wa-law.org > bill > 2025-26 > HB 1808 > Substitute Bill
The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
"Department" means the department of commerce.
"Eligible organizations" mean nonprofit developers building permanently affordable homeownership for sale to low-income households.
"Low-income household" means a single person, family, or unrelated persons living together whose adjusted income does not exceed 80 percent of the median family income adjusted for family size, for the county or the metropolitan area where the affordable housing is located, as reported by the United States department of housing and urban development, whichever is larger.
"Permanently affordable homeownership" means homeownership that, in addition to meeting the definition of "affordable housing" in RCW 43.185A.010, is:
Sponsored by a nonprofit organization or governmental entity and the sponsor organization:
Executes a new ground lease or deed restriction with a duration of at least 99 years at the initial sale and with each successive sale; and
Supports homeowners and enforces the ground lease or deed restriction; and
Subject to a ground lease or deed restriction that includes:
A resale restriction designed to provide affordability for future low-income and moderate-income homebuyers;
A right of first refusal for the sponsor organization to purchase the home at resale; and
A requirement that the sponsor organization must approve any refinancing, including home equity lines of credit.
"Program" means the affordable homeownership revolving loan fund program created under this chapter.
The program is created in the department to provide loans to eligible organizations to finance affordable homeownership construction for low-income households, subject to the availability of amounts appropriated for the specific purposes provided in this chapter.
The affordable homeownership revolving loan fund account is created in the state treasury. Revenues to the account shall consist of appropriations by the legislature, loan repayments, and all other sources deposited into the account. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used only for purposes of the program created in this chapter.
Under the program, the department may administer loans to eligible organizations to assist with the development of housing for low-income households subject to the following considerations:
Loans must be awarded to eligible organizations based on criteria established by the department, including at least the following:
Readiness to proceed with construction, including possession of necessary permits and completed land use entitlements;
Amount and commitment of capital being leveraged as part of the financing for the project, including public funding;
Proposed cost efficiency;
Development location, with the goal of awarding funding to projects in as many areas of the state as financially feasible and viable;
The applicant's qualifications and demonstrated capability to develop the proposed project; and
Any other criteria established by the department, provided that such criteria may not exceed the priority of any other criterion listed in this subsection (1).
Any housing financed under the program must serve low-income households for at least 99 years; however, the department, in consultation with program awardees, may establish a longer time period.
Loans awarded under this section may not exceed 50 percent of the total project costs of the housing to be developed. The department may exceed this maximum allowable loan amount for cause.
Loans awarded under this section may be used in combination with private sector loans or any other source of capital as recognized by the department.
The department must structure loans issued pursuant to this section with an interest rate above one percent, but not exceeding 2.5 percent. Repayment of loans administered under this section is due after all of the homes included in the financed project are sold, except as required by rules established by the department. All receipts from repayment of loans administered under this section must be deposited into the affordable homeownership revolving loan fund account created in section 3 of this act.
Upon receipt and repayment, any interest earnings and repaid loan funds must be tracked separately from other revenue and must be reloaned to qualifying applicants to finance additional permanently affordable homeownership under the program.
All loans issued pursuant to this section must be assumable under terms and conditions established by the department.
Loan recipients must:
Commit to beginning construction within 180 days of contracting the loan;
Adhere to the evergreen sustainable development standard adopted by the department;
File an annual compliance report containing information as specified by the department; and
Restrict use of awarded loan funding to eligible costs of housing as defined under RCW 43.180.020.
The department must:
Establish criteria and procedures for long-term monitoring of housing affordability and compliance under the program. The department may charge monitoring fees; and
Establish annual reporting requirements for loan recipients.
The department shall adopt policies necessary to administer the program established in this section and section 2 of this act.
No department general funds shall be expended to implement this program. The department may use up to three percent of the biennial appropriation from the affordable homeownership revolving loan fund account created in section 3 of this act for administrative costs related to the program.
(1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.
(1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.
Section 5 of this act expires July 1, 2028.
Section 6 of this act takes effect July 1, 2028.