Park $16,344.00 Homelessness Authority to provide emergency housing
through a severe weather shelter.
Mason County $47,568.75 Needs assessment
Whatcom County $808.73 Administration costs
Total $113,572.04
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 12
Affordability restrictions for new units
Some jurisdictions opt to set income restrictions below the statutory minimum and apply long-term
affordability covenants to their respective capital project portfolios. However, many jurisdictions have limited
capacity to report the details of projects placed in service, and such data points often fall outside their
established reporting systems. In addition, smaller cities and counties do not generally have affordable
housing administrators, developers, or managers on their staff. Jurisdictions may need more time to develop
the policies, procedures, partnerships or reporting systems needed to accurately report affordability details
related to housing units funded with tax revenue.
Four jurisdictions reported on affordability restrictions applied to funded units:
The city of Anacortes supports 21 units with a 10- to 15-year affordability restriction; those units support
formerly homeless families earning 30-50% of the AMI, and five units with a 31+ year affordability
restriction; those units support households earning 60% of the AMI.
The city of Burlington supports 45 units with a 10- to 15-year affordability restriction; those units support
the homeless population.
Okanogan County supports 16 units with a 26- to 30-year affordability restriction; those units support
senior citizens.
The city of Seattle supports 204 units with a 31+ year affordability restriction; those units serve the
homeless population, households earning 30% of the AMI or less, and people with disabilities.
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 13
Appendix A: Chapter 365-240 WAC
Affordable and Supportive Housing - Sales and Use Tax
365-240-010
Authority.
This chapter is promulgated pursuant to the authority granted in RCW 82.14.540 requiring counties and
cities that impose the local sales and use tax for affordable and supportive housing to report annually to
the department of commerce on the collection and use of the revenue and for the department of
commerce to adopt rules prescribing the content of those reports.
[Statutory Authority: RCW 82.14.540(11). WSR 20-09-064, § 365-240-010, filed 4/13/20, effective 5/14/20.]
365-240-020
Authorized uses of tax revenue.
Counties with populations over four hundred thousand and cities with populations over one hundred
thousand may use tax revenue for:
(1) 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); or
(2) Operations and maintenance costs of new units of affordable or supportive housing.
Counties with populations under four hundred thousand and cities with populations under one hundred
thousand population may use tax revenue for the activities outlined above, as well as to provide rental
assistance to tenants that are at or below sixty percent of the median income of the county or city that is
imposing the tax.
[Statutory Authority: RCW 82.14.540(11). WSR 20-09-064, § 365-240-020, filed 4/13/20, effective 5/14/20.]
365-240-030
Annual report to the department of commerce.
Jurisdictions must submit a report to the department by October 1st annually with the following
information pertaining to the most recent fiscal year. Reports submitted by a lead jurisdiction or managing
entity pursuant to an interlocal agreement must be accompanied by contract language designating the
responsible entity for submitting annual reports and ensuring their accuracy.
The first report will be due October 1, 2020, and annually thereafter.
(1) General:
(a) All references made in this section to funds, funds pooled, or funds utilized or bonded against are in
regard to those derived from a jurisdiction's affordable and supportive housing sales and use tax
distribution from the department of revenue for the corresponding fiscal year.
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 14
(b) An annual report submitted by a lead jurisdiction or managing entity pursuant to an interlocal
agreement must be accompanied by agreed language designating it as the responsible party for report
timeliness and accuracy.
(c) Information submitted by a lead jurisdiction or managing entity pursuant to an interlocal agreement
must include the total combined revenue collection and program activities for all jurisdictions subject to
the agreement. A separate report on revenue collection and program activities must be submitted for each
jurisdiction choosing to additionally expend funds outside the agreement, if applicable.
(d) All reports submitted pursuant to this section must include contact information for the preparer.
(2) Revenue collection:
(a) Total affordable and supportive housing sales and use tax distribution for the reporting jurisdiction(s);
(b) Applicable affordable housing and supportive housing sales and use tax rate(s) for the reporting
jurisdiction(s);
(c) If an interlocal agreement is in place, the total revenue utilized jointly pursuant to the agreement;
(d) If an interlocal agreement is in place, the total revenue utilized by jurisdiction(s) separately, not
according to the terms of the agreement.
(3) Program activities:
(a) Total funds committed;
(b) Number, types, and status of projects supported with funds;
(c) Degree of leverage with other public and private funds;
(d) Total funds utilized for rent assistance; and
(e) Duration of affordability for projects supported with funds.
(4) Program outputs:
(a) Total funds committed for loans and grants;
(b) Total funds obligated to support bonding activities;
(c) Total funds committed for operations and maintenance of new units of affordable or supportive
housing;
(d) Total number of households served with funds used for rent assistance; and
(e) Target populations served with funds.
[Statutory Authority: RCW 82.14.540(11). WSR 20-09-064, § 365-240-030, filed 4/13/20, effective 5/14/20.]
2023 AFFORDABLE AND SUPPORTIVE HOUSING SALES AND USE TAX 15
File and source
- File
- 2023_commercereports-2023-affordable-and-supportive-housing-sales-and-use-t.pdf
- Size
- 331,909 bytes
- SHA-256
- 0a982ee037bfaf96e43080b0db8d958efa309b002fb6a4f6feba9aaef4b75286
- Original
- app.leg.wa.gov