County council approves 0.1% sales tax to fund affordable housing, behavioral health

The Snohomish County Council’s Dec. 15 public hearing on the proposed sales tax increase was held via Zoom. (Composite created from individual pictures of councilmembers speaking Wednesday.)

The Snohomish County Council Wednesday voted 3-2 in favor of adopting a 0.1% sales and use tax countywide to fund more affordable housing and behaviorial health services

Beginning in April 2022, the county will collect $0.01 per $10 purchase. It is expected to raise approximately $116 million over the next five years.

The five councilmembers listened to more than three hours of comments during Wednesday’s public hearing before voting on the measure, with the vote ultimately falling along party lines. Council Democrats supported its immediate approval while Republicans proposed that the measure instead go before county voters next spring.

“Today’s decision is one of many actions we are taking to address the housing affordability crisis and homelessness,” said Council Chair Stephanie Wright, a Democrat who represents the 3rd District that includes Edmonds and Lynnwood. “The housing crisis is an overwhelming burden for too many Snohomish County residents, and we must take action now to help those who are struggling. These strategies will help stabilize families, get people off the streets, and provide the services they so desperately need. Public safety and the health of our community require these bold steps.”

County officials anticipate that in the next five years, the fund created by the new tax will support creation of a projected 300 new units of affordable housing. That would more than double the current production rate and increase the county’s total number of new affordable housing units to 522. The fund is also predicted to create at least 100 new units of bridge and permanent supportive housing which, when combined with other investments, could move up to 42% of all unsheltered residents off the streets and into safer places.

“Housing affordability is negatively impacting people across the economic spectrum in Snohomish County,” said Councilmember Jared Mead, a 4th District Democrat who represents Mountlake Terrace and Brier. “This is a modest and sensible approach to the crisis that is facing too many families. If we act now with the urgency this crisis demands, we can begin to make progress. Doing nothing would be easier but also leave us with problems that become even more difficult to solve.”

Council Vice Chair Megan Dunn, a 2nd District Democrat, said she was “proud to support this effort to address homelessness and the lack of affordable housing stock.” She added, “There are families across the county who are suffering because the skyrocketing housing costs and lack of housing options have left them without shelter or living in precarious situations. We can start to make a difference with these investments.”

Opponents of the tax said they felt it was regressive and also noted that some Snohomish County cities already have sales tax rates that are among the highest in Washington.

Councilmembers Sam Low and Nate Nehring, who represent the county’s 5th and 1st Districts, respectively, voted against the sales tax increase. Both acknowledged there is a need to address issues of affordable housing and behavioral health services, but said they felt the process was flawed, lacked transparency and was rushed in its timing — and also said that the measure should instead be brought before voters in a special election next April.

Earlier this week, some elected officials from the cities of Brier, Edmonds, Lynnwood, Mountlake Terrace and the Town of Woodway were among the 58 names included on a letter sent to the county council and Snohomish County Executive Dave Somers asking that the proposed sales tax increase instead be placed on an upcoming ballot for a public vote.

Nehring said the tax proposal should have been discussed during a council committee meeting, and added that allowing more time to gather additional input before a public vote would have been beneficial.

Throwing more money at the affordable housing problem isn’t necessarily always the answer, Nehring said, pointing to both Seattle and King County as examples he hoped to avoid.

“My fear is that if our only move is going to be to raise sales taxes and subsidize the costs of housing, which is not a long-term solution — it’s a Band-Aid — then we’re absolutely setting ourselves up for the same path of failure,” Nehring said. “And I have yet to hear how what we’re planning to do is much different than the approach that is being taken in Seattle.”

Nehring said he would instead prefer the council discuss how it might possibly reduce barriers to homeownership through policy changes such as making regulatory reductions, increasing the housing supply and advocating for Growth Management Act reform at the state level. “If I thought we could solve homelessness through this proposal, I’d be happy to support a tax increase, but I don’t think this is going to move things an inch,” he added. “I don’t have confidence in the plan that’s before us.”

Low said the council should have broached the issue during its budgeting process: “This council just passed a historic and record $1.2 billion budget, which included record revenues, last month,” he said. “I don’t believe it was fair to the public that this additional housing need was not presented during the three-month budget process so it could be prioritized in the budget.” He added: “It’s additional taxpayers’ money that we’re now asking for, out of their wallets, they should get a voice in this too, that is why I support it going to a vote of the people.”

Councilmembers in favor of the tax said the council is elected to make what at times can be tough decisions and that voters will ultimately reflect their support of those choices when deciding whether to re-elect them.

Several on the council noted they appreciated the various perspectives provided in comments, along with the sheer volume of input received from the community, which they felt had helped lead to robust discussions on the proposal.

Both Nehring and Low also supported an amendment to sunset the tax after five years, with the option of renewing it if a set of metrics — to be agreed upon by the council — have been achieved at that time. That amendment, along with two others, failed to pass by a council vote of 3-2. One of those amendments was related to the chemical dependency/mental health advisory board’s powers and duties to include oversight and recommendations on the use of the funds collected under the tax. The other would have required the allocation of at least 25% of the tax’s funds to behavioral health-related expenditures such as acquiring land and constructing such facilities along with operating treatment programs and services.

An amendment to the ordinance was unanimously passed ensuring that the Snohomish County Executive’s office will coordinate with the council, cities and community partners on the creation of a final business expenditure plan for the tax’s funds. Those efforts include coordinating any proposed spending on affordable housing, shelter, and behavioral health projects with the Snohomish County Housing and Community Development Technical Advisory Committee and also the Policy Advisory Board — both of which have representatives from impacted communities, cities, towns and housing experts. That plan must then be presented to the council for its consideration and ultimate approval prior to any expenditure of funds.

The Washington State Legislature passed House Bill 1590 (HB 1590) last year, which allows for cities and counties to pass a 0.1% sales and use tax that can provide funding for affordable housing.

“The council has shown real leadership today, and I’m looking forward to working with them, our community, city and tribal partners to ensure these funds are fairly and equitably spent to address the needs of our residents throughout the county,” Snohomish County Executive Dave Somers said in a statement. “No one can deny that there is a housing affordability crisis, and no one can argue against the need to take bold action. We cannot allow this crisis to further erode our economy, our environment, and the health of our community. We will now begin to make a difference.”

Other counties and cities in Washington using the authority granted in HB 1590 to increase the stock of affordable housing by authorizing a 0.1% sales tax include Jefferson, King, Skagit, Spokane and Whatcom counties, and the cities of Anacortes, Ellensburg, Olympia, Port Angeles, Poulsbo, Snohomish, Tacoma and East Wenatchee/Wenatchee.

— By Nathan Blackwell

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