AWC priority bill HB 2620 is scheduled for a hearing and committee vote this week and needs your support. The bill is requested by the Governor and is sponsored by Rep. Amy Walen (D–Kirkland).
This proposal expands the Multifamily Tax Exemption (MFTE) program in two ways:
- Includes all cities and towns in the state; and
- Authorizes as a local option an extended tax abatement to continue to preserve affordable units or to create new affordability set-asides within buildings that have previously benefited from the program.
Extending the MFTE program timeline will address the looming cliff where more than 7,000 currently rent-restricted units are set to age out of the program. If these units turn over to market rate rents, it will create a significant additional shortage in the state’s inventory of affordable housing.
If your city is supportive of the MFTE extension, we need you to share that support with your legislators.
Many discussions and negotiations have occurred trying to arrive at the exact parameters of this bill. Low-income housing advocates and others want to deepen the affordability requirements and provide greater tenant protections. The challenge we are trying to balance is that this is a voluntary program and it needs to attract private building owners. In some markets, an affordability set-aside is workable based on what levels of rent the real estate market supports; however, in other cities, if those restrictions are in place the building owners would not participate, defeating the purpose.
HB 2746, sponsored by Rep. Alex Ramel (D–Bellingham), also proposes changes to the MFTE program and is being heard at the same time. We are very concerned with this version. HB 2746 adds a new 15% affordability requirement to the existing market rate 8-year tax exemption option, and a deeper 25% affordability set-aside for the 12-year program. In both cases, the bill requires the development to include a percentage of larger units, with two or more bedrooms. While these are laudable goals when the real estate market will support an apartment building foregoing that level of revenue, we are very concerned that these standards would effectively render the program unusable in many communities.
These bills are facing a lot of critique and concern. If your city is supportive of the MFTE extension, we need you to share that support with your legislators. Let them know that you support HB 2620 and companion SB 6411 (heard previously), and that you oppose HB 2746. We need the state to expand this vital tool to attract multifamily development with an optional affordability component, and we need the program to remain flexible enough that it can be tailored to work in every community. If you get a response from your legislator, we would greatly appreciate it if you would share it with Carl.
Dates to remember
HB 2620 and HB 2746 are scheduled for public hearing in the House Finance Committee at 8 am on Tuesday, February 4. Both bills are scheduled for a committee vote at 1:30 pm on Friday, February 7.