New growth management grants help Washington communities design a future with housing choices affordable to all income levels

Funding for housing action plans and transit-oriented development helps communities address years of underbuilding that left middle and lower-income residents priced out of housing as state’s population boomed.

||| FROM STATE COMMERCE DEPARTMENT |||

A 2020 report tagged Washington state with one of the 10 worst housing shortages in the nation, underbuilding by over a quarter of a million homes over the prior 15 years. Harvard University’s Joint Center for Housing Studies documented the nationwide housing shortage and potential economic impacts in its 2019 State of the Nation’s Housing.

In Washington state, residential construction remained flat, while our population ballooned by over 1 million people since 2010.

As Washington’s economy boomed, many middle and lower-income people could no longer afford to live in or near the communities where they work. Rising rents are a primary contributor to homelessness and soaring prices have put single-family homes out of reach for many potential homebuyers. In addition, communities today suffer from a so-called “missing middle” — the lack of more diverse options such as duplexes, fourplexes, cottage courts and courtyard buildings that can be more affordable.

To help communities grapple with this growing challenge, the Department of Commerce recently awarded $5.9 million in funding through two new growth management grant programs. Funding will support zoning changes to allow more housing and a greater variety of housing types, and help cities encourage developers to build smaller and more affordable housing.

The Legislature provided the funding for the new grant programs. The programs were designed to encourage cities to prioritize creation of affordable, inclusive neighborhoods, especially in areas with frequent transit service and other infrastructure that can support increased residential capacity.

Housing Action Plan Implementation grants: $3.5 million to 44 communities

The Housing Action Plan and Implementation (HAPI) grant provides funding for cities to develop strategies to meet their housing needs. Commerce awarded $3.5 million to 44 communities to research their housing needs, engage the community in a public process and identity zoning changes or programs that would encourage private developers to build more housing to meet the needs of residents, including those who work in communities but can’t afford to live there. View the list of grant recipients.

Transit-Oriented Development and Implementation grants: $2.4 million to 11 cities

The Transit-Oriented Development and Implementation (TODI) grants provide funding to leverage investments in light rail and bus service. Commerce awarded $2.4 million to 11 cities to review zoning around transit stations and streamline permit processing times for more development in station areas. Transit-oriented development is an efficient way to absorb the state’s expanding population and build high-quality neighborhoods, while minimizing traffic and costly sprawl. View the list of grant recipients.

“Housing continues to be a challenge in every part of our state. Population growth and underbuilding have limited affordable housing options for working families,” said Commerce Director Lisa Brown. “The efforts supported by these grants will strengthen communities as they plan a future with vital, diverse neighborhoods offering good housing options for all.”

Washington state’s land use planning framework was recently changed to require cities to plan for the affordability of a specific number of homes (House Bill 1220). Communities planning under the Growth Management Act (GMA) must plan for construction of a variety of housing types so that everyone can afford a place to live in and near the communities where they work. A county-wide framework guides each community in planning to absorb their share of the county’s growth. Communities must also consider the effect of new development on existing residents and plan to reduce displacement when development occurs.

Commerce provides an easy-to-use portal with extensive housing planning resources. Many of the communities awarded HAPI and TODI grants will be building on housing plans adopted this year to meet growing needs they identified through research and community engagement.

Auburn engages public and private partners in housing action plan

Auburn’s Housing Action Plan includes dense, transit-oriented development, more affordable single-family housing options and preventing current residents from being displaced by rising rents or new development.

Auburn, which straddles north Pierce County and south King County, received grant funding from Commerce. The city will use the grant to encourage market rate development in its downtown, zoning for more affordable housing options in existing single family neighborhoods and preventing displacement of existing residents when rents increase, or when new development occurs. The city will also receive funding to leverage regional investments in transit at its RapidRide I Line transit station.

Auburn adopted a housing plan earlier this year, and plans to rely on dense, transit-oriented development adjacent to existing and planned high-capacity transit options in downtown.

