Issues in Action

Industry Advocacy Report – December 10, 2024

WE DID IT! Energy Choice Has Been Preserved in Washington!

As of December 5, 2024, I-2066 is now law. What this means for our members is still ongoing. We expect there will be conflict and confusion in the coming months, but we ask that members refer to the guidance from BIAW and attempt to maintain some level of patience and understanding with your local jurisdictions. The total impact from this measure is not fully understood and local officials are also attempting to understand what and what not o enforce. Recently released guidance from BIAW is as follows: Washington’s new energy choice law went into effect Thursday, but questions remain about what’s next.

Here’s what we know:

  • Secretary of State Steve Hobbs officially certified the election Wednesday.
  • Initiative 2066 became law Thursday.
  • The new law itself is very simple: It protects natural gas as an energy choice and prohibits natural gas bans, restrictions, or disincentives in any form anywhere across the state.

But some policymakers and code officials are trying to make things more complicated.

BIAW has laid the groundwork.
BIAW’s General Counsel Ashli Penner has written letters to the Washington State Building Code Council as well as to local building officials and elected officials. The letters provide multiple options to comply with the law. She also sent letters to county prosecutors and city attorneys, asking for their help in ensuring compliance.

What’s next?
BIAW’s legislative director Andrea Smiley has also worked closely with experts on the code to develop several guidance documents for BIAW members to work with their local building officials.

What should builders expect when filing permit applications?
As of today, local building departments should not be enforcing any penalties for permit applications that include natural gas service. Local officials are required to follow state law.

Questions? Please let us know which jurisdictions are still enforcing the 2021 Washington State Energy Code in violation of our new law.

If you have any questions or need help navigating compliance with the new law, please contact BIAW Legislative Director Andrea Smiley (AndreaS@BIAW.com).

 

 

 

INDUSTRY ADVOCACY REPORT – November 18, 2024

 New Issues Alert!
Regional Housing Council Ignores Advisory Committee on Legislative Agenda – Thurston RHC met on Wednesday, November 13th, to set their 2025 legislative priorities. In the previous three months, the list of potential legislative priorities has been discussed and debated at length in the two advisory committees that provide recommendations to the RHC on these matters. Those advisory committees are the Thurston Affordable Housing Advisory Board (TAHAB, we are stakeholders on this committee) and the Thurston Homeless Services Advisory Board. Your GA Director has debated with his fellow TAHAB members the merits and negative impacts around “rent stabilization.” When the list of priorities was first presented to our advisory committee, rent stabilization was the #1 priority of the RHC. After much debate, and the inclusion of multiple statistical and economic studies by myself, the TAHAB voted to recommend to the RHC that rent stabilization was misguided and should not be a priority. The result was that rent stabilization was moved down the list. After the meeting on the 13th, the approved list was released, and you will see that they ignored the advisory board and went with the following priorities:

  1. Pass legislation to prevent unfair and extreme rent increases.

According to a 2020 report by the U.S. Government Accountability Office, every $100 increase in median rent is associated with a 9% increase in the estimated homelessness rate. About 55% of all Thurston County renters spend over 30% of their income on housing costs and 75% of extremely low-income renter households spend over half of their income on housing costs. In 2024, working at minimum wage of $16.28/hour, you would have to work 83 hours each week to afford a modest 1-bedroom rental home at Fair Market Rent. Thurston Regional Housing Council recommends that the Legislature enact reasonable rent stabilization measures to address rising housing costs.

  1. Provide long-term operational funds for programs established and paid for by the Governor’s Rights of Way Initiative.

In Thurston County, Rights of Way Initiative funds have supported operations at an existing continuous stay shelter, a new enhanced shelter, a tiny home village, and hoteling and rent assistance for those fleeing domestic violence and for families. Current funding is only secured through June 30, 2025. Securing operational funding after this date is critical to ensure that residents of temporary housing are not displaced when funding ends. Thurston Regional Housing Council recommends that the Legislature identify long-term funding to continue Rights of Way-supported projects.

