New tax to nearly triple county’s affordable housing money, but even that’s not enough

Pierce County will be able to triple affordable housing investments in the coming years thanks to a new sales tax passed in 2023.

The Maureen Howard Affordable Housing Sales Tax — named after a prominent advocate for the homeless in Tacoma who died in January 2023 — will make available an expected $18.2 million to fund the preservation and creation of affordable housing in the region, a nearly three-fold increase from the $6.3 million in funding the county had in 2023.

Bryan Schmid, affordable housing supervisor for Pierce County, said the county’s goal is to use the new revenue to help fund the construction, renovation or acquisition of 1,700 units of affordable housing over the next six years — an anticipated 300 units per year.

Even with the estimated 300 units of extra affordable housing the sales tax is anticipated to create annually, the county is far away from closing the gap between what is available and what is needed.

“To fully meet the housing needs of current and future residents, the county needs to produce, on average, over 2,300 units per year of housing affordable at or below 50% of area median income (AMI) through the year 2044,” the county’s Housing Action Strategy of 2022 found. “Over half of these units are needed for households at 30% of AMI or below.”

According to the most recent data from the U.S. Census , Pierce County’s area median income was $91,486 in 2022.

Schmid said that last year the county helped close financing on projects that will provide roughly 850 units of affordable housing in the region, more than double than previous years, but he said that much of that was possible through American Rescue Plan Act (ARPA) dollars made available by the federal government during the pandemic.

Over the past two years, Pierce County spent about $20 million of ARPA funding on affordable housing, according to Schmid. He said the county was spending less than $5 million a year before the pandemic.

With ARPA funding streams sun-setting over the next year, Schmid said, Maureen Howard Affordable Housing Sales Tax will help sustain a “robust” pipeline of affordable housing that the region desperately needs.

“The ARPA funding got us going; this is keeping us going,” he said.

Schmid said that closing the gap between between affordable housing production and affordable housing need is not as simple as just increasing funding. He said the county’s effort to preserve or build affordable housing faces obstacles such as a limited number of developers willing to commit to projects, contractor availability, rising construction costs and an increasingly competitive market.

When the Notice Of Funding Availability (NOFA) announcements are made, developers interested in acquiring, renovating or building qualified affordable housing projects for rent or home ownership can apply with bids before the County Council approves a slate of the most competitive applications.

The NOFAs will be released and posted on the Pierce County Current Solicitations webpage on April 25. Applications are due June 24 and awards will be announced in September.

Editor’s note: The original date of the NOFA releases were incorrect and the correct dates have been added.