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RES 20-780 - Authorizing Transfer of Funds to SKHHP RESOLUTION NO. 20-780 A RESOLUTION of the City of Federal Way,Washington,authorizing the Mayor to transfer funds collected under the provisions of RCW 82.14.540 and City of Federal Way Ordinance 19-879 to the South King Housing and Homelessness Partners. WHEREAS,the 2019 State Legislature approved, and the Governor signed,the Laws of 2019, Chapter 338 (Substitute House Bill 1406), which allows cities and counties to recapture a portion of Washington State sales tax when it is used to support affordable housing initiatives;and WHEREAS, on November 5,2019, the Federal Way City Council passed Ordinance 19- 879, which authorized a recapture of Washington State sales tax that is estimated to generate approximately$125,000 per year for the next 20 years; and WHEREAS,on February 19,2019,the Federal Way City Council authorized the Mayor to enter into an Interlocal Agreement with eight other south King County cities and King County to form the South King Housing and Homelessness Partners (SKHHP); and WHEREAS, the executed Interlocal Agreement states that "the Parties have determined that the most efficient and expeditious way for the Parties to address affordable housing needs in South King county is through cooperative action and pooling public and private resources;" and WHEREAS, all ten jurisdictions of SKHHP have taken action to enact the sales tax recapture provisions established in RCW 82.14.540; and WHEREAS,on November 22,2019 the SKHHP Executive Board took unanimous action to adopt SKHHP Resolution 2019-06, attached as Exhibit A, which urges each of the member cities and King County to pool 100% of the funds collected under the provisions of HB 1406 (RCW 82.14.540); and Resolution No. 20-780 Page I of 8 WHEREAS, if all nine cities pool the maximum extent of collected funds under RCW 82.14.540 to SKHHP,the estimated revenue would total approximately$1,000,000 per year for a 20-year period; and WHEREAS,funds may be used for the purpose of acquiring,rehabilitating,or constructing affordable housing; funding the operations and maintenance costs of new units of affordable or supportive housing; and WHEREAS, cities that have a population of less than 100,000 may also use the funds for providing rental assistance to tenants, however, using the funds in this manner will require substantial administrative oversight with respect to preparing a program that requires city staff to review personal income information of individuals who request access to funds and accounting and auditing the use of the funds; and WHEREAS,the City of Federal Way is projected to exceed a population of 100,000 within the 20-year window set forth in RCW 82.14.540, which will prohibit Federal Way from using funds for the purpose of providing rental assistance; and WHEREAS, counties and cities that enact the provisions RCW 82.14.540 may issue general obligation or revenue bonds, and may use moneys collected for the repayment of bonds; and WHEREAS, RCW 82.14.540 requires counties and cities that enact its provisions to provide annual reports to the Department of Commerce. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF FEDERAL WAY, RESOLVES AS FOLLOWS: Section 1. Findings. The administrative costs associated with managing a program that Resolution No. 20-780 Page 2 of 8 provides rental assistance to tenants combined with the annual reporting requirements established in Laws of 2019, Chapter 338 are likely to exceed Federal Way's estimated revenue collection. While $125,000 is a valuable revenue stream that can be used in Federal Way to support various affordable housing initiatives, a contribution to SKHHP will allow the use of funds to stretch much further and to make a far more profound and meaningful impact to addressing the affordable housing challenges faced in South King County. Section 2.The Mayor is authorized to take administrative actions necessary to direct funds collected under RCW 82.14.540 and City of Federal Way Ordinance 19-879 to SKHHP. Section 3. This authorization is contingent upon each of the other SKHHP cities taking similar actions directing funds collected under RCW 82.14.540 to SKHHP. Section 4. Severability. If any section,sentence,clause or phrase of this resolution should be held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other section, sentence, clause, or phrase of this resolution. Section 5. Corrections. The City Clerk and codifiers of this resolution are authorized to make necessary corrections to this resolution including, but not limited to, the correction of scrivener/clerical errors, references, resolution numbering, section/subsection numbers and any references thereto. Section 6.Ratification.Any act consistent with the authority and prior to the effective date of this resolution is hereby ratified and affirmed. Section 7.Effective Date. This resolution shall be effective immediately upon passage by the Federal Way City Council. Resolution No. 20-780 