Proposition Number 1 would authorize a seven-year property tax increase to finance low-income housing, and provide housing assistance to low-income households. The proposition defines low-income households based on guidelines published by the United States Department of Housing and Urban Development. Most levy funds would serve households earning less than 30% of Seattle area median income.
Some form of housing levy has been in effect since 1981. The last housing levy, which totaled $145 million, passed in 2009 and expires this year. If approved, Proposition Number 1 would increase taxes levied in 2016 through 2022 and collected in 2017 through 2023. It would authorize Seattle to raise up to $290 million in additional property taxes over the seven-year period. The City could levy no more than $41,428,571 in additional taxes each year.
The levy funds shall be used to finance affordable housing for low-income households, and otherwise to provide for the housing needs of low-income households. Proposition 1 includes anticipated levy programs as specified in Exhibit 1 to Ordinance 125028, a copy of which is printed in full in this pamphlet. Levy programs primarily fund construction, preservation and operation of rental housing, accounting for 84% of total funding. Funding also assists low-income homeowners and households at risk of homelessness, and pays for administration of levy programs.
In summary, the programs are:
Rental Production and Preservation. Construction and preservation of rental housing and rehabilitation of existing affordable housing serving households with incomes at or below 60% of median income. The majority of funding will serve households with incomes at or below 30% of median income.
Operating and Maintenance. Operating support for Levy-funded buildings that serve residents at or below 30% of median income, including formerly homeless and other residents needing supportive services.
Homelessness Prevention and Housing Stability Services. Rent assistance and stability services for individuals and families at or below 50% of median income, to prevent eviction and address homelessness.
Homeownership. Foreclosure prevention assistance for homeowners and loans for first-time homebuyers at or below 80% of median income; emergency home repair grants for homeowners at or below 50% of median income.
Acquisition and Preservation. Short-term loans for purchasing buildings or land for rental or homeownership development serving households at or below 80% of median income.
Administration. Funding for administration of levy programs.
The City Council could change the programs, consistent with the basic purpose of the proposition.
The City Council would periodically review and adopt Administrative and Financial Plans covering levy programs. The proposition would create an oversight committee to monitor and report on the progress of the levy programs.
State law generally limits the increase in property taxes to one percent above the highest amount that the City could have received in the prior year. Proposition 1 allows the City to exceed this limit. In 2017, the additional taxes would be approximately 25 cents per $1,000 of assessed value. The City's regular property-tax rate would not exceed the state law limit of $3.60 per $1,000 of assessed value.