RES 20-797 - Authorizing Transfer of Funds to SKHHP RESOLUTION NO. 20-797
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 j urisdictions 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
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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 hinds 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 the 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,on February 18,2020,the Federal Way City Council adopted Resolution 20-780
that directed the transfer of funds collected pursuant to RCW 82.14.540 to SKHHP if all other
member cities take similar action to direct a portion of their collected funds to SKHHP; and
WHEREAS, in response to the coronavirus pandemic, some SKHHP member cities have
directed funds to rental assistance,which prevents the City of Federal Way from directing its funds
received pursuant to RCW 82.14.540 to SKHHP due to the restriction of Resolution 20-780; and
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WHEREAS,it remains the City of Federal Way's desire to appropriate and expend the funds
allocated to the City under RCW 82.14.540 to SKHHP for use on capital projects that address
housing affordability.
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
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. As long as the City of Federal Way remains a member of SKHHP,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 two or more SKHHP cities taking similar
actions directing funds collected under RCW 82.14.540 to SKHHP and entering into an interlocal
agreement, consistent with the Interlocal Cooperation Act, to pool tax receipts received to the
SKHHP Housing Capital Fund.
5cctioii4.5e crabi1i[y.Ifanysection,sentence,clause or phrase of this resolution should be
held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or
Resolution No. 20-797 Page 3 of 5
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 the 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.
RESOLVED BY THE CITY COUNCIL OF THE CITY OF FEDERAL WAY,
WASHINGTON this 20th day of October, 2020.
[signatures to follow]
Resolution No. 20-797 Page 4 of 5
CITY OF FEDERAL WAY:
JI RRE L, MAYOR
ATTEST:
-q��- NW4�e6
S AMIE COURTNEY, tj
, CITY CLERK
APPROVED AS TO FORM:
ap'C'Q-�
J. RYAN CALL, CITY ATTORNEY
FILED WITH THE CITY CLERK: 10/14/2020
PASSED BY THE CITY COUNCIL: 10/20/2020
RESOLUTION NO.: 20-797
Resolution No. 20-797 Page 5 of 5