(The Center Square) – Gov. Bob Ferguson has announced a spending proposal of $244 million to be included in the 2026 supplemental operating budget with much of it going to build subsidizes rental units and create a new state office tasked with making housing more affordable.
The announcement comes at a time when residential construction permit rates are down to lowest levels since 2013, more than 80% of Washington households cannot afford a single family home and the state faces a multibillion budget shortfall.
Speaking at a Dec. 18 press conference inside Beacon Pacific Village’s ICHS PACE Clinic, Ferguson said “the simple fact is, we need more housing. This is a crisis that’s not going to be solved in a day or a week or a month or a year, right? It’s not that kind of a deal, but we’ve been making progress.”
Out of the $244 million, $81 million will be spent on building 2,000 subsidized rental units, while $73 million will provide funding for first-time home buyers.
The state Department of Commerce has estimated the state will require 1.1 million more residential units over the next two decades.
Ferguson also called for the creation of a Department of Housing, arguing that the housing crisis requires dedicated staff at the state level.
Lieutenant Governor Denny Heck also spoke at the press conference, stating that “the solution is fairly obvious, harder to implement, but fairly obvious. We need to build more homes of all kinds for all our neighbors, especially affordable homes. People with lower incomes are being double hit by the cost of housing and all the other affordability issues that are stressing them.”
Heck’s office recently released a report titled “Commercial to Residential,” which makes the case for converting former commercial units into housing.
“Our study and conversations reveal that Washington’s cities, developers and engineers agree that this is a high-value, high-impact opportunity in many communities while increasing public revenue and avoiding some tougher tradeoffs on greenspace or existing homes,” the report states.
At the press conference, Sen. Emily Alvarado, D-Seattle, called for legislation that would amend existing zoning laws to legally permit more housing construction.
“There is underused land within urban growth areas where housing is compatible, but right now it’s not allowed to be built in commercial zones and in mixed use zones,” she said. “These are places where we’re already planning for future urban development. There are tens of thousands of parcels where housing is prohibited and where real barriers exist that make development infeasible.”
The Housing Development Consortium Executive represents 220 organizations involved in designing, financing, building and operating affordable housing. Executive Director Patience Malaba noted at the press conference that they have had their largest housing production between now and 2021 due to funding from the state and corporations like Amazon and Microsoft. According to Malaba, the state spent $605 million last year on subsidized housing.
Acknowledging the state’s ongoing fiscal crisis, Ferguson said the $244 million will come primarily through the state’s capital budget using state-issued bonds, while small, unspecified amounts will originate from the Climate Commitment Act and the operating budget.
