Here’s what to know before you vote on Olympia’s Home Fund tax

Voters in Olympia will be asked to approve a new kind of tax increase this month — one that would fund affordable housing.

In the Feb. 13 special election, voters will decide on a permanent sales and use tax increase of 0.1 percent that would begin in September. The measure would generate about $2.3 million a year that would go into a dedicated fund for housing, shelters and support services.

The city’s goal is to build or renovate nearly 350 units in the first decade with the help of public and private partners — including about $4.5 million in matching funds each year.

How would it work?

The city would not act as landlord or service provider. Instead, groups would apply for grants to build and operate apartments, shelters, and mental and behavioral health treatment programs. Nonprofit and for-profit developers, property owners and service providers could apply, but any project would have to be approved by the Olympia City Council.

Projects wouldn’t have to be within the city limits, meaning if there is a project elsewhere that would benefit Olympia residents, the city could chip in.

Voters have approved similar measures in Seattle, Bellingham, Ellensburg, and Vancouver, Washington.

Jessica Bateman, an Olympia City Council member and co-chair of the Home Fund campaign, emphasized the measure is meant to provide housing for the most vulnerable, not solve the city’s larger affordable housing shortage. For that, she said, the city is looking to change rules on construction that could increase housing supply to keep up with demand.

Under the city’s plan, 65 percent of the fund’s revenue would go to increasing housing supply. An advisory committee would oversee the process and make recommendations to the City Council.

But Glen Morgan, a Tenino resident who wrote the argument against the measure for the voters’ pamphlet, said he worries about the city’s ability to track spending once the grants go out.

“My biggest concern especially and particularly when it comes to homeless services is lack of accountability on how the money is actually spent and where it goes,” he said. “I think we’re creating a subsidized industry that thrives on getting a lot of money, and a lot of the money doesn’t actually get to solve some of the problem.”

Who would it help?

The housing would go to those making 60 percent or less of the area’s median income. Last year that was $32,100 a year for one person and $46,980 a year for a family of four.

But there’s more: The state law that allows Olympia to enact such a sales tax levy also limits who can benefit to people with mental illnesses or disabilities, veterans, seniors, domestic violence survivors, families with children, and unaccompanied homeless youth or young adults.

As of a year ago, local groups that place people in housing had identified 500 “highly vulnerable households” in Thurston County. Those with the highest needs would be the first in line for these new apartments, said Phil Owen, executive director of the housing nonprofit SideWalk and another co-chair of the Home Fund campaign.

“Our housing market now is in rough shape — the vacancy rates are low and rents are high — but even if things were going well, our folks who live with long-term severe mental illness and chronic health conditions who have been on the streets for a long time (can’t compete),” Owen said.

Forty years ago, many of these people would have lived in some kind of institution, he said. Today they live on the streets and bounce between emergency services, hospitals and jails, often at a cost to taxpayers.

“What we’re talking about really is institutional care out in the community,” Owen said.

What about that levy Olympia voters already approved?

In the fall, Olympia voters approved a property tax increase that will generate about $2.8 million a year for public safety, including a mobile mental health team and more walking patrols downtown. City leaders have described the two ballot measures as related since they both deal with vulnerable people.

“The sequencing of these two ballot measures was very strategic and very intentional,” said Mayor Cheryl Selby, calling a sales tax increase a “regional resource” since about a quarter of sales taxes collected in the city come from nonresidents.

A 2017 poll of Olympia residents found 78 percent would support a housing measure if it was not on the ballot with the public safety measure. Support for both measures fell to 51 percent if they were on the same ballot.

In the same survey, a majority of people identified homelessness as the most significant issue facing the city.

This story was originally published February 3, 2018 at 6:49 AM with the headline "Here’s what to know before you vote on Olympia’s Home Fund tax."