  1. Provide funding for South Puget Sound Habitat for Humanity’s 3900 Boulevard Project located in Thurston County.

South Puget Sound Habitat for Humanity (Habitat) is working to develop ten acres formerly owned by the City of Olympia into approximately 112 owner-occupied townhomes and cottages. These homes will be affordable to households making 30-80% of the area median income. The project will also include a small neighborhood center. The homes will be constructed in phases and designated as affordable in perpetuity. Over 50% of the homes will be ADA accessible, and all units will be built to the Evergreen Sustainable Development Standard.

Habitat is currently seeking financing for infrastructure improvements supporting all 112 units. The associated cost is $23 million, of which approximately $14.5 million is already secured through expected home sales and grant awards. Habitat submitted a 2024 Housing Trust Fund proposal requesting $4 million and plans to pursue a 2025 congressional appropriation of up to $5 million, if necessary. Phase 1 of the project includes the infrastructure improvements to begin in summer 2025 and construction of 36 homes in spring 2026.

  1. Increase capital funding through the Housing Trust Fund for the development and preservation of affordable housing.

There is a substantial need and demand for affordable housing in Thurston County. Under the analysis of affordable housing needs developed under HB 1220-Housing Amendments to the Growth Management Act, Thurston County needs to develop over 54,000 units of net new housing between 2020-2045. This affordable housing will not be created by the private sector on its own. Thurston Regional Housing Council recommends that the Legislature identify substantial and sustainable state resources to develop significant number of new affordable housing units, including creating a dedicated source for the Housing Trust Fund.

Additional area of interest

The Thurston Regional Housing Council (RHC) recognizes that the presence of mold and moisture in housing causes negative health and economic impacts, particularly for low-income and vulnerable renter households. As a result, households with people who identify as Black, Indigenous and Persons of Color (BIPOC) as well as low-income households, children and medically vulnerable persons are disproportionately impacted by mold in housing. The RHC calls on the state legislature to take action to explore practical options for increasing protections for households impacted by conditions of mold and moisture in housing.

Lewis County Fee Increases – FYI, we were informed at the Lewis County meeting earlier this year that the county was in dire need of revenue and could possibly double their fees. This is coming to fruition on January 1. Your GA director submitted a letter to the county laying out the potential negative impacts on the housing markets. Our members suggested, at the time, that they understood the need to raise some fees and that the county did not raise fees since 2017. So, relatively, Lewis County is in line with much of the state. In fact, they remain a lower cost place to build than Thurston. Your GA Director is working with the county on efficiency processes that may help mitigate these costs.

Tumwater Committees Recommend to Council Permitting Efficiency Measures – Tumwater’s General Government Committee met on Wednesday, November 13th, and discussed amendments to Title 14 of the Tumwater Municipal Code. Title 14 contains the rules, codes, and policies in the Tumwater Development Code. Development staff spoke about the need to create efficiencies around recommendations from the industry (OMB) and due to SB 5290. Some of the changes discussed would be to the timelines for permitting, and some expansion of the Multi-Family Tax Exemption. On permitting timelines, the committee recommends being more explicit in the city code and ensuring that developers/builders understand the characterization “procedurally complete.” On the MFTE, the committee recommended administrative approval by the development manager themselves as a common practice going forward (OMB supported this measure, but council has pushed back). Finally, the GGC also recommended more flexibility for staff to interpret the land use code and find better ways to get to yes.

City of Olympia Climate Chapter Project – Talks are beginning around Olympia’s climate chapter of their comp plan. Your GA Director is a stakeholder and having preliminary meetings with staff this week. Look to future reports for further updates.

