County commissioners approve sales tax increase
— Created March 30, 2022 by Kathy Reed
By Kathy Reed
In a unanimous vote, Island County Commissioners last week approved a one-tenth of one percent increase in the county’s sales tax. The tax, which will take effect July 1, will bump the sales tax from 8.7 percent to 8.8 percent across the county, with the exception of the city of Oak Harbor, where the sales tax will increase from its current 8.9 percent to nine percent.
The increase translates to an additional 10-cents for every $100 spent on taxable items. It’s anticipated the tax will raise approximately $1 million annually, and all funds are earmarked for affordable housing.
A public hearing on the matter was held in January and commissioners continued the hearing to last week to give the county’s Human Services department a chance to come up with a framework for how the funds would be spent. Staff presented the framework to commissioners at a work session earlier this month.
The tax revenue will allow the county to develop new rental housing, purchase land, improve infrastructure and allow for redevelopment of existing properties. Populations who would benefit from more affordable housing include veterans, senior citizens, domestic violence survivors, families with children in danger of losing housing, people with disabilities or mental health issues and unaccompanied young adults ages 18 to 24.
But commissioners pushed back against some public comments that included residents not wanting “those people” here, saying some people have a misconception of who would most benefit from more affordable housing.
“Just to clarify who ‘those people’ are, that would be paralegals in your prosecutor’s office; it would be road crew; it would be some of the folks in Human Services,” said Commissioner Jill Johnson. “It would be public health employees, it would be planning employees, it would be assessor’s employees and it would be treasurer’s employees, because we have employees working full time in this county who qualify [for affordable housing] under these AMI (Average Median Income) requirements.”
“Childcare workers, retail workers, bankers,” chimed in Commissioner Janet St. Clair. “That understanding of what workforce housing is, is important.”
“I think it’s important to think about who ‘those people’ are, because ‘those people’ are us,” Johnson said. “There are new apartments that opened in Oak Harbor. They’re nice looking – $1,700 a month. When I was 35 years old, working at Whidbey Island Bank as the assistant marketing director, I could not have afforded that apartment. With a college degree, with 15 years of work experience, I couldn’t afford that.
“In fairness, there will be individuals who will be served that have mental health issues, who have chemical dependency issues…and some behaviors,” she said. “Those people are also part of our communities and they’re also a part of our families. I would challenge every one of us to lay out a family tree and not circle somebody who we would describe as ‘those people.'”
Commissioner St. Clair, who said she was initially leaning toward voting “no” on the measure, felt it was important to recognize the additional tax, though small, would not be popular among many voters.
“We are at a 16 percent adjusted, mean CPI (consumer price index) inflation rate; 16 percent. People are feeling that,” she said. “Add to that we have gas prices in some parts of our county as high as $5 a gallon. These are real, real pressures that our working families are feeling. We, as advocates, need to acknowledge that what doesn’t feel like a big thing to me, is a big thing to others, whether it’s in perception or reality.”
But St. Clair said that after much thought, it became apparent the county needs the extra funding for affordable housing.
“I want to first of all be clear that we do have a number of sources of revenue, such as document recording fees, etc. None of the historic, local dollars that we have at our disposal are enough to create affordable housing,” she said.
Commissioners also pointed out surrounding counties have already passed this tax.
“Whatcom County passed this tax. Skagit County passed this tax. Snohomish County passed this tax,” Johnson said. “So most people who regionally go out and buy big ticket items, if you choose to buy that item in another community, you’re creating workforce/affordable housing for that community. The only thing we are actually doing by not passing this sales tax is disproportionately putting a burden on our businesses that are going to have to pay higher wages to keep their employees in this market of unaffordable housing.”
Under the law, 60 percent of funds collected must be used for construction of new affordable housing and the for the purchase of land or buildings. Forty percent could be used for support services for new housing. County commissioners added two restrictions, including one that stipulates any new affordable housing created with these funds must remain so permanently. The other stipulation requires the tax be suspended after 10 years if no new housing units have been created, or at any time the balance of the fund exceeds $10 million, or if the percentage of rent-burdened households falls below 10 percent.
Meetings of Island County Commissioners are available to view online at islandcountywa.gov.