Page 3 of 8 RESOLVED BY THE CITY COUNCIL OF THE CITY OF FEDERAL WAY, WASHINGTON this 18th day of February, 2020. CITY OF FEDERAL WAY: JIM FE LL, MAYOR ATTEST: �mm U EPHANIE COURTNE MC, CITY CLERK APPROVED AS TO FORM: r. J. RYAN CALL, CITY ATTORNEY FILED WITH THE CITY CLERK: 02/12/2020 PASSED BY THE CITY COUNCIL: 02/18/2020 RESOLUTION NO.: 20-780 Resolution No. 20-780 Page 4 of 8 EXHIBIT A RESOLUTION NO.2019-06 A RESOLUTION OF THE EXECUTIVE BOARD OF THE SOUTH KING COUNTY HOUSING AND HOMELESSNESS PARTNERS URGING SKHHP MEMBER CITIES TO SUPPORT POOLING OF HB 1406 FUNDS. WHEREAS,in 2019 the cities of Auburn, Burien, Covington , Des Moines, Federal Way, Kent, Normandy Park, Renton, and Tukwila and King County entered into an Interlocal Agreement(ILA)that formed the South King Housing and Homelessness Partners (SKHHP); and WHEREAS, pursuant to the ILA, the member cities have a common goal to ensure availability of housing that meets the needs of all income levels in South King County; and WHEREAS, also pursuant to the ILA, the member cities wish to act cooperatively to formulate housing policies and strategies that address housing stability,to foster efforts to preserve and provide affordable housing by combining public funding with private- sector resources, to support implementation of the Washington State GMA, related countywide planning policies, and other local policies and program relating to affordable housing, and to do so efficiently and expeditiously; and WHEREAS, also pursuant to the ILA, the member cities have determined that the most efficient and expeditious way for the parties to address affordable housing needs in South King County is through cooperative action and pooling of public and private resources; and Resolution No. 20-780 Page 5 of 8 WHEREAS, the ILA states that the parties intend that the ILA serves as a framework for all participating municipalities within the broader SKHHP Sphere of Influence to do the aforementioned work; and WHEREAS, on July 26, 2019 the SKHHP Executive Board adopted Resolution 2019-05 which urges member cities to declare their intent to enact the provisions of HS 1406; and WHEREAS, Resolution 2019-05 states that the Executive Board commits to developing options and a recommendation,including forthe proposed pooling of funding,that details funding commitments for each member city's legislative authority to consider for future subsequent action; and WHEREAS, HB 1406 is a powerful and meaningful funding source to further advance the efforts of the housing objectives established through the ILA that, if pooled, will generate approximately $1,000,000 per year for the eligible 20 year period (See Attachment A);and WHEREAS, the Executive Board adopts the recommendations contained within this resolution as a unified statement of support by SKHHP member cities. NOW, THEREFORE, THE EXECUTIVE BOARD RESOLVES as follows: Section 1. The Executive Board of SKHHP urges all member cities to pool the base sales tax credit revenues collected under HB 1406 and to allocate the full amount of those revenues to SKHHP. Section 2. In order to maximize HB 1406 funding within King County,the Executive Board of SKHHP urges all member cities to take Ordinance action on HB 1406 after King County takes action. Resolution No. 20-780 Page 6 of 8 Section 3. The Executive Board of SKHHP urges King County to award HB 1406 funds to housing development based in the Urban Growth Areas(UGA) ofSKHHP member cities in a manner that proportionately represents the cumulative population of the UGA's of SKHHP member cities. Section 4. The Executive Board of SKHHP commits to aligning the use of HB 1406 funds with the work plan required within the adopted ILA and the recommendation and priorities of the Regional Affordable Housing Task Force Five Year Action Plan. Section 5. Individual municipalities have unit}ue housing needs andpriorities and not every protect pr000sal will align with a city's goals, policies. or laws. Tile intent and effect of this resolution is not to usurb a city's individual authority Therefore, if funds are pooled for the Dtlrpose of aiding in the creation or preservation of housing.the process for pro ect consideration must allow the city in which the project is proposed to first approve or reject the proposal prior to the Executive Board's_commitment of funds to the ion iect- Section 6. This Resolution will take effect and be in full force on passage and signature. Dated and Signed this 2►° day of2019. SOUTH KING COUNTY HOUSING AND HOMELESSNESS PARTNERS A GY� ":ALJ•~�. CHAI Shawn Campbell, Auburn ity Clerk Resolution No. 20-780 Page 7 of 8 SKHHP Resolution 2019-06 Attachment A Estimated HB 1406 Revenue by SKHHP Municipality (based on 2018 revenues) I: City - EMirnated AnnuaI Revenue Auburn $154.992 r Burien —1 $65,477 Covington 1 S43,678 Des Moines $29,793 Federal Way_____ $124,142 Kent $185.467 Normandy Park $4.866 Renton $236,380 Tukwila $162,046 Totalud not inci � --- ------ ing King County} ' $19006,841.00 Resolution No. 20-780 Page 8 of 8