0212 sales tax

If approved, the sales tax for affordable housing would help fund construction of affordable apartments and townhouses by the Anacortes Housing Authority and the Anacortes Family Center. The 1891 Olson Building, in Old Town Anacortes, would be renovated for affordable apartments. (Anacortes American / File photo)

A 1/10 of 1% sales tax to fund affordable housing construction was passing in early vote returns Tuesday.

The vote as of 9:52 p.m. Tuesday was 2,749, or 55.58%, in favor; 2,197, or 44.42%, opposed.

The sales tax — combined with a share of state sales tax — would generate about $13 million over 20 years for affordable housing. The 1/10th of 1% equates to 1 cent per $10 spent on goods subject to sales tax, according to city Finance Director Steve Hoglund.

The revenue would fund construction of the Anacortes Family Center’s planned 20-unit affordable apartments and child care, renovate the Anacortes Housing Authority’s Olson Building for up to 20 affordable apartments and first-floor commercial spaces, and build five housing-authority townhouses on 19th Street.

If the measure passes, things will to start happen quickly, Housing Authority Executive Director Brian Clark said before polls closed.

The Housing Authority will start securing funding for construction of the townhouses — bank financing will be repaid with revenue from the sales tax measure — and then pursue restoration and renovation of the Olson Building. The latter project will be funded with sales tax revenue, tax credits, Community Development Block Grant funding, and affordable housing funds available through the county.

The townhouses could be finished by the end of the year, Clark said.

He was hopeful early Tuesday of the ballot measure's passage, and found reason to look on the bright side if it did not.

"If it doesn’t pass, I don’t think it will have been a wasted effort," he said. "It brought up the issue of affordable housing. We will have a little house on 19th Street (on the townhouse site) and the tenants will be able to stay where they are. And we will pursue other options for the Olson Building."

‘Less expensive’ vs. ‘affordable’

Eric Johnson, a former City Council member who co-authored the ballot argument in favor of the measure, said several voters he’d spoken with mistakenly associated the measure with the five-story apartment building proposed at 18th Street and O Avenue. The developer, Madrona Real Estate Services, was allowed by city development regulations to build a fifth floor as long as 25% of the apartments are 600 square feet, the idea being a smaller apartment would be less expensive than a larger one.

Johnson pointed out there’s a difference between “less expensive” and “affordable.”

“Affordable housing” is defined as housing that is affordable to households with an income 50% or less of the area median income for rentals, and 80% or less of the area median income for owner-occupied housing, according to the Anacortes Municipal Code. “Affordable” means housing costs do not exceed 30% of household income.

According to a city report, the U.S. Department of Housing and Urban Development estimates 33% of Anacortes households (48% of renters and 25% of owners) spend more than 30% of their income on housing and may have difficulty affording other necessities such as food and medical care.

No one volunteered to write a ballot argument opposed to the measure.

The median household income in Anacortes in 2017 was $71,291. A household earning 50% of the median would bring in $35,645 a year. HUD assumes 30% of that income — $891.13 each month — covers monthly housing expenses, with the rest covering living expenses.

Most rents in Anacortes by private landlords are typically over $1,000. Comparatively, rents at the Anacortes Family Center’s Launch Apartments range from $650 for a studio to $750 for a two-bedroom.

“In every study done dating to the early 2000s, the number one concern expressed by residents has been how do we get affordable housing in the city,” Johnson said. The affordable housing sales tax “is the only way I can see to do that. The only other way is rent control, which nobody wants.”

Bonnie Bowers, an Anacortes port commissioner and former Anacortes police chief, said people who live in the communities in which they work become invested in their communities.

“They take ownership of it. It’s that simple,” she said. “When you work here and your children go to school here and you use our hospital and our library, you become invested in the community. You want to make it better.”

There are other reasons. “When you’re commuting 20 miles at $3.80 a gallon and you’re making $15 an hour, that’s a significant portion of your income,” Bowers said.

The city estimates it will need 971 new affordable units through 2036 to meet affordable-housing needs. The apartments and townhouses that would be built using the sales tax would comprise 4.8% of the 2036 need.

The city has established other methods of creating housing that is “more affordable,” though they may not meet the definition of “affordable housing.” Among them: allowing the long-term rental of accessory dwelling units, construction of cottages and the building height bonus.

Johnson said the city should consider building affordable housing on land it owns near Sharpes Corner.

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