||| FROM SAN JUAN COUNTY COMMUNICATIONS |||
The San Juan County Council unanimously voted to approve an ordinance to adopt a new 1/10th of 1% sales and use tax for affordable housing and related services. This vote followed a public hearing at their October 3, 2023 meeting. The tax is enabled by RCW 82.14.530 and will go into effect on January 1, 2024.
San Juan County joins nearly 20 other jurisdictions in Washington to adopt this funding source including Skagit County, Whatcom County, the City of Anacortes, and others. The proceeds will be used exclusively for constructing or acquiring affordable housing, funding the operations and maintenance costs of affordable housing projects, and housing related services for eligible population groups.
The adoption of the tax this week is the culmination of multiple years of deliberations by the Council and advocacy by local housing advocates and non-profits. Affordable housing challenges continue to affect our local community. San Juan County remains the least affordable County for housing in the State according to the Washington State Center for Real Estate Research.
This source of funds will be used to subsidize construction costs for eligible housing projects, which in turn can leverage additional State, Federal, and private philanthropic dollars (which typically require local matching funds). Current estimates are that five times the amount of funds raised through this tax will be brought in by other funding sources for affordable housing construction and acquisition.
Additionally, the funds can be used to support our local Community Resource Centers on each island with staff capacity to provide housing support services for housing insecure islanders. The adoption of this funding source also addresses multiple strategies and goals identified in the County’s adopted Five-Year Homeless Plan.
The tax increase amounts to an additional $1 on every $1,000 of qualifying taxable sales. The cost to the average citizen is estimated to be about $20 per year, while raising an estimated $800,000 a year for affordable housing and related services.
The new funds will be incorporated into the County’s existing Home Fund program. To date, the Home Fund has contributed to the construction or preservation of 101 affordable housing units in the County, with another 31 units currently in development. To learn more about the County’s Home Fund, please visit sjchomefund.com
Relevant URLs:
- SJC Home Fund
- SJC A RESOLUTION ADOPTING A PLAN FOR THE EXPENDITURE OF PROCEEDS OF A ONE-HALF OF ONE PERCENT REAL ESTATE EXCISE TAX AND A ONE-TENTH OF ONE PERCENT SALES TAX FOR AFFORDABLE HOUSING
- Washington State Center for Real Estate Research
- Five-Year Homeless Plan
About San Juan County’s Department of Health and Community Services
San Juan County’s Department of Health and Community Services is responsible for community and environmental health, mental health and substance abuse programs, senior services, affordable housing projects, and more. The department has staff and offices on Lopez, Orcas, and San Juan Islands. For more information about San Juan County’s Department of Health and Community Services, visit www.sanjuanco.com/1777/Health-Community-Services.
Thank you to the Council for passing this tool to provide funding for essential housing support. Every bit of funding helps to ensure our Resource Centers can provided the assistance needed to keep folks in homes and help those who need to build a bridge towards housing.
When there has to be a citizen uprising to halt construction of a MULTI-MILLION DOLLAR “fish culvert to nowhere” it kind of puts the current county government’s actual commitment to affordable housing in perspective…
Thank you Cindy! Thank you council!
Hmmm… The “do the math” part of me is confused.
$800K raised as a 0.1% sales tax means $800M in taxable revenue from the county.
Some of that is from tourism, of course, bu on the flip side, many households aren’t full time residents. I’m making the simplifying assumption that they roughly balance… $800M raised from 8,000 household (latest census estimate) is about $100K per household annually, of transactions subject to sales tax. Given that rent isn’t taxable, nor are house purchases, the implication seems to be that the average household has $100K of post-tax/post-housing income to spend on local purchases (services, groceries, etc.). Seems kinda high to me — or, if I take those numbers at face value, the average household — using the fairly conservative metric of spending no more than 25% of post-tax income on housing — should be able to afford about $30K/year on housing (about $2500/month). or a mortgage of around $500K (counting interest deductions).
Is my math correct?
(for the record, I’m a proponent of affordable housing, but the revenue projection seems high to me)
Ken, I suspect the accounting includes the taxes paid on money spent by non residents- both visitors and second home owners. We are definitely a tourist economy.
Hmmm… Ouch. That just seems bizarre to me, since sales tax increases burden the poor and working poor more than any other income group. Was there no other way to raise this money in a county with one of the widest gaps of income disparity? Justifying every sales tax increase with arguments that it’s “only 1/10th of one percent” doesn’t take into account what San Juan County (and WA in general, having no income tax- which would be more tailored to income) has one of the highest sales tax rates in the state.
https://www.bloomberg.com/news/articles/2015-01-20/how-local-sales-taxes-target-the-poor-and-widen-the-income-gap
Thanks for that comment, Sadie
Sadie, I tend to agree with your assertion.
Taxes across the board are a challenge to monitor and engage.
Like our Land Bank we all enjoy the harvest but it gets reshuffled to others.. which hence creates more burden on those left paying the ever increasing percentages.
Like Conservation, it comes with a price. Hopefully we all utilize these great treasures.
That said, meaningful movement to move the needle towards the Service Class is paramount to maintaining a balanced economy for Orcas Peps.
Sadie, it’s true that a sales tax is inherently unbalanced and regressive. However, in this case, and in view of our Islands’ greatly unbalanced class economy, I would argue that 1/10 on a cent on the dollar, spread over the entire population, to help provide housing for those who can’t afford it, is a fair burden and a good benefit.