Auburn is part of South King Housing and Homelessness Partnership (SKHHP). SKHHP was formed based on the underlying belief that improving access to affordable housing requires municipalities to look beyond their own boundaries and create regional programs and strategies. By pooling resources and working together, SKHHP partners will expand the housing options available to residents and take a strategic approach to ensuring affordable housing is available where it is most needed, provides the greatest benefit and makes the most effective use of public and private resources.

Regulatory streamlining, equity figure prominently in Spokane’s development plans

Commerce grants will help Spokane continue moving forward with key development priorities that have been informed by active partnerships and engagement with neighborhood councils.

Spokane is using grant funding to change regulations to allow new types of housing such as accessory dwellings, duplexes and triplexes in low-density neighborhoods as well as decrease the time it takes to get a building permit. Spokane’s Housing Action Plan also calls for zoning changes around the city’s first bus rapid transit line, the City Line, which will begin operation in 2022. The route will have 7.5-minute headways at peak times, and will range from 10 to 15-minutes at off-peak times.

The city plans to leverage investment in civic infrastructure, including bicycle and pedestrian trail improvements and development of a new hub for medical and health education, research and innovation in the University District. Plans also include a market analysis to help the city better understand overall development potential. It will include anti-displacement considerations and equitable transit-oriented development strategies to preserve and expand affordable housing, protect residents from rising costs, connect people to jobs and economic opportunities, and stabilize and support local businesses.

Lynnwood prioritizes removing barriers, promoting opportunities for all income levels

Lynnwood is uniquely positioned to handle additional growth through the redevelopment of aging strip malls and surface parking lots, incoming light rail stations and accessibility to regional job centers.

The city of Lynnwood is changing regulations to increase and diversify housing options, revising programs to encourage the development of affordable units, developing a rental registry program and continuing community conversations about housing. Grant funding will also help the city develop a plan to increase housing and streamline development at the Lynnwood City Center and West Alderwood stations.

“Commerce funding is crucial to this project,” city officials wrote in their grant application. Lynnwood’s Housing Action Plan process revealed that policies and regulations present significant barriers to achieving housing goals. The plan prioritized policy and code changes to remove obstacles to housing development and promote opportunities for all income levels.

The HAPI grant funds will help encourage a variety of housing types and price points throughout the city, which currently has a population of 41,000 and is projected to be approximately 65,000 by 2044. The city emphasized that Lynnwood is uniquely positioned to handle additional growth through redevelopment of aging strip malls and surface parking lots, incoming light rail stations and accessibility to regional job centers.

Oak Harbor shows rural communities must also tackle affordable housing challenges

With its population expected to grow to nearly 26,000 by 2036, Oak Harbor estimates it will need to add about 78 new housing units annually — that’s nearly double the current annual rate of residential construction.

Oak Harbor recognized that affordability is an increasing issue in the community, which is located well outside the metropolitan Puget Sound core. Nearly 40 percent of Oak Harbor households today pay more than 30 percent of their income toward housing, and 16 percent pay 50 percent or more. Oak Harbor will need housing for nearly 26,000 people by 2036, which means about 78 additional units are needed every year — that’s double the current rate of construction.

Their Housing Action Plan, adopted in June 2021 by unanimous consent of the city council, is taking steps to further encourage housing development by revising zoning standards, reducing building permit review times, and more. A robust, year-long effort led by the Island County/City of Oak Harbor Affordable Housing Task Force comprised of 28 government, developer, real estate and housing advocate members, identified 40 recommendations intended to stimulate affordable housing development, several of which carried forward into the city’s Housing Action Plan.

Housing that is accessible and affordable for all income levels is essential to strong, environmentally resilient, economically diverse communities. These are just a few examples of great work underway by local and regional partners throughout the state to plan for a vibrant, sustainable future.

Learn more about these grant programs on Commerce’s Growth Management website.

Washington State Department of Commerce official news and information. Our mission is to strengthen communities in our state.