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STATE OF WASHINGTON
County of Jefferson
DECLARING THE INTENT OF JEFFERSON
COUNTY TO AUTHORIZE A SALES AND
USE TAX FOR AFFORDABLE AND RESOLUTION NO. 5 2-19
SUPPORTIVE HOUSING IN ACCORDANCE
WITH SUBSTITUTE HOUSE BILL 1406
(CHAPTER 338, LAWS OF 2019), AND
OTHER MATTERS RELATED THERETO
WHEREAS, in the 2019 Regular Session, the Washington State Legislature approved,
and the Governor signed, Substitute House Bill 1406 (Chapter 338, Laws of 2019) ("SHB
1406"); and
WHEREAS, SHB 1406 authorizes the governing body of a city or county to impose a
local sales and use tax for the acquisition, construction or rehabilitation of affordable housing or
facilities providing supportive housing, and for the operations and maintenance costs of
affordable or supportive housing, or, for providing rental assistance to tenants; and
WHEREAS, the tax will be credited against state sales taxes collected within the County
and, therefore, will not result in higher sales and use taxes within the County and will represent
an additional source of funding to address housing needs in the County; and
WHEREAS, the tax must be used to assist persons whose income is at or below sixty
percent of the County median income; and
WHEREAS, on July 31, 2017, the Jefferson County Board of Commissioners adopted
Resolution No. 35-17, finding "that an emergency exists with respect to the availability of
housing that is affordable to low-income households and with respect to the availability of
housing that is affordable to very low-income households in Jefferson County," and has
determined that imposing the sales and use tax authorized by SHB 1406 to help address this need
will benefit its citizens; and
WHEREAS, SHB 1406 authorizes the County to enter into an interlocal agreement with
one or more counties, cities, or public housing authorities for purposes of pooling the tax monies
received, allocating the proceeds, or pledging these taxes to bonds issued by one or more parties
to the agreement, all in accordance with the interlocal agreement and SHB 1406; and
WHEREAS, in order for a city or county to impose the tax, within six months of the
effective date of SHB 1406, or January 28, 2020, the governing body must adopt a resolution of
intent to authorize the maximum capacity of the tax, and within twelve months of the effective
date of SHB 1406, or July 28, 2020, must adopt legislation to authorize the maximum capacity of
the tax; and
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WHEREAS, Jefferson County intends to use these tax monies in collaboration with the
City of Port Townsend as a means to fully leverage the resources under SHB 1406; and
WHEREAS, this resolution constitutes the resolution of intent required by SHB 1406;
and
WHEREAS, the Jefferson County Board of Commissioners now desires to declare its
intent to impose a local sales and use tax as authorized by SHB 1406 as set forth herein;
NOW, THEREFORE, BE IT RESOLVED BY THE JEFFERSON COUNTY
BOARD OF COMMISSIONERS AS FOLLOWS:
Section 1. Resolution of Intent. The Jefferson County Board of Commissioners
declares its intent to adopt legislation within one year of the effective date of SHB 1406, or by
July 28, 2020, to levy the maximum capacity of the sales and use tax authorized by SHB 1406,to
be credited against state sales taxes collected within the County.
Section 2. Further Authority; Ratification. All Jefferson County officials, their
agents, and representatives are hereby authorized and directed to undertake all action necessary
or desirable from time to time to carry out the terms of, and complete the actions contemplated
by, this resolution. All acts taken pursuant to the authority of this resolution but prior to its
effective date are hereby ratified.
Section 3. Effective Date. This resolution shall take effect immediately upon its
adoption.