Ongoing Topics:

Tumwater 2025-26 Biennium Budget Proposal – On Tuesday, October 22nd, staff presented their proposal to city council. The proposal would put Tumwater at a deficit of $10 million. Much of this is new costs associated with an equity commission, sensory recovery spaces in parks, restoration of brewery tower, Morningside clients working at city hall, and a place to drop off paint. Other major changes that require funding include body-worn cameras for police and the city’s share of the obligations for a new Medic One unit. To bridge the gap, the city is proposing to defer maintenance and the hiring of multiple new positions. A significant item to be aware of is the fact that this proposal does not include the city’s share of funding for the Deschutes Estuary project. OMB staff will continue to monitor for impacts to our industry and the potential for increased fees and other items that typically affect our members.

Olympia’s Transportation Master Plan – Discussions are underway, and the Olympia Planning Commission took a deep dive into the city’s transportation network proposals. Though not directly related to the homebuilding industry, many of the plans will greatly impact when, where, and how many projects get built in the city going forward. The focus of the discussion at the October 22nd meeting of the planning commission was on “complete streets” and a robust biking network. The idea behind “complete streets” is that streets should be designed with people, and not just cars, in mind. For example, required trees, expanded bicycle lanes, sidewalks, and lane reductions. Couple with the reduction in parking requirements, the city is utilizing its plans to move away from a car-centric approach to urban planning. It is yet to be seen, but one could imagine these changes having both positive and negative impacts on our industry. As an aside, the idea of e-bikes and an e-bike charging network was also discussed. Public comment has yet to begin, as this issue is still in the discussion phase, but OMB staff will continue to monitor for an opportunity to participate in the discussion.

The Switch Is On – (Heat Pump Rebates!) The City of Olympia, and several others, are joining “The Switch Is On” campaign. This means savings through incentives and rebates on heat pumps for homeowners and contractors. For example, jurisdictions may offer rebates on heat pump technology for our home appliances including HVAC systems and dryers. The City of Olympia is asking for help from our members by signing up for this program and connecting clients with these incentives and rebates.

To sign up/explore options you may be able to provide go to https://www.switchison.org/wa

Comprehensive Plans – In case you haven’t heard it enough already, please be sure to provide input on comprehensive plans throughout the jurisdictions you conduct business or live in. It cannot be stressed enough that this is your opportunity to tell the cities and counties across the South Sound that redundant and unnecessary regulations and restrictions are driving up the cost of housing. You do business in this industry. You are the expert. You know what is helping/hurting your ability to do business in your community. Now is the time for you to provide input and direction for the local housing economy.

WHY THIS MATTERS TO YOU – Comprehensive Planning at jurisdictions will impact your ability to do business and build housing for the next 20 years. They include policy around economy, land use, zoning, housing and more. The overarching goal of the comprehensive plan is to place local control over local priorities. Make time to be part of the “locals” that are giving input! These plans are only available to update and edit every 10 years, and now is your time to determine what you want your community to look like shifting toward 2045, and to ensure that affordable housing for all economic segments of society is a priority!

 

You can search your local jurisdiction online, but we’ve also provided some of the major ones below:

 

Thurston County: Thurston 2045

Mason County: Mason County 2025 Comprehensive Plan Update

Lewis County: Lewis County 2045

City of Olympia: Engage Olympia

City of Lacey: Lacey Comprehensive Planning

City of Tumwater: Tumwater Comprehensive Plan

City of Centralia: Centralia Comprehensive Plan Update

 

Olympia Fee Increases – As the City of Olympia works to balance their 2025-26 biennium budget proposal, our members should be aware that impact fees are on the table. Olympia City officials have proposed increasing utility rates, permit, and impact fees as part of the 2025 budget, aimed at supporting critical infrastructure and other municipal services.  For 2025, the proposed changes include a 4% overall increase in permit fees to account for labor costs. “This 4% increase, we believe, gives a buffer. Not only does it help match the 76% cost recovery, but it also provides a buffer for any changes from the classification and compensation study. So, we believe the 4% increase is a reasonable and appropriate adjustment,” the city’s finance director has stated. OMB staff sent out updates previously on the potential for these increases, and the general feeling was that these were acceptable increases to cover increased costs and potential staffing and operations of the permit center. However, don’t feel the need to agree. We will field and relay all concerns on this that you may have to city staff.