— from Yes for Homes San Juan County Coalition —
Local housing activists are hailing the passage of a San Juan County ordinance meant to tackle the County’s growing affordable housing crisis.
On Tuesday, the San Juan County Council unanimously approved Ordinance 11-2018. The Ordinance authorizes the County to collect a one-half of one percent (0.5%) real estate excise tax (REET) on the sale of real property. The initiative was crafted after years of work by elected officials, community leaders, and small businesses across the County. The measure is not a property tax, reflecting the Coalition’s goal to avoid financial burden on homeowners with fixed incomes.
“This is an incredibly exciting moment,” said Mallory Hagel, a spokesperson for the Yes for Homes San Juan County coalition. “We’re proud that our County Council recognizes the need to keep vulnerable families in safe, affordable housing.”
The move comes after years of booming property values in the County. The median home value in San Juan County is now approaching $600,000, a figure that has increased 8.2% over the past year, according to real estate analysts at Zillow. With a tight rental market, local affordable housing experts are concerned about insufficient workforce housing. Populations especially at-risk for displacement include service industry workers, healthcare providers, educators, and those on fixed incomes.
“We’ve heard a lot from local businesses, from cafés to healthcare providers, that their employees are unable to find housing,” said Hagel of Yes for Homes San Juan County. “This isn’t just the right thing to do – it’s absolutely crucial for our economy, too.”
Now that the Council has approved the Ordinance, the next stop is the ballot. If approved by a majority of San Juan County voters, the measure will go toward the maintaining and constructing housing for those with very low, low, and moderate incomes. The measure is similar to plans previously passed in other Washington locales, including Bellingham, Seattle, and Vancouver, although organizers crafted the San Juan County measure to “reflect the County’s unique local needs and character.”
For the Yes for Homes coalition, a November vote means the next step is getting the word out. The Coalition is gathering volunteers, with campaign committees formed on Lopez, San Juan, and Orcas Islands. Right now, the campaign plans to focus on voter outreach and education.
Added Coalition spokesperson Hagel: “In a year sure to be full of partisan acrimony, it’s so good to know there will be something on the ballot that can make a meaningful difference for our San Juan neighbors. This is a really important, exciting opportunity for our community.”
For more information on the Yes for Homes San Juan County coalition, visit www.YesForHomes.net or email at: info@yesforhomes.net.
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Kudos to the Coalition and the County Council for continuing the forward momentum on this important measure. As with OPAL’s April’s Grove affordable rental community on Orcas, we are close to a breakthrough. Now let’s get ‘er done.
s
And kudos to Mallory! A young woman who has experienced firsthand the challenges of someone who wants to live, work and contribute her energy to our community’s vitality, but was unable to find even the most basic of housing. Her commitment – with all its authenticity – is compelling and persuasive.
And a BIG shout out to the San Juan County Council for their recognition of this most critical issue, and their support for this piece of the solution.
Now that’s ironic. A tax on property that’s supposed to “tackle the county’s growing affordable housing crisis,” yet increases the cost of a median-priced house by some $3,000 (.05% X 600,000). Brilliant!
Peter Bohr – FYI:
“A Real Estate Excise Tax (REET) is applied to the sale of real property. It is a one-time fee paid at the time of a real estate sale and NOT an ongoing property tax.”
https://yesforhomes.net/about/
Mike –
A real estate excise tax is a tax, not a fee. It is a tax that is applied every time real property changes hands. As you point out, the real estate excise tax is not a recurring tax that a property owner would pay each year.
Peter is correct that tax increases the cost [of purchasing] a median-priced house by $3,000. That does seem antithetical to the idea of generating affordable housing as the cost of real property is increased by this tax.
The website you link to is internally inconsistent: it calls this a tax and calls it a fee; they should select one term and stick with it.
I understand the argument for wanting affordable housing on the island – it’s not as if there are a lot of options available to reside in an inexpensive area and commute in to an expensive area for work. Hawaii is wrestling with this same issue at the moment.
If you run a business from your property you can increase your price to offset the 0.5% tax and people that purchase your product can pay for the tax – the tax raises costs for everyone that buys from your business. OK – so you can tax yourself and have the county redistribute the dollars to those that we (collectively) believe need the dollars more than we do. This approach fails when you don’t have a business which generates income from the ownership of real property – there’s no one to pass the cost along to and the tax falls directly on the property owner at the time of sale.
If you don’t like that model, imagine this model: the next buyer of your real property will have to raise costs to pay for the 0.5% tax that was incurred just to acquire the property. If there’s no one to pass costs along to, then the increased costs to purchase the real property now requires a person of even greater wealth just to make the purchase. That person of greater has increased the imbalance between median housing and ‘affordable’ housing.
It’s an issue, I’m not at all convinced that a tax on all real property transactions is a good way to go about having affordable housing exist on the island.
– rob iii
Mike,
I never stated that the REET is an annual property tax. But a Real Estate Excise Tax on the sale of real property is a property tax.
What you call it isn’t the important point. Rather, the notion of increasing the cost of the housing stock with a new tax is antithetical to making housing more affordable.
There are some 900 vacation rental permits in the islands for homes that might otherwise be put up for sale or rented long term to island residents. Would a bed tax dedicated to affordable housing and paid by tourists in vacation rentals not make more sense than a tax that makes housing less affordable?
Peter