(The Center Square) – Members of the Washington State House of Representatives spent nearly four hours Thursday night debating Second Substitute House Bill 1696, which would dramatically expand the pool of those who could qualify for the state’s Covenant Home Ownership Program, before finally passing it.
The Covenant Home Ownership program offers home buying assistance to minorities who have faced housing discrimination in the past. The program is open to those who lived in or had a parent, grandparent or great-grandparent living in Washington before 1968 and who meet one of the following government-defined racial identities: “Black, Hispanic, Native American, Alaska Native, Native Hawaiian or other Pacific Islander, Korean and Asian Indian.”
Launched on July 1, 2024, the program allows qualified homebuyers to apply through their lenders for zero-interest loans to help fund down payments and closing costs. The loans are funded by fees on real estate documents recorded with the state.
SSHB 1996 would increase the income threshold for applicants to 140% of the area median income and allow for loans to be full forgiven after five years of repayment.
It would also change one of the oversight committee membership positions to include a representative from a nonprofit organization that provides housing counseling, replacing the previous requirement for a community-based organization specializing in affordable housing development.
During Thursday night’s floor debate, House Republicans offered 15 amendments, all of which were rejected by majority party Democrats.
“People in Washington are tired of taxes, and it’s the people in Washington who are ultimately paying for this program … and now when the state is facing a $10 or $15 billion deficit, now we’re looking to give more money away that we don’t even have?” Rep. Sam Low, R-Lake Stevens, asked.
Low offered an amendment to delay the effective date for raising the area median income threshold and authorizing loan forgiveness to July 1, 2035.
Rep. Travis Couture, R-Allyn, agreed on the bill’s bad timing.
“We’re promoting a loan forgiveness program that is going to give money away, and at the same time, it could subject people to an enormous tax liability that could crush them forever,” he said.
He was referring to IRS rules about loan forgiveness that could require participants to pay income taxes on the forgiven loan.
Rep. Dan Griffey, R-Allyn, offered an amendment that would exclude those who have been convicted of sex crimes from participating in the program.
“It might break your heart as well, Madame Speaker [Laurie Jinkins], to think that somebody that raped or abused a child or raped or abused a woman, would have preferential treatment over those who survived sexual violence,” he explained.
Griffey brought up his wife’s own trauma with sexual abuse.
“I think if it comes down to choosing one or the other, let’s choose the survivor and not the monster that did it to them,” he said.
Rep. Lillian Ortiz-Self, D-Mukilteo, spoke against Griffey’s amendment.
“Putting this into this bill as if that group of people had a higher propensity to create sexual abuse than anybody else, doesn’t seem logical,” Ortiz-Self said.
Couture rose in support of Griffey’s amendment.
“I’m standing in solidarity with my seatmate,” he said. “I think it’s impugning to try to question the motives of anyone on my side.”
Jinkins reminded Couture to confine his remarks to the legislation.
“It is an affront to me that we would accept forgiving a loan, gifting public funds … to somebody who has committed the worst of the worst crimes,” Couture continued.
Several Democrats ultimately supported the suggested revision, along with every Republican, but it failed.
Rep. Debra Entenman, D-Covington, said the bill is about righting the wrongs of the past.
“Until we are able to come to grips with white supremacy and racism, we will have a difficult time understanding that there are things we can do in policy to harm people and things we can do in policy to help people,” she said.
As the evening dragged on, more amendments were passionately debated – and rejected.
Rep. Deb Manjarrez, R-Wapato, spoke in support of an amendment to ensure that program participants make 80% of the average median income or less, noting, “80% AMI is what we use for all of our other programs and that’s what should still be used today.”
Rep. Andrew Barkis, R-Olympia, remarked on the Covenant Home Ownership Program’s finances.
“This program is already overprescribed; there’s no money,” he said, urging the adoption of the 80% AMI amendment.
Rep. April Connors, R-Kennewick, said that funds for the eight-month-old program have already run dry with $34 million paid out in loans.
House members also considered a modification that would delay a vote on the bill to allow the state Attorney General’s Office to weigh in on the constitutionality of the Covenant Home Ownership Program.
SSHB 1696 was passed along a party-line vote, with 57 Democrats in favor and 39 Republicans opposed.
The bill now goes to the Senate for consideration.
