Snohomish County leaders will soon consider a sales tax boost to build new affordable housing as the county grapples with homelessness and rising costs of living.
County Executive Dave Somers and two County Council members on Wednesday proposed raising the county’s sales tax by 0.1% to fund housing for people who are homeless and for people with low incomes.
“For years, the supply of affordable housing has not kept pace with demand, and the spike in housing costs has pushed people to the limits…Without this investment, our economy will weaken, more people will become homeless, and our quality of life will be diminished,” Somers said in a statement.
The proposal follows a change in state law last year allowing local governments to raise sales taxes by 0.1% for affordable housing and services without sending the tax to a public vote. The increase amounts to 10 additional cents on a $100 purchase, or $1 on $1,000.
A handful of cities and counties across the state have passed 0.1% increases since the law passed.
As is the case all across the region, Snohomish County has seen an uptick in homelessness in recent years, and housing costs are climbing. The median one-bedroom apartment in the county costs $1,528, up about 26% from the same time in 2017, according to Apartment List. The median Snohomish county home sold for $695,000 in October.
If the new tax passes, Snohomish County expects to bring in about $23.3 million a year over the next five years. The majority of the funds would be used to buy, build, rehab and operate “affordable, emergency bridge, and permanent supportive housing,” according to the county spending plan. The county would also pay for some behavioral health services.
The county proposal estimates the funds can pay for 100 units of emergency and permanent supportive housing, likely through the purchase of hotels as King County has recently done. Supportive housing combines a place to live with services, including social workers and counselors, for people who are homeless.
The proposal also promises 300 new units of affordable rental housing that would be designed for people making less than 60% of area median income, about $48,600 for a single person.
As of the last point-in-time count in January 2020, an estimated 1,132 people were homeless in Snohomish County including people living outside and in shelters.
The King County Council approved a similar tax increase last fall, even after some of the largest cities in the county dropped out of the county’s plan for the funds and passed their own versions of the tax. In Pierce County, the city of Tacoma has passed the tax increase.
Snohomish County could also see some rancor between city and state leaders.
All seven members of the Lynnwood City Council opposed the tax increase in a Nov. 8 letter to the Snohomish County Council.
“Sales tax is a regressive form of taxation, and we appeal to you and to our state legislature to find other forms of revenue to address the pressing issues of housing and mental health,” the letter said.
“What’s even more regressive is homelessness,” counters Mary Anne Dillon, executive director in Snohomish County for YWCA Seattle-King-Snohomish, who supports the tax.
Snohomish County Councilmembers will discuss the proposal later this month.
Councilmember Nate Nehring said Wednesday he would propose an amendment to send the tax to the ballot instead.
“I would like to see more public input and deliberation before a big decision like this is made,” said Nehring, who also raised concerns about the underlying proposal. “Poor and middle-class people are going to feel it every time they make a purchase.”
Rising costs of living are squeezing out people with low incomes, and the pandemic has exacerbated the need for housing and services, Dillon said.
“This sales tax is a very minimal effect to the taxpayer and will have a maximum effect for our community,” Dillon said.
Lynnwood City Council President George Hurst told the Daily Herald of Everett that, facing a possible county tax, the city council could pass its own tax to keep local control of the funds.
In the city of Snohomish, the city council unanimously adopted its own 0.1% sales tax, the Herald reported Monday.