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Pierce County’s six-year sales tax plan funds housing in small portion of Tacoma

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(The Center Square) – A draft six-year expenditure plan with Pierce County’s new housing and related services sales tax would take tax dollars from outside Tacoma and use them for recommended affordable housing projects in Tacoma.

The Pierce County Council passed an ordinance known as the Maureen Howard Affordable Housing Act, which took effect on April 7. The ordinance is also known as the 1590 program.

The ordinance levies an additional sales and use tax of one-tenth of 1% for housing and related services. This comes as statistics show over 100,000 Pierce County households are housing cost-burdened and pay over 30% of their income for housing costs.

The Housing Action Strategy identified that approximately 2,300 new units of affordable housing need to be constructed annually over the next 20 years to meet demand. For context, the county partially funded 219 new units of affordable housing that have been placed in service in the last five years.

In a presentation to the Pierce County Health and Human Services Committee, the county’s human services department states that “1590 funds should be used to close the gap between current affordable housing production and affordable housing needs identified in the Housing Action Strategy.”

According to the six-year expenditure plan, the sales tax is expected to generate $17.8 million in 2024 and gradually increase to $23.3 million in 2029.

Pierce County Councilmember Marty Campbell noted that all the tax dollars from the Maureen Howard Affordable Housing Act come outside of the City of Tacoma as the city has its own sales tax for affordable housing, while all four projects the department is recommending spending on are in a four-mile radius within Tacoma.

Bryan Schmid, social services supervisor at the Human Services Department, responded that the county did initially allocate funds towards the Copper Way project, which is an affordable housing development in Spanaway with 256 units of housing.

Schmid explained that the four projects applied for funds back in June and were waitlisted.

“These are projects that when we put out a [notice of funding availability], that was the response that we got was for development of these projects,” Schmid said in the committee meeting on Dec. 5.

The four projects in Tacoma would be allocated $10.2 million to create 275 units of affordable housing, according to the presentation.

“It’s difficult to go out and say we’re doing a lot for affordable housing in unincorporated Pierce County when we got $10 million going into a small geographic area,” Campbell said. “Not only is it in Tacoma, it’s in a really small area of Tacoma, and the optics of this just are not good.”

The plan intends to use 80% of the 1590 program funds ($98.2 million) on the capital development and preservation of affordable housing and the operations and maintenance of newly created affordable housing.

The remaining 20% of the 1590 program funds ($24.5 million) for the delivery of housing services to support the homeless crisis response system.

The county’s current funding to support existing permanent supportive housing is $6.5 million to support 529 units of permanent supportive housing.

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