DATED this/'f day of October, 2019
;, BOARD OF JEFFERSON COUNTY COMMISSIONERS
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ATTEST: Davis iiih„i .n a •• :-
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Caroly Gallaway 1 Greg Brotherton, Member
Deputy Clerk of the Board
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JEFFERSON COUNTY
BOARD OF COUNTY COMMISSIONERS
AGENDA REQUEST
TO: Board of Commissioners
FROM:Philip Morley, County Administrates'` /
DATE: October 14, 2019
RE: Proposed Resolution of Intent of Jefferson County to Authorize a Sales and Use Tax
for Affordable and Supportive Housing in Accordance With Substitute House Bill 1406
STATEMENT OF ISSUE: The Board of County Commissioners (BoCC) will consider adopting
a proposed Resolution stating the BoCC's intent to authorize the County to collect a sales and
use tax—deducted from the existing state sales tax, so there is no change to the consumer—to
support affordable housing and supportive housing serving low income people at or below 60%
of Area Median Income. This new revenue stream for affordable housing was authorized this
year with the enactment of Substitute House Bill 1406 (SHB 1406).
To impose the sales and use tax deducted from the state's sales and use tax, and receive this
revenue locally, SHB 1406 requires a two-step process: a Resolution of intent, followed by an
Ordinance. This proposed Resolution is the first step.
ANALYSIS: A pervasive lack of affordable housing is a pressing challenge throughout
Jefferson County, especially for people with lower incomes. In 2017, the Jefferson County
Board of Commissioners adopted Resolution No. 35-17, finding "that an emergency exists with
respect to the availability of housing that is affordable to low-income households and with
respect to the availability of housing that is affordable to very low-income households in
Jefferson County."
In 2019, the Washington State Legislature approved Substitute House Bill 1406 (Chapter 338,
Laws of 2019) ("SHB 1406") authorizing a city or county to impose a local sales and use tax for
the acquisition, construction or rehabilitation of affordable housing or facilities providing
supportive housing, and for the operations and maintenance costs of affordable or supportive
housing, or, for providing rental assistance to tenants to assist persons whose income is at or
below sixty percent of the County median income. The tax is credited against state sales taxes
collected within the County and, therefore, will not result in higher taxes.
Imposing the SHB 1406 sales and use tax in Jefferson County and using the revenue for
affordable housing will help address this need, and benefit citizens.
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For Jefferson County to impose the tax, the BoCC must adopt a resolution of intent to
authorize the tax by January 28, 2020, and must subsequently adopt an ordinance to authorize
the tax, by July 28, 2020.
Jefferson County intends to use these tax monies in collaboration with the City of Port
Townsend as a means to fully leverage the resources under SHB 1406. SHB 1406 authorizes
the County to enter into an interlocal agreement for purposes of pooling the tax monies
received, and allocating the proceeds. County and City staff are preparing a possible
amendment to fold SHB 1406 revenues into an existing interlocal through which the County
and City already cooperate on using recording fee revenues for homeless housing and
affordable housing. In addition to formalizing the County's intent to collect the SHB revenue,
the proposed Resolution also ratifies the work to collaborate on an interlocal with the City.
The resolution would take effect immediately upon adoption. Once approved, staff would
send a copy to the State of Washington, and we would also notify the City of Port Townsend,
which is considering its own resolution of intent.
FISCAL IMPACT: Assuming the City of Port Townsend also levies the tax, and if the value
of sales and use in the future is the same as the most recent 12-months of statistics (2nd
Quarter 2018 through the end of 1st Quarter 2019) from the Washington Department of
Revenue,the sales tax would generate the following amounts for the County and City per year:
County Levy&Separate City Levy County% County$$ City% City$$ Both$$
W/in City of Port Townsend 0.0073% $ 21,358 0.0073% $ 21,358
W/in Unincorporated County 0.0146% $ 40,066 • 0.0 % $ -
Total $ 61,424 $ 21,358 $ 82,782
Retail Sales&Use:2nd Qtr 2018-1st Qtr 2019 County $274,424,133
City $292,573,455
TTL $ 566,997,588
Retail Data Source: Washington Department of Revenue.Taxable Retail Sa i es
RECOMMENDATION: Pass a motion to adopt the proposed Resolution of Intent of
Jefferson County To Authorize A Sales And Use Tax For Affordable And Supportive Housing In
Accordance With Substitute House Bill 1406.
REVIEWED BY:
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